six sigma deployement plan: a case study

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@ 2015 AYAT A. SALEH, submitted as a part of the 'Quality, Reliability and Maintenance' course in the University of Warwick, United Kingdom

Six Sigma Deployment Plan- A Case Study

The purpose of this document is to show an example for Six Sigma Deployment Plan

in an imaginary beverage company called ABC Company. All the assumptions and

needed information about this company will be stated properly. The deployment plan

will follow the framework in figure 1.

Figure 1 Deployment Plan Framework

The deployment plan will be developed by firstly, analyzing the company's

background information in order to perform two types of analysis; Six Sigma

readiness assessment and risk assessment. Secondly, the results of the two

assessments will be qualitatively analysed to form the final deployment plan.

ABC Company's Profile

ABC is a subsidiary of an international company. The main aspects that affect the

elements of the deployment plan are shown in a mind map in figure 2.

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Figure 2 Company's Background – Mind Map

ABC Company's Readiness Assessment

In order to assess the Company's readiness for the Six Sigma journey, a questioner,

adapted from the International Institute for Learning, was filled. The results of this

assessment indicated that:

ABC is a doing great job in terms of listening to the voice of the customer,

however, there is still an area for improvement and Six Sigma can help in

that.

ABC needs to assign a Six Sigma champion to speed up this deployment

journey, train Green Belts and Black Belt, and can improve the decision

making process by building employees' capabilities in using advanced

statistical techniques.

ABC has an improvement opportunity in linking the existing performance

metrics with Six Sigma to gain better benefits.

The detailed readiness assessment is shown in Appendix A.

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ABC Company's Risk Management Plan for Six Sigma Deployment

According to the mind map in figure 2, ABC Company is functional- organization with

multiple organizational level. This creates bureaucracy and complicates the

communication channels. In addition, ABC’s local management reports to the

regional office and they are fully loaded most of the time.

ABC has strict financial procedures where the budget is very difficult to be exceeded;

therefore, any extra spending should be requested in advance.

ABC depends on many low- skilled operators with a low- level of education, In

addition, the other highly skilled employees (Engineers, Accountants..etc) lack of

Problem Solving Skills and Statistics. Employees’ turnover is within the acceptable

limit, however, there is always a risk of losing key employees.

Every employee has clear job description, so it is very difficult to be engaged with

extra tasks unless they are aligned with the management and communicated in

advance.

ABC has SAP (Systems, Applications and Products) so it has a good history for five

year go, and all KPIs (Key Performance Indicators) are tracked and communicated

on a timely basis.

In order to seize the fruits of Six Sigma gradually, and to ensure that there will not be

any interruption for the other improvement programs in the company, the Six Sigma

journey will be deployed over three years. Year 1 starts with Kaizen projects since

the company doesn't have a well-established Six Sigma program in place. In year 2,

Green Belt projects will be introduced in addition to resuming the Kaizen project. In

the final year, the company will start Black Belt projects besides the Green Belts and

Kaizen projects.

This approach will help to create a positive culture around Six Sigma and lean

philosophy, reducing the resistance to change and building trust. As a result, ABC

can benchmark its performance against other similar companies with a confidence

that its performance is improving consistently.

According to the readiness assessment and the above discussion, the risks

associated with Six Sigma deployment were grouped under eight categories:

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1. Organization's Culture 5. Time

2. Six Sigma Infrastructure 6. Information System

3. Projects' Selection 7. Communication

4. Cost 8. Monitoring and Control

The detailed risks and mitigation plans for each risk category are shown in table 1.

Table 1 Six Sigma Deployment- Risk Management

Risk Mitigation Activities Related

Documents

1- Organization's Culture

Lack of management commitment

in terms of attending the meetings,

communicating the right message

at the right time, proving the

sufficient resources (financial,

people, time..etc.) and resolving

conflicts.

Provide specific training for

senior management

Provide clear schedule for the

type of support needed from the

senior management

Keep them engaged in all stages

Training plan

Six Sigma

deployment

timeline

Resistance to change and

resistance to implement the new

proposed solutions because of the

fear of losing jobs, unclear

expectations..etc

Provide cultural-change training

to all employees

Communicate clearly the

purpose of the program and the

progress along the journey

Create and communicate a

reward and recognition program

Training plan

Communication

plan

HR plan

Lack of clear roadmap that links

the Six Sigma efforts to the

company's mission, visions and

values.

