Six Sigma helps streamline processes by identifying root problems and eliminating them. The IT sector can immensely benefit from the approach which makes teams more agile and prepares them to optimize their offerings in tune with the voice of the customer.

The use of Six Sigma in IT management can have far-reaching consequences, as we shall explain in this article.

Understanding Six Sigma Principles

Six Sigma is a process improvement technique that helps bolster quality by reducing defects, i.e. bottlenecks. It helps manage quality and works to reduce variations in processes. Originating in Motorola, the technique rapidly expanded to other domains and is now used worldwide. Six Sigma has its origins in the statistical symbol Green sigma, which stands for standard deviation.

It helps companies with quality management through a well-defined series of steps. Six Sigma includes a DMAIC workflow which includes defining the problem, measuring the current state of processes, analyzing the data to discover problems, improving the processes, and controlling future iterations.

Another method employed in the Six Sigma approach is DMADV, where Six Sigma professionals define the goals, measure project state, analyze the project and create designs to improve processes and shortlist the best one, design and test processes, and finally verify the design. 

Six Sigma in the IT Industry

Six Sigma is a set of tools and techniques which help businesses improve their processes. Six Sigma can improve reliability and speed of operations in the IT sector. The technique helps analyze setups in a consistent manner.

It often begins with a problem statement to understand the root issue and its causes. Six Sigma takes that as the input and works to eliminate the challenges in a systematic manner. 

DMAIC is often used in conjunction with the voice of the customer (VOC). The goal is to understand customer pain points and develop specific solutions, even if they involve the use of existing systems to meet customer expectations.

When using Six Sigma, it is important to leverage the experience of professionals who are trained in the methodology. You might also need to train your internal workforce to prepare them for what lies ahead. It’s a delicate balance as excessive training can actually do more damage than good.

It’s All About Quality

Six Sigma is a time-tested methodology that works in diverse fields including in the IT sector. Teams should strive to be as agile as possible and understand customer pain points to address them in the best way possible. 

Six Sigma uses the DMAIC methodology to first formulate a problem statement and understand the challenges at hand. Teams will then work to systematically eliminate problems and reduce defects in processes. This has a direct impact on improving quality, reducing costs, and bolstering efficiency. Six Sigma helps IT achieve higher customer satisfaction levels across the board.

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The Six Sigma Key Principles

• Focus on customer requirements: This can be an actual customer, or if you are applying the principles to a goal you want to achieve, it can be you as the customer.  For a business customer, you must define what quality is from the point of view of the customer. What is important to your customer when they purchase your product or service?
• Identify and understand how the work gets done: Use a value stream map to identify where waste is happening and help you see how the current process is working. For this, you need to collect specific data. To establish what type of data you will need, define the goal for this data. Once the data is collected, look for ways to improve the current process by finding the root cause of variation or waste.
• Manage, improve and smooth the process flow: Identity value and non-value steps in your processes. This takes constant monitoring since change is an ongoing evolution. Understand the non-value steps which create variation in your business process.
• Reduce waste and focus on value: This continues on what it takes to improve and manage your day-to-day processes. 
• Remove variation to stop defects: Which once again expounds on the improve and smooth the process flow, and reducing waste, thus non-value steps.
• Involve and equip others through collaboration, such as teams in the process.  
• Make the improvement in a systematic way using data.

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Every organization needs to meet the standards and customer expectations on quality, and this is particularly true of telecommunication companies. The competitive nature of a business is such that if the company fails to meet these expectations, often it will have an impact on sales and the company’s reputation. It is not enough for businesses to merely churn out products and services to address market demand, they must also ensure every point of the supply chain meets and exceeds set standards.

Quality can be compromised at many different points in the supply chain. This may include errors during assembly of components or mistakes on the product label. To maintain high quality throughout the supply chain, several methods have been proposed. The Six Sigma methodologies can be applied to uphold quality and reduce unnecessary costs.

What is Six Sigma?

This is a methodology that involves the use of statistical analysis to address shortcomings in different organizational environments from the services sector to manufacturing. Using these analytical tools, organizations are in a better position to pinpoint bottlenecks and eliminate supply chain inefficiencies and human errors.

Six Sigma is said to have evolved through the manufacturing industry after it was invented by Motorola and promoted by other companies such as General Electric. Motorola wanted to develop a methodology that coordinated a series of procedures, according to the Environmental Protection Agency.

The values, procedures, and techniques proposed by Six Sigma are captured in the acronym DMAIC (Define, Measure, Analyze, Improve, Control). This simply means that you need to define your objectives, then collect accurate information, use the information to make an objective analysis, work on improving the procedures, and ensure control is done by monitoring the processes and making the necessary modifications.

