The Icfai Univel'sity .

JoIlI'nal of
Operations
Managelllent
Vol. VII No.3 August 2008
The Idei University Press
t www.iupindia.org
,
-
Six Sigma in Indian Automotive
Components Sector: A Survey
Prabhushankar G v r S R Devadasan'" and P R Shalij

This paper examines the status and issues of Six Sigma program in Indian
automotive components sector. Using an empirical approach, the paper traces
improvements in sigma level, savings achieved, metrics used for measuring the
performance of Six Sigma project and the methodologies adopted. The result
from .a survey of 25 companies suggests that financial constraint is the
significant barrier for implementing Six Sigma. Increase in profitability and
reduction in the cost of poor quality are the significant benefits. Critical Success
Factors (CSFs) were analyzed and compared with earlier researches. Except
'linkihg Six Sigma to employees' and 'linking Six Sigma to suppliers' all other
CSFs:were.tuond to be significant. The study finds that only a small percentage
of automobile components sector has implemented Six Sigma. 'Not a statutory
requirement' and 'not insisted by customers' are the prominent reasons for not
implementing Six Sigma. This paper suggests that Indian automotive components
sector implement Six Sigma along with. ISO/TS 16949, in an integrated
manner, in order to gain access to the global market.

Introduction
Many developing countries have liberalized their economies (Balasubrahmanya, 2005)
and opened automotive and other sectors for private players, which has turned the
entire globe into a single industrial market resulting in unprecedented competition
(Hwang and Lee, 2000). Due to this, the business environment surrounding the
automobile industry has changed rapidly and has become turbulent, complex and
even chaotic (Haikonen et al., 2004). Tobeat the competition, newproducts are being
developed more frequently and product life cycle is getting shrunk. Customers'
expectations have started increasing, and they expect higher quality products at lower
prices (Adam and Ebert, 2002; and Haikonen et al., 2004). This has necessitated
Research Scholar, Department of Production Engineering, PSG College of Technology, Coimbatore,
India; and the corresponding author. E-mail: prabhu.gvp@gmail.com
Professor, Department of Production Engineering, PSG College of Thchnology, Coimbatore,
India. E-mail: devadasan_srd@yahoo.com
Lecturer, Department of Production Engineering, Government Engineering College, Thrissuz India.
E-mail: shalij123@gmail.com
2008 The Icfai University Press; All Rights Reserved.
eempanies.tobe'proactive andinnovative not only in product design, but also in the
waythey manage issues like quality, cost and delivery (Makrymichalos et al., 2005).
sector contributes only 5% to the country's industrial output,
to in developing countries like 'Mexico and Brazil and 15-17% in
developed countries like USAand Germany (Khanna etql., 2002; www.unescap.orq) ,
of the Indian automotive sector is muchhigher than that
machinery, and.process industries (Dangayacha and Deshmukh, 2003),
In spite of this, its contribution to GDP (Gross Domestic Product) is still,.hoverinq
around 5%. With Indian GDP expected to grow ata-10%for the next few years. (Kant,
2006).Indian economy requires a major contribution from the automotive sector. This
the interest to study competitive strategies adopted by Indian automotive
set;tor to meet in quality frontier. 'The study isrestricted to automobile
components manufacturinq sector as tt has' emerged as one of the fastest growing
(15%) sectorsin the Indian industrial scenario (Kant, 2006).
:qrganizations have been adopting different. models for quality improvement.
Plan-Do-Cheek-Act (PDCA)model for quality unprovement and quality movement,
started for post war reconstruction in Japan-by Deming, Ishikawa and Juran, paved
the,w,ay torthe developmentof these qualityimprovement models (Raisingh,ani, 2005).
During the past half of the century, more'than 69 quality related models have come
into existence. Statistical Process Control (SPC), Quality Circles (QC), Total Quality
Manaqement Bench Marking, ISO 9000 Ql,laij.ty Management SYstem (QM:S)
Standard, Six Sigma and other such models. have created a visible impact in the business
world (Dedhia, 2005)'.As a recent methodology of process improvement, SixSiqma
has permeated business life (Haikonen et al., 2004).
Six sigma programs, which encompass established statistical approaches with a
systematic and quantifiable project-based improvement methodology, are proving to
be extremely effective in tracking down the real causes of variation (Mortimer, 2Q06).
Byadopting this new approach, an ever increasing. number of companies of all sizes,
are nowestablishing a far betterunderstandinq andgaining much tighter control of
their processes. This has resulted in generating significant cost savings along with
increased customersetlsfactlon and improved. profitability (Mortimer, 2006).
As companies embark on their problem-solving journey,' they need to be aware of the
multitude of programs, -tools, and approaches to organize their methodology.
" .. , I.
Hence the research was undertaken to explore the status ofawareness and adaptation
ofQMS,!siX: Sigma and' c8mponents manutacttirinq sector
of India. The scope of this paper is restricted to reporting the findings on Six Sigma
only..
Indian
After, 44 yearsof cOl}.trolledaJ;lcl .protected but, with. 3 Go.P
growth till 1980, the Government of India started its economic policy from
. , -', ", ,.; - 'j" ' ,
Six Sigma/in'IJldiaJr Aatom,?tiYtl 1(';omponents. Sector., A Survey H. 19
1991 in a phased manner. The average growth in GDP in the first decade of post
reforms was 6.1%, which is 0.4%higher than the a.verage of the 1980s, which was 5.7%
(www.unescap.orq). The GDP has made an impressive growth of 7.5,9.0 and 9.4% in
the last three and is expected to touch 10
%
in the year 2007-08 (TOI, 2007).
Indian Automottve Sector
Automotive industry, one of the Important and largest industries in India,
is witnessinqan impressive growth since economic reforms were initiated, and is a
prominent driver of the Indian economy. As mentioned earlier, it accounts for about 5%
of GDP and has created 10.5 million jobs throuqh direct and indirect employment
(Kant, 2006). automotive industrytoday boests of being the largest
and second largest two-wheeler manufacturer, second largest tractor manufacturer
Thble ,1: Production and, Export Trend
2005-06 (Numbers) 2006-07 (Numbers)
CatelJoiy
Total Total
Export
Production
Eqxrt
Production
:
Passenqer Cars ' 10,46,133 1,69,990 12,38,032 1,92,745
Utility 1,96,506 4,489 2,22,111 4,403
MPVs 66,661 1,093 84,707 1,330
Total Passenger Vehicles 13.09.300 1.75.572 15.44.850 1.98.418
M&HCVs 2,19,295 14,078 2,94,266 18,838
LCVs 1,71,788 26,522 2,25,734 30,928
'IOtal Commercial Vehicles 3.91.083 40.600 5.20.000 49.766
Three-Wheelers 4,34,423 76,881 5,56,124 1,43,896
Scooters 10,21,013 83,934 9,43,974 35,685
Motorcycles 62,07,690 3,86,054 71,12,225 5,45,887
Mopeds 3,79,994 43,181 3,79,987 37,566
Electric Thro-Wheelers - - 7,982 -
Total '!'wo-Wheelers 76.08.697 5.13.169 84.44.168 6.19.138
Grand Total 97.43.503 8.tJ6.222 1.10.65.142 10.11.278
Source: Www.indiabusiness.nic; www.unescape.org, accessed on July 3, 2007.
and fifth largest commercial vehicle manufacturer in the world.
(www.indianbusiness.nic.in). According to estimates, India will overtake Germany in
total sales volume by 20.10and Japan by 2012 (Bhupta, 2007). Table 1 shows the total
production and export of the various types ofvehicles in the last two years. Table 2
shows the main export destinations.
20 The Ida! VIIi_Ity Journal 'otoperatlonl Management; Vol. VII. No. 3.2008
Table 2: Main Export Destinations
Cars Egypt, Kenya, Nigeria, Somalia, Tanzania, Afghanistan, Nepal,
Hungary, Greece, Italy, Netherlands, Spain, Austria
CVs Egypt, African Countries, Nepal, Sri Lanka, Jordan, Kuwait, Hungary,
Russian Federation, France, Brazil
1\vo-Wheelers African Countries, Bangladesh, Sri Lanka, Turkey, United Arab
Emirates, Paraguay, United Kingdom, Germany, Mexico, Australia,
Hong Kong, China
Source: www.unescape.org, accessed on July 3, 2007.
Indian Automotive Components Sector
In tandem with the industry trends, the Indian automobile components sector has
shown enormous progress in recent years in terms ot growth, spread, absorption of
I
new technologies and flexibility. The arrival of global vehicle manufacturers fromJapan,
Korea, USA and Europe gave impetus to the Indian automobile component industry.
Today, India is emerging as one of the key automobile components centers in Asia and
is expected to play a significant role in the global automotive supply chain in the near
: future (www.indiainbusiness.nic).
This sector has around 500 firms in the organized sector, which contribute to more
than 85% of production, and over 10,000 in the small sector, which account for the
remaining 15%of production (Kant, 2006). India has also emerged as an olitsourcing
hub for automobile components for international companies such as Ford, General
Motors, Daimler Chrysler, Fiat, Volkswagen and Toyota.
Indian automobile components sector has been exporting around 18%of its output
and growing at the rate of 2.8%. The principal export items include engine parts,
transmission parts, suspension and braking parts, electrical parts, and body and chassis
parts (www.ibef.org). The total export of automotive components in the year 2004-05
and 2005-06 was INR 6.237 bn and INR 9.127 bn respectively. Growth apart, what has
been remarkable is the quality standard and scale achieved by this sector. International
spread, reputation of cost competitiveness and delivery adherence epitomize these
achievements (www.indiabusiness.nic; Kant, 2006).
Overview of Six Stgma
Six Sigma was started at Motorola in 1987 to improve the quality of their products.
However, this concept gained popularity only after GE implemented it in 1995 (Park;
2003). Ever since GE's success, Six Sigma spread like wildfire and proliferated to
transactional and service activities and also to SMEs (Antony, 2006). T h i ~ created
interest among the academicians and they started showing interest from 2000 onwards
(Nonthaleerak and Hendry, 2005).
