Six Sigma Overview The Pennsylvania State University Frank L. Chelko October 9, 2006
Jan 21, 2015
Six SigmaOverview
The Pennsylvania State University
Frank L. Chelko
October 9, 2006
Six Sigma
A rigorous, focused and highly effective implementation of proven quality principles and techniques that aims for virtually error free business performance.
Further Defined?
• A statistical approach to problem solving• A management culture• A way of thinking• A set of new behaviors• Synonymous with:
– Improving quality– Reducing cost– Improving customer loyalty/customer
satisfaction– Achieving bottom-line results
Six Sigma’s Modern Evolution1980
– Established by Motorola in response to foreign competition and Baldridge Quality Award goal.
1990’s– Focus on process improvement using
statistical tools.2005
– “Lean Six Sigma” combines the structured management methodology and problem solving tools of Six Sigma with the business strategy, objectives and goals of “Lean Enterprise”.
The Business Experience
• Reduced cycle times, defects and costs• Reduction/elimination of waste• Improved productivity and efficiency • Measurable financial results • Increased product quality and reliability • Significant improvement in customer
satisfaction!• Directly supports World Class performance
goals.
$600$500$450$380$200
$2.5B
$1.2B
$700
$170
CostBenefit
1996
CostBenefit
1997
CostBenefit
1998
CostBenefit
1999
CostBenefit
2000
6 Sigma Cost6 Sigma ProductivityDelighting Customers
GE Results from 6 Sigma
$3.5B
$500$500
$3.0B$3.0B
$600
$2.5B$2.5B
$900$900
$3.4B
Cost Benefit
2001
$3.4 Billion in 2001 … Customers & Shareholders Love It!$ in Millions Unless Otherwise Stated
The Business Experience
*Six Sigma is currently active in over 80% of Fortune 500 companies.
* Masset, LLC Consulting
• Motorola• Johnson & Johnson• Honeywell• TRW• Merrill Lynch• Xerox• McKesson• Sony
Management andProject Support
Executives
Senior Deployment Champion
Deployment Champion
Project Champion
ProcessOwner
FinanceChampion
InformationTechnologyChampion Human
ResourcesChampion
Management and Project Support• Executives
– Create the Six Sigma vision and company environment.
– Define strategic and business goals.
• Senior Deployment Champions– Day-to-Day management of Six Sigma throughout the business.
– Reports to and updates the executives on the progress of deployment.
– Liaison between the executives and deployment champions.
• Deployment Champions or Sponsors– Responsible for the deployment of Six Sigma within the division or
business unit.
– Facilitates the identification and prioritization of projects assuring alignment with the business goals.
– Establishes and executes training plans.
– Selects the project champions.
– Removes barriers for the project team.
Management and Project Support• Project Champion
– Selects and mentors the Black Belts– Leads in project identification, prioritization, and defining the project scope.– Removes barriers for Black Belts and aligns resources.
• Process Owner– Is a team member– Takes ownership of a project when it is complete– Responsible for maintaining the project’s gain
• Finance Champion– Estimates and certifies project savings– Works with deployment champions to identify potential project opportunities.– Assigns a finance representative on to each project team.
• Information Technology Champion– Insures computer and software resourcing. – Works with project teams to access data from existing databases
• HR Champion– Works with Black Belts to develop a MBB, BB, and GB selection process.
Six SigmaRoles and Responsibilities
Yellow Belt
Green Belt
Black Belt
MBB
• Data Collection Experts• Assist in Measure & Control.
• Part-Time 6 Sigma Leaders• Run Mini 6 Sigma Projects
• Full or Part Time 6 Sigma Leaders• Manage 6 Sigma Projects• Instruct & Train GBs & YBs
• Full Time 6 Sigma Leaders• Manage BB Projects & Plant 6 Sigma• Run 6 Sigma Projects• Instruct & Train BB, GBs, & YBs
Six SigmaProjectTeams
define
Measure
Analyze Improve
Control
Belt Structure
Green Belts: Lead and execute process-level improvement projects.
Yellow Belts: Entry Level team member. Understands the fundamentals of Six Sigma. Data collection.
