Lesson 1: What Lean and Six Sigma Are and Where They Came From

Why this course starts with history

Lean and Six Sigma are two improvement methods that grew up separately, on different continents and for different reasons. Most organisations now combine them. You will lead projects better if you know the problem each one was built to solve, because the first decision on any project is which kind of problem you have.

Across this course you will work through one running project:

• Organisation: a mid-sized distribution warehouse that ships spare parts to repair workshops.
• Complaint: customers say orders arrive late, and some arrive with the wrong part or quantity.

In later levels you will define, measure, analyse, improve and control this process. In this level you only learn to tell the two kinds of problem apart.

Lean: from the Toyota Production System

Lean comes from the Toyota Production System (TPS). The Lean Enterprise Institute defines TPS as the production system Toyota built "to provide best quality, lowest cost, and shortest lead time through the elimination of waste."

The main dates:

1. Early 1900s: Sakichi Toyoda, founder of the Toyota group, fitted his automatic looms with a device that stopped the loom whenever a thread broke. This idea is called jidoka: stop as soon as something goes wrong, so defects are not passed on.
2. 1930s: Kiichiro Toyoda, his son and the founder of Toyota's car business, developed just-in-time (JIT): make only what is needed, when it is needed, with no excess inventory.
3. 1950s–1960s: Taiichi Ohno, Toyota's chief of production after the Second World War, developed these ideas into a full system and spread it through the plants and then to suppliers.
4. 1988–1990: MIT researchers studying car plants around the world gave the approach its Western name. John Krafcik introduced the term "lean production" in a 1988 article, and the 1990 book The Machine That Changed the World made it widely known.

Just-in-time and jidoka are still described as the two pillars of TPS.

Lean in two sentences: Lean improves the flow of work to the customer by removing waste, meaning any activity, wait or stock that the customer would not pay for. It aims to shorten lead time and cut cost by making work move smoothly, without queues, rework or excess inventory.

Six Sigma: from Motorola

Six Sigma began at Motorola in the mid-1980s. Engineer Bill Smith is usually credited as its main architect. He used statistical analysis to find and remove the causes of defects by reducing variation in processes. CEO Bob Galvin backed the work, and Mikel Harry is also credited with developing it. Motorola won the Malcolm Baldrige National Quality Award in 1988. The method became widely known after Jack Welch made it a core initiative at General Electric in 1995.

The name comes from statistics. Sigma (σ) is the symbol for standard deviation, a measure of spread. A process that performs at "six sigma" is usually quoted as producing about 3.4 defects per million opportunities (DPMO). That figure includes a 1.5-sigma allowance for long-term drift. You will calculate sigma levels and DPMO yourself in the Measure levels.

Six Sigma in two sentences: Six Sigma improves the consistency of a process by reducing variation, so that outputs reliably land within what the customer needs. It uses data and statistics to find the causes of defects and remove them.

Telling the two problems apart

Ask these questions about any problem:

• Mainly waste and flow (Lean)? Work waits in queues, moves too far, is done twice, or piles up as stock. The output is fine but slow or costly. Example: orders sit in a tray for four hours before anyone picks them.
• Mainly variation and defects (Six Sigma)? The output is sometimes right and sometimes wrong, and nobody knows why. Example: pick weights or quantities vary, so about 1 in 200 orders ships the wrong quantity.

An analogy: Lean asks "why does this journey take so long?", and Six Sigma asks "why do we arrive at a different place each time?" Many real problems involve both. Start by naming the dominant one.

What both approaches share

Both approaches share these principles:

1. Customer focus: quality and value are defined by the customer, not by the department.
2. Data-driven decisions: you measure the process before you change it and act on evidence, not opinion.
3. Process thinking: results come from processes, so you fix the process rather than blame people.
4. Continuous improvement: improvement is ongoing and structured, not a one-off fix.

Task: classify the warehouse problems in Excel

Do this now:

1. Open a new Excel workbook (Minitab users can use a worksheet in the same way). Name the sheet L1_Classify.
2. In A1:C1 type the headers Problem, Your type, Answer.
3. In A2:A7 enter:
   • Orders wait 4 hours in the print tray before picking
   • 1 in 200 orders ships the wrong quantity
   • Pickers walk to the far end of the warehouse for fast-moving parts
   • Label printer sometimes prints a wrong postcode
   • Three weeks of stock of slow-moving parts on the shelves
   • Packing time ranges from 2 to 25 minutes for identical orders
4. In column B type Waste or Variation for each row.
5. Enter the answers in C2:C7: Waste, Variation, Waste, Variation, Waste, Variation.
6. Check your work: in E1 enter =SUMPRODUCT(--(B2:B7=C2:C7)). A score of 6 means every row is right. For any mismatch, re-read the questions in the section above.

Certification note

Several bodies certify Green Belts, including ASQ, IASSC and CSSC, and their syllabi and requirements differ. This course prepares you to apply the method. Before you book an exam, check your chosen body's syllabus.

Key takeaways

• Lean comes from the Toyota Production System. It removes waste and delay so work flows, and its two pillars are just-in-time and jidoka.
• Six Sigma comes from Motorola in the mid-1980s (Bill Smith). It reduces variation and defects using data, and six sigma performance is usually quoted as 3.4 DPMO.
• Slow or costly but correct output points to Lean. Inconsistent or wrong output points to Six Sigma.
• Both approaches share customer focus, data-driven decisions, process thinking and continuous improvement.