Aaron Khieu Who is Using Six Sigma in the Twin Cities Seagate, Medtronic, Donalson, Honeywell, American Express, Ceridian, 3M.

Aaron Khieu

Who is Using Six Sigma in the Twin CitiesWho is Using Six Sigma in the Twin Cities Seagate, Medtronic, Donalson, Honeywell, American Express,

Ceridian, 3M

Aaron Khieu

What is Six Sigma?What is Six Sigma?

Six Sigma - The Initiative

ProcessSystematic approach to reducing defects which affect what

is important to the customer

ToolsQualitative, statistical and instructional Devices for

“observing” process variables and their relationships as well as “managing” their character

Aaron Khieu

Sigma is a statistical unit of measure that reflects process capability. The sigma scale of measure is perfectly correlated to such characteristics as defects-per-unit, parts-per-million defective, and the probability of a failure/error.

2 308,5373 66,8074 6,2105 2336 3.4

PPMPPM

ProcessCapability

ProcessCapability

Defects per Million Opp.

Six Sigma - Aggressive GoalSix Sigma - Aggressive Goal

Aaron Khieu

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 MeaningSix Sigma -- Practical Meaning

Aaron Khieu

How Does Six Sigma Make the Difference?How Does Six Sigma Make the Difference?

Vision Philosophy

Aggressive goal Breakthrough improvement

Focus Customer focus Problem focus Process focus

Metric (standard of measurement) Method

Aaron Khieu

The Goals of Six SigmaThe Goals of Six Sigma

Defect Reduction

Yield Improvement

Improved Customer Satisfaction

Higher Net Income

Aaron Khieu

What’s the StrategyWhat’s the Strategy

Know what’s important to the Customer

Reduce defects

Center around target

Reduce Variation

Aaron Khieu

Six Sigma VisionSix Sigma Vision

The Vision of Six SigmaThe Vision of Six Sigma is to delight customers by delivering world-class quality products through the achievement of Six Sigma levels of performance in everything we do.

Aaron Khieu

Six Sigma PhilosophySix Sigma Philosophy

The Philosophy of Six SigmaThe Philosophy of Six Sigma is to apply a structured, systematic approach to achieve breakthrough improvement across all areas of our business.

Aaron Khieu

Where Does Industry Stand?Where Does Industry Stand?

7

Sigma Scale of Measure

1,000,000

100,000

10,000

1,000

100

10

1

PPM

••

Restaurant Bills

Doctor Prescription Writing

Payroll Processing

Order Write-up

Journal Vouchers

Wire Transfers

Airline Baggage Handling

Purchased Material

Lot Reject Rate

Domestic Airline Flight

Fatality Rate (0.43 PPM)

Best-in-Class

Average

Company

3 4 5 621

IRS - Tax Advice

(phone-in)

(140,000 PPM)

Aaron Khieu

3 Sigma

6 Sigma

5 Sigma

4 Sigma

93.32 %

99.379 %

99.9767 %

99.99966 %

Historical

Current

Intermediate

Long-Run

Sigma Long-Term Yield Standard

Six Sigma - Performance TargetSix Sigma - Performance Target

Aaron Khieu

To deal with a world of declining product prices

To compete successfully with the best companies in the world To establish standard language and approaches across functions and across businesses To develop our next generation of leaders

To accelerate our rate of quality and productivity improvement faster than our competitors

Six Sigma - Why?Six Sigma - Why?

Aaron Khieu

You Could Select One of Your Most Highly Leveraged Problems . . . ?

Identify One of Your Best People to Work on It . . . ?

Provide That Person With All of the Training, Tools, and Resources They Need to Fix It . . . ?

Guarantee Them Uninterrupted Time and Focus to Work on It . . . ?

And Get a Well Thought Out, Data Driven Solution . . . ?

Six Sigma Basics ...What If...?Six Sigma Basics ...What If...?

That Is

Six Sigma !That Is

Six Sigma !

The People Who Make it HappenThe People Who Make it Happen

BusinessBusinessChampionsChampions

Hands onHands onChampionsChampions

MasterMasterBlack BeltsBlack Belts Black BeltsBlack Belts

Finance RepsFinance RepsSix Sigma Directors &Six Sigma Directors &Six Sigma ExecutiveSix Sigma Executive

DFSSDFSSEmployeesEmployees

Green Belts &Green Belts &All EmployeesAll Employees

Aaron Khieu

Six Sigma - Approaches to ImprovementSix Sigma - Approaches to Improvement

1 2 3 4 5

The problem with continuous improvement as the only goal….

