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Six Sigma: An Overview

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### Transcript of Six sigma an overview | Online Mini MBA (Free)

Six Sigma: An Overview

CONTENTS

A

•Why: Six Sigma

B

•What: Six Sigma

C

•How: Six Sigma

D

•6σ Project: Using DMAIC

FOUR

SECTIO

NS

Six Sigma: Why Factor

Why 6σ: An Example !!

• Customers want their pizza delivered fast!

• Guarantee = “30 minutes or less”

• What if we measured performance and found an average delivery time of 23.5 minutes?

– On-time performance is great, right?– Our customers must be happy with us, right?

Why 6σ: An Example !!

How often are we delivering on time?

How often are we delivering on time?

• Managing by the average doesn’t tell the whole story. The average and the variation together show what’s happening.

s

x

30 min. or less

0 10 20 30 40 50

Why 6σ: An Example !!

Reduce Variation to Improve Performance

How many standard deviations can you “fit” within customer expectations?

Reduce Variation to Improve Performance

How many standard deviations can you “fit” within customer expectations?

• Sigma level measures how often we meet (or fail to meet) the requirement(s) of our customer(s).

s

x

30 min. or less

0 10 20 30 40 50

Variation Customer: The Relation

• Variation means that a process does not produce the same result (the “Y”)

every time.

• Some variation will exist in all processes.

• Variation directly affects customer experiences.

Customers do not look at averages!

-10

-5

0

5

10

15

20

Six Sigma: Purpose

A scientific and practical method to achieve improvements in a company

Scientific:• Structured approach.• Assuming quantitative data.

customer.

“Show me the data”

”Show me the money”

Sigma Level

Defects Per Million Opportunities

Rate of Improvement

1 690,000

2 308,000 2 times

3 66,800 5 times

4 6,210 11 times

5 230 27 times

6 3.4 68 times

99.99966% Good (6 Sigma)

• 20,000 lost articles of mail per hour

• Unsafe drinking water for almost 15 minutes each day

• 5,000 incorrect surgical operations per week

• Two short or long landings at most major airports each day

• 200,000 wrong drug prescriptions each year

• No electricity for almost seven hours each month

• Seven articles lost per hour

• One unsafe minute every seven months

• 1.7 incorrect operations per week

• One short or long landing every five years

• 68 wrong prescriptions per year

• One hour without electricity every 34 years

99% Good (3.8 Sigma)

Six Sigma: Practical MeaningSix Sigma: Practical Meaning

Six Sigma: What Factor

• The term “Six Sigma” was coined by Bill Smith, an engineer with Motorola

• Late 1970s - Motorola started experimenting with problem solving through statistical analysis

• 1987 - Motorola officially launched it’s Six Sigma program

Origin of Six Sigma

Motorola the company that invented Six Sigma

Motorola the company that invented Six Sigma

What’s in a name ?

μ

σ

• Sigma is the Greek letter representing the standard deviation of a population of data.

• Sigma is a measureof variation

Six Sigma: Definition

Six Sigma – The 3 Distinct Elements

• A Measure:

– A Statistical definition of how far a process deviates from

perfection

• A Target:

– 3.4 defects per million opportunities

• A Philosophy:

– A long term business strategy focused on the reduction of

the cost through reduction of variability in product &

process

Six Sigma: Constrains

y

x

Poor Design

Changing Needs

Measurement System

Insufficient Process Capability

Skills & Behaviors

• Characterize

• Optimize

• Breakthrough

USL

T

LSL

USL

T

LSL

T

USLLSL

USL’LSL’

Six Sigma: FocusSix Sigma: Focus

Customer Focused - Both Internally & Externally

Six Sigma: Reality

• Six Sigma through the correct application of statistical tools can reap a company enormous rewards that will have a positive effect for years

Or

• Six Sigma can be a dismal failure if not used correctly

Six Sigma: Spotlight

• Accelerating fast breakthrough performance

• Significant financial results in 4-8 months

• Ensuring Six Sigma is an extension of the

Corporate culture, not the program of month

• Results first, then culture change!

