Innovate Small Business Growth with Six Sigma

As a small business owner, what are your long-term goals? Grow your customers, broaden sales, delegate to management, sleep eight blissful hours in a row for just one night … and implement a comprehensive process-improvement methodology?

If the first four are on your list, then the last one definitely should be. Here’s the quick-and-dirty guide to kick your business into gear with Six Sigma.

Six Sigma

Two pervasive untruths often dissuade small business owners from exploring Six Sigma, the set of quality-control processes developed at Motorola in the 80’s and popularized by GE in 90’s: Six Sigma is just for big businesses; and Six Sigma is really, really complicated.

Ditch the myths. In fact, the essence of Six Sigma is simple: every facet of business operations, strategy, and management is a process; every process consists of discrete steps. Identify, refine, and revise each step, and you grow your business (and your nightly pillow-time).

Your Customers

Six Sigma was originally conceived in a manufacturing environment, and the term itself refers to a statistical metric for calculating and eliminating defects in a manufacturing process. A process achieves Six Sigma Quality (i.e., statistical near-perfection) when only 3.4 errors are present per million opportunities for error.

What makes Six Sigma applicable to business environments other than the warehouse hinges upon its definition of a “defect” as any process output that does not satisfy customers. Therefore, the primary function of Six Sigma is always to document, define, and improve all business processes inherent to customer satisfaction—and growth.

Your Business

Because Six Sigma is process-oriented, your business architecture, or the environment and employee infrastructure in which business processes occur, is important. If your staff is comprised of collaborators who already understand each other’s roles and relationships, then your business architecture should be easy to diagram and your employees ready to adopt a quality-management methodology. However, if your company architecture is fractured, incentives and additional training may be necessary in order to facilitate start-up.

Although Six Sigma is by no means impenetrable, it is an investment, just like your business itself. Be prepared to dedicate essential resources, including time, staff members, and money. You may want to enroll your staff in Six Sigma training (while supporting them with temporary help), or it may make more sense to bring in an outside expert. Whichever you choose, keep in mind that the success of your implementation will pivot upon how well you understand not only Six Sigma, but also your own business.

Your Data

The biggest pitfall small business owners encounter when adopting Six Sigma is over-reliance on data acquisition or documentation, rather than application. The size, structure, and nature of your business will, to some extent, determine the statistical metrics and software you adopt, but all the data you cull will revolve around the following categories, correlative with each step in any business process (SIPOC):

  • Supplier—Whomever initiates the customer-satisfaction process; any source of input
  • Input—Any information relevant to the implementation of the customer request
  • Process—The series of steps undertaken to satisfy the customer request
  • Output—The good, service, or information provided to the customer
  • Customer Impact—The degree of customer satisfaction with process output

Securing this data is critical, but the acronyms and terminology ought not to obscure their common feature: the customer. Any and all data collected will prove irrelevant if interpreted independent of customer satisfaction.

Your Incentive

Still not convinced that Six Sigma process-management methodologies are the way to grow your customers? If the prospect of eight uninterrupted hours of sleep didn’t do the trick, perhaps these final tidbits will.

According to the 2008 U.S. Census, there were almost 200 times more employer firms (i.e., small businesses) with 1-4 employees than those with 500+ employees. Two years earlier, author and Six Sigma consultant Greg Brue estimated that most businesses lose around 25% of their revenue to process defects in Six Sigma for Small Businesses.

Put simply, that’s a whole lot of money going down the drain every day—which is enough to give any small business owner nightmares.

image credit: equinoxcreative.com

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Innovative and Interactive Learning Ryan Sauer is an innovation and Six Sigma enthusiast. He writes about innovation on topics such as project management, business analysis, and Six Sigma. Through University Alliance, he strives to help professionals achieve their goals and provide access to the information they need to achieve them.

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3 Responses to Innovate Small Business Growth with Six Sigma

  1. Braden Kelley says:

    If you enjoyed this article, you might also enjoy:

    http://www.innovationexcellence.com/blog/2011/06/27/dmaic-for-innovation/

    My article about innovation through a Six Sigma lens.

    All the best,

    Braden
    @innovate

  2. k suresh says:

    Good thoughts on the use of six sigma, along with the points mentioned Benchmarking the operations of the organization will help a business grow.Just read an informative whitepaper on Benchmarking with useful information that readers will find useful @ http://bit.ly/Q7tSFn

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