Copyright Motorola Inc. "Quality Is Our Job, Customer ...
Upcoming SlideShare
Loading in...5
×
 

Copyright Motorola Inc. "Quality Is Our Job, Customer ...

on

  • 2,082 views

 

Statistics

Views

Total Views
2,082
Views on SlideShare
2,007
Embed Views
75

Actions

Likes
0
Downloads
96
Comments
0

3 Embeds 75

http://asqbuffalo.com 63
http://02f1699.netsolhost.com 10
http://www.slideshare.net 2

Accessibility

Categories

Upload Details

Uploaded via as Microsoft PowerPoint

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment
  • 3
  • 5
  • 6
  • 7
  • 9
  • 50
  • 10
  • 11
  • 15
  • 37
  • 16
  • 17
  • 18
  • 19
  • 29
  • 33
  • 35
  • 38
  • 41
  • 34
  • 44
  • 50
  • 50
  • 50
  • 48
  • I will now explain what we mean by Top Box Customer Satisfaction. This concept was originally presented in Harvard Business Review and somewhat forms the backbone of our overall Corporate “Brand Equity” initiative. Basically “top box” equates to achieving total customer satisfaction to the extent that your customer will definitely award your repeat business again and again. From the graph the vertical axis is loyalty ranging from low to high while horizontal axis is degree of customer satisfaction. The noncompetitive zone on the upper left is characterized by regulated monopoly or few substitutes, dominant brand equity, high cost of switching, or proprietary technology where loyalty is quite high regardless of degree of satisfaction. An example is your local telephone companies. Very few people switch local phone service regardless of quality of service We in AECS live in the highly competitive zone where there are second sources readily available. There is low cost and low impact of switching and somewhat consumer indifference.
  • 55
  • 56
  • 57
  • 58
  • 59

Copyright Motorola Inc. "Quality Is Our Job, Customer ... Copyright Motorola Inc. "Quality Is Our Job, Customer ... Presentation Transcript

