Six Sigma

1
Six Sigma

• Overview

2
Considerations

• How are customers currently satisfied? Are they?
• Is competition increasingly difficult?
• Have previous initiatives been perceived as
  flavor of the month?
• What makes Six Sigma so effective?

3
Module Objectives

• Six Sigma OBJECTIVE
• Definition
• History of Six Sigma
• Data collection and decision making
• Benefits and results
• Roles (Sponsor, Black Belt, Green Belt)
• Six Sigma FOCUS
• Y f(x)
• Six Sigma DEPLOYMENT

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Thinking
Managing the Business
Performing Jobs Better
Meeting Strategic Objectives
Learning about Processes
Identifying Eliminating Variation
Preventing Defects
Measurement
Goal
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What Is Six Sigma?
Six Sigma is a variation reduction process used
by cross-functional project teams to reduce
costs, improve customer satisfaction, and create
revenue growth.
Six Sigma will DRAMATICALLY improve the BOTTOM
LINE!
6
Six Sigma Is Not

• Just another training program.
• Its about obtaining tangible results!
• A replacement for current quality management
  systems.
• The cure-all.
• Only applicable for manufacturing.

7
History of Six Sigma

• Originated in the early 1980s at Motorola.
• TQM was not achieving the desired results.
• Focused on reducing product and process
  variability in order to prevent defects.
• Used to achieve the goal of doing it right the
  first time.
• Established and communicated the process they
  termed Six Sigma.

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Six Sigma Can Apply Everywhere

• Administrative
• Transactional
• Design
• Purchasing
• Manufacturing
• Maintenance
• Customer Service
• Quality Assurance

Process Improvements Lead to a Positive
Bottom-Line Impact!
Six Sigma focuses on Customer Satisfaction
through PROCESS IMPROVEMENT!
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A goal of Six Sigma is to achieve customer
satisfaction. The KEY to customer satisfaction
is
Focus On Customer Satisfaction
INFORMATION BASED ON DATA!
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Data/Knowledge Is Power!

• We dont know what we dont know.
• If we cant express what we know in the form of
  numbers, we really dont know much about it.
• If we dont know much about it, we cant control
  it.
• If we cant control it, we are at the mercy of
  chance!

Lord Kelvin
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Why Collect Data?

• Communicate objectively.
• Create a common language across the company.
• Collect quantifiable facts about a problem or
  opportunity.
• Establish baseline information.
• Facilitate cost benefit analysis of proposed
  solutions.
• Measure the amount of change (and direction).
• Compare the before and after pictures of a
  process.
• Justify changes for improvements.
• Quantify the impact of a solution.
• GAIN PROCESS KNOWLEDGE!

Remember, the Plural of Opinion is NOT Data!
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Do We Measure the Right Things?
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Choose the Right Metrics
Manufacturing Processes
Business Processes

• Variation
• Rolled throughput yield
• Scrap rework
• Cycle time
• Lead time
• Warranty costs
• Supplier quality
• Overtime
• Expedited freight
• Inventory

• Variation
• Expedites/month
• Errors/month
• Items processed/month
• Warranty incidences
• Phone calls/day/person
• Number of orders/month
• Air freight
• Overtime
• Inventory

Identify and improve performance metrics that
relate to BUSINESS SUCCESS.
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Decision Making Process
Complex Problems Solved
This is where we would like to be!
Simple Problems Solved
Make charts/graphs of raw data
Use Six Sigma thinking to improve the process
Look at raw data
Gut feel
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How Is Six Sigma Different?
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Differentiating Characteristics

• Strong emphasis upon understanding customer
  requirements.
• Focused problem-solving projects aligned with
  business goals.
• Packaging of the tools.
• Disciplined rigor of data-based decision making.
• Intense financial focus and visibility of
  bottom-line business results.

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Quality Versus Six Sigma

• A functional specialty within the organization.
• Focuses on quality.
• Is done because quality is good.
• Loosely monitors progress toward goals.
• Emphasizes problem solving.

