Lean and Six Sigma have now matured as the premier continuous improvement tools in today’s business environment. But there is still much confusion over which is the best tool to use and when. Some companies declare themselves staunch six sigma advocates and some are just as passionate about the lean tools. This mindset can often cause us to use the wrong tool set in our continuous improvement endeavors; the proverbial square peg in a round hole. [Read more…]
How do You Apply Lean Growth Solutions to Drive Sustainable Competitive Advantage
Successful, profitable innovation (the lifeblood of any company) means developing the right products for the right markets at the right times. For technology-driven product companies, the last remaining areas of competitive differentiation lie in their product planning and the ways they innovate. Innovation is imperative for these companies.
That’s a huge challenge because today, half the R&D dollars that companies spend yield no return at all. Why? Because they: lack market knowledge; mis-reading customer needs; portfolio misalignment; poorly managed requirements; Incorrect timing. And the list goes on.
Sustained profitability in hyper-competitive markets requires companies to balance product innovation investments, cost efficiency, visibility, and predictability. It’s a very complex product management processes. So how can you consistently bring winning products to market faster and more profitably? By applying Lean Growth solutions aligning your product portfolio with customer needs and your company’s strategy and by tying product planning to execution.
I would be interested to know if you are facing similar challenges and how you are responding to the need for rapid exploitation of products to generate a sustainable competitive advantage.
What Should we do First, Lean or Six Sigma?
I continue to be asked: “what should we do first, Lean or Six Sigma?” Here is our position on this subject:
- Six Sigma is a problem solving tool. Problem Solving is a subset of Lean (which is comprised of many tools), and it makes no sense to build a culture around a tool like Six Sigma. Lean culture should be developed around Lean principles, and never around a tool.
- Many companies try to solve all problems using the Six Sigma process. This is inappropriate. When the only tool you have in your tool box is a hammer, all of your problems look like nails.
- We believe that a large majority of all problems can be solved using basic problem solving methodologies. There is no need for an elaborate approach like Six Sigma for most of an organization’s problems.
- The Six Sigma methodology is usually a long, drawn-out process, where projects can take 6 to 9 months. Lean is much quicker in terms of results. Lean zealots have the view of not letting “perfect” get in the way of “better”.
- Lean rests on the input of the all associates within an organization. Due to the complexity of Six Sigma, not all associates can meaningfully participate in the process. I have seen Six Sigma “cliques” form in an organization, which is rather elitist and dysfunctional.
- By starting with Six Sigma first, there is a danger of improving a process that should not exist in the first place. Lean is all about process improvement, creating flow, etc. and many times help identify processes that are non-value adding and should be eliminated. Why improve a process that should not exist in the first place?
So, where does this lead us? I firmly believe that Six Sigma works nicely within a Lean transformation, but the key is to use the right tool at the right time. I would be interested on your opinion, your successes and your challenges.