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VTU Syllabus, MBA TQM, Module 8


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Six sigma

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VTU Syllabus, MBA TQM, Module 8

  1. 1. Prof Raghavendran Venugopal SIX SIGMA
  3. 3. Six Sigma relies heavily on advanced statistical methods that complement and reduce the process and product variations. It is a new way of doing business that would eliminate the existing defects efficiently and would prevent defects from occurring
  4. 4. Motorola company that invented Six Sigma. The term “Six Sigma” was coined by Bill Smith, an engineer with Motorola Late 1970s - Motorola started experimenting with problem solving through statistical analysis 1987 - Motorola officially launched it’s Six Sigma program Motorola saved more than $ 15 billion in the first 10 years of its Six Sigma effort
  5. 5. Motorola saved more than $17 billion from 1986 to 2013, reflecting hundreds of individual successes in all Motorola business areas including: • Sales and marketing • Product design • Manufacturing • Customer service • Transactional processes • Supply chain management
  6. 6.  Financial – bank of America, GE Capital,HDFC,HSBC,American Express  ITES- ICICI One source, Accenture, Satyam PO, IBM Daksh  Hospitality- ITC Hotels, GRT Hotels, Apollo Hospitals  Manufacturing- GE Plastic, Johanson and Johnson, Motorola, Nokia, Microsoft, Ford, Wipro, Nestle, Samsung, Samtle  Telecom- Bharti Cellular, Vodafone, Siemencs,Tata  IT- Wipro, Satyam,Acenture, Infosys, TCS, Birla soft
  7. 7. CONTINUE… 1. Six Sigma Champion: Champions undergo five days of training and are taught how to manage projects and act as advisors to various project teams. 2. Green Belts: They undergo two weeks of training that includes project-oriented tasks. They act as team members to the Six Sigma project team. Their cooperation and involvement is necessary for projects success. 3. Black belts: They receive four weeks of trainings and are directly involved in the implementation of Six Sigma Projects. They are the project leaders and go through in-depth training on Six Sigma approach and tools and work full time on the project. 4. Master Black Belts: These are the people who conduct Six Sigma Training and also have on the job training and experience
  8. 8. Six Sigma Methods Six Sigma Methods Service Design productio n IT Manage ment Administ ration
  9. 9. Six-Sigma Metrics  Defect – any mistake or error that is passed on to a customer  Defects per unit (DPU) = number of defects discovered  number of units produced  Defects per million opportunities (dpmo) = DPU  1,000,000  opportunities for error
  10. 10. Six-Sigma Quality  Ensuring that process variation is half the design tolerance (Cp = 2.0) while allowing the mean to shift as much as 1.5 standard deviations, resulting in at most 3.4 dpmo.
  11. 11. k-Sigma Quality Levels
  12. 12. 13 Problem Solving  Problem: any deviation between what “should be” and what “is” that is important enough to need correcting  Structured  Semistructured  Ill-structured  Problem Solving: the activity associated with changing the state of what “is” to what “should be”
  13. 13. Quality Problem Types 1. Conformance problems 2. Unstructured performance problems 3. Efficiency problems 4. Product design problems 5. Process design problems
  14. 14. Key Factors in Six Sigma Project Selection  Financial return, as measured by costs associated with quality and process performance, and impacts on revenues and market share  Impacts on customers and organizational effectiveness  Probability of success  Impact on employees  Fit to strategy and competitive advantage
  15. 15. Problem Solving Process 1. Redefining and analyzing the problem 2. Generating ideas 3. Evaluating and selecting ideas 4. Implementing ideas
  17. 17. It approach undertaken to improve existing business process CONTRL DEFINE MEASUREANALYSE IMPROVE
  18. 18. 1.Define high-level project goals and the current process. 2.Measure key aspects of the current process and collect relevant data. 3.Analyze the data to verify cause-and-effect relationships. Determine what the relationships are, and attempt to ensure that all factors have been considered. 4.Improve or optimize the process based upon data analysis using various tools 5.Control to ensure that any deviations from target are corrected before they result in defects.
