Just when we thought productivity of UK workers was in the ascendency, out comes a report from the Office for National Statistics (also known as the ONS) telling us the exact opposite.
In fact, not only is our ability to compete with international rivals facing downwards instead of upwards, it is at the same level as before the pre-financial crisis levels…hardly the feel good news you need with more Brexit uncertainty ominously peeking its head around the corner.
Apparently the hourly output per worker fell 0.5% in the first three months of 2017 so again we’ll be asked the million-dollar question: how do we solve the productivity puzzle and stop lagging behind trading partners in the US, France and Germany?
Now there’s probably not one golden answer to this. However, one thing that is certain is that lean manufacturing and the implementation of Six Sigma can play an important role in cutting out waste and, subsequently, boosting productivity.
The big issue here is that a significant proportion of British manufacturing is failing to fully embrace these two industrial practices. Yes, they may say they are ‘lean’ or are committed to getting some of their staff trained to Green Belt standard, but the reality is they’re saying it because their competitors do or, even if their intentions are honourable, they’ll be sacrificed the first time things don’t go quite right.
“Lean and Six Sigma aren’t fads, they have to be built into your culture, they’re part of your everyday routine,” explained PP Control & Automation’s Ian Knight.
The company’s chief technical and information officer has been a Black Belt in Six Sigma for nearly nine years now and has seen first-hand the difference it makes on the shopfloor as his firm has grown from £15m to £20m turnover in the last five years.
“In a nutshell, Six Sigma is a disciplined, data-driven approach and methodology for eliminating defects. Although its origins date back to the 1800s, its first notable use in modern manufacturing was in 1986 when Motorola Engineer Bill Smith introduced it into production to change the culture of counting defects per thousands to defects in a million.
“Is 99% good enough? Well that’s the equivalent to about 15 minutes of unsafe drinking water every day or no electricity for almost seven hours each month!”
“Working with defects per millions gives you a thousand time more opportunities to improve your quality performance. Thirty years on and the same methodologies are used across many companies and lots are extremely effective. However, the success rate of a lean/Six Sigma transformation isn’t as good as you would imagine, with some qualified commentators estimating it anywhere between 5% and 50%!”
Ian continued: “Albert Einstein famously defined Insanity as doing the same thing over and over again and expecting different results. So why when given the odds do we? Why do so many fail?”
Ian Knight on…
What is Six Sigma?
There are so many different explanations to this question that engineers – at the start of their Six Sigma journey – can often get lost in the translation
One of the easier-to-understand definitions is that ‘Six Sigma is the implementation of a measurement-based strategy that focuses on process improvement and variation reduction through the application of improvement projects’. The key message here is ‘measurement-based’ not ‘opinion-based’.
Primarily, this is accomplished through the use of two sub-methodologies:
DMAIC
• Define the problem and the project goals
• Measure in detail the various aspects of the current process
• Analyse data to find the root defects in a process
• Improve the process
• Control how the process is done in the future.
DMADV
• Define the project goals
• Measure critical components of the process and the product capabilities
• Analyse the data and develop various designs for the process, eventually picking the best one
• Design and test details of the process
• Verify the design by running simulations and a pilot program, and then handing over the process to the client
The DMADV method is typically used when creating new processes or new products and services.
Lessons to learn
Once you have agreed that you want to go down the Six Sigma route then don’t expect an easy ride.
It’s designed to test you, your company and your beliefs, but that can be a good thing. It certainly has been at PP Control & Automation: without it we wouldn’t have established ourselves as an industry leader in supplying electrical control systems, cable harnesses and sub-contract manufacturing solutions to 13 of the world’s largest manufacturers.
Below are some important lessons we’ve learned along the way…
1. Strategy
This is the first step in making Six Sigma work for your business. Before you start the journey, you must have determined ahead of time what your vision and direction will be. Set this as your strategy and communicate it widely across the business so that everyone knows what is happening and, more importantly, what their role is in making it happen.
A word of warning. Don’t attempt too much too quickly, but don’t introduce it too slowly either. Getting the balance right will mean the initiative will burn bright and explode and not fade into the distance.
2. Leadership
Identify your leaders at the very start. You want leaders who are firm and inspiring, relentless and resilient, demanding yet forgiving, focused and flexible. Above all, they have to be smart and highly respected in the business.