  • SIX SIGMA Presented by JOHN A. LUPIENSKI
  • What We Will Cover
    • • Motorola Overview
    • Quality Journey
    • • Six Sigma The Concept
    • Deployment
    • • Results
    • • The Future
    • • Lessons Learned
    • 1997 Sales $29.8 Billion (42% / 58%)
    • 24th in Fortune 500
    • 1st in Electronics Manufacturing
    • 7th in Total Exports
    • 142,000 Employees in 53 countries
    Motorola Statistics
  • By Product By Region 1997 Sales GSS 40% SPS 21% LMPS 16% Other 10% MIMS 13% Europe 19% Asia Pacific 9% 11% Japan 6% Latin America, Africa, ROW 13% China/ Hong Kong United States 42%
  • The Rules of Engagement The Past The Future Customer/Consumer Enterprise (Motorola) Business Unit/Product Product Business Unit Motorola
  • Communications Enterprise
    • Cellular Phones
    • Pagers
    • Consumer 2-Way Products
    • Accessories
    • Terrestrial Network Operators
    • Satellite Network Operators
    • Systems
    • Equipment
    • Software
    • Services
    • Applications
    • Content
    • Cellular Infrastructures
    • Satellite Infrastructures
    • Global Network Operator Solutions
    • Integrate PCS & NSS Products
    • Servers
    • S/W Applications
    • Internet Solutions
    • Data Networking
  • ACCES
    • Powertrain Controls
    • Autobody Controls
    • Sensors
    • Telematics
    • Ceramics
    • Lighting
    • Quartz Products
    • Oscillators
    • SAWs
    • Battery Products
    • Battery Chargers
    • Power Supplies
    • Flat Panel Displays
    • Embedded Systems
    • Single Board PCs
  • SPS
    • Systems Electronics
    • Transportation Technology
    • Industrial
    • Imaging
    • Displays & Modems
    • Storage
    • Entertainment
    • Consumer Media
    • Telephony
    • Messaging
    • Wireless
    • New Media
    • Modems
    • Switching
    • Networking
    • Customer Equipment
    • Base Stations
    • PC Technology
    • Key Components
    • Distribution
    • Contract Manufacture
    • Emerging Markets
  • Motorola Products
    • Cellular Telephones
    • Two Way Communications
    • Pagers
    • Semiconductors
    • Automotive Electronic Modules and Components
    • Modems and Integrated Management Systems
    • Cellular and Satellite Infrastructure Systems
  • SOUTH KOREA Global Facilities UNITED KINGDOM DENMARK GERMANY FRANCE JAPAN HONG KONG PHILIPPINES AUSTRALIA MALAYSIA ISRAEL COSTA RICA MEXICO CANADA Copenhagen Flensburg, Munich Taunusstein, Dresden Angers, Bordeaux, Toulouse Aizu Wakamatsu, Tokyo, Sendai Seoul Kowloon Manila Melbourne Adelaide Kuala Lumpur Penang, Seremban Tel Aviv Arad Guadeloupe Guadalajara Mexico City Chihuahua Brampton, North York Richmond Basingstoke, Stotfold, Swindon Easter Inch, East Kilbride Cork, Swords TAIWAN Chung-Li CHINA Tianjin INDIA Bangalore BRAZIL Sao Paulo SINGAPORE
  • Quality Journey
  • Changing Motorola's Quality Culture 1979 "Our Quality Stinks." The environment - A U.S. Centered Company - Japan Inc. Attacking - Quality Control Mindset
  • Changing Motorola's Quality Culture 1980 • Corporate Quality Officer named Business Leadership - Senior Business Leader - Change in focus 1979 • "Our Quality Stinks."
  • Changing Motorola's Quality Culture 1979 • "Our Quality Stinks." 1980 • Corporate Quality Officer named
    • 1981 • Motorola Training Center established
      • • 5 year 10X improvement goal
      • • Corporate Quality Council
      • - Senior Leaders
      • - Common culture
      • - Lead, Teach, Audit
  • CQO Quality Council • Lead • Teach • Audit • Courseware Management Board - Lead - Teach - Audit Motorola University Business Units Suppliers Education Customers Quality Reviews • Short term results QSR Process Assess The Corporate Quality Office Recommendations on vision and direction
  • Changing Motorola's Quality Culture
    • 1979 • "Our Quality Stinks."
    • 1980 • Corporate Quality Officer named
    • 1981 • Motorola Training Center established
      • • 5 year 10X improvement goal
      • • MCQC
      • • Quality System Review
      • - Common audit tool
      • - Set Standards of Excellence
      • - Process oriented
      • - Set direction, not methods
  • QSR Manual Guidelines April 1998
    • Sets a common goal of perfection
    • Drives progress to world class standards
    • Provides an awareness of quality process requirements
    • Cross-fertilization of ideas (knowledge sharing)
