A framework to implement lean six sigma in selected large non-manufacturing South African companies
Baring some limited exceptions, all large non-manufacturing organisations want to improve quality together with reducing costs, and the deployment and implementation of continuous improvement methodologies is commonly viewed as a daunting and sometimes even an impossible undertaking. Many organisations and their leadership fail to properly structure or support continuous improvement initiatives incorporating customer centricity, which ultimately doom them to failure. Business performance excellence programmes enables firms to provide a mechanism to identify and eliminate operational waste; enhance customer experience; and systematically increase profits. Thus, performance excellence has become a key indicator of a firm’s ability to achieve sustained profitability and competitiveness. This study has led to the development of a theoretical framework for effectively implementing and deploying an appropriately adapted Lean Six Sigma (LSS) in large non-manufacturing companies. It also creates a better understanding of the impact that an adopted Lean Six Sigma can have on the success of large non-manufacturing companies, and establish how effectively such organisations can implement the revised methodology, as measured against the said theoretical framework, thus to be able to make recommendations on how they can reduce cost, optimise their performance and become customer centric. A literature survey was done on Lean, Six-sigma and Lean Six Sigma to evaluate the history, benefits, and challenges during implementation, applicability to services oriented industries and the defining of the critical success factors required for effective implementation.The conceptual background from the literature review identified the research gap on which a theoretical framework for non-manufacturing companies was developed. Field-based interviews were conducted with the relevant senior personnel of four large non-manufacturing companies in order to complete the structured questionnaires to provide the data for understanding the mechanisms by which Lean Six Sigma deployment is addressed in the organisations. Fieldwork consisted of interviews with directors, senior executives, line managers and other staff that have in-depth knowledge of their organisation’s Lean Six Sigma deployment activities. These personnel members were selected on the basis of their direct decision-making and long-term involvement in their organisations’ continuous improvement activities throughout the assessment, negotiation and implementation phases. Detailed research on each organisation’s Lean Six Sigma activities preceded every interview. The interviews themselves were highly structured, and focused on the specific organisation’s Lean Six Sigma challenges on implementation and deployment of the method. The questionnaire was designed around the key factors needed in order to successfully manage Lean Six Sigma deployment challenges, as identified by theory and case studies and to test the degree of conformance to these theories by the four non-manufacturing companies. The findings in this study proves that, South African non-manufacturing companies are not adopting Lean Six Sigma to the point where it is going to make any sort of significant difference to the bottom line over a significantly meaningful period of time, judging from the statistical analysis from the survey results presented. The proposed framework provides for clearly defining the project infrastructure and methodology before the Lean Six Sigma project begins. This clearly helps to gain funding to embark on the projects, and will be helpful in any non-manufacturing company that must justify, as most do, how they spend the capital budget. The detailed cost/benefit analysis created during the implementation phase provides for the ability to gain funding for the implementation activities. People used to think of customer-centricity programmes mostly in terms of Customer Relations Management systems. Therefore, this research proposed a framework for management, supported by technology to become customer centric in a holistic manner. Many projects need not begin with any major technical investments. What matters more is a sustained focus on the financial goal and the transformation effort required to achieve that goal. Profitable Lean Six Sigma companies focus not only on integrating customer centricity into the organisation, but on ensuring that the entire “ecosystem” of the business - stakeholders, along with organisational processes, and structures - are aligned in ways that support Lean Six Sigma and customer-centric growth strategy.