Lean vs. Six Sigma

Often times you hear the word Lean and then other times, you hear the words Six Sigma.  Sometimes you hear all three together...Lean Six Sigma.  So, what's the difference?

Lean is about eliminating waste.  Waste can be anything, but most think of waste as excess material or the scrap, in a manufacturing process.  There's far more to it though, especially in non-manufacturing settings.  As one digs into the many facets of waste, they'll discover it could be the excess movement of paperwork along an approval process.  Waste could be waiting for the person or process up-stream to provide what's needed to complete the tasks assigned to the next person down-stream.  It could be the inordinate amount of walking that staff must do to move from their desk to the copy machine/printer when their role precipitates a large interaction with that device.  It could even include creating hardcopies of agendas, presentation materials and the like when history shows that they are most likely thrown out after the meeting.

Six Sigma is about eliminating variability, which when done improves quality.  So, what is meant by variability, especially when it applies to service and back-office operations?  Consider a firm who develops custom web sites and a not-for-profit who plans any number of fundraising activities.  Most likely, both have a process that they follow to achieve an outcome because they have been doing it for quite some time.  Is it consistent though?  Can they predict an outcome based upon a set of input data?

In other words, can the web site developer consistently follow their process to understand their customer needs, build, then deploy the site meeting all metrics and achieving the same level of customer satisfaction and quality for every single site built?  Probably not.  Something is missed or misunderstood, rework is needed, delays occur, and targets aren't hit every once and a while.  Tracking this information is key to reducing variability, which allows improving the process, so that consistent results are obtained for every single customer and site built.  The same is true for the not-for-profit when they plan a golf outing, gala, or any other fundraising activity that occurs once or multiple times per year. 

When the same process is followed time and time again, analysis of the steps in the process can lead to eliminating wasteful activities, thus streamlining the process.  It can also lead to reordering the steps so that activities contained therein are executed in a more efficient manner.  The process can then be analyzed for variability, like having to do rework on the web site development, to understand why the rework was needed, and to determine if the process could be improved to eliminate future occurrences of that type of rework. 

The benefits of applying Lean and Six Sigma to a process in the services sector or the back office are seen in both hard costs and soft costs, depending upon the process that is being worked on.  For example, using Six Sigma to address the number of improperly coded items that results in product returns will result in a reduction in shipping costs while distributing supplies closer to the workers that use them the most frees up worker's time to perform other tasks.  Either way you slice it, it's an improvement that flows to the bottom line.