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Managing Change In The Manufacturing Revolution

It’s an exciting time to be in manufacturing, but that means change in the industry — and lots of it.

Mnet 47926 Mike Dileo

It’s an exciting time to be in manufacturing, but that means change in the industry — and lots of it. The existing and emerging technologies that are creating a new Industrial Revolution in the manufacturing sector are also creating new demands for leadership in change management skills, metrics and more.

As tech innovation is driving business decision-makers to be more effective in a rapidly changing and competitive environment, they’re seeking more professional certifications to support their ability to excel. While the need for professional certifications likeSix Sigma is true in a wide range of industries — health care and retail among them — it’s in the traditional “home” of Six Sigma, in the manufacturing space, that the investment in leadership skills and the analytic Six Sigma framework are likely to pay off.

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Consider some of the developments identified by Industry Week as the Top 5 manufacturing trends to shape the 2015 market. At the top of the list is the so-called “SMAC Stack,” the next-generation IT approach designed to streamline social, mobile, analytics and cloud into a single architecture that delivers what Ed Anderson, a research VP at Gartner, has called a digital critical mass. SMAC Stack changes the manufacturing game, but these customer-focused trends force what Michael Kotelec at Verizon views as “cultural change within a historically conservative ‘if it ain’t broke don’t fix it’ industry.”

Innovation Drives Tech Adoption, Leadership Demands

At the same time, the nascent Internet of Things and related automated processes are expected to drive efficiencies. But, as Jeff Reinke explores in a June post here for Manufacturing Business Technology, that creates fear of the unknown at the same time that the impulse to seek solutions also drives innovation.

“These same fears can create an enterprise-wide state of paralysis that prohibits the integration of potentially game-changing procedures and technologies,” writes Reinke, editorial director for MBT. Much of that inertia is because of a skills gap reflected in the lack of knowledge about IT integration, how to assess time-saving efficiencies and other process values, how to make data-driven decisions.

It borders on overstating the obvious, but that’s where Six Sigma certification becomes as attractive as a college degree rooted in STEM education — or in some cases, no degree at all. To reflect on the history of Six Sigma’s quality and customer-focused philosophy, its initial applications at Motorola and later its wider adoption in business, notably at GE, is to realize how closely aligned the Six Sigma model is with the data analytics, the eye on efficiencies, and ultimately the quality-driven and customer-centric view.

It might even be argued that Six Sigma practices and their role in shaping corporate goals have, since the 1980s, demanded that industry hew to the results-driven improvement processes — and now, the IT trends that shape manufacturing — that are answers to the performance questions that Six Sigma gave birth to in the first place. In any event, says Reinke, the focus on process and meaningful assessments, on team-building and leadership, is how manufacturing needs to move forward in a new IT ecosystem.

“IoT is meant to have far-reaching impacts, so developing cross-functional teams that can contribute ideas on where to start, where to invest and how to most accurately measure results on several fronts would produce the greatest impact,” he concludes. “This level of contribution could lead to a quicker implementation, easily identifiable initiation points and a quicker ROI.” Plus, it mitigates fear of change.

Six Sigma Investment Pays Off in Results

What Six Sigma and other professional certifications do is build that hands-on, project-management team designed to manage change in manufacturing. The emphasis on metrics, and the Six Sigma training designed to help leaders identify meaningful data and act on its solid analysis, isn’t just about IT though.

Nor is there a uniform, rubber-stamp approach — even in manufacturing — that allows business leaders   to simply learn basic statistical models and standard deviations, plug them into design, and go to lunch assuming that new process efficiencies, cost reductions and ROI-related benefits will be there when they get back. The real value of Six Sigma training lies in the professional development of corporate and team leaders, whose applied Six Sigma expertise is reflected in ideas and strategy rather than any formulas.

An investment in critical thinking — and confident process management for manufacturing — may not seem like it fits neatly into a cost-benefit analysis form. But there is quantifiable value, despite the use of Six Sigma in a wide range of verticals and with multiple variables in projects, timelines and people.

One graphic, available at Industry Week, puts the ROI on Lean Six Sigma training provided in the U.K. at a 40 percent average savings among companies who adhere closely to Six Sigma implementation. Some businesses – those who are firm in their DMAIC methodology and require their high-level Black Belts to produce results in order to be fully certified — see even more robust returns, and the investment on those Black Belts is a 7:1 cost-to-savings ratio. That’s 5:1 for Lean Green Belts, and for Lean Yellow Belts, who need basic concepts to participate as project team members, there’s a 3:1 cost-to-savings ratio.

Even the Six Sigma basics are important because, across the manufacturing enterprise and regardless of its size and complexity, it’s still people who are being asked to consider new ways of doing business. The buy-in of their leadership, and especially C-suite executives, is the key to their success as they adopt the technology-driven changes that shape the routines of their workdays and their overall corporate culture.

As manufacturing continues its evolution — driven by global consumers, and the increased visibility and flexibility they demand — industry professionals are meeting the challenge. It is an exciting time, and that does mean a lot of change. For professionals and their companies who make the investment in Six Sigma and other project and change management certifications, that’s a rich future they’re ready to flourish in.

Mike DiLeo is Operations Director with the Management and Strategy Institute.

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