Six Steps to Implementing Six Sigma

At one point Motorola had a losing streak in every market it served. Customer dissatisfaction and disappointment with Motorola spread everywhere. Operating costs continued to climb, resulting in dismal profits. All the market share it lost was taken by Japanese rivals.

Motorola's business system was not designed for customer satisfaction. Responses are slow and often not designed to satisfy customers. The quality and reliability of Motorola's products are also not as high as they should be. Customers experience too many unexpected product failures. The internal bureaucracy is self-sufficient with little regard for how to serve customers.

Fortunately, while Japanese companies beat Motorola in the market, they also provide a benchmark for how to do better. Several senior managers and supervisors were sent to Japan to conduct benchmarking studies to study operational methods and product quality levels. They found that Japan has a national employee engagement and teamwork program focused on improving operations to better serve customers. Japanese companies have achieved not only the use of labor provided by employees, but also their talents and knowledge.

From its customers, Motorola realized that it had to transform all operating systems, including manufacturing, service, administration and sales, to focus on total customer satisfaction. From Japanese companies, they have learned that having all employees in the company brainstorm is an effective way to improve efficiency and morale. Japanese companies have also made them realize that simplifying the design leads to higher levels of quality and reliability. Motorola's leadership put all of this together to create the "Six Sigma" vision and framework.

Six Sigma planning focuses on customer satisfaction, which leads to better products and services. This is a cultural change that affects every employee of the company. They will change their way of thinking, they will focus on their engagement at work, and they will see things around them differently.

Achieving Six Sigma is not the end, the pursuit of Six Sigma is a never-ending process. It consists of six steps: identify operational issues and metrics that need improvement; build a lean improvement team; identify potential causes of problems; explore root causes; When these steps are fully implemented, inefficiencies will be eliminated from all your operations, and your employees will have high morale and a relentless pursuit of excellence.

1. Establishing Problems and Metrics

First define what the operational problem you are going to improve is. It should meet three criteria: identify the impact of what you are going to improve; define the scope of what needs to be improved; and communicate consensus.

All interactions in a business related to the delivery of a product or service have an impact on the customer. You're going to study under what circumstances these effects are less than desirable. These effects are actually the result of causes upstream of the business process. The goal of a business improvement program is to identify these reasons and to improve the way things are done. And the way is to put quality into it.

An effective way to do this is the "ask why" technique, where you keep asking why until the operational question has objective, understandable meaning. Consider this example: In a company, everyone expects the computer to work without problems. When problems arise, they want the management information systems (MIS) department to fix them right away. The company does not have sufficient MIS resources to meet the "fix now" request. Instead, a more realistic expectation would be to ask the MIS department to resolve the issue within a 15-minute deadline or something. Thus, an operational problem in the MIS department should be defined as "20% of the troubleshooting requests take more than 15 minutes to resolve."

Thus, metrics must come from the defined operational problem. If your operational problem is "20% of bugfix requests take more than 15 minutes to resolve", then the metric you build should be the defect rate, which is "the number of requests that took more than 15 minutes to fix a bug" divided by "all Total number of fail-fix requests processed".

In terms of communicating consensus, you must demonstrate how the improvements contribute to the overall success of the business, and you must also reach a consensus with customers that you are doing the right thing.

2. Build an Improvement Team

When starting a Six Sigma project, you must prioritize improvement actions. Build a team that works to eliminate the reasons customers get defective products or unsatisfactory service. Once a Six Sigma project is established and running smoothly (usually 6-9 months after project initiation), an effective team must be in place. At this point, the focus of the adjustment has shifted from assigning team members to solve problems to arranging problems for team members to solve.

Before building a team, you must gain consensus from managers at all levels. Senior executives must realize that supporting teamwork is supporting the building of corporate culture. Managers must realize that they must be willing to reflect on the way they lead their subordinates.

When forming a team, you must get the right mix of people with different educational backgrounds, experiences and knowledge. Team members must be trained to master the improvement tools and how to use them successfully. Team members should consist of 3 to 8 people, including the team leader. Once the team has grown to 10 members, it is best to break it down into 2 small teams. This is because, after a team of more than 10 people, some team members become silent and no longer contribute to team activities or success.

Teams are most effective when everyone's talents are used and everyone understands their role in producing specific results. This will create shared responsibility.

Promoting balanced participation is critical. Balancing participation is recognizing that each member's interests are tied to the collective achievement, and therefore, everyone should be involved in discussions, decision-making, and a share of the success of the project.

3. Identify potential causes of problems

By now, you have identified operational problems that need improvement and established an improvement team. Next, before you start implementing improvement actions, you must determine if all the steps, policies, and initiatives need to be in place now to create a service or product for the customer. You can't waste time improving things that aren't necessary or even get in the way of high-quality performance. In addition to improving quality, eliminating unnecessary steps can reduce costs and cycle times.

