Define Lean Six Sigma

Use Lean Six Sigma to reduce inventory, reduce product defects and increase profits.

Lean Six Sigma represents the combination of the Lean Manufacturing business management methodology and the Six Sigma business management methodology. The end result is referred to as Lean Six Sigma. Each of these methodologies are extremely valuable independently. So, the two combined allow companies to significantly increase profits and shareholder value by reducing inventory overhead and reducing product defects simultaneously.

Lean Manufacturing

Lean manufacturing is a business management process which seeks the highest level of production with minimum inventory overhead. Having inventory on hand is wasteful and can dramatically affect the bottom line. So, lean manufacturing methodology employs processes designed to keep inventory to a minimum. One well-known management philosophy supporting lean manufacturing is Just-In-Time (JIT). JIT manufacturing is where companies maximize the use of information technology and supply chain management to deliver inventory "just-in-time" to be used in the manufacturing process.

Six Sigma

Six Sigma is a business management methodology where companies use mathematical and statistical processes to increase profits by identifying and eliminating manufacturing defects. Defects undermine creditability, brand loyalty and customer retention. So, by identifying and eliminating defects, it improves corporate profits and shareholder value. According to Motorola, the Six sigma methodology originated with Bill Smith, a Motorola quality manager, in 1986. It started out as a process applicable only to the manufacturing industry. However, over the years, Six Sigma processes have evolved and are now deployed in many sectors.

Lean Six Sigma (LSS)

According to SixSigmaTutorial.com, Lean Six Sigma is the combination of Lean Manufacturing methodology and Six Sigma. When these two methodologies are combined, it results in a methodology that reduces wasteful inventories while simultaneously reducing product defects.

Advantages of LSS

The Lean Six Sigma process saves companies millions. The savings come from lower override due to less inventory stockpiles, less space due to less inventory overhead, a lean workforce and the customer service cost savings resulting from higher customer loyalty. Lean Six Sigma also empowers workers because, in an effort to reduce defects, Six Sigma processes must empower assembly line workers who are closest to the production line.

Implementing LSS

Lean Six Sigma is a well-established methodology with a smorgasbord of tutorials on the principles and processes involved. Corporate leaders who are not familiar with the processes should start with a tutorial called "New to Lean Six Sigma" to establish foundational knowledge of the principles and processes.

References

• Motorola University: The Inventors of Six Sigma
• Six Sigma Tutorial: Definition Of Six Sigma, Lean Six Sigma Concepts

Resources

• I Six Sigma: New to Lean Six Sigma