Six Sigma Blog

Small Business, Big Gains

By Priya Jestin, Staff Writer

If you are one of those who thought that Six Sigma was only for large corporations, you’re not alone. Many people believe that Six Sigma process improvement results can only be achieved by huge organizations. What they don’t realize is that small businesses too can succeed in implementing Six Sigma and reap the process improvement benefits of this approach.

Agreed, the implementation and results may vary depending on the size of your organization. For instance a small business doesn’t have access to a large pool or resources like a big business firm. At the same time, the very nature of its business – small in size – will ensure that the process flows are flexible, and the decision-making chain is shorter.

Another thing a small business cannot do is, undertake massive training programs for its employees. They also cannot afford to have full-time Master Black Belts on staff and may not have the personnel with the skills and expertise to step into the role of Black Belts without extensive training. In such a scenario, you can get a certified Six Sigma consultant to act as your Black Belt for the initial projects. Once you have generated enough savings, you can use some of this amount to train your own people. Financially, savings realized from the first set of projects usually justifies the entire cost of the Six Sigma training.

What Is Six Sigma?

One cannot continue to write about how to achieve perfection without understand the notion of perfection. The same theory applies for the Six Sigma method. Six Sigma at many organizations simply means a measure of quality that strives for near perfection. So what exactly is Six Sigma? It can be called a disciplined, data-driven approach and methodology for eliminating defects in any process. This means a firm using the Six Sigma approach, methodically tries to correct all defects from the manufacturing to the transactional process and from product to service.

If we go as per the definition, to achieve Six Sigma, a process must not produce more than 3.4 defects per million opportunities. A Six Sigma defect is defined as anything outside of customer specifications. A Six Sigma opportunity is then the total quantity of chances for a defect. Process sigma can easily be calculated using a Six Sigma calculator. Isixsigma.com reports:

The fundamental objective of the Six Sigma methodology is the implementation of a measurement-based strategy that focuses on process improvement and variation reduction through the application of Six Sigma improvement projects. This is accomplished through the use of two Six Sigma sub-methodologies: DMAIC and DMADV.

Read more: Six Sigma - What is Six Sigma?

Six Sigma and the Delivery Boys

-- By Pushpa Sathish, Staff Writer

Delivery boys (or men) lecturing to business graduates at India’s premier management institution – believe it or not, it’s fact not fiction.

It’s an amazing success story, one that even Forbes Global picked up a few years ago. The term Six Sigma does not come to mind when one thinks of lunch boxes and their delivery – but one delivery service in India has managed to garner a Six Sigma rating on par with Motorola. The Mumbai Dabbawallahs, or members of the Nutan Mumbai Tiffin Box Suppliers’ Association, have earned fame with their “perhaps one mistake every two months” out of the 170,000 lunch boxes they deliver everyday across offices in Mumbai. With a complicated, yet simple, coding system for each box, the delivery men get hot, home-cooked food to office-goers at lunch time, and deliver the boxes back to their homes before they get there themselves after the day’s work.

The president and secretary of the dabbawallahs’ association will talk to the students of the Indian Institute of Management, Kozhikode, about the efficiency of their supply chain, at the school’s annual operations seminar, “Opus,” on the topic “India Inc. – From Sustenance to Operational Excellence.”

How Six Sigma Affects You

Six Sigma affects your organization in the following ways:

• Recognize the benefits of being part of a Six Sigma implementation
• Match the Six Sigma roles to the business activities of employees involved in Six Sigma
• Sequence the DMAIC team life cycle
• Identify the steps in the DMAIC problem-solving model
• Identify examples of the challenges that are faced by the employees when Six Sigma is implemented within an organization
• Associate the capabilities for successful Six Sigma participation
• Apply Six Sigma capabilities to participate in the Six Sigma initiative of an organization.

Read my previous post titled "Applying Lean Manufacturing to Six Sigma" to know about lean manufacturing.

Instantis Publishes Six Sigma Maturity Model

Instantis, the leading provider of on-demand software for managing top-down performance improvement initiatives like Six Sigma. We all know that Six Sigma methodology is being adopted by thousands of global enterprises to measure and improve a company's operational performance through rigorous use of data and statistical analysis.

Dr. Prasad Raje, Instantis CEO and founder, developed the model and authored the white paper that defines the commonly experienced stages of Six Sigma maturity. The model is said to have tremendous practical value for organizations that want to benchmark their progress against industry norms, assess implementation strengths and performance gaps.

My previous post titled "Identifying Six Sigma Steps" will give you information on Six Sigma steps.

Global Lean/Six Sigma Training from Omnex and AIAG

Omnex Inc. and the Automotive Industry Action Group (AIAG) have announced the formation of a global training and consulting partnership between the two companies to offer Lean/Six Sigma training in Asia. According to the deal, Omnex will deliver AIAG-accredited training programs in China, India and Thailand.

Omnex began its Asia operations in 1995 with Thailand as its Asia Pacific headquarters. Now it has six fully functional offices in the Asia region. Both companies share a common vision to provide consistent state-of-the-art quality education and training that supports the emerging needs in the corporate sector.

Read my previous post titled “Why Six Sigma Has Become the Most Powerful Improvement Tool?” to know more about Six Sigma methodology.

Mercury Marine reaches magical 1000th project with Six Sigma

It all began in 2003 for Mercury Marine as far as its Six Sigma process improvement implementation is concerned. Over the next three years, Six Sigma has touched thousands of Mercury employees around the globe, helping them build better business processes. So much so, that the JD Power surveys put Mercury at the top of the list of companies that are driven by customer satisfaction. BYM News reports:

...nearly 700 management and production employees have been formally trained in Lean Six Sigma methods, with dozens more attending training every quarter. The company has also worked with its suppliers and customers to create a lean supply chain to ensure the highest quality products are manufactured and available for consumers.

Steps for Implementing Six Sigma

There are several steps for the implementation of Six Sigma in an organization. These steps include:

• Understanding the commitment of top leadership
• Access to current information on customer requirements
• A process management system to measure current performance and identify where you need to make improvements
• Employing Black Belts and Green Belts to design and improve processes and to assist process owners
• Allowing management involvement and review to reinforce process management, improvement and design
• Adopting effective communication strategy to ensure that Six Sigma methods are implemented throughout the organization.

Read my previous post titled "Applying Lean Manufacturing to Six Sigma" to know more on Six Sigma and Lean Manufacturing.

