The 5 Lean Six Sigma Principles

Lean Six Sigma Principles: Six Sigma is a process of continuous improvement that reduces procedure waste and defects and gives a framework for a general organizational culture shift.

By introducing Lean Six Sigma principles to your organization, workers and supervisors’ mindset change to one that targets expansion and constant improvement through process optimization. This shift in the mindset of a firm optimizes efficiency and increases endurance.

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Lean Six Sigma is a philosophy and methodology for process and systems improvement. It was developed by Motorola to help find defects quickly and fix them fast, with the ultimate goal of improving quality, cost, and productivity.

Lean Six Sigma emphasizes an organizational culture that encourages data-driven decision-making; faster identification of problems; and thorough problem solving before a new product or service is introduced in a customer-centric manner.

Lean Six Sigma can be implemented by any company at any stage through the use of tools, training, and education on lean process improvement and management.

The lean six sigma concept is one of the approaches to improve productivity, quality and manage costs in a company.

Lean Six Sigma History

Motorola Lean Six Sigma

Lean Six Sigma or LSS is an approach for removing waste found in manufacturing. The approach was developed by American management consulting firm Motorola in the year 1995 and subsequently modified to help reduce cost and improve any organization’s efficiency and productivity.

This approach is commonly used as part of the continual improvement (CI) program. The lean six sigma approach is being used as a basis for Lean Management, a modern management philosophy.

In the early 1980s, the business consulting firm of Oliver Wyman had started gaining interest in lean manufacturing. It provided a continual improvement model to its clients that combined elements of lean product development and project management. Oliver Wyman’s senior partners decided to expand these concepts into a broader approach that could be used across different industries and companies.

They formed a partnership with industrial engineering consultants Ingersoll Rand. The result was the Lean Manufacturing Initiative, which combined lean manufacturing practices with other best practices to improve manufacturing efficiency and productivity.

The LMI was first published in 1986, called Six Sigma: Achieving World-Class Quality. It introduced the basic concepts of lean manufacturing systems, including the idea that value can be increased through waste elimination. The book became more popular after appearing on “The New York Times” best-seller list in 1989 and 1990.

It was popularized by Michael Hammer and James Champy, who called it the “management revolution” of the 1990s.

By the early 1990s, Motorola adopted lean manufacturing and Six Sigma as part of its quality initiative. The company’s CEO Robert Galvin tasked University of Michigan professor Jack Welch with developing a way to make his company more competitive in a changing global market.

 In 1993, along with other Motorola engineers, Welch began experimenting with methods to improve quality and decrease costs across the company.

Welch, who was widely known for his work on the “Total Quality Management” (TQM) movement of the mid-1980s, initially sought to unite concepts such as quality control and lean manufacturing.

The first step in this process was to split up Welch’s “quality” and “productivity” departments. Welch had been a proponent of TQM, and Motorola’s research revealed that the company couldn’t focus on both improvements at the same time.

The result was a new department, Quality, and Productivity, which would focus on integrating the concepts of quality and efficiency. Welch hired Bill Smith, the former head of TQM at Xerox‘s Palo Alto Research Center, to head this new department.

Smith brought James O’Toole, a former Xerox executive from Ireland who had been instrumental in developing TQM at Xerox, to run the Quality and Productivity division. The two began implementing Six Sigma across Motorola’s businesses.

In the same year, Motorola adopted more rigorous methods of measurement in its Six Sigma efforts. The company drilled down into existing products to identify where quality could be improved. These improvements were made through testing, document analysis, and statistical process control.

By 1995, Motorola successfully increased its quality level while reducing costs and improving efficiency levels. The company also met several of the goals in Welch’s “Quality Is Free” implementation plan.

In 1996, Motorola decided to formalize its lean and Six Sigma initiatives. Motorola’s management came to believe that these efforts were central to the company’s success in an increasingly competitive marketplace. Motorola formed a venture capital subsidiary, MCV Capital, to support its efforts in developing tools and training programs for its Six Sigma program.

The following year, the divisions formed their own boards and became separate operating companies. The division was named Motorola Solutions. In 2000, this division split off from Motorola to become a separate company called Motorola Solutions Inc. (NYSE: MSI). Motorola Solutions still uses Motorola’s lean six sigma model.

While initially developed in the United States, lean six sigma is now used globally by many companies. It is considered to be one of the most popular and efficient methods to achieve organizational goals, including excellence in service delivery, high productivity rates, and low costs.

Lean Six Sigma Principles

Lean Six Sigma has five principles. Below are the 5 Lean Six Sigma  principles Business  that will bring Transformation to your organization:

1. Focus on the client

Among the oldest yet most prudent bits of business advice still hold true today. Regardless of what business you are in, you always need to put customers first. Everything should revolve around your clients and their needs. After all, without customers, where will your organization?

Before you begin making any extreme or even minor adjustments, establish the degree of quality or prerequisites you have promised your customers. Every choice you make need to bring your company closer to bringing maximum value.

2.  Use data to identify the variation in the process

Before you can improve your process, you have to know all the measures inside. Even if you previously record your workflows, it is important to analyze how you do matters to ascertain which steps add value and which do not (and may, consequently, be removed from the process).

