ABSTRACT
The overarching goal of Lean Six Sigma is to simultaneously improve quality and reduce costs for an organization. It provides a common philosophy and process management approach for organizations to improve their performance. Oftentimes, quality improvements and cost reductions are viewed as contradictory goals. For example, many managers believe that if an organization places effort and resources toward quality improvement, operational costs must rise in terms of additional labor, tools, facility space, and software purchases to monitor and improve quality. On the other side of the coin, managers also believe that if an organization reduces costs, fewer resources will be available to monitor, improve, and control quality. As Philip Crosby pointed out in the late 1970s with his book, Quality Is Free, these are major misconceptions [1]. The misconceptions are still prevalent today in many service, manufacturing, and nonprot organizations. This chapter discusses how quality truly is “free” (and in many cases can reduce costs and improve protability) and how cost reduction and quality improvement goals work in harmony.
