Six sigma


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Six sigma

  1. 1.  Six sigma methodology provides the techniques and tools to improve the capability and reduces defects in any process. It was started by Motorola in 1987, in its manufacturing division. Six sigma strives for perfection. It allows only 3.4 defects per million opportunities. Six sigma improves the process performance, decreases variation and maintains consistent quality of the process output. This leads to defect reduction and improvements in profits and customer satisfactions. The objective of six sigma principle is to achieve zero defect products/process.
  2. 2. HISTORYMany measurement standards (Cpk,Zero defects,etc)have been developed in the area of qualityprocessing, but credit for coming up with the term “sixsigma” was given to a Motorola engineer named Billsmith.“six sigma” is currently a federally registeredtrademark of Motorola. A six sigma quality program was established atMotorola in 1987.This program was developed by Mikel J.Harry, andgained publicity when Motorola won the Malcolmbaldrige national quality award in 1988. Today many companies have adopted their own sixsigma methodologies and programs.
  3. 3.  The era „1986 to 1990‟ is referred to as the first generation of Six Sigma, or SSG 1 for short. Pioneered at Motorola Statistical approach Measured Defects Per Million Opportunities (DPMO) Focused on:  Elimination of defects  Improving product and service quality  Reducing cost  Continuous process improvement
  4. 4.  In the 1990s, the focus of Six Sigma shifted from product quality to business quality. General Electric Corp. ushered in the second generation of Six Sigma, or SSG 2 as it is known. Six Sigma became a business-centric system of management. High potential candidates were selected as Black Belts.
  5. 5.  Developed after the year 2000. Gen III can show companies how to deliver products or services that, in the eyes of customers, have real value. Combines Lean Manufacturing Techniques and Six Sigma. Termed as Lean Six Sigma. Korean steel maker Posco and electronics maker Samsung has begun a Gen III programme.
  6. 6. 99% Good (3.8 σ) 99.99966% Good (6 σ)• 20,000 lost articles of mail per • Seven articles lost per hour hour• Unsafe drinking water for almost • One unsafe minute every seven 15 minutes each day month• 5,000 incorrect surgical operation • 1.7 incorrect surgical operation per week per week• Two short or long landing at most • One short or long landing at most major airports each day major airports every 5 year• 200,000 wrong drug prescriptions • 68 wrong drug prescriptions each year each year• No electricity for almost seven • One hour no electricity for almost hours each month every 34 years 7
  7. 7. How to calculate six sigma Calculate defect per unit (DPU) Total # defects DPU = Total # of Units Calculate defect per million opportunities for error (DPMO): DPU X 1,000,000 DPMO = # of Opportunity per Units
  8. 8. Assume that the product in question is a television which contain 800 opportunities for error. Total production 2,500 units, found 450 defects. What is six sigma level? Total # of Defect 450DPU calculation = = = 0.18 Total # of Units 2,500Thus, DPU X 1,000,000 0.18 X 1,000,000DPMO = = = 225 Opportunity for Error 800 From the next table, found that sigma level : 5 < σ < 6 9
  9. 9. If your yield is: Your DPMO is: Your Sigma is: 30.9% 690,000 1.0 62.9% 308,000 2.0 93.3 66,800 3.0 99.4 6,210 4.0 99.98 320 5.0 99.9997 3.4 6.0
  10. 10. Six Sigma Support Structure Champions: Business leaders who lead the implementation of Six Sigma within the business; Master Black Belts: Fully trained quality leaders responsible for Six Sigma strategy, training, mentoring, deployment and results; Black Belts: Fully trained Six Sigma experts who lead improvement teams, work on Six Sigma projects and mentor Green belts; Green Belts: Fully trained individuals who apply Six Sigma skills to improvement projects; Team Members: (Yellow Belts) Individuals who support projects in their areas.
  11. 11.  Six Sigma has two key methodologies: DMAIC and DMADV. DMAIC is used to improve an existing business process. DMADV is used to create new product designs or process designs in such a way that it results in a more predictable, mature and defect free performance.
