The History of Six SigmaThe roots of Six Sigma as a measurement standard can be traced back to Carl Frederick Gauss (1777-1855) who introduced the concept of the normal curve. Six Sigma as a measurement standard in product variation can be traced back to the 1920's when Walter Shewhart showed that three sigma from the mean is the point where a process requires correction. Many measurement standards (Cpk, Zero Defects, etc.) later came on the scene but credit for coining the term "Six Sigma" goes to a Motorola engineer named Bill Smith. (Incidentally, "Six Sigma" is a federally registered trademark of Motorola).

In the early and mid-1980s with Chairman Bob Galvin at the helm, Motorola engineers decided that the traditional quality levels -- measuring defects in thousands of opportunities -- didn't provide enough granularity. Instead, they wanted to measure the defects per million opportunities. Motorola developed this new standard and created the methodology and needed cultural change associated with it. Six Sigma helped Motorola realize powerful bottom-line results in their organization - in fact, they documented more than $16 Billion in savings as a result of our Six Sigma efforts.

Since then, hundreds of companies around the world have adopted Six Sigma as a way of doing business. This is a direct result of many of America's leaders openly praising the benefits of Six Sigma. Leaders such as Larry Bossidy of Allied Signal (now Honeywell), and Jack Welch of General Electric Company. Rumor has it that Larry and Jack were playing golf one day and Jack bet Larry that he could implement Six Sigma faster and with greater results at GE than Larry did at Allied Signal. The results speak for themselves.

Six Sigma has evolved over time. It's more than just a quality system like TQM or ISO. It's a way of doing business. As Geoff Tennant describes in his book Six Sigma: SPC and TQM in Manufacturing and Services: "Six Sigma is many things, and it would perhaps be easier to list all the things that Six Sigma quality is not. Six Sigma can be seen as: a vision; a philosophy; a symbol; a metric; a goal; a methodology." We couldn't agree more.

 

Six Sigma - What is Six Sigma?

Six Sigma at many organizations simply means a measure of quality that strives for near perfection. Six Sigma is a disciplined, data-driven approach and methodology for eliminating defects (driving towards six standard deviations between the mean and the nearest specification limit) in any process -- from manufacturing to transactional and from product to service.

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The statistical representation of Six Sigma describes quantitatively how a process is performing. To achieve Six Sigma, a process must not produce more than 3.4 defects per million opportunities. A Six Sigma defect is defined as anything outside of customer specifications. A Six Sigma opportunity is then the total quantity of chances for a defect. Process sigma can easily be calculated using a Six Sigma calculator.

The fundamental objective of the Six Sigma methodology is the implementation of a measurement-based strategy that focuses on process improvement and variation reduction through the application of Six Sigma improvement projects. This is accomplished through the use of two Six Sigma sub-methodologies: DMAIC and DMADV. The Six Sigma DMAIC process (define, measure, analyze, improve, control) is an improvement system for existing processes falling below specification and looking for incremental improvement. The Six Sigma DMADV process (define, measure, analyze, design, verify) is an improvement system used to develop new processes or products at Six Sigma quality levels. It can also be employed if a current process requires more than just incremental improvement. Both Six Sigma processes are executed by Six Sigma Green Belts and Six Sigma Black Belts, and are overseen by Six Sigma Master Black Belts.

According to the Six Sigma Academy, Black Belts save companies approximately $230,000 per project and can complete four to 6 projects per year. General Electric, one of the most successful companies implementing Six Sigma, has estimated benefits on the order of $10 billion during the first five years of implementation. GE first began Six Sigma in 1995 after Motorola and Allied Signal blazed the Six Sigma trail. Since them, thousands of companies around the world have discovered the far reaching benefits of Six Sigma.

Many frameworks exist for implementing the Six Sigma methodology. Six Sigma Consultants all over the world have developed proprietary methodologies for implementing Six Sigma quality, based on the similar change management philosophies and applications of tools.

Other Areas Of Interest To You

The Cost Savings of Six Sigma Quality DMAIC or DMADV: Which Six Sigma Methodology Should You Use? Six Sigma Training Developing a Six Sigma Organization Understanding Six Sigma - Body of Knowledge Six Sigma Certification A Typical Six Sigma Project Additional Six Sigma Q&A - Frequently Asked Questions Can't Find An Answer? Ask Your Question On The Discussion Forum

SSix Sigma

The goal of Six Sigma is to increase profits by eliminating variability, defects and waste that undermine customer loyalty.

Six Sigma can be understood/perceived at three levels: 1. Metric: 3.4 Defects Per Million Opportunities. DPMO

allows you to take complexity of product/process into account. Rule of thumb is to consider at least three opportunities for a physical part/component - one for form, one for fit and one for function, in absence of

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better considerations. Also you want to be Six Sigma in the Critical to Quality characteristics and not the whole unit/characteristics.

2. Methodology: DMAIC/DFSS structured problem solving roadmap and tools.

3. Philosophy: Reduce variation in your business and take customer-focused, data driven decisions.

Six Sigma is a methodology that provides businesses with the tools to improve the capability of their business processes. This increase in performance and decrease in process variation leads to defect reduction and vast improvement in profits, employee morale and quality of product.

Here's an article with more detail on defining Six Sigma: What is Six Sigma?

-------Six Sigma is a rigorous and a systematic methodology that utilizes information (management by facts) and statistical analysis to measure and improve a company's operational performance, practices and systems by identifying and preventing 'defects' in manufacturing and service-related processes in order to anticipate and exceed expectations of all stakeholders to accomplish effectiveness.

