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Improving Supplier Delivery using Lean and Six Sigma

Written by: Jon Hansen

Article Overview: Member Question: Can anyone share their experience in improving Supplier delivery performance using Lean and Six sigma methodology?

Improving Supplier Delivery using Lean and Six Sigma

In a recent Q&A which asked the question Why Six Sigma Initiatives fail I provided a detailed response based on both research and practical experience.

Here is an excerpt from the resulting article:

At a Value Network Summit in 2007 Glenda Turner (a Supply Chain Integrator with Boeing) made the following statement; “Now that I know the value networks methodology, I would not consider doing a Six Sigma, lean or any other kind of project without first doing a VNA to provide the systems context for the initiative.”

Similar sentiments regarding the VNA methodology were also expressed by Stephen Slade (a Director at Oracle) as well as Dr. Henning Kagerman (Chairman and CEO, SAP).

This leads to an obvious question, what is a Value Network Analysis (VNA) and why is it being seen as the way of the future over Six Sigma, SCOR or for that matter any of the other current methodologies?

As indicated in one of my previous responses, when organizations such as Boeing refer to a complex adaptive network, what they are really discussing is using an agent-based model whereby the unique operating attributes of key stakeholders are first understood individually and then (through a collaborative effort) are linked collectively by establishing what they refer to as “flow paths.” This latter exercise is tied into identifying the common points of connectivity between seemingly disparate stakeholders (and stakeholder objectives). In essence, it reflects a theory of process I discovered and developed starting in 1998 and what I have come to call “strand commonality.”

Under the VNA approach for example, the term supply chain has been dropped and replaced with the more appropriate “supply practice” moniker. This is due to the fact that the former reflects a sequential thought process versus a synchronized approach that is more in line with the way in which the real-world operates. Leveraging the VNA’s synchronized “agent-based” model the unique operating attributes of diverse stakeholders both within and external to the organization are clearly identified and understood. The VNA methodology (and those like it) then seeks to develop an “adaptive” model whereby the prescribed “process” reflects and therefore adapts to stakeholder characteristics and objectives. “Adapt” being the key word.

Conversely, Six Sigma is reflective of the traditional equation-based models in which an attempt is made to establish a “set” chain of characteristics in which stakeholder adoption or compliance is a key component. The only commonality link between different stakeholders is a centrally established (usually myopic) standard or standards that do not necessarily reflect the real-world operating attributes of the organization or its external trading partners.

The above excerpt is a good starting point.

I have provided links to a 7 part series I wrote titled Dangerous Supply Chain Myths. Parts 4, 5 and 7 should be of particular interest. While the emphasis is on Supply Chain, the principles are applicable to all operational aspects of an enterprise. This will hopefully provide some additional insights into the factors that are reshaping the way organizations will operate in the emerging global economy.

If you would like to obtain additional information or other articles and papers on this subject please contact the author.

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Article Tags: adaptive network, collaborative effort, commonality, flow paths, glenda, henning, methodologies, moniker, practical experience, scor, sentiments, sigma initiatives, six sigma, stakeholder, stakeholders, stephen slade, supply chain integrator, thought process, value networks, vna



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