What: A comprehensive glossary of 101 essential Lean Six Sigma terms with practical definitions and cross-industry applications from manufacturing, healthcare, and oil & gas operations.
Why It Matters: Understanding Lean Six Sigma terminology enables effective process improvement implementation, typically reducing defects by 30-50%, cutting cycle times by 20-40%, and delivering measurable ROI within 6-12 months.
How to Apply: Use this glossary as your reference guide for Lean Six Sigma projects, certification preparation, and cross-functional communication about operational excellence initiatives.
Expected Results: Teams using standardized terminology commonly see 25-40% faster project implementation and 20-30% better stakeholder engagement.
Open any Lean Six Sigma textbook. You'll find definitions written by academics who've never stood on a factory floor at 3 AM troubleshooting a line down. Never sat in an emergency department watching chaos unfold. Never felt the platform shake during a drilling operation.
After implementing these methodologies across 21 countries and three major industries, one pattern emerges: The textbook definitions don't exactly match field reality.
This glossary bridges that gap. All 101 terms include what they mean in practice, how they work across industries, and the misconceptions that derail implementations.
Whether you're pursuing Lean Six Sigma Belt certification, leading transformation initiatives, or trying to decode what consultants are selling, this becomes your translator between theory and reality.
Category: Foundation Terms
Definition: Management philosophy focused on maximizing customer value while minimizing waste through continuous improvement and respect for people.
What It Really Means: Lean isn't about cutting costs or reducing headcount. It's a mindset that sees waste as disrespect—to workers forced to do unnecessary work and customers who pay for non-value activities. Born from Toyota's post-WWII constraints, Lean proves that limitations drive innovation.
Cross-Industry Applications:
Manufacturing: Organizations implement daily team huddles for waste identification, visual management boards at workstations, and gemba walks by management. Typical result: 15-25% productivity improvement within first year
Healthcare: Medical centers conduct weekly rapid improvement workshops, engage frontline staff in problem-solving, implement visual controls. Common outcome: 20-30% reduction in operational waste
Oil & Gas: Companies deploy continuous improvement coaches, conduct regular waste elimination walks, empower operators to identify inefficiencies. Industry benchmark: 15-30% reduction in non-productive time
Common Misconception: That Lean means "doing more with less people." True Lean does more with less waste, often requiring the same or more people focused on value-added work.
Category: Foundation Terms
Definition: Data-driven methodology using statistical analysis to reduce process variation and achieve near-perfect quality of 3.4 defects per million opportunities.
What It Really Means: Six Sigma brings engineering discipline to all processes. It replaces opinions with data, assumptions with analysis. The name represents six standard deviations between process mean and specification limits—a level where defects become nearly impossible.
Cross-Industry Applications:
Manufacturing: Companies train technical staff in statistical methods, implement control charts at critical processes, require data-based decision making. Typical achievement: 50-90% defect reduction within 18 months
Healthcare: Hospitals assign quality analysts to units, implement statistical monitoring of outcomes, use hypothesis testing for improvements. Common result: 25-40% reduction in medical errors
Oil & Gas: Operators implement real-time statistical monitoring, train personnel in basic statistics, require root cause validation. Industry standard: achieving 3-4 sigma performance in critical processes
Common Misconception: That Six Sigma is only about statistics. While data-driven, successful Six Sigma equally emphasizes change management and cultural transformation.
Category: Foundation Terms
Definition: Integrated methodology combining Lean's waste elimination and speed with Six Sigma's defect reduction and precision.
What It Really Means: Lean Six Sigma recognizes a fundamental truth: customers want things fast AND right. Lean alone might deliver garbage faster. Six Sigma alone might perfect unnecessary steps. Together, they optimize both efficiency and effectiveness.
Cross-Industry Applications:
Healthcare: Hospitals map patient flow using Lean tools while applying statistical control to clinical outcomes, training staff in both methodologies. Typical results: 20-30% reduction in both wait times and error rates
Manufacturing: Facilities implement flow improvements while controlling critical parameters, integrate visual management with statistical monitoring. Common achievement: 30-40% improvement in both speed and quality
Oil & Gas: Operations eliminate waiting time while reducing parameter variation, combine waste walks with statistical analysis. Industry benchmark: 20-35% improvement in efficiency with enhanced safety
Why Integration Works: Lean creates flow and reveals problems. Six Sigma solves those problems systematically. The combination typically accelerates improvement 40-60% beyond what either achieves independently.
Category: Foundation Terms
Definition: Ongoing effort to enhance products, services, or processes through incremental and breakthrough improvements.
What It Really Means: Continuous improvement compounds small gains into transformational results. Like interest, 1% weekly improvement yields over 50% annual improvement. It's not about perfection but persistent progress.
Cross-Industry Applications:
Manufacturing: Organizations allocate 5-10% of work time to improvement activities, implement suggestion systems, celebrate incremental wins. Typical outcome: 10-20% annual productivity gain
Healthcare: Units conduct brief daily improvement huddles, implement one small change weekly, track cumulative impact. Common result: 30-50% reduction in quality incidents over two years
Oil & Gas: Platforms maintain active suggestion programs, implement operator-driven improvements, track improvement metrics. Industry average: 15-25% annual cost reduction through small improvements
Category: Foundation Terms
Definition: State where each employee can see value flow to customers and fix problems at the source.
What It Really Means: Operational excellence isn't a destination but a capability. Organizations achieving it respond to problems in minutes, not months. Everyone understands how their work connects to customer value.
Cross-Industry Applications:
Healthcare: Leading hospitals display real-time patient flow metrics, empower staff to stop processes for quality, measure from patient perspective. Benchmark performance: 90th percentile in quality metrics
Manufacturing: Plants post value stream maps visibly, train all employees in problem-solving, require rapid response to issues. Typical achievement: 20-30% better performance than industry average
Oil & Gas: Operations implement real-time performance dashboards, develop problem-solving capability at all levels, connect metrics to business goals. Common result: 15-25% improvement in operational efficiency
Category: Foundation Terms
Definition: Japanese philosophy of continuous incremental improvement involving everyone.
What It Really Means: Kaizen transforms organizations by making everyone a problem solver. It's democracy applied to improvement—the people doing the work know best how to improve it.
Cross-Industry Applications:
Manufacturing: Companies implement formal suggestion systems, guarantee management response within 48-72 hours, implement 60-80% of submitted ideas. Typical participation: 5-10 ideas per employee annually
Healthcare: Nursing units use improvement boards for idea submission, test suggestions within one week, spread successful changes. Common outcome: 40-60% of improvements from frontline staff
Oil & Gas: Crews participate in monthly improvement events, document changes with before/after data, share across operations. Industry average: 20-30% of safety improvements from operator suggestions
Category: Foundation Terms
Definition: Japanese term for "actual place" where value-creating work occurs.
What It Really Means: Gemba represents management by fact, not fiction. Problems can't be solved from spreadsheets. Understanding requires observation where work happens.
Cross-Industry Applications:
Healthcare: Executives spend 2-4 hours weekly in patient care areas, observe actual workflows, make decisions based on direct observation. Typical finding: 30-40% of problems invisible from reports
Manufacturing: Engineers spend first hour daily on production floor, managers hold meetings at problem locations, decisions require direct observation. Common result: 50% faster problem resolution
Oil & Gas: Management conducts regular field visits, works alongside crews periodically, bases improvements on firsthand experience. Industry practice: 20-30% of improvements from gemba observations
Category: Foundation Terms
Definition: Scientific method for improvement: Plan change, Do it, Check results, Act on learnings.
What It Really Means: PDCA brings experimental rigor to improvement. Instead of arguing about solutions, try them small-scale and let data decide.
Cross-Industry Applications:
Manufacturing: Teams test improvements on single machines before broader rollout, document hypotheses and results, adjust based on data. Typical success rate: 70-80% of tested improvements scaled
Healthcare: Units pilot protocols with small patient groups, measure outcomes daily, modify based on rapid feedback. Common practice: 3-4 PDCA cycles before full implementation
Oil & Gas: Crews test procedure changes on single equipment first, compare performance metrics, standardize proven improvements. Industry standard: 60-70% improvement adoption after testing
Category: Foundation Terms
Definition: Systematic identification and enhancement of existing processes for better outcomes.
What It Really Means: Process improvement reveals that most problems aren't people problems—they're system problems. Fix the process, and performance follows.
Cross-Industry Applications:
Healthcare: Teams map current processes with frontline staff input, identify non-value steps, redesign for efficiency. Typical reduction: 30-50% in process steps
Manufacturing: Organizations video record actual work, analyze for waste, redesign layouts and sequences. Common improvement: 20-40% productivity increase
Oil & Gas: Operations document all process steps with time measurements, identify waiting and rework, restructure for parallel processing. Industry average: 25-35% cycle time reduction
Category: Foundation Terms
Definition: Coordinated activities to direct and control quality throughout an organization.
What It Really Means: Quality management prevents defects rather than detecting them. It builds quality into processes rather than inspecting it in products.
