How Much Control Do You Have in the Vertical Value Streams?

Let's say you are faced with a significant purchasing decision of a new automobile. The cost of a new car can be a five year monthly payment commitment so it is a significant investment when you consider the proportion of your average working tenure and yearly take home salary. Which selection criteria are most important to you and do you use a scientific method for selection related to these criteria? The answers are most likely cost, gas mileage, safety, reliability, warranty, fit for purpose, etc. but most likely no for the latter. We as consumers cannot obtain the needed data for our purchasing criteria. We have to make this significant decision on either one data point (For example gas mileage displayed on window sticker) or consumer reports. This lack of data frustrates many Lean Six Sigma practitioners but it is, for the most part, outside of our control.



Now let's go inside the procurement process within the organization we work for and let's say the organization has to make a significant decision on selecting a vendor for a known Critical To Quality (CTQ) input. The CTQ input in this example is adhesion achieved from glue. As a Lean Six Sigma practitioner within your organization do you have any control of involvement in the procurement process? In the example I have provided do you know if the Purchasing department is using a scientific method as part of the criteria for vendor selection? As we all know there are department silos and I have seen organizations where the Purchasing silo has no idea the organization is using Lean Six Sigma. Even if they do they have determined Lean Six Sigma applications are limited to the shop floor. Getting back to the example, it is absolutely critical to apply a scientific method in this vendor selection. There must be a test outline request sent to each vendor, a single "window sticker" data point is clearly not enough, especially for this known CTQ input. The analysis must include histograms, analysis of variance, and p-value; all becoming part of the selection criteria. Of course cost is part of the selection criteria but including a scientific method can certainly move cost down the priority list.

Within your organization you do have more control to use the scientific methods you were trained for than the provided car purchase example. You are able to ensure poor decisions are not made. You are able to protect the organization's customers. You are able to be a significant input in providing a competitive advantage. Take control and get involved with the vertical value streams.