Getting beyond the hype is improtant whe it comes to implementing Lean and/or Six Sigma?
Which one first, Lean or Six Sigma?
The Lean vs. Six Sigma discussion continues to roll on. Which is the best system for a business to adopt? Which one will deliver the best results? Which one gives fast results? What are the implementation cost difference’s between a Lean and a Six Sigma program? These are typical questions that get asked in this long running comparison between Lean and Six Sigma.
There are three factors that will influence any management team to decide on Lean or Six Sigma:
- Complexity of the business processes.
- Dollar amount available in the training budget.
- Discipline of management team to execute improvement initiatives.
1. Complexity of the business processes:
Any business with a high level of complexity in its processes will require an improvement program that can meet the demands of the customer by using a more analytical approach. These types of businesses will use Lean to stabilize their processes and Six Sigma to reduce variation and improve quality. These types of organizations operate in a more academic or scientific level of industry such as chip manufacturers, software developers, etc.
Any business with a lower level of complexity needs an improvement program that can meet the demands of its customers by identifying and eliminating waste using basic Lean principles and problem solving tools. Kaoru Ishikawa stated, ” that 95% of all problems could be solved using seven basic quality tools.” These seven tools are:
- Flow Chart ( or Value Stream Map)
- Pareto Chart
- Scatter Diagram
- Cause & Effect Diagram
- Check Sheets
- Control Charts
Organizations that have successfully implemented Lean Principles use most, if not all of these seven quality tools as part of their Problem Solving toolkit. In conjunction with the “5 Why’s”, the Lean toolkit can become a very effective set of tools to help identify and eliminate waste.
2. Dollar amount available in the training budget.
Traditionally, companies will spend less than 3% of their revenue on training. The Lean vs. Six Sigma discussion raises a legitimate question: “How much does it cost to implement each system?” Well one thing I know for sure is that Lean is a much cheaper system to implement than Six Sigma. Why is this? Six Sigma requires specialist training to develop a core group of green and black belts to run projects. This training is much more complex and expensive than teaching your employees to understand Lean principles and how to apply them. So, why do companies adopt Six Sigmas if it is more expensive to implement than Lean?
It is easy to answer this question by using the comparison I used earlier in this article. “If a business can improve its process using seven basic quality tools and lean principles, why would they want to implement a Six Sigma program?” I think the answer is obvious, they would only do this if they had complex processes or were influenced by the hype that Six Sigma is the ultimate silver bullet to solve all of their problems and improve performance. Lean is easy and relatively much more cost effective to implement compared to the overall cost of a Six Sigma program.
3. Discipline of management team to execute improvement initiatives.
In the end it really does not matter how much a business pays for any system if the management team lacks the discipline to implement any of their improvement initiatives. During the 27 years I have been working in the Continuous Process Improvement field, it is amazing how many companies do not execute their own strategic or tactical initiatives. The best plan in the world is useless unless it is converted into action. The cost of training employees to understand Lean or Six Sigma in one thing. However, the cost of taking several employees away from their daily productive work to participate in an improvement team and their ideas are not used is the worst kind of waste.
To summarize the article, I would recommend that any company start their Continuous Process Improvement journey by first implementing Lean principles and the seven problem solving tools. Employee training can be done on-site or online. If you’re interested in signing up for a free access to Lean training, click here. When business processes have been stabilized through the application of Standardized Work using Lean princples, then and only then would I personally consider implementing a six sigma or a lean six sigma program.