Cross-Industry Applications:
Manufacturing: Facilities implement quality at source with error-proofing, empower operators to stop for quality, display metrics visibly. ISO 9001 certified organizations typically see: 25-40% reduction in quality costs
Healthcare: Clinical teams use standardized protocols with verification steps, implement bedside scanning, maintain real-time dashboards. Common outcome: 50-70% reduction in preventable errors
Oil & Gas: Operations follow API Q1/Q2 standards, implement competency verification, monitor quality KPIs continuously. Industry benchmark: 30-50% reduction in quality incidents
Category: Foundation Terms
Definition: Methods consistently demonstrating superior results across applications.
What It Really Means: Best practices aren't universal laws. They're proven patterns that work under specific conditions. The key is understanding which elements transfer and which need adaptation.
Cross-Industry Applications:
Healthcare: Organizations adapt surgical safety checklists to local context, measure compliance and outcomes, refine based on results. WHO checklist adoption typically reduces complications by 30-40%
Manufacturing: Plants adopt quick changeover techniques from automotive industry, modify for their equipment, share successful adaptations. Common result: 50-70% reduction in changeover time
Oil & Gas: Operations implement well control best practices with local modifications, validate through incident tracking, update based on learnings. Industry standard: 60-80% reduction in control incidents
Category: Foundation Terms
Definition: Comparing performance against industry leaders to identify improvement opportunities.
What It Really Means: Benchmarking reveals the art of the possible. It's not about copying but understanding principles that enable superior performance.
Cross-Industry Applications:
Healthcare: Hospitals study high-reliability industries like aviation, adapt safety protocols for medical context, measure cultural change. Typical improvement: 20-30% reduction in safety events
Manufacturing: Companies benchmark across industries for applicable practices, test transferability, implement with modifications. Common finding: 15-25% improvement from cross-industry learning
Oil & Gas: Operations study nuclear industry safety practices, implement applicable human performance tools, track implementation impact. Industry result: 25-40% improvement in safety metrics
Category: Lean Methodology Terms
Definition: Workplace organization through Sort, Set in Order, Shine, Standardize, Sustain.
What It Really Means: 5S makes problems visible instantly. In a 5S workplace, you spot abnormalities in seconds, not hours. It's not about appearances but about visual management.
Cross-Industry Applications:
Manufacturing: Facilities implement shadow boards for tools, color-code by frequency of use, assign area ownership. Typical result: 50-80% reduction in search time
Healthcare: Operating rooms create color-coded zones, use visual indicators for supply levels, implement daily audits. Common outcome: 30-50% reduction in setup time
Oil & Gas: Platforms establish designated storage areas, implement tool control systems, use inspection boards. Industry standard: 40-60% reduction in foreign object incidents
Category: Lean Methodology Terms
Definition: Visual representation of material and information flow delivering customer value.
What It Really Means: VSM reveals the shocking truth: typically 90-95% of process time adds no value. The map shows where time, money, and energy disappear.
Cross-Industry Applications:
Healthcare: Emergency departments map patient flow using observation and timing, identify wait points, calculate value-added percentage. Typical finding: only 10-20% of time adds value
Manufacturing: Cross-functional teams document actual flow, measure inventory at each stage, identify bottlenecks. Common discovery: 60-80% of lead time is waiting
Oil & Gas: Maintenance operations map work order flow, track handoffs between groups, identify delays. Industry average: 35-45% of time is value-added after improvements
Category: Lean Methodology Terms
Definition: Producing and delivering exactly what's needed, when needed, in the quantity needed.
What It Really Means: JIT removes safety nets to expose problems. Like walking a tightrope without a net, it forces excellence because failure becomes immediately visible.
Cross-Industry Applications:
Manufacturing: Companies implement pull systems based on actual demand, reduce batch sizes, synchronize with suppliers. Typical achievement: 40-60% inventory reduction
Healthcare: Pharmacies implement unit-dose delivery, eliminate floor stock except emergency medications, use point-of-use ordering. Common result: 50-70% reduction in expired medications
Oil & Gas: Platforms coordinate with supply vessels for just-in-time delivery, minimize onboard storage, use demand-based ordering. Industry benchmark: 30-40% reduction in inventory costs
Category: Lean Methodology Terms
Definition: Visual signal system controlling production and material movement.
What It Really Means: Kanban prevents overproduction—Lean's worst waste—by connecting production to actual consumption. Nothing moves without downstream pull.
Cross-Industry Applications:
Healthcare: Supply rooms use two-bin systems with reorder cards, color-code for urgency, automate reordering through scanning. Typical outcome: 90-95% reduction in stockouts
Manufacturing: Production lines use kanban cards to signal needs, limit work-in-process between stations, make flow visible. Common result: 40-60% WIP reduction
Oil & Gas: Maintenance operations use kanban boards for scheduling, limit concurrent work, visualize capacity. Industry practice: 20-30% improvement in on-time completion
Category: Lean Methodology Terms
Definition: Practiced routines developing improvement and coaching muscle memory.
What It Really Means: Kata transforms improvement from event to habit. Through daily practice, scientific thinking becomes automatic, like breathing.
Cross-Industry Applications:
Manufacturing: Supervisors conduct daily coaching cycles using five standard questions, document experiments, review learnings. Organizations practicing kata typically generate: 5-10 improvements per person annually
Healthcare: Managers practice improvement kata with staff daily, use PDCA thinking for problems, build problem-solving culture. Common result: 30-40% increase in improvement ideas
Oil & Gas: Teams use kata routines for safety observations, practice structured problem-solving, document learnings systematically. Industry outcome: 25-35% improvement in hazard identification
Category: Lean Methodology Terms
Definition: Available time divided by customer demand, setting operational rhythm.
What It Really Means: Takt time is the heartbeat of operations. Too fast creates waste, too slow disappoints customers. Matching takt synchronizes entire value streams.
Cross-Industry Applications:
Manufacturing: Assembly lines calculate and display takt time, train operators to work within takt, balance workload accordingly. Typical result: 20-30% improvement in delivery performance
Healthcare: Emergency departments calculate patient arrival takt by hour, adjust staffing to match demand patterns, monitor actual versus takt. Common outcome: 15-25% throughput improvement
Oil & Gas: Drilling operations establish footage targets based on takt, monitor progress hourly, adjust resources to maintain pace. Industry standard: 20-30% reduction in drilling time variation
Category: Lean Methodology Terms
Definition: Current best method for performing tasks, documented and followed consistently.
What It Really Means: Standard work isn't bureaucracy—it's the foundation for improvement. You can't improve randomness, but you can improve standards.
Cross-Industry Applications:
Healthcare: ICUs create visual standards for procedures posted at bedside, include critical steps with verification, update based on outcomes. Typical impact: 60-80% reduction in procedure variation
Manufacturing: Operators co-develop standard work with engineers, document with photos and key points, post at workstations. Common result: 40-50% reduction in defects
Oil & Gas: Crews participate in creating standard procedures, validate through testing, review after incidents. Industry benchmark: 50-70% reduction in procedural errors
Category: Lean Methodology Terms
Definition: Mistake-proofing devices preventing errors or making them obvious.
What It Really Means: Poka-yoke accepts human fallibility and designs systems accordingly. Instead of punishing mistakes, prevent them.
Cross-Industry Applications:
Healthcare: Different connectors prevent gas mix-ups, color-coding prevents wrong-route medications, forcing functions require verification. Typical effectiveness: prevents 95-99% of targeted errors
Manufacturing: Asymmetric part designs prevent incorrect assembly, sensors detect missing components, fixtures ensure proper positioning. Common result: 80-90% reduction in assembly errors
Oil & Gas: Lockout devices prevent energized equipment operation, interlocks prevent conflicting operations, permits control simultaneous work. Industry standard: 70-90% reduction in related incidents
Category: Lean Methodology Terms
Definition: Leveling production volume and mix to reduce variation.
What It Really Means: Heijunka absorbs demand variation to protect operations. Like a reservoir smoothing river flow, it prevents chaos from reaching the shop floor.
Cross-Industry Applications:
Manufacturing: Production planning uses heijunka boxes to level daily schedules, mix products in repeating patterns, limit variation to ±10%. Typical outcome: 30-40% reduction in overtime
Healthcare: Surgery schedules balance case mix throughout the day, reserve capacity for emergencies, level surgeon workload. Common result: 15-20% improvement in OR utilization
Oil & Gas: Maintenance planning levels work across periods, balances preventive and corrective tasks, sequences by resource availability. Industry practice: 20-30% improvement in resource utilization
Category: Lean Methodology Terms
Definition: Visual/audible alert system signaling abnormalities immediately.
What It Really Means: Andon empowers anyone to stop the line when problems occur. It celebrates problem exposure rather than hiding issues.
Cross-Industry Applications:
Manufacturing: Production lines install pull cords or buttons at each station, display status on boards, require rapid response. Typical result: 70-90% reduction in defect escape
Healthcare: Patient rooms implement call systems with priority levels, track response times automatically, escalate if delayed. Common outcome: 30-40% improvement in response time
Oil & Gas: Digital systems display equipment status real-time, generate automatic alerts for deviations, track response and resolution. Industry standard: 50-60% reduction in problem escalation
Category: Lean Methodology Terms
Definition: Maintenance strategy maximizing equipment effectiveness through operator ownership.