How Does Six Sigma Help In Telecom Manufacturing Operations?

Even though Six Sigma evolved through the manufacturing field, it has many applications, especially in the telecom sector. In this industry, it can be instrumental in identifying issues on time. For example, you may find that minimizing lead time could multiply the number of finished products you produce. Having identified the issues, you can use the data to improve your supply chain management program.

Which Top Telecom Manufacturers Have Successfully Utilized Six Sigma?

General Electric is the most well-known company that has implemented these strategies to improve its operations. According to the company, within the first five years of applying Six Sigma principles, they had saved over $10 billion. General Electric mainly uses these techniques to improve the company’s customer service experience. The company also finds these techniques fruitful in developing efficient and predictable systems that can ensure customers get consistent value and that the company meets its standards. This way, General Electric has been able to cut costs to the tune of billions, while providing customers with the highest level of experience.

What Are the Other Benefits of Six Sigma?

The Six Sigma principles can also help your organization use fewer resources, cut down on waste and make positive environmental improvements. The U.S. Environmental Protection Agency has stated that you can reduce the risk of defective products, which means that industrial waste is minimized. Defective products need to be repaired and replaced. Fewer defective products also mean that people will not be exposed to risks and accidents as a result of the defects.

Why Proper Implementation of Six Sigma Is Essential

There is no doubt that Six Sigma can go a long way in improving various aspects of your organization. If not properly executed, it could end up being an obstacle. One weakness of the methodology is that it is primarily data-driven, and may ignore how your employees feel. However, understanding these weaknesses can make it easier to prevent obstacles. One way to do this is to have a wide consultation with staff to keep tabs of the working conditions. The same should be done when evaluating customer experiences.

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Across a multitude of industries, many organizations around the world have adopted Six Sigma methodologies to their operations in order to reduce waste and make them more efficient. From government agencies to healthcare and even aviation, leaders have discovered that Six Sigma tools and techniques provide huge benefits to their organizations.

No matter the industry or field, all businesses and organizations have processes that are behind their day-to-day operations. If there is to be measurable and sustained improvement of these processes, then Six Sigma is one of the best ways to provide tangible results.

Although many people are unlikely to associate Six Sigma with academia, many institutions of higher learning around the globe, facing ever tighter budgets, are starting to realize the importance of the Six Sigma methodology.

Why Universities Are Adopting Six Sigma

Maintaining quality in the field of higher education has become an important issue because of the higher demands placed on institutions by stakeholders as well as the competitive environment that universities operate within. While Six Sigma has seen widespread and successful implementation in the improvement of product and service industries, it is a concept that has only recently been adopted by higher education institutions.

In order to gain an understanding of how Six Sigma can be implemented for the improvement of higher education processes and to achieve quality, there are a number of models offered. These include Six Sigma principles which include reduction of waste and improvement of processes, both of which are closely aligned with the university mission and related accreditation bodies.

The Six Sigma Process

Of the several different approaches used in the achievement of Six Sigma levels of quality, the Define-Measure-Analyze-Improve-Control methodology is the most important and lies is the basis on which the whole process is built.

• Define: This is the first step taken to understand the process in order to develop a high-level map of processes involved in higher education. From it, a cause-effect diagram can be constructed to help evaluate how input variables affect the output. Among the inputs include new first-year college students, high-school graduates and K-12 teachers. The customers may be any of graduate schools, employers and society in general.
• Measure: Within this phase, all of the measurements that are related to processes in the university are measured. Among the factors considered when measuring the success rate are retention rate of students, the graduation rate, as well as those employed in a field related to their academic degree following their graduation.
• Analyze: Following the development of a process map, the Analyze phase looks at the factors that result in poor quality higher education. Some of the sources that have been identified using Six Sigma methods include curriculum, students, teachers, the assessment methods and institutional shortcomings. Once the sources of defects have been identified, steps can be taken to improve the quality of education offered to students.
• Improve: In this phase of the Six Sigma methodology, solutions are found to remedy the causes of poor quality in higher education at the particular university. However, the improvements need to be made with due consideration to the needs and requirements of the students, their teachers and departments as well as institutions in charge of the curriculum.
• Control: The final phase requires that the changes and improvements made be institutionalized to ensure that the new or improved processes are sustainable. The main focus when looking to achieve quality education at universities is to ensure standardization of improved processes and fostering its adoption into the culture of the educational institution.

Conclusion

The key outtake from higher education should be the success of students through the provision of high quality education. The failure of a student who has been subject to the process should be considered to be a process defect. Defects are remedied by applying Six Sigma principles to every facet of the higher education institution including the staff, help desk, recruiting office, IT support and related colleges, among others.

