Deploying Six Sigma QFD

Deploying Six Sigma means entering a period of significant change in your organization. Productivity and morale almost always suffers in times of great change. The requirements of change and adaptation and the very human fear of the unknown add to stresses of the work environment. In these times, communication becomes more important than ever.

Communication throughout a Six Sigma project is very important because the power and scope of Six Sigma demands a significant commitment from everyone in the organization. Six Sigma successes require clear and open communication at all levels to transcend departmental barriers that would otherwise cause confusion. In addition, any change in an organization will meet some resistance, either intentional or just because of inertia. When management can effectively communicate that it is behind that change and can communicate the positive aspects of the change, resistance can be countered and overcome.

Company leadership must be willing to give Six Sigma teams all of the tools and information necessary to apply Six Sigma concepts to their day-to-day activities. It is crucial in Six Sigma projects to clarify the rationale, expectations, goals, and sequence of steps in the process. Six Sigma teams with clear, written goals accomplish far more in a shorter period of time than teams without them could ever imagine. This is true everywhere and under all circumstances. Documentation of the Six Sigma process is the opportunity to resolve any misunderstandings of the deployment. A schedule is developed that outlines the strategy to take the process from its current state to one that is within statistical control and in line with the company's Six Sigma goals. Roles need to be clearly defined in how individuals contribute to the schedule and strategy. Employees assess how they can contribute to the organization through the information they receive. A team's quality goals should be set to tie in with the overall company quality improvement goals. This happens only when the team has the knowledge they need.

Lack of clarity in communicating business information is probably more responsible for frustration and underachievement than any other single factor. It is unfortunately way too easy to not realize that communication is falling short of your organization's needs. Often senior managers sincerely believe they are adequately communicating with employees. However, managers can easily underestimate the number of issues on which employees need information and how much information they need.

How do you know what is important to employees and what to tell them? You need to put yourself in the position of the employees. If you were that person, what would be important for you to know to do your job? What would you be worried about in the current situation? What information would help you deal with change? How would you want to be told? You can't answer those questions yourself. You need input from the very people you are trying to understand. Communication is a two-way street—listening as well as talking. Asking a few individuals what is being said, what people are worrying and wondering about.

Also be aware that the way a person receives news can dramatically affect how he or she feels about it, so you need to choose the medium very carefully. E-mail can be perceived as cold and unfeeling, although it is useful for routine updates that don't have emotional overtones. Many messages are better delivered in person, either to individuals or to the team as a whole.

Communication skills take practice. Always be sure the message remains honest, clear and compassionate. Have integrity and build trust. Don't say what you don't mean. Don't promise anything that you cannot or will not fulfill. Above all, follow through on your commitments and promises. Nothing turns employees off more than feeling betrayed. Sincere, caring, and constant communication will form the basis for building employee engagement throughout Six Sigma deployment.

Many service sector companies have no doubt successfully deployed Six Sigma and are currently deriving its benefits, but you just cannot declare Six Sigma as the best based on this because what is also true is that the statistics are the same for service sector companies that have failed to derive any real benefits from Six Sigma deployments.

Why Failure Rates Are Higher In Mobile Workforces

Statistical data also suggests that the largest incidence of Six Sigma setbacks has been noticed in niche domains such as sales and marketing that mostly comprise of mobile workforces. So, what is the main reason for this mismatch? Well, it is obviously because the concept of deploying Six Sigma in mobile workforces is a relatively new one.

Since all new concepts go through a trial and error phase until they are perfected, it does not come as a surprise that many service sector companies have failed to derive the benefits of Six Sigma deployments. In effect, it means that the failures are mainly due to the inability to make the right use of Six Sigma tools and techniques rather than the concept of Six Sigma as is generally believed.

The truth in fact is that Six Sigma can be made to work for mobile workforces in quite the same way as it might work for manufacturing business units. Explained below are some essential tips that will help in achieving the above stated objective (i.e. deploying Six Sigma in mobile workforces).

