Hackett Research Has New Findings About Six Sigma

Many times, we are told that Six Sigma may or may not solve all your process improvement problems. It’s true. The success of Six Sigma projects depend on a lot of things. There are essential Do’s and Don’ts of project deployment. You can also check my notes on The Six Sigma Way for some guide on deployment.

That is why when Hacket Group finds out that Six Sigma is not a silver bullet for back-office improvements, I know it can be true. Six Sigma is a step by step process, and the changes are incremental. It does not spell overnight success. DMReview reports:

Many Hackett clients find Six Sigma to be a powerful tool for incremental improvement. Using a combination of Six Sigma and LEAN, one U.S. client was able to achieve major progress in accounts payable, including a 50 percent reduction in payment processing time, largely by identifying errors and eliminating nonvalue-added activities. At another Hackett client, Six Sigma played a key role in their ability to decrease cycle times and reduce costs as they built a global shared services organization. Overall, Hackett’s research shows that 86 percent of all finance shared services organizations have a strong commitment to continuous improvement programs such as Six Sigma.

“Six Sigma can enable companies to generate incremental improvement spanning both efficiency and effectiveness performance across the back office. But it’s not a silver bullet, and only works in the right circumstances. It is a demanding discipline that must be used carefully,” explained Hackett President of Global Enterprise Solutions Richard T. Roth. “While Six Sigma is useful for making incremental improvements, it’s not the best tool when the goal is broad transformational change. It’s like using a screwdriver to make a structure more stable when a hammer is required. Increasing efficiency by $60 million per billion in revenue does not take place through small, incremental improvements. Some executives will find that their problems are simply too endemic to be addressed by Six Sigma alone.”

Care to share your thoughts on the second paragraph?

Source:
DMReview, Hackett Research: Six Sigma Not a Silver Bullet for Back-Office Improvements. Link provided by Six Sigma Zone.

*Photo credit: MorgueFile.com

Filed under: Deployment, Six Sigma References

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Six Sigma Round-up

Today, I made the rounds of Six Sigma blogs to know the what the other blogs are saying about Six Sigma, Lean Six Sigma, or other quality strategies.

Over at iSixSigma Blogosphere, Sue Kozlowski plans to write a book, which she will title The 27 Lean Six Sigma Leadership Secrets of Abraham Lincoln: Uniting your organization to a common purpose. Sue shares her remarkable observations of how management and leadership books are titled: some number and, to use her term, leadership-oriented nouns. I say go for it, Sue!

Six Sigma Blog reminds us what Six Sigma is: a disciplined, data-driven approach and methodology for eliminating defects in any process. Failing to understand the concept of Six Sigma, an organization cannot begin to work toward near perfection, or so it says. Well, Six Sigma does not necessarily promise perfection at the end. Instead, it promises continuous improvement. An organization becomes aware of its processes, the defects, and will be on the look out to improve every non-comformant along the way.

Lean Six Sigma Blog poses the questions: Why do Lean Six Sigma consultants continue to deliver training using an inflexible batch method that also carries the highest cost? Shouldn’t Lean Six Sigma methods be used to deliver Lean Six Sigma training? There’s a point there. There is an underlying issue on which method is more effective and less expensive, online or classroom training. Espousing on lean, these trainings should be streamlined (i.e., be lean) to get the most out of one training.

And for some Six Sigma statistics, Quality Hero is giving a sample t-test. It is simply presented and explained that renders the information very useful.

Filed under: Data, Lean Six Sigma, Six Sigma References, Statistics, Training

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Six Sigma Blog Feature: iSixSigma Blogosphere

Today, I’m starting a new weekly feature here on SixSig, where I will feature blogs that touch on quality management methodologies.

What better way to start this than featuring my favorite Six Sigma blog: iSixSigma Blogosphere. They have 18 bloggers all of whom are Six Sigma practitioners and belters. Each write about all aspects of Six Sigma, Lean Six Sigma, Quality, Management, Leadership in various industries. Each has been invited to speak, done relevant research, and wrote excellent papers. In other words, all of them know what they’re talking about.