Six Sigma Deployment

By Shree Phadnis

All Six Sigma proponents agree to the fact that the key to Six Sigma improvement success is the building up of an effective infrastucture. An effective infrastructure lays the foundation for the success of the organization in its implementation of Six Sigma. It is a known fact today that the success of Six Sigma lays on the projects selected and their link to the strategy of their organization. There have been enough publications on the selection of projects and the filters to be used for the prioritization of projects, however there are not enough details available on the building the key infrastructure for the deployment of Six Sigma.

When we discuss the building up of an implementation structure what we are embarking on is a project in itself, which follows the DMAIC (Define, Measure, Analyze, Improve and Control) methodology:D: Define the Strategic Direction of the organization

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M: Set Measures for the strategic objectives of the organizationA: On a continual basis collect data on the measures set and analyse using Six Sigma tools and techniquesI: Identify the opportunities for improvement and convert them to Six Sigma projects for improvementC: Set up a management control action of continuous reviews on the improvements made on the Six Sigma Projects

The objectives of the Define and Measure phase of this project are defined as below:

1. Building up a set of metrics for the organization that give definition to the organizations Vision

2. Metrics that are Integrated with the Strategic direction and objectives of the organization

3. Metrics that align people and work with their strategic objectives 4. Metrics that serve as effective means of communication for the organization

both horizontally and vertically. 5. Metrics that provide insight needed for making decisions, setting direction and

correcting course. 6. Metrics which will serve as a continuous source for identifying gaps in the

organization and plugging them with Six Sigma Projects

The problem most organizations face in the phases of Define and Measure is how to build such an organizational dashboard, which will help achieve the objectives cited above. First StepThe first step an organization needs to embark on is conducting a self-assessment based on proven assessment models like the Malcolm Baldrige which will help the organization in understanding its "as is" state more clearly and help identify the various opportunities for improvement. The organizations could use the checklist type of approach in conjunction with interviews for identifying the gaps in Approach-Deployment-Results. Once the assessment of the organization is completed the findings need to be shared with the top management and the employees. This step is extremely crucial as this is what binds the organization together and helps create the cultural change needed aspect within the organization combined with the need for Six Sigma.

Second StepOnce the first step is conducted the organization is now clear about its current strategies for growth and customer statisfaction. Based on the assessment conducted the organization can re-evaluate all its strategies and strategic objectives. New strategic objectives can now be identified.

Third StepMost organizations after having articulated and identified their various objectives are unable to communicate the strategies of the organization. One of the most effective methods for communicating the strategy of the organization is building a strategy map encompassing the now widely adopted Kaplan and Norton's Balanced score card spanning the four perspectives. Answering the questions related to the perspectives helps understand the strategy better and also build a good strategy map. The strategy map helps provide the vital cause and effect linkages in an organization and helps link the Business processes to the strategic destination of the organization. Before attempting to build the map it is essential for the organization to identify all its core processes and support processes as they help in completing the strategy map.

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The Four Perspectives

The Balanced score card perspectives help an organization to integrate and operationalise the organizations strategy.

As an example for the application for the application of the method consider a hypothetical case mentioned below. This case utilizes the frequently used Catapult in the Six Sigma black belt training and explains the concept.

XYZ is a company that is newly set up. It is in the business of delivering thrown balls to customer specifications. It has a vision of being a leading international player in the business of thrown balls by the Year 2005. It hopes to achieve this through high volumes and low cost by being the lowest cost producer. The company values its customers very strongly and believes in customer retention as its strength. In order

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to meet this vision the company CEO has ordered the latest state of the art machinery -- the Catapult -- for a cost of 10 Million Dollars.

The business of thrown balls is a relatively new business. In prior years, potential customers of this business had their own machinery and set-ups to meet their internal requirements. Today, where organizations are focusing on their core activities, various users of thrown balls are contemplating outsourcing this activity, making this business a very viable potentially high earning business.

XYZ has to market their product from scratch where they have to identify the markets and generate the marketing demands. International threats from Chinese products is very high. The Chinese products are known to be supplied at a very low cost making them potentially high threat to the industry. Apart from the Chinese threat there are four other Indian competitors.

The key requirements of customers are the consistency in the distance the ball is thrown from the base of the catapult. Variation from the center of the base is also critical, however, the customer might accept products offered with variation beyond specifications subject to customers approval. Delivery on time is one of the key requirements of the customer.

To service the customers properly the CEO has decided to operate through three sales and marketing outlets and two manufacturing units strategically located.

The spares of the machinery imported are not available freely in India. The organization cannot afford downtime of machines and has taken necessary steps to ensure that the machines are in the best of shape.

The management has decided that it needs to keep a control on the costs while developing business. The main raw material for the product is the balls and they are available freely in India. The marketing department has just received a hot inquiry from a potential client. This customer is one of the largest potential customers in the market.

The customer needs are that he wants balls to be delivered at 75+- 3 inch from the base of the catapult. The ball delivered to be +-2 inch from the center of the base (axial requirement). The customer needs 50 balls delivered within 10 miniutes. For balls that do not meet the requirement of +-2 axially but are in the +- 3-inch specification, the customer will buy the material at a 10% discount. Selling price of each correct ball delivered is $1000. Despite stiff competition from the Chinese on the price front, your marketing manager has been able to get this pilot order.

Raw material price for the ball is $500.

Six Sigma Deployment

By Shree Phadnis

First Page > Six Sigma Deployment Introduction

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It is very difficult to articulate the strategies of the organization in this given scenario. Withith help of the Kaplan and Norton score card philosophy presented earlier, it is fairly easy and at the same time enlightening for the organization to build the business process model and then continue on the strategy map of the organization. Below is shown a possible process model for the organization depicted earlier.

A possible strategy map for the organization depicted is shown below. Articulation of the strategy in a map as shown below helps clarify the strategic objectives of the organization and serves as an excellent communication tool to all in the organization so that there is a common understanding and alignment within the organization.

