Six Sigma

SIX SIGMA
A PRODUCTION AND OPERATIONS MANAGEMENT PROJECT
By Arushi Sharma (50240) | Ashrrut Kaim (50243)
Divik Girdhar (50256) | Hisham Ahmed Rizvi (50269)
BBS II-B

Contents
• Six Sigma : An Overview
• What is Six Sigma?
• Why Six Sigma?
• Six Sigma Phases : Define, Measure,
Analyze, Improve and Control
• Tools and Key Roles for Six Sigma
Arushi Sharma | Ashrrut Kaim | Divik Girdhar | Hisham Ahmed Rizvi | BBS II-B

What is Sigma?
A term used in statistics to
represent standard
deviation, an indicator of
the degree of variation in
a set of a process.

What is Six Sigma?
Six Sigma is the measure of quality that strives for
near perfection. It is a disciplined, data-driven
methodology focused on eliminating defects. A
Six Sigma defect is defined as anything that falls
outside of a customer's specifications. Six Sigma
is a reference to a statistical measuring system,
equivalent to just 3.4 defects per every million
opportunities.
Source: Snee, 2003

What is Six Sigma?
• A statistical concept that measures a process
in terms of defects – at the six sigma level,
there 3.4 defects per million opportunities.
• A philosophy and a goal : as perfect as
practically possible
• A methodology and a symbol of quality

Sigma Levels
Sigma Level
(Process
Capability)
Defects per Million
Opportunities
2 308,537
3 66,807
4 6,210
5 233
6 3.4
Six Sigma =
99.9997%

Sigma Level
Why not four Sigma or 99.379% ?
•Every hour the postal service would lose 20,000
pieces of mail
•Every day our drinking water would be unsafe
for almost 15 minutes
•Every week there would be 5,000 surgical
operations that go wrong in some way
•Every month we would be without electricity for
almost seven hours

Why Six Sigma?

Why Six Sigma?
• At General Motors, Six Sigma
added more than $ 12 billion to
the bottom line in 1999 alone.
• Motorola saved more than $ 15
billion in the first 10 years of its Six
Sigma effort.

Why Six Sigma?
Six Sigma is about practices that
help you eliminate defects and
always deliver products and
services that meet customer
specifications

Cost of Poor Quality
• What is cost of scrap?
• What is cost of rework?
• What is cost of excessive cycle times and
delays?
• What is cost of business lost because
customers are dissatisfied with your products
or services?
• What is cost of opportunities lost because
you didn’t have time or the resources to take
advantage of them?

Critical-to-Quality (CTQ)
Elements of a process that significantly
affect the output of that process.
Identifying these elements is figuring out
how to make improvements that can
dramatically reduce costs and enhance
quality.

SIX SIGMA
PHASES
DMAIC Approach

Six Sigma Phases

Define
• Define Customers and Requirements (CTQs)
• Develop Problem Statement, Goals and
Benefits
• Identify Champion, Process Owner and Team
• Define Resources
• Evaluate Key Organizational Support
• Develop Project Plan and Milestones
• Develop High Level Process Map

Measure
• Define Defect, Opportunity, Unit and Metrics
• Detailed Process Map of Appropriate Areas
• Develop Data Collection Plan
• Validate the Measurement System
• Collect the Data
• Begin Developing Y=f(x) Relationship
• Determine Process Capability and Sigma
Baseline

Analyze
• Define Performance Objectives
• Identify Value/Non-Value Added Process
Steps
• Identify Sources of Variation
• Determine Root Cause(s)
• Determine Vital Few x's, Y=f(x) Relationship

Improve
• Perform Design of Experiments
• Develop Potential Solutions
• Define Operating Tolerances of Potential
System
• Assess Failure Modes of Potential Solutions
• Validate Potential Improvement by Pilot
Studies
• Correct/Re-Evaluate Potential Solution

Control
• Define and Validate Monitoring and Control
System
• Develop Standards and Procedures
• Implement Statistical Process Control
• Determine Process Capability
• Develop Transfer Plan, Handoff to Process
Owner
• Verify Benefits, Cost Savings/Avoidance, Profit
Growth
• Close Project, Finalize Documentation
• Communicate to Business, Celebrate

21
Define Measure Analyze Improve Control
Deliverables :
• Fully trained team is formed,
supported, and committed to work on
improvement project.
• Team charter developed, customers
identified and high impact
characteristics (CTQs) defined,
business process mapped.

22
Checkpoints for Readiness
Team Readiness :
• Team is sponsored by a champion or business leader.
• Team formed and team leaders assigned.
• Improvement team members fully trained on Six Sigma and
DMAIC.
Team Charter :
• Completed project management charter, including business
case, problem and goal statements, project scope, milestones,
roles and responsibilities, communication plan.