  12. 12. DIFF. B/W DMAIC & DMADV DMAIC DMADV Defines a business process.  Define customer needs Measuring current process  Measure customer needs & specification Identify root cause of the recurring  Analyze options to meet customer PROBLEMS satisfaction. Improvements made to reduce  Model is deigned to meet customer defects needs  Model put through simulation tests Keep check on future performance for verification
  13. 13. Six Sigma is a “Industry Independent” methodology and has been successfully applied across: Manufacturing Industry including Automotives, Aerospace, Health Equipment, FMCG, Electronic Goods, Continuous Process Industries, Textiles, etc. Service Industry including Telecom, Banking and Financial Services, Health Care, Hotels, IT, ITES, KPOs, Airlines, Cargo movement, Support Services, HR services, Marketing Services, etc. R&D organizations or in R&D functions of various organizations
  14. 14. Industry Examples of Six Sigma ApplicabilityAutomotives i. Improving Safety & Reliability of Finished Vehicles ii. Reducing Manufacturing defects at each stage iii. Using Design FMEA to understand and prevent any possible design failures iv. Improving the overall Incoming Material Quality or parts Quality v. Optimizing Inventory levels for all major parts vi. Reducing time to manufacture vii. Reducing Design defects viii. Reducing Supplier Lead time i.e the time take by each supplier to deliver goodsFew Examples of Companies: Tata Motors, Ford, GM, Maruti, Telco.
  15. 15. Industry Examples of Six Sigma ApplicabilityContinuous Process i. Improving overall Yield of each shiftPlants ii. Reduce scrap or spilled materials iii. Reduce the Process failures or breakdowns iv. Increase Plant capacity utilization v. Improve Operator Productivity vi. Reduce time to restart the process after failure vii. Create mechanisms to prevent failures at each stage viii. Improve overall process stability & controlFew Examples of Companies: Reliance Industries Ltd, Asian Paints, GEplastics, Wipro consumer goods
  16. 16. Industry Examples of Six Sigma ApplicabilityEngineering Parts i. Reduce Manufacturing cycle time (time of order to delivery)Manufacturing ii. Improve Customer Service performance scores iii. Reduce or optimize inventory levels iv. Reduce scrap or cost of poor quality v. Reduce warranty costs vi. Reduce rejections due to design errors vii. Improve parts design process to meet specifications 100% of times viii. Improve parts reliability by identifying & optimizing critical factors that ensure reliabilityFew Examples of Companies: Gates India Ltd., Medium to small scale suppliers ofparts
  17. 17. Industry Examples of Six Sigma ApplicabilityTextiles/ Fashion i. Eliminating manufacturing errors/defectshouses/ Garments ii. Improving first sample approval percentages while working with buyers iii. Improving buyer satisfaction levels iv. Increasing repeat business v. Improving supplier evaluation processes vi. Improving processes at the source (including fabric purchase and inspection, stitching, embroidery, packing and shipping) to reduce rejections at later stages. vii. Reducing costs viii. Reducing delaysFew Examples of Companies: Reliance Industries, Raymonds, Grasim
  18. 18. Six sigma-motorolaMotorola saved $17 Billion from 1986 to2004, reflecting hundreds of individualsuccesses in all Motorola business areasincluding: Sales and Marketing Product design Manufacturing Customer service Transactional processes Supply chain management
  19. 19.  Honeywell is one of the many success stories involving Six Sigma. The company employs more than108,000 people who work in 95 countries. The business is involved in products from aerospace to transportation products. In 1994, Rick Schroeder who at the time was Vice President of Operations at Allied Signal (now Honeywell) brought his Six Sigma experience from Motorola to Allied Signal. By 1999, Allied Signal was 5 years into Six Sigma program, which headed the company‟s effort to capture growth.
  20. 20.  They reduced defects and waste in all of their business processes—resulting in a $600 million annual savings. Following its merger in 1999, Allied Signal became Honeywell. Reduced time from design to certification of new projects like aircraft engines from 42 to 33 months.
  21. 21. • In 1995 GE mandated each employee to work towards achieving 6 sigma• The average process at GE was 3 sigma in 1995• In 1997 the average reached 3.5 sigma• GE’s goal was to reach 6 sigma by 2001in critical processes• From 1998 onwards GE realized benefits worth 2billion USD.• GE was the first company to Implement Six Sigma in services and also in offshoring.“the most important initiative GE hasever undertaken”. Jack Welch Chief Executive Officer General Electric
  22. 22. A Dabbawala is a person in the Indian city of Mumbai whose job is to carry and deliver freshly made food from home in lunch boxes to office workers. Dabbawalas pick up 175,000 lunches from homes and deliver to their customers everyday. Only one mistake is made in every 6 million deliveries. Accuracy Rating is 99.999999. More than Six Sigma.
  23. 23.  Helps organizations produce products and services better, faster and cheaper. Remove Wastage Maximize Customer Satisfaction Maximize Product/Service Quality. (Develop Close to Zero Defect Products/Services) Increase Sales Increase overall Organizational Productivity Save Costs reduce scarp and rework Faster Cycle Time Empower Employees