A metric is a system or standard of measurement. The Six Sigma approach to managing business is all about helping you identify what you don’t know, emphasizing what you should know, and taking action to reduce the errors and rework that cost you time, money, opportunities, and customers.
Using Six Sigma metrics captures knowledge that is then translated into opportunities for improvement and growth.
Although you want to keep a well-rounded perspective for the metrics, Six Sigma metrics tend to measure process capability and performance. These metrics are all related to each other and focus on measuring the Big Y.
Which metric you choose will depend on the type of data you have. Some of the metrics require discrete data, and others require continuous. It’s similar to how a golfer will select a club from their golf bag based on the parameters of the shot, which usually includes the distance needed and field terrain. Most golfers will have some variation of the standard set of clubs in their bag, including drivers, irons, wedges, and putters.
Primary Metric
Primary metric is an absolute must. For any project and it should not be taken lightly. Here are a few characteristics of good primary metrics:
- Primary metrics should be tied to the problem statement
- Primary metrics should be measureable
- Primary metrics should be expressed with an equation
- Primary metrics should be aligned to business objectives
- Primary metrics should tracked at the proper frequency (hourly, daily, weekly, monthly etc.)
- Primary metrics should be expressed pictorially over time with a run chart, time series or control chart
- Primary metrics should be validated with an MSA
The primary metric is the reason for your work, it’s the success indicator and beacon for your project. The primary metric is of utmost importance and is the focus of your project BUT…not at the expense of your secondary metric.
Secondary Metric
The secondary metric is the thing you don’t want sacrificed on behalf of a primary improvement. A secondary metric is one that makes sure problems are not just “changing forms” or “moving around”. The secondary metric keeps us honest and ensures we’re not sacrificing too much for our primary metric. If your Primary Metric is a cost or speed metric then your Secondary Metric should probably be some quality measure.
Example: If you were accountable for saving energy in an office building and your primary metric was energy consumption then you could shut off all the lights and the HVAC system and save tons of energy…..except that your secondary metric(s) are probably comfort and functionality of the work environment.
Metrics focus on the following critical factors: cost, quality, and schedule. You will at times see reference to other CTx metrics, such as Critical to Safety, or Critical to Process. These Six Sigma performance metrics may be useful, or may be better classified in terms of Cost, Quality and Schedule, which serve as the root drivers for an organization.
Critical to Quality (CTQ) Metrics
There are a number of ways to measure process and operational performance. Yield is a classic measure of process performance that can be supplemented with broader measures of performance such as Throughput Yield, and Rolled Throughput Yield (for a multiple step process). While these broad measures are useful for comparing processes, such as to prioritize for improvement, they obscure the details needed for process improvement. The classic Process Capability Index can provide the detail needed for process improvement, since it requires (as a prerequisite to its use) the accompanying use of a statistical control chart to verify the process metric is stable (i.e. in statistical control). The control chart provides the analytical tool needed for process improvement by differentiating between inherent variation built into a process and changes to a process ((See Common and special causes of variation). As Deming often noted, this distinction is critical for process improvement, since the response to special causes of variation is necessarily different than the response to inherent (i.e. common cause) variation. A process capability index can also be expressed as an analogous Sigma Level or DPMO estimate. Operationally, a Sigma Level or DPMO estimate that looks across multiple processes in an attempt to show an overall defect rate for the organization is fraught with error to the point of uselessness. See also: Is Your Process Performing?
Critical to Schedule (CTS) Metrics
Critical to Schedule metrics are related to cycle time and scheduling efficiencies, including:
- Process Cycle Efficiency
- Process Velocity
- Overall Equipment Effectiveness: combines the notion of CTS and CTQ metrics.
Critical to Cost (CTC) Metrics
Six Sigma performance metrics that are determined to be Critical to Quality and Critical to Schedule are (by definition) often Critical to Cost as well. Costs associated with the process issues must include the effect of losses due to Hidden Factory and Customer impact, such as delays in shipments or in information exchange.
Metrics used in CTC evaluations, often to quantify and compare opportunities, are aligned with the key concepts of Quality Costs.
Classical measures of quality such as timeliness, accuracy, ease of doing business and cost are important and often abundant on most companies’ Six Sigma measurement framework. Other typical Six Sigma measures such as rolled-throughput yield, sigma and DPMO tell a good story, when applied properly.
