In today's complex and turbulent environments the need for continuous impro
vements in products and processes is widely recognised. But the mechanisms
whereby such a continual stream of innovation can be achieved are often les
s clearly identified. One option is to mobilise a high proportion of the wo
rkforce in a process of sustained incremental problem-solving, but experien
ce with this approach suggests that successfully doing so is far from simpl
e. Although many programmes for 'kaizen' or 'continuous improvement' based
on employee involvement are started, the failure rate is high. This paper r
eports on extensive case-study based research exploring how high involvemen
t in continuous improvement can be built and sustained as an organisational
capability. It argues that this phenomenon needs to be viewed as a cluster
of behavioural changes which establish innovation routines in the enterpri
se, and presents a reference model for assessment of progress in the evolut
ion of such capability. (C) 2000 Elsevier Science Ltd. All rights reserved.