Chapter 4 Six Sigma for Process and Quality Improvement


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Chapter 4 Six Sigma for Process and Quality Improvement

  1. 1. Chapter 4 Six Sigma for Process and Quality Improvement
  2. 2. Quality Management and Six Sigma in Perspective <ul><li>Two primary sets of costs are involved in quality: </li></ul><ul><ul><li>control costs </li></ul></ul><ul><ul><li>failure costs </li></ul></ul><ul><li>Costs broken into four categories: </li></ul><ul><ul><li>Prevention costs </li></ul></ul><ul><ul><li>Appraisal costs </li></ul></ul><ul><ul><li>Internal costs of defects </li></ul></ul><ul><ul><li>External costs of defects </li></ul></ul>
  3. 3. Japanese Approaches to Quality <ul><li>In 1950 the Japanese government invited W. Edwards Deming (then a professor at New York University) to give a series of lectures on quality control to help Japanese engineers reindustrialize the country. </li></ul>
  4. 4. W. Edwards Deming <ul><li>Major source of poor quality is variation </li></ul><ul><li>Quality improvement the responsibility of top management </li></ul><ul><li>All employees should be trained in use of problem solving tools and especially statistical techniques </li></ul>
  5. 5. Deming’s 14 Points <ul><li>1. Create constancy of purpose </li></ul><ul><li>2. Adopt the new philosophy </li></ul><ul><li>3. Cease dependence on mass inspection </li></ul><ul><li>4. End practice of awarding business on basis of price tags </li></ul><ul><li>5. Improve constantly and forever </li></ul><ul><li>6. Institute modern methods of training </li></ul>
  6. 6. Deming’s 14 Points continued <ul><li>7. Institute modern method of supervision </li></ul><ul><li>8. Drive out fear </li></ul><ul><li>9. Breakdown organizational barriers </li></ul><ul><li>10. Eliminate arbitrary numerical goals </li></ul><ul><li>11. Eliminate work standards and quotas </li></ul><ul><li>12. Remove barriers that reduce pride of workmanship </li></ul>
  7. 7. Deming’s 14 Points continued <ul><li>13. Institute a vigorous program of education and training </li></ul><ul><li>14. Push the 13 points everyday </li></ul>
  8. 8. Total Quality Management (TQM) <ul><li>Better to produce item right the first time than to try to inspect quality in </li></ul><ul><li>Quality at the source - responsibility shifted from quality control department to workers </li></ul>
  9. 9. History of TQM <ul><li>Dr. Shewart began using statistical control at the Bell Institute in 1930s </li></ul><ul><li>Military standards developed in 1950s </li></ul><ul><li>After World War II, Japanese Union of Scientist and Engineers began consulting with Deming </li></ul><ul><li>Deming Prize introduced in Japan in 1951 </li></ul>
  10. 10. History of TQM continued <ul><li>Quality assurance concept proposed in 1952 </li></ul><ul><li>Juran makes first trip to Japan in 1954 </li></ul><ul><li>Quality becomes Japan’s national slogan in 1956 </li></ul><ul><li>First quality circles created in 1957 </li></ul><ul><li>10,000 quality circles by 1966 </li></ul><ul><li>100,000 quality circles by 1977 </li></ul><ul><li>First U.S. quality circle 1974 </li></ul>
  11. 11. Five Steps in TQM <ul><li>Determine what customers want </li></ul><ul><li>Develop products and services </li></ul><ul><li>Develop production system </li></ul><ul><li>Monitor the system </li></ul><ul><li>Include customers and suppliers </li></ul>
  12. 12. Joseph Juran <ul><li>Quality Control Handbook (1951) </li></ul><ul><li>Employees speak in different languages </li></ul><ul><li>Quality Trilogy </li></ul><ul><ul><li>Quality Planning </li></ul></ul><ul><ul><li>Quality Control </li></ul></ul><ul><ul><li>Quality Improvement </li></ul></ul><ul><li>Need to place more emphasis on planning and improvement </li></ul>
  13. 13. Joseph Juran continued <ul><li>Organizations progress through four phases </li></ul><ul><ul><li>Minimize prevention and appraisal costs </li></ul></ul><ul><ul><li>Appraisal costs increased </li></ul></ul><ul><ul><li>Process control introduced increasing appraisal costs but lowering internal and external failure costs </li></ul></ul><ul><ul><li>Prevention costs increased in effort to lower total quality costs </li></ul></ul>
  14. 14. A Brief History of Six Sigma <ul><li>The Six Sigma concept was developed by Bill Smith, a senior engineer at Motorola, in 1986 as a way to standardize the way defects were tallied. </li></ul><ul><li>Sigma is the Greek symbol used in statistics to refer to standard deviation which is a measure of variation. </li></ul><ul><li>Adding “six” to “sigma” combines a measure of process performance ( sigma ) with the goal of nearly perfect quality ( six ). </li></ul>
