Title: Capturing the Voice of Customer: The Role of Quality Function Deployment, Lean Six Sigma, and Design for Six Sigma in Achieving Excellence through Baldridge Award
1 -
- Capturing the Voice of Customer The Role of
Quality Function Deployment, Lean Six Sigma, and
Design for Six Sigma in Achieving Excellence
through Baldridge Award
Amar Sahay, Ph.D.
www.realleansixsigmaquality.com
2Baldridge Quality Award an overview
- Award is given to organizations that have
demonstrated outstanding quality in their
products, services, and processes. - Categories
- manufacturing,
- service,
- small business,
- education and health care.
3Baldridge Quality Award Criteria
- Submit an application that details the approach,
deployment, and the results of quality activities
under the following seven major categories - Leadership,
- Strategic Planning,
- Customer Focus,
- Information and Analysis,
- Human Resource (workforce) Focus,
- Process Management (operations focus), and
Business results.
4Focus of this presentation
- This presentation focuses on one of the major
categories of the Baldridge Quality Award the
customer focus.
5 Presentation Customer Focus
Source 20112012 Baldridge Criteria for
Performance Excellence
6More than any other program, the
Baldridge Quality Award is responsible for making
quality a national priority and disseminating
best practices across the United States.
Report by Building on Baldridge American quality
for the 21st Century, by the private Council on
Competitiveness
7Meeting Customer Requirements
- We will show how the requirements in the
customer focus category of the Baldridge Award
criteria can be met by using the proven tools and
technologies - Six Sigma,
- Lean Sigma,
- Design for Six Sigma (DFSS), and
- the Quality Function Deployment (QFD)
8Addressing Customer Issues and Achieving
Excellence
- The proven tools in meeting and exceeding
customer expectations - Six Sigma
- Lean Six Sigma
- Design for Six Sigma (DFSS), and
- Quality Function Deployment (QFD)
These are customer-driven quality approach that
aim at meeting or exceeding customer
expectations.
9Addressing Customer Issues
- The success of companies depend on
- designing, developing and launching new
- products/service of superior quality,
- getting to the market quickly (reduced cycle
time), -
- bringing innovation in products,
- and most important of all,
- understanding the customers needs and
- requirements.
10How Six Sigma and Related Tools have helped
Companies?
- Six Sigma, Lean, Design for Six Sigma, and QFD
are major tools and technologies that have helped
companies achieve -
- excellence in designing and developing
- products and services,
- meeting and exceeding customer needs and
- requirements, and
- improving their revenues and profitability by
- increasing their market share.
11What is Six Sigma?(1 of 4)
Six Sigma can be described as a business
improvement approach that seeks to find and
eliminate causes of defects and errors in
manufacturing and service processes by focusing
on outputs that are critical to customers and
essential for a clear financial return for the
organization. Six Sigma was pioneered by
Motorola in the mid-1980s and popularized by the
success of General Electric.
12What is Six Sigma?(2 of 4)
- Six Sigma is a customer focused approach to
create near perfect processes, products, and
services all aligned to delivering what the
customer wants. - It is a project based approach where majority of
projects are selected for measurable bottom line
or customer impact majority of projects are
completed within two to six months. - Six sigma projects use well defined set of
statistical tools and process improvement
techniques by well trained people in an
organization.
13What is Six Sigma?(3 of 4)
- Six Sigma can be viewed as
- a set of powerful tools for improving products
and processes - an approach for improving both the process-and
people related aspects of business performance - Six Sigma has turned the companys focus from
inside to outside, changed the way we think and
train our future leaders and moved us toward
becoming truly customer-focused
organization.Annual Report 2000, GE
14Six Sigma(4 of 4)
- Six Sigma is a business strategy that employs
well-structured continuous improvement
methodology and statistical tools to reduce
defects and process variability. - Six Sigma has evolved from a focus on process
improvement using statistical tools to a
comprehensive framework for managing a business - Six Sigma has been employed in numerous companies
to reduce operating cost, eliminate waste,
increase reliability, incorporate innovation in
products and services, reduce cycle time, and
increase productivity.
15Six Sigma and Variation Reduction
- We quickly learned if we could control
variation, we could get all the parts and process
to work and get to an end result of 3.4 defects
per million opportunities, or a Six Sigma level.
