Six Sigma and KPI’s: Return on Innovation Investment

 

 

course, most professionals are familiar with Return on Investment. Yet, another more insightful key performance indicator is your Return on Innovation Investment (ROII). Most companies and organizations invest a percentage each year into innovations. However, what is your return on these investments? In this article, we will analyze ROII, what it is, and why every Six Sigma professional should be using it.

What is Return on Innovation Investment?

 Return on Innovation Investment is a calculation that assesses how much revenue certain innovations make for an organization. On average, companies will invest 3.5% of their revenue into innovations each year. These categories include research and development, along with innovation activities. More specific industries, such as manufacturing and high-tech will invest greater percentages. Because organizations invest in these innovations, it’s important to measure how effective they are at generating revenue. That’s where ROII comes into play. This calculation provides insight into your innovation activities while comparing it with returns from other investments.

How to Calculate your ROII

 While there are multiple ways to calculate your ROII, the most effective way is in retrospect. First, you calculate the difference between your net profits from new products/services and their respective innovation costs. With this figure, you then divide by the respective innovation costs. You can calculate your ROII for future estimations. However, this requires more time and resources and may not be highly accurate.

 

While calculating your ROII is important, how often you do can be more so. Most organizations will calculate their ROII every quarter, at the end of an innovation project, or after a year. When and how often you make this calculation can greatly affect your rate of return. However, when you do calculate your ROII, you will have a percentage of your return. This directly correlates to how long it will take to regain. For example, an ROII of 25% each year will require four years to payback for your investment.

 

Another key factor in calculating an accurate ROII is where you source your data. It’s important to extract the correct data from the innovative investments you want to assess. Typically, you can use accounting and project data that team members will organize.

Why You Should Calculate your ROII

 While your organization may invest heavily into various departments, it’s important to understand your innovation investments first hand. First, innovations can either make or break efficiencies within your company. Because the Six Sigma philosophy focuses on improving efficiencies, you must calculate where these are being made. Likewise, your ROII is an ideal way to reflect on past projects and see where improvements can be made in the future. Although ROII can be used for future estimations, we do not advise this because of its high cost and inaccuracy. Furthermore, your return on innovation investment can help decide if your organization needs to devote more or less funding to it each year. If you see a negative trend for most innovations, you may not need as much funding as once predicted.

Making the Most of Quality Data

 

Plant-floor quality issues tend to focus on a company’s technical resources. When products fall out of spec, alarms sound and all hands are immediately on deck to fix things. Despite large technology investments to monitor and adjust production processes, manufacturers are still bedeviled by quality problems. The issue is not a lack of technology. It is a lack of quality intelligence.

When problems occur, manufacturers must obviously fix them. But the typical organization expends much more energy reacting to problems rather than preventing them. This is true despite our understanding that, “an ounce of prevention is worth a pound of cure.” We know that proactive measures can be immensely profitable, and yet our limited quality resources spend little time identifying strategic imperatives for avoiding problems. Instead, most of their time is spent responding to issues. Today’s quality professionals are too preoccupied with just fighting the fires that rage on shop floors.

Quality and the big picture

The most successful, forward-looking and competitive companies I work with focus on proactively preventing problems. How? By taking a holistic view of quality. They regularly step back to summarize and analyze large amounts of quality data. Stepping back gets them away from the fires, and out of the routine of fixing issues.

Imagine aggregating all of your quality data for the last month across all products and production lines. Doing so would allow you to see the nuanced quality differences between regions and plants. It would tell you where systemic issues need to be addressed and help prioritize improvement efforts. In other words, aggregating data allows you to see the big quality picture.

Today’s manufacturing plants make a dizzying variety of products. So you may be wondering how wholesale information can be extracted from vastly different parts, material types, and specification limits. To summarize information across different parts, data normalization can be used to allow fair comparisons even between disparate items. Today it is just a mathematical exercise; easy to perform with software, making data unification and summarization a reality.

Stop “storing and ignoring”

When critical features fall out-of-spec, alarms blare and support personnel descend on the shop floor and get the issues fixed. After completing their tasks, they quickly move on to the next daily priority or fire drill. In this case, at least the alarm data were used for solving the problem.

