Six Sigma is a framework that was designed to eliminate waste and improve the customer experience. It was introduced to our mainstream business culture in the 1980’s when Bill Smith, an engineer for Motorola, first introduced the concept.
The smart guy will outsmart himself. The lucky guy will run out of luck. The money guy will never have the desire. But hard work will take you anywhere you want to go.Bill Smith
Today, according to many business development experts, Six Sigma is the most popular quality improvement methodology in history. It is used worldwide across a diverse range of organizations including nonprofits, prisons, hospitals, banks, and corporations. The article will look more closely at what Six Sigma is, what the benefits are of using it, and how businesses can successfully implement it.
What is Six Sigma?
So what does it mean to be a Six Sigma organization? If you are running a Six Sigma organization, then for every million opportunities there are no more than 3.4 inefficiencies. In other words, it demands results that are close to perfection.
If this sounds extreme or unrealistic to you then consider the alternatives. If a business was operating at a Three Sigma level, this would mean that for every million opportunities there would be 66,807 defects.
Or to put it another way, if a pharmacy operated at a Three Sigma level this would mean that there would be 54,000 incorrect drug prescriptions every year. At a Six Sigma level, that same pharmacy would have three incorrect drug prescriptions each year.
The ultimate goal is to improve the experience for the customer by eliminating variation. Variation is simply deviating from what the customer expects and it can cause your customers to quickly lose faith in your company. Variation tells your customers that you are inconsistent and don’t deliver predictable results.
DMAIC
Six Sigma is usually accomplished by implementing the basic methodology DMAIC. DMAIC stands for define, measurement, analysis, improvement, and control and it has helped many businesses get rid of waste.
- Design: During this phase, your team will clearly outline what the problem is. You will also decide on a goal and evaluate all the tools and resources available to you.
- Measurement: Next your team will look more closely at the process that is already in place and measure its performance. By evaluating how the process is performing you will have a better idea of what improvement is needed.
- Analysis: When your team analyzes the problem, you will try to discover the root cause of that problem.
- Improvement: Once the problem has been identified, your team is ready to brainstorm possible solutions and put a plan in place.
- Control: This is the final step and it involves creating systems to control the process performance. This is important because, without it, you may just end up dealing with the exact same issue in another six months.
Benefits of Implementing Six Sigma
Organizations from nearly every industry have benefitted from Six Sigma, including companies like Motorola, General Electric, and Honeywell. It can benefit the customer, individual employees, and the company as a whole. Listed below are the five biggest advantages many businesses see as a result of implementing Six Sigma:
Increased revenue
When your company improves the quality of its services and products you can see incredible long-term revenue increases. After its first year of using Six Sigma principles, General Electric saw $300 million in increased revenue.
Better quality
By operating a Six Sigma business, companies have to minimize defects and improve quality to the point that few customers will ever experience a problem. And this does not just apply to manufactured products; at Akron’s Children’s Hospital, the quality of their services increased tremendously by implementing Six Sigma. The wait times for MRI scans were cut down by 90 percent and the emergency room minimized the amount of time it took to locate supplies by 63 percent.
Reduced costs
Successful Six Sigma implementation can result in massive savings, which will allow your company to use that money elsewhere. In 2007, the United States Army implemented Six Sigma and saved over $2 billion that year by streamlining task management, cutting costs, and recycling fuel.
Improves the customer experience
When you improve the quality of your products and services and reduce variation, your customers will reap the benefits. And when customers receive a consistently positive experience, they are more likely to become loyal long-term customers.
Increased productivity
Often businesses think they are overstaffed when the real problem in insufficient training. Implementing Six Sigma can give your business clarity on the root cause of low productivity and help you effectively address it.
Belt Levels
When your company decides to implement Six Sigma, you will most likely work closely with a professional who will help you implement these changes. These professionals are given various “belt levels” based on their experience, past contributions, and capabilities. Working with a Six Sigma professional is an important component in achieving the success you are hoping for. Here is a list of the belt levels and what each one means:
- Master Black Belts: Master Black Belts are responsible for strategizing and finding ways to apply Six Sigma principles across business structures. They also will usually provide training to other team members.
- Black Belts: Black Belts will also lead projects for businesses that provide solutions to high-level problems. They are also responsible for providing training for team members.
- Green Belts: Green Belts will collect data and provide analysis.
- Yellow Belts: Yellow Belts usually assist the team with process improvements.
- White Belts: White Belts will usually help with solving problems but they are not necessarily a part of the team.
