alessandro brun six sigma
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Six Sigma a way to reach Operational Excellence and get Out of the Crisis
Alessandro Brun Politecnico di Milano
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
About Myself
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
Concorde
One of the 20th century's great symbols of technological
achievement
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
Concorde
One of the 20th century's great symbols of technological
achievement
perhaps the most famous passenger jetliner in history.
But it was also commercially flawed. Its engines were
dirty and painfully noisy. It was banned from flying
supersonic over the United States because of the
sonic boom.
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
Concorde
Concorde was effectively blocked from entering the
crucial U.S. market when airlines in this country,
including TWA and Pan American, canceled orders.
"Looking back at the entire program, from beginning to
end, if you knew then what you know now, then
Concorde would never have been built," Bannister.
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
Concorde
On 25 July 2000, Air France Flight 4590 crashed in Gonesse, France, killing all 100 passengers and 9 crew members.
According to the official investigation conducted by the French accident investigation bureau (BEA), the crash was caused by a titanium strip that fell from a Continental Airlines DC-10 that had taken off minutes earlier. The metal fragment punctured a tyre on Concordes left main wheel bogie during takeoff.
Prior to the accident, Concorde had been arguably the safest operational passenger airliner in the world in terms of passenger deaths-per-kilometres travelled with zero.
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
Operations and Supply Chain Excellence
Today, competition is Supply Chain vs Supply Chain, no longer firm vs firm.
Supply Chain Strategy should identify Critical Success factors to gain a competitive
edge.
EFFECTIVENESS
In addressing
market needs
EFFICIENCY
In resources
utilization
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
Out of the Crisis!
A product, or service, possesses quality if it helps somebody and enjoys a good and sustainable market.
We have learned to live in a world of mistakes and defective products as if they were necessary to life. It is time to adopt a new philosophy in America.
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
Noteworthy approaches to solve the Efficiency-vs-effectiveness trade-off?
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis 10
Noteworthy approaches to solve the Efficiency-vs-effectiveness trade-off?
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
Noteworthy approaches to solve the Efficiency-vs-effectiveness trade-off?
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
Noteworthy approaches to solve the Efficiency-vs-effectiveness trade-off?
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
Noteworthy approaches to solve the Efficiency-vs-effectiveness trade-off?
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
In search of new paradigms?
Quality Cheap Prices Service
In this service centre we offer
While-U-Wait service
High quality repairs
at the best price in town!
Please pick two out of three.
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
What about the market?
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
The times they are a-changing
Supply Chain performances are even more critical, due to some recent trends:
Customer centric approaches Variety increases (explodes!)
Shorter product life-cycles
Shorter delivery Lead Times
Trading Up lower sostituibility (cfr. Trading Up: The New American Luxury, di M.Silverstein e N.Fiske)
Low Labour Cost Countries competition
Increasing regulations
Growing ethical/social responsibility
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
Six Sigma
WHAT IS SIX SIGMA? Six Sigma is a managerial approach aimed to create processes
capable of delivering what the customer wants. It was developed by Motorola in the
80s as a way to improve quality of manufacturing processes. A decade later, GE
transformed Six Sigma into a powerful and pragmatic company-wide process
improvement program, to obtain drastic improvements in both operations and business
(transactional) processes.
Basically, Six Sigma consists in:
focusing characteristics of the product/service that are critical to customers (CTQ)
defining adequate technical specifications for CTQs in order to achieve customer
satisfaction
improving capability of the processes whose output is a CTQ reducing their
variability and other causes of errors or defects in order to meet technical
specifications
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis 18
Six Sigma and the quest for more capable processes
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
Process out-of-Target Excess variability
Low-variability,
Centered process
Six Sigma and the quest for more capable processes
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
Six Sigma quality levels an analogy
Increasing the s level of a process requires exponential
improvements in terms of quality
Sweet Fruits
Process Redesign
Process Entitlement
Bulk Fruits
Process
characterization and
improvement Low-hanging Fruits
Seven basic tools
Ground Fruits
Logic and intuition
Sigma Level of a
process
DPMO (Defects per Million Opportunities)
6 3.4
5 233
4 6,210
3 66,800
2 308,000
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis 21
- Lost Opportunities
- The Hidden Factory
- More Setups
- Expediting Costs
- Lost Sales
- Late Delivery
- Lost Customer Loyalty
- Excess Inventory
- Long Cycle Times
- Costly Engineering Changes
For most companies, COPQ can be as high as 15% of total sales
Hidden Costs:
- Intangible
- Difficult to Measure
Traditional Quality Costs:
- Tangible
- Easy to Measure
- Inspection
- Warranty
- Scrap
- Rework
- Rejects
Costs of Poor Quality (COPQ)
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis 22
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
2 3 4 5 6
Co
st o
f Q
ua
lity
% S
ale
s
Sigma Level
Costs of Poor Quality (COPQ) vs Sigma Level
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
Tools Organization
Methodology
Process variation
LSL USL
Upper/Lower specification
limits
Regression
Driven by
customer
needs
Enabled by quality team
Led by Senior Mgmt
Define Measure
Analyze Improve Control
VendorVendorProcess BProcess BProcess AProcess ACustomerCustomer VendorVendorProcess BProcess BProcess AProcess ACustomerCustomer
Process Map Analysis
0
5
10
15
20
25
30
35
L K A F B C G R D
0%
20%
40%
60%
80%
100%
Frequency Cumulative Frequency
Pareto Chart
Six Sigma dimensions
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis 24
Champions
Black Belts
Executive sponsorships
Master Black Belts
Quality Management
Mario Cappetta
Roles of Six Sigma expert
They identify key business issues and assist
the champions in identifying critical projects
that are tied to the key business issues
They define the projects and keep track of
the team's progress
They provide coaching, training and statistical
expertise to Black Belts
They are responsible for implementing the Six
Sigma projects
Green Belts
They are team members who maintain their
regular jobs but are assigned to one or more
teams given their know-how or background on
the selected projects
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis 25
Project Phases
Focusing the process object of improving D
Define
M
Measure
A
Analyze
I
Improve
C
Control
Measuring current processs performances
Identifying the causes of the problem
Removing the causes of the problem
Verifying that the results of the project have been
realized
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SIX SIGMA a way to reach Operational Excellence and get Out of the Crisis
Six Sigma and Lean are two complementary approaches
Lean and Six Sigma integrate each other, making Lean Six Sigma a powerful general
purpose process improvement methodology to reach Operational Excellence
SIX SIGMA LEAN THINKING
Main focus of the methodology Improving process quality - create
processes capable of delivering what the
customer wants.
Improving process quality
the right process will bring to the right
results
Goal Reducing variation and aligning
processes to target
Reducing variation, eliminating wastes
and avoiding overburden
Cultural context in which it was
originated
Western (USA) Eastern (Japan)
Type of improvements sought after Project-by-Project Day-by-Day
Organization and roles Strongly formalised hierarchy of highly
qualified improvement experts (GB, BB,
MBB, )
Informal organization everybody
should contribute
Approach to improvement actions
identification and implementation
Top-Down Bottom-Up
Tools Abundant use of sophisticated statistical
tools
Mainly relies on simple visual tools