| This article is one of a five-part series on the | | | | - do we have have measurements in place to monitor |
| fundamentals of Six Sigma, taken from our Six Sigma | | | | performance in these areas? |
| training resources website. Six Sigma is a process | | | | - if we do not have a performance measure in place |
| improvement methodology that uses five phases, | | | | for a critical-to-customer area, how can we establish a |
| known has DMAIC: Define, Measure, Analyze, Improve, | | | | metric, and what team will own the upkeep and |
| Control. The DMAIC approach can be applied to any | | | | publishing of the metric? |
| situation where a process, be it physical (i.e. | | | | Take another look at the first bullet point above. |
| manufacturing) or transactional, is producing | | | | Remember that Six Sigma is about reducing costly |
| measurable results. Examples of measurable results | | | | variation. While Six Sigma can be adapted to most any |
| can include anything from manufacturing process | | | | problem, it fits best in situations where undesirable |
| capability to higher level business metrics like customer | | | | variation creating waste or dissatisfied customers. |
| satisfaction. | | | | There will be some areas where Six Sigma is not the |
| The D in DMAIC is about selecting high-payback | | | | answer. For example, a traditional Six Sigma project is |
| projects and identifying the underlying metric(s) that will | | | | probably not the best approach for improving a |
| measure project success. | | | | new-product innovation process - benchmarking |
| Leadership participation is critical to success | | | | against best-practices might be a much better |
| Six Sigma projects create incremental work, and | | | | approach to this problem. Remember, it's all about |
| leadership teams must be convinced that the payback | | | | improving business results, and tools like Six Sigma are |
| will be worth the effort. Without senior leadership | | | | a means to that end. |
| oversight and support, project leaders will typically be | | | | The Define stage deliverable - a clearly defined |
| overwhelmed with resistance from the organization, | | | | project, "Scoped for success" |
| and will make little progress. This situation can be | | | | With management leading the Define brainstorming |
| prevented if senior leaders oversee the Define | | | | sessions, project teams will have picked up |
| process and schedule project reviews at regular | | | | high-payback opportunity areas. Prior to completing the |
| intervals. We recommend quarterly sessions to review | | | | Define stage, the project team must take time to |
| opportunity areas and define new projects. | | | | understand the opportunity area it's been assigned, |
| The Pareto Principle is alive and well | | | | along with the supporting metrics that will reflect |
| The Pareto Principle states that 20% of all potential | | | | process performance (in some cases, these metrics |
| projects will produce 80% of the potential benefits to | | | | must be developed as part of the project). |
| the business. Of course these are not exact numbers, | | | | It's important that the project scope is sufficiently |
| but we have yet to see a business where this | | | | focused for success, and a first-pass pareto analysis |
| concept does not apply. The important take-away is | | | | is often required to select a specific opportunity area. |
| this: Focus your resources. It's better to have five | | | | Here is an example of general opportunity area that is |
| projects in the 20% high-impact category than thirty | | | | translated into a specific project goal - |
| projects spread across the payback spectrum. | | | | "Warranty claims are costing the business $100M per |
| Connecting with the customer | | | | year. Packaging damage represents 10% of all |
| Project teams will tend to focus on the opportunities | | | | warranty claims, and equates to a 2,600 PPM claim |
| they are familiar with on a day-to-day basis. Many of | | | | rate. This project will identify and correct the underlying |
| the projects in the 20% high-payback group will relate | | | | causes of packaging damage, reducing warranty |
| to customer satisfaction, and a cross-functional group | | | | claims in this area from 2,600 PPM to 1,600 PPM. " |
| of senior leaders will be keenly aware of the | | | | This Six Sigma team has done the up-front work to |
| improvement opportunities in this area. As an agenda | | | | develop a clear project definition, and can now get to |
| item on the quarterly Define sessions, we recommend | | | | work with a clearly stated mission in front of them. |
| that senior leaders from all functions (remember to | | | | Adding structure with team charters It's helpful to |
| include the sales and customer support team leaders) | | | | develop a standard one-page team charter template |
| step back and list the biggest improvement | | | | that the project team presents to senior leadership as |
| opportunities in front of the business. Questions can | | | | a final step in the Define stage. This is typically and |
| include - | | | | Excel or PowerPoint document that helps the team |
| - where is inconsistent performance creating | | | | think through the necessary steps to develop a clear |
| dissatisfied customers? | | | | team mission. |