But what happens to data that triggers no alarms? What about data that meets specification limits? Most will say that if data is in-spec, then it is good enough. And that is the problem. When data is considered “good enough” it is just stored in a database, rarely to be seen again. The error here is assuming that since the data didn’t trigger an alarm, it contains no useful information. If data is not reviewed or analyzed, then expect to be blind to the information it contains. The truth is that value exists in any data you collect. Otherwise, it shouldn’t be collected.

When companies ignore in-spec data, they are throwing away enormously useful information. Many companies I have worked with have turned orphaned data into gold by extracting previously unknown information from it. It was unknown simply because they considered the data to be “good enough.” As a result, they were blind to the information the data contained. These experiences have me conclude that the greatest potential for modern quality improvement comes from aggregating and analyzing data that actually falls within specifications.

Seem odd? Not to me. Think of how frequently parts don’t meet specs. It’s rare. That means that very few data values are viewed for problem-solving purposes. And if those few data values receive the lion’s share of attention, what happens to the huge amount of data where no problems exist? They are stored and ignored.

And it’s getting worse. Because modern technologies support automated data collection, far more data is currently being gathered than in years past. This means that the amount of data being ignored is increasing. It’s staggering how much data is available and yet how little of it is ever viewed.

The reality is that companies rarely go back and look at data that is in spec. Yet, there is rich, valuable information hidden in those overlooked records. Imagine being an operations director who oversees 50 plants. If you could roll up all of your critical quality data across those locations, you would immediately have a holistic view of your manufacturing operations. You could identify which regions are the best performers. You could highlight the plants and production lines with the highest quality costs. You could pinpoint where defect levels could be reduced and which plants require attention to minimize the probability of recalls. And your company could become more competitive as a result.

Rather than simply reacting to quality problems, manufacturers need to direct their attention and time to proactively attacking quality. How? By regularly evaluating the massive amount of overlooked data that they already have.

Data aggregation through cloud technology

Traditional on-premises software solutions aren’t great for deploying across an enterprise. But cloud-based quality software platforms are. Since cloud-based solutions are securely hosted by vendors who monitor and maintain system infrastructure, the need for on-site IT support is minimized and capital costs are greatly reduced. The nature of cloud-based systems makes large-scale, multi-plant deployments fast, easy, and inexpensive, ensuring benefits are enjoyed sooner rather than later.

Plus, cloud-based systems connect manufacturing sites across the internet, support standardization, and store quality data from multiple plants in a centralized database. Because data is stored in one place, quality professionals, engineers, managers, and others can easily view the big picture of quality. A single data repository is ideal for supporting corporatewide quality strategies and initiatives.

Cloud-based quality systems should use simple web browsers, empowering quality professionals to break through geographical, cultural, and infrastructural barriers to connect facilities around the world—and provide data aggregation capabilities that can unlock critical information for driving quality improvements on a large scale.

The capability is here and the technology is inexpensive. So what keeps quality professionals from enjoying enterprisewide cost and defect reduction? It’s those fires you keep fighting every day. Don’t just snuff them out—prevent them in the first place and use the time savings to re-imagine how quality can transform your organization’s performance.

PMO Opeartion – Asst Manager- Hyderabad

The setup has various groups which provide effective solutions to the customers by following a streamlined system development methodology and comprises of groups like Usability, Application Architecture, Development and Quality Assurance and Performance.