What It Really Means: TPM transforms operators from equipment users to equipment partners. They prevent failures rather than waiting for maintenance to fix them.
Cross-Industry Applications:
Manufacturing: Operators perform daily cleaning and inspection, use simple checklists, tag abnormalities for repair. TPM programs typically achieve: OEE improvement from 45-55% to 75-85%
Healthcare: Nursing staff conduct basic equipment checks each shift, clean while inspecting, document issues for biomedical engineering. Common result: 40-60% reduction in equipment downtime
Oil & Gas: Operators perform routine maintenance tasks, conduct pre-use inspections, track equipment condition. Industry benchmark: 20-30% reduction in breakdown maintenance
Category: Lean Methodology Terms
Definition: Systematic method reducing changeover time to under 10 minutes.
What It Really Means: SMED destroys the economic order quantity myth. When changeovers take minutes, not hours, small batches become profitable.
Cross-Industry Applications:
Manufacturing: Teams separate internal from external setup, convert internal to external where possible, standardize procedures. Typical achievement: 70-90% reduction in changeover time
Healthcare: OR teams prepare next case during current surgery, use standardized setup carts, perform parallel activities. Common result: 50-70% reduction in turnover time
Oil & Gas: Drilling crews pre-position tools before operations, use quick-connect systems, coordinate parallel activities. Industry standard: 40-60% reduction in trip time
Category: Lean Methodology Terms
Definition: Three wastes: Muda (non-value), Muri (overburden), Mura (unevenness).
What It Really Means: These three evils create vicious cycles. Unevenness causes overburden, which generates waste. Eliminating one requires addressing all three.
Cross-Industry Applications:
Healthcare: Units balance workload across shifts (mura), eliminate unnecessary documentation (muda), prevent excessive overtime (muri). Typical impact: 20-30% improvement in staff satisfaction and quality
Manufacturing: Operations level production schedules, remove non-value steps, right-size equipment capacity. Common result: 25-35% productivity improvement
Oil & Gas: Teams balance work across crews, eliminate redundant procedures, prevent equipment overload. Industry outcome: 30-40% reduction in failures and incidents
Category: Lean Methodology Terms
Definition: Defects, Overproduction, Waiting, Non-utilized talent, Transportation, Inventory, Motion, Extra processing.
What It Really Means: DOWNTIME represents 90-95% of most processes. Eliminating these wastes reveals capacity you didn't know existed.
Cross-Industry Applications:
Healthcare: Staff map their workflows identifying walking distance, waiting for supplies, duplicate documentation. Typical finding: 2-3 hours of waste per shift eliminated
Manufacturing: Teams use waste walks to identify all eight types, prioritize by impact, systematically eliminate. Common result: 30-50% capacity increase without investment
Oil & Gas: Crews document equipment moves, permit redundancies, idle time, then eliminate systematically. Industry average: 25-35% efficiency improvement
Category: Lean Methodology Terms
Definition: Production triggered by actual consumption, not forecasts.
What It Really Means: Pull systems connect production to reality. Instead of guessing what customers want, wait for them to tell you through consumption.
Cross-Industry Applications:
Manufacturing: Downstream processes signal needs through cards or signals, upstream produces only when signaled, supermarkets buffer variation. Typical result: 50-70% inventory reduction
Healthcare: Pharmacies refill based on actual usage, supplies ordered at point of use, no batch replenishment. Common outcome: 60-80% reduction in expired items
Oil & Gas: Maintenance orders parts based on work orders, suppliers deliver per consumption, minimal safety stock maintained. Industry benchmark: 25-35% reduction in inventory costs
Category: Lean Methodology Terms
Definition: Moving items individually through processes without batching.
What It Really Means: One-piece flow exposes problems immediately. Like removing water from a river, it reveals every rock and obstacle.
Cross-Industry Applications:
Manufacturing: Assembly lines pass single units between stations, eliminate buffers, surface problems instantly. Typical achievement: 70-90% lead time reduction
Healthcare: Laboratories process specimens immediately upon arrival, no batching for efficiency, continuous results flow. Common result: 50-60% reduction in turnaround time
Oil & Gas: Permit approvals process individually through system, no batch reviews, immediate handling at each step. Industry standard: 40-50% faster approval cycles
Category: Lean Methodology Terms
Definition: Automation with human touch—machines detect problems and stop automatically.
What It Really Means: Jidoka prevents defects from multiplying. Machines become quality inspectors, freeing humans for improvement work.
Cross-Industry Applications:
Manufacturing: Equipment includes sensors to detect abnormalities, stops automatically when parameters exceeded, alerts operators for correction. Typical result: 90-95% reduction in defect propagation
Healthcare: Infusion pumps detect air bubbles and occlusions, stop flow automatically, alert nurses immediately. Common outcome: 80-90% reduction in infusion errors
Oil & Gas: Automated systems detect pressure anomalies, initiate shutdown sequences, notify control room for intervention. Industry standard: prevents 95% of potential overrun incidents
Category: Lean Methodology Terms
Definition: Horizontal deployment of best practices across organization.
What It Really Means: Yokoten multiplies improvement impact. One team's solution becomes everyone's standard, accelerating organizational learning.
Cross-Industry Applications:
Manufacturing: Plants share improvements through databases with photos and results, hold monthly sharing sessions, track adoption rates. Typical spread: 70-80% of applicable improvements adopted within 90 days
Healthcare: Health systems maintain improvement repositories, conduct regular webinars, provide implementation support. Common result: successful practices spread to 60-70% of applicable units
Oil & Gas: Operations share lessons learned across all sites, use digital platforms for real-time sharing, verify implementation. Industry practice: best practices deployed fleet-wide within 30-60 days
Category: Lean Methodology Terms
Definition: "Go and see" - understanding through direct observation.
What It Really Means: Genchi genbutsu replaces assumptions with facts. Problems can't be solved from conference rooms—understanding requires presence.
Cross-Industry Applications:
Healthcare: Executives shadow frontline staff full shifts, observe actual workflows, base decisions on direct observation. Typical discovery: 40-50% of barriers invisible from data alone
Manufacturing: Engineers spend time observing actual production, sketch problems real-time, test solutions immediately. Common outcome: 50-60% faster problem resolution
Oil & Gas: Office personnel work field rotations periodically, experience conditions firsthand, design with user input. Industry result: 30-40% better solution adoption
Category: Lean Methodology Terms
Definition: Strategy deployment aligning improvement with organizational goals.
What It Really Means: Hoshin kanri ensures everyone rows in the same direction. It connects daily improvement to strategic objectives through cascading targets.
Cross-Industry Applications:
Manufacturing: Annual objectives cascade through visual matrices to department goals, track progress on bowling charts, review monthly. Typical alignment: 80-90% of improvements support strategic goals
Healthcare: System priorities deploy to unit-level metrics, daily huddles show linkage to system goals, use catchball process for feasibility. Common result: 70-80% of units achieve breakthrough objectives
Oil & Gas: Corporate goals cascade to site-specific actions, visual boards show progress, regular reviews ensure alignment. Industry practice: 60-70% improvement in goal achievement
Category: Lean Methodology Terms
Definition: "Big room" visual management center for projects.
What It Really Means: Obeya creates transparency and accelerates decision-making. All information visible in one room eliminates communication delays.
Cross-Industry Applications:
Manufacturing: Project teams co-locate in dedicated rooms with walls displaying schedules, issues, metrics, enabling rapid decisions. Typical result: 25-35% reduction in project duration
Healthcare: Construction projects use visual management rooms, all stakeholders meet weekly, resolve issues immediately. Common outcome: 20-30% reduction in project delays
Oil & Gas: Turnaround planning uses obeya rooms with all work packages visible, daily coordination meetings, real-time problem solving. Industry standard: 15-25% reduction in turnaround duration
Category: Lean Methodology Terms
Definition: Water spider—dedicated material handler supporting production.
What It Really Means: Mizusumashi lets value-adders add value. By separating material handling from production, operators focus on their expertise.
Cross-Industry Applications:
Manufacturing: Dedicated handlers follow standard routes delivering materials, remove empty containers, maintain timed cycles. Typical impact: 20-30% improvement in direct labor efficiency
Healthcare: Supply runners make scheduled rounds to units, restock based on visual signals, handle all logistics. Common result: nurses gain 60-90 minutes of patient care time per shift
Oil & Gas: Logistics coordinators manage all material movement, deliver tools to point of use, handle equipment staging. Industry benchmark: 25-35% improvement in productive time
Category: Six Sigma Terms
Definition: Define, Measure, Analyze, Improve, Control—problem-solving methodology.
What It Really Means: DMAIC prevents the ready-fire-aim approach to improvement. It ensures you understand problems before implementing solutions.
Cross-Industry Applications:
Healthcare: Project teams follow structured phases with tollgate reviews, collect baseline data minimum 30 days, pilot solutions before full implementation. Typical project duration: 4-6 months with 25-40% improvement
Manufacturing: Teams use statistical tools at each phase, validate root causes with data, implement controls to sustain gains. Common result: 50-70% reduction in targeted defects
Oil & Gas: Projects scope specifically to measurable problems, analyze historical data for patterns, monitor improvements statistically. Industry standard: 30-50% improvement in targeted metrics
Category: Six Sigma Terms
Definition: Define, Measure, Analyze, Design, Verify—new process design methodology.
