What is Lean?
The term ‘Lean’ was coined in the 1990s in the Womack and Jones best seller The Machine That Changed the World: The Story of Lean Production. The book chronicles the transitions of automobile manufacturing from craft production through mass production to lean production. It revealed how the Toyota Production System (TPS) had transformed a small post-war Japanese concern into the most successful car company in the world.
The core aim of Lean is to eliminate non-value-adding activities (those which the customer would not want to pay for), to compress time and to create competitive advantage by optimising the use of limited resources (people, space, capital).
Toyota’s success was remarkable – in the 1980s a Toyota took 17 hours to build and was ready to be shipped. A Mercedes spent that time in the rework area alone.
What is Six Sigma?
‘I don’t even know what a sigma looks like – so why would I want six of them?’
Since Motorola pioneered it in the 1980s, Six Sigma has become popular in many sectors. It is not hard to see why when one looks at its primary claim: defects reduced to 3.4 per million items produced. Thousands of businesses have spent millions of pounds, yen, dollars and euros implementing Six Sigma programmes.
The objective of a Six Sigma philosophy (programme, culture, project, etc) is to manage variability. Without variability, any business would improve dramatically. It affects customer service levels, costs and delivery performance.
5 Classic Efficiency Mistakes
Get a group of managers together and discuss Lean or Six Sigma improvement and one of the few things you are likely to get them to agree on is that measuring efficiency is a good start. Among the many options, OEE is a popular and powerful measure for businesses across a range of industries – so how can such a simple and powerful tool lead so easily to complacency?
Complacency? Surely it’s the yardstick against which all progress is measured? In theory, yes, but experience shows that there are some very simple traps that many organisations fall into when measuring efficiency which can have a profound negative effect on improvement in the organisation. Let’s look at the 5 most common ones…