Defining Processes Using a SIPOC Diagram

In seeking to reduce waste, create greater efficiencies, and improve the value-benefit delivered to the customer, everything must begin by defining the process. Or, if one already exists, the task at hand is to enhance the process it to make it more useful.

To accomplish this, a helpful tool called a SIPOC can be used. This is a visual diagram which is useful in capturing the process accurately. Because it lays out all the essential components of a process in a single visual, the SIPOC ensures that all the pertinent aspects which should be included are right there in black and white.

As in all applications of Lean, a paramount goal of defining a process is including provisions to encourage continuous improvement. Doing so from the get-go will make certain that greater efficiencies can be achieved and the value-benefit goals continue to reach higher. Non-value added steps will be identified and removed, opportunities for introducing efficiencies will emerge, and defects will be reduced, and hopefully, eliminated entirely.

Pronounced sigh-pock, SIPOC, it’s an acronym for: Suppliers, Inputs, Process, Outputs, Customers. Also called a ‘high level process map’, SIPOC is designed to provide a broad-bush overview and is not intended to drill down into great detail. That will come later.

*Click on the photo below to expand the SIPOC diagram. 

The intrinsic value of the SIPOC diagram is that it rallies all stakeholders into focusing intently on the process in question. Unnecessary distractions melt away once everyone is engaged in having to describe a process in a clearly defined manner.

As an integral part of the Six Sigma data and statistical approach, SIPOC is widely accepted as the best framework to employ during the defining phase of the DMAIC (Define, Measure, Analyze, Improve, Control) methodology. For a quick refresher on the topic, you can refer back to our previous article Moving forward with Lean and Attivo-All-In-One.

SIPOC in action

When engaging with a new client, the Attivo Lean specialists begin by interviewing the leadership of the business. Our first goal is to understand the processes in place and how they intersect with each other in the organization. Hearing stakeholders describe pain points they are already aware of provides us with clues for ferreting out further inefficiencies which are almost certainly causing waste and preventing continuous improvement.

It’s very common to find organizations which lack clear outlines for processes, even when they are central to mission critical activities. When processes are not defined and clearly mapped, stakeholders have a poor understanding of which steps have been completed and when value is transmitted. Without each team member owning personal accountability for a process, inefficiencies go unnoticed and unaddressed.

Understandably, a lack of standardization of tasks goes hand-in-hand with this environment. Over time, this can result in an out of control process, resulting in a lower quality of outputs.

Any organization that is ill-equipped to ensure quality is consistently delivered to the customer is running the risk of losing their business to a competitor who can meet the needs of the customer with better value-benefit capabilities.

By using the SIPOC diagram we make this exercise of defining process after process, throughout the operation relatively quick and easy

to perform. Quite simply, it gets everyone on the same page and quickly speaking the same language. To drive home the value of completing the diagram, we explain the immediate and longer term benefits it delivers:

  • Increases transparency of the organization’s operations
  • Serves as a definitive road map and overview of processes
  • Accelerates training of new hires and refresher for existing employees
  • Supports problem solving initiatives, now and into the future
  • Provides a valuable template for other processes elsewhere in the organization
  • Builds esprit des corps by making shared objectives understandable

Once in play, the SIPOC diagram helps ensure a process stays in control. If a process is out of control, then it will yield various outputs which will most likely not satisfy the needs of the customer.

SIPOC for seeing the big picture

In addition to defining our Suppliers, Inputs, Process, Outputs, and Customers in the diagram, we also must expose any issues or errors which are occurring in the process. Once again, the SIPOC becomes the go-to document by helping highlight where and how these issues are occurring. At this point we also take into account Critical to Quality (CTQ) characteristics, such as Cost, Process, Safety, and Delivery. These are the key metrics which reflect process requirements.

A we generate a new SIPOC for each process in use, or for defining new processes, managers and team members begin to recognize the value lost with current procedures. That is the point of the SIPOC diagram:

  • Highlight a process and define it conclusively
  • Track inputs and outputs throughout process steps
  • Assess the effectiveness through Critical to Quality (CTQ) metrics
  • Measure value and track it throughout the process
  • Identify problems and eliminate where value is being lost
  • Harness newly gained transparency to increase safety and quality

So, how do you determine if SIPOC will benefit your organization? It’s common for management teams to adopt homegrown strategies in an attempt to document the processes they have in use or even to rein in out of control processes. Examples of these coping mechanisms are excessive documentation for describing processes and voluminous training procedures for employees tasked with executing processes.

Taking a hard look at how your operations are managed and whether they are in any way aligned with Lean and Six Sigma practices may be useful in determining if now is the time to consider a customized MRP solution. As we’ve described in our Lean series of articles, Attivo All-In-One, powered by SAP Business One, is the ideal solution for taming out of control processes, standardizing manual tracking and reporting, and eradicating inefficiencies which are holding you back from growth and profitability.

Regardless of the challenges you face in supply chain, sales management, accounting, and quality assurance, our Lean specialists have the experience and know-how to improve your operations, increase efficiencies and inventory turns, reduce manufacturing lead-time, and streamline customer service.

Attivo All-In-One, powered by SAP Business One has the most powerful and fully integrated analytic and reporting tools in the ERP software sector for small to mid-sized businesses. This makes it easier and more efficient to design and implement customized quality control processes and methods across your organization.