One of the constant debates that go round in the business world is the choice of the best method that effectively streamlines the business processes. Lean and Six Sigma have been the topic of these debates since long.
What is Lean?
A Lean method is a systematic approach that aims to eliminate unnecessary processes as much as possible through a set of pre-defined rules that dictate a process flow to precisely achieve its goal. Here the unnecessary or waste process is defined as those that add zero value. Here value is completely customer-specific.
It focuses on creating a workflow that develops a smooth and efficient functioning of the organization such that it meets the organizational goals.
What is Six Sigma?
The Six Sigma method uses data to understand the errors in the system and formulates ways to eliminate these errors. These new course corrections ensure optimal streamlining of the organization. Here the customer demands and expectations are kept at the highest priority.
Six Sigma is also a statistical method, which uses data to find out the deviation of the product’s quality from the desired range. The whole process then aims at reducing or eliminating this deviation to produce a high-quality product/service.
While the two methods may sound the same, there are some stark differences between the two. This article discusses both these methods and compares them on various grounds. But first, let’s understand their roots.
The Lean and Six Sigma were both conceptualized and successfully formulated for the first time in different complex manufacturing environments.
Lean way of streamlining processes was originally introduced by Henry Ford, where he focussed on setting high standards of production, thereby eliminating most of the waste. However, the application of Lean practices was limited to a single process.
Bill Smith conceived the Six Sigma concept while he was working with the Motorola company in 1986 as a quantifiable metric that used to analyze the efficiency and share the improvement among the concerned authorities.
This concept came into limelight only when Jack Welch, in 1995, introduced it to improve the overall efficiency during his tenure with General Motors.
What underscores the value of a business in terms of its credibility? The answer would be its happy customers. Both Lean and Six Sigma methods aim to meet the expectations of customers to produce a high-quality product/service.
So what makes them unique in their sense?
It is the way each one of them achieves the ultimate goal, that is, Customer Satisfaction. The goals of each of these two methods revolve around eliminating waste and streamlining processes. However, the way they define this waste is different.
Lean identifies wastes as a process in a business flow that does not add value to the ultimate goal, that is, customers like, for example, the production of goods more than that required to meet the demand.
Six Sigma, on the other hand, identifies waste as something which causes deviation in the process to achieve an error-free final product or, in other words, those elements in the process which are causing hindrance to create a high-quality product or services.
Six Sigma – a Program
Six Sigma uses best practices formulated solely on data to understand and provide reliable solutions to organizational problems. It aims to eliminate deviation and increase reliability in the business process to achieve a high-quality product.
The two main methodologies used in Six Sigma for continuous improvement are:
- Define, Measure, Analyse, Implement, and Control- To solve issues raised in an existing product or system.
- Optimizes existing products to improve their quality to the highest possible extent.
- Analyses the existing process to identify the potholes and makes the required changes
- Implements control measures to avoid repetition of mistakes
- Define, Measure, Analyse, Design, and Verify.- To ensure the newly formed product or services are error-free.
- Aims to build a new process that produces high-quality output
- Analyses the existing resources and produces the best possible design
- Verifies for possible errors and drafts out a control method to avoid them
Lean – a Mindset
Lean is a mindset. It lays down principles that govern human activities on how they should co-exist and form a smart work process. It involves continuous improvement aimed at the removal of waste from the business process.
The value of a process is solely determined by its contribution to the customer’s interest. In this context, Lean defines seven deadly wastes which should be avoided to improve the efficiency of the whole system
- Over-production: Producing more than what is required not only wastes the resources but, also increases the production time.
- Time lag: The workflow should be smooth without any time glitches. Any time where the employee has to wait unnecessarily may lead to untimely delivery of products
- Commutation: Inefficiency in traveling for transporting goods may increase the overall processing time of a product or service.
- Over-processing: Inefficient way to process a product more than it is required
- Inventory: Mis-management of Inventory takes up most of the time.
- Defects: Defects in the end product leads to an unsatisfied customer
In short, Lean is a thinking process, which is governed by wise decision making and organizing skills. Therefore, being lean thinking needs to be embedded in the work culture of an organization, so everyone involved in the decision-making process can feel accountable and hence contribute constructively towards the best lean methods.
Both Six Sigma and Lean methods focus on employee well being. They undergo training at regular intervals to understand the methods implemented in their organization.
The difference here lies in the way these methods define leadership.
- The Lean method encourages both leader cum mentor thinking, where employees take part in decision making and see their manages as more of a mentor who guides and motivates them to do better
- Six Sigma lays down a more structural and hierarchical model of leadership. Here the main advantage is that everyone has pre-defined roles and is consequently monitored. It is more authoritative than Lean leadership.
Areas of Application
As already discussed, Six Sigma is a data-driven method. It, therefore, requires specific tools and resources to be implemented. Also, implementation requires the necessary skill set.
Therefore, Six Sigma finds its application in complex industrial sectors equipped with these qualities. Small and mediocre businesses may not have the required skill set or experience or other resources to implement Six Sigma.
Lean, on the other hand, is an acquired ability to sense the possibility of change and making decisions wisely to improve the efficiency of the system. Many lean thinking practices like agile, scrum, kanban, etc. are easy to adapt for any enterprise. These are also a great tool to imbibe agility to an organization. It may positively affect its reliability to a great extent.
Six Sigma and Lean methods are used by an organization to effectively grow its business by taking good care of customer needs.
Another aspect which both of them focus on is employee satisfaction at the workplace. These methods believe a business thrives if it has a strongly motivated team working relentlessly to produce high-quality products/services. To ensure professionals and enterprise teams are in proper alignment with Lean and Six Sigma practices, they need to get trained in industry-recognized quality management courses to realize the business benefits fully.
Some of the popular Lean Six Sigma courses that individuals and enterprise teams can take up are: