Nothing forces people to get religion more than a brush with death, and companies are no exception. Look at Hoffman, of
Anoka, Minn. When the telecom bust of 2001 and the aftermath of 9/11 hit, it forced the manufacturer of electrical enclosures to change its ways. Its management had to turn to Lean and Six Sigma manufacturing philosophies to keep the company profitable and able to continue doing business as a Minnesota-based manufacturer.

In Hoffman’s case, this blending occurred over time. The company had been dabbling in Lean Manufacturing for a few years before the recession and had seen some encouraging results in the few places that it had experimented with it. But it wasn’t until President Del Nickel had committed the company to the philosophy and worked to ingrain it thoroughly into its culture that the results became significant enough to make a difference.

Besides the series of successes and the continual stream of communication, there is another important reason that the employees supported the effort. “We’ve never fired somebody because of a Lean event,” notes Massimino. “We’ve always reassigned them.” This was important because the Lean philosophy’s kaizen problem-solving technique uncovered several over-manned operations during the study of bottlenecks. Not only did moving the extra employees to the bottlenecks and redistributing the workload improve morale, but it also reaped huge productivity gains.

The Six Sigma philosophy traveled a rougher road toward acceptance than Lean did. “People in upper management were concerned about taking our focus off the rapid improvement that Lean had been showing,” explains Massimino. “So we packaged it as a tool in the Lean toolbox. Once we eliminated the idea that we were converting to Six Sigma, there was much more acceptance of it.”

So Massimino counts all continuous-improvement activities as Lean events, even if the employees are really using Six Sigma tools. A good example is a kaizen event in a paint booth. The employees had already devised ways to reduce the time to change from one powder to another, but the coats of paint were occasionally too light in some places and required touch ups. So a week-long kaizen event was organized to solve the problem. “We called it a kaizen event, but actually applied Six Sigma tools, like design of experiments,” says Massimino.

The accumulation of successes in the paint booths, welding lines, and elsewhere not only cut operating costs dramatically but also improved other performance metrics. From 2001 to 2006, for example, productivity rose by about 40 percent, and inventory turns were about 40 percent faster. Customer warranty claims fell by almost 50 percent. Safety metrics improved by 22 percent. And all of these contributed to the most important improvement of all, a 30 percent increase in sales.

Philosophies intertwined

Experts are not surprised that Hoffman would build its continuous-improvement process around Lean principles. “It’s meaningless to talk about Lean Manufacturing without talking about Six Sigma and total quality management,” says Jay Jeffreys, at Wonderware, a Lake Forest, Calif.-based unit of Invensys Systems Inc. “You can talk about a car separately from talking about the engine. But a car without an engine doesn’t make sense.”

In a similar way, the Lean Manufacturing and Six Sigma philosophies are parts of a healthy continuous-improvement program. Yet, because Lean Manufacturing streamlines flow within a process and Six Sigma reduces variation, Lean Manufacturing provides a kind of superstructure and hence, usually precedes Six Sigma. “Lean is typically the best starting point for dropping the waterline so that the true landscape of projects is clear to all,” explains Dave Gleditsch, dean of the Demand Flow Institute run by DemandPoint Inc., a consulting and training firm based in
Englewood, Colo....