DMAIC and DMADV in Six Sigma

DMAIC in Six Sigma is used to improve a process. DMAIC is the acronym for the following:

• Define the project, process and voice of the customer
• Measure the current process performance
• Analyze to determine and verify the root cause of the focused problem
• Improve by implementing counter-measures that address the root causes
• Control to maintain the gains.

DMADV is used to design a process, product or services. DMADV is the acronym for the following:

• Define the project
• Measure and determine customer needs
• Analyze the design options to select one that best meets customer needs
• Design the detailed processes
• Verify the design performance
• This systematic design methodology can build processes that will reliably meet customer expectations.

Read my previous post titled "The Robust Nature of Six Sigma" to know more about the characteristics of Six Sigma.

Six Sigma in Hospital & Healthcare Management

Six Sigma methodologies can change the face of modern hospitals and healthcare delivery systems. Privatization and competition in healthcare sector are forcing healthcare organizations to look for new ways and means for improving their processes. They look for improving quality of the hospital's products and services, thus reducing patient dissatisfaction. It has been noticed that healthcare sector has become more complex. Hence, the scope for error is more.

To reduce the errors and to move towards perfection, most of the corporate hospitals are now functioning at Three Sigma or Four Sigma quality levels. There is a desperate need to break the traditional boundaries that separate physicians, hospital administrators, pharmacists, technicians and nurses by shifting away from the traditional culture. Six Sigma methodologies can help achieve this objective and can change the face of modern hospital and healthcare delivery system. Our old post titled "Why Six Sigma Has Become the Most Powerful Improvement Tool?" will give you more information on Six Sigma.

Spot Weld Software Enables Six Sigma Initiatives

TechMatrix has released its WeldWorks Software Suite designed to work with their RSX Series automated weld platform or with stand-alone weld controllers. The software suite enables manufacturers to achieve Six Sigma quality initiatives and control their resistance spot weld process by monitoring every weld's key process parameters. It also helps in tracking the information against individual parts. The software architecture is built on the leading Microsoft.NET technologies. It consists of four modules that provide a complete end-to-end solution.

Does Your Company Have a Sustainable Six Sigma Implementation?

In the past five years, several companies in India have started implementing Six Sigma as a business philosophy. The successful implementation experience of many companies in the Western world makes a compelling case for all organizations to implement Six Sigma. Here the question is whether these companies have a sustainable implementation or is just going to fad away after some time.

Sustainable Six Sigma implementation largely depends on individual leadership. The leader brought in personal conviction, support and the needed resources. However, the leaders may not stick to any particular company for a long time. Hence, the first challenge is to make Six Sigma deployment less dependent on a few individuals.

Lack of management conviction may result in implementation failure for your organization. You must spend time and energy to understand the dynamics of Six Sigma. This will enable you to zero-in on the critical issues of integrating Six Sigma into the applications of your organization.

Why Six Sigma Has Become the Most Powerful Improvement Tool?

Today's corporate world is witnessing stiff competition among the organizations that intend to outwit each other in terms of growth and development. Companies now focus on the following points that have become part of their organizational strategy:

• Global competition
• Accelerating pace of change
• Adoption of new technologies
• Meeting customer satisfaction
• Reducing costs
• Delivering quality

It is not easy for the companies to meet the above challenges. To meet such demands, Six Sigma methodology has become the most important corporate initiative. Experts believe that there are only a few companies that have not taken any initiative on Six Sigma implementation. Now the companies focus on retaining old customers rather than wooing new customers. Six Sigma plays an important role in meeting the standards of customer satisfaction and thus, retaining the customers who bring benefits to the company.

Are you Ready For Six Sigma?

This question is aimed at business enterprises that have not implemented Six Sigma methodology in their organizations, but planning to do so. Six Sigma has been touted as a powerful quality improvement method that boosts employee job satisfaction and increases profits. Although many shops strive to improve operations and profits have adopted lean production and other quality improvement methods, only few enterprises have implemented Six Sigma techniques. There is a presumption that only large companies can implement Six Sigma in their organizations. This is true to some extent.

Implementing Six Sigma requires a considerable financial investment. In addition, dedication of resources and employee training are part of Six Sigma implementation. The benefits of Six Sigma allure companies of small and medium size. However, they do not have the time or the financial resources to invest in the long-term benefits of Six Sigma.

If your company is planning to implement Six Sigma, you will need to make an analysis on cost factor. The short-term costs for training and the length of time to complete projects can heavily affect small companies. It is true that Six Sigma will bring greater benefits to your company. However, you must prepare to handle the situation aftermath Six Sigma implementation.

Six Sigma - No Longer Limited to Manufacturing Sector

Six Sigma concepts have traveled a long way. The decade-old manufacturing theory has been replaced by business-process strategies. The global economy forced organizations to focus on areas that have been neglected for long. Customer satisfaction and process improvement have become the most focused areas. To achieve faster and accurate result in those areas, companies have deployed Six Sigma methodology. Not surprisingly, the result is overwhelming.

Six Sigma is a highly disciplined, project-based methodologythat can help companies focus on developing and delivering near-perfect products and services. Six Sigma concepts are proactive tactics based on customer-service and ensure zero defects in the organizational functioning.

Six Sigma indicates how a process has deviated from perfection and fix the problems accordingly. Now Six Sigma methods have become essential for the organizations that wish to improve their business and catch up with their rivals. We are in a business world that heavily relies on quality rather than quantity. That increases the importance of Six Sigma.

Six Sigma: The buzzword in the U.S. armed forces to reinvent "business" processes

First, it was the 96th Regional Readiness Command in Utah (see earlier post); now, it is the U.S. armed forces in Korea. Lean Six Sigma continues to touch the administration in the U.S. army. The very fact that the Six Sigma principle is being pursued across boundaries confirms the success of the initiative.

Not only is Six Sigma enabling the army to cut costs, but it is enabling the army to reinvent and re-engineer processes within the army that remove wasteful steps and increase productivity.

As part of its business transformation efforts, the U.S. armed forces in Korea will graduate its first batch of Lean Six Sigma black belts on July 28. The graduates will be much better equipped to improve business practices within the army, particularly in the important functional areas such as reset, repair, manufacturing, and administration.

