What are Lean & Six Sigma?
Lean & Six Sigma are established organizational improvement methods. Lean focuses on workflow acceleration and efficiency in delivering products and services. Six Sigma focuses on quality and consistency. These methods complement one another. Both improve your business processes and increase profitability when done correctly.
What is a business process?
A business process is a step by step means of delivering value to internal or external customers. They are an expression of your business strategy. The Lean term for a business process is a value stream, which emphasizes the flow of value. A well-designed value stream is an advantage your competitors cannot easily duplicate.
There are several types of business processes. Core processes directly produce revenue for the organization. If you manage a support process, your goal should be to better support & enable your organization's core business processes. And management processes sustain both core and support processes. Below are some examples of core and support processes from inputs to outputs, start to finish:
Product/Service Development: Identified customer need--->New or improved product or service.
Sales & Marketing: Brand/Product/Service awareness--->New customers and placed orders.
Procurement: Input requirements (materials, people, equipment)--->Ready for production.
Production: Raw materials--->Finished goods.
Service: Service resources ready--->Satisfying customer experiences.
Installation (Products): Finished goods---> Products ready for use by customer.
Customer Receivables: Pricing & terms---> Collected sales revenue.
Financial: Current/Projected revenue & expenses--->Budgets, investments, financing, liquidity, etc.
Regulatory: Business activities--->Consumer, environmental, tax, safety, labor, & privacy compliance.
Continuous Improvement, Quality: Current business performance--->Improved business performance.
Information Technology: Stakeholder data--->Stakeholder information.
Human Resources: Labor requirements--->Productive associates and more.
Plant/Office & Equipment Management: New equipment--->Maintained or disposed equipment.
What you can expect from us is a significant, measurable improvement to any core or support business process in your organization.
What will Lean & Six Sigma do for your business processes?
A business will not achieve its goals if its processes are flawed or disconnected. Each business process will have unique aspects based on what you want it to accomplish. But there are also characteristics you want every business process in your organization to have:
Stability is being able to deliver on your promises to customers consistently. Consistency requires you to seek out and reduce product and service defects, variation, and unplanned downtime. The identifiable causes of defects are minimized or extinguished one after another. Stability enables the other essential process characteristics described below.
Imagine your customer with their checkbook out, watching how their product is made or their service performed. What activities would they be willing to pay for, and which would they not? We eliminate or minimize the non-value-added (NVA) activities that don't serve the business OR the customer. The removal of NVA activities from your business processes frees up labor and resources that can be applied to more productive purposes. Lean also calls these "wastes". There are potential wastes in inventory, transportation, waiting, overprocessing, defects, poor design, overproduction, lost customer opportunities, and employee potential.
When Stability and Efficiency have been addressed, we turn our attention to the value-added (VA) activities in the Value Stream.
Flow is the manner in which valued-added work moves through the system. Good flow means the uninterrupted transformation of inputs to valued outputs. When work stops and starts, that work-in-process must be stored and tracked. Customers are forced to wait. Inventory can also become dated or obsolete. When we can produce things quickly, with no inventory or employees sitting around, smaller batches are possible, further reducing costs. When you decrease the lead-time from order to delivery of products or services, less guesswork about future demand is needed, and the waste of overproduction is avoided.
Flow also applies to knowledge work. While knowledge work is not as easy to see as a product being assembled, it too has its tasks and stages of completion that should move through the value stream with as little delay as possible. Information also ages quickly and should be used while it can still provide value.
Finally, we design responsiveness and flexibility into our business processes so we can changeover to another product in our product mix, ramp up or scale back production in response to customer demand, and respond to supply chain issues, threats from competitors, new opportunities from identified customer needs, or changing regulations.