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This past decade has changed the way businesses work. Forget monopoly now. It is hard to find it anymore in any industry. Today, sector specific competition is at its peak and a decade hence, only those businesses will thrive, which seek to achieve not just profit, but also efficiency and effectiveness in the way they generate those profits. And this is precisely where Six Sigma and Lean Six Sigma come into play.
What is Six Sigma?
While Six Sigma might come off as a new concept to most, it has its origin in the 1980s. The term was first coined by Motorola company. In order to sustain in the business where its Japanese counterparts were giving it tough competition, Six Sigma tools came to its rescue.
Six Sigma tools focus on making operations of any industry more efficient. It sees to it that the businesses achieve maximum profits and customer satisfaction at a minimum cost. It is that quality goal, in which the number of defects in a product or a service are significantly reduced to 3.4 defects per million opportunities or 0.0003%. Sigma gets its meaning from statistical studies, which means standard deviation.
When Motorola was able to survive tough competition by using Six Sigma, it adopted this quality goals across all its departments. Soon, many companies started using and adopting Six Sigma to achieve quality goal. Today, Six Sigma has become ‘a must’ for any industry.
What is Lean Six Sigma?
Lean Six Sigma is relatively a new concept. At first, one might get confused on hearing these two terms – Six Sigma and Lean Six Sigma, and believe that these terms are interchangeable.
On a closer look, both these methodologies are different. Lean Six Sigma is a combination of two different theories, i.e., Lean Management and Six Sigma. Let us look at what Lean Six Sigma is and how it is different from Six Sigma.
Lean Six Sigma is a management tool that focuses on eliminating waste in an industry. On the other hand, Six Sigma is that management tool that helps in eliminating errors and defects in a product or a service.
In other words, Lean Six Sigma streamlines operations of an industry or a business, whereas Six Sigma focuses on the quality of a product or a service that a particular business delivers. Both these six sigma tools were first utilized in manufacturing sectors.
Lean Six Sigma involves identifying steps in operations of a business and constantly improving and eliminating those steps that do not add any value to the business. This is done using available data.
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The DMAIC Methodology
When you realise that there may be problems and defects in operations, you should know it’s time for Lean Six Sigma. The question is, how do you identify these defects and how do you rectify them? The DMAIC model or six sigma tools is our saviour here.
DMAIC is short for a five-phase cycle, that is, Define, Measure, Analyse, Improve and Control. All these are used throughout the project to analyse changes, defects and deviations with the help of relevant data and come up with resolution techniques. Here’s what DMAIC means:
Define goals of an organisation and its customer requirements. Move on to the next step to understand and analyse what can be done to achieve them. Define also means pointing out areas or zones that are or may face problems and that may need improvement.
Measure the problem. Quantifying is the easiest way to showcase the magnitude of any issue. Preparing process maps and flowcharts will give a very clear picture and by just skimming through the figures, top management is better placed to take further course of action.
Analyse the root cause. It is important to go deep into a problem to avoid recurrence, and analysing the core issue helps in getting rid of them permanently. Various tools used at this stage go deeper into the cause of any glitches and therefore, Analyse becomes the most important stage of DMAIC model.
Improvement is understanding the root cause of a problem and asking questions like ‘why did this ever occur in the first place?’ It involves developing new methods that need to replace the antiquated so that everything falls into place.
Controlling means taking stringent measures so that the history doesn’t repeat itself. This is a continuous process and you need to keep track to deliver your best.
Now you must wonder, ‘how do I achieve these 5 phases?’
The answer lies in tools that can be used to achieve Lean Six Sigma, and they are right at your disposal. The DMAIC model acts as a base. Each step can be achieved by using specific six sigma tools specifically developed to win that stage.
Let us now look at some of these Lean Six Sigma Tools one by one:
Six Sigma Tools for DEFINE Phase
#1. Affinity Diagram
Also known as the KJ method, Affinity Diagram is an analytical tool where different ideas from different people working in that industry, relating to a specific problem, are combined and then classified according to their relationship.
This tool is very beneficial in identifying and sorting customer issues and requirements.
#2. Failure Mode and Effect Analysis (FMEA)
FMEA recognises those areas in a process that are most likely to fail and the degree of impact it may have. Past experiences and brainstorming works best to identify these areas.
