Six Sigma For Managers (Explore HR.Org)

Six Sigma forSix Sigma for
ManagersManagers
KAUSTAV LAHIRI (BENCHMARK SIX SIGMA).KAUSTAV LAHIRI (BENCHMARK SIX SIGMA).

2www.exploreHR.org
Contents :Contents :
• Six Sigma : An OverviewSix Sigma : An Overview
• What is Six Sigma?What is Six Sigma?
• Why Six Sigma?Why Six Sigma?
• Six Sigma Phases : Define, Measure, Analyze,Six Sigma Phases : Define, Measure, Analyze,
Improve and ControlImprove and Control
• Tools and Key Roles for Six SigmaTools and Key Roles for Six Sigma
If you find this presentation useful, please consider telling others
about our site (www.exploreHR.org)(www.exploreHR.org)

3www.exploreHR.org
Why Six Sigma?Why Six Sigma?

4www.exploreHR.org
What is Sigma ?What is Sigma ?
SigmaSigma
A term used in statistics to represent
standard deviation, an indicator of the
degree of variation in a set of a process

5www.exploreHR.org
What is Six Sigma?What is Six Sigma?
SixSix
SigmaSigma
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

6www.exploreHR.org
Sigma LevelSigma Level
Sigma Level
(Process
Capability)
Defects per Million
Opportunities
2 308,537
3 66,807
4 6,210
5 233
6 3.4

7www.exploreHR.org
Six Sigma =
99,9997%

8www.exploreHR.org
• 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 not Four
Sigma or
99.379% ?

9www.exploreHR.org
Money
Customer
Satisfaction
Growth
Quality
Competitive
Advantage
Employee Pride

10www.exploreHR.org
• At GE, Six Sigma added more than $ 2 billion to theAt GE, Six Sigma added more than $ 2 billion to the
bottom line in 1999 alonebottom line in 1999 alone
• Motorola saved more than $ 15 billion in the first 10Motorola saved more than $ 15 billion in the first 10
years of its Six Sigma effortyears of its Six Sigma effort
• AlliedSignal reports saving $ 1,5 billion through SixAlliedSignal reports saving $ 1,5 billion through Six
Sigma.Sigma.

11www.exploreHR.org
Six Sigma is about practices that help you
eliminate defects and always deliver
products and services that meet customer
specifications

12www.exploreHR.org
Cost of Poor QualityCost of Poor Quality
What is cost of scrap?What is cost of scrap?
What is cost of rework?What is cost of rework?
What is cost of excessive cycle times andWhat is cost of excessive cycle times and
delays?delays?

13www.exploreHR.org
Cost of Poor QualityCost of Poor Quality
What is cost of business lost becauseWhat is cost of business lost because
customers are dissatisfied with yourcustomers are dissatisfied with your
products or services?products or services?
What is cost of opportunities lost becauseWhat is cost of opportunities lost because
you didn’t have time or the resources to takeyou didn’t have time or the resources to take
advantage of them?advantage of them?

14www.exploreHR.org
Critical-to-Quality (CTQ)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.

15www.exploreHR.org
Six Sigma PhasesSix Sigma Phases

16www.exploreHR.org
Define Measure Analyze
Improve
Control
D M A I CD M A I C

17www.exploreHR.org
Define
Measure
Analyze
Define the project goals and customer
(internal and external) deliverables
Measure the process to determine current
performance
Analyze and determine the root cause(s)
of the defects

18www.exploreHR.org
Improve
Control
Control future process performance
Improve the process by eliminating defects

19www.exploreHR.org
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

20www.exploreHR.org
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

21www.exploreHR.org
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

22www.exploreHR.org
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

23www.exploreHR.org
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

24www.exploreHR.org
Define Measure Analyze Improve Control
Deliverables :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.

25www.exploreHR.org
Checkpoints for ReadinessCheckpoints for Readiness
Team 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 :Team Charter :
• Completed project management charter, including business case,
problem and goal statements, project scope, milestones, roles and
responsibilities, communication plan.

26www.exploreHR.org
CustomersCustomers
• 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 MappingBusiness 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.

27www.exploreHR.org
• Key measures identified, data collection planned and
executed, process variation displayed and communicated,
performance baselined, sigma level calculated.

28www.exploreHR.org
Key Measures IdentifiedKey Measures Identified
• Key measures identified and agreed upon.
• High impact defects defined and identified in the business process.
Data Collection Planned and ExecutedData Collection Planned and Executed
• Solid data collection plan established that includes measurement
systems analysis.
• Data collected on key measures that were identified.

29www.exploreHR.org
Process Variation Displayed/CommunicatedProcess Variation Displayed/Communicated
• Process variation components displayed/communicated using
suitable charts, graphs, plots.
• Long term and short term variability accounted for.
Performance Baseline/Sigma CalculationPerformance Baseline/Sigma Calculation
• Measure baseline process performance (capability, yield,
sigma level).

30www.exploreHR.org
• Data and process analysis, root cause analysis,
quantifying the gap/opportunity.

31www.exploreHR.org
Data and Process AnalysisData and Process Analysis
• Identify gaps between current performance and the goal
performance.
Root Cause AnalysisRoot 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.

32www.exploreHR.org
Quantifying the Gap/OpportunityQuantifying the Gap/Opportunity
• Determine the performance gap.
• Display and communicate the gap/opportunity in financial terms.

33www.exploreHR.org
• Generate (and test) possible solutions, select the best
solutions, design implementation plan.

34www.exploreHR.org
Generating (and Testing) Possible SolutionsGenerating (and Testing) Possible Solutions
• Possible solutions generated and tested.

