Continuous process improvement is mandatory for any business to stay profitable. But, we often find it challenging to get all team members on the same page while discussing a process improvement strategy. Enter the SIPOC diagram — one of the top Six Sigma tools. It helps you offer all stakeholders a high-level overview of the complete business process through mapping.
If you require the proper assistance to coordinate with your team members, learn and create a SIPOC diagram for your project. In this guide, we talk about every detail of this Six Sigma tool that aids in Lean project management, provide SIPOC examples, and show you how you can learn this valuable methodology to boost your career in quality management.
So without further ado, dive in.
What is SIPOC?
The SIPOC (pronounced sigh-pock) model was first introduced in the second half of the 20th century. ‘SIPOC’ is an acronym for Suppliers, Inputs, Processes, Outputs, and Customers. It is a part of the Six Sigma business process improvement methodology.
A well-curated SIPOC model helps you perform business process analysis, identify problematic areas, build effective improvement strategies, and coordinate with the team members. It involves a visual representation of the complete business process in a table form called the SIPOC diagram.
What is a SIPOC Diagram?
The SIPOC Six Sigma diagram is a map of the business process. As mentioned, this visual document is presented in a table form. It contains the summary of the inputs and outputs of one or multiple procedures. Instead of a detailed overview, you’ll find the initial inputs and results documented in a straightforward manner.
A typical SIPOC template should look like the below table and include the mentioned details:
|Details||Who supplies the inputs?||What are the inputs? (resources provided by the supplier)||What processes (activities) are carried out with the inputs?||What is the end result of the process?||Who benefited from the process?|
|Example||Wood suppliers||Customized furniture||Furniture assemble and design||Furniture crafted as per requirements, invoice prep, shipping date||Small households|
As you can see from the table above, there are five components of a SIPOC template:
- Suppliers: Providing the inputs.
- Inputs: Resources or materials required to complete the process.
- Process: Activities performed to convert the inputs to outputs.
- Outputs: A product or service produced from the process.
- Customers: Recipients of the outputs.
You can create a SIPOC diagram of any business process involving these five elements.
Check out the SIPOC examples below that we created for different business processes:
|Example 1||Hiring Process||Job boards, Referrals, Staffing agencies||Job description, Applicant resumes, Candidate assessments||Screening, Interviews, Background checks, Hiring decision||Job offer, Onboarding paperwork, Employment contract||New employee, Hiring manager, HR department|
|Example 2||Product Delivery Process||Raw material suppliers, Component suppliers, Logistics providers||Customer Order, Delivery schedule, Production schedule||Inventory management, Quality control, Order processing, Production||Completed product, Delivery confirmationn, Customer satisfaction survey||End customer, Sales team|
|Example 3||Patient Discharge Process||Admitting department, Medical staff, Pharmacy||Medical history, Test results, Treatment plan||Discharge planning, Medication reconciliation, Patient education||Discharge summary, Medication list, Follow-up appointment||Patient, Caregiver, Healthcare provider|
|Example 4||Software Development Process||Software tools providers, Hardware providers||User requirements, Design specifications, Testing plan||Development, Coding, Testing, Debugging||Working software, User manual, Release notes||End user, IT department|
|Example 5||Restaurant Service Process||Food suppliers, Kitchen staff, Wait staff||Menu, Order tickets, Table assignments||Meal preparation, Table service, Payment processing||Prepared food, Paid bill, Customer feedback||Diners, Restaurant management, Kitchen staff|
Note: The specific details included in a SIPOC diagram will depend on the nature of the process you are analyzing.
SIPOC Diagram vs. Workflow Diagram
While a SIPOC analysis is used to curate the key overview of a business process, a Workflow diagram shows more detailed information.
Here is a table comparing the key differences between a SIPOC and a workflow diagram:
|SIPOC Diagram||Workflow Diagram|
|Purpose||High-level process mapping tool||Detailed process mapping tool|
|Focus||Suppliers, inputs, processes, outputs, customers||Specific steps of the process|
|Level of Detail||Advanced view of the process||Detailed view of the process|
|Scope||End-to-end process mapping||Specific process area mapping|
|Use case||Process improvement, cross-functional collaboration, compliance management, supplier evaluation||Process analysis, optimization, and automation|
|Benefits||Helps to understand the big picture of a process, identify areas for improvement, facilitates collaboration||Helps to identify bottlenecks and inefficiencies, optimize processes, and automate workflows|
|Example||Manufacturing process flow, hospital patient care process, etc.||Sales order processing, accounts payable process, etc.|
Note: Both diagrams serve as useful tools for process mapping. But, choosing between a SIPOC and a workflow diagram will depend on your specific needs and how you intend to use it.
How to Create a SIPOC Diagram?
