Achieving Organizational Excellence Through Lean Six Sigma

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Lean Six Sigma is a methodology that relies on a collaborative team effort to improve performance by methodically removing waste and reducing variation. With that intent, the Six Sigma Management Institute Asia (Six Sigma Asia) organized and presented Sri Lanka’s first-ever Organizational Excellence & Lean Six Sigma Conference to celebrate 30 years of Six Sigma and to tribute the Co-founder of Six Sigma late Prof. Mikel J Harry. Held on the 25th of May at Cinnamon Lakeside, the conference featured a number of key industry pacemakers and technical experts who shared their journey with Lean Six Sigma in various industry segments.

The first speaker for the day was Don Drury

Don Drury, Former VP of Merrill Lynch and CEO of SSMI USA addressed the audience on Lean Six Sigma in investment banking and the great discovery. Don started off by explaining what quality and business quality is. What is Quality? Quality is the realization of value entitlement. What is business quality? A state in which the customer and provider realize the mutual gratifying exchange of value. He spoke about concepts such as the velocity of value and the rate of change. He also shared his life experience as well .

He went on to explain that achieving a five Sigma level of performance in 5 years will dominate virtually any market in the world. Six Sigma practitioners are data hungry. You have to torture data to get the answers that you want. He then spoke about the great discovery. No, not America but something more. This was a way to empower an organization with the practices of Six Sigma.

Lean Six Sigma
Image Credits: Thisal Gunarathne

As practitioners of Six Sigma, you can harvest lost cash, expand product sales, increase customer satisfaction. Practitioners of Six Sigma include Nokia, Motorola, Ford, Sony, Samsung and Seagate.

The great discovery is Value. This has 3 components: Worth, Utility and Importance. If its missing any of these, it’s not a value. You must identify 3 values, then you must have something called a Catalyst. This powers you to reach your values. A catalyst must have a start. But there is a gap between these two. You also have milestones. Once you achieve milestones, you’re one step closer to the catalyst. There’s also a driving force and a restraining force.  You also must have checks and balances. This is the proven path to breakthrough. He then spoke of the steps taken for the great discovery.

The great discovery is a process that creates breakthroughs in everything that you do – Don Drury

Next up was the keynote address by the late Mikel J Harry

Titled “Creating Velocity of Value” this was one of the last recorded videos of the late Mikel J Harry.

Are you more concerned about the quality of your business or are you concentrating more on getting deeper into the business of quality? – The Late Mikel J Harry

We learnt about the Journey of Dialog Axiata with Lean Six Sigma

Sandra de Zoysa, CCO of Dialog Axiata was up on stage to talk about Dialog Axiata and their journey. She started off by giving a brief background about Dialog Axiata. Their quality and excellence journey began in 1999 with their certification of ISO 9002:1994, then in 2002 with the Asia Pacific Quality Award – Service category.

With regard to Lean Six Sigma, Dialog’s journey began in 2009. Fast forward to 2017 and they have achieved a total of LKR 1.89 Billion in cost savings. Sandra spoke about how Dumindu Ranaweera joined Dialog and how passionate he was about Lean Six Sigma.

She then went on to explain why Lean Six Sigma is important to Dialog Axiata. Sri Lanka is predominantly a pre-paid market and we have almost 50% to pay taxes. At the same time, we also have the lowest data rates in the world.

The years 2008 to 2010 were not particularly happy for Dialog. They were making losses and the also had a voluntary separation scheme for employees. They were looking for a way to make a comeback. The solution was staring them straight in the face: Lean Six Sigma. Sandra went on to speak about Engage, Enable and Excel. Engage every employee to contribute towards the company CRS drive, Enable and equip employees with the tools needed to embed Lean Six Sigma in culture, thereby excelling customer experience. This is particularly challenging with services such as WhatsApp and Viber as people don’t use traditional texting or calling methods anymore.

Things weren't looking up for Dialog in the 2008-2010 era (Image Credits: president.gov.lk)
Things weren’t looking up for Dialog in the 2008-2010 era (Image Credits: president.gov.lk)

She then presented 5 case studies. First up was a Contact Center Cost Optimization. Their problem was that the performance of the contact center was poor which in turn meant that there was poor customer experience, high staff turnover and high operational costs. With the use of Lean Six Sigma protocols, they managed to turn out the center to answer 90% of phone calls.

Her second case study was the reduction of transaction time of Dialog TV. A majority of transactions processed at retail outlets was for Dialog TV with average handling time for new connections being over 18 minutes. Again, by applying Lean Six Sigma, they achieved must faster turnaround times.

The use of Lean Six Sigma also helped Dialog improve turnaround time of their Customer experience enhancement, Point of Sales Material (where they had 50% reduction of cost for POSM printing, and distribution costs were reduced by LKR 2 Million and time reduced from 5+ days to 1 day. They also eliminated the need for storage and recycling.

She closed her presentation saying the importance of Lean Six Sigma and how important customer satisfaction is. Because of Lean Six Sigma, they were able to Improve operational efficiency, optimize resources, create a continuous improvement learn culture and reduce operational cost.

