Lean and Six Sigma were originally used in manufacturing, but have become more and more prevalent in the business world. Both methodologies are used to optimize processes, but in different ways. Six Sigma is focused on reducing variation and defects, leading to improved yields. This problem-solving approach uses statistical tools to gain insights and drive process improvements. Lean methodology is focused on improving workflow by minimizing waste. Simply put, Lean is about creating more value using fewer resources, focusing strongly on continuous improvement.
Lean and Six Sigma’s growing popularity in business is because they are actionable ways to produce better results. Regardless of the industry, service, or product, there is waste in business processes and room to reduce variation from these processes. By using Lean and Six Sigma, companies are able to reduce waste, optimize processes, and effectively measure key performance indicators every step of the way.
We extract the most useful principles of Lean and Six Sigma to drive our Revenue Factory. Here are some ways we’ve implemented them:
As mentioned above, Six Sigma focuses on reducing variation and defects to drive improved process yields. One cornerstone of our process is Six Sigma’s DMAIC model. DMAIC stands for Define, Measure, Analyze, Improve, and Control, and it is a way to use data to improve, optimize, and stabilize business processes. The steps are outlined below:
Define: First the problem is defined, making sure that everyone knows their role and the purpose of the process.
Measure: This is a data-collection stage used to establish baselines as the basis for improvement.
Analyze: This step is used to identify, validate, and select the root cause(s) of the problem for elimination. A plan is created to measure data related to the root causes and find out how much each one contributes to the problem.
Improve: In this step, the solutions are implemented to solve each root cause that contributes to the problem.
Control: After a solution is implemented, a control plan is put in place to sustain the process and ensure consistent gains.
Lastly, the performance metrics decided upon in the “measure” step will be compared to the metrics at the end of the DMAIC process to objectively determine whether there was improvement.
We have seen the effectiveness of this process firsthand to increase conversions through better messaging and increase CRM database efficiency.
Lean improves workflow by minimizing waste. According to Lean methodology, waste comes in 3 forms:
Mura – waste due to uneven workloads
Muri – waste created through overburdening people, equipment, or the system
Muda – an overarching label that covers 7 categories of waste, including waiting, overproduction, and overprocessing.
We use this to pinpoint waste and work on improving it. In an example analysis we performed, we realized that conversion rates were very good when speaking with decision makers, but the total number of calls necessary to speak to a decision maker was high. This was the overprocessing category of muda. In order to overcome this, we needed to figure out what concrete steps were necessary to maximize time spent speaking to decision makers and minimize time spent on other actions. We were able to combine these insights from Lean with the DMAIC framework to concretely define the problem, decided on metrics to base improvement on, analyze possible solutions, implement them, and measure progress.
Also, inherent in Lean is the concept of continuous improvement. This principle weaves through all of VizQuest and is what keeps our Revenue Factory’s metaphorical machines sharp and polished. It is imperative that a company constantly looks for ways to improve, reduce waste, and become more efficient.
Lean and Six Sigma are an integral part of optimizing a sales force and one of the key factors of our proprietary revenue factory. Increasing process yields and minimizing waste, with the concept of continuous improvement in mind, are concepts that all companies should be cognizant of, and something we pride ourselves in implementing as central tenets of our methodology.