What is Six Sigma?

Six Sigma is an approach to data-driven management that seeks to improve quality by measuring how many defects there are in a process and systematically eliminating them until there are as close to zero defects as possible. In 1984, a Motorola engineer named Bill Smith developed the Six Sigma management system to reduce the variations in Motorola’s electronic manufacturing processes that were causing product defects. Since then, the strategies, tools and cultural norms that support the management system have been adopted by companies in a wide variety of industries and the meaning of the word “defect” has broadened to include any deficiency that prevents a company from meeting its customer’s needs.
Six Sigma proponents claim its benefits include up to 50% process cost reduction, cycle-time improvement, less waste of materials, a better understanding of customer requirements, increased customer satisfaction, and more reliable products and services. Motorola hold the federal trademark for Six Sigma and it is generally acknowledged that Six Sigma can be costly to implement and can take several years before a company begins to see bottom-line results. In 1995, General Electric Chief Executive Officer (CEO) Jack Welch’s very public endorsement of Six Sigma helped businesses outside of manufacturing understand how Six Sigma methodologies can be used to improve customer satisfaction in any industry.

The Five Steps of Six Sigma
True believers and practitioners in the Six Sigma method follow an approach called DMAIC which stands for define, measure, analyze, improve and control. It is a statistically driven methodology that companies implement as a mental framework for business process improvement. The ideology behind DMAIC is that a business may solve any seemingly unsolvable problem by following the DMAIC steps.

A team of people, led by a Six Sigma champion, defines a faulty process on which to focus, decided through an analysis of company goals and requirements. This definition outlines the problem, goals and deliverables for the project.
The team measures the initial performance of the process. These statistical measures make up a list of potential inputs which may cause the problem and help the team understand the process’s benchmark performance.
Then the team analyzes the process by isolating each input, or potential reason for the failure, and testing it as the root of the problem. Through analysis, the team identifies the reason for process error.
From there, the team works to improve system performance.
Finally, the team adds controls to the process to ensure it does not regress and become ineffective once again.
Lean Six Sigma is a team-focused managerial approach that seeks to improve performance by eliminating waste and defects. It combines Six Sigma methods and tools and the lean manufacturing/lean enterprise philosophy, striving to reduce waste of physical resources, time, effort and talent while assuring quality in production and organizational processes. Under the tenets of Lean Six Sigma, any use of resources that does not create value for the end customer is considered a waste and should be eliminated.

There are two very important methodologies for executing a Six Sigma initiative:
Six Sigma DMAIC and Six Sigma DMADV. Each term’s name is derived from the major steps in its process, but each has its own use.
DMAIC (define, measure, analyze, improve, control) is used to correct a process that already exists. DMADV (define, measure, analyze, design, validate) is used to create a new process.

Six Sigma DMAIC
Here is a step-by-step breakdown of Six Sigma DMAIC:

1) Define: Identify the project goals and all customer deliverables.
The main objective of this phase is to summarize the project plan. This phase focuses on clearly specifying the problems; the goals of the process improvement project what is the scope of the project and identifying the customers (internal and external) along with their requirements. An input to this phase comes from the voice of customer (VOC), the voice of business (VOB) and/ or the voice of process (VOP). In addition, sometimes the voice of employees (VOE) is also effective to lead some six sigma improvement projects. With the help of these inputs, six sigma projects are identified. In this phase, we identify opportunity for six sigma projects. We develop a project plan and high-level process map. The main component of this phase is preparing Project Charter. Charter is a document, which is an initial blueprint for any six sigma project. It outlines following essential elements:

Business Case: It helps to understand how the project is linked to the overall business objectives.

Problem Statement: describes the problem or issue, this project is intended for.

Goal Statement: defines the project goal by considering all elements of SMART. The acronym stands for Specific, Measurable, Attainable, Relevant & Time-bound.

Project Scope: This considers in and out for this project. It defines the project boundary.

Team & their broad responsibilities: Project team description along with their responsibilities and roles during the project.

Time plan: Also, known as milestones. It ensures to keep a track on project progress as scheduled.

Estimated project benefits: Project benefits need to be estimated as a deliverable. Cost-benefit analysis is conducted & benefits, both tangible & intangible are speculated. This gives a direction to top management, whether to approve the project.

Charter is duly signed & approved by top management. Thus, gives a signal to go ahead for outlines project from Top executive. Tools in Define phase are required to measure CTQ (Critical to Quality) characteristics. The Pareto Chart and SIPOC (Suppliers, Inputs, Process, Outputs, Customers) are the valuable tools of this phase.

2) Measure: Understand current performance.
The main objective of this phase is to collect the data that is relevant to the scope of the project. This phase focuses on identifying the parameters that need to be quantified, ways to measure them, collect necessary data and carry out measurement by different techniques.

The operational definition of metric is devised. It gives common language & understanding of data being collected. Data Collection plan outlines what data to be collected? When to be collected? Who will collect? Hence, sets overall direction for data collection. After data collection, data is analyzed to ascertain its nature through frequency distributions. The histogram can be used to understand the distribution of data. Depending upon data nature – Normal or Non – Normal, data – analysis tools are decided. Current Process capability is also an important aspect to be understood in this phase.

In Measure phase, different tools can be used like Process flowcharts, Benchmarking, Run charts, Gage R & R and Process capability.Two commonly used measurement techniques are – Defects Per Million Opportunities (DPMO) and Process Sigma.

3) Analyze: Determine root causes of any defects.
The main objective of this phase is to find the root cause of business inefficiency. It identifies the gaps between actual and goal performance, determine its causes and opportunities for its improvement.

