In an ideal world, companies would be able to run their business with no waste and no customer attrition. Without these bumps in the road, companies could significantly increase their profits. Alas, the world is not ideal. But that doesn’t mean weighty waste reduction and improved customer retention isn’t a possibility. Enter the Six Sigma process.
Measurement is the first step that leads to control and eventually to improvement. If you can’t measure something, you can’t understand it. If you can’t understand it, you can’t control it. And if you can’t control it, you can’t improve it.H. James Harrington
In fact, in 1986, Motorola was so confident that they could make these changes to their production and customer satisfaction that they designed an initiative to reduce their product defects down to 3.4 defects per million products. This initiative was so successful that Motorola expanded it to their other business processes and they branded it as their Six Sigma process.
What Is The Six Sigma Process?
In simplest terms, the Six Sigma process is a quality control program. When it was developed, its purpose was to reduce manufacturing defects and improve cycle time. Over the past few decades, the program was adapted to address a wider range of general business needs, such as sustaining and improving business products and services, improving customer retention, and better meeting customer requirements.
In more advanced terms, the goal of a Six Sigma process is to make statistical improvements to business processes. It reduces focus on qualitative markers, in preference of qualitative measurements of success–think project management, financial analysis, and statistics. Success is seen as efficiency, which is recognized as a business process that has less than 3.4 defects or problems, anything that does not satisfy the consumer, per one million chances. At its core, a Six Sigma process advocates the idea that all business processes can be optimized through measurement.
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How Does The Six Sigma Process Work?
A Six Sigma Process is a five-step process that goes by the acronym DMAIC. The ‘D’ stands for define. This first step is where a team of people, who are often led by a Six Sigma certified professional, define the fault. This is where their focus will be and it is landed on by analyzing the organization’s requirements and goals. During the define step, the team outlines the specific problem or fault, their goals, and the project deliverables.
The ‘M’ stands for “measure.” During this step, the team takes a look at the current process and measures its initial performance. These measurements come from the list of inputs that are potentially causing the problem. They also enable the team to get a clear picture of the benchmark performance of the process.
The ‘A’ stands for “analyze.” The team isolates every input that could be causing the defect. They then test each input to see if it’s the root of the problem and analyze the results. The team then identifies the problem input.
The ‘I’ stands for “improve.” After identifying the problem input, the team makes a plan for improving the system performance and puts this plan into action.
Finally, the ‘C’ stands for “controls.” The team creates controls and integrates them into the process. This ensures that the defect doesn’t become an issue again.
How Does The Six Sigma Process Benefit Organizations?
Employee and Customer Satisfaction
The benefits of a Six Sigma process go beyond increased profits and increased customer satisfaction. It helps to develop a more stable and strong organization as a whole. One of the most surprising benefits of this method is increased employee satisfaction. This is mainly because Six Sigma processes can be applied to employee queries. Whether queries are about company regulations, terms of contracts or pay entitlements, they frustrate and confuse both employees and HR, as well as wasting time. When the Six Sigma process is applied to this area of business, errors are removed, time is saved, and morale is boosted. Employees have a clear understanding of how much overtime they qualify for, how much vacation time they can have, and exactly how payroll works.
A second potential benefit of a Six Sigma process is increased productivity. Utilizing your staff to their full potential is a major challenge. It can be difficult to pinpoint the root cause of low productivity, especially when you need to measure the time that is spent on both indirect and direct work activities. You might need to hire more staff. Or it could be that they just need more training. Alternatively, the major issue might actually be with your supply chain. Six Sigma’s methodological process can provide clarity on what the real issue is and how you can address it.
A third possible benefit that a Six Sigma process offers is the reduced waste. Resources can be severely drained by any work process that adds no value in the eye of the consumer. And this doesn’t just mean overproduction or wasted materials, costs and time. It also includes waste such as untapped employee skills, ideas, and creativity or the unnecessary movement of products, people and information. A Six Sigma process helps an organization dig down deep into why this waste is occurring, understand how to cut the output of services or manufacturing of products that aren’t being immediately utilized, and implement controls that slim down unnecessary processes.
Improved market share
The fourth benefit of a Six Sigma process often offers businesses is the possibility of an improved market share. For every Sigma process shift, organizations that have implemented a Six Sigma process will often see about 20% profit margin growth annually. Most companies sit around 3 Sigma or 66,807 defects per million opportunities. Even just one Sigma shift, to 4 Sigma, represents a serious amount returned to the organization’s bottom line–down to 6,210 defects per million opportunities. These type of improvements mean companies can invest that saved money into the creation of new services, products, features, and functions, which will, in turn, result in an even larger share of the market.
How Can Organizations Make Their Six Sigma Process Controls Stick?
While the Six Sigma process can look like magic. It’s not. It’s hard work. After an organization has finally isolated the causes of defects, they then have to figure out how to avoid those causes–and stick to it. One of the biggest reasons organizations fail to make a Sigma shift is that their controls aren’t adhered to. But this doesn’t have to be the case. Controls aren’t difficult to keep in place if they are implemented and tracked carefully.
One of the most effective ways to keep controls in place is through the use of outside guidance, such as Tallyfy’s SaaS app for workflow. This app is ideal for a process that needs to be repeated over and over again. It moves controls over from flimsy spreadsheets or paper to interactive software, which ensures that they are done on time, consistently and accurately. Tallyfy also allows for the process or control to be tracked and audited, whether it’s a human-intensive process, internal support process, or customer-facing process. This means that not only can you improve the process, but you’ll be able to easily meet all compliance requirements as well.
The true beauty of Tallyfy’s workflow application is that it was built with the Six Sigma process in mind. If an organization doesn’t have the time to complete process mapping and improvement, Tallyfy has outsourcing services available to their Six Sigma partners and consultants. This way companies can be sure that they have a clearly defined and communicated ‘who’, ‘what’, ‘when’, ‘how’ and ‘why in their process mapping. In addition, the process maps are easy to follow, track, measure and improve. No more hoping that the final stage of your Six Sigma approach sticks. Once you have it mapped out, you have all the accountability and clarity that everyone involved needs.