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May 8th, 2018

Lean and Industry 4.0

It has been said that Industry 4.0, or “The Internet of Things” or “increased automation”, depending on which you prefer is set to revolutionise the workplace.

Twenty years ago, we were told that children starting school at the time would be leaving university and going into jobs that weren’t yet invented. Now we need to adjust to the thought that today’s five-year-olds might not be emerging into a world of work at all, but one where most jobs are done by robots, algorithms and self-service check-outs, and they simply reap the rewards.

For those of us working today, and particularly those focussed on improving businesses in the here and now, what impact will this transition to a new way of working have on our projects?

What is the future for Lean Six Sigma in a world where production no longer involves people?

The one aspect of an improvement project which probably has the most to gain from manufacturing automation is data collection.

Every improvement practitioner knows that the quality of the data upon which improvements are based can mean the difference between success and failure. If you reach conclusions based on inaccurate or incomplete data then you risk implementing solutions which do not achieve your original objectives.

Employees working

Accurate and reliable data collection is easier to achieve in some working environments than others. A good example of where data collection is already built in to processes is call centres. By their very nature, call centres build up masses of data as they operate. You cannot have a call centre without automatically gaining information about where the caller is calling from, roughly why they are calling, how long the call takes, which operator answers it, and what day and time it happens. Call centres are not automated, indeed they are often very labour intensive, but the job the people are doing involves interacting directly with the data collection system.

Traditional manufacturing is a world away from this, because the jobs involve interacting with machines and raw materials. If you want to collect data on production processes you often find yourself resorting to tally charts, paper forms, stop watches and measuring wheels. These are all valid techniques of course, but they are all limited in terms of the volume of data that can practically be gathered. They also introduce a new potential source of variability in the data itself. Six Sigma offers us Measurement System Analysis, an excellent tool for establishing the accuracy of your measurements, but which may force you to launch a whole new project improving your measurement before you get back to your original objectives. If the predictions about Industry 4.0 come true, it’s here in the Measure phase that Lean Six Sigma projects could be revolutionised – automated processes could conceivably provide all the data for you, in real time, as the action takes place. If there’s no human intervention in the production process, there doesn’t need to be any in the data collection either.

Of course, you could argue that if automation is designed well in the first place, there will also be no problems in the processes either, so no need for improvement projects. The truth is that while the boundaries of a project may be entirely within production, the root causes of the issues very rarely are. Production teams have to shoulder some of the responsibility for the existence of waste, but shop floor projects always uncover issues elsewhere too, such as in Procurement, Planning, Design, Sales, with the suppliers and even with the customers.

Conclusion

Industry 4.0 may automate manufacturing and cause a huge, generation defining shift away from production in Western labour markets, but things will still need to be sold, designed, scheduled and delivered. There is a long-standing misconception about Lean that it only applies to the shop floor, when in fact Lean Six Sigma techniques have been successfully used for decades in industries that don’t even involve production, let alone in the non-production areas of industries that do. It seems we could be facing a new world in which the data automatically generated by production systems demonstrates their processes are fine, and Lean Six Sigma can be concentrated on the issues caused elsewhere in the Value Stream. If the future for improvement in manufacturing is increased data reliability and less scope for waste in production, then those five-year-olds may not be troubled by the challenges that have faced improvement practitioners for generations.

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Mike HortonMike joined Bourton Group last year building on a successful career in performance improvement with Air Products. He is a certified Lean Six Sigma Black Belt with nine years’ experience of leading hard benefit generating projects, across multiple functions of a large organisation. He has delivered numerous Continuous Improvement training courses, and coached colleagues at all stages of the Lean Six Sigma training process.

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