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Six Sigma’s critical success factors and toolbox
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Department of Marketing and Operations Research, University of Macedonia, Edessa, Greece
Vasileios Ismyrlis and Odysseas Moschidis
Abstract Purpose – The purpose of this paper is to put forward and classify the critical success factors (CSF) of Six Sigma implementation, as well as the tools-techniques that it utilizes in all the phases of the Define-Measure-Analyze-Improve-Control (DMAIC) structured methodology. Design/methodology/approach – A literature review of Six Sigma’s CSF has been realized and also an attempt to connect them with the enablers of European Foundation for Quality Management (EFQM). A literature review of the tools and techniques utilized follows and a categorization of them according to the phase of the DMAIC. Findings – The paper has collected a list of 32 CSF which were classified according to the five EFQM enablers, and the soft-hard differentiation. A list of 39 tools/techniques used in the different phases of DMAIC and the ISO 13053-1 suggestions has also been referred. Originality/value – The final classifications of CSF and techniques of Six Sigma methodology could be a valuable tool for Six Sigma academics and professionals to understand and implement the methodology in the appropriate way. Keywords Six sigma, Critical success factors, DMAIC, EFQM Paper type Conceptual paper
International Journal of Lean Six Sigma Vol. 4 No. 2, 2013 pp. 108-117 q Emerald Group Publishing Limited 2040-4166 DOI 10.1108/20401461311319310
Introduction Six Sigma is one of the last additions in the field of quality improvement methods and (or) business process improvements methods. Although it has been implemented for many years mainly in large manufacturing companies, like Motorola, GE and Honeywell, it does not have the appropriate response popularity in service industries and even less in countries outside the USA. Europe for example has given more emphasis to the International Organization for Standardization (ISO) family standards. According to Eckes (2001), Six Sigma is the most popular quality improvement methodology in history. Antony (2006) considers it as a business strategy known as an imperative for operations and business excellence. Its structured framework for controlling processes and measuring results with a financial aspect and with the use of quantitative techniques and tools has drawn the attention from academics and practitioners. In many cases its business performance achievements are remarkable. Even better, the ISO (2011), having recognized its great influence, issued the 13053-1 standard “Quantitative methods in process improvement Six Sigma”, where it tried to describe the methodology with terms of standardization. On the other hand, it has been the recipient of much criticism. The reason is because there is incompleteness in its methodology and serious misconceptions in the literature, as to what constitutes Six Sigma theory (Aboelmaged, 2010). A reason for this maybe the fact that it has originated in industry (Antony, 2004) and therefore cannot have the same impact in all kind of enterprises.
The present study deals with the exploration of the critical success factors (CSF) of Six Sigma implementation. A total list of 32 factors were collected from the bibliography and were documented. There was an effort to connect and categorize these factors with the five enablers of the European Foundation for Quality Management (EFQM) model (leadership, strategy, people-staff, partnership and resources, processesproducts-services). A classification in soft and hard factors has also been made. This attempt to describe and understand its success factors will contribute to look deeper in its theory. In addition many of the tools/techniques used in the implementation of Six Sigma were referred and categorized by phase of define-measure-analyze-improve-control (DMAIC) which they are used. There was another classification according to proposals from ISO 13051-1 standard for the utilization of every tool or technique. The main goal of this paper will be to provide a clearer understanding of the Six Sigma methodology and resolve some misconceptions that exist in its theory. Definition of Six Sigma – theoretical background Naturally the term Six Sigma comes from statistics as the Greek letter s (sigma) symbolizes the standard deviation, namely the dispersion of the data from the mean average. Number six expresses the accepted level of quality that is six times the standard deviation. These are some of the reasons why most people, consider Six Sigma as a purely statistical methodology. The truth is that we cannot ignore the fact that it also uses many non statistical tools and techniques. In methodology’s practice the term Six Sigma level, means 3.4 defects per million opportunities or success rate of 99.999660 percent. The assumption is of course that the data follow the normal distribution and also given that the mean average of a process, tends to drift by the amount of 1.5 sigma on average from tolerance limit (specification). The latter acceptance has been made from company Motorola, which had implemented for the first time and eventually gave birth to the method. Six Sigma’s purpose is to reduce the variance-variability in processes, so to provide to the clients-consumers of the organization, products or services which are more reliable and with fewer errors. Moreover, some companies (like airline ones) implement or try to adopt Seven Sigma level, which means even fewer defects and more satisfied customers. 2.1 Definitions There are many determinations and definitions of SS (Henderson and Evans, 2000) and defining it in simple terms is not possible because it consists of problem solving methodology and focuses on optimisation of financial returns, including culture change within an organization (Raisinghani et al., 2005). Generally we can say that it is a method which tries through the registration, analysis and adjustment of processes to reduce defects-errors and to make the product or service suitable for customer’s needs, having as basic requirement the total commitment of management. It gives much importance in management of processes-procedures, because process considered to be the fundamental element in organization functioning. Process considered as a network of activities-actions repeatable, and its cause is to create values to external and internal customers (Bergman and Klefsjo¨, 2002). There are also theories and studies that pay attention to its statistical background and consider it as a statistical approach for controlling quality (Hahn et al., 2000; Hoerl and Snee, 2002) and others that consider it