Implementing Six Sigma
Strategies for implementation can vary quite a bit depending on the organization and the specific business goals. However, once a company has decided to implement Six Sigma there are usually two ways to go about this. They can either implement a case-by-case initiative or create a Six Sigma infrastructure.
A case-by-case initiative involves certain employees being taught specific tools that they can apply to jobs as needed. Other employees can consult with that person if they need help on a certain project. This method can result in success but rarely does this strategy result in major changes to the organization.
By creating a Six Sigma infrastructure, you will use it through projects rather than just individual tools. This is often a more focused and productive way to implement Six Sigma tools. It can also lead to a more detailed understanding of important business processes.
Conclusion
Six Sigma can help your business eliminate waste, reduce variation, and improve the customer experience. It isn’t a fad and it isn’t going away anytime soon; it is a proven business method for improving a company’s operations.
But in spite of its many successes, over 60 percent of Six Sigma projects do not achieve the desired results. There are many reasons why this happens, but more often than not, the reason is not being able to enforce the changes you’ve made to the processes.
Process management software, however, can help with that. Tallyfy helps establish & enforce standardized processes, making sure that your business is running at peak efficiency.
Related Questions
What is Six Sigma in simple terms?
Six Sigma is like a recipe for making things work better. Imagine you’re baking cookies – sometimes they come out perfect, and sometimes they don’t. Six Sigma is a way to make sure your cookies (or any process) come out perfect almost every time by finding and fixing problems. It’s a method that helps companies reduce mistakes and waste while making their customers happier.
What are the 6 points of Six Sigma?
The six key points of Six Sigma are actually known as DMAIC plus one extra step: Define (figure out what needs fixing), Measure (collect data about the problem), Analyze (understand what’s causing issues), Improve (make changes to fix the problems), Control (make sure the fixes stick), and then Repeat the process. Think of it like cleaning your room – you identify the mess, see how messy it is, figure out why it got messy, clean it up, and then create habits to keep it clean.
What does 6 sigma level mean?
A Six Sigma level means being so good at something that you only make 3.4 mistakes out of every million tries. Imagine if you were shooting basketball free throws and only missed 3 or 4 shots out of a million – that’s how precise Six Sigma aims to be. This level of accuracy means that things are working nearly perfectly, which saves money and makes customers very happy.
What is Six Sigma and what is its goal?
Six Sigma is a problem-solving system that aims to make processes nearly perfect. Its main goal is to make customers happy by delivering products or services with almost zero defects. Think of it like a doctor who not only treats symptoms but finds and fixes the root cause of an illness to prevent it from coming back.
How is Six Sigma different from other improvement methods?
Six Sigma stands out because it relies heavily on data and statistics rather than gut feelings or assumptions. It’s like using a GPS instead of guessing directions – you get exact information to guide your decisions. While other methods might focus on quick fixes, Six Sigma digs deep to find and solve the root causes of problems.
Who can use Six Sigma?
Anyone can use Six Sigma principles, not just big manufacturing companies. Whether you’re running a small coffee shop, managing a hospital, or even organizing your daily routine, Six Sigma’s problem-solving approach can help. It’s like having a Swiss Army knife of improvement tools that can be used in any situation where you want better results.
What are the levels of Six Sigma certification?
Six Sigma uses belt levels similar to martial arts: White Belt (beginners), Yellow Belt (team members), Green Belt (project leaders), Black Belt (experts), and Master Black Belt (teachers and mentors). Each level represents deeper knowledge and experience in solving problems and improving processes. It’s like leveling up in a video game – each new level brings new skills and capabilities.
How long does it take to implement Six Sigma?
Implementing Six Sigma isn’t an overnight process – it typically takes several months to a year to see significant results. Think of it like getting in shape: you need consistent effort over time to see real changes. The exact timeline depends on the size of your organization and how complex your problems are.
What are the common challenges in Six Sigma implementation?
The biggest challenges often include resistance to change, lack of leadership support, and difficulty maintaining momentum. It’s like trying to change your eating habits – you know it’s good for you, but old habits die hard. Success requires commitment, clear communication, and patience to overcome these obstacles.
How does Six Sigma save money?
Six Sigma saves money by reducing waste, preventing mistakes, and making processes more efficient. Imagine fixing a leaky faucet – not only do you save water, but you also save on your water bill. Similarly, when businesses fix their “leaky” processes, they save resources, time, and money while delivering better results to customers.