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Fourth StepOnce the strategy map is completed the organization can now start looking at each of the objectives in the shareholders and customer perspectives, and identify various measures that will help in achieving the strategy. When identifying measures, organizations must try to focus on what needs to be measured to achieve the strategy rather than plug existing measures into the objectives. Measures selected need to have a right balance between Lead and Lag. Lag measures are metrics that are obtained after the event is over, whereas Lead measures are metrics that tend to measure the drivers that help reach the destination.

Identify the various benchmarks in the Industry for the various measures selected. Based on the current level of performance decide on targets for the organization. Below is an example of metrics for the strategic objective "XYZ always delivers to my needs".

Fifth StepFor the key core and support processes, develop high level process maps based on the concept of SIPOC (Supplier, Input, Process, Output and Customer). The process model developed earlier serves as an excellent resource. Identify key metrics for each of these processes. Return back to the strategy map developed and for each of the process strategic objectives select appropriate measures linking both the

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customer perspective measures identified in step four to the process perspective measures identified. Select process strategic objectives measures that reflect the customer's viewpoint. Conventional Six Sigma metrics like DPMO, Sigma Level, or Rolled Throughput Yield may be appropriate. Once the measures for the process strategic objectives are identified, identify measures for the learning and growth perspectives. As discussed earlier, remember to balance in Lead and Lag measures and identify suitable benchmarks for these measures.

Sixth StepDeploy the organizational score card at the departmental level. During the deployment of the scorecard break up the measures as applicable to the department. This would ensure that the organization has appropriate metrics at all levels and and that they are integrated both vertically and horizontally within the organization.

Seventh StepOnce the organization is hardwired with the metrics, start collecting data on the metrics and identify on a continual basis various gaps in the organization. The champions training received by the Senior Management will be extremely useful in this phase as the champions will analyse data based on the type of cause (special or common) and then would work on whether a potential project is identified or not.

An implementation structure of Six Sigma modeled on this method is a sure fire method for ensuring maximum benefits from the Six Sigma strategy deployed within the organization.

"When you can measure what you are speaking about and express it in numbers you know something about it, but when you cannot measure it,

when you cannot express it in numbers, your knowledge is of a meagre and unsatisfactory kind." --Lord Kelvin

Is Six Sigma Just For Large Companies? What About Small Companies?

By Charles Waxer

Almost all Quality professionals have heard of the benefits of Six Sigma Quality. How can it be ignored? Companies like GE, Motorola, and AlliedSignal have already saved billions of dollars with their Six Sigma Quality initiatives. According to Jack Welch, GE CEO, "the financial rationale for embarking on this quality journey is clear." But are the results of a Six Sigma implementation as clear for small companies?

The Requirements of Six SigmaLet's first start with a short list of requirements for successfully implementing Six Sigma quality in any organization. Then we'll discuss the requirement differences in relation to large and small companies.

While many other requirements are applicable, I personally believe that these are the most important:

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Management Team Buy-In and Support Education and Training Resource Committment Link to Compensation Management Team Buy-In and SupportIf your executive team is not fully supportive and proactive in establishing your Six Sigma Quality initiative, you will be wasting everyone's time. As with any successful initiative implementation, everyone's actions need to be tied to the initiative.

A useful exercise in determining buy-in is to list out all the individuals of the management team on a piece of paper. Then assign a positive, neutral or negative to each person signifying what you believe to be their support for the initiative. Your job, before beginning the implementation, is to move every single person to at least a neutral position, if not positive. Education can help with this goal.

Education and TrainingMany educational programs currently exist; most provided by consulting companies. A list of the most reputable consultants can be found in the Six Sigma Consultants category of the iSixSigma library.

What training is necessary? Well, it depends on who is getting trained. Here's a snapshot table identifying the major groups of individuals, the suggested training agenda, approximate cost and duration of the training.

Training Your Business or OrganizationGroup MajorTopics ApproximateCost Per Person DurationManagement Team and Champions

* Six Sigma Overview* Benefits and Case Studies* How To Implement Six Sigma* Tools and Resources

$1,000-$2,500 1-5days

Selected Six Sigma Leaders (Black Belts and Master Black Belts)

* Six Sigma Overview* Six Sigma Methodology and Tools* Statistics Training* Computer Application Training* ProjectSelection and Execution

$12,000-$50,000 4 weeks delivered over a period of 2-6 months

All Employees

* Six Sigma Overview* Benefits* What To Expect Going Forward* Simple Case Study and Exercise

Variable, depending on if taught in-house or if consultant (approximately $2,000 per day plus expenses) is used

0.5-1day

Resource CommittmentAs discussed above, Black Belts (BBs) and/or Master Black Belts (MBBs) need to be identified and trained. But more importantly, they need to be assigned to your Six Sigma efforts almost 100%; 50% application yields less than a 50% result. In addition to BBs and MBBs, you should be ready to assign 5-15% of key employees' time to specific projects.

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Link to CompensationWe all work and perform responsibilities for a paycheck, right? Just as you expect your factory to produce Y widgets per hour and your bank to process Z deposits per day, you should expect projects to be contributed to and successfully completed in a prescribed time period. And employees executing well should be compensated well. The quickest way to initiative success is to tie results to the business bottom line, create performance goals, and compensate employees appropriately.

Is Six Sigma Just For Large Companies? What About Small Companies?

By Charles Waxer

In the first part of this article, we looked at four major requirements for successfully implementing Six Sigma quality within your organization -- regardless of the size of your organization. They are:

Management Team Buy-In and Support Education and Training Resource Committment Link to Compensation Now, we'll look at each of these areas with application to small companies. After each major requirement will be a synopsis and discussion around whether it is easier to implement Six Sigma Quality in a small company or a large company.

