Archive for the ‘Introduction to Six Sigma’ Category

Six Sigma, Lean, and Lean Six Sigma

Monday, August 24th, 2009

Which process improvement approach is right for you and your needs?

People sometimes ask me to explain the difference between lean production and six sigma. The question is usually phrased something like, “Should I use six sigma or lean production methods to improve my operations?” Before I tell you my answer, let me provide a brief background on these different approaches to process improvement.

Lean production is based on the Toyota Production System and usually includes the elements shown in Figure 1. When properly implemented, a lean production system can dramatically improve productivity (by as much as 95 percent when compared with traditional batch-and-queue production systems).

Figure 1: Elements of Lean Production

Lean production dates back to the post-World War II era in Japan. It was developed by Taiichi Ohno, a Toyota production executive, in response to a number of problems that plagued Japanese industry. The main problem was that of high-variety production, required to serve the domestic Japanese market. Mass-production techniques, which were developed by Henry Ford to economically produce long runs of identical products, were ill-suited to Toyota’s situation. The lean approach (the term “lean” was coined in the early 1990s by MIT researchers) systematically minimizes waste–called muda–in the value stream. Muda includes all types of defective work, not just defective products. Wasted time, motion and materials are also muda.

OK, so how does this relate to six sigma? To make a valid comparison, we need a new definition of quality itself. By defining quality in terms of value rather than in terms of defects, we can see that six sigma quality involves a search for ways to reduce muda . I propose the following definition for six sigma:

  • A general approach to reducing muda in any environment
  • A collection of simple and sophisticated methods for analyzing complex cause-and-effect relationships
  • A means of discovering opportunities for improvement

The lean approach offers a set of solutions to muda in a high-variety production environment. Six sigma applies to the problems addressed by lean but also seeks to solve other problems common to production. However, because both six sigma and lean address the problem of muda, there is a great deal of overlap. The approaches should be viewed as complements to one another. Some examples of this synergism are shown in Table 1.

Table 1: The Synergy of Six Sigma and Lean Production

If you’re facing a situation where lean solutions can be used (e.g., high-variety production), you shouldn’t hesitate to implement lean: It offers proven solutions to known problems. Six sigma methods will help you with lean, and they will help you continue to improve when it’s time to move into administrative and other nonproduction areas.

Lean Six Sigma

A quick review of the above should make it clear that there is a natural affinity between Lean and Six Sigma. This has been incorporated into a single approach to business improvement: lean six sigma. Lean Six Sigma takes parts of Lean and parts of Six Sigma and puts them together in a single, integrated approach to achieving process excellence. Organizations can move from Lean or Six Sigma to Lean Six Sigma, or they can simply introduce Lean Six Sigma from the outset. If an organization is just starting the journey to excellence, I recommend the following:

  1. Begin with Lean. Identify value streams for the most important product families and move these as closely as practical to one piece flow based on pull systems.
  2. Examine the improved value streams to determine where obstacles exist to moving closer to one piece flow. These obstacles will generally be caused by excessive setup or changeover times, information flow issues, excessive variation, and other forms of muda.
    • Decide how best to deal with each obstacle on an issue-by-issue basis. Some can be remedied by “just do” projects, others by Kaizen events, others by routine continuous improvement activities, and still others by applying Lean Six Sigma

Of course, for most organizations conducting these improvement activities will require a complete transformation in the culture of the organization. But that’s the topic for another post!

GD Star Rating
loading...

Tags: , , , , , , , , ,
Posted in Introduction to Six Sigma, Leading Six Sigma, lean-six-sigma | 3 Comments »

What is a Black Belt?

Monday, August 17th, 2009

Who are they and what do they do?

I‘m often asked about the term “black belt” as it relates to six sigma. What, precisely, is a black belt? Where did the term originate? For that matter, where did the term “six sigma” originate? And, while we’re on the subject, what’s a green belt or master black belt?