    • Teaching tool (auditors and auditees)
    Assessment Vehicle for Total Organization
  • Q S R H I S T O R Y 1981 • Began focus on Quality 1982 • MCQC began a process of biennial QSRs 1986 • Six Sigma Quality and Total Customer Satisfaction introduced 1987 • Software subsystem was added 1988 • QSR was established for surveying suppliers’ quality systems • ISO 9001 Mapped unto QSR 1989 • Weight of scores changed to emphasize Malcolm Baldrige criteria 1990 • MCQC approved the use of cross-functional survey teams 1991 • Internal and supplier QSRs are combined into the current QSR forms and the QSR Guidelines 1994 • Updated to include 1994 Revision of ISO 9001 • Significant revisions to Subsystem 9, System 7 1995 • Corporate Quality System Department formed 1996 • Revision 4 includes Registrar’s Certification, Subsystem 11 and QS 9000 Supplement 1997 • Revision 5 - Business Process Focus, QS 9000 approach • SEI Certification of SS 10
  • 1. Quality System Management 2. New Product / Technology / Service Development Control 3. Supplier (Internal or External) Control 4. Process Operation and Control 5. Quality Data Programs 6. Problem Solving Techniques 7. Control of Quality Measurement Equipment and Systems 8. Human Resource Involvement 9. Customer Satisfaction Assessment 10. Software Quality Assurance 11. Legal and regulatory 12. QS 9000 checklist Quality Subsystems
  • Changing Motorola's Quality Culture
    • 1979 • "Our Quality Stinks."
    • 1980 • Corporate Quality Officer named
    • 1981 • Motorola Training Center established
      • • 5 year, 10x quality improvement goal set
      • • QSR Implemented
    1985 • Communications Sector begins total defect per unit measurement July - Manufactured Products November - Sales Orders
  • A Common Metric Total defects per unit • Count Defects • Independent variable • Ownership
  • IRS - Tax Advice (phone-in) SIGMA (with ±1.5 Sigma Shift) 2 3 4 5 6 7 100K 10K 1K 100 10 1 (233 ppm) Best in Class Purchased Material Lot Reject Rate Domestic Airline Flight Fatality Rate (0.43 ppm) Payroll Processing Journal Vouchers Wire Transfers Air Line Baggage Handling Order Write-up Average Company Restaurant Bills Doctor Prescription Writing (6210 ppm) (3.4 ppm) Benchmarking (66810 ppm)
  • 1987 • Corporation adopts Six Sigma • 2 year, 10x; 4 year, 100x quality improvement; • Six Sigma by 1992 goal is set The Quality Evolution Continues!
  • The Motorola Card KEY BELIEFS – how we will always act • Constant Respect for People • Uncompromising Integrity KEY GOALS – what we must accomplish • Best in Class — People — Marketing — Technology — Product: Software, Hardware and Systems — Manufacturing — Service • Increased Global Market Share • Superior Financial Results KEY INITIATIVES – how we will do it • Six Sigma Quality • Total Cycle Time Reduction • Product, Manufacturing and Environmental Leadership • Profit Improvement • Empowerment for all, in a Participative, Cooperative and Creative Workplace OUR FUNDAMENTAL OBJECTIVE (Everyone's Overriding Responsibility Total Customer Satisfaction
  • 1987 • Corporation adopts Six Sigma • 2 year, 10x; 4 year, 100x quality improvement; Six Sigma by 1992 goal is set 1988 • Malcolm Baldrige National Quality Award • U.S. Government sponsored • Privately funded • Promote excellence in business The Quality Evolution Continues!
  • 1987 • Corporation adopts Six Sigma • 2 year, 10x; 4 year, 100x quality improvement; Six Sigma by 1992 goal is set 1988 • Malcolm Baldrige National Quality Award • Mapped ISO 9001 into QSR 1990 • TCS Team process starts Corporate wide The Quality Evolution Continues!
  • • TDU focused problem solving • QCC/PPS provided platform - QCC JUSE - PPS Government • Narrow teams vs. broader virtual - Multifunctional - Virtual : problem centered • Competition: National scoring • 1990 First Sector competition • 1991 Corporate Today: 6000 Teams - Customers & Suppliers Total Customer Satisfaction Teams
  • Management of the Quality Improvement Process 1981 – 1986 Diverse quality metrics results in different improvement goals for each operation. 1987 – 1992
    • Common quality metric results in identical improvement rate goal for all operations.
      • Manufacturing and non-manufacturing
      • Administration and operations
      • Factory and office