Education and Qualifications

• Prince2 Practitioner or PMP

• Advanced level use of Excel and SQL Reporting 

• Intermediate level use of Visual Basic and SSRS Reporting

• Intermediate level use of MS Project, PowerPoint, Visio, Word and SharePoint

Years of Experience: 7+ years

Key Competencies

• Excellent attention to detail; fast accurate work

• Excellent administration skills

• Excellent interpersonal, communication and presentation skills

• Excellent relationship management skills

• Strong team player

• Ability to be proactive and work alone as well as part of a larger team

• Must be very well organised and be able to respond to changing priorities

• Knowledge of project delivery processes

• Analytical and flexible

• Ability to synthesise and visualise complex data

• Technically minded

How you’ll grow

At Deloitte, we’ve invested a great deal to create a rich environment in which our professionals can grow. We want all our people to develop in their own way, playing to their own strengths as they hone their leadership skills. And, as a part of our efforts, we provide our professionals with a variety of learning and networking opportunities—including exposure to leaders, sponsors, coaches, and challenging assignments—to help accelerate their careers along the way. No two people learn in exactly the same way. So, we provide a range of resources including live classrooms, team-based learning, and eLearning. DU: The Leadership Center in India, our state-of-the-art, world-class learning Center in the Hyderabad offices is an extension of the Deloitte University (DU) in Westlake, Texas, and represents a tangible symbol of our commitment to our people’s growth and development. Explore DU: The Leadership Center in India

Benefits

At Deloitte, we know that great people make a great organization. We value our people and offer employees a broad range of benefits. Learn more about what working at Deloitte can mean for you. 

Deloitte’s culture

Our positive and supportive culture encourages our people to do their best work every day. We celebrate individuals by recognizing their uniqueness and offering them the flexibility to make daily choices that can help them to be healthy, centered, confident, and aware. We offer well-being programs and are continuously looking for new ways to maintain a culture that is inclusive, invites authenticity, leverages our diversity, and where our people excel and lead healthy, happy lives.  Learn more about Life at Deloitte.

Corporate citizenship

Deloitte is led by a purpose: to make an impact that matters. This purpose defines who we are and extends to relationships with our clients, our people and our communities.  We believe that business has the power to inspire and transform. We focus on education, giving, skill-based volunteerism, and leadership to help drive positive social impact in our communities.  Learn more about Deloitte’s impact on the world.

 

“Deloitte” is the brand under which tens of thousands of dedicated professionals in independent firms throughout the world collaborate to provide audit, consulting, financial advisory, risk management and tax services to selected clients. These firms are members of Deloitte Touche Tohmatsu Limited DTTL, a UK private company limited by guarantee. Each member firm provides services in a particular geographic area and is subject to the laws and professional regulations of the particular country or countries in which it operates. DTTL does not itself provide services to clients. DTTL and each DTTL member firm are separate and distinct legal entities, which cannot obligate each other. DTTL and each DTTL member firm are liable only for their own acts or omissions and not those of each other. Each DTTL member firm is structured differently in accordance with national laws, regulations, customary practice, and other factors, and may secure the provision of professional services in its territory through subsidiaries, affiliates and/or other entities.

In the United States, Deloitte LLP is the member firm of DTTL. Like DTTL, Deloitte LLP does not provide services to clients. Instead, services are primarily provided by the subsidiaries of Deloitte LLP, including:

  • Deloitte & Touche LLP
  • Deloitte Consulting LLP
  • Deloitte Financial Advisory Services LLP
  • Deloitte Tax LLP

Project Coordinator -(Night Shift)

 

Purpose of Role:

 

nscglobal’s Project Management function is pivotal in ensuring projects and programmes are delivered on time, right quality within budget to a satisfied client.

 

It is the role of the project coordinator to lead medium sized standard projects, or numbers of smaller standard projects and to take responsibility for the achievement of the agreed goals and objectives. A project coordinator will use established processes. At times they will manage a sub-project as part of a large complex project under the guidance of a Project Manager or Programme Manager.

Responsibilities:

Professional capability in project management is displayed when the leader of the project delivers the results required by all stakeholders. This requires managing the many variables that occur, during the life of the project. The projects that a project coordinator is responsible for are likely to be standard or sub-projects of large complex projects. The following responsibilities show the breadth of issues the project coordinator needs to manage

 