Despite that, they write so well, so fluidly, without the gobbledygook that is often associated with technical or business writing. Their materials are easy to read and understand, and with the right sense of humor. I salute you guys, and keep up the good work!

Filed under: Six Sigma References

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Six Sigma Saves the Fortune 500 $427 Billion

About nineteen years after Motorola introduced Six Sigma as a methodology to improve processes by eliminating defects, Six Sigma is still alive and benefitting companies all over the world.

iSixSigma Magazine‘s latest Jan-Feb 2007 issue features Six Sigma helping Fortune 500 companies to save $427B. Michael Marx, iSixSigma research manager points out the following:

• corporate-wide Six Sigma deployments save an average 2 percent of total revenue per year
• about 53 percent of Fortune 500 companies are currently using Six Sigma, and that figure rises to 82 percent with the Fortune 100
• the market for Six Sigma training and consulting is still very much open, referring to the 47 percent of the Fortune 500 that have not yet embraced the methodology

As Michael Marx said, this should stop some quarters who are still harbor disbelief that Six Sigma actually works.

Source: iSixSigma Magazine, Six Sigma Saves Fortune 500 $427 Billion

Related Story: SixSigmaCompanies.com, Six Sigma Saves the Fortune 500 $427 Billion

*Photo credit: BBC.com

Filed under: Benefits and Savings, Fortune 500 Blog Project, Six Sigma Organizations

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An Update on “Six Sigma not panning out as promised” at Home Depot

In my previous post, I mentioned that what’s happening at Home Depot these days may be attributed to Six Sigma not delivering on its promise to improve processes and increase bottomline.

Andrew Downard of iSixSigma blogosphere presented sides of the story. I tend to agree with him that “correlation does not necessarily indicate causation.” Read his take on “Reports of our Demise.”

Filed under: Benefits and Savings, Retail, Sales, Six Sigma Organizations

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Six Sigma on Software Implementation

Last Christmas break, my niece was telling me about her team’s software project launching last June. It was an enrollment software program. The first day was a riot! Programmers would all probably agree that you cannot predict all the possible bugs there will be during run time.

Common challenges during software implementation are delays, cost overruns, and failures. The two most common causes of project failures as identified are not meeting customers requirements and estimating problems.

Gary Gack‘s article on iSixSigma discusses how Six Sigma can improve software implementation on those two accounts mentioned above:

Case 1: Understanding the Voice of the Customer. Know everything there is to know about your customers and their needs, and learn from it. You can do this by: knowing the customer’s goals/business objectives and create a fact-supported basis for selection and prioritization of functionality to be delivered.

Case 2: Understanding Process Capability. Evaluate your team’s or organization’s readiness to do the project. Can you handle issues on your capability (does your team has the right experience?), the size of your organization (determines if you can afford to send people to train for Six Sigma and do the project, and are you supported by management that understands the timing or scheduling involved in the project.

Continue reading…

Source: iSixSigma: Applying Six Sigma to Software Implementation Projects

Related article: Lean Six Sigma and Cycle Time

*Photo credit: Morguefile.com

Filed under: Deployment, Software/Technology, Tools/Toolkits

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Six Sigma in the Asia Pacific

From May 22 to 23 this year, the 8th Annual Asian Six Sigma Summit 2007 will be held at Raffles The Plaza, Singapore. The Summit focuses on innovation, challenging all organizations to leave the old and embrace the new way of doing things.

The Summit will also highlight Six Sigma in the Asia Pacific. The last time we checked there are about 14 Six Sigma organizations in the Asia Pacific. I’m sure this number has increased.

Over at IQPC, Robert Dawson, Principal Director, Office of Information Systems and Technology of ADB, and the Summit’s speaker, shared his thoughts on the current state of Six Sigma in the Asia Pacific, how Six Sigma evolved in the region, and its future.

What is the current state of Six Sigma in Asia Pacific?

Six Sigma – based on my contacts – is growing very fast in the Philippines – which is the only place I can talk about at this time. The growth in call centers has raised the need for substantial process reviews and therefore Six Sigma is being used. Six Sigma however is being introduced to specific service areas, not highly technical areas such as software development and the like in the Philippines.

