Introduction to Six Sigma

Introduction to Six Sigma is necessary as Six Sigma is seen only as a continuous improvement method. However Six sigma has many faces. It is originally developed as a Quality management program in Motorola in the 1980s; Adopted with a zeal by GE in mid 90s; Being used effectively all over the world now. The goal of six sigma is to achieve continual improvement. The term Six Sigma is used in many contexts with an aim of Continual Improvement. Some of them are listed below.
Six Sigma is used as a Management Philosophy focused on business process improvements to:

  • Eliminate waste, rework, and mistakes
  • Increase customer satisfaction
  • Increase profitability and competitiveness
  • Statistical measure to objectively evaluate processes.

Six Sigma is used as a business strategy by concentration on Quality and defect reduction resulting in increase profitability and competitiveness. Fewer defects will lead to increased reliability and brand popularity.
Six Sigma is used as a metric to define the Quality of the output and ability of production process to produce defect free output.  
Six Sigma Is a Method for Continual Improvement. This is the most popular use of this word. A six sigma project has a defined method of an improvement project. These are DMAIC and DFSS.
Six Sigma is a Benchmark or a Goal to achieve the highest standard of productivity. A Six Sigma Quality is equal to less than 3.4 defects per million opportunities. This is the Vision for most of the organizations to make sure they deliver high quality to the customers.
Six Sigma is a Statistical Measurement to define the process Capability based on Standard deviation. For any normal distribution, the process capability is equal to six Standard Deviations.
Six Sigma is used in many other contexts which are most relevant and make sure customer satisfaction.
An organization can easily tell the customer about its quality by using the term six sigma.

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Originally posted 2013-03-17 13:02:00.

Prioritizing Generated ideas using Project Prioritization Matrix

Previously we have discussed various ideas which can be considered for a Continual Improvement Project. Once all the ideas are identified, you need to rank these ideas. A total value for each project is calculated and plotted against an ease of completion number to decide which projects have the most value for the effort expended. The tool used to complete this technique is called as project prioritization matrix

Why Prioritization

  • Prioritization will keep your focus on the high impact improvements. it is always advisable to keep the focus while attempting the improvements. Additional benefits include greater visibility and acceptance from the stakeholders. A carefully selected project can be a game changer with respect to the perception on the Continual Improvement in any organization.
  • Prioritization helps you to rank potential projects by both their weighted benefits and their relative ease of completion.
  • It also helps in reorder the ranking of projects if the weighting of the company’s strategic goals changes (such as, the last Quarter there will be very high focus on the Revenue and targets.)

How to prioritize ideas 

  • Identify a list of project selection criteria (For example Revenue, Cost, inventory customer satisfaction, etc)
  • Develop a list of potential projects and enter in the left column of the table
  • Assign weightage to the criteria on top of the list. A weightage can be given based on the impact like 0- No Impact, 1- Low Impact, 3- Medium Impact and 5 – High Impact).
  • Using a team, develop a score for the criteria.
  • You will get the Priority Number based on Multiplication of these two.
  • You can order them according to the priority Number
  • After a project prioritization matrix is created, you can easily update it by adding new potential projects and changing the weighting of the project values to reflect changes in organizational priorities.
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Originally posted 2013-03-10 12:02:00.

Ideas for Six Sigma Projects – By Function and Industry

We have discussed the General Ideas and Ideas from Issues earlier. Here is another trigger for you to look into ideas for Six Sigma Projects by function. If you are new in the continual Improvement Journey, these various classifications help you project identification and selection. Classifying ideas for Six Sigma Projects by function will help you to ignite those who have less time to look at general issues.
Few years back it was generally believed that the six sigma method is used for Manufacturing Industry is only. How ever, Many service and IT organizations have adopted this and saved tons of money. Even this method can be used to increase the process speed and lean out the process. You may take up the improvements in a step by step approach which can give you better clarity and improve the system.

