SIX SIGMA CONCEPT

• σ : 18th Letter of Greek.

SUM OR FINAL RESULT.
• Sigma : Based on Theory of Variation.

Standard Deviation
Σ d2
• σ = N
• Possesses most of the characteristics which
an ideal measure of dispersion should have.
 σ DEVIATION
Ht (CM) M Deviation from mean Deviation squared (d2)
(163) d
160 -3 9
160 -3 9
161 -2 4
162 -1 1
163 0 0
163 0 0
163 0 0
164 +1 1
164 +1 1
170 +7 49
Σ M =1630 Σ d2 = 74
Average = Σ M/n = 1630/10 = 163 cm
Standard Deviation = σ = √ Σ d2 /n = √74/10 =
2.72cm
 34.13% 34.13%

2.14% 2.14% 0.13%

0.13% 13.06% 13.06%

-3σ -2σ -1σ Mean +1σ +2σ +3σ

68.26%
95.46%
99.73%
Mean ± 1σ includes 68.3% cases

Mean ± 2σ includes 95.4% cases

Mean ± 3σ includes 99.7% cases

ULC (M+3σ )

99.7%
MEAN (M)

0.3%, 3/1000, 3000/106

LCL (M- (3σ )

Nos.
The Six Sigma Measurement & Philosophy

SIGMA DPMO % DEFECT STANDARD

CAPABILITY FREE
±1σ 697700 68.27% Unsatisfactory

± 2σ 308700 95.45% Historical

±3σ 66870 99.73% Questionable

±4σ 6210 99.9937% High –class

± 5σ 233 99.999943% Superior
± 6σ 3.4 99.999998% World Class
22 23 24 25 26 27 28 29 30
19 20 21 22 23 24 25 26 27 28 29 30 31 32 33

Average –23 min

26 27 28 29 30

σ +1+2+3+4
 CALCULATING SIGMA
1. Unit (U) : The item being produced/served

2. Defect (D): Does not meet requirement.

3. Opportunity : (O) – A chance for a defect to
occur.

DPMO : No. of Defects

--------------------------------------- x 1,000,000.
No. of Opportunities x No. of units.
 CALCULATING SIGMA
U= 520
O = 03
D = 04
4
DPMO = ----------- x 10,00,000
3 x 520
= 2,564.1

DPMO = 2,564.1 = 4.3 σ

High Functioning Organization
Client / Customer

Process Employee

Major focus areas

•Business Process Improvement.

•Process Improvement - Process design.
 Organizations that have utilized quality principles and
methods to achieve improvement, have hold three major
focus areas.
1. Customers :
 Knowing what a customer is
 Who your customers are
 What you provide in terms of product means knowing the
customers requirements of the product/service.
2. Process Focus :
 Control on process, Otherwise will result in
 Negative profit impact or
 Service provider going out of business.
3. Employees focus :
 Principles as promoting employee involvement.
 Developing a culture of support & communication.
 Managing change in work environment.
Happier and more satisfied an employee is, the greater the customer
satisfaction.
Thus, being employee focused makes business sense.
 To become a High Functioning Or ganisation
thr o’ six sigma, an or ganisation must take an
appr oach towar ds impr ovement that companies.

Pr ofits = Customer + Pr ocess + Employee.

Pr ocess impr ovement ver sus pr ocess design.

PROCESS DESIGN IS BEST USED WHEN :

1. New Pr ocess, w hen it assist an or ganisation

to
achieve a str ate gic objective.

2. Cur r ent pr ocess is ir r epar abl y br oken.

3. W hen a pr ocess has r eached ‘entitled’.

6-Sigma is not something
else that you do ….

It is what you do.

 WHAT SIX SIGMA IS :

A measure of variation that achieves 3.4

defects per million opportunities.

A cultural value or philosophy towards

your work.

