Sixsig

SIX SIGMA Presented by
JOHN A. LUPIENSKI
Copyright Motorola Inc. “Quality Is Our Job, Customer Satisfaction Is Our Duty, Customer Loyalty Is Our Future”
What We Will Cover
• Motorola Overview
• Quality Journey
• Six Sigma The Concept
• Deployment
• Results
• The Future
• Lessons Learned
Motorola Statistics
• 1997 Sales $29.8 Billion (42% / 58%)

• 24th in Fortune 500
• 1st in Electronics Manufacturing
• 7th in Total Exports
• 142,000 Employees in 53 countries
1997 Sales
By Product By Region
Latin America,
Other Africa, ROW
LMPS 10% 13% United
16% Japan States
GSS 6%
40% 42%
MIMS China/
13% Hong Kong
11%
Asia
Pacific
9%
SPS Europe
21% 19%
The Rules of Engagement
The Past The Future
Product Customer/Consumer
Business Unit Enterprise (Motorola)
Motorola Business Unit/Product
Communications Enterprise
THE
COMMUNICATIONS
ENTERPRISE
PERSONAL NETWORK COMMERCIAL, NETWORK GLOBAL TELECOM INTERNET AND

COMMUNICATIONS MANAGEMENT GOVERNMENT SOLUTIONS SOLUTIONS NETWORKING
SECTOR GROUP AND INDUSTRIAL SECTOR GROUP GROUP
SOLUTIONS SECTOR
 Cellular Phones  Terrestrial  Systems  Cellular  Global Network  Servers

 Pagers Network Operators  Equipment Infrastructures Operator Solutions  S/W Applications
 Consumer 2-Way  Satellite Network  Software  Satellite  Integrate PCS &  Internet Solutions
Products Operators  Services Infrastructures NSS Products  Data Networking
 Accessories  Applications
 Content
ACCES
AUTOMOTIVE.COMPONENT,
COMPUTER AND
ENERGY SECTOR
AUTOMOTIVE COMPONENT ENERGY FLAT PANEL MOTOROLA

& INDUSTRIAL PRODUCTS SYSTEMS DISPLAY COMPUTER
ELECTRONICS GROUP GROUP DIVISION GROUP
GROUP
 Powertrain Controls  Ceramics  Battery Products  Flat Panel Displays  Embedded Systems
 Autobody Controls  Lighting  Battery Chargers  Single Board PCs
 Sensors Quartz Products  Power Supplies
 Telematics  Oscillators
 SAWs
SPS
SEMICONDUCTOR
PRODUCTS
SECTOR
TRANSPORTATION CONSUMER WIRELESS NETWORK AND SEMICONDUCTOR

SYSTEMS SYSTEMS SUBSCRIBER COMPUTING COMPONENTS
GROUP GROUP SYSTEMS GROUP SYSTEMS GROUP GROUP
 Systems Electronics  Imaging  Telephony  Modems  Key Components

 Transportation  Displays & Modems  Messaging  Switching  Distribution
Technology  Storage  Wireless  Networking  Contract
 Industrial  Entertainment  New Media  Customer Equipment Manufacture

 Consumer Media  Base Stations  Emerging Markets
 PC Technology
Motorola Products
• Cellular Telephones
• Two Way Communications
• Pagers
• Semiconductors
• Automotive Electronic Modules and
Components
• Modems and Integrated Management Systems
• Cellular and Satellite Infrastructure Systems
Global Facilities
UNITED KINGDOM GERMANY

Basingstoke, Stotfold, Swindon Flensburg, Munich
Easter Inch, East Kilbride Taunusstein, Dresden
Cork, Swords DENMARK
Copenhagen FRANCE
CANADA Angers, Bordeaux,
Brampton, Toulouse
North York
CHINA
Tianjin
JAPAN
Aizu Wakamatsu,
Tokyo, Sendai
Richmond
SOUTH KOREA
TAIWAN Seoul
Chung-Li
MEXICO HONG KONG
Guadalajara Kowloon
Mexico City
Chihuahua PHILIPPINES
COSTA RICA ISRAEL SINGAPORE Manila
Tel Aviv
Guadeloupe
Arad
MALAYSIA AUSTRALIA
BRAZIL INDIA Kuala Lumpur Melbourne
Sao Paulo Bangalore Penang, Seremban Adelaide
Quality Journey
Changing Motorola's Quality Culture
1979 "Our Quality Stinks."
The environment
- A U.S. Centered Company
- Japan Inc. Attacking
- Quality Control Mindset
1979 • "Our Quality Stinks."
1980 •Corporate Quality Officer named