Application of Six Sigma to Small Companies

Management Team Buy-In and Support  EasierCompared to large companies, small company management teams are typically closer on a personal basis. Pulling the small company team together for a short meeting can be done in minutes, as opposed to days for a large company. Because smaller companies are more agile, it is typically easier to achieve management team agreement that a standard methodology can help achieve results. Although politics are always present, less may be required in a smaller company to come to agreement and buy-in for implementing Six Sigma Quality.

Education and Training  HarderAlthough the costs presented on page 1 are somewhat standard, buying in bulk always produces a discount. This is the main reason I believe education and training is harder (costlier) for smaller companies. Time is money -- time away from the office is lost revenue and production for both small and large companies alike. But the return on investment is a function of the potential savings of the business. For a behemoth like GE or Motorola, standardized processes can yield enormous savings -- a large potential exists prior to implementing Six Sigma. For a smaller companies, the savings potential may not be as great. The return on investment may not be as quick

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or as significant. You know your business and processes better than anyone else. How great are the potential savings?

Resource Committment  Slightly HarderThe key issue here is employee time. As mentioned above, time is money for both employees that are partially assigned to teams and project leaders. BUT -- we must remember to see the forest through the trees. Any time dedicated to process improvement will be recouped in process productivity going forward for all time. But it again boils down to the potential savings that are available in your business.

Link to Compensation  EasierNo brainer. Being able to link compensation to Six Sigma implementation is much easier in a small company, compared to a larger company. Decisions in general are quicker for small companies, that's why they are more agile. The key will be applying the rigor and written procedures that larger companies do well. Formal performance appraisal systems need to identify what is to be accomplished, what success looks and feels like, and how an employee will be compensated. Just be sure to involve your Human Resources representative to ensure that employee responsibilities are being modified in the appropriate manner.

Only after reviewing your unique business landscape will you be able to determine if your small business climate is right for implementing Six Sigma Quality. I hope the above discussion triggers your own thoughts and discussions within your business. Good luck!

Calculating the Cost and Savings of Six Sigma Quality

By Charles Waxer

One of the most distinct differences between Six Sigma and other quality management systems is the link to business finances. Financial benefits of potential process improvement projects are quantified and used to help select and prioritize process improvement projects. Financial benefits are re-evaluated during the analyze phase to ensure that the cost of improvements suggested will be supported by the benefit of the project. And finally, the financial benefits are verified once the project enters the control (for DMAIC) and verify (for DMADV) phases.

The rigor associated with linking Six Sigma projects to business financials helps connect everyone within the business -- not just the quality department and related personnel. The entire organization, including the CEO, CFO, line managers, employees, and shareholders, looks to Six Sigma to increase cost savings, productivity, and incremental revenue. It also helps differentiate substantial process improvements from insignificant 'fluff' projects that have little long-term benefit for the business.

Below are a few posts from fellow quality professionals discussing how best to link quality to finances. If you have a question or would like to make an additional comment, just press the 'Post A Reply' button.

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"During the Define and Measure phase, we highlight what the project is supposed to do and how it is supposed to do it. Most of the time, maybe due to human natural tendencies, the improve phase is already running at the back of everyone's minds. "To forecast financial savings, we try to follow suit thatTangible benefits - cost of project implementation = Financial benefits.

"Under each category like tangible benefits, we try to break it further down to cost of sales, tax savings and all the financial jargon along with it. The cost of project implementation will be labour cost and all other liabilities that arises from doing the project. And with that, we try to give the most accurate forecast as we can during the D and M phase.

"As the project goes along, there may be some changes and we update this forecast to be even more accurate and revise the financial plan for approval."

Posted by: Dominic Lai 

DMAIC Versus DMADV

By Kerri Simon

We know that everything in business is a process, right? Sales people have a list of companies and contacts that they work in a certain fashion to produce a sale, production receives an order and schedules the manufacturing, the product is built, packaged, shipped and invoiced. When the packing department has a problem with their process, though, should they fix it with a DMAIC or DMADV (also referred to as DFSS) type project?

The Similarities of DMAIC and DMADVLet's first look at the DMAIC and DMADV methodologies and talk about how they're alike. DMAIC and DMADV are both:

Six Sigma methodologies used to drive defects to less than 3.4 per million opportunities.

Data intensive solution approaches. Intuition has no place in Six Sigma -- only cold, hard facts.

Implemented by Green Belts, Black Belts and Master Black Belts. Ways to help meet the business/financial bottom-line numbers. Implemented with the support of a champion and process owner.

The Differences of DMAIC and DMADVDMAIC and DMADV sound very similar, don't they? The acronyms even share the first three letters. But that's about where the similarities stop.

DMAIC Define Measure  Analyze   Improve

Define the project goals and customer (internal and external) deliverables

Measure the process to determine current performance

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    Control Analyze and determine the root cause(s) of the defects

Improve the process by eliminating defects

Control future process performance

When To Use DMAICThe DMAIC methodology, instead of the DMADV methodology, should be used when a product or process is in existence at your company but is not meeting customer specification or is not performing adequately.

DMADV Define Measure  Analyze   Design    Verify

Define the project goals and customer (internal and external) deliverables

Measure and determine customer needs and specifications

Analyze the process options to meet the customer needs

Design (detailed) the process to meet the customer needs

Verify the design performance and ability to meet customer needs

When To Use DMADVThe DMADV methodology, instead of the DMAIC methodology, should be used when:

A product or process is not in existence at your company and one needs to be developed

The existing product or process exists and has been optimized (using either DMAIC or not) and still doesn't meet the level of customer specification or six sigma level

"I Thought it was a DMAIC, But it Turned Out to be a DMADV!"Occasionally a project is scoped as a DMAIC for incremental process improvement when it really required a DMADV methodology improvement. And it was a month into the project that you realized this! Don't be discouraged about the work you put into the DMAIC because 1) it's happened to more businesses than just yours, 2) you understand the process at a much greater detail than you did initially, and 3) you were able to practice not just DMAIC skills but also DMADV!