A goal.
 Six Sigma – The Competitive Edge

“….. An organization’s prosperity

depends on being able to learn at a
faster rate than its competitors, and in
transferring and applying that learning
to its operations to sustain its
competitive advantages.”
 PROCESS IMPROVEMENT

Six sigma improvement Methodology:

Define : Define the customers & their requirements of the
product/services, team charter & key process that
affects the customers.
 Measure : Identify they key measures, the date collection plan
and execute the plan for data collection.
Analyze : Analyze to determine the root cause.
Improve : Determine potential solutions.
Control : Develop, document & implement a plan to ensure that
performance improvement remains at the desired level.
The breakthrough Cookbook: Define, Measure, Analyze,
Improve, Control.
D
DMMA
A II C
C
PHASE STEPS FOUCS
Define 0 Screen Product Pr Process for CTQ Characteristics for “Y” y

Measure 1 Set Performance Metrics For y Y

2 Validate Measurement System for y Y
3 Determine Current Process capability for y y
Analyze 4 Set Performance Expectations for y Y
5 Determine Sources of Variation for y Y
6 Validate Measurement System for Vital Few Xs y
Improve 7 Prioritize Potential Causes for y X1, X2, ..Xn
8 Determine variable Relationship for Y and Vital Few Xs X1, X2, ..Xn
9 Estimate Operating Tolerances for Vital Few Xs Vital Few Xi
Control 10 Evaluate New/Improved Process Capability for y Y
11 Incorporate Process Control System for Vital Few Xs Vital Few Xi
12 Evaluate process sustainability for y Vital Few X
Document 13 Document stepwise AEC 6σ approach Vital Few Xi
Audit
14 Present to Internal Audit Staff Team Vital Few Xi
Six Sigma Pr oject Methodology-A Macr o
Per spective

Define
Define Measure
Measure Analyze
Analyze
PracticalProblem
Practical Problem StatisticalProblem
Statistical Problem

Y=f (X1, X2, X3 , … Xk)

PracticalSolution
Practical Solution StatisticalSolution
Solution
Statistical

Control
Control Improve
Improve
 6σ Helps Discover T his Relationship

Where Defects are Found

Y = f (X1, X2, X3 X4, … Xn)

|
The Factors that may be causing
What is the the Occurrence of Defects.
Relationship
 Focus Needs to Be on X’s

Y=
Y= F(x)
F(x)

To get results, should we focus our behavior on the Y or X?

∎Y ∎ X1 ….. Xn
∎ Dependent ∎ Independent
∎ Output ∎ Input-Process
∎ Effect ∎ Cause
∎ Symptom ∎ Problem
∎ Monitor ∎ Control

If we’ re so good at X’s, why do we constantly test and inspect Y?

 The Goal of Six Sigma

X fold
X fold improvement
improvement
σσ PPM
PPM
2. 308,537
4.5
3 66,807
4. 6,210 50

5. 233 1,200
6. 3.4
Process
Process DPMO
DPMO
capability
capability 75,000

Sigma is a statistical unit relating to process capability


MYTH
Applicable only to manufacturing
Only for large corporations
We are different
Expensive to deploy
Another flavor of the year
GE’s pet peeve
We’ve tired it and it doesn’t work
This is same as TQM, SQC
We have no customer complaints
The statistics is very complicated
GOT ANOTHER MYTH?
6σ MYTHS & REALITY
REALITY
Applicable to any measurable process
Is valuable to all organizations
In business, only numbers matter
Actually cannot afford to ignore
Will show results in < quarter
Right, brought in > 10 billion in < 6 years for GE
Industry has proved you wrong
TQM,SQC is a part of six sigma
Six sigma is about breakthrough process
improvement
Even mfg. Operators have implemented it.
 Six sigma Empowerment

.0 σ A lowly slug. You have no grade point.

.1 σ I will tell you what to do next.

.2 σ You will ask what to do next.
.5 σ Bring me your problems.
1σ Bring me your problems with ideas.
2σ Bring me your problems with recommendations.
3σ Bring me your problems with recommendations. If you don’t
hear from me, just proceed.
4σ Take action, but let me know what you did.
5σ Take action and let’s talk if it doesn’t work out.
6σ Take action and report as you deem necessary.
 Traditional vs. 6 σ Quality

Traditional view of quality Six sigma view of quality

(99% of good) (99.999996 % good)
2 missed landings per day at most airports I missed landings per year at most
airports
15 minutes/day unsafe drinking water I minutes/7 months unsafe drinking
water
20,000 lost pieces of mail/hour in USA 7 lost pieces of mail/hour in USA