Business Leadership
- Senior Business Leader
- Change in focus
1980 • Corporate Quality Officer named
1981 • Motorola Training Center established

• 5 year 10X improvement goal
• Corporate Quality Council
- Senior Leaders
- Common culture
- Lead, Teach, Audit
The Corporate Quality Office
Customers Suppliers
Business Units
Assess Education
Quality Reviews
• Short term results
QSR Motorola
Process CQO University
Quality Council • Courseware
- Lead
Recommendations on
- Teach vision and direction
• Lead
- Audit
• Teach Management Board
• Audit

• 5 year 10X improvement goal
• MCQC
• Quality System Review
- Common audit tool
- Set Standards of Excellence
- Process oriented
- Set direction, not methods
QSR Manual
Guidelines
April 1998
Assessment Vehicle for Total Organization
• Sets a common goal of perfection
• Drives progress to world class standards
• Provides an awareness of quality process requirements
• Cross-fertilization of ideas (knowledge sharing)
• Teaching tool (auditors and auditees)
1981 • Began focus on Quality
1982 • MCQC began a process of biennial QSRs
Q 1986 • Six Sigma Quality and Total Customer Satisfaction introduced
S 1987 • Software subsystem was added
R 1988 • QSR was established for surveying suppliers’ quality systems

• ISO 9001 Mapped unto QSR
1989 • Weight of scores changed to emphasize Malcolm Baldrige criteria
H 1990 • MCQC approved the use of cross-functional survey teams
I 1991 • Internal and supplier QSRs are combined into the current
QSR forms and the QSR Guidelines
S 1994 • Updated to include 1994 Revision of ISO 9001
• Significant revisions to Subsystem 9, System 7
T
1995 • Corporate Quality System Department formed
O 1996 • Revision 4 includes Registrar’s Certification, Subsystem 11
R and QS 9000 Supplement
1997 • Revision 5 - Business Process Focus, QS 9000 approach

Y • SEI Certification of SS 10
Quality Subsystems
1. Quality System Management
2. New Product / Technology / Service Development Control
3. Supplier (Internal or External) Control
4. Process Operation and Control
5. Quality Data Programs
6. Problem Solving Techniques
7. Control of Quality Measurement Equipment and Systems
8. Human Resource Involvement
9. Customer Satisfaction Assessment
10. Software Quality Assurance
11. Legal and regulatory
12. QS 9000 checklist
• 5 year, 10x quality improvement goal set
• QSR Implemented
1985 • Communications Sector begins total

defect per unit measurement
July - Manufactured Products
November - Sales Orders
A Common Metric
Total defects per unit
• Count Defects
• Independent variable
• Ownership
Benchmarking
IRS - Tax Advice (phone-in)
100K
(66810 ppm)
Restaurant Bills
Doctor Prescription Writing
10K Payroll Processing
Order Write-up
Average Journal Vouchers
Company(6210 ppm) Wire Transfers
1K
Purchased Material
Lot Reject Rate Air Line Baggage
Handling
(233 ppm)
100
10
Best in Class
Domestic Airline
(3.4 ppm) Flight Fatality Rate
1
2 3 4 5 6 7
(0.43 ppm)
SIGMA (with ±1.5 Sigma Shift)
The Quality Evolution Continues!
1987 • Corporation adopts Six Sigma

• 2 year, 10x; 4 year, 100x quality improvement;
• Six Sigma by 1992 goal is set
The Motorola Card
KEY BELIEFS– how we will always act

• Constant Respect for People
• Uncompromising Integrity
KEY GOALS– what we must accomplish

• Best in Class
OUR FUNDAMENTAL OBJECTIVE —People
—Marketing
(Everyone's Overriding Responsibility —Technology
Total Customer Satisfaction —Product: Software, Hardware and
Systems
—Manufacturing
—Service
• Increased Global Market Share
• Superior Financial Results
KEY INITIATIVES– how we will do it

