Which Method was First – or can I use Both?
We recently conducted a second Kaizen Event for a medical and dental service provider. During the project a team member asked “Is Kaizen the same as Lean, and is Six Sigma on its way out?” I remember leading my first Kaizen/Lean project 18 years ago and hearing “Is Kaizen replacing Total Quality Management?” Not much has changed over the quality improvement timeline. Many enterprises whether service or manufacturing are looking for simplified answers and methods to cost reduction, improved quality and enhanced customer satisfaction.
It is not about what’s been around the longest, or some new improvement method you heard about that “everyone is doing.” It is about what your organization is facing today, and what it could be facing tomorrow if you do nothing. Do you have customer dissatisfaction, product returns or service issues, high operating costs? Maybe trying to improve cycle time, service delivery or reduce process waste? These are the type of questions you need to ask to determine what to do, and how to focus your resources to improve profit.
Lean and Six Sigma have become the most widely known methods for creating breakthrough and sustained improvement. Keep in mind that these methods have evolved from previous proven methods such as the plan-do-check-act (PDCA) cycle and Toyota’s process waste elimination system.
Lean Improvement Through Waste Elimination
A lean core principal is based on creating a “pull system” to produce faster, rather than the traditional “push systems” used by most organizations. The goal is to always pull from the customer demand, not push to the customer and suboptimize your capabilities. A method that started in manufacturing to reduce waste is now used to improve cycle time, and workflow in workplace and department performance, and reduce waste in hospitals, insurance companies, financial services, and nonprofit environments.
Value stream mapping is an important tool used in lean. It documents all the tasks (material and information flow) and process metrics (process time, cycle time, inherent costs, barriers) within a system including waste and non-value added activities. An example of a task level metric used in our lean events is called Complete and Accurate (%C&A). This equates to the time the downstream customer can perform the task without having to “CAC” the incoming work:
- Correct information or material that was supplied
- Add information that should have been supplied
- Clarify information that should or could have been clear.
The output metric is measured by the immediate downstream customer and all subsequent downstream customers. This process makes visible the problems or waste so that they can be eliminated, thereby making the processes faster and cheaper to deliver. Creating “value” as seen by the eyes of the customer is the key component to lean. Providing value to the customer is why a supplier exists. Whatever does not provide value to the internal and external customer can be considered as process waste.
Six Sigma Improvement Through Voice Collection and Data Analysis
The fundamental objective of the Six Sigma methodology is the implementation of a measurement-based strategy that focuses on process improvement and variation reduction.
A Six Sigma system is based upon gaining customer, business, and organizational process knowledge “data” for utilizing information to drive performance improvement and measurement of core processes. Two primary methods known as “Voice Collection” and Define-Measure-Analyze-Improve-Control (DMAIC) are used to improve processes and products, and to help ensure that products and processes function well starting with the voice of the customer to the delivery of product and services.
Understanding what your customers consider “critical success factors” are absolutely necessary for determining the depth of your performance improvement system. This information further identifies a cause and effect relationship in regards to how your processes are performing, their capabilities, effective measurement, and the identification of necessary resources for your business to achieve performance excellence.
One of the most distinct differences in Six Sigma is the link to business finances. The DMAIC process is an improvement system for existing processes falling below specification and looking for incremental improvement.
Lean Six Sigma is quite simply the integration of lean and Six Sigma methodologies. Lean focuses on efficiency, and Six Sigma focuses on how effectiveness can lead to faster results than either method applied independently of the other. Any successful improvement deployment depends on a clear understanding of personnel roles, responsibilities, structures, and necessary training requirements for employees.
Successful companies recognize that comprehensive process improvement is not achieved by a simple “fix it” to one-time problems, or band-aid approaches. Improved profits require a new way of doing business, and the smart companies use continuous improvement as a daily business function.
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