Recently I completed the Lean Six Sigma Black Belt for Service Industry training of The Lean Six Sigma Company (http://www.theleansixsigmacompany.nl/). This was reason for me to write an article about what Lean Six Sigma is.
Lean Six Sigma consists of two methods which are combined. In the first place Lean, which started as the 'Toyota Production System' between 1948 and 1975. Leans aims at simplifying of production processes by looking at waste. After the Second World War Toyota had to compete with the big US car manufacturers with a shortage in money or machines. General Motors and Ford used several expensive and big production lines each making one type of car. Toyota was limited in the number of production lines where several types of cars had to be produced. Toyota could only compete when it could develop a rapidly changeable production where more than one type of car could be produced for the same costs as in the USA. After ten years this resulted in a rapid and efficient way of converting the manufacturing process, low stocks, high quality and small batches.
Six Sigma is the second method of the two, consisting from a set of techniques and tools for process improvement. It was developed in 1985 at Motorola. Six Sigma seeks to improve the quality of process outputs by identifying and removing the causes of defects (errors) and minimizing variability in manufacturing and business processes. It uses a set of quality management methods, including statistical methods, and creates a special infrastructure of people within the organization ("Champions", "Black Belts", "Green Belts", "Yellow Belts", etc.) who are experts in these methods.
The Lean Six Sigma concept was first introduced in the book 'Lean Six Sigma: Combining Six Sigma with Lean Speed' from Michael George and Robert Lawrence Jr. in 2002. The Lean Six Sigma method sees Lean Manufacturing and Six Sigma as complementary methods. Lean Manufacturing focuses on process flow and waste within the process and Six Sigma emphasises variation in the process and the design of the process.
Lean and Six Sigma can be combined into a powerful method: a business Improvement method which improves stockholders value by fast improvement in costs, quality and customer satisfaction. It aims on the reduction of waste inside the processes by streamlining these processes and reducing waste. Waste can also be found within services not delivered on time or within budget.
In business a lot of experience is made with the positive contribution of Lean Six Sigma on operating profit. The great strength of Six Sigma lies in the combined approach. In particular Six Sigma complements Lean in three ways. In the first place Six Sigma could provide cultural infrastructure and senior management commitment that sometime Lean initiatives are unable to generate. Secondly, Six Sigma takes a customer focused view as the target of its activities. Lastly, Lean tools and techniques are unable to reduce variation.
Lean also complements Six Sigma. Firstly Lean can be used to identify non value added activities. Any activity that doesn't add to the market form or function of the product (things for which the customer is willing to pay) is a non-value added activity. Next Lean improves the responsiveness in and speed of processes. In the third place Lean has a group of robust tools focussed on increasing speed and rapid response to improvement. Lastly organisations only implementing Six Sigma or Lean might exhibit diminishing productivity returns. Implementation of Lean Six Sigma helps to boost the company productivity.
The economy in The Netherlands will improve in the short term. Organisations will get more orders that have to be fulfilled with the current workforce. Pressure on these people will increase. Lean Six Sigma allows an organisation to get more done in the same time while bringing the number of defects down. Lean Six Sigma ensures that your company will be prepared for the future.
If you want to talk about the introduction of Lean Six Sigma within your company, please contact me.