5,000 incorrect surgical procedures/week < 2 incorrect surgical week/week

15 misspelled words/page in a book I misspelled word/in several books

 Project Start -Up

Patron

Champions

Black Belt Master B B

Green Belt

Team Members

The Team
 PROJECT START - UP

BUILDING THE TEAM :

1. CHAMPION : Process Owner.

Or
The team Sponsor i) Assist in selection of team.
ii)Creating strategic direction for team.
iii) Help in describing what a successful project will
accomplish.
iv) help in establishing general scope of project.
v) Remove obstacles.
vi) Allocate resources.
vii) Assist the team with implementing the
solutions generated.
 PROJECT START - UP

2. Team Leader : (The Black or Green Belt) :

i) Black belt : Future business leaders, 100% devoted to quality efforts, full
time team leaders.
ii) Green Belt : Part time team leaders who have full time responsibility
elsewhere.
Responsibilities : Responsible for the on going tactical
management of the team’s work.
 Coordinates and runs the meetings.
 Ensure that individual members complete established tasks & ongoing
link to the team sponsor.
A Formal contact between sponsor & leader a minimum of at lest once a week.
3. Team Consultant : The master Black Belt
 Internal quality consultant has the greatest tech skills.
 An ad-hoc member.
4. Team Members : Selected on basic of their technical expertise for the
project.
 Major responsibility centres on implementing the steps in the quality
model.
 Six Sigma is a Methodolog y

Champions
Champions 1.1.Recognize
Recognize
(Process
(Process
Owners) 2.2.Define
Define
Owners)
3.3.Measure
Measure
Black Belt
Black Belt &&
Green Belt
Green Belt 4.4.Analyze
Analyze
Champions
Champions 5.5.Improve
Improve
(Process
(Process
Owners)
Owners) 6.6.Control
Control
 Champions make this happen !

100%

Team members
Black Belt
& Key
Stakeholders

DE ME AN IM
T NE MEVL OV NI

CO DO AU

PROJECT PHASE

Involvement / Ownership By Stakeholders Is Critical to 6σ Success!

 Success Model

Structure for Success Set up for failure

Champions selected by Executive group. Champion’s volunteer or default to
Quality Function.
Executives and Champions undergo Champions only, trained.
training.

Champions select projects, which  Projects selected by Black Belts

are then vetted by Executive. and functional management.

Champions select Black Belts. ‘Best  Black Belts chosen from

of Best’ chosen. Vetted by Executive. ‘expendables’ or exclusive to
Quality function.
 Success Model

Structure for Success Set up for failure

CEO makes public statement of intend & No public statement made at top
commitment both Internally & Externally level.

CEO interviews all Black Belts. Disconnected.

Senior Financial Personnel involved  Seen as Operational program only.

in project tracking & verification

Impact is endorsed by Financial area  Impact is ignored or guessed to

suit budget preparation.
 Success Model

Structure for Success Set up for failure

Executives visit training sites to ‘be seen’ No visibility of Executive group at
and to review. this level.

Broad Deployment : No one is Narrow or ‘Trial’ Deployment only.

excused. Focus is on repaid Focus on current manufacturing
achievement of ‘critical mass’ issues only.
Black Belts are ‘Delocalized’ across  Silo’d approach.
the organization
Life Cycle : Succession planning is  Job for Life : Focus soon becomes
put into place for Black Belts. Six one of Resource Depletion !
sigma is seen as a career path.
 Success Model

Structure for Success Set up for failure

Initial role out not seen as training Single wave of theory training only.
exercise only. Focus is on successful
closure as much as learning.
Activity Based Training : Success is Theory Lectures : No gaps between
based on project status. MAIC for application.
On – site application support. Structured similar to TQC programs.
Frequent status reporting.
A culture value or philosophy towards work

Denominating to see six sigma only a Tech

Tool.
Understanding of how far you have to go
towards achieving six sigma.
HALLMARK
• A CULTURAL PHILOSOPHY OF NEVER ENDIG
DISSATISFACTION WITH CURRENT
PERFORMANCE.

•PURSUIT OF PERFECTION.
VALUE
VALUE SPENT
SPENT AND
AND RETURN
RETURN ON
ON INVESTMENT
INVESTMENT

V ∝ RI

V=( ) IR
 BEYOND SIX SIGMA

CHANGE management