Provide a framework for projects'

selection and show the link to the

company's' strategy

Projects'

selection

framework

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Documents

2- Six Sigma Infrastructure

Lack of resources in terms of:

champion, sponsors, Black Belts,

Green Belts, finance department

representative, HR representative

and IT representative. This will

slow down the implementation of

the deployment plan and will affect

the quality of the outputs.

Designate officially Six Sigma

champion and projects'

sponsors.

Hire full- time Black Belts and

Master Black Belt.

Provide official nomination for

the needed Green Belts and

other departments’

representatives per each project.

Official roles

and

responsibilities

for the

champion and

the projects'

sponsors

should be

mentioned in

the Six Sigma

kick- off

meeting

HR plan

Team's turnover which may result

in losing the key personnel in the

deployment plan. Eventually, this

will slow down the implementation

and may increase the costs when

looking for replacement.

Provide rigorous hiring and

selection criteria for the Black

Belts and the Green Belts.

Provide clear career- path for

those Belts.

HR plan

Current educational level and skills

which may be insufficient to

implement the Six Sigma journey.

Provide inclusive training

program that includes: Six

Sigma, statistics, project

management and soft skills.

Training plan

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Documents

3- Projects' Selection

Unclear projects' selection criteria

which may result in engaging the

tam in different projects that are not

aligned with the company's

strategy, or suffering from scope-

creep during the implementation.

Utilize projects' selection

framework that links the projects

to company's strategy.

Projects shall be approved by

finance manager and champions

in advance.

Ensure that each project has

sponsor who is responsible for

the continuous monitoring for his/

her project.

Projects'

selection

framework

HR Plan

4- Cost

Lack of fund to cover the hiring and

training expenses and the capital

expenditure for the nominated

projects. This will hinder the

fulfilment of the deployment plan or

could slow it down until getting the

fund

Provide detailed cost-benefits

analysis to rationalize the

needed fund for Six Sigma

journey

Provided detailed yearly

breakdown for the needed fund

Ensure getting the financial

manager’s approval for the plan.

Cost benefits

analysis

5- Time

People may be overloaded with

other tasks which will affect the

timeline and the quality of their

outputs

Hire the needed number of

resources

HR plan

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Documents

There might be too many projects

to implement without clear priorities

which will affect the implementation

of the plan

Provide timely-phase plan over

three years and have prioritized

list of projects

Six Sigma

deployment

timeline

6- Information System

Lack of data which may create

difficulties in baselining the current

level of performance and figuring

the improved performance later on.

This risk is currently low because

ABC company has SAP

(systems, Applications and

Products) software for five years

ago and all historical data is

available

-

The current measurement system's

capability in terms of bias, linearity,

stability, repeatability and

reproducibility.

Conduct full measurement

system analysis before

commencing the deployment

plan

Accuracy of company's data

capturing system will be checked

one by one according to each

identified project/ initiative

-

7- Communication

Lack of communication about the

deployment plan which may cause

resistance to change, unclear

expectations, receiving wrong

information, distributing project

information to track progress..etc

Develop detailed communication

plan that covers the needed

reports and meetings

Communication

plan

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Documents

8- Monitoring and Control

Failing to meet the management

expectations about the Six Sigma

deployment because of the

deviation from the deployment

plan, as a result the financial

benefits will not be granted.

The performance will be

reviewed using a balanced score

card and information will be

shared as per the

communication plan

Champion will review the

deployment plan regularly to

ensure its applicability and

amend it when needed

Conduct benchmark for ABC

performance against similar

companies.

Performance

tracking plan

Communication

plan

ABC Company's Six Sigma Deployment Plan

The Six Sigma deployment plan consists of eight parts which are the critical success

factors for ABC Company as shown in figure 3.

Figure 3 ABC Company's Critical Success Factors for Six Sigma Deployment

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Part 1: Linking Six Sigma to Company's Strategy

Implementing Six Sigma in ABC is aligned with the company's vision and strategy in

which it will help in the following:

Productivity: generate saving of 740,000 USD within three years journey.

The detailed financial benefits are illustrated in Appendix B.

