The Performance Advantage

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APICS – The Performance Advantage

July/August 2004
Volume 14, Number 7

Lean Culture

Peaceful Coexistence?
Exploring the relationship between the heavyweight methodologies of “Six Sigma”and “Lean”

By Ron Crabtree, CPIM, CIRM

There is an ongoing debate in the business world regarding the difference between lean/world-class manufacturing (WCM) and six sigma, and whether they are mutually exclusive or actually compete with each other. The questions seem to revolve around three themes: “How do the six sigma and lean/WCM approaches differ?” “Which should I choose to apply?” And “Should lean/WCM approaches coexist with the application of six sigma?”

Basic understanding

Regular readers of Lean Culture should have a good understanding of what the lean/world-class approach is all about. Lean and world-class principles have evolved from principles pioneered by Henry Ford in the auto industry and later by Deming, Juran, and others who helped the Japanese rebuild after World War II. Toyota in particular is credited with making lean a well-known word in manufacturing as embodied in the Toyota Production System (TPS). The results of applying these techniques are legend though still poorly understood in many industry sectors both in the United States and abroad.

Six sigma has been defined in a variety of ways. Let’s look at a few of these definitions.

“Six Sigma provides companies with a series of interventions and statistical tools that lead to breakthrough improvements in profitability and quantum gains in quality, whether a company’s products are durable goods or services.”Juran Institute Web site.

“Six Sigma is about employee involvement. Many programs labeled Six Sigma include just a small portion of the company’s total workforce. This results in getting very limited benefit, while most of your resources, and the intelligence they possess, remain unused.” Six Sigma Demystified, by Alan Larson.

“Six Sigma is about improving profitability, although improved quality and efficiency are immediate by-products of Six Sigma . Six Sigma focuses on achieving financial targets in twelve-month increments . The Six Sigma Breakthrough Strategy broadens the definition of quality to include economic value and practical utility to both the company and the consumer. We say quality is a state in which value entitlement is realized for the customer and provider in every aspect of the business relationship . Six Sigma is . a business strategy and philosophy built around the concept that companies can gain a competitive edge by reducing defects in their industrial and commercial processes. Classically speaking, a defect is anything that fails to meet the customer’s expectations or requirements. Within the framework of Six Sigma, a defect is anything that blocks or inhibits a process or service.”Six Sigma, by Mikel Harry and Richard Schroeder.

It is no surprise that the six sigma gurus and authors end up with different versions of the same thing. The same thing happens in the world of lean. Nearly 20 years ago, I was the beneficiary of two weeks of Taguchi Design of Experiments (DOE) training and participated in a series of designed experiments to improve our processes at an automotive interior trim manufacturer in Michigan. After reading a number of books on six sigma, working with six sigma Black Belts, and reviewing case studies over the years, I have come to the conclusion that six sigma is an expansion on the approach pioneered by Taguchi and others (Deming and Juran included) and an “Americanizing” of the concepts.

Similarities and Differences

Though it is outside the scope of our purposes here to fully detail all the similarities and differences, let’s take a look at a short list of the key points of both approaches and see how they compare. For each point, there is a short explanation of how each of the two camps views the issue.

Focus on customer satisfaction. While both six sigma and lean/WCM do focus heavily on satisfying customers, six sigma makes customers the primary driver for action. The premise is that without high levels of customer perceived “utility” and “value” just reducing waste (a lean focus) is not enough.

Endless war on waste-enterprise-wide. One of the appealing aspects of a lean/WCM approach is focusing everyone on continuous elimination of wastes-indoctrinating “kaizen circles” as part of the culture. Six sigma tends to focus only on those opportunities that are customer focused and that promise a large (and immediate) financial reward.

Tools focused on common-sense improvements. Workplace organization and cleanliness (5S), Total productive maintenance (TPM), Kanban/pull systems, kaizen, setup reduction, teamwork, error proofing and problem solving, cellular manufacturing, and one-piece flow are the cornerstones of a lean continuous improvement strategy. Lean/WCM tends to be more grassroots and centered on empowerment of people to create stability, repeatability, and a culture of continuous improvement powered by natural and cross-functional teams.