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a management strategy to improve business profitability, improvement in effectiveness of processes and customer satisfaction (Sanders and Hild, 2000; Antony and Banuelas, 2001). It is moreover a quality improvement method, which succeeds in performing positive outcomes not only in manufacturing but in services companies as well (Antony et al., 2007).
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2.2 Components of Six Sigma methodology Basic ingredients of Six Sigma considered to be the following: (1) The structured model called DMAIC, which is divided into five phases and has as a purpose to improve already existing processes. Something equivalent is the plan, do, study, act circle of Deming (1993). (2) Critical to quality focus, which means focus on the client and those characteristics of the product which are crucial for its satisfaction. (3) Design for Six Sigma (DFSS), which is a structured procedure realized in the stage of designing the product or a process, so to prevent defects-errors-problems. Also referred as define, measure, analysis, design, verify (DMADV). (4) The results of its implementation, are usually expressed in financial terms, such as: . cycle times; . product quality; . product delivery; . on hand inventory; . usage of space on the production floor; . productivity measurement; . supplier performance in comparison to organizational need; . profitability; and . market share. (5) Existence of an hierarchical belt system, with certified staff (champion, master black belt, black belt, etc.). (6) Top-down approach. This means that the attempt of its implementation, originates with the obligatory commitment and participation of the management. (7) Performance metrics. Metrics are utilized to express the performance of the organization in the processes, and some of them are: sigma level, defects per million opportunities, rolled throughput yield (Yrt) and defect per unit (DPU). A most important ingredient is as referred, the structured method DMAIC, which is utilized in all the prodedures-processes, considered to be improved. The phases-stages of the method follow: (1) Define. Define the characteristics-specifications of product that satisfy the customer. According to this rule all processes must be error free or have errors below some limit. Otherwise they must be improved.
(2) Measure. The process to be analyzed, is measured and data is gathered and compared with specifications defined in phase 1. (3) Analyze. Data from the measurement phase analyzed to find correlations, relations, causes, etc. (4) Improve. Solutions, recommendations and actions to improve the process so as to achieve the desired performance specifications. (5) Control. Establishment of standard measures to maintain the performance, and correct any possible problem, as needed. Critical success factors Critical factors are the essential ingredients required for the success of Six Sigma projects in an organization (Coronado and Antony, 2002). In addition if objectives associated with these factors are not achieved, the organization will fail with serious negative consequences in the organization (Rockart, 1979). Companies having implemented Six Sigma had different results due to the complexity of the methodology, therefore to have a successive implementation, attention must be drawn to the key elements of Six Sigma (Coronado and Antony, 2002). What it must be emphasized is that all the authors having recorded the success factors, have extracted much elements from one of the quality gurus Deming, who having mentioned 14 propositions (Deming, 1993) that a company manager should implement for the improvement of individual and team performance, had made a big contribution to the construction of the theory followed about quality improvement systems. One from the first authors that mentioned success factors for Six Sigma is Harry in, 2000. The CSF which will be referred in the current study, are implemented in service firms and industries, and in small, medium and bigger size companies as well. What differs is the degree of the importance of the factor according to the kind of organization. Factors are referred with different expressions and manners in bibliography, but there was an effort to report all of them and as an author is mentioned the first one that recorded it. It can be concluded that the most important factors for the implementation of SS are: management commitment, training, cultural change, importance to financial benefits, statistical tools and data analysis, linking it to business strategy (Chakrabarty, 2009; Brady and Allen, 2006; Scho¨n, 2006). We will refer shortly to the most important of the factors: (1) Management involvement and commitment. Considered to be the most important factor, as Six Sigma is a top-down methodology, which means that the attempt for improvement, begins from the top management and required prequisition and the participation of leadership in all stages of its implementation. (2) Appropriate training and education. Six Sigma with the structured role system, has as a requirement the appropriate and continuous training of the employees involved in its implementation. (3) Cultural change. It is the ability of the organization to adopt and implement easily, new ideas, concepts, methodologies and to be flexible in taking decisions for continuous improvement.
