Value Analysis is one of the common denominator and an integrator of Lean and Six Sigma and towards Design and Innovation…. Much has been said to identify the differences between Lean and Six Sigma where Lean focuses on Speed while Six Sigma focuses on Variation both attempting to influence the reduction of waste.
In the context of starting a lean or six sigma project, it all begins with the voice of the business (VOB), the voice of the customer (VOC) or the voice of the process (VOP) depending on the level of your improvement initiative to either influence the business or quality or process control parameters.
Understanding the context of value leads us to detail such as a ratio of benefit to cost thereby influencing the ability to increase customer satisfaction thus revenue and the ability to reduce waste thus cost. Improving both benefit and cost is then a trigger to influence both productivity and efficiency leading ultimately to business value.
A Lean project in Singapore
The company is part of a business concern that does design, manufacture, sales and service of scientific equipments used in the manufacturing industry.
Recently, management has decided to improve its process cycle time and reduce the non-value-added work so as to improve the overall productivity and efficiency of its operations. One such initiative is to improve the Equipment Sales Order Fulfilment Process, an important, high-pressured business process, with associated problems of high overtime and late deliveries.
Evolving Quality Management System into a Framework of Operational Excellence
The ever changing global economy coupled with fierce competition and growing sophistication of customer needs warrants a sustained breakthrough performance in key areas of business. While the ISO family of Quality Management System provides the necessary ingredients leading to the success of an organisation, it doesn’t provide the means and the how’s to achieve the company’s vision for sustained breakthrough performance.
Theory of Contraints (TOC) is a philosophy attributed to the pioneering work of Dr. Eli Goldratt in 1986. In the 1980s, while Asia was focusing on setting up factories and product quality improvements, the West embraced TOC which linked system improvements to the bottom line.
A key premise in this theory is that the rate of revenue generation is limited by at least 1 constraining process or bottleneck. Hence, to increase overall throughput or revenue generation, we must treat the bottleneck.
What is a constraint or bottleneck? It can be the market (eg not big enough), a policy constraint (eg must sell all products at all cost even those with thin or negligible profit margin), or an internal resource constraint (eg lack of competency, insufficient capacity).
Lean-Sigma has moved beyond a concept toward a mandatory methodology. Organisations who implemented Lean-Sigma have very high process capability, very few variations, customer oriented and free from waste throughout its supply chain.
History of Lean-Sigma concept goes a long way back to the QS-9000 era and later on ISO/TS 16949 (both are quality management system standards for automotive industry). This can be seen on the goal of ISO/TS 16949, namely:
To develop a fundamental Quality System that provides for:
- continual improvement
- emphasis on defect prevention
- reduction of variation and waste in the supply chain