Kaizen Binder

5-MINUTE DRILL FORMAT (LIST AREA HERE)

To be completed at the beginning and end of each shift
 List what needs to be cleaned and organized before the station is ready for use:

1.
2.
3.
4.
 List what employee needs to have for tools and uniform/dress to start work:
1.
2.
3.
4.
 List what specific items/containers need to be set in place for the station set up:
5.
6.
7.
8.
9.

5-MINUTE DRILL -- TEXTILES

Complete at beginning and end of shift
 Sweep and clean area
 Remove all items that do not belong and take them to the appropriate locations
 Check cell layout setup according to plan-o-gram:

 Place four wire bins or plastic boxes under table:
 One labeled “Ladies Bin”
 One labeled “Men’s Bin”
 One labeled “Children’s Bin”
 One labeled “Domestics and Linens Bin”

 One big blue bin used for Bale
 One hanger rack filled with appropriate hangers
 One rolling rack against window for specials
 One Z rack
 One container of Raw Textiles

5-MINUTE DRILL -- WARES

Complete at beginning and end of shift
 Sweep and clean area
 Remove all items that do not belong and take them to the appropriate locations
 Check cell layout for all needed containers:

 One container of raw, unprocessed hardlines for each hardline cell
 Five empty baskets. If full, take to appropriate location and bring back empty

bins.
 One labeled “Belts”
 One labeled “Ties”
 Two labeled “Handbags”

 One plastic box labeled “HHW”, one box labeled “SEAM”
 Two trashcans placed according to layout
 One empty 3-tier cart for finished product
 On table:

 Five pricing guns (four set at appropriate prices and one for
miscellaneous prices)

 One box of rubber bands
 One basket on table with the following supplies:

 One scissors
 One magnifying glass
 Four rolls of pricing labels

(LIST AREA HERE) STATION PROCEDURE FORMAT

Station Preparation Set Up
List everything here that an employee would need to know so they could set this station
up from the beginning:

1.
2.
3.
4.

Start Work
List everything here that an employee is expected to do throughout their shift. If a new
employee worked in this area, list enough information here, as they might need:

1.
2.
3.
4.

Note:
After the employee works through the 5-minute drill they will be reviewing this procedure
to know what is expected of them each shift. Did you put all the information here that
they will need?

Area Map Observer:

Department: Operation: Date: / /

Steps: Distance:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Total:

CHECKLIST

Department/Area: Auditor:
Date:
Rank A: perfect score Rank B: 1-2 problems Rank C: 3 or more problems
5-S
Category Item Rank Comments
ABC
Sort Have all unnecessary items (stock, materials,
parts, etc.) or work-in-process been removed?
 Organization Are all tools/equipment (hand tools, machines,
 When in doubt, move jigs, etc.) in regular use?
Are all remaining items neatly arranged and
it out stored in an appropriate place?
 Distinguish between Are all items (parts, tools, etc.) neatly arranged
and can they be distinguished at a glance?
what is needed and Are obsolete items routinely purged & is
not needed there a process to remove unneeded items?
Is there a place for everything (tools, parts,
Straighten etc.) and are locations clearly labeled?
Is everything in its place & presented to the
 Orderliness operator at point-of-use/frequency-of-use?
 A place for everything Are all shelves & items in storage clearly
labeled with p/n, min/max quantities, etc.?
and everything in its Is it easy to see what needs to be where
place and are things put away after use?
 Point-of-use Are all documents/bulletins orderly, up-to-
date & labeled with revision/responsibility?
Scrub Are work areas clean – including floors,
table tops, conveyors, etc.?
 Cleanliness Are machines/equipment/tools kept clean
 Eliminate “mess” and painted?
Are cleaning guidelines/schedules/rotations
creators easily visible, up-to-date and followed?
 Look for ways to keep Are cleaning materials (brooms, dustpans, rags,
cleaners, etc.) easily accessible?
area clean and Is cleaning, sweeping, wiping, etc. regarded
organized as a “habitual” activity?
Are the first three categories (sort, straighten &
Standardize scrub) being maintained and monitored?
Is all necessary information (standards,
 Adherence checklists, etc.) known, visible & recognizable?
 Prevent backsliding Are all operators aware of standards,
 Maintenance of the checklists, cleaning schedules, etc.?
Does the layout/equipment/tools support
first three S’s the avoidance of dirt/waste accumulation?
Is the air clean and odorless and is the
Sustain lighting angle/intensity appropriate?
Are 5-S audits/checklists conducted
 Self discipline & regularly (spvsr.-1/wk., mgr.-1/mo., director-1/qtr.)
management Are all previously completed 5-S
involvement audits/checklists posted in the area?
Does everyone observe the standard
 Stick to the rules cleaning procedures, schedules, etc.?
 Measure improvement Do all employees continuously and
consistently follow all 5-S categories?
Are personal belongings stored neatly and
orderly

Total number of A’s, B’s and C’s

Multiply x4 x3 x2

Total + += = 5-S Score

Process Flow Chart Form

Revision:

Process/Job: Date:
Chart begins:
Chart ends: Page: Of:

Charted by:

Possibilities / Changes
TRANSFORM
DETAILS OF METHOD TRANSPORT NOTES
STORAGE
1. ELIMINATE
2. COMBINE
3. SEQUENCE
4.
5. PLACE
6. PERSON
7. IMPROVE
8. QUANTITY DISTANCE TIME
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
27.
28.
29.
30.

Totals:

CONVERSION TO SECONDS

Minutes to Seconds Hours to Seconds Days to Seconds

1 = 60 31 = 1860 1.0 = 3,600 16.0 = 82,800 1= 86,400
2 = 120 32 = 1920 1.5 = 5,400 16.5 = 59,400
3 = 180 33 = 1980 2.0 = 7,200 17.0 = 61,200 2 = 172,800
4 = 240 34 = 2040 2.5 = 9,000 17.5 = 63,000
5 = 300 35 = 2100 3.0 = 10,800 18.0 = 64,800 3 = 259,200
6 = 360 36 = 2160 3.5 = 12,600 18.5 = 66,600
7 = 420 37 = 2220 4.0 = 14,400 19.0 = 68,400 4 = 345,600
8 = 480 38 = 2280 4.5 = 16,200 20.0 = 72,000
9 = 540 39 = 2340 5.0 = 18,000 20.5 = 73,800 5 = 432,000
10 = 600 40 = 2400 5.5 = 19,800 21.0 = 75,600
11 = 660 41 = 2460 6.0 = 21,600 21.5 = 77,400 6 = 518,400
12 = 720 42 = 2520 6.5 = 23,400 22.0 = 79,200
13 = 780 43 = 2580 7.0 = 25,200 22.5 = 81,000 7 = 604,800
14 = 840 44 = 2640 7.5 = 27,000 23.0 = 82,800
15 = 900 45 = 2700 8.0 = 28,800 23.5 = 84,600 8 = 691,200
16 = 960 46 = 2760 8.5 = 30,600 24.0 = 86,400
17 = 1020 47 = 2820 9.0 = 32,400 9 = 777,600
18 = 1080 48 = 2880 9.5 = 34,200
19 = 1140 49 = 2940 10.0 = 36,000 10 = 864,000
20 = 1200 50 = 3000 10.5 = 37,800
21 = 1260 51 = 3060 11.0 = 39,600 11 = 950,400
22 = 1320 52 = 3120 11.5 = 41,400
23 = 1380 53 = 3180 12.0 = 43,200 12 = 1,036,800
24 = 1440 54 = 3240 12.5 = 45,000
25 = 1500 55 = 3300 13.0 = 46,800 13 = 1,123,200
26 = 1560 56 = 3360 13.5 = 48,600
27 = 1620 57 = 3420 14.0 = 50,400 14 = 1,209,600
28 = 1680 58 = 3480 14.5 = 52,200
29 = 1740 59 = 3540 15.0 = 54,000
30 = 1800 60 = 3600 15.5 = 55,800

Process Flow Chart Form

Revision:

Process/Job: Date:
Chart beginsD: onation Center
Chart ends: Sales Floor Page: Of:

Charted by:

Possibilities / Changes
TRANSFORM
DETAILS OF METHOD TRANSPORT NOTES
STORAGE
1. ELIMINATE
2. COMBINE
3. SEQUENCE
4.
5. PLACE
6. PERSON
7. IMPROVE
8. QUANTITY DISTANCE TIME
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
27.
28.
29.
30.

Totals:

WARES / HARD-GOODS / ELECTRONICS
PROCESSING WORK INSTRUCTIONS

Follow these procedures when working at this HARD-GOODS processing
station:

1. Make sure the cell you are working in has incoming hard-goods product.
When necessary, incoming hard-goods product is brought from the hard-
goods staging area when directly-incoming donations are not there. Use a
pallet jack and move 1 gaylord of hard-goods product into your work station
to produce product from.