23
Customers
• Customer(s) identified and segmented according to their
different needs and requirements.
• Data collected and displayed to better understand customer(s)
critical needs and requirements.
Business Process Mapping
• Completed, verified, and validated high-level 'as is' (not 'should
be' or 'could be') business process map.
• Completed SIPOC representation, describing the Suppliers,
Inputs, Process, Outputs, and Customers.

24
Deliverables :
• Key measures identified, data
collection planned and executed,
process variation displayed and
communicated, performance
baselined, sigma level calculated.

25
Key Measures Identified
• Key measures identified and agreed upon.
• High impact defects defined and identified in the business
process.
Data Collection Planned and Executed
• Solid data collection plan established that includes
measurement systems analysis.
• Data collected on key measures that were identified.

26
Process Variation Displayed/Communicated
• Process variation components
displayed/communicated using suitable charts, graphs,
plots.
• Long term and short term variability accounted for.
Performance Baseline/Sigma Calculation
• Measure baseline process performance (capability,
yield, sigma level).

27
Deliverables :
• Data and process analysis, root
cause analysis, quantifying the
gap/opportunity.

28
Data and Process Analysis
• Identify gaps between current performance and the goal
performance.
Root Cause Analysis
• Generate list of possible causes (sources of variation).
• Segment and stratify possible causes (sources of variation).
• Prioritize list of 'vital few' causes (key sources of variation).
• Verify and quantify the root causes of variation.

29
Quantifying the Gap/Opportunity
• Determine the performance gap.
• Display and communicate the gap/opportunity in
financial terms.

30
Deliverables :
• Generate (and test) possible solutions,
select the best solutions, design
implementation plan.

31
Generating (and Testing) Possible Solutions
• Possible solutions generated and tested.

32
Selecting The Best Solution(s)
• Optimal solution selected based on testing and analysis.
• New and improved process ('should be') maps developed.
• Cost/benefit analysis of optimal solution(s).
• Small-scale pilot for proposed improvement(s).
• Pilot data collected and analyzed.
• Improved process ('should be') maps modified based on pilot
data and analysis.
• Project impact on utilizing the best solution(s).

33
Designing Implementation Plan
• Solution implementation plan established,
including schedule/work breakdown structure,
resources, risk management plan, cost/budget,
and control plan.
• Contingency plan established.

34
Deliverables :
• Documented and implemented
monitoring plan, standardized process,
documented procedures, response plan
established and deployed, transfer of
ownership (project closure).

35
Monitoring Plan
• Control plan in place for sustaining improvements (short and
long-term).
Process Standardization
• New process steps, standards, and documentation are
ingrained into normal operations.
Documented Procedures
• Operating procedures are consistent.
• Knowledge gained on process is shared and institutionalized.

36
Response Plan
• Response plans established, understood, and deployed.
Transfer of Ownership (Project Closure)
• Transfer ownership and knowledge to process owner and
process team tasked with the responsibilities.

Roles and Responsibilities :
Organizational Hierarchy
• Six Sigma projects are run by "black belts"
employees who have been trained in the
philosophy and its application.
• Black belts are backed up by "champions".
They are usually senior management-level
employees.

• Master Black Belt refers to the people who
mentor or coach the black belts who work
on a variety of projects

• Green Belt is a title for someone who is
involved with a Six Sigma project "part-time".
That is, they have a job with normal duties
and serves as team member or a part time
Six Sigma team leader.

Benefits of Six Sigma
1. Places a clear focus on achieving measurable and
quantifiable financial returns to the bottom-line of
an organisation.
2. Places an unprecedented importance on strong
and passionate leadership and the support required
for its successful deployment.
3. Integrates the human elements (culture change,
customer focus, belt system infrastructure, etc.) and
process elements (process management, statistical
analysis of process data, measurement system
analysis, etc.) of improvement.

Benefits of Six Sigma
4. Creates an infrastructure of Champions, Master
Black Belts (MBBs), Black Belts (BBs) and Green Belts
(GBs) that lead, deploy and implement the
approach.
5. Six Sigma emphasises the importance of data and
decision making based on facts and data rather
than assumptions and hunches!
6. Six Sigma utilises the concept of statistical thinking
and encourages the application of well-proven
statistical tools and techniques for defect
reduction through process variability reduction
methods (e.g.: statistical process control and
design of experiments).

Limitations of Six Sigma
1. The right selection and prioritisation of projects is
one of the critical success factors of a Six Sigma
program.
2. Subjectivity in the classifying what qualifies as a
‘defect’.
3. Six Sigma can easily digress into a bureaucratic
exercise if the focus is on such things as the number
of trained Black Belts and Green Belts, number of
projects completed, etc.
4. There is an overselling of Six Sigma by too many
consulting firms. Many of them claim expertise in Six
Sigma when they barely understand the tools and
techniques and the Six Sigma roadmap.

