Everything You Wanted to Know About Six Sigma
Two questions first.
1. Have you recently come across the news of some company drastically improve their performance levels or another claiming to triple their annual turnover, or even have better employee harmony? Wondered how?
2. Are you one of the many hapless business people wishing for a spray of pixie dust to miraculously save your nose-diving trade? Want to know how?
The answer to the first question and the solution to the second could be traced down to a queerly named technique developed in as early as the 19th century. The Six Sigma technique, now widely embraced by every moneymaker worth his mint, from small town merchants to mega giants, is the most popular quality measurement standard in the business world now. Maybe you and me haven’t heard about it. But there are many who have, and they are reaping in the spoils.
Academics first. Introduced as a normal curve measurement concept by Carl Frederic Gauss in the 19th century, and later adopted by Walter Shewhart, Deming, Juran, Ishikawa, and Taguchi as a measurement standard in the 1920s, Six Sigma was popularized in the mid 1980s by Motorola Chairman Bob Galvin and one of his engineers, Bill Smith. They were on scout for a more granular, more result yielding measurement standard when their eyes fell upon the combined effects of TQM, Zero Defects etc, and they formulated a system inspired by all these. Bill named it Six Sigma.
Motorola registered humungous profits from using it. Naturally, others followed suit. And as vouched by stalwarts such as Larry Bossidy of Honeywell and Jack Welch of General Electric, the benefits are manifold. More internationally speaking, Indian firms such as Wipro, Genpact, etc have made tremendous leaps in product delivery and consistency after implementing this mystical remedy.
Well then, what is Six Sigma anyway? It is simply speaking, a performance improvement approach that aims at leaner business operations and a quality level at less than 3.4 defects per a million opportunities. It uses a set of quality management methods and creates a hierarchy of Sigma specialized employees (differentiated by belts), at different tiers, who ensure highest quality at every level of the company. The two major methodologies are DMAIC (Define, Measure, Analyze, Improve and Control) and DMADV (Define, Measure, Analyze, Design and Verify). Both these are done by Green Belts and Black Belts and overseen by Master Black Belts (MBB). Green belts are the backbone of an organization, providing implementation of projects and black belts are the leaders who oversee and make decisions. Master Black Belts train both the other factions and also help out in times of emergency.
So where does ‘Lean’ come into picture? It was a method used by the Japanese in reconstruction after the Second World War when resources where at a premium. Companies like Toyota employ this technique, which aims at maximum and thrifty utilization of resources. The guys at MIT wrote a book on it, and lean manufacturing never had to look back. Lean, alone cannot provide statistical record based control to a process. And neither can Six Sigma alone bring about dramatic increase in speed or quality. Both together can, and is working wonders.
Lean Six Sigma brings about higher velocity processes ensuring timely deliveries, by identifying the delay times and wasteful work; cuts down 30-50% of complexity costs due to this. Each of the processes in DMAIC and DMADV has deeper meaning than its superficial definition. While the Define stage injects clarity and focus into the team using a variety of tools such as Critical-To-Quality Tree, the Measure stage calculates the value added times, and sorts items into order of importance using Pareto Charts and Prioritization Matrix. The Analyze stage examines the ‘whys’ and develops theories of root causes with tools like Scatter Plots, and the Improve stage demonstrates that the solutions really solve the problem. The Control stage aims to see that the faults don’t recur and that new processes can be improved over time, using tools such as PDCA cycles.
Overall, however confusing it might seem prima facie, Lean Six Sigma is a certified rage and almost guarantees assured results. But the guidance of a seasoned Kaizen practitioner is vital, as surveys have shown many mislead souls not availing the complete benefits of this wonder cure. And for all the profits that LSS brings you with it, there is someone who laughs with you on its way to the bankers. Six Sigma is a registered trademark of Motorola, and as of 2006 they have amassed 17 billion US dollars on its usage. Need any more proof of Lean Six Sigma’s benefits? You must be joking!
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