The following half year will see the army push through several more black belt and green belt training courses to imbibe process improvements. Army Public Affairs quotes  Secretary of the Army Dr. Francis J. Harvey:

Lean Six Sigma empowers people and helps them see the possibilities. People learn that they can document processes that haven't been documented, quantify work activities that haven't been quantified, and measure results that haven't been measured.

Implementation of Six Sigma

Globalization has increased the competition worldwide. Competitive pressure is forcing the organizations to search for the means to improve their processes. They want to ensure the quality of their products and services in order to meet the objectives of customer satisfaction. The methodology of Six Sigma aims at integrating all operations throughout the processes to make them produce their desired results.

Implementation of Six Sigma covers various processes related to manufacturing and services including distribution operations, warehouse and inventory management, health care and manufacturing. Any organizations will benefit from Six Sigma initiative regardless of the products or services offered by them. Making Six Sigma part of the business strategy will definitely help the organizations to register sustainable growth.

Six Sigma in Business Process Management

Six Sigma is a long-term initiative designed to change the way in which businesses operate. It helps companies to increase profits, streamline operations, improve quality and eliminate defects in the work processes. Six Sigma also focuses on achieving financial targets in a short period. Six Sigma is frequently implemented in a traditional departmental paradigm without much reliance on business process thinking.

Many Six Sigma practitioners complain of the difficulty in identifying the best opportunities to apply Six Sigma techniques. Integrating Six Sigma with business management principles will help the organizations realize significant opportunities against the traditional methods of implementing a Six Sigma program. Since process ownership relies on managing by influence as opposed to authority, process owners would collaboratively sponsor projects. The progress of the project would be monitored by a team of executives, thus preventing the collapse of the project.

Six Sigma - A Powerful Improvement Methodology

Today's business world has identified the key areas to focus on. Emphasis on some key points gives the companies a clear edge over their rivals. These key points are:

• Global competition
• Accelerating pace of change
• New technologies
• Increasing demand for customer satisfaction and quality
• Cost saving

In order to meet the above demands, Six Sigma methodologyhas become the most important corporate initiative. Most companies either have implemented the Six Sigma methodology in their organization or are planning to do so. Six Sigma is the best methodology to understand sources of variation and reduce defects. It also increases productivity and shareholder value. Six Sigma delivers products, processes and services that satisfy a customer.

Lean Six Sigma in the US Army

In a dramatic development, the Army is contemplating to use Lean Six Sigma to build a better and faster force. Dozens of war-ravaged vehicles arrive from Iraq every week to get repaired. These vehicles are repaired at the Red River facility in Texarkana, Texas. It is one of the Army's oldest and most important maintenance and storage bases. The multi-purpose vehicles repaired there are also known as humvees. The Army is planning to choose a best model that would help the facility to streamline the process and ensure effective results. Lean Six Sigma is seen an ambitious project of the Army to meet its objectives. The Lean Six Sigma process will also help the Army to implement a systematic management process.

According to Time -

The two concepts of Lean and Six Sigma have been around the private sector for decades, and some parts of the Army have been using them since 2002. Lean is an outgrowth of the Toyota production system, developed in the 1930s, which focuses on increasing efficiency and reducing cycle time by eliminating waste.

Technology Solutions Company Develops New Six Sigma Solution

Technology Solutions Company (TSC) has announced the development of a new and fully integrated Enabling Driver for Growth & Efficiency (EDGE) package solution for SAP. The solution is designed to help companies increase their operational and manufacturing performance. TSC is a leading consulting firm. EDGE goes beyond Six Sigma and Lean to enable adaptive and continuous business process improvements in key business processes. EDGE package solution focuses on improving the quality and productivity of the enterprises. EDGE enables companies to focus on those processes that create value for their customers, which ultimately drives profitable growth.

According to Yahoo -

EDGE is designed for ease of implementation with a fixed time and fee approach that delivers quick time to value, enabling IM&C companies to better meet market demands and provide competitive advantage without straining budgets and introducing risk to their business.

Six Sigma in Small Businesses

Small business owners will eventually sense the need for Six Sigma implementation in businesses. Any company that is on the threshold of expanding the operations to meet the growing customer expectations focuses on its resources on generating more sales. Small companies with 50 - 100 employees and revenue of $10-15 million may find themselves in trouble. They require consultants who can enhance the capabilities of their organizations. The cost of hiring consultants is not affordable for all companies. Hence, they explore the options such as hiring a Black Belt and having their employees trained in-house for Green Belt positions.

An experienced Black Belt provides greater benefits through own knowledge and experience. Black Belts have proven track record and have the best chances of outweighing the initial cost benefit of grooming in-house Black Belts. For the effective implementation of Six Sigma processes, Black Belts are often required. Green Belts can assist them in accomplishing their job even though they do not have high skill. An experienced Black Belt can take minor shortcomings of Green Belts in stride and things will eventually balance out.

The Robust Nature of Six Sigma

Six Sigma's strength lies in its structured ability. When it is rationally executed, it brings forth the inherent shortcomings in any process. The implementation methodology allows comparison of prevailing procedure against the most appropriate one aimed at reducing error-producing subroutines. Removing errors from the preparation stage will have a positive impact on subsequent processes. Six Sigma also leaves scope for customer value analysis and operational excellence methods. These methods are usually driven by a thorough understanding of customer values.

Now the organizations have realized that there is a need to look beyond Six Sigma. Six Sigma brings the objectives of companies to a winning stage. It is sustained for the future when a quality approach is adopted as a culture by the entire organization. Operational excellence is focused on execution of programs. It uses powerful analytical and measuring tools and prepares the ground for returning to the customers' requirements. Looking beyond Six Sigma requires a long-term vision. The vision puts the customer on top. It emphasizes on customer profitability and customer share. The next stage of Six Sigma clearly focuses on customers rather than organizations.

Fundamentals of Six Sigma

Six Sigma Management is a quality improvement system, which was originally developed by Motorola in the mid-1980s. Six Sigma offers a prescriptive and systematic approach to quality improvement. It places a great deal of emphasis on accountability and bottom-line results. Many companies use Six Sigma management to improve efficiency and eliminate defects. It also helps in reducing costs.

Six Sigma comes from the managerial approach designed to create processes that result in no more than 3.4 defects per million. One of the important characteristics of Six Sigma is a clear focus on achieving bottom-line results in a relatively short period. Initially, only a few companies adopted Six Sigma in their organizations. However, after seeing the success at these companies, other companies worldwide have instituted Six Sigma management programs.

