Data can only be as good as the individuals who analyze it. Six Sigma allows organizations to not just study data, but to use it to eliminate any defects found in their business processes. This is not a “feel good” methodology, but one very much based in science. For any process to achieve Six Sigma, it must not produce a defect (anything less than a customer’s specifications and expectations) more often than 3.4 times per million opportunities.
Six Sigma is actually implemented through the use of two methodologies; DMAIC which stands for Define, Measure, Analyze, Improve and Control and is used for existing processes, and DMADV which is used for new processes and stands for Define, Measure, Analyze, Design and Verify and is used for developing new processes.
Organizations that embrace Six Sigma will reap a number of benefits. However there are six key advantages that these methodologies offer.
1. Improved Customer Retention
All businesses want to attract new customers as well as retain the ones they already have. Customer loyalty and retention are directly related to customer satisfaction. Those customers that choose to take their business elsewhere do so because they are either dissatisfied with a company’s offerings, their employees, or both.
Implementing Six Sigma reduces the risk of customer dissatisfaction by analyzing data that pinpoints which product or service attributes are critical to the customer’s perception of satisfaction. Adjustments can then be made.
2. Better Time Management
Six Sigma can also help team members manage time more effectively, which results in more efficient business processes. Employees set SMART goals (focusing on the areas of learning, fulfillment and performance) and then apply the data principles of Six Sigma to their goals.
3. Shorter Cycle Times
Changes in project scope often lead to team members scrambling and deadlines being pushed. By implementing Six Sigma, a business can create a “watchdog” team made up of experienced employees who identify factors that have the potential to negatively affect the project, requiring longer cycle times. With Six Sigma, the team can go beyond simply identifying possible problems and actually develop solutions, thereby allowing shorter cycle times and deadlines to be met.
4. More Motivated Employees
In order to be successful, every business requires a team of employees that act with the organization’s best interests in mind. There must be sufficient motivation for this to happen. When a company shares Six Sigma’s power solving tools and techniques with employees, those employees are empowered, trusted, and then motivated to perform at their optimal best.
5. Strategy Development
Business objectives cannot be reached without strategies being developed and launched. Six Sigma plays an integral role in the development of any strategy because after an organization has created a mission statement and done a comprehensive SWOT analysis, Six Sigma can assist in focusing on areas for improvement.
For instance, if the business objective is to be a cost leader in the market, Six Sigma can improve internal processes, increase yields, eliminate waste and gain or maintain lowest cost supplier agreements. No matter what a business’ objective is, Six Sigma can help make it the best at what it does.
6. A Stronger Supply Chain
Suppliers have a major influence on whether a company has a defect ratio of less than 3.4 per million. Six Sigma can reduce the risk of defects by potentially decreasing the number of suppliers or supply points in the chain. For the least amount of defects, executives should drive Six Sigma improvements as far up the supply chain as possible.
Whether their aim is to improve production, customer service or resource management, the methodologies of Six Sigma can assist all organizations in identifying critical operation flaws and develop improved business practices.
