Brown’s Briefing: Lean Six Sigma in the Accountancy World
What is Lean Six Sigma?
While it might sound like a good name for a science fiction TV series, Lean Six Sigma (LSS) is actually a methodology and philosophy for process improvement.
At its most basic level, LSS puts the needs of the customer first, aims to eliminate process deviation and waste and it strives for perfection.
Created for the manufacturing industry, Lean Six Sigma can be useful for businesses across a wide range of sectors – including accountancy, which is why we’re using it within Duncan & Toplis.
The history of Lean Six Sigma
LSS started life as two separate methodologies, Lean and Six Sigma which both have their roots in the manufacturing industry. Lean is based on the Toyota production system and Six Sigma was devised by Motorola.
Lean may be considered to be the more intuitive of the two. This system is based on understanding exactly what the customer desires, then achieving delivery of that service as efficiently as possible by eliminating wasteful steps: i.e. it makes the process more lean.
Six Sigma is more data driven and strives to eliminate variation in a process and to strive for perfection. Combined, LSS provides the tools necessary to solve a wide-range of business process problems, from the simple to the highly complex.
Although LSS has its roots in the manufacturing world, it can be just as effective applied to service industries, including accountancy.
Basically, anything with a process can be improved using LSS, whether it’s accounts preparation, client on-boarding, internal transfer of clients, billing, timesheet completion, purchase ledger, sales ledger – the list is endless.
Using LSS provides an ideal opportunity to introduce new technology to your services. For example, a business that’s looking at its purchase ledger process may want to consider incorporating robotic machine learning, allowing for increased efficienciencies.
LSS provides the tools for long-term ongoing initiatives and for relatively short improvement projects.
In addition to this, LSS tools, such as root cause analysis, are finding their way into the text of financial reporting and auditing standards.
How is Duncan & Toplis using LSS?
At Duncan & Toplis, we are in our infancy of using LSS but we’re off to a great start. We are currently looking at the more intuitive, ‘low-hanging fruit’ that can be collected using Lean techniques.
We have already revised an important payroll system and are using other techniques to hit internal financial targets. We have also revised our internal technical resource and have started to utilise visual prompts to ensure team members are focussed on our collective vision.
Numerous other projects have been discussed covering a wide-variety of processes across several different service lines.
While we’re on our own journey to self-improvement using LSS, we can also help our clients to reap the rewards the methodology can bring. If you’re curious about how LSS could help your business, get in touch and we’d be happy to help.
Lean Six Sigma has a place within the accountancy profession, both in practice and within the accountancy function of any business, in any industry.
It can be used to focus efforts, improve process efficiency, concentrate on the needs of the customer and strive for perfection.
Lean Six Sigma isn’t science fiction; it’s an investment in the future of your business.