Six Sigma in Small Businesses

Small businesses eventually senses the need for Six Sigma implementation in their businesses. Six Sigma tools have been considered useful for larger organizations for a long time. That perception has changed significantly over the years. A small company planning to expand it operations to meet growing customer expectations will find Six Sigma implementation beneficial in order to optimize its resources on generating more sales than ever.

There is a need for proper assessment to find out how many resources can be afforded and whether Six Sigma is really needed for that particular organization. The cost of hiring consultants is not easily affordable. Companies have to explore options like hiring a Black Belt to train their employees in-house for Green Belt positions. Hiring a Black Belt may be expensive. But the benefits they will provide to the companies will be greater than that cost. An experienced Black Belt helps companies focus immediately on a pressing issue that is critically important for the respective organizations.

Six Sigma Methodologies and Business Process Management

The Business Process Management Suite (BPMS) is an ideal platform for implementing Six Sigma projects by Dr. Setrag Khoshafian. Khoshafian has focused on Six Sigma and BPMS as complementary techniques. The chapter discussed the evolution of the BPMS from human-centric workflow to comprehensive business process management suite. BPMs have evolved significantly in the recent years. The main characteristics of the Business Process Management suite include business rules, integration, reporting and activity monitoring.

More Information: Read Here

One of BPM's early pioneers, Khoshafian is the author of several books on computing and business process management.

Six Sigma Deployments

According to a recent survey, companies that have been using Six Sigma for seven or more years are more likely to focus projects on improving IT processes. They would integrate IT methods with Six Sigma and align IT projects with business priorities. However, it may not be the case with the companies that have been using Six Sigma for less than three years. Most respondents believe that Six Sigma is very useful to improve IT processes.

More Information: Read Here

Similarly, companies that viewed IT as a key strategic component accounted for 86% of the respondents who "always" used Six Sigma to improve IT processes. Conversely, companies that viewed IT as merely another "staff role" accounted for 72% of the respondents who "never" used Six Sigma to improve IT processes.

Six Sigma extracts maximum from Australia's natural resources

It is one thing to have potentially high natural resources, and another to reap its benefits. In the absence of a systematized plan to translate the resources into benefits, nature's bounty can only rest as a wasteful abundance.

Fortunately for Australia, the Six Sigma philosophy and quality management technique is quite popular in the mining sector, and this is able to bring out the best results from the country's resources of bauxite, iron ore, lead, zinc, silver, uranium, industrial diamonds and mineral sands. Six Sigma statistical analysis helps manage, improve, and reinvent business processes, thus adding to the national coffers. In turn, Six Sigma implementation is aided by MINITAB, a package that analyzes statistical data to minimize defects in the business processes or in the product itself.

MINITAB offers a range of tools for graphical analyses, collecting powerful statistics, quality analyses with potential for a range of individually designed uses.  As Ferret.com.au reports, MINITAB and Six Sigma run hand in hand to minimize errors and maximize returns.

Experienced practitioners apply Six Sigma to IT processes: Study

The May/June issue of iSixSigma Magazine has published a survey on the extent to which Six Sigma practitioners apply Six Sigma principles in their business processes. The study shows that companies that have practiced Six Sigma for seven or more years are more inclined to apply Six Sigma to IT processes.

These mature companies are quick to integrate IT methods with Six Sigma and include IT projects in their priority list. On the other side of the picture, companies that do not see IT as a vital cog in their business wheel are less favorable to use Six Sigma to improve their IT processes. Marketwire quotes Michael Marx, Research Manager for iSixSigma Magazine:

Only 17 percent of the more than 950 respondents said that their companies always or usually use Six Sigma to improve IT processes.... And when other projects led to IT-based solutions, they were rarely implemented—either because of the perceived cost or because of a lack of priority placed on IT.

All About the Six Sigma Process

Six Sigma is a measurement of quality that strives for near perfection. It is a disciplined, data-driven approach and methodology for eliminating defects in any process. The statistical representation of Six Sigma describes how a process performs. To achieve Six Sigma, a process must not produce more than 3.4 defects per million opportunities. A Six Sigma opportunity is the total quantity of chances for a defect. Process sigma can easily be calculated using a Six Sigma Calculator.

The fundamental objective of the Six Sigma methodology is the implementation of a measurement-based strategy that focuses on process improvement and variation reduction through the application of Six Sigma improvement projects. There are two Six Sigma methodologies: DMAIC and DMADV. The Six Sigma DMAIC process is an improvement system for existing processes falling below specifications. The Six Sigma DMADV process is an improvement system used to develop new processes or products at Six Sigma quality levels. Both Six Sigma processes are executed by Six Sigma Green Belts and Six Sigma Black Belts.

Six Sigma for Marketing Process

Every business focuses on sustainable growth and needs competitive environmental changes for it. However, getting the desired result is not that much easy. Marketing is one of the key characteristics of a business process and it is very important to strengthen the marketing operations.

The Six Sigma discipline gives business leaders the opportunity to drive more fact-based decisions into managing the business. Six Sigma has been successful in integrating itself into the technical aspects of a business. Engineering and manufacturing are two areas where Six Sigma methodology has done a fair job. A new effort is being made to bring Six Sigma into the softer side of business marketing.

The Six Sigma concept has evolved over the past several decades to represent a set of fundamental business concepts. These concepts put customers first and use fact-based decision-making to drive improvements. Experts believe that a unique view of Six Sigma's techniques and tools can be applied to drive income growth. Companies have now started to implement Six Sigma into sales and marketing.

Huntsman Opts for GETPAID

Huntsman Corporation has selected SunGard's AvantGard GETPAID Order-to-Cash solution to support its Six Sigma initiative. Huntsman, a manufacturer of commodity chemicals, will integrate GETPAID with its SAP systems to improve cash flow and cut operating costs. BusinessWire reports:

We selected AvantGard GETPAID to help us manage corporate growth while minimizing our operational costs," said Gord Zivanovic, corporate Six Sigma at Huntsman. "AvantGard GETPAID will also help us to improve invoicing transparency and control, and provide analysis for ongoing process improvements."

Six Sigma helps reduce motor vehicle accidents

Motor vehicle accidents are an increasing occurrence in today's fast-paced world. In an innovative measure, Dow's Hydrocarbons and Energy business unit (HC&E) has extended the application of the well-established industry practice of the Six Sigma methodology of MAIC (Measure, Analyze, Improve and Control) to develop a practical program for reducing such accidents.