  • 1992 - Winner: Malaysia National Quality Award - Winner: NY State Excelsior Quality Award - 1994 - Winner: Israel National Quality Award 1996 - Winner: Singapore National Quality Award * All Patterned after MBNQA Other Quality Awards Received *
  • Six Sigma The Concept
  • • Output Variables Manage the outputs. A Traditional View Sales Growth Market Share Profitability
  • • Output Variables • Input Variables Manage the inputs; respond to the outputs. A Non-traditional View Sales Growth Market Share Profitability Customer Satisfaction Product Quality On-Time Delivery COQ Credit Terms Relationships Service Customer Training
  • The Concept of "Six Sigma" at Motorola + Different numbers of Opportunities ... Manufacturing Processes Customers or Suppliers Administrative Areas 6  = A structural approach to continuous improvement 1 - Identify the product or service you provide 2 - Identify your customers & their requirements 3 - Determine your needs & suppliers 4 - Define the process for doing work 5 - Eliminate defect sources / optimize the process 6 - Continuously improve the Sigma level ( or “ Six steps toward excellence” ) A Bit of Statistics ... -7.0 -6.0 -5.0 -4.0 -3.0 -2.0 -1.0 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 upper spec limit Lower spec limit +1.5 Sigma -1.5 Sigma 3.4 ppm or Zero
  • CENSORED Normal Distribution - Gaussian Curve Sigma =  = Deviation ( Square root of variance ) Axis graduated in Sigma 68.27 % 95.45 % 99.73 % 99.9937 % 99.999943 % 99.9999998 % result: 317300 ppm outside (deviation) 45500 ppm 2700 ppm 63 ppm 0.57 ppm 0.002 ppm between + / - 1  between + / - 2  between + / - 3  between + / - 4  between + / - 5  between + / - 6   = -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7
  • Six Sigma...And the Statistics  Reduce the variation: when  < = Design specification width / 12  Stabilize the process, without affecting the variance , to limit the maximum process shift to +/- 1.5   Under these conditions, and in the worst case, there will be no more than a 3.4 ppm defect (reject) level, with specification limits at 4.5  on one side and 7.5  on the other.   Note: One can see that the point corresponding to 6 on the graduated performance scale above is measured in ”Sigma’s” (with 6  corresponding to a 3.4 ppm defect level).  Cp > = 2 and Cpk > = 1.5  Cp > = 2 -7.0 -6.0 -5.0 -4.0 -3.0 -2.0 -1.0 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 +1.5 Sigma -1.5 Sigma 3.4 ppm or Zero Upper spec. limit Lower spec. limit
  • Six Sigma...And Capability With a maximum process shift of +/- 1.5  Cp = Design specification width 6  3  Cpk = Min. Mean - Spec Limit
  • The Opportunities... - Customers or Suppliers: One opportunity per product delivered or per component purchased. - Manufacturing process:    Opportunities at each process step) - Administrative areas: Number of opportunities for error for each activity performed
  • Some Examples of Opportunity Customer Perspective : 1 opportunity per product delivered ex. 1 regulator = 1 opportunity 1 controller = 1 opportunity Production lines : Regulator = 160 opportunities Controller = 1200 opportunities Form ( Payment, Purchase Order, .. ) : Number of fields Expedite / Delivery : 1 opportunity / packaging unit
  • A quality level of &quot; 6  &quot; corresponds to less than 3.4 defects per million Opportunities ( i.e., correct 99.99966 % of the time ) Sigma and Opportunities Number of Defects Number of Units = D.P.U D.P.U x 1000000 Number of Opportunities = D.P.M.Op. 1 Opportunity = D.P.M.Op
  • A Universal Measurement Scale ... On one condition : Calculate the defects and estimate the opportunities in the same way... 3 4 5 6 7 66810 6210 233 3.4  Sigma DPMOp
  • Measurement With SIGMA Is Simple !!! Estimate the Opportunities Follow the Indicator : Defects per million Opportunities Conversion into &quot;Sigma&quot; can be accomplished with the help of a statistical table . Count the Defects 6  = 3.4 dpmo
  • Converting Defect Levels to..... Sigma ! 175 defects are identified while producing 5000 controllers The manufacture of one controller allows for 1367 defect opportunities. D.P.Op = 0.035 / 1367 = 0.0000256 An Example : D.P.U = 175 / 5000 = 0.035 D.P.M.Op = 25.6 &quot;Sigma&quot; level : 5.55
