Abstract
This chapter aims to apply the Lean Production and Six Sigma in global operations, thus describing the theoretical and practical overviews of Lean Production; Lean Production in sustainable operations; Lean Production in human resource management; Lean Production in health care; Lean Production and environmental management; Lean product development; Lean Management and sustainability; Six Sigma; Six Sigma, learning, and knowledge management; Six Sigma in health care; Six Sigma in service industry; Lean Six Sigma; and the significance of Lean Production and Six Sigma in global operations. The creation of Lean Production and Six Sigma is crucial for modern organizations that seek to serve suppliers and customers, increase business performance, strengthen competitiveness, and acquire regular progress in global operations. The chapter argues that applying Lean Production and Six Sigma has the potential to enhance organizational performance and achieve strategic goals in global operations.
TopBackground
Lean Production and Six Sigma have been the powerful movements for improved product quality, optimized material flow and reduced waste within manufacturing and service industries (Krogstie & Martinsen, 2013). Lean Production targets the non-value added (NVA) work to make processes more efficient (El-Homsi & Slutsky, 2010). Lean Production, also known as Lean Manufacturing or Lean, is considered as a well-consolidated strategy for cutting down costs, especially costs related to production processes. Lean Production derives from Toyota Production System (TPS), a term that is coined by Womack et al. (1991). A critical point in the Lean Production approach is value creation (Hines, Holweg, & Rich, 2004).
Six Sigma approach was first developed in the late 1980s within a mass manufacturing environment in Motorola (Lighter, 2011) as it struggled to meet demanding quality targets on complex manufactured product, and became widely recognized when GE adopted it in the mid-1990s when it evolved from being a process improvement methodology to a broader, company-wide philosophy. Motorola and GE still consider Six Sigma as the basis for their strategic improvement approach. Since the 1980s, Six Sigma has become one of the most famous improvement actions, broadly implemented around the world in a broad range of companies (e.g., Boeing, DuPont, Toshiba, Seagate, Allied Signal, Kodak, Honeywell, Texas Instruments, Sony, Bombardier, and Lockheed Martin) that all declared considerable financial savings (Kwak & Anbari, 2006). Other benefits claimed for Six Sigma include increased stock price, improved processes and product quality, shorter cycle times, improved design, and increased customer satisfaction (McAdam, Hazlett, & Henderson, 2005).
Key Terms in this Chapter
Value Stream Mapping: A way to keep track of goods and material as they move through the product-creating process that helps a business boost productivity and reduces wastes.
Lean Production: The initiative focused on eliminating all wastes in manufacturing processes.
Total Quality Management: A holistic approach to long-term success that views continuous improvement in all aspects of an organization as a process and not as a short-term goal.
Triple Bottom Line: The financial, social, and environmental effects of a firm's policies and actions that determine its viability as a sustainable organization.
Lead Time: The amount of time, defined by the supplier, that is required to meet a customer request or demand.
Toyota Production System: A manufacturing strategy developed by Toyota Motor Corporation of Japan over a period of many years.
Just-in-Time: A strategy that exposes waste, makes continuous improvement a reality, and relies on total employee involvement.
Six Sigma: The initiative focused on increasing profits by eliminating variability, defects, and wastes that weaken customer loyalty.
Lean Six Sigma: A management approach for problem solving and process improvement based on a combination of the different tools of Lean Production and Six Sigma.