Project Selection Ideas By Function

Six Sigma Project Ideas for Finance/Accounting function
Reduce the time taken to close the accounting books (cycle time)
Improve the forecast accuracy
Spending control
Reduce balance sheet risk
Eliminate unstable customers and associated risks
Improve processing of payment to vendors/suppliers
Improve Days Sales Outstanding (DSO) — the average time taken by a company to collect payment from its customers
Reduce payroll process cycle time
Improve cash management processes
Improve payment/collection processes
Reduce electronic financial transaction costs
Reduce the cycle time of reconciliation
Reduce the procure to pay cycle
Standardize the accrual and deferral processes
Cycle time reduction in processing of Invoice generation
Reduction of cycle time in Purchase order generation

Six Sigma Project Ideas for Human Resources function
Reduce the turn around time to hire an employee
Reduce the time to process an insurance claim
Improve employee on-boarding and orientation processes
Reduce expenditures for recruiting firms
Improve hit-rate for successful hiring
Reduce Attrition
Improve timeliness and the value of employee performance reviews
Reduce absenteeism
Improve training efficiency
Improve employee satisfaction
Identify and correct retention issues

Six Sigma Project Ideas for Sales function
Improve cross-sell opportunities
Reduce time required to enter sales orders
Reduce errors and rework associated with sales orders
Reduce customer credit worthiness cycle time
Reduce the number of “bad deals” that are processed
Improve the cycle time of the entire sales order to cash process
Increase repeat orders/customers

Six Sigma Project Ideas for Shipping/Receiving function
Improve on-time delivery of products to customers
Improve on-time delivery of goods to our facility from vendors
Improve documentation accuracy
Reduce line downtime due to shipping/receiving
Improve inventory control/rotation
Improve inspection processes
Reduce the space occupied by the inventory

Now for some of the ideas by Industry. This section can be used by linking the ideas to specific industry

Sis sigma Project Ideas for Information Technology Industry
Reduce network/server/application downtime
Improve process of logging-in to network from remote locations
Improve system reliability/uptime
Standardize computer loads for configuration and support productivity improvement

Six Sigma Project Ideas for Product/Service Design industry
Reduce time required to design a product or service
Reduce errors in design
Reduce production time
Reduce testing time
Optimize Inventory

Six Sigma Project Ideas for Call Center Industry
Increase/decrease (depending on your business needs) average talk time
Reduce abandon calls
Improve employee knowledge
Reduce number of times customer is put on hold
Reduce Call drops
Improve resolution of queries
You may start resolving problems and  one at a time. do not attempt a great improvement at once. In case you have to then pilot the solution and deploy horizontally.

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Originally posted 2013-02-27 00:23:00.

Six Sigma Project Selection – Ideas based on issues

Previously i have mentioned some obvious areas which can be looked into where you are likely to pick some projects. Here are some more ideas which will guide you towards your continual improvement journey and six sigma project selection.
To build the culture of excellence through continual improvement, you need to start at some point and show some results. One good project completed will get push from the management to believe that continual improvement must be the strategy to grow. It can be used to scale up and bring in more value to the stake holders. If the strategy includes involvement of people, this will spread like a wild-fire across the organization. Here are some ideas based on issues currently faced by the people in the organization. As a mentor, i would suggest to start one of these ideas for six sigma project selection to prove the results in short-term and get the buy in from the stake holders.

Efficiency/Capacity Issues
Processes producing less than expected
Processes requiring overtime not requested by a customer
Processes requiring cycle times in excess of expectations
Processes with computer/machine downtime
Processes requiring expedited shipping and associated costs due to delayed output production
Any process that has added labor to make the required cycle
Too much of waiting between hand offs
Call drops or disconnects during customer calls.
Low customer Satisfaction

Understanding Process Variation
How much variation is there in your incoming materials and/or process parameters and how does this affect your output?
Where do you need the input controlled to always have a good output?
Can you scientifically adjust your process to compensate for changing material, weather, etc.?
Can your Black Belt help your supplier do a project to control the incoming product where you need it?
Does understanding your inputs allow you to produce a good part using less material?
Time taken for each call by various employees
Time taken for invoicability of the resources.

This list can go on. Essentially the power of Six Sigma is really great and can be applied across all issues to be solved. However, there is no point in making a project when you have obvious solutions visible. If you have obvious visible solutions they shall be implemented before taking up a six sigma project.

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Originally posted 2013-02-24 08:27:00.