• Six Sigma Quality
• Total Cycle Time Reduction
• Product, Manufacturing and
Environmental
Leadership
• Profit Improvement
• Empowerment for all, in a Participative,
Cooperative and Creative Workplace
Six Sigma by 1992 goal is set
1988 • Malcolm Baldrige National Quality Award
• U.S. Government sponsored

• Privately funded
• Promote excellence in business
Six Sigma by 1992 goal is set
1988 • Malcolm Baldrige National Quality Award
• Mapped ISO 9001 into QSR
1990 • TCS Team process starts Corporate wide
Total Customer Satisfaction Teams
• TDU focused problem solving
• QCC/PPS provided platform
- QCC JUSE
- PPS Government
• Narrow teams vs. broader virtual
- Multifunctional
- Virtual : problem centered
• Competition: National scoring
• 1990 First Sector competition
• 1991 Corporate
Today: 6000 Teams - Customers & Suppliers

Management of the Quality
Improvement Process
1981 – 1986
Diverse quality metrics results in different
improvement goals for each operation.
1987 – 1992
Common quality metric results in identical
improvement rate goal for all operations.
• Manufacturing and non-manufacturing
• Administration and operations
• Factory and office
Other Quality Awards Received *
1992
- Winner: Malaysia National Quality Award
- Winner: NY State Excelsior Quality Award
-
1994
- Winner: Israel National Quality Award
1996
- Winner: Singapore National Quality Award
* All Patterned after MBNQA
Six Sigma The Concept
A Traditional View
Market Share
Sales Growth
• Output Variables
Profitability
Manage the outputs.

A Non-traditional View
Product Quality
COQ Service
• Input Variables On-Time Delivery

Relationships
Credit Terms
Customer
Training
Customer Satisfaction
Market Share
Sales Growth
• Output Variables
Profitability
Manage the inputs; respond to the outputs.

The Concept of "Six Sigma" at Motorola
A Bit of Statistics ... Different numbers of Opportunities ...
-1.5 Sigma +1.5 Sigma
Lower spec limit upper spec limit
+ Manufacturing Processes
6
3.4 ppm
or Zero
Administrative Areas
1.0
2.0
3.0
6.0
7.0
0.0
4.0
5.0
-7.0
-6.0
-5.0
-4.0
-3.0
-2.0
-1.0
Customers or Suppliers
= A structural approach to continuous improvement

( or “ Six steps toward excellence” )
1 - Identify the product or service you provide 4 - Define the process for doing work
2 - Identify your customers & their requirements 5 - Eliminate defect sources / optimize the process
3 - Determine your needs & suppliers 6 - Continuously improve the Sigma level
Normal Distribution - Gaussian Curve
2
  ( xi  x)
=
Sigma =  = Deviation n 1
( Square root of variance )
Axis graduated in Sigma

-3
-1
-7
-6
-5
-4
-2
7
1
2
3
5
6
0
4
between + / - 1 68.27 % result: 317300 ppm outside
(deviation)
between + / - 2 95.45 % 45500 ppm
between + / - 3 99.73 % 2700 ppm
between + / - 4 99.9937 % 63 ppm
between + / - 5 99.999943 % 0.57 ppm
between + / - 6 99.9999998 % 0.002 ppm
Six Sigma...And the Statistics
-1.5 Sigma +1.5 Sigma
Lower spec. limit Upper spec. limit
3.4 ppm
or Zero
3.0
-6.0
-5.0
-1.0
0.0
1.0
2.0
-7.0
-3.0
-2.0
4.0
5.0
6.0
7.0
-4.0
 Reduce the variation: when  < = Design specification width / 12 Cp > = 2
 Stabilize the process, without affecting the variance, Cp > = 2 and Cpk > = 1.5
to limit the maximum process shift to +/- 1.5
 Under these conditions, and in the worst case, there will be no more than a 3.4 ppm
defect (reject) level, with specification limits at 4.5 on one side and 7.5 on the other.
 Note: One can see that the point corresponding to 6 on the graduated performance
scale above is measured in ”Sigma’s” (with 6 corresponding to a 3.4 ppm defect level).
Six Sigma...And Capability
Design specification width

