These photos show the before and after results of the Six Sigma team efforts. All the tools are now identified for proper location, and the worktable is no longer a catch-all for miscellaneous equipment with everything having a designated place.

Within larger organizations like Toyota and General Electric, Six Sigma and lean manufacturing have overshadowed techniques previously viewed as the continuous improvement tools of choice.

Yet, many smaller companies seem to be taking a "wait and see" attitude toward these methodologies. Are these tools simply the latest in a long line of methodologies to come and go over the last few decades? Or will the techniques in the Six Sigma and Lean Enterprise toolbox stand the test of time? Do they hold promise for companies that make up 99% of the organizations in America (those that employ less than 500 people)?

Developed at Motorola and perfected at companies like General Electric, Six Sigma has saved billions of dollars in waste, rework, and reclaim costs. A statistical term applied to the degree of process capability, Six Sigma has become a target for holistically measuring all aspects of the business enterprise.

What is Lean? Getting more done with less. A simple phrase, yet difficult for many companies to achieve. Lean manufacturing is the term often associated with the Toyota Production System. Credited with turning around not only an automobile company, but an entire nations' (Japans') manufacturing capability, the Toyota Production System has matured into a systematic approach to identifying and eliminating waste of every kind. Its tools and techniques apply to administrative functions as well as manufacturing processes. Many techniques in the lean manufacturing toolbox are also found in the Six Sigma tool belt. When dovetailed, these programs complement each other rather than compete for resources.

How do these tools relate to the term world-class? The most common application of the term world-class in modern language is in regard to athletics. When asked to identify individual athletes who stand out as world-class, there are only a handful who come to mind; Mohammed Ali, Lance Armstrong, Tiger Woods--you might be able to think of 10 or 20 more.

What are the characteristics that separate ordinary athletes from world-class athletes? When the Lean Enterprise Training Company asks this question in our workshops, the answers usually include attributes like talent, dedication, drive, determination, coaching, practice, adaptability, flexibility, consistency, creativity, motivation, and so on.

When you examine athletic performance, the distinguishing characteristics and attributes that can hold individuals back from world-class performance are solely within their control, and generally have little to do with the building they play in, or the shoes they wear. It's all about behavior.

Now, think about world-class companies. Which ones come to mind, Kodak, IBM, Toyota, Harley Davidson, Microsoft, Nike? If asked to develop a list of behaviors that manifest themselves in the form of world-class performance, what attributes or characteristics would your list include? Dedication, talent, drive, determination, it ends up being the same list as that applied to the athletic world, doesn't it?

In business today, to be recognized as ordinary means failure. Likewise, success is driven by being viewed as the world-class leader in your industry. This status doesn't come without effort or cost. When you consider Six Sigma and lean at a company the size of General Electric, the costs associated with a program like Six Sigma or lean may seem impractical, if not impossible, to a small organization.

However, when you realize that most world-class companies allocate only between 0.5% to 1.5% of sales to their continuous improvement efforts, it doesn't seem so daunting. They also approach each project as they would any sound capital decision. The ROI (Return on Investment) must make sense. Therefore, concentrating on projects known as low-hanging fruit is always a good business decision. The benefits gained from one Kaizen event (Kaizen, a term applied to continuous improvement projects) should help pay for the next event.

Obviously, the approach used at General Electric won't work in a 20-person or even a 200-person job shop. A hybrid approach is necessary to avoid spending all the profit supporting a team of black belts and green belts (in-house Six Sigma experts). In many cases, the use of consultants for Kaizen Blitz Events and spot training is a more economical means for small organizations when they're getting started. Responsible consulting groups help develop in-house experts and capabilities to ensure perpetuation of the program.

We recently had the privilege of working with Sunset Manufacturing Inc. (Tualatin, OR). It's a family owned, 35-person shop with a vision of themselves as a world-class performer, and they want their customers to see that level of performance in everything they do. They established a lean steering committee of senior staff and folks from the production department. This team meets regularly to discuss their vision and the steps necessary to make sure everyone's compass and efforts point in the direction of a common objective.

