The Application Study On Lean Six Sigma In Production Cost Reduction In Company L

Lean Six Sigma is an advanced production method is being introduced by more andmore companies, some of them from manufacturing industry; some from service industry.Different industries are using Lean Six Sigma to improve their production process, serviceprocess. Though the focused objective different, but they have the common goal, that is useLean Six Sigma to eliminate waste, reduce cost, satisfy customer, and enhancecompetitiveness.Lean Six Sigma is an advanced production method that combined the advantage ofLean Production and Six Sigma. The advantage of the twos was fully shown in Lean SixSigma. Lean Production is from Toyota Production System, the concept of lean is focuswaste, especially the process stagnant waste. The purpose of lean is to eliminate processbottleneck and speed production, reduce lead time, and achieve waste eliminate. Six sigmais from Motorola, which more care process variance and quality in process improvement.Sometimes only uses one of them also can get big benefit, but they have their ownemphasis focused, none of the twos can both care speed and quality. So Lean Six Sigmawhich can satisfy the market’s requirement, and can care speed and quality at the sametime.L Company is a typical high tech company, in the years that it newly founded, it hasstrong competitiveness for its high technology, and the market of it was No.1. But with thedeveloping of local competitor breakthrough the technology bottleneck, they are more andmore strong; the market share of L is smaller. The cost of L Company is much higher thanlocal ones. So L introduced Lean Six Sigma and wants to reduce operation cost andenhance competitiveness.This paper combined domestic and overseas theory study of lean production, six sigma,lean six sigma, and introduced concept, history, development, and related tools of them.Based on the theory study, six sigma DMAIC improvement model and combine the regularused tools and designed implement plan. In the implementing of this plan, based on thevoice of external customer and internal management requirement, identified the productioncost issue that L Company facing. After breaking down this issue by data analysis and leantools, the improvement direction was identified. The root cause of the issue was verified by six sigma tool, and the issues were resolved based on the root cause. Finally, the projectachieved the target, resolved the production cost issue of L Company. The researched objectis apply lean six sigma to resolve the production cost issue in manufacturing companies,this research is in a strong representative and strong practical significance, also strongpractical operation, and good reference for more companies who are implementing lean sixsigma.