Cp =
6
Mean - Spec Limit

Cpk = Min.
3
 1 2 3 4 5 6 7 8
Cp 0.33 0.66 1 1.33 1.66 2 2.33 2.66
Cpk -0.16 0.16 0.5 0.83 1.16 1.5 1.83 2.16
With a maximum process shift of +/- 1.5 
The Opportunities...
Different Numbers of Opportunities ...
Manufacturing Process
6
Administrative Areas
Customers or Suppliers
- Customers or Suppliers: One opportunity per product delivered or

per component purchased.
- Manufacturing process:  Opportunities at each process step)
- Administrative areas: Number of opportunities for error for
each activity performed
Some Examples of Opportunity
Customer Perspective: 1 opportunity per product delivered

ex. 1 regulator = 1 opportunity
1 controller = 1 opportunity
Production lines:
Regulator = 160 opportunities
Controller = 1200 opportunities
Form( Payment, Purchase Order, .. ): Number of fields
Expedite / Delivery:
1 opportunity / packaging unit
Sigma and Opportunities
A quality level of "6" corresponds to less

than 3.4 defects per million Opportunities
( i.e., correct 99.99966 % of the time )
A Universal Measurement Scale ...
Sigma
7
6
5
4
 DPMOp
On one condition : 3
3.4
Calculate the defects and
estimate the opportunities 233
in the same way... 6210
66810
Measurement With SIGMA Is Simple !!!
Estimate the Count the

Opportunities Defects
Follow the Indicator :

Defects per million Opportunities
6 = 3.4 dpmo
Conversion into "Sigma" can

be accomplished with the help
of a statistical table.
Converting Defect Levels to..... Sigma !
An Example :
175 defects are identified while
producing 5000 controllers
D.P.U = 175 / 5000 = 0.035
The manufacture of one controller
allows for 1367 defect opportunities.
D.P.Op = 0.035 / 1367 = 0.0000256

D.P.M.Op = 25.6
"Sigma" level : 5.55
Six Sigma: An Ambitious Objective?
• Accurate to 99.99966 % ( less than 3.4 defects for each million

opportunities ) could appear excessive....!
99.9% is already VERY GOOD !
But what could happen at a quality level of 99.9% (i.e., 1000 ppm),
in our everyday lives (about 4.6)?
• 4000 wrong medical prescriptions each year
• More than 3000 newborns accidentally falling

from the hands of nurses or doctors each year
• Two long or short landings at American airports each day
• 400 letters per hour which never arrive at their destination
The Impact of Quality: “6 Sigma Suppliers”
• 13 wrong drug prescriptions per year

• 10 newborn babies dropped by doctors/nurses
per year
• Two short or long landings per year in all the
airports in the U.S.
• One lost article of mail per hour
Six Sigma and Continuous Improvement
= A structured approach to continuous improvement

( or ”Six steps toward excellence" )
1 - Identify the product or service you provide 4 - Define the process for doing work
2 - Identify the customer & their requirements 5 - Eliminate defect sources / optimize the process
3 - Determine your needs & suppliers 6 - Continuously improve the Sigma level
Feedback 6
3 2
Enter Process Exit 1
Supplier Needs Activity 5
Product/Service Customer
Defect Reduction: “Peeling the Onion”
Process Process Process

SUPPLIER • step 1 • step 2 • step 3 • CUSTOMER •
RECORD RECORD RECORD RECORD RECORD
DEFECTS DEFECTS DEFECTS DEFECTS DEFECTS
TREND CHART
PROCEDURE
GOAL
TIME
MEASURE
RESULTS AND
ANALYZE
INSTITUTIONALIZE
PROBLEM SOLVE
BRAINSTORMING/
PARETO ANALYSIS/
ACTION PLAN ROOT CAUSE
Action Name Date IDENTIFICATION
100%
CONTINUOUS IMPROVEMENT MODEL
Advantages of This Type of Approach
• Have a common language

• Sensitize the organization in the use of statistical tools
• Develop the internal supplier/customer relationship
• Benchmarking
• Work on the most significant objectives
• Promote working in teams
TCS
Culture
of
Excellen
Deployment
The Process for Deployment
• Management involvement
• Empowered teams
• Statistical “black belts”
Why Have We Been Successful...
The Management Process!
• High level of management commitment and

involvement.
• Aggressive improvement goals set by Management
Board and driven down through the organization.
• Measurement of the total process from end to end.
• Corporate-wide uniform goals and common metrics.
• Management accountability for quality
improvement.
Management Leadership
DATED JAN 15, 1987
IMPROVE PRODUCT AND SERVICES QUALITY • • • •
Ten times by 1989 and at least 100 fold by 1991
Achieve SIX SIGMA CAPABILITY by 1992

