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Executive Summary

Since Six Sigma was first developed at Motorola, refined at AlliedSignal and transformed into legend at GE under Jack Welch, it has found application in myriad business
sectors. This successful quality initiative is revolutionizing not only manufacturing, but also service industries, including outsourcing, financial services, health care and tele-communications organizations.

Six Sigma is originally designed to perfect manufacturing processes that were already highly engineered and might seem ill-suited to service organizations, wherein processes aren’t engineered at all. But this is precisely why the methodology has something valuable to offer service organizations. Because many service businesses (which often suffer from inflated costs and poor customer service) have never analyzed their processes, they are ripe with potential for improvement. When the global economy is services-driven and more than 75% of the GDP of most developed countries is contributed by services, the role of six sigma becomes much more relevant. India, though known globally for services offered in the field of IT, BPO, finance, healthcare, telecommunication, etc., has been losing its competitive advantage of low cost to countries like Indonesia, Philippines, etc., due to appreciating rupee, increasing labor cost and increasing cost of poor quality. In order to sustain this lead, India has to improve the quality of services offered and the skills of the workforce. By identifying what are the critical to quality factor for our customer and what is voice of our business, we could pin-point specific areas for six sigma application that could give sustainable competitive advantage to Indian service sector.

Service processes are subjected to more noise or uncontrollable factors due to human intervention at every stage. The intangibility of services offered and variability of perceived delivered quality is major set-back for application of traditional quality control tools like ISO 9000, TQM, etc. However, the closeness and direct interaction services organization have with customer supports the application of six sigma, which is highly dependent on reliable data. Six sigma offers a robust methodology of continuous improvement by inculcating both qualitative and quantitative aspect of services. Six sigma follows the DMAIC (Define Measure Analyze Improve Control) approach to problem solving and DMADV (Define Measure Analyze Design Verify) for new process development. Either the Voice of Customer (VOC) or Voice of Business (VOB) acts as a source for identification of major improvement areas.

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* Contributed by: -
Aniket Raj Agarwal & Nikhil K. Jainender,
Symbiosis Institute of International Business, Pune.