International Journal of Research in Advent Technology, Vol.2, No.
2, February 2014
E-ISSN: 2321-9637
An Application of Six Sigma in Service Sector-A Case
Study
Aditya R. Wankhade1, Sunil S. Girde2, Pankaj N. Bandabuche3,
Mechanical Engg.Department ACE, Wardha1, 2 Mechanical Engg.Department, GHRCET, Amravati 3,
Asst.Professor1, 2, 3
[email protected]Abstract- Industrial, manufacturing and service organizations are interested in improving their products and
processes by decreasing the variation, because the competitive environment leaves little room for error.
Variation is the enemy of quality which is defined and evaluated by the customers. We must deliver products
and services at the ideal targets demanded by the customers.[2]
The traditional evaluation of quality is based on average measures of the process/product and their deviation
from the target value. However, customers judge the quality of process/product not only based on the average,
but also by the variance in each transaction with the process or use of the product. Customers want consistent,
reliable and predictable processes that deliver or exceed the best-in-class level of quality. This is what the Six
Sigma process strives to achieve . Over the last twenty years, Six Sigma has been successfully implemented in
many industries, from large manufacturing to small businesses, from financial services, insurance industry to
healthcare systems.[3] This paper deals with the implementation of six sigma methodology in service sector.
IndexTerms- What is six sigma?1, Implementation2, Level 3, Case study4.
1. WHAT IS SIX SIGMA? just applies to every function in the company, not
just the factory floor. Six Sigma is a statistical
Sigma (σ) is a letter in the Greek alphabet measurement, which helps us established our
that has become the statistical symbol and metric of course and gauge our pace in the race for total
process variation. The sigma scale of measure is customer satisfaction. It allows us to draw
perfectly correlated to such characteristics as comparison with other similar or dissimilar
defects-per-unit, parts-per-million defectives, and product, services and processes. It is business
the probability of a failure. Six is the number of strategy which makes the customer more satisfied.
sigma measured in a process, when the variation It can greatly help us to gain competitive edge.[6]
around the target is such that only 3.4 outputs out Six Sigma is a disciplined quality improvement
of one million are defects under the assumption methodology that focuses on moving every process
that the process average may drift over the long that touches the customers-every product and
term by as much as 1.5 standard deviations. Six service-towards near perfect quality. It is a measure
Sigma is a quality improvement programmed with of the company’s quality. Six Sigma is more than a
a goal to reduce the number of defects to as low as quantitative statistical measure of processes. Six
3.4 parts per million. It relies on the use of normal Sigma is more than a quantitative statistical
distribution to predict defective rates. Six Sigma measure of processes; it embraces every aspect of
qualities is a benchmark of excellence for product work, using a disciplined, fact based approach to
and process quality, popularized by Motorola based problem solving. It is a new way of thinking about
on zero defect concept introduced by Philip B work and customer value. It is also powerful force
.Crosby. It provides a quantitative statistical notion to create one corporate culture; some of it is
of quality useful in understanding, measuring and bureaucracy busting-pushing down decision-
reducing variation.[5] making to lowest practical levels, empowering
A product is said to be of Six Sigma employees. At the other end i.e. more complicated
quality if there are no more than 3.4 non- challenges-including lean manufacturing initiatives
conformities per million opportunities at the part and variability reduction.[8]
and process step level. Six Sigma is an overall .
strategy to accelerate improvement in its processes, 2. HOW IS SIX SIGMA IMLEMENTED
products and services. It is also a measurement of
total quality to let the company know how effective A typical process for Six Sigma process
it is in eliminating defects and variations from its improvement has five phases: Define, Measure,
processes. It encompasses tools from all Analyze, Improve, and Control, denoted by
improvement initiatives, including those in DMAIC. The DMAIC methodology is central to
operational, technical and customer excellence. It
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International Journal of Research in Advent Technology, Vol.2, No.2, February 2014
E-ISSN: 2321-9637
Six Sigma process improvement projects. The
following phases provide a problem solving
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International Journal of Research in Advent Technology, Vol.2, No.2, February 2014
E-ISSN: 2321-9637
process in which specific tools are employed to turn a • Analyze measurement system capability and
practical problem into a statistical problem, generate establish process capability base line.
a statistical solution and then convert that back into a • Identify where errors in measurements can
practical solution. occur.
• Start measuring the inputs, processes and
outputs and collecting the data.
• Validate that the problem exist based on the
measurements.