  • Six Sigma: An Ambitious Objective? • Accurate to 99.99966 % ( less than 3.4 defects for each million opportunities ) could appear excessive....! 99.9% is already VERY GOOD ! But what could happen at a quality level of 99.9% (i.e., 1000 ppm), in our everyday lives (about 4.6  )? • 4000 wrong medical prescriptions each year • More than 3000 newborns accidentally falling from the hands of nurses or doctors each year • Two long or short landings at American airports each day • 400 letters per hour which never arrive at their destination
  • The Impact of Quality: “6 Sigma Suppliers”
    • 13 wrong drug prescriptions per year
    • 10 newborn babies dropped by doctors/nurses per year
    • Two short or long landings per year in all the airports in the U.S.
    • One lost article of mail per hour
  • Six Sigma and Continuous Improvement Supplier Customer Enter Needs Exit Product/Service Process Activity Feedback = A structured approach to continuous improvement 1 - Identify the product or service you provide 2 - Identify the customer & their requirements 3 - Determine your needs & suppliers 4 - Define the process for doing work 5 - Eliminate defect sources / optimize the process 6 - Continuously improve the Sigma level ( or ”Six steps toward excellence&quot; ) 1 2 3 4 5 6
  • Defect Reduction: “Peeling the Onion” • Action Name Date ACTION PLAN PROCEDURE CONTINUOUS IMPROVEMENT MODEL TREND CHART GOAL T I M E 100% BRAINSTORMING/ PARETO ANALYSIS/ ROOT CAUSE IDENTIFICATION RESULTS AND INSTITUTIONALIZE MEASURE ANALYZE PROBLEM SOLVE Process step 1 Process step 3 Process step 2 • • • • SUPPLIER SUPPLIER SUPPLIER CUSTOMER CUSTOMER CUSTOMER RECORD DEFECTS RECORD DEFECTS RECORD DEFECTS RECORD DEFECTS RECORD DEFECTS
  • Advantages of This Type of Approach • Have a common language • Sensitize the organization in the use of statistical tools • Develop the internal supplier/customer relationship • Benchmarking • Work on the most significant objectives • Promote working in teams T C S Culture of Excellence
  • Deployment
  • The Process for Deployment
    • Management involvement
    • Empowered teams
    • Statistical “black belts”
  • Why Have We Been Successful... The Management Process!
    • High level of management commitment and involvement.
    • Aggressive improvement goals set by Management Board and driven down through the organization.
    • Measurement of the total process from end to end.
    • Corporate-wide uniform goals and common metrics.
    • Management accountability for quality improvement.
  • DATED JAN 15, 1987 IMPROVE PRODUCT AND SERVICES QUALITY • • • •  Ten times by 1989 and at least 100 fold by 1991 Achieve SIX SIGMA CAPABILITY by 1992 With a deep sense of urgency, spread dedication to every facet of the corporation and achieve a culture of continual improvement to ASSURE TOTAL CUSTOMER SATISFACTION. There is only one ultimate goal: zero defects - in everything we do. Signed: MOTOROLA EXECUTIVE COMMITTEE Management Leadership
    • Quality improvement goals and plans integrated into business plans.
    • No formal organization changes to implement.
    • Part of everyone's job.
    • Employee empowerment and involvement.
    • Extensive education and training support.
    • Recognition and awards.
    Why We Have Been Successful... The Management Process!
  • Management of the Improvement Process
    • Corporate review of Sectors quarterly
    • Sector review of Group monthly
    • Group review of products monthly
    • Plant review of manufacturing lines weekly
    • Manufacturing line review of processes daily
    • Same measurement - same improvement goal
  • Employee Involvement Requires
    • Awareness
      • How are we doing?
      • How are the best in class doing?
    • Training
      • Tools, Methodology, Metrics
    • High expectations
      • Team goal setting
    • Communication
      • Progress and recognition
  • Empowered Teams
    • It’s a business-driven process, not a human relations program
    • It starts with senior management - can’t be delegated
    • Employees want to take ownership and become world class producers
    • You don’t need a crisis to get started
    • Empowerment affects all functions, not just factories
    • Done right, it’s an irreversible process
  • Worldwide TCS Team Count 0 2000 4000 6000 1990 1991 1992 1993 1994 1995 1996 1997
  • A Black Belt Is . . .
    • An Individual from Any Discipline with Advanced Statistical, Quality, and Interpersonal Skills
    • An Experienced and Proven Leader in the use Six Sigma Strategies and Tools
  • A Black Belt Will . . .
    • Drive the Effective Use of Statistical Methods through Leadership, Training , and Consultation
