April 02, 2009
10 Steps to SURVIVE and even GROW Your Business during a RECESSION
Considering the most recent recession we find ourselves in, one question I am being asked more and more is how business owners can survive during a recession. To me these are very interesting questions, especially since they are mostly born out of a feeling of understandable insecurity and uncertainty. Insecurity and uncertainty, however, are two of the main drivers that push an economy into a recession. Hence, on the flip side, a generous spread of positive attitude and confidence are some of the most important elements to a recovering economy.
Here's the great news: Not only can you survive a recession, you can even grow your business and thrive in a recession!!!
I've build and even sold businesses during downturns and recessions, and while it seems like an insurmountable challenge when you think about it in theory, once you're behind the wheel and start to focus on what's important it becomes clearer, easier and ultimately second nature.
Below I've put together my short list of options to consider and implement to maximize your business growth, even if the economy turns down. Are you ready? Ok, here we go. We're cutting all the BS and get down to what really matters during tough times! Here are 10 ideas you can (and should) implement to maximize your business growth; if the economy sucks (they also work during good times, btw). ;)
Ben's Rule #1. Get back to the basics! Hunt for new business from new prospects. Don't make the mistake of waiting for prospects to find you! Start cold calling! Feel uncomfortable about cold calling? Get over it! Losing your business is going to feel much worse! Rule: In a slow economy, you NEED to find business - don't wait for business to find you!
Ben's Rule #2. Remember you talked about this for years? Now it's time to act! Increase your sales and marketing efforts, repackage your current offerings with new names and a lower price. Offer an automatic product or service upgrade (in feature or units) with the new name or tie the new offering to a timed date. Use automatic renewals wherever you can. I have done this in several of my companies with massive success.
Ben's Rule #3. Feel the pinch of recession in your wallet? Well, so do your customers! Make it easier for them to pay you by offering extended payment terms. You can increase your price by 10-20% to offset the cost of not getting prepaid for your work, but this will make it easier for your buyers to buy.
Ben's Rule #4. Network! Network! Network! Go to trade shows, conferences, mixers, chamber of commerce events, coffee klatches, even Tupperware® parties - whatever even remotely applies to your line of business - etc. to expand your partnerships and subsequently reduce your acquisition costs per sale. In a poor economy, partner with other companies to increase your networking and lead generation success, which will ultimately lower your lead capture costs.
Ben's Rule #5. Have a world map? Get it out of your kid's room and start looking at it! Take advantage of the global village. The sky is the limit! Widen your sales and customer geography. If your market is saturated or too hesitant because times are tough, expand beyond where you are right now to find more opportunities.
Ben's Rule #6. Spend money!!!. No, I'm not kidding. Yes, spend more $$$ on marketing during a recession! Marketing is definitely not a line item you want to cut back on now. If times are tough, spend more money. During a recession, the cost of marketing lead generation usually goes down because advertisers become desperate for business. Also, product cost might go down and volume discounts are suddenly much easier to get. Your supplier, who used to laugh at your earlier attempt to haggle, might suddenly be much more pliable - use your awareness of timing to your advantage.
Ben's Rule #7. Lower cost! Yes, there is a time and place to save money. Renegotiate all your supplier contracts. Focus on reducing your COGS (cost of goods sold). What options do you have to drop its production, labor or direct costs? Hey, we're in a recession, right? Once again, use that line and NEGOTIATE!
Ben's Rule #8. Use psychology! No, I don't mean you should talk to a shrink! Just be creative and read about consumer behavior. One good example for what you might get out of this: Generate three pricing levels for your products and service with the mid-level price being the targeted price you want to sell at. Here's where your reading comes in handy: Several studies have shown conclusively that buyers consistently purchase the middle price when offered three options. Use your knowledge to your advantage.
Ben's Rule #9. Be bold - make them come to you! A great way to effectively reduce your travel and expenses is to offer your prospects cash (i.e. $500 off their first invoice), if they travel to you and buy -- instead of you and/or your team going to them. This approach not only keeps your money in the bank, but it also helps you qualify prospects by making them take an action (they need to come to you).
Ben's Rule #10. Show them that they're much better off with than without you! Change your value proposition to focus on cost savings. To drive your prospects to buy during a recessionary time, you need to focus your product or service messaging on how your offering reduces their business costs, directly or indirectly. Make them love you and remind them of all the money they are saving with your product or service.
Still not confident? Need a little more pep talk? Ok! Don't be a victim! Repeat after me: "I will not be a victim of this recession!" Say it out loud whenever you feel tightness. Look at a recession as an opportunity! As some sort of wealth re-distribution. Wayne Dyer once said "if you change the way you look at things, the things you look at change." That holds very true especially in the event of a recession.
Think positive and understand that recessions are a natural part of an economic cycle. If you know how to act and react during a slow economy you will find that recessions also offer a tremendous number of opportunities. No, I really am not delusional. Here is an example: Remember a year or so ago, when you looked at the stock market and saw GE trading at $40/share and you wished you would have gotten in at $20? Well, you could have picked up some GE shares for less than $6 just a few weeks ago (they're already back up to $11 now, but still a bargain in my book). I'm not sure about you, but I call that one heck of an opportunity!
I can even pick this example apart a bit more for those of you who like a more pragmatic approach. Opportunities are defined as possibilities due to a favorable combination of circumstances. GE's pricing was pushed down by the recession and investors selling their GE stock in fear of losing value. That is your combination of circumstances, which is needed to create an opportunity. Now, just as a recession is a natural part of an economic cycle, so is an expansion. It will happen and you know it! That is your possibility! Put both together and you should hear opportunity knocking on your door with a vengeance right now. Can you hear it? No? Ok, read this post again, then discuss it with your friends and fellow business owners and definitely let me know once you do hear the knocking. I know you ultimately will. You have it in you and I'm rooting for you!
March 25, 2009
28 Rules Men Wish Women Would Learn
While I try to stay (somewhat) professional on my blog and not all of the things below express my personal opinion, I just couldn't resist posting this list here. ;)
1. When we say 'we don't want a relationship' we mean it and it is not code for 'we haven't met the right girl yet and you might change us'.
2. Just learn to work the toilet seat: It's very simple, if it's up, just put it down. There is no practical reason that it should be left in the position that you want it in.
3. No, don't cut you're hair. Ever.
4. Birthdays, Valentines, and Anniversaries are not quests to see if we can find the perfect present, again!!
5. If you ask a question you don't want an answer to, expect an answer you don't want to hear.
6. Sometimes we are not thinking about you. Learn to live with it.
7. Don't ask us what we are thinking about unless you are prepared to discuss such topics as our career, the shotgun formation, the bad tee-shot we hit on #14, or sports cars.
8. Get rid of your cat. And no, it's not different; it's just like every other cat.
9. Sunday = Sports. It's like the full moon or the changing of the tides. Let it be.
10. Shopping is not a sport and it certainly is not retail therapy.
11. Anything you wear is fine. Really!
12. Yes, you have enough clothes and yes, you have too many shoes.
13. Crying is blackmail. Use it if you must, but don't expect us to like it or always respond favorably.
14. Ask for what you want, exactly. Men are simple, subtle hints usually don't work with us.
15. No, we don't know what day it is. We never will. Mark Anniversaries and Birthdays on a calendar.
16. Yes, peeing standing up is more difficult than peeing from pointblank range. We are bound to miss from time to time.
17. We survive with three or four pair of shoes. It is ridiculous to ask our help choosing which pair, out of fifty, would look good with your dress?
18. Yes and no are perfectly acceptable answers.
19. It is neither in your best interest nor ours to take any quiz together.
20. Anything we said 6 or 8 months ago is inadmissible in an argument. All comments become null and void after 7 days (the most).
21. If something we said can be interpreted two ways, and one of the ways makes you sad and angry, we meant the other one.
22. You can either ask us to do something or tell us how you want it done — but, not both.
23. Whenever possible, please say whatever you have to say during commercials.
24. Consider golf, football, or fishing a mini vacation from you. We need it, just like you do.
25. Telling us that models in the men's magazines are airbrushed makes you look jealous and petty and it's certainty not going to deter us from reading the magazines.
26. The relationship is never going to be like it was the first few months we were going out.
27. Please don't ask us "Do I look fat" and expect an answer that satisfies both of us. Insecurity is less attractive than love handles.
28. Even other women admit to these things. Don't believe it? Listen to One-Hit Wonder Meredith Brook's hit song "Bitch" below. ;)
February 24, 2008
It's not about WHAT, but WHO you know!
I'm using LinkedIn.com to organize my professional contacts because I believe in the power of connections and who hasn't heard about the famous "six degrees of separation". Many times, things in my personal and professional life happened because of opportunities that I was offered or found through people I was somehow connected to. No matter where you are in your career, most of the time, relationships are the secret to ultimate success in business or otherwise. Success starts with building and maintaining these relationships!