#3. Process Mapping
Process Mapping or Flow Charts are pictorial representation of steps that constitute a process. This comes as a big help for new employees who are completely lost and want to understand how an organization works. It is highly beneficial and helpful to resolve communication gaps through this six sigma toolsin an industry.
#4. Value Added Flow Analysis
If you are looking for a tool that focuses on efficiency, then this is it. This tool is a combination of Value Addition Analysis, which shows all those steps that add value to a process in the eyes of a customer, and Flow Chart, which indicates time taken for all these steps. The result is a clear-cut report of unnecessary steps that consume a lot of time. All you have to do is get rid of them.
#5. Value Stream Mapping
This involves drawing a layout that captures all the activities required to be done in a process, from inception to completion. All the processes, from the moment the order is placed, to the time when it is delivered, for example, are put in a form of a flow chart with cycle time of each step and classifying steps as value addition and non-value addition.
This gives the workforce a clear direction and understanding as to how long a process takes to complete. For instance, If you say to your customer that your product takes 2 days to deliver, you can very well be assured that it is 2 days, and not 7.
#6. 7 wastes
Taiichi Ohno of Toyota has made our lives easier by identifying 7 waste areas that every business must watch out. It indicates focal points in any business where waste in terms of time and money are likely to occur. The 7 waste points are Defective Products, Overproduction, Waiting, Underutilisation of Resources, Extra Time in Processing, Transportation and Motion.
#7. Takt Time
Again a Japanese term which means clock interval. Takt Time is the pace or speed at which one must finish smaller tasks in order to finish a larger assignment. This helps in keeping track of time and boosts productivity of employees.
#8. Prioritization Matrix
This is an analytical tool that helps in figuring out which project needs utmost priority. It uses a concept called Project Priority Calculator which is a statistical or rather mathematical representation to understand which project, among all, is likely to give the best returns on investment. This means no speculations any more. You have the data and a tool to be very sure of a viable project.
#9. The 5Ss
The 5Ss are a series of Japanese terms, i-e, Seiri, Seiton, Seiso, Seiketsu, Shitsuke, meaning, Sort, Arrange, Clean, Improve and Self-Discipline. An organisation is wasting a lot of time when its employees squander precious hours looking around and finding things that are not arranged very well.
The tool therefore comes to your rescue in that it directs an organisation to sort and arrange things and keep cleanliness a top priority so that no one has to fritter away.
This is a four-phase model and a simplified version of DMAIC methodology. Among other six sigma tools, this can be used to carry out certain changes in your organisation. PDSA means Plan, Do, Study, and Act.
The Plan stage involves identifying a core issue, Do means developing a hypothesis, Study involves digging deeper into the reasons for the occurrence of a problem, and Act means actions needed to resolve them.
Six Sigma Tools for MEASURE Phase
This is a graphical representation of frequency distribution of data that is falling in separate groups. If you want to represent the results of your operations in the easiest way possible, then histograms are ‘the thing’. It gives a very quick visual summary of the data you want to understand.
#12. Pareto Chart
This helps you list down all your problems and helps analyse the one problem which has or may have a major impact on your operations. Sometimes a pool of problems may just affect only 10% of your operations, whereas that 90% may be a result of a single problem. Focus on that one difficulty, and a great deal of issues in your operations will fall into place.
#13. Trend Chart
This tool shows whether you are headed in the right direction. It shows results over a long period of time. It helps you look at where you were, where you stand now, and what your future looks like.
Six Sigma Tools for ANALYSE Phase
#14. The 5 Whys
The best way to get to the root cause of any issue is by asking questions and seeking answers. Ask the following question to yourself ‘Why did the X incident happen?’. Your quest to seek answers will lead you to asking further questions, ultimately leading you to the core issue.
#15. Ishikawa Diagram
Another term for Fishbone Diagram, this tool seeks to know all the contributing root causes that are or may be leading to a defect in a process. Since the issue is represented like a fish spine and all contributing root causes as branches emanating from that spine, it ends up looking like a fishbone, hence the name.
#16. Regression Analysis
This establishes a correlation between X component and Y component in any process model. X is an input variable, whereas Y is an output variable. No matter how perfect is the process model you created, it will always have some error points in it. But creating a line that has least error points and is closest to the company goal is what you need, and that is regression analysis.