What It Really Means: DMADV builds quality in from the start. Instead of fixing problems later, prevent them through robust design.
Cross-Industry Applications:
Healthcare: Teams design new services using patient input, simulate processes before implementation, pilot with small groups first. Typical outcome: new processes achieve 4-5 sigma capability at launch
Manufacturing: Product development follows DMADV phases, uses design of experiments for optimization, validates through capability studies. Common result: 60-70% reduction in launch issues
Oil & Gas: Well designs follow structured methodology, incorporate risk assessment, verify through simulations. Industry practice: 40-50% reduction in design-related problems
Category: Six Sigma Terms
Definition: Time-series graph with control limits distinguishing variation types.
What It Really Means: Control charts separate signal from noise. They prevent overreacting to normal variation while catching real problems early.
Cross-Industry Applications:
Manufacturing: Operators plot measurements hourly on charts, calculate limits from stable baseline (typically 25-30 points), investigate special causes immediately. Typical capability: catch problems 4-8 hours before defects occur
Healthcare: Units track infection rates monthly with 3-sigma limits, distinguish common from special cause, respond appropriately. Common practice: detect outbreaks 2-3 weeks earlier than traditional methods
Oil & Gas: Operations monitor drilling parameters continuously, set limits based on historical performance, adjust when signals appear. Industry standard: prevent 60-70% of potential stuck pipe incidents
Category: Six Sigma Terms
Definition: Ratio comparing process variation to specifications.
What It Really Means: Capability indices reveal whether processes can meet requirements consistently. Cp shows potential, Cpk shows reality.
Cross-Industry Applications:
Manufacturing: Quality systems require Cpk >1.33 for critical characteristics, >1.0 for others, improvement focus on <1.0. Industry standard: 90% reduction in defects when achieving Cpk >1.67
Healthcare: Laboratories monitor test method Cpk, investigate when below 1.0, redesign processes to achieve >1.33. Common outcome: 50-70% reduction in repeat testing
Oil & Gas: Critical process parameters maintain Cpk >1.33, non-critical >1.0, improvement projects target capability increase. Industry benchmark: 60-80% reduction in off-spec production
Category: Six Sigma Terms
Definition: Suppliers, Inputs, Process, Outputs, Customers—high-level process map.
What It Really Means: SIPOC provides helicopter view before diving into details. It ensures everyone agrees on scope before improvement begins.
Cross-Industry Applications:
Healthcare: Teams create SIPOC diagrams on walls using sticky notes, identify all stakeholders, validate with process participants. Typical discovery: 20-30% more stakeholders than initially recognized
Manufacturing: Cross-functional groups develop SIPOC before detailed mapping, clarify boundaries, identify all customers. Common finding: 30-40% of problems originate outside assumed scope
Oil & Gas: Project teams use SIPOC to define interfaces, clarify handoffs, document requirements. Industry practice: reduces scope creep by 50-60%
Category: Six Sigma Terms
Definition: Systematic capture of customer needs and expectations.
What It Really Means: VOC translates customer language into specifications. It prevents perfectly solving the wrong problem.
Cross-Industry Applications:
Healthcare: Teams conduct patient interviews and surveys, analyze complaints, observe patient journeys, translate to measurable requirements. Typical finding: 40-50% of priorities differ from assumptions
Manufacturing: Organizations use multiple VOC sources including surveys, warranty data, service calls, translate to critical specifications. Common discovery: customers value reliability over features 3:1
Oil & Gas: Operations gather operator feedback through structured methods, conduct task analysis, design equipment accordingly. Industry result: 30-40% reduction in human factor incidents
Category: Six Sigma Terms
Definition: Product/service characteristics most important to customers.
What It Really Means: CTQs focus improvement on what matters. Among hundreds of possible metrics, CTQs are the vital few determining success.
Cross-Industry Applications:
Healthcare: Patient satisfaction analysis identifies 3-5 key drivers accounting for 70-80% of overall satisfaction, all improvements must impact these. Common CTQs: wait time, pain management, communication
Manufacturing: Pareto analysis of returns identifies top 2-3 CTQs driving 80-90% of complaints, focus all resources there. Typical result: 70-80% complaint reduction
Oil & Gas: Safety analysis identifies critical behaviors driving 60-70% of incidents, concentrate training and monitoring. Industry outcome: 40-50% incident reduction
Category: Six Sigma Terms
Definition: Normalized defect rate enabling cross-process comparison.
What It Really Means: DPMO levels the playing field. It fairly compares simple and complex processes by accounting for opportunity differences.
Cross-Industry Applications:
Manufacturing: Quality systems track DPMO for all processes, benchmark across operations, focus on highest DPMO areas. Typical improvement: from 10,000-30,000 DPMO to under 1,000
Healthcare: Medication administration calculates DPMO including all verification points, enables unit comparison despite complexity differences. Common achievement: 50-70% DPMO reduction
Oil & Gas: Connection integrity tracks DPMO across different types, normalizes for complexity, drives targeted improvement. Industry standard: achieve <100 DPMO for critical connections
Category: Six Sigma Terms
Definition: Systematic identification of fundamental problem causes.
What It Really Means: RCA digs past symptoms to systemic issues. It keeps asking "why" until reaching causes you can actually eliminate.
Cross-Industry Applications:
Healthcare: Teams use structured RCA tools including fishbone diagrams and 5 whys, involve frontline staff, test solutions before scaling. Typical finding: 70-80% of causes are system, not people
Manufacturing: Engineers facilitate RCA using data and statistical analysis, validate causes experimentally, verify solution effectiveness. Common outcome: 90% problem elimination when true root cause addressed
Oil & Gas: Incident investigations follow formal RCA protocols, test hypotheses with evidence, implement systemic corrections. Industry standard: 80-90% reduction in repeat incidents
Category: Six Sigma Terms
Definition: Cause-and-effect diagram organizing potential causes into categories.
What It Really Means: Fishbone diagrams ensure comprehensive cause investigation. The structure prevents overlooking entire categories of causes.
Cross-Industry Applications:
Healthcare: Teams build fishbones for quality issues using categories like People, Process, Environment, Equipment, Materials. Typical use: identifies 15-20 potential causes, validates 3-5 actual
Manufacturing: Quality circles create fishbones for each defect type, brainstorm all possibilities, validate through data collection. Common practice: 60-70% of brainstormed causes prove insignificant
Oil & Gas: Safety teams construct fishbones for incidents, include human factors, verify through investigation. Industry standard: comprehensive analysis reduces recurrence 70-80%
Category: Six Sigma Terms
Definition: Proactive risk assessment identifying potential failures and impacts.
What It Really Means: FMEA prevents fires instead of fighting them. By imagining everything that could go wrong, you can prevent most of it.
Cross-Industry Applications:
Healthcare: Teams conduct FMEA before new procedures, score severity/occurrence/detection, implement controls for high-risk items. Typical prevention: 80-90% of potential errors identified and mitigated
Manufacturing: Design and process FMEAs standard for new products, require risk reduction for RPN >100. Common result: 50-70% reduction in warranty claims
Oil & Gas: Engineering performs FMEA on critical systems, implements redundancy for high-severity failures, validates controls. Industry practice: prevents 90-95% of critical failures
Category: Six Sigma Terms
Definition: Statistical approach for understanding factor relationships efficiently.
What It Really Means: DOE reveals hidden interactions between variables. It finds optimal settings with minimum trials, replacing guesswork with science.
Cross-Industry Applications:
Manufacturing: Engineers use fractional factorial designs testing 4-7 factors with 8-16 runs instead of hundreds, identify interactions. Typical finding: 20-30% improvement from unexpected factor combinations
Healthcare: Clinical teams test multiple interventions simultaneously using DOE principles, identify best combinations efficiently. Common outcome: 40-50% better results than single-factor testing
Oil & Gas: Operations optimize multiple drilling parameters using DOE, find settings for different conditions, reduce testing time 70-80%. Industry result: 25-35% performance improvement
Category: Six Sigma Terms
Definition: Number of standard deviations between process center and specification limit.
What It Really Means: Sigma level translates capability into universal language. Whether making chips or treating patients, 6 sigma means near-perfection.
Cross-Industry Applications:
Manufacturing: Organizations target minimum 4 sigma for standard processes, 5-6 sigma for critical. Moving from 3 to 4 sigma typically reduces defects 90%
Healthcare: Clinical processes measured in sigma terms, improvement goals set as sigma increases. Common target: achieve 4 sigma (99.4% success) for critical procedures
Oil & Gas: Safety processes evaluated by sigma level, world-class defined as 5+ sigma. Industry benchmark: 4.5 sigma represents top quartile performance
Category: Six Sigma Terms
Definition: Study validating measurement system consistency.
What It Really Means: Gage R&R ensures you can trust your data. Bad measurements lead to bad decisions, regardless of analytical sophistication.