Six Sigma in Indian A.tomoUve Components Sector: A Survey 21
Views on Six Sigma i "
Six Sigma has been defined ways by variousauthors. Pande et al. (2003)
have defined Six Siqme asa comprehensive and. flexible system for achieving,
sustaining and maximizing business success. Six Sigma is uniquely driven by a close
understandinq of customer needs, disciplined use of fads', data, 'statistical analysis
and by paying diligent attention to and reinventing business
process (Hensleyand Dobie, 2005; and Mahanti and Antony, 2005).
According to Siviy et a1. (2005), Six Sigma is a holistic .approach to business
improvement that measurements, improvement
frameworks, and a tool kit, all of which are intended. to complement and enhance
existing engineering, service, and manufacturing processes and-can serve as both.an
enterprise qovernance model and.a tacticalimprovement engine. Yet another defi-nition
proposed by O'Neilland P\,l;vall(20Q-5} views Six ?igIIla (is an approach forimprovinq
services, which strivesfor near perfection, i.e., not more
than 3.4 Defects Per Million Opportunities, (DPMO). It is a disciplined, data-driven
a'. for, eliminatinq detects in any process, tlms. i,s
Prhdllctof;that .., . . '
six Sigma Improvement Model
There.havepeen many.models for process. Improvementand process desiqnzredesiqn,
Most of.these models are based,On PDCAcyde introduced by Deminq (Pande, et 91.,
2(03). statistical thinkinq is .embodied .Siqma's methodoloqies,
wp.icP.areusedas the basis projects et, al.,
The following frameworks currentlyprevail: .
Define, Measure.Analyze, Improve, Control (DMAIC) a five-phase improvement
was by dE' (Park, 2003). This improve and
: ',' ','"
,.: ; .. , t ; : ., .,. , .. ' > _..! .
pesigq.Jor Six (DFSS)is used to desiqn newproducts endprocesses, endto
redesign and processesthat have.been
meet tit,Ef performance lattercase )J.q.s ,l;!e;q.
from Five o.f performance to' aSix (HaT!)' .
2000). Define, Measure, Analyze, Design, Verify (DMADV) ,is the most widely used
,t , .... . .,:
framework (Park, 2003).
Research Design
, ; \ J. ! ' t -. ..'. I .,'" '. I ...'. .' ".', . .' _ :
In the .qlobal the automobile componentsmanufacturinq companiesare
classified as Tier-I and suppliers (Bennett and O'Kane, 2006). The Tier-I
suppliers are those which supply components to the Original Equipment Manufacturers
(GEMs). suppliersare supplycomponents to
[Pickernell, 1997; and Aghatadeh, 20(3). The survey reported here was conducted
from May 16, 2007 to June 30, 2007 and was restricted to companies located in and
22 The Ictai University;Journal-of'.Qpuations Management; vei. VII,
around Bangalore city of-Iadia. A\.ltogether25.compenies were surveyed, 9lJ.1l of which
20belong.t(),Tier-.I.category to the Tier-II category. Thepersonnel
Interviewedwerequality engineers and managers. The number of respondents in
each company differed, which had resulted ina total of 49 respondents. Wherever
there was more than one respondent, a consensus opinion was sought, which was
arrived at after having a discussion among them.
Design of Questionnaire i
'. "Ji'.;.,.4 _ .. ,",") .
A questionnaire was framed based on the literature and the inputs qrven
by 'practitioners arid was used to conduct a and direct'
form dfinterview to"collect data: ThequestionnaJre consisted of four sections.
The' first" section: of the to collect fundamental
information 'aboutthe company such' as its' name, year of inception, "number
of' employee's currently working, major products produced, sales income, etc.
the second section of the questionnaireconsisted of questions related to ISO
9001:2000 and TS 16949 QMS standards. Questions pertaininqto SiX
number ofprojectscompleted.financial benefits obtained, improvement insigma level,
methodology adopted, anddifficulties eIicour'ItEired while implemeritingSix Sigma, were
induded in section three and are shown in' Appendix. Ouestions aiminq to gather the
data on the perceived meaning and enablers of innovation and innovation performance
measures were 'included in the fourth section.
Backgrou,ndof Suppliers
The major.components produced by the 20 suppliers surveyed under this category
included forged .and .machined components, radiators, air-conditioners, bearings,
automotiveseats" accelerator and: clutch cables, windowregulators, speedometers,
fuel injection pumps" le engine valves, wiring harness,andinjectionmoulded
automotive .intertor and exterior, parts. Five companies were-Multinational
Companies(MNCs)" four companies were listed on the stock exchange, and one was
a 100%export-oriented unit. The number of employees employed in these companies
varied from 110 to 3,000. The sales incomewas inthe ranqe.ot 40H,800,nmINR.1'wo
companiesdid not disclose theirsales income. All the 20 companies are certifiedto TS
1,6949 standards. Table 3 shows the summary of the year of first QMS certification and
Table 4 shows the summary of standards adopted by Tier-I suppliers.surveyed.