People: build employees' capabilities in utilizing different tools and

techniques in their daily operations. By the end of the third year, ABC will

have one Master Black Belt, one Black Belt, 10 Green Belts and 15 Kaizen

Leaders.

Efficiency: streamline the company's operations by reducing the cycle time,

eliminate the non-added value actives and drive the processes to a best

performance.

Customers: sustaining the great customers' results and ensuring agile

response against any changes in the market.

Culture: creating a new mind- set where all employees can participate in lean

Six Sigma implementation because of its nature in adapting a bottom- up

approach.

Part 2: Projects Selection Criteria

The success of this journey depends on selecting the right projects that are linked to

the company's vision and strategy. Pyzdek and Keller (2010, pp. 118) suggested

using Business Process Maps and Flow Charts. In ABC Company, projects will be

selected as per Projects' Selection Framework in figure 4. The company will spot

ideas for Six Sigma and Kaizen projects using Value Stream Mapping and SIPOC

diagram (Suppliers, Inputs, Process, Outputs and Customers).

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Top management/ senior management spot the hot

areas that hinder them from achieving their plans

Champion reviews the areas and assign Master Black

Belt and/ or Black Belts for Value Stream Mapping and

SIPOC workshops which are conducted at planned

intervals during the year

Master Black Belt and/ or Black Belts conduct Value

Stream Mapping and SIPOC workshops for each of the

identified processes to pinpoint value/ non-added value

activities/ variation and send their recommended

initiatives to finance team

Finance team along with subject matter experts quantify

the financial impact for each of the suggested initiatives

and form "Projects Shortlisted" for the feasible ones

Champion review the "Projects Shortlisted" with top

management to prioritize them based on a "Decisions'

Selection Matrix" that will be developed for this purpose

Top management formulates the company's strategic

plan that supports the company's vision and mission for

the next five year. The Plan is updated annually

Champion will assign project sponsors and together will

assign the projects managers for each project

Project managers are responsible for selecting the right

team members

Senior managers develop the annual operating plan that

is aligned with the strategic five years plan

Project passed the

decisions criteria

No

Yes

Update

th

e a

nnu

al pla

n a

ccord

ingly

to r

eflect th

e n

ew

pro

jects

Start

End

Figure 4 ABC Company's Six Sigma Projects' Selection Framework

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Part 3: Performance Monitoring

The company will utilize Balanced Scorecard to track the performance of the Six

Sigma journey. The four aspects of this scorecard and the detailed matrices are

shown in table 2.

Table 2 ABC Company Six Sigma Performance Scorecard

Objective KPI/ Measure Target Actual Initiatives

Fin

ancia

l

Generating saving out of

the Six Sigma

deployment effort

Total expenses to total saving related to Six Sigma (Ratio)

TBD Lean Six Sigma

projects and initiatives

Total capital expenditure to total saving related for Six Sigma (Ratio)

TBD Lean Six Sigma

projects and initiatives

Total expenses related to Six Sigma training (USD)

225,000 Training program

Total expenses related to Six Sigma reward and recognition (USD)

125,000 Reward and

Recognition Program

Custo

mer

Sustaining the

competitive position of

ABC

Satisfying the company's

management

"time to sell" measure (Minutes) TBD Kizen Project

"go to market" measure (Minutes) TBD

Kizen Project

Green Belt Project

Management satisfaction about Six Sigma implementation

TBD

Questioner designed specifically for this purpose

Inte

rna

l P

rocesses

Implementing the lean Six

Sigma projects and initiatives on time and as per budget

Number of projects on time TBD Time Performance

Index calculations

Number of projects on budget TBD Cost Performance

Index calculations

Cycle time of process X (minutes) TBD Six Sigma green belt

project

Management engagement in the Six Sigma deployment

TBD Questioner designed

specifically for this purpose

Effectiveness of Six Sigma communication and employees engagement

Questioner designed

specifically for this purpose

Learn

ing

&

Gro

wth

Building ABC team's

capability in lean Six Sigma

Number of certified Kaizen Leaders 15 Training program

Number of certified Green Belts 10 Training program

Number of certified Black Belts 1 Training program

Number of training hours per employee (Hours/ Employee)

1 Training program

Part 4: Human Resources (HR)

Implementing this plan effectively depends on having the proper human resources.

