How has the introduction of Six
Sigma improved service quality
by
John Jinkner
Project Scope
• My term paper studies the history of quality control in
an attempt to understand the factors that make Quality
Control Programs in a service setting either a success
or a failure
• Special emphasis is placed on the probability of a
successful Six Sigma implementation.
The question that this paper attempts to answer is…
"How has the introduction of Six Sigma
improved service quality."
Introduction
• All firms should be looking to
improve the quality of their product
or service.
• The Six Sigma objective uses a
comprehensive approach to
improve product quality and
consistency in an attempt to
increase the profits of the firm.
• Six Sigma is a quality control
program that has recently reached
fad status
History
Six Sigma
Quality Control
• Six Sigma began in the early
• Walter Shewhart of Western
1980’s as Motorola’s response to
Electric, in 1924, first applied
a manufacturing plant failure in
statistics in Quality Control.
the early 1970's.
• When a Japanese firm took over, • Deming is most widely known
for introducing Total Quality
they were able to produce the
Control in Japan in 1950.
same product without changing
equipment or people.
• Motorola’s realized that their
Quality Control program was
ineffective
• Total Quality Management
became popular in the U.S. in
the 1980’s as a response to
Japanese competition
History
• Walter Shewhart became known
as the Father of Statistical
Control
Shewhart
Deming
• Edwards Deming became
known as the father of the Total
Quality Management movement
How does Six Sigma Work
Six Sigma uses a top down approach to quality control.
Top management
• Establishes a Leadership Team.
• Identifies key business issues.
• Assigns resources.
• Set aggressive goals.
• Incorporates the reward system.
• Direct finance & validate ROI.
• Finds intellectual capital
• Evaluate Six Sigma process and
make changes if necessary.
Training
•
Executive Sponsor Training
– Senior leadership learn principles, tools, and techniques needed to become Six
Sigma.
– Leaders apply Six Sigma through hands-on experience, mapping processes.
•
Black Belt Training
– Training includes principles, problem-solving tools, project planning and
management, exploratory data analysis tools, quality control and quality
management tools, process mapping and simulation, and advanced statistical
analysis.
•
Green Belt Training
– Training is a one week course covering meeting facilitation, project management,
quality management and control tools, problem solving, and exploratory data
analysis.
TQM PROJECT STRATEGY (Applied to 6 DMAIC)
Define
1) Gather and Interpret
Data
Types of Variables

Examples of

Variables
Check Sheets

Incident Charts

Sun Diagram

Customer

Questionnaires,
Surveys and
Interviews
Focus Groups

Measure
(3) Process documentation and
Analysis
1. Flow Charts
2. Work-Flow Diagrams
3. Activity Diagrams
4. S.I.P.O.C, Suppliers-InputsProcess-Outputs-Customers
5. Detailed Process Analysis
6. Tree Diagrams
Analyze
(5) Make Sense of Data,
Change Data to
Information
 Affinity Diagrams
 Cluster Verbal Data
 Relational Digraphs
 Stratify Data
 Matrix Diagrams
 Synthesis Matrix
(4)
1.



2.
3.
4.
(6) Project Selection,
Prioritization and
Development

Failure Mode and Effect
Analysis

Prioritizing Hazard
Reduction

Cost of Non-Quality

Analysis Project

Selection

Judging Each Project

Cost/Benefit Analysis
The “DMAIC” approach
Data Analysis and Presentation
Pareto Charts/Analysis
80/20
Vital/Few/Trivial/Many
ABC Analysis
Run Charts
Scatter Diagrams
Useful Statistical Thoughts
Define - The problem is defined and the metrics used
2) Gather, Interpret and
Present
1. Control Charts
2. X&MR Charts
3. Individual Sample
Chart
4. Attribute Control
Chart
5. Special Causes
6. Single Sample Lots
Improve
7) Improvement Strategies
Four "Res" Repair, Refine, Refurbish and
Reinvent
to measure success is established as a base line
Measure - Current process data is gathered and
measured against customer requirements (defects) to ensure
the measurement is quantifiable and accurate Control
(11) Dig Out Root Causes

Separate Special and Common Causes

Control and Run Charts, Five "Whys"

Cause and Effect Diagrams (Ishikawa,
Fishbone)

Reporter's Six, Five W's and an H
Analyze - Data is analyzed to validate the base line,
8) Team Optimization
Stages of Team Growth
Ground Rules/Code of Conduct
Meetings, Agendas, and Reports
identify root causes of defects, and measure the impact on
the process
(12) Optimize Decisions
9) Generate Soft Data and New Ideas
Silent Brainstorming
Reverse Brainstorming
Fishbone/Improvement Cause and Effect
Random Stimulation
Indirect Analogy
Choice of Entry Point or Shift In Attention Area




Decision Matrix
Multi-voting Approaches
Force Field Analysis
Return on Improvement Investment
Improve - The process is changed to reduce
variability and defect levels - design
experiment
(13) Test of
Root
Causes and Solutions



