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Lean Six Sigma and the Baby Boomers

Europe’s population is aging. More and more workers, especially the Baby Boomers, are or will be approaching retirement age in the very near future. When this group of workers begins to leave the labour force, it will place great demands on the existing workforce and on the economy as a whole. Through Lean Six Sigma and Lean Transformation we might be more efficient with less resources. But how will we deal with the lesser knowledge and experience of the Baby Boomers?

Europeans relocating from other parts of the continent or immigration will not address the full shortage of workers in the European economy. In order to successfully meet the challenges of the demographic shift and the high demands of today’s employers, we need to tackle the labour issue from both the supply and demand sides of the equation.

It is important to understand that all companies compete in a global market place and, more often then not, are competing with companies with a greater cost advantage. To ensure European companies are able to sustain themselves, they must look at how they can improve operational efficiencies to maintain their competitive advantage.

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Lean for Production and Services

A popular misconception is that lean is suited only for manufacturing. Not true. Lean applies in every business and every process. It is not a tactic or a cost reduction program, but a way of thinking and acting for an entire organization.

The core idea is to maximize customer value while minimizing waste. Simply, lean means creating more value for customers with fewer resources.

A lean organization understands customer value and focuses its key processes to continuously increase it. The ultimate goal is to provide perfect value to the customer through a perfect value creation process that has zero waste.

To accomplish this, lean thinking changes the focus of management from optimizing separate technologies, assets, and vertical departments to optimizing the flow of products and services through entire value streams that flow horizontally across technologies, assets, and departments to customers.

Eliminating waste along entire value streams, instead of at isolated points, creates processes that need less human effort, less space, less capital, and less time to make products and services at far less costs and with much fewer defects, compared with traditional business systems. Companies are able to respond to changing customer desires with high variety, high quality, low cost, and with very fast throughput times. Also, information management becomes much simpler and more accurate.

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The word is, lean transformation !

Businesses in all industries and services, including healthcare and governments, are using lean principles as the way they think and do. Many organizations choose not to use the word lean, but to label what they do as their own system, such as the Toyota Production System or the Danaher Business System. Why? To drive home the point that lean is not a program or short term cost reduction program, but the way the company operates. The word transformation or lean transformation is often used to characterize a company moving from an old way of thinking to lean thinking. It requires a complete transformation on how a company conducts business. This takes a long-term perspective and perseverance. A client of PEEC doing just that, it’s the new word! lean transformation.

Lean for Production and Services A popular misconception is that lean is suited only for manufacturing. Not true. Lean applies in every business and every process. It is not a tactic or a cost reduction program, but a way of thinking and acting for an entire organization.

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Looking for new types of waste in Lean

As Lean concepts have been developed over the years some other wastes have been added to the original 7 (TIM WOOD).

  • The waste of Untapped Human Potential

This relates to intellectual capacity not just physical labour

 

  • The waste of Inappropriate Control Systems

This relates to minimising complexity (Push ERP/MRP/SAP vs Pull JIT and Kanban)

 

  • Wasted Energy and Water
  • Waste of Customer Time and Defecting Customers
  • Service and Office Wastes

 

  • The waste of Human Capacity

This relates to physical capacity during meetings, decision making

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Translating Customer Needs into Key Process Measures

Listening to the Voice of the Customer.

Do we really know the answer to these questions?

  1. How does the customer view my process?
  2. When it starts for them?
  3. When it is finished?
  4. What is the customer looking for when measuring the performance of my process ?
  5. How well does my process meet the customer’s expectation of what constitutes value ‘in their eyes’?

We must first understand who the Customer actually is.  We should then define how to listen to the Customer when he is expressing his opinions about the quality of our products or services.  There may already be an established process within your business to extract this valuable information on an ongoing basis (Market Research), however, it may also be the case that the business does not capture such information in a coherent and usable format.  This is often the case with internal customers.  Therefore, specific techniques and deeper analysis is required to understand what the customers requirements for the process output actually are.

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Lean Six Sigma in Veränderungsprozessen

In Veränderungsprozessen wird Führungskräften viel abverlangt. Altes soll nicht mehr gelten, Neues klappt noch nicht, Niemandsland. Wer hier Organisationen begleiten kann oder muss, braucht professionelles Wissen über den Ablauf von Veränderungsprozessen, Strategien und Instrumentarien für die gezielte Planung und Umsetzung.  Unsere kompetenten Trainer vermitteln Ihnen in diesem Green Belt and Black belt Seminar das notwendige Wissen, um diesen Herausforderungen zielsicher zu begegnen.

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Process Improvement requires ‘solution thinking’

Solution thinking often means being “creative”

It is useful to think about looking elsewhere for ideas as Benchmarking and looking within the team for ideas as Creativity

Many people, technical thinkers in particular, but others as well, often view all kinds of “creativity” on projects negatively; we want hard facts and analysis, “Creativity” has the reputation for being wild, uncontrolled, undisciplined; the generation of new ideas that were of limited (or no!) practical use

But remember, you have not improved something until you have created something new.

Green and Black Belts will learn that creativity can be managed. It can be focused. It can be the reason that the Lean Six Sigma project succeeds.

Creativity is a skill which anyone can learn to do better, the creative process can be accelerated and directed.

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Why does productivity matter?

Productivity growth plays an active role in offsetting inflationary pressure and as well as long tern economic growth. This is achieved through greater resource allocation and human resource efficiency, effectiveness and engagement; increased innovation and technology diffusion and capital investment.

Productivity is an essential component to the success and health of every company in Europe and the overall standard of living.

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Lean Six Sigma , labour and productivity

What is the difference between labour and multifactor productivity?

Labour productivity is measured as real output per hour worked. Multifactor productivity, a broader measure of efficiency, is measured as real output per unit of combined inputs (capital, labour, etc). In essence, this is the efficiency of all or your factors of production.

Progress in productivity constitutes a significant source of increased standard of living. In the long run, increases in real hourly earnings are tied to productivity gains. The European economy has been able to produce more goods and services over time, not by requiring a proportional increase of resources such as labour, but by making production more efficient. The overall performance of any company, operating in any industry, is comprised of at least seven key criteria:

  • effectiveness
  • efficiency
  • innovation
  • productivity
  • profitability
  • quality
  • quality of work life
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