Six Sigma And Project Management Literature Review

INTEGRATION OF SIX SIGMA AND PROJECT MANAGEMENT

LITERATURE RESEARCH

1. Introduction

In today's global business environment, the importance of first-to-market, customer service, cost-competitiveness, and quality are key factors in determining an organization's success, or undesirable failure. Manufacturers, engineering and transactional firms share a drive to lower costs, reduce cycle time and offer a diverse product mix as they pursue higher profits and an increased market share in a growing global environment.

As an effort to secure a competitive edge in its respective industries, organizations are seeking ways to increase efficiency and guarantee successful execution of critical business processes. A variety of systems - such as Total Quality Management, Total Quality Control and Six Sigma - have been implemented by organizations to help guide the efforts of creating new products, reducing product costs, improving manufacturing or organizational capabilities, realizing new market share or entering new markets. These systems rely on teams of people to identify the voice of the customer (both internal and external), taking into account the organization's competencies. They also require an ongoing portfolio of projects aimed at creating revenue or reducing costs.

Some organizations have integrated two or more systems. One melding of systems that hold significant promise is the integration of the Six Sigma methodology with the tools and processes of Project Management which is the main topic of this work. In this sense it is important to say that the purpose of this Literature Research is to demonstrate how organizations are able to achieve sustainable and effective process improvement by identifying how the combination of Project Management best practices with certain Six Sigma methodologies provides the structure and discipline required to identify process improvement opportunities, develop sustainable solutions, and lead organizations through the strategic change process.

2. Methodology

In the previous paragraph I established that the intention of this work is to show the potential benefits and implications of the Integration of Six Sigma Method with Project Management best practices and tools. This will be done by presenting a review of the most relevant information that can be currently found in academic and technical journals, and also in specialized books related with this important topic, that might not only function as an account of the present stage of theorizing, but also open up the discourse for new developments and new combinations of perspectives.

Some limitations are necessary to be established in order to properly fulfill this task. First, the attention of this work was given to research that has directly been done to develop elements of analysis regarding the integration of the Six Sigma and Project Management methodologies. This statement is important, since it means that some elements such as the general concepts and definitions of Six Sigma and Project Management were limited only to the journals and papers related to the main topic of this research. This also means that studies on specific topics of each Methodology, such as Design of Experiments or Risk Analysis, have been considered to be beyond the scope of this work.

And second, I will use the contents of the reviewed material in different sections and subtopics, each of them related to an important discussion element of the Six Sigma and Project Management methodologies. I consider this is a very appropriate way to give a formal structure to this work and also to develop a comprehensive synthesis of the material that I found during my research. In this sense, it is important to say that some of the papers cover similar information (since they were written by the same author(s)), and in an effort to avoid repeated recurrent references I will quote the paper or papers that I consider are more relevant for the correspondent section of this report.

This work was developed in different steps: Preliminary analysis and collection of key cited articles, literature search in technical journals, and search for other published work by author. The keywords used were ''Six Sigma", ''Design for Six Sigma" and ''Project Management''. At the same time, additional information was gathered from scholarly books in order to support this study. The intention was primarily to support and improve the information of each of the sections and to use existing knowledge on Project Management and Six Sigma literature as far as possible despite the limited number of papers that I found on the literature search.

3. Six Sigma: concepts and definitions

Before we can go any further into the discussion of the findings of this literature research about the benefits and implications of the integration of Six Sigma and Project Management, I consider that it is very important to outline the basic concepts of each of those methodologies so that it will be possible to understand the fundamental principles of their interaction in the improvement strategy of an organization.

In this sense, Kwak Y.H. and Anbari F.T. [4] present an excellent definition of the Six Sigma Methodology as a "project driven" business strategy that allows an organization to focus on the improvement of its processes based on a deep understanding of its customer's requirements and the continuous reduction of defects in all the activities of the organization.

As it will be explained later, the processes improvement is achieved in a project by project basis (this is why Six Sigma can be categorized as a "project driven" methodology), where each project is established with the purpose of solving a problem or taking advantage of an improvement opportunity, and is executed through a methodology based on the perfect integration of "knowledge of the process, statistics, engineering, and Project Management" [4].

In fact, we can properly summarize the Six Sigma Management method using the following Equation developed by Anbari F.T. [2, 3]:

Six Sigma = Total Quality Management (or Continuous Quality Improvement) + Additional Data Analysis Tools + Stronger Customer Focus + Financial Results + Project Management

According to the previous definition, the Six Sigma methodology can be explained from two points of view [4]: the Statistical point of view, and the Business point of view. In the first point of view, Six Sigma represents a level of quality