Pick yourself up, dust yourself off and re-craft your define piece of the project so you can begin with a fresh look at the project and solutions. You never know what insights you'll have now that you may not have been aware of before

Six Sigma TrainingBy Charles Waxer

Implementing Six Sigma within your organization is similar to implementing any other company-wide initiative. Determining the content and framework, developing the materials, and rolling it out to the company is only half of the necessary work. The other half is changing the culture.

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Training is one of the most important factors that contributes to and helps modify and shape a Six Sigma culture. This article will help identify who in your organization is required to be trained and what type of training they should receive.

Who and What Type of Training?Senior ManagementSenior Management, also known as 'C-Level Management' (CEO, CIO, CFO and peers), are the individuals that set, communicate and drive the overall business objectives. They are also the individuals that are required to incorporate Six Sigma objectives into their operational plans. Examples of objectives might include:

X% of employees trained by a certain date Y% reduction in defects for all customer visible processes by quarter end $Z in back-office projects savings by year end Training for Senior Management should include a program overview, business and financial benefits of implementation, real-world examples of successful deployments, specific application to business/industry, and the required training and tools to ensure successful implementation. Depending on Senior Management time availability and their desire to learn the details, Black Belt training is also recommended.

Functional / Process ManagersFunctional and Process Managers are the level of management directly reporting to the Senior Management. Depending on the size of the organization, they might include functional managers from areas such as human resources, finance and training, and process managers from areas such as assembly, production and call center.

These managers are sometimes referred to as 'sponsors' and 'champions' because they are known to champion the cause within their business organization. These champions translate Senior Management's strategic directions into tactical objectives and actions with the help of their Quality Leader and Project Leaders.

Training for Functional and Process Managers is more detailed than that provided to Senior Management. Topics would include the Six Sigma concept, methodology, tools and requirements to ensure successful implementation within their organization. Depending on Functional / Process Manager time availability and their desire to learn the details, Black Belt training is also recommended.

Quality LeadersQuality Leaders, also known as Quality Managers and Master Black Belts, help Functional and Process Managers set and lead the Six Sigma vision within their specific areas. They maintain rolled up budgets, track business cost savings, ensure training goals are met, coach Functional and Process Managers, Project Leaders and Employees, review projects at milestones, share best practices, and ensure appropriate use of tools and methodologies.

Training for Quality Leaders includes detailed information about the concept, methodology and tools, as well as detailed statistics training and computer analysis tool use. Depending on the instructor, the duration is usually between three and four weeks.

Project LeadersProject Leaders, also known as Black Belts, implement the Six Sigma methodology

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and tools within the business. They lead the intra- and inter-function projects, maintain time lines and budget, determine appropriate tool use, perform analyses, and act as the central point of contact for specific process improvement projects.

Training for Project Leaders includes detailed information about the concept, methodology and tools. Depending on the instructor, the duration is usually between two and four weeks, and may include one of more weeks in between sections. Statistics is included in the agenda, but typically does not include as much detail as that provided to Quality Leaders.

EmployeesEmployees, also known as Green Belts, may also take training courses developed specifically for part time Project Leaders. Training is similar to Black Belt training, but shorter in duration because less detail on complex tools and statistics is provided. Employees are instead told to ask their Black Belt for help in specific areas.

Training InformationiSixSigma's intent over the upcoming weeks is to gather all available training information for your use -- by training course, geographic location (city, state, country), cost per individual, and much more. Be sure to sign up for the iSixSigma Insights newsletter to be notified of its availability. If you are a consultant or training group that offers training for groups listed above, please send an email with information about your training to articles@iSixSigma.com. Please don't write to iSixSigma asking for a list of training in your area; unfortunately we don't have a list available yet. Instead, visit the iSixSigma Calendar for the latest information on available training.

Six Sigma Organizational ArchitectureBy Charles Waxer

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Six Sigma is a quality methodology that can produce significant benefit to businesses and organizations. Not much text, however, has been written about the structure needed to successfully implement Six Sigma quality within your business or organization. This article will focus on roles and responsibilities, as well as required rewards and recognition for a successful Six Sigma quality program.

Roles and ResponsibilitiesQuality Leader/Manager (QL/QM) - The quality leaders's responsibility is to represent the needs of the customer and to improve the operational effectiveness of the organization. The Quality function is typically separated from the manufacturing or transactional processing functions in order to maintain impartiality. The quality manager sits on the CEO/President's staff, and has equal authority to all other direct reports.

Master Black Belt (MBB) - Master Black Belts are typically assigned to a specific area or function of a business or organization. It may be a functional area such as human resources or legal, or process specific area such as billing or tube rolling. MBBs work with the owners of the process to ensure that quality objectives and targets are set, plans are determined, progress is tracked, and education is provided. In the best Six Sigma organizations, process owners and MBBs work very closely and share information daily.

Process Owner (PO) - Process owners are exactly as the name sounds -- they are the responsible individuals for a specific process. For instance, in the legal department there is usually one person in charge -- maybe the VP of Legal -- that's the process owner. There may be a chief marketing officer for your business -- that's the process owner for marketing. Depending on the size of your business and core activities, you may have process owners at lower levels of your organizational structure. If you are a credit card company with processes around billing, accounts receivable, audit, billing fraud, etc., you wouldn't just have the process owner be the chief financial officer, you would want to go much deeper into the organization where the work is being accomplished and you can make a big difference.

