Discernment, grant me Six Sigma tools to optimize existing processes, Agile approach to create new products, and wisdom to know the difference. (And maybe a cheat sheet).

Posted by Verarius
16-02-2024

Did you hope to bring more stability in your operation, but ended up in total chaos? Or was the goal to bring about a technological breakthrough, but you caught yourself enslaved to sunk costs and the whole thing became a nightmare? It is a good practice to take a step back every now and then and look at the tools for what they are – not only to admire their sheer beauty, but also to adjust your approach. As this is one of those things that are so much more fun when done in a pleasant company, let’s get to it together today!

One of the most frequent confusions in project management that leads to subpar results is the wrong choice between the Six Sigma and Agile. While both tools have their virtues, the value for a concrete project does depend on their applicability for a task at hand. More to the point, applied to the wrong task Six Sigma or Agile tools will be detrimental to the results. You will be running the risk of suddenly catching yourself hammering nails with a rubber hammer – not only will the nail refuse to enter, but you will also get a black eye from a clumsy ricochet.

Six Sigma toolkit and Agile approach are both very powerful. However, once you get into the habit of using one of them, it can become your go-to modus operandi and even religion. But first things first – if we decided to take a step back, what are the tools and what were they created for in the first place? Six Sigma as a methodology appeared back in the 80ies of the 20th century for process improvement and aimed at enhancing the quality of manufacturing outputs. Six Sigma focuses on identifying and removing the causes of defects and minimizing variability in both manufacturing and business processes. Namen est omen: "Six Sigma" is the reference to the goal itself. That is, the reduction of defects to the point of fewer than 3.4 defects per million opportunities, assuring that the mean output is within +/- six standard deviations from the specification limit. This means a very high level of quality and minimal variation in the manufacturing outcome and, hence, in the process itself. Moreover, this suggests the following: you need a significant underlying volume of transactions or production to let the law of large numbers work its magic for you. To attain this goal, several tools were introduced, the most prominent of them being:

  • the famous DMAIC (Define, Measure, Analyze, Improve and Control) as a structured process improvement methodology;
  • SIPOC as a tool for the visualization of process elements;
  • Cause and Effect diagrams (also known as Fishbone Diagrams) as a tool to identify root causes of effects;
  • FMEA (Failure Modes and Effect Analysis) as one of the main tools to evaluate potential failure points in processes.

For some time, the Six Sigma toolkit was able to satisfy the most pressing business requirements: providing you a cost-efficiency driven edge. These requirements, in turn, found their reflection in project management and so Six Sigma became a natural go-to method. And then the XXI century rushed in…

With the swift development of the software industry within an ever faster paced environment, project management faced challenges unseen before. These unique challenges required unique responses and the Agile manifesto became such a response. In essence, it was the reflection of the whole era from the project management perspective: the emphasis moved to flexibility, collaboration, customer feedback, and rapid response to change. This translated into constant iterations, questioning of status quo, prototyping, increasing variation… To that end, inspired by the Agile manifesto, the following methodological tools (or frameworks) were created, to name but a few:

  • SCRUM that slices and dices the work to be completed into sprints, short time periods for the completion of specific assignments with short standing meetings to assure dynamic interaction;
  • User Stories as a means of capturing product features form the end-user’s perspective.

Not planning the whole project till the very end, not taking prototype to the stage of the mass production, and even not having a plan at all became a virtue, not a mortal sin in this set-up. Instead of capitalizing on the law of large numbers to gain an edge, it is the increase of “surface area of luck” that Agile is aiming for. The larger the surface for trial and error, the higher are the chances for a break-through product, which you need to become the best-in-class.

This brief (and, yes, a bit simplified) description of the methods reminds us for what purposes these tools are best for: when it comes to “ideating”, creating something new, never becoming tired of trying, you go for Agile methodologies. Once you get into the calm waters of everyday routines and activities, Six Sigma toolkit is much more likely to have a nifty gadget for you. You might have different areas of your business which require different approaches at the same time, and there is no contradiction here.

To sum-up, here is a quick cheat-sheet for you. Before picking your battle and then choosing your weapon, it can become a good habit to ask yourself a set of questions:

Aren’t there any grey areas, you might ask? Isn’t a combination of both possible? Can’t we, for example, design a process or create a product outright focusing on “getting it just right”? Yes, to some extent it can be possible, and we’ll definitely talk about it at some point.

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