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These Six Sigma principles can also be used as what we promise to do on our behalf to increase the likelihood of success in our business or company.

The 5 Six Sigma Principles

1. Customer Focus: This means customer satisfaction. Since the quality of the product or service is directly in line with your customers, they are the direct gage with the degree of quality you provide. Get their feedback on what is important to them and provide their requirements in your product or service. Happy and satisfied customers means a long future for your business.

2. Identify Root Causes: If something isn’t right, you need to find out why, and that entails understanding how a process is to meet your goals. The process for this is as follows:

• State the goals for data collection
• Identify what specific data is needed
• Make sure communication is clear by defining terms
• Use Voice of Customer (VOC) — surveys, interviews, observations, as well as one-on-one customer interviews.
• Once this data has been collected, it can be put through the Six Sigma tool, the 5 Whys line of questioning until the root cause of a variation is achieved
• Use a Pareto chart, which is a bar graph that prioritizes which factors are more significant

3. Eliminate the Variation: Do this immediately 

4. Work as a United Front: Teamwork is imperative to the success of Six Sigma. This means everyone should be trained and have the knowledge of Six Sigma methods of operations. Teams should have members with a variety of knowledge and skills that is related to the process to help identify variations.

5. Adaptability: Create a culture that accepts change readily.

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One such curious and powerful concept is the Taguchi Loss Function (named for Genichi Taguchi), which is used to assess the financial impact of deviating from the target or optimal performance level, usually set by the customer.

What does the Taguchi Loss Function measure exactly

One of the core assumptions of Six Sigma is that not allowing the outcomes of business processes to deviate from the target is bound to create value for the particular organization. As you drift away from the target, the performance of the process, product or service starts to degrade in the eyes of your customer.

When examining this concept, one can intuitively incur that there is going to be a correlation between not meeting the quality target and waste of resources. Of course, whenever resources are wasted and whenever the quality of the results from a business process is low, this is going to have some financial ramifications that can be interpreted as a loss. This is exactly what the Taguchi Loss Function measures and what it is used to represent graphically.

When the outcome of a business process is exactly as targeted with zero deviation, the Taguchi Loss Function also has a value of zero. As deviation increases, the loss incurred and measured by the function increases in a quadratic manner. Even deviation within the Six Sigma range incurs some nominal loss, and that loss does not appear suddenly at its boundary, but increases gradually with the increase in deviation.

If we use the image above, we see that the ideal orange has ripened at Day 5. This is where the customer is most satisfied (or least dissatisfied). If we move one day earlier or later, we start to incur some dissatisfaction, as it is no longer the best orange possible. Even if it is acceptable to sell an orange on Day 3 or Day 7, those oranges are not as good as Day 5 oranges.

Learn more about this example of the Taguchi Loss Function with oranges >>>

When is the Taguchi Loss Function useful

When a business decides to optimize a particular process, or when optimization is already in progress, it’s often easy to lose focus and strive for lowering deviation from the target as an end goal of its own. But whenever we are talking about business, the most important and the most fundamental metric is always the profit. In that sense, the Taguchi Loss Function can be extremely valuable, as it is a tool that can transform deviation from target to a value with a financial representation, which affects the bottom line directly. Going back to the orange example, the customer would be getting an orange with less value on Day 3 or Day 7, yet paying the same price as Day 5 oranges. This may lead to financial impacts of lost future sales or more customer returns.

This is why this tool is widely used when selecting business processes to optimize first. Applying the function allows for the managers and consultants to measure the financial impact that the planned process improvement would have for the organization. This means that every project can be evaluated with a specific value for its potential financial impact. which makes prioritization a much easier and more informed decision.

The most famous case of this concept in practice was Ford’s study of similar transmission parts manufactured by an overseas supplier (likely Mazda). They found that they had superior performing parts due to less variation, even though all parts were within specification limits. Note: you can skip ahead to 5:08 where they discuss the specific study.

A more general usage

Despite the fact that the Taguchi Loss Function in the context of Six Sigma is generally used to measure the correlation between process performance and financial loss, it actually doesn’t have to be limited at that. It can be used to measure and predict the resulting losses in a wide variety of other metrics like customer satisfaction, product quality and employee time utilization efficiency.

The Taguchi Loss Function is an invaluable resource when planning and strategizing. This is why it is not a tool that is utilized just by Six Sigma alone, but by a wide variety of other business process optimization methodologies like Lean and Lean Six Sigma.

What we find most valuable with Taguchi Loss Function is the concept and change in mindset that it brings. It helps people realize that variation has a financial impact, and a company should not be complacent with quality just because they are meeting the specification limits. As the video showed, reduced variation can be a competitive advantage in your industry!

How does the Taguchi Loss Function apply to your work? Add your comment below…

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