We then learnt the story of Nations Trust Bank and Lean Six Sigma

Presented by Renuka Fernando, Director and CEO of Nations Trust Bank (NTB), her presentation dealt with the introduction of Lean Six Sigmato NTB and how they adapted to it. Usually, banks are highly regulated and heavy on process. But Renuka and her co-workers realized that the customer experience was coming to this world. But because they were still a niche banks and still growing, their processes were stressed. In addition, larger banks in the country were also keeping rather fat margins, making things even more difficult for NTB to grow.

Lean Six Sigma
Renuka Fernando addressing the audience

In the year 2013, they consulted BCG for the adoption and implementation of Lean Six Sigma. They possessed no prior knowledge about this so they sought the assistance of BCG. In 2014 and 2015 they had a core team of lean operatives taking over the driving of lean processes and tools through some of the critical processes in the organization. Because they were moving into a new core banking system, there was only so much the consultants could do. Switching to a new core banking system is not a process that is often carried out and involves all of the employees and is quite hectic and stressful. Fast forward to 2017 and NTB is the first bank to go into robotics and also the first bank to successfully implement Lean practices.

It wasn’t about someone telling you what to do, rather you engage with people on the shop floor – Renuka Fernando

She then spoke about the challenges face by NTB when implementing these practices. Performance was key for them. They also had the problem that employees felt that Lean Six Sigma was a cost cutting method, thereby that they would lose their jobs. The next fear was quantifying the impact of their profit and loss, essentially fear of the unknown. As an answer and learnings, they addressed their fears head on. The staff was promised that their jobs would be safe. She dedicated the best resources she had to enforce Lean Six Sigma across the organization. They concentrated on quick wins or projects that could provide quick results.

She then went on to talk about the current standing of the banks such as account opening, cards production and SME credit, and how Lean helped them optimize their operations. The results; over LKR 59 million saved per annum because of a IMAD (I Made a Difference) programme. This is where employees, regardless of their position were given a goal of implementing processes that would save LKR 100,000 in costs.

We learnt about the importance of culture in driving organizational excellence

This took the form of a panel discussion. The panel consisted of the following members:

  • Ajantha Dharmasiri, Director, COB of Management of PIM, Adjunct Faculty in IHRM – Price College of Business, University of Oklahoma USA
  • Anna Grabowska, Founder of Service Process Excellence Network and Go4SixSigma
  • Don Drury, CEO of SSMI former VP of Merrill Lynch
  • Ashok Sarkar- Faculty, Indian Statisical Institute
  • Ken Vijayakumar, Director HR Waters Edge, Director Talent Enrich, Hony. Secretary IPM (moderator)
Lean Six Sigma
Image Credits: Thisal Gunarathne

Sri Lanka, by and large is not a country accustomed to change. The same hold true for implementing Lean Six Sigma to an organization.  People are mostly looking for WIIFM or What’s in It for Me. People like change as an idea, but they are scared of the experience. This was the view ofProf. Ajantha Dharmasiri. They went on to discuss that you should start with the small steps.

Culture eats strategy for breakfast, it eats structure for lunch – Peter Drucker

Culture plays a critical part especially in countries such as Sri Lanka. You can’t impose strategy onto people without affecting their culture. Strategy should be implemented in a way that people would like to be involved in it. The culture should be supportive in adapting to the new strategy. This is where Lean Six Sigma comes in, essentially bridging the gap between culture and strategy. With regard to millennials, the moment you show importance to a process, you risk your employees getting scared for their jobs.

Nokia being a Six Sigma company crashed. Why? The answer is Evolution. With the absence of a continuum in their strategy, Nokia drifted from the original plan because of leadership changes. Nokia also possibly missed the point of the customer, thus failing. Giving preference to the voice of the process as opposed to the voice of the customer is also not ideal.

We learnt about the use of Organizational Excellence Strategies from Ashutosh Pandey.

He started off by explaining how Nokia’s theme of Connecting people changed to creating technologies for the connected world. His example was a case study of one of the leading telecom operators in Asia.

Lean Six Sigma
Ashutosh Pandey addressing the audience
Image Credits: Thisal Gunarathne

He spoke about elements such as patents and acquisitions. Ashutosh’s session was quite technical where he explained and spoke about brown paper or value stream mapping. From there, he went on into great detail about the steps taken for things such as the scope, baseline and validations. He also spoke about process breakpoints and mapping break points to capability methodologies.

After lunch we had Dushan Soza speaking to us

Dushan, the director of BPM One, Softlogic and former CEO of WINS addressed the audience on the importance of organizational excellence and Lean Six Sigma shared services.

He started off my explaining what shared services is. In a nutshell, this is the consolidation of business operations that are used by multiple parts of the same organization. Dushan defines Lean Six Sigma as a structured way of solving a problem. It has five steps: Define, Measure, Analyze, Improve and Control.