Belt Structure
Master Black Belts: Successfully completed 20 or more Six Sigma projects.
Black Belts: Implement the principles, practices, and techniques of Six Sigma for maximum cost reductions. (Lead the project teams)
The Methodologies
Six Sigma Methodologies
Define Measure Analyze Improve Control
DMAIC (dee-may-ic)Improvement Model:
Define Measure Analyze Design Verify
DMADV (dee-mad-v) (Re)Design Model:
Six Sigma Methodologies
Define Measure Analyze Improve Control
DMAIC (dee-may-ic)Improvement Model:
Define Measure Analyze Design Verify
DMADV (dee-mad-v) (Re)Design Model:
The DMAIC Model
At the heart of Six Sigma is a systematic method for analyzing and improving business processes called DMAIC. The model includes five elements:
Define opportunities Measure performance Analyze opportunity
Improve performance Control performance
Define
What is the business case for the project?
Identify the customer Current state map Future state map What is the scope of this project? Deliverables Due date
Measure
What are the key metrics for this business process?
Are metrics valid and reliable? Do we have adequate data on this
process? How will I measure progress? How will I measure project success?
Analyze
Current state analysis Is the current state as good as the
process can do? Who will help make the changes? Resource requirements What could cause this change effort to
fail? What major obstacles do I face in
completing this project?
Improve
What is the work breakdown structure?
What specific activities are necessary to meet the project's goals?
How will I re- integrate the various subprojects?
Control
During the project, how will I control risk, quality, cost, schedule, scope, and changes to the plan?
What types of progress reports should I create?
How will I assure that the business goals of the project were accomplished?
How will I keep the gains made?
Next Project
Next Project
Project Phase Candidate Six Sigma Tools
Define Project charter VOC tools (surveys, focus groups, letters, comment cards) Process map QFD, SIPOC (suppliers, inputs, process, outputs, customers) Benchmarking
Measure Measurement systems analysis Exploratory data analysis Descriptive statistics Data mining Run charts Pareto analysis
Analyze Cause-and-effect diagrams Tree diagrams Brainstorming Process behavior charts (SPC) Process Maps Design of Experiments Enumerative statistics (hypothesis tests) Inferential statistics (Xs and Ys) FMEA (failure mode effects analysis) Simulation
Improve Force field diagrams 7M tools Project planning and management tools Prototype and pilot studies
Control SPC FMEA ISO 900x Change budgets, bid models, cost estimating models Reporting system
Six Sigma Methodologies
Define Measure Analyze Improve Control
DMAIC (dee-may-ic)Improvement Model:
Define Measure Analyze Design Verify
DMADV (dee-mad-v)(Re)Design Model:
The DMADV ModelSystematic method for creating or reinventing business processes is DMADV. Typically use:
• New designs • Existing product or process was optimized however continues not to meet Six Sigma objectives.
The model also includes five elements: Define opportunities Measure performance Analyze opportunity
(Re) Design opportunity Verify performance
DMADV vs. DMAIC
Define
MeasureExisting Process
Verify
Design
Analyze
Develop Measurement
Criteria
RemoveSpecialCauses
Improve
Control
Capable?
InControl?
Does a process exist?
NO YES
Analyze
NO
DMADV DMAIC
Tollgate Reviews• Another component of DMADV and DMAIC that helps
to ensure that the requirements of all customers are met is the tollgate review.
• At the end of each phase of the DMADV or DMAIC process, all stakeholders meet to ensure that:
1) The requirements have not changed2) What is being designed still addresses the requirements. 3) The measurements really address the requirements.
The tollgate review is an excellent tool for keeping all customers on the same page, involved in the process and communicating requirements.
The Six Sigma Project
Typical “Project” Examples
Thermal insulator pad improvement $207,000
Laser test time cycle reduction $500,000
Reduce past due orders, delivery $1,040,000
Reduction of forge cracks $635,046
Reduction of job change down time $900,000
Reduce cycle time of paint batches $119,000
Wash water generation reduction $83,690
Reducing dppm of cell phone mfg. $408,000
Reduce brazing costs of tail cone assy. $194,000
Computer storage component test $1,100,000
Six Sigma Pitfalls1. Companies that adopt Six Sigma as there quality
improvement strategy believe that every problem should be resolved by a Six Sigma project team.
