Manufacturing companies in a range of industries are wise to keep their focus on improving business processes, eliminating waste, and reducing costs.
Management teams traditionally look to Lean, Six Sigma, and ERP to support these efforts.
Instead of seeing these approaches as “mutually exclusive,” our ERP consulting team finds that the most successful companies understand how Lean, Six Sigma, and ERP work together. They are able to make improvement progress more quickly and more efficiently.
Looking at Six Sigma
ManuSix Sigma is a business process improvement strategy originally developed by Motorola. The methodology seeks to improve quality by reducing variability and improving processes.
Today Six Sigma enjoys widespread application in many sectors of industry, but often is not in sync with the ERP system.
The term “Six Sigma” comes from a field of statistics known as process-capability studies. The term refers to the ability of manufacturing processes to produce a very high proportion of output within specification.
Goals of Six Sigma
Six Sigma’s implicit goal is to improve all processes to a consistently high level of quality.
Ultimately, Six Sigma is about being customer-centric. To enhance customer satisfaction, manufacturers want to deliver consistent and predictable services and/or products with near zero defects.
Six Sigma seeks to improve the quality of process outputs by identifying and removing the causes of defects (errors) and variability in manufacturing and business processes.
The Six Sigma approach uses a set of quality-management methods, including statistical methods, and creates a special infrastructure of people within the organization (“Black Belts,” “Green Belts,” etc.) who become experts in these methods.
Bringing in Lean
Lean manufacturing is another business approach we often see being implemented without thought of coordinating with the ERP selection process.
An Industry Week article entitled “Can Lean and ERP Work Together?” has made the case that there are often conflicts between lean and ERP. Specifically, the article notes that ERP implementations have a top-down approach, focused on sales forecasts for materials planning. They note that lean adheres to a pull-based production-scheduling mantra, with inventory kept to a minimum via an in-plant Kanban system that replenishes materials and parts as needed.
Despite this friction between “push” vs. “pull” manufacturing, the article cites examples of manufacturers that find ways for lean initiatives and ERP systems to work together.
Ultra offers a free resource to explore this topic further.
Download the white paper “Lean, Six Sigma, and ERP: Putting it All Together for Improved Performance.”
The paper showcases how ERP, Lean and Six Sigma can be combined to create the perfect environment for continuous improvement
You’ll see that when Lean, Six Sigma and ERP implementation are in sync, the journey of continuous improvement will be a journey that never ends.