Creative ROI vrs. the best lean six sigma book…

Recently a colleague forwarded this email from a friend of his and asked me for my comments:

Please let me know what lean/6sigma book you would recommend. I’ve read a couple over the years but they are a bit dull and won’t fire up our management – is there one that is simple but convincing?

You’d be surprised how hard it is to get their heads out of the sand. Part of the problem is that we are so successful and dominant in our field.

e.g. At a major meeting last week, the exec responsible for customer satisfaction presented data to show that our competitor is the leader in terms of quality and customer satisfaction. He actually said “we don’t want to copy THEM because their margin is lower than ours so their quality is costing them money”. That’s how dumb and simplistic we are.

My response:

The problem you’re facing is way too common, and I don’t think there is any pill you can give your CEO to adjust his attitude. This isn’t what you want to hear, but until your CEO’s hair is on fire, I don’t think there is any book that will make a difference.

If you can find some smoke somewhere above the hairline, and then tie that back to quality and customer satisfaction, you might get somewhere. Sadly there is usually a huge disconnect between the ceo/finance function and quality/performance. Here is an true example:

I’ve been working with a customer (an electronics firm) on a data collection/analysis project. A bright Six Sigma Black Belt proved a direct correlation between the statistically significant variation on a handful of test results and out-of-box failures at the customer’s site. These were units that met specifications on well over a thousand tests, but still failed out of the box. Those OOB failures were threatening the contract: the customer was ready to pull the business.

We put together a proposal using SPC software to capture the signals so engineers would know immediately when they had a unit that was statistically different than the others (even though it still passed all the tests). It was a beautiful solution and everyone was really excited about it.

To sell that proposal to upper management my contact bypassed the (to me) obvious argument that identifing statistically significant variation would isolate defective units, which protects the customer from receiving bad product, thereby saving the contract.

(I can hear all the MBBs in the audience saying I’m not really using statistics right, but they were doing 100% testing here so pardon me.)

Instead my contact framed the proposal around faster product release cycles and the impact that would have on inventory turns. By having real-time data as the units were produced, he argued that they would be able to release production lots from WIP to Inventory 3 or 4 hours earlier. That was an argument that got the finance guy and the CEO excited.

I tell this story because it is an example of how a creative (read politically savvy) middle manager pushed through his agenda for quality process improvement using language that any  CEO understands. No book on SS or TQM or anything else would accomplish the same thing.

So look for smoke above the hairline. Something is keeping your CEO awake at night, and unless it is his girlfriend, you can probably tie it back to quality and customer sat.

Hope that helps, and best wishes.

Regards,

Evan

Even though the CEO and CFO didn’t care, in the first 10 days of the pilot project, GainSeeker real-time SPC software trapped two defects that the test process couldn’t catch. My contact reported: “Three defects in a year is enough to knock us out of ‘Preferred Vendor’ status. Anytime I stop two defects from getting to this customer, I’m a happy man.”