What is Six Sigma project management?

At first glance, the Six Sigma methodology may look like something extremely complex and difficult to understand — but it is not that complicated. 

Whether you are already familiar with this project management methodology or you just stopped here to brush up on your knowledge — you are at the right place.

In this guide, we will explain what Six Sigma is in plain English and touch on the differences between PMP® and Six Sigma. 

In addition, we will describe the Six Sigma principles and determine the steps in the Six Sigma process. 

To illustrate the matter and ensure better understanding, we will also provide an example of Six Sigma in project management.

So, let’s get started.

What is Six Sigma, in simple words?

In a nutshell, Six Sigma is a statistical and data-driven methodology businesses use to reduce or eliminate defects and improve processes.

Engineers Mikel Harry and Bill Smith developed this methodology while working at Motorola in 1986.

The “Sigma” in the Six Sigma methodology means standard deviation.

The “Six” in Six Sigma represents six standard deviations between average and acceptable limits.

The more standard deviations fit between process average and acceptable process limits, the less likely the process is to perform above acceptable limits and cause a defect.

Six Sigma aims to increase customer satisfaction and profitability by:

• Streamlining operations, 
• Enhancing quality, and
• Eliminating defects in an organization’s processes.

We use it to improve products, services, and processes in:

• Production, 
• Product development, and 
• Many other disciplines.

Six Sigma definitions

According to the American Society for Quality, “Six Sigma is a method that provides organizations tools to improve the capability of their business processes.”

Investopedia further defines Six Sigma as “a set of quality-control tools that businesses can use to eliminate defects and improve processes to help boost their profits.”

The Council for Six Sigma Certification adds that the Six Sigma methodology is “a set of business tools, statistical theory, and quality control knowledge that helps improve your business procedures.”

Processes operating at the Six Sigma level produce only 3.4 defects per million opportunities. 

In Six Sigma methodology, opportunities refer to the number of chances for a defect. 

Presented in percentages, 99.99966 percent of the products operating at Six Sigma are without defects. 

Just one Sigma level below, 99.977 percent of the products are defect-free, and there are 233 defects per million opportunities. That number is significantly higher compared to 3.4 defects per million opportunities at the Six Sigma level.

The question is, how can you identify the Sigma level of your process?

Let’s take a look at the table that displays the universal Six Sigma scale:

Sigma level	Defects per Million Opportunities (DPMO)	PercentDefects (%)	Percent Success (Yield %)
1	691,462	69	31
2	308,538	31	69
3	66,807	6.7	93.3
4	6,210	0.62	99.38
5	233	0.023	99.977
6	3.4	0.00034	99.99966

We will elaborate further on Six Sigma calculations and provide a more detailed Six Sigma scale in the section dedicated to a Six Sigma example.

What is the difference between PMP and Six Sigma? 

While both PMP® (Project Management Professionals) certification and Six Sigma focus on specialized strategies to create better business outcomes, their approach is different.

So, what are the main differences between PMP® and Six Sigma?

Let’s take a look at the following table.

PMP®	Six Sigma
Focuses on improving the success rate of the projects.	Focuses on discovering and eliminating or reducing variations and defects within a specific process.
A PMP® professional utilizes standardized practices to efficiently deliver a project that satisfies a predetermined goal.	A Six Sigma professional uses data-driven methods and statistics to pinpoint and solve problems.
The focus is on completing a project by a specified deadline.	Six Sigma projects have a continuous control phase.
PMP® is the most industry-recognized certification for project managers.	Six Sigma is more commonly used in the manufacturing industry, where the methodology assists companies in achieving higher levels of product quality.
PMP® professionals focus on how to plan and execute a project.	A certified Six Sigma professional focuses on improving processes.
Requirements: – A four-year degree – 36 months leading projects – 35 hours of project management education/training or CAPM® certification – A high school diploma or an associate’s degree (or global equivalent) – 60 months of leading projects – 35 hours of project management education/training or CAPM® certification	Requirements vary based on the level of certification you’re pursuing.
The PMP® certification is only available through the PMI.	The Six Sigma certification is available through several organizations.

Even though PMP® and Six Sigma certifications are different, one does not exclude the other.

