Six Sigma: Steps, Applications, Principles in Management

In India, the MBA graduate employability has sharply risen from 47% in 2021 to 60% in 2023. So, if your dream career is in management, now is the right time to give it a start. Before diving into a management career, knowing about the industry's key concepts or terminologies is a wise move.

Such a knowledge base ensures the attention of your potential employers. It further widens your scope to bag a job with handsome remuneration. One such important concept is ‘Six Sigma’. It is a methodology used to enhance production, developed by Motorola in the 1980s. By bringing in Six Sigma in the production and management process, the companies strive for better operation and deliver high-quality products.

Here’s a guide on what is Six Sigma, Six Sigma methodologies, lean Six Sigma and much more.

Six Sigma: What is it?

Six Sigma is a bundle of tools and methodologies that helps organisations improve their production process. It aims to minimise errors and defects by decreasing variation and improving quality. ‘Sigma’ denotes a statistical tool measuring deviation from the normal or mean.

In Statistics, bell-shaped curves represent sigma; a single sigma is synonymous with a single standard deviation from the normal. Thus, if the representation has six sigmas, with three beyond the mean and three under it, then the process has extremely low defective rates.

What is Lean Six Sigma?

Lean Six Sigma methodology aims at performance improvement through waste and defect reduction. It couples the lean manufacturing philosophy with Six Sigma tools. The main focus of ‘lean’ is on subtracting wasteful activities, while the Six Sigma approach focuses on quality improvement by eliminating defects.

It is based on the idea that any resource which doesn’t add value for the customer is a waste. Thus, such resources must be eliminated. The lean Six Sigma tools are the same as Six Sigma tools, which you can explore in the next section.

The core steps of Six Sigma

The Six Sigma methodology goes through five stages, according to the acronym DMAIC. It stands for Define, Measure, Analyse, Improve, and Control. This data-driven process aims to optimise and improve business productivity.

Define

Define is the first stage of Six Sigma, where you collect all the vital information required to chop down any problem, process or project. This customer-oriented approach defines the problem and breaks it into small actionable bits. The ‘Define’ stage examples are budgeting, driving motivation, preparation of project timeline, etc. Define stage follows the given steps:

• Step 1: Defining the issue from the client's perspective
• Step 2: Goal setting. Here the business managers ask questions like ‘What should we aim to achieve?’ or ‘What resources should we use to fulfil the goals?’
• Step 3: Process mapping assures the clients that the organisation will complete the project on time.

Measure

In the second step, ‘Measure’, the companies assess their present processing capacities. In this step, the organisations figure out the areas of improvement. The companies must identify the nature of available data and its source to improve the production process. With this data, the companies summarise the problem and finalise their areas of improvement. The Measure stage follows the given steps:

• Step 1: Determining how the current processes are performing.
• Step 2: Curating a data collection plan.
• Step 3: Collection of baseline data.
• Step 4: Measuring the problem against this reliable data.
• Step 5: Evaluate the final measurement system and whether it can help you achieve your goals.

Analyse

Analyse is the third stage, where the companies examine or analyse the collected data. This stage helps to extract the main causes of defects and discrepancies in production. In this step, the Six Sigma teams use Pareto charts, and data maps, which help mark the defect frequency. Analyse stage follows the given steps:

• Step 1: Observe the processes.
• Step 2: Displaying the data with graphical tools.
• Step 3: Finding the problem source followed by verification
• Step 4: Quantification of your potential goals in numerical. For example, increase effective products by 15%.
• Step 5: Using historical data to highlight the variations.

Improve

Improve is the fourth stage, where companies must select a solution for the crisis. The solution depends on the nature of the problem, and the companies have to approach the problem with a refined mindset. Many companies keep a series of potential solutions and then sort one out by considering the client's requirements. This stage follows the given steps:

• Step 1: Collaborate with the team members to find the ideal solution.
• Step 2: Ensure the practicality of the solutions.
• Step 3: Select the most acceptable solution and implement it.
• Step 4: Quantify the improvement.

Control

Control is the final stage in the Six Sigma methodology. In this stage, the companies employing Six Sigma methodologies design a control plan. It further ensures that the teams follow a standardised production process. This plan provides the draft for daily work and acts as a correction and prevention measure before defects reach end products. Thus, this stage ensures that client goals and customer goals are fulfilled. The control stage has steps like:

• Step 1: Management and control of the production process.
• Step 2: Keep track of the changes in the process.
• Step 3: Incorporate the improvements.

The Six Sigma principles

Six Sigma methodology works on the following principles:

Focused on customer requirements

Six Sigma focuses on quality improvement and defines quality based on the customer’s perspective. It focuses on the parameters that are important to the final consumers.

Identifying causes behind problems

Six Sigma identifies the causes behind problems through a complete process overview. This understanding includes how the process was meant to work and how it is really working.

Neutralising variation

Once Six Sigma identifies the causes, it focuses on eliminating or neutralising the variations. Thus, it ensures that defects are entirely removed from the process.

Flexibility and thoroughness

To ensure the perfect product quality, flexibility to incorporate changes after identifying the faults is vital. Thus, the team should be aware of possibilities and open to change adaptation. This methodology demands thorough problem-solving. Thus it ensures that modified processes are working properly.

Teamwork

Teams and team leaders are a critical part of the Six Sigma process. These team members must have training in Six Sigma methodology and be willing to work together towards a common goal.

Six Sigma applicability

Businesses apply the Six Sigma strategy to improve product quality and fine-tune their services. This includes the production of the product, its development, sales, marketing etc. Industries like telecom, information technology, marketing, human resources, aerospace, healthcare, and retail all use Six Sigma methodologies to curate top-quality products.

What career choices does Six Sigma offer?

A range of industries incorporate the Six Sigma strategy, and today, it has opened new job opportunities with good salary prospects. Here are your top career choices:

• Six Sigma Consultant - Responsible for advising the organisations on what improvements to incorporate; these consultants also help in cost savings, developing strategies, etc.

• Quality Managers - In charge of quality control. These managers ensure that end products are to the choice of the consumers, meet industry standards, complying the regulation requirements etc.

• Six Sigma Project Manager - The manager for all Six Sigma-based projects. They have to oversee the team, ensure improvements are implemented, and likewise.

Conclusion

Now that you know one of the most important concepts in management, Six Sigma, it is time to explore your dream course. Amity University Online is a platform offering various courses to provide the best possible learning outcome.

The Master of Business Administration course is perfect for you to enrol yourself before setting foot in a management career. This course is paired with a robust LMS or Learning Management System, offering a personalised learning experience. You can opt for the online MBA programme as it offers you flexibility in learning. This popular choice also offers tons of career growth. Explore Amity University Online and enrol yourself now!