How Applying Six Sigma Tools Could Help Your Business

It does not matter whether your company is small, medium or large. There are a number of benefits of applying suitable Six Sigma Tools on certain processes or systems at your company.

Some of the possible benefits of the Six Sigma process are overall reduction in business costs, overall quality improvement of products or services and even acquisition of more customers for your company. Some people mistakenly believe that the methodology is aimed solely at manufacturing companies. Similar to other quality methodologies like Total Quality Management or TQM, this particular methodology can be used to improve any company's business, immaterial of its nature of business.

There are scores of Six Sigma tools like 5Ws and 1H, Pareto analysis and business process mapping that can be applied to any particular process or system to monitor its progress, improve it and ensure its stability over time. As the saying goes, "Quality comes at a price". So, initially, a company may have to allocate some amount of money, time and energy to implement any of these tools. But, over a long period, this initial investment of money might prove to be very worthwhile.

It is not necessary to hire an expert to provide guidance or implement the necessary tools. Consider enrolling one or more of your employees in Six Sigma Training. There are many different levels of certification including Yellow Belt, Green Belt and Black Belt. In order to have the full in-depth knowledge about how to implement this methodology, an employee should go through a Black Belt certification program.

Such a program may prove to be costly; however, if the person finishes the certification program successfully, he or she can train other employees on the core concepts of this very methodology. It is not necessary to conduct an onsite training to certify a group of employees as Black Belts. This type of training can be very expensive and not cost effective.  It may prove to be easier and more cost-effective to send one employee for Master Black Belt Training, who could then report back and train the others in the theories of Six Sigma.

Training one employee might suffice for training others or being a leader for the implementation of this methodology for the company. To assist the person in coordinating and implementing the process, consider sending a few employees for the Yellow Belt or Green Belt certification programs. Yellow Belt is at a lower level than Green Belt. Therefore, those who attend the Green Belt certification program learn more compared to Yellow Belt certification attendees.

In the case of those who have Yellow Belt or Green Belt certifications, their focus can be divided between their daily work and implementation of this methodology.  The Black Belt should preferably focus entirely on the coordination and implementation of Six Sigma methodology in the company. Then, there are higher chances of successful coordination and implementation, resulting in the expected benefits.

In short, immaterial of the size of the company, using appropriate 6 Sigma Tools such as business process mapping on specific processes can give many benefits. It is possible for the company to experience lower operational costs, better quality services or products and an increase in the number of sales. The nature of the company's business does not matter for Six Sigma to be successful.

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Understanding the Concept of Supply Chain Management

Supply chain management is the process of maximizing added value and reducing the total cost across the entire trading process. It focuses on speed and certainty of response to the existing market. Because of ICT and globalization, this concept is increasingly becoming a powerful tool for most companies to compete at the local and international level.

The concept of supply chain management has become an important necessity for the manufacturing sector when it comes to delivering goods at a competitive cost and at a higher quality. The business environment today has changed quite significantly and it is becoming more competitive, perhaps due to the unsettling economic environment as of recent.

Enterprises these days need to operate at a reduced cost to compete. They must also develop their own core competencies that will distinguish them from their competitors and help them to stand out in the industry. In developing this competitive edge, businesses will be required to divert their resources to focus on what they do best. They will also need to outsource the processes and tasks that are not important to the overall objective of the business.

This concept has allowed most businesses to go back to the drawing board and rethink the whole operation. They must restructure the plans so that they can focus on core competencies and outsource those that are not within this scope. Because of the current competition in the market, this is the only way the businesses will survive the tides.

This tactic of applying supply chain management will have a positive effect on market positioning and on the strategic decisions of selecting the appropriate manpower, resources, and partners. Placing focus on key strengths will enable a business to build a niche for themselves and specialization of key areas within an industry. In order for this to happen, the businesses must look at the bigger picture of the entire process and figure out which one can be reduced, eliminated, raised, or created.

Companies are increasingly looking at foreign markets for growth prospects and suppliers from the same markets for improved opportunities. These are opportunities that present in many different ways. As they enhance their participation in this international economy, it becomes more important to develop and understand this concept and the opportunities that come with it.

Supply Chain Management is widely viewed as among the most crucial pushers for trade and industry. Many factors have resulted to increased world industrialization. The result of this is the competitive atmosphere which has changed drastically. These movers are decreased tariffs, improved transportation and communications, IT, globalization of goods, markets and services, and economic regionalism, among others.

The supply chain management techniques and tools are believed to be the main instruments that will enable a company to counter the environmental changes faced within today’s economy. A company that works closely with chain partners will better understand the changes the customers want and understand how to respond to them. It is also important to share risks so that they can derive ways through which they can enhance their own performance in this increasingly volatile business market.

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The Importance of Lean Six Sigma

When we talk about getting lean it is usually in regards to losing excess weight and strengthening a new body that is lighter and capable of doing more in an efficient way. The same principle applies when Lean Six Sigma methods are applied to business operations in the area of business management strategies. Simply put, this process is all about cost reduction and increased profits.

Founded by Motorola, USA in 1986, Six Sigma is a strategy that optimizes the process of outputting products and services by getting rid of errors so that results are always constant and always growing. Several quality management methods are used to achieve this, including methods based on statistics.  A unique infrastructure of people is created within an organization linking together people who are experts in this field. Projects that are carried on in the organization are then done following a series of steps aimed at reaching pre-determined financial targets.

The term Six Sigma is one that comes from the manufacturing sector, in particular statistical modeling of processes involved in manufacturing. A sigma rating is used to indicate the yield of a manufacturing process. This rating is based on the percentage of products manufactured that have no defects. In a six sigma process, the manufacturing process creates products where 99.99966 percent are defect free, this is the equivalent to only 3.4 defects in every 1 million products created.

In the 70s, a senior manager at Motorola criticized the poor quality of products that were being manufactured. When reasons for this were looked into, a connection was discovered between raising quality and cutting costs. It was initially feared that raising quality would mean additional costs but that was not the case.  In fact, costs came down because there were fewer claims from buyers for replacement sets or for repairs to be done. Going forward, Motorola set out to achieve the goal of the program for all that it outputted. It was from here that six sigma became a term that described a benchmark for manufacturing processes. The term then became synonymous with maximizing output and minimizing costs in other businesses.

The objectives and goals can be broken down into a number of key principles. One is that it is important that efforts towards keeping output predictable and of consistently high quality must be continuous. Another is that business processes that will determine good and consistent results must be broken down into aspects that can be measured, analyzed, improved and controlled. The third is that everyone must be involved, from the employees who are hands-on in the manufacturing process to senior level managers.

While there have been other quality control and improvement strategies, the Six Sigma program is different for a number of reasons. One difference is that it has a clear focus on attaining financial results that can be measured and quantified. There is also great emphasis on support and leadership being offered by management.

The infrastructure is also different; there are Champions, Master Black Belts, Green Belts, Black Belts and other levels of Six Sigma Certification that keep workers aspiring to work towards attaining them. There is also a deep commitment to making decisions based on facts and figures that are verifiable rather than basing important decisions on guesses and assumptions.

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