Despite the perverseness of Lean Six Sigma programs, there is a concern if it is still relevant and helpful in the modern world. In this paper I will discuss where and when these process improvement plans succeeded and places where these plans fail to provide desirable results. We will see why some Lean Six Sigma implementation didn’t work and ended up costing the parent company more money in the long run.
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Table of Contents:
1. Industry Week: A Reason to Do Lean and Six Sigma Executives Will Embrace……………………3 2. Wall Street Journal: Where Process – Improvement Projects Go Wrong …………………4 3. Harvard Business Review I – It’s Time to Rethink Continuous Improvement …………………6 4. Harvard Business Review II – Understanding Fear of Process Improvement ……………………..8 5. Conclusion ……………………………………..9 6. Bibliography ……………………………………………..10
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IndustryWeek: A Reason to Do Lean and Six Sigma Executives Will Embrace
Lean Six Sigma is a methodology to systematically remove waste and reducing errors in
production. This IndustryWeek article gives us a glimpse on when Lean Six Sigma works
The article is written by John Dyer, the president of JD&A and has over 28 years of experience in the field of improving processes. The article starts off with Dyer early on in his career as a engineer asking his boss if he can have a meeting with the shop-floor employees to help him fix problems his team is encountering.
The boss refused to take shop-floor employees just to solve problems the engineers like dyer were paid to do. Dyer convinced his boss by telling him, that the morale of the employees will go up if they knew they had an input in how the product was designed, the boss finally agreed to let the engineers have a meeting with the floor employees. The meeting ended up being very successful, the engineers with able to solve problems they have been working on for months in days just by talking to the employees who actually build the final product. The meeting ended up being so successful, the repair department of the company become upset that the engineers were improving the product to a point where the repairmen would be losing their jobs. The collaboration eventually ended but Dyer got a taste of how much difference it makes if the company were to work together to efficiently solve issues.
In the next company he was working at, their daily output was not meeting their customer demands and they were behind with a massive backlog of orders. The company hired Jane Robinson to come in and fix their backlog situation. Jane noticed a trend in the production, the factory was able to produce 2,300 units/day and their customer demand was only 1,800 units/day, however even though the factory could produce 2,300 units/day they were only averaging about 1,300 units. Some days the factory only produced 300 units. Robinson explained
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the lack of consistency was caused by Capacity leaks. Capacity leaks are areas of the manufacturing where there is constraints and bottleneck and causes that part of the system to lose system capacity and overall makes the factory less efficient.
Robinson’s solution was to take the employees out of the production line and have them be trained in the tools and methodologies of LEAN and Six Sigma. The employees will be trained and begin forming improvement teams, one per process that impacts the output of the factory. After several months, all the training was completed and the employees were properly able to identify issues that are hurting their production line. A year down the line they maintained a constant 2,250 units/day and the program was deemed successful. Dyer says all outputs of a production company can be predicted and the company can properly prepare their employees to be identify these capacity leaks and create a stable, predictable system. He continues and says even companies who operate on a seasonal basis can still use this system to be predictable.
When Lean Six Sigma works, it works really well, let’s look at a situation where it doesn’t and try to understand why it didn’t.
When LEAN Six Sigma Doesn’t work:
The Wall Street Journal: Where Process-Improvement Projects Go Wrong
This article by Satya S. Chakravorty is based on research him and his team did on process- improvement programs at large companies over a five – year period. Chakravorty states that over 60% of all Six Sigma initiatives fail to yield desirable results after a period of time. Initially Lean Six Sigma works and produces massive benefits for the company but over time the participants
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lose motivation and fall back into the old way of doing things. The author compared this phenomenon to a spring with applied force.
In the initial stretching phase, similar to the spring the participates are willing to stretch to make the improvements a success. Chakravorty based this article on one particular aerospace company he used in his research for the program. In this unnamed aerospace company, Lean Six Sigma experts came in and started identifying which departments they should focus on in the beginning. After the experts identified where the improvements needed to take place, they made a plan and forwarded this to the employees and managers. The author credits the initial success on the top executive putting pressure on the managers making sure this improvement planning is working.
The managers then had their eyes on the employees and their effort, the employees worked hard and try to improve their section of the system while unknowingly hurting other parts just to satisfy the program. After the expert deem this section of the system to be a success, they move on to the other department where there is a problem that needs to be fixed. The author calls this the yielding phase, where the spring is struggling to accommodate the force being applied on it. After the experts leave, the works struggle to maintain the lean six sigma implementation, without the expert telling them what task to prioritize, the team can’t agree on new goals and overtime the team will revert to their old habits and stop improving and in some cases their work performance will be worse than before the process improvement program.
