Continuous Improvement, Six Sigma and Risk Management: How They Relate

Continuous Improvement, Six Sigma and Risk Management: How They Relate

Brian J. Galli
Copyright: © 2020 |Pages: 23
DOI: 10.4018/IJoSE.2020070101
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Abstract

The competitive business environment today is something that has never been seen before, as technology continues to challenge the way in which business has been done. As profit margins continue to shrink, it is imperative that companies have robust methods of process management to ensure peak efficiency. Continuous improvement, known as Kaizen in Japanese, is a natural step forward that is informed by the decisions made using risk management. The purpose of this article is to study the relationship between continuous improvement and risk management. In order to accomplish this task, proper definitions will be established, and proof will be provided of their relationship in real-world examples. This article represents the ideas of Lean Six Sigma and Kaizen as methods to improve the processes in many different settings, as they become excellent tools for the continuous improvement phase. Six Sigma is a set of techniques that can detect and improve defects to reduce the variability in processes that may lead to undesirable inconsistencies. Moreover, the article looks at the barriers that stop companies from adopting these methodologies. Finally, the article discusses a method for the implementation of Kaizen and Lean Six Sigma in the form of A3.
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Introduction

The concepts of continuous improvement and risk management are industry standards that help to stay competitive in the market today. The focus of these methods is to reduce and eliminate waste, which will then reduce the incurred costs. Once the production costs are lowered, the saving can be passed on to the consumers. There are many different methodologies for continuous improvement that have been proposed over time. For example, Deming's 14 principals of management detail how managers can improve a company by emphasizing quality throughout and by removing barriers that inhibit work performance. Toyota instituted continuous improvement mechanisms by the name of “The Toyota Way,” which also tackles the problem of improvement from multiple fronts and provides a holistic approach. By adding to this list, Lean Six Sigma is an extension of the lean manufacturing done at Toyota combined with the Six Sigma method (Ahern, Leavy, & Byrne, 2014; Brown & Eisenhardt, 1995).

Research Objective

Literature explains the importance of these variables, their concepts, and models in project management and performance, but information is missing about how they cause such a smooth progression in these fields. Such a research gap is the root of this study, which aims to assess the elements and applications of current variables, concepts, and models. Furthermore, the study aimed to assess the similarities and differences between the variables to suggest a universal framework that encompasses the best elements from the current model. This framework can apply to many elements of projects, operations, and performances in any organization. Essentially, we aim to provide evidence-based answers in our research for primary questions from experts in these variables, their concepts, and models, and the research findings can become a platform for future research on this topic.

Research Gap

Even though there is plenty of literature on the importance of these variables, their concepts, and models in operations and project management, there is a research gap on how they facilitate the progression of operations and project management. To fill this gap, this study will evaluate the most current variables, their concepts, and models and their elements in operations and project management. Furthermore, this study seeks to understand their differences and similarities.

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