Process Improvement and Process Creation Business Impact
SBATX uses Six Sigma and Lean Six methodology to improve offerings and customer satisfaction, sales, and reputation.
The quality of your products or services is important to your customers, as is the delivery of it. Defective goods, failures in service, shipping to the wrong addresses, delays in fulfillment, and other failures to meet consumer expectations of your company can drive your sales to the competition and damage the reputation of your company. These problems are known as defects and reducing them is the goal of Six Sigma, which measures your business processes in terms of a Sigma Level, 1-6, measuring the amount of expected defects per million opportunities (DPMO).
- 1 Sigma = 690,000 DPMO, or a 69% defect rate
- 2 Sigma = 308,537 DPMO, or ~ 31% defect rate
- 3 Sigma = 66,807 DPMO, or ~ 6.7% defect rate
- 4 Sigma = 6,210 DPMO, or ~ 0.62% defect rate
- 5 Sigma = 233 DPMO, or ~ 0.00023% defect rate
- 6 Sigma = 3.4 DPMO, or a 0.0000034% defect rate
The improvement process, known as Six Sigma, or DMAIC, begins with the Define Phase, where the problem is bounded in scope, scale, the nomenclature is agreed upon, and the stakeholders and team are selected. Next is the Measure Phase, where process creating the defects is mapped out from Supplier to Input, from Input to Process, from Process to Output, and from Output to Customer, along with all the known factors affecting this process. Additionally, the Sigma Level for the Process(es) is assessed to determine how bad the problem is. Afterward, the Analyze Phase examines how each factor affects the final outcome of the process to figure out which one has the greatest impact. Proceeding to the Impprove Phase, a set of possible solutions to the factors causing problems are proposed, examined for cost to projected benefit, and one or more are chosen to be put into place. Finally, the solution is monitored in the Control Phase over time to ensure that the implemented solution(s) are having the projected effect upon the Sigma Level.
The steps to creating a process from scratch that will please customers, known as Lean Six, or DMADV, similarly begins with the Define Phase, where again a charter is created to bound the need in scope, scale, nomenclature, team, and stakeholders. The Measure Phase then evaluates specific metrics that must be met in order to create a successful process. From there, the Analysis Phase projects the quality of the process, makes adjustments based upon available data, and maps out the value-adding steps. The Design Phase takes the results and tests the new process to see if it adequately meets the metric specifications. If it does, then the process is put into place in the Verify Phase, and the real-world results are continuously monitored to in order to make any necessary adjustments.
SBATX has used Six Sigma and Lean Six methodology to generate over $4M for clients in validated budget line-item operating income improvements. Our Six Sigma Black Belts can create, improve, document, lead, and train, every step of the way, to ensure your business is delivering the best quality to its customers.
Six Sigma Process Improvement (DMAIC)
The average cost of poor quality to a company to its revenue is 15-20%, according to Burge Huges Walsh. Mistakes costs money, time, and customer loyalty, all of which cut into your bottom line. For instance, the Six Sigma process at North Shore was able to lower customer wait times at by 37% according to Villanova University. That 37% improvement was not just a matter of improving customer satisfaction, but staff efficacy and throughput. What would increasing your ability to fulfill orders by over a third do for your company?
In some industries, it can even mean the difference between life and death for yourself, your employees, or your customers. Hopkins Medicine reports that medical errors account for 10% of deaths in the United States, or about 250,000 lives per year! Even if your company is not healthcare related, the reduction of risk to life and limb is paramount when it comes to your business processes, and emotional considerations aside, the cold math means resulting lawsuits and fines from failures could bankrupt your business,
SBATX can help to ensure the safety of your employees and customers, as well as improving the health of your operating income by removing defects from the process.
Lean Six Process Creation (DMADV)
As the saying goes, “that which does not get measured, does not get managed. That which does not get managed does not get done.” When your business processes are designed with adequate metrics, the ability to measure them, and the accountability to achieve them, not only can problems be solved before they occur, the ability to correct them is faster and less expensive.
A study by the University of Strathclyde showed that logistics problems at one company decreased errors from 17.6% to 7.4%, with the results amounting to over $400,000 in increased market share in addition to the customer satisfaction and word of mouth that comes from such improvements.
SBATX will work with your company to design a process that will meet customer expectations, with realistic, attainable, and measurable metrics, as well as provide the tools to monitor the achievement levels of those metrics to ensure your company is proving the best possible goods and services.