Highlight the Benefits to Mobile Workforces

Mobile workforces, such as sales personnel, usually have an autonomous work style and are not forced to follow standardized procedures and policies. This is usually because in their business what really counts is the end result and not the method that might have been utilized for achieving the desired results. This is exactly the reason why mobile workforces generally do not take too well to standardized procedures as they may be asked to follow during Six Sigma deployments.

Now, this might look like an insurmountable problem, but it is certainly not so and can be overcome just by highlighting the prominent benefits to the targeted mobile workforces. However, it's recommended that team leaders exercise patience obviously because it will take time to change old habits and move over to a new setup.

Offer Special Incentives

To speed up the changeover process, businesses can launch special incentive schemes, targeting mobile workforces who might be willing to shift to the new setup. The incentives may also be offered in the form of a compensation package, targeting mobile workforces who after shifting to the new setup might be finding it difficult to achieve the same results as earlier. Team leaders are advised to keep a close eye on the activities of their mobile workforces because even though quite effective, incentive schemes also hold a great potential for misuse.

Apart from these, businesses should also conduct regular meetings and seminars to discuss the relevancy of the suggested changes and also to ensure that mobile workforces do not lose their interest midway. Deploying Six Sigma in mobile workforces and deriving the associated benefits will then be as easy as cruising along an open highway.

The Process

Including the finance department in Six Sigma deployment is a decision usually made at the design stage of the operation. Here, the department is treated as an associate in the establishment and operation plan. Easy said than done, many operations people are of the view that people related to accounting or anything to do with it are scorekeepers, auditors, or bookkeepers. Making them adapt to the awkward inclusion of the finance department is always a barrier.

All the ideas that had the ability of becoming Six Sigma projects have to be evaluated by the finance department before being finalized. Thereafter, the finance department authenticates the potentiality of every project to affect the result. This not only restricts process owners from pinpointing Six Sigma projects but also allows them to identify prospects. Additionally, financial evaluations act as decisive factors for business decisions and viability of an opportunity to the Six Sigma project.

Six Sigma Committees are active in the decision-making process. It is known that process owners and Belts frequently criticize the inclusion of the finance department and hold it responsible for the stagnation of profitable projects. However, later they become conscious that the projected advantages of a few projects may not even influence the result.

Finance can work with the teams for identifying the advantages of any project. There are times when some projects actually project more profits more benefits compared to what the process owners originally forecasted. The process owner and the finance department should concur on how these benefits can be premeditated after implementation of the project.

A second review of the inclusion of finance is carried out at the end of the DMAIC process. Afterwards, the ownership of the solution is immediately transferred to the process owner. The Belts are not involved with the calculation of benefits - they only concentrate on the DMAIC process.

Eventually, during first year after the implementation of the date solutions, the company records the profits. If there is a possibility of making an improvement, new Six Sigma projects are created. Whereas involving finance in a Six Sigma project generally starts before involving the Belts, it also goes on even after the Belts transfer ownership of the solution to the process owner.

Advantages of involving Finance in Six Sigma

-By recruiting a finance team to calculate the benefits, the real benefits are easily recorded with accuracy. This allows the team to focus completely on improving the KPI, without thinking about the final financial results. An improvement in the KPI can affect the bottom line.

-Inconsistencies may occur due to differences in working and handling styles. Instead, insisting on a single process that ensures proper financial calculation of every operation can offer comparable results.

-If the process of calculation remains with the owner, they may end up forgetting to calculate other processes that are affected by the calculation.

-These audits can be conducted internally or by simply inviting eternal teams to review calculations of the benefits.

Working with the finance department requires effort and a more proactive approach. Every finance team requires a single member to work on each individual project - this is required to understand the business better and influence the results of the company.

