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Six Sigma - Does it fit in hospitality?

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March 01, 2008
Change | Management
Tina McCrossan - tmccrossan@crosshospitality.com

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© 2008 Hospitality Upgrade. No reproduction without written permission.

What is it about Six Sigma that creates such strong opinions, both pro and con?

Depending upon whom you talk to, Six Sigma is either the most important new direction for change management in hospitality, or it’s a waste of time that has introduced armies of green and black belts getting in the way of doing business.  Believers on both sides of the debate have a lot to say about why, in spite of this polarization, the methodology seems to be working in some organizations.

Six Sigma leads companies down some interesting paths.  You take your best people away from what they did before.  You tell them to find, quantify, fix and measure results in any aspect of the business operation which attracts their interest.  That’s a formula for organizational anxiety. However if approached correctly, Six Sigma programs don’t have to breed conflict.

In hospitality many necessary projects never get funded because of the unique capital budget challenges in the industry.  Wolfgang Ebenbichler, the former VP of F&B at the Gaylord Opryland, said, “Everyone has projects they know need to get done to achieve forecasted growth, but can’t seem to get corporate approval.  Six Sigma specialists are trained to quantify benefits and long-term effects on revenues and profitability – they can get those vital projects off the ground.” 

Often an alliance is formed between operations teams who want projects funded and Six Sigma teams who can document the necessary ROI to get them approved. However this alliance can quickly get stressed when black belts stay focused for months and even years dash boarding the results or lack thereof.

The potential for conflict is based on the underlying intuitive business management character of people in hospitality.  Experienced hospitality executives don’t need graphs and core cause analysis to know what to do.  They don’t need extensive after-the-fact analysis to know whether the effects of change were positive for the organization. Field managers are focused on hitting their numbers, making their customers happy, and following processes dictated by other departments whom they often feel don’t truly understand their business environment. Six Sigma teams can become just another department that doesn’t have a clue.

Negative perceptions as well fuel potential for conflict.  Poor approaches to Six Sigma in some companies have created powerful elitist organizations that create hierarchy not conducive to utilizing all levels of talent in the company.

Six Sigma is a methodology that seeks to understand the causes and effects of quality breakdowns.  Six Sigma teams are taught to use techniques and tools to evaluate and determine change value, which is then measured against change cost.  But for the sake of the rest of us, let’s make it simpler.  It’s a suggestion box program.  Years ago before the days of e-mails and blogs, HR departments put out suggestion boxes for anyone in the company and even customers to bring forth ideas on how things could be changed for the better.  Six Sigma is a philosophy and methodology for prioritizing, cultivating and processing those suggestions.

Six Sigma does have a fit in hospitality as evidenced by success at companies like Intrawest.  With the right approach to Six Sigma you can dramatically improve your organization’s ability to take advantage of the corporate suggestion box.  Six Sigma teams are resources that can process those ideas, identify which make sense, and bring them to life.  A good Six Sigma program (or any name you give it) can yield significant top and bottom line impact. 

If you already practice Six Sigma and it’s not fun for those inside or working with your Six Sigma team, you are potentially on the wrong path.  Your initial approach was likely wrong.  Your Six Sigma team may have warped into an audit organization.  It is fixable.  With facilitation, structural adjustments and redefinition of the mission you can get back on track to a world-class change management process.

And if you worry that Six Sigma may be too complex for your organization, take note of Sandestin Resort's F&B Director Bill Merlyn’s view of the program. “Six Sigma is really pretty easy.  But it is a passion.  It’s now part of my life,” Merlyn said.  “One of my early Six Sigma projects was my bedroom closet, and even though my family thinks I’m nuts, things run much more smoothly at our house now.”

The good news for Intrawest is that things run pretty smoothly at Sandestin as well.

Tina McCrossan is the CEO of Cross Hospitality. She can be reached at tmccrossan@crosshospitality.com.

Six Sigma: Example 1
When Intrawest started its Six Sigma program the word went out for volunteers.  Volunteering meant you left your job for a two-year assignment with no guarantee of returning to your position.  There was no salary change nor was there any incremental bonus tied to results achieved. 

F&B Director at Sandestin Resort Bill Merlyn leaped at the opportunity and ultimately became a black belt.  “At Intrawest Six Sigma is fun,” Merlyn said. “Teams at many different properties come up with ideas, quantify the change in terms of impact, make the change and track the results.  When a successful Six Sigma project at one property gets published, there’s no mandate to adopt it. Most property teams take change ideas and evolve them. The process of change is competitive, but it’s fun. Decisions on what to do or not do are still made by the operating executives, we just help them make better decisions and then make sure the decisions produce the desired result.”
Six Sigma: Example 2
Formerly the vice president of F&B at the Opryland Gaylord Resort, Wolfgang Ebenbichler was introduced to Six Sigma in a previous company where he earned his green belt certification.  “The hospitality industry is a small community and negative experiences are shared and travel quickly,” Ebenbichler said.  “In our complex management structure I needed for everyone to stay positive, so I changed the name of our program to ‘Zero Defect Targets’ in an effort to avoid the negative perceptions.  We’ve had great success using Six Sigma principles improving profitability, table-turn times, kitchen labor efficiency and server’s upsell productivity.

"When Six Sigma teams are first established there is a lot of power implied and granted. The key to a Six Sigma team’s success is resisting the temptation to force change as opposed to encouraging and cultivating it.  Six Sigma can never be successful if it is not owned, maintained and used by the individual department heads.  If there is a feeling of Big Brother it will be resisted at every opportunity.  The key is to extrapolate the key performance indicators (KPIs) of the processes and show the chefs and department heads the value of the data.  This helps them to adapt these KPIs into their repertoire of performance monitoring tools and appreciate their value. That takes a lot of patience and some selling initially, and with the help of IT, many of the time-consuming, manual aspects of Six Sigma projects can be automated.”

Keys To Six Sigma Success

>> How you create your Six Sigma team is critical.  Focus on creating a passionate commitment to being the suggestion box response team.

>> Recognize that in hospitality the goal will rarely be achieving technical Six Sigma levels. You likely operate today at a one or two sigma quality level and just getting to three will make a tremendous difference.

>> Recognize that it doesn’t matter what the program is called, a shift to having a focused team documenting project potential and tracking ROI results will yield the following:

  • Projects that look to be worthy may be proven not to be.
  • Projects will start to become subtractive as opposed to additive to standard operational procedures. Some of the best Six Sigma territory is looking at what you do today, and deciding that some activities may or may not need to continue.
  • Projects that are executed will more likely achieve business impact goals, but there will be accountability and focus on proving and verifying results achieved.
  • New technology projects will be radically different.  It will no longer be, lets produce a list of what everyone wants and go out with an 80-page RFP. You’ll be focused on critical functionality that is directly linked to the ROI being projected.

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