PIPs yield progress
Oct 1, 2006 12:00 PM, By Kevin McNamara, CNE
The majority of large corporations throughout the world have been adopting some form of process improvement programs (PIP) in their day-to-day operations to increase production efficiencies, maintain customer loyalty and achieve significant cost savings. There are several PIPs available; these include: the Theory of Constraints (TOC), Just-in-Time (JIT), Lean Thinking, ISO 9000 quality standards and Six Sigma. Many of these have been around for years and you have no doubt heard or read about them in the past.
The goal of PIPs is to improve the way organizations perform specific tasks to achieve increased efficiency and lower costs. In the end they should also affect customer satisfaction with the product or service in a positive manner, i.e. more reliability or improved performance. Most PIPs are tailored for specific applications, such as those found in manufacturing or service businesses, but in concept can be applied to any business that provides something to an end-user, including the broadcasting business.
One of the more common PIPs used in large businesses today, Six Sigma, is based on standard deviation from the mean of a group not totally unlike the methodologies used by the audience rating services that measure the listening or viewing habits within a market.
The official definition of Six Sigma as applied to PIP is "a systematic and innovative activity that assesses the causes for defects and errors occurred in every sector of the management based on the statistical measures, analyses the causes and ultimately eliminates them."
The concept behind Six Sigma has been around for several decades, but in 1986 an engineer at Motorola named Bill Smith was recognized as the originator of the name as applied to the PIP most known for reducing manufacturing defects and improving the quality control of products. The term Six Sigma is, in fact, a registered service mark and trademark of Motorola.
Theory behind Six Sigma
The primary application for Six Sigma is traditionally in a manufacturing environment but has been successfully applied to other businesses such as engineering and construction. The basic concept of Six Sigma is to reduce the total amount of defects experienced by an end user to 3.4 defects per one million products.
The theory is deeply rooted in mathematics, hence the term Sigma, which represents a deviation from a mean value. In this case, the term Six Sigma would represent a window of six deviations on either side of the mean. Interestingly, the 3.4 defects per million actually translates to a value about 4.5 deviations from the mean, not 6. So what gives? Somewhere along the development of the PIP, there were 1.5 deviations added, which is known as the 1.5 sigma shift (or drift).
Six Sigma methods
There is more than one methodology for implementing a Six Sigma PIP. Which is used depends on the type of business or process application. The two most common are DMADV and DMAIC.
DMADV is an acronym for define, measure, analyze, design and verify. This method is used for the development of processes or product development.
DMAIC stands for define, measure, analyze, improve and control. This method replaces the "design and verify" used in DMADV with "improve" and control," which permits the PIP to be used with general business processes.
What is necessary to understand is that any implementation of Six Sigma requires a significant commitment throughout a company. To implement the program properly, those tasked with carrying out the program need to commit all or a portion of their time working on the program.
There is also a great deal of training required to continually develop the program and ensure its future success. Finally, Six Sigma PIPs do not deal with global company issues, rather it is intended for single processes used in the business. In most cases, separate PIPs will be developed for multiple processes within a single project.
To carry out the PIP, the problem must be defined. The definition of the problem typically is identified by the employee (or group of) that are closest to the task, called the Yellow Belts. The specific problem needing improvement is defined along with the supporting documentation and submitted to a Green Belt, who further gathers the appropriate information and provides a more detailed analysis of the problem and potential solutions.
This information is then sent to a Black Belt who is responsible for packaging the provided PIP and ultimately analyzes the cost/benefit of the PIP at the high levels of the company. He may also ask for further input from other departments as necessary.
Once the PIP is completed it is presented to upper management for approval. Once approved, the PIP is published throughout the organization to implement the change.
Implementing a Six Sigma PIP within a company also requires that many, if not all, employees hold one of many certifications depending on their specific role. The name given to these certifications are synonymous with the ranking system found in martial arts and tend to reflect the responsibilities of the individual.
Yellow Belt - This level can also be called gold belt and represents an employee who is typically "front lines" in terms of the issue. They can identify the problem and possibly offer a suggestion on how it may be improved.
Green Belt - These employees spend more time implementing PIPs along with working on their normal workload.
Black Belt - These are the leaders of individual PIPs. They are typically employees dedicated to carrying out the PIPs, including presenting them to upper management and are expected to complete an average of six per year.
Master Black Belt - Are usually assigned to manage all PIPs within specific departments at the corporate level.
Champion - Has overall responsibility to carry out the program and ensure the employees have the required training and resources needed.
There is great deal of information on the Six Sigma and other PIPs on the Web. Even if your company has not adopted a formal program, use some of the methodologies on a smaller scale within your department to help with day-to-day activities, particularly if those include managing a new construction project.
McNamara is president of Applied Wireless, Cape Coral, FL.