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Six Sigma Explained

Six SigmaThe Six Sigma business philosophy and methodology was created by the Motorola Corporation in the mid-1980s. Motorola in partnership with other companies, including Kodak and IBM, then developed the methodology further. It was popularized in no small part by the former GE CEO, Jack Welch's commitment to using it within the General Electric Corporation.

The Six Sigma philosophy is to focus on continuous improvement by understanding customer requirements, analyzing business processes and measuring process performance.

The aim of the methodology is to reduce variation in process performance. Reducing variation in a process results in less waste and rework, better predictability of resource requirements and products and services that perform better and last longer. All these lower cost and result in happier customers.

Sigma is a statistical concept that measures the amount of variation that occurs in a process. The closer to Six Sigma a process gets the less variation occurs. At a sigma level of 6 a process is said to be 99.9997% free of defects. Few businesses require this level of quality and most aim for a sigma score of around 4 to 5 depending on their customer needs.

Six Sigma uses two methodologies. The better known of the two methodologies is DMAIC. DMAIC is used to improve the capability of existing processes. The name is an acronym of the steps involved in the methodology.

  1. Define: define the project's purpose and scope. Collect information on customer needs and the process
  2. Measure: measure current process performance and customer satisfaction
  3. Analyze: Analyze data to identify the root cause of defects
  4. Improve: improve the process by testing solutions to address root cause and use data to prove the results
  5. Control: control the process and maintain the improvement by recording lessons learned, standardizing the process and measuring ongoing performance.

The other Six Sigma methodology is DMADV. This methodology is used to create new processes, products and services to meet customer requirements or to redesign existing processes which consistently fail to meet customer needs. The steps in this methodology are Define, Measure, Analyze, Design and Verify.

Some Six Sigma concepts and tools are the same as those used by other continuous improvement methodologies. Six Sigma differs from these in its emphasis on a focus on quality as defined by the customer and more rigorous statistical methods and measurement.

The methodology provides a measurable way to track performance based on verifiable empirical data, improves customer relationships by addressing and reducing defects and improves the effectiveness and efficiency of business processes by aligning them to customer needs.

To successfully implement Six Sigma in an organization a business must create an environment that supports its use. This means management must lead improvement efforts, the business culture must have as a priority delighting its customers and everyone must be encouraged to openly discuss defects.

Many organizations have produced dramatic improvement in results as an outcome of using the Six Sigma DMAIC methodology. It provides a framework, checklist and common language for business improvement. Six Sigma even allows you to improve the way you improve.

 

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