Let’s start with the term “six sigma.” In a conversation with Ed Bales of Motorola University, I learned that Motorola coined the term in 1986. As those who have worked in quality for a while know, this term has statistical roots in the technique known as process capability analysis. Prior to the Japanese industrial invasion of U.S. markets, quality practitioners were happy with three sigma quality, which translates to about three errors or defects per 1,000 items for processes in a state of statistical control. Motorola discovered that its processes weren’t in statistical control–estimates based on field failure data indicated that Motorola’s processes apparently drifted by an average of 1.5 standard deviations. In a conversation with ex-Motorola trainer Mikel Harry, I learned that he considers the Cpk index–which measures short-term process variability under statistical control–worthless. Harry prefers the Ppk index, which measures actual performance rather than process capability. (Note that many experts, including me, disagree strongly with Harry on this issue.) In any case, before computing expected process failures, Motorola adds this 1.5 standard deviation. Thus, when we hear that a six sigma process will produce 3.4 parts-per-million (PPM) failures, we find that this PPM corresponds to the area in the tail beyond 4.5 standard deviations above the mean for a normal distribution.

Motorola also adopted the terms “black belt” and “green belt.” For my book The Six Sigma Handbook, I did extensive research into what employers expect of people with these titles. Here is a summary of these various responsibilities:

  • Master black belt–This is the highest level of technical and organizational proficiency. Because master black belts train black belts, they must know everything the black belts know, as well as understand the mathematical theory on which the statistical methods are based. Masters must be able to assist black belts in applying the methods correctly in unusual situations. Whenever possible, statistical training should be conducted only by master black belts. If it’s necessary for black belts and green belts to provide training, they should only do so under the guidance of master black belts. Because of the nature of the master’s duties, communications and teaching skills should be judged as important as technical competence in selecting candidates.
  • Black belt–Candidates for technical leader (black belt) status are technically oriented individuals held in high regard by their peers. They should be actively involved in the organizational change and development process. Candidates may come from a wide range of disciplines and need not be formally trained statisticians or engineers. However, because they are expected to master a wide variety of technical tools in a relatively short period of time, technical leader candidates will probably possess a background in college-level mathematics, the basic tool of quantitative analysis. College-level course work in statistical methods should be a prerequisite.

Six sigma technical leaders work to extract actionable knowledge from an organization’s information warehouse. Successful candidates should understand one or more operating systems, spreadsheets, database managers, presentation programs and word processors. As part of their training they will be required to become proficient in the use of one or more advanced statistical analysis software packages.

  • Green belt –Green belts are six sigma team leaders capable of forming and facilitating six sigma teams and managing six sigma projects from concept to completion. Typically, green-belt training consists of five days of classroom training and is conducted in conjunction with six sigma team projects. Training covers facilitation techniques and meeting management, project management, quality management tools, quality control tools, problem solving, and exploratory data analysis. Usually, six sigma black belts help green belts choose their projects prior to the training, attend training with their green belts and assist them with their projects after the training.

Although the martial arts terms described above are common, they are by no means universal. Companies and consulting firms often create their own titles to describe the work done by these technical leaders.

GD Star Rating
loading...

Tags: , , , , , , , , , , ,
Posted in Introduction to Six Sigma | No Comments »

How Six Sigma Can Help With Marketing

Monday, August 17th, 2009

Marketing is a process. Six Sigma is an approach for achieving process excellence. It will help you improve the marketing process by providing tools & techniques for identifying what the marketing process is, including suppliers, inputs, process steps, outputs, and customers. Six Sigma helps you understand the need to determine who owns the process and helps the process owner determine how to improve it. It provides a framework for improving all aspects of this process. It does much more as well. I recommend you enroll and take a week to look around the training site. If it looks like a good value to you, stay in the course and become a Certified Six Sigma Black Belt or Green Belt.

The converse is also true, marketing can help Six Sigma. Both marketing and Six Sigma focus on customers. Marketing is a management discipline dedicated to understanding customer demands, how to design products meet them, and how to let potential customers know what’s available. In Six Sigma training for Black Belts and Green Belts we teach a number of tools that are borrowed directly from marketing, such as the analytic hierarchical process, quality function deployment and Pugh matrices. Master Blacks use conjoint analysis, a quasi-designed experiment approach to measuring customer importance weights. Design for Six Sigma is all about integrating the design process across marketing, engineering, and production to better meet implicit and explicit customer demands.

