For the past two decades, Accenture managing director Mark George has led Lean Six Sigma initiatives at more than two dozen Fortune 1000 companies. The CFO, he says, played a key role in all these implementations, which aim to achieve operational speed, quality, cost reduction and customer satisfaction.
“When the finance community truly understands the significance of the business improvement programme and they make it a priority, you typically find ways to rise to the top,” explains George, who has just published a book called
The Lean Six Sigma Guide to Doing More With Less. The relationship between finance and the team entrusted with business process improvement “can make the difference between an initiative that delivers mediocre incremental methods or one that can truly drive a change in business performance.”
George spoke to CFO Innovation’s Cesar Bacani about Lean Six Sigma and other business transformation initiatives, their relevance for companies that have returned to growth, and other issues around execution, productivity and agility in the finance function and the enterprise as a whole. Excerpts:
What is Lean Six Sigma and how does it help organisations?
Six Sigma has been around for literally decades. It is very powerful in stabilising a process, improving the quality of a process, making it more repeatable, more predictable and providing certainty of outcome on those things that are most important to the customer. But while Six Sigma is required, it is not sufficient.
There’s another powerful tool set that we married to Six Sigma, and that is the Lean tool set. First and foremost, Lean accelerates process speed and also allows you much higher levels of agility and flexibility to respond to changes in the environment, changes in the landscape, changes in strategy.
But while Lean focuses on speed and cost and agility, it really doesn’t do a whole lot for the customer or for quality. Conversely, Six Sigma doesn’t do a whole lot to help you in terms of agility and speed. So we believe that the marriage of Lean and Six Sigma is vital. We believe that Lean and Six Sigma should always come together, to drive simultaneous improvement in speed, in quality, in cost and agility. So that’s just a quick discussion of the tool set.
If Lean Six Sigma has been around for decades, why are you revisiting the topic today and even writing a book about it? Don’t companies know all about it by now?
Most or all of your readers will either be very familiar with a lot of these tools and concepts because they have literally been around for decades, or most likely, already will have some sort of continuous improvement, business transformation initiative, in place. This is not news. What is news-worthy is that a lot of research indicates that the vast majority of these programmes are either a) not successful at all, or b) are not delivering on the full potential to drive value for the organisation.
The Conference Board, [a global non-profit association of more than 1,400 companies], interviews hundreds of CEOs and division presidents on the top challenges they face. The number one thing that they come back with is excellence in execution. Productivity is also one of the top five concerns, along with speed and agility, and customer loyalty and customer focus.
What’s interesting in that research is that over 70% of the Fortune Global 1000 report that they have formal continuous improvement programmes in their business. Yet when you ask the CEO what he or she is concerned about, they’re concerned about the very issues that Lean, Six Sigma and all these methodologies are supposed to be improving.
One of the reasons why this is the case is that many organisations have put too much emphasis on tactical tools, because they’re easy to acquire. Learning the tools of Lean and learning the tools of Six Sigma is fantastically easy. You can go to the seminars, you can take the courses online, so a lot of organisations are operating under the misconception that these methodologies will drive significant value if you just train a lot of people.
2012, May 23 
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