2. Before you begin processing, first check to ensure that all tools and
equipment from your inventory control list are present. If you are missing any
tool or necessary equipment, inform your supervisor. Once all needed tools
have been verified, begin processing.

3. Pick up a hard-good item from the processing belt or gaylord of product.
Inspect the item to determine if sellable. Item must bring a value greater than
$.99 in order to pass inspection and process to sales floor.

IMPORTANT NOTE* refer to your safety board in your processing station
for CPSC RECALLS and updates.

*NO TOYS WITH ANY PLASTIC WILL PASS INSPECTION! ALL TOYS ARE
TO BE SENT INTO YOUR TRASH BIN.

4. If item passes inspection wipe down the item and clean. Use spray cleaner
for all kitchen and glassware items.

5. Review the item and look for special insignias. If you see any type of number
or unusual name or marking, refer to your antique guide for further reference
or set into the tote labeled ‘shopgoodwill.com’ for your supervisor to view
later. Your teammates are also good references for this!

6. Next determine a price. Pull a sticker from your price-tag dispenser and
place onto the hard-good item. Important to refer to your training guide for
placement of these stickers on the item.

7. Once you have placed a price sticker on the item, place into your wares cart
and then repeat steps 3 through 6. When your cart is full, move it to the
staging area to be placed on the sales floor.

Be sure and track your cart production count on your team’s production board.

Hard-line Processing

STEP 1. STEP 2. STEP 3.

Inspect item & determine if Clean item if it is dirty. Determine price and place sticker on item.
it is sellable.

STEP 4. ELECTRONICS

Place item in rolling cart to send to sales floor. Place all PRICED electronics onto wire cart behind workstation.
Repeat steps 1 - 4 until cart is full of merchandise to sell. Continue to fill until full, then wrap wire cart with shrink film and stage



on item.

t behind workstation.
t with shrink film and stage.



Accessories Goods Station Standard Work

Authorized Items List Hats Work Table Hangars Across Top of Table
Belts Scarves Ties are underneath the work table
Barbs
Gloves Raw Crate
Small Plastic Bags
Rubberbands Recycle
Lint Roller
Sharpie Process Steps 5 Minute Drill
Tape 1. Move Items to Table 1. Sweep the workstation area
Tagging Gun
Barb Tagging Gun
Scissors
Water Bottle
Personal Item

2. Sort / Quality Check 2. Fill Hanger
Hats 3. Take Bail
Belts 4. Clean workstation surface
Scarves
Hanging Items

3. Pickup Wood Hangers to Refill Racks 5. Empty trash

4. Hang by Price

5. Signal Cards for Removal (bail & trash)

6. Empty trash & remove bail

7. Tag Rack

8. Complete Log

Books Production

Authorized Items Rec E Scanner
Disc com
Crate
Computer Price Crate
Keyboard Tub Raw
Scanner
Mouse Recyc
Mouse Pad Tub
Clip Board
Price Gun
Wide Clear Tape
Sharpies
Pens
Scissors
Water Bottles
Personal Item(s)

Book Production Process 5 Minute Drill
1. Pick up raw books 1. Sweep the workstation/work area
2. Evaluate - Sale or Cull? 2. Verify that all Book Work Station Inventory is in place
3. Scan the books 3. Empty trash
4. Place in Crate 4. Request raw if needed
5. Apply Price 5. Wipe/Clean Computer
6. Complete Production Log
7. Take to Floor

Mechanical Work Station

wall organizer 1 fabric freshener 1 Dolly Work Station Trash
rag container 10 to 20 leather/vinyl cleaner 1
Raw Mechanical
extension cord 1 goo gone 1 Mech Processing

gorilla glue 1 wood cleaner 1 Charging
mechanical clipboard 1 150 mm allen wrench 1 station
drill charger 1 20 mm allen wrench 1
power drill 1 10mm allen wrench 1 Mechanical Production Process
power strip 1 multi cleaner 1 1. Select Mechanical item
WD-40 1 1 box of fbric softner sheets 1 2. Evaluate item - Sale, Cull or Salvage?
3. If Cull or Salvage, place in appropriate gaylord/bin
rubber mallet 1 3 pocket desk organizer 1 4. If Sale, minor repair and clean as needed
hammer 1 1 pen organizer 1 5. Place in bin/cart
lint shaver 1 1 1/2 inch staples 1 6. Log production
trash can 1 1 3/8 staples 1 7. Take bin/cart to floor
flat head screw driver 1 box of knobs/handles 1
tag gun 1 extra long screw driver 1 Five Minute Drill
tape gun furniture 1 heavy duty stapler 1 1. Sweep work area
tape gun mechanical 1 socket set 1 2. Enough raw product for morning
drill bit set 1 socket handle 1 3. Empty trash.
screw and nail organizer 1 tape measure 1 4. Mis-sorts to ADC
razor scraper 1 stapler 1
paint scraper 1 wire cutter 1
wire brush 1 wrench set 1
bolt cutter 1 vise grips 1
window cleaner 1 crowbar 1
dust pan 1 siphon 1
wood glue 1 safety pins for tickets 1

Proficiency Standards for First Sort Stores

The proficiency standards are targets for each team member to reach. At first they might seem difficult
to reach, but together with leaders, we can determine what is preventing you from being able to reach
that target and help remove those barriers. Please connect with your production leader if you have
questions.

Sorting

Includes unstacking gaylords and setting up station

Min per CONTAINER Containers per HOUR

Apparel 30-45 minutes per gaylord 1.25-2 gaylords
Wares/Seasonal
Domestics 30-45 minutes per gaylord 1.25-2 gaylords
Books
Glass 30-45 minutes per gaylord 1.25-2 gaylords
Shoes
Electrical (Sort & Ticket) 30-40 minutes per gaylord 1.25-2 gaylords

Apparel (Hang) 40-50 minutes per gaylord 1-1.25 gaylords
Apparel (Ticket)
Wares/Seasonal 15-30 minutes per gaylord 2-4 gaylords
Domestics (Hang & Ticket)
Books 30-45 minutes per gaylord 1.25-2 gaylords
Glass
Shoes Ticketing/Hanging

Includes setting up station

Min per CONTAINER Containers per HOUR

30 minutes per z-rack 2 z-racks

15-25 minutes per z-rack 2-4 z-racks

30-40 minutes per cart 2-2.25 carts

45-60 minutes per z-rack /cart 1-1.25 z-racks/carts

10-15 minutes per cart 4-5 carts

30 minutes per cart 2 carts

20 minutes per cart 3 carts

Merchandising

Includes traveling between backroom and sales floor

Min per CONTAINER Containers per HOUR

Apparel 15-25 minutes per z-rack 2-4 z-racks

Wares/Seasonal 30-45 minutes per cart 2-5 carts

Domestics 15-25 minutes per z-rack /cart 2-4 z-racks /carts

Books 10-20 minutes per cart 3-5 carts

Glass 20-35 minutes per cart 2-3 carts

Shoes 15-30 minutes per cart 2-4 carts

Electrical 15-30 minutes per cart 2-4 carts

Pull

Includes traveling between backroom and sales floor / sorting through items to clearance or salvage

Min per CONTAINER Containers per HOUR

Apparel 40 minutes per z-rack 1.25-2 z-racks
Wares/Seasonal 30 minutes per cart 2 carts
Domestics 20 minutes per z-rack /cart 3 z-racks /carts
Books 12 minutes per cart 4 carts
Glass 60 minutes per cart 1 cart
Shoes 10 minutes per cart 5 carts
Electrical 15-30 minutes per cart 2-4 carts

Proficiency Standards for Quality Sort Stores

The proficiency standards are targets for each team member to reach. At first they might seem difficult
to reach, but together with leaders, we can determine what is preventing you from being able to reach
that target and help remove those barriers. Please connect with your production leader if you have
questions.

