Six sigma an overview | Online Mini MBA (Free)

CONTENTS
A
• Why: Six Sigma
B
• What: Six Sigma
C
• How: Six Sigma
D
• 6σ Project: Using DMAIC
FOUR
SECTIONS

Why 6σ: An Example !!
• Customers want their pizza
delivered fast!
• Guarantee = “30 minutes or less”
• What if we measured performance and found an
average delivery time of 23.5 minutes?
– On-time performance is great, right?
– Our customers must be happy with us, right?

How often are we delivering on time?
Answer: Look at the variation!
• Managing by the average doesn‟t tell the whole story. The
average and the variation together show what‟s happening.
s
x
30 min. or less
0 10 20 30 40 50

Reduce Variation to Improve Performance
How many standard
deviations can you
“fit” within customer
expectations?
• Sigma level measures how often we meet (or fail to meet)
the requirement(s) of our customer(s).
s
x
30 min. or less
0 10 20 30 40 50

Variation  Customer: The Relation
• Variation means that a
process does not produce
the same result (the “Y”)
every time.
• Some variation will exist in
all processes.
• Variation directly affects customer experiences.
Customers do not look at averages!
-10
-5
0
5
10
15
20

Six Sigma: Purpose
A scientific and practical method to achieve
improvements in a company
Scientific:
• Structured approach.
• Assuming quantitative data.
Practical:
• Emphasis on financial result.
• Start with the voice of the customer.
“Show me
the data”
”Show me
the money”

Six Sigma: Advantage
Sigma
Level
Defects Per Million
Opportunities
Rate of
Improvement
1  690,000
2  308,000 2 times
3  66,800 5 times
4  6,210 11 times
5  230 27 times
6  3.4 68 times

99.99966% Good (6 Sigma)
• 20,000 lost articles of mail per
hour
• Unsafe drinking water for
almost 15 minutes each day
• 5,000 incorrect surgical
operations per week
• Two short or long landings at
most major airports each day
• 200,000 wrong drug
prescriptions each year
• No electricity for almost seven
hours each month
• Seven articles lost per hour
• One unsafe minute every seven
months
• 1.7 incorrect operations per week
• One short or long landing every
five years
• 68 wrong prescriptions per year
• One hour without electricity
every 34 years
99% Good (3.8 Sigma)
Six Sigma: Practical Meaning

• The term “Six Sigma” was coined by Bill Smith, an engineer with Motorola
• Late 1970s - Motorola started experimenting with problem solving through
statistical analysis
• 1987 - Motorola officially launched it’s Six Sigma program
Origin of Six Sigma
Motorola
the company that invented Six Sigma

What‟s in a name ?
μ
σ
• Sigma is the Greek letter representing the standard
deviation of a population of data.
• Sigma is a measure
of variation
(the data spread)

Six Sigma: Definition
Six Sigma – The 3 Distinct Elements
• A Measure:
– A Statistical definition of how far a process deviates from perfection
• A Target:
– 3.4 defects per million opportunities
• A Philosophy:
– A long term business strategy focused on the reduction of the cost
through reduction of variability in product & process

Six Sigma: Constrains
y
x
Poor Design
Changing Needs
Measurement System
Insufficient Process
Capability
Skills & Behaviors

• Characterize
• Optimize
• Breakthrough
USL
T
LSL
USL
T
LSL
T
USLLSL
USL’LSL’
Six Sigma: Focus
Customer Focused - Both Internally & Externally

Six Sigma: Reality
• Six Sigma through the correct application of
statistical tools can reap a company enormous
rewards that will have a positive effect for
years
Or
• Six Sigma can be a dismal failure if not used
correctly

Six Sigma: Spotlight
• Accelerating fast breakthrough performance
• Significant financial results in 4-8 months
• Ensuring Six Sigma is an extension of the
Corporate culture, not the program of month
• Results first, then culture change!

