Six Sigma for Managers
Contents :
• Six Sigma : An Overview
• What is Six Sigma?
• Why Six Sigma?
• Six Sigma Phases : Define, Measure, Analyze,
Improve and Control
• Tools and Key Roles for Six Sigma
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Why Six Sigma?
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What is Sigma ?
Sigma
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A term used in statistics to represent
standard deviation, an indicator of the
degree of variation in a set of a process
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What is Six Sigma?
Six
Sigma
A statistical concept that measures a
process in terms of defects – at the six
sigma level, there 3.4 defects per
million opportunities
A philosophy and a goal : as perfect as
practically possible
A methodology and a symbol of quality
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Sigma Level
Sigma Level
(Process
Capability)
Defects per Million
Opportunities
2
308,537
3
66,807
4
6,210
5
233
6
3.4
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Sigma Level
Six Sigma =
99,9997%
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Sigma Level
Why not Four
Sigma or
99.379% ?
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• Every hour the postal service
would lose 20,000 pieces of mail
• Every day our drinking water
would be unsafe for almost 15
minutes
• Every week there would be 5,000
surgical operations that go wrong
in some way
• Every month we would be without
electricity for almost seven hours
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Why Six Sigma?
Money
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Quality
Customer
Satisfaction
Competitive
Advantage
Growth
Employee Pride
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Why Six Sigma?
• At GE, Six Sigma added more than $ 2 billion to the
bottom line in 2000 alone
• Motorola saved more than $ 15 billion in the first 10
years of its Six Sigma effort
• AlliedSignal reports saving $ 1.5 billion through Six
Sigma.
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Why Six Sigma?
Six Sigma is about practices that help you
eliminate defects and always deliver
products and services that meet customer
specifications
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Cost of Poor Quality
What is cost of scrap?
What is cost of rework?
What is cost of excessive cycle times and
delays?
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Cost of Poor Quality
What is cost of business lost because
customers are dissatisfied with your
products or services?
What is cost of opportunities lost because
you didn’t have time or the resources to take
advantage of them?
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Critical-to-Quality (CTQ)
Elements of a process that significantly affect
the output of that process. Identifying these
elements is figuring out how to make
improvements that can dramatically reduce
costs and enhance quality.
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Six Sigma Phases
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Six Sigma Phases
Define
Measure Analyze
Improve
DMAIC
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Control
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Six Sigma Phases
Define
Define the project goals and customer
(internal and external) deliverables
Measure
Measure the process to determine current
performance
Analyze
Analyze and determine the root cause(s)
of the defects
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Six Sigma Phases
Improve the process by eliminating defects
Improve
Control
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Control future process performance
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Six Sigma Phases
• Define Customers and Requirements (CTQs)
Define
• Develop Problem Statement, Goals and
Benefits
• Identify Champion, Process Owner and Team
• Define Resources
• Evaluate Key Organizational Support
• Develop Project Plan and Milestones
• Develop High Level Process Map
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Six Sigma Phases
• Define Defect, Opportunity, Unit and Metrics
Measure
• Detailed Process Map of Appropriate Areas
• Develop Data Collection Plan
• Validate the Measurement System
• Collect the Data
• Begin Developing Y=f(x) Relationship
• Determine Process Capability and Sigma
Baseline
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Six Sigma Phases
• Define Performance Objectives
Analyze
• Identify Value/Non-Value Added Process
Steps
• Identify Sources of Variation
• Determine Root Cause(s)
• Determine Vital Few x's, Y=f(x)
Relationship
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Six Sigma Phases
• Perform Design of Experiments
Improve
• Develop Potential Solutions
• Define Operating Tolerances of Potential
System
• Assess Failure Modes of Potential
Solutions
• Validate Potential Improvement by Pilot
Studies
• Correct/Re-Evaluate Potential Solution
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Six Sigma Phases
Control
• Define and Validate Monitoring and Control
System
• Develop Standards and Procedures
• Implement Statistical Process Control
• Determine Process Capability
• Develop Transfer Plan, Handoff to Process Owner
• Verify Benefits, Cost Savings/Avoidance, Profit
Growth
• Close Project, Finalize Documentation
• Communicate to Business, Celebrate
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Define
Measure
Analyze
Improve
Control
Deliverables :
• Fully trained team is formed, supported, and
committed to work on improvement project.