Beyond the technical tools, when Six Sigma or Lean Six Sigma is well done it begins with understanding what customers are solving for, then helping them achieve their goals by improving the processes you use to provide them with service. This is truly an integration of marketing and Six Sigma.

GD Star Rating
loading...

Tags: , , , , , , , , , ,
Posted in Introduction to Six Sigma, Leading Six Sigma | 4 Comments »

Quality, Costs, and Six Sigma

Monday, August 10th, 2009

Six sigma isn’t just about quality for quality’s sake.

Your employer, Peerless Systems, acquired Acme International for its technology. But your leaders want more than just Acme’s technology; they also want Acme to be successful in its own right. But Acme has problems. Acme, it seems, is still operated as a traditional three-sigma company. Peerless has long since moved to six sigma and beyond, and you played an important role in making that happen. Your new challenge is to lead Acme from three sigma to six sigma. It’s what you’ve been waiting for your entire career–welcome to senior leadership!

You bring your staff together to establish a baseline. Bob, the vice-president of marketing, says, “We’re losing customers due to poor quality, and our competitors are killing us on price.”

Ann, your director of quality, is next. “When Bob told us about the quality problems, we increased inspection and testing, ” she says. “Field failures dropped, but (of course) costs increased.”

Figure 1: Cost and Value of Quality

Lorraine, vice-president of finance, shows Figure 1. “My staff and I believe that the customer places a certain value on quality,” she states. “At first, our quality was too low, and the customer wouldn’t buy our products. When we improved our quality, we also increased our costs, but the customer wouldn’t pay the higher prices we had to charge. We’ve found that profitability is maximized when total cost of poor quality is about 25 percent of sales. The problem is that there is very little profit, even at that cost level.”

This all has a familiar ring to you. You know that the typical three-sigma company spends about 25 percent of each sales dollar on the cost of poor quality. Before starting the six sigma journey, Peerless was in similar shape. You’ve prepared the slide shown in Figure 2 to illustrate the difference between three-sigma and six-sigma quality for your staff.

Figure 2: Three Sigma Profits
vs. Six Sigma Profits


“Right now, our business is only capable of operating at a level equivalent to about three-sigma quality,” you explain. “Trying to get better quality out of our existing systems only adds costs. We must develop new systems that deliver better quality and lower costs simultaneously. We need six sigma systems.”

You go on to describe the differences between six sigma systems and three sigma systems, and the importance of six sigma to Acme. You tell them that six sigma is not a destination, but a journey of continuous improvement. Of course, Acme won’t go from three sigma to six sigma in one big jump. Instead, overall performance will move from three sigma to four sigma, then to five sigma and so on as people are trained and systems redesigned and improved. Figure 3 illustrates the expected progress toward six sigma.

Figure 3: The Journey to Six Sigma

You summarize by telling your staff that six sigma is not about quality for the sake of quality; it is about providing better value to customers, investors and employees. Paraphrasing the Chinese philosopher Lao-tzu, you announce, “Six sigma is a journey of a thousand miles. Creating a roadmap that links customer satisfaction, quality and costs is the first step.”

GD Star Rating
loading...

Tags: , , , , ,
Posted in Introduction to Six Sigma, Leading Six Sigma | 3 Comments »

How to Integrate Six Sigma and Innovation

Monday, August 3rd, 2009

To make your customers truly happy, you must go beyond six sigma.

Some people, including me, believe that garden variety six sigma doesn’t go far enough. In fact, even zero defects falls short. Defining quality as only the lack of nonconforming product reflects a limited view of quality. Of course, that was never Motorola’s intent when it invented the Six Sigma program. However, the misinterpretation prevails.

Progressive people in the six sigma camp move beyond defining quality in terms of defects and defectives. This group looks for critical-to-quality (CTQ) characteristics in a product or service. CTQ features are those that customers expect and consider explicitly when evaluating product or service quality. A product or service that doesn’t provide the CTQ features that customers expect suffers lower customer satisfaction. But even this definition isn’t enough. The problem is illustrated by the Kano model of customer satisfaction (see Figure).

