Originally developed to improve manufacturing efficiency and quality, Lean Six Sigma is now being widely adopted by financial institutions, retailers, hospitals and other corners of the services industry.
Lean Six Sigma is a blend of two concepts: Lean Manufacturing, which is aimed at reducing waste, and Six Sigma, which helps companies reduce errors. Together they can help companies reap the benefits of faster processes with lower cost and higher quality. From our research and experience with clients, we've learned that despite its growing popularity and impressive results at some companies, Lean Six Sigma often fails to deliver expected results. Our recent management survey of 183 companies found that 80% are not achieving their expected value from Lean Six Sigma efforts, and 74% are not gaining the expected competitive advantage because they have failed to achieve their savings targets.
Bain has developed an upfront diagnostic X-ray that enables companies to identify and focus on only the process changes that will quickly make the biggest differences ensuring faster results with smaller initial investment. The approach begins with understanding the company's value stream, and then moves rapidly to mapping out processes and costs. Next, we identify a company's full potential through such measures as bottleneck analysis and internal and external benchmarking. Finally, we target areas for improvement, unleashing the trained teams. Bain's diagnostic approach has enabled cost savings totaling many millions of dollars through process improvements.
Our experience across industries and geographies allows us to quickly perform diagnostics that help companies achieve sustainable improvements. Using the diagnostic X-ray to focus on areas with the most potential for generating results, our clients avoid the extra cost and time of training and deploying more teams than absolutely required.
We are pragmatic in our use of Lean Six Sigma. We use only the tools that make the most sense for each situation. Also, we partner with the right suite of third-party companies to deliver the right tools and solutions that best meet our clients' economic needs.
To find out more about Bain's work in this capability area, please contact the practice.
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