A very elemental objective for every business is (or should be) increasing customer/user satisfaction while also decreasing costs. But this simple idea is not necessarily simple to achieve. If it were, more companies would be profitable and stay in business. For organizations whose products or outputs are the results of repetitive processes, implementing the Six Sigma method can mean the difference between barely making your margins and being hugely profitable, between failure and success.
Simply put, Six Sigma is a method for deploying chronologically-linked rational and statistical tools in order to bring about targeted improvement of repetitive processes in production and service. Read on for more information and 8 Tips to help your organization get started on its process improvement journey.
What are the processes in your organization?
Each value of a company is created in a process. An input (e.g. an order, ingredients) is transformed into an output (e.g. a cookie) by activities. The activities are guided by methods (e.g. a recipe, hygiene standards) and executed by resources (e.g. a chef, scale, oven). Every process follows this structure.
Within your organization’s processes, what problems can be solved?
Six Sigma projects start with a specific problem of the output. If the cookies taste bad, have too many calories or too much weight (quality problem), are delivered too late, the quantity is not sufficient (availability problem) or the energy consumption and the working hours are too high (consumption problem), then these problems (Y) provide anchor points for a Six Sigma project.
Every form we fill out, every answer we give, every decision we make and every preliminary product we create is an output. If at least 30 outputs are created per month, then the process is suitable for Six Sigma. With that benchmark in mind, you can even apply Six Sigma activities you perform daily in your personal life, like brushing your teeth. The best-practice has, in fact, been defined for this process in order to achieve optimum output. And everyone knows the problems and costs that can result from bad dental hygiene!
Six Sigma certification holders of all levels are stakeholders in improving the quality and efficiency of operations in their organizations, with Yellow and Green Belts contributing more at the tactical and project management levels and Black Belts and Master Black Belts driving improvement from the strategic and leadership perspectives. Regardless, Six Sigma projects typically follow the same process:
- Experts identify and evaluate the methods, resources and inputs (x) of the process to determine the triggering influences of the bad tasting cookies (Y)
- Inputs (x) and problems (Y) are measured for about 1 month
- The data is statistically evaluated to identify the root causes (x’) of the triggering influences
- Solutions are implemented to eliminate, circumvent or adjust the root causes (x’)
- Data are measured again to assess the success and prove the financial and other benefits
- Finally, the process owner receives tools to monitor the process and a reaction plan for new problems to ensure sustainability
Given the significant financial benefits to organizations implementing Six Sigma certification projects, it’s not surprising that an increasing number of companies are developing these skill sets and expertise among their workforces.
Eight Tips for Getting Started with Six Sigma
- Challenges and problems
Managers don't like problems, but they love challenges. From a Six Sigma perspective, it makes no difference whether you sometimes brush the bar today in terms of quality or whether you want to raise the bar to provide more outputs tomorrow with the resources available. Six Sigma analyzes the determinants of today's performance and seeks solutions to improve it.
- Sources for Six Sigma projects
At the beginning of Six Sigma, it is sometimes difficult to identify suitable topics for projects. But there are four sources: Management (performance indicators and target achievements), Customer (ratings and complaints), Employees (observations and clarifications) and Systems (suggestion system and results from value stream analyzes). Filter this information according to their relevance to important processes/outputs, assess their potential and prioritize them. These can be your topics for Six Sigma.
- Improve process chains upstream
Focus on complete process chains, from the last output that leaves the company to the first input that the company receives. Split the process chain into functional units and start the first project with the last output. This is where all deviations in quality, availability and consumption accumulate. Solve these problems as far as possible and start the next project with its input, which is the output of the upstream process step. Work your way upstream to your first input and integrate the supplier of this output into the last project of this process chain.
- Monitor process performance
The sigma level is a dimensionless measure to determine the process performance. At project start we often measure negative sigma levels. And Six Sigma is a vision, rarely a goal for the next year. If, however, all (intermediate) outputs of a process chain are evaluated according to the same performance measure and monitored by comparable control charts, then the probability of cooperation across departments increases. Because everyone is pulling in the direction of the common performance indicator.
- Standardize the methods
Many companies only document the activities of processes. The methods used are rarely mentioned. And practice shows that many activities are carried out according to personal expertise and preferences. This is understandable in innovative and creative processes, but not in standard processes where different chefs bake their cookies without a recipe. It is the methods that bring intelligence and hopefully even best practice into the process.
- Unmask solutions that are disguised as causes
Only causes of problems are suitable interfaces for solutions. How do you react when an employee tells you: "I came to work too late today because I don't have a Ferrari"? – This explanation is of course nonsense, because the Ferrari is not a cause, but a solution that does not (yet) exist. Please pay attention to how often problems are explained by desired solutions. You can identify them by negations containing the prefix: un- or the words: no or not. In my experience, there are many Ferraris in companies although no one has ever observed how a non-existent Ferrari led to a delay.
- Acknowledge success
Jack Welch once explained how he managed to make Six Sigma so successful at General Electric by saying: “You have to reward it.” I know of incentive systems where Belts participate proportionately in the savings of their project. With reward comes motivation to complete more projects which, in turn, deliver more benefits and process improvements to the company and help Belts build even more experience. A win-win proposition.
- General fitness and specific treatments
Six Sigma and Lean Thinking do not compete but, rather, complement each other. Lean thinking is suitable for increasing the fitness of processes. Improvements of the process are based on concrete, scientifically proven recommendations: Do this and leave that. This widely increases the quality and availability of the outputs and reduces their consumption of inputs and resources. Six Sigma is the treatment for specific problems of the outputs. It develops tailored solutions for their causes in the process.
Learn more about how you can implement Six Sigma and Lean to improve your processes and bottom line.
About the Author:
Dr. Reiner Hutwelker, Six Sigma Master Black Belt, formerly Siemens Management Consulting, today consultant, trainer and coach for process improvements by Six Sigma and Lean with more than 25 years of experience in production and services, Senior Lecturer at TU Munich.