    • Identify, Develop, and Communicate New Six Sigma Strategies and Tools
    • Actively Identify and Mentor Future Black Belts
  • Use of Six Sigma Black Belts
    • Highly trained in statistical tools
    • Act as consultants / change agents
    • Recognized as skilled in an engineering discipline
    • Strong interpersonal and communication skills
    • Significant experience with demonstrated results
    • Continuous learning aptitude
  • Black Belt Training
    • Green Belt
      • Utilize Statistical & Quality Techniques
      • 2%-5% of Time (1-2 hrs/week) Consulting/Training
      • Min. 2 Projects* per Year
    • Black Belt
      • Lead use of Statistical & Quality Techniques
      • Mentor Green Belts; Communicate New Techniques
      • 5%-10% of Time (2-4 hrs/week) Consulting/Training
      • Min. 4 Projects* per Year
    • Master Black Belt
      • Mentors Green & Black Belts
      • 80%-100% of Time Consulting/Mentoring/Training
    *Projects = training classes or project consultations
  • Corporate Commitment
    • “ Motorola is committed to developing these leaders. We owe it to our customers and to our stockholders. Through IDE, we seek to identify those who have the potential to grow into agents of change. We provide these people with extensive training in statistical and interpersonal tools, and we provide skilled guidance and management support to assure that they are able to build and integrate their capabilities.
    • Once their development has achieved a level worthy of recognition, we even have a term for those exceptional individuals, whose talent, dedication, and courage enable them to accelerate our progress into and beyond the next century.
    • We call these people ‘Six Sigma Black Belts.’” Chris Galvin
  • History of Six Sigma Black Belt Program
    • 1990 - Motorola DOE Symposium Committee organized
    • 1991 - Motorola Six Sigma Research Institute established
    • 1991 - Corporate Six Sigma Black Belt Steering Committee formed
    • 1992 - Initiated an effort between Motorola, TI, IBM, Kodak and others to jointly develop the Six Sigma Black Belt Program
    • 1992 - Six Sigma Technical Institute (SSTI) developed as a required training vehicle for Black Belt candidates
    • 1992 - First Six Sigma Black Belts recognized in Asia and US
    • 1993 - First Six Sigma Black Belt symposium held
    • 1996 - SPS Six Sigma Black Belt Steering committee formed
    • 1996 - “Intro. to Black Belt Program” replaces SSTI as required course
    • 1998 - Motorola Elma leads AIEG/ACCES group wide push for Black Belts - Reintroduces program
  • Expectations of Six Sigma Black Belts
    • Problem solving leadership
    • Improvement change agents
    • Drive use of statistical methods
    • Integrate statistics into discipline area
    • Network for solution reuse
    • Mentor future Belts
    • Continue personal development
  • Barrier Breakthrough Plan Pareto, Brainstorming, C&E, BvC 8D, 7D, TCS Teams, SPC DOE, DFM, PC RenewBlack Belt Program (Internal Motorola) Black Belt Program (External Suppliers) Proliferation of Master Black Belts 1.00 10.00 100.00 J94 DPMOp 6 Sigma SIGMA J95 J96 J97 6 5.65 5.6 5.5 5.4 5.3 MY95 MY96 MY97 MY98
  • How does one become ‘Belted’
    • Phase 1: Candidate Identification and Mentor Structure
    • Identify candidate
    • Management sponsorship
    • Master Black Belt Mentor
    • Define Black Belt responsibilities
    • Phase 2: Skill Development
    • Black Belt Orientation Class
    • Personal Skill Development
    • High Impact Improvement Project
    • Phase 3: Recognition
    • Application for recognition
    • Black Belt Recognition
    • Continuous Improvement
  •  
  • Six Sigma Black Belt Mentor Structure
  • Black Belt Roadmap
    • Express interest in the program with your management's approval
    • Complete application for candidacy
    • Interview for program
    • 5-7 Black Belts in Training
    • First 4 months 50-60% during training process starting May 4th
      • See detailed Black Belt Roadmap Development Process
    • Complete Project assigned (4/year)
    • Sponsor 2 Green Belts
  • Do other companies have Six Sigma Black Belt Programs?
    • GE has very successfully instituted this program
      • 4,000 trained Black Belts by YE 1997
      • 10,000 trained Black Belts by YE 2000
