Expert Panel

Focus on these things to succeed in Purchasing and Supply Chain

Bringing Back the Romance: Lean Six Sigma Principles


By Julie Brignac, President, QuantumSix Solutions, Inc.

I am a CNBC fanatic.  I started watching it religiously when I exited the executive ranks of the corporate world and launched my own business from home.  My primary motivation for increasing their ratings was to learn more about how and why I had lost so much money in the latest drama of the world financial markets.  I found it ironic that I have spent a career saving companies millions of dollars by deploying Lean Six Sigma methodology, but had quickly realized I was not as smart as I thought where my own money was concerned.  I needed to take control of how my money was being put to work.


That’s what companies need to do in today’s economic environment – take control of how their money is being put to work.  Most companies would argue that they are doing just that – slicing headcount, restricting or eliminating bonuses, cutting operational costs.  CNBC has been a great venue for watching companies slice and dice their way to profitability through massive cost cutting.  They are the first to tell you that most companies turning a profit these days did it through major cost initiatives - not through revenue growth.


Cost Cutting at its Best?

So, you may ask – what’s wrong with that?  Cost cutting is all well and good to survive, but as I have watched the events unfold over the last several months, I am amazed at the approach – or more accurately, the lack thereof -  that companies are using to drive costs down.  Slice and dice is not a sustainable approach.  But it’s what companies do in a panic to survive, not thinking of the longer term effects or impact on its processes.  Let’s face it – the slice and dice approach is a killer of efficient processes, but it gets the job done – for now. 


But think of the consequences.  What happened to using Lean Six Sigma to cut costs, improve processes and sustain those improvements?  Why aren't companies turning to their highly trained Blackbelts and Lean Experts to lead the charge?  Where’s the romance with Six Sigma that made Motorola, General Electric and AlliedSignal synonymous with world class?  


I have a theory why the romance died – and how we can get it back.


Remember When We First Started Dating…..

Don’t get me wrong – I’m not saying that no one is using Lean Six Sigma or some form of Business Process Management.  That’s not true – there are many companies using the methodology very successfully.   What I am pointing out is that so many companies are not turning to their experienced Lean Six Sigma resources to drive the change needed to move them out of this challenging economic era.  In fact, many of these resources have recently been handed their pink slips.  Many companies are ushering this extraordinary talent out the door.


I believe there is a primary reason why most have abandoned it as a key strategic element:

  • It worked when they launched it – and now it doesn't;


  • They are tired of it.


We all live in a fast paced business world.  We love searching for that new culture-cost saving magic potion that will transform our organization.  Let’s face it – we have been drinking the Lean Six Sigma magic potion for a couple decades now, and it’s starting to taste bland.


What happened?  My theory is that companies forget to teach their employees why they are learning Lean Six Sigma. The typical approach focuses on teaching people how to use the Lean Six Sigma tools – the mechanics - but then people don’t know what to do with them.  This happens when companies launch their Lean Six Sigma training with a higher level of learning – say at a Greenbelt level – that is heavy with statistics and theories that most employees simply don’t care about.  Employees leave the training, sludge through their projects, get certified and check the box.  


Whew – glad that’s over, they say.  We saved money on our project – hooray!  But I never want to see another Gauge R&R again.


What good is it to learn tools if you don’t know how to apply them in your everyday tasks?  I encountered a perfect example of this when talking to a company executive the other day.  He said their company had trained 10 employees at a greenbelt level over a year ago, and the projects were going nowhere.  As a result, the board was not impressed that Lean Six Sigma was something that would work in their company.  But he knows the power of the methodology from previous job experiences, and he knows it would transform what they do. 


So what happened?  Perhaps they didn't set any vision for their employees on why they were learning Lean Six Sigma – they just taught them how to use the tools.  Without some connection to the business strategy, the methodology just flounders in the mass of daily tasks and responsibilities without purpose or success.


Lean Six Sigma needs a vision and an infrastructure.  It’s more than training, projects and certification.  Unfortunately, the perception of most is the latter (just check the box), and most think by some miraculous process, if you train, do projects and certify, then a company magically transforms itself. 


Lean Six Sigma can transform, but you have to develop your own recipe for success, and stop thinking about Lean Six Sigma as a magic potion.


State of the Union

I just attended a forum where many executives gathered to discuss how their companies were handling the economic downturn.  The day was full of fascinating discussion, with most of them venting their frustrations on how they are forced to operate on a quarter by quarter basis just to make the numbers.  They were all concerned about how short term actions would impact their company longer term.


One of the speakers at the forum made a very powerful statement: 

“Investors are now looking for companies who are taking actions that will sustain them in the longer term.”

Really?  That is completely contrary of what most executives at the forum said was their reality. 

Ladies and gentlemen – we have a gap we must close, and we can close it with Lean Six Sigma.