Six Sigma professionals are great at discovering and solving problems, while PMP® professionals are experts at delivering projects.

Having individuals with both Six Sigma and PMP® certifications may be an excellent advantage for any organization.

What are the Six Sigma principles?

The most common Six Sigma principles include the following:

• Focusing on the customer,
• Understanding how work gets done,
• Continuous process improvement,
• Reducing the variation,
• Eliminating waste,
• Teamwork,
• Flexibility, and
• Process control.

Let’s explain them in further detail.

Principle #1: Focus on the customer

The primary principle of Six Sigma is focusing on the customer. 

Every company must understand its customer needs and what drives the sales. 

Six Sigma is all about improving quality. It is important to measure quality in a similar way the customers do. 

Therefore, every business needs to analyze the quality of a product or service from the perspective of its customers and address their needs accordingly. 

Focusing on the customer enables a company to improve the quality of its products.

Principle #2: Understand how work gets done

You should trace the process steps to determine waste areas and gather data to discover any specific problem areas you need to handle or transform.

To be able to do that, you need the following:

• Clearly defined goals for data collection, 
• Purposes for data gathering, and 
• Expected insights. 

It is also necessary to ensure the accuracy of measurements and establish a standardized data collection system. 

For this Six Sigma principle, always verify the following:

• Whether the data enables you to achieve your goals, 
• Whether or not the data needs to be refined, and
• Whether you need any additional information. 

By doing this, you will identify the root of the problem you are dealing with.

How can you make sure you don’t miss something important?

You can use project management software like Plaky and employ this methodology effectively. Plaky is free for unlimited users and projects.

Using project management software allows you to organize all your data and track how well your business processes are performing. 

This way, you can easily determine which processes need your attention.

Principle #3: Continuous process improvement

Six Sigma methodology is based on continual improvement. 

After improving one area, an organization practicing Six Sigma moves to another. 

The goal is to reach the highest possible Sigma level for organizational processes — Six Sigma — with an accuracy of 99.99966. The closer you are to the Six Sigma level, the better.

Principle #4: Reduce the variation

Simply said, variation is a lack of consistency.

Reducing variations improves the process, and the customer experience becomes consistent. 

Let’s provide an example to make this clearer. 

Imagine running a burger bar and having 25 different burgers on the menu. Your workers must know which ingredient combination goes into each burger and how many ingredients to use. 

With many options available (i.e. ingredients), there is a higher chance of errors occurring. 

To reduce variation, you can instruct your employees to use a certain amount of each ingredient for every burger to ensure consistency in the final product.

Moreover, ingredients should always come from the same suppliers to avoid burgers tasting differently.

Principle #5: Eliminate waste

Eliminating waste is related to removing people, actions, or items unnecessary for the outcome of the process. 

Simply put, we should remove everything in the process that does not add to the customer’s value.

Eliminating waste reduces costs, processing time, and chances of errors.

How do you know what to eliminate? 

Let’s illustrate this by providing a simple example. 

Imagine running a small pizza place. 

To eliminate waste in your operations, you can ask yourself the following questions:

• Do I need 5 people to put the pizza together and serve it, or can 1 person prepare a pizza while the others serve the customers?
• How many suppliers do I really need?
• Do I need 15 pizzas on the menu, or is it better to have only the best-selling ones?
• Which pizza options are the most popular?
• Can I optimize the process by including only the best-selling pizzas in the menu and eliminating those nobody ordered in the previous three months?
• How much money do I spend on the ingredients for pizzas that are rarely ordered?
• How much money do I get from the best-selling pizzas compared to other pizza options I currently offer?

By identifying what is critical for your pizzeria, you will be able to find out what you can eliminate without compromising quality (and gain).

Principle #6: Teamwork

Teamwork is critical for Six Sigma’s success. 

The people on the team need to be trained and have knowledge of the Six Sigma methods of operation. 

Forming a cross-functional team consisting of team members with various skills and expertise will help identify any variation.

Experts in various domains can analyze the processes from several angles and point out (and discover the solutions for) the potential defects.

Principle #7: Flexibility

Six Sigma requires adaptability and a flexible and responsive system. 

Changes happen as faulty or inefficient processes are eliminated. 