• Refine the problem or objective (from the
analysis phase).[6]
2.3Analyze (A):
In the analyze phase the measurements
collected in the measure phase are analyzed so that
hypotheses about the root causes of variations in the
measurements can be generated and the hypotheses
subsequently validated. It is at this stage that practical
Figure: 1 DMAIC Cycle business problems are turned into statistical problems
and analyzed as statistical problems. This includes:
2.1Define (D):
The purpose of the define phase is to clearly identify • Generate hypotheses about possible root
the problem, the requirements of the project and the causes of variation and potential critical
objectives of the project. The objectives of the project inputs (X’s)
should focus on critical issues which are aligned with • Identify the vital few root causes and critical
the company’s business strategy and the customer’s inputs that have the most Significant
requirements. The Define phase includes: define impact and
customer requirements as they relate to this project. • Validate these hypotheses by performing
Explicit customer requirements are called Critical – multivariate analysis.[8]
To- Quality (CTQ)characteristics ;develop defect
definitions as precisely as possible; perform a base 2.4 Improve (I):
line study (a general measure of the level of The improve phase focuses on developing ideas to
performance before the improvement project remove root causes of variation, testing and
commences); create a team character and champion ; standardizing those solution. This involves
estimate the financial impact of the problem ; and
• Identify ways to remove causes of variation.
obtain senior management approval of the
• Verify critical inputs.
project.[10]
• Discover relationships between variables.
• Establish operating tolerances which are the
2.2Measure (M): upper and lower specifications limits (The
The purpose of the measure phase is to fully engineering or customer requirement) of a
understand the current performance by identifying process for judging acceptability of a
how to best measure current performance and to start particular characteristic, and if strictly
measuring it . The measurements used should be followed will result in defect-free products
useful and relevant to identifying and measuring the or services.
source of variation. This phase includes: • Optimize critical inputs or reconfigure the
• Identify the specific performance relevant process.[12]
requirements of relevant critical- To-
Quality (CTQ) characteristics ; 2.5Control(C):
• Map relevant process with identified input The control phase aims to establish standard
and output so that at each process steps, the measures to maintain performance and to
relevant outputs and all the potential inputs correct problems as needed, including
(X) that might impact each output are problems with the measurement system.
connected to each other . This includes:
• Generate list of potential measurements. • Validate measurement systems.
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International Journal of Research in Advent Technology, Vol.2, No.2, February 2014
E-ISSN: 2321-9637
• Verify process long – term
capability. 3.5Champion (S)
• Implement process control with Selected senior executives and managers familiar
control plan to insure that the with basic and advanced statistical tools , who
same problems don’t reoccur by allocate resources and remove barriers for Six Sigma
continuously monitoring the projects ;create the vision of Six Sigma for the
process that creates the products company, develop training plan ,select high impact
or services.[9] projects , select potential people , construct and
improve deployment mechanism , monitor SS project
3. THE MAJOR LEVEL OF THE BELTS AND review , recognize people for their efforts and
COLORS: contribution.[12]
3.1 Six Sigma Green Belt 4.A CASE STUDY
Here the six sigma green belts operators are given
training to operate in the support or under the 4.1 Define:
supervision of a six sigma black belt. Trough this 4.1.1Background and Reason for selecting the
certification the person is trained to analyze and solve case:
quality problems..[12] Sales and service is the key to retain in the market,
increasing the business and profitability. IDEA is one
3.2 Six Sigma Black belt of the top company in a telecom sector, having large
The candidates who had undergone six sigma black no. Customer. But it was found that the sales of SIM
belt certification is a professional who is capable in and Recharge are decreased Due to which Agency is
the explanation of six sigma philosophies and the not able to achieve the target given by company. If it
principles. His knowledge also includes the is achieve then agency will get commission of 0.5%
supporting systems and the tools. This certification per month on recharge.
also deals with the training of the candidates in
developing the demonstration of the team leadership, 4.1.2Project Charter:
understanding team dynamics and assigning team Department: IDEA Telecom Service
members roles and responsibilities. [12] Project Title: To increased the sale of IDEA’s SIM
and Recharge by improving service
3.3Master Black Belt Goal statement: To achieve the target by increasing
The professional who had undergone the master sales.
black belt certification are considered as a six sigma Business case: This case study will support to
quality experts and they are responsible for the achieve the target with respect to sales and to track
strategic implementations within an organization. down the root causes for failure.
The training is given for the improvement of the Customer’s CTQ: Good Service
responsibilities of a master black belt, which includes Scope: It will increased the sales
training and mentoring of black belts and the green Opportunity Statement: 1. Improvement in service
belts. t.[12] 2. Increase sales
Direct Benefits: Customer satisfaction, Source of the
3.4Yellow Belt project: Information gathered and Data collected
Six Sigma Yellow Belt certification provides with from Agency. Project Team and Plan.
the attendees an overall insight to the use age of the
six sigma techniques. The training is also given in the Table 1 Project plan
field of six sigma metrics and the basic improvement
methodologies. The certification helps the trainees to
receive an idea about the introduction to the process
management and the basic tools of six sigma . Strong
understanding of the processes, enabling each
individual to provide meaningful assistance is the
other characteristics of the six sigma yellow belt
certification. The aim of this certification is the
achievement of the organizations overall
objectives.[12]
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International Journal of Research in Advent Technology, Vol.2, No.2, February 2014
E-ISSN: 2321-9637
4.1.3Process Flow Diagarm:
Process flow diagram prepared to understand the
sales of SIM and recharges.
