Puneet Project

NO OBJECTION CERTIFICATE
This is to certify that Mr. Puneet Khanna is permitted to use relevant data/information of our organization for her project
as a partial fulfillment of the PGDB!"perations management Program.
#e $ish him/her all the success.
%eal of the company %ignature of the uthorized %ignatory
Place&
Date&
DECLARATION OF LEARNER
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma )
This is to declare that * have carried out this project $or+ myself in partial fulfillment of the PGDB!
"P,-T*".% M.G,M,.T Program of %/D0.
The $or+ is original1 has not 'een copied from any$here else and not 'een su'mitted to any other
2niversity/*nstitute for an a$ard of any degree/diploma.
Date %ignature
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%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma 3
DECLARATION OF GUIDE
* certified that the $or+ incorporated in this Project -eport Mutual 5unds su'mitted 'y Mr. Puneet Khanna is his original
$or+ and completed under my guidance. Material o'tained from other sources has 'een duly ac+no$ledged in the Project
-eport
Date %ignature of the Guide
Place
Name of the Learner: PUNEET KHANNA
Regitration No: !"#!"#$!%
A&&re: HOU'E NON #!( BLOCK )G#( *IKA' PURI
NE+ DELHI ##""#,
TITLE OF PROJECT:'I- 'IG)A IN INDIAN INDU'TRIE'
PUNEET KHANNA
REGI'TRATION NU)BER: !"#!"#$!%
PUNEET KHANNA
'.)BIO'I' CENTRE OF DI'TANCE LEARNING
!"#!/!"#$
CONTENT'
INTRODUCTION TO 'I- 'IG)A
HI'TOR. OF 'I- 'IG)A
+HAT I' 'I- 'IG)A 0
+H. 'I- 'IG)A DE*ELOP)ENT0
BENEFIT' AND AD*ANTAGE' OF 'I- 'IG)A
DO1' AND DON1T1' OF 'I- 'IG)A
KE. CONCEPT' OF 'I- 'IG)A
THE)E' OF 'I- 'IG)A
THE 'I- 'IG)A ROAD)AP
'I- 'IG)A 2UALIT. TOOL' AND TE)PLATE'
I' 'I- 'IG)A RIGHT FOR U' NO+0
+HEN 'I- 'IG)A I' NOT RIGHT FOR AN ORGANI3ATION0
'I- 'IG)A TRAINING
TRAINING THE ORGANI'ATION FOR 'I- 'IG)A
LARGE ORGANI'ATION' THAT HA*E ADOPTED 'I- 'IG)A
U'E 'I- 'IG)A TOOL' TO )EET I'O 4""" RE2UIRE)ENT'
U'E THE I'O 4""" FRA)E+ORK TO A''E'' A 'I- 'IG)A '.'TE)
'I- 'IG)A AND 2UALIT. )ANAGE)ENT GLO''AR.
CA'E 'TUD.
Intro&56tion to 'i7 'igma
%i( %igma is a statistical concept that measures a process in terms of defects. chieving 9%i( %igma9 means your processes
are delivering only 4.6 defects per million opportunities :DPM"; ! in other $ords1 they are $or+ing nearly perfectly. %igma
:the Gree+ letter <; is a term in statistics that measures standard deviation. *n its 'usiness use1 it indicates defects in the
outputs of a process1 and helps us to understand ho$ far the process deviates from perfection.
sigma represents 8=)683.7 defects per million opportunities1 $hich translates to only 4>.?76@ of non!defective outputs.
That is o'viously a poor performing process. *f you have a process functioning at a three sigma level that means youAre
allo$ing 88?>B.3 errors per million opportunities1 or delivering =4.4)=@ non!defective outputs. ThatAs much 'etter1 'ut $e
are still $asting money and disappointing our customers.
The central idea of %i( %igma management is that if you can measure the defects in a process1 you can systematically figure
out $ays to eliminate them to approach a Cuality level of zero defects.
*n short1 %i( %igma is several things&
statistical 'asis of measurement& 4.6 defects per million opportunities
philosophy and a goal& as perfect as practically possi'le
methodology
sym'ol of Cuality
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma B
Hitor8 of 'i7 'igma
%ince the )=3>As the $ord AsigmaA has 'een used 'y mathematicians and engineers as a sym'ol for a unit of measurement in
product Cuality variation. :.ote itAs sigma $ith a small AsA 'ecause in this conte(t sigma is a generic unit of measurement.;
*n the mid!)=?>As engineers in Motorola *nc in the 2% used A%i( %igmaA an informal name for an in!house initiative for
reducing defects in production processes1 'ecause it represented a suita'ly high level of Cuality. :.ote here itAs %igma $ith a
'ig A%A 'ecause in this conte(t %i( %igma is a A'randedA name for MotorolaAs initiative.;
:/ertain engineers ! there are varying opinions as to $hether the very first $as Bill %mith or Mi+al Darry ! felt that
measuring defects in terms of thousands $as an insufficiently rigorous standard. Dence they increased the measurement
scale to parts per million1 descri'ed as Adefects per millionA1 $hich prompted the use the Asi( sigmaA terminology and
adoption of the capitalized A%i( %igmaA 'randed name1 given that si( sigma $as deemed to eCuate to 4.6 parts ! or defects !
per million.;
*n the late!)=?>As follo$ing the success of the a'ove initiative1 Motorola e(tended the %i( %igma methods to its critical
'usiness processes1 and significantly %i( %igma 'ecame a formalized in!house A'randedA name for a performance
improvement methodology1 i.e. 'eyond purely Adefect reductionA1 in Motorola *nc.
*n )==) Motorola certified its first ABlac+ BeltA %i( %igma e(perts1 $hich indicates the 'eginnings of the formalization of the
accredited training of %i( %igma methods.
*n )==) also1 llied %ignal1 :a large avionics company $hich merged $ith Doney$ell in )===;1 adopted the %i( %igma
methods1 and claimed significant improvements and cost savings $ithin si( months. *t seems that llied %ignalAs ne$ /,"
0a$rence Bossidy learned of MotorolaAs $or+ $ith %i( %igma and so approached MotorolaAs /," Bo' Galvin to learn ho$
it could 'e used in llied %ignal.
*n )==71 General ,lectricAs /," Eac+ #elch :#elch +ne$ Bossidy since Bossidy once $or+ed for #elch at G,1 and #elch
$as impressed 'y BossidyAs achievements using %i( %igma; decided to implement %i( %igma in G,1 and 'y )==? G,
claimed that %i( %igma had generated over three!Cuarters of a 'illion dollars of cost savings. :%ource& George ,c+esA 'oo+1
The %i( %igma -evolution.;
By the mid!)==>As %i( %igma had developed into a transfera'le A'randedA corporate management initiative and
methodology1 nota'ly in General ,lectric and other large manufacturing corporations1 'ut also in organizations outside the
manufacturing sector.
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma ?
By the year 3>>>1 %i( %igma $as effectively esta'lished as an industry in its o$n right1 involving the training1 consultancy
and implementation of %i( %igma methodologies in all sorts of organizations around the $orld.
That is to say1 in a little over ten years1 %i( %igma Cuic+ly 'ecame not only a hugely popular methodology used 'y many
corporations for Cuality and process improvement1 %i( %igma also 'ecame the su'ject of many and various training and
consultancy products and services around $hich developed very many %i( %igma support organizations.
%i( %igma stems from the Cuality movement that started after #orld #ar **. %i( %igma $as originally developed for
Motorola in )=?8 'y Bill %mith. *t $as conceptualized as a Cuality goal at Motorola 'ecause technology $as 'ecoming so
comple( that traditional ideas a'out accepta'le Cuality levels $ere inadeCuate. *n )=?=1 Motorola announced a five!year
goal ! a defect rate of not more than 4.6 million parts per million ! si( sigma.
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma =
+hat i 'i7 'igma
5irst1 $hat it is not. *t is not a secret society1 a slogan or a clichF. %i( %igma is a highly disciplined process that helps us
focus on developing and delivering near!perfect products and services. #hy 9%igma9G The $ord is a statistical term that
measures ho$ far a given process deviates from perfection. The central idea 'ehind %i( %igma is that if you can measure
ho$ many 9defects9 you have in a process1 you can systematically figure out ho$ to eliminate them and get as close to
9zero defects9 as possi'le
To achieve %i( %igma Cuality1 a process must produce no more than 4.6 defects per million opportunities. n 9opportunity9
is defined as a chance for nonconformance1 or not meeting the reCuired specifications. This means 'usinesses need to 'e
nearly fla$less in e(ecuting our +ey processes.
The %i( %igma can 'e defined in several $ays. *t is a Hhighly technical method used 'y engineers and statistician to fine
tune product and processI. *tJs a $ay of measuring processesK a goal of near perfection1 represented 'y 4.6 defects per
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma )>
million opportunities :DPM";K an approach to changing the culture of an organization. Most accurately1 though1 %i( %igma
is defined as a 'road and comprehensive system for 'uilding and sustaining 'usiness performance1 success1 and leadership.
*n other $ords1 %i( %igma is a conte(t $ithin $hich you $ill 'e a'le to integrate many valua'le 'ut often disconnected
management H'est practicesI and concepts1 including systems thin+ing1 continuous improvement1 +no$ledge management1
mass customization1 and activity 'ased management.

nother definition of %i( %igma is that itJs a goal of near perfection in meeting customer reCuirement. This is also accurate1
in fact1 the term H%i( %igmaI itself to statistically derived performance target of operating $ith only 4.6 defects for every
million activities or HopportunitiesI. *tJs goal fe$ companies or processes can claim to have achievement.
%till another $ay to define %i( %igma is as a s$eeping Hculture changesI effort to position a company for greater customer
satisfaction1 profita'ility and competitiveness. /onsidering the company $ide commitment to %i( %igma at place li+e
General ,lectric or Motorola1 Hculture changeI is certainly a valid $ay to descri'e %i( %igma. But itJs also possi'le to HDoI
%i( %igma $ithout ma+ing a frontal assault on your company culture.
*f all these definition measure1 goal or culture change at least partly 'ut not totally accurate1 $hatJs the 'est $ay to define
%i( %igmaG Based on our e(perience or e(amples set 'y the gro$ing num'er of companies see+ing %i( %igma improvement
$e have developed a definition that captures the 'readth and fle(i'ility of %i( %igma as a $ay to 'oost performance.
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma ))
+h8 'i7 'igma De9e:o;ment 0
The goal of the %i( %igma is to ena'le you to understand $hat %i( %igma is : 'oth a simple and a comple( Cuestion ;1 $hy
itJs pro'a'ly the 'est ans$er to improve 'usiness performance in years1 and ho$ to put it to $or+ in the uniCue
environment of organization. *n our mission to demystify %i( %igma for the e(ecutive and professional1 $e hope to sho$
you that itJs just as much a'out a passion for serving customer and a drive for great ne$ ideas as it is a'out statistics and
num'er crunching1 that the value of %i( %igma applies just as much to mar+eting1 service1 human resources1 finance and
sales as it does to manufacturing and engineering.
%i( %igma is a comprehensive and fle(i'le system for achieving1 sustaining and ma(imizing 'usiness success. *t is uniCuely
driven 'y close understanding of customer needs1 disciplined use of facts1 data1 and statistical analysis and diligent attention
to managing1 improving and reinventing 'usiness processes.
This is the definition that $ill provide the foundation for our efforts to unloc+ the potential of %i( %igma for your
organization. The types of H'usiness successI you may achieve are 'road 'ecause the proven 'enefits of %i( %igma
HsystemI are diverse1 including
/ost reduction
Productivity *mprovement
Mar+et share gro$th
/ustomer retention
/ycle!time reduction
Defect reduction
/ulture change
Product/service development
and many more.
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma )3
Benefit an& A&9antage of 'i7 'igma
There are numerous 'enefits of %i( %igma as a $ay to address issues and pro'lems. mong the 'enefits of %i( %igma is the
decrease in defects that are allo$ed to reach the customer. Lou can get some sense of the 'enefits of %i( %igma 'y
revie$ing some si( sigma projects. "ther 'enefits of %i( %igma include&
#< Im;ro9e& C5tomer Lo8a:t8
ccording to George Bo( 9ll models are $rong1 ho$ever some models are useful9. #e 'elieve you $ill find this model
:graphic; $hich starts $ith customer satisfaction1 customer loyalty and customer retention useful.
large factor in determining the li+elihood of success and profits in an organization is customer satisfaction. #hen there is
customer loyalty the customer retention rate is high and 'usiness results tend to follo$.
!< C5tomer 'atifa6tion
There e(ists an interaction 'et$een the desired results and customer satisfaction1 customer loyalty and customer retention.
They may go 'y other names such as patients1 clients1 'uyers1 etc. #ithout the customer it is impossi'le for any 'usiness to
sustain itself. chieving the desired results is freCuently a result of customer actions. ny 'usiness $ithout a focus on
customer satisfaction is at the mercy of the mar+et. #ithout loyal customers eventually a competitor $ill satisfy those
desires and your customer retention rate $ill decrease.
There are several levels of customers&
Dissatisfied customer!!0oo+ing for someone else to provide product or service.
%atisfied customer!!!"pen to the ne(t 'etter opportunity.
0oyal customer!!-eturns despite offers 'y the competition.
Dissatisfied customers are an interesting group. 5or every one that complains there are at least 37 $ho do not.
Dissatisfied customers 'y $ord of mouth $ill tell eight to si(teen others a'out their dissatisfaction. #ith the $e'
some are no$ telling thousands. =)@ of dissatisfied customers never purchase goods or services from the company
again. prompt effort to resolve a dissatisfied customerAs issue $ill result in a'out ?7@ of them as repeat customers
depending upon the 'usiness1 ne$ customer sales may cost 6 to )>> times that of a sale to an e(isting customer.
There has 'een less research on satisfied customers to determine $hat it ta+es for a satisfied customer to change.
#hy ta+e a chance on mere satisfactionG 0oyal customers donAt leave even for an attractive offer else$here. t the
very minimum they $ill give you the opportunity to meet or 'eat the other offer. Maintaining loyal customers is an
integral part of any 'usiness.
"ne of the $ays to help o'tain loyal customers is 'y having products and
services that are so good that there is very little chance that the customer reCuirements $ill not 'e met
"f course one of the difficulties is understanding the true customer reCuirements. ,ven $hen you have the
reCuirements in advance the customer can and $ill change them $ithout notice or e(cuse. Daving a good recovery
process for a dissatisfied customer is a necessity.
#hen * found this it $as attri'uted to %am #alton founder of #al!Mart.
A C5tomer
o customer is the most important person in any 'usiness.
o customer is not dependent upon us. #e are dependent upon him.
o customer is not an interruption of our $or+. De is the sole purpose of it.
o customer does us a favor $hen he comes in. #e arenAt doing him a favor 'y $aiting on him.
o customer is an essential part of our 'usiness!!not an outsider.
o customer is not just money in the cash register. De is a human 'eing $ith
feelings and deserves to 'e treated $ith respect.
o customer is a person $ho comes to us $ith his needs and his $ants. *t
is our jo' to fill them.
customer deserves the most courteous attention $e can give him. De is the life'lood of this and every 'usiness. De pays
your salary. #ithout him $e $ould have to close our doors. DonAt ever forget it.
