How One Retailer Competes Using Lean Six Sigma

LogoKum & Go convenience stores knows that the convenience store market is highly competitive. CSP Daily news reports that the retailer has taken to using Lean Six Sigma to help them compete. Kum & Go LC has practiced Six Sigma for several years, considering it a way to not only deliver a great retail experience to customers, but also to differentiate the West Des Moines, Iowa-based chain of more than 400 locations in 11 states.

“We provide safe and clean stores along with first-to-market products and exceptional customer experiences,” Dennis Folden, COO, told CSP Daily News. “That’s why we are able to ensure continued loyalty from our customers. Specifically, Six Sigma, continuous process improvement and a ‘passion for excellence’ are not easily replicated.”

Margins in the retail industry are extremely tight, so every penny counts. Lean Six Sigma is a way to identify opportunities to eliminate waste, unwanted variation, and errors in retail business processes, all of which cost money, add no value for customers, and don’t contribute to the bottom line.

Although Lean Six Sigma’s roots may be in manufacturing, it has been applied in a wide variety of other industries and businesses. If there is a repetitive process involved, the approach can be used to improve it. A retail chain serving millions of customers from hundreds of stores has many such processes. Lean Six Sigma helps first by getting people to understand their business from a process perspective. Most managers who are trained in traditional business schools are taught to view the business as a set of functions, such as marketing, purchasing, human resources, etc.. But customer value is created by processes, not functions. When processes are examined with Lean Six Sigma opportunities for improvement often jump out from the analysis. For example, process maps may reveal a great deal of duplication of effort, or important tasks for which no one has clear responsibility, or confusing lines of authority. Lean Six Sigma’s super-effective DMAIC project execution framework provides a way to pursue these opportunities.

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Author: Thomas Pyzdek

Consultant, author, owner of The Pyzdek Institute