Six Sigma–The 8 Stages of The Breakthrough Strategy at the Business Level

In the seventh chapter of their book Six Sigma:  The Breakthrough Management Strategy Revolutionizing the World’s Top Corporations, the authors Mikel Harry, Ph.D., and Richard Schroeder get to the “meat” of the book by explaining what the Six Sigma Breakthrough Strategy consists of.   Before explaining the stages of the strategy, the authors related the three levels of the strategy:   the business level, the operations level, and the process level.   This is covered in the previous post.

In this post, we cover the 8 stages of the implementation of the Six Sigma Breakthrough Strategy at the Business Level.  As mentioned in the previous post, the strategy is implemented at a business level by a Deployment Champion, and the application of the strategy may take place over a 3-5 year period if it is to be done in a consistent and focused manner.

1)  RECOGNIZE … the true states of your business

The “states” of a business are the global business conditions used to guide and manage a business.   These could be “levels of customer satisfaction”, for example, which impact the economics of a business.   Knowing this can help a company leverage its efforts and resources to improving customer satisfaction, which will in turn impact the bottom line of the business in a positive way.

2)  DEFINE … what plans must be in place to realize improvement of each state

Let’s assume that “levels of customer satisfaction” is one of the “states of business” that is being considered for improvement.   What parts of the company’s organization are correlated to this state?   Is it the manufacturing system, the engineering (design) system, the delivery system or the service system?    Are there characteristics of these systems which are critical to quality (in the sense of customer satisfaction)?

3)  MEASURE … the business systems that support the plans.

The first question here is to ask “what” to measure, and then the second question to ask is “how” to measure it.  The third question to ask is “is there executive (management) commitment to go after the right measurements?”

4)  ANALYZE … the gaps in system performance benchmarks.

Let us say that a company analyzes its own performance in an area and finds that it is operating at a 3.4 sigma level.   Let’s  say that the company has analyzed a competitor which operates in the same or similar area at a 4.6 sigma level.  What is that other business doing that makes its performance better?

5)  IMPROVE … system elements to achieve performance goals.

Once the system that needs to be improved has identified those elements which comprise it, a company then needs to identify those elements which need to be improved first, which are considered to be most likely those that will affect quality.  This ensures that the company’s resources spent on Six Sigma projects to improve those elements are getting the most “bang for the buck.”

6) CONTROL … system-level characteristics that are critical to value

Once an improvement is identified and proved with Six Sigma techniques, then it is important to monitor and control this solution over a period of time to make sure that it is a permanent solution and that the system does not fall back into previous patterns, which could cause the gains made in the previous stage to erode over time.

7) STANDARDIZE … the systems that prove to be best-in-class

Let’s say that a system element is improved and then controlled so that the improvement is permanent.  Once the element is shown to be “best-in-class”, it can then be replicated, where applicable, in other business units to amplify the improvement throughout the entire company.

8) INTEGRATE … best-in-class systems into the strategic planning framework.

Once the best-in-class systems have been adopted on a business-wide basis, then the strategic planning framework needs to take them into account.  This business-wide improvement is then the new “state of business.”

Essentially, the process has come full circle and it is time for another iteration of the 8 stages of the breakthrough strategy, but with the results of the previous cycle being the basis for the next round of breakthroughs.

For example, if previous efforts have been made towards reducing manufacturing defects, the company may then alter the strategic planning framework so that the next phase of improvement tries to focus on reducing those design defects that produced the manufacturing defects in the first place.

This is how the business continuously improves and at the same time coordinates that improvement within all levels of the organization.    From this bird’s-eye view of the business, we next go to the operations level of the Breakthrough Strategy, which is the subject of the next post.


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