%everal surveys have 'een done on $hy customers do not give a 'usiness
repeat 'usiness. -easons given 'y customers for not returning for repeat
'usiness&
Moved 4@
"ther 5riendships 7@
/ompetition =@
Dissatisfaction )6@
,mployee ttitude 8?@
These surveys $ould indicate that in addition to the technical training and jo' s+ill training provided to employees1 some
effort aimed at customer satisfaction and employee attitude is appropriate. -emem'er these may not 'e the people
normally thought as 9%ales People9. 5or e(ample Managers1 %upervisors1 %ecretaries1 ccounts Paya'le1 ,ngineers1
ccountants1 Designers1 Machine "perators1 %ecurity1 Truc+ Drivers1 0oading Doc+1 etc. if not helping to cultivate 0oyal
/ustomers are hurting your customer
retention. 8?@ of lost customers are due to one cause1 employee attitudeM
*n order to +no$ ho$ you are doing in this area there must 'e some measurement. Data indicate that less than 6@ of
dissatisfied customers ever 'other to lodge a complaint. Most just ta+e their 'usiness else$here. Test this on yourself. The
ne(t time you get less than $hat you consider ideal at a store1 'usiness supplier1 restaurant1 movie theatre1 hotel1 or any
other 'usiness $hat do you doG
/ultivating the customer relationship is +ey in achieving the desired 'usiness results. passive system that depends upon
your customers to inform you $ithout effort on your part is not li+ely to yield the information necessary to improve
customer retention.
=< B5ine Re5:t
,very organization $ants to achieve some level of results. 2nfortunately too often not everyone in the organization has the
same results in mind. Daving agreement on the desired results tends to focus efforts. ,ven if they do agree upon the 'asic
description of the results ho$ to measure achievement of those results is in disagreement.
2nderstand $hat the desired results are. %ome common result areas&
%ales volume
Profit 'efore ta(
Mar+et share
,arnings per share
-epeat 'usiness @
.e$ customers @
/ash 5lo$
/ycle Time
Patents issued
%afety performance
-eturns
#arranty claims
,nvironmental performance
Defect level
%crap
5irst pass prime
/ost per unit produced
De't to eCuity
Many others
gree on ho$ to measure the result area. *s the measurement system capa'le of producing num'ers that are useful for the
intended result areaG Do all of the affected people have confidence in the measurement systemG /an num'ers 'e generated
Cuic+ly enough to 'e usefulG Does the measurement depend upon the level of the resultG
Generally measurements over a continuum :e.g. @ completion; are more useful than yes/no :e.g. done/not done; type
measurement.
>< Data Ana:8i Before De6iion )a?ing
s part of the model $e e(plore information and gap analysis and ho$ that lin+s all of the other pieces together. %ee
statistical data analysis graphic and ho$ it completes the model. There are multiple reasons for doing data analysis. Most
are to do gap analysis 'et$een e(pected1 a standard or the competition..
ny organization that $ants to 'e successful must have a structured $ay of gathering data1 analyzing data and doing gap
analysis. ll important areas should have data collected and then turn that data though statistical data analysis into
information. Data in of itself is really not $orth very much. *t is only $hen the data is tortured 'y statistical data analysis to
reveal information that it 'ecomes valua'le. This gap analysis can vary in comple(ity and sophistication from some very
simple averages and histograms to comple( regression analysis.
Data collection for gap analysis can 'e done for a num'er of reasons. *n every area $e have discussed thus far there should
'e data that is analyzed to produce information. Based on information 'etter decisions should result at all levels in the
organization. fe$ of the uses of information resulting from statistical data analysis follo$&
)onitoring &
ny num'er of things can 'e monitored from mar+et conditions1 performance of various parts of the organization1
competitor actions/performance1 etc. The gap analysis is to assure that on going performance does not vary too
much from target. #hen done correctly1 gap analysis prompts action in the the area 'eing monitored. ll of the
statistical process control rules for special cause variation are e(amples of action criteria from monitoring. These
rules ma+e it easy to do gap analysis and +no$ $hen action is reCuired. Deming al$ays $arned against tampering N
that is ma+ing special cause corrections for a system that is in statistical control. #hen a process is in statistical
control common cause variation is present and a system improvement is reCuired and entirely different solution is
needed. 'usiness strategy $ill have a num'er of +ey performance areas each $ith a num'er of metrics that are
the leadership $ants to improve. *t is al$ays an interesting e(ercise in gap analysis to find out $hat is improvement1
or $hich direction is good. *s there a targeted goal for each metric and are $e on target for achieving that target.
Multi!period efforts that do not meet the target and come as a surprise to management are a clue that an adeCuate
monitoring system is not in place and on going gap analysis is not in place. Measurements and performance
indication should sho$ if progress is 'eing made or not. %eldom do efforts go for ))months $ith no change and
then in the )3th month all of the 'enefits are realized. "n going gap analysis from the the plan can prevent some
very ugly surprises. #ith proper reporting and trac+ing the %i( %igma projects should deliver in the areas important
to achievement of the %trategic Plan.
Ben6hmar?ing & favorite tool gap analysis. "ne of the early steps in any effort is to understand the current
performance. #e recommend understanding the cycle time for every one of your processes as $ell as those 'est in
class. This can then 'e used as a Benchmar+ against other organizations that have a similar process that difference is
simple gap analysis. Benchmar+ed point is also valua'le in determining if activities and efforts associated $ith a
%i( %igma project have had any impact. caution against using a single point value for doing the gap analysis.
5reCuently there are cyclic patterns1 seasonal effects and other influences that should 'e considered. t a minimum
$e 'elieve you should loo+ at the average over some period and then compare that average $ith an average over a
similar period of time after implementing a project. "f course the variation should also 'e considered $hile doing
gap analysis. %everal months of poor performance follo$ed 'y one e(ception month can easily yield the same
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma )B
average as the entire time period at moderate performance levels1 yet the information from the gap analysis is much
different. %ome Benchmar+ing has very structure statistical gap analysis and other use a more Cualitative gap
analysis of the data collected. *n most organizations there are several areas that are important. common fla$ in
Benchmar+ing is to target a single performance metric. Most organizations do not have a clear understanding of the
interrelationships and can improve one area to the detriment of another. n e(ample of this is in the area of $aste. *t
is relatively easy in many processes to change the $aste from solid $aste to air emission or liCuid $aste.
/oncentration on only one of these as a metric can often result in no net change is the total pounds to the
environment. *f the gap analysis is just for one type of emission misunderstanding can occur. The $aste just changes
form from a solid to air emissions or to liCuid and moves from one to the other $ith no net change in actual $aste.
The correct gap analysis is for each type of emission and also gap analysis for total emissions.
#hen 'enchmar+ing for a %i( %igma project collect data from multiple time periods and for several different
metrics a gap analysis can 'e done on each of the metrics. t a minimum1 +no$ the historical average performance
and variation 'efore attempting to do any sort of gap analysis.
Data Ana:8i & "ther fla$s are the reorganization efforts that eliminate staffing especially in support functions
$ith large claims of savings. The remaining people in a different cost center are still doing the $or+ often in a less
efficient fashion. ctivity Based ccounting can 'urst the 'u''le on many of these pseudo savings efforts. #hen
the Purchasing Department is rationalized and line people pic+ up the slac+ it is not uncommon to find that
productivity has decreased and the actual cost to do the Purchasing activity has increased rather than decreased as
claimed. #ithout a system to accurately collect and analyze data mista+es of this type are common.
s a suggested gap analysis activity to find out if this is a pro'lem in your organization1 go 'ac+ five years ago and
find out the total cost structure for a 'usiness. Then document all of the improvement ideas and projects during that
five!year period and the claimed savings :'oth single points in time and those that $ere to carry for$ard;. 2se a
simple time value of money and do a gap analysis on your are actually realizing vs.the 'enefits claimed from all of
those projects. *n one case a OP of Manufacturing claimed that if all the 'enefits from projects over a five year
period $ere real he $ould need no ra$ materials1 no energy1 no payroll and $ould 'e a'le to dou'le the production.
%i( %igma projects can ma+e major improvements in service and staff functions1 just 'e sure that the measurements
to do the gap analysis capture $hat is really happening. *t is easy to transfer costs from one function or location to
another. Ma+e sure your projects return the 'enefit to the organization as a $hole.
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma )?
Pre&i6tion & nother very valua'le use of data is ma+e predictions. "ne of the favorite tools is regression analysis.
*n fact one of the main reason for using statistics of any +ind to gain some capa'ility to ma+e predictions. Many
organizations have very sophisticated regression models for many facets of the 'usiness. The computer fol+s have
added to our le(icon G*G"PGar'age *n Gar'age "ut. ny prediction model is only as good as the inputs.
%ensitivity analysis of any model is high recommended. *n fact some people have conducted Designed ,(periments
on purchased proprietary models to gain a 'etter understanding of the factors and interactions.
$< Team B5i:&ing
0earn ho$ $orld class organizations used team 'uilding and employee motivation to 'ecome the leaders and stay there.
The essence of employee motivation is developing leadership s+ills. #ith dams ssociates effective team 'uilding and
employee motivation fit together. %uccessful organizations are not involved in team 'uilding as an end unto itself 'ut rather
'ecause $ith effective team 'uilding employee motivation increases and organizational results are achieved. ,ffective team
'uilding starts $ith efforts that are aligned $ith the organizational strategic plan. ,mployee motivation increases $hen
employees are $or+ing on real issues for the organization. %i( sigma plus projects have team 'uilding components and
employee motivation elements aimed at improving $ell!defined issues.
,njoyment in $or+ increases team 'uilding effectiveness. Team 'uilding is a tool for improving employee motivation. ll
teams go through very predicta'le phases. Kno$ing and understanding these phases gives leadership the confidence to
continue in the team 'uilding even $hen during one of the phases the employee motivation appears to 'e declining. #hen
leadership understands this is a normal phase they have confidence to continue team 'uilding for $orld class performance.
ssessments aimed at understanding yourself and others can speed team 'uilding. 2nderstanding is the first step in
developing employee motivation. #ith an understanding of other employeesA motivation every individual has the
opportunity to add to the synergy of the team.
%< )ea5re *a:5e A66or&ing to the C5tomer
#e are continuing to 'uild the model and consider measuring value as determined 'y the customer as evidence of customer
satisfaction.
The graphic measuring value is strictly a customer satisfaction issue. .o matter $hat the product or service the customer
determines $ith their dollars the value proposition. *t is possi'le to change that understanding through a variety of
efforts on your part 'ut ma+e no mista+e the customerAs satisfaction is the ultimate value measure of $hat is offered. %i(
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma )=
sigma see+s to understand that value from the vie$ of the customer and enhance the value in a $ay that is
advantageous to 'oth the customer and to the organization. #ith increased customer satisfaction the li+elihood of customer
loyalty increases.
%ome organizations 'ecause of unusual circumstances find themselves in a high sales environment $ith unusually high
margins. .ot infreCuently people can practice enough self delusion to convince themselves that the customer satisfaction
is high and customers agree that there is adeCuate value involved1 $hen the real reason is some sort of mar+et place
discontinuity. That is not to say that there is not a lot of money to 'e made during these times.
9Pet -oc+s9 $ere a nice fad that made handsome profits for some people 'ut no one really thought that the value $as
there for the price paid. s a fad it died in a very short time. *f your 'usiness see+s to capitalize on this sort of mar+et
place1 just realize that it is short lived and the value comes from the uniCue idea1 not from some underlying value or
need in society.
ny ne$ idea or product is in the position of trying to 'alance the true value and the 9ne$ness9 component.
classic of this is the early 5ord Motor /ompany. Denry 5ord insisted on driving the cost of cars do$n and ma+ing them
ine(pensive so the mar+et could 'ecome 'igger and 'igger rather that selling fe$er cars at much higher
prices. Let $hen the consumer tastes evolved to $anting colors other than 'lac+ that $as seen as a fad that $ould increase
the cost and $ould soon disappear. #hat almost disappeared $as the 5ord Motor /ompany. The changes in customer
tastes can 'e surprisingly fast1 if your processes do not have the cycle time capa'ility to respond others are li+ely to meet
the changing customer desires.
5e$ organizations can $ait on the mar+et place to inform them of e(actly $hat the value of the product or service1 even the
5ord Motor /ompany 'arely survived a miss reading. Let in many cases if too much time is spent on study and
evaluation the profita'le opportunity may have passed. %mall organizations have the a'ility to react and change
rapidly1 yet a fe$ large companies are a'le to +eep their product pipeline filled $ith profita'le innovation. 4M each
year e(pects to have 6>@ of the sales revenue from products that are less than four :6; years old. *n some 'usinesses it
ta+es that long to get approval for model changes of the same product. "ne of the most important competitive
advantages in the mar+et place today is speed. /ycle time reduction in addition to eliminating $aste has the real
'enefit of providing more opportunities to learn. ,very cycle is a learning opportunity. 5or those $ho learn in every
cycle1 if
they just complete the cycle one more time than you in the same time frame1 $ill in short order 'uild a huge
competitive advantage 'ecause they have learn and +no$ more.
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma 3>
s can 'e seen from the graphic the customer value $ill drive re!design and evolution of your products and services.
This Ooice of the /ustomer com'ined $ith technical consideration drive the product and service evolution.
Those $ho are not staying ahead of this evolution $ill soon suffer. Oideos are a good e(ample. The Beta Ma( from %ony
$ere first to mar+et and from $hat * am told a superior technical product to OD%1 yet OD% $ith ine(pensive players
and
a mar+eting move to get a $ider variety of movies drove the Beta Ma( from the field. "ne of the places that $e
'elieve si( sigma has great potential1 that is largely untapped1 is in the mar+eting functions of most companies. #hen the
mar+eting1 design1 manufacturing and design all 'ecome a team focused on driving customer value 'rea+through has
generally 'e achieved.
"ne method of measuring value is to consider the defects in the entire process of delivery to the customer.
0o$er defect levels $ill 'e of higher value. #ith si( sigma the concept of rolled through yield is very important. *f
defects occur in multiple places or stages 'efore reaching the customer they can all 'e added together to get the total
num'er of defect per unit. 2sing a Poisson appro(imation the
Lield Q e RR!DP2.
:Lield is eCual to e $ith the e(ponent of minus the defects per unit;. .ote that if you average ) defect per unit the yield
is >.48B??. %ome have multiple defects and a'out 48.B@ $ill ma+e it through $ithout any defects.
#here anything that is less than the e(pectation of the customer is a defect. Doing some simple math 84.4@ of the
customer interfaces $ill have a defect. There are multiple surveys that indicate that less than 6@ of customers $ill ever
complain. 6@ times 84.4Q 3.743 or appro(imately 4@.
#hich means that if 4@ of your customers :each transaction 'eing counted as a unit; complain then you have a defect rate
averaging ) per unit.
*n the Decem'er 3>>> issue of Suality Progress Gregory D. #atson suggests that there are three logical categories for
failures or defects. 5irst the product or service does not meet customer e(pectations1 second the price is not appropriate for
the customer to see sufficient value and third the delivery in not $ith in the reCuired time frame for the customer. The
assumption here is that all defects are the same in the eyes of the customer.
This vie$ of measuring defects from the perspective of the customer is essential if you are going to move the
improvements through si( sigma from incremental internal improvements to the dramatic customer focused changes
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma 3)
that are found $ith #orld /lass Performance. ll of the non!product related defects are no$ considered in the
yield. Dere our yield is customer satisfaction.
The implications of a 4@ complaint rate 'y customers are terri'le. "nly 'y chance are you a'le to produce defect free
product or service 48.B@ of the time and all of the remaining products or services have at least one defect and some
multiple defects. 5e$ 'usinesses can survive $ith that level of poor performance.
Measuring value is more than just considering the value of a product 'eing delivered to the customer as intended. The
value has to consider the total customer e(perience1 including all of the support services such as logistics1 accounts
receiva'le1 etc.
,< Effe6ti9e '5;;:8 Chain )anagement
#e add supply chain management and the impact of suppliers is included in our graphic model. 5e$ products or services
e(ist that so not reCuire some supply chain management. The more suppliers that are involved the more comple( the
supply chain management 'ecomes. ,ven if the entire supply chain from 'asic ra$ materials that come from the earth or
out of the minds and actions of people1 is not considered there is still a supply chain that must 'e attended. /ycle time of
each step and process in the supply chain sets the limit on ho$ fast the entire supply chain can function.
There have 'een a num'er or philosophies a'out ho$ to deal $ith the supply chain management. Bac+$ard integration1
develop as many suppliers as possi'le to ma+e the supply item a commodity1 competitive 'idding1 single source1 supplier
partnerships to name a fe$.
