The Lean Sigma Scorecard Framework
Leadership communicates a clear vision of creating an injury-free workplace and spells out a strategy of how to get there.
- By Peter Furst
- Jan 02, 2008
The Lean Sigma Scorecard brings
together the best of Lean Enterprise
thinking, Six Sigma processes, and the
Balanced Scorecard’s multiple perspective
management. It combines the use of data
to deploy strategy and drive improvement,
as well as streamlining internal
processes and procedures to maximize
efficiency. The Lean Sigma Scorecard
framework is uniquely positioned to
address many of the shortcomings in traditional
safety management.
The Balanced Scorecard has become
the mainstay of business management
since it was introduced in 1992. Today, just
about all the Fortune 500 companies, as
well as others, have some sort of scorecard
with which their business is managed. The
innovation of the Balanced Scorecard was
that it proposed managing the business
through a number of critical perspectives
so as to have real-time information to
respond to changing conditions and meet
customer needs.
Six Sigma is a widely used, data-driven
quality improvement process. Six Sigma
has been successfully used by a number of
multinational organizations in not only
improvement of operations, but also outstanding
safety outcomes. Manufacturing
uses a discipline called Lean (Lean Manufacturing)
that focuses on process speed
and efficiency. This process has assisted a
number of innovative organizations in garnering
tremendous efficiencies in their
operations, as well as becoming more
nimble in product and process innovations.
The foundation on which the Lean
Sigma Scorecard concept rests is a culture
that is supportive of an injury-free workplace,
as well as a climate that fosters cooperation
of all the people within the organization
to that end. The organization holds
an injury-free workplace as a core value,
and the people operate on this premise
instinctually. The leadership communicates
a clear vision of creating an injuryfree
workplace and spells out a strategy of
how to get there. To accomplish this, the
organization must deploy strategy based on
data and information, and the data should
be utilized to drive the “right” organizational
behavior so as the make the injuryfree
workplace vision a reality.
The four cornerstones of the Lean
Sigma Scorecard are stakeholder focus,
internal organizational systems, operational
processes, and fundamental safety
procedures. These rest on a supportive culture
and are driven by data and information.
The stakeholder cornerstone looks at
the needs of all of the organization’s stakeholders
and tries to address them. Aligning
the organization’s systems, supported by
integrated operations and driven by data
collected from the stakeholders, results in a
360-degree, holistic approach to the creation
of an injury-free workplace.
This then feeds into a larger system of
customers, competition, communication,
finance, banking, etc., to name a few. All of
these in some way exert some degree of
influence on the decisions the workers
make every day in performing their tasks,
influenced by the actions and behaviors of
supervision and management. (Some of
these decisions, if made without an understanding
or appreciation for the complex
systems at work, may lead to incidents and
possible injury and losses.)
Safety and the Lean Sigma Scorecard
Measurement is necessary to effectively
manage. Senior management understands
this well, knowing that the measurement
system influences and drives organizational
behavior. Effective measurement
has to be predictive as well as prescriptive
in nature if it is to provide data and information
for managing performance. Many
organizations have discovered that measurement
is difficult because it is not an
exact science. There are no hard-and-fast
rules of how to go about creating metrics
that provide the critical information necessary
to manage effectively.
To make things more complicated, it is
difficult to predict the impact on individual
behavior and the interactions and interrelationships
among existing diverse variables
and new ones produced by the new
metrics. This is because people are
involved, and their actions are inherently
unpredictable. Another thing that contributes
to the complexity is that important
factors often are hard to measure consistently
and objectively. To effectively measure
this, variability must be designed out
of the system.
The Lean Sigma Scorecard provides
real-time information of what needs to be
addressed in order to improve safety
results. Traditionally, to improve safety, we
analyze our losses and from this we arrive
at a plan to change some aspect of the
effort going forward. This analysis establishes
our improvement strategy and sets
the direction as to what needs to get done
to improve the loss picture and control the
cost-of-risk.
This method of arriving at a strategy
may not necessarily be in alignment with
overall operational goals and/or business
objectives. This, too, creates some of the
difficulty safety faces in the business environment.
Site audits also become the
source of information that drives
improvement strategy. Both audits and
loss analysis may not provide the true picture
of what exactly is driving the undesirable
results by ignoring all system drivers.
This approach is out of alignment with
the operational, business, and organizational
measurements used to manage the
business. Integrated and aligned metrics
will show managers that safety in fact has
the “right” strategy in order to get the
results needed or expected.
This article originally appeared in the January 2008 issue of Occupational Health & Safety.