Refreshingly, I met one gentleman whose company’s approach was different.  Let’s call them Company X.  They are still spending their capital budget because it is the right thing to do for their future and their customers.  They are still paying their suppliers per the contractual payments terms and not extending them to 90 or 120 days.  They are cutting costs and managing through the impact from the recession – but they are doing it by evaluating their processes and using Lean Six Sigma tools to drive costs down, while improving their processes and strengthening themselves for the economic turnaround.  Their leadership has a vision of driving world class quality.


Now that’s a stimulating way to run a business.  Everyone should follow their example.


How can your company do it?  First, rally your leadership around the excitement of accomplishing two things with one effort:  drive costs out and streamline every process in the house.  Make it every employee’s mantra to make their job easier.  Corral those lean experts, greenbelts and blackbelts in a room and emphasize the importance of their role in driving the company towards sustainability.  And, if you don’t have trained resources – get someone with proven deployment experience to help you setup the infrastructure.  If you have unutilized trained resources – get someone with proven Lean Six Sigma leadership experience to help you turn things around. 


Bring Back the Romance

My argument for keeping Lean Six Sigma at the forefront of your business strategy is simple:  it provides objectivity so that decisions can be made with data.  It focuses on process improvement that drives efficiency.  Efficiency saves money.  It arms your company with resources who have acquired an amazing skill set that never goes stale if applied appropriately.


I think the key to Lean Six Sigma success is how it is applied in the workplace.  I have a view that Lean Six Sigma tools are applicable for certain types of problems, but their application needs to be wrapped around a larger strategy of driving world class quality.


For example, think of the end in mind:  world class quality in everything you do.  It starts with arming your employees with the best organizational skills possible.  My view is that this starts with understanding good project and change management skills.  First, teach your employees two things: basic project management (technical skills) and effective change management techniques (soft skills).  Then, teach them about DMAIC, DFSS and Kaizen events.  By taking this approach, you have taught your employees valuable foundational skills that can be applied in any situation – you have taught them not only how to use the skills, but more importantly, why they are using the skills.


If employees operate with the basics of project and change management, now they can learn more advanced skills to better analyze situations with data.  Teach them where Lean tools work best and where Six Sigma tools work best.  And, don’t forget to teach them that sometimes Lean Six Sigma tools are overkill for a problem- simple project and change management tools sometimes suffice when the solution to a problem is already known. 


By approaching improvement learning in this manner, you have taught your employees that there is a solution to every problem, and several different ways to improve everything that they do.  You have given them options so they can do their job better.  You have also established a tone in your company that process improvement drives world class quality, and Lean Six Sigma tools are just that – tools to help facilitate the journey.


How to Sustain the Marriage

Perhaps companies have moved away from actively driving Lean Six Sigma methodology because they believe it takes too long: too long to implement – too long to achieve results.  My argument is if you approach it as a part of your strategy and tailor it to meet your company’s specific needs – that is, assess your company’s maturity level in understanding quality as a key strategic element – you will achieve the proper balance between driving short term results without long term negative consequences.  Remember the example cited earlier about Company X?  Company X is one of the most profitable companies in the world, and they didn't slice and dice their way to get there.

If you approach using Lean Six Sigma as a part of an overall quality strategy, you should remember these key elements to sustain the improvements:

  1. Don’t drive improvements on a project basis only.
  2. First and foremost, hire someone with business acumen and strategic agility to lead your quality effort.  Lean Six Sigma technical skills are important, but not the priority.
  3. Don’t assume your company understands quality and continuous improvement better than they really do.


Projects can be great, but people get tired of them.  Design the cost savings initiatives around making your employee’s everyday duties easier and more productive.  Lean Six Sigma should train everyone to think this way without solely focusing on the tools.  Reward your employees when they succeed in driving productivity.  This approach is putting a company’s money to work better than before.


We Should Call It Something Else

Maybe the answer is to rebrand Lean Six Sigma.  There are too many definitions and perceptions out there about what it does and whether it lasts or not.  But those of us who have deployed it and used it successfully know that it is one method that will always work because of its objectivity and data driven methodology. 


Using Lean Six Sigma puts a company’s money to work, and executives should get excited about that.  There are so many great experts in the field these days, and companies have the pick of the litter to drive their program effectively.  Just remember to fold it into a larger strategy of driving world class quality, and don’t get hung up on the tools themselves. 


It’s great stuff - we just need to get rid of the old opinions and perceptions that have occurred over time.  Maybe we should rebrand it QuantumSix.  I wonder what CNBC would say about that.


Written by Julie Brignac,
Purchasing & Supply Chain Expert for ManagingAmericans.com, President, QuantumSix Solutions, Inc.


How would you describe your company’s sourcing function?