Six Sigma in the Wine Industry?

The process of wine production from the selection of grapes—pre-harvest preparation, grape processing, fermentation, clarification, stabilization, aging, TTB Label design & approval—to the bottling of finished wine must be done perfectly, or excellently at least. Nothing is left to chance for the discriminating taste of wine drinkers. Is there room for Six Sigma here?

Definitely! For now, though, let’s take a look at a heady concoction of women and wine on Global Business Watch.

Filed under: Manufacturing

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Lean Six Sigma for Military Construction Transformation

Two of today’s improvement trends that make work faster (Lean) and better (Six Sigma) produce amazing results when combined—Lean Six Sigma.

U.S. Forces Korea banks on this methodology to work favorably for them as they transform and move troops onto a major military hub at Camp Humphreys. You can just imagine the logistics involved in this kind of movement.

Early this month, U.S. Army Corps of Engineers Lt. Gen. Carl A. Strock visited the Korean peninsula to check on the developments. During his visit, he was happy to know that the South Korean government and people were fully supporting the corps.

In an interview with The Stars and Stripes, Strock was asked how they would go about the “military construction transformation?”

It’s related to a process called Lean Six Sigma, which we’re using to change how the Army does its business. At its heart, our districts are business operations. They don’t have any central funding; they’re funded by the projects they do. It’s very clear to us that with the dynamic nature of change today, we need to be more responsive, we need to be able to turn requirements into facilities a lot quicker than we do now. It’s particularly critical as you move units around that when they either return from combat or when they stand up a new brigade combat team. Obviously those facilities to house, train, care for those soldiers, they must be ready on specific dates.

What we’re doing, essentially, is we’re going to standard facilities. Right now, installations and major commands have more flexibility in describing the facilities requirements. We’re going to standardize those Armywide … particularly where common facilities like barracks and dining facilities and admin facilities are concerned … (Another focus is) more reliance on … building components that are manufactured off-site then assembled on-site. Read more…

I believe there has been much controversy over the effectiveness of Lean and/or Six Sigma. At Oracle, the methodology operates on the following tenets:

• Lean Six Sigma’s goal is the elimination of anything that doesn’t meet your customer’s quality requirements (a.k.a. defects).
• It focuses on the steps that constitute the work and the flow of work between groups, with the goal of eliminating variation (the Greek letter sigma denotes standard deviations in statistics) while improving process flow and speed.
• The Lean Six Sigma environment encourages people to work collaboratively, discussing and resolving problems openly. Teams foster effectiveness by setting goals, assigning accountability, reaching good decisions, and collaborating with other groups.
• With Lean Six Sigma, decisions are based on facts, not guesswork. Data includes result measures (how the product or service turned out) and process measures (what happened to produce the result).

Filed under: Services, Lean Six Sigma, Team Dynamics

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Data Quality

If you’re still interested to know more about data quality. Check this book out on Amazon.

There are only positive reviews of this book: “Groundbreaking!” “A superb blend of theory and application.” The author, Jake E. Olsen, has been declared “a master practitioner.”

Jack Olson coined the term “data profiling” and essentially founded this important new field in the area of data quality assessment. His revolutionary techniques, outlined in this book, can provide IT professionals with an important new set of tools for analyzing data quality. This is a must read for anyone working in the data quality field today. I also recommend it for people in related fields such as data warehousing, Enterprise Application Integration, and database design. With so many “me too” books in the computer field, it’s a real joy to find a book that really does break new ground. ~Shawn B. Wikle “wik” (Austin, TX)

Filed under: Training, Six Sigma References

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Checking on Six Sigma Data

A major component of Six Sigma is data, or data mining. In fact, acquiring and storing good quality data is the key to a successful Six Sigma initiative.

Several months ago, I wrote about certifying data through Six Sigma. I mentioned about establishing data standards through service level agreements (SLAs) and administering them by an organized data governance structure. However, before you can do this your data must have some of the following typical metrics: accuracy/precision, completeness, reliability, availability, timeliness/freshness, consistency, and uniqueness.

Now, let’s assume that you have certified data and you’re well on your way to your Six Sigma project. How then do you ensure that you have quality data through and through?

You can ensure data quality (DQ) in two ways: off-line and in-line.

The off-line DQ process is run outside of the certified data production process, while the in-line DQ process is run in synchronization with the certified data production process. The relationship between the two DQ processes is shown in figures and comparative analysis here.

After doing the DQ, it’s now time for you to take action. You can do two processes that ensure your DQ is indeed measurable.

1. Scoring: This process focuses on evaluating the metric data captured in order to provide a measurement (score) of the degree of the data quality. This score is published with the data and available for use in reporting so the end data consumer can understand the degree of confidence that can be placed in the data.