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(4) Attaching the success to financial benefits. SS implements methods of measuring performance, after its application, so to represent the success of its implementation. Financial benefits are such as a measure of expressing the SS achievement. (5) Utilization of quality-statistical tools and data analysis. The use of tools and techniques for cause exploring, data analysis and decision making, considered to be essential. These tools are not all statistical but there are also analytical or managerial, like brainstorming, process mapping, etc. (6) Linking 6s to business strategy. Six Sigma philosophy must be inextricably connected to the strategy the organization follows, so every action and decision must be in the appropriate manner defined. After the literature review a total of 32 factors have arose and are following in Table I. In Table I there was a separation-segmentation of the factors in two different categories. One is about the classification in hard and soft, and the other according to the enablers, which originated from the EFQM (2010) and ultimate Six Sigma models (Shanin, 2011). A. Soft-hard, CSF of Six Sigma, can be separated in hard and soft (Kundi, 2005). The soft ones, relate to behavioral and cultural aspects, management philosophy and usually deal with human resources, and people aspects such as education, communication and others. The hard factors that are easier quantified, accountable and observable, deal with the main function and structure of Six Sigma methodology, such as the tools and techniques utilized. B. Enablers, the EFQM model encompasses nine major criteria in two categories. The first five criteria are regarded as “enablers”. The five enablers are used with an aim to be able to group the CSF and they are: leadership, strategy, people-staff, partnership and resources, processes-products-services. A more detailed description of the enablers is realized below: (1) Leadership. The way the top management develop and facilitate the vision and mission of the company. This can be achieved with employees encouragement, but also with the active participation of the management. (2) Strategy. The way the organization implement its mission and vision. (3) People-staff. How the company manages and spreads knowledge and assure maximum effort from all its people to achieve the targets. (4) Partnership and resources. Successful implementation of cooperation with external partnerships and appropriate use of resources. (5) Processes, products/services. Actions according to design, production of products/services and process improvement regarding these actions. Statistical/management tools and techniques Like many others methodologies, Six Sigma is pretty much a collection of tools that may or may not be relevant for a task at hand. They are all practical methods employed by qualified employees to handle quality related problems for fostering performance improvement. Most of the tools have already being used in other management techniques and as referred above the tools are not only statistical.
