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About this lesson

Lean Six Sigma is a problem solving methodology. In this methodology, many common terms have specific meanings. Understanding the use of the terms within the Lean Six Sigma methodolgoy will avoid confusion and clarify communication.

Quick reference

Lean Six Sigma Definitions

There are several sets of terms that will be used frequently throughout the course and it is helpful to understand their definition and usage to avoid confusion.

When to use

These definitions and descriptions will have applicability at every stage of a Lean Six Sigma project. Some of these are common terms with many potential meanings. Using the correct term and in the correct manner will enhance communication.

Instructions

The first term is sigma which is often used with the modifier six sigma. There are many ways this term is used. It origin is in the Greek alphabet where it is the 18th letter. In the project management perspective, it is used to name the five-phase project management methodology used for problem-solving. It also has become an umbrella term for the set of statistical and problem-solving tools used in the five-phase methodology. In statistical analysis, it stands for the standard deviation when is a measure of variability in the data.  In fact that standard deviation attribute leads to several additional uses for the term. There is the measure of process variability, which is based on the number of standard deviations, sigmas that fall within the customer’s spec limits. This is often referred to as process capability. In many cases, a company will benchmark its process capability, as measured with sigma. When the Six Sigma initiative took off in industry, sigma levels became goals written into specs, and the struggle to improve sigma because a philosophy of life with some individuals. 

Another set of terms are the “voice” terms, voice of the customer (VOC), voice of the business (VOB, and voice of the employee (VOE). All three are attempts to understand the real world that is being analyzed in the Lean Six Sigma project. Therefore, all three should be based on hard data, not gut feelings or isolated anecdotes. VOC is the customer’s opinion of the products and services. This may be directly stated, or indirectly inferred by the customer’s actions, such as returning products or canceling subscriptions. The VOB is usually captured in the business and process KPIs. The metrics tell the managers and supervisors what is actually being done in the business processes. The VOE is a measure of the corporate culture. It is an assessment of employee perspective on work practices and business health.

The third definition I want to introduce is common cause and special cause. All processes have variation. Some of that variation is based on the noise and uncertainty in mother nature and the systems in the environment of the process under investigation. Those sources of variation are called common cause. The occur all the time and they occur in a manner that is predictable in terms of frequency and magnitude, although the occurrence of any specific level of variation is random. We should expect and plan for the level of common cause variation. The other variation is special cause and it is not random in nature. The process variation is traceable to a very specific cause that is outside the control of the process. When this cause happens it creates an immediate impact on the process. Because it is outside the process, the process cannot predict its occurrence. These types of variations can only be avoided by putting external controls around the process.

Each of these definition topics will be covered in more detail in later lessons.