Employees from all departments involved in the process should be able to adapt to these changes easily.

Processes also should be designed in a way that enables rapid and easy adoption. A great practice is to break them down into steps. This way, we can apply changes to only one step in the process that needs our attention without a necessity to change or adjust the entire process.

Principle #8: Process control

As we mentioned when comparing Six Sigma to PMP® certifications, Six Sigma projects have a continuous control phase.

After implementing improvements to your process, you can use measurements, statistics, and other Six Sigma tools to make sure the process you have improved stays in control.

What are the steps in the Six Sigma process? 

Six Sigma uses two approaches to make improvements and develop process control:

• DMAIC (Define, Measure, Analyze, Improve, and Control)
• DMADV (Define, Measure, Analyze, Design, and Verify)

Let’s explain what each one entails.

DMAIC

We use DMAIC to improve already existing processes. 

This approach incorporates the following steps:

• Define the problem, opportunity for improvement, goals of the project, and customer requirements.
• Measure how your process performs.
• Analyze the process to determine what causes poor performance (defects) and identify areas of improvement.
• Improve process performance by addressing and removing the causes of poor performance.
• Control how the process is implemented in the future.

The American Society for Quality recommends what tools and techniques to use for each step of the DMAIC process.

Let’s take a look at them.

DMAIC	Tools and techniques
Define	– Project charter – Voice of the customer – Value stream map
Measure	– Process map – Capability analysis – Pareto chart
Analyze	– Root cause analysis (RCA) – Failure mode and effects analysis (FMEA) – Multi-vari chart
Improve	– Design of experiments (DOE) – Kaizen event
Control	– Quality control plan Statistical process control (SPC)  – 5S Mistake proofing (poka-yoke)

DMADV

DMADV is focused on the process of designing a new product, service, or process. 

It incorporates the following phases:

• Define the purpose of a product, service, or project.
• Measure and determine the product, service, or process characteristics that are critical for their quality, including risk and production capabilities.
• Analyze the data you have to find the best design.
• Design the product, service, or process and test the prototype.
• Verify the effectiveness of the design via simulations and a pilot program.

Now, let’s take a look at the tools and techniques most frequently used for DMADV.

DMADV	Tools and techniques
Define	– Project Charter – Critical to Quality (CTQ) measures – Voice of the customer
Measure	– Control chart  – Pareto chart – Histogram
Analyze	– QFD – Prioritization matrix – FMEA
Design	– Design of experiments – Action plan  – TRIZ
Verify	– Control chart

Now that you know what Six Sigma is, what its principles are, and what hides behind DMAIC and DMADV acronyms, it’s time to talk about Six Sigma’s benefits for project managers.

What are the benefits of Six Sigma?

The benefits of Six Sigma include the following:

• Better decision-making,
• Less waste,
• Improved quality and customer satisfaction,
• Decreases operational costs, and
• Increased productivity.

Let’s take a closer look at each benefit.

Benefit #1: Better decision-making

Without proper measurement and analysis, an organization may make bad judgments leading to poor performance. 

When applying Six Sigma, all decisions are data-driven — you don’t rely on intuition or assumptions. Thus, Six Sigma enables better decision-making by relying on data analysis and improving processes based on measurements and metrics. 

Having accurate data allows you to make the right choices and find the best solution for process improvement. Using Six Sigma lets organizations:

• Determine what is wrong, 
• Validate their assumptions, 
• Brainstorm potential solutions for the problems the company is experiencing, and 
• Plan the necessary steps to avoid unwanted consequences. 

Benefit #2: Improved quality and customer satisfaction

There is a direct connection between the quality of products and customer satisfaction — the better your products are, the more satisfied the customers will be. 

Six Sigma helps reduce variations and defects, which contributes to the better overall quality of products and services.

Benefit #3: Less waste

Six Sigma relies on a set of statistical tools to identify and validate a process’ root problem. 

It helps your company optimize processes and decrease total waste.

Benefit #4: Lower operational costs

The core objective of Six Sigma is process improvement. 

As we previously mentioned, Six Sigma reduces problems to 3.4 defects per million opportunities. 

Thus, Six Sigma significantly reduces expenses, as defective processes cost you money — organizations spend extra time fixing defective products and dealing with dissatisfied customers. 