Black Belt (BB) - Black Belts are the heart and soul of the Six Sigma quality initiative. Their main purpose is to lead quality projects and work full time until they are complete. Black Belts can typically complete four to six projects per year with savings of approximately $230,000 per project (see earlier reference). Black Belts also coach Green Belts on their projects, and while coaching may seem innocuous, it can require a significant amount of time and energy.

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Green Belt (GB) - Green Belts are employees trained in Six Sigma who spend a portion of their time completing projects, but maintain their regular work role and responsibilities. Depending on their workload, they can spend anywhere from 10% to 50% of their time on their project(s). As your Six Sigma quality program evolves, employees will begin to include the Six Sigma methodology in their daily activities and it will no longer become a percentage of their time -- it will be the way their work is accomplished 100% of the time.

Now we know how some companies have organizationally structured their Six Sigma quality program. But how do you ensure that everyone's doing their job? How do you keep your employees motivated when fires are burning all over the corporate landscape?

Six Sigma Organizational Architecture - Rewards and Recognition

By Charles Waxer

Six Sigma is a quality methodology that can produce significant benefit to businesses and organizations. Not much text, however, has been written about the structure needed to successfully implement Six Sigma quality within your business or organization. Page 1 > Six Sigma Architecture focused on roles and responsibilities of a successful Six Sigma quality program. This page focuses on the rewards and recognition associated with a successsful Six Sigma quality program.

Rewards and RecognitionWe all know that roles assignment is not enough to start and maintain a successful Six Sigma quality program. Rewards and recognition must be part of the equation. So how do we reward the different roles within the organization? Let's start with the Green Belts and work our way back up the organization.

Green Belts - Depending on the size of the project and the resulting benefits, gift certificates, cash and stock options are all motivating factors. But don't underestimate the motivating power of a public congratulations in front of peers -- it is many times even more effective than a monetary amount. Depending on the progress of your program, you may want to tie their salary action to the results of the project(s) they completed during the past year.

Black Belts and Master Black Belts - Their salary and bonus structure should be tied to the number of projects and benefit of those projects to the business bottom line. Metrics including productivity, loss reduction, improved quality, reduced overhead, etc. should all be factors in determining the proper payout for performance. For under performing BBs and MBBs, the performance appraisal meeting should serve as a fulcrum in modifying their behaviors and actions.

Process Owners - Here's one of the key roles that needs to be defined properly. The Process Owner's compensation (salary and bonus) must be tied directly to quality efforts within their organization. It's not enough to allow Quality to 'work with us,' but their metrics and efforts need to be utilizing all of the quality tools appropriately. Why not make 25% of their bonus tied to meeting their quality initiative goals and objectives? Then have them report on how they did before you determine the bonus payout.

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Quality Leader - Performance based compensation (salary and bonus). Leadership capabilities are critical to this position, so not only should the quantitative aspects (savings, projects, training, etc.) be measured, but so should the qualitative. The difficulty arises in defining and clearly identifying the required behaviors.

CEO - The buck stops here. If the CEO is fully on board with the Quality initiative, s/he will have no problem tying the compensation of her/his direct reports to Quality deliverables.

Don't be shy about asking to tie compensation to your Six Sigma Quality initiative. It's the only way you'll truly have your entire organization focused around the customer and the quality of your processes and deliverables.

Six Sigma Curriculum and Body of Knowledge

By Charles Waxer

iSixSigma receives many questions regarding the Six Sigma methodology and, more specifically, what each business change agent (Champion, Master Black Belt, Black Belt, Green Belt) should know in order to be effective. To help meet this need, I have created a reference document detailing what should be contained in a Six Sigma curriculum. Below is iSixSigma's recommendation for a body of knowledge for Six Sigma. You may find it useful when selecting a Six Sigma provider or completing training to ensure you are learning all appropriate topics.

It is the belief of this author and iSixSigma that Master Black Belts and Black Belts should possess the same detailed knowledge of process improvement and statistical analysis, although the two roles vary significantly in other ways (see Organizational Architecture). For this reason, all of the key understanding areas listed under the DMAIC sections for the Master Black Belt and the Black Belt are identical.

Champion / Process Owner Curriculum and Body of Knowledge Master Black Belt (MBB) Curriculum and Body of Knowledge Black Belt (BB) Curriculum and Body of Knowledge Green Belt (GB) Curriculum and Body of Knowledge If you feel that some relevant topic is missing from the curriculum or body of knowledge of any of the areas listed above, please send an email to iSixSigma.

Additional ResourcesSix Sigma Organizational Architecture - Successful Six Sigma Quality programs are built on a solid organizational foundation. The organizational structure and rewards/recognition system needs to be clearly identified and communicated to successfully implement Six Sigma Quality.

Master Black Belt and Black Belt - Resources for Six Sigma Master Black Belts and Black Belts.

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What Is Six Sigma Certification? – Revisited

By Charles Waxer

Six Sigma certification questions continue to roll into my inbox. While I can't find time to answer each email with a tremendous amount of detail, I can and do save them for answering in an article such as this. This article revisits a previously published article What is Six Sigma Certification? published last year. If you find a question missing or would like clarification on a specific topic, please submit it along with any thoughts you have.

Jump To The Following Answers:

Can My Company Certify Six Sigma Yellow/Green/Black/Master Black Belts? What Are The Legal Implications Of Six Sigma Certification? Can Non-Certified Master Black Belts Mentor Black Belts?? Are There Other Certification Companies Besides Those Listed On iSixSigma? What Are The Requirements For A Consulting Company To Provide Six Sigma Certification? Can My Company Certify Six Sigma Yellow/Green/Black/Master Black Belts?Six Sigma certification is a funny concept. Everyone wants to be certified, but nobody really understands what it means in the industry and how it might enhance your resume outside your current company.