Six Sigma –
Success Stories
• General Electric has reported more than $12 billion
in savings due to Six Sigma.
• Motorola reported a saving of $15 million in over 11
years (Foster, 2007).
• Wipro maturity with six sigma resulted into:
 30-40% lower total cost of ownership
 20-30% higher productivity
 On-time deliveries (93% projects completed on
time)
 Lower field defect rates (67% lower than industry
average).

Background
• Wipro Limited was established in 1945 and commenced its
operations in 1946 as a vegetable oil company. In the early
1980s, Wipro diversified into the Information Technology sector.
• Today, Wipro Technologies has become a global service
provider.
• Integrating Six Sigma concepts was also intended to bring rigor in
effective upstream processes of the software development life
cycle. Implementation of Six Sigma methodologies brought in
quantitative understanding, cost savings, and performance
improvement towards product quality.

• Some of the key challenges involved were:
• Reduce the data transfer time
• Reduce the risk
• Avoid interruption due to LAN/WAN downtime.
• Parallel availability of the switch for the other administrative
tasks during the same period.

Evolution of Six Sigma
at Wipro
• Wipro is the first Indian company to adopt Six Sigma. Today,
Wipro has one of the most mature Six Sigma programs in the
industry ensuring that 91% of the projects are completed on
schedule, mush above the industry average of 55%.
• As the pioneers of Six Sigma in India, Wipro has already put
around ten years into process improvement through Six Sigma.
Along the way, it has scaled Six Sigma ladder, while helping to
roll out over 1000 projects.
• It is an umbrella initiative covering all business units and divisions
so that it could transform itself in a world class organization. At
Wipro, it means:

 Have products and services meet global benchmarks
 Ensure robust processes within the organization
 Consistently meet and exceed customer expectations
 Make Quality a culture within.

Difficulties Encountered &
Lessons Learnt
• Building the Culture
• Project selection
• Training
• Resources
• Project Reviews

Implementation of
Six Sigma at Wipro
Wipro has adopted the project approach for Six Sigma.

•For developing new processes:
• DSSS+ Methodology – for software development.
• DSSP Methodology – used for designing new processes and
products
• DCAM Methodology – used for designing for customer
satisfaction and manufacturability
•For Improving Existing Processes
• TQSS Methodology –used for defect reduction in
Transactional processes.
• DMAIC Methodology -used for process improvement in
Non-transactional process
•For Reengineering
• CFPM Methodology - used for cross functional Process
mapping.

Implementation of
Six Sigma at Wipro
Six Sigma projects at Wipro are:
• Driven by business heads, also called Champions for the
projects.
• Led by Green Belts (GB)
• Assisted by Black Belts (BB)

The Management of the project at Wipro follows the following
tools for implementation of Six Sigma:
• Ideation
• Definition
• Selection
• Tracking
• Reporting
Currently 15000+ employees are trained in Six Sigma
methodologies. Wipro has also built up a Six Sigma skill
base of over 180 certified black belts while helping to roll
out over a 1000 projects.

Reaping the Benefits
The financial gain that Wipro has achieved by using Six Sigma
has been one of the high points. As the Six Sigma initiative
started maturing Wipro identified two major phenomenon's:
•The biggest projects had all been completed
•The Yellow-belt culture had cured little problems before they
became big ones.

Objective of Six Sigma Implementation at Wipro has
continuously been on integrating and implementing
approaches through a simultaneous focus on defect
reduction, timeliness, and productivity.
This has translated to lower maintenance costs, schedule-
overrun costs, and development costs for customers. Towards
this, Six Sigma concepts have played an important role in:

•Improving performance
•Improving the effectiveness in upstream processes of the
software development life cycle.
•Waste elimination and increased productivity up to 35%.
•Cost of failure avoidance.
•Tangible cost savings due to lower application development
cost for customer.

The results of achieving Six Sigma are rapid and overwhelming
at Wipro.
Its unique methodology provides Six Sigma knowledge and
skills to the client, enabling the client to create ownership,
generate results and sustain success.
The maturity of Wipro’s quality processes takes the benefits to
another level, ensuring that the customers benefit from:
•30-40% lower total cost of ownership
•20-30% higher productivity
•On-time deliveries (93% projects completed on time)
•Lower field defect rates (67% lower than industry average).
The performance enhancement enabled the client to have
an improved product with the overriding benefit that the end
customer perception of the quality of the client’s product is
improved.

Conclusion
• A gauge of quality and efficiency, Six Sigma is also a
measure of excellence. Embarking on a Six Sigma
program means delivering top-quality service and
products while virtually eliminating all internal
inefficiencies (Dedhia, 2005).
• A true Six Sigma organization produces not only
excellent product but also maintains highly efficient
production and administrative systems that work
effectively with the company's other service
processes (Lucas, 2002).
• The primary factor in the successful implementation
of a six sigma project is to have the necessary
resources, the support and leadership of top
management.

Six Sigma

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