  15. 15. A Brief History of Six Sigma continued <ul><li>In the popular book The Six Sigma Way, Six Sigma is defined as: </li></ul><ul><ul><li>a comprehensive and flexible system for achieving, sustaining and maximizing business success. Six Sigma is uniquely driven by close understanding of customer needs, disciplined use of facts, data, and statistical analysis, and diligent attention to managing, improving, and reinventing business processes. (p. xi) </li></ul></ul>
  16. 16. The DMAIC Improvement Process <ul><li>Six Sigma projects generally follow a well defined process consisting of five phases. </li></ul><ul><ul><li>d efine </li></ul></ul><ul><ul><li>m easure </li></ul></ul><ul><ul><li>a nalyze </li></ul></ul><ul><ul><li>i mprove </li></ul></ul><ul><ul><li>c ontrol </li></ul></ul><ul><ul><li>pronounced dey-MAY-ihk </li></ul></ul>
  17. 17. The DMAIC Improvement Process
  18. 19. The Define Phase <ul><li>The define phase of a DMAIC project focuses on clearly specifying the problem or opportunity, what the goals are for the process improvement project, and what the scope of the project is. Identifying who the customer is and their requirements is also critical given that the overarching goal for all Six Sigma projects is improving the organization’s ability to meet the needs of its customers. </li></ul>
  19. 20. Defining and Measuring Quality <ul><li>Conformance to specifications </li></ul><ul><li>Performance </li></ul><ul><li>Quick response </li></ul><ul><li>Quick-change expertise </li></ul><ul><li>Features </li></ul><ul><li>Reliability </li></ul><ul><li>Durability </li></ul><ul><li>Serviceability </li></ul><ul><li>Aesthetics </li></ul><ul><li>Perceived quality </li></ul><ul><li>Humanity </li></ul><ul><li>Value </li></ul>
  20. 21. Benchmarking <ul><li>Benchmarking involves comparing an organization's processes with the best practices to be found. Benchmarking is used for a variety of purposes, including: </li></ul><ul><ul><li>Comparing an organization's processes with the best organization's processes. </li></ul></ul><ul><ul><li>Comparing an organization's products and services with those of other organizations. </li></ul></ul>
  21. 22. Benchmarking continued <ul><li>Identifying the best practices to implement. </li></ul><ul><li>Projecting trends in order to be able to respond proactively to future challenges and opportunities. </li></ul>
  22. 23. Quality Function Deployment (QFD) <ul><li>Two key drivers of an organization’s long-term competitive success are the extent to which its new products or services meet customers’ needs, and having the organizational capabilities to develop and deliver such new products and services. </li></ul><ul><li>Tools for helping translate customer desires directly into product service attributes. </li></ul>
  23. 24. Four Houses of Quality <ul><li>Customer requirements </li></ul><ul><li>Technical requirements </li></ul><ul><li>Component requirements </li></ul><ul><li>Process deployment requirements </li></ul>
  24. 25. House of Quality Details
  25. 26. The Measure Phase <ul><li>The measure phase begins with the identification of the key process performance metrics. </li></ul><ul><li>Once the key process performance metrics have been specified, related process and customer data is collected. </li></ul><ul><li>Two commonly used process performance measures, namely, Defects per Million Opportunities (DPMO) and Process Sigma. </li></ul>
  26. 27. Defects Per Million Opportunities <ul><li>Earlier it was noted that a literal interpretation of Six Sigma is 3.4 defects per million opportunities (DPMO). This may have caused some confusion for more statistically inclined readers, which we shall now attempt to reconcile. </li></ul>
  27. 28. Defects Per Million Opportunities
  28. 29. Process Sigma <ul><li>How sigma itself can be used to measure the performance of a process. </li></ul><ul><ul><li>One way to measure the performance of a process is to calculate the number of standard deviations the customer requirements are from the process mean or target value. </li></ul></ul>
  29. 30. DPMO for Alternative Process Sigma Levels
  30. 31. Motorola’s Assumption the Process Mean Can Shift by as Much as 1.5 Standard Deviations
