By Chuck Ellison Boise State University What Exactly is Six Si!a" #istory Six Sigma is a term that comes from the feld of Statistics. The history of the statistical term dates back to the 1800s (Carl Frederick Gass!" #hile Six Sigma as a measre of $rodct %ariatio& dates back to the 1'(0s ()alter She#hart!. )ith a myriad of measreme&t sta&dards a%ailable" the term *Six Sigma+ #as coi&ed i& the 1'80s by a ,otorola e&gi&eer &amed -ill Smith. ,otorola #as seeki&g a &e# #ay of measri&g $rodct %ariatio& a&d de%elo$ed the methodology a&d associated cltre cha&ge. Six Sigma has de%elo$ed i&to &ot o&ly a .ality measreme&t tool bt also a #hole &e# #ay of doi&g bsi&ess. Six Sigma targets three mai& areas/ im$ro%i&g cstomer satisfactio&" redci&g cycle time a&d redci&g defects. Six Sigma is di0ere&t from 1ality 2rograms of the $ast i& three ma3or #ays/ 1. Six Sigma is cstomer4focsed. 5ts a& obsessio& to kee$ the cstomers &eeds i& focs a&d i& to$ $riority. 2. Six Sigma $ro3ects $rodce ma3or retr&s o& i&%estme&t. G6s C67" 8ack )elch" #rote i& the a&&al re$ort that i& 3st three years" Six Sigma had sa%ed the com$a&y more tha& 9( billio&. 3. Six Sigma cha&ges ho# ma&ageme&t o$erates. -y im$leme&ti&g Six Sigma" leaders of the orga&i:atio& begi& lear&i&g &e# tools a&d &e# a$$roaches to thi&ki&g a&d execti&g to achie%e reslts. The Statistics Behind Six Si!a ; brief discssio& of the statistics behi&d Six Sigma #ill hel$ s &dersta&d #hy it is sch a& e0ecti%e measreme&t tool a&d #hat it mea&s to the bottom li&e (i.e. $roft!. Sigma (! is a symbol mea&i&g ho# mch de%iatio& exists i& a set of data. 5f yo look at Figre 1" yo #ill recog&i:e it as #hat is sometimes called a *bell cr%e.+ 5& statistics" this is called a sta&dard &ormal distribtio&" bt the idea is the same. 5& a bell cr%e" <0= of the %ales lie abo%e the mea& (a%erage! a&d <0= of the %ales lie belo# the mea&. 5& Statistics #e take it a ste$ frther a&d deli&eate certai& data $oi&ts #ithi& that timeli&e. >ets se the exam$le of a sa&d#ich sho$. ?o ha%e a l&chtime s$ecial #here yo #ill deli%er the sa&d#iches bet#ee& 11/@<am a&d 1(/1<$m" gara&teed. 5f yo do&t meet that #i&do#" yo o#e the cstomer a <0= disco&t o& their &ext order" so yo are moti%ated to deli%er #ithi& that timeframe. ;&ythi&g otside this A04mi&te #i&do# #e #ill co&sider a *defect+ becase it does&t meet or deli%ery gara&tee. 5& Figre 1" #e ha%e i&clded all the deli%eries for the $ast mo&th a&d marked o0 or goal time $eriod. The cr%e sho#s s ho# ma&y deli%eries are #ithi& that goal a&d ho# ma&y fall otside the goal time. Figre 1 11/@<am (;%g.! 1(/1<$m 1(/@<$m
From the feld of statistics" #e k&o# that B8= of the data falls #ithi& the area of 41 a&d C1 o& either side of the mea&. The area bet#ee& the red li&es i& fgre ( i&dicates CD4 1" or B8= of the data. So if yo deli%er yor sa&d#iches o& time B8= of the time" yo cold call yorself a 1 sa&d#ich sho$. Figre ( -$ %$ -& %& Co&ti&i&g o&" if yo deli%er yor sa&d#iches o& time '<= of the time yo are at a ( sigma le%el. So&ds $retty goodE Fo# abot o&4time deli%eries of ''.GA=E Thats o&ly o$erati&g at a A sigma le%el. Ho&t thi&k yo ca& get mch betterE 5& order to be at a six sigma le%el yo #old ha%e to deli%er o& time ''.'''G= of the time. So that mea&s for e%ery millio& deli%eries made" yo #old o&ly be late ( or A times. )hat a& o$eratio&I Figre A So yo ca& see at a& o$erati&g le%el of o&e millio& o$$ort&ities" if yo #ere o&ly o$erati&g at a (4sigma le%el (most com$a&ies do o$erate bet#ee& ( a&d A sigmaI!" yo #old still ha%e a$$roximately @<"<00 defectsI 5magi&e if yo #ere a credit card com$a&y se&di&g o&e millio& bills each mo&th a&d @<"<00 #ere late each mo&thI ?o ca& see the im$act that Six Sigma ca& ha%e o& the bottom li&e of yor com$a&yI Six Si!a A'ects Manae!ent Six Sigma makes a di0ere&ce i& yor orga&i:atio& becase it i&%ol%es a commitme&t from all le%els of the orga&i:atio&. 