Garden variety six sigma only addresses two-thirds of the Kano model: Basic Quality features and Expected Quality features. When six sigma addresses nonconformances and defects, it’s focusing on the Basic Quality curve in the Kano model. When these items are handled perfectly, the result is a customer who is not dissatisfied. This is certainly important, but “not dissatisfied” is hardly a rousing endorsement of a product or service.

Six sigma activities that seek to identify CTQ characteristics address the portion of the Kano model on and below the line labeled “Expected Quality.” If all CTQ characteristics are properly produced, the result will be a satisfied customer. Important, of course, but is it enough to simply satisfy the customer?

Even perfection in these areas won’t ensure that the organization remains viable in the long term. The Competitive Pressure curve on the Kano model indicates that market forces will make today’s expected quality features tomorrow’s basic quality features. Long-term success requires the customer to be excited by unexpected innovations provided by a company’s products and services: Continued survival requires that your organization continuously innovate. Innovation is the result of creative activity, not of analysis. Creativity can’t be achieved “by the numbers.” In fact, excessive attention to a rigorous process such as six sigma actually detracts from creativity. The creative organization is one that exhibits variability, resource redundancy, quirky design and slack. It’s vital that the organization keep the Six Sigma Management Paradox in mind: To attain six sigma performance, we must minimize process variability, slack and redundancy by building variability, slack and redundancy into our organizations.

The key is to keep human enterprises and processes separate. You can encourage creativity in your company if you:

  • Celebrate failure. Most innovations fail to produce the hoped-for progress. Management must not only tolerate valiant efforts that fail, but they must also make it clear that such efforts are valued.
  • Create quality time. Set aside a specified block of time each day or each week for creative activity. During this quality time, people aren’t allowed to spend time on routine work; they must focus instead on how they can improve products, processes or service. When I owned Quality America a number of years ago, I designated the last hour of each day “Quality Hour.” I believe that Quality Hour helped us more than double our sales without the need for additional personnel, not a bad return on investment for an investment equal to 12.5 percent of payroll!
  • Reduce procedure protocols . Although process control and quality control bring better products at lower costs, these control systems also inhibit experimentation and innovation. Quality professionals should study existing systems to determine how little control is absolutely necessary to protect the customer and the brand.
  • Mass DOE education. Statistical design of experiments (DOE) is a complex and advanced subject area. But it is possible to develop easy-to-use DOE systems that everyone can use. For example, quality engineers can develop spreadsheets that allow employees to easily evaluate two-level experiments for three or four factors simultaneously. By working with information systems departments, we can help everyone get access to the data they need to determine which areas require improvement and to monitor the results of their experiments.
  • Utilize undesigned experiments. Despite the fact that DOE is the method of choice, we can learn a lot from ad hoc changes to processes. By allowing people to experiment without getting permission, we increase variability and increase the chance that we’ll learn something. We must establish guidelines to protect the customer and to protect the employee from reprisal should things not go as hoped.

These ideas can work in practice. Send me e-mail to let me know what suggestions you have for helping organizations become more innovative. If I get a sufficient number of responses, I will print them in a future column.

GD Star Rating
loading...

Tags: , , , , , , ,
Posted in Introduction to Six Sigma, Leading Six Sigma | 3 Comments »

Creativity and Six Sigma Breakthrough

Monday, July 20th, 2009

Creative breakthroughs occur only when we have the freedom to try new things.

Simply stated, the six sigma management paradox is as follows: To attain six sigma performance, we must minimize process variability, slack and redundancy by building variability, slack and redundancy into our organizations.

Six sigma involves an intense effort to reduce process variation to a minimum so that processes consistently meet or exceed customer expectations and requirements. However, revolutionary improvement rates and quality levels can only be achieved by breakthroughs in thinking. These creative breakthroughs can occur only if the organization allows teams and individuals the freedom to try many new things. Whenever something new is tried, there is a risk of failure, which increases waste in the short term. The best minds will be drawn to creative activities (and away from their usual duties) as moths are drawn to light. The organization must possess sufficient slack–i.e., extra resources–to ensure that critical functions continue despite the absence of these key personnel.

