Bharti Broadband makes huge savings by adopting Six Sigma

To provide customers high uptime and deliver error-free services, Bharti Broadband has embarked on a Six Sigma quality initiative. Shipra Arora has the details on this process improvement implementation

Bharti Broadband Networks (BBNL) is one of the leading integrated broadband service providers in India. It operates in the broadband, Internet and VSAT markets. This data and broadband company provides customised and integrated solutions to corporate customers using a combination of terrestrial, VSAT and Internet solutions. As of date, the company has a total of around 1,000 corporate customers. The services it sells on the network require high uptime. As a result, customer expectations in terms of uptime and redundancy are very high. Meeting their expectations required to deliver error-free services. The company is now working in this direction through its Six Sigma initiative.

Ashok Juneja says that BBNL realised that the telecom industry was undergoing rapid change and so were customer requirements, and Six Sigma met the requirements of this changing environment

Requirements

The ‘customer is king’ adage defined the key requirements for BBNL. It was essentially faced with the need to improve customer satisfaction, reduce cycle time and defects to derive cost savings, improve opportunities to retain customers, capture new markets and build a reputation for top performing products and services. The company wanted to set benchmarks in its key customer interfacing areas like reducing complaints, reducing time-to-connect to customers, improving network quality, delivering high standard products and services to its customers. With these outlined requirements in mind, the company arrived at its quality objective. The aim is to deliver error-free services to customers by doing the job right the first time, every time.

Why Six Sigma?

With the quality objective having been decided in March this year, an executive committee (EC) comprising nine officials, including the CEO, was formed. The task was to align the quality objective with the right solution or the right quality tool. The committee studied various other quality tools and processes like ISO and TQM in addition to Six Sigma. The choice for Six Sigma was made as it was closely aligned with the outlined quality objective. According to Ashok Juneja, CEO, BBNL, Six Sigma was suitable for BBNL’s work environment. "We realised that the telecom industry is undergoing rapid change and so are customer requirements. Six Sigma met the requirements of this changing environment." There were already several case studies of successful Six Sigma implementations in large companies like GE, Motorola, Wipro, TCS and Satyam, besides many others.

Since the focus for BBNL was primarily on customer satisfaction, the customer focus of Six Sigma attracted the company. Six Sigma says ‘Customer First’ and the processes in the organisation should help meet the customers’ requirements. It helps design robust processes to that effect. Some of the other key features that helped BBNL decide in favour of Six Sigma were that it is based on milestones, encompasses manufacturing, software and transactional processes, removes defects from products and services, provides sustainable competitive edge and also has global acceptance. It also integrates well with other quality initiatives, which was important considering the company already had the Phil Crosby quality methodology in place. The company is now applying the Six Sigma tool on Phil Crosby methodology for continuous improvement.

Project selection exercise

Having decided upon IGE as the consultant, the Six Sigma initiative was formally launched in June 2003 with the tagline: ‘Six Sigma—my customer, my priority’. The company has outlined that improving customer satisfaction is the business objective for first year of the initiative. The executive committee identified the various processes that were in conjunction with the year’s focus area. Since Six Sigma is a project-based tool, process improvement exercises were divided into various projects. In the month of July, three days were spent on the project selection exercise in which 108 projects were identified to be undertaken in phases. Presently the first phase is underway, comprising around 50-60 projects. This phase is slotted for completion by December 2003 when the second phase
will be initiated.

According to Juneja, in the first phase, critical business processes have been aligned with business objectives. The critical objectives identified are customer satisfaction, employee satisfaction, improving revenue and free cash. First, the projects with processes mapped against these objectives were to be undertaken. And then the quality improvement projects for existing and new products were to be undertaken. Almost 85 percent of Six Sigma projects at BBNL are based on customer satisfaction.

