Lean Six Sigma is a business improvement methodology which combines (as the name implies) tools from both Lean Enterprise (Manufacturing) and Six Sigma. Lean eliminates the waste in your processes, while Six Sigma ensures quality through the elimination of variation in your processes and also provides a structured data driven structure to solve problems and implement sustainable change into your business. We believe there before that the best approach for any business is to use Lean Six Sigma rather than one or the other. The benefits from taking this approach are proven to out way taking only one approach at a time. To understand Lean Six Sigma let us first explain the two methodologies.
Six Sigma is a set of practices originally developed by Motorola to systematically improve processes by eliminating defects. A defect is defined as nonconformity of a product or service to its specifications. In other words every time you do an activity you get exactly the same outcome (result), the same quality. For example if I fill in a form or take an order or resolve a customer issue or make a part no matter who does it the output is the same.
Top companies all over the world including Motorola have made Six Sigma a way of life for their business. This however requires commitment to the approach from top management down. If this is achievable then implementation and acceptance is easier and leads to massive savings. Motorola has made $ 17b savings up to 2006 using the approach. It ensures that everyone focuses on reducing variation in every aspect of the business from filling in forms to making a part. All activities in a business of any kind can be measured, analyzed, improved and controlled and so using some simple tools can give a reduction in variation leading to improved quality and costs.
Why do we want a reduction in the variation we obtain from any activity in our business? When we have the same output from a process or activity we know what we are going to get which makes the next step in the process easier and quicker to complete.
It reduces the amount of time wasted completing a task and it means that the quality of a part or process step is higher reducing the need to rework or redo the activity. The simplest analogy is to think of golf and putting into the hole. If every time you took a putt you got the ball into the hole think how good that process would be, now think how good your putting is. In business if every time a part was made it was identical in every way way to how it was meant to be – shape, form, look, feel etc that would mean we would have no quality issues. If we were completing a form and every time every field was correct, easy to read, all data correct, all numbers correct and it was the right form think how quickly things would be done. Well that is what Six Sigma is all about reducing the variation in everything you do.
The term "Six Sigma" refers to the ability of activities or processes to produce output within specification. In particular, processes that operate with six sigma quality produce at defect levels below 3.4 defects per (one) million opportunities (DMO). Six Sigma's implicit goal is to improve all processes to that level of quality or better. That would mean that every time you did something one million times you would only make a mistake 3.4 times.
To achieve these improvements in variation and therefore quality improvements and cost reduction Six Sigma uses an approach to solve problems (sources of variation) which is a standard methodology which everyone must use when solving problems regardless of size. DMAIC which was inspired by Deming's Plan-Do-Check-Act cycle is a sequence which if followed will ensure that not only will the root causes be identified but the best solution will be found then implemented into the organization permanently rather than for a short period before it goes back to how it was. If you are designing a new process or product then the method used would be DMADV.
Basic methodology consists of the following five steps:
"Define the process improvement goal or problem to be resolved this should be consistent with customer requirements and the business strategy.
"Measure the current process and collect relevant data for future comparison.
"Analyze to verify relationship between factors and to identify the real root causes ensuring that all factors have been reviewed.
"Improve or optimize the process based upon various analysis tools to identify a number of solutions and then using data determine the most optimal for the problem.
"Control to ensure that the solutions is implemented into the organization and embedded so that it does not return.
Basic methodology consists of the following five steps:
"Define the goals of the design activity that are consistent with customer requirements and business strategy.
"Measure and identify CTQs (critical to qualities), product capacities, production process capability, and risk assessments.
"Analyze to develop and design alternatives, create high-level design and evaluate design capability to select the best design.
"Design details, optimize the design, and plan for design verification.
"Verify the design, set up pilot runs, implement production process and handover to process owners.
Many people get confused by Six Sigma and believe that it is simply a case of applying a number of tools. This has lead to many failed implants of the methodologies. Other people are put off Six Sigma by the amount of data collection and analysis which is used. Simply put Six Sigma is all about data, if you have not got data you are just another person with an opinion. One of the reasons Six Sigma has been so successful in companies such as Motorola is that it is all data driven the methodology makes you use the data, analyze the data and then come up with solutions. To do this you must use statistics and tools which use stats to investigate and solve problems. As such typical tools used in Six Sigma include:
They can seam daunting and put off many people but the simple truth is that you do not have to know them all. You do not even need to use them all. It is good ideas to have one or two people in your organization who have detailed knowledge of them all you have to do is to know when they should be used then call in the experts.
When used properly Six Sigma can dramatically reduce variation in your processes and lead to massive savings. However when coupled with Lean it becomes even more powerful.