Without a doubt Kaizen.
Kaizen
When I was at Pratt and Whitney Aircraft Canada more than 14 years ago, our VP of Operations brought in Japanese Kaizen experts that had worked at Toyota in Japan. With the multiple and continuous improvements that this method brought, we gained enormous efficiencies in the supply chain and in some cases reduced engine lead times from 24 to 4 months. That VP, Louis Chenevert went on to become Chairman and CEO of United Technologies and his initiative to start a serious Kaizen program certainly helped vault him into that position.
In a Leaders For Manufacturing keynote presentation back in 2000 Louis Chenevert provided an example in leanness. “We consolidated the process for procuring one simple bolt, which was coming from four different suppliers, and costing us from 80 cents to $17.50 each. The consolidation saved $17 million.”
Kaizen is done in events and the strategies are implemented quickly. At PWC we planned one week and executed that plan the next week.
Six Sigma
Jack Welch of GE made Six Sigma famous and supply chains became more efficient as defects and variability were driven out of processes.
From Wikipedia
A Fortune article stated that “of 58 large companies that have announced Six Sigma programs, 91 percent have trailed the S&P 500 since”.
The summary of the article is that Six Sigma is effective at what it is intended to do, but that it is “narrowly designed to fix an existing process” and does not help in “coming up with new products or disruptive technologies.”
“It should only be used in product manufacturing, where the idea of reducing defects to one in six standard deviations really makes sense.”
“At Air Products and Chemicals, which has had one of the most successful process change programs in recent years, the company employed a hybrid approach to process change that closely matched the SAP system it was putting in at the time. Shell has a major effort underway to put in a common version of SAP and improve processes at the same time. It isn’t easy to change both things at once, but it’s silly to change processes and ignore IT.”