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SIPOC Diagram: The Ultimate Guide (with Templates)

Every organization that aims to grow and develop requires a reliable plan to actuate the same. In most cases, it is to build on their strengths and eliminate weaknesses. The characteristics of “strength” and “weakness” may seem industrially vague and subjective, but they rest on tangible results.

Lisa Anchalia

Every organization that aims to grow and develop requires a reliable plan to actuate the same. In most cases, it is to build on their strengths and eliminate weaknesses. The characteristics of “strength” and “weakness” may seem industrially vague and subjective, but they rest on tangible results. And in this pursuit of result-oriented excellence, businesses make use of several tools and methodologies to catalyze the desired outcomes. SIPOC diagrams are one such element of one of the most popular techniques - the Six Sigma approach.

In this post, we will review what a SIPOC diagram is and its associated benefits and challenges. At the end of the post, you can refer to the SIPOC templates that will aid you in implementing the tool within your organization. Let’s dive right in.

What is SIPOC?

As stated previously, SIPOC offers a high-level overview of any Six Sigma project. It is a type of process mapping that segments business processes into five key areas. Businesses can use the SIPOC diagram to define results, identify inefficiencies, and to improve operations. As a result, every stakeholder, from team members to high-level executives, will find themselves on the same page.

What is SIPOC?

SIPOC diagram is a tool that illustrates all the inputs and outputs for one or more processes in a tabulated form. SIPOC stands for:

  • Suppliers - the input provider in any process.
  • Inputs - raw materials, data, or resources required to complete the process.
  • Processes - proposed layout of actions that will convert the input into the desired output.
  • Outputs - goods or services arising out of the process.
  • Customers - the end-user or beneficiary who will receive the outputs.

While SIPOC is the standard acronym, some organizations resort to COPIS to indicate their customer-first approach.

How to create a SIPOC Diagram?

Once one understands the five primary components of the SIPOC diagram, constructing the SIPOC diagram can be a straightforward process. Start by creating a table containing five columns and name them Suppliers, Inputs, Process(es), Outputs, and Customers. Once done, follow the steps given below to create your very own SIPOC diagram:

SIPOC Step Approach

Step 1: Chalk Out the Process

Since you are creating the SIPOC diagram, you already know what process you need to examine at this point. Before you start with the first column of your SIPOC diagram, ensure that the starting and the ending points of the process are clearly defined.

Hence, start by writing the name of the process in the middle column and describe the workflow of the process in the bulleted form. Alternatively, you can name the process and draw a flowchart to define the steps involved. Do bear in mind that you do not have to get into the details of the steps involved and can stick to the basic outline.

Step 2: List the Outputs

Once you have outlined the process, you can now define the outputs expected from the process. To maintain clarity, stick to a maximum of three outputs to prioritize the ones that truly matter. Make use of nouns and maintain a neutral tone while listing the outputs as the goal is to avoid categorizing the outputs as “good” or “bad.”

Step 3: Identify the Customers

In this stage of drawing the SIPOC diagram, you need to focus on the people who will be impacted by the aforementioned outputs and processes.

The affected parties get classified as the “customer” for the process. By this definition, it becomes apparent that you do not consider the customer in the literal sense, but rather club anybody who will gain from the process or its resultant outputs. Similarly, you can also list those individuals who would be at a loss if the process were not to get completed.

Thus, an internal team gaining or losing from the efforts and outputs of another team would also qualify as a customer for the latter.

Step 4: Capture the Inputs Required

Every process requires a certain amount of inputs in the form of materials or information or resources to function properly. Thus, this section should cover the primary inputs that are necessary for the successful execution of the process. Ideally, four to six inputs would be sufficient to keep the team on track without any distractions.

Step 5: List the Suppliers

Finally, you can now move to your first column to identify and list the supplier of the inputs. Do pay attention to include the suppliers that bear a direct influence on the final output of the process. Hence, if the supplier bears any relation to the quality, quantity, or any other characteristics of your output, then you must include them as supplier too.

Simple Example of a SIPOC Diagram

Now that you have understood the whats and hows of SIPOC, here is a simple example to illustrate how you can create a SIPOC diagram:

Case: Starting a lemonade stall.