"How on earth did I get in here?" I kept asking myself in those early days as an overwhelmed entrepreneur back in super-conservative Germany. There wasn't a single accounting or finance class in my background. My only exposure to business in my family was my uncle who was a self-made millionaire who build a hugely successful specialty restaurant and hotel. Looking around me, I saw ruthlessly focused young men and women who seemed to all know more than me about business. They'd gone on to crunch numbers or analyze spreadsheets in companies they or their families had build and seemed to do really well. Some were from wealthy families, and had pedigrees and legacies and the occasional "von", "van" and "de" in their names. It was pretty intimidating.
How was a guy like me from a working class family, with a high school degree, and a bunch of black belts going to compete with purebreds from Uni Heidelberg, or former Daimler Benz and Deutsche Bank interns who, from my perspective, seemed as if they'd been starting companies from their cribs?
The "Other" Thing
Good old hard work, I reassured myself, was one of the ways I'd beaten the odds and gotten into really good schools and obtained several black belts in various kind of martial arts. Sure, I'd read hundreds of business books and snug into University classes that were not part of my curriculum, but there was something else that separated me from the rest of my peers, and gave me an advantage. I seemed to have learned something long before I arrived on the entrepreneur level and it looked as if many of the other folks did not.
As a kid, I bought groceries at the local supermarket for the elderly living across the street from our apartment building who had a hard time walking all the way to the market themselves in return for tips. I also did anything I was allowed to do at the local country club for the homeowners and children living in the wealthy part of town. It helped to open my eyes at an early age to recognize some of the things that set apart those who succeed and those who do not.
During those endless walks to and from the market, as I carried my grocery bags, I thought about how the people who had reached professional heights unknown to my mom and dad (or my family in general) helped each other. They found each other jobs, they invested time and money into each other's ventures and ideas and they made sure their children got help getting into the best schools, got just the right internships, and ultimately landed best jobs.
Before my very own eyes I saw living proof that success breeds success and, indeed, the rich do get richer. Their network of friends and associates was the most potent club the people I worked for had in their bag. Poverty, I realized, wasn't only a lack of financial resources; it was isolation from the kind of people that could help you make more of yourself.
I came to believe that in some very specific ways, life, like my beloved martial arts, is a game, and that the people who know the rules, and know them well, play it best and ultimately succeed. And the rule in life that has unprecedented power is that the individual who knows the right people, for the right reasons, and utilizes the power of these relationships, can become a member of the "club," whether they started out as a grocery boy or not!
Coming to America
What many of my fellow peers lacked, I discovered, were the skills and strategies that are associated with fostering and building relationships. I became good at networking early on and have continued to build my own web of friends and associates over the years. After I came to America in 1994 I came to realize that no matter where you want to build your company or life the same rules still apply. Success in any field, but especially in business, is about working WITH people, not against them. No tabulation of dollars and cents can account for one immutable fact: business is a human venture, pushed forward and determined by people.
In the U.S., and especially in business, many people are brought up to cherish Lone Wolf individualism. Folks who consciously court others to become involved in their lives are seen as schmoozers, brown nosers, or smarmy sycophants.
Bow before the Master
in 1994, while learning English, I met a guy who went on to become my voice coach at first and ultimately my best friend. "Pete" (the Ben Neumann way of spelling "Petie"), I learned quickly, had gotten a license from an apparently higher power to be everybody's best friend. People were (and still are) flocking to Pete like insects to light. This guy, I realized, was the manifestation of my connector theory and to see a true natural master of connections work was exciting and humbling at the same time.
Pete, while introducing me to virtually 75% of the people who today make up my friends and social environment, taught me how to reach out to people as a way to make a difference in people's lives, as well as a way to explore and learn and enrich my own; it became the conscious construction of my life's path. I didn't think of it as cold and impersonal, the way I thought of "networking." I was, instead, connecting - sharing my knowledge and resources, time and energy, friends and associates, and empathy and compassion in a continual effort to provide value to others, while coincidentally increasing my own. Like business itself, being a connector is not about managing transactions, but of managing relationships.
I learned that true networking was about finding ways to make other people more successful. Over the years I have mentored people into very successful business and relationship people and hopefully also enriched their personal lives. It was always about working hard to give more than you get. And I came to believe that there were a long list of tough-minded principles that made this soft-hearted philosophy possible. My other best friend Chris keeps encouraging me to write these things down and one day publish them in book form. I'm not sure, if that is what I will ultimately do, or if I just pass them on to my two boys, but it sure is a flattering thought.
