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  • #37322

    Pai
    Participant

    Hi,
    I am a Black Belt. I have come across with a problem, where company is almost new entrant to the market for a specific product/service and aims to improve its market share for that product/service.
    Company is having a very limited data available as it is a new entrant.
    For this kind of problem, which tool is suitable (DFSS or DMAIC)?.
    Any such projects are available to share?
    Thanks 

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    #110070

    Deanb
    Participant

    I faced this very problem for the first time about 12 yrs ago as a VP of Marketing and Development. Since I was dealing with limited data, and even more importantly, limited ntelligence and market position, I first need the marketing 4-P’s (expert matching of product, price, place and promotion) to generate sales, any sales (not perfect sales), because you know the old adage: “nothing happens without a sale happening first.”
    Second, after some initial sales were on the books, I found Anova and DOE’s ability to work with limited data quite a virtue. I used small data samples to analyze variations in operating cost behavior, variations between estimated cost and actual cost, and highly obvious low hanging fruit issues in general using teams, data, and client input. This lead to an all out effort to more accurately define estimating cost standards, to set up initial vendor alliances where needed (initiating some repeatability), and basic internal prevention procedures using. It also helped us better target clients and scopes that better fit our cost strengths and comparative advantages improving both out hit rates and financial performance (notice the 360 degree play here). 
    Org structure is also a factor in new product venture. To facilitate flexibility and rapid adaptations and improvements we borrowed a lesson from the marketing profession and structured ourselves as a “Product Team.” The initial sales were financial dogs, but we learned and prevented at a fast pace (the key to venture success)resulting in rapid increases in sales volume that were sustainable by normal marketng efforts. The concept of creating a learning organization fits this situation perfectly.
    Since then I have applied these approaches several times successfully, so I know it works and is repeatable. You are still using the funnel approach, as in six-sigma, but adapting heavily to marketing realities. We did not call this six-sigma then. It was called it TQM by some, Marketing or Product Management by others. My biggest lesson from it was you have to fit the improvement methods and org structure to the nature of the situation. In marketing the goal of quality is not to make the marketing function defect free, but to enable it to function effectively and predictably with normal effort.
    Good luck Rajesh.

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    #110166

    Pai
    Participant

    Thanks Dean.
    But most people opinion on applying six sigma in market improvement is -ve, they think that its just marketing strategy, six sigma will not help.
    If you have some case study on this topic. Please forward.
    Thanks

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    #110251

    Deanb
    Participant

    Rajesh,
    As I mentioned previously, I found some six-sigma tools (DOE and ANOVA) to be quite useful in the support of market development strategies, especially in identifying internal performance relationships.
    For example, in one study we discovered that our material handling costs were lower when customers furnished material, rather when we purchased and controlled it, debunking an internal myth that our material control system was saving us money. It wasn’t. It was worse than just having vendors dropping material on the shop floor without any management at all. We found our material control system’s lack of capability was severely impacting the productivity of our highest skilled workers. This opened many eyes, and resulted in several more detailed studies and corrective actions which did use more of the traditional six-sigma tools. It also resulted in the near-term forging of some key vendor alliances whose material delivery systems were “lowest cost” to our handling process.
    Another example: we discovered we were winning a higher percentage of one size range of product. Our myth was we believed we just were “good” at this, that it was our market “sweet spot.” After doing a couple of DOE’s we learned our cost standards were way off on these sizes, making us too cheap, hence distorting the marketplace, causing us to win more losers and lose more winners. Our financial prospects improved significantly upon discovering this anomoly, but the improvent journey was challenging. It resulted in a completely different bundle of project priorities than we had planned previously. Truth has a way of spoiling the best plans.
    Six-sigma as a zero defect strategy may not be as relevant in market development as it is in production operations. However, its tools and funnel decision support approach can be applied creatively to accelerate the marketing strategy learning and adaptation process, which can help ID critical priorities. You have to adapt six-sigma to support this application. Out of the box your colleagues are correct: it does not fit well.
    Good luck.

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