Cross-Industry Applications:
Manufacturing: Quality departments require Gage R&R <10% of tolerance for critical measurements, <30% for others. Typical finding: 20-30% of perceived variation is measurement error
Healthcare: Laboratories conduct R&R studies on test methods, validate technician consistency, improve methods when variation excessive. Common outcome: 40-50% reduction in test variation
Oil & Gas: Inspection programs validate measurement tools and inspector consistency, require certification when R&R acceptable. Industry standard: measurement variation <10% of process variation
Category: Six Sigma Terms
Definition: Comprehensive evaluation of entire measurement process.
What It Really Means: MSA reveals whether variation comes from the process or measurement. You can't improve what you can't accurately measure.
Cross-Industry Applications:
Manufacturing: Complete MSA required before capability studies, includes bias, linearity, stability analysis. Typical discovery: 25-35% of problems are measurement-related
Healthcare: Clinical measurement systems analyzed end-to-end, from sample collection through reporting. Common finding: 30-40% of variation from pre-analytical factors
Oil & Gas: Comprehensive MSA for critical parameters, includes sensor calibration through data recording. Industry practice: reduces measurement uncertainty 50-60%
Category: Six Sigma Terms
Definition: Probability of unit passing through entire process defect-free.
What It Really Means: RTY reveals hidden factories within factories—all the rework masked by final yields. It shows true process health.
Cross-Industry Applications:
Manufacturing: Calculate RTY by multiplying yields at each step, reveal hidden rework loops. Typical finding: 95% final yield may have only 70% RTY
Healthcare: Track patient journey RTY including readmissions and repeat procedures, focus on first-pass success. Common discovery: actual RTY 20-30% below perceived quality
Oil & Gas: Monitor well construction RTY including all remedial work, optimize for right-first-time. Industry average: improving RTY from 60% to 85% doubles profitability
Category: Six Sigma Terms
Definition: Total cost of defects, rework, and failure prevention.
What It Really Means: COPQ makes quality financially visible. It shows quality isn't a cost—poor quality is the cost, often 15-30% of revenue.
Cross-Industry Applications:
Manufacturing: Finance calculates COPQ including scrap, rework, warranty, inspection. Typical finding: COPQ equals 20-25% of sales
Healthcare: Administrators track costs from complications, readmissions, extended stays. Common discovery: preventable quality issues cost 25-30% of operating budget
Oil & Gas: Operations quantify NPT, rework, incident costs. Industry average: COPQ represents 15-20% of operating costs
Category: Six Sigma Terms
Definition: Method translating customer requirements into technical specifications.
What It Really Means: QFD ensures customer voice drives design decisions. It prevents engineering elegant solutions to the wrong problems.
Cross-Industry Applications:
Manufacturing: Product teams build House of Quality matrices linking customer wants to engineering parameters, prioritize by importance. Typical result: 40-60% reduction in design changes
Healthcare: Service design uses QFD to translate patient needs into operational requirements, ensure alignment. Common outcome: 30-40% improvement in satisfaction scores
Oil & Gas: Equipment design applies QFD converting operator needs to technical specs, validate with users. Industry result: 50-60% reduction in human factor issues
Category: Statistical Terms
Definition: Using statistical methods to monitor and control processes.
What It Really Means: SPC shifts from detecting defects to preventing them. It's like having continuous health monitoring versus annual checkups.
Cross-Industry Applications:
Manufacturing: Every critical process displays real-time SPC charts, operators trained in interpretation, response protocols defined. Typical result: 60-80% reduction in defects
Healthcare: Key clinical metrics tracked on control charts, staff distinguish special from common cause, improve accordingly. Common outcome: 30-40% reduction in adverse events
Oil & Gas: Critical parameters monitored via SPC, automatic alerts for violations, investigation required. Industry standard: 50-60% reduction in process upsets
Category: Statistical Terms
Definition: Natural, random variation inherent in all processes.
What It Really Means: Common cause is process noise—always present, predictable in aggregate. Reacting to it creates chaos.
Cross-Industry Applications:
Healthcare: Leadership recognizes normal daily metric variation, avoids overreacting to random fluctuations, focuses on trends. Typical learning: 70-80% of daily variation is common cause
Manufacturing: Operators trained to expect variation within limits, only adjust for special causes, document all adjustments. Common result: 60-70% reduction in unnecessary adjustments
Oil & Gas: Operations understand normal parameter fluctuations, avoid tampering, maintain stability. Industry practice: reduces process instability 40-50%
Category: Statistical Terms
Definition: Variation from assignable causes outside normal process.
What It Really Means: Special causes are smoke signals—something changed requiring investigation. They're learning opportunities.
Cross-Industry Applications:
Manufacturing: Every special cause signal investigated within 2-4 hours, findings documented, learnings shared. Typical practice: 90% of special causes traced to specific changes
Healthcare: Special cause in quality metrics triggers rapid response team, root cause analysis, corrective action. Common outcome: 80% of special causes preventable
Oil & Gas: Special cause events require immediate investigation, parameter adjustment, documentation. Industry standard: prevents 70-80% of potential incidents
Category: Statistical Terms
Definition: Measure of data spread around the mean.
What It Really Means: Standard deviation quantifies consistency. Smaller means more predictable. Customers hate variation more than average performance.
Cross-Industry Applications:
Manufacturing: Reduce standard deviation even when mean is on target, focus on consistency. Typical result: 50% reduction in complaints despite same average
Healthcare: Monitor procedure time standard deviation, reduce to improve scheduling predictability. Common outcome: 30-40% improvement in OR utilization
Oil & Gas: Track operation time standard deviation, reduce for better planning accuracy. Industry benchmark: 40-50% reduction improves project predictability
Category: Statistical Terms
Definition: Bell curve where most values cluster around mean.
What It Really Means: Normal distribution enables prediction. When processes follow it, statistics becomes powerful.
Cross-Industry Applications:
Healthcare: Verify length of stay normality before using statistical tests, transform data if needed. Common application: capacity planning accuracy improves 25-35%
Manufacturing: Test normality assumption before capability analysis, use appropriate methods for non-normal data. Typical finding: 30-40% of processes require transformation
Oil & Gas: Validate equipment life normality for maintenance planning, adjust strategies for actual distribution. Industry practice: 20-30% improvement in maintenance effectiveness
Category: Statistical Terms
Definition: Chart showing causes in descending order, demonstrating 80/20 rule.
What It Really Means: Pareto focuses effort where it matters. Why fix everything when 20% of causes create 80% of problems?
Cross-Industry Applications:
Healthcare: Pareto analysis of readmissions shows 3-4 diagnoses account for 60-70%, focus interventions there. Typical result: maximum impact with minimum resources
Manufacturing: Defect Pareto reveals 2-3 types cause 75-85% of returns, concentrate improvement efforts. Common outcome: 60-70% reduction focusing on vital few
Oil & Gas: Safety incident Pareto identifies 4-5 behaviors driving 70-80% of events, target training accordingly. Industry result: 50-60% incident reduction
Category: Statistical Terms
Definition: Statistical technique finding relationships between variables.
What It Really Means: Regression separates correlation from causation. It reveals which factors actually drive outcomes.
Cross-Industry Applications:
Manufacturing: Multiple regression identifies 2-3 key factors from 10+ variables, focus control on these. Typical finding: 80% of variation explained by 30% of factors
Healthcare: Regression links operational factors to clinical outcomes, guides resource allocation. Common discovery: unexpected factors often most significant
Oil & Gas: Regression optimizes multiple parameters simultaneously, finds best combinations. Industry practice: 20-30% performance improvement
Category: Statistical Terms
Definition: Statistical decision-making method using data.
What It Really Means: Hypothesis testing prevents expensive mistakes from random variation. It ensures changes represent real improvement.
Cross-Industry Applications:
Healthcare: Test whether interventions actually improve outcomes using appropriate sample sizes, require p<0.05 for adoption. Common practice: prevents 60-70% of ineffective changes
Manufacturing: Validate process improvements statistically before standardizing, avoid random variation traps. Typical requirement: 95% confidence before full implementation
Oil & Gas: Prove safety initiatives effectiveness through proper testing, scale only validated solutions. Industry standard: statistical validation required for all major changes
Category: Statistical Terms
Definition: Range likely containing true population parameter.
What It Really Means: Confidence intervals acknowledge uncertainty. They show not just estimates but precision of those estimates.
Cross-Industry Applications:
Manufacturing: Report capability with 95% confidence intervals, make decisions on lower bound. Typical practice: prevents over-promising on capability
Healthcare: Present quality metrics with confidence intervals, distinguish real from random changes. Common application: 30-40% fewer false alarms
Oil & Gas: Estimate reliability with confidence bounds, plan for worst case. Industry practice: prevents 50-60% of unexpected failures
Category: Statistical Terms
Definition: Probability of observing results if null hypothesis were true.
What It Really Means: P-values help distinguish real effects from random chance. Small p-values suggest something real is happening.
Cross-Industry Applications:
Healthcare: Require p<0.05 for claiming clinical improvements, prevent adoption of random variation. Common standard: reduces ineffective interventions 70-80%
Manufacturing: Use p-values to validate DOE results, only implement statistically significant factors. Typical practice: avoid 60-70% of unnecessary changes
Oil & Gas: Apply p-value criteria for equipment modifications, ensure real improvement. Industry standard: prevents 50% of ineffective modifications
Category: Statistical Terms
Definition: False positive (Type I) and false negative (Type II) statistical errors.