2. Monitoring and control: This process focuses on capturing and dealing with the metric data that is captured during the measurement processes. The emphasis here is data quality and process improvement. This is a straightforward process for determining a course of action to take based on a set of parameters and rules. During this process, the following sequential steps are executed:

• Collect: The monitored data points are collected and stored. The storage may be temporary or persistent.
• Classify: They are then classified and categorized based on the type of check performed, the priority of the data quality check, and user-selected data quality attributes.
• Detect: Rules are executed based on the classification of the data quality data points. If a data quality fault is detected, an action is taken.
• Act/control: If a fault is detected, a sequence of one or more actions is initiated. These may include providing e-mail notification, fixing the fault, aborting the data quality job stream or continuing with the job stream while noting exceptions.
• Log: The detected fault and the resulting actions are stored in a log file that can be used for auditing or analysis.

By going through these steps, you are not only gathering data but already you are also evaluating the kind of data you have. With high quality data, you can then so statistical process controls and other statistical tools en route to improving your processes.

Below is an example of a real-world Six Sigma DQ process.

A major U.S. financial institution is well on its way to implementing a data quality/certification process across all of its enterprise data, which currently comprises 80 sources. The first step in this process was driven by the bank’s regulatory compliance requirements. The bank needed to supply Sarbanes-Oxley compliant demand deposit transaction data to its finance data warehouse where data is aggregated, analyzed and used for reports to management, regulators and investors. As part of the assurance process, this data was processed through a data hub where the mainframe-supplied demand deposit transactions are extracted, converted, and transformed into a form usable by the bank’s financial accounting system. In addition, a robust monitoring and control process was used to implement the tights rules and thresholds required by the bank for detecting potential faults during both profile and process checks:

• Collect: The numbers of records and bytes are captured after key lookup and aggregation steps. A user-defined check of total average monthly balance is also calculated and monitored.
• Classify: These data quality checks are classified as high priority/alert checks.
• Detect: Values are compared to a moving average of previous months’ values. If the values deviate greater than 5%, a fault alarm is raised.
• Act/control: If a fault is detected, an alarm is raised and a message is sent to both system operators and data analysts familiar with demand deposit data transactions. Further processing is stopped until a resolution is reached, which may be a decision to continue processing or to correct errors and re-initiate the transformation process.
• Log: The data quality check point values, the fault and any subsequent actions are logged.

Source: Six Sigma Data Quality Processes

Filed under: Tools/Toolkits, Data

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Six Sigma Out to Eliminate Defects in BPOs

Business process outsourcing companies (BPOs) are having an exciting time these days. The countries that are favored destinations in the world are celebrating because of the increasing demand for BPOs. You have India, Australia, China, Ireland, and the Philippines.

India has been thought to be the most preferred for reasons such as “availability of vast talent pool, good telecom infrastructure, conducive government policies, stable economic environment and, above all, cost arbitrage benefits.”

The country however is aware that the other countries on the list are fast catching up, especially in the IT/ITES/BPO sector. To maintain its lead, India needs to move up the value chain by ensuring superior quality of service. Where else would they turn but to Six Sigma.

It’s good that India recognizes the value of Six Sigma on their BPO operations. With Six Sigma, they can integrate various strategies and tools from statistics, quality, business and engineering with the adoption of new ones likely as its use expands to more business sectors and areas of application. They know they can use two Six Sigma roadmaps: (1) the DMAIC directed toward significant innovation or improvement of an existing product, process or service and (2) DFSS that centers on product, system or service design.

QAI India Ltd. Consulting presents the key reasons for the IT/ITES/BPOs and customer contact centers to implement Six Sigma.

• Faster route to process maturity in a relatively less mature industry: The ITeS industry in India is still young and therefore still in the process of increasing their capacities and building delivery capability. However, the ‘Key Business Processes’ that they are handling for their customers are mature and stable. ITeS providers need to bridge this gap, and need to stay focused on quality and process management even as they grow at a frantic pace.
• Metrics-based management: Operating in an environment where multiple ‘moments of truth’ occur with the clients every single minute and span of controls in the management structure are very high, it becomes imperative for the industry players to have a robust metrics system for measuring, tracking and managing the business.
• Process control: ITeS providers need to maintain very tight control over their processes, for ensuring consistent customer experience.
• A disciplined improvement path: Continuous process improvement is a key imperative in order to enhance service and quality at lower costs. SLA’s often demand year on year improvements in process metrics and cost reductions.
• Customer orientation: Capturing the Voice of the customer - both the client whose process you are handling and the end customer.

Well, I heard about all sorts of stories in doing business with BPOs and contact centers both pleasant and unpleasant. I know that if they do decide to go Six Sigma, they’ll reap the rewards they deserve.

