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Oct

Is Lean and Six Sigma a waste of time?

Posted by: business901 | Comments (0)

Most large manufacturers last year failed to reach their cost-savings targets, despite significant investments in “lean manufacturing,” “Six Sigma” and other productivity programs as part of their overall retrenchment efforts in this tepid economy. Nearly 70% of manufacturing executives say that their manufacturing-improvement efforts led to a reduction in manufacturing costs of less than 5%, the typical minimum threshold for successful productivity programs. That’s according to a survey of manufacturing executives conducted in May and June by AlixPartners, the global business-advisory firm.

“At their core, continuous-improvement programs must include clear priorities based on the expected financial impact,” said Andrew Csicsila, director in AlixPartners’ Manufacturing Practice. “Yet, there remains a pervasive misunderstanding that simply focusing on ‘lean’ and ‘Six Sigma’ processes alone will be the magic fix. Ultimately, it’s not about chasing a process or philosophy. It’s about the cash.”

Can this be true? I am a proponent of Lean and adhere to most of the underlying philosophies that it exhorts. However, I go off on a rant sometimes when I hear that we are always supposed to “wait” for improvements to prove their effectiveness. It is all about culture, you will hear echoed by the top-level consultants. (I always thought it might have been because culture pays betters – sorry just a joke). It seems to always fall back that Leadership is shortsighted and not patient enough, even if it does mean their jobs.

I think improvement efforts should be based on results in the marketplace. In my blog post last week, The Death of PDCA that stated following traditional Lean thinking leads us to focus our efforts of continuous improvement internally versus externally. We are constantly trying to improve internal processes making them more and more efficient. Many companies are seeing little change or improvement from these efforts over their competitors and in the marketplace. Business is Business. If it is not about succeeding in the marketplace and in a crass way cash, what is it about? I hate to take it down to this level because I hold corporations and myself to higher standards than this but let’s face it, if you are not making money, you cannot be effective at what you do.

On one side of the fulcrum we have products and services supported by internal processes and on the other side of the fulcrum are customers or the demand side. There has been a significant shift in the marketplace and at the moment the customer is in control. Supply exceeds demands. However, continuous improvement seems to be still stuck on the wrong side of the fulcrum, the internal processes.

We do not live in a world of excess demand. The strategies that we need for improvement need to be focused on the demand side, the customer. These efforts of continuous improvement must be focused on moving ourselves along the path of our customers. Do you wonder how that path is shaped? A brief synopsis is that path is shaped initially by understanding the knowledge gaps that exist between you and your customers. As that knowledge is shared and made explicit the gaps close and eventually the power of the two organizations is realized. It is in the spirit of Service Design and Innovation that these thoughts will flourish.

Looking back at the beginning of the quality movement can you remember this types of all too common of a scenario described by Tim Ogilvie, CEO of innovation strategy consultancy Peer Insight and co-author of a new book Designing for Growth: A Design Thinking Toolkit for Managers: “We had a VP of production and a VP of quality, and they had an argument on the loading dock on the 30th of the month as to whether we we’re going to ship that order or not. And the VP of quality said, “It’s not high enough quality because I inspected it.” And the VP of production said, “I got to make my order.” It was an adversarial system, and here we are 25 years later and the quality is all baked in because at our workstation we self-inspected and we fulfilled with a Kanban, and we got single minute exchanges. All of these amazing breakthroughs have happened in that time period.”

It is the time for continuous improvement to start tackling the demand side the equation. It is not going to be an overnight success but small gains of moving from frameworks such as cooperation and joint ventures to co-producing and co-creation or platforms of customer-centricity to user-centricity are the starting points. This is the one of the few ways that you can create and sustain demand. And with demand comes increased revenue and market share that can be measured. Without doing this your company may flounder and the results may not be very forgiving.

Data Driven Problem Solving Program

Posted by: business901 | Comments (0)

Steven C. Wilson, one of the leading Lean Six Sigma trainers in the state of Iowa has released a new program, Data Driven Problem Solving. The entire program can be downloaded as a PDF and MP3 on IowaQualityTraining.com.

Data Driven Problem Solving includes a 100 page book with over 4 hours of audio. In addition, a copy of Lean Six Sigma for Leaders book is included. The Data Driven Problem Solving program is a result of material covered in a 2-day workshop presented by the author Steven C. Wilson. It was created to support the training both before and after the class. It provides many of the questions people had about problem solving utilizing DMAIC. You do not need to fully comprehending the tools of Six Sigma. With an understanding of Data Driven Problem Solving, it will allow more participation in your organization’s problem solving efforts.

Data Driven Problem Solving uses activities based approach and is comprised of multiple separate sessions, which follow the Six Sigma DMAIC approach without the need of the typical Black Belts, Green Belt hierarchy associated with Six Sigma organizations. It is presented in a unique question and answer format providing information about how to use and implement a problem solving methodology in an organization.