With a deep sense of urgency, spread dedication to every facet of the
corporation and achieve a culture of continual improvement to ASSURE
TOTAL CUSTOMER SATISFACTION. There is only one ultimate goal:
zero defects - in everything we do.
Signed: MOTOROLA EXECUTIVE COMMITTEE
Why We Have Been Successful...
The Management Process!
• Quality improvement goals and plans

integrated into business plans.
• No formal organization changes to implement.
• Part of everyone's job.
• Employee empowerment and involvement.
• Extensive education and training support.
• Recognition and awards.
Management of the Improvement Process
• Corporate review of Sectors quarterly

• Sector review of Group monthly
• Group review of products monthly
• Plant review of manufacturing lines weekly
• Manufacturing line review of processes daily
• Same measurement - same improvement goal
Employee Involvement Requires
• Awareness
– How are we doing?
– How are the best in class doing?
• Training
– Tools, Methodology, Metrics
• High expectations
– Team goal setting
• Communication
– Progress and recognition
Empowered Teams
• It’s a business-driven process, not a human relations

program
• It starts with senior management - can’t be delegated
• Employees want to take ownership and become world
class producers
• You don’t need a crisis to get started
• Empowerment affects all functions, not just factories
• Done right, it’s an irreversible process
Worldwide TCS Team Count
1997
1996
1995
1994
1993
1992
1991
1990
0 2000 4000 6000
A Black Belt Is . . .
 An Individual from Any Discipline with

Advanced Statistical, Quality, and
Interpersonal Skills
 An Experienced and Proven Leader in the use

Six Sigma Strategies and Tools
A Black Belt Will . . .
 Drive the Effective Use of Statistical Methods

through Leadership, Training , and
Consultation
 Identify, Develop, and Communicate New

Six Sigma Strategies and Tools
 Actively Identify and Mentor Future Black

Belts
Use of Six Sigma Black Belts
• Highly trained in statistical tools

• Act as consultants / change agents
• Recognized as skilled in an engineering discipline
• Strong interpersonal and communication skills
• Significant experience with demonstrated results
• Continuous learning aptitude
Black Belt Training
• Green Belt
– Utilize Statistical & Quality Techniques
– 2%-5% of Time (1-2 hrs/week) Consulting/Training
– Min. 2 Projects* per Year
• Black Belt
– Lead use of Statistical & Quality Techniques
– Mentor Green Belts; Communicate New Techniques
– 5%-10% of Time (2-4 hrs/week) Consulting/Training
– Min. 4 Projects* per Year
• Master Black Belt
– Mentors Green & Black Belts
– 80%-100% of Time Consulting/Mentoring/Training
*Projects = training classes or project consultations
Corporate Commitment
“Motorola is committed to developing these leaders. We owe it to our
customers and to our stockholders. Through IDE, we seek to identify
those who have the potential to grow into agents of change. We provide
these people with extensive training in statistical and interpersonal tools,
and we provide skilled guidance and management support to assure that
they are able to build and integrate their capabilities.
Once their development has achieved a level worthy of recognition,
we even have a term for those exceptional individuals, whose talent,
dedication, and courage enable them to accelerate our progress into and
beyond the next century.
We call these people ‘Six Sigma Black Belts.’”
Chris Galvin
History of Six Sigma Black Belt Program
• 1990 - Motorola DOE Symposium Committee organized
• 1991 - Motorola Six Sigma Research Institute established
• 1991 - Corporate Six Sigma Black Belt Steering Committee
formed
• 1992 - Initiated an effort between Motorola, TI, IBM, Kodak and
others to jointly develop the Six Sigma Black Belt Program
• 1992 - Six Sigma Technical Institute (SSTI) developed as a
required training vehicle for Black Belt candidates
• 1992 - First Six Sigma Black Belts recognized in Asia and US
• 1993 - First Six Sigma Black Belt symposium held
• 1996 - SPS Six Sigma Black Belt Steering committee formed
• 1996 - “Intro. to Black Belt Program” replaces SSTI as required
course
• 1998 - Motorola Elma leads AIEG/ACCES group wide push for
Black Belts - Reintroduces program
Expectations of Six Sigma Black
Belts
• Problem solving leadership
• Improvement change agents
• Drive use of statistical methods
• Integrate statistics into discipline area
• Network for solution reuse
• Mentor future Belts
• Continue personal development
Barrier Breakthrough Plan
Pareto, Brainstorming, C&E, BvC

