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Lean: lower costs, sell more

by Technologia
November 3, 2020
Lean: lower costs, sell more

Process optimization is a subject that occupies many companies because it allows them to improve their processes and at the same time provide a better customer experience.

Lowering costs, selling more... few company managers would say no to this proposition.
This optimization can take various forms, depending on the "philosophical" choices of the company and its sector of activity. We propose to focus more specifically on :

  • Lean Management
  • Lean 6 Sigma

Lean Management

This approach is directly linked to the optimization of processes, the ultimate goal of which is to allow greater flexibility in order to respond better and faster to customer expectations.

That is why Lean is based on 3 main principles:

  1. Create added value in the eyes of the user/customer
  2. Eliminate what does not contribute to creating value
  3. Improve, again and again

Point 2 can be qualified by extending it to everything that the user or customer is not willing to pay for, because it is supposed to be "included". The fact that the delivery truck had to take a detour, that the inventory is not up to date, that the instructions are incomplete, that the product or service has defects, etc.: this is not the problem. This is not the customer's problem and, above all, it does not add value. It is therefore essential for any company to identify these "loss" areas and correct them.

To achieve this, Lean has developed "sub-techniques" such as :

- Just-in-time: produce and deliver only what is needed, when it is needed and in the quantities needed. The ultimate goal is to produce the best possible product, at the lowest cost with minimal use of resources and in the shortest possible time.

- The 5 "S's" (from Japanese: Seiri, Seiton, Seiso, Seiketsu, Shitsuke) which correspond to: Sorting, Tidying, Cleanliness, Order and Rigor

- Kanban: this is a visual tool, initially designed for inventory management, but whose use has been expanded to maximize a team's efforts.

These sub-techniques are often combined.

For a team leader, Lean Management offers several advantages:

  • The team is focused on what produces value for the customer
  • Its productivity is improved because parasitic tasks have disappeared
  • The processes are optimized
  • Resources are used in an optimal way

To know more about it:

Lean Management : optimizing processes and organizational performance

Lean 6 Sigma

The Lean 6 Sigma methodology is in fact the aggregation of the Lean method, which aims to eliminate what does not add value, and 6 Sigma, which is focused on process improvement and defect reduction.

Six Sigma is subdivided into two methodologies:

  • DMAIC (Define, Measure, Analyze, Innovate, Control) - for existing products and services
  • DMADV (Define, Measure, Analyze, Design, Verify) - for new products

Lean 6 Sigma focuses on DMAIC to improve existing products and processes.

- Define: the project objective (e.g. reduce delivery time from warehouse to store)
- Measure: the processes in place
- Analyze: why there are defects
- Innovate: by making the necessary corrections
- Control: regularly to ensure the correctness of the changes made, or even find new ones.

By doing so, the company can reduce its man-day costs, improve its sales and increase customer loyalty.

In summary, this approach offers several advantages for the company:

- Cost reduction
- Standardization and simplification of processes
- Reduction of errors/defects
- Employee development
- User and customer satisfaction

The degree of mastery of Lean 6 Sigma is declined in color belts (non-exhaustive list):
- White or Yellow: beginner, methodological approach and available tools. To raise awareness among all personnel
- Green: member of an important project or responsible for a secondary project.
- Black: for Lean 6 Sigma project managers who must master several aspects (communication, project management, team management, analysis and problem solving...).

To know more about this course:

Lean Six Sigma : Certification / Yellow belt with exam

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