If you take a look at my previous answer How Can I Get Six Sigma Certified, you'll see that there isn't a single certification body for Six Sigma. Because of this, you'll find certification options from consulting companies (like the one that probably trained and certified the first wave in your business) and ASQ, as well as from businesses like Motorola, Allied Signal, GE, and many others. Each of these businesses has different certification criteria. And so to answer this question, the answer is Yes. Yes, you can certify anyone you want to any standards you think are appropriate. Provide instruction, test for knowledge and hand out certificates.

But the question should not be "Can I certify Green or Black Belts in my company?", the real question should be "What is the true value of all these certifications?"

What is the value of the content being instructed? How well is the content being instructed? Does the content cover all pertinent aspects of Quality and management that

every change agent should know? Has the content not only been learned, but been put into practice and

successfully utilized? Has the knowledge of individuals been tested to acceptable levels? Have processes been defined, measured, analyzed, improved and controlled

for the better of the organization?

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Ok, now that I have that idealist thinking of my system, let's get to what I feel is the true question that people should be asking, "What is the street value of the certification?" Why do I say street value? Because that's where the rubber hits the road and you show what you know and what you don't. For example, no business is going to hire a graduate of Wharton (arguably the most prestigious business school in the U.S.) without asking her to explain business concepts or to apply a model to a hypothetical business situation. Sure she comes with a pedigree from a top 5 institution, but these types of questions help the hiring manager evaluate the candidate's level of understanding. Similarly, a Quality manager interviewing a Black Belt or Master Black Belt candidate is going to ask how she facilitated a difficult team meeting, to explain what a Z value is, and to differentiate and explain the p values associated with a recent project. That is the true test of a person's Six Sigma value to the organization.

Finally, wouldn't it be nice if everyone was valued for the contributions they have made or will make to the business? The fact is that pedigrees are important to people -- which is exactly why this certification question came up in the first place. Since there aren't any independent firms determining the "value" of certification from the many available sources as is the case with MBA schools, the question becomes more difficult to answer. In my opinion, the closer you are to professional instruction coupled with rigorous application the more value it has.

There are a handful of original consultants teaching Six Sigma from the early Motorola days. Would you rather have one of these consultants help you certify your organization, or someone who read 4 books on the subject and is knowledgeable of the topics? Ok, you caught me. I oversimplified the subject and there are always exceptions to the rule, but I think you understand my point with respect to the professional instruction. Now let's look at rigorous application: Would you feel more comfortable with a candidate that improved and controlled a process at GE or one that did the same at a $5 million dollar company? Probably the GE one, because you know that large companies have more rigor around their application and certification processes, and failures at a GE are not as easy to sweep under the carpet. Alright, before someone can jump over to the forum to post hate mail to me, there are exceptions to the rule and I can cite 5 instances that will fail my test also, but in my opinion the general rule holds. After all is said and done, Motorola and GE certifications are pedigrees and company XYZ is not as valuable. Don't blame me, blame the perceptions of the Quality community. I'm just the bearer of the news.

So, to sum up this question and answer...Can you certify people within your own business? Yes, of course you can. Is it worth much in your company? Probably, if you management team values it and rewards those who attain certification. Is it worth much outside your company? Maybe so, maybe not. It all depends how knowledgeable the person is and how the pedigree is perceived by the interviewing company

Bank Deposits: A Black Belt Case Study

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In early 2000, dot-coms were all the rage. Any idea even remotely related to the ability to transact online was immediately funded. Consequently, many decisions were made quickly and without supporting data. And many of these decisions were made in error -- but could Six Sigma have made a difference? This case study will review how a Black Belt entered a dot-com transactional business, reviewed a process, and came to his own conclusions about process performance.

Case Study: Online BankingThe Black Belt began working at online bank, and his first project involved the process of how deposits were made to this bank. Since it was an "online" bank, there were no branches for customers to use. Instead, deposits were mailed using the United States Postal Service (USPS). Savings resulting from the lack of branches and tellers were passed along to the customer in the form of higher rates, free services, etc.

Customer focus groups and surveys indicated that the process of making a deposit is of critical importance to a customer. The process from the customer's viewpoint is very straightforward -- they sign a check, fill out a deposit slip, and mail both to the bank. Deposits were the second largest driver of inquiries to the customer call center (13% of all calls). Customers expressed frustration in mailing delays and couldn't understand why their checks took so long to post to their account.

The Deposit ProcessThe bank's mission was to receive the deposits as quickly as possible and begin the deposit and check clearing cycle. When the bank originally set up the processes, a decision was made to establish 'local' deposit locations around the United States. These local deposit locations received the deposits and overnight express reshipped them to a central processing location daily.

This local receipt and express reshipment to a central location was done for two main reasons:

1. A deposit being mailed to a local location would take less time than mailing to a centralized, national location.

2. Customer input indicated that mailing within a state or to a neighboring state would make customers more comfortable than mailing to a centralized, national location somewhere across the United States.

The DMAIC ProjectThe Black Belt hit the ground running. A project charter was created identifying exactly what the process entailed. The business case was written, the problem statement crafted and the scope clearly identified. The team was formed and quickly moved into the measurement phase. Data surrounding the deposits was collected and the analyze phase began to yield some alarming results.

Bank Deposits: A Black Belt Case Study results

Intuition led the leaders of the business to set up a system that locally collected deposits for express reshipment to a centralized, national location for processing. How could mailing to a centralized, national location be quicker than mailing locally

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and express reshipping? Why wouldn't customers feel more comfortable mailing locally than to a centralized, national location?

Data and Root CausesData collection, however, revealed a few flaws that weren't originally identified:

The express reshipment process was manual. Manual processes that are not reinforced daily and that do not have adequate control plans tend to break down. That is exactly what occurred with the local deposit locations. Some locations wouldn't receive deposits on a daily basis. When deposits were received, they sometimes wouldn't be express reshipped that night because of a lack of engrained process.

