Six Sigma Overview
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Six Sigma Overview
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Globalizing The Six Sigma WayThe challenge that every business executive from SMEs to MNCs isnow facing is how to improve on the small things' in his
organization's process that will cut costs, reduce waste andultimately generated greater profits for the organization. As a result,many companies, including world-class ones, are looking toimplement Six Sigma.
The Six Sigma of today speaks the language of management in adisciplined, fact-based way. It is a complete business leadership,quality and customer service approach that companies worldwidehave used to streamline and literally revolutionize the way they
expand their customer base worldwide.
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What are the common business processrelated problems?
Low productivity
Late delivery
Poor service
High cost of labour
High production costHigh rejects
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End result ?
Unsatisfied customer Uncompetitive todo business
Uncompetitiveproducts
………many more…
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What is Six Sigma ?The term sigma is a Greek alphabet letter used to describedvariability.
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What is Six Sigma ?Six Sigma is an information-driven methodology for reducingwaste, increasing customer satisfaction and improving
processes with a focus on financial measurable results, to createa culture that demands near perfection on target, every time !
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What is Six Sigma ?The objective of Six Sigma Quality is to reduce process outputvariation so that on a long term basis, which is the customer's
aggregate experience with our process over time, this will resultin no more than 3.4 defect Parts Per Million (PPM) opportunities(or 3.4 Defects Per Million Opportunities – DPMO).
Design tolerance
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What is Six Sigma ?Efficiency/Yields (%) DPMO Sigma Cpk
30.85 691,500 1
69.15 308,500 2
93.32 66,800 3 0.5
99.38 6,200 499.87 1,300 4.5 1
99.977 230 5 1.16
99.997 30 5.5 1.33
99.99966 3.4 6 1.5
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Why Six Sigma ?Six sigma will help to overcome the business process related
problems by
• Implementing a well structured and systematic approach toidentify areas to be improved.
• Applying statistical methods to quantify, reduce, eliminateand control the amount of variation in the process.
• Ensuring that decisions made are based on facts and data
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Why Six Sigma ?As the process sigma value increases from zero to six, thevariation of the process around the mean value decreases. With
a high enough value of process sigma, the process approacheszero variation and is known as 'zero defects.'
The end result is greater customer satisfaction and lower costs
Six Sigma statistically quantify the impact of causal factorsleading to variation, focus on the key factors, improve them andsustain the improvement for long term gains.
Business
and/or Customer
Requirement
12
34
56
Defects Good
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The history of Six SigmaIn the 1980s, Motorola CEO Bob Galvin was struggling tocompete with foreign manufacturers.
When Senior Sales Vice President Art Sundry admitted that "ourquality stinks," Bob and Art set a goal of tenfold improvement infive years.
Their plan focused on global competitiveness, participative
management, quality improvement, and training.Quality Engineer Bill Smith coined the improvementmeasurements as "Six Sigma." Training was deployed for allemployees, and Six Sigma became the standard for all business
processes.
In 1986, Motorola invented the Six Sigma.
In 1987, they set the goal of reaching the level of Six Sigma, or
no more than 3.4 defects per million opportunity.
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Six Sigma is not just about manufacturingInitially designed for improvements in manufacturingenvironments, Six Sigma now reaches well into every industry,from Financial Services to Health Care to Hospitality.
Initially on the assembly line, Six Sigma is now implemented atevery level, from VPs to quality managers to software engineers,and in every process, from Customer Service to HumanResources to Accounting.
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Applications & SuccessSix Sigma is a registered service mark and trademark ofMotorola, Inc. Motorola has reported over US$17 billion insavings from Six Sigma to date.
AlliedSignal and General Electric became early adopters of SixSigma, with GE reporting benefits of more than US $300 million
during its first year of application. Their CEOs, Larry Bossidy and Jack Welch played a vital role in popularizing Six Sigma.
Starting with manufacturing, today Six Sigma is being usedacross a wide range of industries like banking,telecommunications, insurance, marketing, construction,healthcare, and software.