Leaders must be vigilant to ensure that the paradox is understood. When one learns a new principle, there is a tendency (especially in the beginning) to go overboard in applying it. A fundamental principle of six sigma is reduction of variability. The tendency is to apply this principle to everything . Advocates examine every process with an eye toward bringing it under control; that is, making the process efficient, capable and predictable. In the early stages, the payoffs from these activities are often huge because the organization is awash in wasted resources and nonproductive or counterproductive activity (i.e., redundancy and slack). However, as progress continues, there is less and less unplanned slack in the organization. If care isn’t taken, six sigma can ultimately result in an organization that is unable to grow and adapt to a changing environment.

The common form of many modern organizations is what I call “hard wired.” The organization chart is the blueprint, and the policy-and-procedure manuals are the operating instructions for this machine. As with a circuit board, the idea is that certain outputs (products, services, profits) will be produced when certain inputs (money, people, ideas) are provided. Such organizations are highly efficient; resources are carefully managed to avoid waste. However, they are also very inflexible and difficult to change. These organizations tend to rely heavily on formal mechanisms, such as chartered teams, to create change. Senior management forces the various functions to provide resources (people, facilities, etc.) to the teams, in effect tapping into the main resource circuits to draw off energy for change. Maintaining the momentum for change in these organizations requires the vigilance of top management because the “true” resource owners–the managers of the functions whose resources are being appropriated–are constantly trying to stop the energy drain from their areas. Such organizations are constantly fighting “resistance to change.” Six sigma tends to work poorly in hardwired organizations because it’s difficult to get the required resources and the necessary permissions to conduct experiments and make process changes.

A second type of organization is the “soft wired” organization. In a soft-wired organization, there are floating resources that are not fully under the control of a particular function. These resources can be easily reconfigured to perform a variety of different activities. 3M’s tradition of allowing certain technical people to claim 15 percent of their time to pursue projects of their own choosing is an example of soft-wiring. The Brazilian company Semco has freelance engineers who report to no one and receive a share of the proceeds from any ideas and innovations they dream up. There are many other examples of soft-wiring, and they produce amazing results. The soft-wired organizational form is well-suited to the rapid but directed change six sigma requires.

An emergent third type of organization, about which I write extensively in my book The End of Management, is the “spontaneous enterprise.” Scientists call these organizations “complex adaptive systems.” Such systems are all around us; examples include the rain forest, the brain and the free market. They are vastly more complex than any business firm, and also very orderly. Until recently, we could only marvel that these amazing systems could exist and function so beautifully without a leader or a plan. However, scientists have finally begun to discover the rules that govern such systems. With our new understanding, we can see how we might design more effective human organizations. They could depend on self-organization, rather than on a costly and ineffective system of rules and hierarchy (i.e., management), for order. At this time, there are only a few organizations of this type, such as the credit card behemoth VISA. However, as we learn from these pioneers, we should see more spontaneous enterprise organizations.

Because six sigma is a management program, it would need to be radically modified to work as part of a spontaneous enterprise. One possibility is that six sigma technical leaders would play important supporting roles to leaders, providing them with information to help them maintain a competitive edge. Regardless of how we administer a six sigma program, its paradox will always apply–even to the most complex of organizations.

GD Star Rating
loading...

Tags: , , , , , , , , , ,
Posted in Introduction to Six Sigma, Leading Six Sigma | 2 Comments »

A Quality Lexicon

Thursday, July 2nd, 2009

Let’s define those buzzwords we use every day.

In the deployment of six sigma, we usually begin by defining our terms. I must admit to negligence in this regard, because I haven’t yet defined for you what I mean when I write about “quality.” As this definition is at the root of all of our discussions in one way or another, it deserves and needs to be stated in explicit terms.

Let’s start at the beginning: ethics. Most of us feel that quality is important because it’s “right” at a fundamental level. Conversely, failing to provide the best possible quality is considered somehow “wrong.” These feelings of right and wrong are implicit in discussions of quality and are the source of heated debate between quality practitioners and others. But feelings aren’t tools of cognition; they’re automatic responses based on previous conclusions. As such, they may be in error. If feelings are to provide a useful guide for behavior, they must correspond to reality. Let’s see if we can validate the feeling that quality is “good.”

