Six Sigma in the Contact Center

Northwest Call Center Professionals

Help Desk Northwest
May 17, 2006

Mike Stone
 Agenda

• Introduction to Six Sigma

• Full Life-Cycle Case Study

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 Introduction

Six Sigma was invented by Motorola, Inc. in

1986 as a metric for measuring defects and
improving quality. Since then, it has evolved to
a robust business improvement methodology
that focuses an organization on customer
requirements, process alignment, analytical
rigor and timely execution.

http://www.motorola.com/content/0,,3074-5804,00.html
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 Six Sigma, the GE Way
• Six Sigma - A vision of quality which equates with only
3.4 defects per million opportunities for each product or
service transaction. Strives for perfection.
• DFSS – (Design for Six Sigma) is a systematic
methodology utilizing tools, training and measurements
to enable us to design products and processes that meet
customer expectations and can be produced at Six
Sigma quality levels. (DMADV - Define, Measure,
Analyze, Design, Verify)
• DMAIC – (Define, Measure, Analyze, Improve and
Control) is a process for continued improvement. It is
systematic, scientific and fact based. This closed-loop
process eliminates unproductive steps, often focuses on
new measurements, and applies technology for
improvement.
Source: http://www.ge.com/sixsigma/glossary.html
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 Other Quality Systems
• Total Quality Management (TQM)
• Toyota Production System (TPS)
• Kaizen
• Lean
• Theory of Constraints
• Agile
• PDCA – Plan, Do, Check, Act
• Good Manufacturing Process – Pharma
• ISO 9000

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 Key Concepts
• A process is all the activities involved in
producing a product or service for a customer. It
is cross-functional in nature
• Quality is defined by customer requirements for
the chosen process
• Defects are defined and counted
• Inconsistencies in the process, known as
variation, are studied
• Causes of variation are identified and addressed
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 Key Terminology
Critical to Quality Attributes most important to the customer

Defect Failing to deliver what the customer wants

Opportunity Event where success or failure can be determined
Process Level of quality your process can deliver
Capability
X Underlying factors that affect Ys
Y Measures being addressed by the project

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 Key Terminology
Variation What the customer sees and feels
Stable Operations Ensuring consistent, predictable processes to
improve what the customer sees and feels
Common Cause A source of failure that is always present as part of
of Variation the random variation inherent in the process
Special Cause of A source of failure that lies outside the Process, and
Variation so is intermittent, unpredictable, unstable

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 DMAIC
Define Measure Analyze Improve Control

Team Chartering
Customer Focus
Process Mapping
Measurement
Variation
Data Collection
Data Analysis
Process Analysis and Focus
Root Cause Analysis
Quantify Opportunity
Generate Solutions
Select Solutions
Implementation Planning
Monitor the Process
Documentation
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 Case Study

IT services business
Customer service call center

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 Project Selection
• Business strategy
– How important is customer satisfaction?
– How important is it to attract new customers?
• Competitive position
– How do we compare to our competitors?
– Benchmarking
• Best projects
– Issue is well-defined with supporting data
– Scope is well-defined
– Objectives are stated in business terms and are
measurable

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 Project Selection
• Customer satisfaction
– Average
– Lower than best-in-class in industry
• Positive correlation with account growth
– Customer satisfaction and new accounts are statistically
related to one another
– Business judgment
• No correlation with customer service spending
– Per call costs were not higher at strong competitors
• Goals: Reduce support costs while improving new
account growth

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 Define
• Team Chartering
– Goal statement: "Increase the call center's industry-
measured customer satisfaction rating from its
current-level (90th percentile = 75 percent) to the
target level (90th percentile = 85 percent) by end of
the fourth-quarter without increasing support costs.“
– Milestones, tasks, responsibilities, schedule and
communication plan.

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 Define
• Customer Focus
– SIPOC diagram – identify customers (stakeholders)
• Customers
• Staff
• Business
– Voice of the Customer interviews
• "What influences your level of satisfaction with our services?"
– Summarize customer requirements
• Identify measures for each requirement
• Next slide

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 Define

Requirement Measure (CTQ)

Quickly connect with a helpful Wait Time
person
Get the information I need Transfers; Service Time
Apply the information, with help if Customer Satisfaction,
needed Support Cost
Understand how to avoid problems Days to Close
recurring

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 Define
• Process mapping
– Helpful during the Measure phase, as the project
team considers how and where to gather data that will
shed light on the root cause of the issues most
pertinent to the project's goals.

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 Measure
• Define measures and how the data will be
gathered
• Example:
– Customer Satisfaction
• By industry standard monthly survey
• The project will require additional, more frequent, case-by-
case customer-satisfaction data. A measurement system that
tracks with the industry survey will be devised and validated.

