This is a general question asked especially when Six Sigma approach is used for Improvement is what is supposed to be my improvement goal for Six Sigma Project. In cases where the project is taken up for Problem Solving, the goal setting is straight forward. In this case the goal is to solve the problem. (or Meet the Requirements)
However, it is very tough in case of Improvement Projects. Various methods are available for setting the goal. However, there is some pre work to be done in this case.
1. Collect all the metrics which are generated from the process you want to improve, (Example – Delivery rate, Quality, Defects, Customer Satisfaction, Effort ……)
2. Prioritize and identify the Primary Metric. Primary could be anything where you can improve upon. (Start with what is important to customer)
3. Baseline the Primary Metric and its relation with the secondary metrics. (This is needed to know what will happen when your primary metric moves and optimize the goal setting.)
Now the billion dollar question ” How much we should set the target” “How much we can Improve” ” How much improvement we Need”.
There are no standard set of rules for setting improvement goals. However, below are few guidelines.
- As a minimum, the goal shall be set in such a way that the difference between the current performance and the goal is statistically significant.
- The goal must be in line with the business expectations and the improvement shall be a breakthrough one instead of incremental one. a 5% improvement is incremental but 50% improvement is Breakthrough
- The goal shall take you towards the benchmark for the same process performance. Ideally the benchmark need to be considered is the industry best practice.
- The goal need to cover the gap between the entitlement and the current performance by atleast 70%. Entitlement is the performance which is expected for the investments already made or the best capability of the process internally.
Remember the goal should be in line with the organizational capability to achieve. A little stretch is OK but shall not be such that it is un achievable.
The Six Sigma Black-belt shall ensure that the goal of the project is acceptable to the Team and the Management. Agreement of all stakeholders is must to achieve the intended goals.