Every successful company has at least one of these leaders and these people must be a passionate part of the lean and Six Sigma leadership team. Involve them in the design of the programme and listen to their views.
More than likely they will be your future Green or Black Belts.
3. Champions
Expertise is essential when implementing and delivering Six Sigma. So is critical mass. There must be a sufficient amount of knowledge among a sufficient number of people for initiatives to work initially and then spread.
Furthermore, the expertise must reside within line people. Everyday support must come from important, respected line managers who have the most to gain or lose and have the power and authority to make things happen. Abdication to staff experts who have no line authority to implement actions or decisions is unrealistic.
4. Copying
One of the biggest causes of failure is when companies believe they can get the required results from applying tools that others have developed. Some management teams think all they have to do is copy Toyota and General Electric, the reality is a disaster in waiting.
Successful implementation must be closely related to the management philosophy and vision, the problem at hand and combining this with the culture of the business to create your own problem solving processes.
5. Thinking it’s just a tool
Implementations of lean and Six Sigma cannot be treated as a delegated ‘project’ or as an ‘add on’ to what you are already doing. They must be treated as a fundamental change in the business system and senior management must be fully behind it and instrumental in communicating it.
You must also not use every Six Sigma tool on every issue you face…sometimes it can overcomplicate things and can actually lead to a simple solution being missed that can be solved by following the rigour of the DMAIC process.
6. Customer Focus
When many companies take the decision to go down this route, the primary interest is to improve internal cost rather than customer-focused reasons. This is a little short-sighted and could result in the exercise failing.
We have found that the best approach is to provide the client with more value sooner. Without the customer focus, improvement techniques are often difficult to employ.
7. Engaging & Educating Employees
Employee participation in project decision making is a main principle affecting innovation, productivity and ensuring work satisfaction.
Staff almost always have more complete knowledge of their work than management does. Therefore, if you can secure full participation from the outset, decisions will be made with the best possible pool of information.
It also goes without saying that training is crucial, but the content, level and depth vary according to the company and its needs, activity and function. At the risk of repeating things, it all goes back to the strategy. Training needs to be appropriate for the elements to be deployed.
8. Understanding
Most management teams don’t understand or have conflicting views when it comes to lean or Six Sigma and this can cause real issues.
When we don’t understand something it is next to impossible to support it. This lack of understanding allows even the most subtle of issues to derail efforts that could have taken weeks, months or even years to implement.
9. Metrics
There is an insatiable appetite to measure things in today’s current business environment and that can be a good and bad thing when it comes to Six Sigma.
Traditional cost accounting techniques such as absorption, as well as individual machine and employee performance, can cause a lot of non-supporting behaviour and lead to the implementation not delivering as much as it should have done.
Metrics that focus on the processes of value creation and their associated costs are much more preferential to a successful outcome.
10. Success stories
We first started the journey of continuous improvement nearly 24-years ago when the decision was taken by the senior management to find ways in which we could differentiate ourselves from our rivals.
There was an appetite to be the best when it came to manufacturing quality, speed and culture.
The roadmap soon stretched into the implementation of company-wide lean manufacturing and Six Sigma and, over the following years, I would estimate that we have invested more than £5m into this approach.
£5m may sound like a lot, but not when you consider the vast benefits and success we have enjoyed as a result.
This has ensured that every member of our 210-strong workforce receives 200 hours training every year, we now have access to a dozen Six Sigma Green Belts and a second Black Belt overseeing proceedings alongside myself.
During that time, we have implemented and completed 100s of DMAIC projects, focusing on eliminating waste, freeing up capacity and introducing new machine builds.
There have been many highlights, including a 95% reduction in crimp failures by analysing and optimising variables and, more recently, optimising the cable manufacturing process to one-piece flow has removed £50,000 of work in progress (WIP).
PP Control & Automation in 2017 is now a world class manufacturing operation that has grown from £15m to £20m over the last three years, with an ambitious strategy in place to double this to £40m by 2020.
Our state-of the-art facility in the West Midlands has recently benefitted from a £1m extension, giving us new dedicated manufacturing space, a modern logistics facility and the capacity to take on an increasing amount of outsourcing opportunities.
Lean manufacturing and Six Sigma have both played a crucial role in our evolution and will continue to guide our expansion as we look to take on life after Brexit.
