Results show that companies experience shorter lead times, greater employee efficiency, and increased market share, all with the employees they already have in place. In fact, some organizations utilizing Lean Six Sigma have discovered that they often didn’t need fill open positions they were actively recruiting for. They were able to stop recruiting because they were able to eliminate so much non-value added work. Interestingly enough, the thinking that is the source of what is known as Lean today was developed in Japan after World War II, when the economic conditions were strikingly similar to what they are today. After the war, the Japanese economy was devastated. Two of its major economic centers were destroyed by the atomic bombs – the country’s supply chains and infrastructure were in complete chaos, raw materials and goods of all kinds were in short supply, and inflation was rampant. When the government took action to control inflation, it reduced consumer demand and commercial credit dried up. Due to financial pressures, a third-rate auto manufacturer known as Toyoda Motor Company (it used to be spelled that way) was forced to reduce their labor force by 25%. After the reduction they had to figure out how to do business differently – they needed to deliver value to the marketplace consuming as few resources as possible because they literally had no choice. They began involving every employee in process improvement activities and created a cultural mindset of “doing things right the first time” and “doing them better the next time.” This cultural pursuit of perfection evolved into what became the “Toyota Production System” and is known as “Lean Manufacturing,” “Lean Business,” or simply “Lean” today. It was this cultural shift that enabled Toyota to rise up and challenge General Motors as the world’s largest vehicle manufacturer and deliver some of the longest lasting, most reliable vehicles on the road.
Using Lean Six Sigma as an organization wide problem- solving approach engages everyone from the front line to the board room to examine work processes, identify the sources of errors, delays, or bottlenecks, and then work together to implement solutions to streamline the process. Through the efforts of streamlining a process, efficiency gains of 30% to 50% or more with a single focused improvement project is common. This simplifies the work and reduces the needed labor so employees can devote more time to other value-added work. For years, organizations have used Lean Six Sigma as a business strategy to do more with less. In the current labor shortage environment, we already have less. Companies are struggling to do even the same amount of work as in past years. As we move forward, savvy organizations are looking to all avenues to resolve their labor needs. Lean Six Sigma, coupled with an automation and technology strategy, is a proven path toward lightening the labor need and is enabling these organizations to outperform their competitors in quality, lead time, and customer experience. As consumers we all know that the companies that best meet our needs attract more of our business. With change comes opportunity, and we all have seen a great deal of change these past two years. The organizations who seize the opportunity will emerge in a stronger position than before anyone even heard the word COVID. For more information about how Lean Six Sigma can help your organization, contact Chris at cmspranger@sprangerbusinesssolutions.com
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Center for Business and Economic Insight
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