Analyze phase follows a drill down approach to reach exact root causes from various potential causes identified initially. This phase starts with exploring all possible causes to the main problem. Then, these causes are verified & validated though hypothesis & statistical tools. The outcome of this phase is verified root causes – which need to be acted upon to improve the process. Analyze phase requires due care to identify & verify root causes. Because the effectiveness of process improvement through six sigma project lies on the correct identification of root causes.

Commonly used tools in Analyze phase are Fishbone Diagram, Brainstorming, Histogram, 5 Whys, Hypothesis testing, Time series plots and Scatterplot.

4) Improve: Establish ways to eliminate defects and correct the process.
This phase improves the process by determining potential solutions, ways to implement them, test and implement them for improvement. In this phase, process owners are consulted and improvements are suggested. Action plan for the improvement is circulated to relevant stakeholders. This action plan specifies – Action to be taken; By when By whom etc. The improvement plan is designed to mitigate the risk and include customer feedback and satisfaction. With the formation of improvement action plan, implementation phase starts simultaneously. During implementation, actions are carried out, tested for effectiveness and implemented finally.

Tools used to eliminate the defects are Brainstorming, Mistake-proofing (Poka Yoke), Simulation software, Prototyping, Piloting and Pugh Matrix.

5) Control: Manage future process performance.
The main objective of this phase is to generate a detailed solution monitoring plan. This plan ensures that the required performance is maintained. It defines and validates the monitoring system, develops standards and procedures, verifies benefits and profit growths, and communicates to business. Hence, the main purpose of Control phase is to ensure – Holding the gains.

During this phase, post-implementation results are evaluated. Progress is ascertained. And Changes are incorporated – if any, correction or modification is required. Control phase in most of the cases is a transition phase. Transition happens from current practices & systems into new practices.

The most important part of this phase is to provide training on new changes to all relevant stakeholders.

Important tools used in control phase are Process sigma calculation, Control charts, Cost saving calculations and Control plan.

It is an integral part of Lean Six Sigma process, but can be implemented as a standalone quality improvement process. Indeed, it is the most preferred tool that can help improving the efficiency and the effectiveness of any organization. Within the DMAIC framework, Six Sigma can utilize several quality management tools.

Seven Basic Quality Tools (Quality core tools):
Below is the list of some quality management tools, popularly known as seven basic quality tools –

Cause and effect diagram or Ishikawa diagram

Flow Chart

Pareto Chart

Histogram

Check Sheet

Scatter Plot

Control Chart

These basic tools are helpful in six sigma projects at different times.

seven basic quality tools
Image Source: https://takuminotie.com/english/2016/01/02/1-3-seven-qc-tools/
Figure 2: Seven basic quality tools

Now, let’s discuss them to get better clarity and understanding:
1. Cause and Effect Diagram:
Also, known as Fishbone diagram. Attributed to Kaoru Ishikawa, the diagram has its shape similar to a fish skeleton. Hence, named as Fishbone diagram. This tool is used to explore causes to a single effect (or event) through brainstorming. These causes are put under different common categories known as 5 M or 6 M. Where, 6 M expands as – Man, Material, Method, Machine, Measurement & Mother Nature.

2. Flow Chart:
It suggests the process flow in a diagrammatic way. Outlines a pictorial representation of processes or process steps to understand their flow upstream or downstream.

3. Pareto Chart:
Also, known as 80:20 principle. Attributed to Vilfredo Pareto, Principle states, 80% of the outcome is a result of 20% causes. It’s a kind of bar chart showing the frequencies of different causes or factors in descending order. The main purpose of this chart is to highlight the most significant factors among a number of factors.

4. Histogram:
It’s a bar chart to study the frequency distribution of data set. It’s used to understand nature of data.

5. Checksheet:
It is used for data collection. A frequency of factorized data is collected in check sheet.

6. Scatter Plot:
Scatter plot represents the relationship between two variables. It shows, how one variable changes with respect to any change in another variable. Scatter plot can depict following relationships:

Strong positive

Strong negative

Weak Positive

Weak Negative

Any trend (Parabolic)

No relation

7. Control Chart:
These charts are used to check, whether process data remains under control for the shorter time span. They involve process control limits and sometimes customer specification limits as operational ranges or bands. Process data is analyzed to remain within process control limits. Whenever data goes out of control limits, it certainly has some special causes – to be investigated & removed immediately. The aim of these charts is to ensure process data doesn’t go beyond control limits. However, some exception rules are also there to ascertain the condition of a process going out of control, while well within control limits.

Six Sigma – A top-down approach:
Six Sigma needs a drive & support from top management to realize its full potential. Hence, it’s a top-down approach. Top management commitment is a key to success of Six Sigma projects. Six Sigma Master Black belts or Black belts should seek for the best possible management support to bring successful six sigma improvements. Apart from top management, commitment from all stakeholders and employees lead to exceptional outcomes. In the organizations, where six sigma is a part of organizational culture, excellence is pursued in each work area. Six Sigma approach is highly driven by the culture & values of the organization. The pursuit of continuous improvement & being excellent is an obvious buy- into six sigma applications.

Final Takeaway:
Six Sigma DMAIC methodology has been internationally accepted and can be implemented in small-size to high-profile firms. Six Sigma is highly structured & logical methodology. The structure followed passes through five important phases – DMAIC. The output from one phase is treated as input to next phase. And in the end, results are obtained as per expectations. All these five phases- define, measure, analyze, improve & control – form a circular chain of continuous improvement. Six Sigma is a quest – a journey for improvement doesn’t end by reaching one milestone. This process improvement tool can be used incessantly to realize continuous improvement. Hence, leading to excellence.