Page 40 - Six Sigma Demystified

Chapter 1 d e p loy m e n t s t r at e g y 21

In most automobiles, gauges, connected to sensors, are provided to constantly
measure and report on critical precursors to unfavorable conditions. For exam-
ple, the temperature gauge, oil pressure gauge, and fuel gauge each provide
immediate feedback of impending problems. Better still, today’s cars include
electronic displays to indicate a drop in coolant level or tire pressure, providing
even more advanced notice of a potential problem.
Clearly, similar metrics are available to business processes for measuring
real- time precursors to meet or exceed key stakeholder expectations. These
metrics will provide input for data- driven decision making and communicate
the performance of the business or process relative to key goals and
objectives.
Effective dashboards should provide more than just single numbers or a table
of historical values. Instead, dashboards should provide clean and clear graphic
displays, where historical context is readily apparent. If the dashboard metric
changes, it should be clear whether the change is statistically significant. As
discussed in the preceding section, a statistical control chart provides the neces-
sary context for this analysis.
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From these business- evel metrics, drill- down capability to subsets of the
data or to the operations or process levels of the organization provides further
understanding of the key drivers influencing trends.
In a Six Sigma deployment, dashboard metrics should be defined for each of
the three main stakeholder groups: customers, employees, and shareholders.
Each of the indices is measured using representative data for a current time
period. As in an automobile, too many dashboard indicators will cause confu-
sion and lack of focus in the short term and accidents or fatalities in the longer
term. At the business level, no more than three or four metrics for each stake-
holder type should suffice.
Once these metrics are defined, their performance should be tracked over
time and shared within the organization. The operational drivers for these
business- level metrics should be defined and monitored at the lower levels of
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the organization and linked effectively to the higher- evel management metrics.
These drivers are discovered as a result of DMAIC projects aligned with the
higher- level metrics. For example, if revenue from existing customers is closely
linked with on- time delivery, customer- service response time, and initial defect
rate, then these metrics should be monitored closely at the operational level,
with regular feedback provided to operating units. Six Sigma projects should
be sponsored to improve performance relative to these metrics.