Outsourcing Firms Embrace Six Sigma to Keep Costs Down
As an increasing number of US firms begin to embrace the philosophy that peripheral business interests can be outsourced in an effective and cost cutting fashion, Indian outsourcing firms are standing by to pick up the pieces. With the increased demand in India for labor capable of supplying increasingly compex services for western communities, it is no surprise that labor costs are increasing rapidly. This is undermining some of the cost effectiveness that drove western companies to places like India in the first place. So to maintain their edge, a large number of outsourcing firms are beginning to implement efficiency programs such as Six Sigma. The Six Sigma program offers outsourcing companies the opportuinty to streamline their services while keeping a lid on increasing labor costs. Ultimately, this will allow such companies to move up the value food chain while simultaneously remain attractive options to western companies. Business-Standard reports:
Some 3,350 consultants, in quality assurance areas such as Six Sigma, and hundreds more trained in the capability maturity model (a way to find out the complexity of a task that a company can break down into standard steps), can help streamline even a clients’ own product development processes.
Small Businesses Embrace Six Sigma Efficiency Philosophy
While Six Sigma has historically been the turf of only the largest companies, due to its high setup and initiation costs, a number of small companies are now beginning to implement the strategy. Smaller firms are largely unable to make the financial investment to have employees recieve formal Six Sigma training. As a consequence, such companies are turning to a number of resources available through books and blogs (such as this one) to learn about implementing Six Sigma. This has allowed an increasing number of small businesses to achieve the baseline benefits of implementing Six Sigma which include a review and streamlining of the business model, a cutting of unneccessary overhead, and increases in efficiency by identifying weak points in production. In fact, a number of software developers and online blogging companies are making the transition, achieving what appears to be rather significant gains. Jim Sherman reports:
Incorporating Six Sigma into the small business model in a limited fashion, is an important way to reevaluate a business model and retool the most inefficient aspects of a small business, without making the financial investment necessary to implement Six Sigma in a real formal way.
Applying Six Sigma to Healthcare
While the business world has incorporated Six Sigma in leaps and bounds, the health care community has been reticent to employ the strategy in hospitals and other health services facilities. That trepidation has been due to the fact that many health care managers are either unaware of the Six Sigma program or are not convinced that it can be effectively applied to the health care community.
Six Sigma is designed to eliminate errors. In few arenas is this more important than in healthcare. As demand and expectations for medical care increase, it becomes increasingly important for health care providers to streamline their processes and to become more error-free. Six Sigma is able to achieve very real and documentable bottom line improvements in both financial and preformance indicators. This is primarily due to the fact that while health care is an individualized service, underlying that service is a number of regimented and regulatable smaller tasks. SalesMastersWorld reports:
Analyzing and modifying human performance in these environments is complex, but Six Sigma provides the tools and methodology required to achieve significant long-term improvements.
Conference to Discuss Future of Six Sigma and Lean in Economic Upswing
The Four Seasons Philadelphia will this August 24-26 play host to executives from Fortune 500 companies who are set to discuss how early adapters and innovative leaders are utilizing Six Sigma and similar programs to gain an edge on the competition. Keynote guests include Sun Microsystems, GE and Rexam executives, who have ushered in new takes on the Lean Six Sigma initiatives and in turn seen phenomenal successes with the program. The group will also discuss the shift from strict cost cutting to revenue generation and waste reduction which has corrolated with the economic upswing globally and in the United States specifically. Forbes.com reports:
Discussions include: How GE Maintains Operational Efficiency, Six Sigma at Xerox, Sun Microsystems: Rebooting the Lean Six Sigma Initiative, Lockheed Martin’s Quality and Process Excellence Success.
Free Online Six Sigma Audit Checklist
has produced a free checklist for auditing a Six Sigma integration. The checklist allows for individuals considering implementing a Six Sigma program to get a good idea of what components need to be in place to develop a strong program. In addition, it provides those who already have a Six Sigma program in place, an excellent resource to gauge the effectiveness of their program. The checklist has been developed by Praveen Gupta, the president of Quality Technology Company (QTC), who has over 20 years of experience with the Six Sigma process through his work with Motorola, AT&T and Bell laboratories. IndustryWeekly reports:
Six Sigma and Lean Compared and Ranked
Six Sigma and Lean have emerged as the two leading efficiency and variation control programs for the modern business environment. And yet, those new to these technologies are often at a loss as to which alternative to choose. Based on recent evidence, however, it appears that far more business users are choosing Six Sigma over Lean. A recent report by The Avery Point Group indicates that the book sales of Six Sigma far outpace those concerning Lean, search engine keyword searches for Six Sigma, outpace Lean by a margin greater than 2 to 1, and Internet job postings searching for Six Sigma professionals are over 50% greater than those looking for Lean experts. The Avery Point Group has pointed to the fact that Six Sigma has made the transition from its original use, manufacturing, to encompass many other business disciplines. The same cannot be said to be true for Lean, which is consistently regarded as a purely manufacturing related process. YahooFinance reports:
“This perception is changing as more and more businesses across the board are looking to blend the best of each methodology to accelerate their continuous improvement efforts,” says Noble. “Companies are increasingly realizing that these are truly complementary tool sets and not necessarily competing philosophies.”