*n general the closer a product or service is to a commodity item 'y definition the more potential suppliers are availa'le.
This can ma+e the supply chain management e(tremely comple(. Maintaining tracea'ility 'ecomes much more
'urdensome. 5or e(ample in the 2% purchasing $heat is generally considered a commodity and there are thousands of
$heat farmers see+ing to fill the need. "n the other hand Kashmir $ool is not Cuite as readily availa'le in the 2% and there
are fe$er providers. :May'e in *ndia it $ould 'e a commodity item.; Tracing a specific load of $heat to a particular field or
farmers can 'e an almost impossi'le tas+.
Ta+e a relatively ne$ field that has Cuic+ly 'ecome a commodity service...$e' site development. The num'er of people
doing that +ind of $or+ has gro$n e(tremely fast. Let * am told that search engines inde( less than )4@ of all $e' sites.
less commodity service in this area are those $ho not only can get your $e' site inde(ed 'y search engines 'ut $ho can do
so $ith phrases that people actually enter and actually drive legitimate traffic to a $e' site. :*f you are interested in this area
$e have a strong recommendation 'ased on performance and affiliation.;
/ommodity suppliers are al$ays at the 'ottom of the economic food chain. The price they get for their goods or services is
generally out of their control and they are forced to ta+e $hat a fairly price elastic economy offers. This is not to say that
there are not commodity suppliers $ho have very successful and profita'le 'usinesses. They are al$ays see+ing to 'e the
lo$est cost producer and have little if any price influence. They have to 'e e(tremely cost sensitive to all of the factors
involved in their system. 2sually you $ill find the successful commodity suppliers see+ing to differentiate themselves from
everyone else in some fashion. 5aster delivery1 friendlier people1 easier credit terms1 'etter service1 consistency :lac+ of
variation; of product1 location1 'randing and 'rand allegiance1 customizing1 various pac+aging1 lot sizes1 etc. are all $ays
that commodity products and services see+ to move a$ay from that pure commodity image to a more specialized and
higher price 'ut 'etter value product or service.
Lour suppliers have a strong and important impact on your products1 services1 $or+ processes and distri'ution. The old
clichF is 9Lou canAt ma+e a sil+ purse from a so$s ear.9 *t seems o'vious that the Cuality of the ra$ material $ill have an
impact on the Cuality of the end product. There are many that attempt to reduce their cost structure at the point of contact
$ith the supplier and pay little attention to the internal processes and systems that use that ra$ material. There is a
multitude of $ays that the supplier relationship can impact 'eyond just the physical 9Cuality 9 of the ra$ material.
#ith %i( %igma Plus the goal is to meet the customer e(pectations 'etter than any one else and at a minimum 'e a'le to
deliver at a defect rate of less than 4.6 PPM there are t$o 'asic approaches to do that.
"ne is to have you process centered as $ell as possi'le at the target value. This is the on target component. /lassic %i(
%igma allo$s for a ).7 standard deviation shift to compensate for the fact that fe$ if any processes remain sta'le centered
e(actly on the target value. The second $ay to approach %i( %igma is to reduce the variation in the process to the level that
even $ith a ).7 standard deviation shift the chances of a defect are less than 4.66 ppm. The o'jective is really 9"n target
$ith minimum variation.9
%uppliers have the opportunity to greatly influence 'oth of the o'jectives. They are at the 'eginning of the chain of process
steps for your product or service.
ssume that you have five process steps in your organization all of $hich are performing at 'etter than a %i( %igma level1
lets say 4ppm defect level. This is >.=====B good at each process step. 5or argument sa+e there is no inspection and sorting
of the good from the 'ad1 you are using $hat the supplier furnishes and shipping to your customer. *f your supplier is at the
same >.=====B performance level the defect rate for these si( steps : 7 of yours plus the supplier ;is
>.=====BR>.=====BR>.=====BR>.=====BR>.=====BR>.=====BQ>.====?3 or )? ppm defect rate. -ealizing this has failed to
meet you o'jective of less than 4.6ppm defect rate you and all in your organization put in a lot of creative and hard $or+
and reduce each of your process steps to )ppm defect rate. Lour supplier impressed $ith a 4ppm defect rate neglected
controlling the process and the defect rate from the supplier clim's to )4ppm. The overall performance after all of your
$or+ and effort is no$ >.====?3R>.======R>.======R>.======R>.======R>.====?BQ>.====?3. ,(actly the same place
you started $ith )?ppm defect rate. *All leave the math to you to prove that $ith five process steps at >.====== even if the
supplier $ere perfect the 'est you can do is 7ppm defect rate.
These calculations demonstrate a num'er of important concepts. "ne is that suppliers can have a tremendous impact on
your products and services. nother is that it does not matter $here in the seCuence the defect rate is high it $ill impact the
overall performance. ,ach step is a supplier for the ne(t process step. %uppliers do not have to 'e e(ternal to your
organization. Thin+ of all processes as a com'ination of a num'er of simple three component process steps. :supplier to
process to output ; . This part of the reason for DemingAs drive to reduce the num'er of suppliers. Performance level for one
supplier is difficult to maintain1 as the num'er of suppliers are increased the variation increases. There are t$o sources of
variation1 that $ithin each supplier and the variation 'et$een suppliers. Daving effective supply chain management can 'e
an important part of any si( sigma defect reduction effort.
Those of you $ith some math inclination $ill Cuic+ly realize that the overall process $ill al$ays perform at a level less
than the $orst single process step. simple strategy for improving performance is to eliminate process :reduction in
comple(ity; also done in cycle time reduction. Bac+ in the original e(ample if $e only had four steps plus the supplier all
performing at >.=====B the end result is >.====?7 a 4ppm defect improvement rate 'y eliminating one process step.
%ome organizations that have started to reduce the num'er of suppliers in order to reduce some of the variation1 understand
that it is not the num'er of companies that they have as suppliers that is important 'ut rather the num'er of processes that
provide the product or service. These organizations $ill Cualify a supplier on a process 'y process 'asis and insist upon
+no$ing if there is any change to the supply. This could 'e a change in machinery1 a processing step1 personnel1 storage
conditions or anything else. *t is not that they $ant to run your 'usiness 'ut rather and understanding of just ho$ little it
ta+es early in a process to have major impact at the end. Much li+e the ripple from a roc+ thro$n in a pond1 the diameter of
the ripple just +eeps getting 'igger and 'igger.
2nderstanding this $ill drive you to focus your improvements including as far up the supply chain as you can get. This is
contrary to the intuitive approach of having a defect in a product and loo+ing that the last process step 'efore the defect $as
discovered and attempting to ma+e the improvements at that process step first. #e contend the 'est approach is to
document the various process steps involved and o'tain data a'out the performance of each process step. *t $ill 'ecome
apparent $here the 'iggest opportunities e(ist. *f this is done $ith cycle time reduction and/or comple(ity reduction
sometimes the highest defect producing process step can 'e totally eliminated.
4< Deign an& Re&eign Pro&56t@'er9i6e
#e continue to 'uild the model and consider product design 1 redesign and products revie$s. "ur model includes product
revie$s as an important consideration of the over all effort1 $ith customer surveys as a prime input.
Most products or services that do not change and evolve $ill have limited success in the mar+et place. The cycle time for
each improvement is a critical measure of success. #ithout adeCuate customer surveys it is difficult to understand the
product design features that are contri'uting to the product/service success or lac+ of success. "n a regular 'asis product
designs should 'e evaluated and regular product revie$s conducted. %ome such as the auto industry have loc+ed themselves
into a cycle of a ne$ model every year. 5reCuently these are minor or just cosmetic changes. #ith %i( %igma Plus the
redesign of Products and %ervices should 'e 'ased on the Measured Oalue from the /ustomers and %upplier capa'ilities. *f
done correctly the -edesigned Product and %ervice should do a 'etter jo' of meeting and e(ceeding /ustomer e(pectations
than did the original product or service.
#hen %i( %igma Plus is applied the economic return on investment should improve for the Business 2nit involved. Better
products $ith fe$er defects1 cost reduction projects1 'etter understanding of the /ustomer1 improved $or+ flo$1 employee
commitment1 supplier involvement and reduced cycle times are 'ut a fe$ of the consideration in product revie$s. /hanges
in product design should reduce comple(ity1 have fe$er defects1 improve relia'ility1 and offer the /ustomer functionality
not in the original product design or service. #hen these o'jectives are met there is a direct cause and effect relationship to
improved margins and larger mar+et share.
"nce your customers have developed a lo$ tolerance for defects1 you have a uniCue mar+eting advantage over your
competitors. This is true provided you continue to focus on the /ustomer /ritical /riteria and improvement processes. *n
these areas mentioned1 it is going to 'e very difficult for a competitor to match the level of performance your customers
have learned to e(pect from your 'usiness organization.
"ne of the interesting areas of competitive advantage1 achieved 'y some organizations1 is to improve their support
functions and reduce the defect levels. "ne area that continues to amaze is the technical support from soft$are vendors. The
first pro'lem is the o'vious defect that has 'een allo$ed to get to the customer or there $ould 'e no need for the technical
support. Let the all too true jo+e is 9 *f you $ant office music all you need to do is call technical support and put your
phone on the spea+er function9. #hile many feel they must have the latest release of all soft$are1 there are a num'er of
organizations that refuse to purchase the first release of any soft$are. /orrecting 'ugs may cause other pro'lems1 'ut
usually 'y the second or third release most are suita'le for designed use.
%imilarly many of us refuse to purchase the first model year of an automo'ile. The num'er of defects and recalls is
generally pretty staggering 'ased on our past e(periences.
Despite e(tensive mar+et research1 product design trials and numerous product revie$s and other efforts1 failure of ne$ and
re!designed products remains high.
"ne source attached to this failure is often the customer surveys that are conducted as part of the product design.
common and often poorly designed activity is customer surveys. *n a )==? Suality Progress rticle1 Ken Miller as+s Tre
your surveys only suita'le for $rapping fishGJ Dis ans$er in too many cases is yes. s Ken Miller $rites1 9The popularity
of customer surveys is on the rise. Lou canAt go any$here $ithout 'eing as+ed to complete one. They are in most every
hotel room and restaurant and on every airplane.9
Miller identifies the follo$ing common pro'lems $ith customer surveys&
The $rong people are surveyed
The $rong Cuestions are as+ed
The Cuestions are as+ed the $rong $ay
The Cuestions are as+ed at the $rong time
%atisfaction and dissatisfaction are assumed to 'e eCually important
Those $ho did not 'uy or use the product/service are not surveyed
%urveys are conducted for the $rong reasons
The results are generalized to groups not surveyed
%urveys are used as a su'stitute for 'etter methods
The results do not direct improvement actions.
*f you are counting on this +ind of information to help shape the products design your products and services it is li+ely they
do no 'etter1 or even $orse than $ithout the survey. ccording to Ken Miller most customer surveys could 'e vastly
improved if they as+ed&
#hat $as e(pected or $antedG
#hat $as e(periencedG
#hat are you level of satisfaction $ith the product or e(perienceG
#hat is the degree of relative importance of this varia'leG
%i( %igma Plus focuses on the /ustomer /ritical /riteria :the important varia'les; that drive a successful product design or
service. 2nderstanding $hat the voice of the customer is really saying is of vital importance.
The product revie$s or service revie$s using customer surveys should do a 'etter jo' of meeting the identified /ustomer
/ritical /riteria or address customer concerns and issues not met $ith the original product design or service. mong those
to 'e considered are e(panded functionality1 reduced cost1 improved relia'ility1 more attractive design1 etc.
Suality 5unction Deployment :S5D; and the resulting 9Douse of Suality9 chart is a tool that is can 'e used to 'alance the
often!conflicting reCuirements. Multifunctional teams are used in the development1 and the resulting matri( can serve as an
important communication tool. The /ustomer /ritical /riteria are listed and ran+ed. 2sually a comparison 'et$een the
e(isting design and competitors designs is included in the evaluation. ,ngineering reCuirements needed to meet the voice of
the customer are compiled. The relationships 'et$een the customer reCuirements and the 9engineering ho$9 are sho$n in
the relationship matri(. "'jective measurements for each reCuirement are identified and technical difficulty assigned.
Positive and negative relationships 'et$een design reCuirements are determined along $ith relative importance ratings. #e
should utilize this study to identify important issue:s; that can 'e sent for$ard in yet another iteration concerned $ith
detailed design. Dra$'ac+s to S5D include the amount of time and effort reCuired1 survey errors1 and some of the
su'jective assessments that are made. *t is generally for this reason many people choose to ma+e a first attempt 'y using
simpler approaches.
simple cause and effect matri( can often accomplish a good deal of the desired results $ith much less effort.
The outputs of a process are assigned an importance value such as& )!lo$ 7!medium =!high and the customers of the
process are as+ed to provide the ran+ing.
*mportant process inputs are ran+ed on the same scale for impact on each output varia'le. team of process e(perts should
achieve consensus on these ran+ings in a team meeting1 independent of the customer ran+ings.
#hen the t$o ran+ings are then placed in a matri(1 $ith the process varia'les in the vertical column and the customer
ran+ings in the horizontal ro$. The resulting product :multiplication of the ro$ times the column; is placed in each cell.
.e(t add cells in each ro$ and create a Pareto /hart. This $ill let you +no$ $hich input varia'les have the 'iggest impact
on the customer.
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma 3B
This sort of matri( can 'e carried do$n another level $here the +ey process varia'le can 'e 'ro+en do$n into attri'utes and
the process 'ro+en do$n into the individual steps. This allo$s for the process steps to 'e ran+ed according to the impact on
the various attri'utes.
#e have found this sort of step$ise analysis $hich is easier for most team mem'ers to understand and accept than a S5D
matri(1 also it can 'e carried out at several deeper levels.
#"< De9e:o; Lea&erhi; '?i::
#e are continuing to 'uild the model and consider the impact of leadership Cualities and leadership s+ills. %ee the graphic
leadership Cualities.
0eadership s+ills are needed at every level in the organization. /onsistent training and approach from the e(ecutive level
through managers and supervisors $ill help all in the organization develop their leadership s+ills.
Development of leadership s+ills and leadership Cualities can start at very early ages. There are a large num'er of youth
groups that $ill assist young people $ith leadership training so they can develop critical leadership s+ills. Too fe$ adults
spend the time to ta+e leadership s+ills leadership Cualities training to understand and $or+ on development of the
leadership s+ills and leadership Cualities learned in their youth. %ome chose to ignore much of the leadership training once
they move out side these organizations. "pportunities to develop leadership s+ills and leadership Cualities outside $or+ are
not limited to youth groups. %ocial service organizations1 church and local government offer a $ealth of opportunities for
those interested in developing leadership s+ills. ,ven if you never have any intention of aspiring to a management position
in your organization opportunities a'ound for the application of leadership s+ills. ,very organization needs people $ith
leadership Cualities.
"ne of the primary mechanisms of management demonstrating leadership Cualities it has1 is in strategic planning. *f %i(
%igma Plus is part of the strategy there are many opportunities to develop leadership s+ills and leadership Cualities at other
levels in the organization.
*n any organization leadership Cualities can al$ays 'e e(panded. #ith %i( %igma Plus one of the o'jectives is to e(pand
the concept of leadership s+ills 'eyond that of organizational position. 5reCuently people eCuate leadership $ith some title1
position1 or ran+. Those $ho have demonstrated leadership Cualities freCuently have these titles. 2nfortunately there are
cases $here the title or position has 'een granted 'efore the leadership s+ills have 'een developed. This is an indication of
lapse of leadership responsi'ility 'y those $ho place an unprepared person in a role reCuiring e(tensive leadership s+ills.