SIGMA
100.00 8D, 7D, TCS Teams, SPC
5.3
DOE, DFM, PC
5.4
RenewBlack Belt Program (Internal Motorola) 5.5
5.6
5.65
DPMOp
Black Belt Program (External Suppliers)

10.00
Proliferation of Master Black Belts

6 Sigma
6
MY95 MY96 MY97 MY98

1.00
J94 J95 J96 J97
How does one become ‘Belted’
Phase 1: Candidate Identification and Mentor Structure
Identify candidate
Management sponsorship
Master Black Belt Mentor
Define Black Belt responsibilities
Phase 2: Skill Development
Black Belt Orientation Class
Personal Skill Development
High Impact Improvement Project
Phase 3: Recognition
Application for recognition
Black Belt Recognition
Continuous Improvement
Core Statistical Skills Core Six Sigma Quality Skills Core Interpersonal Skills
GBM Statistical Software (JMP, Minitab) GBM AIEG QMS GBM Communication (oral, written)
MIN101 AEC722, DDI121
GBM Numerical and Graphical Techniques GBM QS 9000 GBM Team Facilitation
MIN101, IBM548 AEC279 DDI170
GBM Statistical Process Control GBM Customer Satisfaction GBM Coaching and Mentoring
AEC506, AEC661, AEC662, AEC663 SSG100, TCS100 LDR380, PER119
GBM Process Capability GBM Six Steps to Six Sigma GBM Managing Change
AEC661, AEC662, SCP201 SSG100, SSG102CD MGT564, MGT124, PDE532
GBM Comparative Tests GBM Concurrent Engineering BM Leadership
MIN101, SPC201 MGT561, MGT562, DDI180
GBM Analysis of Variance (ANOVA) GBM TCS BM Team Building
ENG998, AEC603 TCS100 MGT560, MGT562, EC727, MGT155
GBM Measurement System Analysis GBM Systemic Approach to Problem M Instructional/Teaching
AEC663 Solving MOT132
QUA392
GBM Design of Experiments (e.g. Full, GBM Team Oriented Problem Solving M Managing Projects
Fractional, Taguchi Designs) (8D, 7D, 5P)
ENG998, QUA389 AEC471, MGT839
GBM Regression (e.g. linear, nonlinear) BM Quality System Review
QUA590
GBM Statistical Process Characterization BM Team Problem Solving Non-
Strategies and Techniques Manufacturing
ENG227 CES103
BM Statistical Inference BM Design for Manufacturability
MIN101, SPC201
ENG123, ENG123CD
BM Confidence Intervals BM Financial/Economic Quality Issues
MIN101, SPC201
BM Probability Concepts and M Quality Function Deployment
Distributions
SPC201 QUA200A, QUA200B, QUA200C
BM Response Surface Methods M Total Quality Management
QUA393
BM Screening DOE M Benchmarking
QUA391 BMK220
M Advanced Problem Solving M Product Development Assessment
Strategies and Technologies
ENG998
M Acceptance Sampling
SPC201
M Sample Size Estimation
M Robust Design of Processes and