Six Sigma has a good “name value” at present and there is a need to get a lot more people involved in the consulting and training area. Having a university run courses – or incorporate units into their ongoing courses – would seem to be a good way of building up the people who can participate in the region.

Continue reading…

Further, in the region, what’s new for 2007 will be the Asia Pacific Six Sigma Excellence Awards! Submit your nominations now!

Filed under: Awards, Events/Announcements, Interview, Six Sigma Organizations

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Six Sigma Improving Customer Service at Heritage Valley Health System

Lousy food or lousy hospital service?

Well, not at Heritage Valley Health System, particularly Beaver and Sewickly campuses.
Six Sigma methodology has streamlined their operations, and is making sure it remains that way. A year after implementing Six Sigma, Heritage launched Lean Six Sigma to further improve processes. Here’s an outline:

The problem: Serving food to patients is beset with delays and still follows the decades-old tray-line system, wasted trays, and wasted food.

The methodology: Six Sigma, then Lean Six Sigma

The solution: Provide room service

The result: increased patient satisfaction and an estimated $40,000 per year savings in cost.

Source: Heritage Valley Health System link provided by iSixSigma.com

Filed under: Benefits and Savings, Healthcare, Services, Six Sigma Organizations

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American Standard Circuits: High on Six Sigma, High on Quality

Every time I’m faced with a company that is high on quality, I can’t help being awed. Here’s a company who’s serious about the business, and cares about its customers, both internal and external.

Is there such a company? Maybe. Of course there’s no perfect organization, but it’s a good start if management and everyone in it believes in Six Sigma or any other quality strategy.

When I read about American Standards Circuits and its team of Six Sigma professionals, I knew the company is heading in the right direction. Not only is the company investing in Six Sigma training, its divisions are ISO 9001-2000 and QS9000 certified. The company, too, has a history of innovation and has successfully interconnected electronics with its operations.

No wonder the company has been enjoying success through the years. RFGlobalnet reports:

After a history spanning 17 years, American Standard Circuits is now rapidly emerging as a leading manufacturer of advanced circuit boards, heat sink circuits, and microwave pcb’s / printed circuit boards & high frequency PCBs in the US and India. We do not regard expansion as a goal in its own right – it should meet the needs of the market (and hence the user) in terms of quality, speed and quantity.

Source:
RFGlobal Net, link from SixSigmaZone.com.

*Photo credit: MorgueFile.com

Filed under: Benefits and Savings, Manufacturing, Six Sigma Organizations

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Six Sigma at Home Depot

Perhaps one of the biggest news that opens 2007 is Robert Nardelli’s, Home Depot‘s CEO, departure from Home Depot. Viewed as among the highest paid CEOs in the world—and at the helm of the world’s largest home improvement retailer no less—his leaving may have come as a surprise.

When Nardelli came to Home Depot, he brought with him the exacting management and leadership style he learned from GE and Case Corp. He was already a Six Sigma guy. However, it took him three years after joining Home Depot to unfold the Six Sigma carpet so to speak. His reason was that (to use his exact words) he wouldn’t want to push the concept down everyone’s throats.

Eventually, Nardelli made Six Sigma became the formula for Home Depot’s success. Everyone was involved in ensuring efficiency of strategic processes: making the supply chain as lean as it can be, using scale to unseat competitors, leveraging IT to reduce costs, and finding the right marketing formulas. Its focus was on quality of human interactions. The 325,000 shop assistants interact with customers about 3 billion times per year, and often at a very personal level, helping them select items like kitchen sinks and toilets. Every month, the volume of activity rises. The retailer opens a new store every 48 hours, and receives more than 10 million job applications every year.

What went wrong, then?

A banner story on Wall Street Journal, Nardelli’s leaving Home Depot was also seen as a case of Six Sigma failing to put the company move forward and maintain the lead.

We may have to wait a few days to know the full story.

Sources:
Strategy+Business: Winning Hearts and Minds at Home Depot
Wall Street Journal Online: The ‘Six Sigma’ Factor for the Home Depot

Filed under: Human Resource, Retail, Six Sigma Organizations

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