Organization sees improvement BUT loses the game.Six Sigma Enables Breakthrough Level Improvement!

Six Sigma

Continuous Improvement

Time in Years

-Current Tools-Kaizen-Lean Manufacturing-Reengineering-Typical TQM

Breakthrough Strategy

-Trained & Dedicated Individuals-Analytical Expertise->70% Improvement per Project

Aaron Khieu

f (X)f (X)Y=Y=

Focus on X rather than Y, as done historicallyFocus on X rather than Y, as done historically

The Focus of Six SigmaThe Focus of Six SigmaKPIV(s)

KPOV(s)

*

Defect

(Gap)

Critical To The Customer

Metrics

KPOV = Key Process Output Variable

KPIV = Key Process Input Variable

Aaron Khieu

Six Sigma as a Problem Solving SystemSix Sigma as a Problem Solving SystemSix Sigma employs the Breakthrough Strategy, which is a multi-step

problem solving and process improvement methodology.

1. Measure1. Measure

2. Analyze2. Analyze

3. Improve3. Improve

4. Control4. Control

0. Define0. Define

5. Realize5. Realize

Aaron Khieu

Six Sigma Road Map - Define & Measure Six Sigma Road Map - Define & Measure

Problem Statement

Cause and EffectFMEA Fishbone; other methods

MSA

Process Map

• CTQs• COPQ est.

Identify:• process inputs• process outputs

Link KPIV & KPOV• prioritize inputs to attack

Is Measurement good enough to detect process variation?(see improvement!)

Define theSituation

Generates/Determines

Create withTeam

with team . . .Root CausesStrong Links

Check Gauges &Data CollectionDevices & Procedures

De

fin

e/M

ea

su

re

Rolled Throughput YieldDetermine:opportunities forimprovement

Defect Rateper Step

Aaron Khieu

Process CapabilityStudy

Confidence Intervals

Indicators:Performance & EntitlementDPMO; Sigma ScoreCp Pp Cpk Ppk

Generates/Determines

Gather HistoricalData or Sample(Size & Subgroup)

DetermineCost of Quality

Review Internal &External Costs

Potential Benefits

Analytical ToolsMinitab Trends & Behaviors in KPIV/KPOV relationships

Mea

sure

An

alyz

e

Applies throughout

Six Sigma Road Map - Measure & Analyze Six Sigma Road Map - Measure & Analyze

Aaron Khieu

Hypothesis for Variables - Means

(t-tests)

Generates/Determines

Variables Data

Hypotheses forAttributes

(Contingency Tables, Non-parametric study)

Proportion DefectsProportion Defectives

Answers:Differences in % Def.Between pop.;Diff. in % Def. fromoverall mean

Variables Data

Answers:Difference in Means?One Pop. to Another;Before/After; to Spec

Answers:Difference in Spread?One Pop. to another;to baseline; multiplePops.

Collecting data on several variables at the same time

Hypotheses forVariables - Std. Dev.

(Chi Sq., F-Test, Homogeneity of Variance)

Multi-Vari StudiesPoints to variableswarranting furtheranalyses

An

alyz

e

Six Sigma Road Map - Analyze Six Sigma Road Map - Analyze

Aaron Khieu

ANOVA

Generates/Determines

Answers:Difference in Means?One Variable (Factor)Multiple Types

Variables Data

Correlation & Regression

This completes the Characterize phaseconfirming which Input Variables most directly affect

the Output Variables:Move on to Optimize - Settings or Procedures

For pairs ofcontinuousData Variables

Answers:If know X; Predict YStrength & Direction

An

alyz

e

Six Sigma Road Map - Analyze Six Sigma Road Map - Analyze

Aaron Khieu

Design ofExperiment

Fractional Factorial

Answers:How to Set “X” to getBest “Y”

Generates/DeterminesKnown Relationshipsbetween KPIVs & KPOVs

Full FactorialSimple 2K

Testing Variablesat 2 Levels(High/Low)

Answers:What’s the BestCombination of the “Xs’for producing the Best “Y”

Tests Multiple Variables, at Various Levels (High/Low)

Answers:What’s the Best Combination of ALL Variables (X) to give the Best Output (Y)

Full FactorialMultiple Variables

Answers:Same as Above - But . ..Less Information; More Risk - but, requires less experimentation

Tests Multiple Variables But Not All; Not All LevelsConserves Resources

Imp

rove

Six Sigma Road Map - Improve Six Sigma Road Map - Improve

Aaron Khieu

DOE- BlockingClarifies Results whenInteracting Variables“Confound” the Results

Generates/Determines

Isolates Parts of Data from other Parts

Imp

rove

Now . . . We have established the parameters and procedures for

operating the improved process . . . Keep it in Control !

