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Lean & Six Sigma Overview

Yudha Satya Perdana

Sheraton Media Hotel & Towers

2YSP © 2008 Sheraton Media Hotel & Tower – www.sheratonmedia-jakarta.com

History of Development of Lean Six Sigma Methodology

Shewhart –Statistical method

F. Taylor –Time/motion study

Craft production

Eli Whitney –Product standard

Deming –Statistical method

Juran –Process analysis

Smith/Welch –Statistical rigor/Org. infrastructure

Ford –Work Analysis

Sloan –Modern management

Toyoda,Ohno,Shingo –

JIT, World class Mnf

Womack & Jones

Lean Six Sigma

Six SigmaLean Enterprise

TQM

Toyota Prod. System

Mass production

Quality control

SPC

Assembly line manufacturing

Scientific management

Industrial production

Organized labor –Worker’s right

George, Lockhead,Martin, others

1900

2000

1950

1850

Source: “Lean Six Sigma: A Fusion of Pan-Pacific Process Improvement”, Malcolm T. Upton (Master Black Belt, George Group)

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Lean & Six Sigma – Focus & Point of View

A Lean system views waste as anything that does not produce value, but Six Sigma views waste as process variation.

Lean focuses on process flow, and Six Sigma focuses on process variation which causes defects.

Lean uses process flow tools like value stream mapping, process mapping etc. to eliminate waste. Six Sigma uses methodologies like DMAIC and DFSS to eliminate problems. Six Sigma uses statistical tools and analytical tools to find out the root causes of process variation and eliminate them.

Six Sigma, like Lean Thinking also focuses on customer satisfaction, prevention of defects and waste, and cycle time reduction.

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Formation of Lean Six SigmaStrength/Focus of Lean & Six Sigma• Six Sigma is most closely associated with defects and quality.• Lean is linked to speed, efficiency, and waste. Lean provides tools to reduce lead-time of any process and

eliminate non-value add cost.

Deficiency of Six SigmaSix Sigma does not contains any tools to control lead time (e.g., Pull systems), or tools specific to the reduction of

lead time (e.g., setup reduction). Since companies must become more responsive to changing customer needs, faster lead times are essential in all endeavors.

Improvement of Six Sigma Lean Six SigmaLean is an important complement to Six Sigma and fits well within the Six Sigma DMAIC process. Additionally, the

Lean Kaizen approach is a great method that can be used to accelerate the rate of improvements.Company needs to improve quality so it can achieve maximum speed, and company also needs to do the things that

allow maximum speed in order to reach the highest sigma levels of quality. In other words, it is required to have both Lean (speed) and Six Sigma (quality) principles and tools to drive improvements in ROIC and achieve the best competitive position.

.BenefitsThe processes of all companies and organizations are required to:

1. Become faster and more responsive to customers2. Achieve Six Sigma capability (very high quality / very low defect rate)3. Operate at world class cost

Combination of Six Sigma and Lean is expected to fulfill all three goals. Lean Six Sigma creates a value stream map of the process identifying value add and non-value add costs. Projects within the process are then prioritized based on the delay time they inject. This prioritization process inevitably pinpoints activities with high defect rates (Six Sigma tools) or long setups, downtime (Lean tools). In manufacturing, a further benefit will result from a reduction in working capital and capital expenditure.

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Identify value stream and eliminate waste

Continuously improve in pursuit of perfection Control

Champion, Green Belt, Black Belt, Master Black Belt

Analyze

Involve and empower employees

Strategy Driven (Top Down)"Popular" (bottom up)Project

Identification

Everybody job (Green Belt) dedicated resource (Black belt)

Part of everybody's jobResponsibility

Senior Leader, SenseiOrg. Structure

ImproveMake value at pull of customer

Measure

DefineSpecify value in the eye of customer

Guideline

Reduce VariationRemove WasteFocus

Six SigmaLean Thinking

Improvement Management Systems ComparisonDRAFT

17 Mar 2007