After the initial study in 2002, a control plan was deployed in January 2003. Post-implementation observation of data reveals that there is a 30 percent reduction in motor vehicle accidents witnessed by HC&E over the period 2003-2004. While the accident data for the years 2001 and 2002 showed 23 accidents each year (46 for both the years), only 32 accidents were witnessed for 2003 and 2004 put together (15 for 2003 and 17 for 2004). CCH reports:

Following this success, many of the training materials developed by the project team, such as a Vehicle Pre-Startup Checklist, have been adopted for use at other Dow businesses. OSHA reported this case study but noted that the views do not necessarily represent the official position or policy of the US Department of Labor.

Solving The 5 S Puzzle

Let’s start our foray into the techniques of lean manufacturing this week with an ice-breaker on 5 S. The method is a hand-me-down from the Japanese who are renowned for their dedication to quality. So what do the 5 Ss denote?

Seiri (Tidiness) or Sort – emphasizes the importance of eliminating all those items and process that are not absolutely necessary for the process at hand. In other words, don’t be a pack rat and hoard stuff.

Seiton (Orderliness) or Set – stresses on the adage “a place for everything and everything in its place”. It’s a simple way of facilitating easy retrieval and thus eliminating wastage of time and effort in the search process.

Seiso (Cleanliness) or Shine – reiterates the proverb that “cleanliness is next to godliness”. Everyone in the organization should contribute to the creation of a clean workplace, with responsibility being assigned for each area.

Seiketsu (Standardization) or Standardize – defines standards and methods for maintaining cleanliness – both personal and of the workplace. It includes practices such as color-coding for easy identification, storage and retrieval of objects.

Shitsuke (Discipline) or Sustain – urges you to continuously practice the five Ss as a way of life rather than as a one-off thing. It means assuming responsibility for oneself and one’s activities without performing only when someone is watching over you. In short, it is the elimination of bad habits and the continuous adoption of good ones.

Choose Wisely…

Now that we have seen three methods of improving manufacturing processes by the reduction of waste, how do you decide when to use what?

Kaizen is best used when solutions demand simple answers that can be arrived at through common sense.

Lean manufacturing techniques are best applied to soft process areas like new product developments, distribution and logistics management, supply chain management, accounting and finance management, and customer service management.

Six Sigma comes into the picture for those opportunities with the most impact that result in the elimination of poor quality costs. Six Sigma focuses on the key operations of an organization and often results in annual cost reductions between 2 and 7 percent.

The Power of Kaizen

Kaizen – the word has different connotations in Japanese and Chinese, but the end results are the same. The Japanese pronounce it as kai (change) and zen (good) while the Chinese say Gai Shan (the action to correct). Either way, kaizen means to influence a change for the better. Kaizen’s goals include:

• Elimination of waste by removing activities that add cost but no value
• Just in Time delivery methods to enahnce inventory management
• Standardizing work processes and activities
• Appropriate equipment of the right size
• Paced moving lines
• Production load leveling of amount and types

Kaizen, if applied correctly, makes hard work extinct, teaches you to improve using scientific processes, and humanizes the workplace. The three important musts for kaizen are:

• Systematic thinking
• A broad view of processes and results, and not just results
• Non-judgmental attitude where no blame is placed

which are implemented with the application of the five founding elements of kaizen:

• Teamwork
• Personal discipline
• Improved morale
• Quality circles
• Suggestions for improvement

Kaizen is a continuous cycle of the following processes:

• Standardization of operations
• Measurement of cycle time and in-process inventory of the standardized operation
• Comparison of measured values and required values
• Innovation to meet requirements and improve productivity
• Standardization of the new, improved operations

Unraveling Six Sigma

They are all methods that help reduce redundancy and waste in business processes. Six Sigma, Lean manufacturing, and Kaizen are all proven techniques that help save on cost and generate fast returns on investment. Starting with Six Sigma, let’s take a brief tour around the principles and techniques that each method uses, and the benefits that accrue from their implementation.

Six Sigma principles and techniques include:

• Reduction in variation
• Regression analysis
• Variance analysis (ANOVA)
• Design/Measure, Analyze, Improve, Control (MAIC)
• Focus on the project
• Measurement system assessment
• Statistical process control
• Stability of processes
• Response Surface Methodology (RSM)
• Evolutionary Operation (EVOP)
• Design of experiments
• Taguchi Methods
• Yellow, green, black, and master black belts
• Root cause analysis and tests of hypothesis
• Failure Modes and Effects Analysis (FMEA)

Watch this space for a detailed explanation of each of these principles. In the meantime though, let’s take a look at the benefits that arise from practicing Six Sigma methods:

• Fifty percent decrease in costs
• Reduction in the waste chain
• Better grasp of the needs of customers
• Improvement in delivery and quality performance
• Provision of critical process inputs to keep up with varying customer demands
• Development of robust products and processes
• Improvements with available internal resources

Make the Right Choice

Now that we have seen the similarities and differences between the two Six Sigma Methodologies DMAIC and DMADV, would you be able to identify which situations each should be used in?

• DMAIC will reap you rich rewards if used when an existent product or service is not meeting customer satisfaction levels or organization performance levels.
• DMADV is more valuable when used if you need to decide on the introduction of a new product, or if the product exists and has been subject to the DMAIC or any other methodology, but still does not meet customer specifications or Six Sigma standards.

Different Quality Control Approaches

In my earlier post, I had listed the common traits of Six Sigma Methodologies DMAIC and DMADV. Now let’s look at the differences between both.

• DMAIC measures processes to determine current performance while DMADV measures and determines customer needs, expectations and specifications.
• DMAIC analyzes and determines the root cause of the defects or problems while DMADV analyzes the process options that will satisfy customer requirements.
• DMAIC improves performance by removing the defects while DMDAV designs and outlines the process that will help in meeting customer needs.
• DMAIC attempts to control future performance while DMADV checks to see if the designed process has the ability to meet customer needs.

DMAIC and DMADV __ Common Threads

Most organizations have a problem when it comes to deciding which Six Sigma methodology to use to solve certain problems. The two methodologies __ DMAIC (Define, Measure, Analyze, Improve, Control) and DMADV (Define, Measure, Analyze, Design, Verify) are similar in some ways and varied in others. In this post, we will explore the points common to both.

