Management Diary The Quintessential Survival Guide in the Corporate Quagmire!

The 6 Steps to Six Sigma


Step 1

Get the proper level of Six Sigma expertise at the executive level of the company. If the top leaders don't understand the advanced six sigma principles, the company has no shot to attain total quality. This will probably require a hefty budget, entailing the hiring of several high-priced consultants for long periods of time. The consultants need to observe and gather data about the companies operations, and show the executives how to interpret the data.

Step 2

Get the staff involved. The ones in the trenches are the most knowledgeable about the day-to-day operations, and the day to day's are where most costs are spent. This means getting people like the shop foreman, the line supervisor, and the office manager involved in the training. Not only do they need to understand the thinking behind six sigma, but they also need to buy into the benefits. Since they're the ones carrying out the orders and directing the vast majority of employees, if the trench-level staff isn't aligned with management, the company is sunk.

Step 3

Measure the data - quantify the number of defects per unit. This applies not only to manufacturing, but to services as well. It's easier to measure defects on an assembly line. You just divide the number of defective units by total output (that's really simplified, but you get the point). Services are more vague.

This is why it is vital to get input from your customers. Ask them how things are going from their perspective. Is there anything they would like to see you improve on that would make their experience more favorable? You're looking to increase overall quality. Nobody knows your faults better than your customers.

Everything must be measured and quantified into actual numerical data. How long does it take the average customer order to ship? What percentage of customers is satisfied with your performance? What is the average employee break time? How long does it take the customer service department to answer the phone? Once enough data is gathered to answer questions like these, the six sigma process and the path to quality improvement can begin.

Step 4

Now you must analyze all of the data that has been collected so far and identify the difference between perfection and your current operating efficiency level. The goal is to constantly close the gap between the two. Again, as stated in Step 2, staff buy-in is extremely important. If management does not show a link between "total quality improvement" and "workplace improvement," then all the data collection will go to waste. The staff will not willingly take the extra steps (which often require harder, more detailed work) if they are not being rewarded. Some companies use bonuses to provide incentive, other companies offer prizes for attaining goals or add employee perks based on improvement levels.

Step 5

Now is the time for improvement. Changes in procedure and operations should have been in place, and more data should be collected to gauge the level of overall quality improvement. Either the hired consultants or an internal team of Six Sigma Black Belts should supervise the data collection. Again, this step will be expensive. Gathering the vast amount of data needed to accurately assess performance takes a great deal of time, resources, and capital. But without proper data and measurement, you will never know if the changes are working or not.

Step 6

After improvement begins, the constant chore of ongoing control must be monitored. Unforeseen variables will arise. Employees may turn over, competitors might introduce new products, your facility may undergo changes, and many other things could happen which will impact the overall quality of your business. Top level Black Belts need to be constantly analyzing data to gauge the impact of any future changes, spot possible trends, and formulate actions to keep on the path of consistent and eternal improvement.

If you're truely interested in the Principles of Six Sigma, take a look at all the news, articles, and education provided at Six Sigma Principles


MORE RESOURCES:

A look at economic developments around the globe (AP)
AP - A look at economic developments and activity in major stock markets around the world Friday:
NY's AG isn't backing down from Wall Street probe (AP)

FILE- In this March 18, 2011 file photo, New York Attorney General Eric Schneiderman answers a a question during a news conference in his New York City office. Although shrugging off the “sheriff of Wall Street” title, Schneiderman stood firm against major banks when he rejected a settlement over the mortgage collapse a year ago, because it shielded them from future investigations (AP Photo)AP - New York Attorney General Eric Schneiderman, a lead investigator into the mortgage collapse that wobbled the U.S. economy, hasn't taken the title "Sheriff of Wall Street" that one of his predecessors rode all the way to the governor's mansion.