• Team charter developed, customers identified and
high impact characteristics (CTQs) defined, business
process mapped.
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Define
Measure
Analyze
Improve
Control
Checkpoints for Readiness
Team Readiness :
•
Team is sponsored by a champion or business leader.
•
Team formed and team leaders assigned.
•
Improvement team members fully trained on Six Sigma and DMAIC.
Team Charter :
•
Completed project management charter, including business case,
problem and goal statements, project scope, milestones, roles and
responsibilities, communication plan.
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Define
Measure
Analyze
Improve
Control
Checkpoints for Readiness
Customers
•
Customer(s) identified and segmented according to their different
needs and requirements.
•
Data collected and displayed to better understand customer(s) critical
needs and requirements.
Business Process Mapping
•
Completed, verified, and validated high-level 'as is' (not 'should be' or
'could be') business process map.
•
Completed SIPOC representation, describing the Suppliers, Inputs,
Process, Outputs, and Customers.
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Define
Measure
Analyze
Improve
Control
Deliverables :
• Key measures identified, data collection planned and
executed, process variation displayed and communicated,
performance baselined, sigma level calculated.
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Define
Measure
Analyze
Improve
Control
Checkpoints for Readiness
Key Measures Identified
• Key measures identified and agreed upon.
• High impact defects defined and identified in the business process.
Data Collection Planned and Executed
• Solid data collection plan established that includes measurement
systems analysis.
• Data collected on key measures that were identified.
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Define
Measure
Analyze
Improve
Control
Checkpoints for Readiness
Process Variation Displayed/Communicated
• Process variation components displayed/communicated using
suitable charts, graphs, plots.
• Long term and short term variability accounted for.
Performance Baseline/Sigma Calculation
• Measure baseline process performance (capability, yield,
sigma level).
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Define
Measure
Analyze
Improve
Control
Deliverables :
• Data and process analysis, root cause analysis,
quantifying the gap/opportunity.
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Define
Measure
Analyze
Improve
Control
Checkpoints for Readiness
Data and Process Analysis
• Identify gaps between current performance and the goal
performance.
Root Cause Analysis
• Generate list of possible causes (sources of variation).
• Segment and stratify possible causes (sources of variation).
• Prioritize list of “vital few” causes (key sources of variation).
• Verify and quantify the root causes of variation.
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Define
Measure
Analyze
Improve
Control
Checkpoints for Readiness
Quantifying the Gap/Opportunity
• Determine the performance gap.
• Display and communicate the gap/opportunity in financial terms.
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Define
Measure
Analyze
Improve
Control
Deliverables :
• Generate (and test) possible solutions, select the best
solutions, design implementation plan.
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Define
Measure
Analyze
Improve
Control
Checkpoints for Readiness
Generating (and Testing) Possible Solutions
• Possible solutions generated and tested.
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Define
Measure
Analyze
Improve
Control
Checkpoints for Readiness
Selecting The Best Solution(s)
• Optimal solution selected based on testing and analysis.
• New and improved process ('should be') maps developed.
• Cost/benefit analysis of optimal solution(s).
• Small-scale pilot for proposed improvement(s).
• Pilot data collected and analyzed.
• Improved process ('should be') maps modified based on pilot data
and analysis.
• Project impact on utilizing the best solution(s).
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Define
Measure
Analyze
Improve
Control
Checkpoints for Readiness
Designing Implementation Plan
• Solution implementation plan established, including schedule/work
breakdown structure, resources, risk management plan,
cost/budget, and control plan.
• Contingency plan established.
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Define
Measure
Analyze
Improve
Control
Deliverables :
• Documented and implemented monitoring plan,
standardized process, documented procedures, response
plan established and deployed, transfer of ownership
(project closure).