Quality Sorting

Includes unstacking gaylords and setting up work area

Min per CONTAINER Containers per HOUR

Raw Donations 20-40 minutes per rolling bin 1.25 dandux’s (laundry type bin)

Apparel Hanging

Includes setting up station

Min per CONTAINER Containers per HOUR

Apparel (Hang) 30-40 minutes per z-rack 1.25-2 z-racks

Pricing

Includes setting up station

Apparel 30-40 minutes per z-rack 1.25-2 z-racks

Wares/Seasonal 45-60 minutes per dandux .75-1 dandux

Domestics (Hang & Ticket) 30 minutes per dandux 2 danduxes

Books 30-35 minutes per dandux 2 danduxes

Glass 60 minutes per dandux 1 danduxes

Shoes 45 minutes per dandux 1.25 danduxes

Electrical 45 minutes per dandux 1.25 danduxes

Merchandising

Includes traveling between backroom and sales floor

Min per CONTAINER Containers per HOUR

Apparel 15-25 minutes per z-rack 2-4 z-racks

Wares/Seasonal 30-45 minutes per z-rack 2-5 z-racks

Domestics 15-25 minutes per z-rack/cart 2-4 z-racks/carts

Books 10-20 minutes per cart 3-5 carts

Glass 20-35 minutes per cart 2-3 carts

Shoes 15-30 minutes per cart 2-4 carts

Electrical 60 minutes per cart 1 cart

Pull

Includes traveling between backroom and sales floor / sorting through items to clearance or salvage

Min per CONTAINER Containers per HOUR

Apparel 40 minutes per z-rack 1.25-2 z-racks
Wares/Seasonal 30 minutes per z-rack 2 z-racks
Domestics 20 minutes per z-rack/cart 3 z-racks /carts
Books 12 minutes per cart 4 carts
Glass 60 minutes per cart 1 cart
Shoes 10 minutes per cart 5 carts
Electrical 15-30 minutes per cart 2-4 carts

Shoes Production Standard Stations

Gloves Bin G Hallow

Pricing Pen (Sharpie) Mens Sorting Cubes

Scissors Under the Cubicles
Tagging gun
Luggage, Wallets & Supplies
Shoe polish
Raw Crate Unp. Purs. Used for Moving/Staging
Cleaning Supplies Trash Unpriced Purses
Shoe brushes
Rubber bands Shoes Production Process 5 Minute Drill
Spray bottle 1. Sort & Quality Check 1. Sweep
Deoderizer 2. Price Right Shoe (in writing) 2. Clean off counter
Goggles 3. Place in Cubicle 3. Empty Trash
Clipboard 4. Applies Price Tag
Pen 5. Sort to Shopping Cart
Rags 6. Complete Log
Tag Scraper 7. Move to Floor
Personal Item

Textiles Tagging Standard Work Station

Authorized Items List Sm Sup A
I Hangers
Tagging Guns (4) S S Hangers
Barbs u L Hangers
Tags p E Hangers
Needles for Tagging Guns p
Covered Water Bottles l Hangers
Clipboard Hangers
Pen Sm Sup Hangers
Personal Item
Scissors 5 Minute Drill
Grabber Tool 1. Sweep the workstation area
Sharpie 2. Remove items that don't belong
Flashlight 3. Clean workstation surface
4. Empty trash
Process Steps

1. Move Z Rack to Tag Station

2. Size & Tag w/Quality Check

3. Transport to Staging Area

4. Record Production

Textiles Station Bale Raw

Approved Items Raw
Stapler, 1
Sharpies, 3 Wares Process
Pens, 3 1. Get supplies and paperwork at start of shift
Color markers, set of 5 2. Pull product from raw gaylord and evaluate
Tagging gun, 3 3. Place in salvage or pricing table
Tape gun, 2 4. Price sellable Product
Scissors, 2 5. Clean product if needed
Rags 6. Place product in cart to go to floor
Polly bags (XS, S, M, L)
Calendar Five Minute Drill
Glass cleaner, 2 Remove items that don't belong
All purpose cleaner, 2 Take mis-sorts to ADC
Clipboard, 3 Clean work station
Flashlight, 1 Sweep work area
Magic Eraser, 1
Straight blade with holder, 2
Personal item, 1 each
Goggles, 1 each
Long reach grabbers, 1 each
Multi Tool



Wares Station Wares Process
1. Refill price ticket clips
Approved Items for each 2. Verify all approved items are at table
Clicker, 1 3. Pull product from raw gaylord and evaluate
Sharpies, 1 purple 1 black 4. Place in salvage or pricing table
Pens, 2 5. Price sellable Product
Rubber bands, 1 full container 6. Clean product if needed
Small zip ties, 1 bag 7. Place product in cart to go to floor
Packing Tape gun, 1
Scissors, 1 Five Minute Drill
Rags, 1 Remove items that don't belong
Polly bags (S, M, L) Take mis-sorts to correct dept.'s
Post it note pad, 1 Put items into Shopgoodwill wire
Masking tape w/ dispenser, 1 Put approved items back into tray
Straight blade with holder, 2 Clean work station
Long reach grabbers, 1 Sweep work area
Clipboard w/ production sheet, 1 Empty trash
Flashlight, 1
Personal item, 1 each



THE Gi KAIZEN METHOD

HOW YOU CAN TRANSFORM MORE
DONATIONS INTO SALEABLE MERCHANDISE

QUICKLY

AT NO EXPENSE

AND SIMULTANEOUSLY IMPROVE MORALE
AND SAFETY AMONG YOUR STAFF

By
John Miller, Chief Executive Officer
Vickie Volpano, Senior Vice President – Retail Operations
John Poole, Vice President – Commercial Services
Goodwill Industries of Southeastern Wisconsin and Metropolitan Chicago, Inc.

Over the past eight months, the process of turning donations into saleable merchandise in this
Goodwill has been transformed. We have completely changed our approach, and in doing so,
we have dramatically increased sales, found added work space in crowded quarters, improved
employee morale and enthusiasm, and improved safety conditions. Best of all, the new
approach did not cost hundreds of thousands of dollars in consultant fees, new equipment, or
remodeling. The biggest investment was time – setting aside a few days at each store to make
the transition.

We are so impressed with the success of this new approach that we want to share it with you.
This method works anywhere, in any type of business or occupation. It is particularly applicable
to Goodwill’s unique task of collecting and reselling donated goods to the retail public.

What is Gi Kaizen?

Loosely translated, the word, “kaizen” is Japanese for “continuous improvement.” The word,
“Gi” is Japanese for Goodwill.

The kaizen method was developed in Japan in recent years and first used in the automobile
manufacturing industry. It is catching on in America because it involves a simple, practical
approach to the goal of “process improvement.”
Its two major components are:

 Five S Workplace Organization (Sort, Straighten, Sweep, Standardize, and
Sustain)

 Cellular Production (Creating standardized, streamlined work cells that concentrate
on activities that add value to the job at hand and eliminate activities that do not)

Like many organizations, we have been committed to process improvement for several years.
However, previous consultants and exploration of other approaches resulted in suggestions that
would be far more costly, complicated, and difficult to maintain over the long term. We have
found the kaizen method to produce rapid, sustainable improvement in donated goods
processing.

How did we apply the Gi Kaizen approach to Goodwill stores?

Each of our 15 store/donation centers held two or more “Gi Kaizen events.”
A Gi Kaizen event takes three to four days. Each event gathered a team of 10 to 20 people.
About half of the team were store managers and employees; half were non-retail Goodwill staff,
who were able to offer an outside perspective. Selection of this type of cross-functional team is
important, and differs from traditional “best practices” or “benchmarking” team selection
processes.

 In the morning of Day 1, the team learns Gi Kaizen principles and applications of 5S
Workplace Organization and Cellular Production.

 During the afternoon of Day 1, the team begins the 5S Workplace Organization process by
Sorting, Straightening, and Sweeping.
Sorting is segregating and discarding all unnecessary items from the production
environment. “When in doubt, throw it out!” or “Sell It!” Straightening is arranging remaining
items and identifying their proper location. “A place for everything and everything in its
place.” Sweeping is cleaning the workplace of debris.

 On Day 2 ,the team maps and measures its current donation processing methods in terms
of both time and distance. This process identifies waste and allows the team to redesign
the process focusing on activities that add value to the operation, while eliminating actions
that waste time.

 On Day 3, the team continues the 5S Workplace Organization by Standardizing and
Sustaining the reorganization of the workplace that was accomplished the day before.
Standardizing means frequently revisiting the sorting, straightening, and sweeping to
generate new improvements. Sustaining is developing visual performance measurement
tools that will promote adherence. Additionally, the team maps and measures the new
standard work process for improvement in preparation for a team presentation.

 On Day 4, the team prepares, practices, and presents a team presentation outlining their
activities from the previous three days and communicating the measurable results of these
activities. Store and donations staff who did not participate in the process attend the
presentation, as do managers and leadership from throughout the Goodwill organization.
The presentation develops the team’s confidence in communicating the merits of the Gi
Kaizen process, and helps build an organization-wide culture of continuous improvement.

What were the results?

We now have less cluttered, cleaner, more rational workplaces at all of our stores, which has
resulted in improved morale, higher productivity and more efficient use of space. Year-to-date,
our 33-year-old Plant Store has produced 11% more sales than it did in the first seven months
of 1999. Transactions are only up 1.3%, but sales per transaction are up 9.5%.

Gi Kaizen has impacted both sales and margins. Through July 2000, Retail Operations
performance is improved over 1999 with revenues up $1.8 M and margins increased by
$936,000.

