Implementing a Six Sigma Initiative Within a Small Business

Implementing a Six Sigma Initiative Within a Small Business

For decades, the Six Sigma methodology was limited to large companies who had the resources to support a wide-scale deployment. Multinational corporations such as Toyota, 3M, Motorola, and General Electric integrated the process improvement system while small companies were largely kept in the dark. That dynamic has changed dramatically over the past several years. Organizations with fewer than 100 employees (and some with as few as 20) are taking advantage of Six Sigma to streamline their operations. In doing so, they’re achieving higher levels of competitiveness while improving their bottom line.

Below, we’ll take a look at implementing the methodology from the perspective of the small business owner. There are hurdles that smaller organizations must contend with, as well as advantages they enjoy over their larger competitors. I’ll describe both. I’ll also briefly explain the basics of executing the DMAIC process within a small business, and how size can form a powerful lever for generating results.

Implementation Hurdles For Smaller Organizations

The main obstacle small businesses face when deploying a wide-scale Six Sigma initiative is a lack of resources. Large companies tend to have bigger budgets. That means they can afford to train in-house Green Belts and Black Belts. They can afford to assemble teams that include Master Black Belts and Champions who can oversee projects.

Smaller organizations seldom have these resources at their disposal. Cash flow tends to be tight, so allocating a large budget toward a full deployment is often beyond their ability. That usually means they are unable to support Master Black Belts and Champions. In many cases, they may also be unable to afford keeping a team of Green and Black Belts on staff. That limits their flexibility.

Advantages Enjoyed By Smaller Organizations

While it’s impossible to ignore the hurdles with which small businesses contend when deploying a Six Sigma initiative, their size also offers advantages. For example, change often comes slowly to large companies. By contrast, process changes can happen quickly within a smaller organization. So too, is implementation handled more quickly. There are fewer layers of management and fewer departments from which to get buy-in.

Also, because smaller companies tend to have flatter managerial hierarchies, the executive leadership is often more involved than the senior management of large companies. That accelerates the decision-making process, which is critical to the success of a Six Sigma assignment.

Executing The DMAIC Process

The 5-step system by which a Six Sigma team reviews processes and implements changes is known as the DMAIC process. Despite budget shortfalls, this is not the area in which small business owners should cut corners. The system is carefully designed to yield results.

DMAIC stands for Define, Measure, Analyze, Improve, and Control. During the first step, objectives must be identified and projects must be chosen based upon their level of impact. During the Measure stage, Green Belts and Black Belts isolate the inputs and metrics to review. Next, the team analyzes the data to identify areas in which inefficiencies and defects exist. During the Improve stage, the Six Sigma team focuses on solutions that can eliminate inefficiencies given the organization’s limited budget. Lastly, the team’s solutions are implemented and analyzed in order to study their effect.

Faster Deployment And Larger Leverage

Even though Six Sigma has long been the exclusive domain of large organizations, small businesses can enjoy the same process-related advantages. Because of their smaller size, projects can be executed more quickly. Their streamlined managerial structure allows the effects to have a greater impact upon the entire organization. Their smaller staff adjusts more quickly to the changes. And newly achieved efficiencies carry a larger impact on the small company’s bottom line. While there are hurdles, the benefits make the Six Sigma effort worthwhile.

BMGI, a leading education and consulting firm in the lean six sigma education field regularly posts information on six sigma at http://www.bmgi.com