Six Sigma: Reason for Success
• The Success at Motorola, GE and
AlliedSignal has been attributed to:
– Strong leadership (Bob Galvin, Jack Welch and
Larry Bossidy personally involved)
– Initial focus on operations
– Aggressive project selection (potential savings in
cost of poor quality > $50,000/year)
– Training the right people

Six Sigma: Normal Distribution
+/ - 3 
+/ - 6 
LSL USL
ppm
0.001
ppm
1350
ppm
1350
ppm
0.001
Tolerance
Target = m

Six Sigma: Distribution With Correction
LSL
0 ppm ppm
3.4
1.5
USL
ppm
3.4ppm
66803
m
+/- 6
Tolerance
• Six-Sigma allows for un-foreseen „problems‟ and longer
term issues when calculating failure error or re-work rates
• Allows for a +/- 1.5 σ process „shift‟

Six Sigma – 3 Dimension
ToolsOrganization
Methodology
Process variation
LSL US
L
Upper/Lower
specification
limits
Regression
•••••••
•••••
•••••••
•••••
•••
•
••
Driven
by
customer
needs
Enabled by quality
team.
Led by
Senior
Mgmt
Define Measure Analyze Improve Control
VendorVendorProcess BProcess BProcess AProcess ACustomerCustomer VendorVendorProcess BProcess BProcess AProcess ACustomerCustomer
Process Map Analysis
0
5
10
15
20
25
30
35
L K A F B C G R D
0%
20%
40%
60%
80%
100%
Frequency Cumulative Frequency
Pareto Chart

Six Sigma: Focus Area
Process Management helps
us maintain good results
as we perform our
Mission.
Strategic planning helps us “focus”
on key projects to reach our
Vision.
Process Improvement using
the DMAIC process helps
us fix work problems and
improve our
Performance.
To be successful as an organization, we must learn how to
effectively apply ALL three (3) areas.
Strategic
Planning
Process
Improvement
Process
Management
Six Sigma

Two components of Six Sigma
1. Process Power
2. People Power

Design For Six Sigma (DFSS): DMADV
• 6 Sigma uses DMADV method for development of new
products
• Define design goals that are consistent with customer demands and the
enterprise strategy.
• Measure and identify CTQs
• Analyze to develop and design alternatives,
• Design details, optimize the design,
• Verify the design, set up pilot runs, implement the production process

What is DFSS?
• Design For Six Sigma (DFSS)
– A rigorous approach to the design of a new product or
service
– The goals:
• Reduce delivery time and development cost and
• Increase the effectiveness of the product or service and hence
customer satisfaction.
– Key elements:
• A customer focus and the ability to measure quality using the six
sigma metric and philosophy
• Appropriate design that delivers excitement without failure, and
does so to budget and expectation
• An overarching business strategy and management that brings out
the very best for organic growth, through the repeated and regular
launch and successful development of new products and services

DMAIC - Simplified
• Define
– What is important?
• Measure
– How are we doing?
• Analyze
– What is wrong?
• Improve
– Fix what‟s wrong
• Control
– Ensure gains are maintained to
guarantee performance
• A logical and structured approach to
problem solving and process
improvement
• An iterative process (continuous
improvement)
• A quality tool with focus on change
management

