KMS is publishing a series of blogs on Lean and Six Sigma over the coming weeks. Today’s publication, "What Are Lean & Six Sigma Methodologies?" is the first of three installments. Future installments will cover "Lean Principles and Tools" and "Six Sigma Principles and Tools."
The manufacturing world, across industry sectors, has witnessed significant improvements in productivity and competitiveness over the past couple of decades as a result of Continuous Improvement (CI) methodologies. Two of these methodologies that are recognized as having broad applicability are Lean Manufacturing and Six Sigma. In fact, some practitioners have combined these CI philosophies and tool sets into Lean/Six Sigma. Many smaller and medium-sized manufacturers (SMMs) have learned that making the organizational commitment to master the concepts of Lean and Six Sigma methodologies can transform their business, leading to improvements in safety, quality delivery and cost.
By mastering Lean and Six Sigma Methodology, SMMs can create a more efficient and sustainable business and drastically improve their top and bottom lines.
What Is Lean or Lean Manufacturing?
Lean is a continuous improvement methodology that focuses on the elimination of any steps within a business or work process that does not contribute to "value" as defined by the customer. It is a systematic process for improving flow within a system by eliminating non- value-added activities which are hindering the flow of value to the end customer. Utilizing Lean methodologies, the business organization and manufacturing processes are optimized so as to generate the value that the customer requires the least amount of waste. All waste is essentially unnecessary cost, so its elimination results in increased efficiency, productivity and profitability.
Lean Manufacturing is understood in three distinct areas:
- An overall business strategy
- A philosophy for continuous improvement
- A continuous improvement toolkit
Lean is a way of thinking about an organization in terms of how products and services are produced and delivered and how to continuously improve the work processes - from product concept and design through manufacturing, sales, fulfillment and back-office functions. Lean delivers the most benefit when its principles, philosophy and tools are employed outside the "four walls" of a given company and extended across a value chain of both upstream and downstream suppliers.
Lean is guided by a set of five principles and three perspectives.
Principles of Lean Thinking:
- Identify what is of value to the customer
- Understand the flow of that value through the organization
- Improve the flow of value through the organization
- Let the customer pull that value through the organization as needed
- Seek perfection
The three perspectives that are at the core of the principles of Lean Thinking are:
- See from the perspective of the customer
- See from the perspective of the part, product, or service.
- See from the value stream perspective (end to end).
What Is Six Sigma (6Ϭ)?
Six Sigma is a set of tools and techniques used to improve processes by reducing the variation in their output in order to reduce errors.
The fundamental objective of the Six Sigma methodology is the implementation of a measurement-based strategy that focuses on process improvement and variation reduction through the application of Six Sigma improvement projects. Six Sigma can be described as a methodology that uses statistical tools to identify and eliminate defects in any process. The goal of Six Sigma is to improve the quality of your output. By tracking and analysis of data, and statistical modeling, changes to an existing process are identified that will result in improved output. This improvement can come in the form of reduced defects, increased throughput, and more efficient processes—all of which reduce the cost of the product or service being provided.
Six Sigma looks at the variations that are taking place in the process and in the variation in the output of the process. The goal of Six Sigma is to reduce the variation (waste), since in reducing the variation, the more quality good product is produced utilizing the same or fewer resources.
Six Sigma is usually understood by three distinct elements:
- A Strategy of Continuous Improvement.
- A set of Statistical Tools that are applicable to addressing variation in any process related to producing a product or providing a service.
- A method to define the Degree of Quality a process can achieve.
The statistical representation of Six Sigma describes quantitatively how a process is performing. To achieve a Six Sigma conformance, a process must not produce more than 3.4 defects per million opportunities. A Six Sigma defect is defined as anything outside of customer specifications. A Six Sigma opportunity is then the total quantity of chances for a defect.
Lean and Six Sigma look at issues leading to reduced business performance from different perspectives. Lean can be thought of in the macro sense -- it focuses on making waste in the business and manufacturing processes visible. Six Sigma can be thought of in the micro sense -- it focuses on waste that is embedded in processes and equipment and cannot be made visible without the use of statistical tools. In both cases, once waste is identified, resources can be dedicated to remove it. As such, Lean and Six Sigma work well together for many SMMs needs. Lean improvement methods are less expensive to implement than the statistical based Six Sigma methods. As such, many firms can make major improvements for years using only Lean before having to invest in the training and tools used in Six Sigma.
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Gregg Profozich is a manufacturing, operations and technology executive at Kansas Manufacturing Solutions' peer MEP Center in California, CMTC. Gregg believes that manufacturing is the key creator of wealth in the economy and that a strong manufacturing sector is critical to our nation’s prosperity and security now, and for future generations. Across his 20-year plus career in manufacturing, operations and technology consulting, Mr. Profozich helped manufacturing companies from the Fortune 500 to the small, independents significantly improve their productivity and competitiveness.