Lean Six Sigma is a philosophy focusing on the continual improvement of people and process in both manufacturing and service environments. This philosophy challenges the status quo of daily activities with the mindset that there is always an opportunity for improvement in the way we execute our processes.
Lean Six Sigma is a combination of two schools of thought that attack waste and variation in an organization:
• Lean, originally created by Toyota, focuses on eliminating eight specific types of waste to shorten the lead times of products and services. The eight specific types of waste are represented by the acronym D.O.W.N.T.I.M.E (Defects, Overproduction, Waiting, Not Using peoples Talent, Transportation, Inventory, Motion and Extra Processing). Lean is basically about getting the right things to the right place, at the right time, in the right quantities, by minimizing waste and being flexible and open to change.
• Six Sigma, originally created by Motorola, focuses on reducing the variation in a process to ensure more predictable results and higher-quality products or services. Six Sigma follows a rigorous five-step process known as DMAIC (Define, Measure, Analyze, Improve and Control).
Together, these two approaches to business process improvement provide a powerful combination—driving speed and reliability and ultimately maximizing customer satisfaction. Lean helps remove waste, and Six Sigma helps remove variation. When used together they provide an organization with the tools to identify and eliminate waste and variation and develop a culture that aims to continually improve every day.
A tool within the Lean Six Sigma space, specifically applicable to investment recovery and the basis of all Lean Six Sigma Systems, is Six-S (or Five-S, as originally designed by Toyota). Six-S is a method that enables an organization to drive cleanliness and visual management across the enterprise by enabling all employees to distinguish abnormal activities from normal activities and empowers them act on and correct the abnormal conditions. The Six-S’s are Sort, Straighten, Shine, Standardize, Sustain and (most important) Safety in all we do. As we execute Six-S activities, we tend to find assets that are excessive, obsolete or no longer needed. Upon identification of these assets, disposition and recovery of investment becomes integral in maximizing the benefit of these activities. At the end of the day we find ourselves with a neat and orderly work environment, an environment that facilitates visual management and hopefully a little bit of extra cash in our pockets.
In summary, utilizing Lean Six Sigma in the investment recovery space can provide multiple benefits. It will not only identify assets that need disposition, but it will also drive cleanliness and visual management for your organization.
All of these activities will drive improvements to the bottom line, satisfying employees, customers and shareholders. To see how PPL began its Lean Six Sigma implementation, read the article on the next page.