Critical success factor
Hard/soft Enabler Author
1.1 Top management involvement and commitment 1.2 Management of cultural change 1.3 Spirit of innovation in the company 1.4 Attaching the success to financial benefits 1.5 Appropriate training and education of the staff at all levels 1.6 Focus on customer 1.7 Linking Six Sigma with the suppliers 1.8 Linking Six Sigma to business strategy
Soft
1
Harry (2000)
Soft Soft Soft Soft
1 1 2 3
Henderson and Evans (2000) Yun and Chua (2002) Harry (2000) Harry (2000)
Soft Soft Soft
2 4 2
Soft Soft
3 3
Harry and Schroeder (2000) Goldstein (2001) Antony and Banuelas (2002) Henderson and Evans (2000) Goldstein (2001)
Soft
4
Pande and Larry (2002)
Soft
2
Antony et al. (2005)
Soft Hard
2 5
Byrne (2003) Bhote (2002)
Soft
5
Hard
2
Henderson and Evans (2000) Henderson and Evans (2000)
Soft
3
Soft
3
Antony and Banuelas (2002) Breyfogle (2003)
Hard Hard
4 5
Pande and Larry (2002) Buch and Tolentino (2006)
Soft
3
Soft Soft
5 2
Henderson and Evans (2000) Zu et al. (2008) Pande and Larry (2002)
Soft Soft
2 3
Goldstein (2001) Scho¨n (2006)
Soft
2
Cronemyr (2007)
Soft Soft Soft Hard Soft
2 3 2 2 2
Scho¨n (2006) Cronemyr (2007) Scho¨n (2006) Goldstein (2001) Scho¨n (2006)
Hard
2
Harry (2000)
1.9 Linking Six Sigma to human resources 1.10 Effective communication between the different departments 1.11 Adequate resources for implementing the system 1.12 Linking the implementation of quality system to the Information management systems 1.13 Setting measurable goals and objectives 1.14 Implementation of a system to analyze and measure processes 1.15 Data from measurements is easily obtainable by all the interested parts 1.16 The implementation of quality improvement program is realised through an organizational infrastructure 1.17 Knowledge and understanding of the methodology and its techniques 1.18 Selection of team members to participate in the team projects of quality improvement 1.19 Appropriate utilization of the tools/techniques 1.20 Sufficient knowledge of statistics and statistical methods 1.21 Employees promotion and incentive compensation tied to the results of SS projects 1.22 Focus on product/service design 1.23 Attention given to both long-term and shortterm targets 1.24 Safe environment 1.25 Importance of the role-participation of the middle management 1.26 Creation of qualitative goals, such as customer value 1.27 Knowledge and competence 1.28 Ability to learn from the past 1.29 A uniform language and terminology 1.30 Establish a system to track all projects 1.31 Follow-up and communication of success stories 1.32 Selection of 6s projects and evaluation
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Table I. Success factors
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Tools is a simple way to solve a problem. Techniques have a broader application from tools and may include many tools. Except the registration of the tools and techniques from many sources, the basic selection was made from the tools and techniques listed in the ISO 13053-1 standard. Finally, the most commonly used tools and techniques in Six Sigma methodology are listed in Table II. In column A there is the suggestion from the ISO 13053-1 standard, for the usefulness of every tool or technique, where M – mandatory, R – recommended, S – suggested. A. Usefulness
B. Name of tool/technique
C. Phase of DMAIC
D. Tool or technique
S
Pareto diagram Histogram Run chart Pies, bar charts Scatter diagram Hypothesis tests Analysis of variance Regression analysis Correlation analysis Design of experiments Non-parametric tests Brainstorming Tree diagram Cause-effect diagram (fishbone) Control chart Flow chart GANTT chart Checksheet Process map Process capability analysis SIPOC diagram SWOT analysis Voice of the customer Affinity diagram Critical to quality matrix KANO model Quality function development (QFD) Benchmarking Statistical process control (SPC) Failure mode effect analysis (FMEA) Mistake proofing (poka yoke) Six Sigma indicators Prioritization matrix Descriptive statistics Relations diagram Process decision program chart Arrow diagram Matrix diagram Matrix data analysis
DMAI A A A A AI AI AI AI AI AI I D A M DAI D General DA(I) DAC DI D D A DMIC D DAI MI MAC AI I DI D M I I D D D
7qc 7qc 7qc Tool 7qc Tool Tool Tool Tool Technique Tool Tool New 7qc 7qc Tool Tool 7qc Tool Technique Technique Technique Technique New Tool Tool Technique Technique Technique Technique Technique Tool Technique Tool New New New New New
R R R R R S
R R
R RS
S M S R R R RM M R Table II. Tools and techniques by group of: suggested usefulness from ISO 13053-1 (A), phase (C), tool/technique(D)
In column C there is the phase of the DMAIC method that the tool/technique is used, where D – define, M – measure, A – analyze, I – improve, C – control. Some tools may be used in more than one phase. In column D, we have the groups: “tool”, “technique” and moreover there are some tools belong to two extra groups, “7qc” – 7 seven quality control tools (Tague, 2004), “new” – new management tools (Tague, 2004).
