Lean and Six Sigma are buzz-words we hear in business all of the time. Before we get started, let’s make sure we all understand just what we mean by “lean” and “Six Sigma”.
About Six Sigma
Six Sigma is a structured, data-driven process of solving critical issues from a business perspective that we haven’t been able to solve with current methodology.
Six Sigma is the single most effective problem-solving methodology for improving business and organizational performance.
The common measurement scale is called the Sigma capability or Z and is a universal scale. It is a scale like a yardstick measuring inches or a thermometer measuring temperature.
The scale allows us to compare business processes in terms of the capability to stay within the quality limits established for that process.
The Sigma scale measures Defects per Million Opportunities (DPMO). Six Sigma equates to 3.4 defects per million opportunities.
What Six Sigma is and is not:
- Six Sigma is not an add-on to normal business activities.
- It is an integrated part of the improvement process.
- Six Sigma is management methodology driven by data.
- Six Sigma focuses on projects that will produce measurable business results.
- Six Sigma is not a standard, a certification or a metric like percentage.
- The central idea behind Six Sigma is that if you can measure how many” defects” you have in a process, you can systematically determine how to eliminate those and approach “zero defects”.
- Sigma is a value from 1 to 6 that signifies the maximum number of defects per million:
- Sigma = 690,000 defects/million = 31% accurate
- Sigma = 308,537 defects/million = 69.1463% accurate
- Sigma = 66,807 defects/million = 93.3193% accurate
- Sigma = 6,210 defects/million = 99.3790% accurate
- Sigma = 233 defects/million = 99.9767% accurate
- Sigma = 3.4 defects/million = 99.999997% accurate
- Six Sigma is about reducing variation.
- Six Sigma find out the facts before acting.
“Lean” means continuously improving towards the ideal and achieving the shortest possible cycle time through the tireless reduction of waste.
- It is focused on eliminating waste in all processes
- It is about expanding capacity by reducing costs and shortening cycle times
- It is about understanding what is important to the customer
- It is not about eliminating people
Examples of Lean Projects:
- Reduced inventory
- Reduced floor space
- Quicker response times and shorter lead times
- Decreased defects, rework, scrap
- Increased overall productivity
History Behind Lean
The phrase “lean manufacturing” was coined in the 1980’s and has its roots in the Toyota Production System. (See later in this module)
Most of the basic goals of lean manufacturing are common sense, and some fundamental thoughts have been traced back to the writings of Benjamin Franklin.
Henry Ford cited Franklin as a major influence on his lean business practices, which included Just-in-time manufacturing. The founders of Toyota designed a process with inspiration from Henry Ford and their visits to the United States to observe the assembly line and mass production that had made Ford rich. The process is called the Toyota Production System and is the fundamental principle of lean manufacturing.
Two books have since shaped the ideologies of Lean: “The machine that changed the world” (1990) and “Lean Thinking” (1996).
Toyota Production Systems
The Toyota Production System (TPS) is a mindset and management system that embraces continuous improvement. TPS organizes manufacturing and logistics, including interaction with suppliers and customers. Originally called “Just in Time Production,” it builds on the approach created by the founders of Toyota. TPS revolves around 5 simple steps:
- Define Value of your product > Make it according to Customer needs and Customer Defined
- Identify Value Stream of your product > Follow the product and identify unnecessary actions
- Study the Flow your product > Eliminate All Waste
- Make only what the customer orders > Produce Just In Time for Demand
- Strive for Perfection > Continuous Improvement. Good enough is never enough.
The Toyota Precepts
The five methods defined by Toyota contain some basic principles:
CHALLENGE: Form a long-term vision, meeting challenge with courage and creativity to realize your dreams.
- Create Value through Manufacturing and Delivery of Products and Services
- Nurture a spirit of Challenge
- Always have a Long-Range Perspective
- Thorough Consideration in Decision Making
KAIZEN: Improve your business operations continuously, always driving for innovation and evolution.
- Have a Kaizen Mind and Innovative Thinking (See in later module)
- Build Lean Systems and Structure
- Promote Organizational Thinking
GENCHI GENBUTSU (Go and see): Go to the source to find the facts to make correct decisions, build consensus, and achieve goals at our best speed.
- Genchi Genbutsu (Go and See)
- Lead with Consensus Building
- Create Commitment to Achievement
RESPECT: Respect others, make every effort to understand each other, take responsibility and do your best to build mutual trust.
- Respect for Stakeholders and community
- Develop Mutual Trust and Mutual Responsibility
- Be Sincere, transparent and open in all Communication
TEAMWORK: Stimulate personal and professional growth, share the opportunities of development, and maximize individual and team performance.
- Have Commitment to Education and Development
- Have Respect for the Individual; Realizing Consolidated Power as a Team
I’d love to hear from you!
How can YOU use process improvement to make a bigger difference in your company? Where can you tweak and optimize for greater efficiency?
Reply and let me know your thoughts!
I look forward to helping you in your Lean Six Sigma journey!
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