AN INTRO TO 6 SIGMA-1.pdf

7/27/2019 AN INTRO TO 6 SIGMA-1.pdf

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An IntroductionAn Introduction

LSSULSSU -- IABIAB

30 January 200230 January 2002


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What is it?What is it?


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Six SigmaSix Sigma: What is it?: What is it?

A comprehensive and flexible system forA comprehensive and flexible system for

achieving, sustaining and maximizing businessachieving, sustaining and maximizing businesssuccess. Six Sigma is uniquely driven by closesuccess. Six Sigma is uniquely driven by close

understanding of customer needs, disciplined useunderstanding of customer needs, disciplined use

of facts, data and statistical analysis, and diligentof facts, data and statistical analysis, and diligentattention to managing, improving and reinventingattention to managing, improving and reinventing

business processes.business processes.

-- The Six Sigma Way, by Pande, Newman and Cavanaugh


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Specifically

Customer-focused, fact and data-based

decision making driving out waste and

defects which creates value for our

customers.

It is just NOT Supply Chain or Manufacturing


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AA cultureculture that rapidly drives our key activities* tothat rapidly drives our key activities* to

be defect free 999,997 times out of 1,000,000.be defect free 999,997 times out of 1,000,000.

< 3.4 defects per million opportunities.< 3.4 defects per million opportunities.

* Valued by or critical to our customer.



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Sigma - the lower case Greek letter thatdenotes a statistical unit of measurement

used to define the standard deviation of a

population. It measures the variability or

spread of the data.

What is Sigma?What is Sigma?


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Cure Time of Silicone Sealant

N

umberofSa

mples

Lower Specification Limit

(LSL)Upper Specification Limit

(USL)


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Upper Specification Limit

(USL)


(LSL)

x

x


(LSL)


(USL)


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(USL)


(LSL)

x


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Putting Six Sigma in Perspective!Putting Six Sigma in Perspective!

If you played 100 rounds of golf per year, and

played at:

2 sigma - you'd miss 6 putts per round

3 sigma - you'd miss 1 putt per round

4 sigma - you'd miss 1 putt every 9 rounds

5 sigma - you'd miss 1 putt every 2.33 years

6 sigma - you'd miss 1 putt every 163 years!


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20,000 lost articles of mail20,000 lost articles of mail every hour.every hour.

Power outages seven hoursPower outages seven hours each month.each month. ..

5,000 incorrect surgical procedures5,000 incorrect surgical procedures each weekeach weekfor a major healthcare provider.for a major healthcare provider.

Unsafe drinking water nine minutesUnsafe drinking water nine minutes every day.every day.

Two long / short airport landingsTwo long / short airport landings every dayevery day..

FourFourSigmaSigma quality (quality (6210 DPMO)6210 DPMO) meansmeans

99.370% rightbut..99.370% rightbut..


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Airline passenger safety ~ 8.2Airline passenger safety ~ 8.2

Currently at 2.6 DPMO (incidents per millionCurrently at 2.6 DPMO (incidents per million

takeoffs and landings).takeoffs and landings).

Airline baggage handling ~ 3Airline baggage handling ~ 3 ..

SixSix SigmaSigma quality (quality (< 3.4 DPMO).< 3.4 DPMO).


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Impact of Six SigmaImpact of Six Sigma

The Cost of Poor Quality

Sigma Level Defects per Million Opportunities Cost of Poor Quality2 398,537 (Noncompetitive Companies) Not applicable

3 66,807 25-40% of sales

4 6,210 (Industry Average) 15-25% of sales5 233 5-15% of sales

6 3.4 (World Class) < 1% of sales

Each sigma shift provides a net income improvement which equals 10% of sales.

Six Sigma, by Harry and Schroeder, p. 17


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1987 Motorola introduced Quality Program now known as1987 Motorola introduced Quality Program now known asSix SigmaSix Sigma..

Allied Signal picked it up.Allied Signal picked it up. G.E. Success.G.E. Success.

Capital ServicesCapital Services

Medical Systems (CAT Scan)Medical Systems (CAT Scan)

Dozens of others...Dozens of others... Learned the hLearned the highestighest qqualityuality pproducer is also theroducer is also the llowestowest ccostost

pproducer.roducer. Learned customer loyaltyLearned customer loyalty of a Six Sigma company isof a Six Sigma company is ~3X~3X thatthat

of theof the averageaverage companycompany..

It all began at..Motorolanot G.E.It all began at..Motorolanot G.E.


