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SIX SIGMA
- 1. INTRODUCTION TO SIX SIGMA HAWTHORN 6SIGMA QUALITY SOLUTIONS [email_address] [email_address] [email_address] WWW.HSQS.IN
- 3. What is Six Sigma ? The term " Sigma " is used to designate the distribution or spread about the mean (average) of any process or procedure. For a business or manufacturing process, the sigma value is a metric that indicates how well that process is performing. The higher the sigma value, the better. Sigma measures the capability of the process to perform defect-free-work. A defect is anything that results in customer dissatisfaction.
- 4. With Sig Sigma, the common measurement index is "defects-per-unit," where a unit can be virtually anything--- a component, piece of material, line of code, administrative form, time frame, distance, etc. The Sigma value indicates how often defects are likely to occur. The higher the sigma value, the less likely a process will produce defects. As sigma increases, costs go down, cycle time goes down, and customer satisfaction goes up. What is Six Sigma … ?
- 12. MANAGING UP THE SIGMA SCALE Sigma % Good % Bad DPMO 1 30.9% 69.1% 691,462 2 69.1% 30.9% 308,538 3 93.3% 6.7% 66,807 4 99.38% 0.62% 6,210 5 99.977% 0.023% 233 6 99.9997% 0.00034% 3.4
- 15. THE SIX SIGMA EVOLUTIONARY TIMELINE 1736 : French mathematician Abraham de Moivre publishes an article introducing the normal curve. 1896 : Italian sociologist Vilfredo Alfredo Pareto introduces the 80/20 rule and the Pareto distribution in Cours d’Economie Politique . 1924 : Walter A. Shewhart introduces the control chart and the distinction of special vs. common cause variation as contributors to process problems. 1941 : Alex Osborn, head of BBDO Advertising, fathers a widely-adopted set of rules for “brainstorming”. 1949 : U. S. DOD issues Military Procedure MIL-P-1629, Procedures for Performing a Failure Mode Effects and Criticality Analysis . 1960 : Kaoru Ishikawa introduces his now famous cause-and-effect diagram. 1818 : Gauss uses the normal curve to explore the mathematics of error analysis for measurement, probability analysis, and hypothesis testing. 1970s : Dr. Noriaki Kano introduces his two-dimensional quality model and the three types of quality. 1986 : Bill Smith, a senior engineer and scientist introduces the concept of Six Sigma at Motorola 1994 : Larry Bossidy launches Six Sigma at Allied Signal. 1995 : Jack Welch launches Six Sigma at GE.
- 17. SIX SIGMA AND FINANCIAL SERVICES
- 21. DEFINE – CUSTOMER REQUIREMENTS WHAT ARE THE CTQS? WHAT MOTIVATES THE CUSTOMER? Voice of the Customer Key Customer Issue Critical to Quality SECONDARY RESEARCH PRIMARY RESEARCH Surveys OTM Industry Intel Listening Posts Market Data Industry Benchmarking Focus Groups Customer Service Customer Correspondence Obser-vations
- 23. ANALYZE – POTENTIAL ROOT CAUSES WHAT AFFECTS OUR PROCESS? y = f (x 1 , x 2 , x 3 . . . x n ) Ishikawa Diagram (Fishbone) Six Sigma
- 24. ANALYZE – VALIDATED ROOT CAUSES WHAT ARE THE KEY ROOT CAUSES? y = f (x 1 , x 2 , x 3 . . . x n ) Critical Xs Process Simulation Data Stratification Regression Analysis Six Sigma
- 26. IMPROVE – SOLUTION SELECTION HOW DO WE CHOOSE THE BEST SOLUTION? Solution Implementation Plan Solution Selection Matrix Solution Sigma Time CBA Other Score Time Quality Cost Six Sigma ☺ Nice Try Nice Idea X Solution Right Wrong Implementation Bad Good
Editor's Notes
- © 2003 FleetBoston Financial Page
- © 2003 FleetBoston Financial Page
- As a metric As a methodology As a management system Essentially, Six Sigma is all three at the same time." "...Six Sigma as a Metric: The term "Sigma" is often used as a scale for levels of 'goodness' or quality. Using this scale, 'Six Sigma' equates to 3.4 defects per one million opportunities (DPMO). Therefore, Six Sigma started as a defect reduction effort in manufacturing and was then applied to other business processes for the same purpose.." "...Six Sigma as a Methodology: As Six Sigma has evolved, there has been less emphasis on the literal definition of 3.4 DPMO, or counting defects in products and processes. Six Sigma is a business improvement methodology that focuses an organization on: Understanding and managing customer requirements Aligning key business processes to achieve those requirements Utilizing rigorous data analysis to minimize variation in those processes Driving rapid and sustainable improvement to business processes..“ "...Six Sigma Management System: Through experience, Motorola has learned that disciplined use of metrics and application of the methodology is still not enough to drive desired breakthrough improvements and results that are sustainable over time. For greatest impact, Motorola ensures that process metrics and structured methodology are applied to improvement opportunities that are directly linked to the organizational strategy. When practiced as a management system, Six Sigma is a high performance system for executing business strategy. Six Sigma is a top-down solution to help organizations: Align their business strategy to critical improvement efforts Mobilize teams to attack high impact projects Accelerate improved business results Govern efforts to ensure improvements are sustained.." "..The Six Sigma Management System drives clarity around the business strategy and the metrics that most reflect success with that strategy. It provides the framework to prioritize resources for projects that will improve the metrics, and it leverages leaders who will manage the efforts for rapid, sustainable, and improved business results..“ © 2003 FleetBoston Financial Page