• They both aim to reduce defects and variations to less than 3.4 per million opportunities.
• They use objective thinking methods that are data intensive and based on factual information to solve problems.
• They are both implemented by Green Belts, Black Belts, and Master Black Belts.
• They are both methods used to help organizations reach their financial and business targets.
• They are carried out with the support of a sponsor and a process owner.
• They both define project goals and internal and external customer deliverables.

AIT Group extends capabilities as a member of Decisioneering’s Six Sigma Partner Program

If you are looking for a methodology to improve your business process, you can take advantage of the services of Advanced Integrated Technologies Group Inc. (AIT Group). AIT Group provides four important services that contribute toward process improvement: Design for Six Sigma, Six Sigma, Lean Production, and Business Process Management (BPM) frameworks for supply chain, design chain and customer chain.

The company has now joined Decisioneering’s Six Sigma Partner Program to take advantage of the Crystal Ball software in its process-improvement implementations. Crystal Ball has already enabled individuals and organizations to make decisions that are more informed. Quality Magazine reports:

In 2002, Decisioneering launched its Six Sigma Partner Program, a co-marketing effort that provides consultants who practice Six Sigma, Lean Six Sigma and Design for Six Sigma (DFSS) with materials and assistance for their Crystal Ball training and implementation.

Six Sigma in the design of new products and services

In the 1980s, Six Sigma started out as a process that could improve quality and save costs. After the success story of Motorola, leading companies like GE and Honeywell adopted Six Sigma principles to good effect. In the 1990s, the Six Sigma was practiced in non-manufacturing applications, such as software development and financial services. The focus now was to use Six Sigma in designing a new product by taking customer CTQs into consideration from the beginning of the process.

In line with this trend, Six Sigma is now being implemented in programs such as Design for Six Sigma (DFSS), Voice of the Customer (VoC), and new methods to compile customer intelligence including market research, focus groups, and ethnographic research. Usability Views reports:

Originally intended for manufacturing processes improvement, Six Sigma concepts have now been adapted to design new products and services.

Six Sigma in Design

The acronym DFSS (Design for Six Sigma) is used for the implemenation of Six Sigma in the design of products and their manufacturing processes. DFSS concentrates on research, design, and development. DFSS is similar to DMAIC (Design, Measure, Analyze, Improve, Control), and the implementation of DFSS is sometimes known by the abbreviation DMADV (Define, Measure, Analyze, Design, Verify). Daily India reports:

The precise phases or steps of a DFSS methodology are not universally defined. Most organizations will implement DFSS to suit their business, industry, and culture.

Six Sigma in pharmaceutical companies

In an effort to counter the challenges of marketability, competition, and time constraints, pharmaceutical companies are now turning to the tenets of Six Sigma. However, to be successful in real terms, organizations must embrace Six Sigma principles and practices in every link of the management chain. Pharma Live reports:

The tools of Six Sigma, Lean, and other continuous improvement methods work to streamline processes and eliminate defects in those processes. In conjunction with those ideals, executives and managers work to find areas throughout the company where continuous improvement can have an impact.

Six Sigma should start from the top

With an increasing awareness of the importance of the Six Sigma approach in business enterprises, it is imperative that the practice of Six Sigma percolates through every rung of the business, beginning with the leadership.

Considering this, a new website has been unveiled, dedicated to making business leaders well-versed with the Six Sigma approach. However, it is upto the senior management to actually put Six Sigma into practice, so that defects in the business processes are minimized and the overall management becomes more productive. As is well established, Six Sigma finds expression in the DMAIC process (define, measure, analyze, improve, control), which is inducted into a business by Six Sigma experts—the Six Sigma Master Black Belts. OpenPR reports:

“Enhanced performance does not and will not happen automatically. High-caliber training is required. Hard work and discipline has to be used, and people at all levels have to change the way they go about doing their jobs.” Says Spisak. In short, new ways of thinking, communicating, and operating must pervade the entire organization. You also need a methodology. Naturally, companies that have joined a Six Sigma approach for their improvement process are looking to do more than diversify skills. With this , they initiate a company-wide culture shift geared toward breakthrough change and the pursuit of perfection. This approach is geared towards a more comprehensive deployment that will yield breakthrough improvements and bottom line profitability.

Six Sigma: methodology and benefits

Six Sigma has effectively improved the process revolving around the two vital cogs in a business process -- managing costs and meeting the needs of the customer. By using data and and statistical analysis, Six Sigma leads to an improvement in the overall enterprise environment by reducing defects.

The framework adopted by Six Sigma involves the DMAIC (define - measure - analyse - improve - control) methodology. All business process should revolve around this framework in order to improve quality.

"Define" refers to specifying the customer requirements. It is also important to identify the processes that lead towards the goal of the enterprise. The next step is to "Measure" or gather information on the defects in the targeted processes, and locate problem areas. This data is then "Analyzed" to project the difference between the desired levels and the actual process. Next, the process is "Improved" by implementing solutions to the problem areas. Once the process is improved, "Control" steps are undertaken to maintain the quality over time. Domain-B.com reports:

The biggest companies across the world have implemented Six Sigma, like Motorola, GE, 3M, Citicorp, Ford, Apple, Microsoft and many others. Their experience has been very encouraging; most say they have derived significant benefits: A reduced number of defects has resulted in huge savings on the costs that companies incur in rectifying defects and compensating customers. This saving adds directly to the bottom-line of the company.

Six Sigma helps systematize supply chain

In establishing a deal for raw materials across cross-country borders, it is important to follow up the finalization of the customer with efficient proccesses that ensure the effective execution of the deal through all the supply-chain stages.

With the implementation of manufacturing processes and techniques such as Six Sigma, it has now become possible to determine the precise location of the raw material. The manufacturre reports:

With the continued push toward efficient manufacturing processes such as lean and six sigma, it’s not enough to know that critical parts are on the way or have been shipped. You need to know where they are in the supply chain, whether they’ve cleared customs, whether they’re sitting in a warehouse or if they’re on the last leg in a journey to your loading dock or your customer.

Six Sigma DMAIC approach can improve marketing results

Six Sigma has been generallyapplied to improve the process, quality, and productivity of a business enterprise. However, the Six Sigma tools, such as the DMAIC approach (define, measure, analyze, improve, control), can be applied equally effectively to improve the marketing output.

