The following BPM tool guide is one of a series produced for ICAEW by Professor Mike Bourne of Cranfield University.
“Six Sigma” was registered by Motorola as a Service Mark in 1991. Six Sigma is an approach to managing quality in organisations based on statistical techniques. The “sigma” refers to the number of standard deviations from the mean, so a process that is capable of delivering Six Sigma has an error or defect rate of 3.4 per million or less. To do this you have to be able to consistently operate your process flawlessly.
Six Sigma has its background in Motorola in the mid-1980s and was made a core element for managing General Electric (GE) in the 1990s. Some would claim that the approach is close to TQM (Total Quality Management) but Six Sigma has its own vocabulary, and sometimes this needs to be translated.
Here I will talk about the basic concepts, describe the main two methodologies and present the qualifications that are regularly talked about in this field.
At GE, there are six key concepts that underpin their Six Sigma approach:
- Critical to quality – these are the factors that are most important to your customer.
- Defects – these are the occasions when you deliver outside the customer’s specification so the customer doesn’t get what they specifically required.
- Process capability – this is the measure of what your process is capable of delivering in terms of quality performance.
- Variation – All processes have variation, even Six Sigma processes, the key is to continually measure and manage that variation appropriately for the benefit of the customer.
- Stable operations – this is about operating your processes consistently in a highly predictable manner but also about continuously improving what you customer receives and experiences.
- Design for Six Sigma – this is designing a process that has the capability of delivering the customer’s needs.
There are two methodologies at the heart of Six Sigma – DMAIC and DMAVD. I will discuss DMAIC first and DMAVD later.
DMAIC stands for Define, Measure, Analyse, Improve and Control. I will present these in a little more detail next in the form of questions.
- What is the objective to be achieved?
- Who will sponsor the project?
- Who will lead the project?
- Who will be engaged and form the team, who will cover their absence from the day job?
- Who will support the project from the operation being improved?
- What does the current process look like? (Value stream map the process).
- What performance is being achieved?
- What are the sources of waste?
- What are the bottlenecks in the process?
- What are the root causes of underperformance?
- What can be improved?
- How can this be improved?
- How is the change to be implemented?
- What training / education is required to implement the change?
- What have we learnt from testing the new process?
- What fine tuning is required?
- What new levels of performance are being achieved?
- Are these sustainable in the longer term?
- What new operating procedures are required?
- Are the new operating procedures understandable and fit for purpose?
- What has been achieved? (Celebrate!)
DMADV (or sometimes called design for Six Sigma) stands for Define, Measure, Analyse, Define and Verify. Taking each of these in turn:
- Define – this is about stating the problem - what is to be achieved. Attention should be paid to the customer requirements and outline targets and goals.
- Measure – this is about identify the factors that are “Critical to Quality” and how they are going to be measured.
- Analyse – this is about identifying how the process is going to achieve the goals set. This will require creating an understanding of how the inputs will affect the process and how the process will affect the outcome.
- Design – this is about working out the optimum design for the new process and may involve using simulations, experiments or models to test the design of the new process before it is implemented.
- Verify – this is the running of trials or pilot processes to verify that the process designed will be capable of delivering the required performance on the Critical to Quality elements required by the customer. You will also need to verify that the process is actually implemented as it was originally designed.
Those that practice Six Sigma have developed their own series of qualifications based on Belts
Yellow belt – typically a one day introduction programme to understand the key concepts. This programme is often used for general education to the subject in an organisation rather than the first rung on the ladder.
Green Belt – typically a week long training programme combined with a Green Belt project that demonstrate that the participants have understood the content and can apply in it practice.
Black Belt – this is a much longer period of training and practice that is designed for those who are going to be leading performance improvement projects in an organisation. The Black belt is awarded based on either the demonstration of competence through delivering projects across a prescribed range competences (as per Unipart’s Black Belt programme) or in some cases delivering a specific value of savings through implementing performance improvement. Black Belts are expected to spend 100% of their time on performance improvement projects.
Master Black Belt – are tasked with maintaining the quality of the Six Sigma approach and the competence of those involved in Six Sigma across an organisation. They are often seen as the organisations “faculty” for the subject.
Benefits of Six Sigma
Taking a Six Sigma approach puts a real emphasis on quality and process capability within an organisation.
Designing a process to meet the requirements of the customer is a really sensible approach.
Doing this well isn’t easy, but if you can master it, you should outperform most of your competitors.
Pitfalls to be avoided
Six Sigma often starts in manufacturing or operations but is widely applicable across the whole business. Rolling it across the whole business is a significant task, but if Six Sigma is confined to certain functions, management’s understanding will be limited. This will hold back the benefits that can be achieved and will ultimately undermine the long term survival of the approach.
Six Sigma invariably focuses on incremental performance improvement. Sometimes you will want to make a step change in performance and Six Sigma doesn’t always lend itself to doing that.
To get Six Sigma to really work, the organisation has to dedicate resources and build a sustainable Six Sigma capability as is being suggested by the new ISO standard. Be aware of the level of commitment this requires. Six Sigma looks like a “silver bullet” but it requires the investment of time, effort and resource to develop the capability.
Michael George &, David Rowland, Mark Price & John Maxey, (2005), Lean Six Sigma Pocket Tool Book, McGraw-Hill.