The truth is the basis of any effort to improve processes and eliminate defects. Six Sigma depends upon the truth to succeed. 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.
Six Sigma process improvement strategies use two applications of statistics. These are descriptive and inferential statistics. Descriptive statistics describe the basic characteristics of a data set. It uses the data’s mean, median, mode, and standard deviation to create a picture of the behavior of the data.
Inferential statistics uses descriptive statistics to infer qualities on a population, based on a sample from that population. This involves making predictions. Examples of this are voter exit poling, sporting odds, and predicting customer behavior.
Statistics are an important part of Six Sigma process improvement. Even so, statistical calculations do not solve problems. Business acumen and non-statistical tools are partners with statistical calculations in establishing root causes and in developing solutions. As important as some sources tend to make statistical tools, Six Sigma improvement projects rarely fail because of math problems. Instead, they fail due to a lack of honesty, management support, or a lack of business acumen. The best screwdriver in the world will still make a poor pry bar.
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.
McIntyre harnesses 15 years of experience in process improvement to produce this specialized book designed to help members of an office analyze and improve their performance and articulate their processes to senior management.
This book explains, in detail, the aspects of the Six Sigma process-improvement methodology. McIntyre focuses on the five phases of this methodology, including defining the problem process at hand, gathering data that accurately represents the process in question, analyzing that data to determine any defects, improving the process based on that data and making sure that gains from changing the process are maintained. He approaches each phase independently, giving a detailed overview of what someone looking to improve a process might do as they progress through all of them. The end product of the journey should be an improved process that helps customers get the results they’re looking for and, therefore, helps business grow. McIntyre intends for this book to be useful to “ground floor” workers—those in cubicles and offices actually living out the processes in question. However, the book alone will not be enough to explain his methods to those who do not already have a background in business or process management. While the author’s content is adequate, helping people at this level understand and implement it might be a problem, particularly when they are specialists in other fields. McIntyre tries to define his terms and make his specialized material as accessible as possible….. the information presented here could help a lot of companies solve problems and grow.
Has much to offer those trying to improve their business, if specialized knowledge and terminology are already in place.
The use of Six Sigma is not just a factory or corporate strategy. Six Sigma can be taught at the cubicle and office level also. Remember that Six Sigma is not a program or just a tool box. It is instead a shift in the way we view ourselves and our work.
There are differences, of course, in how you teach Six Sigma to an individual as opposed to a group. That is my speciality. Maybe it isn’t really Six Sigma, as I hae been told, but it works. That is more important than a name.
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 roll out of a process improvement initiative like Six Sigma is always a cultural event. It requires a cultural change. The problem is that many executives do not have a clear understanding of how to change a culture in this way. Not because they do not have leadership skills, but because it requires leadership without the use of position power. It is sales related.
Six Sigma process improvement initiatives that are inflected on an organization inevitably fail. An organization must be led through the cultural change. If the individuals on the front line (sales, operations, repair, janitors, etc) don’t buy in, the culture will not change. To them it will become the “Program of the Week.” Unfortunately, many consulting firms do not focus on this important aspect of Six Sigma cultural change. It is senior management that writes the checks and as a result it is senior management that becomes the focus.
Do yourself a favor. Do not focus on a prescribed number of Six Sigma Black Belts and Green Belts. Do not focus on the number of full time Six Sigma employees. Neither of these criteria are determinant of success. They are the sales leverage of the consultant that is more concerned with their fees, or they are not knowledgeable enough to be handing your Six Sigma roll out. Instead, try a single department roll out. Let their success create excitement with others in the organization. Cultural change starts with the “grass roots” of the organization. If you agree with this statement, than this will become your area of focus in Six Sigma. Senior Management buy in is essential, but different from the buy in of the rest of the organization.
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.
Six Sigma defines the two aspects of customer satisfaction that affect every business. These are customer satisfaction with the process output and customer satisfaction with the service surrounding it. In the service industry, businesses understand that providing quality service is a key to customer satisfaction. At the same time, though, they must have concern about the service product. For example, consider receiving exceptional customer service from an associate at a retail outlet, only to find the selection of merchandise unacceptable. The result is that you chose a different retail outlet on your next shopping trip. Conversely, what happens when you receive very bad customer service at a different retail outlet, which happens to have a very wide selection of merchandise? Even though you can find what you need, you will probably decide not to do business with them in the future.
Many product manufacturers miss this connection as well. An edge in technology or functionality gives a competitive advantage in the market place. Although this physical advantage is important, if the quality of service provided to the customer is poor, it will likely negate the advantage. For example, you would probably not rush to purchase a technically superior automobile from a supplier known for poor service after the sale.
To summarize, in order to improve customer satisfaction in a meaningful way, the business needs to distinguish between the process that provides the service and the process that provides the product. Without this distinction, it is easy to blame defects on the wrong process, or to fail to recognize that the other process exists. Specifically, the service industry must recognize that their customers see a product component associated with the service they receive and the manufacturing industry must recognize that their customers see a service component associated with the product they receive.
Six Sigma process improvement teams must take all of this into consideration. The application of the Six Sigma tool set by itself will not accomplish this. The Six Sigma team must get out of the box and view the process from the customer’s perspective.
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.