6 Sigma process optimization technologies. Lean Six Sigma Lean Six SigmaLean Manufacturing MethodsLean Manufacturing

Michael George Chapter from the book “Lean + Six Sigma in the Service Industry. How Lean Speed ​​and Six Sigma Quality Help Improve Business"
Publishing house "Mann, Ivanov and Ferber"

Rice. 2. Normal distribution The limits of the normal distribution are 6 a

The indicators used in the Six Sigma concept allow you to compare the distribution of actual results with a range of acceptable values ​​(customer requirements). A defect is any value that does not meet the customer's requirements. The greater the area under the distribution curve that falls within the range of customer requirements, the higher the sigma level. To compare different processes, the concept of “percentage” of defects (or “defects per million opportunities”) is used instead of the number of defects.

The Six Sigma level is a process that produces 3.4 defects per million opportunities, taking into account expected variances.

Here's one example: Any company that planned to build in Fort Wayne soon found out that doing business in this city was problematic, to put it mildly. Among other things, simply obtaining the necessary permits often took almost two months (an average of 51 days). A team of city staff conducted benchmarking and identified gaps that were preventing Fort Wayne from competing with other cities that had resolved a similar issue in less than a month.

The team tasked with improving the permitting process soon identified the most critical steps, eliminated unnecessary steps, and developed standardized procedures with clear guidelines. With the new process in place, 95% of permits were issued in less than 10 days. Many customers - businesses that were previously reluctant to build in Fort Wayne - immediately noticed this improvement.

The ABCs of Lean Manufacturing

Every discipline has its own language, and lean manufacturing is no exception. There are a number of terms that you will need to understand lean manufacturing and explore its capabilities (all of which you will encounter in this book).

Lead time and process speed

Lead time measures how long it takes to deliver a product or service from the time an order is received. A simple formula known as Little’s Law (named after the mathematician who proved it) helps to understand the factors influencing order fulfillment time:

This equation allows us to determine how long it will take to complete a unit of work (lead time) by knowing the amount of unfinished work (work in progress) and the amount of work we can complete per day, week, etc. (productivity).

Little's Law means much more than it might seem at first glance. Most of us have no idea about productivity, let alone the level of deviation. The very thought of having to track every step of the order fulfillment process - especially if the process takes several days or weeks - makes us despondent. (Think about the Fort Wayne permitting process and imagine what it's like to track a process that takes 51 days.) Given the values ​​of the two variables in this equation, we can determine the third. In other words, if you know your work in progress and productivity, you can determine the lead time. If you know the lead time and productivity, you can estimate the amount of work in process in the process.

Unfinished production

Sometimes those involved in the provision of services avoid the term “work in process”, since this term is traditionally associated with the production line. However, the concept itself is applicable to almost any process. If you feel the need to transform this lean manufacturing terminology to apply to your business, try thinking of work-in-process as “objects” in a process. These "objects" could be customer requests, receipts that need to be processed, phone calls that need to be answered, reports that need to be completed, etc. - any work that needs to be completed. The term "work in progress" is used almost everywhere in this book. When faced with it, think about your own work and how many unfinished tasks are lying on your desk, waiting in the wings on your computer or on your answering machine. All this is work in progress.

The goal of lean manufacturing is to ensure that you have enough resources and work gets done at the right pace according to the customer's needs. More importantly, through a standardized process, lean manufacturing allows you to quickly respond to customer signals, which means that it makes the process predictable, controllable and stable.
Jim Kaminsky, Assistant Vice President, Bank One

Delays/waiting times

Work in progress means there is work waiting to be done. In lean manufacturing parlance, this work is “queued”; and the time during which it is not attended to is called "waiting time." Queue time, regardless of length or reason, constitutes delay.

Value-adding and non-value-adding work

When you start tracking the flow of work, it becomes clear that some activities add value from the customer's perspective (and are called value-adding work for this reason). To test whether a given job adds value, ask yourself whether your client would be willing to pay for it if they knew it was included in the overall price of the product. If, in all likelihood, he refuses to pay for it or prefers to do business with a supplier who does not have such costs, this is non-value-added work.

Process efficiency

For any service delivery process, a very important indicator is the proportion of total cycle time that is spent on value-adding activities. This indicator simultaneously shows the share of losses and is called process cycle efficiency. It represents the ratio of value added time to total order lead time:

Process Efficiency = Customer Value Added Time / Total Order Lead Time.

If the process efficiency is below 10%, then the process is loaded with non-value-creating waste and can be improved.

Losses

As we just showed, waste includes everything that does not add value from the customer's point of view: time, cost, work. There is a certain amount of loss in all organizations, since there are weaknesses everywhere. These are the ones that should be eliminated during optimization. The volume of losses in any activity is proportional to the duration of delays in the progress of work. Lean teaches us to recognize and eliminate waste rather than mindlessly follow the beaten path. In lean manufacturing practice, there are seven types of waste.

Key Lessons from Lean Manufacturing

The above allows us to draw several seemingly very simple, but extremely important conclusions, indicating that with the help of lean manufacturing we can quickly achieve improvements. These are the conclusions that will be discussed in more detail below.

1. Most processes are not “lean” and have a process efficiency rate of less than 10%.
2. Reducing work in process (WIP) is paramount (unless you can't control WIP, you can't control lead times).
3. Every process should operate on a pull system rather than a push system to eliminate lead time variance.
4. About 20% of work causes 80% of all delays.
5. You can't improve what you can't see: you need to visualize the process based on data.

Lesson #1. Most processes are not "lean"

I think you won't be surprised to learn that in lean service processes, the bulk of the work—50% or more—is in non-value-adding activities. This can be visualized on a process map using colors or other techniques to visually distinguish value-adding work from non-value-adding work. So, fig. Figure 3 shows the initial portion of a basic block diagram compiled by the Lockheed Martin team. This team found that 83% of the work performed between a purchase order and product receipt did not add value (that is, wastage). These include correcting errors, requesting price quotes from wholesalers (although prices can be negotiated in advance), obtaining revised drawings, and other actions caused by delays in earlier stages of the process.

Can speed come at the expense of quality?

We've all been in situations where the pressure to "go faster" has created quality problems and slowed down processes as a result. Therefore, it is quite reasonable to be concerned: will a lean approach aimed at speeding up the process cause damage to quality? This doesn't happen. Why? Because the application of lean manufacturing reduces time by eliminating non-value-adding activities, eliminating queues, reducing the time between value-creating activities, etc. The most important stages of the process that provide value to the customer are generally left untouched by the lean manufacturing method. Applying Six Sigma tools to value-adding activities reduces defects, which in turn speeds up value-adding steps.

However, since these stages typically account for less than 10% of the total order lead time, increasing the speed of value-adding processes has little impact on the speed of the overall process. Impact only increases measurably when non-value-adding activities are eliminated.

Rice. 3. Simple flowchart (visually showing value-adding and non-value-adding activities)

The Lockheed Martin Supply Center team discovered that most of the work from the time a purchase order was placed to the materials received was waste (non-value added). Measures were taken to compensate for errors, omissions and delays at earlier stages of the process, as well as measures to reduce the huge variety of heterogeneous tasks (complexity). Detailed development of the value stream (representing 248 stages in the necessary detail) and subsequent reduction of complexity through standardization eliminated most of the waste. The results of these improvements allowed the company to cut supply costs in half.

Lesson #2. The primary task is to reduce work in progress

Let's go back to Little's Law again.

Lead time = Work in progress / Productivity.

This equality is not just a theoretical construct; it has many practical consequences. First of all, it shows that there are two ways to reduce lead time - either by reducing work in process or by increasing productivity. In any operation that does not involve direct customer contact—that is, where work in process consists of orders, emails, or reports rather than people—it is much easier to control work in process than to improve productivity. In fact, you can speed up any process - reduce time spent - simply by reducing work in progress and doing nothing to improve productivity.

This finding explains how lean manufacturing principles can quickly achieve positive results. It is only necessary to limit as much as possible the volume of work received for processing per unit of time. The following describes what to do if work in progress is “people” and the optimal way to maintain order lead time is to connect additional capacity to increase productivity.

Why should we prioritize work in progress? To reduce its volume, only intellectual capital is needed. Increasing productivity requires investment or an increase in the payroll, both of which negatively impact the return on capital invested and therefore shareholder value. Little's Law provides the mathematical basis that allows us to apply lean manufacturing methods to any process.

Lesson #3. "How do we reduce this damn work in progress?" (Creating a "pull" system)

Take a look around your workspace. Is your email inbox full of unread messages? Do you have a long list of emails that will take several days to review? Is your answering machine refusing to accept new messages? Is anyone waiting for the results of your work?

These are all different forms of work in progress, work that someone else - a colleague or a client - expects from you. As a convert to lean manufacturing, you know that to reduce cycle times and waste, you must reduce work in progress. You know that work in progress is like cars on a freeway: if there are more cars, the speed of traffic on a congested road will decrease! But how to do that?

Naturally, you cannot limit the amount of work-in-process in processes directly related to the customer, when the work-in-process is customers waiting for service or wanting to purchase a product (in such situations, there are other ways to maintain or reduce lead time).

For any job where you don't have a client in front of you, Little's Law provides the key to reducing work in progress. In lean service delivery processes, there is a stage that precedes the process as such, a stage at which the “accumulation” of input factors (work requests, orders, calls, etc.) occurs. Someone then controls the input of these “factors” into the process.

Consider the following example. Independent distributors needed quote information from the marketing department to determine construction cost estimates. They were unhappy that it took the marketing department two to three weeks to provide this information. The period that suited them was three days.

The task force spent several weeks collecting data that showed that marketing staff could process an average of 20 proposals per day. Distributors wanted a guaranteed 3-day turnaround; The data obtained indicated that process deviation required achieving the more stringent target of 2.4 days.

How much work in progress was allowed in this process? By using Little's Law and plugging in 20 (productivity) and 2.4 (lead time), the team found a maximum work in process of 48 proposals, the number of proposals "in progress" at any given time.

Lead time = 2.4 days = (WIP = 48 proposals) / (Productivity = 20 proposals/day).

To manage such a system, they created a stand to visually display information about the number of proposals being processed. The maximum allowable amount of work in progress was 48 applications, so until their number dropped to 47, the department employee could not begin processing new applications, as shown in Fig. 4.

The secret that makes this system work is in the lower left corner of Fig. 4, which shows a drive labeled “input”. (Depending on the nature of your work, this repository may be a physical receptacle or an electronic database.) Applications do not formally enter the process while they are in the raw material repository. The only signal for submitting work to the input of the process is the output of a unit of product from the process - this is the “pull” system. The guaranteed period for providing the service is about two and a half days, counted from the moment the application is received into the process. In other words, the pull system in the service industry means making deliberate decisions about when to put work into the process. However, how such decisions are made is very important: value must not be lost sight of. In this case, it is a question of which application is entered into the process when the processing of the other application is completed. Processing bids on a first-come, first-served basis is unlikely to be appropriate here, since some bids promise promising large-value orders, while others involve small orders, contain questionable quotes, or are likely to be rejected.