Sources:
Six Sigma Spells Success for BPOs
Six Sigma for BPO and Customer Contact Centers

Filed under: Tools/Toolkits, Services, Outsourcing

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Another First from a Six Sigma Organization

The Six Sigma organization, Samsung, is improving its processes more, not only to please its customers but also to help preserve the environment. The company has invested $1 million to develop fuel cells for cellular phones. Read about it on Global Business Watch.

Filed under: Manufacturing, Six Sigma Organizations

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Six Sigma CEO of the Year at The Depository Trust & Clearing Corporation (DTTC)

Being a woman and a Six Sigma advocate, I celebrate with Jill Considine for winning the Six Sigma CEO of the Year (2006) Award. Congratulations for a job well done, Ma’am!

On June 28, at The Venetian Resort-Las Vegas, during The 2006 Global Six Sigma Awards Gala Dinner, Ms. Considine will address the audience on Six Sigma success at DTCC. She bested 30 other CEOs of global organizations including DaimlerChrysler Corporation; Capital One Direct Banking; Cooper Tire & Rubber Company; Saudi Aramco; and TD Canada Trust among others.

Ms. Considine is an internationally recognized leader in financial services. She is a member and regular speaker at the World Economic Forum in Davos, Switzerland, and was appointed by President George W. Bush to the Advisory Committee for Trade Policy and Negotiations. She is a member of the Council on Foreign Relations and a board member of the Partnership for New York City. In addition, Ms. Considine currently serves on the board of directors of the Federal Reserve Bank of New York, in addition to serving on other public and non-profit boards.

The Depository Trust & Clearing Corporation provides clearance, settlement and information services for equities, corporate and municipal bonds, government and mortgage-backed securities and over-the-counter credit derivatives.

You would wonder how the company achieved Six Sigma being the largest financial services post-trade infrastructure in the world, with operating facilities in multiple locations in the U.S. and overseas. The company may surely have launched several Six Sigma projects. One of them was featured as a case study on isixsigma.com. It talks about how DTTC turns to e-learning to train its employees for Six Sigma.

The company turned to e-learning when the Customer Training Department strived to satisfy the increasing volume of customer training requests. A growing product line presented challenges in finding instructors who were certified on each of the products, and the need to rapidly deploy updated information was becoming more and more crucial.

As most training programs, the Customer Training Department of DTTC met problems and limitations. To overcome them they had to re-examine their organizational structure and then deployed the DMAIC roadmap incorporating VOC, CTQ, and Root Cause Analysis.

The result: Developing E-Learning the Six Sigma way has allowed DTCC’s Customer Training Department to both identify and exceed critical customer and business requirements for E-Learning, reduce overall development time by close to fifty percent, reduce annual development costs by $282,000, and articulate E-Learning in a way that business managers understand. Perhaps just as important as the savings and the identification of customer and business requirements is the ability that the Customer Training Department now has to maintain this high level of performance.

You can hear now Ms. Considine proudly saying,

“DTCC plays a critical role in bringing safety, soundness and reliability to the post-trade processing infrastructure in the U.S. markets, “and we play a collaborative role with other service providers and infrastructure organizations around the world. Our Six Sigma initiatives help us ensure that we continue to protect the industry from risks inherent in growing trading volumes, the complexity of trading instruments and the influence of globalization and consolidation.”

Jill Considine, The Depository Trust & Clearing Corporation, Wins the Six Sigma CEO of the Year Award as The Global Six Sigma Awards, announced on QsoftGuide.com and on SixSigmaZone.com

Read the case study: Developing E-Learning the Six Sigma Way.

Filed under: Tools/Toolkits, Benefits and Savings, Services, Six Sigma Organizations, Finance, Awards, Training, Team Dynamics

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The Certified Six Sigma Black Belt Handbook

I visited Six Sigma forums again today. It’s such a learning experience to be doing so. You get to learn about real issues and concerns of Six Sigma and quality practitioners.

So today, Joe Patterson claimed that he had been helped by The Certified Six Sigma Black Belt Handbook by D. Benbow and T. Kubiak.

His exact words were,

“If anyone is preparing to take the six sigma black belt certification exam, there is one book that is a must: THE CERTIFIED SIX SIGMA BLACK BELT HANDBOOK by D. Benbow and T. Kubiak - published by Quality Press (ASQ). I have over 15 text books on six sigma - but none of them compares to the simplification this book gives - there was not anything in this book I couldn’t figure out on my own. I really liked how this paralleled the test. I wish I had this book 2 years ago! I received the book only 2 weeks before my third test. I was able to read through it in my spare time with a fine tooth comb in just under a week. I also believe it helped me grasp a few areas that I was having difficulty in such as probability. I will be recommending this book to anyone who wants to learn about six sigma! Thanks again for putting this book together! I really needed this.”

