Why are Companies Constantly Upgrading their ERP Systems?
February 7, 2025
Bankruptcy is one of the natural states which a company may find itself in. Entrepreneurship is primarily about taking risks. When companies take risks, some of them succeed, whereas others fail. Hence failure is a natural part of the business. However, many critics of bankruptcy laws believe that there isn’t a need for an elaborate […]
What is the Wirecard Scandal all about and Why it is a Wakeup Call for Whistleblowers Anyone who has been following financial and business news over the last couple of years would have heard about Wirecard, the embattled German payments firm that had to file for bankruptcy after serious and humungous frauds were uncovered leading […]
How Modern Decision Makers Have to Confront Present Shock and Information Overload We live in times when Information Overload is getting the better of cognitive abilities to absorb and process the needed data and information to make informed decisions. In addition, the Digital Age has also engendered the Present Shock of Virality and Instant Gratification […]
Geopolitics, Economics, and Geoeconomics In the evolving global trading and economic system, firms and corporates are impacted as much by the economic policies of nations as they are by the geopolitical and foreign policies. In other words, any global firm wishing to do business in the international sphere has to be cognizant of both the […]
In the previous article, we have already come across some of the reasons why the government should not encourage funding of stadiums that are to be used by private franchises. We have already seen that the entire mechanism of government funding ends up being a regressive tax on the citizens of a particular city who […]
The mention of the Measure phase of the Six Sigma module brings into mind pictures of statisticians performing complex operations on data to derive meaning out of it. While this is true to some extent, the complexity of the process is highly over-rated. True, that there is a tremendous amount of statistics involved. However, in recent times, the statistics part is being taken care of by the software. Humans need to understand the logical part of the process and provide input to the software and interpret its outputs. The major objectives of the Six Sigma module are mentioned below:
The Six Sigma project team needs to come out with an explicit list of vital inputs, desired outputs and process metrics that they are planning to track. The fact that there are probably hundreds of metrics makes it important to identify and list the vital few. This decision has large scale implications on the performance of the project and is usually taken by the Project Lead on the basis of data provided by the Six Sigma team and the Process Owner.
There have been many cases of measurement bias in Six Sigma history. The bias may have its roots in the complexity of the calculation, the wrong method of data collection or the bias of the person performing the exercise. However, methods have been developed to get rid of all these errors. Measurements are taken automatically, calculated automatically and sent to the concerned managers automatically who use pre-defined rules to make a decision.
One of the biggest challenges of this phase is to validate the fact that the measurement system in place is good for the purpose. We have discussed this challenge in detail in the section titled Management Systems Analysis.
Measure phase also includes collecting the measures that the current process has. This includes measuring the defects per million. Once the defects per million are calculated, the current Sigma Level of the process is found out. This gives the team an idea of the effort that may be required out of them.
A common practise in the measure phase is to put a figure in front of the losses that the organization is currently facing due to inefficient processes. This helps the management valuate the process and the Six Sigma team can bargain for more resources to successfully implement the project. The financial numbers help re-iterate the project value in front of the Project Champion and the Senior Management.
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