Xerox finds the right tool for tracking continuous improvement

The financial turnaround Xerox made under CEO Anne Mulcahy has been well documented. What may not be as well known is that much of Xerox's recent success can be attributed to its adoption of a Lean Six Sigma program.

"Anne Mulcahy knew we could transition from being a good company to a great one by making Lean Six Sigma a strategic business initiative across the value chain," says George Maszle, director of Lean Six Sigma at Xerox, the Stamford, Conn.-based supplier of document technology and services.

Six Sigma is a disciplined methodology that uses data and statistical analysis to measure and improve a company's operational performance by identifying and eliminating defects in manufacturing and service-related processes. It equates to 3.4 defects per million opportunities. Lean, on the other hand, has come to be known as a methodology focusing on eliminating excess—whether it takes the form of time, activity, or inventory.

Xerox launched an initiative that combined the two concepts in 2002. "The heart of our Lean Six Sigma initiative is the equation that improved quality plus streamlined processes equals satisfied customers, lower costs, and increased capacity," Maszle says. "We've gone through a number of strategic business initiatives before, but this is the first time proven performers were pulled out of key positions so they could focus on the initiative. They were trained as Black Belts [Six Sigma experts] and put to work looking for ways to improve business processes."

Today, the initiative has more than 30 full-time deployment managers, more than 600 Black Belts and Master Black Belts; 2,500 Green Belts; and nearly 30,000 Yellow Belts. More than 1,600 Lean Six Sigma projects have been completed or are under way and contributing to the company's profitability.

Central to the initiative's success is a continued focus on seven key components, or "The Proven Recipe" adopted by Xerox senior leadership in 2002, says Maszle. Those components are:

1. Projects will be selected based on value creation opportunity with the number of projects in process kept to a manageable level.
2. Consistent approaches for tracking financial results will be used, and determined jointly by the deployment team and the financial organization.
3. Deploy and train resources in roles as defined—full-time Black Belts, full-time deployment managers, sponsors, Green Belts—using consistent training.
4. Assign demonstrated top performers to the full-time roles.
5. Adopt the defined organization's structure to enable success.
6. Operations leadership will be engaged in the process and will integrate Lean Six Sigma into daily business operations.
7. Commit at least 0.5 percent of employee population as Black Belts in 2003, and another 0.5 percent in 2004 to achieve critical mass toward transformation.

Maszle says Xerox has found the ideal software solution to support this initiative—the EnterpriseTrack solution from Instantis, which offers enterprise performance improvement solutions. EnterpriseTrack—used for Six Sigma and other structured, project portfolio-based business improvement initiatives—automates the execution, management, and reporting of those methodologies.

"EnterpriseTrack is a project tracking system that gives us project-management perspective to share knowledge. It's a common repository that people can draw from," says Maszle. "The result, for Xerox, is that people are able to search a database for project templates they can replicate. It also is the means to make financial benefits of projects visible for senior management."

Moving forward, Xerox is taking steps to sustain the Lean Six Sigma initiative. "Our next big challenge is to embed the design for Lean Six Sigma across all business units so we can fix problems before they happen," Maszle says.