Why Is Six Sigma Important?

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Six Sigma turns management into a science, offering data-driven tools for analyzing and improving processes. It takes your business miles beyond the uncharted and intuitive approach that may work for a startup but can prevent a business from fully maturing. Six Sigma certification requires an investment of time and money, but it improves your quality and productivity in ways that provide lasting benefits.

TL;DR (Too Long; Didn't Read)

The importance of Six Sigma lies in its capacity to bring a formal, tested methodology to management and manufacturing.

Six Sigma Steps

  • Define. This step consists of creating parameters to set the scope of a project, laying out what you intend to do, how you intend to do it, when you expect it to be completed and which tasks lie outside the purview of your current objectives. This definition stage may also include a budget, customer needs and the overall purpose of the endeavor.

  • Measure. This phase of the process is an opportunity to assess your organization's current capabilities to provide a baseline for measuring progress as you improve. It may include measuring your production capacity as well as other metrics such as level of waste or rate of customer returns due to malfunctions or irregularities.

  • Analyze. This process involves taking a close look at the information you gathered during the measurement stage with the objective of charting a path for improvement. If your productivity numbers aren't what you'd like them to be, the analysis stage provides the opportunity to ask why your operation is underperforming and to set goals defining the improvement you'd like to see.

  • Improve. In the improvement stage, you and your staff make tangible changes to implement the changes you've laid out in the course of your analysis. This is where you do the work, make adjustments and gather a new set of data about what works and what doesn't.

  • Control. The improvements you made during the current phase of your organization's improvement cycle will provide lasting benefits once you take the final step of standardizing them or making them into controls. This involves documentation of workflow and results and setting a new baseline for future improvements.

Benefits of Six Sigma

Six Sigma is a tested and teachable process for doing better work. It improves the quality of your products, increasing customer satisfaction and increasing sales through retention and referrals. It also makes your business more profitable by improving efficiency and reducing waste as you evaluate and improve your processes. The process of quantifying these aspects of your operation allows you to see measurable results.

Implementing a Six Sigma process can also improve employee engagement. If your employees are involved in the improvement process and see real results from their work, they are more likely to stay interested, bring their best to the workplace and stay with your company over time. They are involved in ongoing learning, which motivates them and contributes to overall morale.

Six Sigma and Lean Manufacturing

As an approach to improving productivity, Six Sigma uses the lean manufacturing philosophy popularized by Toyota and other successful companies. Lean manufacturing is based on reducing inventory levels that can bloat budgets without increasing actual cash flow and profitability, reducing bottlenecks that slow down work flow and improving the throughput cycle between receiving and delivering an order.

While traditional accounting systems list inventory on the books as an asset, lean manufacturing rethinks this assumption and instead focuses on the benefits of keeping your cash liquid rather than tied up in materials or finished products that you may not sell soon. This lean inventory approach also helps you to target production so you're directing company resources more effectively toward the work that is most likely to bring in necessary cash.

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About the Author

Devra Gartenstein founded her first food business in 1987. In 2013 she transformed her most recent venture, a farmers market concession and catering company, into a worker-owned cooperative. She does one-on-one mentoring and consulting focused on entrepreneurship and practical business skills.

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