Test Identified "Root Causes"
Test of Optimum Solutions
Improvement Strategies and Tactics
Control - Includes monitoring critical metrics though
10) Problem-Solving and Process Improvement
Systematic Approach
Problem-Solving and Process Improvement
Eight Step Process for Teams
Sign-off Process for Teams
Eight-Step Problem-Solving Approach for
Individuals
(14) Learning and Improvement

the use of attribute, variable, run
charts,
other
Plan, Do,or
Study,
Actautomated
(PDSA)

Shewhart Cycle,
measurement tools

Deming Cycle
Quality Tools
Control Charts
1920's
Cause & effect diagram
1943
F
l
o
w
C
h
a
r
t
s
Multiple
regression
Unknown
1893-1912
Quality Tools
Today’s
statisticians
have powerful
new tools
Awareness of the problem
What makes a company aware of
the need for quality control?
Today…
• In the 1980’s…
• Increased customer
Quality control
service expectations
initiatives were in
response to competition • Developing technologies
from Japanese
• National and...
manufacturing firms
• International
competition
Impact of quality on the Organization
Why choose Six Sigma as your quality control program
(what the experts say)
Six Sigma will save the firm $300,000 to
400,000 per project
• Strategic advantages include:
–
–
–
–
–
–
Identifying customer needs
Increasing compliance of standards
Striving for zero defects
Reducing outcome variability
Identifying and monitoring processes
Continually working for improved quality
Consequences of no Change
• Competitive conditions in
are in a state of continuous
change:
–
–
–
–
Technology
Demographics
Societal priorities
The economic environment.
It’s us or them
• Innovation can transform
companies allowing them to
cope with the increasing
complexity of their environment.
• Survival depends on:
– Cutting response time
– Training multi-skilled
employees
– Redesigning work processes
– Cutting waste and reducing
cycle time
TQM - Success or Failure?
Successful in some manufacturing but
difficult to start in service industries
• McDonnell Douglas - TQM was highly successful in
turning the company around.
• Hospitals - Doctors have thwarted nearly all quality control
initiatives
• Even College Professors - may become apathetic when
unnecessary or inconsistent quality controls measures are
unproductive and lacking in substance and meaning.
Six Sigma - So far?
• Motorola - 1987-1994
– Reduced defect levels by 200.%
– Reduced manufacturing costs by
$1.4 billion
– Increased production 126%
– Increased stockholder value by
400%
• AlliedSignal - 19921996
• General Electric 1995-1998
– Company wide savings of over $1
Billion.
– Annual savings $6.6 Billion by year
2000.
• Polaroid -1995-1998
– $1.4 Billion cost reduction
– Saved over $10 Million in first year
– 14% growth per quarter
– Reduced inspection costs by
$200,000
– 520% price/share growth
– Reduced new product time by 16%
– 24% bill/cycle reduction
– Plans to reduce inception
to market time by 50%
Schools of Thought
• Six Sigma as a
Statistical Tool
•
•
•
•
Research has found improper
application of techniques, producing
inadequate results.
Improper application of techniques
occurs because of lack of specific
statistical knowledge & skill
Poor understanding is due to the
generalized training given by
consulting firms
Consulting firms give generalized
training because they are unfamiliar
with the organizations processes.
• Six Sigma
Management
•
•
•
•
Six Sigma, like all TQM, requires
management direction, motivation,
and a sense of structure
Low employee acceptance rates
threaten program’s existence
Low morale & enthusiasm occur
because of poor supervision,
management style, and insufficient
interdepartmental communication
Six Sigma encourages leaders to
communicate progress frequently
and to provide
a sense of
purpose
Information Technology
Heavy reliance on new information
technology systems is not necessary
Six Sigma authors recommend putting
technology upgrade plans on hold until a
Six Sigma program is fully implemented.
Six Sigma does require manipulation
of statistical data. A quality information
system can play a decisive role in the
success of the program.
Conclusion
"How has the introduction of Six Sigma
improved service quality."
Answer: Six Sigma is merely another
quality control tool
• Six Sigma is another in a long list of quality control
tools that can help firms develop a commitment to total
quality control
• More important than information technology is
management commitment and a burning desire to win
• Firms not committed to quality improvement will
continue to flounder
Proof
•
In the 1950’s, Japanese factories were in shambles and through the Deming
theory of quality control they found a way to compete with the world.
•
In the early 1980’s American industry’s wake up call was the phrase “Made In
Japan,” which became synonymous with high quality, survival reaction
•
Today’s environment finds firms slashing it out for market share. Only those
firms with top management commitment to a quality program are succeeding.
•
Throughout my research I found that management’s failure to commit to a
quality program was the major reason for failure. When management is
unable to rally the troops and demonstrate an urgent need for quality
improvement, quality programs just fade away
Managerial Implications
Passion
Passion and not the latest technology will get the
firm where it needs to be.
Firms that assume the “consultants” can train
away their quality control problems are mistaken.
The latest technology is a requirement, but only
as a secondary consideration for a quality
control program.
Personal Objectives
My personal objective was to learn more about the
quality control movement and Six Sigma since I
will be working in the Six Sigma initiative.
– Determine how Six Sigma has improved Service Quality
– Determine technology’s role quality programs
– Understand how Six Sigma may be implemented in my firm
Thank you
Any questions?