Lean & Six Sigma Overview Yudha Satya Perdana Sheraton Media Hotel & Towers

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

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. 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.

Formation of Lean Six Sigma Strength/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 Sigma Six 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 Sigma Lean 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. . Benefits The processes of all companies and organizations are required to: 1. Become faster and more responsive to customers 2. 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.

Strength/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 Sigma

Six 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 Sigma

Lean 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.

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Benefits

The processes of all companies and organizations are required to:

1. Become faster and more responsive to customers

2. 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.

Improvement Management Systems Comparison DRAFT 17 Mar 2007 Identify value stream and eliminate waste Continuously improve in pursuit of perfection C ontrol Champion, Green Belt, Black Belt, Master Black Belt A nalyze 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 job Responsibility Senior Leader, Sensei Org. Structure I mprove Make value at pull of customer M easure D efine Specify value in the eye of customer Guideline Reduce Variation Remove Waste Focus Six Sigma Lean Thinking