The lean steering team at Sunset Manufacturing Inc. realized early this year that their customers were being pressured to deliver just in time. Sunset also received help on their lean transformation through one of their OEM customers that was a lean advocate.

At the same time, their customers were paying a higher degree of attention to cost reductions and quality improvements. These were seemingly conflicting objectives until Sunset Manufacturing began running Six Sigma and lean Kaizen events to improve their manufacturing processes. They realized, as have many companies just starting down the lean path, that fixing one problem can yield huge savings, sometimes in unexpected areas.

Here is a case study from Sunset Manufacturing, outlining how their team saw an opportunity to decrease the percentage of non-value added activities (a term applied to any activity that, in the eyes of the customer doesn't add value to the product). This particular case study revolves around the time required to setup a machining center. In the process, the team achieved improved dependability, repeatability, consistency, and reliability (quality) from the output.

The Kaizen team at Sunset was chartered by the lean steering committee to try and reduce what had historically been a four-hour setup on a vertical mill by 50%. The team used the SMED (Single Minute Exchange of Die) methodology perfected at Toyota by Shigeo Shingo, along with a secondary Kaizen event centered around 5-S (a workplace organization technique known as: Sort, Straighten, Shine, Standardize, Sustain) in the tool room.

SMED methodology was used for quick part setup on the milling machine by standardizing components, while the 5-S project included reorganization of the tool-storage methods. In the past, it could take longer than 15 minutes to find the right tool. Now anyone can come into the tool room and find any tool by having it identified within the workorder system. Average tool preparation time went from 30 minutes to less than 10 minutes. Consistency also improved due to better identification of tooling and isolation of worn tools and holding devices. Safety was also improved as floors and desktops are now kept free of sharp tooling and tripping hazards.

Sustainment is nearly always a challenge after any Kaizen event. This team implemented an audit process that requires an impartial party to measure key elements of the should-be condition weekly. They now track their progress over time.

Taken nearly three months after the event, the after photographs speak for themselves.

Machine setup was reduced from 216 min (3.5 hr) down to 36 min (0.6 hr) an 83% improvement.

A device called Dance Cards, which define a pit-crew approach to machine setup and have every step of the setup defined in sequence so that minimum downtime occurs, were also used.

The team calculated a positive annual impact of more than $33,000 for this event (the event cost less than half that). More importantly, they are now able to perform six to seven setups in the time it previously took for one. This time savings allows smaller lot sizes, lower inventory, and cost improvements, helping them become even more competitive. Quality improvements for this and similar setup-reduction events at Sunset have netted up to a 75% reduction in setup scrap.

These photos show some of the changes made by the team to save time for machine setup. Left photo is before and right after a Kaizen event.

Sunset's vision to be the world-class machine shop of choice in this area gets clearer everyday. What is the greatest positive impact Sunset has recognized for their lean efforts? Rob Nees, the lean committee chairman says, "The greatest positive impact Sunset has seen is the renewed enthusiasm and awareness from the entire team. Employees feel empowered to make things happen when they need to happen, not after the fact."

Why is a world-class focus important? President Bush paid Oregon a visit in February 2002 to recommend a new plan to infuse businesses there with new vigor. Oregon business continues to suffer the result of layoffs in the shrinking wood product industry and foreign competition in other sectors. It has been a brutal 10 to 15 years for their economy.

President Bush used Oregon as a poster child for what a state looks like with the slowest economic growth in the nation, along with the highest unemployment rate. His recommendation for new growth--tax incentives to buy new and more equipment.

But equipment to make what? Before you need equipment, you need to have an order to make or sell something. There is nothing wrong with new equipment, but the answer is not solely in new mechanical technologies. Instead, companies like Harley Davidson and others have discovered that the answer lies in changed behaviors. The many tools of Six Sigma and lean manufacturing will help your organization meet these customer needs while improving your bottom line, regardless of the size of your company or industry you serve.