The Ultimate Guide To Understanding SIPOC Diagrams

October 8, 2022
Alok Suman
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Organizations are built on the foundation of robust processes and operations. To that end, endless methodologies and techniques exist to help streamline the entire ecosystem of business operations.

Six Sigma practices help with incorporating lean process methodologies. To get a better view of a Six Sigma project, a method called SIPOC is implemented that helps generate a high-level super-view of the details.

By adopting SIPOC methodologies, your business would be able to reduce process wastage and eliminate or streamline inefficient business operations and practices. Let’s understand everything there is to know about SIPOC.

What is a SIPOC Diagram?

SIPOC is a tool in Six Sigma practices that teams utilize to identify the relevant elements of a business process. It is the practice that teams adopt to document business processes diagrammatically for a more holistic view and understanding of the process elements.

For example, for the process of onboarding new talent, your company could create a SIPOC diagram to identify redundancies in processes to eliminate human resource wastage.

Through a SIPOC diagram, you can simply determine the scope of a project with intricate complexities. A good instance is creating a SIPOC diagram for your supply chain processes.

These diagrams enable you to break down each business process into distinct parts that give unique insights into various process aspects. For the supply chain, for example, you can create a SIPOC diagram that clearly mentions every vendor, activity and resource involved.

Elements of a SIPOC Diagram

A SIPOC diagram has five distinct elements. It is actually the acronym for Suppliers, Inputs, Processes, Outputs, and Customers.

Each element of a SIPOC diagram highlights different aspects of a process and provides a complete picture of what is going on.

  • Suppliers: This signifies the sources from where the process gets its inputs.
  • Inputs: This is the actual input that goes into the process necessary for its execution.
  • Process: This aspect highlights the steps of the process that transform the inputs into the outputs.
  • Outputs: This element highlights the end product that a process generates.
  • Customer: This is the element that highlights the end-user or customer of the output generated by a process.

What is a SIPOC Diagram Used for?

SIPOC diagrams are used as tools for process improvement in the Six Sigma methodologies. Typically, they are deployed to make the process leaner and resource-optimized. This is because you can visually see the resources and manpower invested in a process through SIPOC diagrams.

Since Six Sigma practices aim at reducing the inconsistencies and defects of the outputs of a process, SIPOC also focuses on displaying every aspect of a process clearly. It helps you understand the interaction of tasks in an isolated process.

You can use a SIPOC diagram for the following purposes:

  • Keep the members of your team aligned in the same direction
  • Gain clarity of a process
  • Detailing a business process
  • Identifying individual components of a process

How Does a SIPOC Diagram Differ from a Workflow Diagram?

There are subtle differences between a workflow diagram and a SIPOC diagram. Workflow diagrams are the graphic representation of various business operations or processes.

A SIPOC diagram is a type of workflow diagram that focuses on a single process, defining and highlighting its finer details. Those details include sources, stakeholders, data, the information involved, and expected outputs.

Another key difference between a full-fledged workflow diagram and a SIPOC diagram is that workflow diagrams are chronologically mapped and help you see the interdependencies between various processes.

You won’t see any dependencies in a SIPOC diagram – it only reflects the isolated ecosystem of a single process.

What is the Importance of SIPOC Diagrams?

Certain processes in a business require more insights in order to be streamlined than others. For example, supply, procurement, shipping, warehouse and inventory management. For such processes, SIPOC diagrams prove to be of pivotal importance. Through these diagrams, you can gain insight into resource wastage and aim to optimize those areas.

Some processes require detailed delineation of goals, allocated resources, and input monitoring. A couple of examples would be invoicing and accounting. For these processes, SIPOC diagrams can provide in-depth insight and direction to help streamline their resource consumption and cycle times. This would help immensely in streamlining interdepartmental communication.

Since SIPOC diagrams display every aspect of a process right from the source to the customer, businesses can effectively study all the steps involved holistically. It then becomes easier to zero in on the parts of a process that can be improved or eliminated.