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Define
Measure
Analyze
Improve
Control
Checkpoints for Readiness
Monitoring Plan
• Control plan in place for sustaining improvements (short and longterm).
Process Standardization
• New process steps, standards, and documentation are ingrained into
normal operations.
Documented Procedures
• Operating procedures are consistent.
• Knowledge gained on process is shared and institutionalized.
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Define
Measure
Analyze
Improve
Control
Checkpoints for Readiness
Response Plan
• Response plans established, understood, and deployed.
Transfer of Ownership (Project Closure)
• Transfer ownership and knowledge to process owner and process
team tasked with the responsibilities.
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Tools and Roles for
Six Sigma
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Tools for Six Sigma
• Creating flowcharts of the step in a
process – operations, decision points,
delays, movements, handoffs, rework,
loops, and controls or inspections.
• A process map is illustrated description of
how a process work.
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Process
Mapping
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Tools for Six Sigma
• DOE is a structured, organized method for
determining the relationship between
factors (Xs) affecting a process and the
output of that process (Y).
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Design of
Experiments
or DOE
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Tools for Six Sigma
• A group of rows and columns, with one set
of increments marked along the X
(horizontal) axis and another set of
increments marked along the Y (vertical)
axis.
• The purpose of using XY matrix is to study
and understand the relationship between
what you are putting into a process and
what your customer is getting out of it.
• The XY matrix allows the team to identify
gaps, areas for improvement.
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XY Matrix
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Tools for Six Sigma
• The goal of this tool is to ensure that your
measurement system is statically
confident – that it’s both accurate and
precise each and every time it is used.
• Undertaken during Measure phase, your
MSA determines whether or not you can
take a certain measurement and repeat or
reproduce it among different people who
take the same measurement.
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Measurement
System
Analysis
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Tools for Six Sigma
• Process capability tool is the measure of a
process being able to meet specification
requirements and fulfill customer CTQ
needs on a long term basis.
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Process
Capability
Tool
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Tools for Six Sigma
• Investigating a theory about the suspected
cause (s) of a particular effect in a process
to determine if it is correct.
• It’s a compass that points you directly to
the vital few factors that are most affecting
your process.
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Hypothesis
Testing
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Tools for Six Sigma
• The manner in which a part or process can
fail to meet a specification, creating a
defect or non-conformance, and the impact
on the customer if that failure mode is not
prevented or corrected.
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Failure
Mode Effect
Analysis
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Tools for Six Sigma
• A detailed assessment and guide for
maintaining all the positive changes you,
your black belt, and the project team have
made.
• It ensures that all your analysis and efforts
stay in effect and that you have information
at your disposal to prevent backsliding or a
return to less than optimal performance
standard.
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Control
Plan
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Key Roles for Six Sigma
Executive
Leadership
Includes CEO and other key top management
team members. They are responsible for setting
up a vision for Six Sigma implementation.
Champions
Are responsible for the Six Sigma
implementation across the organization in an
integrated manner. Champions also act as
mentor to Black Belts.
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Key Roles for Six Sigma
Master
Black Belts
Identified by champions, act as in-house expert
coach for the organization on Six Sigma. They
devote 100% of their time to Six Sigma.
Black Belts
Operate under Master Black Belts to apply Six
Sigma methodology to specific projects. They
primarily focus on Six Sigma project execution.
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Key Roles for Six Sigma
Green Belts
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Are the employees who take up Six Sigma
implementation along with their other job
responsibilities. They operate under the guidance
of Black Belts and support them in achieving the
overall results.
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Six Sigma Do’s
• Do communicate the commitment companywide
• Do demonstrate the commitment of company
leaders
• Do empower your key human resources
• Do provide on-site mentoring for black belts
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Six Sigma Do’s
• Do be patient at the inception of you six Sigma
initiative
• Do claim and advertise early “wins”
• Do benchmark
• Do establish project baseline and goals
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Recommended Further Readings:
1.
Greg Brue, Six Sigma for Managers, McGraw Hill
2.
George Eckes, Six Sigma for Everyone, John Wiley and Sons
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End of Material
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