Productiveness and honesty are the moral virtues upon which the concept of quality is based. Productiveness is the process of sustaining your life by using your mind.1 Most of us spend a substantial percentage of our waking hours engaged in this pursuit. Productive work is the central purpose of rational people’s lives and the central value that integrates and determines the hierarchy of all of their other values. Reason is the source, the precondition of a person’s productive work. Pride is the result. Productiveness involves reshaping the world in the image of one’s own values. Honesty is the refusal to fake reality to acquire value. When managers know how to provide greater quality but fail to do so, they are being dishonest. Employees who fight to keep jobs that are no longer needed, or who fail to perform their jobs to the best of their ability, are likewise being dishonest.

With these terms defined, we’re ready to define quality: Quality is the value added by a productive endeavor.

Quality comes in two flavors: potential and actual. Potential quality is the known maximum possible value added per unit of input. Actual quality is the current value added per unit of input. The difference between potential and actual quality is waste. Waste, we all know, is bad, and now we know why it’s bad: It’s dishonest.

Quality science is the attempt to increase potential quality through mental and physical effort. It’s the systematic search for knowledge of productivity improvement. It may involve creating more value with the same resources, creating the same value with fewer resources or creating entirely new values.

Quality improvement is the process of increasing actual quality through mental and physical effort. This can be done by either reducing waste or developing new systems that increase both actual and potential quality. Because quality is value-added, it can be measured for any process that adds value.

In any enterprise, all stakeholders engage in a value exchange. Employees exchange their labor and ideas for monetary compensation in the form of wages or bonuses. Owners exchange their investments for a financial reward. Managers exchange their organizational and planning systems for monetary compensation. Customers exchange their money for the benefit they derive from the product or service.

These value exchanges are based on the belief that other parties in the exchange are performing to the best of their abilities. Investors assume that management utilizes the assets entrusted to them in the most effective way they know. Owners expect management to look for better ways to utilize the organization’s assets. Management assumes that employees will, to the best of their abilities, do the jobs they are paid to do and offer suggestions for how the job might be done better. Employees assume that they will be rewarded commensurately to the value they create. Customers assume that the products and services provided are the best the company can produce consistent with the rightful interests of the owners, managers and employees.

Because everyone knows that these assumptions are held by the various parties, any departure from them is dishonest unless the departure is made explicit. In short, all stakeholders are entitled to receive maximum value from any exchange.

The rate of exchange for these values is established by the market. The market’s moral function is to establish an honest rate of exchange. This is what we mean when we say that inefficient producers or producers of shoddy merchandise are “punished” in the marketplace. Ultimately, in a free market, reality determines the value of an exchange. Dishonesty (i.e., creation of a fake reality) is impractical in all its forms, including poor quality. When poor producers suffer in the marketplace, it isn’t punishment–it’s justice.

1 . Definitions of philosophical terms discussed in this column are from The Ayn Rand Lexicon: Objectivism from A to Z, edited by Harry Binswanger (www.second renaissance.com).
GD Star Rating
loading...

Tags: , , , , , , , , , , , , , , , , , , ,
Posted in Introduction to Six Sigma | No Comments »

Six Sigma: 5 Reasons why Big Business is Going Geek

Friday, June 19th, 2009

Businesses always want to cut down on costs, improve profits, and drive the bottom line. Yet, increasingly companies are learning that the traditional practices just won’t cut it anymore. They are turning to Six Sigma, which applies statistical practices to management, to get their answers. But Six Sigma is little more than a geek’s approach to management. The methods used are nothing new to programmers, hackers, hardware nuts, and IT guys. In this article, I’m going to show you why big business has seen the light, and is learning to think like a geek.

1. Thinking like a programmer exposes waste

In Six Sigma, you control a process. However, to control that process you have to first break it down and clarify what you mean. Programmers know this well: Define and Conquer. Incidentally, this corresponds to the first step of one of Six Sigma’s guiding methods, DMAIC. The descriptions that you come up with for Six Sigma are a lot like those for programs. You have your list of inputs (customers in a call center, for example), outputs (the customer’s satisfaction with the service), and functions (the waiting queue). When you think like a programmer, things become a whole lot clearer.

