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Six Sigma Awareness Training

Nov 14, 2014

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Six Sigma Awareness Training

Course ObjectivesThe objectives of this workshop are: To explain the purpose of Six Sigma and the Six Sigma approach. To discuss Six Sigma implementation. To discuss the process for setting up projects and deploying project teams.

Course Contents Six Sigma Overviews The DMAIC Process Steps and Tools Six Sigma Implementation Collective Decision Making Define: Set Up Projects and Deploy Teams

Section 1Six Sigma Overview

Six Sigma: What & WhyEffective Approach + Proper Deployment

RESULTS

Six Sigma Approach Key ComponentsProblem Solving ProcessDefineMeasureAnalyzeImproveControl

Improvement ToolsComprehensive and Integrated Set of Effective Improvement Tools

Quality PrinciplesA Set of Sound Underlying Concepts

Results-ExamplesAllied Signal Turn around from weak financial position in late 80s. US$3.2B cost savings during 1996 and 1997.

General Electric Achieve 40% increase in operating margin. Develop a better leadership for todays more competitive world.

Fort Wayne City Saved or avoided the need to spend nearly $3 million. Has made numerous changes that have meant better service for city residents.

Evolution of Quality PracticesDFSS, Lean Six Sigma Six Sigma Lean Manufacturing Business Process Reengineering ISO9000 Total Quality Management Just In Time (JIT) 2000s

1980s 1960s

1930s

TQC (Total Quality Control) SQC (Statistical Quality Control) Testing and Inspection

The Origin of Six Sigma1979 The Real Problem At Motorola Is That Our Quality Stinks ! Art Sundry(Formerly Motorolas Senior Executive)

1981

Tenfold Improvement Over A Five Year Period Robert Galvin (Formerly Motorolas President)

1980s Bill Smith discovered the correlation between market failures rate and manufacturing defects rate. At Government Electronics Group, under the leadership of Mikel Harry, experiments with problem solving through statistical analysis showed dramatic results. Mikel Harry began to formulate a methodology for applying statistical tools for problem solving. His work culminated in a paper titled The Strategic Vision for Accelerating Six Sigma Within Motorola.

1990 Robert Galvin asked Mikel Harry to start up and lead Motorolas Six Sigma Research Institute. The mission was to develop Six Sigma implementation strategies, deployment guidelines, and advanced statistical tools that would work in a variety of companies and industries.

Adoption of Six Sigma- Seagate - Caterpillar - 3M - Dupont - Citibank - Bank One - Fort Wayne City - Sony - Toshiba - Shimano - Matsushita 2000

General Electric AlliedSignal Motorola1987 1992 1995

Adaptation of Six Sigma: Purpose and Approach 1987 1992 1995 Motorola AlliedSignal General Electric Sony- Defect reduction - Manufacturing processes - Operational excellence - Include non-manufacturing processes - Financial results - Design for Six Sigma (DFSS) - Leadership development - Management Quality

2000

Six Sigma As Improvement Management SystemMindset Business Goals Performance Measures Dashboard Process Improvement (projects) Bottom Line Improvement Skill Set

Define

Champions

Data Measure + Analysis M-A-I-C Tools

Black Belts & Green Belts

Financial Benefit

Motorola Sigma Capability / Defect Per Million Opportunities (DPMO) AlliedSignal Laminate System Capacity Utilization Cost of Poor Quality (COPQ) Reduction Process Yield

Performance Measure Examples

General Electric Aircraft Engine Services Project Financial Benefits Order To Remittance Inventory Turns Span / On Time Delivery

Drill Down Process To Identify ProjectsBusiness Objective Deployment Approach: Business Goal CTQ 1 Sub CTQ 1 Sub CTQ 2 Sub CTQ 3 Sub CTQ 4 Project 1 Project 2 Project 3 Project 4 Objective A Objective CTQ 2

B Role & Responsibility: Executive Team

Champion Black Belts Green Belts

Example : CTQ TreeIncrease Sales

Sales Orders Production Output

Sales Lead Time On Time Delivery Order Fulfillment Customer Complaints Process Yield Down Time

New Products

Process Efficiency Time to Market Market Success Rate Design Changes Material Price Material Usage Rate

Profitability

Manage Cost

Material Cost Failure Cost Utility Cost Account Receivable Inventory

Improve Working Capital

Lot Reject Rate WIP Rejects Material Rejects Electricity Water Gas

TeamworkComing Together Is A Beginning Keeping Together Is Progress Working Together Is SuccessHenry Ford

Six Sigma BenefitsGE Capitals railcar-leasing business achieved 62% reduction in turnaround time at its repair shops. Customer who once found themselves able to talk with a GE Capital Mortgage associate only 76% of the time now have a 99% chance of success on the first try. GE Plastics added 300 million pounds of new capacity through rigorous Six Sigma process work. Citibanks Regional Cash Product Management Unit in Asia Pacific improved the defect rate of its fund transfer process to 4.95 sigma level.

