Six Sigma has taken over the manufacturing/production industry due to the benefits associated with the methodology. It has even been utilized by the U.S. government to fight the war on terror, in hospitals to aid with cutting wait times, and especially within the automotive industry. The Six Sigma methodology has served a diverse customer base, especially those across different parts of the world delivering a host of benefits.
As Six Sigma has taken a rise amongst many operations around the world, there are many advantages that come with it that can effectively improve your operation. Therefore, in this blog, we are going to discuss the benefits of utilizing six sigma within an operation - particularly manufacturing.
5 Benefits of Six Sigma
The five benefits pertaining to six sigma include the following:
- Reduce Operational Costs - Reducing operational costs is a goal for many companies around the world. Operational costs contribute to low profits or even losses at some points within the company. Six Sigma and Lean both specialize in continuous improvement and the overall reduction of operational costs. This is conducted through eliminating waste within the operation, improving efficiency, and ultimately ensuring the products are delivered in the most timely manner possible.
- Improve Efficiency - Efficiency, or timeliness, is by far one of the other most important aspects to manufacturing operations. Six Sigma aids in the improvement of efficiency of the overall process. Improving the timeliness in delivering the process output or improving on-time delivery of products or services can be the main focus of Six Sigma projects. In order to improve timeliness, Six Sigma projects are able to be targeted toward reducing the number of machine set ups or set up hours in a manufacturing process. By far, this is one of the most substantial benefits of Six Sigma.
- Improve Accuracy - Six Sigma is able to improve accuracy through reduction of Defects-Per-Million-Opportunities (DPMO) across the value stream in the process. ‘Opportunity’ means the chance to commit an error. DPMO is a probabilistic measure of error rate or capability of a business or manufacturing process. This measure will ultimately take into account both actual defects and number of probable defects in every opportunity. Once these are identified, the Six Sigma methodology then allows for you to come up with a plan and locate areas where there could be improvement.
- Improve Customer Service - Customer service is one of the most important aspects that can make or break maintaining customers. The image of the company in part is created through the interaction with customers. Any company would want this interaction to be stable as possible. Six Sigma projects specialize in improvement of customer satisfaction through effectively enhancing the production process and reducing overall lead time.
- Improve Cash Flow - Six Sigma projects can also be targeted toward improving DSO in the business. If DSO improves, then cash flow will improve as well. The higher the DSO, the lesser the ability of the company will be able to convert credit sales into cash. Six Sigma is able to effectively reduce variation in the invoicing process, accounts payable process, and accounts receivable process.
Understanding the benefits of Six Sigma will enable you to enhance your overall operation through the many benefits associated with the methodology. A software that is able to aid with Six Sigma methodology and implementation is PlanetTogether’s Advanced Planning and Scheduling (APS) Software. Advanced Planning and Scheduling (APS) Software is a must for manufacturers that are seeking to enhance their operation through waste elimination and profit increase. Advanced Planning and Scheduling (APS) Software provides thorough visibility into an operation and locates areas where bottlenecks may be prevalent and ultimately comes up with an elimination plan. APS Software is a must for manufacturers that are seeking to maintain a competitive edge and ultimately enhance their operation as a whole.
Advanced Planning and Scheduling Software
Advanced Planning and Scheduling (APS) software has become a must for modern-day manufacturing operations due to customer demand for increased product mix and fast delivery combined with downward cost pressures. APS can be quickly integrated with a ERP/MRP software to fill gaps where these system lack planning and scheduling flexibility and accuracy. Advanced Planning and Scheduling (APS) helps planners save time while providing greater agility in updating ever-changing priorities, production schedules, and inventory plans.
- Create optimized schedules balancing production efficiency and delivery performance
- Maximize output on bottleneck resources to increase revenue
- Synchronize supply with demand to reduce inventories
- Provide company-wide visibility to capacity
- Enable scenario data-driven decision making
Implementation of Advanced Planning and Scheduling (APS) software will take your manufacturing operations to the next level of production efficiency, taking advantage of the operational data you already have in your ERP.
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Topics: six sigma