2. Insufficient cross-functional team representation.3. Inadequate participation by executive management.4. Initially a part-time BB requires significant start-up
time to achieve success and may conflict with other duties.
5. Unrealistic Goals. 3.4 parts per million on Every Process, Excessive Time and Cost to Gather Performance Data, etc.
Questions???
Six Sigma Process and the Statistical Tools
AnalyzeA
MeasureM
DefineD
ImproveI
ControlC
• Voice of the Customer (VOC) - QFD
• XY Matrix• Process Analysis and FMEA• Data Collection Methods• Data Integrity and Accuracy• Basic Statistics - Common Distributions - Central Limit Theorem - Sampling Distribution of Mean - Basic Probability Concepts• Decision-Making• Non-Normal Data Graphical• Short vs. Long Term Capability• Data Analysis (B7) - Cause and Effect Diagram - Check Sheets - Control Charts - Flowcharts - Histogram - Pareto Chart - Scatter Diagram• Measurement System (Gage) Analysis• Process Capability Assessment
• Graphic Data Analysis• Multi-Vari Analysis• Inferential Statistics - Confidence Intervals - Sample Size• Hypothesis Tests - Means, Variances and Proportions - ANOVA - T-Tests - Test for Equal Variance - Paired Comparison Tests - Chi-Square - Proportion - Contingency Tables - Point and Interval Estimation - Non-Parametric Tests• Simple Linear Correlation• Regression-Simple and Multiple - Measure and Model Relationships Between Variables - Binary Logistics • Process Modeling and Simulation
• Hypothesis Tests - ANOVA - Non-Parametric tests - Contingency Tables• Design of Experiments - Terminology - Plan and Organize Experiments - Design Principles - One Factor - Full-Factorial - Two Level Fractional - Mixture Experiments - Taguchi Robustness Concepts• Response Surface Methodology - Steepest Ascent/Decent - High Order Experiments• Evolutionary Optimization (EVOP)
• Control Charts - Theory, Objectives, Benefits - Variable Selection - Rational Sub-grouping - Selection/Application - Analysis - Moving Average - Exponentially Weighted Moving Average (EWMA) - CuSum• Process Capability Assessment
Design for Six Sigma• Quality Function Deployment (QFD)• Robust Design and Process - Functional Requirements - Noise Strategies - Tolerance Design - Tolerance and Process Capability• Design Analysis and FMEA• Reliability Fundamentals
Six Sigma Process and the Management Tools
• Business Case• Problem/Objective Statement• Project Scope• Project Goals• Project Definition• Project Charter• Identify Owners and Stakeholders• Identify Customers• Financial Benefits• Benchmarking• Team Leadership• Team Dynamics and Performance• Change Agent• Performance Measurements• Gap Analysis• High Level Process Mapping/ SIPOC(Suppliers, Inputs, Process, Output, and Customers) Design for Six Sigma
• Design for (X) - Manufacturing (DFM) - Cost (DFC) - Test (DFT) - Maintainability (DFMA) - Quality/Reliability (DFQ)• Special Design Tools - Inventive Problem Solving - Axiomatic Design
• Lean Enterprise - Lean Thinking - Theory of Constraints - Continuous Flow Manufacturing - Non-Value Added Activities - Cycle Time Reduction - Cost of Quality - Tools Visual Factory, Kanban, Poka-Yoke • Solution Implementation - Mistake-Proofing (Poka-Yoke) - Visible Enterprise
The Six Sigma Journey• Enterprise View• Leadership• Business Strategy• Organizational Goals/Objectives• Project Management Tools (N7) - Activity Network Diagram - Affinity Diagram - Interrelationship Digraph - Matrix Diagram - Prioritization Matrix/Grid - Tree Diagram - Process Decision Program Chart• What’s Next-Six Sigma Evolution
AnalyzeA
MeasureM
DefineD
ImproveI
ControlC
• Control Plans - Training - Documentation - Monitoring - Response - Systems and Structures• Total Productive Maintenance (TPM)• Best Practice Sharing/Translation