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Six Sigma Tools for IMPROVE Phase
t takes its name from a metric paper size ‘A3’. It is a tool where a project report is presented on a single sheet, preferably A3, which provides all the information relating to the background of a project, its current situation, updates, target goals, follow up etc. It helps in keeping a manager abreast of the latest developments in a project. Since it is a continuous process, it must be carried out on a regular basis.
Kaizan is a Japanese term, which means continuous improvement. The goal is to improve product and service each day to increase profits and customer satisfaction. It also involves updating industry specific knowledge and coping up with fast-pace changes happening in this world.
#19. Hoshni Kanri
Called ‘value of lean deployment’ in layman language, this tool helps in guiding employees of an organisation to work towards that long-term goal which the business strives to achieve. If you have not drawn a long-term goal yet, it is high time you do so. It is essential because you will base all your future predictions on it.
Hoshni Kanri not only sustains business, it also drives the employees in their endeavour to bring out the best to the table.
#20. Kanban Pull System
Kanban is a tool used in keeping the inventory of an organisation updated at all times. It squarely means having enough inventory to fulfil demands, but at the same time not exceeding the demand so that the inventory doesn’t end up being a dead stock. Regular exchange of information and drawing communication channels between inventory department and sales department helps in keeping a check on this.
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#21. Poka Yoke
Also known as Mistake Proofing. You do not want a customer to point out mistakes with your products or services. The best way to deliver without any error is by preparing checklists and going through them one by one before sending them out. This way you will spare yourself the embarrassment.
#22. Heijunka Box
This tool is used to balance out the workload. You don’t want extreme workload on your employees one day, and see them sitting idle the next day. Doing work on an average basis makes sure that the employees deliver on a regular basis and are constantly kept in loop with the activities of a business. This also contributes to increased employee efficiency.
#23. Single Minute Exchange of Die (SMED)
Single Minute Exchange of Die helps in significant reduction of wastes. When you switch from one task to another, you take a while to get adjusted to the new zone. You lose concentration momentarily, get confused and hence end up making mistakes. This applies to all industries.
Switching machines from making one part of a product to making another may take time, but you still have to pay costs for that lost time. SMED focuses on reducing the switchover time by brainstorming and developing techniques to help cut time.
Six Sigma Tools for CONTROL Phase
#24. Statistical Process Control (SPC)
Once you have made an improvement in a process, you need to make sure that you hold on to it. Sustaining the development and meeting end requirements at the same time is what this Lean Six Sigma certifications helps us with. SPC ensures that the process remains stable.
#25. Standardised Work
This Six Sigma tool tells us to adopt best practices and best ways to accomplish a particular task. Experienced employees already have a nerve on this. All they have to do is clearly lay them down, document them, and update them regularly if need be. This also works as a base for new employees.
Lean Six Sigma and other six sigma tools is a very recent development. However, its tools and principles have been in practice since ages, in one way or the other, in various sectors across the globe.
Most of us may have seen our parents apply these somewhere in their workplaces, businesses and in their day to day lives at home.
However, with the increasing complexities in businesses and organisations, we need a much more improved version. A version that can quantify situations and make it easy to understand.
And Lean Six Sigma does all the job. Just a glance at notes, presentation and charts simplifies our understanding and explains the state of affairs.
Lean Six Sigma certification is a feather to your cap, will pass you as a strong candidate, will make you better at what you already do, and will land you a job you have always dreamt of.
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Ans. Lean Six Sigma is no more industry specific. It is a concept that helps improve functioning of any business. Since it is more function specific, it can be used in our day to day lives as well.
Here are some industries that have been using Lean Six Sigma for quite a while now:
Ans. Six Sigma tools have become an absolute necessity for any business and having Lean Six Sigma Certification on your resume is very likely to fetch you a better salary than those who don’t.
It shows how well versed you are in efficient operations management, control functions and gives out a sign of having good analytical skills. You can give your best as a business manager, team leader, data/business analyst, quality assurance manager, in project management etc.
Since Learning Six Sigma tools and Lean Six Sigma involves understanding high level concepts, practitioners in these areas are highly respected for their expertise.
Research suggests that Six-Sigma certified professionals in Europe made more money than those who didn’t have that certification. In the United States of America, Six Sigma certified professionals were able to earn somewhere around $167,000 per year.
Ans. There are various institutions that will tutor you on Lean Six Sigma Online. Among all the available online courses, you may want to hop on to www.henryharvin.com as it is ranked No.1 Six Sigma Certification in India.
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