Why Six Sigma is not complete without BPM
Six Sigma has become a very popular approach for process improvement. The result-oriented, fact-based and rigorous approach of Six Sigma has much to offer. However, without applying the broader principals of the Business Process Management approach the benefits of process improvement for an organisation cannot be fully realised.Background on Six Sigma
Sigma is the Greek letter which is used in statistics to measure how far a given process deviates from perfection. Six Sigma means a failure rate of 3.4 parts per million or 99.9997 perfection. The objective of Six Sigma is to improve profits through defect reduction and improved customer satisfaction. It involves a systematic and analytical way of identifying, anticipating andsolving problems and has been used by many organisations. Motorola developed the Six Sigma methodology in the mid-1980’s and it was initially used in the manufacturing industry; however, nowadays it is also being applied in service organisations (e.g. financial institutes).
Steps of Six Sigma:
The Six Sigma methodology comprises 5 steps: • • • • • Define – determine the intended improvement,provide a high level model of the process and identify what is important to the customer Measure – provide baseline data on the current process performance, identify problem areas and develop a focused problem statement Analyse – perform root cause analysis of the identified problems and validate these with the data and provide tested solutions Improve – pilot and implement the suggested solutionswhich should eliminate or reduce the identified root cause Control – evaluate the implemented solution and the original plan. Ensure sustainability of the solution by embedding the solution in the standard procedures of the organisation.
Six Sigma concepts:
The following concepts are fundamental to the Six Sigma approach (www.ge.com accessed on
15 August 2005) and are critical to Quality:• • • • Attributes most importance to the customer Defect: Failing to deliver what the customer wants Process Capability: What your process can deliver Variation: What the customer sees and feels
Stable Operations: Ensuring consistent, predictable processes to improve what the customer sees and feels Design for Six Sigma: Designing to meet customers needs and process quality.
Lean processing aims to achieve continuous improvement and customer satisfaction. It aims to achieve perfection and targets the reduction in waste, lead time and costs, while being able to deliver on-time quality goods.
When to use Six Sigma?
• • • • • • When process problems are common place and not well defined Unknown causes of process errors In complex situations with many variablesWhen NOT to use Six Sigma:
Six Sigma requires commitment from the top of the organisation and unless this is available, it should not be used Six Sigma requires a significant investment in training and the subsequent program, if such funds are not available it is no use trying to do ‘half’ a Six Sigma implementation In the case where fundamental or large scale changes are required to addressone or more end-to-end process.
Six Sigma and Business Process Management
As outlined above, Six Sigma is a useful and rigorous approach to improve quality. However, Six Sigma only addresses a portion of the components required in a business transformation or improvement project as it , and does not provide the tools and methods of moving towards a process-centric organisation. Six Sigma isnot a subset of BPM, it is a useful adjunct. For example, “it does not have a sophisticated tool kit to document processes in standard forms, or to build process models that are easily translatable into IT implementations” (Garimella, 2005) The main issues missing are: • the alignment with Organisation Strategy. Our experience has shown that it is crucial to ensure that the strategic objectives...