The "Six Sigma" approach.

Is this a special sign used by some secret agents?

No, this is Six Sigma, an initiative used by some companies.

I chanced upon the "Six Sigma" approach when I was doing some reading. What does "Six Sigma" means? It is an initiative used by some companies to better their bottom line by ensuring consistency and improving standards in quality of their products and services to better meet customers' needs.

The actual "Six Sigma" approach can be complicated involving statistical calculations in the use of this initiative. However, the whole approach can be viewed in simplicity and adopted into the running of a company.

Jack Welch, an ex-CEO of General Electrics has used this Six Sigma approach in the running of General Electrics during his reign as a CEO. Basically, the whole approach can be summarised into the following steps.

1. Define the problem at hand.
2. Measure where one is at currently in the defined area of problem and also where one wants to arrive at.
3. Analyse what is the root of the problem.
4. Improve on the procedures of doing things so as to solve the problem.
5. Control the new procedures very strictly to ensure the problem is exterminated for good.

The acronyms for the steps can be easily remembered as Dumb Managers Always Ignore Customers.

As mentioned earlier, the Six Sigma approach seeks to better the bottom line of a company by ensuring consistency and improving standards in quality of their products and services to better meet customers' needs.


1. Define the problem at hand

For ease of explaining, I shall use an example of a pizza outlet based on my reading. A manager noticed that sales of pizzas has been decreasing over a period of time. He and his team proceeds to define the problems causing it. Based on gathering feedback from customers (which is very important to find out the needs of customers), they find that the pizzas are not evenly cooked and some parts were more burnt than other parts. There was also feedback that the time taken to serve the orders for pizzas was a bit slow.

With more than one problem at hand, the Six Sigma approach seeks to tackle the problem of priority. How does one define which problem is of priority over others? The problem that is of priority to tackle is the one that hurts the bottom line the most and once solved can improve the bottom line of a company the most compared to solving other problems. Thus, the manager and his team decided to focus on solving the quality issue of the pizza which is ensuring the pizza is evenly cooked. In using Six Sigma, usually the management focuses all energies and resources on solving one problem at hand each time, the problem of most priority that can show the most improvement to bottom line once solved. Once the problem of priority is solved does the company proceeds to tackle other problems of lesser priorities.


2. Measure where one is at currently in the defined area of problem and also where one wants to arrive at

After defining the problem, the company seeks to run statistical analysis to see how far the company has deviated from what they hope to achieve. For example, using the earlier illustration, how many pizzas out of the total pizzas produced daily that failed to meet the expectations of an evenly cooked pizzas. From churning out some statistical calculations (which is too complicated beyond what can be explained by a layperson like me), the company can know where it stands currently in terms of performance. The more deviation from the expected standards, the lower the sigma is awarded for the company. Sigma represents amount of variance from a set standard. A low score on sigma (e.g. one sigma) represents that there is too much variance from the desired standard. The ideal case is a full Six Sigma that represents almost no variance from a desired standard. In the case of the pizzas, it means almost all pizzas are evenly cooked according to required standard and only negligible number of pizzas failed the standard.



3. Analyse what is the root of the problem

After measuring the amount of variance from a desired standard, the manager and his team proceeds to analyse carefully what has gone wrong that caused their pizzas to be unevenly cooked. They finally zoom in to the root of the problem, an issue with the pizza baking machine and procedure of handling the pizzas. They have been using kitchen helpers to help to move and flip pizzas through a large pizza baking machine. Although the time intervals to move and flip pizzas are under a strict protocol whereby kitchen helpers have to stick strictly to the time intervals to manage the movement and flipping of pizzas in the pizza baking machine, there are still occasional times when kitchen helpers missed the timings and so pizzas do not get evenly cooked. This method of baking the pizzas introduces possibility of uneven baking and is not ideal.

After anaylsing what is the root of the problem, the team then proceeds to anaylse what is a way of solving this problem. They came out with the idea of using a conveyor belt system to move the pizzas through the pizza baking machine. By using such a system, the movement of pizzas through the pizza baking machine can be controlled with regularity and precision. This system ensures an improvement in the baking of pizzas to ensure each pizza is evenly cooked.



4. Improve on the procedures of doing things so as to solve the problem  

After analysing and finding a solution to the problem, the team then proceeds to implement the solution which is purchasing and installing the conveyor belt system into it's pizza baking machine. Sometimes, there may be more than one ideal solutions to the root of problem. The company then adopts the best solution, one that proves to have the least cost ensuring most savings, and best results to the bottom line of the company. It may not always be the case of cost savings when choosing a solution to take. Sometimes, as long as there is a boost to the bottom line, a fair amount of resources is used to install the needed solution to tackle the problem.


5. Control the new procedures very strictly to ensure the problem is exterminated for good


After installing the solution to the identified problem, strict control procedures are implemented to ensure that the same problem has no chance of surfacing again. For the pizza baking machine case, it may mean having an extra reserve pizza baking machine with conveyor belt system that will replace the existing conveyor belt system immediately should any faults occur anytime. Afterall, if the most important problem has been solved providing the greatest improvement to bottom line, the company should ensure the most important problem does not surface again anymore to hurt the bottom line.



People Process in running Six Sigma

To ensure the Six Sigma approach can be of practical use instead of just another one of many airy-fairy initiatives companies take that is more of show than practical use, the Six Sigma project has to be run specifically by a dedicated group of important personels in the company. These personels are carefully selected as their focus and effort with be solely on running the Six Sigma project since what can be more important to a company than  it's bottom line.

The selected personels involve people from the top management all the way to the bottom staff. The whole company must be in concerted effort in running the Six Sigma initiative so that the initiative is well supported from the top management all the way to bottom staff. Personels running this intiative have to be carefully selected and these are people usually all-rounders who have both management skills and technical skills. In running the Six Sigma project, it must be well-supported by resources, and understanding and support from top management that once each Six Sigma project is completed, the company will see improvement to it's bottom line. By doing so, this ensures each Six Sigma project once embarked upon can be fully completed and not halted half-way, since it is a time and resource consuming process.


Conclusion

I was amazed when I read that there is such an initiative around that works relentlessly projects after projects, each time to keep focusing on improving the bottom line of a company. I am thinking that such an approach may have some learning points in applying into the life of an individual to keep improving how an individual works.