2. Benchmarking tells the story better

People exaggerate, your eyes can deceive you, but numbers never lie. Six Sigma forces businesses to measure aspects that they had previously ignored. More importantly, figuring out the right numbers to measure leads to success. Computer geeks have known this forever, though. Pull out a computing magazine and you’ll see page after page of meaningful benchmarks. Just like Six Sigma metrics, you have some that show under-the-hood information, like MIPS, and others that show the bottom-line, like render times in Photoshop.

3. Crunching the numbers distills the information

Even if you are measuring all the right metrics, you have to make sense of it all. Computers are perfect for this. Advanced statistics, simulation, and forecasting software all exist to make sense of the data. However, this is heavy duty software that takes time and effort to learn. This is the sort of computing task that geeks excel at, and business leaders with a knack for numbers are becoming a precious commodity in this world where Six Sigma reigns supreme.

4. Engineering solutions save money

After all of this work, numbers will start to become clear that point towards areas of improvement. What is needed now is that creative spark that engineers are known for. There’s a certain “Work Smarter, not Harder” approach that geeks are great with. For example, if you want to cut down on wait times in a call center, the natural approach would be to add more agents, but a better approach would be to direct calls to the fastest agents first. Many of these tricks for improved speed and reliability are pulled straight from computer networking, and are old hat to geeks.

5. Working like a (good) programmer helps maintain excellence

Every programmer has heard it a million times. Comment your code, document your versioning, always bug-fix, and keep backups. This is just like the control phase of DMAIC in Six Sigma. Like commenting code, documenting the process saves other people much work in the future. It’s boring and tedious, but a year down the road, it will pay off. Similarly, fixing the new problems that come up is an important part of the Six Sigma process. Businesses are finding that you don’t just make a change and walk away, but you keep iterating until you get it just right. Programmers have known for years that the when version 1.0 comes out, you’re just getting started.

What do you think? Do geeks have a leg up on everyone else when it comes to Six Sigma, or are these skills that anyone can learn even if they’ve never touched a programming manual?

GD Star Rating
loading...

Posted in Introduction to Six Sigma, News | No Comments »

Six Sigma-Love It or Hate It?

Monday, June 15th, 2009

For a technical topic, Six Sigma tends to generate a lot of strong feelings. As the author of The Six Sigma Handbook I obviously have a few of these feelings myself. Still, on balance, I’m a Six Sigma “lover.” I think that the approach is an excellent way to help organizations achieve their goals by improving their core processes. However, I am not blind to the fact that Six Sigma also has its dark side. Here are a few examples that leap readily to mind.

Six Sigma everywhere. Some organizations apply Six Sigma where it really shouldn’t be applied. For example, one of my clients tried to apply it to an R&D operation. The poor folks trying to create something brand new from scratch were forced to try and figure out how to measure their progress, submit regular reports, track metrics on control charts, show process improvements, etc. It was a disaster. Six Sigma is a process improvement methodology, and it generally does this by reducing variation and eliminating errors and waste. Creativity involves innovation and risk taking. It deliberately introduces variability by changing things to try and discover something new. It is inherently and unavoidably wasteful. There is no process for understanding inspired creativity and it can’t be quantified until after it has generated failures and successes. The value of innovation can’t be measured until after something great has been achieved, and it’s not possible to tell if you’re 1% of the way to the achievement, or 99%. You won’t know until you get there.

The Elites Six Sigma has an infrastructure of “Belts” that have an air of elitism about them. Of course, there is also an air of elitism around other groups within an organization. In manufacturing it is the engineers, in healthcare the physicians, in insurance the actuaries. Why all of the animosity towards the Belts? My theory is that it happens so fast, and it happens to people who already have a defined status in the organization. One minute John or Jane are ordinary blokes, the next they are exalted Black Belts. What’s up with that? To help promote Six Sigma in organizations just starting the initiative, the newly minted Belts are announced on the company web site and written about in the company newspaper. To make matters worse, the group of Belts use jargon that others can’t understand and, frankly, some of them lord their new status over others.

Still, having this cadre of people whose job it is to pursue change project is perhaps the single most important thing that made Six Sigma work where TQM and other change initiatives failed. Organizations didn’t just mouth nice sounding words about the importance of change, they put their resources where their mouths were.