  • Project Integration Management – Achieve customer deadlines. Be responsible for project or sub-project performance. Represent nscglobal to the customer in a in a positive way. Ensure a project plan is prepared and maintained. Use previous experience and follow the nscglobal project management method. Manage the plan using the negotiated resources. Measure performance and take corrective action where necessary. Manage a change management process to provide change control.
  • Project Scope Management – Responsible for delivering the agreed outcomes required from the project or sub-project. Conduct stakeholder analysis, define and manage customer expectations both stated and unstated. Manage the interface between nscglobal and the customer. Liaise with the nscglobal business units for project inputs and regularly report to the sponsor.   Clarify definition of mandate, details of contract and manage contract variations.
  • Manage the relationship with internal and where applicable external customers to monitor and manage any changes to requirements or expectations. Ensure acceptance of project deliverables by stakeholder/customer/sponsor. The above may be under the guidance of a Project / Programme Manager.
  • Project Time Management – Use a formal process to estimate times for all activities, sequence them and then prepare the schedule. Control performance to meet the deliverables according to the schedule.
  • Project Cost Management – Plan, allocate and manage budgets. Give forewarning of any deviations from budget. Control the budget within the limits of the project specification and the amount released by the project sponsor through the contract. Seek approval from the sponsor for any anticipated expenditure above the project budget.
  • Project Quality Management – Establish quality requirements and manage project to ensure compliance. Ensure all variations are agreed, documented and managed. Ensure a project information base is maintained through an approved project specification, regular reports and minutes, and a final report. Use project reviews as a way of objectively monitoring project performance.
  • Project Human Resources Management – Actively promote team effectiveness, morale and productivity. Ensure the team owns the goals of the project and they are willing to extend themselves to meet the goals. Support competence development of team and of other nscglobal staff.
  • Project Communications Management – Implement a communication strategy to inform all stakeholders, provide regular reports. Provide market information as to future business opportunities to the CSM and/or Account Director.
  • Project Risk Management – Use risk management to minimise cost variations and deviations from schedule while delivering to the stakeholder’s confidence in the project.
  • Project Procurement Management – In management of sub-projects in large complex engagements work within the procurement management processes defined. Manage third party equipment and suppliers. Provide feedback of efficiency of tools and competence to use them available to the project team.

Qualifications:

Essential:

 

  • Project Management – Experienced in the principles, methods and techniques for the effective management of projects. A minimum 2 years’ experience of demonstrated competence in project coordination / administration. 
  • Communication – Proficient written and oral communicator.
  • Analytical – Familiar with facilitating a team to problem solve and resolve issues.
  • Project Management Tools – Familiar with the use of automated tools to assist in the project management process by automating mechanical tasks such as scheduling, resource balancing and time recording, e.g. Microsoft Project.
  • Project Management Methodologies – Have an understanding of the principles of project management.
  • Progress Reporting – Able to apply techniques for reporting the progress of activity against plan.
  • Cross-Functional and Inter-Disciplinary Awareness – Understanding the needs, objectives and constraints of those in other disciplines and functions
  • Strategic Perspective – Keeping overall objectives and strategies in mind, and not being deflected from these when dealing with matters of detail
  • Professional Qualification(s) – A diploma or A’ Levels and PRINCE2® Foundation Certificate, Project Management Institute (PMI) certification or equivalent
  • Project Management – Previous involvement in ICT projects.
  • Product Knowledge – Understanding of IT and networking products.

 

Desirable:

 

  • Project Management Methodology – Familiar with the application of a Project Management methodology.
  • Financial Management – Familiar with financial management.
  • Leadership – Able to motivate others towards the achievement of goals and objectives.
  • Delegation – Delegating tasks and responsibilities effectively
  • Initiative – Being proactive, taking action and anticipating outcomes
  • Stress Handling – Retaining objectivity and proper understanding of a problem or situation when placed under conditions of stress
  • Flexibility – Taking account of new information or changed circumstances and modifying understanding of a problem or situation accordingly
  • Influence and Persuasion – Influencing and persuading others to take a specific course of action when there is no direct line of command or control.
  • Customer Focus – Understanding and keeping the client’s needs continually in mind when taking actions or making decisions.
  • Industry and Professional Standards – Understanding of the standards associated with the role such as nscglobal project management standards.
  • Sales Process – Aware of the sales cycle, previous experience in a vendor organisation beneficial
  • Commercial Awareness – Keeping the organisations business success in mind in carrying out all responsibilities.