ZONAL DEALER RETAILE
OFFICE R
Fig.2 Process flow diagram
CUSTOMER Fig.3 Bar-chart of sales of SIM Vs Month
4.1.4 Sipoc Digarm::
SIPOC prepared to know about the process, input,
output and customer which is shown in table2.
Table 2. SIPOC table
Supp Input Proce output customer
lier ss
Zonal Sim and Sales Profit Dealer
office Recharge
Deale Sim and Sales Target Retailer/us Fig.4 Bar-chart of sales Recharges Vs Month
r Recharge achievement, ers 4.2.1Current Performance:
Profit,commis Annual turnover- more than 1.9 cr. Appr.
ion
Profit margin- 1.3% on Recharge
Retail Sim and Sales Profit customers
er Recharge Profit on sim- 50 Rs./sim
Sales of SIM- 300-400 appr.
sales of Recharge- 16 lack./ month Appr.
4.2Measure: Target of SIM- 600/month
In this phase data for monthly sale of SIM and Target of recharge- 17 lac./month Appr.
recharges since last seven month have been collected If target achieved agency will get commission of
.plan for data collection decided by team according to 0.5% on sales of recharge.
plan data have collected and Bar chart is used to profit /month may increased upto 8500p.m.
represent the data collected. Sigma Level (FOR SIM):
Table 3.Data Collection Plan In this sigma level have been calculated and shown in
SR.NO MONTH SALES SALES OF table 4.
OF SIM RECHARGE( 4.2.2sigma level table for SIM:
IN LAC.)
Table.4 sigma level table for SIM
1 MAY 390 16
Sr. No. Month Target Sales DPMO ( Sigma level
of SIM in ppm)
2 JUNE 310 16.30
1 May 600 390 350000 1.9
2 June 600 310 500000 1.5
3 JULY 330 15.50
3 July 600 330 450000 1.6
4 AUG 320 15.70 4 Aug 600 320 466666 1.6
5 Sep 600 300 500000 1.5
5 SEPT 300 15.60
6 Oct 600 340 433333 1.7
6 OCT 340 15.80 7 Nov 600 310 500000 1.5
7 NOV 310 15.70 4.2.3Sigma Level (FOR RECHARGE):
In this sigma level have been calculated in monthly
and shown in table 4.
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International Journal of Research in Advent Technology, Vol.2, No.2, February 2014
E-ISSN: 2321-9637
Table.5 sigma level table for Recharges 4.3.3Cause and effect diagram:
Sr. Month Target( Salesof DPMO Sigma level
No. in lac.) recharge(L (in ppm)
ac)
1 May 17 16 4142 4.1
2 June 17 16.30 2900 4.3
3 July 17 15.50 6214 4
4 Aug 17 15.70 5385 4
5 Sep 17 15.60 5800 4
Fig.6 cause and effect diagram
6 Oct 17 15.80 4971 4.1
4.3.4 Failure mode and effect analysis (FMEA):
7 Nov 17 15.70 5385 4 Table.6 FMEA analysis
POTENTIAL POTENTIAL S POTENTIAL CAUSES
FAILURE EFFECTS E
MODE V
4.3Analyze:
In this phase various tool like voice of customer,
pareto chart, cause and effect diagram have used to DECREASED DISSATISFIED 10 POOR NETWORK
find out the causes. SALES AND CUSTOMER 3 G NETWORK NOT
SERVICE OF AVAILABLE
4.3.1Voice of Customer: IDEA’S SIM UNAVAILABILITY OF
We have conducted survey to the retailer and AND RECHARGE
customers to find out what customer require as most RECHARGE UNABLE TO SOLVE
important to take care of and the response was as CUSTOMER
COMPLAINTS
under: AUTOMATIC BALANCE
Ranking has been done as per customer’s DEDUCTION
priority: LONG ACTIVATION
Poor network PROCESS
high speed internet BRAND 8 POOR COMMUNICATION
Recharge should be available REPUTATION WITH CUSTOMER
Complaints should solve quickly at dealer AFFECTED DECREASE SALES
Fast sim activation within one day
Good schemes on sim and recharge
GROWTH OF 8 POOR SERVICE FROM
OTHERS IDEA
4.3.2Pareto chart: BRAND
Pareto chart On the Basis of Brainstorming of 100
Customer Who has Change Ser. Provider Using MNP
facility. Pareto chart used to find the causes which 4.3.5Result of analysis:
have more impact on problem shown in fig.5 On the basis of cause and effect diagram, FMEA,
Pareto chart and VOC. Root causes are identified and
recommendation are given which is implemented at
experimental level.