• An infrastructure of dedicated change agents.
• Focuses on strategic goals and applies them to
  cost, schedule and other key business metrics.
• Is done because it creates a tangible benefit for
  a major stakeholder group (customers,
  shareholders, or employees.)
• Ensures that the investment produces the expected
  return.
• Emphasizes breakthrough rates of improvement.

Source Six Sigma Qualitys Evolution? The
differences between Six Sigma and TQM Quality
Digest, 9/01
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Quality Versus Six Sigma

• Quality is a permanent, full-time job Career
  path is in the quality profession.
• Provides a vast set of tools and techniques with
  no clear framework for using them effectively.
• Expected payoff is not well defined

• Six Sigma job can be temporary. Six Sigma is a
  stepping-stone Career path can lead anywhere.
• Provides a selected subset of tools and
  techniques and a clearly defined framework for
  using them to achieve results (Define-Measure-Anal
  yze-Improve-Control.)
• Six Sigma looks for a mix of short-term and
  long-term results, as dictated by business
  demands The expected business results are
  clearly identified.

Source Six Sigma Qualitys Evolution? The
differences between Six Sigma and TQM Quality
Digest, 9/01
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Benefits of Six Sigma

• Gain process knowledge to make improvements.
• Improve processes in a more efficient manner and
  make them last.
• Save money.
• Dramatically improve the bottom line.
• Reduce the Cost of Poor Quality

Satisfy Customers!
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Source What You Need to Know About Six Sigma
Quality, Automotive Manufacturing, 11/01.
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Reduced Cost of Poor Quality

• Internal Costs of Poor Quality
• Scrap
• Rework
• Overtime
• Troubleshooting
• Inspection costs
• Rejected raw materials
• Supplier caused losses
• Unplanned production downtime
• Engineering and product development errors
• Engineering change notices
• Bill of material errors

• External Costs of Poor Quality
• Warranty expense
• Customer claims
• Lost sales
• Customer dissatisfaction or reputation loss
• Wrong or untimely responses to customer inquiries
• Administrative/customer service errors
• Maintaining customer field service

• Appraisal Costs of Poor Quality
• Incoming Inspection costs
• Maintenance and calibration of equipment
• Field testing
• Process audits

• Prevention Costs of Poor Quality
• Education and training
• Quality planning
• Engineering and product development
• Performing pilot runs
• Supplier qualification
• Customer interface
• Controlling processes

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Reduced Cost of Poor Quality
Cost of Poor Quality ( of Sales)
of Defects
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Example Results from Six Sigma
An estimated 2,350,000 to the BOTTOM LINE.
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Six Sigma Roles

• SUPPORT
• Sponsors
• Leadership/Sr. Management

• PRACTITIONERS
• Black Belts
• Green Belts

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The Role of Sponsors

• Ask the right questions of the Belts.
• Review project progress recognize project
  status.
• Belts in training should have projects reviewed
  weekly.
• Provide leadership direction.
• Select projects relevant to business goals.
• Prioritize and scope projects.
• Breakdown barriers a Belt may encounter.
• Are stakeholders in project financial results.
• Have a vested interest in project completion.
• Capture and report financial/business results.
• Are committed to process improvement.
• Drive for project closure and results.
• Assist with the Control and Rollout phase.
• Ensure a control plan is in place and accepted by
  process owners.
• Are personally committed to and held accountable
  for achieving project success and business
  results through their support of Six Sigma
  projects.

Challenge the Status Quo
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Asking the right questions is a critical role of
the sponsor!
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The Role of Leadership

• Identify critical projects.
• Link to the strategic plan and prioritize
  accordingly.
• Lead the behavior change.
• Drive appropriate behaviors through metric
  selection.
• Challenge the status quo/current processes.
• Communicate a shared vision.
• Enable others to act with Six Sigma thinking.
• Set an example of Six Sigma behavior.
• Walk the Talk
• Provide a Six Sigma ready environment.
• Are active in personal development plans/career
  planning for Black Belts.
• Create processes to retain Black Belts.
• Are personally committed to and held accountable
  for achieving project success and business
  results through their support of Six Sigma
  projects.