Six Sigma: Reason for Success

• The Success at Motorola, GE and AlliedSignal has been attributed to:

– Strong leadership (Bob Galvin, Jack Welch and Larry Bossidy personally involved)

– Initial focus on operations – Aggressive project selection (potential savings in

cost of poor quality > \$50,000/year)– Training the right people

Six Sigma: Normal Distribution

+/ - 3 s

+/ - 6 s

LSL USL

ppm0.001

ppm1350

ppm1350

ppm0.001

Tolerance

Target = m

Six Sigma: Distribution With Correction

LSL

0 ppm ppm3.4

1.5s USL

ppm3.4ppm

66803

m

+/ - 6s

Tolerance

• Six-Sigma allows for un-foreseen ‘problems’ and longer term issues when calculating failure error or re-work rates

• Allows for a +/- 1.5 σ process ‘shift’

Six Sigma: How Factor

Six Sigma – 3 Dimension

ToolsOrganization

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 ControlVendorVendorProcess BProcess BProcess AProcess ACustomerCustomer VendorVendorProcess BProcess BProcess AProcess ACustomerCustomer

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: Focus Area

Process Management helps us maintain good results

as we perform our Mission.

Strategic planning helps us “focus” on key projects to reach our

Vision.

Process Improvement using the DMAIC process helps us fix work problems and

improve our Performance.

To be successful as an organization, we must learn how to effectively apply ALL three (3) areas.

Strategic Planning

Process Improvement

ProcessManagement

Six Sigma

Two components of Six SigmaTwo components of Six Sigma

1. Process Power

2. People Power

Six Sigma: Process

Design For Six Sigma (DFSS): DMADV

• 6 Sigma uses DMADV method for development of new products

• Define design goals that are consistent with customer demands and the enterprise strategy.

• Measure and identify CTQs

• Analyze to develop and design alternatives,

• Design details, optimize the design,

• Verify the design, set up pilot runs, implement the production process

What is DFSS?What is DFSS?

• Design For Six Sigma (DFSS)– A rigorous approach to the design of a new product or

service– The goals:

• Reduce delivery time and development cost and• Increase the effectiveness of the product or service and hence

customer satisfaction. – Key elements:

• A customer focus and the ability to measure quality using the six sigma metric and philosophy

• Appropriate design that delivers excitement without failure, and does so to budget and expectation

• An overarching business strategy and management that brings out the very best for organic growth, through the repeated and regular launch and successful development of new products and services

What is DFSS?What is DFSS?

DMAIC - SimplifiedDMAIC - Simplified

• Define– What is important?

• Measure– How are we doing?

• Analyze– What is wrong?

• Improve– Fix what’s wrong

• Control– Ensure gains are maintained to

guarantee performance

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

• An iterative process (continuous improvement)

• A quality tool with focus on change management

Six Sigma: DMAIC

Process Improvement utilizes a 5 step problem solving DMAIC process:

2) Measure

5) Control

4) Improve

1) Define

3) Analyze

Display Problem ...

WH

AT

WH

ER

E

WH

EN

WH

O

OU

TC

OM

E

Stratify Problem ...

1. Define 2. Measure

3. Analyze 4. Improve

Results Standardization Future Plans

Month

GOOD

Target

GAP

%

Histogram

n=63

21 Late

n=21

Pareto

B C A D

PROBLEM STATEMENT

Identify & Verify Root Cause ... Identify & Implement Countermeasures ...Countermeasures MatrixSingle Case Bore Contingency Table

FISHBONE

RE

AS

ON

/F

AC

TO

RA

B

C

1

CASE

2 3 4 5 APresent

AAbsent

EffectCauseProblem

No Problem

35 3

4 25

A

Scatter Diagram

Cause "C"

Eff

ect

B

EFFECT

PROBLEM STATEMENT

ROOT CAUSE

A

C

A1

A2

C1

C2

4 4 16 Y

5 4 20 Y

3 1 3 N

EF

F

FE

AS

OV

RL

AC

TN

?

