In today’s troubled market scenario, we are experiencing something we never expected. Reputed organizations are struggling to run their business and keep their customers satisfied. More jobs are lost with every passing day and big companies are collapsing like never before. Making new investments for changing the business has taken a back seat. All of this symbolizes the big “R” meaning Recession. The key to survival is to somehow run the business until the economic scenario improves, but nobody can exactly say when that moment will come. If we carefully examine the scenario, it actually presents a very good opportunity for organizations that have practiced and adopted Lean Six Sigma to easily sustain in these difficult times and come out shining in the long run

Here are some of the key features of a Lean Six Sigma Organization that gives them a strong edge over traditional organizations during recession time

1. Focus on Waste Reduction

Constant pricing pressure and increasing competition coupled with diminishing consumer demand is constantly eroding organizational profit margins. The best way to deal with this situation is effectively cutting operational costs. While it sounds easy and many organizations can simply resort to lay off people, this not only leads to loss of employee trust but also creates an environment of fear and suspicion in which the overall employee productivity goes for a toss. This is not a healthy sign and might prove costly in the long run. Lean Six Sigma organizations on the other hand start to re look at everything they do and question why it must be done. Every process is analyzed to identify unnecessary wastes and non value added activities that consume cost, time and money but create little value in the eyes of the customer. Effectively removing the unnecessary process steps not only leans the process but also improves the cycle time and reduces the time to market. Processes need less resource to execute them which eventually leads to huge cost savings.

2. Pull based Production

With consumers tightening all unnecessary spending, everyone is buying only what is absolutely needed. It is difficult for an organization to make any product and create a market demand purely on the basis of advertising and marketing campaigns. Traditional organizations dealing with forecast driven bulk productions and relying on advertising to promote sales will face a tough challenge in the current situation. Lean Six Sigma organizations are demand driven and follow the pull mechanism. They do not maintain excess inventory and produce as per customer demand. This can effectively control operational costs and provides a much better chance to survive and sustain during recession.

3. Strive for Accuracy

Being in business during recession demands an organization to perform at its best. While every organization is trying hard to maintain its customer base, there are ten others trying even harder to steal them over. Customers realize this situation and they have become even more demanding. What used to be a delighter for customers sometime back has become a necessity now. Traditional organizations believe in delivering faster to the customer to stay ahead of the competition but many times this happens with a compromise on quality of output. Such organizations are reactive and inspection driven and have hardly invested in preventing defects in the first place. At a time when you have to operate with minimal resources and generate maximum output, they find it difficult to prevent defects from occurring and reaching to the customer which ultimately results in customer dissatisfaction and loss of business. Lean Six Sigma organizations on the other hand continuously focus on speed as well as accuracy. While there is a continual focus to speed up processes by identifying and removing wastes, at the same time there is a strong focus to uncover root cause of defects and make sustainable improvements. This not only reduces variability in processes but also creates more uniform output which is right for the customer each and every time. This helps in satisfying and exciting customers which is a key to survive the recession.

4. Effective Change Management

During recession, organizations need to be extremely agile towards change. They must improve the way they used to do business in good times in order to survive the current situation. Organizations that are used to do things in a certain way will face heavy resistance when they want to try out new things. Continuing doing things the old way or not being able to change quickly would make an organization go out of business very soon. Lean Six Sigma Organizations on the other hand have a strong focus on change management and their culture promotes process improvements. Every change is meticulously planned and executed via a structured communication, training and benefits management program. This ensures that all changes are accepted and adopted effectively and the organization gets aligned with the market place ahead of its competitors.

Conclusion

While the current times are dark, there is a bright sunshine waiting but only those who survive the darkness will witness the sunshine. This is a time which demands elimination of all inefficiencies and wastes. It is like what Charles Darwin has quoted – “Survival of the Fittest”. Those organizations which can not cope up will crumble and only the fittest will survive. Lean Six Sigma organizations are better equipped to deal with this situation. Truly speaking, they don’t have to do anything extraordinary but just keep doing what they do as a part of their organization’s process improvement culture to survive the challenging time and look forward to the future.