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Six Sigma - A ContinuousImprovement Process

April 26, 2002

Authorized Panel BuilderForum 2002

Presenters: Sherry Hoy and Bertram Wells

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Six Sigma - A Continuous Improvement Process

Agenda:

• Principles of Six Sigma (6σ)

• Characteristics of a Six Sigmaapproach

• The tools of Six Sigma- the DMAICcycle

• Six Sigma Success Factors

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Six Sigma - A Continuous Improvement Process

• Principles of Six Sigma

– A strategy and a philosophy that promotes theuse of planned scientific approach forachieving customer satisfaction

– An efficient process that focuses on thestructured application of the tools andtechniques to improve customer satisfactionand achieve strategic business results.

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Six Sigma - A Continuous Improvement Process

Concept

Customer QualityRequirements (as definedby the customer)

Defect

Defect Opportunity

Sigma

Definition

Customer Performance Requirementof a Product or Service

Any Event That Does Not Meet TheSpecifications of the customer

Any Event Which Can Be Measured

That Provides a Chance of NotMeeting a Customer Requirement

A measure of variation in a process

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Six Sigma - A Continuous Improvement Process

If We Accepted The Goal of 99.9% Quality

Then we would have…

• One hour of unsafe drinking water every month

• Two unsafe plane landings per day at Paris (CDG & Orly)

• 20,000 pieces of mail lost in Europe every hour

• 500 incorrect surgical operations each week

• 50 newborn babies dropped at birth by doctors each day

• 22,000 checks deducted from the wrong bank accountseach hour

• 32,000 missed heartbeats per person, per yearWE EXPERIENCE SIX SIGMA PROCESSES EVERY DAY!

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Six Sigma - A Continuous Improvement Process

Characteristics of a Six Sigma approach

• Focuses on variability of processes, notonly on defects

• Founded on statistical Thinking

• Uses a common methodology to applyclassical and specific tools to meet thecustomer requirements known as theDMAIC cycle

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Defects Defects

Too early Too late

Delivery Time

Reduce

variation

Delivery Time

Too early Too late

Spread of variation toowide when compared tocustomer expectations.

Spread of variation narrowwhen compared to

customer expectations.

Importance of Reducing Variation

Six Sigma Focuses on Variability of Processes

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Off-Target

XX

XXXXX

XX

X

XX

SpreadX

X

X

X

XX

X

X

XXX

Center theProcess

Reduce theSpread

On-Target

X

XXXX

XX

XXXX

XX X

Six Sigma focuses on variability of processes

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Six Sigma Focuses on Variability of Processes

RESULTSRESULTSFailures,Failures,

shortages,shortages,rework,rework,scrap,scrap,

warrantywarrantycosts,costs,

excessiveexcessiveinventory,inventory,

extra spendextra spend

etcetc..

OutputOutputOutput

CUSTOMER EXPECTATIONSIncorrect job specs

Inadequate designs, marginsInadequate designs, marginsand tolerances not aligned toand tolerances not aligned to

material and processmaterial and process

MATERIALMATERIALunstable, out ofunstable, out ofspec., flawedspec., flawed

etc.etc.

PROCESSinconsistent,inconsistent,

incapable,incapable,over-complexover-complex

etc.etcetc.etc

What Causes Variability in the Output of a Process?

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Six Sigma Focuses on Variability of Processes

Statistical Thinking Basics

• All big-picture outcomes are generated through asystem of interconnected processes.

• All processes vary.

• All variation is caused.

Improvement comes through making the invisiblevariation visible and systematically eliminating the causes.

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The tools of Six Sigma- the DMAIC cycle

DEFINEDEFINE

MEASUREMEASURE

ANALYZEANALYZE

IMPROVEIMPROVE

CONTROLCONTROL

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The DMAIC cycle: Define

STEP

Define

OBJECTIVE

Develop clearbusiness case,projectsponsorship, multi-functional team,and identify thecritical process(es)

TOOLS

�Voice of CustomerAnalysis

�SIPOC (Supplier, Input,Process, Output, Customer)

�Flowchart

�Performance Objectives

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The DMAIC cycle : Measure

STEP

Measure

OBJECTIVE

Develop/executemeasurement plan tobaseline processperformance and setperformance goals

BASIC TOOLS

�Metrics: Cycle Time &Defect per MillionOpportunities

�Data Collection/Analysistools: Cycle Time forprocess steps,Checksheets, Histograms

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The DMAIC cycle: Analyze

STEP

Analyze

OBJECTIVE

Determine rootcauses that createthe performancegaps

BASIC TOOLS

�Pareto Chart

�Brainstorming

�Cause & EffectDiagrams

�Scatter Diagrams

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The DMAIC cycle: Improve

STEP

Improve/Innovate

OBJECTIVE

Identify, test, andselect the bestsolutions to improvethe process and closethe performancegaps

BASIC TOOLS

� Implementation Plan�Control Charts�Prioritization Matrix

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The DMAIC cycle: Control

STEP

Control

OBJECTIVE

Document,standardize, andcommunicate theimprovements tosustain the gains

TOOLS

�Training &CommunicationPlans

�Document &Process ControlPlans

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Why is Six Sigma different ? Success Factors

• Focuses on customer requirements

• Aligned to strategic business objectives

• Universal application across the business

• Projects selected are based on key business issueswith a direct link to increased profitability

• Pays for itself; returns are far greater thaninvestment

• Benefits are visible and traceable; focus is oncustomer satisfaction, decreasing of non-qualitycosts.

• Six Sigma is supported by top level management

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Six Sigma - Meeting Customer Requirements

LeadershipLeadership

ProcessProcess

CultureMotivationResponsibilityBehavior changes

Products/Services

People

Your Organization

To satisfy customer- better product quality- better market-in by listening to the customer ’svoice

Streamlining, fluidityDecreasing of varianceCustomer Satisfaction

OwnersManagersWorkers

Everyone must take aleadership role when servingthe customer

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Six Sigma - A Continuous Improvement Process

Case Study

Taylor’s TransportationTechnology Inc.

(TT&T) is one of the biggestspecialist suppliers of table toptransportation equipment. Thecompany offers a moderatevariety of equipment designed totransport small objects from pointA to point B. One of their mostpopular models, the Catapult, isspecially designed to transportping pong balls a distance of 6’.The Catapult contributes over60% of the company’s annual netincome.

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Six Sigma - A Continuous Improvement Process

Case Study

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Six Sigma - A Continuous Improvement Process

Case Study

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The success of Six Sigma in your organization isbased on the following criteria:

■ Individual and team participation■ Participation at all levels■ An established part of the culture

Six Sigma - Making A Difference