What It Really Means: These errors represent different risks—acting when you shouldn't versus not acting when you should. Balance depends on consequences.
Cross-Industry Applications:
Manufacturing: Balance risk of shipping defects against scrapping good product based on relative costs. Typical optimization: reduces quality costs 20-30%
Healthcare: Design screening protocols balancing false positives (anxiety) against false negatives (missed disease). Common practice: optimize for specific population risks
Oil & Gas: Set alarm limits balancing false alarms (unnecessary shutdowns) against missed problems (incidents). Industry standard: achieve optimal safety-cost balance
Category: Statistical Terms
Definition: Bar chart showing frequency distribution of data.
What It Really Means: Histograms reveal distribution shapes—normal, skewed, bimodal. Shape tells stories about process behavior.
Cross-Industry Applications:
Healthcare: Wait time histograms often show bimodal distributions indicating two patient populations, require different processes. Common finding: 30-40% of problems from mixed populations
Manufacturing: Measurement histograms revealing non-normal distributions indicate special causes or measurement issues. Typical discovery: 25-35% of processes have unexpected distributions
Oil & Gas: Performance histograms by conditions guide operational strategies, optimize for each mode. Industry practice: 20-30% improvement recognizing multimodal operations
Category: Problem-Solving Tools
Definition: Iterative questioning technique drilling to root causes.
What It Really Means: 5 Whys peels back symptom layers to reach systemic causes. Like a child's persistent questioning, it reveals fundamental truths.
Cross-Industry Applications:
Healthcare: Error investigations use 5 whys to move from immediate cause to system issues, typically reaching root cause in 3-7 iterations. Common finding: 80% of root causes are process, not people
Manufacturing: Defect analysis through structured 5 whys, documented at each level, validated with data. Typical outcome: systemic solutions prevent 85-95% recurrence
Oil & Gas: Incident investigations apply 5 whys discipline, test each level's hypothesis, implement systemic fixes. Industry standard: 70-80% reduction in repeat incidents
Category: Problem-Solving Tools
Definition: Tool organizing ideas into natural groupings.
What It Really Means: Affinity diagrams create order from chaos. They reveal patterns in brainstorming data through natural clustering.
Cross-Industry Applications:
Healthcare: Improvement teams sort 100+ ideas into 6-8 natural themes using silent grouping, identify priorities. Typical outcome: chaos becomes actionable categories
Manufacturing: Customer feedback organized through affinity grouping reveals hidden patterns among individual complaints. Common result: 70-80% of issues fall into 4-5 categories
Oil & Gas: Safety suggestions grouped by affinity show common themes across different sites and teams. Industry practice: identifies systemic improvement opportunities
Category: Problem-Solving Tools
Definition: Graph plotting variable pairs to show relationships.
What It Really Means: Scatter diagrams reveal correlations visually. They show whether variables move together, oppositely, or independently.
Cross-Industry Applications:
Manufacturing: Plot process parameters against quality outcomes, identify correlations visually, quantify with correlation coefficients. Typical finding: 2-3 strong correlations from 10+ suspected
Healthcare: Graph staffing levels against quality metrics, identify optimal ranges, guide resource decisions. Common discovery: non-linear relationships often exist
Oil & Gas: Chart operating conditions against performance, identify sweet spots, optimize accordingly. Industry practice: 20-30% improvement targeting optimal zones
Category: Problem-Solving Tools
Definition: Structured form for collecting and analyzing data.
What It Really Means: Check sheets transform observation into data. They ensure consistent, complete data collection for analysis.
Cross-Industry Applications:
Healthcare: Defect location check sheets using body diagrams reveal pattern concentrations, guide targeted improvements. Typical use: makes invisible patterns visible
Manufacturing: Operators mark defect types on product illustrations, patterns emerge visually without analysis. Common outcome: 50% faster problem identification
Oil & Gas: Safety observation check sheets with time/location grids identify high-risk periods and areas. Industry standard: focuses prevention efforts effectively
Category: Problem-Solving Tools
Definition: Line graph displaying data over time sequence.
What It Really Means: Run charts show process trajectory—improving, degrading, or stable. They reveal trends before they become problems.
Cross-Industry Applications:
Manufacturing: Daily metrics on run charts show trends, trigger investigation for 6-7 point runs. Typical capability: detect changes 1-2 weeks before out-of-specification
Healthcare: Weekly quality indicators on run charts distinguish random from real changes, guide improvement focus. Common practice: 30-40% fewer false alarms than point-to-point comparison
Oil & Gas: Hourly performance on run charts identifies degradation before failures, enables preventive action. Industry standard: prevents 40-50% of potential failures
Category: Problem-Solving Tools
Definition: Graphical display showing data distribution through quartiles.
What It Really Means: Box plots compare multiple distributions simultaneously. They reveal medians, spread, and outliers at a glance.
Cross-Industry Applications:
Healthcare: Compare provider performance using box plots, identify consistent versus variable performers, target support. Common application: fair comparison accounting for variation
Manufacturing: Box plots by shift/machine/operator reveal performance differences and variation. Typical finding: variation often more important than average
Oil & Gas: Equipment performance box plots guide maintenance strategies, identify problem units. Industry practice: 30-40% better reliability focus
Category: Problem-Solving Tools
Definition: Framework categorizing customer requirements by satisfaction impact.
What It Really Means: Kano reveals that not all requirements are equal. Some features delight, others are expected, some are indifferent.
Cross-Industry Applications:
Manufacturing: Product features classified through customer research: basic needs must be met, performance features compete, delighters differentiate. Typical finding: 20% of features drive 80% of satisfaction
Healthcare: Patient needs categorized show clinical outcomes are basic, wait times are performance, amenities are delighters. Common application: balanced improvement portfolio
Oil & Gas: Equipment features analyzed reveal safety is basic, efficiency is performance, automation is delighter. Industry practice: appropriate investment allocation
Category: Problem-Solving Tools
Definition: Robust design approach minimizing variation from uncontrollable factors.
What It Really Means: Taguchi makes processes robust against real-world variation. It designs in insensitivity to things you can't control.
Cross-Industry Applications:
Manufacturing: Products designed using Taguchi methods perform consistently despite customer use variation. Typical result: 40-60% reduction in field failures
Healthcare: Protocols developed with Taguchi principles work despite staff and patient variation. Common outcome: 30-40% less outcome variation
Oil & Gas: Procedures designed for robustness succeed despite environmental and equipment variation. Industry standard: 50% reduction in weather-related delays
Category: Problem-Solving Tools
Definition: Problem specification technique defining boundaries.
What It Really Means: Is/Is Not prevents scope creep and focuses investigation. It clearly defines what's in and out of bounds.
Cross-Industry Applications:
Healthcare: Outbreak investigations use Is/Is Not to bound the problem: which units, which patients, which timeframe. Typical result: 50% faster root cause identification
Manufacturing: Defect analysis through Is/Is Not: which products, which machines, which shifts. Common outcome: eliminates 60-70% of suspected causes immediately
Oil & Gas: Incident analysis via Is/Is Not: which equipment, which conditions, which crews. Industry practice: focuses investigation saving 40% of analysis time
Category: Problem-Solving Tools
Definition: Democratic prioritization technique for group decisions.
What It Really Means: Multi-voting combines democracy with focus. Teams narrow many options to vital few through structured voting.
Cross-Industry Applications:
Manufacturing: Teams use dot voting to prioritize improvement opportunities, each member gets votes equal to 30% of options. Typical result: consensus on top 20% of ideas
Healthcare: Staff multi-vote on quality initiatives using importance/feasibility criteria, focus on high-impact/low-effort. Common outcome: 80% agreement on priorities
Oil & Gas: Crews prioritize safety improvements through multi-voting, weight by risk reduction potential. Industry practice: democratic buy-in for changes
Category: Performance Metrics
Definition: Availability × Performance × Quality measuring equipment productivity.
What It Really Means: OEE reveals hidden capacity. Most equipment operates at 40-60% OEE, meaning massive improvement potential exists.
Cross-Industry Applications:
Manufacturing: World-class OEE targets: 90% availability, 95% performance, 99% quality = 85% OEE. Typical progression: from 45% to 65-75% in year one
Healthcare: Imaging equipment OEE calculation reveals scheduling, speed, and repeat scan losses. Common improvement: from 50% to 70% adding capacity without investment
Oil & Gas: Rig OEE analysis identifies invisible lost time between operations, maintenance delays, rework. Industry average: 55-65% with potential for 75-80%
Category: Performance Metrics
Definition: Percentage of units meeting specifications without rework.
What It Really Means: FPY exposes hidden factories—all the fixing happening behind the scenes. High final yield with low FPY means massive waste.