3 2 6 NCM

BARRIERS AIDS

High A1a A1b

HOW WHO

1. Dev2. Impl

WHEN

CONTROL CHARTS

FLOW CHART

LESSONS LEARNED

WHAT'S NEXT?

GOOD

%

CM IMPL'M

Before After

n=21

n=10

O verallE ffect

B C A D C B A D

Target

Standard

Action Plan

5. Control4. Improve

Focus of Six Sigma

• Y• Dependent• Output• Effect• Symptom• Monitor

• X1 . . . Xn• Independent• Input-Process• Cause• Problem• Control

f(X)Y=

The focus of Six sigma is to identify and control Xs

Path to Six Sigma

Y

Xs

Measure

Analyze

Improve

Control

Pro

cess

Ch

arac

teri

zati

onP

roce

ss

Op

tim

izat

ion

Goal: Y = f ( x )

DefinePractical Problem

Statistical Problem

Statistical Solution

Practical Solution

The Approach to DMAICThe Approach to DMAIC

Practical Problem

StatisticalProblem

Statistical Solution

Practical Solution

MethodologyMethodology

DDefine

MMeasure

AAnalyze

IImprove

CControl

Identify and state the practical problem

Validate the practical problem by collecting data

Convert the practical problem to a statistical one, define statistical goal and identify potential statistical solution

Confirm and test the statistical solution

Convert the statistical solution to a practical solution

DefineDefine

VoC - Who wants the project and why ?

The scope of project / improvement

Key team members / resources for the project

Critical milestones and stakeholder review

Budget allocation

DDefine

MMeasure

AAnalyze

IImprove

CControl

MeasureMeasure

Ensure measurement system reliability

Prepare data collection plan

- Is tool used to measure the output variable flawed ?- Do all operators interpret the tool reading in the same way ?

- How many data points do you need to collect ?- How many days do you need to collect data for ?- What is the sampling strategy ?- Who will collect data and how will data get stored ? - What could the potential drivers of variation be ?

DDefine

MMeasure

AAnalyze

IImprove

CControl Collect data

AnalyzeAnalyze

Understand statistical problem

Baseline current process capability

Define statistical improvement goal

Identify drivers of variation (significant factors)

DDefine

MMeasure

AAnalyze

IImprove

CControl

Analyze – Identify Drivers of Variation

Root Cause Analysis (fish bone)

• A brainstorming tool that helps define and display major causes, sub causes and root causes that influence a process

• Visualize the potential relationship between causes which may be creating problems or defects

Problem

Backbone

Primary Cause Secondary

Cause

Root Cause

Analyze – Identify Drivers of Variation

Control – Impact Matrix

• A visual tool that helps in separating the vital few from the trivial many

Vital FewHigh Control – High

Impact

Cost IneffectiveLow Control – High Impact

Cost IneffectiveHigh Control – Low Impact

Trivial ManyLow Control – Low Impact

Control

Imp

act

Analyze – Identify Drivers of Variation

Pareto Chart

• Pareto principle states that disproportionately large percentage of defects are caused due to relatively fewer factors (generally, 80% defects are caused by 20% factors)

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

Analyze – Identify Drivers of Variation

Process Map Analysis

• Visually highlights hand off points / working relationships between people, processes and organizations

• Helps identify rework loops and non value add steps

VendorVendorProcess BProcess BProcess AProcess ACustomerCustomer VendorVendorProcess BProcess BProcess AProcess ACustomerCustomerVendorVendorProcess BProcess BProcess AProcess ACustomerCustomer VendorVendorProcess BProcess BProcess AProcess ACustomerCustomer

Improve

Map improved process

Pilot solution

Identify operating tolerance on significant factors

DDefine

MMeasure

AAnalyze

IImprove

CControl

Control

Ensure measurement system reliability for significant factors

Improved process capability

Sustenance Plan

- Is tool used to measure the input / process variables flawed ?

- Do all operators interpret the tool reading in the same way ?