Too often very successful technical people are placed in roles $ith leadership reCuirement $ithout 'eing prepared. The 'est
engineer is made ,ngineering Manager or the 'est operator is made %upervisor. .one of us $ould allo$ people untrained
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma 3?
in /ivil ,ngineering to design and 'uild a major high$ay. .either $ould many of us $illingly go into surgery $ith the
person performing the operation having no training in medicine. Let many of our management and supervisory positions
are filled $ith very competent technical people $ith little preparation for management or supervisor duties. *n those cases
there are 'asically t$o options. "ne is to move along and hope that instinct and a good support structure $ill 'e adeCuate.
The second option is 'egin accelerated leadership training aimed at developing the leadership s+ills and +no$ledge 'ase
reCuired for a leadership position.
%i( %igma Plus implementation offers an alternative $hile providing major improvements at the same time. 0eadership
s+ills are honed and major improvements are made in the organization at the same time. Those $ho $ish to participate or
lead their organization in the application of %i( %igma Plus are guilty of professional malpractice if they do not enhance and
continue to develop their personal leadership s+ills. /hampions and Blac+ Belts have direct and immediate leadership
challenges.
The /hampions are charged $ith interfacing $ith %enior Management and the Blac+ Belt organization. Their a'ility to
gather support1 resources and commitment from %enior Management $ill often mean the difference 'et$een success and
failure of a %i( %igma effort. *f the /hampions do not lead the Blac+ Belt selection1 education and development of the
individuals1 odds for success decrease dramatically. "ne of the most critical leadership responsi'ilities for the /hampion is
to assure that Blac+ Belts $ho have spent t$o years or so $or+ing on improvement projects are moved 'ac+ into
responsi'le positions $ithin the organization. *f this +ey leadership responsi'ility is not actively pursued then the
organization $ill Cuic+ly see the %i( %igma Plus Blac+ Belt as a career!ending move. The organization has severely limited
the effectiveness of any %i( %igma effort if Blac+ Belts $ith an increased s+ill set and ne$ level of +no$ledge are not
moved 'ac+ into the line organization $here these s+ills can 'e leveraged even more.
short sighted approach is to value of the Blac+ Belts in returning value to the 'ottom line of the organization in very short
periods of time and $ishing to +eep these people contri'uting in this fashion. n argument is the training $as e(pensive in
'oth time an money and $e should +eep Blac+ Belts $or+ing as Blac+ Belts even longer. This is a short!term vie$ that $ill
eventually +eep the 'est and 'rightest from ever accepting a Blac+ Belt assignment. *nstead consider the leverage if a
manager has the training1 understanding and e(perience of 'eing a Blac+ Belt. Better project selection1 implementation and
retention of the 'enefits of a Blac+ Belt project $ill result. lso $hen it is clear that Blac+ Belt is a reCuirement for
advancement 'eyond a certain level then the Cuality of people see+ing Blac+ Belt training and application $ill increase.
Blac+ Belts have a duty to increase their leadership s+ills $hile $or+ing on projects. Team selection and 'uilding offer the
Blac+ Belt e(cellent opportunities to develop leadership s+ills. ny Blac+ Belt that is not increasing their +no$ledge and
s+ill 'ase in people leadership1 project management and understanding of the language of management :money; during in
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma 3=
each project is cheating themselves and the organization that has invested in them. Blac+ Belts are not technical e(perts
$ho have learned some statistics and other tools. They are instead people $ho have 'een given an opportunity to add to
their technical s+ill level $ith some very specific training and an opportunity to apply those s+ills on projects in a very
rapid fashion. #hile applying those ne$ s+ills there is also the opportunity to enhance the leadership s+ills. ny Blac+ Belt
or organization that has Blac+ Belts and vie$s them as technical e(perts only is missing the largest 'enefit of %i( %igma
Plus.
%enior Management that is not selecting its managers from the ran+s of those $ho have 'een trained and practiced the s+ills
and +no$ledge of a Blac+ Belt does not understand the true 'enefits and leverage of a %i( %igma Plus implementation.
#ithin just a fe$ years after starting a %i( %igma application1 no person should 'e moved to a management position unless
they have completed Blac+ Belt training and have demonstrated the mastery of leadership s+ills 'y successfully completing
several projects. %i( %igma Plus must 'ecome the primary management development program $ithin the organization. *f
this does not happen then the %enior Management has had an unconsciona'le lapse in leadership application. %i( %igma
$ill not have the opportunity to deliver the +inds of improvements possi'le. .ot 'ecause the %i( %igma Plus process can
not deliver the improvements 'ut 'ecause of a lac+ of leadership and misapplication of a very po$erful approach.
Management must assure that the %i( %igma leadership training and development afforded the Blac+ Belts is appropriate
for the high performance e(pectations. #hile statistics understanding and application is very important there are leadership
s+ills that are eCually important. *t is the synergistic com'ination of the t$o that produces a successful Blac+ Belt.
##< Integration of Pro&56t( 'er9i6e an& DitriA5tion
More direct controlla'le factors in esta'lishing loyal customers are your products1 services1 $or+ flo$ and distri'ution
services. "ur graphic model includes products1 services1 $or+ flo$ and distri'utions services and their relationship to the
other elements. These are all the $ay they are 'ecause that is ho$ the organizational leadership $ants them to 'e. *f the
leadership didnAt $ant them to 'e ho$ they are they $ould have changed them or $ould have an active effort in place to
change them. ny dissatisfaction $ith these at the top leadership level just means the pain they perceive reCuired for the
gain is not $orth the pain of the change.
s part of the effort to maintain and 'uild loyal customers product and service performance1 $or+ flo$ performance :cycle
time is one +ey measure; and distri'ution services performance each have an impact. These must 'e considered 'ased on
the impact on the customer. ,very product or service has some performance criteria. ,very time that performance criteria
is not met it is an error1 defect1 mista+e1 omission1 off!spec1 non!prime1 second1 reporta'le1 etc. $hat ever the terminology is
for your product or service. These hurt customer loyalty1 even if the customer never sees them 'ecause they $ere caught1
corrected1 off graded1 recycled1 scrapped1 re$or+ed etc.
/hanges the concept and early design phases are much less costly than at any other time. /ost go up e(ponentially as a
product is moved from concept to design to prototype to field trial to full production and finally to the hands of the
customer. This is not to say that mista+es $henever detected should not 'e corrected1 'ut rather that effort in eliminating
the mista+es or pro'lems at the front end of the process is much more efficient.
Mista+e proofing and Po+e Lo+e concepts applied to the engineering and design of a product pay unimagined dividends
later in the process. ,arly consideration on $ays to ma+e a product fail can result in more ro'ust designs and 'etter
performance in the hands of the consumer as these failure modes are addressed. *t is not unusual for a solution to e(ist that
has essentially no additional cost or comple(ity. *n fact reduction of comple(ity $ill generally 'e an advantage. 5unction
nalysis can help discover paths to some of these solutions.
5eed 'ac+ of -elia'ility ,ngineering data from similar components or products in a valua'le resource. /losing the loop
from design to field relia'ility should 'e part of every design process.
*t is o'vious that there can 'e an impact on the customer if the customer is forced to suffer $ith less than the performance
e(pected. Oery many occurrences and there is an ,U customer.
,ven $hen the defect does not get to the customer it hurts customer loyalty. ,very defect costs more than the good product
or service at the same point in the process. The same $or+1 effort1 ra$ materials and other resources are consumed yet
'ecause of the defect it has less end value. This means the good product or service must carry the 'urden of the 'ad
product or service. t the very minimum the customer is paying more for the product or service that is good or the margin
of profit is less than it could 'e. The impact of defects is much deeper than this simple e(planation. Through put1
inventory1 ra$ material1 disposal1 inspection1 energy are all impacted 'y defects. #ith %i( %igma Plus a +ey activity is to
+no$ $hat the defect rate is and $hat it is costing. This seemingly simple measurement can often 'e enlightening.
,fficient and effective $or+ processes do not place unreasona'le demands upon the people that have to use them. The
steps are natural and there is little $asted motion effort or comple(ity. #hat is needed is done1 reCuirements are met $ith
confidence1 and it just ma+es sense. Too often the restrictive $or+ practices are the result of a pro'lem $ith a very small
num'er of people and to cover up rather than address and correct that issue everyone is made to suffer. *t seems the larger
the organization the more rules and restrictions are in place to cover the possi'ility that ) or 3@ of the employees might
a'use an opportunity and all employees are forced to suffer $ith the 9solution9. /ycle Time nalysis $ill usually sho$
$here the unnecessary rules and restrictions are getting in the $ay of meeting customer e(pectations. Key $or+ processes
freCuently can 'e performed in 3>@!7>@ of the original time $ith no addition of resources and fe$er defects 'y applying
the results of this +ind of analysis.
simple e(ample& t a relatively remote location the most convenient place to have lunch is the company cafeteria. *n
order to ma+e it easy $hen meeting $ith customers on location1 legitimate 'usiness lunches could 'e signed off at the
chec+out register. Because of a'use 'y a very fe$ this $as eliminated and no$ e(pense accounts must 'e filed for all
'usiness e(penses at the cafeteria. .ot only $ere the innocent punished1 the guilty $ere never challenged and additional
comple(ity $as added to a simple process adding time and cost to all $ho use the cafeteria for 'usiness. #ith this +ind of
thin+ing the comple(ity that is added to the 9serious9 $or+ processes must 'e huge.
The 'est analogy * +no$ for an effective and efficient $or+ process is a large 'all at the top of an incline. *t ta+es $or+ to
get it started 'ut then gravity ta+es over and it is easy to move the 'all to the 'ottom of the incline. /ontrast this $ith the
$or+ process that starts $ith the 'all at the 'ottom of the incline and it must 'e moved up. Gravity $or+s against
completing the process. ny distraction1 inattention1 competing priority or just a 'ad moment and it is $orse than starting
at the 'eginning. Lou have to go retrieve the 'all from $here ever it stopping rolling and get it 'ac+ to the starting point.
re your and those in your organization helping the 'all do$n the incline or fighting to push it to the topG
"ne of the $ays that many have used to improve $or+ processes is through Benchmar+ing. *n classic Benchmar+ing the
search is to find the 'est in class at a given $or+ process or function. To +no$ $hich #or+ Processes need improvement
reCuires that your o$n #or+ Processes are understood at least $ell enough to 'e a'le to compare them to #orld /lass
Performance. Most people attempt to do Benchmar+ing $ithin their o$n industry. The common refrain is& 9#ho has done
this in the injection molding 'usinessG9 utility 'usinessG insuranceG9 health careG People seem to e(pect they can
al$ays find $hat they $ant in their o$n industry. That just +eeps you in the herd. /ompetitors may 'e $illing to share
some information 'ut are not li+ely to share the things that $ould 'ring your process up to their level.
Major 'enefits come from loo+ing outside your industry to find $ho is #orld /lass at the process or function you are
see+ing to improve. Most organizations that $ill share $ith you are going to e(pect something in return. t a minimum 'e
prepared to ans$er a'out your o$n organization every Cuestion you as+ those you 'enchmar+.
Blindly copying $hat others are doing $ill seldom give the +inds of gains possi'le from Benchmar+ing. Being a'le to
transfer concepts and practices from one industry to another is $here Benchmar+ing has added value.
cycle time reduction effort properly applied is one $ay to ma+e significant improvement in any important $or+
processes. *t allo$s you to $or+ on your o$n processes $ith your o$n people and provides a clear performance criteria1
time. n advantage over Benchmar+ing is that you do not have to go out and find the #orld /lass performers and then
ma+e the necessary arrangements for visits and the e(change of information. *f the #or+ Process directly touches the
/ustomer1 time to complete a process could very easily 'e a very important customer critical measurement. #ith %i(
%igma Plus you $ant to 'e sure that your process is so good that there is less than 4.6 chances per million of not meeting
that time measure.
*n either case a good understanding of the #or+ Process as it is currently 'eing done is reCuired. *t is not unheard of to do
'oth on the same #or+ Process.
Distri'ution services can 'e as important as any element in esta'lishing customer loyalty. Distri'ution has impact in
receiving orders1 ra$ materials1 supplies1 and utilities as $ell as getting product to the customer. Many a product has 'een
though all the manufacturing process $ith all the potential miscues there only to fail the customer 'ecause of distri'ution.
,ven if the correct product1 it can 'e late1 early1 at the $rong location1 contaminated1 damaged1 $rong size1 $rong pac+age1
or fail to meet customer e(pectations in a variety of other $ays. #ith an increase in E*T :just in time; systems the demands
on the distri'ution system can 'e a serious customer satisfaction issue.
/onsider #al!Mart $hen evaluating ho$ important distri'ution can 'e. They manufacture nothing1 have no one to $ait on
you in the store1 treat their suppliers harshly and yet are very successful in large part 'ecause of the understanding and
application of distri'ution technology.
.ote& 5rom some friends in *ndia. 9 /ustomer9 attri'uted in an earlier ne$sletter to %am #alton $as originally
propounded 'y Mohandas Karamchand Gandhi or Mahatma Gandhi1 :*ndian ! 5ather of the .ation;. This statement of his
is displayed in all the 'ranches of the largest 'an+ in *ndia :over )31>>> 'ranches;1 %tate Ban+ of *ndia.
#!< A:ignment Bith 'trateg8 *iion( an& *a:5e
"ur graphic model adds %#"T analysis1 strategic planning1 vision statement1 mission statements and 'usiness plans.
*n developing 'usiness plans and doing strategic planning goal setting some very 'asic Cuestions are addressed&
#hy do $e e(ist as an organizationG our mission statement.
Do$ do $e do $hat $e doG core processes.
#here are $e no$G %#"T analysis.
#here do $e $ant to 'eG vision statement.
Do$ can $e get thereG 'usiness plans.
#hat $ould tell us if $e arrivedG metrics.
Trusting your organization to gro$ and develop in a haphazard fashion is ta+ing a large chance on the future. Better to have
at least some general ideas of $here you $ant to ta+e it and $hat is a desira'le direction considering current conditions
:%#"T analysis;. This is the fundamental reason for doing strategic planning . Guidance documents include the vision
statement and mission statements. Details of ho$ to live the mission statement and reach the vision are captured in the
specific 'usiness plans.
,verything in the $orld is created at least t$ice. "nce in the mind of the creator and then as the actual product or service.
There may 'e accommodations or changes over time 'ut at some point someone some$here had an idea of $hat $ould 'e
developed. This vision of $hat the future should hold is essential for any organization to control its destiny. #ithout a
vision that 'rings focus and direction an organization is li+ely to drift and $ander depending upon the tides and currents of
events. 5or most that is not an accepta'le alternative and $e prefer to have more control over our organization.
vision statement is that clear future state or position that offers the ideal of $hat $e $ant our organization to 'ecome. 5or
most it is something that can never Cuite 'e achieved 'ut is still $orthy to strive in that direction. 5or many %i( %igma is
part of that vision. chieving a performance level that has less than 4.6 ppm defect or error rate may seen li+e the
*mpossi'le Dream for some1 yet for otherAs it has 'een achieved. May'e not for every product or service 'ut for at least
some and they are on an improvement path for even more. "ne of the 'iggest hurdles to overcome is the realization that no
matter ho$ good your organization is no$ it could 'e 'etter. ,very defect or deviation from the ideal represents additional
costs and $aste. To have a compelling dissatisfaction $ith those departures from ideal and deciding to do something a'out
it is reCuired for %i( %igma implementation. "nce that decision is made the tools1 techniCues and approaches have 'een
demonstrated 'y others and hence can 'e learned $ithin your organization.
%upporting any vision statement is a set of values for an organization. These may or may not 'e $ritten do$n1 none the less
they e(ist and most employees have a firm understanding of $hat they are. #hen the $ritten and the actual values differ
you can 'e sure that the employees +no$ $here there are differences. The value system $ill have fundamental influence on
ho$ customers and employees are treated and ho$ employees react to management direction and initiatives. 5or %i( %igma
to succeed there must 'e a culture of improvement. *f this is not in place creating it is a major implementation step.
mission statement is the purpose of the organization. *t states $ho $e are1 $hom $e serve $hat products and services $e
provide and ho$ $e ma+e those products and services availa'le to our customers1 clients1 or patients. The mission
statement tells $hat the organization $as formed to do. %ome li+e to include levels or performance in the mission
statement. * contend that just adds comple(ity. %tate $hat you are a'out and let the performance spea+ to the level or
Cuality.