Topic that are covered:

Process Improvement Basics
Roles and Organization – Teamwork
What is Our Quest? – The Define Phase
How is the Current Process Performing? – Measure Phase
What are the “Deep Dive” Causes of a Problem? – Analyze Phase
What will We Change? – Improve Phase
Are We There yet? – Control Phase

About: Steven C. Wilson is the host of Quality Conversations and can be found at Wilson Consulting and Training Services, Inc (WCTS, Inc – www.stevencwilson.com). Wilson has over 20 years of experience applying quality improvement tools, methodologies, and principles in a variety of industries that include automotive, healthcare, logistics, distribution, education, and numerous manufacturing venues. He has dedicated himself to the cause by training/coaching over 600 Six Sigma practitioners in over 70 companies with an emphasis on getting results. Wilson possesses a very engaging style of leadership, training and consulting, and provides an experienced eye for companies on the road to organizational improvement.

Program is also available on Amazon:
Ring Bound:Data Driven Problem Solving
CD Format: Data Driven Problem Solving

Lean or Six Sigma which fork in the road do you take?

Posted by: business901 | Comments (4)

People will see my comments floating around the Internet on the subject of Lean Six Sigma. I am not an expert and probably take too much liberty in the application of them to even proceed but it was important to me to basically post my view.

There will always be a strong debate between Lean and Six Sigma people about using the 2 terms jointly. I am not positive of the lineage of it but I believe Michael George at the time of the George Group (later to be Accenture) coined the term. I assume he viewed the two methodologies as compatible and more effective in conjunction with each other versus separately. I am not even sure that many (Case in point being that many of today’s “Lean” consultants were trained as Lean Six Sigma Black Belts) disagreed at the time except for the very traditional Lean stalwarts.

Dr. Mikel Harry, credited as one of the founders of Six Sigma states that Six Sigma is not a culture and was developed as a quality tool to gain breakthrough performance for an organization. I adhere to that statement and think Six Sigma offers great opportunities for an organization and provides a very precise and workable structure in achieving this. I am not against the hierarchy of belts and the formalities of DMAIC, DFSS, etc. Many organizations need this type of structure to be successful. I am avid defender of Six Sigma in the Lean circles many times to the chagrin of others.

Lean was developed by the MIT group under Dr. James Womack from a study of automotive companies and more specifically the Toyota Production System. Its approach is based on continuous improvement with a direct correlation to PDCA and Dr. Deming’s philosophies. Lean made its first inroads in many companies and gains in popularities (IMHO) because of the ease of entry into the methodology. Removing waste and improving flow was Lean’s mantra in the 90’s and the tools of 5s and Value Stream Mapping soared in popularity. However, as Lean continued developing tools of A3, Hoshin and Standard Work became common place. But even more so, the culture of PDCA and the spirit of Kaizen started to take hold.

Six Sigma was the methodology of choice for many manufacturers as a result of the significant strides that GE and Motorola had made. Later, Lean seemed to gain and Six Sigma wane in popularity. Lean became the path to a customer as an enabler of some quick wins. You could then take the deep dive with Six Sigma when you wanted to get “serious”. As Lean continued to steamroll and Six Sigma still continued with somewhat lackluster performance many organizations and consultants dropped the attachment to Six Sigma and became “Lean”. Popularity does create a crowd. This may not be an entirely accurate description but it serves as a basis for my views and the following comments.

What makes Lean Six Sigma work? When you first start using any methodology, you are typically introduced through the tools. Using Lean initially versus Six Sigma makes perfect sense, it is an easier introduction. And why reduce variability on non-value activities? But sooner or later you get to the fork in the road. One path says Six Sigma and the other path is this thing they call culture (Lean). So do you want to take the deep dive with a breakthrough structured approach (still has a steep incline) or do you want to try and instill a culture of empowerment. There is not a right or wrong answer. You can take either. Where I disagree, is that you can take both.

Six Sigma has always been about structure and tools. It is very, very good and does an outstanding job when applied properly. In Six Sigma thinking, you can use Lean tools initially and get to 95%. To finish the job, you use Six Sigma. And as a result, Lean Six Sigma was developed. If your organization grew out of the Motorola and G.E. world it seems like a perfect fit.

If you adopt the Lean mentality and the spirit of Kaizen (continuous improvement is not an event) you become immersed in the culture of Lean, as Dr. Balle wonderfully described in the Zen Story about the mountain. Summed up in the blog post: Lean Tools and Culture as it Relates to Zen

Have you ever played yourself in a game? On a basketball court or even a simple game of checkers, sooner or later you have to pick a side to win. It is inevitable. This is the ultimate wedge between the two methodologies and can simply be stated. Six Sigma is a structured methodology and Lean is a cultural driven by a learn by doing approach. That is not to say that Six Sigma does not have its prototyping options and that Lean is not without statistical control (it did evolve from Deming). But it is saying that both are two completely different paths that you must choose between.

If you take the path of and see Lean as Lean, Six Sigma does not make sense and is not a compatible technology. There is a significant culture difference and approach. If you take the path of Six Sigma, you view Lean as only a set of tools nothing more and why not, Lean has a great toolbox. If you take the path of Lean you still can be just as efficient and just as effective as Six Sigma, you just do it differently.

I make no qualms about stating that I believe and follow a Lean philosophy. Lean works in my world much better. PDCA which is basically form a hypothesis, test it and adjust is what sales and marketing is all about.

I support the ideas of Lean and Six Sigma without hesitation. What I have trouble understanding is how you can be philosophically aligned in Lean thinking and practice Six Sigma. So I believe you must ask yourself; Which fork in the road do you take?