To create a SIPOC diagram, follow a seven-step method outlining all the SIPOC elements. We have discussed the steps in detail below.
Step 1: Choose a Process
First, you must choose the process you want to map out. It can be a business, manufacturing, or any other process you want to analyze. However, clearly understand the process and its scope before moving on to the next step.
Step 2: Identify the Outputs
Next, you need to identify the outputs of the process. Outputs are the products or services delivered to the customers. You must consider the QA parameters to measure the success of the output while making the SIPOC diagram. For instance, if the output is a product, its quality standards depend on functionality, durability, and aesthetics.
Step 3: Identify the Customers
After outputs, identify the customers who will receive the process. Internal and external customers can be involved depending on the nature of the process. For example, the customer can be the end-user if it is a manufacturing process. Whereas the customer of a service process will be the service recipient.
Step 4: Identify the Inputs
Now, identify the inputs. Inputs are the resources used to create outputs. These could be raw materials, labor, machinery, or any other resources involved in the process.
Step 5: Identify the Suppliers
Then, you must identify the suppliers who will provide the inputs. These inputs are required to complete a process. Starting from a manufacturer to a distributor or a vendor can be categorized as a supplier.
Step 6: Define the Processes
Once you finish all the above steps, define your chosen process. Here you will explain the activities performed to transform the inputs into outputs. Ensure that the key steps are mentioned in the sequence they have occurred.
Step 7: Create the SIPOC Diagram
The final step is to document the SIPOC Six Sigma diagram. You can do that using a SIPOC template containing Supplier, Input, Process, Output, and Customer elements. Make sure your SIPOC diagram is easy to read and understand. Other stakeholders involved in the process improvement must review it to ensure maximum accuracy of the details.
Please note that a SIPOC diagram is another tool for business process improvement.
When to Use a SIPOC Diagram?
You can use the SIPOC diagram on many occasions. It is a flexible tool that helps businesses improve efficiency and effectiveness in their processes.
Here is the list of standard business processes where drafting a SIPOC diagram has been proven effective:
New process design
A SIPOC diagram ensures all necessary elements are there when designing a new business process. For example, a manufacturing company creating a new product line can use a SIPOC Six Sigma diagram to map the process, including suppliers, inputs, performed activities, outputs, and customers.
If you want to improve an existing business process, use SIPOC analysis. With it, you can identify the root cause of an issue and work on that. For instance, a hospital may use a SIPOC diagram to identify areas where patients are experiencing long wait times or unnecessary delays and then work to streamline those processes.
A SIPOC diagram facilitates cross-functional collaboration among different departments or stakeholders involved in a process. In this SIPOC example, a retail company can use a SIPOC analysis to bring together sales, marketing, and operations teams to optimize the product delivery process.
You can use a SIPOC analysis to evaluate the performance of suppliers. Timely evaluation is the key to cutting down unnecessary resource consumption. For instance, a restaurant can use a SIPOC diagram to assess the performance of food suppliers, including factors like delivery time, quality of product, and pricing.
A SIPOC diagram can also ensure compliance with regulations and standards. You can do it by mapping out the process elements and finding potential areas of non-compliance. E.g., a pharmaceutical company can use a SIPOC diagram to ensure compliance with FDA regulations for drug development.
Benefits of a SIPOC Diagram
There are several benefits of using a SIPOC diagram. From improving business processes to building good communication between team members, a SIPOC Six Sigma diagram can help you in many ways, such as:
- Providing a clear visual representation of the business process
- Identifying the critical elements of the process
- Helping identify areas for improvement in an existing business process
- Clarifying the roles and responsibilities of the stakeholders
- Facilitating communication and collaboration between team members
- Helping manage changes by analyzing their impact on suppliers, inputs, processes outputs, and customers
- Supporting continuous process improvement
Learn SIPOC & More Lean Six Sigma Skills
SIPOC is a crucial tool for Lean Six Sigma experts as it provides an overview of a process, which can be used to identify areas of improvement. It helps Six Sigma experts better understand the process they are working on and identify potential areas of waste or improvement. Moreover, it helps ensure that the process runs efficiently and that all stakeholders be on the same page.
By understanding SIPOC, an aspiring Lean Six Sigma expert can ensure they take a comprehensive approach to process improvement and that the process improvement team can work more effectively and achieve better results. Overall, the SIPOC diagram is an excellent tool for your process improvement toolkit.
A Lean Six Sigma course can be a great way to learn about SIPOC and the complete Six Sigma model for efficient project management. Solve real-world business problems with hands-on projects and get the guidance of industry experts to achieve mastery of quality management concepts and methodologies. With a Lean Six Sigma online certification from the University of Massachusetts Amherst, you can fast-track your career as a Lean Six Sigma expert and attract top recruiters in the field. Get started now!