Rice. 4. Pull system for commercial offers for sale

The issue of processing order can be resolved by determining the priority of proposals depending on their prospects. Each application is characterized by the following three parameters, each of which is assessed using a three-point system:

• complexity of calculation;
• competitive advantage;
• gross profit in dollars.

The scores for each criterion for each proposal are multiplied. Proposals with the highest ratings are submitted for processing first, even if other applications have a longer wait time. (A new application with a rating of 9 is entered into the process faster than an application with a rating of 6 previously submitted). Using such a system, the marketing department staff, with the same number of employees, was able to ensure an increase in gross income by 70% and increase gross profit by 80%. (Of course, the company could increase productivity by increasing the size of its marketing department and incurring enormous costs.)

How to create your own pull system?

How to make such a system work for you? Below is an approximate sequence of actions.

1. Determine/validate the desired level of service. Ask the client what level of service is desired for him.
2. Determine how quickly your work team can complete work (based on data).
3. Use Little's Law to determine the maximum allowable amount of work in process.
4. Limit the amount of work in progress to the resulting maximum value.
5. Place all incoming work in the input hopper.
6. Develop a prioritization system for the order in which work is entered into the process from the drive.
7. Continue to make further process improvements that will allow you to increase the speed of work completion and achieve further reductions in lead times.

The positive impact of Lean Six Sigma on these types of situations is two-fold: First, in service delivery, decisions are made in a way that has never been the case before, based on data (demand variances, work-in-process, and productivity). Secondly, it uses tools of speed and quality, which are adopted by those who are willing to spend time and effort to get the job done.

Carefully! Don't treat your customer like inventory or raw materials!

The “pull” system described above works when documents, emails, phone calls, etc. are submitted as input. But in the face-to-face customer experience, you must maintain response times and service performance at an acceptable level so that no matter what happens. When the work-in-process is customers, you cannot create inventory from them, just as you cannot increase the waiting time for a service, and therefore the order fulfillment time. Little's Law says that the only option in this case is to increase productivity.

One of the challenges of direct-to-customer operations is high demand variance, with busy periods alternating with periods of slow business activity.

If the dynamics of this rotation are predictable, productivity can be increased by changing the number of service personnel accordingly: additional workers can be brought in during peak hours, as is done in call centers. If demand variances are unpredictable, you should apply queuing theory, which allows you to calculate how various factors, such as supply or demand variances, affect work in progress (and therefore lead time). For example, fig. Figure 3.11 from Lean Six Sigma: Combining Six Sigma Quality with Lean Speed, which is reproduced in Figure 3.11. Figure 5 shows that if you have a capacity slack of 20%, variation in demand has virtually no effect on customer wait time.

Rice. 5. The negative impact of deviation is greatest when operating at the performance limit.

Spare capacity can be provided by drawing in personnel from other departments who are trained in related skills, or by using a priority system (as in the “pull” system described above) in which more complex services are assigned to more experienced employees.

Lesson #4. Process efficiency allows you to quantify your capabilities

Typically, the efficiency of processes in the service sector is about 5% (Table 1), that is, 95% of working time is spent waiting. Terrible? Still would. It's not just a matter of delays. The old saying is true: the longer a job is left unfinished, the more it costs. In lean processes, value addition time accounts for more than 20% of total cycle time.

Table 1. Process efficiency

Don't be surprised if you find that your organization's process efficiency is below 5%. Don't be discouraged. Experience shows that by applying the basic tools of Lean Six Sigma, you will quickly begin to reap the benefits and be able to reduce costs by at least 20%.

Process efficiency can be visualized by separating value-added time from non-value-added time on a value creation time graph, as shown in Figure 1. 6. (This kind of visual representation helps get people excited and interested!)

Rice. 6. Time axis of value creation

The idea of ​​a value creation time map is quite simple. It is necessary to trace the process of processing any unit of production and classify the time spent into one of three categories: 1) value-added, 2) inevitable losses - they are an integral aspect of doing business (work for which the client does not want to pay, but which cannot be done without - accounting, compliance with legal and other regulations) and 3) delays/losses. Then draw a timeline and plot all three categories on it. In the Lockheed Martin procurement example, you can see that it takes four days from the time the supply center receives a requisition until the order is placed. The value-adding activity (shaded areas above the midline) shows that during those four days, the buyer spent 14 minutes processing the order. Most of the time that is depicted as empty space represents waiting time. Initially, this process had an efficiency of less than 1% (14 minutes out of 4 days, or 1920 minutes).

The time axis of value creation tracks the movement of a unit of output through a process and accounts for the time spent. Above the middle line is time that adds value from the customer's perspective; the rest is losses.

Lesson #5. 20% of work causes 80% of delays

The main goal of lean manufacturing - speed - can be achieved in one and only way: get rid of everything that slows down the process. Mapping your process and collecting data on cycle times, variances, and complexity will allow you to calculate latency at each individual process step. Experience shows that in any process with efficiency of 10% or less, 80% of the lead time is “eaten up” by less than 20% of the activities - another example of the Pareto effect in action! This 20% is called “hidden time waste,” which becomes apparent when creating value stream maps and can be represented as a value creation timeline (as in Figure 6).

Identifying hidden losses is one of the most important problems, since the priority in this case is determined by the duration of the delay. By correctly prioritizing your targets, you will have powerful leverage over your financial improvement efforts.

Lesson #6: You can't improve what you can't see.

If the opportunity to reduce costs and lead times in the service industry is so great, why not use Lean Six Sigma more often?

One of the obvious benefits of production is the ability to see and track the flow of work. You walk along a production line and see how a product is processed and how, moving from one workplace to another, raw materials or materials are transformed into the final product. This flow is always documented in the dispatch department, which records the value-adding work. In addition, you see tangible evidence of waste (products requiring rework, production waste, delays) in the form of piles of work in progress or defects.

In service delivery, much of the work remains invisible. With one keystroke, someone sends a report to another office down the hall or anywhere in the world. Someone presses a button on a phone and switches a customer from one department (such as customer service) to another (technical support).

In the service industry, it is more difficult to see more than just the flow (process). Almost as difficult is estimating the amount of work in progress. Yes, some of us can estimate its volume by looking at the pile of papers on the table or counting how many people are standing in line waiting to be served. But more often than not, “work” takes on less visible forms—for example, electronic reports or orders waiting to be processed, 20 emails to respond to, 10 clients hanging on the phone line.

But while it's difficult to make work flow visible in the service industry, understanding it and estimating work-in-process volume is a prerequisite for using lean manufacturing tools to increase speed and reduce waste. To “make the invisible visible,” you can use a variety of maps, including the value stream maps that you will see many times throughout this book (see Figure 7 for an example of such a map).

Rice. 7. Value stream map (process flow map)

In addition, Fig. 7 shows that many management processes are overly complex. For example, at one company, approval for a design change requires the signature of seven managers, and the approval form spends weeks traveling through seven incoming document trays. This service delivery process causes serious problems in the manufacturing process because it interferes with timely changes to drawings (and the products that are manufactured from those drawings). The long cycle of this decision-making process means that once quality problems are identified, rework will continue for a very long time, even after new drawings have been created that can be used to produce defect-free products.

When the company examined the processes for obtaining all seven signatures more closely, it became clear that five of the seven managers did not have the knowledge and qualifications relevant to the job. It was quite enough for these five managers to receive notification of the approval of a new document, which would not cause the slightest harm to the process. They were still sent a copy of the document because they would benefit from learning about the changes, but they were excluded from the decision-making process. Now the two remaining managers have time to study the form and resolve all issues in less than a week, after which the process can continue further.

Visual management

The abundance of visual management tools that lean manufacturing uses is due to the benefits of visually representing work in progress, costs, and employee competencies. These tools allow you to:

• identify and clearly present work priorities;
• visualize daily process performance indicators (“was the day successful or not?”);
• create favorable conditions for communication in the work area, as well as between management and staff;
• provide feedback to team members, supervisors and managers and enable all employees to contribute to continuous improvement.

Rice. 8. Tact board for registering orders

At its simplest level, visual management may involve posting process maps (showing how a process should be carried out) or a list of metrics on a notice board so that everyone in the work area can see how well or not the process is performing. Rice. Figure 8 shows a special type of visual management tool called a takt board (takt is the German word for metronome). Such boards are used to maintain the desired rhythm or pace of the process. The board reflects the desired indicators of the “rhythm of production” (taking into account client requirements and work-in-process volume limits) and indicators of the actual speed at which process participants work. The team that developed this board has determined the WIP limit and is using it to keep the number of tickets in the process at 48. Next we will talk about other visual management tools.

Examples of application of lean production tools in the service sector

Several years ago, Lockheed Martin's Systems Integration Division concentrated much of its procurement work at the Mid-Atlantic Region's Materials Acquisition Center (MAC-MAR). This center serves 14 regions with different addresses (“MAC-MAR clients”). Many of these regional sites were acquired during defense industry mergers in the 1990s and run a variety of legacy computer systems.

Each supplier of the center is responsible for the supply of a certain list of products. Suppliers connect to the computer system of the corresponding site, process purchase requirements and only then move on to work with another site. This connection and disconnection presented a problem. Because different sites used different computer systems, it took an average supplier 20 minutes to switch from one customer to another. In lean manufacturing language, this situation is called long changeover times. However, at that time - before the advent of the LM21 program - no one in the supply chain was trained in lean manufacturing, and therefore did not call or perceive this activity as changeover time and did not think about how this affects the process as a whole.

It wasn't just the long physical switching times from one computer system to another that hampered MAC-MAR's suppliers. There was also a “learning curve” that was also a problem: the lack of uniformity in systems meant that suppliers had to constantly switch from one instruction to another, trying to remember 14 different designations for one part, etc. d.

How would you act in such a situation? The suppliers worked like this: first they processed all requests from one site and only then moved on to the next. On average, it took them a full day to process one customer's requests before they could move on to the next area. If productivity was considered as the number of orders placed per hour, it was quite high, but if we take into account the priority of these orders, the suppliers placed orders incorrectly most of the time. And when there is an excess of work in process in the system, you can be sure that Little's Law will lead to a very long lead time.

Rice. Figure 9 shows how orders were processed before the process improvements. Having connected to one of the sites, suppliers tried to process all requests coming from there - both urgent ones and those that could wait.

Rice. 9. Fragment of the program interface that was used before

Due to non-standard computer systems, Lockheed Martin supply center employees were unable to work in multiple areas at the same time. It took them 20 minutes to switch to the next section. It is quite understandable that, having connected to one of the sites, they sought to immediately process all orders before moving on to the next client.

Features of the lean manufacturing philosophy

The lean process is characterized by:

• process efficiency more than 20%;
• a fixed limit on the volume of work in progress, allowing you to control the speed;
• using a “pull” system, in which new work enters processing only when the corresponding output work is transferred to the next operation;
• Using visual displays of information to manage and monitor a process (for example, showing the status of various products or services in a process or listing additional ideas for reducing lead times).

