Tokyo, Japan at junction
Supply Chain Management (SCM) and Lean Six Sigma (LSS) have operated pretty much independently of one another as each of the disciplines has evolved over the last 20 years.  What I have found interesting in my work with large and small organizations in the implementation of LSS in operations, and in sales and marketing, is an interesting common thread.  In almost every case as organizations progress down the path of implementing LSS – we end up working on supply chain projects. Why?  It’s really not difficult to understand once we realize that initial efforts in LSS usually focus on internal operations and naturally migrate to look up and down the supply chain.  This most often first occurs when the organization begins to look to increase the component of the Voice of the Customer (VOC) in their activities.  Both Lean and Six Sigma advocate strongly the importance of knowing the customer…
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School Buses on a highway
We recently completed an organizational opportunity assessment for a K-12 public school system in my home state of Michigan.  Implementing Operational Excellence (OpEx) and Lean Six Sigma (LSS) in public school systems is not a totally new idea, but as a practical matter, my research shows less than 1% of school districts nationwide are seriously looking at OpEx as a means to improve. About eight months ago I met a group of school superintendents in Southeast Michigan to offer some ideas on how they could embrace best practices in OpEx and LSS to help them cope with declining funding, enrollments and in some cases, declining outcomes in education for our precious children. I won’t say that the idea that they are probably wasting 30% to 50% of every dollar they are spending to run their school districts was met with much enthusiasm.  In fact, they were not a little defensive.…
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Man using mouse payments online shopping and icon customer network
Bringing new products and services to market quickly, that meet and ideally exceed customer expectations for value utility, needs to be at the forefront of businesses strategic and tactical activities going forward.  In the aerospace and defense arena the need for improvement is being driven by both the government and military as well as by foreign competition (Airbus comes to mind), who are attempting and often succeeding in winning larger market share every year. Although technology can and should be a major area of focus to find ways to collapse product and service delivery times and improve results, I recommend that “good ‘ole Lean” approaches must be carefully integrated in a strategic and tactical manner as well.  In fact, I would argue that if you are not already heavily engaged in leveraging Lean approaches in your product/service design processes, it is reasonable to expect that 80% of the improvements you…
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Marketing Conversion Funnel
Over the last year I have been heavily involved in helping to apply Lean ideas in different service sectors including health benefits administration, medical labs, and most recently, in the marketing and sales arena.  Although there are elements of Lean, Six Sigma, Theory of Constraints and other operations excellence methodologies involved in each case, I continue to find that Lean ideas get the most traction quickly in getting meaningful change underway. Time and again the common theme from businesses in the service sector is: “how can we apply Lean ideas in our situation?”  In the new APICS Communities of practice, I have introduced how 5S can make a powerful difference in service businesses.  We will not discuss it here, but it should be noted that 99% of the time 5S is a great place to start if it is not already ingrained in the culture.  In all service industries, there…
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Lean Thinking, Six Sigma, Principles Of Lean
The ability to reduce lead times is a key differentiator in competitive markets, service industries and the nonprofit arena.  All Lean tools attack waste; and time, specifically lead time, is a key area where waste tends to creep in.  Three Lean tools in particular can help: Value Stream Mapping (VSM), cellular/flow designs, and setup and changeover methods. Map It When we start thinking about reducing lead times, the first step is to build a VSM of the current state processes, recording what is really happening, not what is supposed to be happening.  For example, at a printing company I worked with, the amount of time it took to process a new quote was excessive.  There was a great deal of confusion, finger pointing and guesswork regarding the cycle and what should be done about it.  So, my colleagues and I hoisted a video camera on one shoulder to find out…
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Total Quality Management, TQM
Six Sigma is a scientific term that some smart guys figured out how to coin into a new important buzzword in the business lexicon. The foundations for Six Sigma can be traced back to the early 20th century and the first efforts to focus on quality as a key competitive factor. It was not until the formation of the Japan Union of Scientists and Engineers (JUSE) by Gen. Douglas MacArthur at the end of World War II that the modern concepts of Total Quality Management took shape in a cohesive way. The scientific term Six Sigma is derived from the values found in a normally distributed bell-shaped curve of a population of data. Without giving a lesson in statistics here, let’s use a simple analogy to understand what this means. Understanding the Concept of Six Sigma In the graphic on this page, we can see what this normally shaped curve…
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continuous improvement concept on the gears, 3D rendering
APICS has been heavily involved with understanding and applying the theory of constraints (TOC) for a number of years now. Adopting and applying Lean principles has happened more recently—leading many people to wonder if TOC and Lean can and should work together. The core tenants and rules associated with TOC can be found in Eli Goldratt’s best-selling book, The Goal, and a series of follow-up works. Of all the things Goldratt taught us, my favorite is the fundamental question: “Why are we in business? What is the goal?” I agree with Goldratt: It is to “make money now and in the future.” The basic steps are: Identify the constraint. Exploit the constraint. Subordinate all other operations to exploit the constraint. If after numbers 2 and 3 more capacity is still needed to meet market demand, elevate the constraint. Go back to number 1: Don’t let inertia become the new constraint.…
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Lean in the ERP World

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chess board game concept of business ideas and competition
Lean and ERP together is an oxymoron in the minds of many people – and this is no surprise when you examine where these two camps are coming from.  Take the viewpoint of the ERP gurus who say, “just give me an accurate bill of material, routings, forecast, inventory and open order status – and I’ll give you the ultimate plan.  We can achieve control through the efforts of a handful of skilled users and then let production just worry about making what is needed when it’s needed.” On the other hand, the Lean gurus take the position that “if we simply level-off our processes and demand, we can execute with low levels of waste, with simple, visual tools.  Achieving control and success comes by involving everyone in the execution process – including the planning and replenishment of materials throughout the value stream.” Well, in my opinion, they are both…
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Businessmen of the pitfalls and miniature
Thousands of businesses around the world have been jumping on the Lean bandwagon over the last 20 years.  Of late, we are seeing many medical and service organizations adopting Lean practices as well.  That’s the good news.  The bad news is very few businesses succeed at achieving the level of performance improvement we read about in the books.  There are countermeasures, however.  The key elements to be addressed here include: Initial implementation planning, setting goals and picking the right metrics. Kicking off the Lean implementation process—establishing urgency, vision, and training and development plans. Enablers and roadblocks in key Lean tools, including value stream mapping (VSM), teamwork, empowerment, and Kaizen. Setting up an effective project management methodology. Initial Planning All too often, the initial implementation planning is kicked off as a vague desire to improve the bottom line.  Management recommends “something” to capitalize on Lean tools.  Rarely do management team members…
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Male manager with heavy elephant
In the good old days, one of the toughest projects one could tackle would be running an ERP implementation project implementation.  We learned quickly that successfully implementing a MRP or ERP system was fraught with danger and uncertainty.  We also learned that the true effort and the complexity of the task was usually grievously under-estimated.  Though the effort it takes to be successful in an ERP system implementation is fairly well documented and understood, implementing Lean and World Class Manufacturing is less so. Implementing Lean Manufacturing and Six Sigma brings up many questions about how to successfully go about it.  Recently I was asked, “Why is it such a big deal implementing Lean Manufacturing?  After all, the book I just read suggests I only need to worry about managing the value stream . . . Why is it so hard to do?” To help those who have a strong background…
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