Table" 3: of Obtalninq QMS Certification
Year of First Certification Number of Companies' . ' "" ";" Percep.tage ,"
Before 1995
-'.'
,
:4'
20
.: ..
'"
'" ..
, ,,",'
10
"
50
.. '
.
"' "
,
; 2001-,2005 '",'" ) .' . .
""
..
5 2S
2005" onwards
:
1 5
,
"
,
"
'i, .1" t
"
,
"
.. ... , ,c.
..
Sb;Sigmain:.lndian AutomqtiveComponents Sector: A Survey", " 23
'Iable 4: Summary of Companies Certified to System Standards
System
Number of Companies Percentage
TS 16949 20 100
ISO 14001 13 69
OHSAS 18001 '3 15
Background of Tier-II Suppliers
As mentioned earlier, five companies were surveyed under this category. In total.
eight members from five companies participated inthe interview. All the companies
became operational between 1987 and 1991. The major products produced by these
companies included seat belt accessories, brake assembly accessories, electrical parts,
and window regu,lator components. The number of employees in the companies varied
from 10 to 50. The sales income was in the range from 8-50 mn INR. All the five
companies were certified to ISO 9001:2000 and none of them were certified to any of
the other systems such as TS 16949, ISO 14001 and QHSAS 18001. All the companies
manufactured products according to the design and drawing provided by the Tier-I
suppliers. In a majority of the cases, the tooling and raw materials were also provided
by the Tier-I suppliers.
Although, organizations in the industrialized countries have progressed well
in the application of quality systems, organizations in the developing countries have
been latecomers (Bayati and Taghavi, 2007). The same has been observed in this
survey with Indian automotive components manufacturers too. It is clearly evident
from Table 3 that a majorityof the companies obtained their first QMS certification
only after 1996. For developing countries such as India, there may be greater urgency
in terms of addressing environmental and societal problems (Puay et al., 1998). In this
direction, 69%of Tier-I companies have been certified to Environmental Management
System (EMS) but none of the Tier-II companies have been certified to EMS.
Data Analysis, Results and Discussion
The details of the analysis of data gathered are presented in the following subsections.
The results are SUbjected to discussion. The responses'for barriers, benefits and Critical
Success Factors (CSFs) of Six Sigma were analyzed by computing three statistical
parameters namely mean, Standard Deviation (SD) and t-value.
Six Sigma Implementation
Out of the 20 Tier-I companies surveyed, only six have implemented Six Sigma. One
companyimplemented Six Sigma programin the year 2005, two inthe year 2006, and.
the remainingthree in 2007. Three companies have hired the services of the professional
consultant in training and implementing Six Sigma. The other three companies deputed
their personnel for external traiIling and'they in turn trained others and monitored the
implementation. Annual savings reported by five companies from Six Sigma projects
, . _',_,;,h. ',.
24 The Ictai University Journal of Operations Management. Vol. VII, No. 3, 2008
vcuiedbetween 1.5mn INR and 3.5 mn INR for the year 2006-07. One company didn't
di4clQse the savings gained. Improvement in sigma level for the various projects carried
out by the six companies range between 0.2 and 1. Five companies have rated their
Six Sigma project as 'partially successful' and one as 'successful' on a scale of-
highlysuccessful; successful; partially successful; failure; total failure. Three companies
'. . . - .
aril using Minitab in the implementation of Six Sigma, and the other three are using
packages like Microseft Excel, for data storing and making simple
None of the Tier-Il have implemented Six Sigma.
Sigma Organization
'lable 5 shows the number of Six SigIlia trained employees (Belts) and their ratio in the
sPtSixSigma companies surveyed. Considering the total number of trained personnel
employees in all the six organiutions put together, it is observed that for every
Black Belt (MBB), there areten Black Belts (BBs). For every BB, there are
only four Green Belts (GBs).and one BB for every 124 employees. These ratios are
contrary to the one mentioned in literature. Acommon guideline is to have one BBfor
every too employees, around 20 GB$ for every BB, and 20 BBs for every MBB (Park,
2003). :Once Six Sigma program spreads to the depth and breadth of these companies
over a period of time, ratios may come closer to that mentioned in
literAture.
I:"
,:
..
Table
S,
Number of Belts
ComJliUW
Number of
MBB
liB
Ratios
Employees
GB
BB: E* BB : GB MBB: BB
Cl 400 1 5 20 1 : 80 1 : 4 1 : 5
.C2 345 0 1 4 1 : 345 1 : 4 -
C3 3

100 1 : 100 1 : 3 1 : 10
C4 350 0 1 8 1 : 350 1 : 8 -
C5 354 0 0 5
- - -
ce
280 0 1 8 1 : 280 1 : 8 -

4',729 4 38 145 1: 124 1 : 4 1 : 10

1 : 100 1 : 20 1 : 20
...,
Note: W Number of employees.
..