The problem was that this process completely ignored the timing required by other customers: an urgent order for section D had to wait until the supplier processed all the orders for sections A, B and C. As a result, the supplier took 14 or more days of so-called time turnover time for the client (customer turnover time) in order to go through the full cycle of processing applications from all clients. This led to long lead times, delays in billing for critical projects, and the need for overtime in production (Figure 10).

Rice. 10. Lack of flexibility in the procurement process

Because switching from one site to another was an extremely complex and time-consuming process for Lockheed Martin's buyers, the standard procedure was to process all orders from one site—urgent and non-urgent—before moving on to the next, as shown in Figure. 10. It is easy to calculate that when processing data from 14 sites, 14 days or more often passed before the supplier was ready to accept the next batch of orders from the site.

Moreover, the same product, such as an Intel Pentium processor, could be ordered 14 times under 14 different internal designations (each order could be 1/14 of the total quantity), increasing per-item costs and increasing overall time waiting and delivery times 14 times.

The value stream map showed that most of the delays in the procurement process as a whole were caused by the "changeover" problem, which represented the main hidden time loss. It was clear that if this problem was not solved, other improvements would be useless. These findings were confirmed by the “voice of the customer”: the most important point for customer sites was speeding up the execution of supply orders and reducing supply costs.

The MAC-MAR team mapped the process, determined the amount of work in progress at each stage, identified the longest delays, determined the complexity and realized that the solution to this problem had two components:

• a program should be developed that will be compatible with the computer systems of all areas and will be able to group orders according to types of products, displaying the consolidated data together (this will eliminate delays due to constant readjustment when connecting to different systems);
• The structure of the program should allow suppliers to sort orders by delivery time and type of product.

The result is shown in Fig. 11. Instead of information on one site, now only urgent orders from all sites are brought together here. By clicking on the appropriate product name, you can obtain information on purchase requests and view their history. Further changes included expanding the range of products that can be supplied under contracts, allowing buyers to place an order with a single keystroke (rather than having to reconfigure the system for individual orders), and many other improvements.

Rice. eleven. Interface view after transformations

At first glance, the information on the screen is almost no different from what was originally presented (Fig. 9). However, the ability to sort orders received from all sites in order of delivery priority means that it is now possible to combine information received from different sites using different programs.

Overcoming the challenges of dealing with different programs has increased the flexibility of the procurement process.

• Changeover time has been reduced from 20 minutes to almost zero.
• The batch size is now 1 order because the supplier does not have to switch from one site to another when placing orders.
• Cycle times that used to exceed 14 days are now less than 1 day (if the supplier starts at site A, he can process all rush orders and return to site A on the same day).
• Work in progress: Customers were accustomed to waiting in line for up to 14 days; the average wait was 7 days or 56 hours. Now the maximum wait time is 2 hours, and the average is 1 hour.
• Productivity has increased - instead of serving one customer in an 8-hour workday, orders from 14 customers are now processed every 2 hours (equivalent to 56 customers per day).

Who is comfortable with this kind of work - you or the client?

The MAC-MAR Working Group made other changes to the process (including expanding the list of pre-negotiated conditions). In general, all these changes made it possible to reduce supply prices by 50%, lead times decreased by 67% for consumer goods (from 6 to 2 months), thanks to on-time deliveries, enterprise productivity increased by almost 20%, and average unit costs for materials decreased by 6.4%. This example illustrates another key discovery of lean manufacturing: the speed of any process is proportional to its flexibility. Lockheed Martin's original process was very inflexible (customer turnaround time was 21 days); When the process of switching between clients was significantly simplified, suppliers were able to significantly speed up the process.

Changeover time and batch processing when providing services

Many people don’t realize that when providing services there is also changeover time. After all, if the transition from servicing one customer to servicing another takes you a certain period of time or you need time to achieve normal productivity, we are talking about changeover time. If you are postponing servicing a client (internal or external) because it is more convenient for you to continue with the work at hand, then it is more convenient to process in batches. Chapter 11 explains how to eliminate these sources of process delays.

Why can't Lean Manufacturing work without Six Sigma?

Lean manufacturing is highly effective at optimizing lead time and eliminating non-value-added costs, but there are still a number of serious issues that are not addressed by even the most advanced lean manufacturing literature. Six Sigma helps solve these problems and is why it is a necessary complement to lean manufacturing.

1. Lean does not prescribe the culture and infrastructure needed to produce sustainable results.

Much of the Lean literature does not address the infrastructure needed to successfully implement Lean projects and not only achieve speed but also maintain it. In fact, many companies that implement lean manufacturing are forced to develop a Six Sigma-like infrastructure, but instead of immediately adopting a traditional Six Sigma structure, they do so only under pressure. Companies that only apply Lean manufacturing are often unable to implement it throughout the organization and achieve sustainable results because they do not have a clear Six Sigma organizational infrastructure. Such an infrastructure ensures the involvement of senior management in the process, allows for training, strengthening the allocation of resources, etc. In its absence, the success of lean manufacturing depends only on personal initiative. I have seen successful lean manufacturing programs deteriorate when management changes. In this regard, Six Sigma is less vulnerable (though it is not completely immune to such problems): it assumes that the interests of shareholders must be protected first and foremost. Every Six Sigma book goes into detail about sustainable infrastructure, but no Lean book addresses this issue.

2. Lack of focus on critical features from a consumer perspective

Requiring the identification of process components that add value, lean manufacturing includes some elements of customer focus, but its approach is introspective. The value stream mapper makes a decision based on whether a given activity adds value or not. In contrast, Six Sigma determines when to include “voice of the customer” and “voice of supplier” in the improvement process. The most important indicator of this method is the characteristics critical to the client, the means for taking into account the “voice of the client” are provided at the “Definition” stage of the DMAIC cycle (Definition - Measurement - Analysis - Improvement - Control). In other words, Lean lacks the customer focus that permeates Six Sigma work.

In my experience, most people in the financial services industry have an interest in Six Sigma, but believe that lean methods are more appropriate in a manufacturing environment. However, after experiencing lean manufacturing firsthand, they change their attitude, seeing that these methods are faster and easier. Implementing Six Sigma tools requires a lot of effort.
Daryl Green, Senior Vice President, Bank One

3. Lean manufacturing does not recognize the impact of variances.

Lean manufacturing does not have the tools to reduce variances and provide statistical process control. Six Sigma considers the elimination of variance to be a key factor and offers a wide arsenal of tools for dealing with variance (from statistical process control to experimental design). As discussed above, 10% defects can increase lead time by 38% and increase work-in-process inventory by 53%. In other words, the speed and cost savings achieved through lean manufacturing can be negated by increased variance!

An increase in the percentage of defects is not the only source of deviations that lead to an increase in work in progress and lead time.

“Who needs lean manufacturing? I don’t have changeover time!”

Most service providers believe that there is no changeover time in their business. They associate it with dead zones during the transition from the production of one type of product to another in production. However, there is typically a learning curve involved in switching from one task to another before productivity reaches its peak, as we saw with Lockheed Martin's MAC-MAR supply center. This learning curve is shown in Fig. 12.

Rice. 12. Learning curve costs and performance

The employee remains locked into each task for 20 minutes, even though current customer demand requires that task to be completed within 5 minutes. This is similar to the situation at Lockheed Martin, where a procurement officer was tied to one customer all day and had 14 “tasks” assigned to him, corresponding to the number of sites (tasks A through N). In this case, the total order time increases fourfold. Using lean manufacturing methods can significantly reduce the learning curve.

The bottom line: Anything that reduces productivity levels will lead to longer lead times because people remain tied to similar tasks for longer than current customer demand dictates. Using lean manufacturing tools can significantly reduce lead times and minimize the impact of activity changes on productivity. One of the main sources of the learning curve is complexity, that is, the variety of tasks performed. The greater the number of different tasks, the less frequently they are repeated, the steeper the learning curve. Therefore, by reducing complexity, Lean Six Sigma addresses the learning curve problem.

Deviations in demand and time spent on operations to create products have a significant impact on order fulfillment time, while lean manufacturing does not imply a direct impact on these factors. This connection is illustrated in Fig. 13, which depicts the results of one of the stages of the above-described procurement process at Lockheed Martin.

Rice. 13. Impact of deviations on waiting time

Let's imagine that Bob spends an average of 16 minutes on a given task. However, due to variability in 68% of cases (one standard deviation), the total time could deviate from the average by 8 minutes, in which case the deviation factor would be 8/16 = 50%. Now suppose that Bob's employment has a similar deviation. As you can tell from the figure, if Bob is at 90% of his capacity, the job he is doing will wait in line for an average of 60 minutes, which explains about half of the time in line. If Bob encounters a particularly difficult problem, this time could increase to 100 minutes.

The deviation has a negligible impact on processes that operate with a large margin of throughput (left side of the graph). But most service organizations operate almost at capacity, and it is in this case that deviations have the maximum impact on the length of time a job (or consumer) waits “in line.” Processes that involve direct contact with the consumer are often subject to high demand variances because we cannot control the actions of the consumer who chooses the timing of contact at his own discretion. What is the conclusion? The higher the input deviations, the greater the capacity reserve should be provided. If the variances are small or we can control demand in some way (which is more likely in the case of internal processes), we can work with increased load without the risk of significant delays. When I first presented this analysis to Lockheed Martin, Manny Zulueta, vice president of Lockheed Martin's MAC-MAR supply center, said, “This confirms our observations!”

The impact of demand deviations on waiting times is greater the higher the percentage of existing capacity utilized by the process (as can be seen from the steep slope of the curve on the right). The more significant the deviations, the stronger the impact.

Lean Manufacturing also needs DMAIC

Most descriptions of lean manufacturing begin solving a problem at the Improve stage, bypassing the Define and Measure stages. Because the Define stage identifies the scope of the problem, and the Measure stage aims to quantify it and relate it to resources, people often bite into a portion of Lean that they cannot chew, or get lost in the shuffle. various improvements.

Why does Six Sigma need Lean Manufacturing?

There are certain gaps in Six Sigma, just like in Lean manufacturing methods. Let's take a look at what Six Sigma's shortcomings Lean Manufacturing helps fill.

The general idea is this: as the practice of many companies has shown, the use of Six Sigma can achieve a lot. But there is one difficulty. Whatever tool you choose, if it doesn't have a lean component, if you don't focus on increasing speed and reducing work-in-process, all your gains will eventually come to naught. The process will remain slow and labor-intensive, and the costs will be prohibitive. There are five reasons why Six Sigma needs Lean.