#ith values1 vision and mission understood a strategy should 'e developed. To attempt to develop a strategy 'efore values1
vision and mission are clear1 understood1 and accepted is a mista+e. Suite simply strategy is the o'serva'le actions in the
mar+etplace that lead to a competitive advantage. Keys are o'serva'le actions1 mar+etplace and competitive advantage. *f
any one of these is missing there may 'e some nice sounding $ords1 pretty pictures and flo$ery tal+ 'ut there is no
strategy.
/ommon $or+ in developing a strategy is a num'er of assessments 'oth internal and e(ternal to the organization. 5rom
every assessment strengths1 $ea+ness1 opportunities and threats :%#"T analysis; are evaluated. "nce a clear understanding
is in place specific 'usiness plans are developed. This should 'e done at the Business 0evel. 5or large organizations $ith
many 'usiness units1 su'sidiaries or divisions each may 'e allo$ed to develop their o$n 'usiness plan. #ithout some
oversight this can result in divisions of the same company hurting each other. 5or instance having Pontiac and "ldsmo'ile
competing in a mutually destructive fashion.
"nce a %trategic Direction is set there are some general o'jectives that should 'e accomplished. 5rom those o'jectives1
goals are developed meeting the %M-T criteria. :%pecific1 Measura'le1 ction "riented1 -ealistic1 Time 'ound;. ,ach
goal should have action plan:s; to assure they are achieved. 5reCuently some of the goals from one level 'ecome o'jectives
for the ne(t level do$n in the organization. #hen this happens it assures that goal oriented action plans any$here in the
organization can 'e traced up the organization to demonstrate they are in support of the top level o'jectives and strategy.
#hen there are gaps in that lin+age it is common to have misunderstandings and efforts that are not aligned and hence not
as efficient nor as effective as they could. ,ffective team 'uilding starts at the e(ecutive level1 includes management
training at all levels including front line supervisors and has a leadership s+ills development training plan for every
employee.
%i( %igma can 'e an integral part of strategic planning or a 'usiness plan.. 5or a strategy involving cost leadership1 %i(
%igma can 'e focused to improve internal processes1 yields1 productivity1 eliminate comple(ity1 reduce cycle time and in
general help gain or maintain lo$ cost supplier position for your particular product or service. *f your strategy includes
'eing the lo$est price in the mar+et your costs had 'etter 'e the lo$est.
%i( %igma also should 'e an integral part of any customer loyalty strategy. "ne of the +eys to customer loyalty is providing
the customer $ith products and services that meet or e(ceed their e(pectation every time. ,very transaction and interaction
'et$een a customer1 or potential customer1 is an opportunity to meet or fail to meet that specific customers e(pectations.
5e$ systems are good enough to offer the desired level of product or service on a consistent 'asis to +eep loyal customers
$ithout some constant attention and $or+. The tremendous 'enefits from having loyal customers can not 'e overstated.
Eac+ #elch has 'een Cuoted as saying that only $hen G,As %i( %igma efforts started focusing on the e(ternal customers did
they 'egin to really see the 'enefits.
#=< '5;er9ior Training
Many Cuality managers have read a'out and seen the 'enefits of %i( %igma 'ut are unsure ho$ to approach their senior
leadership a'out the opportunity 'ecause they do not have a concise pac+age of information to convey. 5ortunately1 there is
a series of tried and true steps $hich can 'e ta+en to sell management on the 'enefits of %i( %igma. These are the steps
'lazed 'y pioneering Cuality professionals $ho successfully sold management on the methodology and eventually deployed
an effective %i( %igma program.
#>< Generate '5taine& '566e
Eohn /ham'ers1 /," of /isco %ystem1 the net$or+ing eCuipment po$erhouse thatJs 'een one of the fastest gro$ing
companies of the past decade1 recently commented on the tenuous hold many companies have on their success. HThere is
the realization that you can 'e out of 'usiness in there yearsI. The only $ay to continue dou'le digit gro$th and retain a
hold on shifting mar+ets is to constantly innovate and rema+e the organization. The %i( %igma creates the s+ill and culture
for constant revival.
#$< 'et a Performan6e Goa: for E9er8one
*n a company of any size getting everyone $or+ing in the same direction and focusing on a common goal is pretty tough.
,ach function1 'usiness unit1 and individual has different o'jectives and targets. #hat everyone has in common1 though1 is
the delivery of products1 services1 or information to customers.
%i( %igma uses that common 'usiness frame$or+ N the process and the customer N to create a consistent goal& %i( %igma
performance or a level of performance thatJs a'out as close to perfect as most people can imagine. ny one $ho
understands their customersJ reCuirements can assess their performance against the %i( %igma goal ==.===B percent
HperfectI!a standard so high that it ma+es most 'usinessesJ previous vie$ of He(cellentI performance loo+ pretty $ea+.
Belo$ figure contrast the num'er of pro'lems that $ould 'e found $ith a goal of == percent Cuality versus a goal of si(
sigma performance :==.===B percent; the difference is pretty startling.
Performan6e Goa: C +hat .o51& Get
For e9er8 D""(""" :etter &e:i9ere& :
#ith ==@ #ith %i( %igma
4>>> miss deliveries ) miss delivery
O5t of e9er8 >""(""" 6om;5ter retart :
#ith ==@ $ith %i( %igma
61)>> crashes V3 crashes
For >"" 8ear of )onth an& C:oing :
8> Months $ould not 'alance .>)? $ould not 'alance
For e9er8 Bee? of T* Aroa&6ating E;er 6hanne: F
).8? Drs of Dead air ).? seconds of dead air
#%< Enhan6e *a:5e to C5tomer
#hen G, 'egan its %i( %igma effort1 e(ecutive admitted that the Cuality of the companyJs products $as not $hat it should
'e. Though its Cuality $as perhaps 'etter than that of its competitors1 Eac+ #elch stated that H$e $ant to ma+e our Cuality
so special1 so valua'le to our customers1 so important to their success that our products 'ecome their only real value
choice.I #ith tighter competition in every industry1 delivering just HgoodI or Hdefect freeI products and service $onJt
guarantee success. The focus on customers at the heart of %i( %igma means learning $hat value means to customers :and
prospective customers; and planning ho$ to deliver it to them profita'ly.
#,< A66e:erate the Rate Of Im;ro9ement
MotorolaJs goal of H)>>U improvement in 6 yearsI set an e(ample for im'i'itions1 driven organization to emulate. #ith
information technology setting the pace 'y dou'ling its performance to cost ratio every )? months1 the customer
e(pectation for improvement gets ever more demanding. The competitor $ho improves the fastest is li+ely to $in the race.
By 'orro$ing tools and ideas from many disciplines1 %i( %igma helps a company not only improve performance1 'ut
improve performance.
#4< Promote Learning An& GCro/Po::inationG
The )==>s sho$ the 'irth of the Hlearning "rganization1 a concept that appeals to many 'ut seems hard to put into action.
llied %ignal leaders have commented that H,veryone tal+s a'out learningK fe$ succeed in $eaving it into the fa'ric of
everyday life for so many employees.I %i( %igma is an approach that can increase and accelerate the development and
sharing of ne$ ideas through out an organization. ,ven in a company as diverse as G,1 the value of %i( %igma as a learning
tool is seen as critical. %+illed people $ith e(pertise in processes $ho to mange and improve them can 'e shifted from1 say1
G, Plastics1 G, capital1 not only $ith shorter learning curve 'ut actually 'ringing $ith them 'etter ideas and the a'ility to
apply them more Cuic+ly. *deas can 'e shared and performance compare more readily. G,Js vice president for %i( %igma1
Piet van 'eelen1 has noted that in the past1 a manger in one part of the organization could discount input1 counter part in
another area& HLour ideas $onJt $or+1 'ecause * am different.I Oen 'eelen says %i( %igma eliminates those defenses & H
#ell1 cry me a river. The commonalities are $hat mater. *f you ma+e the metrics the same $e can tal+.
!"< E7e65te 'trategi6 Change
*ntroducing ne$ products1 launching ne$ ventures1 entering ne$ mar+ets1 acCuiring ne$ organizations! $hat $ere once
occasional 'usiness activities are no$ daily events in many companies. Better understanding of your companyJs processes
and procedures $ill give you a greater a'ility to carry out 'oth the minor adjustments and the major shifts that 3)st century
'usiness success $ill demand.
Do1 an& Don1t of 'i7 'igma
Do N Base your improvement project selection on solid criteria.
Balance result1 feasi'ility1 and organizational impact issues. Good project section can 'e a +ey to early success.
Do N Balance efficiency/ cost!cutting $ith e(ternally N focused1 customer value project.
The Hcustomer!focusI theme is a source of %i( %igmaJs strength. Putting your energies into short term saving only sends
the $rong signal and reduces your chance of 'oosting customer satisfaction and loyalty.
Do N Prepare for an effective HhandoffI to the improvement team.
techniCue li+e the project rationale can give a good start to a project defining clear issue and o'jective.
DonJt N /hoose too many project.
*mprovement ta+es care and feeling on the part of leaders and He(pertI especially at the 'eginning. *tJs tempting to
overe(tend your resources and capa'ilities.
DonJt N /reate H$orld hungerI projects.
,ven more common than Htoo manyI is Htoo 'igI 'etter to get a too small project done more Cuic+ly as long as the result
are meaningful than to have a too 'ig project drag on for months.
DonJt ! fail to e(plain the reasoning for the projects chosen.
,veryone has pro'lems they thin+ should 'e top priority. ,nsuring support for the one you choose means providing a good
rationale for your priorities.
Ke8 Con6e;t of 'i7 'igma
t its core1 %i( %igma revolves around a fe$ +ey concepts.
Criti6a: to 25a:it8: ttri'utes most important to the customer
Defe6t: 5ailing to deliver $hat the customer $ants
Pro6e Ca;aAi:it8: #hat your process can deliver
*ariation: #hat the customer sees and feels
'taA:e O;eration: ,nsuring consistent1 predicta'le processes to improve $hat the customer sees and feels
Deign for 'i7 'igma: Designing to meet customer needs and process capa'ility %i( %igma focuses first on reducing
process variation and then on improving the process capa'ility. /ustomers value consistent1 predicta'le 'usiness processes
that deliver $orld!class levels of Cuality. This is $hat %i( %igma strives to produce.
DF'' N :Design for %i( %igma; is a systematic methodology utilizing tools1 training and measurements to ena'le us to
design products and processes that meet customer e(pectations and can 'e produced at %i( %igma Cuality levels.
D)AIC N :Define1 Measure1 nalyze1 *mprove and /ontrol; is a process for continued improvement. *t is systematic1
scientific and fact 'ased. This closed!loop process eliminates unproductive steps1 often focuses on ne$ measurements1 and
applies technology for improvement.
'i7 'igma N vision of Cuality $hich eCuates $ith only 4.6 defects per million opportunities for each product or service
transaction. %trives for perfection.
#< 25a:it8 Too:
ssociates are e(posed to various tools and terms related to Cuality. Belo$ are just a fe$ of them.
Contro: Chart N Monitors variance in a process over time and alerts the 'usiness to une(pected variance $hich may cause
defects.
Defe6t )ea5rement N ccounting for the num'er or freCuency of defects that cause lapses in product or service Cuality.
Pareto Diagram N 5ocuses on efforts or the pro'lems that have the greatest potential for improvement 'y sho$ing relative
freCuency and/or size in a descending 'ar graph. Based on the proven Pareto principle& 3>@ of the sources cause ?>@ of
any pro'lems.
Pro6e )a;;ing N *llustrated description of ho$ things get done1 $hich ena'les participants to visualize an entire process
and identify areas of strength and $ea+nesses. *t helps reduce cycle time and defects $hile recognizing the value of
individual contri'utions.
Root Ca5e Ana:8i N %tudy of original reason for nonconformance $ith a process. #hen the root cause is removed or
corrected1 the nonconformance $ill 'e eliminated.
'tatiti6a: Pro6e Contro: N The application of statistical methods to analyze data1 study and monitor process capa'ility
and performance.
Tree Diagram N Graphically sho$s any 'road goal 'ro+en into different levels of detailed actions. *t encourages team
mem'ers to e(pand their thin+ing $hen creating solutions.
!< 25a:it8 Term
B:a6? Be:t N 0eaders of team responsi'le for measuring1 analyzing1 improving and controlling +ey processes that influence
customer satisfaction and/or productivity gro$th. Blac+ Belts are full!time positions.
Contro: N The state of sta'ility1 normal variation and predicta'ility. Process of regulating and guiding operations and
processes using Cuantitative data.
CT2: Criti6a: to 25a:it8 ECriti6a: G.GF N ,lement of a process or practice $hich has a direct impact on its perceived
Cuality.
/ustomer .eeds1 ,(pectations N .eeds1 as defined 'y customers1 $hich meet their 'asic reCuirements and standards.
Defe6t N %ources of customer irritation. Defects are costly to 'oth customers and to manufacturers or service providers.
,liminating defects provides cost 'enefits.
Green Be:t N %imilar to Blac+ Belt 'ut not a full!time position.
)ater B:a6? Be:t N 5irst and foremost teachers. They also revie$ and mentor Blac+ Belts. %election criteria for Master
Blac+ Belts are Cuantitative s+ills and the a'ility to teach and mentor. Master Blac+ Belts are full!time positions.
*arian6e N change in a process or 'usiness practice that may alter its e(pected outcome.
Theme of 'i7 'igma
Lou are the /hief 0earning "fficer at ULW /ompany. Lou are implementing %i( %igma and youJre ready. LouJve gone to
the e(perts1 tal+ed to vendors1 and put together a training strategy that should have your ne$ Blac+ Belts1 Green Belts1
Master Blac+ Belts1 /hampions1 and managers up and running in no time.
.ot only $ill the teams 'e trained in %i( %igma methods and statistical techniCues1 'ut they $ill also get training in project
management1 'usiness analysis1 and team 'uilding. LouJve loo+ed at mentoring1 staff development1 and change
management1 and have 'uilt these elements into your training programs as $ell.
Months go 'y. The OP of Manufacturing for sia -egion receives a 4!inch 'inder $ith the title H%i( %igma
-ecommendations.I De scans the report1 canJt find anything interesting and gets interrupted 'y his Director of Suality $ho
says that 0ine is do$n. The report sits on the OPJs des+ for a $ee+ and then gets moved to a 'oo+shelf. T$o months later
the /"" calls him1 H* just got a report from the /5" that says that your plants have ignored one of the critical %i( %igma
recommendations outlined in the report that you got a long time ago. The /," is furious1 'ecause it loo+s li+e $e arenJt
serious a'out change.I De $ants to +no$ $hy the OP of Manufacturing ignored the report.
*n reality1 the recommendation $as hidden $ithin the 'inder. *t $as presented in a $ay that $ould have ta+en him days to
figure out and longer to implement. nd to understand it1 he $ould have had to also HunderstandI dozens of other
recommendations that he $ould have found $ere totally irrelevant to his area. De had tried scanning the document and had
$anted to find the information that could help1 'ut he couldnJt get through the sea of irrelevant information. Dad he found
it1 he also $ould have found that the recommendations for improvement $ere not presented in a $ay that $ould permit
efficient implementation.
%o1 $hat could possi'ly 'e missing from your %i( %igma training strategyG The chances are youJve missed one of the most
critical success factors for any Cuality or productivity initiative& communication s+ills training. %i( %igma1 li+e *%" =>>>
and TSM1 $ill fail $ithout a relentless organizational focus on information and communication.