Sa Sigma Projects
The different types of Six Sigma projects embarked by six companies are
in 'lable 6. Interestingly; all thesix companies concentrated Onlean projects such as
redueinq the cycle time and work in process, in addition to reducing defect rates. This
is mainlybecause of the high volume and repetitive nature of production, which is
typical of automobile 'components sector. Six' sigma is a generic improvenient
3,
Six Indian AutoQJolive Components Sector: A Survey 25
methodology and one can choose waste or cycle time as, CTQs (Critical to Quality
Metrics). as physical properties of products (Hoed, 2004). The present studyconfirms
this fact
Six, Sigma ,
TablEi,,7 shows various. methodologies adopted by-the Six Sigma companies. All the six
companies have adopted DMAIC methodology, whereas only one company has used
DFSS in addition to DMAIC. Interestingly, all the six companies have used DMAIC
and lean. This espouses the factsthatSix Sigma projects aimfor bothwaste elimination
as well as defect reduction.
Table:6: Performance Measures of Six Sigma Projects
Performance Measures
of
'Percentage
, Comlla.nies
Reducing Number of Customer- Complaints 4 67
Reducing Scarp 1 17
Cost Reduction 5
' ,
, 83-
,!lefect rate)
;
Improving Yield 6 100
Process .Capability 4 67
Reducing :Cycle Time
...
.100 6
Reducin.g WIP: 6 100
,
" .
'-
,
Table '7: Six Sigma Methodologies Adopted
MethQd,ology
Number of
Percentage
Companies
DMAlC 6 100
DFSS (DMADV/IDOV) 1 17
DMAlC 4- Lean
'"
6 100
{)FSS methodology is used basically for, designilW new products and processes.
DFSS is also applied when achieving improvement is difficult, using DMAIC.
For most of the automobile components manufacturers, product design; specifications
and process parameters ate provided by OEMs. Further,there exist a lot of opportunities
for improvements using DMAIC methodology. Hence, very little application of DFSS
is found.
Barriers to Effective Implementation of Six Sigma
Table 8 shows the barriers to the.effective implementation.of, Six Sigma. Companies
. .'.,' ." I ": "." . ; . _. "
have been .asked to rate the following factors that were felt.to be the barriers for
implementing Six program on a Likert scaleof 1to 5. .The results of the analysis
showthat the six companies felt onlyfulqncicil coPstJ.'aiIl.t to be significant
26 The Idai University .JournalotOperations Managemeat; VoL VII, No. 3, 2008
at 0;1 level of significance.:This indicates the fact that it is easy to implement Six
Sigma program in the Indianautomobile components sector, as only one barrier is
found to be significant out of 'the eight.
lable 6: Barriers for
,
Six Sigma Program
.B..mers
,
Mean SD !,value
I
Financial Constraint.
.-
l
, 3,.33 0.52
Time Constraint, "
"
3.00 1.10 0.00
Difficulty in .Understanding Complicated
Statistical Tools
.,
3.00

LlO 0.00
Lack of Management Exposure
' -
2.00
:
1.10 -2.24
Work }:;orceIUnioIl Resistance" 1.83 0.75 ':"-3.80'
Training"
,
(83 0.75
,
Expensive Consultation Charges 2.00 0.Q3
__3.87
in Understanding
Sbt Sigma .Methodology
...
" 1:83'
..
;' -7.00 i
J
, ..
Note: Not at all a ,barrier tQ '5' Highly r-value
=
1.476 for 5
deqrees qf .freedom.
,.
Benefits 0' Six SigmtJ,Program ."
'Dt.ble 9 shows the various benefits of the SixSiqma program. Companies have been
asked to rate benefits on a Likert scale of 1 to 5. The results of the analysis-show that,
,. ,lable ;9:,Beaefits of. Six .Sigma
,
,
Benefi.ts '.1
Mean ,SD, t-value
.lteduction in COPQ 4.17 0.41 7.00
Increase in profitability 4.33
..
0.52 6.32
;
Improved pioductquality 3.83
9.41
5.00
Improved companr image 3.83 5.()O
Reduction in .process variability, 4.00 0.63 3.87
Increase in productivity 4.00 0.63
I,
3.87
Reduction. in customer complaints 4.00 0.89 2.7A
Reduction of cycle time
[
. 3.83 1.17 ,1.75"
Improved work culture '3.17 0;75
..
0.54

Improved employee 'morale! motivation 3.00 ... 0.63 1 0.00
Improved sales
,
2.33
,
0.52 -3.16
Reduction in inspeetion
"
2.33
,
0.52 -3.16
- ..
Note: '1' No benefit to'S' exnellent.or maximum benefit; tvalue = 1.476 for 5 degrees
of freedom.
,
.-.. -
27
in line with the Six Sigma philosophy of bottomline results, these Six Sigma companies
have also derived significant financial benefits through reduced Cost of Poor Quality
(COPQ). Increase in profitability, a second siqnificant benefit, is a natural outcome of
the reduction in COPQ. Improved product quality has helped companies to improve
their imaqe and both these benefits come out as third significant benefit. Reduction in
process variability and an increase in the productivity findthe fourth place, Reduction
in customer complaints and cycle time are the two other significant benefits. Six Sigma
proqram did not result in improved work culture. This can be attributed to the reason
that three companies have not hired the services of a professional consultant.
