4 MINUTE READ
SIPOC is an acronym for Suppliers, Inputs, Processes, Outputs, and Customers and shows how these business entities interact at the boundary of the process. A business process is a time bounded set of activities that consumes resources and produces products and/or services. Each process's SIPOC model provides the reader with a firm idea of the beginning of the process (by showing its resources and suppliers), and the ending points of the process (by showing its outputs and customers). The SIPOC Models provide a process-driven approach to divide the entire scope of the Six Sigma project into manageable partitions.
SIPOC provides a general overview of a business process. It helps people to understand that process by visually summarizing the suppliers, inputs, process functions, outputs, and customers. This visual summary is usually presented in a large table format, often on a wall or white board. This makes it easy to quick see what is going on in the process or activity.
SIPOC a High-Level Process Map
The reason for making a SIPOC table is to get a high-level understanding of a process, most often as an early step in the development of a new process or the improvement of an existing process. The overview provided by the SIPOC diagram allows those managing the project to get a complete picture of the process and how it functions.
Using SIPOC we more easily see how the suppliers and inputs to a process impact the outputs and customers.
SIPOC is not limited to manufacturing processes. It can be used to diagram any type of process, including financial processes, construction projects, HR (hiring or discipline) processes, new product development processes, or any other process.
In addition, creating a SIPOC diagram is the first step in producing a detailed process map, which is often needed in the next stage of the project.
SIPOC Customer Focus
It is not always obvious that the purpose of a process is to produce something a customer needs and values. The immediate "output" may be a part, product, service, or even information, but there is always a customer at the end. To emphasize this customer focus, the SIPOC acronym is sometimes reversed as COPIS, with a "C" at the beginning of the acronym to literally put the customer first.
Who are the customers? The customers are those who receive the process outputs. A customer could be another process, it might be a management committee, or it may be an external customer who is purchasing a finished product.
Whoever the customer may be, the overview provided by a SIPOC diagram shows how each part of the process is ultimately focused on the customer. When everyone can see the system of inputs and outputs involved, everyone better understands this customer focus.
SIPOC is used in conjunction with other lean methods such as Kaizen, or Six Sigma methods such as the DMAIC process. It helps to focus on a specific process by establishing boundaries within which the process exists. These boundaries are:
- suppliers and customers (outer boundary)
- inputs and outputs (inner boundary)
- process functions (steps within the boundaries)
By delineating these boundaries, SIPC helps project managers get a grasp of potentially complex projects and be better able to define the scope of the project.
In many cases the boundaries of a process may not be immediately apparent. For example:
- Customers may either be internal or external.
- Suppliers may either be internal or external.
- Inputs and outputs may be physical materials, or they may be non-physical such as knowledge, man-power or services, energy, information, or computer processes.
- The process itself may be visible or unseen. A visible process would be a person performing work on a component. An unseen process would be a computer organizing data.
The benefits resulting from SIPOC come from SIPOC's ability to help to answer questions such as:
- What are the critical inputs or key suppliers?
- What are our requirements for suppliers, and what are their limitations?
- What happens to the output of the process? Who are the actual customers?
- What are the customer needs or requirements? What are they willing to pay for?
The SIPOC Diagram
A SIPOC diagram is the visual presentation of all of the suppliers, inputs, processes, outputs, and customers. This diagram can be assembled with an overhead projector or computer. However, the best approach has been found to be a whiteboard with erasable markers, or a wallboard with magnetic labels. It is important that the SIPOC diagram be large and easy to change. Having a "wall size" SIPOC diagram makes it visible and readable for the entire team, and SIPOC diagrams may need to be updated and modified frequently.
Answer these questions to build a SIPOC diagram:
- First, what is the process designed to produce, or what is the desired outcome of the project? These are the outputs of the process.
- Who receives those outputs? These are the customers. Customers often are external, such as the people or organizations who pay to purchase the output. However, the customers may be internal to your organization; the process output may be components that are then used in another process.
- What are the inputs needed for the process to function and produce the desired output? Inputs are not limited to materials. They include manpower, electricity, water, computer process and storage capability, and anything else required for the process to work.
- Where do those inputs come from? These are your suppliers. Like customers, suppliers may be internal, external, or even a combination of the two. Is the process started when an order is receive from a customer? If so, then the customer is supplying a "start" instruction. At what point does the process stop?
- Identify the 5 to 7 major steps in the process. What is the process doing? If there are ten or more steps on this list, then the process may need to be divided into two parts, with a SIPOC diagram for each part.
- Now that you have the shape of your diagram, fill in additional details. Identify feedback loops between inputs and outputs. Look for mismatches between needed inputs and available suppliers, as well as between customer expectations (requirements or specifications) and the outputs.
Additional details can be added at any point in the development of the SIPOC diagram. A SIPOC diagram should be easy to modify and expand as more information, such as customer requirements and specifications, becomes available.
SIPOC Gemba - Labels and Signs
While labels may be a part of creating a SIPOC diagram, such as using magnetic labels to build the SIPOC diagram, they play a more important role in visually relating physical locations and resources to the SIPOC diagram. "Gemba" is an important part of lean processes. Gemba means "the real place," that is, the place where the work takes place.
Labels and signs are used to mark the real place (gemba) so that it is easy for anyone to relate what is seen on the SIPOC diagram with an actual physical location. They also communicate safety information so that everyone stays safe.
Using visual communication to support SIPOC requires the ability to change the signs and labels as needed. This requires versatility, as well as a labeling system that is extremely easy to use. That means a DuraLabel custom labeling system is required. With DuraLabel, you have the versatility to make whatever type of label or sign is needed. And DuraLabel printers are so easy to use that anyone can make the needed labels and signs. Call 888.326.9244 today for more information.
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