The best way to do this is to draw a flowchart. Even if a business does not implement a continuous improvement program, it is beneficial to draw an operational flowchart at least every two years. It is often easy to stray from the right track by letting systems and actual operations run their own course.

There are two basic flow charts: linear flow charts and interdepartmental flow charts. Both approaches first address the "existing" situation. Then, you need to determine the "should" condition. Before continuing with the subsequent steps of Six Sigma, you must retool the system from "as it is" to "as it should".

The following example illustrates how a work team retools its system from "as it is" to "as it should". In-house testing laboratories must complete reliability condition testing before new electronic components can be placed on the market. This is an important final step after months of product development. A realistic period is determined to be 60 days, which includes stress tests that must be carried out for a minimum period of time. In other words, 60 days was the customer's expectation, and the lab failed to consistently meet the customer's expectation.

The working team then went through the Reliability Lab to create an "as-is" flow chart that handles reliability testing. The first thing they observed was that the test parts were wasting a lot of time waiting for the test plan, test bench and available equipment. They then focused the discussion on the delay phenomenon and the causes of the phenomenon.

The team schedules a joint meeting with people from Product Engineering. When asked about test plans, the product engineering folks pointed out that they only had 5 different test plans. It was previously decided that the test plan document would be in the hands of the reliability laboratory. They are named Plans A, B, C, D and E. When engineering submits a test part, they will specify the plan to use.

The dispatcher then asks if there is a way for the lab to be notified in advance when test parts are due. Product engineers responded that they always had several products waiting to be designed and developed, so they knew very well when specific product parts needed to be submitted to the lab. It was agreed that a weekly report would be sent to the lab scheduler.

The team made a successful decision to elevate the "as is" state of handling reliability testing to a "should" level. The team focuses only on which steps must be performed to get the results they want.

4. Investigate the root cause

Now, the focus shifts to investigating the underlying root cause. This requires a focused action plan. An effective action plan has 4 components: what needs to be done; who will do it; when it is scheduled to be done; and what is the status of action items, especially overdue items. For some action items, the owner may be the entire team.

A plan of action is a living document with a life of its own. Six Sigma projects often take months to discover all root causes, implement solutions, and get the desired results. When certain actions are completed, new actions are spawned. As the team goes deeper into the root cause process, they discover new things to do and new information to gather. In this way, the action plan becomes a historical record of the team's activities.

The tool for collecting fresh information is a "checklist", the purpose of which is to determine what data you intend to collect, where to collect it, and for how long. You should have a good understanding of how to decide your own actions based on what the data shows. This will help guide you in designing the format of the checklist and knowing where to collect the data. You also have to decide in advance how the message will be communicated.

Five, long-term improvement measures

Teamwork has changed the corporate culture. Bringing employees at all levels together to share a shared vision of what’s important and how to keep working toward better performance increases morale. All people who use Six Sigma methods will have an improved work life.

The key to a successful Six Sigma implementation is customer focus. If you think you know your customer's needs but haven't confirmed it, then you need to reach out to them to make sure the team is focusing on the right goals. Once the team is focused on customer satisfaction, internal conflict becomes unnecessary.

Of course, everyone develops to do things differently and do it better. This became a new way of thinking that facilitated profound cultural change. As a culture that encourages employees to follow orders without thinking changes to one that encourages employees to use their skills to the fullest and constantly think about better ways to work, the perception of the work environment can also change very positively.

6. Demonstrate and Celebrate Improvements

Have teams demonstrate how their achievements contribute to the overall success of the department, division, and enterprise.

Before launching a Six Sigma project, it is important to complete the required organizational development work. Businesses must state and communicate goals to guide team activities. Top management's stated goals typically include: increasing market share; reducing manufacturing costs; increasing new product introductions; shortening product delivery and service response cycles; increasing profits; and improving the quality of products, services, and administrative functions.

Each team must identify at least one of these goals and have their projects positively impact that goal. Tactics are bottom-up action plans provided by each work unit, department, or division. The operational issues, activities, and action plans established by the team are part of the corporate strategy.

The team must be affirmed at all times throughout the Six Sigma effort. As a manager, the most precious thing you can give is time. Visit the team's meetings every now and then to see what they're doing and give some verbal praise and encouragement. Also, learn about team members' schedules and share breaks with them.

There are other forms of acknowledging your team's accomplishments. Such as giving each team a bulletin board to show their activities and progress. Also, in your normally scheduled monthly meetings, set aside five to 10 minutes for one or two teams to give them an update on the project. If you have an internal newsletter, create a section that highlights your team's activities and achievements.

Original text excerpted with permission from Demystifying 6 Sigma: A Company-Wide Approach to Continuous Improvement by Alan Larson, copyright 2003. Translated by Lian Qingsong.

This book is published by AMACOM, an affiliate of the American Management Association. The English version of the book is available for purchase from McGraw-Hill Education Asia in Singapore.

By Alan Larson, a management consultant and former Director of Quality for Motorola's Business Unit.