A&&ing 'i7 'igma to the Comm5ni6ation )i7
%i( %igma initiatives $ill reCuire you to significantly increase the Cuality and Cuantity of communication $ithin your
organization. But letJs face it1 most organizations are already struggling $ith communications that are unfocused and
difficult to read1 $ith 'uried +ey points in endless lines of irrelevant information. The num'er of poorly $ritten e!mail
messages1 reports1 and proposals that come across their des+s each day already over'urdens managers. nd $or+ers already
have difficulty interpreting all of the complicated policies1 processes and procedures they are supposed to follo$. dding
%i( %igma ideas1 reports1 proposals1 solutions1 project updates1 and process changes to the mi( $ill only add to the
pro'lem!!unless they are presented in a clear1 effective $ay that highlights +ey points and allo$s readers to Cuic+ly access
and understand the information they need.
dopting organization!$ide communication standards1 methods1 and protocols1 and adding communication s+ills training
to the %i( %igma curriculum $ill help %i( %igma teams communicate and sell their ideas1 plans1 and solutions internally1
$ill ma+e life easier for over'urdened managers1 and $ill su'stantially increase a projectJs li+elihood of success.
Comm5ni6ation an& the Theme of 'i7 'igma
ccording to %i( %igma e(perts Pande and Dolpp in their 'oo+ H#hat is %*U %*GMGI there are si( themes of %i( %igma.
,ach of the themes reCuires a relentless focus on clear1 concise communication.
Theme One: Fo65 on the C5tomer

%avvy companies have proven over the past decade that e(cellence starts $ith an accurate understanding of customer needs
and the a'ility and commitment to meet those needs. chieving this o'jective in a %i( %igma environment reCuires strong
communication $ith customers1 as $ell as the a'ility of salespeople1 -XD1 and mar+eting to clearly capture and
communicate customer needs and desires to others $ithin the organization.
Do$ good is your sales force at accurately descri'ing your productJs features1 'enefits and implementation process to
customersG Do$ good is your sales force at conveying real customer needs 'ac+ into your /ompanyG Do$ good is your
operations group at communicating out to the customerG *f you are li+e most organizations1 youJve spent very little time
and effort thin+ing a'out ho$ to improve these communications1 'ut a H5ocus on the /ustomerI demands more than
H'usiness as usualI communication effectiveness.
Theme TBo: Data/ an& Fa6t/Dri9en )anagement
"ne of the primary differences 'et$een %i( %igma and other Cuality initiatives is the relentless focus on data. Much of the
po$er of the %i( %igma process comes from its avoidance of speculation and conversation in favor of tests and
measurements. Graphs and charts are often touted as the language of %i( %igma N and they are important N 'ut it is eCually
important that %i( %igma teams $rap their charts and graphs in clear1 effective communications that ma+e sense of the data
and their interpretations and solutions. This result can only 'e accomplished if the people preparing the statistics N and their
managers N can communicate effectively.
Theme Three: Pro6ee are +here the A6tion I
%i( %igma projects usually focus on +ey processes and ho$ to improve them. *n most companies1 process1 procedure and
guideline information is poorly $ritten. %ince processes typically involve many departments and many people1 even a small
change can have a huge impact on an organization. Providing clear1 effective communications a'out $hat is changing and
$hy is essential to ensuring that project o'jectives are met and changes are replicated consistently throughout the
organization. Providing communication s+ills training that helps %i( %igma teams and others throughout the organization
learn to communicate ne$ policies1 processes1 and procedures clearly and effectively $ill help support your %i( %igma
initiative and have a positive long!lasting impact on employee performance.
Theme Fo5r: Proa6ti9e )anagement
%i( %igma produces many organizational changes. "'viously1 you $ant the right changes to happen in 'oth evolutionary
and revolutionary $ays. /hange involves various levels of an organization and many different functions. To 'e successful1
the need for change and the type of change needs to 'e communicated clearly. *n short1 there needs to 'e a focus on getting
the right information to the right people at the right time in the right form so that they can ma+e good decisions and ta+e
effective action. /lear1 effective communication is essential to successful change management.
Theme Fi9e: Bo5n&ar8 :e Co::aAoration
Glo'al corporations have their important activities located throughout the $orld. Processes often cross!organizational as
$ell as geographic 'oundaries. %i( %igmaJs relentless focus on process and 'usiness results forces staff to $or+ together
across departments and organizational 'oundaries. %i( %igma teams are li+ely to meet challenges and resistance $hen they
enter ne$ territory and inadvertently Hstep on toes.I Translation can 'e a +ey issue. Translation effectiveness and cost is
improved $ith $ell!structured communication. The $ritten and spo+en communication s+ills of your %i( %igma teams
must 'e strong enough to 'rea+ do$n organizational $alls or your %i( %igma effort $ill fail.
Theme 'i7: Dri9e for Perfe6tionH To:erate Fai:5re
*t may sound easy to Hdrive for perfection1 'ut tolerate failure1I 'ut it is not. 5ailure is tough. *t is often complicated and
difficult to e(plain in a non!threatening $ay. Poor communication around failures lessens the opportunity to prevent the
failure from happening again. Teams must 'e a'le to clearly communicate $hat happened1 $hy it happened1 and $hat they
can learn from the e(perience to help ensure that the ne(t project is a success. "nce again1 $ithout effective communication
s+ills1 it can 'e difficult to survive and thrive in a perfection!driven environment.
%erviceMaster /ase %tudy& *mproved /ommunication 5uels %i( %igma -esultsThe %erviceMaster /ompany provides
various services to residential and commercial customers in the 2nited %tates $here it serves )>.7 million homes and
'usinesses each year. /ore service capa'ilities include la$n care and landscape maintenance1 termite and pest control1
plum'ing1 heating and air conditioning maintenance and repair1 appliance maintenance and repair1 cleaning and furniture
maintenance and home $arranties. These services are provided through a net$or+ of over 716>> company!o$ned and
franchised service centers and 'usiness units. *n 3>>)1 %erviceMaster committed to 'ringing its Cuality and customer
service to a higher level through %i( %igma. H#e $ere service leaders and $anted to continue to lead in our chosen
mar+etsI e(plains Eohn Biedry1 %r.OP of /ontinuous *mprovement and %i( %igma. #e sa$ the opportunity to differentiate
our services 'y improving the processes that touch our customers every day. %erviceMasterJs %i( %igma program is driven
'y 77 'lac+ 'elts and 8 deployment champions. Their jo' is to drive each %i( %igma solution across hundreds of locations.
Multiple solutions add up to thousands of replications in %erviceMaster and ma+es for a formida'le communications
challenge. %erviceMaster $as having difficulty actually implementing recommended process changes1 'ecause
documentation regarding ne$ processes $as hard to understand and difficult to use. %taff $as frustrated and it $as ta+ing
too long to realize the e(pected 'enefits from process improvement. #ith /," support and commitment for the entire
effort1 %erviceMaster recognized that effective communication $as essential for true success. 0oo+ing for a solution1
%erviceMaster discovered a research!'ased methodology called *nformation Mapping that helped authors to analyze1
organize and present information so that it $as easier to understand and use. %erviceMaster adopted *nformation MappingJs
methodology as a standard in order to
increase the speed of replication of process improvement
enhance the sharing of information across departments and geographies
improve the a'ility of our staff to Cuic+ly find information and adopt ne$ processes1 and
improve the reada'ility of important documents.
The result has 'een Cuic+er implementation and a 'etter return on *nvestment from our %i( %igma program. *nformation
Mapping is no$ a core element of the 'lac+ 'elt training curriculum and has 'ecome the standard for 00 %i( %igma
solutions that $ill 'e communicated to the field.
The 'i7 'igma Roa&ma;
The ideal -oadmap for esta'lishing the %i( %igma system is as follo$s.
*dentify core processes and +ey customer
Define customer reCuirements
Measure current performance
Prioritize1 analyze and implement improvements.
,(pand and integrate the %i( %igma system.
A&9antage of the 'i7 'igma Roa&ma;
The -oadmap is not the only path to %i( %igma improvementK you $ill very li+ely need to adjust the order of these steps1 or
even start more than one of the simultaneously. *n part $eJll loo+ at $ays to adapt the -oadmap1 'ased on your
organizationJs specific needs and goal. #hat ma+es this path HidealI ho$ever1 is that1 ta+en in this order1 these activities
'uild up the essential foundation that $ill then support and sustain %i( %igma improvement. %pecifically1 the -oadmapJs
advantages include&
clear understanding of the 'usiness as an interconnected system of processes and customer.
Better decision and uses of resources1 to get the greatest possi'le amount of 'enefit out of %i( %igma improvements.
%horter improvement cycle times1 than+s to 'etter upfront data and selection of project.
More accurate validation of %i( %igma gains N $hether in dollars1 defected1 customer satisfaction1 or other
measures.
stronger infrastructure1 to support change and sustain results.
'i7 'igma 25a:it8 Too: an& Tem;:ate
ffinity Diagram
Brainstorming
/alculators
/ause X ,ffect / *shi+a$a / 5ish'one
/harters
/ontrol /harts
/ontract Management %oft$are
/reativity / "ut of the Bo( Thin+ing
Design "f ,(periment
Document /ontrol
5lo$ /hart / 5lo$ /harting
5M, / -is+ ssessment
Glossaries
Distogram
Kano nalysis
"rganizing Data
"nline %tatistics Te(t'oo+s
Pareto
Po+a Lo+e :Mista+e Proofing;
Process Map / Process Mapping
Project /harters
Suality 5unction Deployment / Douse of Suality
%catter Diagram / Plot
%*P"/ Diagram
%oft$are
%upport and -estraint
%urveys :Y;
Thin+ing "ut "f The Bo(
5e$ of the a'ove is as follo$s
I 'i7 'igma Right for U NoB 0
Aeing .o5r 'i7 'igma Rea&ine
*n its most am'itious application1 %i( %igma can 'e a more fundamental change than1 say1 a major acCuisition or a ne$
system implementations1 'ecause %i( %igma affects ho$ you run the 'usiness. The depth of impact on your management
processes and s+ills $ill vary1 of course1 $ith ho$ e(tensively you $ant to apply %i( %igma tools and the results you are
see+ing.
The starting point in gearing up for %i( %igma is to verify that you are ready to or need to em'race a change that says
HThere is a 'etter $ay to run our organization.I This should not 'e a rote1 num'er crunching 'ased decision1 'ut there are a
num'er of essential Cuestions and facts you $ill have to consider in ma+ing your readiness assessment.
Ae the O5t:oo? an& F5t5re Path of the B5ine
first step is a general revie$ of the condition of your organization today and its outloo+ for the future1 'oth in the short
and the long term. Key Cuestions include&
*s the strategic course clear for the companyG
re our chances good for meeting our financial and gro$th goalsG
*s the organization good at responding effectively and efficiently to ne$ circumstancesG
E9a:5ating .o5r C5rrent Performan6e
,ven if the Hfuture is so 'right you got to $ear shades1I e(isting pro'lems increase the potential value of a %i( %igma
effort. %i( %igma ma+es it easier to 'e more concrete in an assessment of $here you are todayK and the more you can use
hard data to ans$er the follo$ing Cuestions1 the 'etter&
#hat are our current overall 'usiness resultsG
Do$ effectively do $e focus on and meet our reCuirementsG
Do$ effectively are $e operatingG
+hat the anBer mean 0
There are actually several conclusions you can dra$ from this current performance assessment.
*s there enough room for improvement to ma+e %i( %igma $orth$hileG
#here are the 'est opportunities for improvementG
Do$ effective are our customer +no$ledge and measurement systemsG
Re9ieBing '8tem an& Ca;a6it8 for Change an& Im;ro9ement
third major factor in deciding $hether to launch %i( %igma is the organizationJs e(isting improvement processes and
its a'ility to underta+e a ne$ initiative1 Suestions here include the follo$ing&
Do$ effective are our current improvement and Hchange managementI systemsG
Do$ $ell are our cross!functional processes managedG
#hat other change efforts or activities might conflict $ith or support a %i( %igma initiativeG
+hat the anBer mean 0
The purpose of this third assessment element is to test the timing and readiness of the 'usiness for a possi'le %i( %igma
effort. ,ven if assessment factors ) and 3 ma+e a strong case to initiate %i( %igma1 your 'usiness may already 'e capa'le of
dealing $ith the challenges. "r your people1 systems and resources may already 'e $rapped up in ma+ing other efforts or
changes in $hich case youJd have trou'le ma+ing the commitment of leadership1 time1 energy and money that a %i( %igma
effort demands.
+hen 'i7 'igma i Not Right for an OrganiIation
%i( %igma can 'e applied as a targeted approach1 so a limited implementation may al$ays 'e feasi'le. .evertheless1 $e can
loo+ at the flipside of the preceding assessment to identify conditions in $hich it pro'a'ly $ould 'e 'est to say H.o than+sI
for %i( %igma efforts. /onditions that might indicate a Hno!goI decision on %i( %igma include the follo$ing&
Lou already have in place a strong1 effective performance and process improvement effort. *f there are systems and
tools in place to support ongoing pro'lem solving and process design/redesign1 %i( %igma may not add much value
and might even confuse people.
/urrent changes already are over$helming your people and/or resources. n organization can handle only so much
turmoil at once. 0umping %i( %igma on top of one or other major 'usiness upheavals could prove to 'e the prover'ial
stra$ on camelJs 'ac+. Do$ever1 'e$are of ma+ing the H$e are too 'usyI argument N a copout for never doing the
tough $or+ it ta+es to 'ecome a truly $orld class organization.
The potential gains are not there. %i( %igma demands an investment. *f you canJt ma+e a solid case for future or
current return1 it may 'e 'est to stay a$ay at least until you have figured out e(actly ho$ and $hen it might pay off.
'5mmariIing the Aement: Three Ke8 25etion
t the end of a revie$ of your 'usiness1 including its future and current state1 and its organizational factors1 the o'jective is
to decide H%hould $e ta+e on or at least seriously consider a %i( %igma initiative for our organizationGJ $e can 'oil all the
specifics do$n to three Cuestions1 as follo$s&
*s change a critical 'usiness need no$1 'ased on 'ottom!line1 cultural or competitive needs.
/an $e come up $ith a strong strategic rationale for applying %i( %igma to our 'usinessG
#ill our e(isting improvement systems and methods 'e capa'le of achieving the degree of change needed to +eep us a
successful competitive organizationG
*f your ans$ers are Les1 Les and .o1 you may $ell 'e ready to e(plore further ho$ to adopt %i( %igma in your
organization.
'i7 'igma Training
%i( %igma Training is one of the most important factors that contri'utes to and helps modify and shape an organizationAs
culture. This article $ill help identify $ho in your organization is reCuired to 'e %i( %igma trained and $hat type of %i(
%igma training they should receive.
+ho an& +hat T8;e of Training 0
#< 'enior )anagement
%enior Management1 also +no$n as A/!0evel ManagementA :/,"1 /*"1 /5" and peers;1 are the individuals that set1
communicate and drive the overall 'usiness o'jectives. They are also the individuals that are reCuired to incorporate %i(
%igma o'jectives into their operational plans. ,(amples of o'jectives might include&
U@ of employees through %i( %igma training 'y a certain date
L@ reduction in defects for all customer visi'le processes 'y Cuarter end
ZW in 'ac+!office projects savings 'y year end
%i( %igma training for %enior Management should include a program overvie$1 'usiness and financial 'enefits of
implementation1 real!$orld e(amples of successful deployments1 specific application to 'usiness/industry1 and the reCuired
%i( %igma training and tools to ensure successful implementation. Depending on %enior Management time availa'ility and
their desire to learn the details1 Blac+ Belt training is also recommended.
!< F5n6tiona: @ Pro6e )anager
5unctional and Process Managers are the level of management directly reporting to the %enior Management. Depending on
the size of the organization1 they might include functional managers from areas such as human resources1 finance and
training1 and process managers from areas such as assem'ly1 production and call center.
These managers are sometimes referred to as AsponsorsA and AchampionsA 'ecause they are +no$n to champion the cause
$ithin their 'usiness organization. These champions translate %enior ManagementAs strategic directions into tactical
o'jectives and actions $ith the help of their Suality 0eader and Project 0eaders.
