Skill level: Basic
The suppliers, inputs, process, outputs, customers (SIPOC) diagram defines the scope of work for a team and identifies at a high level the potential gaps (deficiencies) between what a process expects from its suppliers and what customers expect from the process.
A SIPOC diagram maps a process at a high level and identifies potential gaps between suppliers and inputs specifications and between outputs specifications and customers expectations, thus defining the scope for process improvement activities.
Because it also identifies feedback and feed-forward loops between customers, suppliers, and the process, it jump-starts the team to begin thinking in terms of cause and effect.
- Enables all team members to view the process in the same light
- Visually communicates the process at a high level and defines the scope of improvement efforts
- The first step in cause-and-effect thinking; contributes to understanding how the suppliers, inputs, process steps, and outputs affect customer(s) needs
- Begins to identify gaps such as:
- Inputs we don’t need but receive
- Outputs that customers don’t want, but receive anyway
- Process steps that are completed, but add no value
How to Use
- Step 1. Name the process. (Use verbs/adjectives.)
Step 2. Indicate the start/stop, or the scope of the process. (What are the triggers that initiate and end the process?)
- Step 3. Indicate the output(s) of the process. (Use nouns – what is it this process does?)
- Step 4. Indicate the customer(s) of the process. (Whom does this process affect/benefit?)
- Step 5. Indicate the supplier(s) of the process. (Which individuals/teams provide inputs into this process?)
- Step 6. Indicate the input(s) of the process. (Use nouns – what is needed to execute this process and deliver the outputs?)
- Step 7. Indicate the five to seven highest-level steps in the process as they exist today. (Use verb/adjectives – how does this process operate?)
SIPOC: A mnemonic device that helps teams process map. “SIPOC” stands for …
- S – The Supplier(s) to a process
- I – The Input(s) provided by suppliers to a process
- P – The high-level Process steps within the overall project, normally five to seven steps at this level of mapping
- O – The Output(s) of the process
- C – The Customer(s) of the process
The SIPOC below maps the month-end close process of a financial institution.
Throughout the month, financial data are loaded to the general ledger via multiple sources. Once the end of the calendar month occurs, other pertinent data, such as credit information, are then loaded to the ledger.
Data from prior periods are analyzed to determine net impact of the current month. This knowledge is then communicated at close meetings so that leadership can determine critical decisions, such as what amount to put in reserves, how to adjust forecasts, etc.
Potential data changes are reviewed and approved by the corporate accounting group prior to the final version of the data being reported and delivered to the CEO.