Identification of Six Sigma Projects – Idea Generation

We had some guidance on the six Sigma Projects. Now let us focus on identification of Six Sigma Projects.
Six Sigma is accomplished one project at a time. Identification of Six Sigma Projects shall aim at breakthrough Improvements and not simple goals. The billion of dollars saved by companies around the world is the cumulative effect of properly selecting and defining business issues that can be assigned to Green Belts and Black Belts for solution.  Six Sigma projects are a key action that you can take to reach your organization’s strategic goals.

I have gathered some of the ideas for the Six Sigma Projects from Various Sources. Some of these are obvious and can be applied across any organization after careful evaluation. You can study them, based on your current status these can be implemented formally as projects. the prioritization shall be specific to the organization. The best approach would be pick the idea, do a brainstorming and finally come to a conclusion on the priorities. The prioritization can be done based on the current status, Quickness in results, availability of data, and so on. One of the Main criteria shall be the priorities of the Top Management who must commit the resources and give support for the project to be a success.

General Ideas for Six Sigma Projects.

  1. Customer Satisfaction improvement.
  2. Reduce the Scrap or rejections
  3. Reduce the down time of resources (Machinery) or to increase uptime.
  4. Reduce the Rework
  5. Increase the output
  6. Increase throughput (output from multiple processes, locations, departments) or Reduce bottlenecks
  7. Reduce Quality Defects from the output
  8. Reduce customer complaints.
  9. Increase the process Velocity ( lean)
  10. Any item reworked in a process (sales contracts, invoices, surgeries, software, etc.)
  11. Reduce the Process Variation (Sales, Purchase, Recruitment  Etc)
  12. Reduce Variation of input consumption (product)
  13. Reduce the time taken for Inspection
  14. Reduce the multiple hand-offs
  15. Findings from the Internal, External, Customer and Regulatory Audits
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Originally posted 2013-02-23 19:15:00.

Project Identification guidelines

We may have to decide on weather we need to approach the problem at hand using Six Sigma Methodologies. Here are some hints Which are generally accepted project identification guidelines which can really fit into  Six Sigma.
Any project should have identifiable process inputs and outputs.
A good six sigma project should never have a pre-determined solution.  If you already know the answer, then just go fix it!
For projects that have operator or operator training as an input, focus on ways to reduce operator variation, thereby making your process more robust to different or untrained operators.
All projects need to be approached from the perspective of understanding the variation in process inputs, controlling them, and eliminating the defects. 

If you are using the Secondary data validate the data first. If you are not confident of the authenticity or integrity of the data, it is better to recollect the data.
You should have enough data to start with. If you do not have data or it takes too long to collect the data look for alternates. About 30-40 data points minimum in a month is ideal. 
The team should be committed to the improvement project.
Sponsor should see the measurable benefits to have the support.
If geographical separation within the team is there, then finding a workable solution before start of the project. In fact many projects fail due to this constraint. 

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Originally posted 2013-02-22 20:31:00.

What is Value Stream Mapping (VSM)

Value Stream Mapping (VSM) is a Lean tool, to visualize the various steps and their contribution to the overall process.
When a product or service has been perceived or appraised to fulfill a need or desire–as defined by the customer–the product or service may be said to have value or worth. Components of value may include quality, utility, functionality, capacity, aesthetics, timeliness or availability, price, etc.
Value Stream

All the activities (both value-added and non-value added) required within an organization to deliver a specific service; “everything that goes into” creating and delivering the “value” to the end-customer.
Process Map
A visual representation of the sequential flow of a process. Used as a tool in problem solving, this technique makes opportunities for improvement.
Value Stream Mapping A graphical representation of all tasks and activities needed to transform input materials and information into an output. 
Value Stream Analysis – The identification of all the specific activities occurring along the value stream, represented pictorially in a value stream map; see waste, unevenness, and overburden, size the opportunity, share a vision, communicate visually, permission to change, predict results
Non Value Added (NVA) – 
Those process steps in a Value Stream that take time, resources or space, but do not transform or shape the product or service to meet the needs of the customer 
Value Added Activity – An activity can qualify to be value adding, if the customer cares, perceptable change and first time right.
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Originally posted 2012-08-26 08:06:00.