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OliveOilexport.docxRunning head: SIX SIGMA 1
SIX SIGMA 7
Olive Oil export
Name
Institution
Olive Oil export
The global market of olive oil has undergone dramatic change. With the introduction of the new economic wave, the price of the olive oil has been reduced by more than half leading to the critical condition. The lower prices are not the only concern. Spain is known to be one of the leading olive oil exporters. Their dominance in the olive oil exportation makes them have huge influence on the exportation of oil. The manufacturers of the cheap corn and soybean oils have also entered the market through launching of massive advertising campaigns. The good thing about the olive oil export will not affect Russian olive oil market. The Russian olive oil continues to present themselves in the supermarket shelves, and the lower prices are no on the horizon. There are high chances that the market will continue to grow (Putinja, 2017).
Six sigma provides the initiative to increase profitability and improve margins. Success can be achieved when the six-sigma initiative become strategy driven, process focused and the project enabled. The six sigma is effective for the olive oil export business out of Russia in that it will improve the company’s margin quality and efficiency. The sigma will incorporate an integrated strategy and project elements. The six sigmas’ can effectively track quality improvements on profitability and one can easily know the changes that need to be made in order to improve the profit margins (Niklis, Baourakis, Thabet & Manthoulis, 2014).
Six sigmas’ is effective for the Olive oil export in that it reduces the defects that are associated in any process. Like all the existing businesses, the major motive of the oil export process is to satisfy customers and make profit. This will only be achieved through reducing the defects present in the process of exportation. Reduction of the defects will enable the business produce more products and increase its profit. The reduction of variation in the olive oil exportation would enable the company to provide a product or service as per the needs of customer needs (Radinovsky, 2016).
Olive oil market continue to experience fluctuations due to the unpredictable yields and extreme weather conditions mostly in Europe and is something which is an advantage for Russian based company. Most countries in Europe have come up with attempts to address the issues through adopting the risk-management instrument. The other initiatives that have been taken include the tackling of food fraud and disputes upon the application of commercial rules and strengthen competitively.
The six sigma consists of two methodological approach that will enable the company to be efficient. The first is the DMAIC which contains define measure analyze, improve and control. This would be best for enabling the company to improve on the existing process. This methodology allows the company to first begin by identifying the problem. The impact that could arise from the problem is the measured and the root cause of the problem being analyzed. The next step involves the elimination of the root cause of the problem and the process control so it does not go back to the previous state (Radinovsky, 2016).
The six sigma offers the company with second methodology option which aims to define measure analyze, design and verify. This methodology in the six-sigma design will enable one to design the new process in a way that does not allow the variation to exist. In this methodology the problem is identified, the impact of the problem and the root cause of the problem analyzed. The system is designed in a manner that allows for the elimination of the identified problem (Putinja, 2017).
The six sigma methodologies increase effectiveness in each process which is a good thing for the oil export process for other countries. The target might not be achieved overnight or in a single process. The six sigma’s focus on the customer requirements which is the key to success in the olive oil export business. The first step in the six sigma involves defining the quality from the view of customers. Each customer has a different definition of quality-something important for olive oil export. The company needs to measure quality in the manner in which its customers do. Through addressing the needs of the customer, the company is able to define the quality of the customer. Looking to the future the report forecasts that the olive production is set to rise, especially in Spain where growth is expected to increase by 10% by 2026. Italy is expected to decline its production by 1%. In terms of the international trade, exports are predicted to rise by over 45% in the next seven years (Radinovsky, 2016).
Six sigma uses data to identify the variation in the process. The variations in the process are majorly categorized into two; special cause variation and natural variation. The special cause variations are normally caused by external factors while the natural variations are process generated. Adoption of the six sigma enables the company to reduce special cause variations. This is managed through effective identification of the variation and regarding the process as being necessary. One should be able to have a deep understanding of the process. It would be difficult to gain knowledge of the process if not studied. The process can be well understood through understanding of the process which involves clearly defining goals for data collection, and establishing an effective data collection plan. The collected data would be used to acquire knowledge to meet the objectives that were set up. The collected data will help to eliminate variations in the existing collected data (Henshall, 2018).
Upon identification of the root causes of variation, the six sigma enables the company to make changes to eliminate variations in the process. Elimination of the variations enables the company to remove the defects associated with oil exportation. This will also enable the company to remove the steps that do not add any value to the customer. This is key to success for olive oil export in that it will help eliminate the waste in the process. The company will not be forced to wait for the variation to show itself. The company will be involved in the collection of data, talking to people and studying the data to identify variations in the process. The variations could have become the routine in that it is the way people have always done things (Lucidchart content team, 2018).
Six sigma required adaptability from various points of view. It is important the company’s management r acknowledges the positive changes. It is essential for the people to be motivated to accept the changes in the system to eliminate the variation. The employees should remain motivated and know the benefits that are associated with the adoption of the six sigmas. The six sigma provides understanding to all the aspects of the process which involves the stakeholders and the methods involved and is key to ensuring that any new or updated process works (Joel, 2019).
Six sigma provides a popular approach for the process management in that it provides means to improve business process. It is centrally a customer and product-driven approach. Ti majorly aims to avoid waste and deliver a product that meet all the customer requirements. In order to accurately analyze the process, there is need to collect precise data. The outcome of adopting the six sigmas’ include increased quality, high customer satisfaction, improved employee morale and provision of efficient working environment (Celegato, 2017).
References
Bayramer, G., Tunalioglu, R. and Karatas-Ozkan, M. (2018). Perspective of exporters in Turkey: problems in olive oil exports. Acta Hortic. 1199, 171176DOI: 10.17660/ActaHortic.2018.1199.28https://doi.org/10.17660/ActaHortic.2018 .1199.28
Celegato, A (2017). "IN MEMORY OF EGIDIO CASCINI" (PDF). Statistica Applicata - Italian Journal of Applied Statistics Vol. 29: 107–110
Henshall, A. (2018). The 7 core sigma principles to build your business around. Process.st https://www.process.st/six-sigma-principles/
Joel, A. (2019). The key principles of six sigma: what are they and why are they important? GreyCampus. https://www.greycampus.com/blog/quality-management/principles-of-six- sigma
Lucidchart content team, (2018). 5 lean sigma principles you should adopt immediately. Lucidchart https://www.lucidchart.com/blog/lean-six-sigma-principles
Putinja, I. (2017). EU report predicts 45-percent increase in olive oil exports by 2026. OliveoilTimes https://www.oliveoiltimes.com/business/eu-report-predicts-45-percent- increase-olive-oil-exports-2026/59167
Radinovsky, L. (2016). The olive oil sector’s prospects, challenges, and future. Greek liquid gold. http://www.greekliquidgold.com/index.php/en/news/192-the-olive-oil-sector-s- prospects-challenges-and-future
