SIX SIGMA Σ

GROUP MEMBERS

UMER (22) TALIA NABI (23) DANISH BAZAZ (24) MUDASIR (25) TANZEEL SHAH (26)

PRESENTATION LAYOUTWhat is Six Sigma Why Six Sigma.Companies using six sigmaSix Sigma Methodology and ManagementBenefits of six sigmaFeatures of six sigmaSix Sigma applications.Conclusion.

SIX SIGMA Σ

Your first question is likely….

What is Six Sigma?

Your second question is likely…

Why Six Sigma?

WHAT IS SIX SIGMA ?

Six Sigma is a highly disciplined process that helps us focus on developing and delivering near-perfect products and services.

”Sigma“ The word is a statistical term that measures how far a given process deviates from perfection.

The central idea behind Six Sigma is if you can measure that how many “defects” you have in a process, you can systematically figure out how to eliminate them and get as close to “zero defects” as possible.

Six Sigma is a set of techniques and tools for process improvement. It was developed by Motorola in 1986.Jack Welch made it central to his business strategy at General Electric in 1995.

WHY SIX SIGMA?Six Sigma emerged as a natural evolution in business to increase profit by eliminating defectsThe Current business environment now demands and rewards innovation more than ever before due to:

Customer ExpectationsTechnological ChangeGlobal CompetitionMarket Fragmentation

COMPANIES USING 6ΣSix Sigma is in use in virtually all industries around the world. Some

of companies can be listed as: Motorola Ericsson General Electric Sony Ford Motor Co. CITI bank

UMER 22

SIX SIGMA METHODOLOGY(IT TAKES MONEY TO SAVE MONEY) BPMS

Business Process Management System

DMAIC Six Sigma Improvement Methodology

DMADV Creating new process which will perform at Six Sigma

BUSINESS PROCESS MANAGEMENT SYSTEM BPM

BPM strategies emphasize on process improvement and automation to derive performance

Combining BPM strategies with sigma six is most powerful way to improve performance

Both strategies are not mutually exclusive but some companies produced dramatic results by combining them.

WHAT IS DMAIC?

Define Measure Analyze Improve Control

A logical and structured approach to problem solving and process improvement.

An iterative process (continuous improvement)

A quality tool which focus on change management style.

DMADV... Acronym for: Define the project Measure the opportunity Analyze the process options Design the process Verify the performance

TANZEEL SHAH 26

PHASES OF SIX SIGMA Phases of Six Sigma are:

Define specific goals to achieve outcomes, consistent with customers demand and business strategy

Measure reduction of defects Analyze problems ,cause and effects must be considered Improve process on bases of measurements and analysis Control process to minimize defects

BENEFITS OF SIX SIGMA For the organisation

Generates sustained success.

Sets performance goal for everyone.

Enhances value for customers.

Accelerates rate of improvement (ROI).

Promotes learning across boundaries.

Executes strategic change.

Improved quality of product or service as perceived by the customer

(internal and external customers).

Development of staff skills.

Common language throughout the organisation.

Creates a competitive edge.

Drive sales growth.

CONTT.. For the individual

Improved knowledge and skills.

Ability to use a wide range of tools and techniques.

A status that is recognised world wide

MUDASIR 25

FEATURES OF SIX SIGMA

Six Sigma's aim is to eliminate waste and inefficiency, thereby increasing customer satisfaction by delivering what the customer is expecting.

Six Sigma follows a structured methodology, and has defined roles for the participants.

Six Sigma is about putting results on financial Statements.

CONTT.. Six Sigma is a business-driven, multi-dimensional structured approach for:

Improving Processes Lowering Defects Reducing process variability Reducing costs Increasing customer satisfaction Increased profits

The word Sigma is a statistical term that measures how far a given process deviates from perfection.

The central idea behind Six Sigma: If you can measure how many "defects" you have in a process, you can systematically figure out how to eliminate them and get as close to "zero defects" as possible and specifically it means a failure rate of 3.4 parts per million or 99.9997% perfect.

TALIA NABI (23)

APPLICATIONS OF SIX SIGMA

There are three components of Six Sigma that connects so well in basics of logistics.

The first component in Six Sigma is the financial savings and benefits which can be linked to the reduction of waste (packaging, transportation ,mechanisms, vehicles, etc).

The second component in Six Sigma is principle of variation reduction that measures and monitors the organisation and distribution processes in order to improve the outcome.

Finally, the third component refers to the strategic alignment that Six Sigma projects require to have significant impact in the business which is directly related to the key performance indicators or innovation procedures that takes place in the logistics company

RELATIONSHIP BETWEEN LOGISTICS AND SIX SIGMA

FINANCIAL SAVINGS – LOGISTIC WASTES.

Goldsby and Bullock suggest that through a lean approach of the Six Sigma methodology savings can be achieved, by critically focusing on the optimization of the product package due to the high cost that will eventually incur if a greater holding space than needed is utilised.

PRINCIPLE OF VARIATION REDUCTION – LOGISTICS PROCESS MEASUREMENTS

o Six Sigma is specifically concerned with variability reduction because when the variation is reduced, the chances of errors are reduced and there fore-creating financial benefits. 

o The organisation processes should be broken into sub-processes where each level of process should implement its own control metric. This provides the opportunity to re-examine and re-design the processes

PROJECT STRATEGIC ALIGNMENT – KEY PERFORMANCE INDICATORS / INNOVATION

According to Brewer if the companies take action by linking their performance measurement system to their supply chain practices, they will be better positioned to succeed in their supply chain initiatives.

Supply chain and logistics require cooperation, integration, partnership and information sharing; this integration requires anew kind of measurement indicators that show the performance of the chain not of single departments.

UPS CASE STUDYSix Sigma in United Parcel Services(UPS) Logistics service providers must become competitive in mail delivery,

customer relationship management (CRM) strategies and technological integration. UPS, for example, uses a logistics service strategy to effectively manage the logistical requirements for its 7.9 million daily customers. It is clear that Six Sigma provides foundations and applications to logistics service strategy in which UPS successfully integrated into its core activities and the global networks. United Parcel Services (UPS) is a valuable case to study because it demonstrates many issues facing service companies attempting to innovate. UPS is the world’s largest commercial and residential logistics company providing package delivery and is a growing provider of supply chain services around the world. Over the 1981-2002 period, revenues rose a compound annual growth rate of 9.2% and net income rose at a compounded annual growth rate of 10% Given this impressive track record, UPS finds itself today facing one of its largest challenges to date: figuring out a way to sustain the growth. 

 

CONCLUSION

Six Sigma has been at the forefront of the quality movement in recent years and gives the potential to refine current approaches to organisational improvement. In addition to elimination of waste, it also offers benefits by delivering reduced variations. As a result, good outcome of Six Sigma implementation will drive the increase in customer satisfaction, increase in revenue, reduction in cycle times and higher flexibility.

Thank you