On the other hand, one of the selling points that some six sigma gurus tout is that six sigma zeroes in better on “big bang” improvements. Black Belts are expected to target and drive six-figure, if not seven-figure, bottom-line savings projects every year.

DMAIC methodology. While most lean/WCM practices strongly suggest PDCA – plan-do-check-act Deming wheel cycle of continuous improvement – six sigma drives a very rigorous and well-defined five-point process for working on improvement projects in the DMAIC (define, measure, analyze, improve, control) methodology.

5S and standardized visual work as a foundation for all processes. Six sigma does not seem to have an overriding, common foundation implementation effort suggested. Lean/WCM teaches 5S – a five-point process for sort, straighten, sweep, schedule, and sustain and standard visual work is the one best method for work that builds safety, productivity, and quality into processes. Both are considered part of a critical foundation in world-class enterprises. In 5 Pillars of the Visual Work Place, Hiroyuki Hirano states, “World class facilities develop beginning with the 5S”, and facilities that fail, fall apart beginning with the 5S.

Problem identification and problem solving techniques. These include brainstorming, fishbone/Ishakawa/ cause-and-effect diagrams, five why, Hoshin problem solving, Pareto analysis, 8-D/7-step, failure mode effect analysis (FMEA), and others. Both six sigma and lean/WCM methodologies have a heavy emphasis on careful evaluation and definition of problems, and both promote a rigorous, systematic process to find the true root cause(s) of the problem. Six sigma is more data based and lean/WCM tends to be more subjective – with a bias for immediate action versus a long period of data collection before action starts (six sigma). Common elements include a Pareto analysis of data and verification processes to ensure countermeasures are fully effective in the long term.

Value stream mapping. Also known as “information and material flow maps” value stream mapping is credited to Toyota in its best-known form.

I have examined or practiced more than 20 methods for value stream mapping, and I believe the permutations are nearly unlimited. Value stream mapping is a scalable approach to create a visual representation of what is happening in a process and helps to identify where changes are needed to improve system performance.

On the other hand, process mapping is a tool favored by the six sigma community. Process mapping is used to identify the inputs and factors that can have an effect on the problem being pursued. Think “elegant” more like what you would expect to see in a software process flow map. I have found process mapping effective for complex interrelated processes. For most people and business problems, I have found a variation on value stream mapping far more effective than process mapping because it is much easier to understand and has more visual features.Team-based bias. Everyone must be involved to achieve excellence. This is an all-or-nothing deal for stakeholder involvement. Lean/WCM approaches ultimately mandate full involvement of all stakeholders.  Six sigma approaches suggest that full involvement is not possible or will take too long, and that fully engaging your best people to drive changes will get you where you want to go much faster.

Answering that question

“Should six sigma and lean/WCM coexist in my company?” I hope the answer to this question is self evident: Yes. Many of my six sigma Black Belt friends strongly contend that lean/WCM approaches should precede and coexist with the application of six sigma methods. Why? Put simply, lean/WCM provides stability and repeatability in basic processes. Once stability has taken hold, all the “noise” of variation due to human and easily controlled process variations goes away.  The data and indicators collected to support six sigma activities thereby become much more reliable and accurate. This leads triennial process.

Summary Learning Objectives:

  • Brief overview of differences between applying IT-based Enterprise Management systems and Flow/Lean/Synchronous concepts
  • Discussion of the “Loss of Corporate Consciousness” Phenomena
  • Desired attributes of Lean IT Enablers to support Flow/Lean companies
  • “Deep-dive” into certain key elements of Lean where IT Lean Enablers can play a vital role
  • A Group Exercise Continuum – “Rate Your Lean IT Support Needs in Complex Manufacturing and Job Shops”
  • Interactive Simulation:  “Complex Manufacturing & Job Shops – applying “lean” and “IT” tools synergistically”
  • Building your own assessment study of IT tools to drive lean results
  • Building the business case for using IT tools in the Lean environment
  • IT Solution Selection Suggestions and Resources
  • Q&A Forum

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