Lean The term "lean" comes to us from Japan and was first described to Americans in a book titled The Machine That Changed the World. This book compared U.S., European, and Japanese car manufacturing. The authors described Japanese management practices that enabled its stunning success in the automotive and consumer electronics businesses. What they described was the Toyota Production System, which they called "lean." Below are some characteristics of lean companies:
- Lean companies take half the human effort. - Lean companies have half the defects in the finished product /service. - Lean companies require one-third the engineering effort. - Lean companies use half the floor space for the same output. - Lean companies have 90 percent less inventory.
In summary, Lean is about eliminating waste by improving process flow and reducing process complexity.
Six Sigma Six Sigma's roots go back to the mid-eighties with Motorola. At the time, Motorola's CEO, Bob Galvin, challenged his company to achieve a tenfold improvement in performance over a five-year period. This quantum leap in quality improvement required a radically different approach. By implementing Statistical Process Control Theory, Motoral began measuring quality in terms of an unheard of Defects Per Million Opportunities (DPMO). Motorola equated Six Sigma with only 3.4 DPMO or achieving 99.9997 percent reliability.
Six Sigma is a highly disciplined problem solving process that strives to develop and deliver near perfect products and services consistently. Below are some examples:
AT&T: The reliability of getting dial tone when you pick up a telephone. FedEx: Knowing you package will be delivered by 10am the next day. McDonald's: A Big Mac tastes the same whether you're in Atlanta or Los Angeles.
In summary, Six Sigma is about reducing variability and building highly capable processes.
The combination of Lean and Six Sigma can produce powerful results in terms of driving key Operational, Financial, and Customer Satisfaction metrics.
