Understanding Six Sigma

Presented to: Sir Prof. Ashfaq AhmedPresented By: Omar Aijaz

Road Map to Six Sigma Understanding

Understanding Six Sigma

Definition

History

Methods & Strategy

Problem Solving

Roles & Responsibility

By Definition

• Six Sigma is a business management strategy, originally developed by Motorola in 1986. Six Sigma became well known after Jack Welch made it a central focus of his business strategy at General Electric in 1995, and today it is widely used in many sectors of industry.

• Six Sigma seeks to improve the quality of process outputs by identifying and removing the causes of defects (errors) and minimizing variability in manufacturing and business processes.

• It uses a set of quality management methods, including statistical methods, and creates a special infrastructure of people within the organization ("Black Belts", "Green Belts", etc.) who are experts in these methods. Each Six Sigma project carried out within an organization follows a defined sequence of steps and has quantified financial targets (cost reduction and/or profit increase)

History of Six Sigma• 1984 Bob Galvin of Motorola showed the first objectives of Six Sigma

– 10x levels of improvement in service and quality by 1989– 100x improvement by 1991– Six sigma capability by 1992– Bill Smith, an engineer from Motorola, is the person credited as the

father of Six Sigma• 1984 Texas Instruments and ABB work closely with Motorola to further

develop Six Sigma.• 1994 Application experts leave Motorola.• 1995 AlliedSignal begins Six Sigma initiative as directed by Larry Bossidy

– Captured the interest of Wall Street • 1995 General Electric, led by Jack Weish, begun the most widespread

undertaking of six sigma ever attempted.• 1997 to present six sigma spans industries worldwide

• Simplistically, Six Sigma was a program that was generated around targeting a process Mean (average) six Standard Deviations away from the closest specification limit.

• Six sigma created a realistic and quantifiable goal in terms of its target of 3.4 defects per million opportunities. It is also accompanied by the methodology to attain this goal.

• The methodology was a problem solving strategy made up of four steps: measure, analyze, improve and control.

• When GE launched six sigma they improved the methodology by including the Define Phase.

History of Six Sigma

DEFINE MEASURE ANALYZE IMPROVE CONTROL

GENERAL ELECTRIC MOTOROLA

Sigma Level Example

Sigma level DPMO Percent defective Percentage yield Short-term

Cpk

Long-term Cpk

1 691,462 69% 31% 0.33 –0.17

2 308,538 31% 69% 0.67 0.17

3 66,807 6.7% 93.3% 1.00 0.5

4 6,210 0.62% 99.38% 1.33 0.83

5 233 0.023% 99.977% 1.67 1.17

6 3.4 0.00034% 99.99966% 2.00 1.5

7 0.019 0.0000019% 99.9999981% 2.33 1.83

Features That Set Six Sigma Apart From Previous Quality Improvement Initiatives Include

• A clear focus on achieving measurable and quantifiable financial returns from any Six Sigma project.

• An increased emphasis on strong and passionate management leadership and support.

• A special infrastructure of "Champions", "Master Black Belts", "Black Belts", "Green Belts", "Red Belts" etc. to lead and implement the Six Sigma approach.

• A clear commitment to making decisions on the basis of verifiable data, rather than assumptions and guesswork.

Methods For Six Sigma

• Six Sigma projects follow two project methodologies inspired by Deming's Plan-Do-Check-Act Cycle. These methodologies, composed of five phases each, bear the acronyms DMAIC and DMADV.

• DMAIC is used for projects aimed at improving an existing business process. DMAIC is pronounced as "duh-may-ick".

• DMADV is used for projects aimed at creating new product or process designs. DMADV is pronounced as "duh-mad-vee".

DMAIC• The DMAIC project methodology has five phases:• Define the problem, the voice of the customer, and the project goals,

specifically.• Measure key aspects of the current process and collect relevant data.• Analyze the data to investigate and verify cause-and-effect

relationships. Determine what the relationships are, and attempt to ensure that all factors have been considered. Seek out root cause of the defect under investigation.

• Improve or optimize the current process based upon data analysis using techniques such as design of experiments, poka yoke or mistake proofing, and standard work to create a new, future state process. Set up pilot runs to establish process capability.

• Control the future state process to ensure that any deviations from target are corrected before they result in defects. Implement control systems such as statistical process control, production boards, visual workplaces, and continuously monitor the process.

DMADV or DFSS• The DMADV project methodology, also known

as DFSS ("Design For Six Sigma"), features five phases:• Define design goals that are consistent with customer

demands and the enterprise strategy.• Measure and identify CTQs (characteristics that

are Critical To Quality), product capabilities, production process capability, and risks.

• Analyze to develop and design alternatives, create a high-level design and evaluate design capability to select the best design.

• Design details, optimize the design, and plan for design verification. This phase may require simulations.

• Verify the design, set up pilot runs, implement the production process and hand it over to the process owner(s).

Strategies to Six Sigma

Six Sigma Strategy

Six Sigma places the emphasis on the process– Using a structured, data driven approach centered on

the customer, Six sigma can resolve business problems where are rooted, for example;• Month end reports• Capital expenditure approval• New hire recruitments

Six sigma is a Breakthrough Strategy – Widened the scope of the definition of quality

• Includes the value and the utility of the product/services to both the company and the customer.

Conventional Strategy

Conventional definition of quality focused on conformance to standards.

Conventional strategy was to create a product or service that met certain specifications.– Assumed that if products and services were of good

quality, then their performance standards were correct.– Rework was required to ensure final quality– Efforts were overlooked and un-quantified (time,

money, equipment usage, etc.)

Problem Solving Strategy

• Understanding the relationship between independent variables and the dependent variable.

• Identifying the vital few independent variables that effect the dependent variable.

• Optimizing the independent variables so as to control our dependant variable(s).

• Monitoring the optimized independent variables.There are many examples to describe dependent and

independent relationships.• We describe the concept in terms of the equation.

Y = f (Xi)This simply states that Y is the function of X’s. In other words Y is dictated by the

X’s.

Example

Y = f (Xi)

Which process variables (Causes i.e. X) have critical impact on the output (Effect i.e. Y)?

Example of “Closing of a grocery store”:Time to Close = f (Trial Balance, Correct Accounts Applied, Sub Accounts, Credit

Memos, Entry Mistakes, Xn )

If we are so good at the X’s then why do we constantly test and inspect the Y ?

Six Sigma Strategy

We use a variety of six sigma tools to help us separate the “vital few” variables effecting our Y from the “trivial many”.

Some processes contain many variables. However our Y is not effected by all of them. By focusing on vital few we instantly gain leverage.

Few Example: • Define, Measure, Analyze, Improve, Control Problem solving

methodology• Pareto Chart• Cause & Effect Diagram• Failure Mode Effect Analysis (FMEA)• 5 Whys

Sigma Normal Distribution

Six Sigma Roles & ResponsibilitiesThere are many roles and responsibilities for

successful implementation of Six Sigma.• Executive Leadership• Champion / Process

Owner• Master Black Belt• Black Belts• Green Belts• Yellow Belts

MBB

BLACK BELTS

GREEN BELTS

YELLOW BELTS

Eventually there should be a big base of support internal to the organization

Where to do Six Sigma From?

piqc.edu.pk

Pakistan Institute Quality Control

www.isl.co.in

polarisproject.org

Thanks!!