Page 31 - Lean six sigma demystified

10 Lean Six Sigma DemystifieD

What Are Services?

Services include sales, finance, marketing, procurement, customer support,
logistics, IT, and human resources (HR). A few of the other descriptions of
these activities include transactional, commercial, nontechnical, support, and
administration. These business functions have tried to hide from improve-
ment methods and many have been successful, but the wisdom of Lean Six
Sigma is shifting from blue-collar jobs to white-collar ones. There are huge
opportunities for improvement in service industries and the service com-
ponents of manufacturing.

The Death of Manufacturing

The PBS Nightly Business Report from Diane Eastabrook offered some startling
statistics and insights.
The United States has lost roughly 3 million, or one out of every six, factory
jobs in the past decade. About half of them disappeared over the last 3 years.
The Federal Reserve Bank of Chicago began a project to find out if manu-
facturing is dying in the United States. The Fed wants to know if factories shed
jobs in recent years because of the recession or because of a structural change
in the economy. It says one problem can be corrected with interest rate cuts,
but the other problem can’t.
The statistics aren’t promising. At the end of World War II, one in every three
Americans worked in a factory; today, one in eight does.
Economists fear that the apparel and textile industries face the greatest risk.
But industries that require more skill, that involve R&D, capital, and high skill,

are most likely to survive and prosper: instruments and controls, parts and
transportation, and chemicals.
While job growth has been flat in manufacturing over the past 50 years, it
has been rising steadily in the service industry.
Economists say that this could mean the United States is evolving into a
service-based society, instead of a manufacturing one.
This means that we need to shift our attention from manufacturing quality
to service quality. More and more, the United States is becoming the “brain”
of the planet and other countries are the hands. I recently spoke to an
executive who was retiring after 32 years from a manufacturing company.
They had just completed offshoring their manufacturing business. Only a
few dozen managers remained to oversee the business. And I’ve talked