LEAN 6 SIGMA &

PROCUREMENT

PURPOSE – PROCESS – PEOPLE

LEAN METHODOLOGY IS FOCUSED ON ELIMINATING WASTE

TYPES/FORMS OF WASTE:

Transportation

Inventory Motion Waiting

Overproduction

Overprocessing

Defects

SIX SIGMA IS THE HIGHEST LEAN STANDARD

FOCUSED ON LOWERING VARIATIONSTO 3.4 DEFECTS

PER 1 MILLION OPPORTUNITIES

Example: In a manufacturing setting, for every 1 million products produced ONLY 3.4 items are produced with a defect.

A commonly used methodology to achieving the 6 Sigma standard in

existing business processes is:

D M A I CDEFINE MEASURE ANALYZE IMPROVE CONTROL

DMAICDEFINE the project goals and customer deliverables.

MEASURE the process to determine current performance.ANALYSE & determine root causes of the defects.

IMPROVE the process by eliminating causes of defects.CONTROL future process performance.

Table and ChartLEAN 6 SIGMA APPLIES MAINLY

ON OPERATIONS

Procurement, being at the core of operations,

plays a vital role in achieving lean 6 sigma standards.

Images Womack & Jones, authors of Lean Thinking, recommend that managers embark on lean transformations through the use of the

3 Ps: PURPOSE PROCESS PEOPLE

ImagesPURPOSE OF LEAN IN PROCUREMENT IS TO..

Minimize time and effort required by

procurement processes. Minimize the risk of variations in process

and costs. Maximize efficiency and performance

levels.

LEAN IN PROCUREMENT PROCESSES

RequisitionsRequests (RFQ/RFP)Purchase OrdersContractsOrder ReceiptsInvoice Payment

Processes include: Minimize waste within procurement processes that could occur in:

• TRANSPORTATION• INVENTORY• WAITING• DELAYS• OVERPRODUCTION• OVERPROCESSING

Use the DMAIC method to minimize defects within all processes.

LEAN & PEOPLE IN PROCUREMENT

Approved suppliers list: single source of up-to-date data & KPIsItems Catalogs: single source of up-to-date data & KPIsPre-set templates with auto-fill features.Automated order approval routing.

Technology to Empower People

Budgets: control spending, and avoid maverick spend.Reports: measure, analyze data, and improve.User Permissions: full control over the process and access rights.Structured workflow to streamline processes.

Technology to Manage People

& LEAN 6 SIGMATradogram takes the 3 Ps approach by:

Automating your procurement processes from end-to-end.

Minimizing effort and risk to improve efficiency and performances.

Ensuring that all communication with all stakeholders (internal & external) is streamlined and well documented.

Utilizing advanced cloud technology to ensure that you have the right amount of control, while giving everyone access to a

centralized system.