The lean movement is based on reducing waste and improving value-added activities. In lean manufacturing, for example, removing process bottlenecks and increasing quality eliminate waste and add value for the customer. Lean and six sigma are often utilized together to improve quality.
Lean is Learning
Key to a successful six sigma or lean event is learning from this cycle.
For example, a problem is defined or a hypothesis is proposed in the first step. Perhaps a raw material is suspected to be of low quality. In the next step, measurements and data are collected to verify or validate the hypothesis. Samples of the raw material are collected and measured for the quality component of concern.
Analysis can sometimes overlap the measurement step as it is often difficult to separate sampling and characterization. In the raw material quality scenario, the analysis may include specific components and ingredients or another variable such as weight or volume.
The final two steps of the six sigma methodology are where learning occurs. Improving may include solution of another raw material to test on tighter requirements in the purchasing system. The control step means to close the warning loop by documenting the data and information to either validate or disprove the hypothesis that was initially proposed (“define”).
Traditional Learning in Innovation Processes
Innovation processes normally follow a traditional staged and gated system. Work is done in stages and gate decisions are made to advance or kill the new product development (NPD) project. This structured NPD process is designed to minimize risk of investment for the inherently uncertain nature of new product development projects.
As a project advances through the various stages of work, the product design is verified with customers, technology developers, and operations. At each step of the process, the business case for the new product or service is validated against the firm’s strategy and customer needs. Typical NPD process stages are:
- Stage 1 – Opportunity identification,
- Stage 2 – Concept generation,
- Stage 3 – Concept evaluation,
- Stage 4 – Technical design,
- Stage 5 – Commercialization, and
- Post-launch review.
The formal post-launch review (PLR) is conducted after the new product is commercialized. Like a traditional project lessons learned review, the PLR probes the NPD team and its development process for what went right, what went wrong, and what can be improved next time. Additional PLRs will verify the product business case based on actual vs. planned sales (price, volume, and revenues) and expenses (manufacturing, marketing, and distribution).
Lean Learning Cycle
The lean learning cycle in innovation is particularly useful during the fuzzy front end of new product development (e.g. stages one through three). In the early stages of an innovation project, customers should be probed for needs, pain points, and problems with available product solutions. The lean learning cycle can accelerate needs identification for a new product development effort as well as improve the time-to-market by quickly testing various ideas with customers. A lean learning cycle aligns with six sigma methodologies:
- Define – identify customer needs,
- Measure – conduct ethnographic research,
- Analyze – use rapid prototyping,
- Improve – fail fast, and
- Control – validate product concepts.
Issues with Lean Learning
A major challenge to lean innovation is that while learning is key to success, documented lessons learned are rare. Because the lean learning cycle is meant to be fast and iterative, NPD teams may fail to formally document data, information, and knowledge from each cycle.
Post-launch reviews are imperative for long-term success of any innovation program, but are even more important for a lean learning cycle. Without a full analysis of the problem statement, data, and results, it is folly to advance to the next iteration.
Applying Lean Innovation
Remembering that lean is built on the theory of reducing waste and adding customer value, lean innovation is a natural fit for NPD teams. The lean learning cycle adopted from six sigma (DMAIC methodology) is especially useful for implementing during the fuzzy front end of a traditional, structured NPD process.
Lean innovation increases the focus on the customer during needs identification and in building product requirements. Additionally, rapid experimentation allows various product concepts to be quickly validated and improved. Lean innovation can lead to increased customer satisfaction and shorter time-to-market since product requirements are verified earlier in the process.
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