1. Identification of losses. Although process mapping is a Six Sigma tool, it does not collect the data (including changeover time, unit processing time, transportation, etc.) needed to quantify process steps and identify activities that do not add value and increase the costs of the service/product. Lean manufacturing has a powerful tool in its arsenal - a value stream map, which overcomes barriers between functional departments and allows you to identify waste and delays. Six Sigma rarely looks at different activities from a value-adding perspective and does little to eliminate non-value-adding activities. First of all, the Six Sigma protocol prescribes the elimination of deviations, and only if this is not possible, design according to the Six Sigma criterion (DFSS) is carried out. Lean manufacturing is based on the premise that process redesign (to eliminate non-value-adding activities) is necessary to some degree in all cases below 10%.

2. Increasing process speed and cycle time. Optimizing cycle time and responsiveness is often considered an outcome of Six Sigma. However, Six Sigma experts do not link quality and speed, either practically or theoretically, nor do they set a limit on the amount of work in process required in a pull system (this operation is needed to make lead time a controllable parameter with limited variance). The volume of work in progress is the most important factor in cycle time (according to Little's law). If you don't limit work in process to a maximum limit, cycle time reduction will remain a dream.

Losing a client

One of the most significant losses that lean manufacturing does not take into account is the loss of a customer. You are missing out on customer-related revenue, and the cost of acquiring a new customer is typically significantly higher than selling the same amount of services or products to an existing customer. In fact, all the losses that lean manufacturing explicitly identifies are internal to the process, not external. It can be proven that eliminating these internal losses significantly reduces the likelihood of losing an external customer because you deliver services quickly, without waste, and at minimal cost. However, you can waste a lot of time and effort on providing a service that the customer doesn't want, and so Six Sigma takes a more constructive approach to incorporating the "voice of the customer" and defines customer loss as a defect.

3. Speed ​​tools. Six Sigma tools rarely include lean manufacturing tools such as total plant maintenance (TPM), time-based value sharing, 5S, etc. These extremely effective speed tools have been developed and refined over decades of practical application. Of course, adapting them to the service industry requires some effort, but neglecting them will not achieve maximum process productivity.

4. Methods for obtaining quick results (kaizen process, DMAIC). Lean manufacturing has a kaizen method for rapid improvement. It represents short-term, intensive projects, when a group of people with relevant knowledge, over the course of four-five days, purposefully and systematically improves a selected process or type of activity. The effectiveness of such events is extremely high; the need to quickly achieve tangible results gives a powerful impetus to creative thinking. As you will learn in this book, kaizen plays a prominent role in service delivery, although the method often requires some modification. Having an operational improvement method in your arsenal provides a great catalyst for DMAIC projects. Lean's focus on action allows for faster results.

5. Six Sigma quality is achieved much more quickly after non-value-added steps are eliminated using lean manufacturing methods. The Six Sigma Research Institute has compiled a table (Figure 14) that examines the cumulative impact of defects on actual throughput. For example, consider an invoicing process that includes 20 transactions, each of which is performed at level 4a (99.379% yield). The total real throughput will be (0.99379) 20 = 88%, which is quite typical for service delivery processes. Such a low yield creates problems with accounts receivable and necessitates the need to “knock out” money and re-process.

Rice. 14. Real Bandwidth

This table clearly shows that it is very difficult to achieve high quality in processes with a large number of operations, and, conversely, low quality has a much stronger impact on a complex process. The most effective way to achieve Six Sigma quality levels is to simultaneously improve quality and apply lean manufacturing principles to eliminate non-value-adding process steps.

Using lean manufacturing tools allows you to quickly (in a few weeks at most) eliminate non-value-adding activities, most likely at least half of them (10). Thus, instead of 20 processing stages, invoices now go through only 10. It is clear that even without additional quality improvement measures, a process involving 10 stages has a much lower probability of errors than a process with 20 stages.

The actual throughput increases to (0.99379) 10 = 94%. Higher yield will increase the return on your improvement investment, and more importantly, the speed of the process will double, allowing you to not only deliver your services to the client faster, but also increase the rate of return on quality tools by doubling their effectiveness.

By combining Lean and Six Sigma, you can not only reduce the number of activities, but also improve the quality level of the remaining activities to, say, 5a, which will increase the actual throughput to (0.99976)10 = 99.8%.

A Challenging Challenge for Six Sigma Proponents

Sometimes the question arises: is it better to start with process optimization using Six Sigma (without eliminating non-value-adding steps) or to first eliminate non-value-adding steps using Lean methods and only then start optimizing the process using Six Sigma. Some Six Sigma proponents believe that lean manufacturing techniques (such as the pull system) should be applied once the process has become controlled and optimized. However, this point of view is easily challenged: “Would using lean manufacturing and a pull system, which allow you to control speed and reduce cycle time, harm the implementation of Six Sigma?” In fact, using both Lean and Six Sigma tools together will have the most beneficial impact on a company's culture. Projects should be selected based on their impact on increasing ROIC, not on whether a set of tools is required to solve the problem - one that offers Lean manufacturing or one that uses Six Sigma.

Merging Lean and Six Sigma to Improve Services

It is known that the Lean Six Sigma method is a powerful means of implementing the strategy of top management and a tactical tool that allows managers of independent departments to achieve annual and quarterly targets. If management stays away from the Lean Six Sigma program, the company will likely have to lose out to competitors where managers have added these techniques to their arsenal.

The merging of the basic principles of lean manufacturing and Six Sigma allows us to formulate five “laws” that determine the directions of improvement work. Below are the first four (we started numbering them from 0, since this law is the basis for the rest).

0. The law of the market. Issues critical to quality from the customer's perspective are the top priority for improvement, followed by return on invested capital (ROIC) and net present value (NPV). We call this law the Zero Law because it is the foundation for the others.

1. The law of flexibility. The speed of any process is proportional to the flexibility of that process (see Figure 10).

2. Law of focusing. 80% of delays in any process are accounted for by 20% of all operations.

3. Law of speed. The speed of any process is inversely proportional to the volume of work in progress (or the number of “objects” in the work). Little's Law states that the number of objects in a process increases due to long changeover times, rework times, demand and supply variances, time and complexity of the product offered.

4. Law of complexity and costs. Typically, the complexity of a service or product offering increases non-value-added work and work-in-process by a greater amount than does low quality (low sigma) or low speed (no lean).

History of success. New Lockheed Martin traditions

Lockheed Martin was formed by the merger of Lockheed and Martin-Marietta (one of a number of mergers) in 1995, so technically the company is about seven years old. But ask the people who work here and they'll tell you the company feels even younger, because as recently as two years ago most employees were closely tied to their former organizations, and Lockheed Martin was more of a diverse group of 18 corporations than unified education.

Two years ago, the LM21 - Operational Excellence program was born, based on the Lean Six Sigma method. According to Mike Joyce, vice president of LM21, this method became a consolidating beginning for the company, which helped employees learn to work together for a common goal. Below is how they managed to achieve this.

Business idea

Lockheed Martin's success is largely determined by inventions, major scientific and technological achievements and quality of execution. This explains why so much of the improvement work is in service delivery: development, procurement, design, lifecycle support, hiring, customer invoicing, legal, etc. Supply is also a service that comes first plan, since about 50-60% of the costs of each type of product come from procurement or subcontracting.

As Joyce says, “We would never have dreamed of equipping new fighter jets with 1975-style radars, but we still found it perfectly acceptable to have 1975 business processes in our supply chain. We not only need to develop a new radar, we must thoroughly work out the process of creating this radar.”

The government awarded Lockheed Martin a contract to do what the company defines as “software engineering”—developing custom software solutions to meet a customer's specific needs. The company says: “Scientific and technological achievements and innovative solutions are part of our daily work.” It’s no wonder that 50 thousand of Lockheed Martin’s 125 thousand employees are scientists and engineers.

The issue of tradition at Lockheed Martin was a very important factor. Lockheed Martin has incorporated former divisions from a variety of companies, including General Dynamics, GE, IBM, Goodyear, Westinghouse, Loral and Ford, each with its own legacy. Combining 18 different companies meant 18 different computer systems, 18 different part numbering systems, 18 different sourcing approaches, 18 different ways of writing specifications, hiring employees, paying bills.

Moreover, each company had its own background in the struggle to improve quality: quality circles, statistical process control (SPC), continuous flow manufacturing, Six Sigma, TQM, lean manufacturing. Therefore, Lockheed Martin's improvement strategies needed to enable people to take pride in and continue their company's traditions while also ensuring teamwork worked well.

Movement towards this goal began in 1998, when Lockheed Martin management realized that the new enterprise had enormous resources of quality and craftsmanship. They rolled out a program called LM21 - Best Practices to make their accumulated knowledge and experience available throughout the company.

Mike Joyce, vice president of the LM21 program (Lockheed Martin's operational excellence program), and Manny Zulueta, vice president of the Material Acquisition Center - Mid Atlantic Region (MAC-MAR) helped us become familiar with Lockheed Martin's application of Lean Six Sigma. ), James Isaac, Director of Supply Chain Excellence, Northern Material Acquisition Center, and Miles Burke, Certified Black Belt and Supply Chain Improvement Manager.

Lockheed Martin has 125,000 employees worldwide in four core areas: aeronautics, space systems, systems integration and services technologies.

While sharing best practices was a good start, it had its drawbacks:

• What is "best"? In the current business environment, the pace of change is accelerating. By focusing on best practices, you may lose sight of waste and opportunities to improve the enterprise as a whole;
• people can become complacent. Lockheed Martin strives to ensure that every employee feels a sense of urgency to continually improve and never feels like they have achieved perfection. “Best” is a transitory concept;
• the “best practices” system was too flexible. At first, factories and other departments decided for themselves which best practices they wanted to use. "But when Lockheed Martin makes something, it has to mean something in terms of quality standards," Joyce says. - We cannot allow our departments to refuse to improve quality by saying, for example, that they are interested in advanced business development methods. Quality and speed are a must for everyone.”

The LM21 program covered all departments of the enterprise, it applied to all types of work and was aimed at increasing productivity and efficiency.
Manny Zulueta, Vice President of Material Acquisition Center

So after two years, the LM21 program's priorities shifted from a focus on best practices to superior performance, with the primary goal of delivering lean processes with Six Sigma quality.

“This covers the entire Lockheed Martin operating system,” says Joyce, “everything we do from customer billing and purchasing to product development and hiring people.” The new LM21 approach is based on Lean Six Sigma principles: all work is scrutinized, value-adding activities and waste are identified, eliminated, and remaining activities are improved. More importantly, LM21 is not perceived as something external or external to the organization's activities. “It's a strategy that helps managers achieve ambitious annual goals and establish processes that enable sustainable results over the long term,” says Joyce. “It’s everyone’s job to do their job and improve the way they do it.”

Preparation and Deployment

Integral to Lockheed Martin's LM21 program deployment are critical Six Sigma infrastructure components. Among them:

1. Undoubted and clear support from senior management and its participation in the program

Lockheed Martin CEO Vance Coffman has been vocal about his support for the LM21.