Source

Step 1: Process

Supplier Input Process Output Customers
  • Build a lemonade stand
  • Acquire material
  • Combine ingredients to make a pitcher of lemonade
  • Accept customer orders
  • Serve the lemonade

Step 2: Outputs

Supplier Input Process Output Customers
  • Build a lemonade stand
  • Acquire material
  • Combine ingredients to make a pitcher of lemonade
  • Accept customer orders
  • Serve the lemonade
  • A fresh and cold glass of lemonade
  • Accepting money in a jar

Step 3: Customers

Supplier Input Process Output Customers
  • Build a lemonade stand
  • Acquire material
  • Combine ingredients to make a pitcher of lemonade
  • Accept customer orders
  • Serve the lemonade
  • A fresh and cold glass of lemonade
  • Accepting money in a jar
  • Thirsty passerby

Step 4: Inputs

Supplier Input Process Output Customers
  • Customer order
  • Water
  • Lemon juice
  • Sugar
  • Ice cubes
  • A large pitcher
  • Stirring spoon
  • Money jar
  • Table to set up the lemonade kiosk
  • Busy roadside or pedestrian area
  • Build a lemonade stand
  • Acquire material
  • Combine ingredients to make a pitcher of lemonade
  • Accept customer orders
  • Serve the lemonade
  • A fresh and cold glass of lemonade
  • Accepting money in a jar
  • Thirsty passerby

Step 5: Suppliers

Supplier Input Process Output Customers
  • Home
  • Grocery stores
  • Customer requests
  • Customer order
  • Water
  • Lemon juice
  • Sugar
  • Ice cubes
  • A large pitcher
  • Stirring spoon
  • Money jar
  • Table to set up the lemonade kiosk
  • Busy roadside or pedestrian area
  • Build a lemonade stand
  • Acquire material
  • Combine ingredients to make a pitcher of lemonade
  • Accept customer orders
  • Serve the lemonade
  • A fresh and cold glass of lemonade
  • Accepting money in a jar
  • Thirsty passerby

Benefits of a SIPOC Diagram

Upon examining the SIPOC diagram of a lemonade stand above, the task of running a lemonade store becomes crystal clear. Plus, it offers ample room to scale the process in an agile manner if your lemon stand were to grow and expand. Thus, the primary advantages of a SIPOC diagram are obvious - it is critical for business process improvement.

Source

Hence, it comes as no surprise that SIPOC occupies the first two stages – Define and Measure – of the DMAIC stipulated in the Six Sigma Methodology.

Here are a few SIPOC benefits that are worth mentioning:

  • SIPOC is a consistent approach to analyzing and improving business processes. Additionally, it is also extremely easy to use, understand, and implement.
  • It acts as the starting point of reference for any process improvement process or transformation.
  • SIPOC benefits the organization by creating a collaborative team environment for better alignment.
  • It offers inputs for process documentation and creation of training material.
  • It grants a simple and high-level view of all the processes, the follow-up steps, and every element involved in the process.
  • SIPOC could potentially solve multiple challenges that businesses may

Challenges of SIPOC Diagram

While SIPOC is excellent in helping businesses, some common SIPOC challenges are as follows:

  • SIPOC is not a silver bullet to solve all your process-related issues. You will have to complement it with other techniques.
  • Since it is overly simplistic, it can only help with the basics of process mapping.
  • The quality of any SIPOC diagram largely depends on the people creating it. You may face greater SIPOC challenges if your team is incompetent or lacks the resources to create the SIPOC diagram.

Templates for SIPOC Diagram

You can utilize the SIPOC diagram in the followings applications:

  • For analyzing a process before transforming or improving it.
  • For briefing team members with the process and related elements.
  • For documenting processes after redefining them.
  • For developing SOPs, training material, or work instructions.

Here are a few SIPOC model examples to help you create a customized one for your business:

Automobile Repair Facility

Supplier Input Process Output Customers
  • Spare part supplier
  • Original parts and equipment manufacturer
  • Vehicle owner
  • Vehicle repair kit supplier
  • Customer representative
  • Work order
  • Requisition for repair
  • Vehicle to be repaired
  • Necessary parts for carrying out repairs
  • Diagnosing the problem
  • Sourcing the parts and equipment
  • Carrying out repairs
  • Notifying customer upon completion of service
  • Creating repair reports
  • Estimating costs
  • Deciding delivery timelines
  • Delivering a repaired vehicle
  • Notifying the customer through text message, email, telephone, etc.
  • Vehicle owner
  • Customer representative

Home Bakers’ Setup

Supplier Input Process Output Customers
  • Home baker
  • Grocery store
  • Delivery agent
  • Baked goods order from a customer
  • Recipe
  • Receipt acknowledging the sale
  • Baking supplies
  • Ingredients
  • Delivery
  • Accepting orders
  • Preparing the ingredients
  • Following the recipe to bake the goodies
  • Test the batch
  • Dispatching the order and notifying the customer
  • Successful purchase
  • Baked goods
  • Happy customer (and possibly referrals)
  • Individual who ordered the baked items
  • People who will consume baked goods

Final Thoughts

A SIPOC diagram plays an instrumental role in process mapping and business process improvement. Since it strips away the complexities, it makes it easier for even a layman to understand the nuances within any organization. Since it can improve the chances of your project’s success, why not give SIPOC a try?

General

Lisa Anchalia

I'm a consultant with 4+ years of business experience in the field of sports planning, manufacturing, accounting, economics & research. I occasionally write articles for Breakout.