- Statistical Process Control (SPC)

- Mistake Proofing

- Control Plan

DDefine

MMeasure

AAnalyze

IImprove

CControl

Two components of Six SigmaTwo components of Six Sigma

1. Process Power

2. People Power

Six Sigma: People Power

• High Level Executive committed to Six Sigma Success• Knowledgeable in Six Sigma Process• Assign key individuals to the Champion/Sponsor Position.

• High Level Executive • Provide resources for the job• Assist Black Belts to select projects• Benchmark with other organizations

• Resource for the Black Belts-experts • Experts on the Six Sigma process• Works with Champion to select projects

• Leaders of the Six Sigma process• Bring the project vision to reality• Solely dedicated to Six Sigma Program• Oversee Green Belts

• Project Leaders• Support the Black Belt to complete the project

Master Black Belt

Black Belt

Green Belt Green Belt Green Belt

Six Sigma: A Project

Six Sigma: A Project

Customer Satisfaction

Through

Claim Amount

DDefine

MMeasure

AAnalyze

IImprove

CControl

Original Project Not Used

(For Reference Purpose Only)

Six Sigma: A Project

DDefine

MMeasure

AAnalyze

IImprove

CControl

Strong Relationship (10)

Some Relationship (5)

Weak relationship (2)

No mark, no relationship (0)

Relative importance

S NO

1 10

2 10

3 8

4 5

5 10

70 150 200 70 150 150 150

3 2 1 3 2 2 2

RELATIONSHIPS

CUSTOMER NEEDS

Absolute

Relative

Driveability Issue

Safety Features Functioning

Part Availability Based On Order

Good Exterior Look

No Rust of Parts

< 100

Technical Importance

Target Value

Pain

t qua

lity

Part

spec

erro

r

Part

mis

s

Forw

ard

driv

ing

gear

Rev

erse

driv

ing

gear

ABS

Airb

ag

Quality Function Deployment (QFD) For Customer Problems

Six Sigma: A Project

S. N CUSTOMER PROBLEM CNTCLAIM AMT /

COUNTTOTAL

CLAIM AMT

1 ABS unit not working 10 \$ 300 \$ 3000

2 Reverse gear slippage at 30 kph 5 \$ 200 \$ 1000

3 Paint claims 10 \$ 100 \$ 1000

4 No air bag label (spec error) 50 \$ 10 \$ 500

5 Sun visor spec error 5 \$ 50 \$ 250

TOTAL \$ 5750

TOTAL CLAIM AMOUNT

1

2

3

4

5

Top – 5

Claim

Details

DDefine

MMeasure

AAnalyze

IImprove

CControl

Six Sigma: A Project

DDefine

MMeasure

AAnalyze

IImprove

CControl

Cause & Effect Diagram (Fish Borne Diagram)

All the Top-5 Problems

(as per QFD) have been

analyzed through Cause

& Effect Diagram (Fish

Borne Diagram).

Six Sigma: A Project

DDefine

MMeasure

AAnalyze

IImprove

CControl

Cause & Effect Diagram (Fish Borne Diagram)

Cause & Effect Diagram (Fish Borne Diagram)

Six Sigma: A Project

DDefine

MMeasure

AAnalyze

IImprove

CControl

Cause & Effect Diagram (Fish Borne Diagram)

Cause & Effect Diagram (Fish Borne Diagram)

Six Sigma: A Project

DDefine

MMeasure

AAnalyze

IImprove

CControl

• Changing machine procedure to incorporate ABS option in Roll &

Brake machine. (Refer Annexure – A)

• Incorporating Reverse gear checking method at Road Test. (Refer

Annexure – B)

• Creating work standard for all areas to avoid miss outs. (Refer

Annexure – C)

• Training procedure & skill requirement for all areas to identify skill

level of technicians. (Refer Annexure – D)

No Annexure Attached

(For Reference Only)

Six Sigma: A Project

DDefine

MMeasure

AAnalyze

IImprove

CControl

Refer Annexure – E

(Creating Mistake proofs / Updating Work standard for all areas to

avoid miss outs)

Based on the work standard, training given to all technicians who are

working in the designated area. Also in the control plan, multi-

inspection mentioned in some areas to avoid miss out.

No Annexure Attached

(For Reference Only)

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