Most people don’t like change. In my boyhood home of Nebraska there was a common saying, “If it ain’t broke, don’t fix it.” The message was clear: don’t change anything unless it is absolutely necessary. The problem with this approach is that, in a world where your competitors are changing things at a rapid rate, if you wait until the need for change is painfully obvious, you may be too late.

Nobody wants someone telling them how to do their work. If you’ve been doing a job for a while, chances are you’ve become pretty good at it. No matter how much training you received, you learned a lot from the school of hard knocks. Now along comes this bunch of outsiders telling you that they have a better way of doing things. The reaction? Yeah, Right! If the team knows what they’re doing they will ask you for your input and they will use it to make your job easier or better. But if they don’t, they’ll make it harder and less pleasant.

Fear of job loss. It can be frightening to see how much waste there actually is in some systems. I’ve seen departments with 25 people before a Six Sigma project and 5 afterwards. The smart company will plan for this kind of impact and have new jobs for those no longer needed. But many companies simply let the displaced people go. It’s no wonder that the result is fear of Six Sigma shining a light into your work area.

Unintended consequences. If the team isn’t extremely careful, Six Sigma projects can break one thing as they improve another. The control phase of the project is supposed to prevent this from occurring, but sometimes it happens anyway. Despite all efforts there will be times when changing something results in unforeseen problems, it is the nature of change. When it happens, it will produce resentment.

Six Sigma is used when a simpler approach would’ve worked just as well. Six Sigma DMAIC or DfSS projects have their rightful place. But let’s face it, the Six Sigma approach is a problem-solving sledge hammer. Sometimes a fly swatter is more appropriate.

Six Sigma people get credit for ideas originally conceived by others. One of the main bailiwicks of Six Sigma is the problem that has been “solved” over and over again. When chronic problems are attacked by Six Sigma teams it is almost certain that the final solution will incorporate elements of things that were proposed, and maybe even tried, in the past. The people who had thought of the the fix before the Six Sigma team probably tried and failed to get their solutions implemented. Six Sigma tends to receive more resources and management support than lone problem solvers. The resulting hurt feelings can be ameliorated-but not eliminated-by recognizing those who tried to raise the flag in the past.

While some of these things can be avoided, Six Sigma will always have its dark side. Six Sigma is all about change and change is inherently risky. However, change is also vital to survival. The battle between stagnation and chaos is never ending.

GD Star Rating
loading...

Tags: , , , , ,
Posted in Introduction to Six Sigma, News | 1 Comment »

P.F. Chang’s Simple Recipe for Profits

Sunday, May 31st, 2009

Newsweek Voices – Daniel Gross | Newsweek.com.

Newsweek reports that P.F. Chang’s has bucked the trend of other restaurants by not only opening new stores, it has also increased its profits by 38 percent compared to first quarter 2008. According to Co-CEO Rick Federico, P.F. Changs has done this by focusing its attention on identifying its core business processes and eliminating waste in the form of, "all elements of our business that don’t touch our guests or our products." This is, of course, a fundamental principle of lean and Six Sigma. Practitioners of these two process improvement disciplines have long known that improving process efficiency and reducing or eliminating waste is a foolproof way to grow value for all stakeholders. These seemingly small improvements add up to dramatically better customer and employee experiences and set the businesses who use them apart from their competition.

Chang’s is one of a growing number of businesses in non-manufacturing sectors who are showing that the lessons learned by companies like Toyota can be applied anywhere there are processes involved.  When an organization directs the attention of managers and workers on improving the systems they work with, the result is an improved customer experience and lower costs of doing business, which benefits shareholders. Employees also enjoy working with processes that are more rational and less wasteful. Of course, in a down economy, employees appreciate simply having a job at all. While companies like P.F. Chang’s grow, sales in the casual dining sector in general fell precipitously. A survey by the Boston Consulting Group shows that the sector is among the hardest hit by consumers choosing to cut back on discretionary spending. For those companies that aren’t improving their processes, times are lean indeed.

GD Star Rating
loading...

Tags: ,
Posted in Introduction to Six Sigma, News, Uncategorized | No Comments »

« Older Entries
Newer Entries »