For deposits that were received during the week, the express reshipment process functioned properly. On the weekend, however, express reshipment wasn't possible, so deposits arriving on Saturday were not express reshipped until Monday evening.

Because of USPS processes, some deposit mailings to 'local' deposit locations took as long as three days. Tack on a weekend stay for the above listed bullet, and you can see how a deposit made via mail to a 'local' deposit location may take longer than five days just to be received by the bank.

Additional FindingsAn additional analysis of deposits made to a 'local' deposit location with express reshipment to a national location versus mailing directly to a centralized, national location yielded the following results:

The 'local' process operates at a 2.1 sigma level, while the centralized, national process operates at a 2.5 sigma.

A 2 sample t-test indicated that there is a statistically significant difference between the two process means (p=0.0013).

The centralized, national process is faster (2.6 average days) than the local express reshipment process (4.6 average days).

An additional survey conducted with focus groups indicated that the deposit mailing location is not a significant factor for a majority of respondents. As an aside, the original data indicating that customers were more comfortable mailing deposits within their state could not be found.

A benchmarking analysis of direct competitors indicated that all utilized a centralized, national deposit process.

Project ConclusionsIt didn't take further data collection to convince the leaders of the business to modify their deposit process and move to a centralized, national process. The facts spoke for themselves. Cost savings resulting from only printing one address envelopes (instead of numerous local), reduced overhead associated with processing, fewer customer inquiry calls and investigations, and a more stable process resulted in savings of $4MM per year. Not bad for a six month Black Belt project.

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Six Sigma Questions and Answers Q&A

Learning the Six Sigma methodology can be confusing. Even if you know the Six Sigma methodology, questions arise from co-workers or in daily activities and answers may not be readily available. To help with this problem, iSixSigma has compiled a list of questions that have been posed on the discussion forum over the past months.

Below are the five basic questions: who, what, where, why and how. As new questions and answers are posted, we will append this list.

Six Sigma - What

What is the Six Sigma methodology? What are the costs and savings of Six Sigma? What curriculum / body of knowledge makes up Six Sigma? What is Six Sigma? (Elevator Speech) What makes Six Sigma work so well in a corporate environment? What is the statistical explanation of Six Sigma? What is a Six Sigma champion? What is the best Six Sigma book? What is the process sigma calculation formula? What does a Six Sigma organizational structure look like? What is the cost of poor quality? What is the cost savings of Six Sigma quality? What Six Sigma training is required in a business? What is the difference between the Six Sigma DMAIC and DMADV methodologies? What is the definition of DPMO or DPPM? What is the 1.5 sigma shift? What does a typical Black Belt project look like? What questions should I use to prepare for a Six Sigma tollgate review? What statistical software program should I use to analyze data? What Six Sigma project tracking software program should I use for my company? Six Sigma - Where

Six Sigma in Accounting Department Six Sigma in Accounts Receivable Six Sigma in Billing Department Six Sigma in Healthcare / Mental Health Six Sigma in Human Resources Six Sigma in Human Resources - Employee Turnover Six Sigma in Distribution Centers / Stock Rooms / Order Picking Six Sigma in Information Technology (IT) Six Sigma and Enterprise Resource Planning (ERP) Six Sigma in Insurance Industry Six Sigma in Inventory / Warehousing Six Sigma in Logistics / Traffic Applications Six Sigma in Logistics II Six Sigma in Retail Six Sigma in Sales Six Sigma in Sales & Marketing Six Sigma in Software Six Sigma in the Voting process

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Six Sigma in Order Forecasting Processes Six Sigma in India Six Sigma in a small business Where can I find Six Sigma software for a PDA? Where can I find a Six Sigma calculator? Six Sigma - Why

Why Six Sigma and ISO 9000 as a quality system? Why Six Sigma and not Deming as a quality system? Why Six Sigma and not Kaizen or Breakthrough? Why Six Sigma and not TQM? Why isn't Six Sigma just a fad? Why hire a Six Sigma consultant? Why link Six Sigma to financial results? Six Sigma - How

How can a novice learn Six Sigma on their own? How close is my process to Six Sigma? How do I explain Six Sigma in less than 30 seconds? How do I begin the Six Sigma implementation process? How do I calculate my process sigma level? How are Six Sigma projects reviewed? How do I calculate opportunities for Six Sigma? How do I define opportunities for Six Sigma? How do I convert Acceptable Quality Level (AQL) to sigma? How do I select a Six Sigma green belt project? How can a novice learn Six Sigma 'on the fly'? How Six Sigma and ISO9000 fit together? How can I help ensure successful technology implementations with Six Sigma? How do I calculate sample size? What is the status of Six Sigma in Japan? Six Sigma - Who

U.S. Companies Implementing Six Sigma U.S. Companies Implementing Six Sigma (Again) List of 115 Companies Implementing Six Sigma Six Sigma Companies In Asia Insurance Companies Using Six Sigma Companies In India Using Six Sigma Companies In Italy Using Six Sigma

Six Sigma Companies in Asia

American Standard

Alcan Packaging

Trane

Thai Airways International

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Seagate

Sony

Samsung

Toshiba

GE

Ideal Standard

Ford

Frabinet

Companies in India Having Six Sigma

GE, WIPRO, TATA STEEL, TELCO, ASIAN PAINTS, WHIRLPOOL, LG, L&T SWITCHGEAR, RELIANCE PATALGANGA, TVS SUZUKI, VIP INDUSTRIES, TATA HONEYWELL, TATA CONSULTANCY, PIDILITE INDUSTRIES ARE ALL DOING SIX SIGMA.

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