"This is not the program of the month. This is a discipline. This will be forever.

" ~ Jack Welch

Introduction to

Six Sigma

Presented by: Doing it for 1st time delighting and Pleasing customer 52.Veeresh, 16. Kailash & 36. Priyank

OUTLINE OF OUR PRESENTATION

Introduction of SIX SIGMA. Understanding SIX SIGMA. SIX SIGMA Team. Methodology. SIX SIGMA at GE. SIX SIGMA a proven method. Conclusion

SIGMA is the eighteenth letter of the Greek Alphabet used in statistics to

represent standard deviation, an indicator of the degree of variation in a set of a process.

( xi x ) 2 n 1

A highly disciplined process that helps us focus on developing and delivering near-perfect products and services.

Business Definition Business improvement approach focusing on improvement and attainment of quality level of producing not more than 3.4 ppm defects. Technical Definition A statistical term signifying 3.4 defects per million opportunities.

Sigma

Percent Defective

Defects Per Million

CAPABILITY

6
5

0.00034%
0.023%

3.4
233

World class
World class

0.62%

6210

Industry Average
Industry Average Non Competitive Non Competitive

3 2

6.7% 31%

66810 308538

69%

691462

Statistical Process Control

INSPECTION

Quality Manageme nt System TAGUCHI DOE (Robust Design)

1930

1940

1950

1960

1975

1985 1990

1995 2000

PROCESS

Y
? LSL USL

N1 C N2 FEEDBACK

DATA

In 1986, Bill Smith, a senior engineer and scientist at Motorola, introduced the concept of Six Sigma to standardize the way defects are counted. Six Sigma provided Motorola the key to addressing quality concerns throughout the organization, from manufacturing to support functions. The application of Six Sigma also contributed to Motorola winning the Malcolm Baldrige National Quality award in 1988. Since then, the impact of the Six Sigma process on improving business performance has been dramatic and well documented by other leading global organizations, such as General Electric, Allied Signal, and Citibank. Today, Motorola continues to implement Six Sigma throughout its own enterprise, and extends the benefit of its Six Sigma expertise to other organizations worldwide through Motorola University.

TQM Based on worker empowerment and teams. Department or workplace focus. Simple improvement tools. Little financial accountability.

SIX SIGMA Owned by business Leaders and Champions. Rigorous and advanced statistical tools. Requires verifiable return on investment.

Improved quality. Save time, material, wasteful effort. Cuts costs. Higher customer satisfaction. EMPLOYED IN o Design. o Production. o Service. o Inventory management. o Delivery-Supply chain management.

6 v/s 3

DMAIC

PPM %

% PPM USL

3
LSL

High Cpk

LOW Cpk

LSL Not Capable process

USL

Capable process

TOP MANAGEMENT PROGRAM CHAMPIONS Mentors or

Leaders they arrange support, find resource and remove barriers.

MASTER BLACK BELTS Trains Black belt. BLACK BELTS Lead 6 Projects full time. GREEN BELTS Assist black belts, they
understand lot of statistics, utilize statistical I/Q, quality technique.

BELTS

TASK

TIME ON CONSULTING/ TRAINING 2%-5%

MENTORING

RELATED PROJECTS 2/Year

GREEN BELT

Utilize statistical IQ Quality techniques Lead use of technique communicate new ones Consulting/ Mentoring/ Training

Find one new green belt

BLACK BELT

5%-10%

Two green belts

4/Year

MASTER BLACK BELT

80%-100%

Five Black Belts

10/Year

Six Sigma has TWO key methodologies: DMAIC is used to improve an existing business process or product. 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.