Donations employees report that they are able to work faster and no longer have to break away
from their tasks to move carts of clothing out of the way, etc. One employee, who uses a cane
due to a disability, commented that she is glad the floor is now clear of clutter.

Can these results really be sustained?

Yes.

Case in point: On Saturday, January 22, 2000, the back of our Plant Store was its usual
beehive of activity. About 20 store processing personnel, the store manager, and the assistant
manager were getting the store ready to open at 9 a.m. The back room was so crowded that in
many areas you needed to turn sideways to move around. We seemed to be flooded with
donations. Material handling equipment was stacked everywhere, and the adjacent dock area
was similarly crowded.

During the following week, the first Gi Kaizen event was held, focusing on the donation-to-rack
process. Afterward, management took a tour of the store’s back room. We were astounded by
the vast amounts of open space and the transformation of the processing effort. There was,
however, considerable skepticism that the changes were sustainable. We agreed that we would
all meet on February 29 to take the same tour. The next day, we met with Cora Stellpflug and
Judy Dykstra, the manager and assistant manager of our Plant Store. As we stood in the neatly
organized, clearly labeled, orderly, quiet processing area, looking at more open than occupied
space, Cora, who has worked for us for more than 15 years, and Judy who has more than 20
years of service, commented that “there seemed to have been a big slowdown in donations”
over the past week. In fact, they themselves had brought about the dramatic changes in the
workplace by streamlining operations.

Our initial skepticism proved to be unfounded. The positive changes in our Plant Store were
sustained. We have been through peaks in our donation cycle on Memorial Day and July 4, and
every time we visit that back room it still works.

There has been another Gi Kaizen event at this store, and there will be more in the future,
because this is about continuous, not just one-time improvement.

Gi Kaizen from three individual perspectives:

We would like to discuss Gi Kaizen from the perspectives of the executive charged with
process improvement, the executive responsible for the donated goods operation and the chief
executive. These perspectives are important because Gi Kaizen requires both
leadership and commitment. It creates changes in operations that cannot be imposed on
workers but which they can and will adopt for themselves if they see that the commitment of
management at all levels is sincere. In addition, management must provide the tools that
workers and supervisors require to improve their workplace and productivity. Finally,
management must lead by example.

A CEO’s perspective
By John L. Miller

Goodwill Industries of Southeastern Wisconsin and Metropolitan Chicago, Inc. has been
collecting and selling donated goods for 81 years. In the late 1980s, we shifted from central to
on-site processing and adopted the store/donation center model. But like most Goodwills that
went through this transition, our stores lacked the docks, back room space and other
characteristics of a true store/donation center. Typically, the processing centers (which
occupied about one-third of the space in each unit) were run as each individual manager saw fit.

The Gi Kaizen process has brought to light the difference between retailing and
manufacturing. Goodwills often seek out store managers and donated goods executives who
have considerable experience in retailing. These individuals generally come to Goodwill with a
blind spot. They assume that material in the back room of the store is saleable! This
assumption arises from the simple reality that in a department store, a chain discount store, or
any supermarket there is a back room with merchandise waiting to be displayed, all of which is
saleable. Some of it has to be ticketed, but decisions as to its salability have been made
elsewhere. This is not true in most contemporary Goodwill stores. An insight we gleaned from
our experiences with Gi Kaizen is that the preparation of materials for sale in our stores is a
manufacturing process and must be managed as such. The principles of Gi Kaizen are not
only useful, but in fact, critical to successful extraction of value from our donations.

In the past, our management has solicited proposals from consulting firms to lead a process
improvement effort in our donated goods system. The proposals we received were not
particularly compelling and very expensive, ranging up to $250,000 for a 9-month effort. Not
liking the alternatives we had seen, we made a decision in November 1999 to hire an individual,
John Poole, who had never worked in a retail setting in his life and who had no responsibility
other than to improve processes in the organization, beginning in the Retail Division.

No management effort we have made in Goodwill has ever produced as much positive
change as rapidly as this one. Based on our familiarity with other Goodwills, we believe these
principles can be applied immediately and at no cost to any Goodwill anywhere and will effect
an immediate improvement in operations. They will look better, be more organized, cleaner and
produce measurable financial improvement.

The best thing about Gi Kaizen is that it is free. It is a set of ideas, and hence transferable at
the speed of thought. We have already introduced these concepts to colleagues from Goodwill
Industries of Central Indiana, North Central Wisconsin, and Portland, Oregon, and have no
doubt that they can and should spread throughout all Goodwills.

Of course, this applies not just to the back rooms of our stores, but to all our processes. We
experimented with using the Gi Kaizen method in our Human Resources department. We
focused on one task: completion of a personnel file for each new employee that meets
regulatory compliance. Throughout my tenure, this process has taken about four weeks to
complete. When we analyzed the steps involved with a Gi Kaizen team, we found it actually
should require just three days. We have set a target of having the entire file for each new hire
completed in four days, and have made great progress toward that. We are now at seven days
on average, and declining.

A Retail Executive’s Perspective
By Vickie Volpano

“A place for everything and everything in its place.” - Mother
“Change is good!” – Mother Nature

As a 14-year Goodwill associate, allow me to share my perspective on how Gi Kaizen can
assist in our shared interest to have Goodwill Industries, and specifically our donated goods
programs, thrive.

It was mid-1986 when I came to Goodwill from a national retailer. Store sales have since grown
six times from $2.8M to over $17M this year and store presentation is greatly improved.
However, our donated goods production improvement efforts were neither complete nor
comprehensive. In retrospect, there was well-veiled opportunity in the deplorably low salvage
prices of 1998 and 1999. We have since gained some appreciation for lessons learned and for
opportunities that emerged (at least in part) from those difficult times. During this period of
intense “character building,” we were compelled to focus on the margins our store operations
were—or were not—generating.

Our donated goods operations simply were not as efficient as they could and needed to be. We

made progress, but never reached a level of proficiency in the production of donated goods that

translated to improved bottom-line performance—until now.

In the last eight months we have certainly not gained every insight needed to run a successful
donated goods program. But we have clearly benefited greatly from applying Gi Kaizen, 5-S
Workplace Organization, and Cellular Production principles in the workplace.

In addition to improving bottom line performance, Gi Kaizen improves operations in other

fundamental ways. First, Gi Kaizen is a true workforce development tool. Its

implementation is not a one-time shot through operations with “best practices” prescribed

and mandated by management. Rather, Gi Kaizen, 5-S Workplace Organization, and

Cellular Production are tools and philosophies. And in the true spirit of Goodwill and

workforce development, it is the participants and employees whom we serve and work

alongside with who discovered and implemented real solutions to the challenges of

operations.

Secondly, Gi Kaizen encourages creativity before capital. As mentioned earlier,

implementation does not take significant resources—it is essentially free. What is required

is a more precious commodity, the investment of time. As with any process improvement

initiative, Gi Kaizen does require a significant investment of people and the commitment of

management.

To remain relevant in an increasingly competitive donation and retail market, we must
ceaselessly improve our operations. To increase funds to support the mission and good work of
Goodwill, we must ceaselessly improve the productivity of our operations. And Gi Kaizen can
help.

The Process Improvement Executive’s Perspective
By John Poole

The Gi Kaizen event is conducted with an understanding of the following two axioms:

1. Bias for action.
2. Creativity before capital.

Having a sense of urgency drives change in an organization by identifying, addressing, and
taking immediate action at all levels to make improvements. Previously described dissatisfaction
with Retail Operations performance and the need to overcome the drop in salvage prices
provided the sense of urgency to motivate Goodwill to improve its donations processing
activities, so as to more quickly turn donated items into saleable merchandise. This provided
the “bias for action.”

Because the process of reselling donated items is inherently wasteful, we must look for
improvements using existing resources. A focus on waste reduction generates capacity and
may resolve any need for capital spending. In this case, we were able to improve use of space
in the areas of stores dedicated to donations processing, which eliminates the need for
expensive renovation or expansion. This illustrates “creativity before capital the future of Gi
Kaizen in Goodwill’s retail operations will be the integration of product and information
throughout the entire Value Delivery System, continuously improving quality, cost, and
response.