Lean Six Sigma
Dushan Soza addressing the audience
Image Credits: Thisal Gunarathne

Dushan then went into a case study about AP transaction volumes. Lean Six Sigma essentially analyses your data and cracks it down to identify productivity and waste. His next case study was to identify overall ranking. Another one was providing transport to drop employees home after a night shift. The problem here was that the cost of dropping an employee per day per month was LKR 9000. The second problem was that employees were dropped after 12AM. With the application of Lean Six Sigma, per head cost dropped by 60% and every employee was dropped before 12AM.

Dushan’s last case study was a personal example of when he went to London in the early 80s. He was a cricketer who found himself needing some local food. He sent an aerogram to his mother who replied saying to “master the egg”. This was where if you could master the boiling of an egg, you would have unlocked the secret to cooking. Through trial and error, Dushan went from boiling an egg, to boiling rice. Through a number of experiments, he was able to have a 50% reduction in cycle time, and also a 50% reduction in electricity wastage when using an electric boiler for both the egg and rice.

We then learnt how Ferrari won 8 World Championships

Presented by Dr. Fabrizio Majorana, the former Quality Director of Ferrari and Maserati and also the Executive Director of SSMI Europe, the presentation was pretty self-explanatory. The aim of the team at Ferrari was simple: Win races and championships. Of course this also implied that you had to have the fastest car and also have a higher reliability. This also meant that you have to win the championship because just winning the race doesn’t mean you win the championship. They had to be the fastest in development, logistics etc.

Lean Six Sigma
Dr. Fabrizio Majorana addressing the audience
Image Credits: Thisal Gunarathne

Dr. Majorana spoke about how technologies such as X-Ray, endoscopy and roughness were all affected by Lean Six Sigma and how it helped improve its efficiency. He then spoke about some Lean Six Sigma projects such as tire performance and computation, refueling optimization, assembly engine tolerances and engine weight. All of these helped improve the efficiency and performance of their cars, thus leading them to victory.

We learnt the use of ISO 18404, 13053 – 1& 2 Lean Six Sigma Standards from Dumidu Ranaweera

Just like ISO 9001, ISO has come up with a standard for Lean Six Sigma which is ISO 18404. Dumidu’s presentation revolved around the steps needed to implement it to get the standard. Dumidu spoke about ISO standards and how Lean Six Sigma received its ISO 18404:2015 standard. He then went on to talk about the different colors and belts and the required certification systems require for each. You can read more about them here.

Lean Six Sigma
Dumidu Ranaweera addressing the audience
Image Credits: Thisal Gunarathne

He also spoke about steps for adopting ISO 18404:2015 standard and also the key implications if adopted. As a finale to his session, Dumidu launched the Lean Six Sigma and Yellow Belt program in Sinhala.

Next up was a Panel discussion about Organizational Excellence in ICT

After a spot of tea and some networking, we were back in the hall for another panel discussion. The Panelists were:

  • Mano Sekeram, CEO & Co-founder of 99x Technology
  • Asoka Korale, Senior Tech Consultant MillenniumIT, former VP at Amba and Research Engineer at Motorola UK
  • Ashok Sarkar, Head Indian Statistical Institute Mumbai
  • Dr Fabrizio Majorana, former Quality Leader Ferrari, Maserati and UniCredit group, Executive Director SSMI Europe, Author – Lean Banking
  • Chandana Ranasinghe, COO & Co- Founder of Auxenta (Moderator)
Lean Six Sigma
Image Credits: Thisal Gunarathne

The discussion touched on several important factors such as the competitiveness in a company. This is what is most important. Disruption and innovation is equally as important as operational excellence. You must have leadership commitment. The most important thing you can do is to deliver a product with 0% defects. Lean Six Sigma would help you achieve this to constantly measure, learn and reduce cycle time. An interesting question was how to balance agile models with Lean Six Sigma. It depends on the maturity of the company and what process is important at the time.

What about Lean Six Sigma in Healthcare?

This was the topic of Marcus Sorensen who was the last speaker for the day. Marcus, a Master Black Belt, Storm – House of Six Sigma spoke about the simple mosquito net. At the time of his employment, he spoke of an example where a company got an order for 700,000 mosquito nets to ship to Kenya. But since they didn’t have proper quality control measures in place, there was a product defect and it was rejected, Marcus was then hired to manage the Quality Control of the company in India.

Lean Six Sigma
Marcus Sorensen addressing the audience
Image Credits: Thisal Gunarathne

Through the use of Lean Six Sigma and DMAIC, where he explained each step in details, Marcus explained how you should understand your customer, set a target, use a structured approach, use proper data, and to analyze the problem without jumping directly to solutions.

With that, the Case Studies and presentations came to an end

It was then time for the Graduation ceremony and a Raffle draw with a number of prizes. Dumidu Ranaweera was back up on stage to deliver the Vote of Thanks. He thanked all those who helped out in all ways and manners. With that, the first ever Organizational Excellence & Lean Six Sigma Conference came to an end.

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