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Applications & SuccessHealthcare
North Carolina Baptist Hospital says, "The Six Sigma process
improvement deployment at North Carolina Baptist Hospital isstarting to show the kind of results that convert skeptics tobelievers." and "A Six Sigma process improvement team chargedwith getting heart attack patients from the EmergencyDepartment into the cardiac catheterization lab for treatmentfaster slashed 41 minutes off the hospital's mean time"
Banking
Bank of America has used Six Sigma for credit risk assessmentreduction, fraud prevention, and customer satisfactionimprovement, etc. Bank of America's Six Sigma initiativeresulted in benefits of more than US$2 billion; and increased
customer satisfaction by 25%.
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Applications & SuccessInsurance
Insurance companies have used Six Sigma for critical tasks like
premium outstanding reduction and various cycle timereductions. For example, CIGNA Dental reports pending claimvolume reduction by over 50% .
Construction
In engineering and construction of the Channel Tunnel Rail Linkproject in the UK, the Bechtel’s project team uncovered a way tosave hundreds of job hours on one of the tunneling jobs.
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Six Sigma
Process ManagementControl and manage cross-function
processes to meet business goals
Improve EXISTINGprocesses so that
their outputs meet
customer
requirements
DesignNEW products
and processes
that meet
customer needs
Six Sigma Methodologies
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DMAIC problem solving approach
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DMAIC roadmap
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Tools use in Six Sigma Methodologieso Project Charter - this document is intended to clearly describe
problems, defect definitions, team information and deliverables for a
proposed project and to obtain agreement from key stakeholders.o Trend Chart - to see (visually) the trend of defect occurrence over a
period of time.
o Pareto Chart - to see (visually) how critical each input is in
contributing negatively or positively to total output or defects.
o Process Flow Chart - to understand how the current process
functions and the flow of steps in current process.
o Fishbone Diagram – to demonstrate the relationships betweeninputs and outputs
o Process Mapping - to understand the current processes and enable
the team to define the hidden causes of waste.
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Tools use in Six Sigma Methodologieso Cause & Effect Matrix - to quantify how significant each input is for
causing variation of outputs.
o Failure Mode & Effect Analysis (FMEA) - using this in the Measurephase helps to identify and implement obvious fixes in order to
reduce defects and save costs as soon as possible.
o Gauge Repeatability & Reproducibility (GR&R) - used to analyze
the variation of components of measurement systems so minimizeany unreliability in the measurement systems.
o Five Why’s - use this tool to understand the root causes of defects
in a process or product, and to penetrate through incorrect
assumptions about causes.
o Tests for normality (Descriptive Statistics, Histograms) – this is used
to determine if the collected data is normal or abnormal so as to be
properly analyzed by other tools.
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Tools use in Six Sigma Methodologieso Correlation/Regression Analysis - to identify the relationship
between process inputs and outputs or the correlation between two
different sets of variables.
o Analysis of Variances (ANOVA) - this is an inferential statistical
technique designed to test for significance of the differences among
two or more sample means.
o FMEA (Failure Mode and Effect Analysis) - applying this tool oncurrent processes enables identification of sufficient improvement
actions to prevent defects from occurring.
o Hypothesis testing methods - these are series of tests in order to
identify sources of variability using historical or current data and toprovide objective solutions to questions which are traditionally
answered subjectively.
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Tools use in Six Sigma Methodologieso Process Mapping - this tool helps to represent the new process
subsequent to the improvements.
o Process Capability Analysis (CPK) - in order to test the capability ofprocess after improvement actions have been implemented to ensure
we have obtained a real improvement in preventing defects.
o DOE (Design of Experiment) - This is a planned set of tests to
define the optimum settings to obtain the desired output and validateimprovements.
o Control Plans - this is a single document or set of documents that
documents the actions, including schedules and responsibilities, that
are needed to control the key process inputs variables at the optimalsettings.