%i( %igma training for 5unctional and Process Managers is more detailed than that provided to %enior Management. Topics
$ould include the %i( %igma concept1 methodology1 tools and reCuirements to ensure successful implementation $ithin
their organization. Depending on 5unctional / Process Manager time availa'ility and their desire to learn the details1 Blac+
Belt training is also recommended.
D< 25a:it8 Lea&er
Suality 0eaders1 also +no$n as Suality Managers and Master Blac+ Belts1 help 5unctional and Process Managers set and
lead the %i( %igma vision $ithin their specific areas. They maintain rolled up 'udgets1 trac+ 'usiness cost savings1 ensure
training goals are met1 coach 5unctional and Process Managers1 Project 0eaders and ,mployees1 revie$ projects at
milestones1 share 'est practices1 and ensure appropriate use of tools and methodologies.
%i( %igma training for Suality 0eaders includes detailed information a'out the concept1 methodology and tools1 as $ell as
detailed statistics training and computer analysis tool use. Depending on the instructor1 the duration is usually 'et$een three
and four $ee+s.
=< ProJe6t Lea&er
Project 0eaders1 also +no$n as Blac+ Belts1 implement the %i( %igma methodology and tools $ithin the 'usiness. They
lead the intra! and inter!function projects1 maintain time lines and 'udget1 determine appropriate tool use1 perform analyses1
and act as the central point of contact for specific process improvement projects.
%i( %igma training for Project 0eaders includes detailed information a'out the concept1 methodology and tools. Depending
on the instructor1 the duration is usually 'et$een t$o and four $ee+s1 and may include one of more $ee+s in 'et$een
sections. %tatistics is included in the agenda1 'ut typically does not include as much detail as that provided to Suality
0eaders.
>< Em;:o8ee
,mployees1 also +no$n as Green Belts1 may also ta+e %i( %igma training courses developed specifically for part time
Project 0eaders. %i( %igma training for Green Belts is similar to Blac+ Belt training1 'ut shorter in duration 'ecause less
detail on comple( tools and statistics is provided. ,mployees are instead told to as+ their Blac+ Belt for help in specific
areas.
Training the OrganiIation for 'i7 'igma
%i( %igma is essentially a comprehensive yet fle(i'le system for achieving1 supporting1 and ma(imizing 'usiness profits. *t
is a methodology driven 'y understanding customer needs1 and the disciplined use of data1 facts1 and statistical analysis to
improve and reinvent organizational processes.
%o $hat does this really meanG Do$ is it deployedG Do$ can it 'e 'est employed for ma(imum advantage $ithin your
organizationG
The %i( %igma Training and Suality Tool+it is designed to help address all these issues and more. *t contains a $hole
series of resources to help e(plain1 simplify1 and set you on the right path to implementation of %i( %igma.
#< The 'i7 'igma 25a:it8 )anagement Kit
,ach item is of the highest Cuality1 tailor made to cover a different aspect and issue. *t includes presentations1
Cuestionnaires1 fact sheets1 guidelines.... a $hole range of materials specifically put together to 'oth introduce1 and ta+e you
through1 %i( %igma. 2nless other$ise stated1 each element is provided in M%!#ord format for fle(i'ility1 control and ease
of use. The +it includes the follo$ing&
!< A 'i7 'igma Beginner G5i&e
This is a comprehensive introduction to1 and overvie$ of1 %i( %igma. *t e(plains the concepts1 the statistical practicalities1
the training regime1 and much more.
D< A )anagement Preentation
This Po$erPoint presentation is designed to e(plain the +ey concepts and 'enefits to management/e(ecutives and provide
guidance on ho$ to avoid the common pitfalls.

=< The 'i7 'igma Ca:65:ator
This simple to use 'ut po$erful ,(cel 'ased calculator allo$s you to enter values into cells and see the eCuivalent %i(
%igma result.
>< The 'i7 'igma Fa6t 'heet
This is a most concise summary of the %i( %igma method and process and is a handy reference guide for everyday use. *t
includes e(planations of& $hy it e(ists1 the sigma o'jectives1 the statistical 'asis :in easy to understand language;1 the
certifications1 and ho$ to use it to improve.
$< The 'i7 'igma Training T5toria:
This e(tensive document is nothing short of a full tutorial on the topic. %ections include& The Distory of %i( %igmaK %i(
%igma /osts and %avingsK #hat is %i( %igmaGK /ritical to SualityP/TSK #hy is DM*/ %ignificant in %i( %igmaGK
Benefits of *mplementing %i( %igmaK #ho re the %i( %igma PractitionersGK Design for a %i( %igma -oadmap.

%< A ReK5irement Tem;:ate
"ne of the most important aspects in underta+ing any major initiative is to understand $hat the reCuirements for the
initiative are. This e(cellent template document is designed specifically to assist $ith this tas+.

,< The 'i7 'igma LTo; DoBnL NoteAoo?
This document is designed to e(plain ho$ to approach %i( %igma $ithin an organization. *t offers guidelines for a top!
do$n approach1 presented in a colorful and pleasing manner.
4< A 'i7 'igma +or?ho; Preentation
This is a full and detailed presentation1 giving a detailed appreciation of %i( %igma for the practitioner. *t includes 'oth
spea+er notes and e(ercises.

#"< 'i7 'igma an& ITIL EIt Infratr56t5re LiArar8F
#ithin *T1 *T*0 has emerged to define 'est practice through a detailed set of processes. s there is sometimes seen to 'e
considera'le theoretical commonality $ith %i( %igma1 this su'stantial document is included for those specifically
considering *T.
s a 'onus1 an *T*0 assessment +it is also included. This comprises a detailed ,(cel Cuestionnaire and scoring mechanism.

Large organiIation that ha9e a&o;te& i7 igma
These are some the large *ndian and *nternational organizations that have used %i( %igma. There are thousands more all
over the $orld.
D)
AB Di6?
A&o:;h Coor
A&9an6e& )i6ro
De9i6e
A::ie& 'igna:
A:6oa
Aero;;a6e Cor;
AAAott LaA
A;;:e Com;5ter
Ban? of U'A
Beatri6e Foo&
Be:: He:i6o;ter
Boeing
Brito: )8er 'K5iAA
Cit8 of Da::a
Cam;Ae:: 'o5;
Che9ron
Citi6or;
C:oro7
Danon
DoB
Fi&e:it8
Inte:
For&
Genera: D8nami6
GE
HP
Hone8Be::
Kaier A:5mini5m
Info8
Kraft Genera: Foo&
Lear Atroni6
Lo6?hee& martin
)6Donne:: Do5g:a
)i6rooft
)otoro:a
NA'A
Northro; Cor;
Pentagon
Par?9ieB Ho;ita:
Ro6?Be:: Int
Rohm an& Haa
ICICI
HDFC
+i;ro
'eagate
'on8
'tar 25a:it8
Te7a6o
Te7a Intr5ment
TR+
U' Arm8
U' Air For6e
Unite& Te6hno:ogie
UP'
-ero7
Airte:
Bharti
TATA
Re:ian6e
TC'
Ue 'i7 'igma Too: to )eet I'O 4""" ReK5irement
"ne of the major differences 'et$een 'oth systems is that *%" =>>> is a shell of reCuirements $ithout any tools1 $hereas
%i( %igma is a methodology connecting tools and procedures for applying these tools through a 9red thread.9 -eCuirements
of *%" =>>>&3>>> are1 for e(ample&
Define Cuality management information needs
/ollect Cuality management system data
Provide Cuality management information
*mprove Cuality management system
Tools provided 'y %i( %igma to meet these reCuirements are1 for e(ample&
Dash'oards as a set of +ey performance indicators to monitor all processes at a reasona'le degree for all relevant
managerial levels.
"perational definitions to descri'e e(actly ho$1 $hen1 $here1 $ith $hich tools1 'y $hom1 ho$ often and ho$ much data
should 'e collected. dditionally1 %i( %igma provides tools to address such Cuestions as sample size and precision as $ell
as capa'ility1 repeata'ility and reproduci'ility of data collection.
Data displays to help dra$ 'usiness!relevant conclusions and tests to justify the significance of conclusions dra$n from
data collected.
D)AIC: Define!Measure!nalyze!*mprove!/ontrol as a methodology for process improvement at a project level1 $hich is
! after necessary customization ! applica'le to all +inds of processes.
Ue the I'O 4""" FrameBor? to Ae a 'i7 'igma '8tem
0oo+ing at the ne$ *%" =>>>&3>>> reCuirements and comparing these reCuirements $ith the self!developed %i( %igma gap!
analysis sho$s the possi'ility of connecting 'oth approaches and systems $ith each other. %i( %igma does not come $ith
the assessment tool per se. This tool needs to 'e added after a certain time frame in order to +eep the 'all rolling and in
order to help %i( %igma get into the companyAs 'loodstream. *%" =>>> is designed to assess companies 'ased on 'oth
e(ternal and internal reCuirements and to help close the gaps on a mid!term and long!term 'asis. By adding typical %i(
%igma reCuirements to the *%" =>>>&3>>> internal audit Cuestionnaires1 a company can ma+e %i( %igma part of its Cuality
management system and improve the effectiveness and efficiency of the %i( %igma initiative significantly. side effect is
that 'oth approaches get aligned and do not compete for resources any longer. %ince the goals of the t$o approaches are the
same1 there is a greater li+elihood of an increase in 'ottom!line and top!line results on a long!term 'asis to increase
customer satisfaction and employee commitment.
Con6:5ion: Im;ro9e Cre&iAi:it8 an& '5tainaAi:it8
*t is a $aste to have a Cuality management system and process improvement approach e(isting side!'y!side $ithout any
integration. ligning *%" =>>> and %i( %igma can help improve the credi'ility of the *%" =>>> Cuality management system
and the sustaina'ility of the %i( %igma initiative at the same time. *t can save resources and investmentsK and it enriches the
$ay to manage the 'usiness.
'i7 'igma an& 25a:it8 )anagement G:oar8
Many of these terms are very specifically related to %i( %igma. "thers are used in a general ACuality managementA conte(t
and also in %i( %igma. s already e(plained1 %i( %igma tends to em'race many other methodologies. fe$ of these terms
are Cuite technical since they occur in the statistical1 engineering and mathematical aspects of %i( %igma. The more
comple( mathematical terms and acronyms are included in this glossary not to provide detailed e(planations1 'ut instead to
ena'le initial recognition and a 'asis for further investigation1 if you are so inclined. This small glossary is not e(haustive
'ecause it $ould ta+e a'out ten years to compile an e(haustive %i( %igma and Suality Management glossary. This is just a
fe$ highlights1 some points of clarification1 $ords of $arning1 items of mild amusement1 and terms of special note. The
really o'vious %TB" terms have not 'een included. *f you need a more detailed listing try the one on the %i( %igma $e'site
$hich could +eep you occupied for days. *f you $ish to nominate an item of %i( %igma or Suality Management
terminology for inclusion here ! especially an amusing or intriguing e(ample ! please send to me. Despite 'eing completely
fascinating of course1 %i( %igma is possi'ly is one of the driest su'jects *Ave ever encountered and so $ill 'enefit from as
much light relief as you can suggest.
A66e;tan6e( an& a66e;taA:e K5a:it8 :e9e: EACLF ! cceptance has at least t$o different meanings in %i( %igma
terminology1 so 'e careful to understand $hich one is 'eing referred to. 5irstly1 acceptance relating to Cuality is the Cuality
e(pectation of the customer1 internal or e(ternal. ccepta'le Suality 0evel :/0; means the same 'asically1 in more
formal %i( %igma!spea+1 and $hich $ill freCuently 'e e(pressed in terms of percentage defects. %econdly acceptance refers
to the 'uy!in or agreement of people affected 'y proposed actions and changes1 nota'ly sta+eholders. #hile not strictly part
of the %i( %igma 'attery of supporting tools1 * can strongly recommend %haron Dre$ MorganJs facilitative communications
concepts for anyone struggling $ith sta+eholder acceptance :and $holesale organizational change as $ell for that matter.;
A6ti9it8 re;ort / simple tool $hich ena'les teams and team leaders to manage project management tas+s1 responsi'ilities
and timescales.
Affinit8 &iagram / diagrammatic method of capturing1 analyzing and organizing lots of ideas1 elements1 activities1 etc.1
that together represent or influence an overall category1 such as a process or issue. The 'rainstorming method is central to
structuring an affinity diagram1 and Apost!itA or stic+y notes are commonly used as a $ay of generating and organizing data.
/ommonly used in 'rainstorming solutions during the *mprove stage of DM*/.
Ana:8i / nalysis of all sorts of data is a critical component $ithin the %i( %igma model1 $hich involves using various
analytical methods to identify and Cuantify the causes of Cuality variation and failure in specific processes. Oarious analysis
perspectives are adopted1 for e(ample&
Di6rete ! loo+ing at a particular failure or pro'lem ! eg.1 using Pareto :A?>&3>A; or pie!charts to sho$ causes 'y percentage
continuous ! mapping performance variation and types1 etc.1 over time1 using distri'ution graphs
Pro6e / creating detailed flo$!diagrams to understand $hatAs really going on in the process or su'!process
."O1 ./"O1 M."O1 M./"O ! Despite first impressions these are nothing to do $ith -ussian gymnastics
or ice!s+ating moves. ."O is an acronym for analysis of variance1 a specialized variation calculation method concerned
$ith comparing means and testing hypotheses1 'est left to engineers and mathematicians. %o are the related methods1
./"O :analysis of covariance;1 M."O :multiple analysis of variance;1 and M./"O :multiple analysis of
covariance;. 2nless you are an engineer or a mathematician you $ill almost certainly have 'etter things to do than get to
grips $ith this level of statistical capa'ility. Terms such as these illustrate $hy $e need to $or+ in multi!disciplined teams.
'alanced scorecard ! sophisticated strategic analysis and improvement methodology developed 'y Kaplan and .orton
$hich in its o$n right can sit outside %i( %igma1 'ut $hich can 'e included $ithin %i( %igma methods1 and in any event
might 'e used or referenced in the conte(t of Cuality and performance improvement. The L'alanced scorecardA identifies1
correlates1 A'alancesA1 measures and drives improvement across a $ide variety of factors that are deemed responsi'le for
overall organizational effectiveness1 and for meeting customer e(pectations. The tool essentially translates strategy into
operational metrics1 and according to Motorola :ie.1 in a %i( %igma conte(t; typically features the perspectives of1 vision1
current initiatives1 'usiness processes1 and 'usiness results. ABalanced %corecardA 'ecame a generic A'randA for 'usiness
improvement in the )==>As1 rather li+e %i( %igma1 although argua'ly not on such a grand scale.
B:a6? Ae:t ! specific %i( %igma term to descri'e a team leader and one $ho has achieved accredited ABlac+ BeltA
Cualification via an appropriate training course.
B:a6? noie@Bhite noie ! Technical terms relating to respectively non!random and random causes of variation.
B5ine im;ro9ement 6am;aign ! Motorola %i( %igma 'uzz!phrase1 $hich represents a leadership initiative to
improve the 'usinessAs A'ig LAsA.
B5ine ;ro6e management ! common generic e(pression in its o$n right1 'ut also a %i( %igma term for the initial
strategic element of %i( %igma. %i( %igmaAs strategic first phase is designed to develop managementAs commitment to %i(
%igma1 and also managementAs active participation in the %i( %igma process :$hich suggests $hy a po$erful 'rand name
for the initiative1 ie.1 %i( %igma1 is helpful..;. This amounts to identifying the +ey processes $ithin the organization that
determine effectively meeting customer e(pectationsK then measuring the effectiveness and efficiency of the processes
:nota'ly measuring variation in Cuality and analyzing the causes;1 and then initiating improvements in the $ea+est
processes1 $hich should logically yield the greatest results and return on effort.