5ts &ot 3st ma&ageme&ts b::#ordDim$ro%eme&t $ro3ect d 3orJ it is a $rocess that re.ires e%eryo&e to do their $art to achie%e Six Sigma .ality. 7fte& the ideas" soltio&s" $rocess disco%eries" a&d im$ro%eme&ts that arise from Six Sigma ha$$e& o& the fro&t li&es of the orga&i:atio&. 5t is this commitme&t to the cstomer that makes Six Sigma a sccess. 5t e&sres that e%eryo&e from the C67" to ,r. Smith" the assembly li&e #orker" has a %ested i&terest i& the com$a&ys sccess. Stayi&g focsed o& the cstomer is &ot o&ly a good thi&g to do" bt kee$i&g cstomers ha$$y is also $roftable for the bsi&ess. 8st a sim$le <= i&crease i& cstomer rete&tio& ca& i&crease $rofts more tha& (<=. 5ts estimated that com$a&ies lose 1<= to (0= of re%e&es each year de to i&e0icie&t or i&e0ecti%e $rocesses. Six Sigma allo#s ma&ageme&t to set attai&able short4term goals #hile mai&tai&i&g the ability to achie%e lo&g4term goals. Si!a (evel )ercent *efects +er Million ,++ortunities B ''.''''''8 .00( < ''.''''@A .<G @ ''.''AG BA A ''.GA (G00 ( '<.@< @<"<00 1 B8.(G A1G"A00 5m$leme&ti&g Six Sigma is do&e throgh a %ery exte&si%e trai&i&g $rogram. 2eo$le trai&ed i& Six Sigma are called *-lack -elts.+ Those #ho ha%e demo&strated a high commitme&t to the $rogram a&d begi& to me&tor others are called *,aster -lack -elts.+ The trai&i&g is deli%ered to e%ery em$loyee a&d im$acts the e&tire orga&i:atio&. There are six themes of Six Sigma/ 1. -enuine .ocus on the Custo!er/ ,o&me&tal im$ro%eme&ts ca& be made by sim$ly &dersta&di&g yor cstomer. Six Sigma im$ro%eme&ts are measred by cstomer satisfactio& a&d %ale. (. *ata- and .act-*riven Manae!ent/ Six Sigma clarifes key metrics that gage bsi&ess $erforma&ce sccess. The& $roblems ca& be e0ecti%ely def&ed" a&aly:ed a&d resol%ed" $erma&e&tly. A. )rocesses Are Where the Action 0s/ Six Sigma focses o& the $rocess rather tha& the e&d reslt. -y a&aly:i&g a&d fxi&g the $rocess itself" it e&ables a mch higher .ality rate. The most $o#erfl $art of Six Sigma is/ by masteri&g the $rocess" com$a&ies are able to bild com$etiti%e ad%a&tage i& deli%eri&g %ale to cstomers. @. )roactive Manae!ent/ -ei&g $roacti%e is the o$$osite of bei&g reacti%e. 5&stead of reacti&g to cha&ge" ma&ageme&t shifts to bei&g $roacti%e by def&i&g ambitios goals a&d re%ie#i&g them fre.e&tly" setti&g clear $riorities" focsi&g o& $roblem $re%e&tio& rather tha& *$tti&g ot fres"+ a&d .estio&i&g #hy #e do thi&gs i&stead of doi&g them becase *thats the #ay #e%e al#ays do&e it.+ <. Boundaryless Colla1oration/ ; term coi&ed by G6s C67 8ack )elch. ;ll $arts of the orga&i:atio& i&cldi&g %e&dors a&d $art&ers &eed to kee$ their focs o& the cstomer i& mi&d. 5f e%eryo&e #orks to#ards the same goal" the bo&daries #ill disa$$ear. 7rga&i:atio&al leaders &eed to #ork to break do#& the barriers a&d im$ro%e team#ork bet#ee& all $arts of the orga&i:atio& ($" do#& a&d across!. B. Strive for )erfection2 Tolerate .ailure3 Kothi&g &e# e%er comes #ithot risk. 5f $eo$le are afraid of the co&se.e&ces of mistakes" the& theyll &e%er try. Tolerate failre by lear&i&g from those mistakes a&d co&ti&e yor goal to#ards $erfectio&. #o4 is Six Si!a Bein Used" Success Stories There are a &mber of sccess stories i& the bsi&ess. )ell look at three large com$a&ies #ho &dertook Six Sigma .ality/ Ge&eral 6lectric" ,otorola" a&d 6astma& Lodak. ;&y time yo hear abot Six Sigma" yore likely to hear abot Ge&eral 6lectric. G6s C67 8ack )elch describes Six Sigma as *the most challe&gi&g a&d $ote&tially re#ardi&g i&itiati%e #e ha%e e%er &dertake& at Ge&eral 6lectric.