As part of this cultural shift, your company should always search for new ways to streamline the procedure and remove waste. Keep your eye on the data, examine your bottom line, and adjust your procedures where necessary.

Know how the current process works; You have to observe your procedure’s current state before you can move forward and create improvements. Assessing your value stream is indisputably what makes Lean Six Sigma principles so powerful. It is how companies visualize each one of the measures in a given process and highlight regions of waste.

3. Continually improving the process to eliminate the variation

Before you’re able to make improvements and make flow on your process, you have to visualize and eliminate waste. That sounds like a very simple step; however, both Lean and Six Sigma instruct that inefficiencies can sometimes be hidden, which explains why it’s so important to first know what counts as waste and understand how to reduce variants.

To be proactive about eliminating waste, try these five measures from Rene T. Domingo, a Asian Institute of Management professor.

• Step 1: Make waste visible.
• Step 2: Be conscious of the waste.
• Step 3: Be accountable for waste.
• Step 4: Measure the waste.
• Step 5: Eliminate or reduce waste.

4. Involve people from different levels of management and process

As you can tell from the other principles we have mentioned, Lean Six Sigma takes a whole lot of change. You have to welcome change and encourage your employees to accept change as well. The root of this cultural shift should be information. It’s possible to dispel fears by describing the benefits of the change and showing employees the way you’ve made their work more impactful through data.

Six Sigma contributes to a highly scientific and rigorous method of examining, quantifying, and analyzing data, which is essentially the DMAIC procedure that we mentioned earlier. However, the point is not to just do that once and then discard it before a new problem arises. It should be an integral and intrinsic part of your daily, every job mindset.

5. Be flexible and thorough 

The company’s management system needs to acknowledge positive changes. Individuals should be motivated to accept the changes in the machine to get rid of the variation. To motivate the employee, the benefits of this six sigma system should be made clear to all workers’ levels. This will make the changes easily acceptable.

Six Sigma also requires reducing variation to be exhaustive. To understand all the aspects of a process–the steps, stakeholders, and methods involved. This will help to ensure that any updated or new procedure works.

Implementing Lean Six Sigma

The most critical aspect of implementing lean six sigma is to correct any problems before they become serious by introducing error-correction programs at all production levels. These are applied to all manufacturing stages, supply chain operations, shipping, and customer service (including complaint handling).

A full set of improvement tools comprises Fourteen Tools, the DMAIC framework, and Six Sigma metrics.

Lean six sigma is a suitable process for service organizations. It can be used to reduce variability in the customer experience by reducing the number of defective parts or incorrect responses to inquiries. Lean six sigma can also be used to prevent repetitive mistakes and errors in processes and procedures, thereby improving product quality and customer satisfaction.

Lean six sigma can be used to increase the productivity of key processes by reducing waste. This forms the backbone of the process, as it allows for major gains in operations efficiency when combined with other improvement methods.

Adopted suppliers must meet stringent quality and manufacturing standards for their components to satisfy customer requirements while also being cost-effective. This requires suppliers to have a continuous improvement culture that reduces variation in their processes and product quality.

DMAIC approach

Lean Six Sigma uses the DMAIC approach to define Six Sigma goals and ensure that Six Sigma methods are used to set and monitor performance targets. The DMAIC program structure is used as a systematic approach for continuous improvement of the organization’s processes.

 DMAIC was developed by Motorola during its Six Sigma tenure. The letters in DMAIC stand for Define, Measure, Analyze, Improve and Control.

Fishbone Diagram

Lean Six Sigma allows for the collection of data through a process called the fishbone diagram. A fishbone is constructed by putting main causes in the ribs and sub causes under the bones. It helps to analyze possible root causes of a problem.

A Tree-Like Diagram

A tree-like diagram is constructed by drawing a trunk, then dividing it into branches and sub-branches until they become small enough to be regarded as leaves. The fishbone type of diagram has a longer time span than the tree-like type.

 This is because each branch may have more contributing factors (sub causes). The tree-like diagram allows us to focus on the main causes of a problem while ignoring lesser contributory areas.

The idea is that small changes made in these areas will start gathering momentum and will eventually cause the main cause to change. The big picture is what the organization sees as their “big bad thing” or their “big pain.”

 Most big problems are not really a single issue but result from a number of small problems. It is how these small problems interact that causes the big problem. The idea is to find all of the small contributing factors or causes that together cause a problem and then change each one to make the problem go away.

Fishbone Diagram Example

For example, on a bank’s balance sheet, customer loans might appear as “bad debt,” one main cause of which might be “poor customer service.” Digging deeper, further causes to this might be:

• Poor product purchase advice

Poor loan approval procedures from the sales staff who are trained inadequately by the service people who are overworked and undertrained. The managers don’t fix this because the sales staff turnover rate is too high, and they are trying to keep the customer service representatives in a job.

• Poor communication between departments

Either communication are not good enough, or people don’t bother to pass information upstairs.

The team does not seem to have a lot of experience in dealing with difficult clients. The most annoying thing is the arrogance of the staff. They think they are better than colleagues and if you do not follow what they say, you are stupid or lazy or don’t want to do your job properly.