Six Sigma’s CSF and toolbox
115 Conclusions Six Sigma combines fine elements of many former quality and management initiatives. The majority of the tools and techniques it utilizes, are not something new in the theory of quality. Consequently, there is a strong relation of Six Sigma methodology to all the other quality and management improvement initiatives. The purpose of this paper was to identify the factors that are crucial in effective implementation of 6s, factors that have been described by many authors. The presentation of the factors should help all the interested parts to have an image of the actions needed to implement the method. The tools and techniques of the methodology in the different phases of DMAIC were also reported and categorized. The existence of many factors is an indication of the rather confusing theory of SS. A step to fill the gap between the theory and the practice of Six Sigma, is to measure and compare the results from the degree of existence and implementation of these factors in real situations. References Aboelmaged, M.G. (2010), “Six Sigma quality: a structured review and implications for future research”, International Journal of Quality & Reliability Management, Vol. 27 No. 3, pp. 268-317. Antony, J. (2004), “Six Sigma in the UK service organizations: results from a pilot survey”, Managerial Auditing Journal, Vol. 19 No. 8, pp. 1006-1013. Antony, J. (2006), “Six Sigma for service processes”, Business Process Management Journal, Vol. 12 No. 2, pp. 234-248. Antony, J. and Banuelas, R. (2001), “A strategy for survival”, Manufacturing Engineer, Vol. 80 No. 3, pp. 119-121. Antony, J. and Banuelas, R. (2002), “Key ingredients for the effective implementation of Six Sigma program”, Measuring Business Excellence, Vol. 6 No. 4, pp. 20-27. Antony, J., Kumar, M. and Madu, C.N. (2005), “Six Sigma in small and medium-sized UK manufacturing enterprises: some empirical observations”, International Journal of Quality and Reliability Management, Vol. 22 Nos 8/9, pp. 860-874. Antony, J., Antony, J.F., Kumar, M. and Cho, R.B. (2007), “Six Sigma in service organisations: benefits, challenges and difficulties, common myths, empirical observations and success factors”, International Journal of Quality & Reliability Management, Vol. 24 No. 3, pp. 294-311. Bergman, B. and Klefsjo¨, B. (2002), Quality from Customer Needs to Customer Satisfaction, McGraw-Hill, New York, NY. Bhote, K.R. (2002), The Ultimate Six Sigma: Beyond Quality Excellence to Total Business Excellence, AMACOM/American Management Association, New York, NY. Brady, J. and Allen, T. (2006), “Six Sigma literature: a review and agenda for future research”, Quality and Reliability Engineering International, Vol. 22 No. 3, pp. 335-367.
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Breyfogle, F.W. (2003), Implementing Six Sigma, 2nd ed., Wiley, Hoboken, NJ. Buch, K.K. and Tolentino, A. (2006), “Employee expectations for Six Sigma success”, Leadership & Organization Development Journal, Vol. 27 No. 1, pp. 28-37. Byrne, G. (2003), “Ensuring optimal success with Six Sigma implementations”, Journal of Organizational Excellence, Vol. 22 No. 2, pp. 43-50. Chakrabarty, A. (2009), “Six Sigma in service organizations: a conceptual framework based on aspects of implementation and performance”, PhD thesis, University of Singapore. Coronado, R.B. and Antony, J. (2002), “Critical success factors for the successful implementation of Six Sigma projects in organizations”, The TQM Magazine, Vol. 14 No. 2, pp. 92-99. Cronemyr, P. (2007), “Six Sigma management”, PhD thesis, Chalmers University of Technology. Deming, W.E. (1993), The New Economics, M.I.T. Institute of Technology, Cambridge, MA. Eckes, G. (2001), Making Six Sigma Last: Managing the Balance Between Cultural and Technical Change, Wiley, New York, NY. EFQM (2010), The EFQM Excellence Model, European Foundation for Quality Management, Brussels. Goldstein, M.D. (2001), “Six Sigma program success factors”, ASQ Six Sigma Forum Magazine, Vol. 1 No. 1, pp. 