  19. 19. This approach is undertaken when there is a need to create new design or product: DEFINE MEASURE ANALYZE DESIGN VERIFY
  20. 20.  Define design goals that are consistent with customer demands and the enterprise strategy.  Measure and identify CTQs (characteristics that are Critical To Quality), product capabilities, production process capability, and risks.  Analyze to develop and design alternatives, create a high-level design and evaluate design capability to select the best design.  Design details, optimize the design, and plan for design verification. This phase may require simulations.  Verify the design, set up pilot runs, implement the production process and hand it over to the process owners. DMADV is also known as DFSS, an abbreviation of "Design For Six Sigma
  21. 21. DMAIC DMADV  Defines a business process.  Measuring current process  Identify root cause of the recurring PROBLEMS  Improvements made to reduce defects  Keep check on future performance  Define customer needs  Measure customer needs & specification  Analyze options to meet customer satisfaction.  Model is deigned to meet customer needs  Model put through simulation tests for verification
  22. 22. SIGMA LEVEL DEFECT RATE YIELD 1 691,500 dpmo 30.85% 2 308,770 dpmo 69.10000% 3 66,811 dpmo 99.33000% 4 6,210 dpmo 99.38000% 5 233 dpmo 99.97700% 6 3.44 dpmo 99.99966%
  23. 23. 24 BENEFITS OF SIX SIGMA  Generates sustained success  Sets performance goal for everyone  Enhances value for customers  Accelerates rate of improvement  Promotes learning across boundaries  Executes strategic change
  24. 24. 25 USAGE OF SIX SIGMA
  25. 25. 26 SIX SIGMA MANAGEMENT When practiced as a management system, Six Sigma is a high performance system for executing business strategy. Six Sigma is a top down solution to help organizations:  Align their business strategy to critical improvement efforts  Mobilize teams to attack high impact projects  Accelerate improved business results  Govern efforts to ensure improvements are sustained
  26. 26. 27 KEY ROLES FOR SIX SIGMA Six Sigma identifies several key roles for its successful implementation:  Executive leadership  Champions  Master Black Belts (Identify projects& functions)  Black Belts (Identify non value added activities)  Green Belts ( works on small projects ) Top Bottom
  27. 27. 28 TOOLS & TECHNIQUES  7QC tools Check Sheets (collect data to make improvements) Pareto Charts( define problem and frequency) Cause and effect diagram (Identify possible causes to solve problem) Histogram (Bar charts of accumulated data to evaluate distribution of data) Scatter diagram (plots many data points and pattern between two variables) Flow Chart (Identify unwanted steps) Control charts (Control limits around mean value)
  28. 28. 29 TRAININGS & CERTIFICATIONS If you want to make yourself more valuable and attractive to employers then get training and certification  Option I – Certification as Six Sigma Green Belt  Option II – Certification as Six Sigma Black Belt
  29. 29. Six Sigma & TQM TQM Six Sigma  focus is general improvement by approaching the problem collaboratively and culturally  utilizes the efforts of many departments, it is more of a statistical approach, and is very much data driven. It makes use of measuring and analyzing data to determine how defects and differences could be minimized to the level where there are 3.4 defects per million cycles/products, while a process is being run
  30. 30. Six Sigma & TQM TQM Six Sigma  strives for increased levels of performance.  the definition of quality is the level at which a product/process meets the set company standards.  TQM doesn’t require full- time dedication in supporting the quality management process,  Six Sigma focuses on setting minimum standards and acceptance requirements.  the definition is a relational one, stressing that quality is reflected in the least number of defects, which must, as much as possible, be eliminated.  Six Sigma approach requires certified professionals in Six Sigma techniques.
  31. 31. By Prof. Raghavendran Venugopal Module 8 Completed