DATE:
LOCATION:
MANAGER:

Auditor:
Region:

Back Room 6 - S Audit

Hardlines Sort & Straighten Sweep Standardize & Sustain Safety & Security 0 20 0%
Production 0 20 0%
1 Inventory control sheet posted (tote) 1 5-min drill posted 1 Employee has shirt & name tag on it 1 Wares Coding System in place 0 20 0%
Areas 1 Items on sheet found easily 2 Completes 5-min drill at end of each shift 1 Employee knows daily prod. goals 1 Employee knows where to find MSDS info 0 20 0%
1 Designated locations-silohets/labels 1 Horizontals clean up to 8 feet 1 Wares are properly tagged 1 Emp. Knows emergency procedures 0 20 0%
Textiles 1 No extra/unnecessary tools/equip 1 No food in area 1 Employee knows/can explain mission 1 Needles sanitized each shift
Production 1 Items returned to proper place 1 Community Service in Dress Code/Apron 1 Area taped off
Sweep
Areas Sort & Straighten Standardize & Sustain Safety & Security
1 5-min drill posted
Donation 1 Inventory control sheet posted (tote) 2 Completes 5-min drill at end of each shift 1 Employee has shirt & name tag on 1 Needles sanitized each shift
Area 1 Items on sheet found easily 1 Horizontals clean up to 8 feet 1 Employee knows daily prod. goals 1 Employee knows where to find MSDS info
1 Designated locations-silohets/labels 1 No food in area 1 Employee hs gone thru an Audit w/30 days 1 Emp. Knows emergency procedures
Break 1 No extra/unnecessary tools/equip 1 Employee knows/can explain mission 1 Area is clutter free
Area 1 Items returned to proper place Sweep 1 Textiles barbed/tagged correctly 1 Area taped off

Supply Sort & Straighten 1 All boxes/totes have Dates/Labels/Store # Standardize & Sustain Safety & Security
Shelves 1 Textile & Wares separated from each other
1 Inventory control sheet posted 1 Horizontals clean up to 8 feet 1 Employee has shirt & name tag on 1 Employee knows where to find MSDS info
& 1 Items on sheet found easily 1 All unprocessed go through FIFO area 1 Greet every donor quickly & courteously 1 Emp. Knows emergency procedures & Robbery
Closets 1 Items used have designated locations 1 Donation drive clean and free of clutter 1 Store Quick Sort/process effectively in place 1 Proper lifting techniques practiced
1 No extra or unnecessary tool & equip 1 Employee knows/can explain mission 1 Emp. wears gloves as required
Office 1 Items always returned to proper place Sweep 1 Quick sort warehouse guidelines used 1 No observed saleable merchandise in trash

Sort & Straighten 1 Break table clean Standardize & Sustain Safety & Security
1 Microwave and Fridge clean
1 Personal belongings safe & secure 1 Horizontals clean up to 8 feet 1 5-min drill posted 1 Proper use of any extension cords
2 No unattended open food 1 Soda machine area clean 1 Completes 5-min drill at end of each shift 1 Breaker boxes clear 3ft.
2 No sellable merchandise present 1 Floor swept, mopped, well maintained 1 Minor posting-posted? 1 No hazards (i.e. housekeeping-good/no spills)
1 Kaizen Boards complete and up-to-date 1 Safety information posted and current
Sort & Straighten Sweep 1 All EEOC/OSHA & policy info posted 1 Handbags/backpacks secured in office

1 Inventory control sheet posted 1 All items on floor are assigned a location Standardize & Sustain Safety & Security
2 All items on shelves listed on sheet 1 No items (brooms, mops, etc.) sitting on floor
2 No unauthorized chemicals being used 1 Horizontals clean up to 8 feet 1 Approved supplies being used 1 Floor or isles clear and easy to move around
1 Floor and mop basin clean 2 Each self is labeled for a particular item 2 All chemicals are labled
Sort & Straighten 1 Items organized? 1 Supplies within MIN & MAX's 1 All chemicals noted in MSDS book
1 Wares Label area organized and maintained 1 CSPC/Lead toy binder/Poster utiilzed
2 All merch. Labled & inventoried Sweep
1 All shopgoodwill merch inventoried Standardize & Sustain Safety & Security 0 20 0%
1 No unnecessary items stored in office 2 No clutter on desk
1 Previous weeks PNG order in on time 1 Shelves organized and dusted 1 Minor log posted and up to date 1 Emerg. phone numbers posted (current only)
1 Floor clean/recently mopped (past 2 weeks) 1 Clip board/s information are all current 1 Check first aid kit on weekly basis
0 1 Computer clean and dusted 1 Employee file cabinet is locked 1 Panic button location known
1 Safe locked - NO DAY LOCK 1 OSHA 300 complete & posted thru Apr 30th
30 0 1 Electronic office system in place 1 DVR-Camera work well & positions checked
0%
30 0 0
0%
30 30
0% 0%

Updated 1/1/06, EWP

Sales Floor 6 - S Audit

Register Sort & Straighten 1/0/1900 Standardize & Sustain Safety & Security 0 20 0%
Sweep 0 20 0%
Customer 1 Inventory control sheet posted 1 5-min drill posted & completed each shift 1 Knows emergency procedures (fire/tornado) 0 20 0%
Service 1 Items on sheet found easily 1 Floor clean 1 Bags are properly displayed 1 Employee knows where to find MSDS info 0 20 0%
1 Items used have designated locations 1 Counter clean from stickers/clutter 1 Employee has shirt & name tag on 1 Emp. Knows the "no-bartering policy"
Rest 1 Only tools listed on Inv. Control Sheet 1 No dust on shelves or behind equipment 1 Newspaper is available for breakables 1 Knows how to handle robbery/use panic button
Rooms 1 Items always returned to proper place 1 No sellable merchandise waiting under cash wrap 1 Employee knows/can explain mission 1 Wet floor signs accessible/used properly
1 Power supply free from debris
Fitting Sort & Straighten Standardize & Sustain Safety & Security
Rooms Sweep
1 Smile and great every customer 1 50% off sign posted and in good repair 1 Floor free from debris & no slip hazards
Wares 1 Call for back up if more than 3 in line 1 Front entrance clean and organized 1 Refund policy posted and in good repair 1 All carts have safety straps
Section 1 Handles cust. Issues appropriately 1 No trash on grounds coming into the store 1 Thanks every customer for shopping 1 Front entrance free from obstructions (snow)
1 Knows key Retail policies 1 Trash outside has recently been emptied 1 Display case neat/organized/has signage 1 Emerg. lighting working properly - test
Textile 1 New Approved Signage being used 1 No shopping carts in parking lot unattended 1 Floor employees know/explain mission 1 Emergency exits clear and operable
Section 1 No unnecessary signs or taped signs in window
Sort & Straighten Standardize & Sustain Safety & Security
Sweep
1 Restrooms have men & women signs 1 Air freshener available 1 No bleaches or chemicals present
1 Soap and tissue dispenser full 1 No stickers, flyers, or trash 1 Mirror clean 2 No hazards (i.e slips/falls)
2 Area clean and uncluttered 2 Floors clean and recently mopped 2 Wash hands sign is posted 1 Wet floor sign available and used
1 No extra bathroom tissues or supplies 1 Trash recently emptied 1 Fixtures in good repair 1 Wash hands sign in restroom
1 Toilet/sink clean & walls up to 8 ft
Sort & Straighten Standardize & Sustain Safety & Security
Sweep
1 Structure in good repair 1 5 minute drills completed 1 Doors and locks working properly
1 Mirrors secure from falling 1 No hangers or clothes 2 Returns worked as frequently as needed 2 Bench/seat/chair in good repair
1 No painting needed - good repair 1 No stickers or trash on floor 2 New approved signage being used 2 No hazards (i.e slips/falls)
1 Wall hooks present in each room 1 No barbs on floor
1 Mirrors/bench/signage cauked 1 Top of fitting rooms clean Standardize & Sustain Safety & Security 0 20 0%
1 Mirrors clean? 0 20 0%
Sort & Straighten 1 No sold furniture-past day purchases 1 No broken furniture or hazardous fixtures
Sweep 1 Aisles ADA standard 1 All E&M cords rubber banded or tied
1 Merchandised vertically 1 No display shelves 1 No heavy items placed on top shelf
1 Colorized 1 No dirty glasses & no Ads on mugs/dishes 1 PnG Flexed/Readjusted and balanced 1 No broken wares & area free from spills
1 Wares categorized into each isle 1 Shelving clean & free from stickers 1 Dept 1000 defaced correctly 1 Base decks tied down
1 New Approved Signage being used 1 All product quality met
1 Empl understands purge color system 1 All end caps full of merchandise Standardize & Sustain Safety & Security
1 All PNG items displayed & signed correctly
Sort & Straighten 1 All mens pants suites/jeans have sizes 1 No un-safe H-racks
Sweep 1 H Racks lined up 2 No broken hangers on floor
1 No short sleeve shirts w/ long sleeve 2 Floor more than 90% full 1 Aisles ADA Standard
1 Empl understands purge color system 1 Hangers straight and in place 1 Two signs per row, opposite sides & ends 1 Area free from spills
1 All areas colorized 1 No dust under racks
1 New Approved Signage being used 1 Racks clean 0 0
1 Seasonal set complete 1 Sweep & Spot mop completed 30 30
1 Air intake ducts & lamps cleaned 0% 0%
0
30 0 Safety & Security-Score
0% 30 0
0% 60
0%
Combined Sort & Straighten-Score Sweep-Score Standardize & Sustain-Score
Score: 0
0 0 60
Possible Pts: 60 60 0%
Percent: 0% 0%