      • “ You haven’t much future at GE unless they are selected to become Black Belts” - Jack Welch
    • Kodak has instituted this program
      • CEO and COO driven process
      • Training includes both written and oral exams
      • Minimum requirements: a college education, basic statistics, presentation skills, computer skills
    • Other companies include:
      • Allied Signal -Texas Instruments
      • IBM - ABB
      • Navistar - Citibank
  • Discussion
  • The Cost/Quality Relationship
    • Six Sigma has shown that the
    • Highest Quality Producer
    • is also the
    • Lowest Cost Producer
  • Results
  • And the Results? 1986 4.2  1997 5.6  ~ 16 Billion Products Manufactured
  • FINANCIAL  •  •  • QUALITY  •  •  •  •  • A decade of product quality and productivity Sales Up 5.05x $29.8 Billion in 1997 An Average Compounded Growth Rate of 16.9% per Year Profits Up 6.03x $1.18 Billion in 1997 An Average Compounded Growth Rate of 19.5% per Year Stock Up Over 7.0x An Average Compounded Growth Rate of 21.3% per Year Through Defect Elimination We have Eliminated > 99.7% of In-Process Defects The COPQ (Cost of Poor Quality) Reduced > than 84% on a Per Unit Basis Manufacturing Cost Savings Cumulative Savings over $14 Billion Employee Productivity Increased 3-Fold: A 12% Per Year Average Product Reliability MTBF • •  Increased 5 - 10 Fold 11 Year Journey • • 1987 to 1997
  • Cost of Poor Quality Elements
    • Inspection and Test
    • Rework/Repair
    • Scrap
    • Warranty
  • The Cost of Poor Quality 0 2 4 6 8 10 12 14 16 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 Percent of Sales
  • Companies Adopting the 6  Culture
    • General Electric
    • Eastman Kodak
    • Allied Signal
    • Texas Instruments
    • Citibank
    • Sony
    • ABB
    • plus 30 others who have licensed 6  training
  • The Future
  • Six Sigma Renewal
    • Six Sigma the Improvement Process
    • Drive Quality from the Customer In
    • Customer Factory and Field Returns
    • 5-Nines Reliability
  • Identify Customers by Organization by Key Contacts Hierarchy Of Customer Satisfaction Gain Customer Loyalty Innovation & Implementation Exceed Customer Expectations Meet Customer Requirements Anticipate Customer Needs Determine Customer Requirements & Expectations MISSION VISION Defensive Strategy Meet Commitments Offensive Strategy Trust
  • Top Box Products and Service Satisfaction Completely Dissatisfied Completely Satisfied Telephone Company AECS Noncompetitive Zone ACCES Highly Competitive Zone • Regulated monopoly or few substitutes • Dominant brand equity •  High cost of switching • Powerful Loyalty program • Proprietary technology • Commoditization or low differentiation • Consumer indifference • Many substitutes • Low cost of switching Loyalty High Low HARVARD BUSINESS REVIEW Nov./Dec. 1995
  • The Customer Speaks
  • LESSONS LEARNED
  • Benchmarking Tells Us
    • There are no secrets to quality.
    • There are no “Silver Bullets” or short cuts to good quality.
    • Quality doesn’t take time, it saves time.
    • It is not only free, it pays dividends.
    • Average company spends close to 25% of its revenue on waste -- non-value added.
    • Quality process applies to the administrative side of business as well.
    • Service companies are not different from manufacturing.
  • A Quality Plan’s Key Requirements
    • A methodology
    • A metric
    • Measure a complete product/service
    • Accountability
      • (Application -- The Customer View)
    • and ... Reach Out Goals!!!
  • Actions Required to Institutionalize a Quality Process
    • TOP DOWN COMMITMENT AND INVOLVEMENT
          • Set the example, be active in the audit process
    • MEASUREMENT SYSTEM TO TRACK PROGRESS
          • At both macro and micro levels
    • TOUGH GOAL SETTING (REACH OUT!!)
          • Benchmark Best-In-Class -- audit often
    • PROVIDE THE REQUIRED EDUCATION
          • The “Why” and “How To”
    • SPREAD THE SUCCESS STORIES
  • Other Lessons Learned
    • Be careful that you don’t get too focused on winning the metric game.
    • Be careful that you don’t loose sight of the customer’s priorities.
    • Be careful that you don’t become arrogant.
    • Look at the cost of defects, not just the number.
  • Quality is not an Assignable Task it must be Rooted and Institutionalized Within every Step of the “ Business Process” IT IS EVERYONE'S RESPONSIBILITY
  • Questions ?