Products
M Survival Analysis / Reliability
Six Sigma Black Belt Mentor
Structure
Belt Sponsorship Related Projects
Master Black Belt 5 Black Belts 10 / Year
Black Belt 2 Green Belts 4 / Year
Green Belt Find 1 new Green Belt 2 / Year
Black Belt Roadmap
• Express interest in the program with your
management's approval
• Complete application for candidacy
• Interview for program
• 5-7 Black Belts in Training
• First 4 months 50-60% during training process
starting May 4th
– See detailed Black Belt Roadmap Development Process
• Complete Project assigned (4/year)
• Sponsor 2 Green Belts
Do other companies have Six Sigma
Black Belt Programs?
• GE has very successfully instituted this program
– 4,000 trained Black Belts by YE 1997
– 10,000 trained Black Belts by YE 2000
– “You haven’t much future at GE unless they are selected to
become Black Belts” - Jack Welch
• Kodak has instituted this program
– CEO and COO driven process
– Training includes both written and oral exams
– Minimum requirements: a college education, basic statistics,
presentation skills, computer skills
• Other companies include:
– Allied Signal -Texas Instruments
– IBM - ABB
– Navistar - Citibank
Discussion
The Cost/Quality Relationship
Six Sigma has shown that the
Highest Quality Producer
is also the
Lowest Cost Producer
Results
And the Results?
1997
5.6
Products Manufactured
~ 16 Billion
1986
4.2
11 Year Journey • • 1987 to 1997
FINANCIAL QUALITY
 Sales Up 5.05x $29.8 Billion in 1997  Through Defect Elimination
• An Average Compounded Growth • We have Eliminated > 99.7% of
Rate of 16.9% per Year In-Process Defects
 Profits Up 6.03x $1.18 Billion in 1997  The COPQ (Cost of Poor Quality)
• An Average Compounded Growth • Reduced > than 84% on a Per Unit
Rate of 19.5% per Year Basis
 Stock Up Over 7.0x  Manufacturing Cost Savings
• An Average Compounded Growth • Cumulative Savings over $14 Billion
Rate of 21.3% per Year  Employee Productivity
• Increased 3-Fold: A 12% Per Year
Average
 Product Reliability
• MTBF • • Increased 5 - 10 Fold
A decade of product quality and productivity
Cost of Poor Quality Elements
• Inspection and Test
• Rework/Repair
• Scrap
• Warranty
The Cost of Poor Quality
16
14
12
Percent of Sales
10
0
1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997
Companies Adopting the 6 Culture
• General Electric
• Eastman Kodak
• Allied Signal
• Texas Instruments
• Citibank
• Sony
• ABB
• plus 30 others who have licensed 6 training
The Future
Six Sigma Renewal
• Six Sigma the Improvement Process
• Drive Quality from the Customer In
• Customer Factory and Field Returns
• 5-Nines Reliability
Hierarchy Of Customer Satisfaction
Gain
Customer
Offensive
Loyalty Trust
Strategy
Innovation &
Implementation
Anticipate
Customer Needs
Exceed
Customer Expectations
Meet
Defensive Customer Requirements Meet
Strategy Commitments
Determine Customer
Requirements & Expectations
Identify Customers
by Organization by Key Contacts
Top Box Products and Service
Noncompetitive
Zone
High Telephone Company
• Regulated monopoly or few
substitutes
Totally
• Dominant brand equity
• High cost of switching
Satisfied
• Powerful Loyalty program
Loyalty
• Proprietary technology
ACCES
Highly Competitive
Zone
Satisfied • Commoditization or
low differentiation
• Consumer indifference
• Many substitutes
• Low cost of switching
Low AECS
Completely Completely
Dissatisfied Satisfaction Satisfied
HARVARD BUSINESS REVIEW Nov./Dec. 1995
The Customer Speaks
Customer Satisfaction Customer Loyalty
79.0%
80%
100 74.0% 75.9%
90 70%
80
Percent Satisfied
60%
70 55 50%
60 38 60
40%
50
40 30%
30 20% 19.5% 18.1%

44 15.7%
20 40
30 10%
10 5.3% 6.5% 6.0%
0 0%
Would Continue to Use Would Recommend Willingness to
1995 1996 1997 Motorola in the Future Motorola to Colleagues Repurchase Products
in the Future
% Satisfied % Top Box Definitely Would Might Definitely Would Not
Performance Compared to Competitors Ease of Doing Business

57.4% 58.3% 70%
60% 63.5%
60%
50%
40.3% 50%
40% 35.9%
40%
30%
31.5%
30%
20%
20%
10% 6.7%
1.4%
10%
0% 5.0%
How we rate in Comparison How Satisfied is the Customer with
with the Best Supplier us in Comparison to the Competition 0%
Similar/Somewhat
Customer Satisfaction with the Ease of Doing Business
Much Better/ Much Worse/
Very Satisfied Satisfied Not Satisfied
Very Satisfied Somewhat Satisfied Not Satisfied
LESSONS
LEARNED
Benchmarking Tells Us
 There are no secrets to quality.
 There are no “Silver Bullets” or short cuts to
good quality.
 Quality doesn’t take time, it saves time.
 It is not only free, it pays dividends.
 Average company spends close to 25% of its
revenue on waste -- non-value added.
 Quality process applies to the administrative
side of business as well.
 Service companies are not different from
manufacturing.
A Quality Plan’s Key Requirements
 A methodology
 A metric
 Measure a complete
product/service
 Accountability
 (Application -- The Customer View)
 and ... Reach Out Goals!!!