There have been many debates and discussions among Six Sigma experts regarding the transactional costs and how Six Sigma strategies can be implemented to reduce the transactional losses. But before that, let's discuss transactional costs. To know in detail about transaction costs let's check out a section on Transaction costs from Larry Downs and Chunka Mui' book "Unleashing the Killer App". The book states that in all there are six types of transactional costs but for a more comprehensive approach another cost can be added to this list. The costs are:

Search Costs: Which tells a business how much searching for new suppliers and customers cost in time and money.

Information Costs: The costs that you have to incur for informing buyers about your product and quality and to know for yourself the potential customers and later customer details.

Bargaining Costs: The cost incurred for negotiating the terms of the sale. It depends a lot on the type of product or service that is being negotiated like for a multimedia CD the cost will be low but it will escalate when you are negotiating for a latest car model.

Decision Costs: There are considerable costs involved in the decision making process, such as the time and money spent to decide on buying a product.

Policing Costs: Again, there are substantial costs involved to ensure that the terms and conditions of sales and services are met.

Enforcement Costs: And there are costs for resolving the unmet terms of sales and service as well.

IT Costs: And the last cost that is not mentioned but should be invariably added in the list is the information technology cost. Information technology is something without which no company can carry out its day to day transactions of ordering, invoicing, purchasing, and payment processing. Therefore, the cost incurred on IT should also be taken into consideration while making a list of transactional costs.

Different Products And Services But Same Transactions For All Business Organizations:

Each business organization is unique in terms of the product or services that it offers but when it comes to internal operational and administrative transactions they are on same platform. All companies, whether they are categorized as manufacturing or service, have to take care of orders, issue invoices or bills, purchase supplies, write checks, apply payments and handle all its financial transactions like any other business organization. And even if the core of your business is a product or service, the key to making a profit lies in effective administration of transaction processing.

Speaking of financial transactions, your cash flow will also depend on following things:

Accuracy: in quantities, pricing, taxing etc and your cash flow will definitely suffer even if you made the perfect product but the customer demanded something else.

Speed: Speed matters when it comes to increasing the cash flow. And it does not matter if you offer the best product of the world but if it takes unnecessarily long to get it ordered, delivered and installed, then customers won't wait for your product with bated breath. The transactions must be created and processed with quick precision and accuracy, along with having an extra team to fix an incorrect transaction on the spot if one arises.

Cost: Always keep an eye on the cost for creating and processing a transaction and the scrap and rework costs as well that occurs when an incorrect transaction is done.

Basic Tools Of Six Sigma And Lean Six Sigma Used For Accelerating Cash Flow:

Tools of Six Sigma- for finding and fixing errors on bills, orders etc make use of line, fishbone, and Pareto Six Sigma strategies. For monitoring the transactional error and cash flow, a p chart or XmR chart can be used.

Tools of Lean Six Sigma - Lean Six Sigma will help you to find out and eliminate the delays in any transactional process that will additionally aggrandize your cash flow as well.

The conclusion that can be drawn from the above two points is that if you are only implementing Lean Six Sigma, then you will not be able to reduce defects in all processes. However, a combined effort can easily point out and rectify the errors in a transactional process.

Identifying Areas Of Improvement

Six Sigma is not easy to implement and requires a lot of effort on part of the organization to make it a success. It makes sense to implement 6 Sigma concepts only in areas where the potential for reducing costs are quite immense. The best way of identifying the areas of improvement is to utilize statistical tools and techniques that help in measuring the existing value provided by a business process and also the potential benefits that can be derived by implementing Six Sigma. Statistical tools and techniques also help in assessing the cost of the implementations, which allows the senior management to select only the most cost-effective implementation projects.

Utilizing The Services Of 6 Sigma Professionals

For ensuring the success of Six Sigma implementations, it is necessary to utilize the know-how and expertise offered by 6 Sigma professionals such as Black Belts, Master Black Belts, Six Sigma Champions and others. Most of these professionals have live experience in executing 6 Sigma implementation projects and provide multi-level support during the implementation process. The only problem is that Six Sigma professionals charge top-dollars for their services, which can create financial problems, especially for organizations that are already facing a resource crunch.

