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Model 7 McKinsery factors
When a company decides to change its organization, the seven factors are treated in a given sequence. In the first phase is usually determined the strategy, in the next step, we define on what the company must excel so that it can put its strategy into effect, ie what skills must develop or acquire. The final step is to determine what changes are needed in the other five factors for the change to be a success.
The seven factors :
The strategy describes where the company or the business unit should concentrate his forces and go into the competence and coordinated actions which must be undertaken to achieve a sustainable competitive advantage. In other words the strategy responds to the following questions
- Which should help the company and how?
This strategy shows how the company must adapt to its environment and use its organizational potential. When the company is considering a change in the organization, it must first consider the strtegie, and on the basis of this strategy define the most important skills that need before going further and deciding what changes prove necessary in other factors Model McKinsey.
This model represents a holistic view of business development.
Yes, it is true. Lean Six Sigma drives change in an organization. It inspires people to look at their processes differently – through the data-savvy lens of waste awareness – and to discover, characterize and control their processes. In so doing, this behavior drives process improvements, which often require changes to be communicated, deployed and managed.
But Lean Six Sigma also is, in and of itself, a change management tool that will facilitate the changes that it requires, as well as those of other change initiatives in an organization. As such, even the deployment of Six Sigma enables, rather than impedes, simultaneous change initiatives.
I once worked with an organization that was deploying Lean Six Sigma in some processes, but not others. The processes that used Six Sigma as part of their management system managed projects, documented savings, documented controls, and used a backlog of project opportunities to create budget targets and objectives for their annual operating plan. The processes that did not use Lean Six Sigma instituted some continuous improvement tools, but did not manage their systems with data to the same extent.
This same organization was also attempting to institute self-directed work teams, which are teams of people whose functional role is to work together to achieve a common goal and who require a minimal amount of supervision because of their organization and self-accountability. These teams were a large cultural change for the organization because they were transitioning from a traditional supervisor-technician hierarchical approach. The change required employees to embrace new responsibilities as they adopted a completely different approach to the way they did work.
As many might have guessed, the Lean Six Sigma part of the business was much more effective at converting to the new management culture than the non-Lean Six Sigma areas. Lean Six Sigma had prepared that part of the organization for the changes. For example, because operational technicians, who make up the primary group impacted by the self-directed work teams had gained some ability to communicate in terms of data and understanding processes in a y = f(x) context, they quickly understood the vision of self-directed work teams as they embraced the changes necessary to achieve that vision. While they accepted that there would be discomfort in dealing with the “new frontier,” the operational technicians also recognized that the empowerment that results from the self-directed work team approach would make their jobs much more enriching. Furthermore, the fact that they had already been involved in Lean Six Sigma projects and were important contributors to these improvement projects in the past prepared the technicians for continual positive change as an input to success.
This was in stark contrast to the non-Lean Six Sigma part of the organization, which relentlessly resisted the move and experienced a much more difficult transition. An inherent failure to understand the cause-and-effect relationship between key process inputs and outputs inhibited the ability of the employees to see the benefits of self-directed work teams. In addition, the employees had found a comfort zone in their current work practices, which had rarely, if ever, been challenged by opportunities to change for the better. Their natural response to mandates to improve performance had always been to work harder or wait for management to install new technology, not to participate in the identification and control of root causes, which would fundamentally change the way they did their jobs. That culture bred resistance to any change involving management and accountability structures, and ultimately prompted union actions as a response to the self-directed work team initiative. Eventually, the issues were resolved and the new management structure was instituted, but not without considerable time and effort expended by both management and labor groups. In the end, the self-directed work team system was implemented in the Lean Six Sigma areas of the organization in nine months, whereas the non-Lean Six Sigma areas required three years of change-management effort.
At a different company, in a similar situation with Lean Six Sigma versus non-Lean Six Sigma functions in the same organization, a management information system tool was installed across the entire organization. The new system forced the organization to embrace a new level of discipline in their processes. The people in the Lean Six Sigma areas were prepared – even eager – to accept the new discipline for the benefit of better information with which to manage and improve their processes. In addition, they understood their processes and the critical inputs, and could realize the “future state.” The employees in the non-Lean Six Sigma areas, however, did not see a use for the proposed benefits of the system and consequently resisted efforts to change their processes.
These differences were ultimately reflected in the amount of consulting time and effort spent to implement the information system tool in the two parts of the organization with similar size and complexity. The Lean Six Sigma areas accounted for approximately one-third of the project cost required to implement the change in the non-Lean Six Sigma areas.
In fairness to both of these examples, a considerable part of the difference observed was due to the fact that more enlightened management teams in the Lean Six Sigma areas were more effective at understanding sources of resistance and communicating visions in their respective areas of authority. A person could challenge the conclusions above with a chicken-and-egg argument, suggesting that the management culture was the primary driver of the relative success, not Lean Six Sigma. While that is a valid notion, the fact remains that regardless of the management culture, Lean Six Sigma, as a tool, at least played an important role in facilitating the changes.
