Digital transformation is one of the hottest buzzwords in the world. With the advancement of technology, companies have started to use several new tools and software to scale their businesses and thrive in this fast-paced, competitive environment. However, merely hopping on these recent trends is still not enough to gain a foothold and succeed in this scenario. Along with cutting-edge technology, you also need a team of experts who can fuel the process with streamlined methods, quality control, and business transformation.
Leading organizations have been aware of this need for decades. A scientist working at Motorola during the 1980s developed a new concept called Six Sigma. Over the years, this concept has been polished and converted into something more useful as per the current environment.
In this article, we’ll be discussing Six Sigma and breaking it down into the following topics:
- The five fundamental principles of Six Sigma.
- The Six Sigma methodology.
- The Six Sigma process of business transformation
What is Six Sigma?
In simple words, six sigma is a set of management tools and techniques created for refining businesses by lowering down the likelihood of error. It’s a data-driven approach that leverages statistical methods for eliminating errors and defects.
The 5 Key Principles of Six Sigma
The concept of six sigma has a simple objective—produce near-perfect products and services for transforming businesses to achieve optimal customer satisfaction.
This goal is achieved through a simple, two-pronged approach:
- Identify the problem.
- Solve the problem.
Now, the five fundamental principles of six sigma include:
Focus on the Customer
The first and foremost goal of the Six Sigma process is to focus on the customer’s needs and provide them with maximum benefits. In order to achieve this, businesses need to understand the needs, desires, and pain points of their customers. This requires establishing the standards of product quality as defined by what the customer segment or market demands.
Measure the Value Stream
Determine the steps in a specific process to identify the areas of waste. Collect the data to understand particular problem areas that must be addressed and improved. Have defined goals for data collection, a clear reason for collecting the data, expected insights, ensure the accuracy of metrics, and set up a standard system for data collection.
Remove the Junk
Once you’re done finding the problem, modify the process to reduce variation and remove the error. Eliminate the activities in the process that don’t add value to the customers. If you aren’t able to identify the problem, use tools to identify outliers and problem areas. Now streamline the system to achieve quality control and efficiency.
Keep the Ball Rolling
In the process, involve all relevant stakeholders. Create a process that allows your team members to combine their varied expertise to provide the fastest and most accurate solutions.
Ensure a Flexible and Responsive Ecosystem
When you remove a faulty step in a process, it changes the work practice and employee approach. A robust culture of flexibility and responsiveness to modifications in the process can help streamline project implementation. The stakeholders or team members involved in the process should be able to adapt to the changes instantly with ease, and so to facilitate this, procedures should be designed for fast and seamless adoption.
The Six Sigma Methodology
There are two essential methodologies in the Six Sigma process: DMAIC and DMADV.
DMAIC: DMAIC stands for Define, Measure, Analyze, Improve, and Control. It is a data-driven method that is used for the improvement of existing products and processes to provide better customer experiences (CX).
DMADV: DMADV is a part of the Design for Six Sigma (DFSS) process used for designing or redesigning various processes of product manufacturing or service delivery. It stands for Define, Measure, Analyze, Design, and Validate.
The Six Sigma Process for Business Transformation
Although there are multiple six sigma methodologies, DMAIC is the standard one utilized to discover deviations and solve problems when transforming a business.
Each of the five phases of business transformation in DMAIC has multiple steps:
The process starts with a customer-centric approach.
Step 1: The problem in the process is defined from a customer’s point of view.
Step 2: What do you want to achieve? Determine your goals.
Step 3: Map the process and verify with stakeholders that everything is aimed in the right direction.
The second phase is focused on the metrics and the tools used in the measurement process.
Step 1: Quantify all of the issues and back them up with supporting data.
Step 2: Define the performance indicators.
Step 3: Evaluate the measurement system.
In this phase, identify the influencing variables.
Step 1: Determine whether your process is efficient and effective or not.
Step 2: Qualify the goals using quantifiable values.
Step 3: Determine variations using historical data.
In this phase, you’ll investigate how the changes in “X” impact “Y.”
Step 1: Determine the possible reasons. Test to find which of the X variables determined in the last phase influence Y.
Step 2: Identify the relationship between the variables.
Step 3: Establish process tolerance. Process tolerance is the precise values that some variables can have and can still fall under acceptable boundaries. For example, the quality of a specific product.
This is the final phase where you check whether the performance objective identified in the last phase is well implemented and whether or not the design improvements are sustainable.
Step 1: Validate the measurement system that has to be used.
Step 2: Establish process capability.
Step 3: Once it’s all done, implement the process.
The Six Sigma process offers clear guidelines for those looking to transform their organization. Test Six Sigma methodologies in smaller scales before ramping up to business-wide initiatives. This way you and your teams can determine if it is the best way to evolve and grow.