 Why
Six Sigma?
Global competition and market
pressures mean market price levels are always under threat of dropping.
This threatens profits unless cost can be reduced, or new business
opportunities created. Succeeding in business is a real challenge. There is always
pressure for a business to improve their processes, even to just maintain
their position, profitability or to stay in
business.
One all-to-common strategy for
"improvement" is the simple "across the board" cost-cutting
exercise. Unfortunately this is often done without understanding
the business processes, and can cut out critical, but unseen business
process activities. This
indiscriminate type of cost cutting produces short term gains (so it
appears to have worked), but it also produces higher long term costs. In
the longer term the costs are:
-
the cost of time
and resource in investigating and identifying the missing
critical process activities,
-
the cost of time
and resource in redesigning the missing critical process
activities,
-
the cost of time and
resource in regaining the knowledge of the lost critical
processes activities,
-
the cost of reinstating
the necessary resources to carry out the critical lost processes activates,
-
or worse of all, if you
fail to act and do the above, the problem goes unnoticed until the
process fails in front of the customer (reputation,
penalties, litigation and lost business!) and you then also
have the cost of the above four to make your business work properly!
Remember this is all taking
place in an environment where costs and resources and resources have been
cut, so while people are doing the above activities they are not carrying
out the main business activity! The business is shrinking.
Shrinking your business is not a good long term
strategy for it's success!
Six Sigma is knowledge
based. Done properly, it achieves long term improvement and business growth. It
demands understanding of who process customers are and what are
their true needs.
Using six
sigma, the process definition, measurement,
analysis, improvement and controls are developed and documented. New
knowledge of the process is often discovered and documented which can give
competitive advantage or Intellectual Property Rights opportunities. Any
true waste or inefficiencies in the process (called the "cost of poor
quality" or COPQ) are eliminated. The resulting processes deliver the customers'
needs more consistently, faster and at lower cost.
|
Downloads