My "Ben Neumann Principles of Success in building successful Relationship" (still working on the wording
February 21, 2008
Today was a NIGHTMARE-DAY! Globat.com just emerged from a major outage - the worst in company history and everybody - customers and staff alike - still feel extremely beaten up. Here's what happened:
At approximately 5:00am Pacific Time on Thursday, February 21, 2008 we suffered a major network outage, which effected nearly all Globat.com customers, our own Web sites and service infrastructure as well as our phone systems.
Our primary network switch in our main datacenter in downtown Los Angeles failed completely and despite tremendous efforts by our technical emergency response team could not be brought back online. This switch is a major brand name piece of equipment and as such it contains internal redundancy. We were able to switch over to the back up circuitry and begin bringing the system back online at which time, for yet unknown reasons, the entire devise, including backup system, failed completely.
After a short deliberation we decided to rush a new switch from our vendor's nearest warehouse to our data center. While waiting for the replacement we initiated a work around to at least get email service re-established. After several attempts all email systems finally went live and back to normal at approximately 10:00am Pacific Time.
When the new switch arrived we went through the installation and testing process and as a result were able to bring all our services back online, but not before we had suffered a 5-hour outage for e-mail services and an 8-hour outage for Web related services. In Globat's entire 6 year history, we have never experienced anything even remotely like this! The outage was so severe that it affected our own Web sites and all but one of our telephone lines so we were unable to communicate with our customers to update anybody about the status of the incident. We decided to ask some of our staff members to post updates on well known Internet forums, which helped a little in disseminating the information.
Now that everything is pretty much back to normal I would like to tell you that we ABSOLUTELY KNOW you count on Globat.com to maintain a high degree of uptime to host your Web sites and that we take this trust very seriously. Today, however, my team and I let you down and we all feel terrible because of that. This has never happened before and we will do whatever it takes to never let it happen again! I deeply and sincerely apologize for this outage and the inconvenience and problems it may have caused. We promise to learn from the events of this dreadful day (today was also my wife's birthday, on top of everything).
We are now taking the following steps to prevent a recurrence of this type of failure. This switch is the only piece of equipment at Globat.com that could possibly be a single point of failure. This equipment is usually highly stable and has built-in redundancy. In addition it is being vendor monitored 24/7. We will now keep a second switch, with its own built-in redundancy, in our data center to prevent a prolonged outage in the unlikely event of another switch failure. In addition, we are working with our phone vendor to create an automated failover system so calls will be routed directly to remote support sites in the case of a failure of our primary phone system.
While nobody can completely prevent any form of failures in the future, with these changes we can certainly minimize the effects of such failures and reduce the impact on you, our valued customers.
Globat.com's Director of Customer Service, Tom Cox, stands by to provide even more information, in case you would like to discuss this event further or are still experiencing any problems. You can reach Tom at firstname.lastname@example.org.
At the time of me writing this message all of our systems appear to be back up and running and I can assure you that our network operations team will continue to investigate this unfortunate event.
In closing I would like to thank the entire Globat.com team (especially Chris, Lou, Tim, Don and Rene) for working nonstop, without sleep or interruption to resolve this issue and, of course, our customers for their many encouraging comments and especially their incredible patience. You are certainly very much appreciated!
Ben R. Neumann
Chief Executive Officer
October 05, 2007
The History of Thanksgiving
Given that I was born and raised in Germany I have always looked at our American Holidays with curiosity and respect. Now that I have kids myself I do my best to instill into my 2 little guys a beginning sense of respect for such Holidays as Thanksgiving by telling them stories about why we celebrate this as a Holiday and what it really means. I did, of course, do "my history homework" and brushed up on some of the numbers and dates to not spread common wisdom half-truth and to make sure that my boys get a good idea of where, when, and what it was that made Thanksgiving the special Holiday my family - and most other American families - loves so much.
The traditional Thanksgiving is a combination of religious and harvest celebrations. The Pilgrim Feast of 1621 is generally what we think of when we think of the very first Thanksgiving. The pilgrims just had a really good harvest after a very difficult winter. To celebrate, the pilgrims called for a huge feast! In addition to the pilgrims, 90-some Native Americans attended. They all probably had to sit and eat outside at a huge table. The celebration lasted 3 full days, and included games, races, and other activities. Plus, of course, loads of food! Though nobody's really sure if they actually ate turkey back then, we know that they did have venison and some type of fowl. And even though they couldn't eat pumpkin pie (because of a flour shortage), they did have boiled pumpkin. They also had berries, seafood, and fruits.