EHS ReviewReviews Affects onthe Environment,Health & Safety

Improves Current EHSSituation and/or IdentifiesIssues to be Managed Up-Front

Six Sigma Road Map - Improve Six Sigma Road Map - Improve

Aaron Khieu

“Process” Control Plans

Instructions & Training

Indicates if Process is Operating as Expected (In-Control); If Not, What Corrections to Make

Generates/Determines

CTQs, Specs, Measurements,Actions

SPC

Outlines: Parameters of Operations, Responsibilities, Actions, Measurements, etc.

Gauges, Forms &Data CollectionMethods

Outlines:Checking, Maintenance,Care & Periodic Review of Data Collection Devices & Methods

Gauge/MeasurementStability & Control

Outlines:How Employees “Do” Procedures - Standard & Consistent, Opportunity for Understanding & Verification of Understanding

Real-time ProcessResults; Trends;Control Limits

Employees,Documented Proc. Learning Events

Co

ntr

ol

Six Sigma Road Map - Control Six Sigma Road Map - Control

Outlines:Indicators to Monitor; Actions toPrevent Failures, ResourcesNeeded On-Hand

PreventiveMaintenance

Plan

Spare Parts; SystemBack-Ups; ScheduledDowntime, etc.

Aaron Khieu

Change Control

Generates/DeterminesInputs AffectingProject; OthersAffected by Project

Outlines:Procedures for Making Changes; Predictions of Change Affects

Cost to Controlvs CTQ Attainment& Benefits Achieved

Checks:Project Controls Appropriate for Achieving CTQs and Benefits

Cost Review

Sustained Process Will Meet Customers

Expectations

All Agree and Commit to theControl Strategy as the Meansof sustaining the Defect Reductions

Co

ntr

ol

Re-Design

Functional Team Sign-Off&

Celebrate!

Yes

No

DF

SS

Six Sigma Road Map - Control & DFSS Six Sigma Road Map - Control & DFSS

DFSS = Design for Six Sigma

Aaron Khieu

Six Sigma - How Does It Work?Six Sigma - How Does It Work?

•Champions•Master BB’s•Black Belts•Brown Belts

•Strong Analytical Skills•Strong Problem Solving Skills•People & Leadership Skills

•Critical to Success•Chronic or Systemic•Fastest or Largest Return

•Lead Focused Effort•Apply Skills and Tools •Determine Causes and Solutions•Reduce Variability

Select the Right People

Provide Intense Training

Select KeyProblem Areas

Assign Projects toBlack Belts

ObtainResults

•Preventative & Proactive Vs Appraisal & Reaction•Fewer Trials•Faster•Accurate Solutions

Aaron Khieu

Six Sigma BasicsSix Sigma Basics Six Sigma Provides a Disciplined Method for Reducing Defects. Customers Define Their Critical to Satisfaction Measures (CTS’s). Champions Define Key Outputs of a Process Whose Defects Most

Significantly Impact the CTS’s & Assign Projects to Black/Green Belts. Black/Green Belts Identify the Process Inputs That Most Significantly

Influence the Outputs. They Then Eliminate the Root Causes of Variation in the Inputs and

Put in Controls to Prevent Reoccurrence of the Problem. Design For Six Sigma Engineers Identify and Exploit Areas of

Decreased Sensitivity to the Input Variables in Order to “Design In”

Quality.

Aaron Khieu

Six Sigma ReferenceSix Sigma Reference www.isixsigma.com The Six Sigma Way: How GE, Motorola, and Other Top

Companies are Honing Their Performance by Peter S. Pande et al, Robert P. Neuman, Roland R. Cavanagh.

The Six Sigma Handbook: A Complete Guide for Greenbelts, Blackbelts, & Managers at All Levels by Thomas Pyzdek