Six Sigma Process Improvement

Posted on December 29, 2009 by Walter McIntyre

Process improvement is the act of increasing the value of a process’s output in the eyes of its customers.

Putting this into a business perspective, we can view a business as a collection of processes that focus upon providing an output that its customer’s are willing to pay for. Therefore, the objective of a business process is to add value to a collection of inputs, from a customer perspective, to produce a profit to the business. Consider the following, simplified, value equation.

Profit = Perceived Value – Inherent Value

Perceived value is customer and competitor driven. From the customer standpoint, this involves their perception of cost, function, ease of use, absence of defects, customer service, etc. The customer’s view of your competition, in these same categories, provides the competitor influence.

Inherent value comes from the cost of raw materials, infrastructure, and process. This adds up to the actual cost of production of a product, or the actual cost of provision of a service. Businesses wish to increase the perceived value of their products and services. While at the same time, they wish to decrease their inherent costs. The result is increased customer satisfaction and higher profits. Process improvement becomes the vehicle to accomplish both.

Six Sigma Projects

Posted on November 12, 2009 by Walter McIntyre

Below are some examples of potential projects. Some are good process improvement project ideas and some are not.

1. The installation of a new process or piece equipment that has already been selected.

Answer: This is not a good project idea. The decision about what to do has already been made.

2. Call center cycle time improvement.

Answer: This is a good project idea. It involves the improvement of an existing process. It may need further scope narrowing (Type of phone calls, for example).

3. Development of a new ad campaign.

Answer: This is not a good project idea. The scope is too broad and does not address improving an existing process. Even so, some of the tools that make up common process improvement methodologies can be used in the development of the new ad campaign.

4. Improve safety.

Answer: This can be a good project idea. The scope is too broad and needs to be narrowed. If the scope were narrowed to something more specific, it would become a good project (reduce back injuries in the warehouse, for example).

5. Reduce the number of back injuries while unloading trucks.

Answer: This is a good project idea. The project is narrowed down to a specific situation involving back injuries.

6. Increase profits

Answer: Not a good project idea. The scope is too broad.

The Six Sigma DMAIC Process

Posted on October 29, 2009 by Walter McIntyre

The Six Sigma process improvement methodology has 5 steps. Corporately, they are called the DMAIC (da*may*ic) process. The steps, also called phases, are Define, Measure, Analyze, Improve, and Control. A process improvement team moves through these phases by meeting specific objectives (Tollgates or milestones). In reality, the team’s progress through the methodology is cyclic in nature. A Six Sigma project may need to go through one or more of the steps repeatedly in an effort to get to the root cause of a problem and eliminate it.

In addition, as the Six Sigma team moves through the steps, they identify other defect causing issues for future teams. A single improvement project may identify multiple opportunities outside of the team’s project scope. The rigor of a good process improvement effort mandates that the team stay on course and simply flag these issues along the way, rather than bouncing from one problem to another. Other teams can address these new opportunities. The net result is a business that has less waste, lower cost, higher customer satisfaction, increased market share, and as a result, increased profits.

Voice of the Customer

Posted on October 22, 2009 by Walter McIntyre

Beyond the analysis of processes, a successful improvement initiative becomes a business philosophy that changes it’s culture and value system. By listening to the voice of the customer, a business can find exactly what the customer wants and design the products and services that meet their expectations. Expectations are not limited to quality. Customers also have expectations of functionality, appearance, safety, etc. You have to listen carefully to your customers to know what they are looking for. When these expectations are known, the business can partner with their customers, creating a closed loop in the relationship. A business accomplishes this by aligning its values and strategies with the expectations of its customers.

Six Sigma Success and Honesty

Posted on October 20, 2009 by Walter McIntyre

Not all business problems lend themselves to the Six Sigma process improvement methodologies, especially those that have short time lines. There are many problems that business leadership understand and should just fix. A Six Sigma improvement project typically requires one to six months for a team to complete, depending upon the complexity and scope of the problem. This is longer than acceptable for some problems. In addition, many of the tools used in Six Sigma do not apply well to problems that are not process based. Examples of these would be emergencies and relationship issues. Process improvement tools apply better to up-front planning for these situations, than to the situations themselves.

Two other important considerations are the impact of variation and the truth. Not all variation is bad. Without variation, there would be no improvement. Six Sigma projects use variation to find both problems and solutions. This is because the awareness of a better way to do something manifests itself as variation. Consider, for example, that there are two processes producing an identical output. The operator of one process makes a change and introduces variation between the two processes. This new process produces fewer defects than the former process. Thus, by way of introducing variation, the operator discovers a better way to produce the output. Conversely, by eliminating all variation, we eliminate all experimentation, and as a result, we eliminate process improvement. The key is to plan and control variation. By planning and experimenting, a process owner can discover new and better ways to produce the product or service.

The truth is the basis of any effort to improve processes and eliminate defects. Sacred cows, sub-optimization, and parochialism are enemies of the truth and place limits upon how much improvement is achievable. To optimize improvement, we must embrace the truth, even if it hurts. The truth will literally set us free.

What is a Successful Six Sigma Process improvement Initiative

Posted on October 18, 2009 by Walter McIntyre

A successful Six Sigma process improvement initiative is not a program or a set of tools. It is a cultural shift. In other words, Six Sigma changes the way a business manages itself. This is a shift away from decisions based solely upon “tribal knowledge” (gut feeling, we have always done it this way, etc.), to decisions based on data and business acumen. When the data is customer focused, improvement projects align corporate strategies with customer expectations in a way that produces a positive financial impact. It is important to understand that data, “tribal knowledge”, and business acumen are all required for high quality decision making.

Walter McIntyre Lean Six Sigma