7 Simple Steps to Create a SIPOC Diagram

Listed below are 7 simple steps to build a SIPOC diagram:

1. Select a Process

The first step is to select a process for which you need the lean methodology of a SIPOC diagram. You can pick any process suitable for Six Sigma practices, for example, improving the shipping process of your product.

2. Define Your Process

Instead of starting with the 'S' (supplier) aspect of your process, start with the 'P' part. Define every action that takes place in your process. For example, from customer checkout to logistics, list every step in the shipping and delivery aspect.

3. Make a List of All Outputs

The third step is determining all the outputs your shipping process would create. In this case, there are two outcomes: the customer receives their package on time, and your business receives payment in exchange for the sale.

4. Identify Your End Users

In the fourth step, you need to identify the customers who would use the outputs of your process. They can be external or internal, depending on the nature of the output.

For the shipping process, the customers would be your company (for getting paid) and the online shoppers (who receive the product).

5. List the Inputs

This step may seem misplaced, but it is easier to list down the resource requirement once you know every action and task involved in a process.

Look at your process from end to end, and make a list of the resources needed to complete it.

6. List Down Your Suppliers

Once you have a list of the resources needed for the entire process, you need to list down your suppliers. For this shipping example, the suppliers would be:

  • Logistics partners
  • Customers for providing delivery details
  • Inventory and warehousing partners
  • Brand packaging vendor

7. Share the SIPOC Diagram

Once all the aspects of SIPOC are plotted, it is time to share them with all the stakeholders for their input and insight.

You can easily share the SIPOC diagram through a custom-made project management tool created on a no-code platform like Hubbler.

What are the Benefits of a SIPOC Diagram?

A SIPOC diagram comes with multiple benefits. Let’s understand in detail what they are.

Holistic Process Coverage

SIPOC diagrams are pivotal when executing role handovers. For anyone who is new to a business process, SIPOC diagrams can help gain a high-level view of every aspect involved in a process.

This way, the new stakeholder or process participant can instantly gain an in-depth understanding of the process and their own role in the ecosystem of that process.

Problem-Solving Assistance

In order for a business to function efficiently, it is essential to have a single source of truth for processes.

A SIPOC diagram can function as this source of truth and establish a common ground for all the stakeholders to come together and troubleshoot.

It helps prevent redundancies, errors, misunderstandings, miscommunication, delays, and a lot of other inconsistencies.

Process Mapping

A process map is a detailed representation of a process. A SIPOC can help you get started in marking the milestones that need to be populated with relevant information for the purpose of mapping.

For example, the “Suppliers” section can help you get started on the supply chain of a process, and the “Input” section on the resources needed.

Clarity

SIPOC diagrams embody clarity. These diagrams help you see at a glance who the vendors are, what they need to supply, what happens with these raw materials, who the concerned stakeholders are, and who are the end users of the finished product.

Sample SIPOC Diagram

Supplier Inputs Process Outputs Customer
Coffee Vendor Coffee beans/powder Loading the coffee machine with ingredients Coffee Owner
Coffee machine vendor Electricity/Gas Pushing the buttons Customer
Dairy vendor Dairy Placing the cups
Packed sugar vendor Sugar Serving the coffee
Utilities like gas and/or electricity Coffee Machine
Crockery and cutlery vendor Cups and spoons

 

[Created on computer]

By looking at the table, we can see that:

  • Each source of input is accounted for
  • All inputs are accounted for
  • The process steps are detailed
  • The output is clear
  • The end-user is also known

However, there is no timeline attached to a SIPOC diagram. The process of serving a customer at a café is isolated.

Working with SIPOCs in Hubbler

SIPOC diagrams are a significant help in situations where a process has confusing steps and too many touchpoints to properly account for.

Your business can benefit from sharing SIPOC diagrams through custom-created enterprise-level software.

Hubbler is a no-code platform that allows you to create efficient platforms for sharing SIPOC diagrams without writing any code. To learn more about Hubbler, book a demo today.

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