Beyond Lean Six Sigma Driving Sustainable Results in Financial Service

Almost everyone remembers the tech bubble bursting in 2000. Most people become astutely aware of the effects of a languishing stock market when they view their investment returns. But nobody knows better about these tough times than the insiders who worked in the financial industry these past five years. There are a few bright spots. M&A, investment banking, fixed income and hedge funds have all seen occasional splurges of activity. But for the most part, the financial service industry has not yet returned to the heydays of the late 90’s. On the contrary, many firms are concerned with their overall profitability. They are trying everything to improve their bottom line: business process redesign, EVA, pricing optimization, customer profitability, advanced reporting, accountability programs, ABC, Balanced Scorecard, and now Lean Six Sigma. In this paper, we will spotlight the success of one company using Lean Six Sigma. We will then showcase what we believe to be the ultimate solution – Time-Driven ABC. This white paper is an absolute must read for any company in the financial industry considering implementing Lean Six Sigma. It could dramatically improve Six Sigma’s success.

Case Study: HSBC US Futures Business:

In 2002, Dan Stusnick, a SVP Certified Six Sigma Black Belt, was called in to help identify opportunities to significantly improve the bottom line of the U.S. Futures unit at HSBC Securities. While trading activity had become more electronic, the operating model and infrastructure to support it had not changed. The difficulty for Dan, however, was that there were good customers within both models. The net result for Futures was a higher cost structure to support an overall business with declining margins. Something had to be done. Dan remarks, "By charting a project focused on a cost/income metric, U.S. Futures committed their business to a broad Quality Initiative with a mandate to look at all of the factors contributing to bottom line performance." However, Dan realized that identifying the root cause was only half the problem. He would also need the commitment from US Futures to make the necessary changes, and stick to them.

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