Motorola, Inc., in 1986, developed a unique approach to quality control, and the multinational telecommunications company dubbed it the Six Sigma methodology.
Later in 1995, Jack Welch, the then CEO of General Electric, popularized the Six Sigma approach, making it an integral component of GE’s global business strategy.
The innovative Six Sigma method incorporates data-driven, statistics-based tools and techniques designed to facilitate lean manufacturing, better process management, and continuous improvement.
The SIPOC model is a part of the Six Sigma methodology. It is one of the most trusted and oldest techniques to map critical business processes.
The SIPOC model allows organizations to document their business processes graphically, providing them with a comprehensive view of all key process elements in the form of tables and charts.
What Is a SIPOC Model?
Specifically, SIPOC stands for Suppliers, Inputs, Processes, Outputs, and Customers. In practical terms, SIPOC is a method for describing and improving processes by summarizing the inputs and outputs of one or more processes.
The Six Sigma methodology includes various stages, for instance, Define, Measure, Analyze, Improve, and Control. The short for Define [D], Measure [M], Analyze [A], Improve [I], and Control [C] is DMAIC. It is referred to as Six Sigma DMAIC.
Process management teams implement the SIPOC model during the ‘Measure’ stage of Six Sigma DMAIC, to determine relevant factors of process improvements before the work on a project starts.
The SIPOC model prompts teams to take into consideration crucial process elements, such as the suppliers [S] of the process, the necessary inputs [I] to the process, the different functions of the process [P], the expected outputs [O] from the process, and the customer [C] or the end-user, who receives the process outputs.
A visual tool, SIPOC helps understand the entire process, from its start to the end. It offers valuable insights into areas where major issues persist. Problems can arise from the supplier’s end; they can be associated with input specifications or can be connected to processes and outputs not meeting customer requirements.
A SIPOC table, or a SIPOC diagram, presents an excellent opportunity for teams, the higher management, and all stakeholders to troubleshoot process-related issues, and accordingly, develop appropriate strategies for improvements.
Key Components of the SIPOC Model
Companies in the service industry usually follow the C [Customer] - O [Outputs] - P [Process] - I [Inputs] - S [Suppliers] approach. In the COPIS methodology, ‘Customers’ come first, and then, ‘Outputs’, ‘Process’, ‘Inputs’, and ‘Suppliers’.
This is because in the service sector, for example, restaurants, customers place their requirements first, and then they get the output (food), which gets facilitated by ‘Process’, ‘Inputs’, and ‘Suppliers’.
The manufacturing industry also implements the SIPOC model, but most organizations apply the P [Process] - O [Outputs] - C [Customers] - I [Inputs] - S [Suppliers] method. In the POCIS approach, ‘Process’ and ‘Outputs’ are the first two steps that generate requirements for ‘Customers’, supported by ‘Inputs’ and ‘Suppliers’.
Regardless of the mode of application, the key components of the SIPOC model - S [Suppliers] - I [Inputs] - P [Process] - O [Outputs] - C [Customers] - remain the same.
SIPOC Model Example
To prepare a SIPOC table, process teams must be capable of mapping the entire operation. They must be able to identify different elements of the process, including who the suppliers are, the inputs required for process execution, the final output, and the customer.
Here’s a simple SIPOC model example of a vehicle repair facility:
Repair kit suppliers
Spare parts suppliers
Original Equipment Manufacturer
The vehicle owner
Requisition for repair
The vehicle for repair
Work order to proceed
Approved parts for repairs
Spare parts sourcing
Service completion notification
Delivery time and date
Text message / email / Telephone to inform the customer
The vehicle owner
When the SIPOC diagram is ready, process management teams should share it with all stakeholders for evaluation, rectification, and process improvements.
Why Do We Need the SIPOC Model?
The SIPOC model is key to business process improvements.
By graphically representing all elements of a process, it keeps everyone onboard, including new employees, informed about the different stages of a process.
The SIPOC model also helps determine variations in KPOV (Key Process Output Variable), which is a factor that results as an output from a process.
KPOV variations can have a tremendous impact on manufacturability, performance, reliability, and efficiency. Tracing and correcting the variations will lead to seamless process integration, improvements, and optimization.
How Does the SIPOC Model Help in Process Improvement?
The SIPOC model offers a clear picture of the complete process, and the follow-up steps.
It enables process management teams to visualize, comprehend, and communicate effectively.
With in-depth knowledge of the underlying causes of problems, organizations can develop practical strategies to improve processes.
The SIPOC model allows teams to figure out how S [Suppliers], I [Inputs], and P [Process] are impacting O [Outputs] and C [Customer] needs.
Actionable insights into factors that are affecting customers create significant improvement opportunities.
The Benefits of SIPOC
There are innumerable benefits of SIPOC.
The SIPOC model can be beneficial in many ways, especially in dealing with challenges and solving problems within business processes.
Enhanced problem-solving capabilities lead to more informed and improved process management.
SIPOC diagrams provide a comprehensible overview of processes, making sure all stakeholders are on the same page. In addition, the SIPOC model is the cornerstone of Six Sigma DMAIC methodology, when DMAIC is in the "Define" and "Measure" stages.
This optimizes business processes, improves efficiency, and boosts revenue while cutting down on operating costs.
Why Consider Getting a Six Sigma Certification?
Organizations around the world acknowledge Six Sigma-certified individuals as trained professionals with the expertise, training, and knowledge to simplify business processes, minimize costs, and improve the return on investment.
According to the Quality Progress' annual Salary Survey, multinational companies are looking for professionals with Six Sigma certification in high-paying positions to achieve business goals, enhance profitability, and optimize process efficiency.
The results of the 2019 Quality Progress Salary Survey show that professionals in the United States, with any level of Six Sigma training, earn on average USD 17,205 more than those without Six Sigma certification.
There are four types of Six Sigma certifications, which include certified Master Black Belt, certified Black Belt, certified Green Belt, and certified Yellow Belt.
A Six Sigma Green Belt certification from a world-class educational institution, such as Simplilearn, is an ideal choice for beginners and professionals seeking a smooth career transition.
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