Six Sigma has been applied successfully to virtually any industry.
Key elements of Six Sigma
There are three key elements of Six Sigma Process Improvement:
Customers define quality.
They expect performance, reliability, competitive prices, on-time delivery, service, clear and correct transaction processing and more.
This means it is important to provide what the customers need to gain customer delight.
Defining processes as well as defining their metrics and measures is the central aspect of Six Sigma.
In a business, the quality should be looked from the customer’s perspective and so we must look at a defined process from the outside-in.
By understanding the transaction lifecycle from the customer’s needs and processes, we can discover what they are seeing and feeling. This gives a chance to identify weak areas with in a process and then we can improve them.
A company must involve all its employees in the Six Sigma program.
Company must provide opportunities and incentives for employees to focus their talents and ability to satisfy customers.
It is important to Six Sigma that all the team members should have a well-defined role with measurable objectives.
Organizational Roles in Six Sigma
Under a Six Sigma program, the members of an organization are assigned specific roles to play, each with a title. This highly structured format is necessary in order to implement Six Sigma throughout the organization.
There are seven specific responsibilities or “role areas” in a Six Sigma program, which are as follows.
A leadership team or council defines the goals and objectives in the Six Sigma process.
Just as a corporate leader sets a tone and course to achieve an objective, the Six Sigma council sets the goals to be met by the team.
Here is the list of Leadership Council Responsibilities:
Defines the purpose of the Six Sigma program
Explains how the result is going to benefit the customer
Sets a schedule for work and interim deadlines
Develops a mean for review and oversight
Support team members and defend established positions
Six Sigma sponsors are high-level individuals who understand Six Sigma and are committed to its success. The individual in the sponsor role acts as a problem solver for the ongoing Six Sigma project.
Six Sigma is generally led by a full-time, high level champion, such as an Executive Vice President.
Sponsors are the owners of processes and systems, who help initiate and coordinate Six Sigma improvement activities in their areas of responsibilities.
The person responsible for supervising the Six Sigma team effort, who supports the leadership council by ensuring that the work of the team is completed in the desired manner, is the Implementation Leader.
Ensuring success of the implementation plan and solving problems as they arise, training as needed, and assisting sponsors in motivating the team are some of the key responsibilities of an implementation leader.
Coach is a Six Sigma expert or consultant who sets a schedule, defines result of a project, and who mediates conflict, or deals with resistance to the program.
Duties include working as a go-between for sponsor and leadership, scheduling the work of the team, identifying and defining the desired results of the project, mediating disagreements, conflicts, and resistance to the program and identifying success as it occurs.
It is an individual responsible for overseeing the work of the team and for acting as a go-between with the sponsor and the team members.
Responsibilities include communication with the sponsor in defining project goals and rationale, picking and assisting team members and other resources, keeping the project on schedule, and keeping track of steps in the process as they are completed.
An employee who works on a Six Sigma project, given specific duties within a project, and has deadlines to meet in reaching specific project goals.
Team members execute specific Six Sigma assignments and work with other members of the team within a defined project schedule, to reach specifically identified goals.
The individual who takes on responsibility for a process after a Six Sigma team has completed its work.
Extended Definitions of Roles – Belt Colors
The assignment of belt colors to various roles is derived from the obvious source, the martial arts. Based on experience and expertise, following roles have evolved over the years.
Note: The belt names are a tool for defining levels of expertise and experience. They do not change or replace the organizational roles in the Six Sigma process.
The person possessing this belt has achieved the highest skill level and is an experienced expert in various techniques. As applied to the Six Sigma program, the individual designated as a Black Belt has completed a thorough internal training program and has the experience of working on several projects.The black belt holder is usually given the role of a team leader, the person who is responsible for execution and scheduling.
MASTER BLACK BELT
A person who deals with the team or its leadership; but is not a direct member of the team itself. This may be equivalent to the role played by the coach, or for more technical and complex projects. The Master Black Belt is available to answer procedural questions and to resolve the technical issues that come up.
The Green Belt designation can also belong to the team leader or to a member of the team working directly with the team leader. A Green Belt is less experienced than a Black Belt but is cast in a key role within the team.
Assessing Readiness for Six Sigma.
The starting point in gearing up for Six Sigma is to verify if you are ready to embrace a change that says, “There is a better way to run your organization.”