Six Sigma As Problem Solving ProcessPhases Key Tasks Identify Performance Measures Create Projects Establish Data Collection Plan Understand Current Performance Brainstorm Possible Causes Verify Root Causes Identify Improvement Solutions Validate Effectiveness Establish Control System Share Lessons Learned

Responsibility

DEFINE MEASURE ANALYZE IMPROVE CONTROL

Champion

Green Belt

Black Belt

The DMAIC ToolkitDefine Process Map Brainstorming Dashboard CTQ Drill Down Cause & Effect analysis Pareto diagram Selection Matrix Project Charter

Measure Analyze ImproveData Collection plan Histogram Distribution Measurement System Analysis Descriptive Statistics Run charts Control Charts Process Capability Pareto diagram Brainstorming Nominal group technique Scatter plot Box plot Stratification FMEA Process C&E matrix Interval Estimate Hypothesis Test Process mapping and analysis Creativity Techniques Selection matrix Design Of Experiments Force field analysis Potential risks assessments Stakeholder analysis Process Capability

ControlControl plan Documentation system Control charts On the job training Story board

A] Soft Tools (Team Problem Solving) Brainstorming Affinity Diagram Nominal Group Technique Decision Matrix Effectiveness / Practicality Matrix Quality Function Deployment Failure Mode and Effect Analysis Force Field Analysis

B] Hard Tools (Quantitative Data Analysis) Graphical Tools Process Capability Study Measurement System Analysis Hypothesis Testing Design Of Experiments Control Charts

C] Work Process Redesign Process Mapping Non-value Add Analysis 7 Principles of Process Redesign Technology Enabler Process Streamlining Should Be Process MapInput Process Output

D] LEAN Value Stream Mapping Seven Major Wastes Flow-based Processing Kan ban System Set-up Reduction Mistake Proofing Visual Management Take Time Total Productive Maintenance

Six Sigma Key Features Top down approach Goals Alignment Logical and systematic process Consistency Rigorous problem solving method Effective Data driven and fact based decision Scientific Question conventions Breakthrough Results Financial benefits oriented Bottom Line Focus

What is Sigma? Sigma (Greek letter ) is a symbol for statistical unit of measurementcalled standard deviation that measure the variability of data from the mean. In Six Sigma program, Sigma is an index for measuring the capability of process to produce defect free products or services. A defect is any mistake that results in customer dissatisfaction.

The higher the sigma level, the less likely a process will producedefects. As sigma increases, costs go down, cycle time goes down, and customer satisfaction goes up.

Process VariationInput Process Output

All businesses are a system of interconnected processes. Variations exist in all processes. Variations in processes result in process outputs variability. Understanding and reducing process variability is the key to improving the capability of a process to produce defect free products or services.

Process Output VariabilityCycle time for taking X-ray at a hospital

0

10

20

30

40

50

60 (minutes)

Process Variability &Process CapabilityProcess Output Variability Customer Requirements Customer Requirements

Defects Less variability means less defects will be produced. Less defects means better capability in meeting customer requirements.

Process Capability:SigmaProcess Sigma Defect Per Million Percent Good Competitiveness

2 3 4 5 6

308,538 66,807 6,210 233 3.4

69.2% 93.3% 99.4% 99.98% 99.9997%

Noncompetitive Companies Average Companies

World Class Companies

Is Three Sigma Performance Acceptable?Example: GE Plastics before Six Sigma implementation 95% compounded product first pass yield=>3 million pounds of rework week. 90% on-time delivery =>1 missed shipment every 30 minutes. 98% billing accuracy. => 1 billing error every 3 hours. 98% capacity utilization => 20 million pounds of lost opportunity. 95% meetings star on time(5%with a 10-minute delay) => 1,000 work-hours lost each day.

Variability and Cost of Poor Quality (COPQ)The Costs of Not Doing Things Right the First Time

Activity 1

Activity 2

Activity 3

Re-doRe-check

Re-doRe-check

Re-doRe-checkLost Customer Goodwill

Re-Scheduling Service Recovery Corrective Actions Additional Handling Ad-hoc Meetings

C