Hints & tips

  • Understanding these terms and their use will improve communication in this program.
  • Sigma can be used in several ways, consider the context of the statement when deciding how to interpret it.
  • Some senior managers may override the “voices” based on their anecdotal experience. Be sure to have data for your voices and you are ready to explain where the data came from and why it can be trusted.
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  • 00:04 Hi, this is Ray Sheen.
  • 00:06 I'd like to take a few minutes and define some terms that you will hear me use
  • 00:10 dozens of times in the next few lessons.
  • 00:13 In fact, I'll start with the term sigma.
  • 00:16 It's used in many ways and you need to be familiar with all of them.
  • 00:20 Of course, the Greek scholars among us will recognize that sigma is the 18th
  • 00:24 letter of the Greek alphabet.
  • 00:26 It's also part of the lean six sigma name of the continuous improvement methodology
  • 00:32 based on the five stages of define, measure, analyze, improve and control.
  • 00:38 For a distribution of the numbers, sigma is a specific value that
  • 00:42 represents the standard deviation associated with that set of numbers.
  • 00:47 Related to that definition,
  • 00:49 sigma is also used to express the level of variability within a process parameter.
  • 00:55 In particular, the sigma level is associated
  • 00:58 with how many standard deviations between the mean value and the spec limits.
  • 01:04 The level of variability is associated with the concept of process capability,
  • 01:09 which will be discussed in another lesson.
  • 01:12 The process capability can be expressed as a sigma value.
  • 01:16 Within the context of lean 6 Sigma quality operations, sigma can be a benchmark.
  • 01:21 So saying a process is a 6 Sigma process means that it has
  • 01:25 the expectation of only 3.4 defects per million.
  • 01:30 That's as compared to a 1 Sigma process which is 50,000 defects per
  • 01:34 million opportunity.
  • 01:37 Because it is a benchmark,
  • 01:39 it can also be used as a goal such as setting a goal for a 4 Sigma or
  • 01:43 a 5 Sigma in your process as you are on the way to a 6 Sigma performance level.
  • 01:49 For some people, 6 Sigma mindset becomes a personal philosophy.
  • 01:55 They seek to always rely on data when making decisions in life.
  • 02:00 But if we go back to the 6 Sigma as a methodology,
  • 02:03 it is not only the five phases.
  • 02:06 It is also a set of tools for
  • 02:07 each of those five phases that lets us make decisions based upon data.
  • 02:13 Another set of terms that I will often be using are the voice terms VOC,
  • 02:19 VOB, and VOE.
  • 02:20 The best known of these terms is the voice of the customer, VOC.
  • 02:25 This means working with the customer to find out what the customer wants and
  • 02:29 how the customer truly perceives our product or service.
  • 02:34 VOB is the voice of the business.
  • 02:36 This is usually found in the metrics and KPIs of the business.
  • 02:40 It is an indication of whether the business processes that are associated
  • 02:44 with the product or service we deliver are sustainable, are they operating smoothly,
  • 02:49 or are they stretched to the very max and full of problems.
  • 02:53 VOE is voice of the employee.
  • 02:56 This is associated with employee satisfaction and the work culture.
  • 03:00 Do the employees feel they are treated fairly, and
  • 03:03 is the company living up to the expectations it has set?
  • 03:07 All three of these voices are based on data.
  • 03:11 The company has metrics associated with each of these, and
  • 03:14 those metrics are monitored and used in decision making.
  • 03:18 The third terminology that you will hear me use is that of special cause and
  • 03:23 common cause.
  • 03:25 Common cause is a source of process variation that is common to the work
  • 03:28 environment.
  • 03:30 Every process has some level of background noise and variation.
  • 03:33 These are the common causes of variation.
  • 03:36 They're random in nature, but they are predictable within bounds.
  • 03:40 In fact, the variation is normally represented with the normal curve,
  • 03:43 also known as the bell-shaped curve.
  • 03:46 Fortunately, since it is predictable, it can be modeled.
  • 03:50 Common cause variation cannot be avoided, so the process must be designed and
  • 03:55 expectations set for a particular level of variability.
  • 03:59 If the variability is too high to meet the business need,
  • 04:03 a new process must be implemented that has lower common cause variation.
  • 04:09 We contrast this this with special cause variation.
  • 04:13 This is variation that happens outside the control of the process.
  • 04:17 The variation occurred because something else happened.
  • 04:20 Therefore, it's not random, it directly follows the outside cause.
  • 04:25 Now that outside cause may be random.
  • 04:28 But once it occurs, the process variation is not random, it happens.
  • 04:33 For example, if lightning strikes, it will fry the electronics in our test equipment,
  • 04:37 and that underlying cause is not controllable by the process manager.
  • 04:42 Since it is not controlled by the process, it cannot be mathematically modeled.
  • 04:47 To control for these types of problems,
  • 04:49 you may not need to change your core process.
  • 04:52 Instead, incorporate some type of check for that condition, so that you
  • 04:57 know when it is impending, and can then take actions to avoid the situation.
  • 05:02 Terms like sigma, special cause, common cause can take on many different meanings.
  • 05:07 We took this time so
  • 05:08 that you would understand how we will be using those terms in these lessons.

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