Stamford University Bangladesh

Siddeswari, Dhaka

Homework-Chapter 7 A & B

Course title: Strategic Management.

Course code: - MGT-604.

Submitted to

Mohammad Jaynal Abedin

(Associate Professor, Department of Business Administration)
(Stamford University Bangladesh)

Submitted by

Student Name: - Sudipta Deb Nath

ID: - (MBA-072 18422)

Date of submitted: - 08.04.2021.

How Six Sigma Began
In the 19th century, German mathematician and physicist Carl Fredrich Gauss developed the bell curve. By
creating the concept of what a normal distribution looks like, the bell
curve became an early tool for finding errors and defects in a process

In the 1920s, American physicist, engineer and statistician Walter

Shewhart expanded on this idea and demonstrated that “sigma imply
where a process needs improvement,” according to “The Complete
Business Process Handbook: Body of Knowledge From Process
Modeling to BPM Vol. 1” by Mark von Rosing, August-Wilhelm Scheer
and Henrik von Scheel.

In the 1980s, Motorola brought Six Sigma into the mainstream by using the methodology to create more
consistent quality in the company’s products, according to “Six Sigma” by Mikel Harry and Richard Schroeder.

Motorola engineer Bill Smith eventually became one of the pioneers of modern Six Sigma, creating many of the
methodologies still associated with Six Sigma in the late 1980s. The system is influenced by, but different than,
other management improvement strategies of the time, including Total Quality Management and Zero Defects.

Does it work? Motorola reported in 2006 that the company had saved $17 billion using Six Sigma.

What is Six Sigma:

Six Sigma is a method that provides organizations tools to improve the capability of their business processes.
This increase in performance and decrease in process variation helps lead to defect reduction and improvement
in profits, employee morale, and quality of products or services.

The Six Sigma methodology calls for bringing operations to a “six sigma” level, which essentially means 3.4
defects for every one million opportunities. The goal is to use continuous process improvement and refine
processes until they produce stable and predictable results.

Six Sigma is a data-driven methodology that provides tools and techniques to define and evaluate each step of a
process. It provides methods to improve efficiencies in a business structure, improve the quality of the process
and increase the bottom-line profit.

Importance step of Six Sigma:

Methodology of Six Sigma:
There are two major methodologies used within Six Sigma, both of which are composed of five
sections, according to the 2005 book “JURAN Institute Six Sigma Breakthrough and Beyond” by Joseph
A. De Feo and William Barnard.

DMAIC: The DMAIC method is used primarily for improving existing business processes. The letters
stand for:

• Define the problem and the project goals

• Measure in detail the various aspects of the current process
• Analyze data to, among other things, find the root defects in a process
• Improve the process
• Control how the process is done in the future

DMADV: The DMADV method is typically used to create new processes and new products or services.
The letters stand for:

• Define the project goals

• Measure critical components of the process and the product capabilities
• Analyze the data and develop various designs for the process, eventually picking the best one
• Design and test details of the process
• Verify the design by running simulations and a pilot program, and then handing over the
process to the client

Benefits of Six Sigma:

Implementing Six Sigma within a business offers several benefits. However, there are six key advantages that
this methodology will offer any company.

1: Improved Customer Loyalty

Any business wants to retain its customers. Indeed, this is a significant factor in determining the success of a
firm. But, of course, customer loyalty and retention only ever come because of high levels of customer
satisfaction.

Surveys suggest the reasons given by most customers for not returning to a business are dissatisfaction with the
experience and employee attitude. Often a company will not even know they have a dissatisfied customer as
they will simply take their businesses elsewhere.

Implementing Six Sigma reduces the risk of your company having dissatisfied customers, for once training is
complete, so few experiences should be outside of their specifications. To achieve this, we may want to consider
running a voice of the customer study which helps your business understand which of our products attributes are
critical to the customer's perception of satisfaction.

2: Time Management
Employing a Six Sigma methodology at our business can help employees manage their time effectively, resulting
in a more an efficient business and more productive employees. Users are asked to set SMART goals and then
apply the data principles of Six Sigma to those goals. This is done by looking at three key areas: learning,
performance, and fulfilment.
For instance, under learning, a practitioner of Six Sigma might ask themselves; how often do interruptions take
me away from my task and how many of these interruptions require my attention?

Similarly, under performance, they might consider how their practices are helping them reach their professional
goals. Users can then create an action plan, the result of which can be employees who are up to 30 per cent more
efficient and who are happier in themselves, having achieved a better work-life balance.

3: Reduced Cycle Time

Unfortunately, most projects firms embark on end up extending beyond their original deadline often because
there are changes in project scope or there is a shift in management policy.

By using Six Sigma, a business can set up a team of experienced employees from all levels within the
organization and from every functional department. This team are then given the task of identifying factors that
could negatively affect the project leading to long cycle times.

They can then be tasked to find solutions to these potential problems. This method allows business to create
shorter cycle times for projects and stick to those schedules, with many firms reporting reductions in cycle times
of up to 35 per cent.

4: Employee Motivation
Every business, if destined to succeed, needs its employees to act in the right way - but for employees to do so
there must be sufficient motivation. Indeed, organizations who are willing to fully engage with employees have
consistently demonstrated 25 - 50 per cent increases in productivity.

Sharing Six Sigma problem solving tools and techniques will allow for employee development and help create
a climate and systems for employee motivation.

5: Strategic Planning
Six Sigma can play an integral part in any strategic vision. Once your business has used a created a mission
statement and carried out a SWOT analysis, then Six Sigma can help us focus on areas for improvement.

For instance, if your business strategy is based on being a cost leader in the market, then Six Sigma can be used
to improve internal processes, increase yields, eliminate unnecessary complexity, and gain or maintain lowest
cost supplier agreements. In fact, whatever your strategy happens to be, Six Sigma can help make your company
the best at what it does.

6: Supply Chain Management

One of the possible ways to reduce the risk of defect is to use Six Sigma to drive down the number of suppliers
your businesses has, as this in turn reduces the risk of defects.

It's also important to understand if your supplier is planning to implement any changes. For instance, a change
in machinery can have an effect like the ripples from a rock thrown into a pond. The most successful firms drive
their Six Sigma improvements as far up the supply chain as possible.