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What is Six Sigma?

Strong Project Sponsorship and Chartering are Key to Successful Six Sigma Projects

Having conducted internal corporate Lean and Six Sigma projects as well as external client initiatives, I have concluded that strong project sponsorship and project chartering are key components for a successful Six Sigma project. Regardless of how good the Green or Black Belt’s skills are, if these components are not in place the project’s cycle time, goal attainment and acceptance will be limited.

Unfortunately many organizations have been sold on Six Sigma as a quick fix to internal organizational issues. The real benefit that Six Sigma brings to an organization will only be seen over time. Therefore, if corporate commitment to Six Sigma is not in place it may pass away as the latest fad of business improvement strategies. In order to prevent Six Sigma’s demise it is essential for the methodology to be properly implemented, practiced and supported. The quality of the methodology will only be maintained with positive project results. Here are two key components to ensure the quality of the methodology and deliver positive project results.

Strong Project Sponsorship

The first and most important stone to be laid for a successful Lean or Six Sigma project is strong project sponsorship.

Sponsorship of any change initiative must come from leadership positioned high enough in the organization to approve changes determined necessary by the data to meet the project’s objective.

Example #1: I once conducted a project focused on reducing the cycle time to renew client contracts. The project was sponsored by a Director of Operations who owned divisional responsibility for account retention. This sounds good, but one key finding the project team identified was the necessity for sales to change their process and behavior. Unfortunately the sponsoring director had no authority over sales who contributed to 30% of the cycle time. Needless to say this project stalled at the improve phase when our sponsor was unable to get the support from sales.

The end result was that instead of saving the company $250,000 per year in unbilled revenue we cost the company $18,000 in project team resources. This is a classic case of sponsorship at a level too low to execute necessary change.

Project sponsors also need to have an honest interest in the problem being solved. In many organization projects are commissioned at a senior management level and parsed out to mid level managers to sponsor. In theory this sounds good, however this does not ensure project acceptance. The problem results from sponsors not having ownership of the problem or confidence in a methodology they are ignorant of. Without strong sponsor support, the project’s progress will suffer. With properly positioned and committed sponsorship challenging projects can deliver significant benefits.

Example #2: While leading a Lean Six Sigma project for an external client with Senior Leadership sponsorship I encountered a roadblock between two associate VP’s. Each Associate VP organization held resources capable of delivering the service required for this account. The labor costs for the team who initially delivered the service was 25 times higher than the customer was willing to pay. Additionally travel was required for them to meet with the client. Conversely, the local team possessed the capability to deliver the work at half the cost and be onsite with the client without travel expense. Having senior level sponsorship allowed the data to drive the decision on placement of the work. Strong sponsorship produced a 90% reduction in the cost and cycle time to produce each unit. This resulted in a $600,000.00 annual savings to the client and $80,000.00 in annual revenue to my organization.

Clearly Written and Defined Charter

There is an old saying in my family that you’ll never get any where if you don’t know where you’re going. This remains true in process improvements efforts as well. All too often the sponsor of a project comprehends the pain that needs to relieved, but has not received the requisite training to properly author a clear and well written project charter.

There must be a clearly definitions of the following charter components:

• Scope : Project failure is inevitable if the breadth of the project is too big. It is imperative to establish clear starts and stops to minimize misinterpretation or confusion in the mind of the stakeholders. If this step is not properly performed the scope of a project can simply be too broad. We call this “Boiling the Ocean”. A project’s scope should be firmly established BEFORE the project is ever launched. This will help avoid potential problems arising from ‘out of scope’ additions to the project. It also helps manage stakeholder expectations by clearly communicating what will and won't be delivered. Many projects are completed meeting or exceeding all goals and still be perceived as a failure by stakeholders. This will occur if the scope of the project has been misunderstood. Hence the stakeholders and/or sponsors benefit expectations were either unattainable or never targeted in the project. The project scope should only cover two to three Key Process Input or Output Variables. No one project can reasonable develop a process change with more than four Key Process Output Variables. When the scope encompasses more than three KPOV’s the project needs to be either divided into multiple concurrent projects or into sequential or multi-generational projects.

• Project Team Here is one of the most challenging and underappreciated areas in building the framework for a successful project. Many projects either have too many, too few or the wrong mix of representation on the team. It is essential to have a good mix of skill sets, roles and personality types on the project. Personality evaluation tools are excellent aids to gauge the cohesiveness and synergy of a team. By using one of these tools, the prospective team members from the projects’ stake-holding teams can be evaluated in advance. The results can then be used to build the team with the best potential synergy. This will improve the success of the team and the project. The rank or position of the team members also plays a key part. I once led a project with six team members all at the Director and Associate VP level. While this sounded like a great mix of players to produce change, the team had little availability to participate in meetings let alone perform the project tasks. Due to the amount of responsibility held by the team our cycle time and meeting attendance were both severely hampered.

• Time Table “Timing is everything.” This age old statement stands true in the Six Sigma world today. When building a project team little things like vacation, holiday schedules and peak work cycles must be taken into consideration. Launching a project for the accounting department at then end of the fiscal year will have some obvious challenges. This may sound elementary, but when projects are identified by leadership without local departmental visibility, these basic considerations are often missed. Small issues can become great bottlenecks to minimizing the projects cycle time.

By carefully and thoroughly executing these steps within the Lean and Six Sigma methodology substantial improvement in the project’s cycle time, goal attainment and acceptance can be achieved.

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Steven H. Jones is a Process Engineer who received his certification as a Lean Six Sigma Black Belt by the George Group while employed and Xerox Global Services. He started his career at the 3M Corporation, an early adopter of the Lean Six Sigma methodology in 1988 and has worked in quality improvement of Telecommunications and IT arenas since 1993. Since then he has provided quality improvement and process engineering services domestically and internationally to clients such as BP Canada, Convergys, Intercontinental Hotels, and Microsoft. He is currently a Senior Process Engineer with Siemens Business Services and can be reached at steven.jones@sbs.siemens.com.