4.4Improve:
In the pilot Implementation it was decided by the
agency to implement the recommendation on
Experiment level for 1 month. Dec.12.
Fig.5. pareto chart of Customer Vs Causes Result of pilot implementation:
sale of SIM in Dec.– 570
sales of recharge- 16.70 lac.
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International Journal of Research in Advent Technology, Vol.2, No.2, February 2014
E-ISSN: 2321-9637
4.5Control: VNSGU journal of management and
It was found in pilot study that the sales of SIM Administration, ed. 2. Vol.2.
and recharge both increases, therefore it was [3] Desai, Tushar & Shrivastava, Dr. R. L.
decided by the agency to continued work with (2008) ‘ Six Sigma A New Direction to
the given recommendation. quality and Productivity Management’ ,
World Conference On Engineering And
4.5.1Result: Computer Science, San Francisco, USA.
After full implementation result are achieved so far [4] Antony, Jiju (2004) ‘Six Sigma In The
i.e.- sales of sim in jan13- 598 sales of recharge- UK Service Organizations: Result From
16.99 lac. Sigma level have been compared before Pilot Survey’, Managerial Auditing Journal.
and after DMAIC which shown in table 5.8. In the ed.8.Vol.19, Emerald Group Publishing Ltd.
table it clearly shows that the sigma level of both
SIM and recharges of last two month have improved.
[5] Rhodes Jo, Lok Peter, Abe Diamond
And Nitin. ‘The Six Sigma Approach in
Table.9 comparison of Sigma level
Performance Management To Reduce Injury
Sr, Month Sales Sigm Sales of Sigm Rate At Work’, Institute Of Transport And
No of SIM a Recharg a Logistic.
Level e Level [6] Zhan Qun , Muhammad Irfan And
1 May12 390 1.9 16 4.1
Aamir Muhammad.(2012) ‘Six sigma: a
2 June12 310 1.5 16.30 4.3
Literature Review’, Interdisciplinary Journal
3 July12 330 1.6 15.50 4 of Contemporary Research in Business,
4 Aug12 320 1.6 15.70 4 ed.10, Vol.3,
5 Sep12 300 1.5 15.60 4 [7] Desai, Tushar & Shrivastava, Dr. R. L.
6 Oct12 340 1.7 15.80 4.1 (2012) ‘An effective application of six
7 Nov12 310 1.5 15.70 4 sigma design of experiment in process
8 DEC 12 570 3.2 16.70 4.6 industry’, Industrial Engineering
9 JAN 13 598 4.2 16.99 5.5 Journal,Vol.2,
CONCLUSION [8] Desai, Tushar & Shrivastava, Dr. R. L.
In this we have successfully implemented DMAIC (2010) ‘The Origin, History and Definition
methodology in service sector and improved sigma of Six Sigma: A Literature Review’,
level. This article attempts to summarize the VNSGU journal of management and
literature on six sigma application in services. It Administration, ed. 2. Vol.2.
shows that there is a limitation in the spread of six [9] Desai, Tushar & Shrivastava, Dr. R. L.
sigma in services. (2008) ‘ Six Sigma A New Direction to
quality and Productivity Management’ ,
World Conference On Engineering And
FUTURE SCOPE
Computer Science, San Francisco, USA.
The sigma level achieved after implementation of [10] Antony, Jiju (2004) ‘Six Sigma In The
DMAIC six sigma methodology can further UK Service Organizations: Result From
improved & new performance standards can be Pilot Survey’, Managerial Auditing Journal.
realized. Six sigma methodologies expect that the ed.8.Vol.19, Emerald Group Publishing Ltd.
new learning will be validated & evaluated with [11] Rhodes Jo, Lok Peter, Abe Diamond
practice. \ And Nitin. ‘The Six Sigma Approach in
REFERENCES Performance Management To Reduce Injury
[1] Desai, Tushar & Shrivastava, Dr. R. L. Rate At Work’, Institute Of Transport And
(2012) ‘An effective application of six Logistic.
sigma design of experiment in process [12] Zhan Qun , Muhammad Irfan And
industry’, Industrial Engineering Aamir Muhammad.(2012) ‘Six sigma: a
Journal,Vol.2, Literature Review’, Interdisciplinary Journal
[2] Desai, Tushar & Shrivastava, Dr. R. L. of Contemporary Research in Business,
(2010) ‘The Origin, History and Definition ed.10, Vol.3,
of Six Sigma: A Literature Review’,
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International Journal of Research in Advent Technology, Vol.2, No.2, February 2014
E-ISSN: 2321-9637
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International Journal of Research in Advent Technology, Vol.2, No.2, February 2014
E-ISSN: 2321-9637