These examples make the contribution of Lean Six Sigma to unrelated organizational changes nearly self evident because of the way the methodology changes peoples’ view of how work is done. Of course, like any methodology, Lean Six Sigma can be ineffectively deployed, undermining the expected organizational benefits of the initiative. But an effectively deployed Lean Six Sigma initiative will create:
These are all inherent characteristics or outcomes of a robust Lean Six Sigma culture, and they are recursive, insofar as they facilitate the changes necessary for the implementation of Lean Six Sigma itself. Therefore, Lean Six Sigma represents both change and a tool for change as it supports the deployment of other initiatives.
Taken to its conclusion, this logic naturally refutes one of the most common arguments made by management against the deployment of Lean Six Sigma: “We don’t have time or resource capacity for this, we have too many other critical initiatives.” True, there often are too many initiatives and priorities, but when Lean Six Sigma is seen in light of its true impact on the culture of the organization, then it becomes a vehicle that facilitates the deployment of other initiatives.
Six Sigma is a management methodology which allows companies to use data to eliminate defects in any process. For a process to have achieved Six Sigma, a process must not produce a defect - that is anything outside of customer specifications - more often than 3.4 times per million opportunities. Six Sigma works through the use of two sub methodologies; DMAIC which stands for Define, Measure, Analyse, Improve and Control and is used for existing processes, and DMADV which is used for new processes and stands for Define, Measure, Analyse, Design and Verify. Implementing Six Sigma within a business offers a number of benefits. However there are six key advantages that this methodology will offer any company.
#1: Improved Customer Loyalty
Any business wants to retain its customers. Indeed, this is a significant factor in determining the success of a firm. But, of course, customer loyalty and retention only ever come as a result of high levels of customer satisfaction.
Surveys suggest the reasons given by most customers for not returning to a business are dissatisfaction with the experience and employee attitude. Often a company will not even know they have a dissatisfied customer as they will simply take their businesses elsewhere. Implementing Six Sigma reduces the risk of your company having dissatisfied customers, for once training is complete, so few experiences should be outside of their specifications. To achieve this you may want to consider running a voice of the customer study which helps your business understand which of your products attributes are critical to the customer's perception of satisfaction. #2: Time Management
Employing a Six Sigma methodology at your business can help employees manage their time effectively, resulting in a more a efficient business and more productive employees. Users are asked to set SMART goals and then apply the data principles of Six Sigma to those goals. This is done by looking at three key areas; learning, performance and fulfilment. For instance, under learning, a practitioner of Six Sigma might ask themselves; how often do interruptions take me away from my task and how many of these interruptions require my attention?
Similarly, under performance, they might consider how their practices are helping them reach their professional goals. Users can then create an action plan, the result of which can be employees who are up to 30 per cent more efficient and who are happier in themselves, having achieved a better work-life balance.
#3: Reduced Cycle Time
Unfortunately, most projects firms embark on end up extending beyond their original deadline often because there are changes in project scope or there is a shift in management policy.
By using Six Sigma, a business can set up a team of experienced employees from all levels within the organisation and from every functional department. This team are then given the task of identifying factors that could negatively affect the project leading to long cycle times.
They can then be tasked to find solutions to these potential problems. This method allows business to create shorter cycle times for projects and stick to those schedules, with many firms reporting reductions in cycle times of up to 35 per cent. #4: Employee Motivation
Every business, if destined to succeed, needs its employees to act in the right way - but for employees to do so there must be sufficient motivation. Indeed, organisations who are willing to fully engage with employees have consistently demonstrated 25 – 50 per cent increases in productivity.
Sharing Six Sigma problem solving tools and techniques will allow for employee development and help create a climate and systems for employee motivation. #5: Strategic Planning
Six Sigma can play an integral part in any strategic vision. Once your business has used a created a mission statement and carried out a SWOT analysis, then Six Sigma can help you focus on areas for improvement.
For instance, if your business strategy is based on being a cost leader in the market, then Six Sigma can be used to improve internal processes, increase yields, eliminate unnecessary complexity and gain or maintain lowest cost supplier agreements. In fact, whatever your strategy happens to be, Six Sigma can help make your company the best at what it does. #6: Supply Chain Management
As previously mentioned, the aim of Six Sigma is to have a defect rate of less than 3.4 per million, and your suppliers have a major influence on whether this target is met. One of the possible ways to reduce the risk of defect is to use Six Sigma to drive down the number of suppliers your businesses has, as this in turn reduces the risk of defects.
It’s also important to understand if your supplier is planning to implement any changes. For instance, a change in machinery can have an effect like the ripples from a rock thrown into a pond. The most successful firms drive their Six Sigma improvements as far up the supply chain as possible.
Historically, both the Six Sigma and Lean methodologies have existed to serve the purpose of improving the operational effectiveness in a variety of businesses. In the past, they have stood alone as methodologies. The current trend is to combine Six Sigma and Lean, providing a greater toolset from which operational waste can be identified, measured, and improved. Though the concepts behind Six Sigma and Lean are different, the two can, and arguably should, be used jointly.