Six Sigma: DMAIC
Process Improvement
utilizes a 5 step problem
solving DMAIC process:
2) Measure
5) Control
4) Improve
1) Define
3) Analyze
Display Problem ...
WHAT
WHERE
WHEN
WHO
OUTCOME
Stratify Problem ...
1. Define 2. Measure
3. Analyze 4. Improve
Results Standardization Future Plans
Checksheet
or Spreadsheet Line Graph
Month
GOOD
Target
GAP
%
Histogram
n=63
21 Late
n=21
Pareto
B C A D
PROBLEM STATEMENT
Identify & Verify Root Cause ... Identify & Implement Countermeasures ...
Countermeasures MatrixSingle Case Bore Contingency Table
FISHBONE
REASON/
FACTORA
B
C
1
CASE
2 3 4 5 A
Present
A
Absent
EffectCause
Problem
No
Problem
35 3
4 25
A
Scatter Diagram
Cause "C"
Effect
B
E
F
F
E
C
T
PROBLEM
STATEMENT
ROOT
CAUSE
A
C
A1
A2
C1
C2
4 4 16 Y
5 4 20 Y
3 1 3 N
EFF
FEAS
OVRL
ACTN?
3 2 6 N
CM
BARRIERS AIDS
High A1a A1b
HOW WHO
1. Dev
2. Impl
WHEN
CONTROL CHARTS
FLOW CHART
LESSONS LEARNED
WHAT'S NEXT?
GOOD
%
CM IMPL'M
Before After
n=21
n=10
OverallEffect
B C A D C B A D
Target
Standard
Action Plan
5. Control
4. Improve

Focus of Six Sigma
• Y
• Dependent
• Output
• Effect
• Symptom
• Monitor
• X1 . . . Xn
• Independent
• Input-Process
• Cause
• Problem
• Control
f(X)Y=
The focus of Six sigma is to identify and control Xs

Path to Six Sigma
Y
Xs
Measure
Analyze
Improve
Control
Process
Characterization
Process
Optimization
Goal: Y = f ( x )
DefinePractical Problem
Statistical Problem
Statistical Solution
Practical Solution

The Approach to DMAIC
Practical
Problem
Statistical
Problem
Statistical
Solution
Practical
Solution

Methodology
D
Define
M
Measure
A
Analyze
I
Improve
C
Control
Identify and state the practical problem
Validate the practical problem by collecting data
Convert the practical problem to a statistical one, define
statistical goal and identify potential statistical solution
Confirm and test the statistical solution
Convert the statistical solution to a practical solution

Define
VoC - Who wants the project and why ?
The scope of project / improvement
Key team members / resources for the project
Critical milestones and stakeholder review
Budget allocation
D
Define
M
Measure
A
Analyze
I
Improve
C
Control

Measure
Ensure measurement system reliability
Prepare data collection plan
- Is tool used to measure the output variable flawed ?
- Do all operators interpret the tool reading in the same way ?
- How many data points do you need to collect ?
- How many days do you need to collect data for ?
- What is the sampling strategy ?
- Who will collect data and how will data get stored ?
- What could the potential drivers of variation be ?
D
Define
M
Measure
A
Analyze
I
Improve
C
Control Collect data

Analyze
Understand statistical problem
Baseline current process capability
Define statistical improvement goal
Identify drivers of variation (significant factors)
D
Define
M
Measure
A
Analyze
I
Improve
C
Control

Analyze – Identify Drivers of Variation
Root Cause Analysis (fish bone)
• A brainstorming tool that helps define and display major causes, sub causes and
root causes that influence a process
• Visualize the potential relationship between causes which may be creating
problems or defects
ProblemBackbone
Primary Cause
Secondary Cause
Root Cause

Control – Impact Matrix
• A visual tool that helps in separating the vital few from the trivial many
Vital Few
High Control – High Impact
Cost Ineffective
Low Control – High Impact
Cost Ineffective
High Control – Low Impact
Trivial Many
Low Control – Low Impact
Control
Impact

Pareto Chart
• Pareto principle states that disproportionately large percentage of defects are
caused due to relatively fewer factors (generally, 80% defects are caused by 20%
factors)
0
5
10
15
20
25
30
35
L K A F B C G R D
0%
20%
40%
60%
80%
100%
Frequency Cumulative Frequency

Process Map Analysis
• Visually highlights hand off points / working relationships between
people, processes and organizations
• Helps identify rework loops and non value add steps
VendorVendorProcess BProcess BProcess AProcess ACustomerCustomer VendorVendorProcess BProcess BProcess AProcess ACustomerCustomer

