You've probably heard of Six Sigma.
But do you have the ULTIMATE step-by-step guide for implementating 6 Sigma?
Well that's where this post comes in.
My view:
As a Software Business Analyst, there are so many aspects of six sigma that we could use to improve our project outcomes.
So here's my side of the deal..
I'm giving you a detailed step by step guide to 6 Sigma methodology.
Then I'm comparing it to the ISEB Business Analysis Planning framework.
Before clearly explaining my secrets on how you can use the six sigma benefits.
6 Sigma is heavily statistical and a change methodology for ELIMINATING defects in any process. Founded in manufacturing but has stormed the transactional processing industry, such as finance, in recent years. If a company is achieving 6 sigma, they are losing only 3.4 products out of a possible 1,000,000 (1 million) produced. Likewise they are making only 3.4 errors for every million opportunities when processing transactions.
Many frameworks are in operation for 6 Sigma.
But, one of the most common is DMAIC
And that’s what I’m using to explain the technique.
What is Six Sigma DMAIC?
DMAIC stands for Define, Measure, Analyse, Improve, Control
However, Change DOES NOT guarantee improvement
It’s believed 90% of a company’s problems can be solved with just 7 basic tools:
And I’ll touch on all of these tools and techiques throughout this post
An Introduction to Business Analysis Practice framework
An IT Business Analyst may never use Six Sigma
So this is what the Business Analysis Practice certification teaches you.
And when implemented properly, provides a excellent framework for replacing manual processes with brand new systems
But there’s 3 reasons it ‘fails’ compared to 6 Sigma…
Why?
Because there’s very little focus on teaching BAs that STATISTICS ARE KING!
I’m telling you now:
There’s only one way of proving your findings and recommendations to the CEO -
By backing them up with clear, well thought-out statistical analysis.
Before I give you the second reason, let me show you this
The Business Analysis framework:
While, the BA framework is focussed on a project lifecycle, which means it has an end. 6 Sigma is continuous. It never ends. It drives an organisational culture.
When a BA finishes a project, they may move onto something completely different, unrelated.
Meaning a possible lack of long term stability.
When Six Sigma sub-project is finished, the next one begins as part of the 6 sigma organisation improvement programme.
Once a company achieves level 6 in 6 sigma, they must continue to change AND improve.
But lets be honest – Do Projects EVER end when adopting the standard BA project framework for system implementation? Probably not - they are either late, fail or too costly to finish
Which leads me to my 3rd reason for failure…
It’s a 21st century revolution for software development called AGILE.
If you’ve not yet heard of Agile you will very soon.
And even though it’s outside the scope of this post. My blog will undoubtedly begin to become more Agile focussed.
But the standard BA framework tells you to gather all requirements up front prior to beginning development.
It’s becoming old fashioned.
People are finally realising that you can’t possibly PLAN and gather ALL requirements, up front, for 2 years before delivering CRAP to the market. Which does happen in a lot of projects.
Rant over…
Six Sigma – DEFINE the project
The first step is to LAUNCH the project.
The goal?
Prove why a certain problem is important.
Here you will:
1. Brainstorm the list of problems & Select the most important to improve
Great for making employees feel involved right from the off
See my video on Workshop techniques
2. Collect customer feedback to identify problems & select the most important to improve
Customers can be internal or external
There are many ways to collect feedback from them. And you don’t even need to collect it yourself
Speak to the marketing team – I bet they already do it.
Ask the customer complaints department. You may have asked the customer complaints team to come to the brainstorming workshop.
3. Collect performance data (quality, cost, delivery, safety)
This is absolutely key!
To achieve this properly 6 sigma style, you will…
Find the database warehouse administrator in your company. He or she will have access to unthinkable amounts of data.
If you don’t know who it is, keep asking until you find them.
Then let them know you’re conducting a high profile project.
Get some data that relates to your brainstorming sessions.
4. Pick a product or service with the largest performance gap
Many companies have a product which is meant to be a high end product but is possibly receiving the most complaints?
That’s what is meant by ‘gap’ in performance.
It might not even be a product, it might be a hugely important transactional process that impacts CASH FLOW and YES 6 sigma can improve these too.
5. Review the organisations strategic plan
All six sigma improvements are driven by the strategic vision of the wider organisation.
So ask the directors if you can see the strategic documents.
Next, in Six Sigma you will:
6. define the project outcomes:
How will the success of the project be measured?
What specific aspect of the product or service needs improvement (Scope – quality, cost, delivery or safety)?
The 3rd task for defining a project is to Identify stakeholders
There’s a number of ways to identify your stakeholders and I’ve written a full post on how to significantly increase stakeholder engagement to your projects.
In short, there’s a few questions you need to ask yourself:
Who are the key people who will be impacted by the project?
How close will they be to the possible changes?
In answering these questions, you will now be able to select the team? Do you need full time employees or just ad-hoc input from colleagues?
Finally create a six sigma project plan…
A work breakdown structure OR a Gantt chart is used.
Tip: Don’t spend ages getting the dates perfect because the chances are they WILL change even if it’s just slightly.
Note: when defining the project, you can address issues that might NOT be the most important. That way you get to practice your improvement efforts on the
Business Analysis Framework – Investigate Situation
You could call this…
A combination of the DEFINE (above) and MEASURE (below) in DMAIC
The BA framework adopts a similar approach to defining the project.
BUT with much less emphasis on statistics.
AND projects are usually already decided by the powers.
So your first task will be…
Write a Terms of Reference in the form of a BOSCARD.
Asking questions based on BOSCARD gives you the KEY info as to why the project is being driven by the sponsors.
And there are some stats but not loads.