- First and simply, Six Sigma is a quality improvement methodology. © 2003 FleetBoston Financial Page
- Six Sigma was then (1980’s) simply a statistical term that specifically referred to a performance target of 3.4 defects per million operations or 'opportunities' (DPMO). © 2003 FleetBoston Financial Page
- Six Sigma is a very flexible concept. © 2003 FleetBoston Financial Page
- It shows how much variation or "dispersion" there is from the average (mean, or expected value). A low standard deviation indicates that the data points tend to be very close to the mean, whereas high standard deviation indicates that the data are spread out over a large range of values. Square root of difference of each data point from the mean, divided by no of data points. What is the definition of variation? A difference between two or more similar things. © 2003 FleetBoston Financial Page
- © 2003 FleetBoston Financial Page
- During the mid to late 1980's Motorola developed its Six Sigma ideas, which extended to and embraced many existing quality improvement methods and tools. Motorola quickly realised that they could extend Six Sigma principles beyond manufacturing - to reduce variation and defects in all aspects of organizational performance. Following Motorola's success in defining and applying the Six Sigma methodology, Six Sigma became a transferable model. The early adopters of Six Sigma aside from Motorola were Allied Signal (a large avionics company which merged with Honeywell in 1999), and then more significantly the massive GE (General Electric) corporation; (according to most commentators the Six Sigma model was transferred between the Chief Executives of the respective organizations). GE particularly trumpeted its successes and multi-billion dollars of bottom-line improvements derived from Six Sigma, and by the end of the millennium Six Sigma was established as a mainstream management methodology, and had been adopted by very many of the world's largest corporations. Strictly speaking the Six Sigma brand is trade-marked in the USA and belongs to Motorola Inc.. Motorola has since developed its own accredited, certified services and training for Six Sigma, within what is called the 'Motorola University'. Six Sigma is very flexible, and it continues to evolve, and it's difficult to describe. © 2003 FleetBoston Financial Page
- © 2003 FleetBoston Financial Page
- six sigma DMAIC and DMAICT process elements D - Define opportunity M - Measure performance A - Analyse opportunity I - Improve performance C - Control performance, and optionally: T - Transfer best practice (to spread the learning to other areas of the organization) © 2003 FleetBoston Financial Page
- CTQ - Critical To Quality - An element within a process that has a major influence on the process quality, and typically the quality of a critical process, or it would be unlikely to be receiving Six Sigma attention. © 2003 FleetBoston Financial Page
- © 2003 FleetBoston Financial Page
- Six Sigma identifies several key roles for its successful implementation.[13] Executive Leadership includes the CEO and other members of top management. They are responsible for setting up a vision for Six Sigma implementation. They also empower the other role holders with the freedom and resources to explore new ideas for breakthrough improvements. Champions take responsibility for Six Sigma implementation across the organization in an integrated manner. The Executive Leadership draws them from upper management. Champions also act as mentors to Black Belts. © 2003 FleetBoston Financial Page
- Master Black Belts, identified by champions, act as in-house coaches on Six Sigma. They devote 100% of their time to Six Sigma. They assist champions and guide Black Belts and Green Belts. Apart from statistical tasks, they spend their time on ensuring consistent application of Six Sigma across various functions and departments. Black Belts operate under Master Black Belts to apply Six Sigma methodology to specific projects. They devote 100% of their time to Six Sigma. They primarily focus on Six Sigma project execution, whereas Champions and Master Black Belts focus on identifying projects/functions for Six Sigma. © 2003 FleetBoston Financial Page
- Green Belts are the employees who take up Six Sigma implementation along with their other job responsibilities, operating under the guidance of Black Belts. Some organizations use additional belt colours, such as Yellow Belts, for employees that have basic training in Six Sigma tools. © 2003 FleetBoston Financial Page
- © 2003 FleetBoston Financial Page