Ca5e/effe6t &iagram ! lso +no$n as the fish'one diagram1 this is a generally used tool for mapping and analyzing
causal factors to$ards an end output1 so that contri'uting factors :and $ea+nesses can 'e more easily identified;. 2sed
especially in %i( %igma as a team 'rainstorming analysis tool. /alled a fish'one diagram 'ecause the diagram plots
contri'uting factors along parallel diagonal lines $hich each join a central horizontal time!line :li+e the 'ac+!'one; $hich
culminates at one end $ith the main issue or Cuestion.
CT2 ! /ritical To Suality ! n element $ithin a process that has a major influence on the process Cuality1 and typically the
Cuality of a critical process1 or it $ould 'e unli+ely to 'e receiving %i( %igma attention.
Defe6t ! vital and generic %i( %igma term for any failure in meeting customer e(pectation :internal and e(ternal
customers; ! any failure $ithin the delivery process.
DF'' ! /ommonly used a''reviation in %i( %igma activities and communications1 it means Design 5or %i( %igma1 and
descri'es the method of using tools1 training1 measurements1 and verification so that products and processes are designed at
the outset to meet %i( %igma reCuirements. more specific version is DMDO& Define1 Measure1 nalyze1 Design1 and
Oerify. Both D5%% and DMOD are concerned $ith1 and emphasise the importance of1 using %i( %igma principles in
product/process design1 not just for remedial improvements ! rather advocating that prevention is 'etter than cure. Thus1 if
%i( %igma capa'ility is 'uilt into ne$ organizational systems and products $hen they are designed1 so performance $ill 'e
'etter1 and the need for %i( %igma remedial effort $ill 'e reduced.
D)AIC@D)AICT ! /entral %i( %igma process and acronym to ensure you remem'er it& Define1 Measure1 nalyse
*mprove1 /ontrol1 more recently e(tended to DM*/T 'y others in the %i( %igma consulting and training communities1 to
Transfer :transfer 'est practice and there'y share learning;.
DMDO ! n alternative/su'stitute a''reviation to D5%% :Design 5or %i( %igma;1 and li+e D5%% DMDO is central to
%i( %igma initiatives. DMDO more specifically descri'es a method comprising lin+ed stepsK Define1 Measure1 nalyze1
Design1 Oerify1 for ensuring that products and processes are designed at the outset to meet %i( %igma reCuirements.
freCuency distri'ution/freCuency distri'ution analysis or chec+sheet ! 5reCuency distri'ution and the chec+sheets and other
freCuency distri'ution measurement tools form an essential aspect of %i( %igma data analysis. *dentifying freCuency of
variation in processes is central to %i( %igma1 since customers are particularly sensitive to variation1 argua'ly even more
than isolated failures. Therefore the sampling and collection of data over many operations and e(tended time periods1 and
the use of this data to indicate the freCuency :num'er of times; that a variation occurs rather than the size of isolated
failures1 is an essential perspective for truly understanding $hatAs happening1 and the causes1 $ithin any critical delivery
process. 5reCuency distri'ution analysis is an e(cellent antidote for any temptation to respond to an isolated failure $ith a
+nee!jer+ Cuic+ fi(1 such as shooting the messenger or 'olloc+ing the $or+ers $hen something deeper in the process is
a$ry.
Green Be:t ! %i( %igma team mem'er $ho has received Green Belt training and $ho $or+s part!time on %i( %igma
projects under the guidance of a Blac+ 'elt team leader.
J5t in Time EJITF ! Eust *n Time1 commonly a''reviated to E*T1 descri'es operational or production methods 'ased on
minimising stoc+ levels1 the aim of $hich is to reduce capital employed in stoc+1 $hich also has +noc+!on 'enefits to
reducing storage space1 decreasing dependence on logistics1 easier supply chain management1 and 'etter overall Cuality.
Eust *n Time is actually a capa'ility arising from improvements $ithin a 'usiness operation1 rather than a cause of
improvement itself. *ntroducing Eust *n Time methods $ithout improving efficiency and relia'ility necessary to support it is
not via'le. %ince Eust *n Time methods entail reducing stoc+ levels to a'solute minimum or even zero1 E*T allo$s no room
for error. Timing and predicti'ility are cruicial. E*T reCuires total commitment to Cuality and efficiency or the supply chain
and related operations 'rea+ do$n1 the costs and implications of $hich can easily e(ceed any savings from E*T stoc+
reductions. The term and methodology $ere developed 'y the Eapanese during their post!$ar industrial revival :second half
of the )=>>s; as a logical progression from Amaterials reCuirements planningA :M-P;. The Eapanese original terminology is
A+an'anA1 and is important $ithin Alean productionA methodology. The aim of +an'an is actually zero inventory. E*T features
in highly efficient manufacturing corporations1 and has more recently 'een significantly ena'led 'y computerization1
especially to analyse and manage timings rather than stoc+ levels. .oted authors to have covered the su'ject include
,d$ards Deming1 Taiichi "hno1 and Lasuhiro Monden. The acronyms page contains a more amusing definition of E*T.
)ater B:a6? Be:t ! highly Cualified %i( %igma practitioner1 typically concerned $ith overseeing %i( %igma activities
from an organizational perspective.
)ateria: ReK5irement P:anning E)RPF ! production Cuality management methodology focusing on planning stoc+
:materials and components of all sorts; levels and availa'ility according to production schedules.
Pareto Prin6i;:e( Pareto Diagram( Pareto Ana:8i ! The Pareto Principle is other$ise and more commonly +no$n as the
?>&3> rule. The Pareto Principle $as named after its originator Oilfredo Pareto1 :)?6?!)=34; an *talian economist and
professor of political economics at 0ausanne 2niversity1 $ho first discovered the ?>&3> AruleA of Apredicta'le im'alanceA1
that :as far as %i( %igma is concerned; provides a 'asis for focusing on the 3>@ of activities that generate ?>@ of results1 or
the 3>@ of failures that are responsi'le for ?>@ of the $aste1 etc. Pareto first made his discovery $hile analysing $ealth
distri'ution among the British1 in )?=B. The Pareto Principle is also +no$n as The Parato 0a$1 The Principle "f 0east
,ffort1 and The Principle "f *m'alance1 $hich in themselves provide an e(ample of the Pareto Principle in action 'ecause
despite all the options1 hardly anyone ever uses any other name than AThe ?>&3> -uleA. More Pareto e(planation and
e(amples in use.
Process ! The $ord process is $orth mentioning 'ecause it is a fundamental cause of confusion :and not just in %i( %igma1
'ut thatAs another story;. The $ord process is used heavily in descri'ing ho$ %i( %igma $or+s1 and itAs also used heavily in
referring to the service or production activities :processes; on $hich the %i( %igma methods :or processes; are directed.
Lou see $hat * mean... *t is 'oth the su'ject and the o'ject. People easily get confused 'y terminology at the 'est of times1
so itAs $orth ta+ing e(tra care $hen using $ords li+e process $hich have at least t$o distinctly different meanings. 5or
e(ample avoid phrases such as 9%i( %igma is a process that uses processes to improve processes.9 *tAs true1 'ut its a load of
'olloc+s. %o1 $hen using the $ord process1 chec+ that people +no$ $hat process you are actually referring to1 and then you
$ill have a fighting chance of not disappearing up your o$n 'ac+side.
Pro6e )a;;ing ! diagrammatical representation of ho$ processes $or+1 as could 'e used and developed in team
meetings on a flip!chart1 or other media1 to ena'le teams to understand processes1 participants1 and $here and ho$
improvements might 'e made.
Pro&56tion P:anning ! generic term descri'ing the over!arching methodology used in managing the supply process from
receipt :or forecast; of customer reCuirements through to delivery notes and invoicing. Production planning therefore
includes&
interpretation of customer orders/reCuirements
$or+s orders
schedules and computer programs/ implications
parts1 stoc+s and materials
machinery1 plant1 eCuipment availa'ility and allocation
people and teams
Cuality and other targets ! setting and monitoring
stoc+ and purchasing monitoring and records
order processing1 administration and accounting
necessary inter!departmental liaison :e.g.1 sales1 e(port1 etc;
Production planning is typically highly modularized and computerized since process relia'ility is crucial and is
systematically repeated1 although production planning must also allo$ for variation in response to sales or other changing
demands and product specifications. Production planning is generally a $ee+ly and monthly reCuirement1 as $ell as
incorporating longer!term commitments and considerations. The particular sales environment and predicta'ility of the
mar+et and 'usiness have major impacts on production planning. Oolatile mar+ets and unpredicta'le sales o'viously ma+e
production planning more difficult. /osts and 'udgets1 health and safety1 environmental1 and other indirect considerations
or compliances are of course relevant to production1 'ut not directly1 and so are not included as integral parts of the process.
S ( Q , ! a natty little formula advanced 'y %i( %igma $riter George ,c+es for emphasising and assessing the need for
%i( %igma projects to feature 'oth strong technical Cuality :S;1 and strong acceptance 'y the sta+eholders of the project
teamAs proposed solutions :;. , represents the e(cellence of the results1 although $hy it should 'e , and not - rather
defeats me. #hatever1 the idea is a sound one1 in that is a multiplier and should along $ith S should 'e assessed in
simple terms at the early phase of a %i( %igma project. ,c+es suggests scoring each of S and out of )>1 and that if ,
eCuals anything less than 8> then the project is unli+ely to succeed1 $ith the implication to return to improving technical
Cuality and sta+eholder 'uy!in.
'i7 'igma ! ho$ long have you gotG.... at its most 'asic %i( %igma eCuates to 4.6 defects per million opportunitiesK at its
most sophisticated :dare one suggest most hypedG..; %i( %igma is an organizational philosophy.
'oft '?i:: ! s+ills reCuired for managing people1 relationships1 acceptance and effective communications. potential area
of vulnera'ility in many %i( %igma implementations1 'ecause of the predominance of %i( %igma team leaders $ith strong
process s+ills and attention to detail1 $hich can sometimes 'e at odds $ith the a'ilities of intuition1 empathy1 rapport!
'uilding1 relationship!'uilding1 and other AsoftA people!s+ills.
'ta?eho:&er ! vitally important aspect1 this one& sta+eholders are not just customers1 sta+eholders are all the people $ho are
affected 'y the solutions identified $ithin a %i( %igma project1 and all the people $ith some involvement in implementing
the solutions.
To::gate ! 'rea+s for revie$ 'et$een %i( %igma processes $ithin any of the DM*/ stages.
Tree Diagram ! pictorial representation of ho$ a 'road aim is 'ro+en do$n into detailed actions1 and $hich 'elong to
named individuals or departments. mapping techniCue that promotes creative thin+ing to$ards detailed causes and effects
and accounta'ilities. Delps to avoid tendencies for activities and accounta'ilities to 'e left too vague.
UAs/'ig UAs ! Motorola %i( %igma!spea+ for factors or varia'les that have the greatest impact on the A'ig LAsA.
LAs/'ig LAs ! Motorola %i( %igma!spea+ for the most important 'usiness results and measures that are lin+ed to critical
customer reCuirements and e(pectations.
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma B>
Cae 't5&8 : 'i7 'igma Im;:ementation in Bharti Broa&Aan&
Bharti Broad'and .et$or+s :BB.0; is a leading integrated 'road'and service provider operating in the 'road'and1
*nternet and O%T mar+ets. *t provides customised and integrated solutions to corporate customers. The company had a
goal of delivering error!free services to customers 'y doing the jo' right the first time1 every time.
#ith the Cuality o'jective having 'een decided1 an e(ecutive committee :,/; comprising nine officials1 including the /,"1
$as formed. The committee studied various other Cuality tools and processes li+e *%" and TSM in addition to %i( %igma.
The choice for %i( %igma $as made as it $as closely aligned $ith the outlined Cuality o'jective. ccording to sho+
Euneja1 /,"1 BB.01 9#e realised that the telecom industry is undergoing rapid change and so are customer reCuirements.
%i( %igma met the reCuirements of this changing environment.9 There $ere already several case studies of successful %i(
%igma implementations in large companies li+e G,1 Motorola1 #ipro1 T/% and %atyam.
)a?ing the 65tomer a ;riorit8
Daving decided upon *G, as the consultant1 the %i( %igma initiative $as formally launched in Eune 3>>4 $ith the tagline&
A%i( %igma!my customer1 my priorityA. The company has outlined that improving customer satisfaction is the 'usiness
o'jective for first year of the initiative. The e(ecutive committee identified the processes that $ere in conjunction $ith this
focus area.
*n the first phase1 critical 'usiness processes $ere aligned $ith 'usiness o'jectives. The critical o'jectives identified are
customer satisfaction1 employee satisfaction1 improving revenue and free cash. 5irst1 the projects $ith processes mapped
against these o'jectives $ere to 'e underta+en. nd then the Cuality improvement projects for e(isting and ne$ products
$ere to 'e underta+en. lmost ?7 percent of %i( %igma projects at BB.0 are 'ased on customer satisfaction.
cross!functional team $as formed to tac+le each project. The team comprises a sponsor1 a leader and four to five team
mem'ers. The leader1 also called the A/hampionA can 'e either a Green Belt or Blac+ Belt. The duration for each project can
range 'et$een three to four months. 5or the first phase the team chose )7 critical projects that offered su'stantial gains.
Blac+ Belts are involved full!time in the Cuality improvement process $hile Green Belts spend around ?!)> percent of time
on Cuality improvement. Blac+ Belt can 'e engaged in t$o to three different projects simultaneously.
,ach project follo$s a five!phase methodology. These include defining and Cuantifying the pro'lem1 measuring the defect
rate1 i.e. the 'aseline. This is follo$ed 'y the analysis phase $here analysis is done on $hen1 $here and ho$ the defects
occur. The fourth step is improvement1 finding pro'a'le solutions and applying them. The final step is control in terms of
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma B)
sustaining the improvements. BB.0 is applying %i( %igma to processes for timely complaint resolution1 timely order
implementation1 timely invoice su'mission and ."/ complaint resolution.
#hen the teams started measuring critical 'usiness processes they found that the 'aseline $as not as per customer
e(pectations. There $ere gaps of around 4>!6> percent in some processes. The 'aseline having 'een measured1 targets $ere
set for improving the processes. fter analysing defects1 process improvement +ic+s in. %implifying the process instead of
changing the entire process 'rings in the improvement. The tool essentially reCuires fine!tuning the process and eliminating
those that do not add value. 9#hen you are simplifying the projects productivity goes up $ithin the same resources1 there'y
leading to optimum utilisation of the resources19 says Euneja. "ne of the $ays of simplifying processes is to use *T for
automating processes.
The e(ecutive committee continuously monitors the projects. There are monthly revie$s carried out 'y the /hampion1
%ponsor and *G,. Cuality dash'oard has also 'een created1 $herein every month performance is reported. The /," and
the /"" monitor $hether the o'jectives are 'eing met.
Benefit
*n si( months BB.0 had achieved timely complaint resolution 88 percent from the 'aseline1 timely order implementation
up B> percent from 'aseline1 timely invoice su'mission up 7) percent from 'aseline and ."/ complaint resolution that $as
6= percent from 'aseline. The %i( %igma process improvements have translated into productivity enhancements1 improved
customer satisfaction and process effectiveness. BB.0 is targeting an estimated saving of around -s )> crore in the first
year of operation.
The target $as to achieve == percent :i.e. appro(imately four %igma level; :A5irst Time -ightA; $ith respect to respective set
norms 'y March 3>>6 on all +ey critical processes. %ince %i( %igma is a continuous improvement initiative1 the company
$ill 'e underta+ing another 'usiness o'jective for the ne(t financial year. "n the future roadmap are %i( %igma for all
processes and higher ,!%T :employee satisfaction; and /!%T :customer satisfaction; inde(. BB.0 plans to get almost
=> percent of the employees to 'e Green Belts 'y 3>>71 $ith almost )>> percent of the employees to 'e involved in the %i(
%igma journey 'y the same time.
%ym'iosis centre for distance learning. Benefits and dvantages of %i( %igma B3

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