What is Six Sigma? It all begins with an important metric. And that metric is Defects Per Million Opportunities or DPMO. DPMO is a scientific measure and a way to calculate the number of potential mistakes or defects we get when we provide a product or service. This DPMO metric sits inside the organizational system within which Six Sigma operates. The next part of this system is called the improvement methodology. And the phrase for that is called DMAIC, which translates as define, measure, analyze, improve and control. This improvement methodology in addition to the metrics is part of an overall organizational system, within which we use Six Sigma to improve business processes of all types. So why Six Sigma? Well, for one reason, there’s a definite proven track record. The Six Sigma term was popularized by General Electric and Motorola back in the 1980s and 1990s. But the reality is Six Sigma has been widely adopted by industry leaders of all kinds in all industries. The Six Sigma basic techniques have been in practice for nearly 100 years.
Six Sigma provides a very good toolkit and methodology to accomplish a number of things. Six Sigma is not limited just to manufacturing, which is the industry where it was born. This methodology has been successfully deployed in every kind of business. Profit, non-profit, government, financial services and manufacturing are examples of industries that benefit from the application of Six Sigma. There are a number of benefits to any organization from using Six Sigma and we’re going to talk about that next. All industries, whether they are for profit or not, are concerned with operating costs. All organizations must consider revenue now and in the future. So bringing down cost and bringing cost under control is always critical. Six Sigma has been a very effective method to accomplish this by using proven methods to reduce the cost of quality over time. Another key component is driving customer satisfaction. Six Sigma initiatives that are being implemented the right way are focused on the voice of the customer and also focused on making changes that reduce variation, reduce inefficiencies and improve quality in our processes. Another benefit to this is that we can improve the net profits and the company’s value over time, and that’s a good thing. Organizations that are focused on making money now and in the future need to leverage techniques like Six Sigma to ensure a long-term success and viability while never losing their focus on the customer.