Team formation

Under each project a cross-functional team has been formed. The team comprises a sponsor, a leader and four to five team members. The leader, also called the ‘Champion’ can be either a Green Belt or Black Belt. The duration for each project can range between three to four months. For the first phase the team has chosen 15 critical projects, which will have substantial gains. Juneja informs that presently the company has a pool of around 5 Black Belts, who are involved full-time in the quality improvement process and around 50 Green Belts, who spend around 8-10 percent of time on quality improvement. A Black Belt can be engaged in two to three different projects simultaneously.

Methodology

Each of the projects follows a five-phase methodology, says Juneja. These include defining and quantifying the problem, measuring the defect rate, i.e. the baseline. This is followed by the analysis phase where analysis is done on when, where and how the defects occur. The fourth step is improvement, which includes finding the probable solutions and applying those solutions. The final step is control in terms of sustenance of the improvements. Some of the critical processes where BBNL is applying Six Sigma for process improvement are timely complaint resolution, timely order implementation, timely invoice submission and NOC complaint resolution.

Focus on defects

According to Juneja, when the teams started measuring critical business processes they found that the baseline was not as per customer expectations. There were gaps of around 30-40 percent in some processes. The measurement criterion is further defined within the teams in order to avoid any discrepancies. In case the data is not available the team visits customers, interviews them and quantifies on the basis of that. Information technology plays an important role in measuring the processes. Presently about 80-90 percent of the measurement system is automated. All the measurement systems are expected to be fully automated by the end of the current financial year. The baseline having been measured, targets are set for the improvement of the processes. Juneja says that the targets are set based on capabilities and are realistic and measurable. The milestones set are time-bound and are generally quarterly targets.

After analysing the defects, process improvement takes place. Simplifying the process instead of changing the entire process brings in the improvement. The tool essentially requires fine-tuning the process and eliminating those that do not add value. "When you are simplifying the projects productivity goes up within the same resources, thereby leading to optimum utilisation of the resources," says Juneja. One of the ways of simplifying processes is through the use of IT for automation of the processes. IT plays a major role in projects like ‘cycle time reduction’.

The projects are also replicated across various locations of the company and manpower is trained on Six Sigma. This is to ensure that consistency in service levels is maintained across different locations.

Continuous monitoring

The executive committee continuously monitors the projects. There are monthly reviews carried out by the Champion, Sponsor and IGE. A quality dashboard has also been created, wherein every month performance is reported. The CEO and the COO monitor whether the objectives are being met.

Benefits

In the span of six months, the improvements that have come through the Six Sigma
initiative with respect to the set goal on BBNL’s critical processes are:

• Timely complaint resolution—66 percent from baseline
• Timely order implementation—70 percent from baseline
• Timely invoice submission—51 percent from baseline
• NOC complaint resolution—49 percent from baseline

Six Sigma process improvements have translated into productivity enhancements, improved customer satisfaction and process effectiveness. The company has already started receiving customer appreciation and repeat orders from existing customers. In financial terms, BBNL is targeting an estimated saving of around Rs 10 crore in the first year of operation.

Apart from these, Juneja explains that the initiative has also resulted into various other advantages for the company. Applying Six Sigma has improved teamwork with cross-functional teams working together. One of the major breakthroughs for BBNL has been that employees have now started measuring each critical process in the organisation, which has brought in a data culture.

Future roadmap

The company has set the target to achieve 99 percent (i.e. approximately four Sigma level) (‘First Time Right’) with respect to respective set norms by March 2004 on all key critical processes. Most of the current processes are at less than three Sigma level. However, Juneja says that since customer expectations are not static the Sigma levels keep varying. This means that if a process reaches the four Sigma level as per the current expectations of customers it will go down to a lower Sigma level when the customer expectation goes higher.

Since Six Sigma is a continuous improvement initiative, the company will be undertaking another business objective for the next financial year. On the future roadmap are Six Sigma for all processes and higher E-SAT (employee satisfaction) and C-SAT (customer satisfaction) index. BBNL plans to get almost 90 percent of the employees to be Green Belts by 2005, with almost 100 percent of the employees to be involved in the Six Sigma journey by the same time.