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Six Sigma Overview
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Overview for Six Sigma

Apr 13, 2018

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Hoo Chee Wai
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Page 1: Overview for Six Sigma

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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

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 

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Thank you !