No significant benefit in terms of improved employee motivation! morale has been
achieved. This may be due to the fact that five out of the six companies have not tied
the incentives or bonus to the success of Six Sigma projects. Six Sigma is basically
used for the improvement of internal process and efficiency. To achieve the external
benefits s ~ c h as improved sales or market share, they are required to travel a long way
in their Six Siqma journey.
Critical Success Factors (CSFs) for Six Sigma
The Six Siqma companies were asked to rank the 11 CSFs on a scale of 1 to 5.
The CSFs used in this study were derived from the existing literature of Six Sigma
(Antony et al., 2005). The aimwas to prioritize the CSFs, which the Indian automobile
components sector felt to be significant, and make a comparative studywith the CSFs,
identified from previous studies. The practitioners of the Six Sigma companies surveyed,
have agreed to most of the CSFs mentioned by Antony et al. (2005). The data gathered
are summarized in Table 10.
Table 10: Critical Success Paetors for Six Sigma
Critical Success Factors Mean SD t-value
Trainlng 4.67 0.52 7.91
linking Six Sigma to customers 4.67 0.52 7.91
Project Prioritization and Selection 4.67 0.52 7.91
Project Management Skills 4.33 0.52 6.32
Cultural change 3.83 0.41 5.00
Management Involvement and Participation
(Leadership) 4.00 0.63 3.87
Understanding of Six Sigma Methodology 4.00 0.63 3.87
linking Six Sigma to Business Strategy 3.67 0.52 3.16
Organizational Infrastructure 3.33 0.52 1".58
linking Six Sigma to Employees 3.17 0.41 LOO.
linking Six Sigma to Suppliers 2.67 0.82 -1.00
Note: l=Least important; 2::::Less important; 3=Important; 4=Very important; &l1d
5::::Crucial; t-value :::: 1.476 for 5 degrees of freedom.
28 The Idai University Journal of Operations Management. Vol. VII. No. a. 2008
As shown in Table 7, training, linking Six Sigma to customers, project prioritization
and selection topped the list of CSFs, followed by project management skills. Cultural
chanqe camenext. Management involvement and participation, and understandinq
SixStgma ,tn@thodology stood at the fourth level. linking Six Sigma to business strategy
- .',.' .:,. '.
and organizational infrastructure are also rated as significant. Linking Six Sigma to
and suppliers were rated as not significant. This shows that companies
l,lav4i not linked their Six Siqma program to their. employees and suppliers. This is
evident from the benefits discussed in tile previous section that there is no improved
Vlork culture, or employee morale/motivation and no reduction in inward goods
inspection.
Industries in developed countries are mature and place stronger emphasis on
suppliers through longer-term strategic plan involving supplier management and
training, compared to developing countries (Puay et al., 1998). Automobile components
sector in a developing countrylike India too has failed in strategic supplier management.
As employee motivation is extremely important in the successful implementation of
Six Sigma, the management should link-Six Sigma program to its employees, through
incentive-based compensation, an employee ownership plan and the implementation
pf work-based teams (Motwani et al., 2004). This sector failed to .understand the
of this particular CSF, and presumably this may be the reasonjor the
improvement in sigma level (0.2to 1), for the projects embarked bythe companies
surveyed,
These findings were quite contrary to the findings from the previous studies carried
out by Antony et al. (2005) in small and medium-sized UK manufacturing enterprises.
Results ofthat particular study showthat management involvement and participation,
linking Six Sigma to customers and linkinq Six Sigma to the business strateqy of the
orQanization are the most important factors for the successful implementation of Six
Sigma, followed by organizational infrastructure, understanding of Six Sigma
training on Six Sigma, and project prioritization and selection. Thble 11
gives comparison of the present and.previous study. This difference in the priority
,tl:ached to CS,Fs can be to due to the fact that India is a developing economy and the
4ll1ulltrial culture and environment surrounding India are different from that of UK.
Ileasoqs ,tQJ' Not Implementmq Six Sigma
'tl1ble 12 shows the summarized data gathered to examine the reasons for not
[mplementinq Six Sigma.
The reasons for not implementing Six Sigma among the remaining 14 Tier-I
companies were analyzed. All the companies have agreed that 'not a statutory
requirement' as the main reason for not implementing Six Sigma. 'Not insisted by
the second main reason for Tier-I companies for not implementing Six Sigma.
-Followedby this is the opinion that TS 16949 standard adopted by them is sufficient to
"achieve the required quality level. Only 50% of the companies agreed that lack of
Six SiU'ma in Indian Automotive Components Sector: A Survey 29
,lable' '11: Comparison" of CSFs :with;the .Previous , Study
. !
Previous Study
,. '. :(Antony et et; 2005)
: ,
1taining'
LiriIqng Six Sigma to
..