Cross-Industry Applications:
Manufacturing: Track FPY at each step revealing rework loops, eliminate root causes. Typical finding: 60% FPY creates 95% final yield through rework
Healthcare: Monitor care process FPY including readmissions and complications, focus on right-first-time. Common discovery: true FPY 30-40% below perceived quality
Oil & Gas: Measure operational FPY excluding all remedial work, optimize for first-pass success. Industry benchmark: improving FPY from 70% to 90% doubles profitability
Category: Performance Metrics
Definition: Time to complete one process cycle from start to finish.
What It Really Means: Cycle time drives everything—cost, quality, flexibility. Halving cycle time typically doubles productivity and cash flow.
Cross-Industry Applications:
Healthcare: Emergency department cycle time from arrival to disposition, focus on rate-limiting steps. Typical improvement: 30-40% reduction saves lives and capacity
Manufacturing: Measure cycle time at bottleneck operations, any improvement there improves entire system. Common result: 20-30% throughput increase
Oil & Gas: Track drilling cycle time per section, optimize parameters for each formation type. Industry average: 25-35% time reduction worth millions
Category: Performance Metrics
Definition: Total time from order to delivery including queue time.
What It Really Means: Lead time determines customer satisfaction and working capital. Most lead time is waiting, not working.
Cross-Industry Applications:
Manufacturing: Value stream analysis typically reveals 95% of lead time is waiting, systematic elimination reduces dramatically. Common achievement: 8 weeks to 1 week
Healthcare: Patient journey lead time from referral to treatment, mostly waiting for appointments. Typical improvement: 50-70% reduction through flow redesign
Oil & Gas: Equipment procurement lead time analysis shows 80% is approvals and queuing. Industry practice: 40-50% reduction through process improvement
Category: Performance Metrics
Definition: Rate of production or service delivery over time.
What It Really Means: Throughput reveals true capacity. Constraints determine system throughput—improve the bottleneck or nothing improves.
Cross-Industry Applications:
Healthcare: Emergency department throughput limited by physician availability, not bed count, adjust accordingly. Typical result: 20-30% throughput increase without adding resources
Manufacturing: Identify constraint through throughput analysis, subordinate everything to constraint needs. Common outcome: 25-40% output increase
Oil & Gas: Drilling throughput analysis reveals connection time as limiter, implement parallel activities. Industry benchmark: 20-30% footage increase per day
Category: Performance Metrics
Definition: Inventory between process start and completion.
What It Really Means: WIP hides problems and ties up cash. Reducing WIP exposes issues and accelerates improvement.
Cross-Industry Applications:
Manufacturing: Implement WIP limits between operations forcing problems to surface. Typical result: 50-70% WIP reduction frees millions in cash
Healthcare: Limit patients in process to smooth flow, reduce crowding, improve experience. Common outcome: 30-40% reduction in department congestion
Oil & Gas: Control maintenance WIP through visual systems, jobs complete faster with less chaos. Industry practice: 40-50% improvement in completion predictability
Category: Performance Metrics
Definition: Lead Time = WIP ÷ Throughput mathematical relationship.
What It Really Means: Little's Law proves you can't have it all—short leads, high WIP, and high throughput. Something must give.
Cross-Industry Applications:
Healthcare: Apply Little's Law to prove either reduce patients in department or increase throughput to reduce waits. Universal truth: math doesn't lie
Manufacturing: Use to calculate WIP limits for target lead times, adjust based on throughput capability. Typical application: predictable delivery performance
Oil & Gas: Calculate optimal project portfolio size using Little's Law, balance workload with capacity. Industry result: 30-40% improvement in project delivery
Category: Performance Metrics
Definition: Value-added time divided by total lead time.
What It Really Means: PCE reveals waste magnitude. Most processes operate at <5% PCE, meaning 95% waste opportunity.
Cross-Industry Applications:
Manufacturing: Detailed time studies typically show 1-3% PCE, systematic waste elimination improves to 10-20%. Common potential: 5-10x productivity improvement
Healthcare: Patient journey PCE analysis often reveals <10% value-added time, redesign for flow. Typical improvement: from 5% to 15-20% PCE
Oil & Gas: Drilling PCE shows 30-40% of time actually making hole, eliminate non-drilling time systematically. Industry benchmark: achieve 50-60% PCE
Category: Performance Metrics
Definition: Comparison of customer demand rate to actual production rate.
What It Really Means: This comparison reveals whether you're overproducing (waste) or underproducing (delays). Balance prevents both.
Cross-Industry Applications:
Healthcare: Match provider capacity to patient arrival patterns, adjust staffing when mismatched. Typical result: eliminates both overtime and delays
Manufacturing: Display takt versus actual cycle time visually, operators self-adjust pace. Common outcome: 20-30% improvement in delivery performance
Oil & Gas: Balance operational pace with plan requirements, prevent rushing and waiting. Industry standard: 25-35% reduction in time variation
Category: Performance Metrics
Definition: Identification and optimization of constraining process steps.
What It Really Means: Bottlenecks determine system capacity. An hour lost at bottleneck is an hour lost forever.
Cross-Industry Applications:
Manufacturing: Theory of Constraints analysis identifies single constraint, focus all improvement there. Typical result: 30-50% capacity increase without investment
Healthcare: Patient flow analysis reveals registration, not treatment, as bottleneck. Common outcome: addressing true bottleneck improves entire system 25-35%
Oil & Gas: Operation sequencing shows specific equipment as constraint, optimize utilization. Industry practice: 20-30% throughput improvement
Category: Certification & Roles
Definition: Basic awareness level understanding Lean Six Sigma fundamentals.
What It Really Means: White Belts speak the language. They understand enough to support projects and identify opportunities.
Cross-Industry Applications:
Healthcare: All staff receive 4-8 hour White Belt training covering basics and organization-specific applications. Typical result: 30-40% increase in improvement suggestions
Manufacturing: Operators complete online White Belt training, understand their role in improvements. Common outcome: better project participation and support
Oil & Gas: Entire crews receive White Belt awareness, recognize improvement opportunities daily. Industry practice: foundation for cultural transformation
Category: Certification & Roles
Definition: Foundational knowledge enabling project participation and support.
What It Really Means: Yellow Belts are informed team members. They contribute to projects without leading them.
Cross-Industry Applications:
Manufacturing: Technicians earn Yellow Belt through 16-24 hour training, participate effectively in teams. Typical contribution: data collection and basic analysis
Healthcare: Clinical staff achieve Yellow Belt certification, identify opportunities, support Green Belt projects. Common result: 40-50% of improvements from Yellow Belt observations
Oil & Gas: Field operators certified as Yellow Belts, participate in problem-solving, implement solutions. Industry outcome: frontline engagement in improvement
Category: Certification & Roles
Definition: Part-time improvement leaders managing smaller-scope projects.
What It Really Means: Green Belts are the improvement army. Working part-time on projects, they create most organizational momentum.
Cross-Industry Applications:
Healthcare: Charge nurses complete 80-100 hour Green Belt training, lead unit-based projects saving $50-150K annually. Typical certification rate: 5-10% of professional staff
Manufacturing: Engineers become Green Belts while maintaining regular duties, complete 2-4 projects annually. Common impact: $100-200K savings per belt per year
Oil & Gas: Supervisors earn Green Belt certification, lead crew-driven improvements, bridge management and field. Industry standard: 1-2 Green Belts per operational unit
Category: Certification & Roles
Definition: Full-time improvement experts leading complex cross-functional projects.
What It Really Means: Black Belts combine technical mastery with change leadership. They tackle million-dollar problems spanning departments.
Cross-Industry Applications:
Manufacturing: Black Belts complete 160-200 hours training, lead 4-6 major projects annually, save $500K-1M each. Typical ratio: 1 Black Belt per 100 employees
Healthcare: Black Belts focus on system-wide issues, lead multidisciplinary teams, achieve breakthrough improvements. Common deployment: 1-2 per major service line
Oil & Gas: Black Belts optimize across multiple assets, transfer best practices, solve chronic problems. Industry practice: 1 Black Belt per $100M revenue
Category: Certification & Roles
Definition: Expert coaches developing Black Belts and deployment strategy.
What It Really Means: Master Black Belts multiply capability. They teach teachers, ensuring methodology consistency and evolution.
Cross-Industry Applications:
Healthcare: Master Black Belts adapt training for clinical context, coach physician champions, ensure methodology relevance. Typical ratio: 1 MBB per 10 Black Belts
Manufacturing: MBBs lead enterprise deployment, develop internal certification, advance methodology. Common structure: 1 MBB per business unit
Oil & Gas: MBBs standardize global practices, ensure consistent application, develop company-specific tools. Industry standard: 1 MBB per major operational area
Category: Certification & Roles
Definition: Executive leaders enabling projects through resources and barrier removal.
What It Really Means: Champions determine success. Without executive sponsorship, even perfect solutions fail.
Cross-Industry Applications:
Healthcare: Physician executives champion clinical improvements, remove political barriers, ensure adoption. Critical factor: active champions triple project success rates
Manufacturing: Plant managers champion projects, attend reviews monthly, clear obstacles quickly. Typical requirement: 4-6 hours monthly per project
Oil & Gas: Asset managers champion safety improvements, provide resources, celebrate successes. Industry reality: 90% of successful projects have engaged champions
Category: Implementation Terms
Definition: Structured thinking documented on single 11x17 sheet.
