Posts Tagged ‘Six Sigma’

In this part of “Interrelationship Digraph: Demystifying Complex Relationships” video I explain how we can use the Interrelationship Matrix to reflect results of the Interrelationship Digraph. I also show how we can construct this matrix using Microsoft Office Excel through Conditional Formatting and the COUNTIF function.


Interrelationship Digraph or Relations Diagram is one of the seven Management and Planning Tools that helps us analyze the cause-and-effect relationships among different issues in a complex situation. It also helps us focus on vital few issues with highest priorities which makes this tool echo Pareto principle or the 80/20 rule in concept.

In this part of “Interrelationship Digraph: Demystifying Complex Relationships” video I explain the tool, its uses, and how to construct it using Microsoft Office Visio.

Prioritization Matrix is a decision making tool and is one of the seven management and planning tools used in Six Sigma and Quality Management in general. It is used to determine the best option to select amongst several ones based on specific criteria using numerical values.

Watch this video to know how to create the Prioritization Matrix with Microsoft Office Excel.

During the Define step of a Six Sigma project the project team needs to identify the problem or the opportunity that the project is intended to solve. Usually, there would be more than one potential problem that can be addressed in a Six Sigma project; however, not all of them would have significant improvement. So, the project team needs to filter out those problems that if resolved will result in huge improvement and positive impact on the bottom line, and this is what Pareto analysis is used for. 

Watch this video to know more about using Microsoft Office Excel to create a Pareto chart in a Six Sigma project.

As we are approaching 2010 end people have been very busy creating budgets and setting objectives for 2011. While I am confident there are a lot of organizations listing improvement projects on their priority lists to achieve their strategic objectives I feel skeptical about Quick-Win initiatives being within these lists. Those ‘tiny’ projects that would relatively consume little resources but would have significant impact on the bottom line.

A decision taken by top management to assign every team the mission of listing a few quick-win projects would probably be a breakthrough in cost-saving for the next year. Let’s not talk about long-term goals and the projects or programs required to achieve them, that in some cases are doomed to fail due to unstructured methodologies, lack of buy-in, overallocated or insufficient resources, etc. Let’s not drain our precious resources on unnecessary projects that can be replaced by simple, few-day ones that would triple the ROI and boost our morale. Let’s commit to things that everyone in the organization is able to do because it reflects common sense. Let’s start looking around for a few minutes every day and hunt down something to improve.

Despite the need to learn basic problem-solving techniques and being couched on team dynamics, continuous improvement remains something that can be initiated and adopted by every employee in the organization. All what is needed is a common methodology to adopt throughout the organization in tackling improvement projects. A framework that each team can tailor to its work. Then, sky is the limit.

Low-hanging fruits exist in all places, but they need someone to look at and reap. Walk in your Accounting team, for instance, you will probably find invoices being checked or reconciled manually or semi-manually. Why not train people to use a tool in their hands more effectively to achieve more accurate results with less time? Walk in your warehouse and check how inventory is being controlled. Is it done on paper? Can it be automated with some affordable tool, I’m sure there are many out there to use. Don’t forget the ergonomics side of your operations. Does your workplace area fit employees? Is it laid out well enough to spare them strains and injuries? Is the well-being of employees on your high-priority list? There are a lot to think about just in a few-minute trip in your workplace!

To keep control of your improvement ideas and to monitor how you perform against your improvement goals you need to have some metrics. I believe that some people get confused when they hear the term KPI (Key Performance Indicator). It is so simple, though. You need to have something to measure your performance against, which is a KPI. If you find out that verifying a supplier invoice takes an accountant 30 minutes and you need to reduce it to 10 minutes then you use the 10 minutes as your KPI. So, after improving the verification process you keep an eye on the achieved cycle time and compare it to your target (10 minutes) until you achieve it.

Human resources are the most valuable asset in an organization. Success improves employees’ morale as well as the bottom line. On the other hand, failure projects demoralize employees in addition to having lost money. In order to achieve successful projects we ought to give employees the sense of self-worth by engaging them in improvement initiatives, encouraging them to hunt opportunities for improvement, and winning their buy-in.

Best of luck and Happy New Year.

Joyce Wycoff in his book “Transformation Thinking” says:

‘When an organization commits to creating an environment which stimulates the growth of everyone in the organization, amazing things start to happen: ideas pop up everywhere, people start to work together instead of “playing politics”; new opportunities appear; customers begin to notice service and attitude improvements; collections of individuals begin to coalesce into teams’.

It is a prevalent practice in organizations that start Six Sigma initiatives to employ specialist Black Belts (BB) and Green Belts (GB) to manage the improvement process of the organization’s operations. While it is a good practice to adopt, it is not the most efficient and effective. Outside BB and GB individuals are expensive and will yield shorter-term benefits than if Six Sigma culture is instilled in the workforce itself responsible for the process under improvement.

The optimum approach to nurture Six Sigma in an organization is to consider all employees as potential Green Belts then select few to receive advanced training and become Black Belts. Most of employees are capable to be Green Belts. The goal should be to train them in three main areas: problem-solving techniques, continuous improvement models, and interpersonal and team building skills. Black Belts then can be selected and trained on further advanced statistical tools and techniques with more emphasis on team building, conflict resolution, coaching and mentoring skills so that they can guide the rest of employees to achieve their optimum performance.

Motorola proved this concept when it discovered that most of cost savings, process improvement, and higher customer satisfaction came from the direct labor working on the process. Those people are the best to know the process and its areas to improve. They know what impedes achieving excellence, and only by training them on problem-solving and improvement techniques they excel in achieving breakthrough yields and highly capable processes.

Employee involvement is essential in any successful Six Sigma project. Sense of responsibility and accountability by an employee is magnified when he/she is involved in defining the problem, measuring the process, analyzing root causes, and contributing to the selection of best solution to implement. By this the organization will get the one-million-dollar worth jewel of ‘employee Buy-In’.

As Alan Larson mentions in his book ‘Demystifying Six Sigma’, “something magical happens when employees become more experienced and effective with Six Sigma tools and the results come rolling in…you can feel human energy, like static electricity, in the air”.

By infusing six sigma skills throughout the entire organization you will develop a continuous improvement culture in which all employees are involved towards achieving customer satisfaction within the frame of collaborative focus led by the organization executives; this is the concept behind Total Quality Management (TQM). So, if you are thinking to improve your organizational performance, and I am sure everybody is, start by thinking out your strategy to instill the culture of continuous improvement among employees by training and by allowing those savior specialists to emerge from your company instead of paying thousands to acquire external professionals who are ‘foreigners’ to your processes and to your workforce which in turn may reduce the likelihood of your projects’ success. At the end of the day you are optimizing performance on employee as well as process levels and you increase the morale amongst your people.

NB Idea of this blog was inspired by Alan Larson book “Demystifying Six Sigma, A Company-Wide Approach to Continuous Improvement”