Friday, December 14, 2007

Six Sigma achieves extraordinary ROI

“Making the Business Case for Six Sigma Deployment”


You may have read about and seen the benefits of Six Sigma but are unsure how to approach your senior leadership about the opportunity because they do not have a concise package of information to convey.

Here is a series of tried and tested steps to gain management buy-in on the benefits of Six Sigma.

The Importance of Leadership Buy-in

Without leadership buy-in, there is little hope for Six Sigma adoption. A company's executives must believe and support Six Sigma's potential with dollars, words and actions just like any other corporate objective or goal. Executives are looking for a return on investment (ROI), risk mitigation and competitive advantage. Therefore, to convince them of the value Six Sigma will bring to the organization, it is important to present the benefits as a business case. Follow these 8 steps to deploy an effective Six Sigma programme.

The major steps to developing and presenting the business case are:

1. Identify and evaluate your audience.
2. Research and summarize successful launches at other organizations
with similar functions; include the ROI and a sample project.
3. Document critical success factors.
4. Define deployment requirements.
5. Define a pilot project.
6. Calculate and display the potential financial savings range and ROI
including "soft" elements such as corporate image and competitive advantage.
7. Present and sell Six Sigma to the executives.
8. Get ready for deployment!

Defining Six Sigma ...
Six Sigma is a strategic, top management driven transformation of an organization that focuses on profitably fulfilling customer needs using highly trained employees who use data in a disciplined and methodical scientific approach to continuous improvements in competitiveness, processes, and products through effective resource alignment.

The essential components of Six Sigma:
* Is driven by top management.
* Focuses on profitable customer fulfillment.
* Requires everyone to be highly trained.
* Is data driven, not based on beliefs or conjecture.
* Requires disciplined and methodical (i.e., scientific) problem solving approaches.
* Fosters continuous process and product improvement through resource alignment.

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