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Tools use in Six Sigma Methodologieso Operating Flow Chart(s) with Control Points - this is a single chart
or series of charts that visually display the new operating processes.
o Statistical Process Control (SPC) charts - these are charts that helpto track processes by plotting data over time between lower and
upper specification limits with a center line.
o Check Sheets - this tool enables systematic recording and
compilation of data from historical sources, or observations as theyhappen, so that patterns and trends can be clearly detected and
shown.
The Powerful DMAIC Road Map
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Analyze
DefineMeasure
Improve Control
The Powerful DMAIC Road Map
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Define
Define
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Project Charter
Problem Statement:
Goal:
Business Case:
Scope:
Cost Benefit Projection:
Milestones:
VOC Key Issue CTQDelighters
More Is Better
Must Be
Voice of the Customer Business Case
Initial Process Mapping
OutputsProcessInputs
Yield: 60%
Yield: 90%
Yield: 45%
Yield: 98%
C U S T OM
E R S
S UP P L I E R S
Define
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Measure
Measure
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Col # 1 2 3 4 5 6
Inspector A B
Sample # 1st Trial 2nd Trial Diff 1st Trial 2nd Trial Diff
1 2.0 1.0 1.0 1.5 1.5 0.0
2 2.0 3.0 1.0 2.5 2.5 0.0
3 1.5 1.0 0.5 2.0 1.5 0.5
4 3.0 3.0 0.0 2.0 2.5 0.5
5 2.0 1.5 0.5 1.5 0.5 1.0
Totals 10.5 9.5 3.0 9.5 8.5 2.0
Averages 2.1 1.9 0.6 1.9 1.7 0.4
Sum 4.0 Sum 3.6
X A 2.0 XB 1.8R A
RB
Validate Measurement
Systems
Display Data
0
1000
-1000
10 20 30
UCL
X
LCL
D B F A C E Other
Identify the Metrics
Data Collection Plan
Operational Definitio n and Procedures
Data Collection PlanWhat questions do you want to answer?
Data
What Measure type/Data type
Howmeasured
Relatedconditions
Samplingnotes
How/where
How will you ensureconsistency and stability?
What is your plan forstarting data collection?
How will the data be displayed?
Prioritize the Metrics
I1I2
I3
I4
O1 O2 O3 O4
FMEA
Identify Process CapabilityLSL USL
Cp = 0.4s = 2.7
Measure
the
process
I P O
InputMeasures
ProcessMeasures
OutputMeasures
Measure
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Analyze
Analyze
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.
VA NVAProcess Door
Regression AnalysisChi-Square
c²
Regression
t-test ANOVA
X 1
Y
Hypothesis-Testing Design of Experiments
.
Cause & Effect
Data Door 22
21
20
19
18
17
16
15
14
13
12
1 2 3 4 5 6 7 8 9 10
X
O
n
X
O
n
X
O
n
X
O
n
X
O
n
X
O
n
X
O
n
X
O
n
O
n
X
O
n
.
y
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Improve
Improve
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Perform
Cost-Benefit
Analysis
Generate Solutions
A
B
C
D
4
1
32
Assess Risks
Run PilotTest
Full scale
Original
2 4 86 10
G
1 3 5 7 9
A
B
C
D
FE
JIH
G
PlanImplementation
Select the Solution
FMEA
p
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Control
Control
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Evaluate ProjectResults
.
UCL
LCL
Ownership &
Monitoring
Before After
Step 4 changesimplemented
} Improvement
Target
} Remaining Gap
Good
} Improvement
Before After
A1 A2 A3 A4 A2 A1 A3 A4
Process ChangeManagement
Learnings
Recommendations
Results
•••
next
Key Learnings
QC Process Chart
WorkInstructions
Control/Check Points Response to Abnormality
NotesCode # Charac-teristics
ControlLimitsMeth odWho
ImmediateFix
PermanentFix Who
Flowchart
2
12
Product NameProcess NameProcess Code #
Date of Issue: Issued by: Approved by:
Revision Date Reason Signature
1
Document &Standardize
TrainingCurriculum
TrainingManual
Fill to here
.
Closure
LSL USLs = 3.7Cp = 1.4
s = 2.7
Cp = 0.4
Process
Owner