Lean methodology, often referred to as Kaizen; it is a continuous improvement approach which incorporates people from all levels of the organisation and focuses on small process improvements over a long period. In Kenya today, we have adopted an attitude of predominantly short-term thinking, taking reactive measures to socio-economic pressures and spontaneous policies dished out precariously by authorities. This approach has been accepted and implemented nationwide and at all levels of society and is something that must be addressed and fixed. Due to the prevalence of this attitude in Kenya at large, it is safe to assume that the same outlook is ubiquitous in Kenyan businesses and organisations.
When addressing the pitfalls of adopting tactics such as top-down management, “management only” strategic planning, focus on short term profit, and equating organisational performance to financial performance; one must evaluate the relevance and benefits of swapping the short term and reactive thinking attitude for a more wholesome and beneficial philosophy (Burke & Hess 2018). In many ways, Lean Six Sigma is this philosophy; it is an operating philosophy that yields long term benefits (Boufis & Frigo 2018).
Lean on its own is an approach which derives its origins from the Toyota Production System, focusing on eliminating waste in processes, where waste is defined as anything that does not add value to the process. Value in this statement is defined by the customer, and so lean in its essence is a customer centric philosophy, which accounts for and addresses the most important stakeholder in the supply chain, the customer.
Six Sigma is an approach used to reduce variation in processes, with the ultimate goal of continuous process improvement. Six Sigma is a very data centric approach, where process variables are measured, data from the measurements is used to do complex root cause analysis, simulations and prototyping is carried out to test new solutions and improvements to processes, and control systems are implemented to observe and evaluate post improvement performance (Rastogi).
Lean Six Sigma has traditionally been used in manufacturing businesses but can ultimately be used across all sectors and industries in the Kenyan economy. If the following basic premise about an optimised supply chain, which can be applied to all businesses, is taken into consideration: “Get your customers what they want, when they want it – and spend as little money as possible getting that done” (Marion). Then the core tenets of Lean Six Sigma, which include waste reduction, efficiency improvement and customer focus, all of which combine to drive profitability, can also be applied to all types of organisations.
Businesses in the service sector are sometimes hesitant about applying Lean Six Sigma in their organisations. Reasons such as long cycle times, complex process variables, multiple decision points and not physically observable processes are cited as the main barriers for implementing Lean Six Sigma in the service sector (Ross 2017). Moreover, these are the very same reasons why Lean Six Sigma should be applied in organisations in the service sector. Lean tools like visual management can be used to make otherwise indiscernible processes, visible to the whole organisation (Ross 2017). Once this is done, employees can then apply their efforts on critically evaluating the processes and improving them. Furthermore, the processes can then be standardised, allowing employees to carry out the processes with a lesser degree of variance and more efficiently (time wise), ensuring process outputs are consistent in quality.
Organisations that perform well in the short-medium run are also very hesitant to apply Lean Six Sigma, these same organisations also measure their performance using financial metrics, such as revenue and profit. The underlying question for management in an organisation that is content with its performance is: How do you measure organisational performance? Unless performance is measured based on customer satisfaction levels, the business is susceptible to a variety of serious risks including; volatile macroeconomic conditions, new competition in the market place, low economic growth, among a host of other perils. The underlying continuous improvement tenet which is integral to the Lean Six Sigma methodology, prepares a business to be flexible and prepared for the risks that come with operating in a market-based economy. The customer defines value, this definition changes with time, and therefore so does the process of elimination of waste. The continuous improvement approach must then be a perpetual process, which must also be carried out at all levels of the organisation.
All in all, this allows a business to enjoy the benefit of longevity, providing an amplified amount of organisational opportunities to increase financial performance. It is important to remember on the whole, that a business which is lean, measures performance based on customer satisfaction levels and is flexible and adaptable to change in the long run, is better of than a company which performs well financially in the short run but will not exist in the long run.
In the long run, if businesses focus on a customer centric approach, where the value is passed onto the customer, standardised processes which are continuously reviewed and improved are implemented, waste is constantly being eliminated from processes and data control is used to reduce cycle times; costs will reduce, and together all of these actions will drive profitability.
Boufis, Eli, and Mark L. Frigo. “The Unseen Advantages of Adopting Lean Manufacturing Principles.” IndustryWeek, IndustryWeek, 5 Feb. 2018, www.industryweek.com/leadership/unseen-advantages-adopting-lean-manufacturing-principles.
Marion, Gary. “Is Lean Manufacturing Relevant Decades After Its Emergence?” The Balance Small Business, The Balance Small Business, www.thebalancesmb.com/is-lean-manufacturing-still-relevant-2221467.
Burke, Jason, and Stephen Hess. “Lean Principles in Healthcare: 2 Key Tools.” Health Catalyst, 10 July 2018, www.healthcatalyst.com/lean-principles-in-healthcare-2-key-tools.
Rastogi, Ankit. “A Brief Introduction To Lean, Six Sigma And Lean Six Sigma.” GreyCampus Initiative, www.greycampus.com/blog/quality-management/a-brief-introduction-to-lean-and-six-sigma-and-lean-six-sigma.
Ross, Karyn. “Lean Is Even More Important in Services than Manufacturing.” IndustryWeek, 29 June 2017, www.industryweek.com/blog/lean-even-more-important-services-manufacturing.