2. Senior management is trained in Lean Six Sigma concepts and their application.

Coffman and his entire executive committee completed four and a half days of training (two and a half days of classroom training and two days of hands-on training to fine-tune the process). This course included:

• Lockheed Martin's 5 Principles of Excellence (see box);
• a half-day session on “defining value from the customer's perspective,” including a roundtable with customers who gave their opinions on whether Lockheed Martin is a good deal to do business with;
• study of value streams and process flows, including simulation modeling for systems development;
• practice of structured problem solving.

Lockheed Martin's Five Principles of Excellence

Mike Joyce says it was important for Lockheed Martin to define the principles of excellence early on because they were the criteria for choosing how to do the job. These principles include elements of both Lean Manufacturing and Six Sigma.

1. Understand what is valuable from the customer's point of view. The client values ​​you not only for what you give him, but also determines whether he is comfortable doing business with you. Everyone must understand what is valuable to their client. Getting this right is the first step because it allows you to classify any work as either value-add or waste. If you make a mistake in understanding the value, then all subsequent work will be a loss!
2. Understand what “value streams” are. The manager must thoroughly know in which departments of the organization the product or service is being created. There is no room for guesswork here: you must write it down, documenting each step, and be prepared to answer questions like: “When was the last time we saw this? Where are the data from these observations?
3. Deeply understand the work flow. Engineers often talk about the "top of the requirements pyramid" - the most important need that a product or service must satisfy, and it is this need that dominates everything else. When achieving excellence, the top of the pyramid of requirements is to design systems that optimize the flow of data and the flow of molecules. If you don't optimize flow, you won't achieve optimal efficiency.
4. Prioritize cycle time and “pull.” The goal is to reduce turnaround time to an absolute minimum so that you can respond instantly to changing customer needs.
5. Strive for perfection. For Lockheed Martin, this means Six Sigma quality at Lean speed.

Leadership training has two other important aspects:

• At first, many members of Vance Coffman's team were less than enthusiastic when they learned that they would have to block out four and a half days of training in their schedule. At one meeting, Mike Joyce asked them, “How many of you have been trained in this way of thinking?” Of the 20 people, only two raised their hands (one was familiar with Six Sigma, the other with Lean Manufacturing). Joyce then said that if this team was going to lead the company's implementation of Lean Six Sigma, they had to know what it was about. After completing the training course, management representatives unanimously stated that it was the best training in their entire career. As Joyce himself said: “We did not intend to make them black belts or radically change the process in two days. But we hoped to provide an impetus that would help them take action in the right direction and support the LM21 program";
• Lockheed Martin's senior leadership team was trained in Lean Six Sigma within their departments rather than in isolation. The question arose: “Why?” As Joyce responded: “Ultimately, the LM21 program needs to involve everyone in the company. So instead of training all of you together, I want you to train together with your staff in a work environment. Let everyone see that management intends to implement this program.”

3. Management at all levels have received basic training

When the senior management team completed the training, all Lockheed Martin employees who were included in the compensation system were required to take the basic course. In this organization, this applied to everyone who held a director or higher position. This five-day lean training was organized across departments and conducted in groups of 50 until all 5,000 managers had completed it. (The program has now expanded to include clients and supplier executives, who are taught ways to achieve results quickly.)

4. Implementation began with value stream mapping

From a strategic perspective, Lockheed Martin's starting point was to map the value stream at the program level because it is at this level that cross-functional flow optimization occurs (a program is a set of processes that is used to provide a specific customer with a product or service). A value stream map reflects the current state of affairs, that is, it shows what is happening in the workplace. Value stream maps provide an opportunity to evaluate operations based on the principles of excellence: are you creating value in the customer's mind? What are your omissions? What can you do to overcome them?

5. They continue to build stable infrastructure

All employees are involved in improvement projects and undergo just-in-time training. LM21 projects rely on an internal workforce that includes Black Belts, Green Belts, sponsors and what Lockheed Martin calls Subject Matter Experts (SMEs).

• The primary responsibility for identifying and selecting projects lies with line management (e.g., department managers), who often act as project sponsors. Usually they are the owners of the process, that is, they are responsible for maintaining and improving the process.
• Subject Matter Experts are a group of 20 experienced professionals who report directly to Mike Joyce. In this sense, they are similar to Six Sigma champions in other organizations, but at Lockheed Martin they play a much more important role. These 20 professionals come from various functional areas: business operations, cash management, supply chain management, production management, development, human resources, customer relations, logistics management, software management, etc. Their main focus is Understand everything related to LM21 in a short timeframe and facilitate the rollout of the program at each site and in each functional unit. Their job is to act as process catalysts across Lockheed Martin's 36 locations and ensure that work in those locations follows corporate methodology and meets established standards.
• Lockheed Martin has set a goal of training 1% of its employees to become certified Black Belts (certified means they have completed several weeks of training, completed a number of projects, and are mentoring Green Belts). helping the sponsor and administration of LM21).
• Anyone can take the 40-hour course to become a green belt. All that is required of a Green Belt is that after training, he must lead a team working on a project that will achieve cost savings. To date, 43 of the 160 employees of the systems integration group at the Material Acquisition Center have completed such training, 32 of them have certificates.

6. Their methods are a fusion of lean manufacturing and six sigma.

The LM curriculum and improvement methods are a combination of the basic tools and principles of Lean and Six Sigma, such as the DMAIC methodology, identifying the seven types of waste (a Lean manufacturing tool), process mapping, working on cycle time reduction, etc.

7. At the first opportunity, they took on suppliers.

“Like most manufacturers, we have always placed great emphasis on controlling incoming materials to ensure they meet our specifications and engineering documents,” said Manny Zulueta, vice president of Lockheed Martin's Material Acquisition Center. “Then we did five or six programs where we worked with major suppliers to implement Lean Six Sigma in their plants to make them better suppliers... And we got the materials coming in to be almost flawless. Now, when we receive material, we just need to make sure it arrived in the right quantity, do a quick check of its condition, and then we can send it to the warehouse.”

Supplier collaborations range from Lean Six Sigma training conducted by Lockheed Martin personnel to symposiums where suppliers can share experiences.

However, the possibilities for such cooperation are not unlimited. With thousands of suppliers, Lockheed Martin cannot do this type of work with everyone. “We identified a set of criteria that allow us to determine how important a particular supplier is for us, weighed the pros and cons, and assessed them using a system of quantitative indicators,” explains Dzulueta. - We took into account the following factors: how successfully suppliers fulfill our requirements, whether they have technologies that are important to us, to what extent their work affects the quality of products, etc. We compiled a list of approximately 200 main suppliers with whom we all want to work "

“The secret to collaborating with suppliers,” says Dzulueta, “is a close relationship with the management of the supplier company. Everything works out if we manage to attract the participation of senior management, because we believe that they must be involved in transforming processes. Typically, such work with the supplier takes several months. We cannot do this without the support of senior management. If the company president, CEO or general manager is not interested in it, it will most likely end in failure.”

Lean Six Sigma experience helps advance

James Isaac is an example of how the LM21 program is being used to develop leadership. He is currently Director of Supply Chain Excellence at MAC-MAR, a position he assumed in the spring of 2002. Prior to this, he worked for two years as a “subject matter expert.” “We received very thorough training,” says Isaac. “Along with this, we received personal training in management skills, participating in successful projects and improving productivity.”

Before Isaac was appointed to his current position, he was only tangentially involved in supply chain management. “Before I became a specialist, I worked with Lockheed Martin for 18 years as a systems engineer,” he says. - It was very interesting to look at the design from the point of view of a supplier. Now I look at what is happening with the developments that I was previously involved in myself with completely different eyes.”

results

Today, the LM21 program brings together more than 5,000 projects, more than 1,000 of which are carried out in the field of business operations (management, financial management, deal closure, procurement, etc.). The initial goal was to reduce costs by $3.7 billion over four years - in reality, the savings are closer to $4 billion. As Mike Joyce noted, in an organization the size of Lockheed Martin, it is difficult to argue that all this is a result of LM21, but The attention paid to excellence is undoubtedly one of the most important factors. Other business indicators are also improving: the company has a record number of orders; liabilities have decreased significantly compared to levels at the time of the merger; The annual cash flow is in the billions. These changes, many of them in the services sector, have allowed Lockheed Martin to create a next-generation cruise missile with the same capabilities as other products, but at half the cost and one-third the cycle time. All Lean indicators at the departmental and individual project levels have improved significantly. Handoffs have been significantly reduced in many processes, resulting in shorter cycle times and greater customer satisfaction.

Similar results are visible in the non-core manufacturing activities of Lockheed Martin. Comparable acceleration and cost savings were achieved by Naval Electronics and Surveillance Systems, a group that provides products and services to combat fleets around the world, including advanced shipborne electronic warfare systems coupled with communications systems. These results also impacted Lockheed Martin's ability to secure new orders. For example, the company was recently selected as one of the prime contractors for Deepwater, the most ambitious program of the US Maritime Border Protection ever.

Billions of dollars have been allocated for this program to rebuild the Navy's infrastructure, and Lockheed Martin will lead its implementation. As the company embarks on a 20-year program, the company is making extensive use of Lean Six Sigma tools to define customer value and identify critical customer requirements, leveraging Six Sigma design and developing close relationships with new suppliers. .

Grow your business

According to Mike Joyce, it is important that management does not equate “eliminating waste” with “firing people.”

“The goal of LM21 is not to fire people once we've eliminated waste, but to improve our operations and provide people with value-adding jobs without wasting their energy,” he says. “By eliminating waste, we can offer the client a better deal, which will allow us to grow our business.”

Like any company, Lockheed Martin acknowledges that it cannot guarantee lifetime employment for employees. But work under the LM21 program expands the company's ability to obtain new large contracts. Employees who participate in LM21 training and projects gain skills that enable them to better serve customers, increasing their chances of long-term employment with the company. “The client provides us with work,” says Joyce, “so the ultimate goal for everyone is stable employment.”

Difficult tasks

Imagine how hard it is to get 125,000 people to think and work differently, and you'll appreciate the work Lockheed Martin has done. The company has set itself the task of 60% of employees (about 70 thousand people) by 2004 either completing a week-long training course to obtain a “green belt” or taking part in a week-long project. Meanwhile, the company is actively engaged in compiling value stream maps for all implemented programs (their number is 2000). Among other tasks:

• increased demands on program managers.
  Until now, most program managers have been asked to do one thing - to provide the client with what is stipulated by the contract: “Here are the costs, and here is the work schedule. Ensure timely delivery." Now they are told that this is not enough: they must not only meet cost commitments and stay on schedule, but also be concerned with improving the way they operate the program they are responsible for. "It's like changing the rules in the middle of the game," says Mike Joyce. “We want to make sure they have the knowledge and tools to keep up with the increased demands.”
• synchronization of the work of all departments of the enterprise.
  Let's say Lockheed Martin focused solely on streamlining its manufacturing operations and made them the epitome of lean manufacturing: fast, efficient, just-in-time, without unnecessary investment in inventory. However, all this work will go down the drain if planning staff continue to process orders in batches, or if supply has not corrected shortages and suppliers have not provided the required quality or improved design. These types of problems can affect any organization that does not take a systematic approach to making sure the pieces of the puzzle fit together. Keeping track of all of these points helps companies avoid the classic state of constant failures that limit the ROI of Lean Six Sigma investments;
• Convincing people that they can't do without Lean Six Sigma.
  Your attempt to bring Six Sigma, and especially Lean Manufacturing, to the service industry will likely be met with one of two responses (and Lockheed Martin is well aware of both). First: “This doesn’t suit us... This has nothing to do with software. legal services. to (fill in yourself).” Second: “You see, we already tried this. We did this ten years ago. This is of no use." To these objections, Mike Joyce responds: “Okay, let's watch your process and find out what's really going on.” He invites people to go through the entire process that a document goes through, observe what happens, and collect data on the current state of affairs. People are invariably amazed by their discoveries. and begin to realize that they have plenty of opportunities to improve quality, speed and reduce costs!