'Rank "
I.

,
,
I
,
.
. Rank
VI
Management InvolvemenLand Participation
'Understa,nding:Of Six SigmaMethodology,
Project Prioritization .and
.Project .Manaqement ' Skills: ..
Cultural Change
Orqanizational Infrastructure
Linkinq Six Sigma to .
, ' '
.... I .,
"
IV
\ I
...
V
VI
,
;
VI
VIII'
IX
X
XI
.
VII
VIII .
VIII
I
V
III
IV
XI
X
'.' lable U; J,lea,fi9ns 19r Not, Implementing, SPc.
, . Tier-I Suppliers, : 'Tier-II Suppliers
C
NUmber .of Percentage Number of Percentage
ompames Companies
.'
Top management 'is not. interested 4
'.' '! ,; . :. i.;. . I : -' , . ; '. I ; ".'
High cost of training MBBs, BBs ana
l
t" < 2'
GBs, "... I
40
80
80
60
60
80
100 5
4
)
3
,
.
,
,.
3
"
,
.,
.--'-'-
2
..
4
,
I
" ',
4
4
"
,
,
:
,
..
21
7
29
'., , "
100
\ 50
..
86
,', 1
1
9
12
14
High cost of consultants 3
It ,. - " . .. ' - -,.' - ;.. ' - :
Not insisted by
Not a statutory requirement 'like
ISO' 90'01 and TS 16949 .
manpower who .can be,
trained as MBBs,' BBs .and' GBs '
Difficult to understand high end
statistical tools
Reason
,Quality. system presently adopted by
organization' (sPC!rQM/ISO . ,
9001;2000) is sulftclent: ,',
,Not. aware
. No; perceived.benefits
: -.,
,,' ,"
. ,,0 ..
" 0-
( ,-
o .
...
20
o
sufficient-manpower tobe trained as full ,time Sigma professionals was one of the
reasons.for hot, implementing SiXSiqma. Vert few'of the Tier-I' companies have
30 .The Idai Unive1l5ity,Jo'lIm:ahof Operatlons- Management. Vo);!VII" No. 3, 2008
\
t
r
regarded high cost associated with Six Sigma training, high: fees of consultants and
difficulty in understanding.qomplicated high end statistical.:rp.ethodologyassociated
with Six Sigma as reasons for not implementinq Six, Siqma, '
A majority of Tier-II suppliers are aware of Six Sigma and its benefits' and are
interested in implementing it, However..theyhave.not implemented.it becauseit is not
a statutory requirement. .Notinsistedby high. cost of consultants,
high cost of traini,ng . BBs .and, difficulty in understanding. ,high end
statistical tools, and expensivenessare the otherimportant reasonsfor:Tier-Il companies
for not embarkinq on. Six SigTIla program. Lack of qualified personnel and existing
QMS being sufficientto achieve :the required quality level are otherimportant reasons
for not implementing Six 5igma.. Tier-II suppliers widely held that top management
not being interested or aware of Six Sigma, and no not tll
r
reasons for not implementing Six Sigma. . '
',:,!-,'
Conclusion .
There is'little research carriedout specificallyinautomotive components manufacturing
sector to explore its journey in achieving competitiveness, Thepresent survey makes
a contribution to tiHs'arena. data and tp,efinctJ,ngs should
not only help further research agEHidas but also inform automobile components
. manufacturinq companies located in developing India' to plan and
strategize on quality continuum. r : ','0 , )
As a global, hubfor eutomobile components.Tndian automobile.components sector

QMS. Nevertheless; 'except 'for a Jew\many have 'norry-et adoptededvanced
breakthrough quality improvement-strateqiesItke Six'Sigro:a and other-continuous
process improvement techniques; Presumably; thisean-beone.ofthe important reasons
for companies not being,able to gain access to theinternational market and contribute
,., , .: .. ' .... ' " I'" ".".:
In this context, this sector needs to adopt Six Sigma vigorously in order to reap the
benefits. 'As compames needto be TSl6949 to bea globa1 supplier, and
innovative in 'process imprdvemeilt'to'be"a'niaiket'Iea:dei,' there' isia:need for an
integratedmodel whidi lJnngs under its'uIIlbieua""FS16949,' Six Signia'and innovation.
Usinq JQ :q\taliw,
operating, et ai., ,2QQH., further research.needs to be
'. '.' . "'1 ;'.' .'.":, (',: <:; ) -: , : ,,:.j i ',' " ", '" ',. .'
done in this to and acomprehensive framework, which
integrates breaIctfuOl;gh .strategy like SiX Siqma, and continuous
processimprovement-tools SUCh aslean anddnnovative problem-solvmq.rrrethodofoqy.
The survey results .orily a (24%)' of brganizatibris have
implemented SixSigma. The top management needs to be proactive
Six Sigma and focus on integrating Six Sigma with TS 16949. The findings imply that
Sb' Sigowr.iqi I Sector:, A. Survey, ", , ,. ' 31
orgartizations in the Indian automobile components sector has to embrace more DFSS
projects, expand Six Sigma projects -to the entire organization, hire the services
of g06d consultants, connect incentive schemes to tile success of Six Sigma projects,
and utilize software like Minitab for data analysis.