Total Avg. Store Score 90 and above exceed expectation
0
0% 80-89 achieved expectation

70-79 below expectation

69 and below immediate action plan

Updated 1/1/06, EWP

COMMENTS:

OK Area Problem Noted Corrective Action Employee Date
Inventory control sheet posted (tote)
Not Ok Hardlines Backroom Items on sheet found easily
Designated locations-silohets/labels
Not Ok Hardlines Backroom No extra/unnecessary tools/equip
Items returned to proper place
Not Ok Hardlines Backroom 5-min drill posted
Completes 5-min drill at end of each shift
Not Ok Hardlines Backroom Horizontals clean up to 8 feet
No food in area
Not Ok Hardlines Backroom Employee has shirt & name tag on it
Employee knows daily prod. goals
Not Ok Hardlines Backroom Wares are properly tagged
Employee knows/can explain mission
Not Ok Hardlines Backroom Community Service in Dress Code/Apron
Wares Coding System in place
Not Ok Hardlines Backroom Employee knows where to find MSDS info
Emp. Knows emergency procedures
Not Ok Hardlines Backroom Needles sanitized each shift
Area taped off
Not Ok Hardlines Backroom Inventory control sheet posted (tote)
Items on sheet found easily
Not Ok Hardlines Backroom Designated locations-silohets/labels
No extra/unnecessary tools/equip
Not Ok Hardlines Backroom Items returned to proper place
5-min drill posted
Not Ok Hardlines Backroom Completes 5-min drill at end of each shift
Horizontals clean up to 8 feet
Not Ok Hardlines Backroom No food in area
Employee has shirt & name tag on
Not Ok Hardlines Backroom Employee knows daily prod. goals

Not Ok Hardlines Backroom

Not Ok Hardlines Backroom

Not Ok Hardlines Backroom

Not Ok Hardlines Backroom

Not Ok Textile Backroom

Not Ok Textile Backroom

Not Ok Textile Backroom

Not Ok Textile Backroom

Not Ok Textile Backroom

Not Ok Textile Backroom

Not Ok Textile Backroom

Not Ok Textile Backroom

Not Ok Textile Backroom

Not Ok Textile Backroom

UpdNatoetdO1k/1/06, EWPTextile Backroom

Not Ok Textile Backroom Employee hs gone thru an Audit w/30 days
Employee knows/can explain mission
Not Ok Textile Backroom Textiles barbed/tagged correctly
Needles sanitized each shift
Not Ok Textile Backroom Employee knows where to find MSDS info
Emp. Knows emergency procedures
Not Ok Textile Backroom Area is clutter free
Area taped off
Not Ok Textile Backroom Inventory control sheet posted
Items on sheet found easily
Not Ok Textile Backroom Items used have designated locations
No extra or unnecessary tool & equip
Not Ok Textile Backroom Items always returned to proper place
All boxes/totes have Dates/Labels/Store #
Not Ok Textile Backroom Textile & Wares separated from each other
Horizontals clean up to 8 feet
Not Ok Donation Backroom All unprocessed go through FIFO area
Donation drive clean and free of clutter
Not Ok Donation Backroom Employee has shirt & name tag on
Greet every donor quickly & courteously
Not Ok Donation Backroom Store Quick Sort/process effectively in place
Employee knows/can explain mission
Not Ok Donation Backroom Quick sort warehouse guidelines used
Employee knows where to find MSDS info
Not Ok Donation Backroom Emp. Knows emergency procedures & Robbery
Proper lifting techniques practiced
Not Ok Donation Backroom Emp. wears gloves as required
Personal belongings safe & secure
Not Ok Donation Backroom No unattended open food
No sellable merchandise present
Not Ok Donation Backroom Break table clean
Microwave and Fridge clean
Not Ok Donation Backroom Horizontals clean up to 8 feet
Soda machine area clean
Not Ok Donation Backroom Floor swept, mopped, well maintained
5-min drill posted
Not Ok Donation Backroom Completes 5-min drill at end of each shift
Minor posting-posted?
Not Ok Donation Backroom Kaizen Boards complete and up-to-date
All EEOC/OSHA & policy info posted
Not Ok Donation Backroom Proper use of any extension cords
Breaker boxes clear 3ft.
Not Ok Donation Backroom No hazards (i.e. housekeeping-good/no spills)
Safety information posted and current
Not Ok Donation Backroom Handbags/backpacks secured in office
Inventory control sheet posted
Not Ok Donation Backroom All items on shelves listed on sheet
No unauthorized chemicals being used
Not Ok Donation Backroom All items on floor are assigned a location
No items (brooms, mops, etc.) sitting on floor
Not Ok Donation Backroom Horizontals clean up to 8 feet
Floor and mop basin clean
Not Ok Donation Backroom Items organized?
Approved supplies being used
Not Ok Break Area Each self is labeled for a particular item
Supplies within MIN & MAX's
Not Ok Break Area Floor or isles clear and easy to move around
All chemicals are labled
Not Ok Break Area All chemicals noted in MSDS book
CSPC/Lead toy binder/Poster utiilzed
Not Ok Break Area All merch. Labled & inventoried
All shopgoodwill merch inventoried
Not Ok Break Area

Not Ok Break Area

Not Ok Break Area

Not Ok Break Area

Not Ok Break Area

Not Ok Break Area

Not Ok Break Area

Not Ok Break Area

Not Ok Break Area

Not Ok Break Area

Not Ok Break Area

Not Ok Break Area

Not Ok Break Area

Not Ok Break Area

Not Ok Supply & Closet

Not Ok Supply & Closet

Not Ok Supply & Closet

Not Ok Supply & Closet

Not Ok Supply & Closet

Not Ok Supply & Closet

Not Ok Supply & Closet

Not Ok Supply & Closet

Not Ok Supply & Closet

Not Ok Supply & Closet

Not Ok Supply & Closet

Not Ok Supply & Closet

Not Ok Supply & Closet

Not Ok Supply & Closet

Not Ok Supply & Closet

Not Ok Office

UpdNatoetdO1k/1/06, EWPOffice

Not Ok Office No unnecessary items stored in office
Previous weeks PNG order in on time
Not Ok Office No clutter on desk
Shelves organized and dusted
Not Ok Office Floor clean/recently mopped (past 2 weeks)
Computer clean and dusted
Not Ok Office Minor log posted and up to date
Clip board/s information are all current
Not Ok Office Employee file cabinet is locked
Safe locked - NO DAY LOCK
Not Ok Office Electronic office system in place
Emerg. phone numbers posted (current only)
Not Ok Office Check first aid kit on weekly basis
Panic button location known
Not Ok Office OSHA 300 complete & posted thru Apr 30th
DVR-Camera work well & positions checked
Not Ok Office Inventory control sheet posted
Items on sheet found easily
Not Ok Office Items used have designated locations
Only tools listed on Inv. Control Sheet
Not Ok Office Items always returned to proper place
Floor clean
Not Ok Office Counter clean from stickers/clutter
No dust on shelves or behind equipment
Not Ok Office No sellable merchandise waiting under cash
Power supply free from debris
Not Ok Office 5-min drill posted & completed each shift
Bags are properly displayed
Not Ok Office Employee has shirt & name tag on
Newspaper is available for breakables
Not Ok Office Employee knows/can explain mission
Knows emergency procedures (fire/tornado)
Not Ok Register-Sales Floor Employee knows where to find MSDS info
Emp. Knows the "no-bartering policy"
Not Ok Register-Sales Floor Knows how to handle robbery/use panic button
Wet floor signs accessible/used properly
Not Ok Register-Sales Floor Smile and great every customer
Call for back up if more than 3 in line
Not Ok Register-Sales Floor Handles cust. Issues appropriately
Knows key Retail policies
Not Ok Register-Sales Floor New Approved Signage being used
Front entrance clean and organized
Not Ok Register-Sales Floor No trash on grounds coming into the store
Trash outside has recently been emptied
Not Ok Register-Sales Floor No shopping carts in parking lot unattended
No unnecessary signs or taped signs in window
Not Ok Register-Sales Floor 50% off sign posted and in good repair
Refund policy posted and in good repair
Not Ok Register-Sales Floor Thanks every customer for shopping
Display case neat/organized/has signage
Not Ok Register-Sales Floor Floor employees know/explain mission
Floor free from debris & no slip hazards
Not Ok Register-Sales Floor All carts have safety straps
Front entrance free from obstructions (snow)
Not Ok Register-Sales Floor Emerg. lighting working properly - test
Emergency exits clear and operable
Not Ok Register-Sales Floor Restrooms have men & women signs
Soap and tissue dispenser full
Not Ok Register-Sales Floor Area clean and uncluttered
No extra bathroom tissues or supplies
Not Ok Register-Sales Floor No stickers, flyers, or trash
Floors clean and recently mopped
Not Ok Register-Sales Floor