Six Sigma Reduces Variability
The goal of Six Sigma is to reduce the variability in a process in order to deliver practically defect-free products and services. Six Sigma relies heavily on statistical analysis to achieve gains in quality and typically has a direct impact to the bottom line. The Six Sigma methodology has a ‘scientific method-like’ approach called DMAIC, which stands for:
In theory, Six Sigma is a fairly simple concept, but implementing a successful Six Sigma project requires immense training, proper sponsorship, and sound statistical measures. While Six Sigma projects can be challenge to implement, the rewards can be substantial. Organizations that adopt the Six Sigma methodology can reach better than a Six Sigma quality, as defects become so rare, that more time can be spent on addressing the root cause. Though the rewards can be significant, the same characteristics that make Six Sigma a success can also be hindrances. Six Sigma requires a level of management commitment that can be daunting to executives. Additionally, the cost and effort required to obtain ‘defect free’ may not be appropriate for some industries.
Lean Eliminates Waste
Lean techniques utilize certain tools and ways of thinking, which are all centered on the elimination of wastes. Lean focuses on the idea of continuous flow manufacturing and pull systems to make the input to a process only available when it is needed. The eight forms of waste include:
Included in Lean are 5S, Poka-yoke, and Standard work, which are all ways to maintain organization, order, and streamlined activities. Lean can be easier to implement than Six Sigma, and the benefits include lower production costs, fewer required resources, more efficient product development, higher quality, and larger profits. Once Lean is implemented, there should be a constant focus towards improvement. Though Lean is commonly used in manufacturing environments, it is not in any way limited in its use, as it is applicable to any process or system.
The Lean-Six Sigma Methodology
Both Lean and Six Sigma are very customer-driven. They utilize different tools, but look to accomplish the same goal of improvement. There is tremendous value to integrating Lean and Six Sigma, as it gives the change agent more tools in their process engineering tool belt. Both seek to create a culture of continuous improvement. They utilize some of the same problem solving techniques, including FMEAs, Pareto analyses, cause-and-effect diagrams, and 5 ‘whys’. Problem definition is a key component to both Lean and Six Sigma. Ron Crabtree, a twenty year veteran in implementing Lean and Six Sigma, and author of “Driving Operational Excellence: Successful Lean Six Sigma Secrets to Improve the Bottom Line”, further explains the need for a Lean-Six Sigma approach. Mr. Crabtree would ask leadership what type of problem they had. There are certain problems that are identified as needing a Lean solution, and others that required a Six Sigma solution, but Mr. Crabtree would find that most executives would recognize that they had multiple problems, which required both Lean and Six Sigma Solutions.
A company taking a true Lean-Six Sigma approach recognizes a mixed use of tools in various stages of their process engineering methodology. The table below represents the mixture of Lean and Six Sigma tools, which can be leveraged as part of the CapTech’s process engineering. Though these tools can be used in various stages, I have included their most applicable use.
Initiate
Analyze Current State
Qualify Opportunities, and Define Vision
Model Future State
Simulate, Implement, and Control
Value Stream Mapping
Prioritization Matrices
Regression Analysis
Design of Experiments
Statistical Process Control
Charter-Problem Statement
MSA Studies
5-Whys
Kaizen Events
Visual Controls
Voice of the Customer
Capability Studies
Cause-Effect Diagrams
Theory of Constraints
Control Plans
Communication Plans
Videotaping
Root Cause Analysis
Pull Systems
Total Productive Maintenance
Critical to Quality Issues
Time Studies
ANOVA
SMED/SUR
Standard Work
Business Results
SIPOC
Multi-Vari Analysis
5S
Procedures and Work Instructions
Benchmarking
Collecting Data
Hypothesis Testing
Work Flow Improvement
Training Requirements
Lean and Six Sigma are different, but seek to accomplish the same goals. Proper utilization of these tools can increase the positive impacts of the improvements, and create a better chance for success.
Lean management techniques has improved both the efficiency and effectiveness of how business process operates.Application of lean management has improved the following
LeanAgree with answer given by mr. Nadjib RABAHI
in my opinion
lean management and Six Sigma complement each other. Lean accelerates Six Sigma, delivering greater results than what would typically be achieved by Lean or Six Sigma individually. Combining these two methods gives your improvement team a comprehensive tool set to increase the speed and effectiveness of any process within your organization – resulting in increased revenue, reduced costs
Mr. Shahzad's execellent submission sums it up, i fully agree & endorse it.
Thanx for the invitation
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Nice answer given by Shahzad Yaqoob
That's true, and I can tell you that determination and will of changing are highly important when it comes to running a business. Unfortunately, not every entrepreneur is ready for an industrial digital transformation, and I can tell you that it's necessary nowadays to improve the efficiency of a business.
Agree on Mr. Nadjib. Thanks for your invitation.
Agree with answer given by mr. Nadjib RABAHI