These data are valid for a normal distribution. It should be taken into account that not every process is characterized by a normal distribution. More information about statistical process control: Wheeler D., Chambers D. Statistical process control. Business optimization using Shewhart control cards. M.: Alpina Business Books, Alpina Publishers, 2009. Approx. scientific ed.

Learn more about lean manufacturing terms: Illustrated glossary of lean manufacturing/Ed. C. Marchwinski, D. Szuka. - M.: Alpina Business Books, 2005. Note. scientific ed.

More about value stream maps: M. Rother, D. Shook. Learn to see business processes. Practice of constructing value stream maps. - M.: Alpina Business Books, 2005. Note. scientific ed.

It should be borne in mind that D. Womack and D. Jones, who “formalized” Japanese “lean manufacturing” for Americans in the early 1990s, start with value for the consumer as one of the central ideas of the entire concept of lean manufacturing. Note scientific ed.

Extremely popular among the Japanese (and, primarily, at Toyota), control charts - the main tool for reducing variability - arose long before the concept of Six Sigma. Accordingly, it is difficult to agree with the author that lean manufacturing (Toyota production system) does not have such tools. In general, no improvement in quality is possible without reducing variation. Note scientific ed.

Developed based on the works of James Womack, author of such books as The Machine that Changed the World and Lean Thinking (there is a Russian translation: D. Womack, D. Jones. Lean manufacturing: How to get rid of losses and achieve prosperity for your company. - M. : Alpina Business Books, 2005). Note scientific ed.

The synthesis of two proven and popular methods of management and optimal adjustment of the production process, which complement each other, is called Lean Six Sigma.

The goal of integrating the concepts was to create a system with a synergistic effect that could be used in any enterprise, regardless of field of activity and size.

The Six Sigma concept made up for some of the shortcomings of the Lean Manufacturing concept and vice versa.

The experience of using a complex synthesized process was first described in 2001, and 2 years later several books were published with a detailed discussion of the theory and practice of Lean Six Sigma. As a result, it became clear that the concepts conditionally “divided” the entire procedural diversity among themselves: “Lean” showed what needs to be done, and Six Sigma showed how to organize activities for this.

In what ways do the concepts complement each other?

The concept of “Lean Manufacturing”, having changed the production culture, over time expanded the tools, included the ideas of the value stream, a method of protecting against errors, and was transformed into “Lean Management” (Lean).

By the end of the 20th century, both of these concepts (Lean and Six Sigma) were the most popular areas of business consulting in quality management, since the number of successful implementations in relation to the total number of implementations was higher than that of other quality management methods. Together they demonstrated even greater efficiency.

How Six Sigma Complements Lean:

1. Lean does not set requirements for the infrastructure needed to implement the concept. The solution to this issue depends on the initiative of managers and their organizational abilities, and when the composition of managers changes, difficulties arise with the transition. Six Sigma helps formalize the commitments of the top management of an enterprise, formulate a plan for allocating resources and monitoring the success of their development.
2. The Lean concept is not as strict as Six Sigma, but focuses on consumer needs. Satisfaction of requests from the elimination of production costs and non-production losses depends indirectly, while in Six Sigma the description of the principles of the DMAIC concept begins with the definition of consumer requirements: Define, Measure, Analyze, Improve, Control (Russian: Determine. Measure. Analyze. Improve. Manage).
3. Defects, within the Lean concept, are identified as the main sources of production losses, but statistical control methods for eliminating them are prescribed in Six Sigma.

How Lean complements Six Sigma:

1. Six Sigma describes methods for eliminating defects, but in addition to defects, Lean Management also names the factors of waiting, transportation, overproduction, inventory, movement of people, and non-value-adding activities. Sometimes practitioners also highlight the use of low-quality raw materials (“false economy”) and diversity, as a consequence of non-unified components of the process.
2. Six Sigma does not explain the relationship between customer satisfaction (quality) and process time. Thanks to the Lean system, the concept of “time” is introduced as a key one.
3. Lean expands the range of tasks that Six Sigma describes by adding the elimination of unproductive activities, optimization of the workplace, reduction of inventories, reduction of transportation costs, etc.

At the same time, both basic systems are characterized by an orientation towards a single process (in contrast to the concepts that precede them, which attempt to achieve universal coverage). The synthesized concept also retained this originality.

Application of Lean Six Sigma in Industries

Both basic systems that created the synergistic concept of Lean Six Sigma are “living” systems. Having undergone repeated “testing” in production and non-production areas, the concepts have become universal - applicable with equal success in various industries. Using the example of logistics, we can show the application of the Lean Manufacturing + Six Sigma complex in the service sector.

Order lead time, according to Little's formula, is equal to the volume of work in progress divided by the average speed of work (the amount of work performed by one employee per period of time). To reduce order fulfillment time, the synthesis of Lean Manufacturing and 6 Sigma systems in logistics is focused on optimization in 3 main areas:

1. The logistics process is a slow process, which makes it costly. (More than 50% of slow processes are associated with non-value-added losses).
2. The speed of logistics services is reduced due to a significant share of work in progress. As a result, about 90% of the time the work is considered unfinished, which reduces consumer satisfaction.
3. The direction is based on the Pareto principle, characteristic of slow processes: 80% of costs result from 20% of actions. By identifying and reducing this 20%, on-time performance increases to 99%.

Another specificity of logistics is that it accounts for about a third of sales volume. Calculations show that 10% of defects in logistics increase order fulfillment time by 38% and the volume of work in progress by 53%. A significant portion of the costs relates to return logistics. Depending on the initiator of the return, the reason may be:

• dissatisfaction of end consumers implementing the money-back guarantee,
• problems with installation and use (with subsequent return of defects),
• repair work associated with multiple shipments of goods in both directions,
• expiration date and environmental safety, etc.

For example, in the US online trade, the return of electronics and high-tech products, according to various estimates, reaches 50-80%. This increases the number of problems for the industry, which was initially created and configured for direct movement, without large-scale reverse flow, and which was not ready for return bookkeeping, disposal of goods, etc.

From the above, it follows that the return flow should be configured as carefully as the forward flow, while simultaneously reducing the number of non-value-added operations. This could be helped, for example, by computer programs that would be compatible with the information systems of all departments and would allow the creation of group orders, sorting them by delivery dates, types of products, priorities, etc. The general tasks remain the same, as well as in product production - reducing input variability, reducing the number of switching between tasks, standardizing the platform within the cycle while maintaining an assortment that meets the customer’s needs, etc.

Logistics represents a common application of Lean and Six Sigma concepts in the service industry, but illustrates the general application of the system.

Lean Six Sigma effectiveness in numbers

The implementation of Lean Six Sigma is reflected both in economic growth and in improving the atmosphere within the team, which ultimately also affects the economy - a culture of well-coordinated teamwork, rapid exchange of information and specific knowledge arises. As a result, the implementation of the integrated concept:

• speeds up processes by 20-70%;
• improves the quality of services and products by 20-40%;
• increases overall efficiency by 10-30% (compared to the separate implementation of one of the basic systems).

Often the implementation of a concept encounters greater difficulties than expected. The “human factor” comes into play, internal contradictions arise in the requirements, the statistical process becomes an end in itself, and not a method for detecting defects.

Among the common mistakes they mention is being overloaded with the tasks assigned to oneself, when, for example, there are 100 technical transformations for 100 identified customer needs. But this, at first glance, “lifting” volume involves planning and regulating about 10 thousand relationships, which significantly complicates implementation. In such cases, it is advised not to transform everything at once, but to focus on the needs that are critical for the client, selected using a list of priorities.

Lean in the Perform methodology is a comprehensive system aimed at increasing customer satisfaction and team efficiency.

The main benefits for the company are increased efficiency and competitiveness

• Increased efficiency by 20% (on average), incl. due to productivity
• Improving the quality of services provided and increasing customer satisfaction
• Strengthening teamwork, increasing initiative and involvement of staff
• Personnel development and professional growth
• Additional increase in business efficiency by 5-6% annually

Whiteboard meetings promote focused discussion of employee workload and continuous improvement.

Vision boards serve as “dashboards” that reflect the effectiveness of the team’s work, incl. qualitative and quantitative KPIs

Key building blocks of a vision board:

• Individual and team performance
• Problems and Ideas
• News
• Command section

Meeting at the board– a focused discussion that creates a single information space for interactive discussion of work results and opportunities to improve efficiency

• Conducted by the team on a regular basis
• All team members actively participate in the meeting, rotation of moderators is observed
• Duration – from 15 to 30 minutes
• Motivates and energizes the team

Kaizen session– a tool for structured solving complex cross-functional problems and generating ideas – structured brainstorming aimed at developing solutions to existing problems, as well as identifying new hidden problems. Characterized by a strict sequence of actions and a wide range of tools used, the progress of the session is controlled by the facilitator.

LEAN Production Concept

The concept of LEAN Production (“lean production”) was formed at Toyota in the 1950s. In the sixties, Toyota triumphantly burst into the car market: Japanese cars turned out to be both better and cheaper than American ones. Then other industries became interested in the LEAN concept: energy and trade, services and healthcare, the army, and later in IT.

The essence of LEAN is to do everything possible to truly understand the client’s requirements and gradually remove all unnecessary things that do not bring value to him. That is, do this:

Lean IT (lean IT)

Lean IT (lean IT) is a business concept that, when applied to the work of the IT department, inherited a strict Lean approach (the concept of managing the production cycle of an enterprise, based on the constant desire to eliminate all types of losses). Its goal is to do more work with less cost, but only if the benefits obtained from Lean IT are as good as before. However, if the benefits of implementing lean development practices are obvious, then why are IT departments so overwhelmed by them that they do not even respond to requests from business units to implement digital processes?

The problem is expectations. The fact is that after implementing Lean IT, the management of IT departments wants to see immediate results, they literally fixate on this, endowing the methodology with miraculous capabilities. As a result, the team responsible for implementing Lean IT begins to rush, and this begins to affect quality: processes end up being carelessly automated or outsourced to third-party managed service providers without proper quality control. Many IT departments do not pay enough attention to training IT staff, so automated processes often break down either at the company itself or at the outsourcer. So, instead of collaborating with business departments, IT staff have to periodically tweak “automated” processes, leaving them little time to work on truly important projects like digital transformation.