The detailed HR plan is shown in tables 3 to 5 which cover:

The hiring guidelines;

Roles and responsibilities for each one involved in this journey; and

The proposed reward and recognition for the Six Sigma program

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Table 3 ABC Six Sigma Hiring Guidelines

Role Quantity Qualifications Needed

Master Black

Belt Manager

1 candidate in the

first year

At least 5 years of experience in the role of a

Black Belt*.

Soft skills: teaching, coaching, mentoring,

communication and innovation.

Advance project management skills.

Black Belt 1 candidate in the

third year

At least 3 years of work experience in one or

more areas of the Black Belt Six Sigma Body of

Knowledge*.

Soft skills: teaching, coaching, mentoring,

communication and innovation.

Advance project management skills.

Green Belt 5 candidates in

the second year

and 5 candidates

in the third year

Soft skills: leadership, problem solving and

communication.

Basics project management skills.

Kaizen Leader 5 candidates

each year

Basics project management skills.

Soft skills: leadership, problem solving and

communication

Projects Team

Members

As per the

projects

Soft skills: communication, time management and

cooperation.

Technical skills as per the assigned projects.

* Source: ASQ (American Society of Quality) available on the WWW at:

http://asq.org/. [Accessed in 1st December 2015].

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Table 4 ABC Company Six Sigma Roles and Responsibility*

Role Responsibility

General Manager Communicate the importance of Six Sigma journey in the annual

employees' meeting.

Illustrate the link between Six Sigma journey and the company's vision and

strategy.

Ensure the availability of resources (financial, human resources and

infrastructure).

Approve and authorize the Six Sigma deployment plan.

Approve the assignment of champion and sponsors.

Attend the required training as per the "Training Assignment Matrix".

Departments

Directors

Support the reward and recognition program.

Provide the need support in his/ her department.


Functional

Managers

Provide the needed resources for the Six Sigma projects.

Act as subject matter expert.

Ensure the implementation of the proposed solutions.


Champion Develop the Six Sigma deployment plan.

Liaison with finance manager and top management to ensure selecting the

right projects.

Participate in hiring the Master Black Belts and Black Belts, in addition to

selecting the internal Green Belts and Kaizen Leaders.

Monitor the performance of all Six Sigma players.

Communicate the Six Sigma journey internally and externally.

Support the reward and recognition program.


Sponsors Provide the needed support to his/ her project.

Review the progress of the project to ensure that that is no scope crepe

and the project will deliver its objectives on time.

Coach, mentor, and solve any problems raised by the project manager.

Authorize the project charter.


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Table 4 ABC Company Six Sigma Roles and Responsibility*

Role Responsibility

Master Black

Belts

Mobilize the reward and recognition program.

Coach, mentor, and support any issues raised by the Black Belts.

Certify the Black Belts, Green Belt and Kaizen Leaders.


Black Belts Implement the assigned Six Sigma Black Belt project.

Coach, mentor, and support any issues raised by the Green Belts.


Green Belts Implement the assigned Six Sigma Green Belt project.

Work with function heads to ensure the availability of the right team

members.


Project Team

Members

Participate actively in the assigned projects as per the required tasks (such

as: data collection, analysis, act as a subject matter expert..etc).


*Source: The Six Sigma Handbook (Pyzdek and Keller, 2010, pp. 19)

Table 5 ABC Company Six Sigma Reward and Recognition Program

Reward and Recognition Type

Audience Criteria

Free lunch inside the facility Team members Other employees who support

the project in his/ her department

As set by the project manager

Celebration in external venue

Kaizen Leaders/ Green Belts/ Black Belts/ Master Black

Belts

Meeting project goals by year end as evaluated by the champion

Monthly nomination for "Employee of the Month" with Free Shopping Coupon

All employees As set by the Master Black Belt and Champion

Professional Certificates Green Belts and Black Belts Implementing the assigned project as evaluated by the Champion and

the Master Black Belt

Part 5: Training

In order to ensure smooth implementation, different training courses and events

should be introduced covering all employees and the detailed training plan are shown

in table 6 and 7 respectively.

