Do 70% of Attempted Lean Six Sigma Implementations Really Fail?
Recently, I saw a website post estimating that 70% of businesses fail in their attempts to implement Lean Six Sigma (LSS). The author of the post did not provide data or evidence backing up that estimate, so I’m not sure if the percentage is valid. But based on my experience and observations, I have some insights to offer.
My sense is that business leaders who embark on Lean Six Sigma don’t fail outright; however, some lose interest and quietly abandon the effort without having realized the benefits. Here are a few reasons I think that happens, and a couple of strategies to consider if you want to beat those odds.
• Four reasons for losing interest in Lean Six Sigma
#1. Leadership expects results immediately, or at least quickly, and are unwilling to stay the course. The approach sounds like, “I listened to this audiobook about Toyota during my commute last week. You all should too.” Followed shortly by, “Why is it taking you more than 3 months to get it done?”
#2. A senior manager directs all subordinates to “fix” one metric in 90 days, a metric that is only a small piece of operational excellence. For example, “Get Excess & Obsolete inventory down to $2.5-million by March 31!” Important? Maybe, but not the only important indicator. However, the pressure causes people to do unnatural things to hit that one metric, so other important objectives are sacrificed. Lean Six Sigma is a broad-scope, long-term strategy, not a “do it today and see the results tomorrow” action.
#3. The business tries to add LSS to what they’re already doing, meaning additional Key Process Indicators, rather than making LSS the basis of their strategic plan. LSS should simplify, not complicate. Lean focuses on how your business processes add value as perceived by customers, while Six Sigma involves a parallel focus on measuring critical-to-quality parameters in the process, and maintaining control of variation. Done properly, these strategies will reduce the number of indicators needed to run the business over time.
#4. Probably the worst reason goes something like, “We have outsourced our production to a contract manufacturer (CM), so Lean and Six Sigma are their problem (the CM), not ours. We just negotiate lower pricing, and move to another CM if they won’t budge.” Outsourcing doesn’t excuse the product owner from quality issues. Let me ask a blunt question: If you, as a customer, experience a problem with your laptop computer, do you fault the company who assembled the product or the one whose logo is on the front panel?
• OK, then how do you beat the odds?
Step one is to consider Lean Six Sigma not as an activity you do or a set of tools you implement, but as a core element of your business philosophy, a greater purpose that drives the firm. When you decide that serving your customers with excellent products and service will guide your operational decisions all the time, then improvements in the business processes will follow. If that leadership attitude is observable and unwavering, the transformation to a learning organization and culture gains momentum.
Given that philosophy, when an ad hoc team of people attempt an improvement, the first experiment may not pan out as expected. They are blazing a new trail, and sometimes they will hit a dead end. The second, fifth, or fourteenth experiment may be the one that results in the hoped-for breakthrough 50% performance improvement. A dozen 3% and 7% hits are good, too. Edison famously said he did not fail 10,000 times at inventing the light bulb, rather, he learned 10,000 ways not to design it. Leaders at all levels need to let the learning process play out, provide needed resources, and encourage the pursuit of excellence, not penalize failed tries.
Implicit in all of this is the need for training, education, and learning. Yes, the three are different, and of the three, the most important is learning. A training course does not confer expertise in the trainees; it is a starting point. Personally, I have engaged in formal LSS training programs at least eight times over my engineering and operations career, with different content providers and perspectives. Each instance helped me take steps in the right direction. However, the on-job application is the mechanism that elevates training and education to higher-level learning.
Lean Six Sigma is a strategic approach to change for the better – an ongoing process, not an event. There will never come a day when you will say about your company, “Now we are fully lean and our quality is Six Sigma everywhere. Finally, we can rest on our laurels.”
Do the work to integrate Lean Six Sigma into your business processes, starting with production, engineering, and quality, then expand outward from there. Oh, and be sure to enjoy the journey!
Dann Gustavson, PMP®, Lean Six-Sigma Black Belt, helps Program Managers and their teams achieve superior results through high-impact program execution. Prepare, structure, and run successful programs in product engineering, manufacturing operations (including outsourcing), and cross-functional change initiatives.
Contact Dann@Lean6SigmaPM.com.