35www.exploreHR.org
Selecting The Best Solution(s)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).

36www.exploreHR.org
Designing Implementation PlanDesigning Implementation Plan
• Solution implementation plan established, including schedule/work
breakdown structure, resources, risk management plan,
cost/budget, and control plan.
• Contingency plan established.

37www.exploreHR.org
• Documented and implemented monitoring plan,
standardized process, documented procedures, response
plan established and deployed, transfer of ownership
(project closure).

38www.exploreHR.org
Monitoring PlanMonitoring Plan
• Control plan in place for sustaining improvements (short and long-
term).
Process StandardizationProcess Standardization
• New process steps, standards, and documentation are ingrained into
normal operations.
Documented ProceduresDocumented Procedures
• Operating procedures are consistent.
• Knowledge gained on process is shared and institutionalized.

39www.exploreHR.org
Response PlanResponse Plan
• Response plans established, understood, and deployed.
Transfer of Ownership (Project Closure)Transfer of Ownership (Project Closure)
• Transfer ownership and knowledge to process owner and process
team tasked with the responsibilities.

40www.exploreHR.org
Tools and Roles forTools and Roles for
Six SigmaSix Sigma

41www.exploreHR.org
• Creating flowcharts of the step in a process
– operations, decision points, delays,
movements, handoffs, rework, loops, and
controls or inspections.
• A process map is illustrated description of
how a process work.
Tools for Six SigmaTools for Six Sigma
ProcessProcess
MappingMapping

42www.exploreHR.org
• DOE is a structured, organized method for
determining the relationship between
factors (Xs) affecting a process and the
output of that process (Y).
Design ofDesign of
ExperimentsExperiments
or DOEor DOE

43www.exploreHR.org
• A group of rows and columns, with one set
of increments marked along the X
(horizontal) axis and another set of
increments marked along the Y (vertical)
axis.
• The purpose of using XY matrix is to study
and understand the relationship between
what you are putting into a process and
what your customer is getting out of it.
• The XY matrix allows the team to identify
gaps, areas for improvement.
XY MatrixXY Matrix

44www.exploreHR.org
• The goal of this tool is to ensure that your
measurement system is statically confident
– that it’s both accurate and precise each
and every time it is used.
• Undertaken during Measure phase, your
MSA determines whether or not you can
take a certain measurement and repeat or
reproduce it among different people who
take the same measurement.
MeasurementMeasurement
SystemSystem
AnalysisAnalysis

45www.exploreHR.org
• Process capability tool is the measure of a
process being able to meet specification
requirements and fulfill customer CTQ
needs on a long term basis.
ProcessProcess
CapabilityCapability
ToolTool

46www.exploreHR.org
• Investigating a theory about the suspected
cause (s) of a particular effect in a process
to determine if it is correct.
• It’s a compass that points you directly to
the vital few factors that are most affecting
your process.
HypothesisHypothesis
TestingTesting

47www.exploreHR.org
• The manner in which a part or process can
fail to meet a specification, creating a
defect or non-conformance, and the impact
on the customer if that failure mode is not
prevented or corrected.
FailureFailure
Mode EffectMode Effect
AnalysisAnalysis

48www.exploreHR.org
• A detailed assessment and guide for
maintaining all the positive changes you,
your black belt, and the project team have
made.
• It ensures that all your analysis and efforts
stay in effect and that you have information
at your disposal to prevent backsliding or a
return to less than optimal performance
standard.
ControlControl
PlanPlan

49www.exploreHR.org
ChampionsChampions Are responsible for the Six Sigma
implementation across the organization in an
integrated manner. Champions also act as
mentor to Black Belts.
Includes CEO and other key top management
team members. They are responsible for setting
up a vision for Six Sigma implementation.
Key Roles for Six SigmaKey Roles for Six Sigma
ExecutiveExecutive
LeadershipLeadership

50www.exploreHR.org
Black BeltsBlack Belts Operate under Master Black Belts to apply Six
Sigma methodology to specific projects. They
primarily focus on Six Sigma project execution.
Identified by champions, act as in-house expert
coach for the organization on Six Sigma. They
devote 100% of their time to Six Sigma.
MasterMaster
Black BeltsBlack Belts

51www.exploreHR.org
Are the employees who take up Six Sigma
implementation along with their other job
responsibilities. They operate under the guidance
of Black Belts and support them in achieving the
overall results.
Green BeltsGreen Belts

52www.exploreHR.org
Six Sigma Do’sSix Sigma Do’s
• Do communicate the commitment company-Do communicate the commitment company-
widewide
• Do demonstrate the commitment of companyDo demonstrate the commitment of company
leadersleaders
• Do empower your key human resourcesDo empower your key human resources
• Do provide on-site mentoring for black beltsDo provide on-site mentoring for black belts

53www.exploreHR.org
Six Sigma Do’sSix Sigma Do’s
• Do be patient at the inception of you six SigmaDo be patient at the inception of you six Sigma
initiativeinitiative
• Do claim and advertise early “wins”Do claim and advertise early “wins”
• Do benchmarkDo benchmark
• Do establish project baseline and goalsDo establish project baseline and goals

54www.exploreHR.org
Recommended Further Readings:
1. Greg Brue, Six Sigma for Managers, McGraw Hill
2. George Eckes, Six Sigma for Everyone, John Wiley and Sons

55www.exploreHR.org
End of Material

Six Sigma For Managers (Explore HR.Org)

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Similar to Six Sigma For Managers (Explore HR.Org)

Similar to Six Sigma For Managers (Explore HR.Org) (20)

Recently uploaded

Recently uploaded (20)

Six Sigma For Managers (Explore HR.Org)