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 Measure
• Define performance standards
• Example:
– Customer Satisfaction
• Current Baseline
– 90th Percentile / 70-80% Satisfied
• Performance Target
– 90th Percentile / 85% Satisfied

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 Measure
• Identify segmentation factors for data
collection plan
– Focus data collection effort
– Use cause-and-effect tools
– How is Y naturally segmented?
• Call center, product type?
– What factors may be driving the Ys?
• Take a guess at what your important Xs might be
• Call type, customer type?
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 Measure
• Assess measurement system
– Accuracy
• Does the measure agree with the “truth”?
– Repeatability
• Does the system always produce the same value?
– Reproducibility
• Will different people get the same results?
– Stability
• Is the system accurate over time?
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 Measure
• Collect the data
– Automated
– Manual
– New metrics may be needed
• Display the data
– Look for clues into causes of variation
– Simple charts and graphs

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 Analyze
• Measure process capability
– Compare current performance to standards
• Refine improvement goals
– Adjust goals if data shows departure from
expectations
• Segment data
– Slice and dice data to look for patterns to find
causes of variation

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 Analyze
• Identify possible Xs
– “Likely suspect” causes of variation
• Identify and verify the critical Xs
– Narrow down to most important causes of variation
– Why do Problems and Changes cost more than other
call types?
– Why are calls processed on Mondays and Fridays
more expensive?
– Why do transfer rates differ by call type? (higher on
Problems and Changes, lower on others)
– Why are wait times higher on Mondays and Fridays
and on Week 13 of each quarter?
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 Analyze
• Refine the benefit forecast
– Update the forecast of how much improvement can
be expected
– Found that key support cost drivers (the delays and
interruptions during call-servicing) were the same as
those known to drive down customer satisfaction – so
a win-win seemed to be possible.

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 Improve
Identify Solution Alternatives

Driving Xs Solution Alternatives

Staffing •Add staff Mondays and Fridays, reduce staff on
Sundays
•Develop staffing model
•Create on-call list to fill-in for absentees
Web Service Percentage •Focus on services that can be done best on the
Web
•Define and communicate the value prop to
customers
•Evaluate incentives to move traffic to the Web
Transfers and Callbacks •Improve call center processes to reduce transfers
and callbacks without impacting customer
satisfaction
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 Improve
• Verify the Relationships Between Xs and
Ys
– Solution Selection Matrix
• Solution Alternatives
• Customer Requirements (CTQs)
– Regression Analysis
• Determine the strength of each solution against the
CTQs

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 Improve
• Select and Tune the Solution
• Details of the plan for the Monday staffing pilot
program:
– Xs to adjust: Staffing level (add five for pilot, full
increment to wait for evidence plan works)
– Ys to measure for impact and unintended side effects:
• Wait time, v/s ratio, customer satisfaction,
transfers, callbacks, service time.
• Compare "new staff" versus "old staff" (hypothesis
test).
• Measure monthly to observe learning curve effect,
if any
(continued on next page)
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 Improve
• Details of the plan for the Monday staffing pilot
program:
– Measurement system issues: Revise existing
sampling plan and data collection process to
distinguish new staff from old staff.
– Because the current customer satisfaction sampling
gives only 1 data point per month (not enough to see
a change), arrange a special sample – five per day for
the first 60 days of the pilot (80 percent from existing
staff, 20 percent from new staff).
– People and logistics issues: Communicate what is
happening and why. Emphasize evaluation is not of
individuals, only overall impact.

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 Improve
• Implement Solution
– Pilot, if possible
• Collect data during pilot
– Xs and Ys
– Watch for unintended impacts
• Report out and obtain approval for full
implementation

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 Control
• Develop Control Plan
– Management control dashboards – Ys
– Operational control indicators – Xs
• Determine Improved Process Capability
– Business Growth
– Customer Satisfaction
– Support Cost per Call
– Days to Close
– Wait Time
– Transfers
– Service Time

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 Control
• Implement Process Control
– Ongoing data collection and presentation
• Close Project
– Roll out process changes
• Training
• Transition control to management
• Validate results
• Refinements
– Project post mortem
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 Tools

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 Tools
• ANOVA
ANalysis Of VAriance (ANOVA), a calculation procedure
to allocate the amount of variation in a process and
determine if it is significant or is caused by random
noise.

• Cause and Effect Diagram

A cause and effect diagram is a visual tool used to
logically organize possible causes for a specific problem
or effect by graphically displaying them in increasing
detail. It helps to identify root causes and ensures
common understanding of the causes. It is also called an
Ishikawa diagram.
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 Tools
• Control Chart

A graphical tool for monitoring changes that occur within

a process, by distinguishing variation that is inherent in
the process (common cause) from variation that yield a
change to the process (special cause).

• Kano Analysis

Kano analysis is a quality measurement tool used to prioritize

customer requirements based on their impact to customer
satisfaction.

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 Tools
• Pareto

The Pareto principle states that 80% of the impact of the

problem will show up in 20% of the causes. A bar chart
that displays by frequency, in descending order, the
most important defects.

• Run Chart
A performance measure of a process over a specified
period of time used to identify trends or patterns.

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 Tools
• X-Bar and R Charts

This set of two charts is the most commonly used

statistical process control procedure. Used to monitor
process behavior and outcome overtime.

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 Resources
• http://www.isixsigma.com/
• http://www.sixsigmainstitute.com/
• http://www.motorola.com/motorolauniversity
• http://www.ge.com/sixsigma/

• The Six Sigma Way: How GE, Motorola, and Other Top Companies
are Honing Their Performance by Peter S. Pande, Robert P. Neuman,
Roland R. Cavanagh
• Fourth Generation Management by Brian L. Joiner
• Leading Six Sigma by Ronald D. Snee and Roger W. Hoerl
• The Pocket Idiot’s Guide to Six Sigma by Marsha Shapiro and
Anthony Weeks

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Six Sigma in the Contact Center

Mike Stone
Mobile: (206) 779-3105
mgstone2020@yahoo.com