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The Role of Black Belts

• Are change agents that coordinate, promote,
  manage, and lead the different phases
  (D-M-A-I-C1) of process improvement projects for
  which they are responsible.
• Assist Sponsors with selecting, prioritizing, and
  scoping projects.
• Call on the Sponsor for assistance when required
  and keep him/her informed of project milestones.
• Are proficient in applying the process
  improvement tools through the D-M-A-I-C roadmap.

1Define, Measure, Analyze, Improve, and Control
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The Role of Black Belts

• Promote the Six Sigma concepts and principles to
  team members.
• Give direction to the teams coach, mentor, and
  provide informal training of the Six Sigma
  methodology for team members.
• Attend four weeks of intensive Six Sigma training
  done by Master Black Belts.
• Are 100 dedicated during the training period.
• Are personally committed to and held accountable
  for achieving project success and business
  results through their Six Sigma projects.

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The Role of Green Belts

• May lead Six Sigma project teams may participate
  on a Black Belts team.
• Incorporate Six Sigma into their current
  functional role.
• Call on the Sponsor for assistance when required
  and keep him/her informed of project milestones.
• Create the critical mass for the Six Sigma way
  of thinking.
• Utilize and understand many process improvement
  tools and the D-M-A-I-C roadmap.
• Attend two weeks of intensive Six Sigma training
  done by certified Black Belts or Master Black
  Belts.
• Need time to practice through project work.
• Are 100 dedicated during the training period.
• Are personally committed to and held accountable
  for achieving project success and business
  results through their Six Sigma projects.

Define, Measure, Analyze, Improve, and Control
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Six Sigma Training Process

• Four weeks (20 days) of intensive training for
  Black Belts.Two weeks (10 days), of intensive
  training for Green Belts.
• Five-day classroom training sessions with three
  to four weeks in between training weeks to apply
  techniques to projects.
• Weeks 1 and 2 are identical for Green Belts and
  Black Belts.
• Project discussions during week one.
• Video-taped project reviews during training
  weeks.
• Extensive use of hands-on tool application.
• Use of Minitab software for data analysis.
• Group exercises and assignments to reinforce
  concepts.
• Weekly course evaluations.

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Module Objectives

• Six Sigma OBJECTIVE
• Definition
• History of Six Sigma
• Data collection and decision making
• Benefits and results
• Roles (Sponsor, Black Belt, Green Belt)
• Six Sigma FOCUS
• Y f(x)
• Six Sigma DEPLOYMENT

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Six Sigma Focus

• Gain process knowledge...

• Achieve continuous process improvement.
• Make fact-based decisions.
• Apply the right tools to meet business
  objectives.
• Make positive behavioral changes.
• Identify and eliminate variation.

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Understanding Processes
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Six Sigma Focus
Understanding the Process
Making Process Improvements
Obtaining Desired Business Results
Achieving Customer Satisfaction
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Shifting the Focus
Quality efforts must shift from END-PRODUCT
evaluation to the PROCESS of creating a product
or service. If the xs are consistent then it
will not be necessary to inspect the output (the
Y). The xs will predict that the Y will be
acceptable.
Y f(x1,x2,x3,,xk)
xs are the factors that contribute to the
production of a result
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100 Inspection?
Does 100 Inspection eliminate the possibility
of defects getting to the customer? ABSOLUTELY
NOT!
If you are producing defects there is always the
chance that some of these defects are passed on
to the customer.
Defects Can Escape!
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Understanding the Process
Y f(x)

• Understand and control the xs!
• Eliminate the need to inspect Y.
• Reduce the variation in the Y.
• Re-direct inspection to focus on the PROCESS.