Project Manager

Responsability:

  • Coordinate internal resources and third parties/vendors for the flawless execution of projects

  • Ensure that all projects are delivered on-time, within scope and within budget

  • Developing project scopes and objectives, involving all relevant stakeholders and ensuring technical feasibility

  • Ensure resource availability and allocation

  • Develop a detailed project plan to track progress

  • Use appropriate verification techniques to manage changes in project scope, schedule and costs

  • Measure project performance using appropriate systems, tools and techniques

  • Report and escalate to management as needed

  • Manage the relationship with the client and all stakeholders

  • Perform risk management to minimize project risks

  • Establish and maintain relationships with third parties/vendors

  • Create and maintain comprehensive project documentation

Requirements:

  • Education: Higher or technical engineering, in Computer Science, or Telecommunications.

  • Postgraduate studies in Project Management. PRINCE2 or PMP certification.

  • Languages: Person with international profile, fluent English.

  • Previous experience: 3-5 years in Project Management in Software and Hardware solutions.

  • International experience: Europe or America

  • Technical and economic management of the project

  • Customer relationship.

  • Lead the coordination with the people involved in the project.

  • Integration and validation of all modules developed

  • Review of project documentation.

  • Coordination with Technical Management.

  • Coordination with Software Manager.

What we offer:

  • Permanent contract

  • Internacional environment.
  • Territory: India.

Six Sigma and KPI’s: Klout Score

Each day, new companies, organizations, and individuals join the online community of social media. Over the past decade, social media has completely revamped how we conduct business and gain traction. In the past, you would advertise on billboards and in magazines at high costs. Now, you can advertise your organization at nearly no cost and gain more interaction. However, just because you’re now on social media doesn’t mean you will thrive. Each organization is different and there are various ways you can alter your interaction with existing and potential customers. Yet, before you change up your online presence, you must see what traction you do receive. For this, we recommend calculating your personal Klout score.

 

What is a Klout score?

 

By definition, your Klout score is a measurement of your overall online influence ranging from zero to 100. First developed by a young start-up company, this underlining algorithm uses over 35 variables to measure your online presence. By simply downloading the application, you can connect your various social media accounts and it calculates their scores automatically. Currently, the application measures scores for Facebook, Twitter, and LinkedIn accounts only.

 

Your Klout score is a compilation of three separate scores. First, there is your True Reach. This score measures the size of your audience by assessing the number of followers, friends, and how often they interact with your account. Second, there is your Amplification Score. From 1 to 100, this score measures the likelihood that your messages and posts will generate interactions. Third, you have your Network Score. Likewise, this score also ranges from 1 to 100 and measures how influential the engaged audience is.

 

Klout score and Six Sigma

 

Of course, the goal is always to gain more followers, friends, likes, and retweets. However, there are smarter ways you can gain traction while maintaining efficiency. For Six Sigma professionals, Klout scores calculate exactly how much influence you have within your online market. One of the most appealing characteristics of the application is the automatic and continuous data collection. While other market share analysis requires a team of professionals, your Klout score calculates automatically. Typically, your score updates every month. However, depending on your needs, you can change this.

 

When calculating your Klout score, there are three important things to remember. First, the application uses a finite number of variables. While some organizations may have data for all of these, others will not. For the most accurate calculation, make sure your social media accounts provide the necessary data. Second, social media influence changes drastically, and often. Every day there is a new hot topic, popular idea, or inspirational post. Likewise, it can be difficult to monitor the ever-changing trends and remain relevant. To combat this, we recommend appointing a social media manager to your team who can provide accurate analysis in combination with your Klout score. Last, always compare your score to both competitors and customers. In general, a score above 60 represents a strong online presence and influence. However, since each industry is different, compare your score to others and see where you rank.

Life After Master Black Belt (MBB)

For many Six Sigma professionals, the ultimate goal is to become a Master Black Belt (MBB). This certification is the top-ranking Belt one can achieve while following the methodology. However, you do not simply become a MBB overnight. Most professionals spend years in a technical role before engaging in the appropriate training. Likewise, the correct MBB training and certification course require weeks of participation and experience. However, once you do become a Master Black Belt, you achieve a goal most others dream of. Yet, what is next for your professional career after achieving Master Black Belt? Here are a few things you can do with your newfound certification.