Linkinq Six Sigma program to employees will help in getting better cooperation,
improved work culture and morale. Linkinq Six Sigma tosuppliers will help in improving
collabbration, which shall result in the effective implementation of Six Sigma.
Orgahizations can gain much by volunteering to implement Six Sigma rather than
waiting for it to be imposed. Evaluation and comparison of CSFs of Six Siqma help
organizations in the sector to attach the requited importance to various CSFs.
of the Study
Following are some of the limitations of this study:
:. Sample size of 25 appears to be small. Study tin some more companies can
be taken up to make the results more representative.
The survey is limited to automobile component manufacturing industries
.located in the state of Kamataka.It can be extended to companieslocated.in
other parts of India too.
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ne Idal UJl1venIityt:.Jo'tlrBal '01 Operations.Mu.-eat. Vol, VII" ,No.' a. '2088
Appendix
Excerpts of the Questionnaire on Six Slgma
Section III Six S ~ g m a
l.jn which year did you start your Six SigtDil program?
( ~ . NaJDe your Six Sigma consultant:
3. How many Six Sigma projects have youcompleted till date?
4. What financial benefits/year you got from these projects for the past three years?
Pbiancial Year . Benefit in Indian Rupees
2003-2004
2004-2005
',2005-2006
5. Total cumulative financial benefits obtained till date after implementing Six Siqma
program
6. How many GB; BB; MBB are there in your company?
GB BB MBB
7. What was Sigma level before Six Sigma implementation and after implementation?
Major Six Sigma Projects .SigIDa Lewl Before Six SlgmaLevel Alter Six
Sjgma Implementation Sigma Impiementation
;'
8. Which metrics did you. use to measure the performance of Six Sigma Project?
Metric Yes No
Number of Complaints
Percentage Scrap
COPQ
Defect. Rate
Process Capability
Yield/RTY(Rolled through yield)
OEE (Overall equipment efficiency)
Cycle TimelLead Time .'
.. WIP (Work in Process)
(Contd ...)
35
10. Followinq difficulties might have, been encountered by your compa:qy while
implementinq Six Sigma, rate them on a scale of 1 to 5.
Rating
11. Rate the following benefits obtained by implementing Six Sigma
5
5
No
(...contd)
4
Yes
Rating
2 3 4
2 3
1
Benefits
Lack of management exposure
Expensive consultation charges
Difficulty in understanding complicated statistical tools
. . .

Barriers
Note: '1" Not at all a barrier to '5' Highly significant barrier
1
Difficulty in Understanding SS methodology
Financial Constraint
Reduction in process variability
Increase in profitability
Improved product quality
Time Constraint
,Work Force/Union Resistance
DMAIC - Continuous improvement method
Appendix
DMADV/IDOV(DFSS) - Break through improvement method
Lean Six Sigma - Integrated approach to improve quality and
eliminate waste
9. Six Sigma methodologies
- Methodology
Reduction in COPQ
Increase in productivity
Reduction of cycle time
Reduction in customer complaints Improved sales
Reductiontn inspection'
Improved, work culture
Improved employee, morale/motivation
Improved company image
Note: '1' No benefit to '5' excellent or maximum benefit)
36
(Contd...)
'1be Idai UniversttyJoiU'Dalof OperatioBSMaiIageRleDt. Vol. VII, No. 3, 2008
J., at
(...contd)
12. Rate the succes,s .of
'", .. " , " ' ... > :' ','" ' ,-

ia If you feel Six Sigma is a failure, rate the following factors leading to failure of
, , .. '.,
Factors
Lack of involvemeIlt and participation
,Rating
r 2'3' ."5
I Lack of teSouroes(Finanoo, human resource and' time)
: Poor"training/coaching
Internal resistance
project selection
14. Which of the folloWing software is used in the effective implementation of Six Sigma?
-Q1?jectives
ri' Not SO significant to failure to '5' Highly significant to failure
"Minitab -SPC-IV Six SigDla Suite Systat If different, PI specify
15. Following factors have been identified as critical to successful implementation of'Six
Sigma. Rank them on a scale of 1 to 5
5 3
Rating
2 1
Critical Success Factors
..
\------------------------+--+--+--+--+---{
L .. Management involvement and participation (Leadership)
i ".. infrastructure .
Cultural change

Six Sig-ma-to customers
v , linking Six Sigma to'business strategy
Linking Six Sigma to employees
I . .: . _: ... ',.... '. .- ',' ' .
,
0' , understanding, of Six'Signia methodology
i'r J'rt)fect IIiaO.ag$entSkills
Project prloritiiation and' selection
iInportan.t; 2=Less important; 3=Important; 4=Very important; and
-'.. "5=C:rilciaI - .
Reference # 07J-2oo8-08-02-01
S.. S.... mIndian Automotive Components Sector: A Survey 37