For example, you can define the problem areas and then decide on your team, objectives, resources, and timeline. Then you can measure the process to arrive at the existing performance level, and establish a baseline on what is required to improve the performance. The next step is to analyze and identify the main causes of the problem, and follow up with corrective steps to improve the process. Finally, you need to control the process and performance in the future. The Herald Business Journal reports:

Another important Six Sigma success factor involves appointing a champion to oversee the process and conduct “tollgate reviews” at each DMAIC milestone to ensure the project stays on track. This will facilitate better reporting and real-time tweaks as necessary. Use Six Sigma as a philosophical and data-driven approach toward improving your marketing process. A Six Sigma mind-set will generate greater customer value—and that usually translates into better results.

Research: Six Sigma increases efficiency, but might retard innovation

According to Wharton management professor Mary J. Benner, process management systems such as TQM and Six Sigma contribute to improving the efficiency of business enterprises, but it is important to have the suitable setting for these concepts to be applied. Otherwise, they can hinder innovation. Corante reports:

"In the appropriate setting, process management activities can help companies improve efficiency, but the risk is that you misapply these programs, in particular in areas where people are supposed to be innovative," notes Benner. "Brand new technologies to produce products that don't exist are difficult to measure. This kind of innovation may be crowded out when you focus too much on processes you can measure."

Software provider Akmin implements Six Sigma

In order to further its goals of continued development and to maintain high quality standards, software vendor Akmin has implemented the DMAIC approach, a Six Sigma methodology. Akmin's major offering is SiteGalore, a private branded online website building software for ISPs, web hosts, domain registrars, ASPs, and other service providers.

By implementing DMAIC, Akmin hopes to get maximum leverage for customers through a data-driven approach. This approch is expected to result in identifying important performance indicators, managing processes, measuring problems, improving quality, and reducing costs. Web Hosting Info reports:

Prashanth, CEO of Akmin says, "Given the fact that we are the first ever company in our line of business to launch an enterprise-wide Six-Sigma framework, we are certain that this initiative will delight our customers, who are looking to maximize their competitive advantage by offering a site building service that is truly unmatched in its quality."

Integrating Six Sigma and Lean

Practitioners of Six Sigma and Lean, or of one or the other, have often wandered how to integrate the two concepts in a single business enterprise. According to a news article published by I-Newswire, it is important to first understand the definitions of both Six Sigma and Lean, and then think of a practical methodology to put both of them into practice.

The definitions of the two concepts are many and varied, and for the present purpose it would be a good approach to adopt the "purest" definitions. Regarding Lean, the first thing that needs to be understood is that it is a way of thinking about business conduct, and not a tool in itself. In the Lean way of thinking, the customer is at the focus of all activity, and the value attached to a service or product by the customer is all-important. On identifying such value of a set of services or products, a good practice would be to eliminate the "non-value" elements, so that the customer reaps the maximum benefit. In the process, Lean practices promote cost cuts and a step-up in quality deliverance.

Six Sigma, on the other hand, is an analytical tool that purges the system of it inconsistencies in delivering services or products of value. Practitioners of Six Sigma need an effective plan in place, which helps them remove inconsistencies and variations in the production system.

From this understanding, it is clear that both Lean and Six Sigma can contribute together to adding value to a service or product, and by economizing the use of money, time, and energy. For example, the primary Lean tool called Enterprise Value Stream Mapping can help implement a plan of action, and Six Sigma exponents can work on the basis of this plan to further the goals of the business process.

According to Lean Advisors Inc., EnterpriseValueStreamMapping™ provides a complete map of the enterprise and allows a business enterprise to design a more effective future state implementation plan. The value stream map encourages an organization to make total system transformations as against point improvements.

Software Wizard to automate consistent data process in Six Sigma projects

Six Sigma project depend on the proper maintenance of data in the control phase. Normally, this process of harnessing consistent data is a manual process with additional costs, and there are also chances that the process will get out of control and lead to dissatisfied customers.

Such production problems might now be a thing of the past, with the new software wizard inRealTime introduced by Hertzler Systems, an affiliate of statistical software MINITAB. Hertzler has an impressive list of customers including Boeing Aerospace, BAE Systems, IDEX Corporation, Kraft Foods, McCormick & Company, Inc., Pactiv Corporation, and Titleist & Footjoy Worldwide. inRealTime can be plugged into MINITAB so that Six Sigma projects are able to come up with consistent process data in real time.

The MINITAB product range is the most widely used for the improvement of Six Sigma projects. The versions that are currently available are MINITAB Release 14, MINITAB Japanese Release 14, MINITAB Korean Release 14, and MINITAB French Release 13. The software includes features such as basic and advanced statistics; regression and ANOVA; time series; new and improved presentation-quality graphics; simulations and distributions; flexible data import, export, and manipulation; statistical process control; design of experiments; reliability analysis; multivariate analysis; and sample size and power calculations.

Using inRealTime, a company implementing Six Sigma processes can automate business processes such as keyboard/gage data entry, updating of charts in MINITAB, and economizing the production time.

Perot Systems and Six Sigma Advantage to deliver Six Sigma for software and IT services

Perot Systems, a global provider of IT services, and Six Sigma Advantage Inc. have finalized an agreement to extend a set of effective tools and methods to the Department of Defense. These tools will enable the department to implement improvements in the internal processes. PR Newswire reports:

Six Sigma is a highly structured, rigorous, and disciplined methodology that utilizes data and statistical analysis to measure and improve an organization's operational performance, practices, and systems. It is a disciplined process that focuses on developing and delivering near-perfect products and services, including information technology.

National In-Store strengthens Six Sigma program

National In-Store (NIS), a leading retail resources provider in the US and subsidy of Omnicom Group Inc., is the first company in its genre to implement Six Sigma in its management process. NIS has now strengthened its Six Sigma program by adding 42 Yellow Belts, and is progressing well towards being a pioneer in training associate companies to cut costs, improve efficiency, and enhance customer service through Six Sigma implementation.

Through the practice of Six Sigma, NIS manages to provide an assurance to its client base that the company is striving to improve management processes that will ultimately auger well for the customers themselves. PR Newswire reports:

"NIS is a pioneer when it comes to incorporating Six Sigma into retail services," explains CEO and founder Tom Dowdy. "Our major retailer and consumer product company clients expect us to manage their accounts efficiently and provide quick results. Our philosophy is centered around working better, faster and smarter for our customers," Dowdy adds.