Working on Better Projects

As a Master Black Belt, you will oversee almost all projects. You will report directly to executive management and stakeholders, when necessary. However, your role as a MBB is directly dependent on the project at hand. Sometimes, such qualification is not needed. In this case, you will work as a lower Belt or assist others in project operations. Yet, in other more dynamic and complex projects, your skill set is in high demand. Because these projects can vary in their availability, your role as a MBB might fluctuate. Keep in mind, though, that your qualifications alone will put you above other Six Sigma professionals. This means leading higher profile projects, more often!

Providing MBB and Other Training

Another way Master Black Belts spend their time after certification is by offering training to others. Because of your high certification, you can offer training to all levels of Six Sigma professionals. Whether you chose to offer private training one-on-one or work for your organization as a trainer, the options are endless. Many professionals find this opportunity as a great way to gain greater leadership experience. Since Six Sigma focuses on improving processes and reducing variation, you will lead your peers towards greater efficiencies and smoother operations.

Perfect Your Skillset 

While not strictly limited to MBB’s, another option is to seek training for weaker skills. Do you want to improve your understanding of advanced SPC methods? Do you need to review non-parametric analysis? At this stage in your Six Sigma career, you have covered countless topics over hundreds of hours. Sometimes, information can get mixed up or misplaced. Take this opportunity to refine your skills that you might struggle with. Of course, it doesn’t hurt to review material you already perfect.

Become a Master Black Belt Consultant

Finally, many MBB’s who have outgrown their corporate molds become independent contractors, working for themselves. While your organization may not be able to offer you the next challenging project or role, you shouldn’t remain stationary. Become your own employer and offer your technical skills as a service to other organization. Many Belts wander down this route, even as early as Green Belt certification. However, with the level of training and experience you have, you will be a step above other Six Sigma contractors.

Call it What You Like, but Success is Spelled DMAIC

We are running a series of sorts on different companies that have implemented Six Sigma into their company culture, and in turn have achieved monumental success. Today we will talk about The Vanguard Group. They are an investment management company based out of Malvern, Pennsylvania, and they have over $4 trillion dollars in assets under their management.

We are talking about trillions of dollars, not millions or billions…so let’s see what they are doing!

First of all, when you log onto their website, they tell you their strategy. “Our Long Term Strategy? Put Clients First.” What the phrase lacks in sophistication, it more than makes up for in intent, and of course their ultimate success.

How Six Sigma is a Living, Breathing Way of Life at Vanguard

Vanguard has literally institutionalized Six Sigma into the entire Vanguard group organization. This was shared as a talk at the Vanguard Group WCBF 2nd Annual Conference Six Sigma for Financial Services in New York, back on May 11th 2006.

Now fast forward to present day and they have assets in the trillions, so obviously implementing Six Sigma to the entire organization has its benefits and rewards.

Vanguard’s Everyday Approach to Excellence

DMAIC, which stands for Define-Measure-Analyze-Improve-Control, is the template that Vanguard uses everyday. Let’s see how well you can spot each acronym in their company process for excellence.

The jargon is different but process is Six Sigma. They use a dashboard, which is created by the team for the team to clarify exactly how the individual performance impacts the team, the department and ultimately the entire company.

Voice of the Crew: Here the crew members are encouraged to suggest what can be done to improve performances among fellow staff; this also helps identify and track suggestions made to supervisors. Crew led forums are done on a weekly basis for constant improvements as well as to maintain recent changes.

Broken Windows: These are seen as opportunities to improve; these are also seen as having an obvious root cause followed by an obvious solution. These would be quick fixes with quick wins that would have an immediate impact on the client or department and would become part of the improved process. Since the crew is encouraged to be proactive, morale is usually increased after this process.

Crew Development: This is what Vanguard calls the growth of crew members to become effective leaders.