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Table 6 Six Sigma Training Plan in ABC Company

No. Course Name Description Delivery Method Duration Frequency

1 Six Sigma Awareness Event General awareness about Six Sigma and lean philosophy covering all employees. The training should introduce the concepts using fun activities and will be delivered in the local language (Arabic)

Event in internal venue

3 Hours Monthly to cover all employees in the first six

months

2 Master Black Belt Course Dedicated training for Master Black Belts candidates that cover the body of knowledge in that area, and advance soft skills

Class One month Once and whenever there is a change in that role

3 Black Belt Course Dedicated training for Black Belts candidates that cover the body of knowledge in that area, project management skills, and soft skills such as mentoring and coaching.

Class 20 days For each new wave

4 Green Belt Course Dedicated training for Green Belts candidates that cover the body of knowledge in that area and project management skills

Class 5 days For each new wave

5 Basics Statistics and Problem Solving Tools

Introduction to the basic statistics and problem solving tools. The training will be provided in the local language and cover all employees who need data analyse in their daily work. In addition, all Kaizen Leaders/ Green Belts/ Black Belts should attend if they don't have those basics.

Online 3 days Semi Annual

6 Advanced Statistics and Problem Solving Tools

Advanced statistics and problem solving tools dedicated for Black Belts and Green Belts if they don't have this knowledge. The training will be provided in English.

Online 3 days For each new wave

7 Management by- in Event An event to introduce the Six Sigma and lean philosophy to the management to ensure management by-in, support and continuous engagement.

Event in external venue

4 Hours Annually

8 Champion Training Dedicated training for the champion covering soft skills such as: mentorship, conflict management, and communication skills

Online or by external training

provider

2 days Once and whenever there is a change in that role

9 Sponsors Training Dedicated training for the sponsors covering project management skills, mentoring, and coaching

class delivered by the champion and/or external training provider

5 hours Once and whenever there is a change in that role

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Table 7 ABC Company Six Sigma Training Assignment Matrix

No. Course Name

Employees Groups

Top

Management

Master

Black

Belts

Black

Belts

Green

Belts Champion

Projects

Sponsors

Process

Owner

Projects

team

Members

All other

employees

1 Six Sigma Awareness Event √ √ √ √ √ √ √ √ √

2 Master Black Belt Course √

3 Black Belt Course √

4 Green Belt Course √

5 Statistics Basics and Problem Solving √ √ √ √

6 Advanced Statistics and Problem Solving √ √

7 Management by- in Event √ √ √

8 Champion Training √

9 Sponsors Training √

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Part 6: Communication

Different information will be aggregated from weekly and monthly meetings. This

includes:

Six Sigma Dashboard

Projects Status Reports

Balances Scorecard

Financial Tracking

Tone from the top about vision, strategy and Six Sigma.

Detailed communication methods, responsibilities and frequency are in table 8.

Table 8 ABC Company Six Sigma Communication Plan

Communication

type

Audience Form of communication Responsibility Frequency

Six Sigma

Dashboard

Project Team Billboard in a meeting room to

be discussed by each project

manager with his/ her team

during the weekly team

meeting

Project

Manager

Weekly

Projects Status Sponsor and

Master Black

Belt

A3 report to be discussed by

the project manager during the

weekly meeting with his/ her

sponsor and the Master Black

Belt

Project

Manager

Weekly

Balances

Scorecard

Top

Management

PowerPoint presentation to be

discussed in a meeting

Master Black

Belts

Monthly

Financial

Tracking

Top

Management

Excel Sheet Report to be sent

via e-mail

Financial

Manager

Monthly

Tone from the

top about visions,

strategy and Six

Sigma

All

employees

Speech and E-mails to be

circulated regularly to ensure

engagement

Top

Management

and

Champion

During the kick

off meeting

and Quarterly

e-mails

Part 7: Leadership Role

The engagement of the company's leadership in Six Sigma deployment is one of the

main critical success factors, whereby It is not a single event; it is a continuous

mission starts early in the initial phase and continues throughout the journey.

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As outlined in the previous parts, the engagement is fulfilled in two directions. On the

first hand, managers shall play specific roles and responsibilities as defined in the HR

plan including but not limited to: setting tone from the top about the benefits of Six

Sigma, providing the needed resources whether the financial, human resources or

even the infrastructure, providing official nomination for the Six Sigma champion and

projects' sponsors, supporting the reward and recognition programs, attending

specific training as per the "training assignment matrix" and participating in the

"projects selection framework".

