Do LEAN and Six-Sigma Work for Services? Three Thoughts

Situation: A professional service company is intrigued by LEAN and Six-Sigma approaches to increasing production efficiency and reducing costs. Most of the examples that they see of LEAN and Six-Sigma in action are in production or manufacturing settings. Do LEAN or Six-Sigma programs apply to processes in a professional services environment?

Advice from the CEOs:

  • LEAN and Six-Sigma are heads-down approaches to process improvement.  In a customized solution environment, standardization of processes has less pay-off. As an alternative, consider Agile Development and similar heads-up process solutions.
  • Agile Development is both a philosophy and a process. Steps to introducing Agile Development to a professional services environment include:
    • Identifying high risk areas of individual project plans,
    • Double resourcing high risk areas to increase the likelihood of fast, satisfactory solution outcomes,
    • Looking for collaborative synergies and scenarios,
    • Scheduling regular team meetings to enhance collaboration,
    • Working opportunistically rather than systematically to increase efficiency, and
    • Using project post-mortems to refine systems and processes.
  • One professional services company which has adopted Agile Development assigns Senior Engineers as outside consultants on projects. These individuals bring a more experienced perspective, and can identify more efficient ways to find solutions and produce a more cost effective and timely result.

4 thoughts on “Do LEAN and Six-Sigma Work for Services? Three Thoughts

  1. James F. Hamilton

    I am a Master Black Belt Six Sigma and My Head is always UP and never is or will ever be Down. My personal associates have their heads UP, as well, all across the World. We look at everything from the ground-up, so we got you covered totally. They are also the only group that looks at things in 4 arenas at the same time:
    1. In the Box ,where most of the World stays most of the time.
    2. Out of the Box, where some of the World ventures from time to time.
    3. Reconfigure the Box ,where most services don’t venture because of costs and fear of the unkown in the current economy and market environment.
    4. Build a New Box ,with its means professing better solutions to acheive more successful ends in todays work environment.

  2. A Cates

    It depends on how you interpret and implement Lean and/or Six Sigma. What they do provide the service organization is a focus on the customer and a process mindset. The focus on the customer provides not just engaging them, but a framework to identify what work should stop – non value added work. Six Sigma compels the organization to reduce variation and provide a consistent customer experience which has been proven (Wharton, 1997, “Process Variation as a Determinant of Service Quality and Bank Performance) to correlate to better financial returns than a traditional organization that focuses on improving targets, or averages.
    Ultimately Six Sigma is just a problem solving methodology in a business context, although as the popularity of the methodology grew and standards of what it actually was didn’t exist, it morphed more into analysis paralysis and death by statistics. In that definition, then yes, service should stay away as the product in service is never duplicated, nor should it be and following modern translations of it could hurt innovation, employee empowerment and flexibility.
    Ditto with Lean. If the original concepts of front line employee empowerment are lost, it’s going to hurt more than help. When the notion of standard work somehow got converted into standardizing and controlling work methods instead of the original idea of working to a standard, all the good things that make customers come back are lost.
    If you are going to apply the methodologies and keep your head up to why, where and how, you will benefit, but like with anything, you can’t just follow it blindly and expect success.

  3. Sandy Post author

    Thanks, James.
    I appreciate your comment. The opinions cited in the article are not mine but those of CEOs responding, in a group format, to the CEO who originally asked the question. I’m not at all surprised that Six-Sigma enthusiasts are irked by the initial comment, offered. However, I’m delighted that you took the time to offer your own perspective.
    Nice web site, by the way. I worked for 10+ years in surgical devices and appreciate what you do.

  4. Sandy Post author

    Thanks very much for this valuable comment. You confirm what the CEOs said about the difference between a production and professional services environment. In the former the job is to maintain high quality while reducing costs in a highly standardized environment. In professional services each job or contract is different, though there may be some similarities among contracts, so a more individualized approach makes sense. Thanks for adding new depth to this conversation.

    A possible exception is medical service delivery. I have seen examples of Six Sigma and LEAN implemented in this environment under the concept of Kaizen. In this environment, while each patient is treated as an individual case, there are standardized techniques for completing surgical and medical procedures, as well as standardized techniques for treating complications that occur during procedures. One might look at this as mass individualization of service delivery because each patient present a unique variation in terms of both the condition presented and the delivery of the appropriate procedural solution.

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