Since it is quite difficult to implement 6 Sigma concepts without the guidance and support of Six Sigma professionals, the best option for these organizations is to train their existing employees. Depending on implementation needs, organizations can choose from a wide range of certification courses for their employees. By transforming existing employees into 6 Sigma professionals, organizations will be able to harness their existing organizational knowledge and the expertise that they develop during the training. Another benefit is that such organizations will never have to deal with expenses related with hiring Six Sigma professionals from outside because most of the skills and expertise will be available in-house.

Leadership Support And Guidance

For timely and effective implementations, it is necessary for top-rung management to provide continuous support and guidance to 6 Sigma implementation teams as and when needed. The senior management can provide valuable insights during the implementations and can define the specific roles of implementation team members in order to avoid the potential occurrence of conflict and confusion.

The actual execution of Six Sigma implementation projects is quite similar to the execution of any other management-related project undertaken by an organization. The aims and objectives of the projects may differ widely, but the managerial tools and techniques employed for executing the projects are more or less the same. We can thus conclude that the basic management principles apply to 6 Sigma implementations in the same way as they apply to any other management initiative.

Deploying Six Sigma means entering a period of significant change in your organization. Productivity and morale almost always suffers in times of great change. The requirements of change and adaptation and the very human fear of the unknown add to stresses of the work environment. In these times, communication becomes more important than ever.

Communication throughout a Six Sigma project is very important because the power and scope of Six Sigma demands a significant commitment from everyone in the organization. Six Sigma successes require clear and open communication at all levels to transcend departmental barriers that would otherwise cause confusion. In addition, any change in an organization will meet some resistance, either intentional or just because of inertia. When management can effectively communicate that it is behind that change and can communicate the positive aspects of the change, resistance can be countered and overcome.

Company leadership must be willing to give Six Sigma teams all of the tools and information necessary to apply Six Sigma concepts to their day-to-day activities. It is crucial in Six Sigma projects to clarify the rationale, expectations, goals, and sequence of steps in the process. Six Sigma teams with clear, written goals accomplish far more in a shorter period of time than teams without them could ever imagine. This is true everywhere and under all circumstances. Documentation of the Six Sigma process is the opportunity to resolve any misunderstandings of the deployment. A schedule is developed that outlines the strategy to take the process from its current state to one that is within statistical control and in line with the company's Six Sigma goals. Roles need to be clearly defined in how individuals contribute to the schedule and strategy. Employees assess how they can contribute to the organization through the information they receive. A team's quality goals should be set to tie in with the overall company quality improvement goals. This happens only when the team has the knowledge they need.

Lack of clarity in communicating business information is probably more responsible for frustration and underachievement than any other single factor. It is unfortunately way too easy to not realize that communication is falling short of your organization's needs. Often senior managers sincerely believe they are adequately communicating with employees. However, managers can easily underestimate the number of issues on which employees need information and how much information they need.

How do you know what is important to employees and what to tell them? You need to put yourself in the position of the employees. If you were that person, what would be important for you to know to do your job? What would you be worried about in the current situation? What information would help you deal with change? How would you want to be told? You can't answer those questions yourself. You need input from the very people you are trying to understand. Communication is a two-way street—listening as well as talking. Asking a few individuals what is being said, what people are worrying and wondering about.

Also be aware that the way a person receives news can dramatically affect how he or she feels about it, so you need to choose the medium very carefully. E-mail can be perceived as cold and unfeeling, although it is useful for routine updates that don't have emotional overtones. Many messages are better delivered in person, either to individuals or to the team as a whole.

Communication skills take practice. Always be sure the message remains honest, clear and compassionate. Have integrity and build trust. Don't say what you don't mean. Don't promise anything that you cannot or will not fulfill. Above all, follow through on your commitments and promises. Nothing turns employees off more than feeling betrayed. Sincere, caring, and constant communication will form the basis for building employee engagement throughout Six Sigma deployment.