DMAIC (Define, Measure, Analyze, Improve and Control):

1. Define issues, goals, deliverable to customers. 2. Measure current process, performance, Cpk, DPMO. 3. Analyze root cause analysis by C&D, FMEA etc 4. Improve Remove defects-- DOE 5. Control Control Performance factors, get the optimal proces ---SPC control charts, performance management

TOOL

Fishbone (Ishikawa)
Measurement System Evaluation Pareto Chart Process Capability Process Costing tools X X

X
X X X X X

Process Maps
Critical business issue Requirement Analysis Run Chart Scatter Diagram X X

X X

Sigma Calculator
SIPOC Chart Story Board SWOT Analysis Team Charter Thought Process MAP Multivoting X X X

X
X

X
X

Basic methodology consists of the following five phases DMADV (Define, Measure, Analyze, Design, and Verify):

Define - formally define the goals of the design activity that are consistent with customer demands and enterprise strategy. Measure - identify CTQs (Critical to Quality), product capabilities, production process capability, risk assessment, etc. Analyze - develop design alternatives, create high-level design and evaluate design capability to select the best design. Design - develop detail design, optimize design, and plan for design verification. This phase may require simulations. Verify - verify design, setup pilot runs, implement production process and handover to process owners. This phase may also require simulations.

The groundwork for the implementation of six sigma at GE had begun in 1988 in the form of an initiative known as the Work Out program. Jack Welch, Chief executive officer of GE has set a company-wide goal to have all processes reach six sigma quality by the year 2000. Welch and GE realised that attaining Six Sigma quality will require retraining their entire workforce to think and act like Engineers- an enormous feat with remarkable benefits.

Before Six Sigma GE operations were carried out between 3-4 Sigma. The company realised that employees were an important source of intellectual power for new and creative ideas. The program had set 4 Major GOALS :
Build trust Empower employees Eliminate unnecessary work Create a new Paradigm for GE.

Results achieved over the first 2 years (1996-1998)

Revenues have risen to $100 Billion, up 11%.

Earnings have increased to $9.3 Billion, up 13%.

Earnings per Share have grown to $2.80, up 14%.

Operating margin has risen to a record 16.7%.

Working capital turns have risen sharply to 9.2%, up from 1997s record.

Customer Fulfillment Project

A- Identify Customer & Project CTQ: Customer- Material & Mfg. Present Status- 85% on Time Delivery Voice of Customer- Material should be on time/ As per Plan CTQ- On time Delivery - > 95 % Business Benefit- No Line Stoppage / ensure dispatch on time.

Customer Fulfillment Project

B Develop Team Charter:
Problem : Poor Fulfillment Score ( Preset Score 85 % On time) Goal Achieve - 95 % On time Delivery Score Business Case- 200 K $ saving because of No Line Stop .

Project Scope Improvement in the Delivery of Product-A Supplier .

SIX SIGMA TEAM Business Owner /Champion ABC

Team
ABC-1, DMAIC ABC-2 ABC-3 Project Mile Stone

Customer Fulfillment Project

C Define Process Map
Process Map Customer Input -------- Production Plan -- Material Procurement Plan ---PO to Supplier -- Supplier acknowledgement / commitment - Supplier Delivery --I/C Entry -----I/C Inspection - Stocking -- Issuance of part on line

Firm Schedule ( No Change)

FG at Supplier end

Customer Requirements Delivery Rating >95% 8H H H M M No Line stopage 10 H M H M M L 162 102 162 54 54 10

RM stocking at GE

High=9 Medium=3 Low=1

PO on Time

Fore Caste

Lead Time

264 280

Measure :
CTQ : 95 % on time Delivery

MSA Actual Data- 59 % 0n time

Fish Bone Diagram

Frequent change in Forecast Late shipment by Supplier

Late Delivery

Late GRN

No firm Schedule

PO not on time

Analyze:

Data is not normal, P = 0.000 Z score 0.22 CPK- 0.40 PPK 0.31 PPM 412397

A disciplined application of statistical problem solving tools. Identifies and helps quantify waste. Indicates steps for improvement. Savings are possible because most processes have high variation in their output, often unacceptable to customers Most companies operate at 4 sigma level moving towards 5 33 sigma.

If a company is really interested in IMPROVING then SIX SIGMA is the best way of doing unlike any other PHILOSOPHY. It cant be done in a day, its a gradual process moving towards perfection. Remove the barrier from your mind that it is only for Manufacturing sector, it has wide scope in each and every field. Remember ultimate aim of SIX SIGMA is Bottom Line i.e. SHOW ME THE MONEY ? QUALITY PRODUCTIVITY COST PROFITABILITY CUSTOMER SATISFACTION

IF PERFECTION IS TAKEN FROM ANY THING PERFECT, WHAT REMAINS IS STILL PERFECT.