On the other hands, by linking the Six Sigma deployment with the company's vision

and strategy, managers can rest assure that this effort will advance the company's'

performance. Accordingly, managers shall receive regular updates about Six Sigma

progress through the balanced scorecard in table 2 and the detailed roadmap over

three- year’s journey.

Part 8: Cultural Change

Employees' resistance to change is avital obstacle in Six Sigma deployment. The

proposed deployment plan shall overcome this by addressing three points. Firstly,

implementing specific actions such as cultural-change training, a reward and

recognition program dedicated to reward the Six Sigma performance, providing clear

communication for the expectations in terms of their roles and responsibilities, and

empowering employees to be part of the Six Sigma projects and its career path.

Secondly, the proposed plan will be implemented over three years so everyone can

be engaged at the right pace. Finally, the projects are always linked to the company's

strategy to ensure that there is no contradiction with the other projects and initiatives

in the company.

Part 9: Implementation Roadmap

The timeline for the major events is shown in figure 5 and the detailed timeline is in

table 9.

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Figure 5 ABC Company's Six Sigma Plan

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Table 9 ABC Six Sigma Implementation Timeline

Year Q1 Q2 Q3 Q4

2016

Communicate the

following:

Projects selection

framework

Training agenda

Roles and

responsibilities

Conduct first VSM

sessions

Conduct management

training topics

Kaizen Leader Training

Communicate the reward and

recognition program

Awareness and cultural- change

training

Kaizen Leaders

Implementation

VSM Workshop

Award kaizen Leaders

Certificates

2017

Hire Black Belt

Green Belt Training

VSM Workshop


Green belt Implementation

Kaizen Leaders Implementation

Refresh training

VSM Workshop Award Green Belts and

Kizen Leaner Certificates

2018

VSM Workshop

Green Belt Training


Green Belt Implementation

Kaizen Leaders Implementation

Black Belt implementation

Refresh training

VSM Workshop Award Black Belts, Green

Belts and Kizen Leaner

Certificates

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References

American Society for Quality. Available at the WWW on http://asq.org/index.aspx [Accessed in

1st December 2015].

Pyzdek, T. and Keller, P. (2010). The Six Sigma Handbook. 3rd ed. New York: McGraw-Hill

Companies.

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Appendix A- ABC Company's Six Sigma Readiness Assessment

Source: International Institute for Learning, Inc. available at the WWW on:

https://www.iil.com/leansixsigma/getlean/Six_Sigma_Readiness_Assessment_Tool.xls.

[Accessed in 1st December 2015].

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Appendix B- ABC Company's Six Sigma Cost- Benefits Analysis

This appendix shows the costs and benefits associated with the Six Sigma journey

First: Expected Benefits

The company will launch 5 Kaizen projects in the first year. Each one is expected to

save 25,000 USD. In the second year, the company will start Green Belt projects,

each one is expected to generate saving of 50,000 USD alongside the other five

Kaizen projects. In the third year, the company will implement two Black Belts

project, each is expected to save 100,000 USD, in addition to implementing another

five Kaizen projects and five Green Belt Projects. The total saving by the end of the

third year is as the following:

Table 0.1 ABC Six Sigma Deployment Financial Benefits

Year Kaizen Projects (25,000 USD

Saving)

Green Belt Projects

(50,000 USD Saving)

Black Belt Projects (100,000 USD

Saving)

Expected Saving (USD)

1 5 0 0 125,000

2 5 5 0 375,000

3 5 5 2 575,000

Total benefits by end of third year 1,075,000

Second: Expected Costs

The costs needed for the Six Sigma journey are shown in the below table:

Table 0.2 ABC Six Sigma Deployment Financial Costs

Item Required from Yearly Costs (USD) Total Cost (USD)

Consulting and training costs

First year to third year 50,000 USD in the first year 75,000 USD in the second

year 100,000 USD in in third

year

225,000

Hiring Master Black Belt in the first year

First year to third year 60,000 180,000

Hiring Black Belt in the third year

Third year 35,000 35,000

Reward and recognition program

First year to third year 20,000 USD in the first year 40,000 USD in the second

year 60,000 USD in in third year

120,000

Total costs by end of third year (USD) 335,000

Total expected revenue by end of the third year is 740,000 USD