But that feast wasn't repeated every year. And it wasn't until 1777 that all 13 colonies had a Thanksgiving celebration together. Nowadays most people credit Sarah Josepha Hale with making Thanksgiving an annual and national event. Sarah was an influential magazine editor who wrote lots of letters (and I mean thousands) and articles about why America should make Thanksgiving a regular, national holiday. Finally on October 3, 1863 President Abraham Lincoln agreed and in the midst of the civial war he created the Proclamation of Thanksgiving where he set the last Thursday in November as Thanksgiving Day. Other presidents followed Lincoln’s example. But, in 1939, President Franklin D. Roosevelt changed the date from the fourth to the third Thursday of November to accommodate the wishes of business merchants, who were eager for more shopping time before Christmas. This caused so much opposition that in 1941, a Congressional Joint Resolution again made Thanksgiving the fourth Thursday of November and it was finally a national, legal Holiday. For interested people who wish to dig in even deeper, The History Channel has a really well prepared and fun section on the History of Thanksgiving.
Many different countries all over the World celebrate a holiday like Thanksgiving. Whenever it is, it's a great time to be really thankful for all of your friends, and family, and the life we have! Have fun and a Happy Holiday!
July 14, 2007
Six Sigma or the Jack Welch Way of Kicking Butt
Ok, I've posted my thoughts on service, quality and what a lack thereof can do to an organization here on my blog several times over the past year and a half. For the record, I AM A QUALITY ADVOCATE! So are the majority of the people who work for me and/or with me. I am, and always have been, fully committed to found, fund, and run only quality companies and release only quality products that provide a true benefit and value to the people using them. I hate that sometimes I have to face an unhappy customer, yet the fact that we at Globat at times do fall short of customer's as well as our own expectations does not change my mindset about quality at all. I will keep leading the charge to change a status quo and iron out any issues that may come up. I am a big Six Sigma enthusiast and am behind the principles and the tremendous benefits this methodology can bring to virtually any organization.
Jack, Six Sigma and Billions of Dollars.Motorola created Six Sigma as we know it today, while former GE Chairman Jack Welch made the term a US business household name. It was in the early 1990's, only 2 years after Motorola became one of the first companies to receive the Malcolm Baldrige National Quality Award for its development and pursuit of Six Sigma quality, that Jack Welch, then Chairman and CEO of General Electric, began to get interested in Six Sigma. In fact, before Six Sigma, Welch had not considered himself a true quality enthusiast. He felt the earlier quality programs were too heavy on slogans and light on results. In 1995, after GE Corporate Executive Council meeting Welch conducted a cost-benefit analysis on Six Sigma implementation. The analysis showed that if GE, then running at around three to four sigma quality level, were to raise its quality to Six Sigma, the cost saving opportunity was somewhere between $7 billion and $10 billion. This amounted to a huge number and stood for approximately 10 to 15 percent of GE's sales.
It All Starts With Commitment.
In January 1996, Welch announced the launch of Six Sigma at GE. At that time, he called Six Sigma the most ambitious undertaking the company had ever taken on. He stated: "Quality can truly change GE from one of the great companies to absolutely the greatest company in world business." Needless to say that when GE does something, it does it all the way. Welch said to GE's Corporate Executives: "Everyone in this room must lead the quality charge. There can be no spectators on this. What took Motorola ten years, we must do in five - not through shortcuts, but in learning from others". From that moment, Jack Welch became the global promoter of Six Sigma.
There are two important contributions from GE's way of implementation to the evolution of Six Sigma. First, Welch demonstrated the great paradigm of leadership. Second, Welch backed the Six Sigma program up with a strong rewards system to show his commitment to it. GE changed its incentive compensation plan for the entire company so that 60 percent of the bonus was based on financials and 40 percent on Six Sigma results. The new system successfully attracted GE employees' attentions to Six Sigma. Moreover, Six Sigma training had become a prerequisite for advancement up GE's corporate ladder. Welch insisted that no one would be considered for a management job without at least a Green Belt training by the end of 1998.
Oh, Now, What is Six Sigma?