Simply put — an efficient manufacturing process is less expensive, and Six Sigma makes it possible.

Benefit #5: Increased productivity

Applying Six Sigma to your processes boosts efficiency and allows for better time management.

By identifying problematic areas and optimizing your processes, you help your teams operate more efficiently. 

In addition, you avoid having the same problems repeat in the future and eat up your time, as Six Sigma helps you identify their roots.

Six Sigma belts

Six Sigma has nothing to do with martial arts. 

However, its practitioners hold different color belts corresponding to the ones used in martial arts.

The rankings of the Six Sigma belts include the following:

• White Belt,
• Yellow Belt,
• Green Belt,
• Black Belt, and
• Master Black Belt.

In addition to these five belts, there are two more Six Sigma roles:

• Six Sigma Champions, and
• Six Sigma Executives. 

The purpose of these two roles is to set the direction for selecting and deploying projects.

White Belt 

White Belt holders are the ones with an elementary level of Six Sigma training. 

A White Belt training is an excellent option for auxiliary staff members as it can help them understand why project teams work in a particular way.

White Belts can work on local problem-solving teams that support overall projects. However, they may not be part of a Six Sigma project team.

Yellow Belt

One step above the White Belt is the Yellow Belt certification. It is also an introductory position within Six Sigma. 

Yellow Belts are regular project team members responsible for identifying processes that need improvement. 

They work under the guidance of those with higher belt ranking — Green and Black Belts.

Green Belt

Certified Green Belts are Six Sigma team members who supervise the Yellow Belts and are usually under the supervision of Black Belts or Master Black Belts. 

They assist with data gathering and analysis for Black Belt projects. 

However, unlike Yellow Belts, they can lead smaller projects as well.

Black Belt

Certified Black Belts are team leaders for Six Sigma projects. They train and coach project teams. 

Black Belts do the following:

• Explain Six Sigma principles, including the supporting systems and tools,
• Demonstrate team leadership,
• Understand team dynamics,
• Delegate team member roles and responsibilities,
• Understand all aspects of the DMAIC model, and
• Have basic knowledge of Lean enterprise concepts.

Master Black Belt

Master Belts are the highest level Six Sigma in-house authorities who train and coach Green and Black Belts. 

They are experts in the methodology, resources, and practices of Six Sigma.

Six Sigma champions

Six Sigma Champions translate the company’s mission, vision, and values into a Six Sigma deployment strategy that supports the company’s goals. 

They also do the following:

• Guide the team,
• Remove obstacles that could hinder process success,
• Ensure the project is aligned with the company’s goals,
• Maintain team focus, and
• Ensure projects are completed on time.

Six Sigma Executives

Six Sigma Executives have the most training and experience. They hold the highest level in the Six Sigma hierarchy. 

According to the American Society for Quality, Six Sigma Executives “provide overall alignment by establishing the strategic focus of the Six Sigma program within the context of the organization’s culture and vision.”

–

Now that you have mastered the Six Sigma basics, it’s time to show you how to determine the Sigma level of your process — with the help of an example.

What is an example of Six Sigma in project management?

Suppose you run an online clothing shop and want to determine your current Sigma level. 

For 580 orders your customers received last week, your company has received 11 complaints. 

The number of orders can be your sample size (580). 

The number of complaints is actually the number of defects (11). 

The complaints were related to the wrong color, wrong size, or wrong product type shipped — these categories represent opportunities for defects. 

Calculating your Sigma level

We can use the following formulas for the Sigma level calculations:

• Defects per unit

DPU = number of defects / number of units

• Defects per opportunity

DPO = number of defects / (number of units x opportunities per unit)

• Defects per million opportunities

DPMO = [number of defects / ( number of units x defect opportunities per unit)] x 1,000,000 or 

DPO x 1,000,000

• Yield — the ability of a process to produce defect-free units

Yield = 1 – DPO

Let’s calculate the values based on the data we have.