  31. 32. Comparison of 3 Sigma Process and 6 Sigma Process
  32. 33. The Analyze Phase <ul><li>In this phase our objective is to utilize the data that has been collected to develop and test theories related to the root causes of existing gaps between the process’ current performance and its desired performance. </li></ul><ul><li>See next slide Table 4.3 Common tools and methodologies in the Six Sigma toolset. </li></ul>
  33. 34. Brainstorming <ul><li>The brainstorming approach: </li></ul><ul><ul><li>Do not criticize ideas during the brainstorming session. </li></ul></ul><ul><ul><li>Express all ideas no matter how radical, bizarre, unconventional, ridiculous, or impractical they may seem. </li></ul></ul><ul><ul><li>Generate as many ideas as possible. </li></ul></ul><ul><ul><li>Combine, extend, and/or improve on one another’s ideas. </li></ul></ul>
  34. 35. Brainstorming: Actions to Enhance Team Creativity <ul><li>Create diversified teams. </li></ul><ul><li>Use analogical reasoning. </li></ul><ul><li>Use brain writing. </li></ul><ul><li>Use the Nominal Group Technique. </li></ul><ul><li>Record team ideas. </li></ul><ul><li>Use trained facilitators to run the brainstorming session. </li></ul><ul><li>Set high standards. </li></ul><ul><li>Change the composition of the team. </li></ul><ul><li>Use electronic brainstorming. </li></ul><ul><li>Make the workplace a playground. </li></ul>
  35. 36. Cause and Effect Diagrams
  36. 37. Process Capability Analysis
  37. 38. Process Capability Analysis continued
  38. 39. The Improve Phase: Design of Experiments (DOE) <ul><li>OFAT and 1FAT - one factor at a time. </li></ul><ul><ul><li>Shortcomings </li></ul></ul><ul><ul><ul><li>Not typically possible to test one factor at a time and hold all the other factors constant. </li></ul></ul></ul><ul><ul><ul><li>Not possible to account for interactions or joint variation between variables (Figure 4.16). </li></ul></ul></ul>
  39. 40. Design of Experiments (DOE)
  40. 41. DOE: continued
  41. 42. DOE: continued
  42. 43. DOE continued <ul><li>Some of the major considerations associated with DOE include: </li></ul><ul><ul><li>Determining which factors to include in the experiment. </li></ul></ul><ul><ul><li>Specifying the levels for each factor. </li></ul></ul><ul><ul><li>Determining how much data to collect. </li></ul></ul><ul><ul><li>Determining the type of experimental design. </li></ul></ul>
  43. 44. Taguchi Methods <ul><li>Design for Manufacturability (DFM) </li></ul><ul><li>Procedure for statistical testing to determine best combination of product and transformation system design that will make output relatively independent of normal fluctuations in the production system </li></ul>
  44. 45. Statistical Quality Control
  45. 46. Chance Versus Assignable Variation <ul><li>Chance variation is variability built into the system. </li></ul><ul><li>Assignable variation occurs because some element of the system or some operating condition is out of control. </li></ul><ul><li>Quality control seeks to identify when assignable variation is present so that corrective action can be taken. </li></ul>
  46. 47. Control Based on Attributes and Variables <ul><li>Inspection for Variables: measuring a variable that can be scaled such as weight, length, temperature, and diameter. </li></ul><ul><li>Inspection of Attributes: determining the existence of a characteristic such as acceptable-defective, timely-late, and right-wrong. </li></ul>
  47. 48. Control Charts
  48. 49. Control Charts <ul><li>Developed in 1920s to distinguish between chance variation in a system and variation caused by the system’s being out of control - assignable variation. </li></ul>
  49. 50. Control Charts continued <ul><li>Repetitive operation will not produce exactly the same outputs. </li></ul><ul><li>Pattern of variability often described by normal distribution. </li></ul><ul><li>Random samples that fully represent the population being checked are taken. </li></ul><ul><li>Sample data plotted on control charts to determine if the process is still under control. </li></ul>
  50. 51. Control Chart with Limits Set at Three Standard Deviations
  51. 52. Control Charts for Variables
  52. 53. Two Control Charts <ul><li>Sample Means Chart </li></ul><ul><li>Range Chart </li></ul>
  53. 54. Sample Data of Weights of Tacos (Ounces)
  54. 55. Analysis of Scenario 1 Sample means show problem having increased from 5 ounces to 8 ounces. Sample ranges have not changed from sample to sample.