How to approach Lean IT from the right angle?

The first thing to keep in mind is that the IT team should not rush into implementing Lean IT, otherwise it will lead to technological failures. First, you need to create an appropriate nomenclature of technological services with an inventory of the implementation scheme for each of them. Here's what it should have:

• a detailed scheme for putting the service into operation, what is needed to support it at the initial stage and at the end of the life cycle;
• a list of technical personnel involved and their management roles;
• requirements for service providers;
• life cycle planning, quality control;
• relationship with other departments.

It should also be borne in mind that, unlike the Lean methodology in production, which is aimed at reducing all types of costs, Lean IT in the software field must adapt to the speed of technology development and the variability of business needs. This is the key difference between Lean IT and Lean in manufacturing - the latter is much more static in nature, so major changes in it can be planned in advance. When counting on the implementation of Lean IT, it is worth taking into account the influence of external factors and, in particular, breakthrough digital technologies - all this requires giving business processes a digital look and this work must be carried out by the IT department.

Thus, successful implementation of Lean IT requires confident adaptability to changing business processes - even a minor change in business strategy requires IT specialists to quickly make changes or add new technology. To be able to respond to these changes, IT needs to resort to Dynamic Buffer Management (DBM) - this is another development from Industrial Lean, but in IT it will help manage the services that IT departments need to manage or manage. create. IT teams always have the resources and best practices to optimize workflows, it's just about being realistic about the current pace of digital innovation.

6 Sigma Concept

The 6 Sigma concept was developed by Motorola in the 1980s to reduce variation in electronic component manufacturing processes. The name of the project is based on the Greek letter “sigma”, which denotes the statistical concept of standard deviation.

In conditions of an unstable and changing economic situation, management methods, including production, aimed at overcoming crisis phenomena and increasing the efficiency of enterprises using internal resources, are attracting more and more attention. Among the advanced approaches aimed at improving the performance of any enterprise, the concept of “Lean Manufacturing” (or Lean system) stands out. The introduction of the principles of a Lean system allows you to bring any company to a qualitatively higher level: it helps to find ways to optimize business processes by eliminating losses and ineffective operations at all stages of the production process, and to identify sources for further growth.

Lean Six Sigma- an integrated concept that combines the most popular quality management concepts in the 90s of the last century: the concept “ Lean manufacturing, focused on eliminating waste and overhead, and the Six Sigma concept, aimed at reducing process variability and stabilizing product performance.

The Lean Six Sigma model is a combination of two approaches popular abroad. The central theme of the Lean concept is value for the consumer. Its founder was the Japanese corporation Toyota, where lean manufacturing methods were formed in the middle of the last century. Within the Lean model, all activities are classified into value-adding or neutral operations and processes. The first group develops, the second is considered as losses and is eliminated. Popular Lean solutions are, for example, 5S (five simple steps to creating a quality work environment to increase productivity), Kanban (a just-in-time system, that is, with minimal inventory), Kaizen (aiming at constant improvement at each stage of value creation), TPM (total equipment care).

The Lean Six Sigma concept has a wide scope and can be used by any enterprise, regardless of size and field of activity.

The period of formation of the concepts of “Six Sigma” and “Lean Manufacturing” dates back to the mid-80s of the last century. At that time, the production sector set the highest demands on product quality and resource savings. The Lean Manufacturing concept was created as a cost optimization methodology in the automotive industry. The Six Sigma concept owes its birth to a program to combat defects in finished products by reducing process variability in semiconductor production. It is only natural that manufacturing companies have been the pioneers in the application of these concepts. The stages of development of the concepts of “Six Sigma” and “Lean Manufacturing” repeat the stages of development of standards for quality management systems (QMS). The ancestors of the most used QMS standards ISO 9000 series were standards containing quality assurance requirements for the military industry, and later for the automotive and mechanical engineering industries.

Six Sigma is a process optimization methodology based on mathematical models. It was formed at Motorola, but it became widely known after being adapted for General Electric. The name comes from the statistical concept of standard deviation, denoted by the Greek letter σ - sigma. The maturity of the production process is assessed by calculating the yield of defect-free products. The lower the indicator, the more stable the production. It is believed that the highest level of Six Sigma produces no more than 3.4 defects per million operations.

For some time, the Lean concept and the Six Sigma methodology, developing in parallel, competed with each other, finding their supporters and opponents. Many companies use a comprehensive version of Lean Six Sigma. After all, an integrated solution allows you to obtain an economic effect both by reducing losses and by building stable and controlled processes.

The beginning of the 90s of the last century can be characterized as a time of active use of management system standards and the concepts of Six Sigma and Lean Manufacturing in non-traditional areas. Increasing competition pushed producers of services and intellectual products, government and public organizations to search for new ways to maintain and increase demand. From the consultants' point of view, the prospects for adapting quality management standards and concepts to the needs of enterprises in these areas were extremely broad. For example, the service sector currently produces 80% of the gross national product. Having undergone repeated testing at enterprises in both production and non-production spheres, the concepts of “Six Sigma” and “Lean Manufacturing” have gained universality. As a result, the name “Lean manufacturing” - “Lean production” - was transformed into “Lean” - “Lean management”. By the mid-90s, the concepts of Six Sigma and Lean Management became one of the most popular areas of the consulting business in quality management.

The ratio of the “number of successful implementations” to the “total number of implementations” is higher compared to other methods and concepts of quality management. In addition to the subjective factors of success due to the efforts of training centers and consulting firms, there are also a number of objective factors. In relation to the Six Sigma concept, the most significant success factor stands out - high organization. High organization is one of the most distinctive features of American business, which is expressed in the following:

• all activities are carried out within the framework of projects, each of which has established goals, deadlines, budget, distribution of responsibilities and powers, requirements for identifying risks, maintaining records, etc.;
• requirements for the knowledge and skills of personnel involved in projects are clearly defined and classified into categories (“black belt”, “green belt”, etc.);
• The progress of each project is regularly monitored using an established system of measurable indicators - “metrics”.

There are several success factors for Six Sigma. The procedure for its implementation is formulated in the American Quality Engineer's Handbook as “identifying, selecting and executing projects.” The greatest attention is paid to the selection of projects, which must be justified both from the point of view of the greatest economic feasibility and from the point of view of the possibility of implementation in practice. It is interesting to note that a specialist who has a “black belt,” despite the hired nature of his work, has all the advantages of an external consultant, namely:

• he is independent and can make impartial assessments and judgments;
• he is not perceived by colleagues as “one of us”; his opinion is listened to as an expert in matters of quality improvement;
• The reputation and future career of a specialist in the “black belt” category is completely determined by the success of the projects he implements within the framework of the Six Sigma concept, which explains his high level of motivation.

Specialists with a “black belt” can be hired on a part-time or full-time basis. To evaluate the results of their activities, “lower and upper tolerance limits” are established - for a year of work, a specialist of this category, hired full-time, must bring savings to the enterprise from $500 thousand to $1 million. Going beyond the lower tolerance limit means a lack of qualifications, exceeding upper limit is unlikely. The concept of “Lean management”, first formed in Japanese enterprises, has other success factors. High organization is no longer a factor in achieving success, but the result obtained. The achieved high organization of processes (both main and auxiliary) allows the enterprise to save a significant amount of resources. In addition to the fact that the concept of “Lean Management” implies fundamentally new approaches to the culture of management and organization of an enterprise, it also offers a set of tools that make it possible to reduce the cost and speed up processes. The main tools are already well known to quality specialists: just in time, 5S, kaizen (the concept of continuous improvement), value stream management, poke-yoka (error-proofing method), etc. In this list, practitioners highlight “value stream management” as one of the most effective tools in achieving the goals of the “Lean Management” concept.

The Six Sigma concept, which has American roots, is similar to the Japanese concept of Lean Management due to the mutual interest in a particular process. This significantly distinguishes them from many “venerable predecessors” focused on universal coverage, and makes them similar to new generation concepts such as “business process reengineering.” The concepts of Six Sigma and Lean Management complement each other perfectly.

The Lean Management concept does not establish requirements for the form of implementation of the concept and the infrastructure required for this. Therefore, the success of Lean Management largely depends on the initiative and organizational abilities of managers, but when managers change, everything can collapse. Lean Management lacks formalized commitment from top management, formalized training, planned resource allocation, tracking success with corrective actions, etc.

The Lean Management concept is not sufficiently focused on consumer needs. Their satisfaction is not directly related to its main goal - eliminating losses and waste. In the Six Sigma concept, focus on customers is a key element. This is confirmed by the fact that all the main metrics of this concept are built on tracking the relationship of process parameters and product characteristics with the specifications set by consumers. The key principle of the Six Sigma DMAIC concept begins with defining customer requirements: Define, Measure, Analyze, Improve, Control.

In the Lean Management concept, defects and inconsistencies are recognized as one of the main sources of losses in an enterprise. At the same time, it does not discuss statistical process control methods for eliminating losses. The Lean Management concept is not focused on finding sources of process variability and ways to reduce variability, which is one of the main elements of the Six Sigma concept.

Defects - the main target of Six Sigma - are only one of many types of waste in enterprises. In the classical theory of the Lean Management concept, seven types of losses are identified: overproduction, waiting, transportation, non-value-adding activities, inventory, movement of people, production of defects. Many authors identify additional types of losses. For example, “false economy”, which consists in the use of cheap and low-quality raw materials and materials, “diversity” as a result of the use of non-standardized elements in processes.

The Six Sigma concept does not draw parallels between quality and customer satisfaction, on the one hand, and the duration and speed of processes, on the other. At the same time, the duration of the process is directly related to customer satisfaction in the provision of services, and for production processes - with frozen funds in the form of stocks on standby. In the Lean Management concept, the analysis of time as one of the main resources of the process is a key area.

The set of tools of the Six Sigma concept limits the possible range of problems to be solved. Process improvement within the Six Sigma methodology is carried out mainly by reducing process variability using statistical methods and process redesign using the DFSS (Design for Six Sigma) method. The Six Sigma methodology misses such opportunities for process improvement as reducing unproductive activities, reducing waiting time, reducing inventory and transportation costs, optimizing jobs, etc. All of these opportunities are fully realized by the Lean Management concept.