Next to identify the stakeholders. As in 6 Sigma.
And determine the method stakeholder management for each person. There’s 4 options
- Manage closely
- Keep informed
- Monitor
- Keep satisfied
Read my post on how to manage stakeholders using a Power Interest grid
As you can see:
The BA stakeholder approach is very similar to the Six Sigma Stakeholder management approach.
Now:
The BA approach quickly moves you onto using elicitation techniques for understanding the situation.
These include:
Pick your techniques carefully – what you do will depend on YOUR situation.
For example:
Workshops are good for getting lots of different views all at the same time.
Where as;
Interviews are useful when you have one person you know has the knowledge that you need.
Having collected the information, you will present your findings back to the stakeholders
This will be done using:
- Process models
- Data models
- Rich pictures
- Mind maps
This stage obtains consensus to future requirements.
So pick you audience carefully and get the right people involved.
Six Sigma DMAIC – Measure & Observe the Current Situation
The BA framework pushes you to define the current processes in the first step
But 6 Sigma allows for a little extra time to analyse the data.
You are searching for clues.
The steps to measuring the as-is situation in Six Sigma are…
1. Define the current process
How does the process produce the output?
Six Sigma answers this with the use of flowcharts.
And there are MANY different techniques.
SIPOC (Supplier, Input, Customer, Output, Process) is just one of them
I’ve written a step-by-step post on how to develop a SIPOC Diagram here
A simple flowchart is another way of identifying how the process works
Here’s some of the shapes used in a simple flowchart
The responsibility flowchart or SWIM LANE Diagram is another way of mapping the process.
Created when there are more than one actors or individual doing tasks within a process.
Layout diagrams may also be used to identify how the process fits together
Here’s an example of a layout diagram for a drivers licensing office:
2. Address 'low hanging fruit' - Quick fixes’
Experience six sigma practitioners will use their flow diagrams to identify improvement opportunities
AND implement them early.
It’s a perfect opportunity Fix the problems that are easy to fix.
BUT you must ONLY fix what the KNOWN cause of the problems
AND you know how to MEASURE the improvements
The fix may be a simple adjustment of the process steps.
And a simple change could save hours of work
One approach to identifying improvements is the simple 5S
What’s 5S?
Sort – sort out your stuff so it’s easily acessible
Shine – clean everything
Set-in Place – choose who will maintain the clean work place
Standardise – Do the same each time
Sustain – Ensure all the abive are repeated as often as needed.
Another technique is to apply the 20 questions strategy to EVERY task on the diagrams:
3. Obtain customer needs
If it’s not known EXACTLY what the customer wants or needs.
Now’s the time to find out.
Surveys or questionnaires are used to do this
Or even interviews.
But the key thing.
The customer’s needs MUST be transferred into measurable characteristics of your services.
Known as Critical-to-Quality measures (CTQ )or performance measures
You will already have some performance data from the DEFINE stage
But the measure MUST relate to the problem identified.
Some people like to measure what’s easy, or even worse what looks good.
For example
- A customer wants their order on time. Measuring the number of orders sent out each day does not help but it may make the team look good.
This is avoided in when Six Sigma is implemented properly.
Remember this too:
Customers don’t have to be external to the company
They CAN be internal or even stakeholders of the current project.
Example of CTQs:
Customer request
Fast delivery - Time taken to deliver
Durable product - Lifespan and reliability level
Accuracy of processing - number of errors found
4. Gather initial metrics
Once it’s known what customers want
We collect data on the key measures.
measure the performance of the current process.
This is done in different ways depending on the type of data
Measurement – e,g, time, speed, costs
Count – e.g. Errors, defects,
Regardless of which tyoe of data is measured, it’s always useful to work out
1. the mean – average of a set of numbers
2. Median – the midpoint
3. Mode – the most frequently appearing
Other measures of variability include:
4. Range – difference between the largest and and smallest
5. Variance – Sum of squared differences (COMPLEX)
6. Standard Deviation – (COMPLEX)
5. Determine current Sigma
Determining current sigma is a very time consuming task.
In Six Sigma this is an absolute MUST.
BUT if you’re simply adding six sigma techniques to your BA project, then you don’t really need to do it to such a statistical degree.
Here’s a six sigma calculator if you have the data and are working on a six sigma project where knowing this is vital
6. Stratify the data
Stratifying the data allows you to look at the issues from different angles
Remember YOU will need to work hard at getting your hands on the data.
It can be quite difficult.
But don’t give up.
Why?
Because knowing stats gives you a great position to make very important decisions in the future.
So…
Look at differences in time, place, type, and symptom of the problem
Pareto Analysis is a technique that towers above many others due to it’s simple nature.
20% of the problems cause 80% of the issues.
Pareto WILL allow you to identify the most impactful problem to address
Or put even simpler – 80% of your revenue is generated by 20% of your products.
[IMAGE Pareto chart example]
Other stratification techniques include:
Six Sigma Bar charts:
Six Sigma bar charts will show differences beetween categories
And the construction of bar charts is very simple:
Label the vertical axis with the performance unit of measure (UOM) and the horizontal axis with the categories.
As so...
Six Sigma Pie charts:
The pie chart shows relative portions of data
Variables can be broken down into categories such as type, job, department, regon, store.
It’s the perfect way to stratify the CTQs I mentioned earlier by errors in different times places or areas.
Now that the data has been stratified.
It’s time to move on to studying the variation.
Let’s look at some of the techniques used to do this:
7. Determine initial value proposition
In Six Sigma you must clarify the Problem Statement
By now you will have much more knowledge of the problem(s) at hand
At this point try to estimate how much money could be saved
Define or refine any previously determined improvement targets