Improve
Map improved process
Pilot solution
Identify operating tolerance on significant factors
D
Define
M
Measure
A
Analyze
I
Improve
C
Control

Control
Ensure measurement system reliability for
significant factors
Improved process capability
Sustenance Plan
- Is tool used to measure the input / process variables flawed ?
- Do all operators interpret the tool reading in the same way ?
- Statistical Process Control (SPC)
- Mistake Proofing
- Control Plan
D
Define
M
Measure
A
Analyze
I
Improve
C
Control

Six Sigma: People Power
• High Level Executive committed to Six Sigma Success
• Knowledgeable in Six Sigma Process
• Assign key individuals to the Champion/Sponsor Position.
• High Level Executive
• Provide resources for the job
• Assist Black Belts to select projects
• Benchmark with other organizations
• Resource for the Black Belts-experts
• Experts on the Six Sigma process
• Works with Champion to select projects
• Leaders of the Six Sigma process
• Bring the project vision to reality
• Solely dedicated to Six Sigma Program
• Oversee Green Belts
• Project Leaders
• Support the Black Belt to complete the project
Executive Leader
Champion/Sponsor
Master Black Belt
Black Belt
Green Belt Green Belt Green Belt

Six Sigma: A Project
Customer Satisfaction
Through
Claim Amount
D
Define
M
Measure
A
Analyze
I
Improve
C
Control

D
Define
M
Measure
A
Analyze
I
Improve
C
Control
Strong Relationship (10)
Some Relationship (5)
Weak relationship (2)
No mark, no relationship (0)
Relative importance
S NO
1 10
2 10
3 8
4 5
5 10
70 150 200 70 150 150 150
3 2 1 3 2 2 2
RELATIONSHIPS
CUSTOMER NEEDS
Absolute
Relative
Driveability Issue
Safety Features Functioning
Part Availability Based On Order
Good Exterior Look
No Rust of Parts
< 100
Technical
Importance
Target Value
Paintquality
Partspecerror
Partmiss
Forwarddriving
gear
Reversedriving
gear
ABS
Airbag
Quality Function Deployment (QFD)
For Customer Problems

S. N CUSTOMER PROBLEM CNT
CLAIM AMT
/ COUNT
TOTAL
CLAIM AMT
1 ABS unit not working 10 $ 300 $ 3000
2 Reverse gear slippage at 30 kph 5 $ 200 $ 1000
3 Paint claims 10 $ 100 $ 1000
4 No air bag label (spec error) 50 $ 10 $ 500
5 Sun visor spec error 5 $ 50 $ 250
TOTAL $ 5750
TOTAL CLAIM AMOUNT
1
2
3
4
5
Top – 5
Claim
Details
D
Define
M
Measure
A
Analyze
I
Improve
C
Control

D
Define
M
Measure
A
Analyze
I
Improve
C
Control
Cause & Effect Diagram
(Fish Borne Diagram)
All the Top-5 Problems
(as per QFD) have been
analyzed through Cause
& Effect Diagram (Fish
Borne Diagram).

D
Define
M
Measure
A
Analyze
I
Improve
C
Control

D
Define
M
Measure
A
Analyze
I
Improve
C
Control
• Changing machine procedure to incorporate ABS option in Roll &
Brake machine. (Refer Annexure – A)
• Incorporating Reverse gear checking method at Road Test. (Refer
Annexure – B)
• Creating work standard for all areas to avoid miss outs. (Refer
Annexure – C)
• Training procedure & skill requirement for all areas to identify skill
level of technicians. (Refer Annexure – D)

D
Define
M
Measure
A
Analyze
I
Improve
C
Control
Refer Annexure – E
(Creating Mistake proofs / Updating Work standard for all areas to avoid
miss outs)
Based on the work standard, training given to all technicians who are
working in the designated area. Also in the control plan, multi-inspection
mentioned in some areas to avoid miss out.

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Six sigma an overview | Online Mini MBA (Free)

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