Business | Lean Methodology
Lean Six Sigma – Collaborating to improve performance
Lean Six Sigma – Collaborating to improve performanceBack
Last week we looked at the origins of lean methodology and some of its core concepts. This week we want to dive into a development of those ideas and their melding with the concepts behind Six Sigma; ultimately creating the methodology known as Lean Six Sigma.
What is the concept of Six Sigma?
Six Sigma is a tool for improving processes. It began in the manufacturing world with Bill Smith, an engineer for Motorola in the 1980s. The concept revolved around ensuring that any manufacturing process produced fewer than 3.4 defects per million defect opportunities.
The name itself relates to the notion that there are six standard deviations between the mean and and the nearest specification limit. As the mean moves away from the centre of tolerance, the chance of defects occurring increases.
And so, Six Sigma seeks to create processes that result in the mean remaining as close to the centre of tolerance as possible, maintaining those six standard deviations and resulting in as few defects as possible. A process where 99.99966% of opportunities to produce a feature are statistically expected to be free from defects is a Six Sigma process.
Is lean methodology the same as Six Sigma?
While they have similar aims, improving processes to achieve greater quality with minimised waste, lean and Six Sigma are different. The primary difference being how they identify and categorise waste.
The primary goal of lean is to reduce cycle time, resulting in higher output and greater value for the customer. The main waste in lean is time.
For Six Sigma, waste is eliminated by aiming for a perfect, or as near perfect as possible, product. By minimising defects, the final product is one which results in minimal waste.
While both methodologies have a similar goal, when they’re combined into Lean Six Sigma that goal starts to be achieved in remarkable ways.
What are the origins of Lean Six Sigma?
While lean methodology and Six Sigma were developed separately, in Japanese and American manufacturing respectively, their combination into Lean Six Sigma actually happened within the growth of Six Sigma.
It developed as an idea in Six Sigma, incorporating concepts from lean manufacturing, and branched off as its own separate discipline during the 2000s. Since then it’s found its way into industries ranging from healthcare to finance and from software development to supply chain.
What are the five principles of Lean Six Sigma?
- Focus on your customer
- Identify and understand problems
- Minimise defects and bottlenecks
- Communicate with, educate, and properly equip your team
- Be flexible, adaptable, and responsive
These five principles combine the best of both lean methodology and Six Sigma. From the roots of lean methodology you have the customer centric focus and the support and inclusion of your whole team.
From Six Sigma you have the focus on minimising defects. And, of course, from both you have concepts that cross over and are compatible in the extreme.
Focus on your customer
In this context the concept can be traced back to the Toyota Production System (TPS). With the customer as your main focus, you map your processes around what is going to provide them the most benefit, not what you think might produce the most revenue.
The old adage ‘the customer is always right’ rings true again here. By putting the customer at the centre of your designs, you are able to cut any wasted energy or resources that don’t create value adds for them.
Identify and understand problems
Here we can look at the idea of Jidoka, or “automation with a human touch”. In the TPS, production was stopped when a fault was detected. This meant rapid recognition of, understanding of, and resolutions to problems were a necessity.
This develops into the Lean Six Sigma approach to identifying, understanding and solving problems. This doesn’t necessarily mean stopping the production lines for any potential problems, but instead it’s about designing production processes that result in less than a handful of defects per million defect producing opportunities.
Minimise defects and bottlenecks
At this point, the first two concepts are put into practice. Processes are mapped and managed based on collected data and real world analysis. Production is carried out in a way that ensures minimal defects are produced, minimal waste is created, and maximum value is delivered to the customer.
Communicate with, educate, and properly equip your team
Much like the idea behind Kaizen, this principle places importance on your entire team. Without the understanding and belief that each person involved with delivering value to the customer is as important as each other, Lean Six Sigma falls down.
Innovation can come from anywhere, success can come from anywhere, and waste can come from anywhere too. That can ultimately result in less value for the customer in relation to resources spent.
By properly communicating with, educating and equipping your team, everyone can be involved in achieving the goals of Lean Six Sigma.
Be flexible, adaptable, and responsive
The final principle relates to each of the preceding ones and is arguably the most important. As Rabbie Burns once said, “The best-laid plans of mice and men go oft awry”. In other words, your perfectly planned process might not achieve the result you want it to.
The goal is to minimise waste, to maximise value for the customer, and to create processes that achieve that. But the factors that decide on each element change on a daily, monthly, yearly basis. What’s true of your industry today might not be true of your industry next year, or even next week.
When you put into place a process that you think will minimise waste, but instead some unforeseen circumstance jumps into to make your best-laid plan go awry, you need to be flexible.
Equally, that perfect process you’ve put in place that has produced stellar results for years, will eventually become outdated. When it does, you have to respond, investigate what’s changed, be flexible, and adapt to the new paradigm. That’s the way of Lean Six Sigma.
Thank you again for joining us on this journey into lean. Next, we’re going to start looking at the eight types of waste that Lean Six Sigma aims to eliminate.