Not Ok Register-Sales Floor

Not Ok Register-Sales Floor

Not Ok Register-Sales Floor

Not Ok Register-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Customer Service-Sales Floor

Not Ok Restrooms

Not Ok Restrooms

Not Ok Restrooms

Not Ok Restrooms

Not Ok Restrooms

UpdNatoetdO1k/1/06, EWPRestrooms

Not Ok Restrooms Trash recently emptied
Toilet/sink clean & walls up to 8 ft
Not Ok Restrooms Air freshener available
Mirror clean
Not Ok Restrooms Wash hands sign is posted
Fixtures in good repair
Not Ok Restrooms No bleaches or chemicals present
No hazards (i.e slips/falls)
Not Ok Restrooms Wet floor sign available and used
Wash hands sign in restroom
Not Ok Restrooms Structure in good repair
Mirrors secure from falling
Not Ok Restrooms No painting needed - good repair
Wall hooks present in each room
Not Ok Restrooms Mirrors/bench/signage cauked
No hangers or clothes
Not Ok Restrooms No stickers or trash on floor
No barbs on floor
Not Ok Restrooms Top of fitting rooms clean
Mirrors clean?
Not Ok Fitting Rooms-Sales Floor 5 minute drills completed
Returns worked as frequently as needed
Not Ok Fitting Rooms-Sales Floor New approved signage being used
Doors and locks working properly
Not Ok Fitting Rooms-Sales Floor Bench/seat/chair in good repair
No hazards (i.e slips/falls)
Not Ok Fitting Rooms-Sales Floor Merchandised vertically
Colorized
Not Ok Fitting Rooms-Sales Floor Wares categorized into each isle
New Approved Signage being used
Not Ok Fitting Rooms-Sales Floor Empl understands purge color system
No dirty glasses & no Ads on mugs/dishes
Not Ok Fitting Rooms-Sales Floor Shelving clean & free from stickers
All product quality met
Not Ok Fitting Rooms-Sales Floor All end caps full of merchandise
All PNG items displayed & signed correctly
Not Ok Fitting Rooms-Sales Floor No sold furniture-past day purchases
Aisles ADA standard
Not Ok Fitting Rooms-Sales Floor No display shelves
PnG Flexed/Readjusted and balanced
Not Ok Fitting Rooms-Sales Floor Dept 1000 defaced correctly
No broken furniture or hazardous fixtures
Not Ok Fitting Rooms-Sales Floor All E&M cords rubber banded or tied
No heavy items placed on top shelf
Not Ok Fitting Rooms-Sales Floor No broken wares & area free from spills
Base decks tied down
Not Ok Fitting Rooms-Sales Floor No short sleeve shirts w/ long sleeve
Empl understands purge color system
Not Ok Fitting Rooms-Sales Floor All areas colorized
New Approved Signage being used
Not Ok Fitting Rooms-Sales Floor Seasonal set complete
Hangers straight and in place
Not Ok Wares-Sales Floor No dust under racks
Racks clean
Not Ok Wares-Sales Floor Sweep & Spot mop completed
Air intake ducts & lamps cleaned
Not Ok Wares-Sales Floor All mens pants suites/jeans have sizes
H Racks lined up
Not Ok Wares-Sales Floor Floor more than 90% full
Two signs per row, opposite sides & ends
Not Ok Wares-Sales Floor 0
No un-safe H-racks
Not Ok Wares-Sales Floor

Not Ok Wares-Sales Floor

Not Ok Wares-Sales Floor

Not Ok Wares-Sales Floor

Not Ok Wares-Sales Floor

Not Ok Wares-Sales Floor

Not Ok Wares-Sales Floor

Not Ok Wares-Sales Floor

Not Ok Wares-Sales Floor

Not Ok Wares-Sales Floor

Not Ok Wares-Sales Floor

Not Ok Wares-Sales Floor

Not Ok Wares-Sales Floor

Not Ok Wares-Sales Floor

Not Ok Wares-Sales Floor

Not Ok Textile-Sales Floor

Not Ok Textile-Sales Floor

Not Ok Textile-Sales Floor

Not Ok Textile-Sales Floor

Not Ok Textile-Sales Floor

Not Ok Textile-Sales Floor

Not Ok Textile-Sales Floor

Not Ok Textile-Sales Floor

Not Ok Textile-Sales Floor

Not Ok Textile-Sales Floor

Not Ok Textile-Sales Floor

Not Ok Textile-Sales Floor

Not Ok Textile-Sales Floor

Not Ok Textile-Sales Floor

Not Ok Textile-Sales Floor

UpdNatoetdO1k/1/06, EWPTextile-Sales Floor

Not Ok Textile-Sales Floor No broken hangers on floor
Not Ok Textile-Sales Floor Aisles ADA Standard
Not Ok Textile-Sales Floor Area free from spills

Updated 1/1/06, EWP



THE Gi KAIZEN METHOD

HOW YOU CAN TRANSFORM MORE
DONATIONS INTO SALEABLE MERCHANDISE

QUICKLY

AT NO EXPENSE

AND SIMULTANEOUSLY IMPROVE MORALE
AND SAFETY AMONG YOUR STAFF

By
John Miller, Chief Executive Officer
Vickie Volpano, Senior Vice President – Retail Operations
John Poole, Vice President – Commercial Services
Goodwill Industries of Southeastern Wisconsin and Metropolitan Chicago, Inc.

Over the past eight months, the process of turning donations into saleable merchandise in this
Goodwill has been transformed. We have completely changed our approach, and in doing so,
we have dramatically increased sales, found added work space in crowded quarters, improved
employee morale and enthusiasm, and improved safety conditions. Best of all, the new
approach did not cost hundreds of thousands of dollars in consultant fees, new equipment, or
remodeling. The biggest investment was time – setting aside a few days at each store to make
the transition.

We are so impressed with the success of this new approach that we want to share it with you.
This method works anywhere, in any type of business or occupation. It is particularly applicable
to Goodwill’s unique task of collecting and reselling donated goods to the retail public.

What is Gi Kaizen?

Loosely translated, the word, “kaizen” is Japanese for “continuous improvement.” The word,
“Gi” is Japanese for Goodwill.

The kaizen method was developed in Japan in recent years and first used in the automobile
manufacturing industry. It is catching on in America because it involves a simple, practical
approach to the goal of “process improvement.”
Its two major components are:

 Five S Workplace Organization (Sort, Straighten, Sweep, Standardize, and
Sustain)

 Cellular Production (Creating standardized, streamlined work cells that concentrate
on activities that add value to the job at hand and eliminate activities that do not)

Like many organizations, we have been committed to process improvement for several years.
However, previous consultants and exploration of other approaches resulted in suggestions that
would be far more costly, complicated, and difficult to maintain over the long term. We have
found the kaizen method to produce rapid, sustainable improvement in donated goods
processing.

How did we apply the Gi Kaizen approach to Goodwill stores?

Each of our 15 store/donation centers held two or more “Gi Kaizen events.”
A Gi Kaizen event takes three to four days. Each event gathered a team of 10 to 20 people.
About half of the team were store managers and employees; half were non-retail Goodwill staff,
who were able to offer an outside perspective. Selection of this type of cross-functional team is
important, and differs from traditional “best practices” or “benchmarking” team selection
processes.

 In the morning of Day 1, the team learns Gi Kaizen principles and applications of 5S
Workplace Organization and Cellular Production.

 During the afternoon of Day 1, the team begins the 5S Workplace Organization process by
Sorting, Straightening, and Sweeping.
Sorting is segregating and discarding all unnecessary items from the production
environment. “When in doubt, throw it out!” or “Sell It!” Straightening is arranging remaining
items and identifying their proper location. “A place for everything and everything in its
place.” Sweeping is cleaning the workplace of debris.

 On Day 2 ,the team maps and measures its current donation processing methods in terms
of both time and distance. This process identifies waste and allows the team to redesign
the process focusing on activities that add value to the operation, while eliminating actions
that waste time.

 On Day 3, the team continues the 5S Workplace Organization by Standardizing and
Sustaining the reorganization of the workplace that was accomplished the day before.
Standardizing means frequently revisiting the sorting, straightening, and sweeping to
generate new improvements. Sustaining is developing visual performance measurement
tools that will promote adherence. Additionally, the team maps and measures the new
standard work process for improvement in preparation for a team presentation.

 On Day 4, the team prepares, practices, and presents a team presentation outlining their
activities from the previous three days and communicating the measurable results of these
activities. Store and donations staff who did not participate in the process attend the
presentation, as do managers and leadership from throughout the Goodwill organization.
The presentation develops the team’s confidence in communicating the merits of the Gi
Kaizen process, and helps build an organization-wide culture of continuous improvement.

