Chapter 7. Six Sigma

BRIAN NEELY IS CTO OF A MAJOR SYSTEMS INTEGRATOR BASED OUT OF THE WASHINGTON D.C. AREA. I was speaking to Brian recently about his own focus on process improvement and how he sees process contributing to the success of large companies. "At one level, it's about expanded potential," he said, referring to the use of process programs within various company subsidiaries, "but at the executive level, it is about performance, especially performance measures."

Brian's focus is on empirical process improvement, the ability for operating units to demonstrate efficiencies through data and to establish performance trends over time through the analysis of data. That's a somewhat typical viewpoint for CFOs. Companies use financial standings, projected revenues, and burn rates as reliable predictors of success. The story is in those numbers. But that's a relatively advanced viewpoint for CIOs and CTOs. However, it's becoming more and more common. And more and more popular. As the IT industry begins to increase its appreciation that process lies at the heart of any technology development effort, the interest in process performance should increase proportionately.

That brings us to the subject of Six Sigma.

In the previous two chapters, you got an overview of ISO 9001 and CMMI. You saw that these programs were geared toward helping an organization implement process programs, perhaps to refine a current process position or to create a program from the ground up. In essence, those programsthose approachesare all about instituting best practices. They help an organization set into place the structure for process improvement and, by default, quality management.

Six Sigma is different. Six Sigma has recently stepped into the field of IT as a Hot Topic. It has generated a lot of buzz, even more so than ISO or CMMI. People seem to be talking about it, discussing it, trying to figure out what place it might have in their organizations. Six Sigma is different from ISO 9001 and CMMI in that its focus is on measuring existing processes with a view to making them more efficient and effective.

Six Sigma assumes you have processes in place. Maybe they are formal, maybe they are informal, but you are definitely doing something to produce something. At its core, Six Sigma is a way to measure processes and then modify them to reduce the number of defects found in what you produce. With this program, you study the sources of defects and then analyze ways to make the processes more resilient, so that defects are not introduced or have fewer opportunities to creep in.

Many people think that the idea behind Six Sigma is to have a system that produces zero defects. That's not really true. But, statistically, the rote measure of "six sigma" means that your system will turn out only 3.4 defects per million opportunities for defects. (I'll look at this in more depth later.) But even that is not a really accurate representation of the intention of Six Sigma.

The real idea behind Six Sigma is to manage process improvement quantitatively. It seeks to put measures and controls in place so that you can readily and regularly monitor the performance of your processes and, using performance data, adjust them to maximize their ability to produce predictable, quality results.

You can think of Six Sigma as the evaluation side to a process improvement program. That's why many organizations pair Six Sigma with programs like ISO 9001, CMMI, or LEAN. Six Sigma gives you the tools you can use to rate how well these programs are performing for you. And this rating is not qualitative. It is not instinctive or intuitive. It is a rating based on hard data, on fact.

As this chapter looks at the high-level focus of Six Sigma, you'll see that it is a cycle of seven general steps:

1. Look at the product. Put a critical eye on what you produce. Continually examine what it is you make and how you make it so that you can always seek ways to make it better. There are few sacred cows in Six Sigma.

2. Identify defects. Examine your product and identify defects. Count them. Measure them. Know what you mean by the term "defect." You can think of a defect as anything that holds your product back from being the best it can be in the minds of your customers.

3. Look to the process. If the product is not all it can be, then chances are your processes could be improved. Examine your processes. What's happening with your current processes that might be letting defects in? What opportunities might you see to keep defects out?

4. Determine sources of defects. Analyze how the process works. Study its flows and structure to determine where in its operations defects are seeping in.

5. Improve the process. Based on your analysis of process performance and your understanding of the process structure, you now adjust the process with the intention of improving its performance. The goal is to lock defects out.

6. Use the new process. Now that you have improved the process, put it to work. Set it into the production environment and let the improvements make their mark.

7. Look at the product. Take a fresh look at the product. Did your improvement make a difference? Is the product better? If it is, look for new improvement opportunities. (And the cycle continues...)

Before we take a look at the push and structure of Six Sigma, let's go through a brief recap of the history of Six Sigma.