While the Six Sigma system might have been born of a need in the manufacturing industry, it has shown enough flexibility to be implemented in a variety of sectors. This includes service environments, such as financial institutions, hospitality companies, healthcare providers, retail businesses, and insurance brokers.

The Six Sigma model has applications and advantages for many industries, although the approach might vary slightly. However, the core principles of Six Sigma can find a place they can call home in any service sector imaginable.

Challenges in the service sector

Doing a root cause analysis of a service organization reveals that it faces similar problems to those experienced in the manufacturing industry. The process management model has several solutions to offer.

Waste is common in many service industry businesses. Whether it’s food at a restaurant or employee productivity at a healthcare institution, there are ways that Six Sigma can help. Often, this wastage is the result of inefficient processes. In the long-term, this waste can take a significant bite out of a company’s bottom line.

Another challenge is providing quality service. After all, the service industry is driven by people and getting them what they want or need. The customer is king, and every effort must be made to keep them satisfied to ensure repeat patronage of the company. 

Most decisions are made by people while they are under pressure, and the human element can often have an impact on efficiency and quality of service. The modification of human behavior is one of the focal points of Six Sigma, even when it has been entrenched into the organizational culture over some time.

What does Six Sigma offer the service sector manager?

As with any environment, the problems and needs are unique, requiring the application of tools and methodologies to suit the context. 

For this reason, thorough studies into the processes and contextual factors within the business are necessary before making recommendations and trying to make changes. Here are the three areas where a significant shift is possible:

Waste elimination

Peter Peterka, a successful Six Sigma proponent, believes that waste elimination should be the first priority in the service sector. There are lean, statistical tools that can be applied after a thorough root cause analysis to determine where the waste is coming from. Once they are implemented, waste is immediately reduced, if not eliminated.

Altering mindsets

The modification of employee behavior is a complex issue, and as challenging as a manufacturing environment. An analysis of practices, decision-making processes, and cycle times yields valuable information. 

Six Sigma helps to introduce a standardization of processes, making it easier for the company to offer consistent and reliable services to its customers.

Organizational culture shift

Initial resistance is to be expected, with workers complaining that the system is working just fine, and there’s no need to tamper with it. Being at the coalface of the business doesn’t allow them to see the bigger picture. 

It makes it hard to persuade them to abandon the way they’ve been doing things for many years. Once the use of Six Sigma demonstrates to them the chances for improvement, their buy-in will follow.

A holistic approach

Companies have tried and abandoned many business process models. When looking at the reasons for this, it is clear that it happened because the model was task-focused. 

Six Sigma is a process-driven approach, so it does an organizational overhaul, instead of making changes here and there. Working on the entire organization makes it possible to improve the company’s transactional processes, increase customer satisfaction, increase profits, and reduce costs and waste.