“Speaking Out”

August 2011

John Novak

John Novak is the President and a Trusted Advisor at KAVON International, Inc., a business consultancy that helps clients create Value in order to attain and sustain a Competitive Advantage in the markets they serve.

John earned his Bachelor of Science (BS) degree in Manufacturing Technology from Bowling Green State University and his MBA from Kent State University. He is also Certified as a Lean/Six Sigma Master Black Belt and Quality Auditor. John also serves as adjunct faculty at Kent State University.

John has spent time working in both the manufacturing and consulting industries.

Lean Six Sigma

Lean Six Sigma is not Just for Large Companies Anymore!

By John Novak

Wany organizations and their employees incorrectly believe that deploying Lean Six Sigma Green and Black Belts as part of a Lean Six Sigma continual improvement program is not for small companies. I vehemently disagree! All organizations, large and small, have to satisfy their stakeholders? Small and mid-sized companies face the same issues as large organizations only on a smaller scale. Common issues include:

  • Customers demanding products and services that meet their requirements

  • Competitors, which are trying to increase market share

  • Quality issues, which must be addressed before the integrity of their products and services is compromised

  • Concerns about their ability to remain a viable business

All organizations are defined by a set of interrelated processes that must operate in a cohesive manner in order to achieve the objectives of the organization and deliver value to their customers. When these processes fail to operate in an effective manner, quick action must be taken to improve the situation before the customer is negatively impacted. If the existing processes are not effective in producing competitive products and services, the viability of the organization itself may be put in jeopardy.

Since all organizations, large and small, face these issues, it is imperative to have a continual improvement process that can be mobilized quickly to remedy the situation. The solution is Lean Six Sigma, which has a proven track record for solving problems and improving outcomes.

Many small businesses compete in a global marketplace with their larger counterparts, which can generate intense pressure to reduce costs and still provide quality products and services to their customers. Lean Six Sigma can act as an equalizer, allowing the small company to remain competitive.

What Is Lean Six Sigma?

First of all, Lean Six Sigma is a philosophy aimed at improving value for the customer through the elimination of process waste and a reduction in process variation.

Secondly, Lean Six Sigma is a set of tools, which are deployed at the tactical level to realize the philosophy and achieve the strategic objectives of the organization. Lean tools increase the velocity of an organizationís processes by eliminating waste and improving flow. Six Sigma tools improve quality through the identification and reduction of excessive process variation. The philosophy and tools should be embraced by all organizations, big and small. Ask yourself why would these principles be important to large companies and not small companies? The answer is they are important to both in order to maintain competitive position and profitability.

Continual Improvement for Smaller Companies

In order for companies to achieve their objectives, they need to embrace a culture of continual improvement throughout the organization and adopt a set of tools, which allows them to understand and improve their processes. For smaller companies it is a question of magnitude. A Lean Six Sigma deployment within a small company would not be expected to yield the huge financial savings that are reported by larger companies, but the need to satisfy customer and stakeholders, remain competitive and generate profits is still a necessity.

Even though smaller companies donít have the resources of a large company they do have some advantages:

  • Smaller companies are generally more agile in their ability to respond to a changing environment and thus are able to respond more quickly to changing customer requirements.

  • Smaller companies have flatter organizations and donít experience the turf wars that often exist in large organizations.

  • Fewer layers of management can result in quicker decision making.

  • Since employees wear many hats, they are exposed to more aspects of the business and may be better equipped to understand cross functional processes.

The key to being able to capitalize on these advantages is having a defined continual improvement methodology and a set of tools that are understood and practiced by the employees of the organization. Smaller organizations can begin by using outside consultants to initiate the program and facilitate projects in the early stages. Once some experience is gained, in-house facilitators can be developed.

Deployment of Lean Six Sigma Methodologies and Tools can be flexible and tweaked to meet the specific requirements of the organization. Small and medium sized companies that discount and ignore the benefits of a Lean Six Sigma continual improvement program are doing a disservice to themselves, as well as their stakeholders. The highly competitive global environment in which we live today, demands companies to actively seek ways to deliver more value to their customers. Improvement is not a one-shot deal; it must become part of the fabric of the organization. Everyone involved must believe and actively participate in a culture where the status quo is constantly challenged and continual improvement is a daily activity.

I think Dr. W. Edwards Deming said it right, "It is not necessary to change. Survival is not mandatory." The choice is yours; in todayís economy can you afford to take the risk?

KAVON International, Inc. is a business consultancy that helps clients create Value in order to attain and sustain a Competitive Advantage in the markets they serve. If your company is seeking registration or compliance to any of the Quality Management System standards such as ISO 9001, ISO/TS 16949, AS9100, ISO 17025, ISO 14001, or ISO 13485, or wants to establish a continual improvement program using Lean Six Sigma methodologies, give us a call and let one of our Trusted Advisors help you with implementation and training.

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