Our people coined the term and it stuck. It was
shorthand for people to understand that if you
can control the variation, you can achieve
remarkable results. - --Interview with Robert W. Galvin, Chairman
Emeritus of Motorola, Inc.
16Objective of Six Sigma
- The objective of a Six Sigma program is to reduce
the variation in the process to the extent that
the likelihood of producing a defect is virtually
non-existent. This means improving quality, and
meeting or exceeding customers expectations. - The improved quality and reliability in products
and services leads to higher perceived value, and
increased market share thereby increasing
revenues and profitability.
17What does sigma mean?
- The term sigma (denoted by the Greek letter,s) is
a metric based on the statistical measure called
standard deviation and is a measure of
variability in a process. A metric is simply a
measurement of some quality characteristic for
example, percentage of defects. - The term six sigma statistically equates to 3.4
defects per million opportunities. Thus, a Six
Sigma process is capable of producing 3.4 defects
per million opportunities (DPMO).
18Improvement in Quality from 3 to 6 Sigma Levels
19Statistical Basis of Six Sigma
- In a Six Sigma process, a shift in the process
mean of 1.5-sigma on either side of the mean
results into 3.4 nonconforming products per
million.
20Metrics used in Industry
Source Enterprise Strategies, Technologies
Enable Six Sigma, Aberdeen Group, Sep. 2006
21Six Sigma in Industries
- Industry research and current trend shows that
Six Sigma and related methodologies are
considered as the most sought after emerging
technologies and programs by industries today. - A current industry survey of 600 companies shows
that approximately 41 are implementing Six
Sigma, and vast majorities of them (approximately
87) are implementing Lean Six Sigma and related
technologies World Class Manufacturing Report,
2006. The survey also shows that 72 of the
companies acknowledge that Six Sigma and related
technologies have increased their profitability
Quality Digest 36.
22Six Sigma Success
- A survey of 2577 quality professionals by Quality
Digest on Six Sigma - In the two years we have been tracking Six
Sigma usage and perceptions, the predominant
finding of survey responses is the overwhelming
agreement on this methodology as a means to
drastically reduce waste and improve
productivity. when properly implemented and
supported by management, the process yields huge
results. - Very few of those who utilize Six Sigma have
anything negative to say about it. - The down side reported was the difficulty of
implementing it within small companies.
23Quality Programs in Use
(Source The Lean Sigma Benchmark Report,
Aberdeen Group, September 2006)
24Relative Emphasis on Lean/Six Sigma
(Source The Lean Sigma Benchmark Report,
Aberdeen Group, September 2006)
25Factors Driving Quality and Six Sigma Program
(Source The Lean Sigma Benchmark
Report, Aberdeen Group, September 2006)
26Six Sigma Model
Six Sigma Methodology
Improved Business Performance
Improve Quality, Productivity, and
Perception Reduce Costs, Increase
Market Share, Increase Profitability Exceed
Customer Expectation
27Key Concepts of Six Sigma
- Think in terms of customer requirements, critical
to quality (CTQ) characteristics, key business
processes, costs of poor quality, and overall
strategic objectives. - Ensure that the identified metrics focus on
business results and are tied to customer
requirements, and CTQs. - Focus on corporate sponsors, project and process
owners, and internal and external customers. - Identify and prioritize business impact projects
according to expected savings and improved
throughput. - Help to overcome resistance to change obtain
the required resources.
28Six Sigma Applications
- Manufacturing reduce waste, improve product
consistency, reduce variation, improve quality,
solve equipment problems, create capacity,
improve productivity - Human resource reduce cycle time for hiring
processes, eliminate unneeded steps from the
process, improve productivity - Sales improve forecast reliability, pricing
strategies, pricing variation, market share - Anyone better understand customer needs and
requirements tailor service offerings to meet or
exceed customer expectations
29Second Generation of Six Sigma
- Six Sigma is part of the corporate business plan
that is key to achieving business objectives,
with top leadership support and involvement - Six Sigma must address the voice of the customer
(VOC)
30Definition of Quality
The quality of a product or service is the
customers perception of the degree to which the
product or service meets his or her expectations.