Filling the “gaps” described above within the framework of the integrated Lean Six Sigma concept is shown in the table

Key elements of the concept	Six Sigma concept	Lean management concept	Integrated Lean Six Sigma Concept
Formalized management commitments	√		√
Formalized resource allocation	√		√
Formalized training and distribution Responsibilities and powers	√		√
Gradation of specialists involved in projects	√		√
Implementation of the concept in the form of “definition, selection and Project Execution"	√		√
Short-term improvement projects - kaizen		√	√
Monitoring using metrics	√	√	√
Using the DMAIC principle in project execution	√		√
Using statistical methods to reduce Process Variability	√		√
Identifying and eliminating waste and unproductive Costs in process		√	√
Increasing the speed of the process		√	√
“Pull” principle of process functioning		√	√
Reducing costs caused by diversity		√	√
Elimination of losses resulting from “false Savings"		√	√

From this table it can be seen that in the Lean Six Sigma concept, the answers to the question “how to organize activities?” taken from the Six Sigma concept, and the question “what to do?” - mainly from the concept of “Lean Management”. At the same time, the Lean Six Sigma concept uses a combined set of measured indicators (metrics) and a combined set of methods and tools for implementing improvement. An example of the set of methods and tools used in Lean Six Sigma is given below.

D-define	M - measure	A - analyze	I - improve	S - manage
Kano analysis Process Mapping The financial analysis Prioritization	Control cards Pareto charts Histograms Process Cycle Performance Assessment Plan Data collection	Pareto charts Ishikawa (Fishbone) FMEA Diagrams Determination of overhead costs Identification of "time traps" Assessing Constraints	5S lot size rationale Hypothetical testing Selection Matrix Solutions	Control cards Visual control of the process Training plan Information plan Plan Standardization

The practice of using the Lean Six Sigma concept in Western enterprises allows you to achieve the following results on your own in a short time (about a year):

• reducing the cost of products and services by 30-60%;
• reduction in service provision time by up to 50%;
• reduction in the number of defective products by approximately 2 times;
• increase without additional costs the volume of work performed up to 20%;
• reduction in the cost of design work by 30-40%;
• reduction in project completion time by up to 70%.

A graphical comparison of the results of an enterprise’s activities using the integrated concept “Six Sigma” + “Lean Management” with the results of the concepts “Six Sigma” and “Lean Management” applied separately is shown in the figure.

There are two main signs that indicate the presence of avoidable losses in processes. The first sign is any changes occurring at the enterprise, for example, an increase or decrease in production volumes, expansion of the range, organizational changes, innovations, etc. The second sign is insufficient documentation of processes and misunderstanding of the essence of processes by employees involved in the process.

Before answering the question “will it work?”, it is worth considering an example when one of the seven simple quality tools did not “work” - the data stratification method. After a seminar at one of the consulting firms, a company specialist decided to analyze the accumulated data on defects.

Defects at the enterprise were identified using the following methods:

• acoustic emission method,
• ultrasonic control,
• eddy current method,
• magnetic particle, etc.

At the enterprise there was no classification of types of defects that could be associated with the causes of defects. The data array was stratified by defect detection methods and then data analysis was carried out for the entire period. This analysis did not produce any results; the nature of the data did not allow for any other analysis. As a result, statistical methods were forgotten, and the fight against defects resulted in increased fines.

To start improvement projects, you don’t need to perfectly know the entire set of Lean Six Sigma tools and metrics. The 20/80 principle also applies to the demand for knowledge of specialists in the “black belt” category. When implementing 80% of projects, less than 20% of the tools studied by these specialists are used. The complexity of applying the Lean Six Sigma concept lies in the simplicity of its individual elements. Most of the problems are related to improper data collection and preparation, as in the example described. There are several basic principles that accompany success, both in the application of simple statistical methods and in the implementation of the Lean Six Sigma concept:

• management interest;
• resource allocation;
• experience of successful projects.

When implementing the Lean Six Sigma concept, resources include paid staff time, costs for their training and the acquisition of funds necessary for the preparation and implementation of projects. Management must acquire the knowledge necessary to control and manage these activities. Calculation of the required training hours and working hours spent on project implementation can be found in any textbook on the Six Sigma concept. The project leader must have practical experience in successful improvement projects. As important as learning is, the experience of participating in one successful project is worth studying dozens of case studies.

,PDM

During the webinar “Fundamentals of 6 Sigma,” the recording of which is available to you via the link, I was asked the following (familiar) question: how does Six Sigma differ from Lean? In my practice, I try in every possible way to get around the methodological “contradictions” (contradictions in quotes!) between lean manufacturing and 6 sigma. I also never focus on tool differences. Although many tools are often attributed to one methodology or another. Instead, I always focus on a certain basis inherent in all the “fashionable” and already “obsolete” methodologies.

Logo from our groups In contact with and , illustrating the general beginning of the methodologies

What kind of basis is this? What is the general beginning? Isn't it common sense? And if so, then why look for differences in methodologies that are based on common sense?

Reflecting on these questions, I came to an interesting observation: for some reason, not everyone among the site visitors is interested in the differences in methodologies. After digging a little into my memory and mailbox, I was able to establish the following:

1. Most often, the question about the criteria for distinguishing Lean and Six Sigma is asked by employees of organizations that provide educational services (universities, consulting companies, etc.).
2. Less common, but by a very small margin, are young specialists - students, graduate students and “cadets” - newly hired foremen, engineers, managers.
3. And it’s very rare to come across questions from experienced production workers, project leaders and people who have been engaged in their profession for more than a year (or should I say, who have been increasing their efficiency for more than a year?).

As a typical production worker, I can assume that the value of dividing methodologies “by name” in my work simply will not add, and therefore the question of separation does not arise for me. I believe that it should be applied depending on the situation, and not on the name of the technique.

Fortunately, this time, in addition to such an unconvincing argument as one’s own opinion, there is an opportunity to refer to the article by Terence Barton - Is This a Six Sigma, Lean or Kaizen Project? , on the basis of which Victoria Oleshko’s material was prepared - Is this 6 Sigma, Lean or Kaizen project?

Have you already read the article? If not, then I advise you to do it right now, and only then continue to study this post... No. Seriously. article and come back.

Central to Mr. Barton's article is the following diagram:

An almost literal translation of the diagram is given below:

In his publication, Mr. Barton draws attention to the fact that lean manufacturing, six sigma, and kaizen are nothing more than “tool boxes.” The use of a particular tool should be determined by the situation, and not by the buzzword that sounded in the title of the last seminar attended. According to the author, leadership, creativity and innovation are the components of a breakthrough. They just encircle the above diagrams, creating the basis that I spoke about above.

Nevertheless, this is dedicated to those who like to look for differences:

In this diagram, our team tried to lay out the three methodologies in one coordinate system to make it easier to compare them and look for differences. But there are also disadvantages:

“But in the old scheme there were a lot of scary words “karate”,
“judo” and “taek-won-do” – it’s good to scare TOP people with it :-D” ©

The Six Sigma concept is aimed at measuring the degree to which business processes deviate from their goals and their further improvement on this basis aimed at satisfying consumers and increasing production profitability.

The Six Sigma concept was developed by Motorola in the 1980s as an approach to achieving high quality, which allowed her to receive the US National Prize in 1988. Malcolm Baldrige for his work in the area of ​​quality.

The Six Sigma concept is aimed at solving three main problems:

increasing customer satisfaction;

reduction of operating cycle time;

reduction in the number of defects.

The Six Sigma concept involves setting short-term enterprise goals aimed at further achieving long-term goals. Implementation of business processes at a certain level is considered as short-term goals, and improvement of business processes, focused on customer satisfaction and increasing production profitability, is considered as long-term goals.

The measurement indicator is the number of defects per unit (DPU) and the number of defects per million events (DPMO). The number of defects per unit of production is calculated by dividing the number of defects found in any particular process section under consideration by the number of units passed through that section. The number of defects per million events is obtained by multiplying DPU by million and then dividing this product by the average number of defective events. For any operation or at any step in the process, the number of defects can be determined (for example, failure to respond to a customer request within a certain period of time, an error in fulfilling a customer order, an incorrect invoice, etc.).

You can also identify defects in the process chain associated with internal and external customers. This indicator is used in relation to the assessment and change of various objects: manufactured products, operation of equipment, software, implementation of design processes, production, management, etc.

Thus, The sigma value shows how often a defect can occur. The higher the sigma, the less likely it is that a defect will occur.

For example, if a carpet covering a room with an area of ​​100 m2 is cleaned to a three sigma level, then 0.25 m2 of carpet will not be cleaned, if up to six sigma, a surface the size of a pinhead will be uncleaned.

Four Sigma in the US would mean 500 incorrect surgeries per week. Source: Pande P., Holp L. What is Six Sigma? Revolutionary method of quality management / Transl. from English M., 2004.

In table 6.6.1 presents the “Sigma scale”, which establishes the dependence of costs on low quality and the level of competitiveness of the enterprise depending on the number of sigma.

Table 8.6.1

"Sigma scale"

Sigma number	Defects per million (DPM0)	Costs of poor quality (% of sales)	Note
			World class
			Average in industry
			Uncompetitive

A high level of defectiveness, and therefore the sigma number, leads to the loss of consumers, product sales volumes and profits.

Implementation of the Six Sigma concept at an enterprise involves certain staffing. The list of individuals who can be called Six Sigma agents is as follows: “champions and sponsors”, “master black belts”, “black belts”, “green belts”, “yellow belts”.

"Champions and Sponsors". "Champion" - This is one of the senior managers who knows the Six Sigma ideology and actively strives for its successful implementation (for example, the executive vice president of the company). In addition, the role of “champions” can be informal leaders who apply Six Sigma methods in their daily activities and disseminate their experience in this area. Sponsors - These are the process owners who help implement the Six Sigma concept and coordinate related activities within their responsibilities.

"Master Black Belt" - These are individuals with the highest technical and organizational skills who provide technical leadership to Six Sigma programs. They must understand what certain statistical methods are based on and be able to correctly apply these methods in non-standard situations. In addition, Master Black Belts mentor Black and Green Belts in statistical methods.

"Black Belts" - These are individuals who have completed training and training under a special program and devote 50 to 100% of their time to working on Six Sigma projects.

"Green Belts" - These are the leaders of specific projects who lead their respective teams. Unlike black belts, they receive a shorter training program and spend only a small portion of their time on Six Sigma projects.

"Yellow Belts" - These are often temporary workers who have received induction training and can participate in teams led by black and green belts.

The approximate order of numbers for some of the above groups is as follows. For a company with 1000 employees, it is desirable to have: “master black belt” - 1, “black belts” - 10, “Six Sigma projects” - 50-70 per year (5-7 projects per “black belt” per year).

Using the “sigma” scale, you can create a “profitability breakthrough” program, which involves increasing production profitability.

An example of using the concept in practice “Canceling the construction of a new plant”

One pharmaceutical company was very successful in selling its painkiller and decided to double its production by investing $200 million in building a new plant.

When this project began, several Six Sigma participants decided to implement several improvements to increase production in an existing plant.

After collecting data, they found that only 40% of packaged drugs could be used. This was due to an unsatisfactory method of sealing the ampoules (some of them were not completely sealed, others were not included in the box).

Improvements in the technology of this process and corresponding experiments were carried out. To do this, several parts were purchased for $50 to regulate the equipment for sealing ampoules, which increased the yield of the finished product to 85%.

The corresponding increase in production volume more than doubled made the construction of a new plant unnecessary.