Six Sigma Better Known As y = f(x) + e

Hi Warriors I hope you find this post useful and that it gets you to thinking.

I've been working more and more on my business processes and such lately so as to not leave anything to chance and to leverage my ability to make money online by finding the optimal processes to work with.

In my search I came across a for dummies book on a subject that I skimmed when I was a machine operator for a manufacturing company. The dummies book is about a strategy called Six Sigma.

For those of you who haven't heard of Six Sigma, it's sorta like all the online metrics programs (Google included) put on steroids, really.

Anyway, I've been reading the Six Sigma for Dummies book that I ordered from Ebay and the idea struck me that online processes seem ideal for this tactic.

As a brief overview of my thinking, let me state the core principle of Six Sigma, which is called determinism and is represented by the following expression of: y = f(x) + e

In the expression: y = f(x) + e

Y stands for the outputs or results of a process. F stands for a transformation process and X stands for the input variables of the process. Last but most importantly, E represents the error or potential for variation in each process.

Basically put (without the variation) if you have X input and transform it with F process you will get Y result.

The E comes in when you realize that the Y is not the same each time the process is run and this is what Six Sigma is mostly based on as far as I understand it, meaning, eliminating as much variation in a viable process to control the inputs better which in effect makes the transformation process more effective, thus increasing the probability of you hitting your desired output, within a certain median of error.

I hope everyone is following me so far. If not, don't worry, I'm having a headache thinking like this and I just started reading this book today an am only on page 41 - Chapter 3.

After getting this far in the book, I started thinking in terms of my online business ventures and how the y = f(x) + e has been affecting it.

After twiddling around for a bit, I came up with the following which I hope will help others looking to create processes understand just how important it is to understand each and every measurable aspect of their online business.

Here Goes...


[{y this is your sales} = {f this is your market presentation (x) this is your product} + {e} this is your costs]

How do you like that so far?

Okay, from the top down.

Y - Your Sales is affected by the following variation:

1. Your initial offering which is usually a loss leader
2. Your front end product
3. Your OTO
4. Your Backend product
5. Your continuity program
6. Your product length
7. Your product breadth

F - Your Market presentation is affected by the following variation:

1. Short copy
2. Long copy
3. Price point
4. Social proof
5. Perceived value
6. Marketing efforts
7. Leverage
8. Trust issues
9. Guarantees

X - Your product is affected by the following variation:

1. Need
2. Market research
3. Whether your product is an information product or a solution
4. Whether your product is digital or physical

E - Your initial variation per process is affected by the following variate costs

1. Time
2. Knowledge
3. Capital

After I finished writing this, I sat back a took a look and all I could think was that this is a lot of stuff to be running metrics on and we haven't even covered VOC or the voice of the customer which will tell you what to create and how much to sell it for.

I hope everyone found this an interesting exercise in thinking metrically about their business and I truly look forward to all comments, especially from those who are experts in this field that I have realized, we all need to learn about in order to truly be successful with our online ventures.