Making Lean Six Sigma Work In Services

Posted by on Jun 23, 2019 in Lean Six Sigma, Service Business | 0 comments

Organizations sometimes struggle when they try to adapt Lean Six Sigma tools and techniques to service related industries.  Many of these tools and techniques were developed in the world of manufacturing where there is typically a lot of data, which is not the case in many service areas.

However, the need for Lean Six Sigma in service related industries is enormous.  Consider the following:

  • It has been estimated that rework, mistakes, redundancy, etc. in service based businesses and processes typically run as high as 50% of total budget.
  • Prior to improvement, many service processes perform in a range of 1.5 to 3.0 sigma, i.e., yields of 50 to 90 percent.
  • Analysis of service processes has shown that less than 10 percent of the total process cycle time is to true value-added time for which the customer is willing to pay for.  Ninety percent of the time is tied to waiting, rework, searching, inspecting, and other non-essential activities which are all non-value-add and delay the delivery of the service to the customer.

What makes Lean Six Sigma in services more challenging?

There are a number of reasons Lean Six Sigma is more challenging in services.  They include:

  • Work processes are invisible. It is very difficult to observe a process and see the flow of how work occurs.  It’s difficult to see information flow, requests, orders, proposals, meetings, signatures, and ideas and how they contribute to the delivery of the overall service.
  • Workflows and procedures tend to evolve without a lot of deliberation and sometime in response to a one-time occurrence. Responsibilities change, forms are revised, new steps added, additional signatures required and policy changes can occur based on a particular situation that arose and “that must never happen again!”
  • Lack of facts and data. Service processes are generally harder to measure which results in skimpy data if any data exists at all.  It may be easy to see stacks of documents, but harder to see the rework, delays, and the costs associated with them.

Making Lean Six Sigma work in services

To allow Lean Six Sigma to work in services and overcome the “this doesn’t apply to us” skeptics, the following suggestions are given:

  • Start with the processes. Look at the flow of work, i.e., the delays, rework, added steps, signatures, etc. that delay the service delivery.  Start by taking data and determining what can be done to reduce or eliminate them.
  • Be focused in your efforts. Keep the scope of your improvement efforts narrow.  Take one process at a time and get everyone involved in that process engaged.
  • Keep things simple. Continuous improvement boils down to using common sense.  Don’t burden employees with fancy statistics or complex tools and techniques.  Start by using some simple techniques such as 5S and visual controls to improve your processes.  Getting organized will help speed up processes and eliminate some of the non-value-added activities.

Overall, it’s more important for employees to be able to ask critical questions about their processes and customers.  Questions such as “Is there a better way to do this?” will benefit the organization more than sophisticated tools and techniques.

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