Six Sigma DMAIC Roadmap helps implement OSHA

More often than not, organizations do not analyze situations and take a generic decision in implementing a process. For example, the requirement of OSHA is that employees who are exposed to an average of 8 hours to noise levels above 85dB must be enlisted in a hearing conservation program, but companies often subject all their employees to a hearing conservation program without analyzing the individual conditions of the employees.

The Six Sigma DMAIC (Define, Measure, Analyze, Improve and Control) roadmap can be applied to arrive at a more accurate evaluation of the situation. Thus, a team was constituted to analyze the working conditions at W.R. Grace & Co., a specialty chemical manufacturing company based in Columbia, Md.  Before the arrival of the team, the company had enlisted all employees to the hearing conservation program. However, the team applied the DMAIC roadmap in evaluating the work conditions of individual employees, and then segregated the employees according to the noise level they were exposed to. Finally, using Six Sigma methodology, the team concluded that only three of the 11 operators were potentially exposed to an 8-hour TWA of greater than 85 dB. Occupational Hazards reports:

The use of the Six Sigma method is applicable to other areas of environmental, health and safety. The roadmap provides the data required to make the best decisions. The control phase requires work to be assigned and completed. The tools used also provide the documentation and means to follow the success of the improvements.

Survey of Six Sigma professionals ties higher investments with successful programs

iSixSigma has published a research survey which indicates that investments in  Six Sigma program are directly proportional to the returns for a company. An investment upwards of $2 million is likely to improve returns by 200-500 percent, while a comparatively low investment amount of $500,000 is likely to lead to a break-even situation at best.

The survey also concludes that executive backing is important for the success of an organization. Out of the respondents who declared a succcessful program implementation, 87 percent confirmed that they had a committed executive strength.

A third indicator from the survey was the relative advantage of an enterprise-wide deployment of Six Sigma programs. Market Wire reports:

Only 42 percent of respondents said their companies started with a full deployment. But those programs were three times more likely to report an eight-fold ROI in the first two years. The conclusion from all these results is obvious. "You get what you pay for," said Marx. "A higher level of investment results in a higher return on investment."

Six Sigma implementation in small and medium-sized business processes

Questions have often been raised about the effective implementation of Six Sigma in small and medium-sized organizations. However, an article published on isixsigma.com explains that small companies can implement Six Sigma with certain changes in methodology, provided the owner of the company is committed to Six Sigma and there is a willingness to change the working process.

The company must display the patience to withstand variation and must ensure that its customers are not affected adversely by the changes in the working process. The company must also have the capacity to create "slack" and redundancy. To begin with, in its growing phase, the company must retain two or three Green Belts; later, when the size of the company is large enough, it can have one Black Belt, who can work with the Green Belts. Other challenges that the company must face up to are ensuring expertise and coping with the dynamics associated with small businesses. isixsigma.com reports:

Most Six Sigma projects take four to six months, which is often too long in a small business environment. However, long cycle times often are the result of big company bureaucracy. They are not a built-in limitation of Six Sigma. Choose projects carefully, sponsor them effectively and pursue them aggressively. A small business will find that it can successfully complete most projects in four to six weeks, instead of months.   

Procurement process of GlaxoSmithKline includes Six Sigma implementation

GlaxoSmithKline's Janan Johnson, director of procurement for corporate services, was nominated by Business Travel News as the 2005 International Travel Manager of the Year at the Association of Corporate Travel Executives conference in London last week. The approach adopted by GlaxoSmithKline for its procurement process includes Six Sigma methodology.

According to Susan Lancaster, director of procurement at BTI, Johnson has avoided using Six Sigma principles in isolation, as is so often the case. Johnson approaches procurement by applying Six Sigma on both the operations and services sectors. BTI is also implementing Six Sigma to its relationship with another global airline. BTNOnline.com reports:

GSK's hard-core procurement approach also incorporates Six Sigma processes. While Lancaster said other customers use Six Sigma, "they tend to do it in what I call isolation. Janan has used procurement processes all the way through the program, using the procurement tool and applying Six Sigma not only operationally, but also on the service side.

Business Process Management: A methodology to implement Six Sigma

According to business process management (BPM) analyst Connie Moore of Forrester Research, BPM is perceived by process owners as a way to implement improvement initiatives including Six Sigma. BPM is a computer program that aids processes across different functions and applies to both people and systems.

The users of BPM see it as a process that is managing their work. However, the process affects several parts of an organization. Its basic functionality centers around efficiency and productivity, cutting down on time and cost. The starting point of a BPM implementation is important. Intelligent Enterprise Magazine reports:

To begin, look for projects that affect the company's revenue, are high cost or are associated with customer satisfaction. Processes that transcend company boundaries, involve extensive integration or constantly change involve much higher risk. Start with the highest-reward, lowest-risk process and then expand as you move up the learning curve.

“Customer needs are at the very heart of Six Sigma”

The Financial Times has published a feedback submitted by Jon Walden, Managing Director of Lex Vehicle Leasing on the article by Simon London published by FT on October 26 regarding the advantages and disadvantages of process analysis. According to Walden, London’s article emphasized the challenging issues involved in an implementation of the Six Sigma techniques of business reorganization on knowledge workers.

Pointing out that London displays a reluctance to accept process analysis on his working week, Walden adds that it would be a useful exercise to gain feedback and suggestions from the "customers", i.e., the readers of the article. FT.com quotes Jon Walden:

Customer needs are at the very heart of Six Sigma, and account for its success. Increasingly, service businesses are going to need these techniques if they are to gain a lead over competitors in a world where service will be progressively more commoditised by the internet and the outsourcing of work to lower-cost countries.

SixNet Business Intelligence System: Leading provider of Six Sigma Management

SixNet Business Intelligence System, which provides support for performance improvement initiatives, has a long list of valuable clients including BHP Billiton, Entergy Corporation, Freddie Mac, Mellon Financial, and Royal Dutch Shell. The latest addition to this list is Peabody Energy, which has signed an agreement with SixNet to provide an impetus to its performance building measures.

SixNet has been successful because it gives its clients an easily deployable technological solution that is both cost-effective and can be customized according to client requirements. The company has more than 15,000 on-demand users. PRNewswire reports:

SixNet combines ease of use with powerful performance, enabling its customers to align efforts and resources to corporate objectives; increase financial savings; reduce cycle-times for project completion; and provide real-time reporting.