WHEN QUALITY BECOMES A MAJOR CONCERN FOR YOUR ORGANISATION, WHO CAN YOU TURN TO? WHILE THERE ARE A NUMBER OF PROCESS MANAGEMENT APPROACHES OUT THERE TODAY, IF YOU’RE A BELIEVER IN SIX SIGMA, YOU SHOULD PROBABLY DIAL THE ‘BLACK BELTS’
Most managers have heard of Six Sigma. However, not everyone can explain it. Nor is it easy to fathom how (or why) black belts, green belts, statistics, data mining and mapping all come into it. Well, look no further – here we demystify the basics of Six Sigma and tell you how organisations that have implemented it have benefited from it.
To put it simply, Six Sigma is a data-driven approach that can help any organisation – whatever sector or field it might be operating in – bring down inefficiencies and save time and money by reducing ‘quality variations’. Several medium and large-sized Indian organisations have been relying on Six Sigma and they have implemented it fully, partially or with modifications to suit their needs.
What is SIX SIGMA?
Well, it’s not too different from going to the doctor. What is seen as a problem is often only the effect, or some times the symptom. Just as some doctors treat the symptoms of the problem by prescribing symptomatic medicines to suppress the problem, organisations often try to find quick fixes to some of their chronic problems.
As defined by Wikipedia, Six Sigma is a business management strategy originally developed by Motorola, USA in 1986. As of 2010, it is widely used in many sectors of industry.
Six Sigma seeks to improve the quality of process outputs by identifying and removing the causes of defects (errors) and minimizing variability in manufacturing and business processes. It uses a set of quality management methods, including statistical methods and creates a special infrastructure of people within the organization (“Black Belts”, “Green Belts”, etc.) who are experts in these methods. Each Six Sigma project carried out within an organization follows a defined sequence of steps and has quantified financial targets (cost reduction or profit increase).
The term six sigma originated from terminology associated with manufacturing, specifically terms associated with statistical modeling of manufacturing processes. The maturity of a manufacturing process can be described by a sigma rating indicating its yield, or the percentage of defect-free products it creates. A six-sigma process is one in which 99.99966% of the products manufactured are statistically expected to be free of defects (3.4 defects per million). Motorola set a goal of “six sigmas” for all of its manufacturing operations, and this goal became a byword for the management and engineering practices used to achieve it.
However, Six Sigma gets to the root of the problem and deals with it at the very fundamental level. And of course, instead of doctors, the people who work to heal, expedite and optimize organisational processes are called black and green belts.
NOBODY’S PERFECT, BUT…
You can certainly make a real effort, with Six Sigma. Yes, the basic aim of adopting Six Sigma is to take organisational processes to the level of near-perfection. Just like other quality management approaches such as Kaizen and TPM, Six Sigma focuses on people working in teams, and continuous improvement as the keys to attaining an optimum point of functioning. This is critical not only for corporations, but also sectors like healthcare, aviation, public utilities and others, where delivery and quality of services offered are important. Often, a consultant’s assistance is sought, since organisations usually don’t have the people and resources to implement Six Sigma on their own.
Keep in mind here that Six Sigma is an ideal and many companies are around the 3-4 sigma level, which means that the numbers of errors per million ‘opportunities’ is much more than in a five or six sigma organisation.
Another reason Six Sigma is so popular, is because it saves corporations megabucks.
Experts say that the target gains in profit for 2006–07 through Six Sigma are over a million USD for the organisation. Six Sigma is chosen after carefully study, because it supports our goal of a metric-based organisation, has a project approach which provides us with milestone-based measurement, integrates well with our other initiatives such as ISO and CMMI and is measurable (issues, problems, progress, benefits etc), not open ended.