By 2004, cost savings at the company was $1.55 billion. The organization followed increased efficiency in teams, with empowered employees and enhanced careers. Dell’s customers really benefitted through a much better customer service experience through the cost and time it took to get their computer.

Based in Austin, Texas, Dell had its heyday from 1997-1999, when its revenue went up from $7.8 billion to $18.2 billion. It seemed everyone had a Dell computer, and the company was a true darling of the business world. Since they implemented the Six Sigma methodology, they saved $1.55 billion, and that’s when they were already extremely profitable.

Cutting down on waste and turn-around time and listening to what customers needs are is how they are among the top companies worldwide. Today Dell is worth well over $54.9 billion dollars, and they among the most admired companies in the world. Their customer service ranges among the very best in the industry.

How Dell Improved Their Processes

BPI is a big part of their strategy, which they describe as a set of tools that are designed to understand, investigate and improve business processes. The company’s mission is to empower the staff with knowledge, skills and tools in order to cut down on costs and cycle time, thus making Dell more efficient.

Dell made BPI a priority because it benefits everyone from customers to employees, to the company itself. We all know BPI is DMAIC in disguise, since every company uses their own jargon.

For more information on our courses or services please visit 6sigma.com’s class schedule.

Read more about Lean Six Sigma:

Seamless Project Management with Lean Six Sigma

Healing Your Business With Lean Six Sigma

Lean Six Sigma: Waste Not Want Not

Lean Six Sigma Methodologies Help Kids Early On

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The 8 Forms of Deadly Waste in Lean Six Sigma

Lean Six Sigma is one of the most advanced and effective methodologies available for business process improvement and optimization. It is especially adept in battling a wide range of problems and inefficiencies. To help better understand and deal with waste, this approach classifies them into the 8 Forms of Deadly Waste. This classification is important because it makes waste much easier to uncover and then eradicate. It also helps you identify environmental improvement opportunities.

The 8 Forms of Deadly Waste can be easily remembered with the mnemonic DOWNTIME:

• Defects
• Overproduction
• Waiting
• Non-value added processing
• Transportation
• Inventory
• Motion
• Employee skills underutilized

Let’s examine each one individually:

Defects

Whenever a business process ends up with an outcome that was not the desired one, all the effort and resources that had gone into producing it would have been wasted. This is why defects and errors of any sort are always undesirable, and are always a major source of waste. This does not just apply to manufacturing, but to providing services to clients and especially processes internal to the company.

Overproduction

We all know that overdoing anything in our personal life is something to be avoided, but this is a type of waste that often goes completely unnoticed in the business world. Whenever something is produced in a higher amount that was necessary, it’s a type of waste, Worst of all, it also multiplies all the other wastes through the rest of the processes. Overproduction often stems from the inability to estimate and forecast business correctly, and from fear of being late with deliveries. However, it is an expensive and risky way to protect against late deliveries to the customer.

Waiting

Any idle time that is part of a business process is actually time wasted. If a step in the process has to be delayed while waiting for raw materials, parts, equipment, instructions or information, it is always going to lead to waste, since the organization’s potential productivity is going to be squandered. That time cannot easily be made up except through overtime and delayed shipments. Every time work stops, it’s a waste, and an opportunity to improve.

Non-value added processing

When trying to standardize an activity, many businesses experience the pitfall of adding steps to a process that are not actually adding value. This means that all the resources and time that go into those steps are wasted, and could have been used to produce value instead. Examples of this type of waste might vary from having the same thing reported twice in the same spreadsheet or report, to having an unneeded layer of packaging to a product that does not add any value to the customer or protect the product from damage while being transported.

Transportation

Most businesses processes tend to include transporting materials, people, products, equipment, tools or even information and very often at least some of that turns out to be unneeded. This is really an activity that doesn’t add any real value to a process and is a common point of possible failure. This means that excess transportation leads to a lot of waste and could have adverse effects on the reliability of the outcome on top of that.

Inventory

Inventory waste is especially dangerous despite the fact that it sounds quite benign at first glance. Whenever there is an excess supply of materials, information or products, it is often a sign of deeper inefficiency or inadequacy of the current state of the process involved. Everything that stays in inventory instead of being utilized has required an input of resources to get to where it is and all of those resources have been used quite inefficiently. Additionally, while something is in inventory it is always subject to deterioration, so its value will always decrease while the cost of having it around will steadily become higher.

Motion

Motion requires both time and energy and no matter if the motion is physical or virtual, an excess of it is bound to slow a process down and create significant waste. This is a very intuitive concept, it’s just essential that one applies it to everything from physical movement of people and machines to unnecessary movement of files on virtual systems.

Employee skills underutilized

The workforce available to a business is one of its most important assets and resources, and forms a significant part of the cost of providing the customer with the product or service sold. As with any other resource, not using it to its full potential is a waste. But humans are creative and are natural problem-solvers, which means that allowing them to apply their abilities, skills and experience would always lead to unpredictable positive benefits to the business.

Connection to the Environment

In addition, these 8 forms of waste have an environmental impact as well.

Defects and overproduction can lead to items needing to be disposed of. Inventory requires extra floor space, lighting, heating and cooling. Waiting pushes out the work, requiring overtime and more energy to keep the lights on. Transportation requires fuel and extra packaging. If you’d like to learn more about the environmental impact of these wastes, check out the EPA Lean and the Environment toolkit >>>

Next time you are evaluating a process, look for DOWNTIME opportunities to reduce time and reduce your environmental impact.

To learn more about Lean, download the Toyota training slides >>>

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