Six Sigma is a customer-driven quality approach
that aims at meeting or exceeding customer
expectations.
- Transcendent Quality is something that is
intuitively understood but - nearly impossible
to communicate, such as beauty or - love.
- Product-based Quality is found in the components
and attributes of a - product.
- User-based If the product or service meets or
exceeds customers - expectations, it has
good quality. - Manufacturing-based If the product conforms
to design -
specifications, it has good quality. - Value-based If the product is perceived as
providing good value for - the price, it has
good quality. -
31Defining Quality
Perfection
Consistency
Fast delivery
Providing a good, usable product
Eliminating waste Variation reduction
Doing it right the first time
Delighting or pleasing customers Meeting or
exceeding customer expectations
Total customer service and satisfaction
Compliance with policies and procedures
32Dimensions of Product Quality
- Based on the definitions of quality, Garvin
developed the following eight dimensions that
describe product quality - Performance
- Features
- Reliability
- Conformance to standards
- Durability
- Serviceability
- Aesthetics
- Perceived quality
- The recognition of these dimensions by management
and the selection of the dimensions along which
the business will compete is critical to business
success
33Dimensions of Product Quality
- Performance Will the product do the job?
- Features/Added features Does it have features
beyond the basic performance characteristics? - Reliability Is it reliable? Will it last a long
time? - Conformance Does the product conform to the
specifications? Is the product made exactly as
the design specified? - Serviceability Can it be fixed easily and cost
effectively? - Durability Can the product tolerate stress
without failure? - Aesthetics Does it have sensory characteristics
such as taste, feel, sound, look, and smell? - Perceived quality what is the customer opinion
about the product or service? How customers
perceive the quality of the product or service?
34Customer-Driven Quality
- Meeting and exceeding customer expectations
- Customers
- Consumers
- External customers
- Internal customers
35Principles of Quality
- Focus on customers
- Participation and teamwork
- Process focus supported by continuous improvement
36Customer Focus
- Customer is principal judge of quality
- Organizations must first understand customers
needs and expectations in order to meet and
exceed them - Organizations must build relationships with
customers
37Customer Focus in Six Sigma
To meet or exceed customer expectations,
organizations must fully understand all product
and service attributes that contribute to
customer value and lead to satisfaction and
loyalty called critical to quality (CTQ)
characteristics. CTQs represent the important
drivers of Six Sigma improvement efforts.
38Competitive Advantage
- Six Sigma driven by customer wants and needs
- Makes significant contribution to business
success - Matches organizations unique resources with
opportunities - Is durable and lasting
- Provides basis for further improvement
- Provides direction and motivation
Six Sigma efforts are focused on building strong
competitive advantage
39Six Sigma Quality and Profitability
Improved quality of design
Improved quality of conformance
Higher perceived value
Higher prices
Lower manufacturing and service costs
Increased market share
Increased revenues
Higher profitability
40Six Sigma and Business Results
Considerable evidence exists that Six Sigma
initiatives positively impact bottom-line results
from companies such as GE, Allied Signal, 3M,
Xerox, Raytheon, Citibank, and many others.
41Lean Six Sigma
- Lean is an approach that seeks to improve flow in
the value stream and eliminate waste. It is about
doing things quickly. - Six Sigma uses a powerful framework (DMAIC) and
simple to advanced statistical tools to uncover
root causes of the problem to understand and
reduce variation. It is about doing things right
(defect free)
42Lean and Six Sigma
- Lean is an approach based on the removal of
waste from service and manufacturing processes.
Many companies have reported significant
improvement through the removal of waste or
non-value added activities. - Six Sigma improves quality through defect
removal and process optimization. The improved
quality leads to higher perceived value and
increased market share thereby, increasing
revenue and achieving higher profitability. Many
companies have reported significant savings by
reducing the cost of poor quality.
