Ways to Save Your Company Money with Lean Six Sigma
Last Updated May 3, 2019
Deploying process improvement will most likely cost your company money. This is a fact that prevents some organizations from embracing the proven process improvement methodology. Regrettably, many companies perceive it as being simply too expensive to implement.
While it’s true that it can cost companies thousands of dollars to successfully deploy Lean Six Sigma and inject it into company culture, cost shouldn’t be the only consideration. Companies contemplating the implementation of process improvement methodology are better served by asking, “Does Six Sigma’s benefits outweigh its costs?”
Calculating both the costs and potential benefits of employing Lean Six Sigma principles helps companies put price resistance into perspective.
Here are some of the potential benefits of successful Lean Six Sigma implementation.
Increased Revenue – Lean Six Sigma eliminates variance and waste and helps processes run more efficiently. Organizations that employ Six Sigma principles are able to sell, manufacture and deliver more products and services of a higher quality while using fewer resources – the definition of enhanced productivity.
Decreased Costs – Production costs drop when Lean Six Sigma is applied to inefficient processes. Six Sigma practices help reduce defects and errors in the production process and decrease rework that consumes time and company resources without adding value. Six Sigma techniques also help to remove unnecessary steps from the production process. Six Sigma has helped many organizations radically cut costs.
Increased Customer Satisfaction – Customer satisfaction is at the heart of Lean Six Sigma. One of the first steps that a project team takes is determining how the customer is impacted by quality issues. The team then identifies critical elements that the process may require to increase customer satisfaction. Connecting process improvement with customer satisfaction helps ensure that using Six Sigma principles will create customers who provide repeat business and generate positive word-of-mouth. These factors can increase sales and profitability dramatically.
Employee Transformation – Once employees understand Lean Six Sigma principles and learn how to use them, they may never be the same again. Six Sigma certification helps employees see themselves as problem solvers and see defects as opportunities for improvement.
Training key employees in Six Sigma equips your organization with the knowledge and resources to constantly battle defects in the production process. Widespread Six Sigma training helps inoculate companies against product defects and quality errors.
Competitive Advantage – When Lean Six Sigma principles are working as they should, your organization can produce higher quality goods and services at a lower cost and quite possibly make you better at meeting your customer’s needs. These benefits of implementing Six Sigma can gradually accumulate to help your organization stand apart from the competition.
Evaluate the cost of training your employees in Six Sigma. Then compare the benefits of implementing Six Sigma principles – reduced costs, increased profits and higher quality. You will likely find that the potential benefits can far outweigh the costs.
