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Holding Black Belts Accountable for Positive Project Results

As a Black Belt, I know it is easy to fall into the trap of working only on projects that cut costs. I also know that this type of “accounting” is a slippery slope that can cloud essential business goals by creating unfounded visions of savings. Don’t get me wrong – cutting expenses is important….

Five Ways to Measure Six Sigma Financial Benefits

By Jeffry J. Smith How can practitioners create a rigorous accounting method for measuring the financial benefits from their Six Sigma projects? The key here is being able to translate measured operational benefits into dollars, either in the form of cost reduction, inventory reduction or a revenue increase. The following five areas should be measured…

Patient Puzzler: Out-Of-Control Patient Collections

Ms. Collette D’Bills, patient accounting, has gathered data related to accounts receivable, entering it to an Excel spreadsheet. In fact, she has several years’ worth of data in her Excel files, but has not been able to understand what it means, except to see that accounts receivable sometimes go up and sometimes go down. At…

Software and IT Measurement Systems: Effort Accounting

Effort accounting is needed in software and IT for the simple reason that labor is generally the most important controllable element of cost. Labor cost (effort hours times prevailing labor rate) is an essential and fundamental element of efficiency measurement. Six Sigma projects in software and IT (especially DMAICs) are often focused on driving down…