43Difference Between Lean and Six Sigma (1 of 2)
Lean Six Sigma
Theory Reduce waste Reduce variation
Application guidelines Identify value Identify value stream Flow Pull Perfection Define Measure Analyze Improve Control
Focus Flow Problem
Assumptions Waste removal will improve performance Many small improvements are better than systems analysis A problem exists Figures and numbers are valued System output improves if variation in all process is reduced
44Difference Between Lean and Six Sigma (2 of 2)
Lean Six Sigma
Primary effect Reduced flow time Uniform process output
Secondary effects Less waste Fast throughput Less inventory Improved quality Less variation Uniform output Less inventory Improved efficiency Improved productivity Improved quality
Criticism Statistical analysis not valued System interaction not considered Process improved independently
Source Lean Six Sigma some basic concepts, NHS
Institute for Innovation and Improvement
45Integrating Lean and Six Sigma
- Companies have reported that bringing the two
concepts- Lean and Six Sigma together delivers
faster results. - While the objective of Lean is to create flow and
eliminate waste from the process, Six Sigma
improves process capability and reduces variation
thereby improving quality and reducing cost. If a
company just applies Six Sigma, it cannot
maximize the potential of the organization. Lean
is really an enabler for Six Sigma. - The Power of Six Sigma, Chowdhury, S., Prentice
Hall, London.
46Integrating Lean and Six Sigma
- More and more companies are realizing that it is
possible to achieve dramatic improvements in
cost, quality, and time by using the above
techniques. - Several companies including Toyota, General
Electric, Motorola, and many others have
accomplished impressive results using one or the
other technique. However, using only one of the
above techniques- Lean, Six Sigma, or Design for
Six Sigma has limitations.
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48 Design for Six Sigma (DFSS)
49Design for Six Sigma (DFSS) (1)
- DFSS is a systematic methodology to design new
products or processes so that quality is built
into every phase of product design. It is also
used for improving existing products through
redesign. - The roots of DFSS are in systems engineering. It
combines systems engineering methodology with
statistical methods to achieve built-in quality
objectives. - DFSS optimizes the critical to quality (CTQ)
characteristics to achieve the best system
performance. (CTQs are the selected few
measurable quality characteristics that are key
to a specific product, process, or service that
must be controlled to meet or exceed customer
expectation).
50Design for Six Sigma (DFSS) (2)
- The DFSS methodology has been identified by a
five-step process DMADV that stands for Define,
Measure, Analyze, Design, and Verify. These are
explained briefly. - Define determine the project need, identify the
project goals and objectives, determine
customers needs and requirements, and include
the voice of customers (VOC) - Measure determine the characteristics critical
to quality, prioritize customer needs and
requirements, and assess customers needs and CTQ
metrics - Analyze evaluate the process options to meet
customers need and CTQs - Design design product and process to meet the
customer requirements, include customer
requirements in the development process - Verify check the design to ensure that the
customers requirements are met
51Design for Six Sigma (DFSS) (3)
- Unlike Six Sigma process, DFSS is relatively new
and not standardized therefore, there are
inconsistencies in the methodology, tools, and
models companies employ.
52Design for Six Sigma (DFSS) (4)
- DFSS uses Robust Design (product is designed so
that small variations in production or assembly
do not adversely affect the product), Design of
Experiment (DOE), Design for Manufacturability,
Simulation and several other tools to optimize
product design. - DFSS balances the cost and quality.
- DFSS reduces the development cycle time in the
long run. - In DFSS, both engineering methods and statistics
are used to optimize the design requirements. - Like Six Sigma, the DFSS also uses a collection
of tools. These tools must be understood in
context to the engineering design for achieving
DFSS objectives.
53 DFSS Process
- The process of DFSS can be divided into four
categories described below. These are very
similar to the IDOV process described above.
- Concept Development and Concept Engineering (CE)
2. Design Development
3. Design Optimization
4. Design Verification
54DFSS Process
- Concept Development and Concept Engineering (CE)
- Concept development involves developing product
concepts and functionality based on the critical
to quality characteristics (CTQs), voice of
customer (VOC), technological capabilities, and
other economic considerations. - This stage is about bringing innovative ideas to
the product that do not currently exist. This is
done through listening to the voice of customers
that helps determine the critical quality
characteristics.
