Ghana’s micro businesses are being encouraged to use Kaizen, the Japanese philosophy of continuous improvement, to overcome limited finance, inefficient production and weak management systems.
Micro, small and medium-sized enterprises (MSMEs) account for more than 90 per cent of registered businesses and provide about 80 per cent of employment in Ghana. Micro enterprises alone represent 90.4 per cent of establishments, up from 16.6 per cent in 2014, and contribute about 70 per cent of Gross Domestic Product.
The sector is largely informal, women- and youth-led, and often operates from pavements, roadside stalls or mobile facilities. The Integrated Business Establishment Survey found that 92.3 per cent of Ghanaian businesses remain informal, while about 31 per cent of operators earn GH¢100 or less per day.
Under Legislative Instrument 2470, the Ghana Enterprises Agency (GEA) defines a micro enterprise as one with 1 to 5 permanent employees and either fixed assets or annual turnover of no more than GH¢150,000. Small enterprises employ 6 to 30 permanent workers and have assets or turnover between GH¢150,000 and GH¢6,000,000.
Kaizen has been promoted in Ghana since 2012 through cooperation between the GEA, the United Nations Industrial Development Organization (UNIDO) and the Japan International Cooperation Agency (JICA).
Seven ways Kaizen can support growth
The first step is workplace organisation through the 5S system: Sort, Set in Order, Shine, Standardise and Sustain. JICA research says the approach requires little investment and is suitable for micro and small firms.
A gari producer in Mampong, Ashanti Region, divided and labelled areas for washing, peeling, processing and pressing. The changes cut unnecessary movement and increased output from one and a half bags a day to three.
Kaizen also targets seven forms of waste: overproduction, waiting, transportation, over-processing, inventory, motion and defects. A garments business in Takoradi, after UNIDO training in 2024, reorganised its tools and layout, introduced straight-line production and allocated specialist tasks including pattern cutting. It reduced waste, improved consistency and invested in a fabric-printing machine. Its workforce grew from 17 to 26, mainly women.
Staff involvement is another central principle. Visual target boards and a suggestion box helped the garments company involve employees in daily improvements. Research in Ghana’s garment industry identifies worker training, development, leadership commitment and the physical workplace as key factors in successful implementation.
Kaizen further encourages businesses to measure performance rather than rely on instinct. UNIDO projects introduced the Smart and Sustainable Agri-Business (SSAB) dashboard and U-SPARK technology. More than 2,800 enterprises, half women-led, improved their enterprise performance management.
Consistent quality can help micro firms enter formal markets, win larger contracts and charge higher prices. A body-soap and cream producer won the Micro and Small Enterprise category and was named overall winner of the 2024 National Kaizen Awards after crediting Kaizen with improving productivity and operations.
Owners must treat the method as a continuing management system, not a single training session. Institutional support is available through the GEA, JICA, UNIDO and more than 209 Business Advisory Centres. The GEA has trained over 33,478 micro and small enterprises through programmes including Mastercard Foundation’s Young Africa Works, the Ghana Jobs and Skills Project and the BizBox Project.
The International Labour Organization has also found that combining its Start and Improve Your Business (SIYB) programme with basic Kaizen elements improves the performance of small firms.
Since the UNIDO Kaizen Expansion Project began in 2022, more than 200 enterprises have improved productivity, quality and efficiency. A further 142 firms improved productivity, energy efficiency and waste reduction, while businesses adopted 40 new technologies.
Ghana’s Deputy Minister for Trade, Agribusiness and Industry has called for Kaizen to become a permanent GEA service. With the agency seeking to become a West African centre of excellence, the approach offers micro businesses a low-cost route to formalisation and sustainable expansion.