Number of units: 580 

Number of defects: 11

Opportunities per unit: 3 (size, color, clothing type)

DPU = number of defects / number of units

DPU =11 / 580 

DPU = 0.019

DPO = number of defects / (number of units x opportunities per unit)

DPO = 11 /( 580 x 3)

DPO = 0.0063218391

DPMO = DPO x 1,000,000

DPMO = 0.0063218391 x 1,000,000 

DPMO = 6,321.8391

Yield = 1 – DPO

Yield = 1- 0.0063218391 

Yield = 0.9936781609

Yield (%) = 99.36781609

Then we have to take a look at the Yield to Sigma conversion table and identify our process Sigma level.

Yield %	Sigma	Defects Per Million Opportunities
99.9997	6.00	3.4
99.9995	5.92	5
99.9992	5.81	8
99.9990	5.76	10
99.9980	5.61	20
99.9970	5.51	30
99.9960	5.44	40
99.9930	5.31	70
99.9900	5.22	100
99.9850	5.12	150
99.9770	5.00	230
99.9670	4.91	330
99.9520	4.80	480
99.9320	4.70	680
99.9040	4.60	960
99.8650	4.50	1,350
99.8140	4.40	1,860
99.7450	4.30	2,550
99.6540	4.20	3,460
99.5340	4.10	4,660
99.3790	4.00	6,210
99.1810	3.90	8,190
98.9300	3.80	10,700
98.6100	3.70	13,900
98.2200	3.60	17,800
97.7300	3.50	22,700
97.1300	3.40	28,700
96.4100	3.30	35,900
95.5400	3.20	44,600
94.5200	3.10	54,800
93.3200	3.00	66,800
91.9200	2.90	80,800
90.3200	2.80	96,800
88.5000	2.70	115,000
86.5000	2.60	135,000
84.2000	2.50	158,000
81.6000	2.40	184,000
78.8000	2.30	212,000
75.8000	2.20	242,000
72.6000	2.10	274,000
69.2000	2.00	308,000
65.6000	1.90	344,000
61.8000	1.80	382,000
58.0000	1.70	420,000
54.0000	1.60	460,000
50.0000	1.50	500,000
46.0000	1.40	540,000
43.0000	1.32	570,000
39.0000	1.22	610,000
35.0000	1.11	650,000
31.0000	1.00	690,000
28.0000	0.92	720,000
25.0000	0.83	750,000
22.0000	0.73	780,000
19.0000	0.62	810,000
16.0000	0.51	840,000
14.0000	0.42	860,000
12.0000	0.33	880,000
10.0000	0.22	900,000
8.0000	0.09	920,000

Based on this table, our Sigma level is between 3.90 and 4.

That means we can take actions to reduce the number of defects and achieve the best-case scenario — 3.4 defects per million opportunities.

Let’s calculate the number of defects for the Six Sigma process using the data we have.

Units: 580 

Defect opportunities per unit: 3 (size, color, clothing type)

At the Six Sigma level, the number of DPMO (defects per million opportunities) is 3.4. 

So, we can calculate the DPO (defects per opportunity) by using the formula for DPMO, as we already know the value for DPMO.

DPMO = 3.4

DPMO = DPO x 1,000,000

3.4 = DPO x 1,000,000

DPO = 3.4 / 1,000,000

DPO = 0.0000034

Now, we have the value for DPO, and we can use the formula for DPO to calculate the total number of defects.

DPO = number of defects / (number of units x opportunities per unit)

Defects = (units x opportunities per unit) x DPO

Defects = (580 x 3) x 0.0000034

Defects = 0.005916

Let’s compare our process performance at the current Sigma level to the one at the Six Sigma level.

Defects per million opportunities Current Sigma level (between 3.90 and 4)	Defects per million opportunities Six Sigma level
DPMO = 6,321.8391	DPMO = 3.4

As we can see from the table, the number of defects per million opportunities is significantly lower at the Six Sigma level, than the one we are currently at (between 3.90 and 4).

We can use the DMAIC approach mentioned in this article to improve the process and reach the Six Sigma level.

Wrapping up: Six Sigma significantly improves your business processes

Six Sigma is a methodology that enables companies to achieve optimal business processes by identifying any weak points and acting on them. 

It helps remove defects, reduces variations, and improves productivity. 

In addition, Six Sigma emphasizes the value of focusing on the customer and customer satisfaction. 

Finally, using this methodology can improve your processes and reduce costs due to fewer defects.

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