55DFSS Process
- Tools available to aid in the product design and
development process. - Quality Function Deployment and House of Quality
- Concurrent Engineering
- CAD/CAM
- Robust Design
- Detailed Design and Analysis (Tolerance Design,
Design for Manufacturability, Standardization and
Simplification) - Failure Mode and Effects Analysis (FMEA)
- Reliability Testing
56DFSS Process
- Quality Function Deployment (QFD) is an approach
used to meet the customers requirements in the
product design and development phase. -
- It helps to integrate the voice of customers and
critical quality characteristics in the design of
the products so that the products meet or exceed
customer expectations. - QFD helps eliminate the traditional and wasteful
design/redesign efforts by identifying and
incorporating customer requirements at the
earliest stage of design. Other benefits of QFD
include - closer interaction between marketing, design,
manufacturing, purchasing, and suppliers - reduced product development time,
- faster market entry, and
- customer focus.
- An example of QFD is shown on the next slide
57QFD Concept
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59Establishing Relationship between Customer
Requirements and Technical Descriptors
60(No Transcript)
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62Six Sigma or Design for Six Sigma?
- Unlike Six Sigma, the Design for Six Sigma (DFSS)
is not standardized and is not deployed well in
industry. - The goal of DFSS is to address and incorporate
quality issues early in the design/redesign
process using robust design methodologies. - Companies who have successfully employed Six
Sigma program have found that once they achieve
5-sigma quality levels (233 defects per million
opportunities), they must design or redesign
their products, processes and services by means
of DFSS to surpass this quality level. - The cost to correct the potential design problems
to reduce the defect level to achieve higher
quality level (above 4-sigma) is usually greater
than the projected cost savings of the further
improvement effort. It is therefore important
that the quality must be built in the design
phase, and the quality issues must be addressed
early in the design process. - To achieve Six Sigma quality level the companies
must determine where the Six Sigma activity
occurs in the life cycle of the product. In other
words, the companies must determine when to apply
the Design for Six Sigma or DFSS approach.
63Six Sigma, Lean or Design for Six Sigma?
- There is a need for an integrated approach to
achieve the overall objectives. - It is important for the companies to identify and
initiate appropriate projects based on Six Sigma,
Lean, or Design for Six Sigma depending on the
objectives and priorities. - Sometimes a combination of these methodologies is
needed as an integrated approach to achieve the
overall objectives of improving quality, reducing
defect and becoming a Six Sigma company, reducing
cost, eliminating waste, providing speed and
reliability of delivery, incorporating
flexibility and innovation in products and
services, and meeting or exceeding customers
expectation.
64Baldridge Customer Requirements
How do you listen to customers to obtain
actionable information? How do you listen to
potential customers, and customers of competitors
to obtain actionable information and to obtain
feedback on your products, customer support, and
transactions, as appropriate? How do your
measurements capture actionable information for
use in exceeding your customers expectations and
securing your customers engagement? How do you
determine customer dissatisfaction? How do your
measurements capture actionable information for
use in meeting your customers requirements and
exceeding their expectations in the future?
65Baldridge Customer Requirements
Listening to the voice of the customer might
include gathering and integrating various types
of customer data, such as survey data, focus
group findings, blog comments and other social
media data, warranty data, marketing and sales
information, and complaint data that affect
customers purchasing and engagement decisions -
all the above DFSS, QFD, Six Sigma) How do you
identify and innovate product offerings to meet
the requirements and exceed the expectations of
your customer groups and market segments
(identified in your Organizational Profile)? How
do you identify and innovate product offerings to
enter new markets, to attract new customers, and
to provide opportunities for expanding
relationships with existing customers, as
appropriate? (all the above DFSS, QFD, Six
Sigma) How do you consider customers of
competitors and other potential customers and
markets in this segmentation? (all the above
QFD)
66Baldridge Customer Requirements
Customer Data Use How do you use customer,
market, and product offering information to
improve marketing, build a more customer-focused
culture, and identify opportunities for
innovation? ((all the above QFD and DFSS) How
do you market, build, and manage relationships
with customers to achieve the following?
acquire customers and build market share, retain
customers, meet their requirements, and exceed
their expectations in each stage of the customer
life cycle increase their engagement with you
(all the above Six Sigma)
67Most of the criteria laid out in Baldridge
Customer Focus category can be met by Six Sigma
and related tools.Six Sigma, Lean, Design for
Six Sigma, and QFD are powerful tools in meeting
and exceeding customer requirements and achieving
excellence.