The last stage is called the Failing stage, where the force applied on the spring overcome the breaking point and the spring fragments into multiple pieces. This failing stages takes place long after the process improvement experts leave, the participants are now unwilling or unable to perform the task at hand without having clear direction constantly being thrown at them. The
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employees at this unnamed aerospace companies, stopped caring about the project because the morale sagged overtime and the improvement was not tied to their performance reviews. Even though the company profited from the initial improvement, the employee’s salary did not go up, they had no motivation to keep performing at that level.
The author points out ways to implement a successful Lean Six Sigma program, he suggests the employees should get a raise even if it’s a small one. Even the smallest raises will motivate the employees to work harder to implement the plans. The author also suggest the improvement teams should be limited to six to nine members and the program should last no longer than six to eight weeks. The small number of members in the team will stop the team from having competing interests making it harder to implement the improvement plans. The short implementation timeline will allow the company to fully focus on one section without having to divert sources to other efforts.
Lastly, the top executives who benefit most from the process improvement project should not just support their team but also directly participate in the program. Executive can make better decision on important changes in their company if they took time to learn the improvement plans and knew exactly what needed to be improved and why. So far, we learned that Lean Six Sigma doesn’t always work, so maybe we should rethink this whole process improvement idea and abandon it?
Harvard Business Review: It’s Time to Rethink Continuous Improvement
This article goes deeper into Lean Six Sigma not being compatible with some companies.
Japanese companies were the early adopter of the using analytics and systematic approach to fixing manufacturing issues. This new and innovative approach changed the worlds perception of
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Japanese goods. Japan was once considered to be the worst when it came to quality and reliability. Change in the 1970s started when the country was able to produce and dominate the automobile and Consumer electronic market through the help of process improvement. However, in recent years, Japanese automobile lost market share to South Korea car companies such as Hyundai, Kia and even American companies such as Tesla. Even companies such as Motorola, who invented Six Sigma program has been struggling in recent years.
So why are all of these companies no longer benefitting from Lean Six Sigma programs? It’s because companies that heavily invest in process improvement programs only think about metrics a quality management, they keep on improving quality while hurting innovation. The culture for innovation and process improvement is completely different but it can be implemented together to work. Lean Six Sigma programs adds considerable value to a company and shouldn’t be disregarded to endorse innovation but instead decide where and when process improvement should be used.
A car manufacturing plant has a good place for these programs but a car research and development shouldn’t be impaired with these systematic methods of improving. Also understand if a certain area of hindrance needs improvement or it needs to completely eliminated. In the modern area, there are many jobs that no longer have use in the professional environment, it will be easy and more efficient to terminate these jobs than to improve the efficiency of performing them. Finally give heed to the impact of Lean Six Sigma on company working environment, is it hurting the employee’s morale and motivation? Is it making the company an undesirable place to work for? data obsessed environment strengthens cost focused, numbers game like environment instead of a place that explores new ideas and innovates through employee’s interactions.
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How else can we improve Lean Six Sigma implementation? We will look at another article from the Harvard Business Review.
Harvard Business Review: Understanding Fear of Process Improvement
While culture of continuous improvement can be detrimental to the innovation sector of a
company it is still crucial to the organizational performance and survival. In this article, the author tries to determine why Six Sigma or Lean are successful sometimes and fail horribly other times. Some say it’s because the lack of leader’s interest in the subject, others say because the company didn’t implement the Six Sigma or Lean program properly. The author narrows down the real reason to be the fear of change. People are fearful of leaving their habitual way of doing things and fail to try something new and experimental.
New experimental ways can greater improve a situation or it can cause utter distraction to their practice if it didn’t work, the will to survive overpowers them and stops them from wanting to change. To eliminate fear of change, we must first dispose of failure, we must allow our participants to fail and embrace the failure to learn from it. In the previous articles, they mention showing employees their effort is being rewarded keeps the effort from sagging, promotions or raises will the best way to show this reward.
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Conclusion
Lean Six Sigma doesn’t always work, but they are crucial to a company’s survival. The programs are only detrimental to companies who fail to properly execute the idea. The company should not blindly implement process improvement in all of their department, take time and see if the improvement programs will destroy innovation or morale of the employees. Reward the employees for working harder and bringing the company more profit, this will keep them at their best and the effort will be reward. Lean Six Sigma doesn’t always work but with this important changes we can make their implementation more successful.