It comes with a CD that contains a wide selection of supplementary problems covering each chapter and a simulated Six Sigma Black Belt exam which has problems distributed among the chapters according to the scheme published in the body of knowledge for the ASQ certification.

Well, who knows you might find this book useful too.

Filed under: Training, Certification

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Marketing Through Six Sigma

The marketing function of a company will be a different ball game when done in line with Six Sigma initiatives. What is customary is that the marketing department does market research by interviewing customers, do focus groups, surveys of customers or other related businesses. They then report what they’ve found out about the market to top management who in turn will give the overall direction of the organization. In other words, marketing takes on a critical responsibility as they identify which arena(s) the company is competitive or not.

With Six Sigma, the marketing department need not only communicate this information with the executives but also with those people responsible for Six Sigma projects. It is even important that the voice of the customer (VOC) is made clearer to the Six Sigma practitioners in the organization. Not only that, it is equally important that the critical to quality (CTQ) aspect is also understood by everyone.

Any information provided to those responsible for Six Sigma projects should be very clear to direct and guide the projects. This is how to do it:

1. Market report must reflect both market and customer feedback. Six Sigma initiatives have the dual purpose of attracting new customers while retaining current ones. Analysis of the information must include the ability to identify the relative impacts of quality and price on customer value perceptions.

2. Both marketing managers and Six Sigma Champions and Black Belts must learn to use the tools of multivariate statistics in order to properly interpret the data.

3. Both must also understand and provide a holistic view of how the market defines the value of quality—that value at the point of production does not necessarily translate into value at the point of consumption. Issues of product support, parts availability, service, warranty and so forth should all be considered equally as these are the metrics by which consumers put value to your company’s offerings. Consequently, the value information collected and provided by marketing must identify those factors that are critical to quality (CTQ) throughout the organization’s value stream.

4. Marketing people must be able to provide the link between value information from the marketplace and those inside the organization, which create and deliver value. This is a critical process as it helps in identifying the Six Sigma projects. Project that will link the organization’s processes (inputs) to competitive performance criteria associated with the CTQs (outputs). Your company must use the tools used that will identify these linkages for you to be able to prioritize your projects.

5. Once you have launched your Six Sigma projects, you must develop appropriate tracking metrics to monitor market-perceived changes in value based on changes brought about through Six Sigma projects. Black Belts are expert at the identification and use of appropriate metrics for tracking internal process changes. Marketing should partner with Black Belts to identify and use appropriate metrics to track changes in market perceptions.

Based on these points, marketing function has been systematized by Six Sigma. It is no longer enough that marketing people do market research and report it during management committee meetings. The data they gather must be something useful for improvement processes.

Source: Marketing Function Is Different in a Six Sigma World.

Found the link on: Promax Consulting website.

Filed under: Six Sigma Organizations, Team Dynamics

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Six Sigma Metrics

The premise of the Six Sigma methodology is to reduce the output variation to satisfy customers. For a million opportunities, the target result should be 3.4 defects. To determine this number, you need to have some metrics or a system of measurements. The basis of Six Sigma metrics is the measurement of number of standard deviations between the baseline (which is the mean of processes) and customer specifications.

Some of the Six Sigma metrics are Process Capability Indices (Cp, Cpk, Cpm), Parts-Per-Million (PPM), Defects-Per-Million (DPM), and Defects-Per-Million-Opportunities (DPMO).

Just how important are metrics to your Six Sigma effort?

Read the interview with David Henkin, President of Vanguard Group. On isixsigma.com he talks about how successful companies make use of these metrics and be beneffited by them. Here are excerpts from that interview.

Classical measures of quality such as timeliness, accuracy, ease of doing business and cost are important and often abundant on most companies’ Six Sigma measurement framework. Other typical Six Sigma measures such as rolled-throughput yield, sigma and DPMO tell a good story, when applied properly. Companies that are successful with Six Sigma tailor metrics to align with core processes and its critical-to-quality (CTQ) characteristics. Understanding clients’ CTQs and ensuring they are measured and addressed are paramount. Another element of success is ensuring measures are “leading” rather than “lagging.” Leading measures focus on the process, its inputs and suppliers, whereas lagging metrics focus on results or outcomes. Ultimately, the truly successful companies understand the cause-and-effect relationship between the leading and lagging measures.

…

Consolidating Six Sigma metrics with business metrics is an exercise in change management. The saying “never solve a problem before its time” applies. Forcing a business (and its culture) to change to a new set of metrics can lead to resistance.

So what to do? Effectively managing a continuous improvement initiative, such as Six Sigma, will produce a waterfall effect on metrics by not only identifying new ways to consider and measure what’s important to the business, but also creating better data the current business metrics are based on.

Read the whole interview.

Read also about Six Sigma metrics and how to devise them.

Filed under: Tools/Toolkits

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