There are a number of essential questions and facts that you need to consider in making a readiness assessment:
Is the strategic course clear for the company?
Is the business healthy enough to meet the expectations of analysts and investors?
Is there a strong theme or vision for the future of the organization that is well understood and consistently communicated?
Is the organization good at responding effectively and efficiently to new circumstances?
Evaluating current overall business results.
Evaluating how effectively do we focus on and meet customers’ requirements.
Evaluating how effectively are we operating.
How effective are your current improvement and change management systems?
How well are your cross-functional processes managed?
What other change efforts or activities might conflict with or support Six Sigma initiative?
Six Sigma demands investments.
If you cannot make a solid case for future or current return, then it may be better to stay away.
If you already have in place a strong, effective, performance and process improvement offer, then why do you need Six Sigma?
There could be many questions to be answered to have an extensive assessment before deciding if you should go for Six Sigma or not.
This may need time and a thorough consultation with Six Sigma Experts to take a better decision.
The Cost of Six Sigma Implementation
Some of the most important Six Sigma budget items can include the following:
Direct Payroll for the individuals dedicated to the effort full time.
Indirect Payroll for the time devoted by executives, team members, process owners and others, involved in activities like data gathering and measurement.
Training and Consultation fee to teach Six Sigma Skills and getting advice on how to make efforts successful.
Improvement Implementation Cost.
Six Sigma Start-up
Now you have decided to go for Six Sigma.
So what is next?
Deploying Six Sigma within an organization is a big step and involves many activities including define, measure, analyze, improve, and control phases.
Here are some steps, which are required for an organization at the time of starting Six Sigma implementation.
- Plan your own route:
There may be many paths to Six Sigma but the best is the one that works for your organization.
2. Define your objective:
It is important to decide what you want to achieve, and priorities are important.
3. Stick to what is feasible:
Set up your plans so that they can match your influences, resources and scope.
4. Preparing Leaders:
They are required to launch and guide the Six Sigma Effort.
5. Creating Six Sigma organization:
This includes preparing Black Belts and other roles and assigning them their responsibilities.
6. Training the organization:
Apart from having black belts, it is required to impart training of Six Sigma to all the employees in the organization.
7. Piloting Six Sigma effort:
Piloting can be applied to any aspect of Six Sigma including solutions derived from process improvement or design redesign projects.
Project Selection for Six Sigma
One of the most difficult challenge in Six Sigma is the selection of the most appropriate problem to attack. There are generally two ways to generate projects:
This approach is generally tied to business strategy and is aligned with customer needs. The major weakness is they are too broad in scope to be completed in a timely manner (most six sigma projects are expected to be completed in 3-6 months).
In this approach, Black Belts choose the projects that are well suited for the capabilities of teams. A major drawback of this approach is that, projects may not be tied directly to strategic concerns of the management thereby, receiving little support and low recognition from the top.
Six Sigma has two key methodologies:
It refers to a data-driven quality strategy for improving processes.
This methodology is used to improve an existing business process.
It refers to a data-driven quality strategy for designing products and processes.
This methodology is used to create new product designs or process designs in such a way that it results in a more predictable, mature and defect free performance.
There is one more methodology called DFSS – Design For Six Sigma.
DFSS is a data driven quality strategy for designing or redesigning a product or service from the ground up.
Sometimes a DMAIC project may turn into a DFSS project because the process in question requires complete redesign to bring about the desired degree of improvement.
This methodology consists of the following five steps.
Define –> Measure –> Analyze –> Improve –> Control
Define the problem or project goal that needs to be addressed.
Measure the problem and process from which it was produced.
Analyze data and process to determine root cause of defects and opportunities.
Improve the process by finding solutions to fix, diminish, and prevent future problems.
Implement, control, and sustain the improvement solutions to keep the process on the new course.
This methodology consists of five steps:
Define –> Measure –> Analyze –> Design –>Verify
Define the Problem or Project Goal that needs to be addressed.
Measure and determine customers’ needs and specifications.
Analyze the process to meet the customer needs.
Design a process that will meet customers’ needs.
Verify the design performance and ability to meet customer needs.
DFSS is a separate and emerging discipline related to Six Sigma quality processes.
This is a systematic methodology utilizing tools, training, and measurements to enable us to design products and processes that meet customer expectations and can be produced at Six Sigma Quality levels.