Back to Basics: This is Vanguard’s program that focuses on people management. This program entails one-on-ones, personal performance measures, training, rewards and recognitions.

For more information on our courses or services, please visit www.mainvalue.in.

BOSTON-BASED SHIELDS HEALTHCARE GROUP FINDS SIX SIGMA KEY TO SUCCESSFUL OPERATION

For the past several years, new technology has been the focus of healthcare as an old industry looks for new ways to improve patient care and provide faster, more efficient services.

However, technology alone is not the answer. How that technology is applied can make the difference between a successful operation and one that struggles. To make the application of technology as efficient as possible, some in healthcare have turned to Six Sigma.

A case in point is Boston-based Shields Healthcare Group, which provides MRI, PET/CT and radiation oncology services at more than 30 hospitals in the New England area.

In a recent Health Information and Management Systems Society (HIMSS) conference in Orlando, Shields Chief Information Officer Chuck Spurr talked about how implementing Six Sigma proved to be a “change agent” for the company.

The Need For Process Improvement

Spurr spoke at a HIMSS conference forum called, “Driving Success With Collaboration and Six Sigma.” His talk focused on the idea that while new technology offers many improvements in healthcare, it also requires constant reevaluation of processes and a commitment to making them more efficient.

Shields turned to Six Sigma to accomplish that goal. The process improvement methodology provided Shields with the tools it needed to develop a system that gets various healthcare departments – each often working with their own software systems – to work together.

Six Sigma, started at Motorola in the 1980s, first focused primarily on manufacturing. But in the ensuing years, Six Sigma has been adopted by businesses across a wide variety of industries.

This has led to a growing number of people in business earning certification in Six Sigma and taking on a leadership role in improving a company’s operations.

Spurr himself is a Six Sigma Green Belt.

Key Elements of Six Sigma

In an interview conducted at the convention, Spurr talked about using Six Sigma for collaboration and the importance of communication overall.

“Six Sigma was our change agent,” Spurr said.

Communication is vital, he said, to ensure that software flows well across all systems within a company. A software product must be able to meet all the needs and answer all the questions of each different department, each of which may work with a system of their own.

Six Sigma has helped refine those processes, Spurr said, which can include issues such as cross-departmental communication and adding the right software “bolt on” to help individual systems work together.

He said Shield did not attempt to adopt every aspect of Six Sigma, but rather looked at areas that could immediately help the company’s performance.

Spurr said four key elements within Six Sigma proved vital. He said Six Sigma:

  • Tells you the direction a company is heading
  • Makes a company assess the current efficiency of its operation
  • Allows you to make quick changes
  • Allows you to develop methods for measuring success

“All wrapped around that is the data,” Spurr said. “You let the data drive you, which is a good thing when you are looking at a change agent.”

One of the keys for Shield was the Six Sigma methods of measuring success. As with other kinds of companies, all the data gathering and number-crunching changes nothing if there is no ability to measure the impact of changes.

“If the needle moves in the right direction, that’s awesome,” Spurr said. “If it doesn’t, that’s OK, too, because now you know what’s going on and you can react pretty quickly to it.”

Done in One: The Importance of First-call Resolution

For most contact centers, nearly one-third of inbound calls are repeat callers who weren’t satisfied the first time they called. More often than not, the antiquated switches that contact centers use don’t do a great job of reporting on the true first-call resolution (FCR) rate in a given center, so the problem may be even worse than it appears. Why is this?

Think of the iceberg analogy than Lean practitioners often use to explain cost of poor quality and the hidden costs that fall below the “water line.” What rises above that line is easy to quantify – it is the lowest-hanging fruit, so to speak, even though it is highest on the berg. Below the line, especially in contact centers, are problems like repeat callbacks, which is the opposite of FCR.

In pre-Six Sigma days, FCR at a call center was a blue-sky, nice-to-have metric, but nothing that managers held agents accountable for achieving. Instead, they opted for metrics focusing solely on time, like AHT (average handle time = talk time + post-call wrap up and any hold time during the call) or ASA (average speed of answer = how fast you pick up the phone).