+ ;& exam$le of Six Sigma be&efts #as gi%e& i& their 1''G ;&&al Me$ort. 5t stated that the ,edical Systems Hi%isio& re$orted a te&4fold i&crease i& the life of CT sca&&er N4May tbes" i&creasi&g the *$time+ for these machi&es. ;t G6" Six Sigma trai&i&g has i&fected all $arts of the orga&i:atio& a&d has become a $rere.isite for $romotio& i& all ma&agerial a&d execti%e $ositio&s. ; .ote from 8ack )elch" C67 says it all/ *Six Sigma has cha&ged the HK; of G64 it is &o# the #ay #e #ork4 i& e%erythi&g #e do" a&d i& e%ery $rodct #e desig&.+ ?ore also likely to hear abot sccess #ith Six Sigma at ,otorola. ;fter all" it #as -ill Smith" a ,otorola e&gi&eer" #ho crafted the statistics a&d formlas that #ere the begi&&i&g of &othi&g short of a re%oltio&. 5& fact" the mo%eme&t to#ards Six Sigma i& all i&dstries has bee& loosely dbbed *The Seco&d 5&dstrial Me%oltio&.+ ,otorola la&ched its Six Sigma 1ality 2rogram o& 8a&ary 1<" 1'8G. The com$a&y set a f%e4year goal to reach Six Sigma a&d by ,arch" 1'88" Six Sigma Trai&i&g #as taki&g $lace a&d teams #ere starti&g im$ro%eme&t $ro3ects. ; .ote from -ill )igge&hor&" Sr. Oice 2reside&t of ,otorola Trai&i&g a&d 6dcatio&/ *The la&gage of .ality became the commo& ,otorola la&gage. )hether it #as Fre&ch" ;rabic or Texa&" e%eryo&e &derstood the six ste$s" defect measreme&t a&d elimi&atio& a&d $arts $er millio&.+ 6astma& Lodak bega& their Six Sigma .ality i&itiati%e i& the 1''0s" alo&g #ith Texas 5&strme&ts" Higital 6.i$me&t Cor$oratio&" a&d 5-,. Lodak re$orted that they sa%ed o%er 9100 millio& #ith the im$leme&tatio& of Six Sigma a&d other .ality im$ro%eme&t $rograms. Lodak lists f%e factors that ha%e bee& critical to the sccess of their Six Sigma trai&i&g i&itiati%e/ ,a&ageme&t s$$ort 1ality of the #ork e&%iro&me&t 1ality of the Six Sigma ca&didates (em$loyees trai&ed i& Six Sigma! Co&siste&cy across all .ality $rograms 60ecti%e&ess of the $rogram i&strctors. Where Can 0 .ind ,ut More A1out Six Si!a" There are a &mber of resorces a%ailable that ha%e excelle&t i&formatio& o& the $rocess a&d trai&i&g i&%ol%ed #ith Six Sigma. >isted belo# are 3st a fe#/ ###.isixsigma.com is a resorce for com$a&ies i&terested i& the im$leme&tatio& of Six Sigma. 5t co&tai&s all of the i&formatio& yo &eed to k&o#. ###.ge.comDsixsigmaD details G6s %ie#s o& Six Sigma. ###.iss$.com is a &atio&al orga&i:atio& dedicated to Six Sigma >eadershi$. ,a&agi&g Six Sigma/ ; 2ractical Gide to P&dersta&di&g" ;ssessi&g a&d 5m$leme&ti&g the Strategy That ?ields -ottom >i&e Sccess by Forrest ). -reyfogle 555" 8ames ,. C$ello" a&d -ecki ,eado#s (8oh& )iley a&d So&s" (001! )hat is Six SigmaE -y 2ete 2a&de a&d >arry Fol$$ (,cGra# Fill" (00(!. ; great begi&&ers (layma&s terms! gide to Six Sigma. ;chie%e >asti&g 2rocess 5m$ro%eme&t/ Meach Six Sigma Goals )ithot the 2ai&" by -e&&et 2. >ie&t: a&d Lathry& 2. Mea (;cademic 2ress" (00(! Good lck i& yor im$leme&tatio& of Six SigmaI Youll miss 100% of the shots you never take. -Wayne Gretzky (The Great ne!