This methodology can have the following five steps.
Define –> Identify –> Design –> Optimize –> Verify
Define what the customers want, or what they do not want.
Identify the customer and the project.
Design a process that meets customers’ needs
Determine process capability and optimize the design.
Test, verify, and validate the design.
There are five high-level steps in the application of Six Sigma to improve the quality of output. The first step is Define.
During the Define phase, four major tasks are undertaken.
PROJECT TEAM FORMATION
Perform two activities:
Determine who needs to be on the team.
What roles will each person perform?
Picking the right team members can be a difficult decision, especially if a project involves a large number of departments. In such projects, it could be wise to break them down into smaller pieces and work towards completion of a series of phased projects.
DOCUMENT CUSTOMERS CORE BUSINESS PROCESSES
Every project has customers. A customer is the recipient of the product or service of the process, targeted for improvement. Every customer has one or multiple needs from his or her supplier. For each need provided for, there are requirements for the need.
The requirements are the characteristics of the need that determine whether the customer is happy with the product or service provided.
So, document customer needs and related requirements. A set of business processes is documented. These processes will be executed to meet customer’s requirements and to resolve their Critical to Quality issues.
DEVELOP A PROJECT CHARTER
This is a document that names the project, summarizes the project by explaining the business case in a brief statement, and lists the project scope and goals. A project charter has the following components:
Roles and responsibilities of the project team
DEVELOP THE SIPOC PROCESS MAP
A process is defined as a series of steps and activities that take inputs, add value, and produce an output.
SIPOC is a process map that identifies all the following elements of a project:
The SIPOC process map is essential for identifying:
The way processes occur currently.
How those processes should be modified and improved throughout the remaining phases of DMAIC.
At the conclusion of the design phase, you should know who the customer or enduser is, their resistance issues, and requirements. You should also have a clear understanding of goals and the scope of the project including budget, time constraints, and deadlines.
During the Measure Phase, the overall performance of the Core Business Process is measured. There are two important parts of Measure Phase.
DATA COLLECTION PLAN AND DATA COLLECTION
A data collection plan is prepared to collect the required data. This plan includes what type of data needs to be collected, what are the sources of data, etc.
The reason to collect data is to identify areas where current processes need to be improved. You collect data from three primary sources: input, process, and output.
The input source is where the process is generated.
Process data refers to tests of efficiency: the time requirements, cost, value, defects or errors, and labor spent on the process.
Output is a measurement of efficiency.
At this stage, the collected data is evaluated and sigma is calculated. It gives an approximate number of defects.
A Six Sigma defect is defined as anything outside of customer specifications.
A Six Sigma opportunity is the total quantity of chances for a defect.
First we calculate Defects Per Million Opportunities (DPMO), and based on that a Sigma is decided from a predefined table:
As stated above, Number of defects is the total number of defects found, Number of Units is the number of units produced, and number of opportunities means the number of ways to generate defects.
For example, the food ordering delivery project team examines 50 deliveries and finds out the following:
Delivery is not on time (13)
Ordered food is not according to the order (3)
Food is not fresh (0)
So now, DPMO will be as follows:
From the Yield to Sigma Conversion Table, 106,666.7 defects per million opportunities is equivalent to a sigma performance of between 2.7 and 2.8.
This is the method used for measuring results as we proceed through a project.
This beginning point enables us to locate the cause and effect of those processes and to seek defect point so that the procedure can be improved.
Six Sigma aims to define the causes of defects, measure those defects, and analyze them so that they can be reduced. We consider five specific types of analyses that help to promote the goals of the project.
These are source, process, data, resource, and communication analysis. Now we will see them in detail.
This is also called root cause analysis. It attempts to find defects that are derived from the sources of information or work generation. After finding the root cause of the problem, attempts are made to resolve the problem before we expect to eliminate defects from the product.
Three Steps to Root Cause Analysis
The open step: During this phase, the project team brainstorms all the possible explanations for current sigma performance.
The narrow step: During this phase, the project team narrows the list of possible explanations for current sigma performance.
The close step: During this phase, the project team validates the narrowed list of explanations that explain sigma performance.
Analyze the numbers to find out how well or poorly the processes are working, compared to what’s possible and what the competition is doing. Process analysis includes creating a more detailed process map, and analyzing the more detailed map, where the greatest inefficiencies exist.