What these metrics actually do is incite bad behavior. For example, an agent can keep both AHT and ASA low by just picking up a call and immediately hanging up on the customer, something many of us have experienced when we have phoned a call center. The agent AHT is an average of the daily AHT for a given time period, so naturally, if they hang up, they will have an AHT of a few seconds. Mix that into the normal AHT of an agent and, suddenly, their monthly stats look the lowest of any other agent.

See what I mean by inciting bad behavior? We like to call this “agent badness,” though personally, I think it is more of a sign that the agents are not getting adequate coaching (but that is for another article). AHT is influenced by multiple, equally likely root causes, so pinpointing improvements will only frustrate your Black Belts. I do not suggest contact center AHT projects for Green Belts ever, unless they are working on addressing a component of a larger Black Belt project.

By shifting your objective to improving FCR, however, you will have a much easier time proving and sustaining your results, namely reduced cost of goods sold and improved customer satisfaction ratings. A focus on FCR will also reduce customer churn and improve agent morale.

First, it helps to understand the inputs that affect FCR performance:

  1. Empowerment – Agents frequently don’t have the authority to resolve an issue, even when the solution is obvious. This results in call escalations to a higher tier, with increased hold time and abandonment. It also means the next callback will be an escalation call that ties up supervisor time.
  2. Coaching, not training – The agent may not have sufficient coaching time or ability to effectively deal with the customer call. Training has been proven to not move the needle at all whereas coaching is very successful at driving higher FCR rates.
  3. Information access – Agents need to find information more easily to provide answers or actions for customers. When the information is unavailable or difficult to access, sometimes agents will guess at answers or fail to provide them, both of which can lead to a callback.
  4. Back-end systems – These systems might not be up to the task. If the agent makes an address change, but it doesn’t propagate through the systems, then the customer will call back.
  5. Customer behavior – You need clues into customer perceptions and why the repeat calls are happening in the first place. This can help, for instance, when you discover customers are calling back trying to get a different result if their account is being suspended.

Improving FCR
Here’s how to get started with Six Sigma DMAIC (Define, Measure, Analyze, Improve, Control) project to improve FCR:

Step 1. Define: Conduct an information-seeking drill-down with subject matter experts (SMEs) who are proven resources in the center. This can help determine the objective and scope of your project. Those SMEs should also be a part of your project team.

Step 2. Measure: Track calls for a 30-day window in an Excel spreadsheet, if you do not have a more sophisticated system.

Step 3. Analyze: Flag repeat calls by analyzing agent logs and any interactive voice response (IVR) system data. (If you have an IVR or any other self-service tools, they should be included here). Identify whether an issue was resolved on the first call and, if not, the actual reasons for repeated calls. Look at all customer interface points because if the customer first contacted you via self-service systems, that counts as a call.

Step 4a. Improve: Make certain you provide a measurement system of record to measure FCR from the first day forward. You need useful information to conduct further root cause analyses and provide data for your control charts. What’s one ideal outcome? Could it be one where you continue to use the technology now in place, but make it work better for you? Or would it be better to leverage new technology?

Step 4b. Improve: Perform a measurement systems analysis (MSA) once that system is in place on IVR transactions and track where calls go once they are handled (defined as “the call is answered”). Look at calls and how the IVR is handling them. Many customers merely opt to zero out. That choice, however, isn’t giving you interpretable data. Callers choose to zero out for numerous reasons, including their desire to speak with a live agent.

One method of measurement can be a standard question that agents can ask the customer at the close of a call: “Is there anything else I can do?” or “Is this what you wanted?”

These questions allow a crude estimate of FCR. The best way to measure FCR as part of Improve is to add a question to your post-call survey (if you have one): “What your call successfully resolved the first time you called?”

If the answer is no, follow-up that question with a series of options, asking the caller why wasn’t it resolved during that first call: “a) Agent lacked authority; b) Agent lacked knowledge; c) etc.”

Step 5: Control – Build control charts around the “done in one” concept (a.k.a., FCR) and publish, like we do, to an intranet to which the agents have access. Make sure you multidimensionalize the intranet to allow agents to drill though center metrics to their individual agent FCR score.