Where does Lean come from?


Lean has a very close link to the Henry Ford's early line assembly system at RiverRouge. Sakichi Toyoda's son Kichiro visited Ford manufacturing facility and got the understanding of the concepts behind it and more importantly the problems incorporated to that system. This is a very strong evidence to prove the closer relationship between Ford system and Toyota system.

Although the concepts were developed by the owners themselves in the initial stages, the father of lean manufacturing is considered as Taiichi Ohno. Taiici Ohno says whatever he learned of Lean, it was from Henry Ford. If you read the book "Today & Tommorow" by Ford, you would believe what Ohno said. He understood the principles behind lean and then developed them to suit the requirements of Toyota. Definition of waste, maintaining customer supplier relationship internally and externally, empowerment and respect to people, idea generation and using of ideas generated by employees to the betterment of the organisation, ability to adopt to the fast changing situations, looking into the bigger picture by avoiding sub optimisation, simplicity are among the key features of any lean system.

Today the Lean concepts have reached many other industries including healthcare, service providers and even military. The variety of organisations that are practicing Lean concepts in them goes to show the universal applicability of Lean concepts or Lean thinking. Lean practices may be unique to the implementation but the Lean thinking is universal.

Lean is a conceptual change to the system and not just short term change in the system. This requires lots of change management and care for people. People are the most important resource for any lean manufacturer. If anyone wants to cut down in number of heads it should not be in the name of Lean. Lean is not about cutting corners either. It is about elimination of waste from the system continuously. Many implementations of Lean fail due to the lack of understanding on basic Lean concepts and general knowledge, not because of the problems in lean itself.

Now the Lean has gone over its premises of operations and are now becoming Lean Enterprises. Lean enterprises consist of customers and suppliers of the manufacturer. They help each other in the process of value creation and ultimately getting rewarded collectively for their efforts. Large amounts of wastes do exist in interfaces where each party separated in the supply chain. In today's competitive markets most of the companies are willing to reach their suppliers and customers and treat them as partners not as separate parties. 


Lean and Six Sigma Q&As


What is Lean?

Lean involves the systematic removal of waste from business processes. Typically, an organisation's employees are trained to work in teams and apply a series of tools and techniques. The focus is on identifying value-adding and non value-adding process steps. A value-adding step is defined as anything which the customer is willing to pay for in the transformation of material into customer requirements.  The team then streamlines the processes selected for improvement, takes out waste and this activity usually reduces cycle time. The result is faster, slicker processes which enhance customer satisfaction and reduce cost.

What is Six Sigma?

Six Sigma usually refers to a project-based continuous improvement methodology aimed at reducing defects in processes, in manufacturing and service industries. It can be applied in every industry and in every department. Typically a company's employees are trained to work in teams and apply a series of rigorous tools and techniques to improve processes, profitability and customer satisfaction .The Six Sigma methodology can also be applied in not-for-profit organisations to improve service delivery and value for money.

Why do companies need Lean or Six Sigma?

Many companies have issues such as customer complaints, missed deliveries, high costs, lost market share, high staff turnover or low morale. In all these cases Lean and Six Sigma techniques can be applied to good effect.

Will Lean and Six Sigma work in all organisations?

Every organisation has processes. Every organisation has employees with tendencies to do things their own ways, which can lead to misunderstandings, mistakes and rework. Customers want fewer mistakes and things done more quickly. Lean tools will reduce cycle times and mistakes. Six Sigma techniques will find and eliminate defects.

Why use Lean and Six Sigma together?

If Lean techniques are applied alone, and the cycle time of doing things is cut without reducing mistakes, an organisation will just be making defects faster. If only defects are reduced and things take as long as they always did, an organisation runs the risk of remaining uncompetitive. 

Is prior experience of continuous improvement necessary before starting to use Lean or Six Sigma techniques?

With the right approach and tailored support, it is possible for organisations to benefit from Lean and Six Sigma with no prior knowledge. Ideas for improvement projects can easily be selected from existing customer and process issues that employees have been coping with for some time. Many successful improvement projects have been delivered using the Six Sigma methodology by employees with no prior knowledge of statistics.

What benefits can be seen from applying Lean or Six Sigma?

More can be achieved with less. The ratio of costs to sales will improve because customers will see improved quality, delivery and lower costs and as a result will be able to give the company more business. Employee turnover will reduce and many non-value added processes will simply disappear. Market share and profitability will increase. Continuous improvement will replace fire fighting. Not-for-profit organisations will improve service delivery and value for money.

How long will it take to see results?

It depends which techniques are used. Improvements with Lean waste removal techniques occur within days or weeks. Problems with unknown, often deep-seated root causes need the patient systematic rigour of Six Sigma problem solving, and training project results will take 3-6 months to show through. More experienced practitioners are able to use the Six Sigma tools to solve thorny problems and achieve sustainable results in 1-2 months.

How much will it cost?

The cost depends on what is expected in return. Establishing a Lean and Six Sigma culture in an organisation provides an excellent return on investment as the improvement projects carried out realise considerable financial benefits. In some organisations a modest initial investment can be increased over time as the benefits are realised.

Is it essential to do projects?

Doing projects is part of the knowledge transfer process. Employees learn the tools and techniques as they apply them to real situations in their organisation. Six Sigma and Lean are practical methodologies - it is not enough just to learn the theoretical principles. Putting the tools and techniques into practice realises considerable benefits and the methodologies become embedded in the organisation's improvement culture.

When can organisations expect to be self sufficient in continuous improvement?

Companies and not-for-profit organisations vary in the time it takes them to be able to  manage their own sustainable improvement activities using Lean and Six Sigma techniques without outside support, but on average it is often within 14-20 months. With the right systems in place from the start, self-sufficiency can be achieved earlier.



5 Simple Process Improvement Steps


A quick tutorial on the five steps to improving a process based on Lean Six Sigma: 

Step 1 – Define the problem

The definition is extremely important, and must be specific and precise. To guide this process, we suggest you use the following questions:

  1. What is the problem?
  2. When did it start?
  3. Who owns it?
  4. What is the goal and objective? These are typically referred to as SMART objectives — Specific, Measurable, Achievable, Realistic, and Timely.
  5. What are the financial benefits if improved?
  6. Who are the customers of the problem?
  7. What are the customer’s expectations?

Though this seems simplistic, I am sure you would agree, in the hustle and bustle of life we sometimes skip ahead and try to solve problems without taking the time to up front to gain a better understanding of how the problem started in the first place.

There are also SMARTER objectives, with the “ER” standing for “Easily Remembered.” When defining the problem, be precise, and it should be so precise as to be easily remembered.

Step 2 – Measure the problem

Without data to measure, you cannot fix a problem. The problem must be measurable.

Step 3 – Analyse the data

Based on the data, where is the root of the problem?

Step 4 – Improve the problem

Using a team of experts on the problem to develop measurable solutions and then test the solution and assess the data for 95% confidence of statistical improvement. Data must tell you that the improvement is the solution.

Step 5 – Control the improvement

Put Standard Operating Procedures (SOPs) in place to make sure the improvement stays in place. Too many times a problem is solved with a new improvement but people go back to their old ways, and the improvement is negated.

This 5 steps are also known as DMAIC (dee-make), the core Six Sigma improvement framework.