Summary Box: Commodities fall on Greece debt woes (AP)
AP - GREEK WOES: Commodity prices fell broadly as a plan to fix Greece's crippling debt crisis remained far from settled, renewing concerns about global economic growth.
Most commodity prices fall on Greece debt woes (AP)
AP - Commodity prices fell broadly Friday after a plan to fix Greece's crippling debt crisis suffered a setback, renewing concerns about global economic growth.
Bernanke urges action to heal housing markets (Reuters)
Reuters - Federal Reserve Chairman Ben Bernanke on Friday issued a call to action to restore U.S. housing markets, saying depressed house prices and sales are a serious drag on the economic recovery.
Obama call for manufacturing revival a tough goal (AP)
AP - President Barack Obama is making a strong election-year push for an economic revival "built on American manufacturing." But he faces an uphill slog, with little consensus even within his own party on how to do it.
Gov't on pace for $1T deficit despite January dip (AP)
AP - The federal deficit was lower through the first four months of the budget year than the same period last year. Still, the deficit is expected to top $1 trillion for the fourth year in a row, putting more pressure on Congress and President Barack Obama in an election year.
Bernanke: Weak housing has hurt consumer spending (AP)

U.S. Federal Reserve Chairman Ben Bernanke speaks about housing markets in transition at the International Builders' Show organized by the National Association of Homebuilders in Orlando, Florida February 10, 2012. REUTERS/David Manning (UNITED STATES - Tags: BUSINESS POLITICS REAL ESTATE)AP - Ben Bernanke says declines in home prices have forced many Americans to cut back sharply on spending and warns that the trend could continue to weigh on the economy for years.



January budget gap shrinks (Reuters)
Reuters - The monthly budget deficit narrowed to $27.4 billion in January from $49.8 billion in the same month a year earlier, partly because some benefit payments normally made in January were shifted to December, the Treasury Department said on Friday.
Anxiety over incomes hits consumer morale (Reuters)
Reuters - Americans felt worse about their personal finances in early February, but rising confidence in the labor market's prospects should help to support spending and the broader economy.
Romney appeals to U.S. business with harsh China talk (Reuters)
Reuters - Mitt Romney slammed China's "autocratic model" of capitalism in a speech to technology executives on Friday, keeping up attacks on the economic powerhouse days before a visit from a Chinese official expected to be the country's next leader.
Housing a "significant headwind" to recovery: Fed's Pianalto (Reuters)
Reuters - The housing market is holding back the broader economic recovery now that foreclosures have become "a national crisis," a top Federal Reserve official said on Friday.
Exclusive: Future of bank benchmark rate under review (Reuters)
Reuters - A global probe into whether banks colluded to set the interest rates at which they borrow money from each other has thrown into question the future of the benchmark they use to price financial products worth an estimated $360 trillion.
Bernanke urges action to heal U.S. housing markets (Reuters)

U.S. Federal Reserve Chairman Ben Bernanke speaks about housing markets in transition at the International Builders' Show organized by the National Association of Homebuilders in Orlando, Florida February 10, 2012. REUTERS/David Manning (UNITED STATES - Tags: BUSINESS POLITICS REAL ESTATE)Reuters - Federal Reserve Chairman Ben Bernanke on Friday issued a call to action to restore U.S. housing markets, saying depressed house prices and sales are a serious drag on the economic recovery.



Spain cuts firing costs in new labor reform (Reuters)
Reuters - Spain cut severance pay for workers on Friday and watered down collective bargaining rights, giving more power to employers as it attempts to kick start its moribund jobs market and slash Europe's highest unemployment rate.
Portugal watches Greek debt drama with foreboding (Reuters)
Reuters - Portugal's economy will shrink as much as Greece's this year, according to IMF projections. The two will have identical current account deficits and the red ink in Portugal's budget will be almost as deep as in Greece's.
Trade deficit widens to $48.8 billion in December (AP)

In this photo of Feb. 4, 2012, a cargo ship, owned by German shipping company Hapag-Lloyd, crosses New York Harbor. The U.S. trade deficit widened in December, reflecting a jump in imports of autos and industrial machinery. For the year, the deficit climbed to the highest level since 2008 as both exports and imports rose to all-time highs.  (AP Photo/Mark Lennihan)AP - Monthly U.S. exports to Europe grew in December, a hopeful sign after a steep decline the previous month. But, some economists remain concerned that the region's debt crisis will still weigh on the U.S. economy this year.



U.S. jobless rate projected to fall sharply (Reuters)
Reuters - Economists in a survey see the unemployment rate falling much faster this year than previously expected, an improvement in the jobs market that could help President Obama's re-election chances.
Consumer mood worsens in February on income worries (Reuters)
Reuters - Americans felt worse about their personal finances in early February, even as they saw a light at the end of the tunnel for the jobs market, a survey released on Friday showed.
Instant View: Consumer mood worsens in early February (Reuters)
Reuters - Americans turned less optimistic about the economy in early February on worries about falling income even as their outlook on the jobs market rose to a record high, a survey released on Friday showed.
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