  55. 56. Analysis of Scenario 2 Sample ranges show problem having increased from 2 ounces to 6 ounces. Sample means have not changed from sample to sample.
  56. 57. Patterns of Change in Process Distributions
  57. 58. Control Limits Sample Means Chart: Range Chart:
  58. 59. Calculating the Grand Mean and the Average Range
  59. 60. Mean Age of Ice Cream
  60. 61. Range in Ice Cream Age
  61. 62. Control Charts for Attributes
  62. 63. Fraction-Defective ( p ) Charts
  63. 64. Number-of-Defects ( c ) Charts
  64. 65. Six Sigma in Practice <ul><li>Six Sigma Roles : </li></ul><ul><ul><li>Master Black Belts. </li></ul></ul><ul><ul><li>Black Belts. </li></ul></ul><ul><ul><li>Green Belts. </li></ul></ul><ul><ul><li>Yellow Belts. </li></ul></ul><ul><li>Supporting Roles: </li></ul><ul><ul><li>Champions/Sponsors. </li></ul></ul><ul><ul><li>Process owners. </li></ul></ul>
  65. 66. Quality in Services <ul><li>Measuring is difficult </li></ul><ul><li>Training in standard procedures often used to improve quality </li></ul><ul><li>One way to measure quality of services is to use customer satisfaction surveys </li></ul><ul><li>J.D. Power and Associates uses surveys to rate domestic airlines, hotel chains, and rental car companies. </li></ul>
  66. 67. Rating the Performance of Domestic Airlines <ul><li>On-time performance (25%) </li></ul><ul><li>Airport check-in (11%) </li></ul><ul><li>Courtesy of flight attendants (11%) </li></ul><ul><li>Seating comfort (11%) </li></ul>
  67. 68. Service Defections <ul><li>Organizations should monitor customer defections </li></ul><ul><ul><li>feedback from defecting customers can be used to identify problem areas </li></ul></ul><ul><ul><li>can determine what is needed to win them back </li></ul></ul><ul><ul><li>changes in defection rate can be used as early warning signal </li></ul></ul>
  68. 69. Quality Awards/Certifications
  69. 70. The Malcolm Baldrige National Quality Award
  70. 71. ISO 9000 <ul><li>Guidelines for designing, manufacturing, selling, and servicing products. </li></ul><ul><li>Selecting an ISO 9000 certified supplier provides some assurance that supplier follows accepted business practices in areas covered by the standard </li></ul>
  71. 72. Elements of ISO 9000 <ul><li>Management Responsibility </li></ul><ul><li>Quality System </li></ul><ul><li>Contract Review </li></ul><ul><li>Design Control </li></ul><ul><li>Document and Data Control </li></ul><ul><li>Purchasing </li></ul><ul><li>Control of Customer Supplied Product </li></ul><ul><li>Product Identification and Traceability </li></ul><ul><li>Process Control </li></ul><ul><li>Inspection and Testing </li></ul><ul><li>Control of Inspection, Measuring, and Test Equipment </li></ul><ul><li>Inspection and Test Status </li></ul><ul><li>Control of Nonconforming Product </li></ul><ul><li>Corrective and Preventive Action </li></ul><ul><li>Handling, Storage, Packaging, Preservation, and Delivery </li></ul><ul><li>Internal Quality Audits </li></ul><ul><li>Training </li></ul><ul><li>Servicing </li></ul><ul><li>Statistical Techniques </li></ul>
  72. 74. ISO 14000 <ul><li>Series of standards covering environmental management systems, environmental auditing, evaluation of environmental performance, environmental labeling, and life-cycle assessment. </li></ul><ul><li>Intent is to help organizations improve their environmental performance through documentation control, operational control, control of records, training, statistical techniques, and corrective and preventive actions. </li></ul>
  73. 76. Copyright <ul><li>Copyright  John Wiley & Sons, Inc. All rights reserved. Reproduction or translation of this work beyond that named in Section 117 of the United States Copyright Act without the express written consent of the copyright owner is unlawful. Requests for further information should be addressed to the Permissions Department, John Wiley & Sons, Inc. Adopters of the textbook are granted permission to make back-up copies for their own use only, to make copies for distribution to students of the course the textbook is used in, and to modify this material to best suit their instructional needs. Under no circumstances can copies be made for resale. The Publisher assumes no responsibility for errors, omissions, or damages, caused by the use of these programs or from the use of the information contained herein. </li></ul>