The source analysis is often difficult to distinguish from process analysis. The process refers to the precise movement of materials, information, or requests from one place to another.
Use of measures and data (those already collected or new data gathered in the analyze phase) to discern patterns, tendencies or other factors about the problem that either suggest or prove/disprove possible cause of the problem. The data itself may have defect.
There may be a case when products or deliverables do not provide all the needed information. Hence data is analyzed to find out defects and attempts are made to resolve the problem before we expect to eliminate defects from the product.
We also need to ensure that employees are properly trained in all departments that affect the process. If training is inadequate, you want to identify that as a cause of defects. Other resources include raw materials needed to manufacture, process, and deliver the goods.
For example, if the Accounting Department is not paying vendor bills on time and, consequently, the vendor holds up a shipment of shipping supplies, it becomes a resource problem.
One problem common to most processes high in defects is poor communication. The classic interaction between a customer and a retail store is worth studying because many of the common communication problems are apparent in this case.
The same types of problems occur with internal customers as well, even though we may not recognize the sequence of events as a customer service problem. The exercise of looking at issues from both points of view is instructive.
A vendor wants payment according to agreed-upon terms, but the Accounting Department wants to make its batch processing uniform and efficient. Between these types of groups, such disconnects demonstrate the importance of communication analysis.
Analysis can take several forms. Some Six Sigma programs tend to use a lot of diagrams and worksheets, and others prefer discussion and list making. There are many tools that can be used to perform analysis like Box Plot, Cause and Effect Diagram, Progressive Analysis, Ranking, Pareto Analysis, Prioritization Matrix, Value Analysis, etc.
The proper procedure is the one that works best for your team, provided that the end result is successful.
If the project team does a thorough job in the root causation phase of analysis, the Improve Phase of DMAIC can be quick, easy, and satisfying work. The objective of Improve Phase is to identify improvement breakthroughs, identify high gain alternatives, select preferred approach, design the future state, determine the new Sigma level, perform cost/benefit analysis, design dashboards/scorecards, and create a preliminary implementation plan.
Identify Improvement Breakthroughs:
Apply idea-generating tools and techniques to identify potential solutions that eliminate root causes.
Identify/Select High Gain Alternatives:
Develop criteria to evaluate candidate improvement solutions.
Think systematically and holistically.
Prioritize and evaluate the candidate solutions against the solution evaluation criteria.
Conduct a feasibility assessment for the highest value solutions.
Develop preliminary solution timelines and cost-benefit analysis to aid in recommendation presentation and future implementation planning.
Improvement can involve a simple fix once we discover the causes of defects. However, in some cases, we may need to employ additional tools as well.
Experiments with solution alternatives
Planning for future change
The last phase of DMAIC is control, which is the phase where we ensure that the processes continues to work well, produce desired output results, and maintain quality levels. You will be concerned with four specific aspects of control, which are as follows.
The ultimate purpose in control is the overall assurance that a high standard of quality is met. Customer’s expectations depend on this, so control is inherently associated with quality.
Since the purpose of Six Sigma is to improve the overall process by reducing defects, quality control is the essential method for keeping the whole process on track; for enabling us to spot trouble and fix it; and for judging how effectively the project was executed and implemented.
Quality is at the heart of Six Sigma philosophy. Reducing defects has everything to do with striving for perfection. Whether we reach perfection or not, the effort defines our attitude toward quality itself.
Standardization enables processes to go as smoothly as possible. In a manufacturing environment, the value of standardization has been proven over and over. We need to devise a control feature to processes so that the majority of work is managed in a standardized manner.
CONTROL METHODS AND ALTERNATIVES
The development of a new process of any change to an existing process requires the development of procedures to control work flow. When a process cannot be managed in the normal manner, we need to come up with alternatives, short of forcing compliance to the standardized method.
RESPONDING WHEN DEFECTS OCCUR
The final step in a control process is knowing how to respond once a defect is discovered. The weak links in the procedure, where defects are most likely to occur, can and should be monitored carefully so that defects can be spotted and fixed before the process continues.
The response to a defect may be to prevent a discovered flaw from becoming a defect at all. In the best designed systems, defects can be reduced to near zero, so that we may actually believe that Six Sigma can be attained.
The project team determines how to technically control the newly improved process and creates a response plan to ensure the new process, and also maintains the improved sigma performance.