Simply put, Six Sigma is an applied methodology for improving business and organizational performance, originally developed by Motorola, by eliminating defects. It addresses widely accepted principles and helps tremendously to make "business better". For all of you who are thoroughly familiar with Six Sigma I ask patience while I try to get everybody else to get up to speed on it. For everyone who would like to find out more about it, please read on.
You can safely say that Six Sigma, in it's core, is a methodology for minimizing mistakes and maximizing value. Every mistake an organization or person makes ultimately has a cost - a lost customer, the need to do a certain task over again, a part that has to be replaced, time or material wasted, efficiency lost, or productivity squandered (sounds familiar?). In fact, waste and mistakes cost many organizations as much as 20 to 30 percent of their revenue (Globat is definitely no different in that respect)! I think that's a disturbing number. Imagine throwing 20 to 30 percent of your money away in the garbage every time you cash a check. It may sound ludicrous, but that' s what many organizations do. All businesses, organizations, and individuals have room to improve. No operation is run so tightly that another ounce of inefficiency and waste can't be squeezed out. By their nature, organizations tend to become messy as they grow. Processes, technology, systems, and procedures - the ways of doing business - become cluttered with bottlenecks, meaning work piles up in one part of the organization while other parts sit idle with nothing to do. Work is often performed incorrectly, or the outcome is flawed in some way. When this happens, you scrap products and services and have to do the work over again: You consume additional resources to correct a problem before it's delivered to the customer, or the customer asks later for a "redo", a new product or a more satisfactory service. Sometimes, flaws and defects aren't the problem, but a product or service simply takes too long to produce and deliver (dare I say we face that with certain product releases and upgrades many times). Think about the problems a business bank would have if it processed letter of credits absolutely perfectly, but did so 6 times slower than the competition. That's a perfect disaster.
Defining Six Sigma was once a quality-improvement methodology, but now it's a general-purpose approach to minimizing mistakes and maximizing value. How many products can we produce, how many services can we deliver, and how many transactions can we complete to an expected level of quality in the least possible amount of time at the lowest possible cost? Six Sigma takes effort and discipline and requires you to go through the pain of change. But eventually that pain is transformed into improved performance, happier customers, lower costs, less complaints, better reputation, with that and more success.
Six Sigma performance, by definition, is the statistical term for a process that produces fewer than 3.4 defects or errors per million opportunities. Picture that in the grand scheme of building and running a business, any business. Hence, very few companies can actually achieve Six Sigma or even Five Sigma performance (fewer than 233 defects per million opportunities) in their final products, because there are so many critical processes, process activities, people, machines, and materials that have to interact along a chain of causation and span of time; good luck trying to get them all to work in line! Yet, it is the actual process of improvement to achieve Six Sigma performance that gradually evokes the change in an organization.
Six Sigma has two main key methodologies, DMAIC and DMADV. DMAIC is used to improve an existing business process. DMADV is used to create new product designs or process designs in such a way that it results in a more predictable, mature and defect free performance.
DMAIC methodology consists of the following five steps:
1. "D"efine the process improvement goals that are consistent with customer demands and enterprise strategy.
2. "M"easure the current process and collect relevant data for future comparison.
3. "A"nalyze to verify relationship and causality of factors. Determine what the relationship is, and attempt to ensure that all factors have been considered.
4. "I"mprove or optimize the process based upon the analysis using techniques like Design of Experiments.
5. "C"ontrol to ensure that any variances are corrected before they result in defects. Set up pilot runs to establish process capability, transition to production and thereafter continuously measure the process and institute control mechanisms.
DMADV methodology consists of the following five steps:
1. "D"efine the goals of the design activity that are consistent with customer demands and enterprise strategy.
2. "M"easure and identify CTQs (critical to qualities), product capabilities, production process capability, and risk assessments.
3. "A"nalyze to develop and design alternatives, create high-level design and evaluate design capability to select the best design.
4. "D"esign details, optimize the design, and plan for design verification. This phase may require simulations.
5. "V"erify the design, set up pilot runs, implement production process and handover to process owners.
As you can see, the core of the Six Sigma methodology is a data-driven, systematic approach to problem solving, with a focus on customer impact. Statistical tools and analysis are often very useful in the process. However, it is a mistake to view the core of the Six Sigma methodology as pure statistics; an acceptable Six Sigma project can be started with only very basic tools (such as simple Visio diagrams to visualize a process). There simply is no excuse for not attempting to make things better - for everybody's sake! All we, and everybody who believes in the same principles, have to do is go for it. Just remember that a journey of a thousand miles starts with the first step!