What were the results?

We now have less cluttered, cleaner, more rational workplaces at all of our stores, which has
resulted in improved morale, higher productivity and more efficient use of space. Year-to-date,
our 33-year-old Plant Store has produced 11% more sales than it did in the first seven months
of 1999. Transactions are only up 1.3%, but sales per transaction are up 9.5%.

Gi Kaizen has impacted both sales and margins. Through July 2000, Retail Operations
performance is improved over 1999 with revenues up $1.8 M and margins increased by
$936,000.

Donations employees report that they are able to work faster and no longer have to break away
from their tasks to move carts of clothing out of the way, etc. One employee, who uses a cane
due to a disability, commented that she is glad the floor is now clear of clutter.

Can these results really be sustained?

Yes.

Case in point: On Saturday, January 22, 2000, the back of our Plant Store was its usual
beehive of activity. About 20 store processing personnel, the store manager, and the assistant
manager were getting the store ready to open at 9 a.m. The back room was so crowded that in
many areas you needed to turn sideways to move around. We seemed to be flooded with
donations. Material handling equipment was stacked everywhere, and the adjacent dock area
was similarly crowded.

During the following week, the first Gi Kaizen event was held, focusing on the donation-to-rack
process. Afterward, management took a tour of the store’s back room. We were astounded by
the vast amounts of open space and the transformation of the processing effort. There was,
however, considerable skepticism that the changes were sustainable. We agreed that we would
all meet on February 29 to take the same tour. The next day, we met with Cora Stellpflug and
Judy Dykstra, the manager and assistant manager of our Plant Store. As we stood in the neatly
organized, clearly labeled, orderly, quiet processing area, looking at more open than occupied
space, Cora, who has worked for us for more than 15 years, and Judy who has more than 20
years of service, commented that “there seemed to have been a big slowdown in donations”
over the past week. In fact, they themselves had brought about the dramatic changes in the
workplace by streamlining operations.

Our initial skepticism proved to be unfounded. The positive changes in our Plant Store were
sustained. We have been through peaks in our donation cycle on Memorial Day and July 4, and
every time we visit that back room it still works.

There has been another Gi Kaizen event at this store, and there will be more in the future,
because this is about continuous, not just one-time improvement.

Gi Kaizen from three individual perspectives:

We would like to discuss Gi Kaizen from the perspectives of the executive charged with
process improvement, the executive responsible for the donated goods operation and the chief
executive. These perspectives are important because Gi Kaizen requires both
leadership and commitment. It creates changes in operations that cannot be imposed on
workers but which they can and will adopt for themselves if they see that the commitment of
management at all levels is sincere. In addition, management must provide the tools that
workers and supervisors require to improve their workplace and productivity. Finally,
management must lead by example.

A CEO’s perspective
By John L. Miller

Goodwill Industries of Southeastern Wisconsin and Metropolitan Chicago, Inc. has been
collecting and selling donated goods for 81 years. In the late 1980s, we shifted from central to
on-site processing and adopted the store/donation center model. But like most Goodwills that
went through this transition, our stores lacked the docks, back room space and other
characteristics of a true store/donation center. Typically, the processing centers (which
occupied about one-third of the space in each unit) were run as each individual manager saw fit.

The Gi Kaizen process has brought to light the difference between retailing and
manufacturing. Goodwills often seek out store managers and donated goods executives who
have considerable experience in retailing. These individuals generally come to Goodwill with a
blind spot. They assume that material in the back room of the store is saleable! This
assumption arises from the simple reality that in a department store, a chain discount store, or
any supermarket there is a back room with merchandise waiting to be displayed, all of which is
saleable. Some of it has to be ticketed, but decisions as to its salability have been made
elsewhere. This is not true in most contemporary Goodwill stores. An insight we gleaned from
our experiences with Gi Kaizen is that the preparation of materials for sale in our stores is a
manufacturing process and must be managed as such. The principles of Gi Kaizen are not
only useful, but in fact, critical to successful extraction of value from our donations.

In the past, our management has solicited proposals from consulting firms to lead a process
improvement effort in our donated goods system. The proposals we received were not
particularly compelling and very expensive, ranging up to $250,000 for a 9-month effort. Not
liking the alternatives we had seen, we made a decision in November 1999 to hire an individual,
John Poole, who had never worked in a retail setting in his life and who had no responsibility
other than to improve processes in the organization, beginning in the Retail Division.

No management effort we have made in Goodwill has ever produced as much positive
change as rapidly as this one. Based on our familiarity with other Goodwills, we believe these
principles can be applied immediately and at no cost to any Goodwill anywhere and will effect
an immediate improvement in operations. They will look better, be more organized, cleaner and
produce measurable financial improvement.

The best thing about Gi Kaizen is that it is free. It is a set of ideas, and hence transferable at
the speed of thought. We have already introduced these concepts to colleagues from Goodwill
Industries of Central Indiana, North Central Wisconsin, and Portland, Oregon, and have no
doubt that they can and should spread throughout all Goodwills.

Of course, this applies not just to the back rooms of our stores, but to all our processes. We
experimented with using the Gi Kaizen method in our Human Resources department. We
focused on one task: completion of a personnel file for each new employee that meets
regulatory compliance. Throughout my tenure, this process has taken about four weeks to
complete. When we analyzed the steps involved with a Gi Kaizen team, we found it actually
should require just three days. We have set a target of having the entire file for each new hire
completed in four days, and have made great progress toward that. We are now at seven days
on average, and declining.

A Retail Executive’s Perspective
By Vickie Volpano

“A place for everything and everything in its place.” - Mother
“Change is good!” – Mother Nature

As a 14-year Goodwill associate, allow me to share my perspective on how Gi Kaizen can
assist in our shared interest to have Goodwill Industries, and specifically our donated goods
programs, thrive.

It was mid-1986 when I came to Goodwill from a national retailer. Store sales have since grown
six times from $2.8M to over $17M this year and store presentation is greatly improved.
However, our donated goods production improvement efforts were neither complete nor
comprehensive. In retrospect, there was well-veiled opportunity in the deplorably low salvage
prices of 1998 and 1999. We have since gained some appreciation for lessons learned and for
opportunities that emerged (at least in part) from those difficult times. During this period of
intense “character building,” we were compelled to focus on the margins our store operations
were—or were not—generating.

Our donated goods operations simply were not as efficient as they could and needed to be. We

made progress, but never reached a level of proficiency in the production of donated goods that

translated to improved bottom-line performance—until now.

In the last eight months we have certainly not gained every insight needed to run a successful
donated goods program. But we have clearly benefited greatly from applying Gi Kaizen, 5-S
Workplace Organization, and Cellular Production principles in the workplace.

In addition to improving bottom line performance, Gi Kaizen improves operations in other

fundamental ways. First, Gi Kaizen is a true workforce development tool. Its

implementation is not a one-time shot through operations with “best practices” prescribed

and mandated by management. Rather, Gi Kaizen, 5-S Workplace Organization, and

Cellular Production are tools and philosophies. And in the true spirit of Goodwill and

workforce development, it is the participants and employees whom we serve and work

alongside with who discovered and implemented real solutions to the challenges of

operations.

Secondly, Gi Kaizen encourages creativity before capital. As mentioned earlier,

implementation does not take significant resources—it is essentially free. What is required

is a more precious commodity, the investment of time. As with any process improvement

initiative, Gi Kaizen does require a significant investment of people and the commitment of

management.

To remain relevant in an increasingly competitive donation and retail market, we must
ceaselessly improve our operations. To increase funds to support the mission and good work of
Goodwill, we must ceaselessly improve the productivity of our operations. And Gi Kaizen can
help.

The Process Improvement Executive’s Perspective
By John Poole

The Gi Kaizen event is conducted with an understanding of the following two axioms:

1. Bias for action.
2. Creativity before capital.

Having a sense of urgency drives change in an organization by identifying, addressing, and
taking immediate action at all levels to make improvements. Previously described dissatisfaction
with Retail Operations performance and the need to overcome the drop in salvage prices
provided the sense of urgency to motivate Goodwill to improve its donations processing
activities, so as to more quickly turn donated items into saleable merchandise. This provided
the “bias for action.”

Because the process of reselling donated items is inherently wasteful, we must look for
improvements using existing resources. A focus on waste reduction generates capacity and
may resolve any need for capital spending. In this case, we were able to improve use of space
in the areas of stores dedicated to donations processing, which eliminates the need for
expensive renovation or expansion. This illustrates “creativity before capital the future of Gi
Kaizen in Goodwill’s retail operations will be the integration of product and information
throughout the entire Value Delivery System, continuously improving quality, cost, and
response.