What It Really Means: A3 forces clarity through constraint. Limited space eliminates fluff, focusing on facts and actions.
Cross-Industry Applications:
Healthcare: Units use standard A3 templates for all problems, complete collaboratively, post for visibility. Typical result: 70-80% of problems resolved at unit level without escalation
Manufacturing: Engineers document improvements on A3s, review in daily walks, share across shifts. Common practice: creates organizational memory and learning
Oil & Gas: Crews complete A3s for incidents and near-misses, display publicly, discuss at handovers. Industry outcome: 50-60% reduction in repeat issues
Category: Implementation Terms
Definition: Phase-gate reviews ensuring project requirements are met.
What It Really Means: Tollgates prevent project drift. They catch problems early when fixes are cheap.
Cross-Industry Applications:
Manufacturing: Projects require tollgate approval to proceed, must meet defined criteria, resources released by phase. Typical impact: 85-90% project success rate versus 50% without
Healthcare: Improvement teams present to leadership at phase gates, receive guidance, adjust approach. Common practice: monthly tollgate rhythm
Oil & Gas: Major projects require technical authority tollgate approval, ensure safety and quality built in. Industry standard: prevents 80% of project failures
Category: Implementation Terms
Definition: Document defining project scope, goals, and success metrics.
What It Really Means: Charters are contracts preventing scope creep. They ensure everyone agrees what success looks like upfront.
Cross-Industry Applications:
Healthcare: All improvements require one-page charter signed by sponsor, reviewed weekly. Typical content: problem statement, goal, scope, timeline, team
Manufacturing: Charters include business case, resource commitment, success metrics. Common result: 30-40% faster project completion
Oil & Gas: Safety project charters define specific targets, boundaries, stakeholders. Industry practice: prevents 60-70% of scope creep
Category: Implementation Terms
Definition: Systematic mapping of individuals affected by changes.
What It Really Means: Stakeholder analysis prevents surprise resistance. It maps political landscape for successful navigation.
Cross-Industry Applications:
Manufacturing: Teams create power/interest grids, develop targeted engagement plans. Typical finding: 30-40% of stakeholders initially overlooked
Healthcare: Map clinical and operational stakeholders, understand concerns, address proactively. Common result: 50% reduction in implementation resistance
Oil & Gas: Identify all contractors, partners, regulators affected, engage early. Industry practice: reduces project delays 40-50%
Category: Implementation Terms
Definition: Structured approach to transitioning people through change.
What It Really Means: Change management addresses the human side. Technical solutions fail without human adoption.
Cross-Industry Applications:
Healthcare: Use ADKAR model for clinical changes: Awareness, Desire, Knowledge, Ability, Reinforcement. Typical adoption: 85-95% with structured approach versus 30-50% without
Manufacturing: Apply Kotter's 8 steps for transformational change, build coalition, celebrate wins. Common timeline: 12-18 months for culture shift
Oil & Gas: Implement changes with crew involvement from design through execution. Industry result: 70-80% voluntary adoption versus forced compliance
Category: Implementation Terms
Definition: Radical improvement through breakthrough change.
What It Really Means: Kaikaku is revolution, not evolution. When incremental won't suffice, kaikaku rebuilds from scratch.
Cross-Industry Applications:
Manufacturing: Complete production line redesign over shutdown, all new flow and technology. Typical result: 3-5x improvement versus 20-30% from kaizen
Healthcare: Redesign entire care pathways from ground up, eliminate all non-value steps. Common outcome: 50-70% reduction in cycle time
Oil & Gas: Revolutionary change from reactive to predictive maintenance, new systems and processes. Industry impact: 80-90% reduction in failures
Category: Implementation Terms
Definition: Responsibility assignment matrix: Responsible, Accountable, Consulted, Informed.
What It Really Means: RACI eliminates role confusion. It clearly defines who does what, preventing gaps and overlaps.
Cross-Industry Applications:
Healthcare: Discharge process RACI clarifies roles across departments, eliminates delays from confusion. Typical result: 30-40% reduction in discharge time
Manufacturing: New product launch RACI defines cross-functional responsibilities clearly. Common outcome: 50% fewer issues from missed handoffs
Oil & Gas: Turnaround RACI coordinates multiple contractors, prevents duplication and gaps. Industry standard: 20-30% improvement in execution efficiency
Category: Implementation Terms
Definition: Compelling reason for change creating urgency.
What It Really Means: Burning platforms overcome inertia. When status quo becomes more dangerous than change, movement happens.
Cross-Industry Applications:
Manufacturing: Market share loss creates platform for transformation, survival requires change. Typical catalyst: 20-30% revenue decline drives action
Healthcare: Public quality rankings create urgency for improvement, reputation at stake. Common trigger: below-average performance published
Oil & Gas: Major incident creates imperative for safety transformation, no resistance remains. Industry pattern: serious incident drives 2-3 year transformation
Category: Implementation Terms
Definition: Early, visible improvements building momentum.
What It Really Means: Quick wins prove methodology works. They convert skeptics and fund larger improvements.
Cross-Industry Applications:
Healthcare: Start with supply room 5S showing immediate visual impact, gain staff buy-in. Typical timeline: visible results within 2 weeks
Manufacturing: Fix obvious safety hazards first, build trust for harder changes. Common practice: 3-5 quick wins in first 30 days
Oil & Gas: Implement simple time-savers immediately, crews request more. Industry approach: 10-15% improvement from quick wins funds program
Category: Implementation Terms
Definition: Small-scale trials before full implementation.
What It Really Means: Pilots reduce risk through learning. Fail small and cheap rather than big and expensive.
Cross-Industry Applications:
Manufacturing: Test process changes on one line for 30 days, refine before plant-wide rollout. Typical practice: 70-80% of pilots modified before scaling
Healthcare: Pilot protocols on single units, adjust based on results, then spread. Common approach: 60-90 day pilots before system deployment
Oil & Gas: Test procedures on single equipment in controlled conditions, validate safety. Industry standard: all major changes piloted first
Category: Implementation Terms
Definition: Behind-scenes consensus building before formal decisions.
What It Really Means: Nemawashi ensures decisions stick. By building agreement informally first, formal meetings become confirmations, not battles.
Cross-Industry Applications:
Healthcare: Meet individually with key physicians before committees, address concerns privately, achieve consensus. Typical result: 90% approval rate versus 50% without
Manufacturing: Discuss with union representatives informally first, understand concerns, modify proposals. Common outcome: labor support versus resistance
Oil & Gas: Engage key contractors before announcing changes, incorporate feedback, ensure buy-in. Industry practice: reduces implementation time 40-50%
After 101 terms, one truth emerges across all industries:
Excellence isn't complicated. It's consistent.
Whether reducing defects in semiconductors, infections in hospitals, or incidents on platforms, the principles remain identical. Reduce variation. Eliminate waste. Engage people. Use data. Improve continuously.
The tools have Japanese names, statistical foundations, and industry-specific applications. But underneath, they all serve the same master: the relentless pursuit of perfection through imperfect steps forward.
Master these 101 terms, and more importantly, master the patterns they represent. Because once you see the patterns, you can improve anything.
Lean focuses on speed and flow by eliminating waste. Six Sigma focuses on quality and consistency by reducing variation. Lean makes processes faster; Six Sigma makes them better. Most organizations need both, which is why Lean Six Sigma integration has become standard.
Start with Yellow Belt for awareness, then Green Belt for practical application. Green Belt provides sufficient depth to lead meaningful projects while maintaining your regular job. Black Belt makes sense only if transitioning to full-time improvement work.
Every term applies to services—only the application changes. Value streams exist in loan processing as clearly as assembly lines. Defects occur in customer service as measurably as manufacturing. The principles of flow, variation reduction, and waste elimination are universal.
Standard Work might be the most fundamental. Without standardization, improvement is impossible—you're improving chaos. Standard Work provides the stable foundation upon which all other improvements build.
Toyota pioneered many Lean concepts, and Japanese terms carry specific cultural meanings that English translations miss. "Kaizen" implies more than "continuous improvement"—it includes respect, humility, and collective responsibility that shaped Toyota's success.
Understanding terms takes weeks. Applying tools takes months. Mastering underlying thinking takes years. However, organizations typically see initial results within 30-60 days, significant improvements within 6 months, and cultural transformation within 18-24 months.
"Excellence speaks a universal language. These 101 terms are your translator.
Master the vocabulary, recognize the patterns, and you'll transform any operation in any industry."
🎓 Explore Certification Pathways Read: "Complete Guide to Lean Six Sigma Belts: Your Path from White to Master Black Belt"
🏭 See Real Applications Discover: "Cross-Pollination: How Oil Rig Safety Protocols Save Lives in Hospitals"
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35+ years of worldwide operational excellence experience across oil & gas, healthcare, and manufacturing. Focuses on practical implementation that delivers sustainable results, rather than just theoretical models.
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Copyright ©️ 2025 Maria Milo | Real Insights From the Field
CEO at Variance Reduction International (VRI) | Serving Oil & Gas, Healthcare, and Manufacturing Globally
www.VarianceReduction.com | Houston, Texas | USA