Six Sigma e-tools: An Overview of Knowledge Management Application

for Improvement Activities in Hospitality Industry

Yudha Satya Perdana

Abstract

• Six Sigma has been developed into a practical management system for

continuous business improvement.

• In 2001, Starwood became the first hospitality company to embrace Six Sigma

and began to develop a knowledge management system. Six Sigma e-Tools

Knowledge Management System (SSeKMS) was initiated as an integrated

systematic approach in managing all of information assets, including

database, documents, as well as expertise and experience for improvement

initiatives (Six Sigma Project) held by 1,081 hotel chains world wide

• SSeKMS enables each hotel property to identify improvement opportunities,

develops innovative customer focused solutions, track the bottom-line result

and transfer those innovations rapidly. This paper aims to give an overview of

knowledge Management System implementation which supports the

successive of Six Sigma adoption in hospitality industry

Introduction

• In recent days the consumers is no longer in the passive market where goods

or services are offered at the exact face value.

• The developments of recent technology have support them in providing

information about market and its competition. This has initiated new and

radical changes in the business world.

• The ability to improve and the ability to learn are the key drivers for a

company to survive in market competition

• Many organization already know the importance of process improvement

and learning organization and try to implement it, but the result is not essential

for their company. The reasons are: Lack of understanding on the level of

maturity, Process improvement not link to the strategic plan and the criteria

for success not establish, Inappropriate resource allocation, Lack of

Coordination throughout the organization, Lack of Data Management

Process Improvement and

Organization Learning

Process Improvement

Organization Learning

Reflection

Perform

Enhance Skill

• Common aspirations

• Looking for better ways

• Forward looking

• Basic team building

• Communication

• Creativity/ innovation

• Knowledge

Improved

process

• Update documentation

• Knowledge management

• Process testing

• Efficiency

• Effectiveness

• Other performance measure

Six Sigma &

Knowledge Management

• Six Sigma provides set of tools, proven methodology, and

management system to boost profitability, increase market share

and improve customer satisfaction. As a result of those, Six Sigma

eventually increases the company’s competitiveness

• Knowledge management provides strategy of putting tacit and

explicit knowledge into action by creating context, an infrastructure,

and learning cycles that enable people to find and use the

collective knowledge of the enterprises

• Knowledge management and Six Sigma share a notable distinction

in a corporate universe full of change initiatives and improvement

philosophies. These two approaches have been integrated into

regular operations at leading companies to guide and maintain the

learning cultures within organizations

Company Info

• Starwood is the world’s largest hotel and leisure (1,081 hotels) . Starwood brand include: St. Regis, Sheraton, Luxury Collection, Le Meridien, W, Aloft, Element, Bliss, Westin, and Four Points

• Before established Six Sigma in 2001, which was noted as the first hospitality company to embrace Six Sigma, Starwood already has SIS and SCE as a management improvement system. By Six Sigma, SIS and SCE have been enhanced as management system that enables associates to develop innovative customer focused solutions and transfer those innovations rapidly across an organization which known as the first hosp

• Starwood has seven divisions: Asia Pacific, Latin America, North America, Europe & Middle East (EAME), SVO, Franchise, and Corporate. Each division's Six Sigma organization reports to divisional leadership and is aligned with the division's goals and priorities

The Milestone

2001 2005 2004 2006 2007 2003 2002

The Organization Structure • Black Belt assigned to a number of Starwood

properties, who is part of a larger SIXSIGMA

project team. Black Belts are coached by a

Master Black Belt, who has regional

responsibility.

• Each property has several Green Belts with

primary role to take on the extra responsibility to

drive improvements that positively impact their

business.

• At each property, a SIXSIGMA Council meets

regularly to select and monitor projects.

• Other leadership roles include area and division

management, who are responsible for

approving projects, sharing best practices, and

coaching Master Black Belts.

DMAIC

QUICK

HIT

BEST

PRACTICE

InnovationInnovation TransferTransfer

Innovation Transfer Process

Projects that follow the DMAIC methodology led

by a Black Belt; will generally have a duration of 3-4 months and can cross functional boundaries.

Transfer project that follow iDMAIC to ensure consistent and rapid transfer of innovation

throughout Starwood. Best Practices project is identified as a transfer project when it has potential value to many other properties.

Quick Hits are small projects that can be quickly

implemented and can be completed within the boundaries of a single function or department. Quick Hits follow DMAIC method, but are not subject to as many tollgate reviews.

Six Sigma Best Practice

Six Sigma e-tool

The Six Sigma eTool application is a web-enabled, global repository of Six Sigma projects.

It is focused on data recording and houses project information from the initial project

proposal through the completed project. The eTool improves Six Sigma performance

assessment, knowledge capture, best practice transfer and senior leadership reporting.

Providing Knowledge management

Six Sigma e-Tools Knowledge

Management System

• Six Sigma e-Tool for Project Reporting and Tracking . Six Sigma e-Tool is a robust warehousing capability houses project information from the initial through the completed project. The format of the Six Sigma reports and document are standardized and regulated for projects progress and tracking

• Six Sigma e-Tool for Financial Reporting and Tracking. Six Sigma e-Tool provides financial report for leadership council. The benefit from projects can be tracked and validated. Financial benefit for Quick Hit is recorded for 12 months; DMAIC and i-DMAIC are recorded for 18 months. In the e-Tool,

• Six Sigma e-Tool for Sharing Knowledge. the implementation of Six Sigma e-Tool knowledge management system is to speed up process learning. Different with DMAIC and Quick Hit project which starts with problem or opportunity and focuses on developing and implementing a solution, a project transfer (i-DMAIC) stars with a known solution and focuses on implementing that solution to address a problem that property has in common with the exporting property

Conclusions

• Six Sigma is a proven management system for process improvement.

On the other hand, Knowledge Management (KM) is a modern

approach that deals with the greatest capital of organization.

• Six Sigma achievements are also based on proper knowledge and its

flow.

• As a systematic approach to managing knowledge and process

improvement activities with the aid of an information system in

Starwood, Six Sigma e-Tool knowledge management system has

been strongly emphasized and promoted throughout hotel chain.

• Six sigma e-Tools Knowledge Management System has played

important role in support growth, profitability and powerful tool to

speed up organization learning process to become market leader