Dr. W. Edwards Deming was an effective yet obscure statistician who became famous and highly respected by virtue of his pioneering work in quality management that ultimately evolved into what we now call Lean Six Sigma.
After WWII, Deming helped Japanese automobile manufacturers dramatically improve the quality of their automobiles and, at the same time, lower their production costs. The U.S. “big three” auto manufacturing CEOs were said by Deming to have ignored his overtures to learn about his quality disciplines, but the CEOs of Toyota, Honda and others in Japan welcomed his ideas.
The rest is history.
To Ford’s credit, they ultimately applied these principles with their program they extensively advertised as “Quality is Job One!”
Deming’s fame catapulted once NBC televised a one-hour documentary “If Japan Can … Why Can’t We?” The answer was, of course, “we” didn’t understand quality management and, as a consequence, domestic car sales suffered severely while Japan’s car sales exploded.
I recall attending our Kern Economic Conference at CSUB several years ago and chatting with a U.S. Air Force general from Edwards Air Force Base. I asked him how he viewed the effectiveness of their Lean Six Sigma program. He wisely responded, “It’s not a program with us — it’s inherent in our culture!”
So what is Lean Six Sigma?
Six Sigma is recognized as a widely accepted and practiced organizational discipline because systems are continuously improved, costs are consistently lowered and defects are eliminated by this data-driven discipline.
One LSS standard is that a process should produce no more than 3.4 defects per million opportunities. Another way to say this is “the goal is to reduce variation” in all systems and processes.
This raises an additional critical point. We have long spoken in terms of “policies and procedures.” This is appropriate in a legal context. However, in management practices, it’s critical to speak and think in terms of “systems and processes.” Each system is composed of one or more (usually more) processes. Each process has an input and an output. Whoever receives the output is a “customer” — internal or external.
Lean is an entirely separate (yet compatible) discipline. Its primary purpose is to eliminate waste. Lean also works to maximize value from the customer’s perspective while, at the same time, uses as few resources as possible.
Although many larger organizations have factored LSS into their corporate cultures, smaller business owners also can be every bit as successful.
LSS also works in the public sector. The county of Kern is totally committed to this discipline under the astute leadership of CAO Ryan Alsop. The county’s results can be viewed at http://launchkern.com. Literally millions of taxpayer dollars have been saved, as have thousands of work hours! (Bakersfield’s new city manager should do no less!)
How to implement LSS in your organization requires an understanding of the all-important, proper use of data as well as the effective use of LSS tools. The major tool is a process called DMAIC, an acronym for:
Define the project.
Measure the current situation.
Analyze to identify root causes.
Improve by identifying solutions.
Control by monitoring and sustaining each solution.
Other tools include process maps, brainstorming, bar and pie charts, Pareto chart, balanced scorecard and any others you find helpful. Not all tools are needed at any one time to help you lower costs, save employee hours and other benefits of Lean Six Sigma, of which high morale is one.
Counsel is available from those certified as Black Belts or Master Black Belts, or you can do it all on your own. CSUB has offered classes in the past. Many are available online.
Every business owner in Kern County should seriously consider LSS as an ongoing part of their organizational culture.
As we recover from COVID-19 and take a fresh look at all our operations as business owners and managers, this is an ideal time to initiate Lean Six Sigma.
John Pryor, CPCU, ARM is a management consultant for CSUB’s Small Business Development Center. He has written articles on management locally and nationally, including a series on Dr. Deming’s 14 points as applied to the insurance industry for the International Risk Management Institute in Dallas. IRMI also published his book, “Quality Risk Management Fieldbook,” which couples the principles and disciplines of quality management with those of risk management.