Actions Required to
Institutionalize a Quality Process
– TOP DOWN COMMITMENT AND INVOLVEMENT
• Set the example, be active in the audit process
– MEASUREMENT SYSTEM TO TRACK PROGRESS

• At both macro and micro levels
– TOUGH GOAL SETTING (REACH OUT!!)

• Benchmark Best-In-Class -- audit often
– PROVIDE THE REQUIRED EDUCATION

• The “Why” and “How To”
– SPREAD THE SUCCESS STORIES
Other Lessons Learned
• Be careful that you don’t get too focused on

winning the metric game.
• Be careful that you don’t loose sight of the

customer’s priorities.
• Be careful that you don’t become arrogant.
• Look at the cost of defects, not just the number.
Quality
is not an Assignable Task
it must be Rooted and Institutionalized
Within every Step of the
“Business Process”
IT IS EVERYONE'S RESPONSIBILITY
Questions ?

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SIX SIGMA Presented by

• 1997 Sales $29.8 Billion (42% / 58%)

The Past The Future

Business Unit Enterprise (Motorola)

Motorola Business Unit/Product

PERSONAL NETWORK COMMERCIAL, NETWORK GLOBAL TELECOM INTERNET AND

 Cellular Phones  Terrestrial  Systems  Cellular  Global Network  Servers

Products Operators  Services Infrastructures NSS Products  Data Networking

AUTOMOTIVE COMPONENT ENERGY FLAT PANEL MOTOROLA

TRANSPORTATION CONSUMER WIRELESS NETWORK AND SEMICONDUCTOR

 Systems Electronics  Imaging  Telephony  Modems  Key Components

 Industrial  Entertainment  New Media  Customer Equipment Manufacture

UNITED KINGDOM GERMANY

1979 "Our Quality Stinks."

1979 • "Our Quality Stinks."

1980 •Corporate Quality Officer named

1981 • Motorola Training Center established

Quality Council • Courseware

1981 • Motorola Training Center established

• Sets a common goal of perfection

• Drives progress to world class standards

• Provides an awareness of quality process requirements

• Cross-fertilization of ideas (knowledge sharing)

• Teaching tool (auditors and auditees)

1982 • MCQC began a process of biennial QSRs

Q 1986 • Six Sigma Quality and Total Customer Satisfaction introduced

S 1987 • Software subsystem was added

R 1988 • QSR was established for surveying suppliers’ quality systems

1989 • Weight of scores changed to emphasize Malcolm Baldrige criteria

H 1990 • MCQC approved the use of cross-functional survey teams

1997 • Revision 5 - Business Process Focus, QS 9000 approach

2. New Product / Technology / Service Development Control

3. Supplier (Internal or External) Control

4. Process Operation and Control

5. Quality Data Programs

6. Problem Solving Techniques

7. Control of Quality Measurement Equipment and Systems

8. Human Resource Involvement

9. Customer Satisfaction Assessment

10. Software Quality Assurance

11. Legal and regulatory

12. QS 9000 checklist

1985 • Communications Sector begins total

Total defects per unit

1987 • Corporation adopts Six Sigma

KEY BELIEFS– how we will always act

KEY GOALS– what we must accomplish

KEY INITIATIVES– how we will do it

1988 • Malcolm Baldrige National Quality Award

• U.S. Government sponsored

1990 • TCS Team process starts Corporate wide

Today: 6000 Teams - Customers & Suppliers

Manage the outputs.

• Input Variables On-Time Delivery

Manage the inputs; respond to the outputs.

Lower spec limit upper spec limit

= A structural approach to continuous improvement

Axis graduated in Sigma

between + / - 3 99.73 % 2700 ppm

between + / - 4 99.9937 % 63 ppm

between + / - 5 99.999943 % 0.57 ppm

between + / - 6 99.9999998 % 0.002 ppm

 Reduce the variation: when  < = Design specification width / 12 Cp > = 2