Cornerstone Consulting Blog

How Six Sigma Can Benefit Your Business

Apr 25, 2018 6:23:00 PM / by Bill Currence

operations-consultingIf you run a business, you may have heard about using “Six Sigma” to improve the efficiency and quality of your operations. What is Six Sigma, and how can it help your organization?

 

What Is Six Sigma?

Motorola developed the Six Sigma program in 1986 to improve the quality of its manufacturing process. Working from the theory that low and inconsistent quality leads to failure of a product (or business), the company implemented a goal of reducing defects in the manufacturing process to 3.4 defects per million opportunities. To accomplish this, it addressed every aspect of the process with an aim to standardize each. Ideally, each process is kept within three units of deviation from the standard (above or below a center line). (In statistics, sigma represents one unit of standard deviation, so “Six Sigma” refers to the six-unit range around the ideal.)

For example, a soda bottling plant determines that each bottle should be filled with precisely 12.0 oz. of liquid, and it sets its standard deviation level at .001 oz. Bringing the production line into Six Sigma compliance would mean that all bottles are filled with between 11.997 and 12.003 oz. of liquid.

In order to accomplish this standardization, Motorola and other companies that adopted these ideas developed a number of tools and methodologies. Originally focused on the manufacturing process, the philosophies of Six Sigma are now applied to all aspects of business.

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How Can Six Sigma Benefit My Organization?

A core tool of Six Sigma is an approach known as DMAIC (define, measure, analyze, improve, and control). DMAIC starts by identifying the problem, determines the steps that will directly address the issues, recommends concrete actions, and ends with the implementation of long-lasting solutions. This approach uses data to eliminate defects in every facet of a business, from production to supply to customer service.

The benefits to an organization include

  1. Reducing or eliminating waste and variation
  2. Promoting standardization and flow
  3. Improving time management and production timelines
  4. Improving efficiency
  5. Reducing costs (both manufacturing and consumer-facing)
  6. Enabling more effective strategic planning
  7. Improving customer satisfaction

 

How Can I Get the Benefits of Six Sigma?

An operations consultant can analyze your business using Six Sigma principles and recommend specific actions to improve efficiency and reduce variation in the targeted areas of your business. Although implementing these solutions often requires some initial investment, Six Sigma is a data-driven approach that should forecast predictable results.

For example, an operations consultant analyzes the aforementioned bottling plant and determines that adding two additional staffers to the production floor would reduce the average fill deviation significantly—enough to recoup the additional labor costs within four weeks and become profitable thereafter. The consultant presents hard numbers with her analysis, allowing the business to make a justified capital investment in the additional staff.

As your company becomes more efficient and effective, the secondary effects can manifest in improved employee satisfaction and retention, more productive overall operation, and fewer fires to put out on a day-to-day basis.

 

Contact Cornerstone Consulting Organization to learn how your company could benefit from implementing Six Sigma. Our operations consulting specialists can help identify problems, analyze options, and implement solutions that can help your business become more efficient, effective, and profitable. Contact us today to schedule a consultation.

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Written by Bill Currence