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Who else is doing Six Sigma?Who else is doing Six Sigma?

Avery DennisonAvery Dennison

DowDow

DuPontDuPont

FoxboroFoxboro

SonySony Deere & Co.Deere & Co.

(John Deere)(John Deere)

DelphiDelphi

Allied SignalAllied Signal FordFord

Johnson & JohnsonJohnson & Johnson CaterpillarCaterpillar Lockheed MartinLockheed Martin IBMIBM

CitiGroupCitiGroup(Visa/MasterCard)(Visa/MasterCard)

GG..EE..

J.P. MorganJ.P. Morgan ServiceMasterServiceMaster


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How does Six Sigma work?How does Six Sigma work?Why is it different?Why is it different?

Top down, executive led. Customer focused (VOC).

Project oriented

Led by Black Belts. 3-5 months long.

Ave. yearly impact $150-250K/project.

Consistent methodology.


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What is the Methodology?What is the Methodology?

DDefineefine

MMeasureeasure

AAnalyzenalyze

IImprovemprove

CControlontrol

D M A I C


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What are the The Tools?What are the The Tools?Six Sigma is aSix Sigma is adisciplinediscipline using these tools:using these tools:

7 Tools of Quality7 Tools of Quality Advanced analysis tools (Design of Experiment,Advanced analysis tools (Design of Experiment,

Linear Regression, etc.)Linear Regression, etc.)

ReRe

--engineeringengineering

Lean manufacturingLean manufacturing

Supply chain improvementsSupply chain improvements

Design for Six Sigma (DFSS)Design for Six Sigma (DFSS)

For development of new products, new services,For development of new products, new services,new processes, and new workflows.new processes, and new workflows.


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Who are the other Key Players?Who are the other Key Players? Senior ChampionSenior Champion Owns Six Sigma for the Business.Owns Six Sigma for the Business. ChampionChampion IdentifiesIdentifies and resourcesand resources projectprojects.s. MasterMaster BBlacklackBBeltelt Serves as coachServes as coach to the Black Beltto the Black Belt

and project team.and project team.

BlackBlackBBeltelt Leads the project team, full timeLeads the project team, full time..

GreenGreen BBeltselts Team members (partTeam members (part--time) from thetime) from theorganization sponsoring the projectorganization sponsoring the project

Project SponsorsProject Sponsors Team leaders.Team leaders.

Process OwnersProcess Owners Owns the process / workflow.Owns the process / workflow. Executive Six Sigma Steering CommitteeExecutive Six Sigma Steering Committee OverseesOversees

progress, resolves issues, ensures success enterpriseprogress, resolves issues, ensures success enterprise--wide.wide.


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Summary take awaysSummary take aways

Customer focused.Driven by the Voice of the Customer.Customer focused.Driven by the Voice of the Customer. Strong top management leadership, commitment, andStrong top management leadership, commitment, and

involvement. Very Key!involvement. Very Key!

Project orientation with measurable financial results.Project orientation with measurable financial results.

Consistent methodology for all work.Consistent methodology for all work. Time driven.Time driven.

Time driven.more accountable.Time driven.more accountable.

Six SigmaSix Sigma -- is ais adisciplinediscipline not an add on or program.not an add on or program.

-- NOTNOT a supply chain/manufacturing activity.a supply chain/manufacturing activity.-- No new toolsNo new tools.new ways to apply them!.new ways to apply them!

GoalsGoals

Value for the Customer (i.e. no defects or waste & low cost)Value for the Customer (i.e. no defects or waste & low cost) Improved productivity = profitability.Improved productivity = profitability.

Customer success and satisfaction + Profitability = GrowthCustomer success and satisfaction + Profitability = Growth


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References

The Six Sigma Way (ISBN 0-07-135806-4) by Pande,

Neuman, and Cavanaugh

The Power of Six Sigma (ISBN 0-7931-4434-5) by SubirChowdhury

Six Sigma (ISBN 0-385-49437-8) by Harry and Schroeder.

The Six Sigma Handbook (ISBN 0-07-137233-4) by Pyzdek ismore technical and becoming the 'handbook' for Black Belts.

You can get them through Amazon, http://www.amazon.com/in

a couple of days.


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References

Also...you might consider:

www.6-sigma.com

www.sixsigma.co.uk

www.sixsigmasystems.com

www.isixsigma.com

AN INTRO TO 6 SIGMA-1.pdf

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