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Lean Six Sigma management

Introduction to Lean Six Sigma
--- Continuous improvement of process and performance

Background of Lean Six Sigma

Since 1980s, the reform and opening up policy leads to rapid development of Chinese enterprises. Depending on low labor cost, single market demand and less competition from like products, an enterprise can realize rapid development by only expanding its scale. 

However, after entered the new century, the golden development period is completed. Enterprises of all industries face various problems, such as the excess production capacity caused by repeated construction, gradually deteriorated competitive environment arising out of excess capacity, compression of profit margin due to rise of labor and material costs, more and more fastidious consumers spoiled by a wide variety of commodities, increased costs arising from high defect rate, the impact of increased inventory on cash flow, energy and manpower waste out of idle equipment, the effect of production bottleneck on on-time delivery, etc.

It’s clear that more advanced management methods and ideas are needed to solve above problems. The Lean Six Sigma brings in a new thinking and method and provides a road of sustainable and scientific development to Chinese enterprises.  

What is Lean Six Sigma?

Lean production changed the outlook of Japanese enterprises and pushed Japanese manufacturing industry to the top level of global enterprises, while Six Sigma helped GE to create the miracle of rapid development in the end of 1990s when most Global 500 companies declined in fierce market competition.

Lean Six Sigma is the combination of Lean Production and Six Sigma Management, and its essence is to eliminate waste and lower the cost. By the idea of Six Sigma and the tool of Lean Production, Lean Six Sigma helps enterprises to enhance the operating efficiency, improve the process and achieve the rapid response to market demand. 
 

What problems can Lean Six Sigma solve? 
Solve problems existing in traditional quality control of products 
 
 精益六西格玛解决什么问题?解决传统的产品的质量控制存在的问题

 

 

Firefighting, focusing on the remedy after quality defect occurs  
Problems existing in traditional quality control
 

Take final yield as the standard to evaluate the quality of products, ignoring the control of intermediate process and plenty of rework
Mass production, failing to respond to changes in the market flexibly and ensure the on-time delivery of multi-varieties and small batch.  Lack of the boundless cooperation among departments, failing to find out the source of problems objectively on the macro level, low efficiency, etc.


Why is traditional quality control method not applicable any more?

For traditional enterprises, the selling price equals the cost plus the profit, therefore set the price at the premise of ensuring the profit;

For enterprises today, the profit equals the selling price minus the cost, therefore the cost shall be decreased to ensure the profit;




   Lean Six Sigma believes that: there is a hidden gold mine within every enterprise, while the profit is just like the water in a sponge, if you squeeze, you will have always get some. Remember not to let waste costs all your profit!
 

Lean Six Sigma can help enterprises to:

 

精益六西格玛可以帮助企业 
 

Lean Six Sigma Reduce the variation of business process, increase the capacity and stability of process and improve the robustness of process or products
Reduce the quantity of work in process and inventory and lower the cost
Shorten TAKT time and make-ready time, understand and respond to customer demand exactly and quickly
Improve customer satisfaction and market share
Improve corporate performance and change corporate culture


Applicable Industry and Field of Lean Six Sigma

Although originated from manufacturing industry, Lean Six Sigma has exceeded its original scope of application after many years of development. Due to its attention to the operating efficiency of enterprise or organization, improvement to the stability of process and construction of positive corporate culture, Lean Six Sigma is applicable to various industries including manufacturing, logistics, financial industry, service industry, etc. Lean Six Sigma has abundant and diversified connotations and is widely applicable. Based on own features, any enterprise can find out the suitable application model by the aid of professionals and finally achieve the goal of excellent operation. 
 

Path and Method of Lean Six Sigma
 

The core of Lean Production is to reduce the cost, improve the quality and shorten the production cycle. 

Path of Six Sigma
 
 

Define Measure Analyze Improve Control
Confirm the problem/opportunity Confirm the sources of data Carry out root cause analysis Develop potential root cause improvement plan Document new measurement process
Draw high level process map Collect baseline data from existing process map Verify the difference between current indicators and the level required Formulate evaluation criteria Verify indicators and collecting system
Collect VOC and business needs Confirm the performance of current process Quantize the opportunities to eliminate difference
 
Select and carry out improved process and indicators Define control plan
Formulate communication plan Verify the effectiveness of data measurement and collecting system Prioritize root causes Measure results Training
Complete project charter   Set up Y=f(x) Evaluate the conformity of improvement to objectives Formulate tracing program
      Risk evaluation  



With its whole set of rigorous tools and methods, Six Sigma can help enterprises to popularize process optimization, identify and eliminate wastes of cost bringing no value to customers, remove activities without added value and shorten the cycle period of production and operation.

Combining the tools of Lean Production with the methodologies of Six Sigma in accordance with specific conditions and absorbing advantages of two models to overcome defects of single method, it achieves a better implementation effect. 

IEG精益六西格玛框架

 

 

 Frame of IEG Lean Six Sigma
 Make your enterprise a perfect engine for profit growth
 Changes of Lean Six Sigma
 Design for Six Sigma    Lean Six Sigma    Value chain of Lean Six Sigma
Concept design New product and process Process design Product improvement Just-in-time Flow and quick response Automation Process improvement Supplier development Order receiving and delivery
 
Lean distribution
 Voice of customer   Stable equilibrium of production   Process plan and control
 Process capability of Six Sigma
 Breakthrough of improvement method
 Leadership of top management


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