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Examples
Y f(x1,x2,x3,,xk)

• Order entry time f(employee experience, of
  line items, time of day, time of year)
• Order replenishment time f(downtime, inventory,
  WIP )
• Bond strength f(force, time temperature,
  material)
• Coating thickness f(time, temperature,
  chemicals, conductivity)
• Wire Diameter f(speed, die, pressure, tension)

Six Sigma RESULTS f(projects, candidates,
training, management)
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Module Objectives

• Six Sigma OBJECTIVE
• Definition
• History of Six Sigma
• Data collection and decision making
• Benefits and results
• Roles (Sponsor, Black Belt, Green Belt)
• Six Sigma FOCUS
• Y f(x)
• Six Sigma DEPLOYMENT

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Typical Six Sigma Launch

• Month 1 Identify Internal Requirements -
  Conduct an Executive/Management Overview (1 day
  training.)
• Month 2 Establish Deployment Plan - Company
  leaders communicate the plan to staff . -
  Select Six Sigma Sponsors.
• - Six Sigma Projects are beginning to be
  selected based upon the business goals.
• Month 2 - 3 Six Sigma Sponsor Training (3.5 days
  of training) - Finalize critical projects
  ensure linkage to business goals.
• - Select Black Belt (BB) candidates.
• Month 3 - 4 Launch Black Belt Training (20 days
  of training)
• - Sponsors and Master Black Belt (consultant)
  review the progress of the Six Sigma
  projects.
• - Green Belt Training (10 days) may be started
  with BB training.
• Month 4 Continue Project Reviews and
  Communication Efforts
• - Continue to review projects and communicate
  successes.
• - Conduct Team Process/Awareness Training (1
  day training.)

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Six Sigma Deployment Strategies
Strengths
Weaknesses

• Sarcasm tendency- Buzzword focus- Resource
  intensive- Inflexibility

• Awareness- Common language- Common road-map

Entire Organization
- Lack of common language- Little penetration
outside of engineering- Lack of management
understanding

• Focus- Engineers learn tools- Critical mass
  in engineering community- Project focus

Engineering Organization

• Lack of common language- Little penetration
  outside of projects - Isolation of Black
  Belts- Elite Attitude tendency

• Less cost to train- Projects aligned with
  strategic goals- Strong project focus- Very
  flexible training content

Strategic Individuals and Projects
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Project Selection Lessons Learned

• Ensure the project is linked to the overall
  business goals of the company.
• Be sure the project is focusing on improving
  customer satisfaction.
• Ensure the project is focused on reducing
  variation and will require the use of Six Sigma
  tools.
• Focusing ONLY on the savings may drive the wrong
  behaviors.
• Training projects should allow the use of many
  tools even if the cost savings are not huge.
• Scope the projects such that they can be
  completed in less than six months this may
  involve breaking projects into sub-projects.
• Carefully link projects with the appropriate
  candidates.
• Use the project contract!

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Candidate Selection Lessons Learned

• Spend the necessary amount of time to select the
  right Black and Green Belt candidates.
• Ensure the Black and Green Belt candidates
  possess the required characteristics.
• Highly motivated strong computer skills
  leadership ability willing to learn new
  techniques technical ability.
• A proper selection ensures a high of success.
• Allow the Belt candidates time for training and
  project work.
• Ensure the Belt candidates have the right team
  members/resources.

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Training - Lessons Learned

• Carefully select and scope the training project.
• The main objective is on learning, not on
  benefits.
• Do not underestimate the importance of the soft
  skills.
• Projects deal with processes handled by humans.
• Supply your BB with plenty of change management
  tools and techniques.
• Resistance is often passive and might go
  unnoticed for awhile.
• Give the BB candidates time to work on their
  projects especially during the training months.
• Incorporate local examples into the training when
  possible.
• Select the training program carefully!
• MBB instructors should have extensive project and
  training experience.
• Ensure the training program offers project
  support.

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Management - Lessons Learned

• Management commitment is critical.
• Project reviews by the sponsors and
  management/leadership team will help ensure
  project success.
• Performance goals for Belts and their sponsors
  should be linked to project results.
• Establish and follow plans for Reward and
  Recognition for the Belts AND their teams.
• Consider Black Belt retention plans.
• Establish metrics for managing and continuously
  improving the overall Six Sigma program.
• Communicate project successes and best practices.

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Six Sigma Summary

• Six Sigma OBJECTIVE
• Definition
• History of Six Sigma
• Data collection and decision making
• Benefits and results
• Roles (Sponsor, Black Belt, Green Belt)
• Six Sigma FOCUS
• Y f(x)
• Six Sigma DEPLOYMENT