- Lean Six Sigma methodology to address waste and inefficiency
- Corporate Culture influence the effectiveness of Lean Six Sigma
- HR Management is at the center for successful Lean Six Sigma implementation
- DMADV – Define, Measure, Analyze, Design, and Verify-The methodology is used when a company aims to launch a new product or service in the market.
The Waste/Inefficiency Problem
Imagine yourself to be the manager of a supermarket chain. Once you’ve been elected in the position, the first issue that presents itself in the supermarket is the problem of managing different kinds of waste that may occur at any particular step from which the user does not gain any value. . The next problem is the conundrum of the rusted supply chain, causing delays in timely delivery of, let’s say milk, leading to customer dissatisfaction. These two problems, which are commonly faced by every manufacturer and supplier can be addressed with the incorporation of two concepts, ‘Lean’ and ‘Six Sigma’.
Lean – Addressing the Waste Problem
Lean is the methodology that aims to provide value to the customer by eliminating waste, focusing on continuous improvement, and reducing cycle time. Before understanding the influence of the lean methodology on waste management let’s discuss what is ‘waste’.
As stated above, waste can be defined as any step in the process that the user does not gain any value from. This waste can be divided into seven categories – Transportation waste, refers to the excess movement of people tools, inventory, equipment, etc., leading to waste of time and effort; Inventory refers to having more products and materials than required which may cause damage and defects, leading to increased cycle time and inefficient allocation of capital and so on; Waiting, refers to time wasted on amassing information, instruction, materials or equipment; Overproduction, refers to the production of more products than required; Over-processing, refers to unnecessary steps or work done in a process or service than required; Defects, refers to waste of product or service that fails to live up to the customer expectations; Skills, refers to the waste of human potential by underutilizing capabilities and delegating tasks to people with subpar training.
Over the years, a system has been developed to use the lean methodology to identify and address the different wastes. Three of the most popular and effective systems are JIT (Just In Time), 5S, and Kanban. The JIT aims to reduce the amount of time taken by a production system to provide an output and the response time from suppliers to customers; 5S focuses on cleanliness and organization while improving profits and efficiency; The Kanban system is a visual method to manage tasks and workflows. These processes coupled with the methodology of lean are used by corporates to optimize waste production and maximize results.
Six Sigma – Addressing production and supply chain inefficiencies
Six Sigma refers to a set of tools and techniques used for process improvements and removing defects. Six Sigma can be divided into two methodologies – DMAIC and DMADV. DMAIC – Define, Measure, Analyze, Improve and Control. The first step in this methodology is to determine the issues, opportunities to improve, and the customer requirements. In the ‘Measure’ phase, the performance of the process is measured without any alteration to set a benchmark. After defining and measuring the process, the next step is to analyze the defects, if any, and address the cause accordingly by making changes and ‘improving’ the process. Lastly, in the control phase, regular adjustments need to be made in the process to sustain the improvement.
DMADV – Define, Measure, Analyze, Design, and Verify. This methodology is used when a company aims to launch a new product or service in the market. In this process, the company first defines the customer requirements, then measures those requirements and makes specifications in the product. After determining the specifications, in the analysis phase, the company adjusts and tries to improve upon the idea to deliver a better product or service. In the design phase, the final product or service is created, based upon the gathered data and analysis. Lastly, in the verification stage, the final product is given for review, and the feedback is recorded to be incorporated and worked upon in future ventures.
The Six Sigma methodology is widely popular among various industries like petrochemical, healthcare, banking, government, and software. However, the Lean and Six Sigma methodologies are philosophical in nature and like any philosophy, are influenced by the culture in which it is nurtured. Corporate leaders constantly need to adapt and adopt corporate strategies and goals to line themselves up with the requirements of the culture in which they work.
Recommendations for adopting Lean Six Sigma
The dynamics between Lean Six Sigma, Corporate Culture, National Culture, Leadership Style, and Corporate Success are complex. However, there are strategies that need to be adopted by the corporates to make use of lean six sigma effectively.
Strategic HR management priority of every Lean Six Sigma implementation. Leadership is the main shaper of Corporate Culture, and together with Corporate Culture exerts the strongest influence on Lean Six Sigma implementation and Corporate Success. If Leadership Style does not line up to the Corporate Culture or is headed towards conflicting directions, the potentially positive effect on Lean Six Sigma and Corporate Success is lost.
Measuring Corporate Culture and Leadership Style needs to be a priority (before Lean Six Sigma is implemented) in order to identify key issues and challenges that could hinder its implementation.
Corporate Culture must embrace the values of diversity. The full benefit of Lean Six Sigma can be achieved by diversity in both Leadership Style and Corporate Culture. As soon as a company permits and supports multiplicity in the organization, it unfolds and maximizes the benefit through the quality management concept Lean Six Sigma as a focused and structured approach.
Managers should focus on developing and supporting an authentic and realistic company’s core instead of changing and adapting the scientific and data-driven process of Lean Six Sigma.
Expectations of corporate success need to be managed in line with corporate culture. Determining which goals are realistic in which timeframe is vital to gain credibility in the organization. Lean Six Sigma works with different situations of National Culture, Corporate Culture, and Leadership Style. But it does not work when changes are made without paying attention to the cultural fabric of the company. Transformational leaders who think and act at a different pace than a hierarchical culture would favor cause conflict between the expectations of employees and the leadership principles. Clear consciousness is necessary to choose the right speed. Setting realistic targets will pay off as employees are not attacked by unusual values and behaviors, and it is more pleasant to participate in the change when in line with their corporate culture.
Every corporate situation is unique and a key task for managers who are responsible to achieve clear consciousness of the current circumstances for their company. As the two factors, Corporate Culture and Leadership Style have a tremendous effect in any situation, choosing the right combination of these two concepts determines the success of any Lean Six Sigma implementation.
The functionalist perspective that leadership is the main shaper of corporate culture, demands strong HR management at the center for successful Lean Six Sigma implementation. Ignoring the influence of weaknesses in Leadership Style and not considering the role of HR management could lead to development towards decreasing individual and corporate performance.