1-11. Hahn, G.J., Doganaksoy, N. and Hoerl, R. (2000), “The evolution of Six Sigma”, Quality Engineering, Vol. 12 No. 3, pp. 317-326. Harry, M. and Schroeder, R. (2000), Six Sigma – The Breakthrough Strategy Revolutionizing the World’s Top Corporations, Doubleday, New York, NY. Harry, M.J. (2000), “Six Sigma: a breakthrough strategy for probability”, Quality Progress, May, pp. 60-64. Henderson, K.H. and Evans, J.R. (2000), “Successful implementation of Six Sigma: benchmarking General Electric Company”, Benchmarking: An International Journal, Vol. 7 No. 4, pp. 260-281. Hoerl, R.W. and Snee, R.D. (2002), Statistical Thinking: Improving Business Performance, Thompson Learning, San Jose, CA. ISO (2011), ISO 13053-1: Quantitative Methods in Process Improvement – Six Sigma – Part 1: DMAIC Methodology, International Standards Organization, Geneva. Kundi, O. (2005), “A study of Six Sigma implementation and critical success factors”, paper presented at Pakistan’s 9th International Convention on Quality Improvement, Karachi, Pakistan, November 14-15. Pande, P. and Larry, H. (2002), What is Six Sigma, McGraw-Hill, New York, NY. Raisinghani, M.S., Ette, H., Pierce, R., Cannon, G. and Daripaly, P. (2005), “Six Sigma: concepts, tools, and applications”, Industrial Management & Data Systems, Vol. 105 No. 4, pp. 491-505. Rockart, J. (1979), “Chief executives define their own information needs”, Harvard Business Review, Vol. 2, pp. 81-92. Sanders, D. and Hild, C.R. (2000), “Six Sigma on business processes: common organizational issues”, Quality Engineering, Vol. 12 No. 4, pp. 603-610. Scho¨n, K. (2006), “Implementing Six Sigma in a non-American culture”, Int. J. Six Sigma and Competitive Advantage, Vol. 2 No. 4, pp. 404-428. Shanin, A. (2011), “Integration of EFQM and ultimate Six Sigma: a proposed model”, International Business Research, Vol. 4 No. 1.
Tague, N.R. (2004), The Quality Toolbox, 2nd ed., SQ Quality Press, Milwaukee, WI. Yun, J.Y. and Chua, R.C.H. (2002), “Samsung uses Six Sigma to change its image”, Six Sigma Forum Magazine, Vol. 2 No. 1, pp. 13-16. Zu, X., Fredendall, L.D. and Douglas, T.J. (2008), “The evolving theory of quality management: the role of Six Sigma”, Journal of Operation Management, Vol. 26. Further reading Crosby, P.B. (1979), Quality is Free, McGraw-Hill, New York, NY. About the authors Vasileios Ismyrlis has been an Administrative employee, for the last nine years, in the social insurance institute IKA-ETAM. He has also two years’ experience in a bank and has taught financial lessons in vocational post-secondary education. He graduated with a degree in Statistics and Insurance Sciences from University of Piraeus. His postgraduate studies are in the field of Quality Assurance. His current studies are for a PhD in Quality Management and Multidimensional Statistics, at the Department of Marketing and Operations Management of University of Macedonia, Greece. Vasileios Ismyrlis is the corresponding author and can be contacted at:
[email protected] Odysseas Moschidis is an Assistant Professor (Applied Statistics with emphasis in Business Administration) in the Department of Marketing and Operation Management of University of Macedonia, Greece. He graduated with a degree in Mathematics from Aristotle University of Thessaloniki. His postgraduate studies are in the field of Applied Statistics and Applied Mathematics and he holds a Doctor’s degree in “Contribution to the study of scales evaluation with the method of multidimensional data analysis” from the Department of Applied Informatics of the University of Macedonia, Greece. He has participated in several research projects, working on the areas of evaluating business data and market research and multidimensional statistical analysis. His research interests include the areas of scales evaluation, multidimensional statistical analysis and evaluation of business data and market research. He has authored chapters and numerous publications in international journals and conferences.
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