Basics of Six-Sigma

BASICS OF SIX SIGMA
TÜV SÜD South Asia 1 9/14/2007

INTRODUCTION
Participants
• Names
• Roles
• Expectations from this training

What is Six Sigma

What is Six Sigma?
• Sigma is a measurement that indicates how a process is

performing
• Six Sigma stands for Six Standard Deviations (Sigma is the

Greek letter used to represent standard deviation in statistics)
from mean. Six Sigma methodology provides the techniques
and tools to improve the capability and reduce the defects in
any process.
• Six sigma is a fact-based, data-driven philosophy of

improvement that values defect prevention over defect
detection.

What is Six Sigma?
• Philosophy: The philosophical perspective views all works as a

processes that can be defined, measured, analyzed, improved &
controlled (DMAIC). Processes require inputs & produce outputs. If
you control the inputs, you will control the outputs. This is generally
expressed as the y= f (x) concept.
• Set of Tools: Six Sigma as a set of tools includes all the

qualitative and quantitative techniques used by the six sigma expert
to drive process improvement. A few such tools include statistical
process control (SPC), Control charts, failure mode & effects
analysis, process mapping etc.

What is Six Sigma?
• Methodology: This view of Six Sigma recognizes the underlying

and rigorous approach known as DMAIC. DMAIC defines the steps a
Six Sigma practitioner is expected to follow, starting with identifying
the problem and ending with the implementation of long-lasting
solutions. While DMAIC is not only Six Sigma Methodology in use, it
is certainly the most widely adopted and recognized.
• Metrics: In simple terms, Six Sigma quality performance means

3.4 defects per million opportunities.

A little bit of History ….
• Six Sigma was developed by Bill Smith, QM at Motorola
• It’s implementation began at Motorola in 1987

• It allowed Motorola to win the first Baldrige Award in 1988
• Motorola recorded more than $16 Billion savings as a result of Six
Sigma
• Several of the major companies in the world have adopted Six Sigma
since then ….
Texas Instruments, Asea Brown Boveri, AlliedSignal, General Electric,
Bombardier, Nokia Mobile Phones, Lockheed Martin, Sony, Polaroid,
Dupont, American Express, Ford Motor,…..
The Six Sigma Breakthrough Strategy has become a Competitive Tool

Sigma as a Measure of Quality
σσ DPMO
DPMO RTY
RTY
• •Sigma
Sigmaisisaa statistical
statistical
2 308,537 69.1% unit for measuring
unit for measuring
3 66,807 93.3% quality
quality
4 6,210 99.4%
• •ItIt isis correlated
correlated to
to the
the
5 233 99.97% defect rate
defect rate and the and the
complexity
complexity of
of the
the
6 3.4 99.99966% process
process/ /product
product
Process
Process Defect
DefectPer
Per Rolled
Rolled
Capability
Capability Million
Million Throughput
ThroughputYield
Yield
Opportunities
Opportunities (Long
(LongTerm)
Term)
Six Sigma is a Standard of Excellence.

It means no more than 3.4 Defects per Million Opportunities.
Why Six Sigma

The Classical View of Performance
Practical Meaning of “99% Good”

• 20,000 lost articles of mail per hour
• Unsafe drinking water almost 15 minutes each day
• 5,000 incorrect surgical operations per week
• 2 short or long landings at major airports each day
• 200,000 wrong drug prescriptions each year
• No electricity for almost 7 hours each month
3 σ Capability Long Term Yield Historical Standard

93.32%
4 σ Capability Long Term Yield Current Standard

99.38%
6 σ Capability Long Term Yield New Standard

99.99966%

Benchmarking Chart
1,000,000
100,000 Restaurant Bills

Order Taking
Airline Baggage
10,000 Handling
Average
Company Payroll Processing
1,000
Purchased Material
Reject Rate
100
10
World Class
1
2 3 4 5 6 7
Domestic Airline Flight

Fatality Rate – 0.43 PPM
Six Sigma Results
• Defects are eliminated
• Production and development costs are reduced
• Cycle Times and Inventory Levels are reduced
• Profit Margin and Customer Satisfaction are improved

1 Sigma Shift Improvement Yields
• 20% Margin Improvement
• 12% - 18% Capacity Increase
• 12% Workforce Reduction
• 10% - 30% Capital Reduction

Six Sigma & Cost of Poor Quality (COPQ)

Cost of Poor Quality (COPQ) Correlation
••Process
Process Control
Control is
is pre-requisite
pre-requisite for
for error
error free
free
Quality
Quality
••COPQ
COPQis
isaaresult
resultof
ofpoorly
poorlycontrolled
controlledprocess
process
••Process
ProcessControl
Controlcan
canbe
bemeasured
measuredin
inPPM/Yield
PPM/Yield
••PPM/Yield
PPM/Yield measurements
measurementsare
arecorrelated
correlatedto
toCOPQ
COPQ
Six
Six Sigma
Sigma has
has shown
shown that
that the
the Highest
Highest Quality
Quality Producer
Producer is
is also
also
the
theLowest
LowestCost
CostProducer
Producer

What is the Cost Poor Quality
Internal
InternalCosts
Costs External
ExternalCosts
Costs
••Scrap
Scrap ••Warranty
Warranty
••Rework/Repair
Rework/Repair ••Retrofits
Retrofits
••Downtime
Downtime ••Service
ServiceCalls
Calls
••Redesign
Redesign ••Recalls
Recalls
••Excess
ExcessInspection
Inspection ••Lost
LostSales
Sales
••Excess
ExcessInventory
Inventory ••Long
LongCycle
CycleTimes
Times

Components of Cost of Poor Quality
People
People(Indirect
(IndirectLabor)
Labor) Maintenance
Maintenance
••Rework
Rework ••Maintenance
Maintenance
••Inspection
Inspection ••Repairs
Repairs
••Material
MaterialHandling
Handling ••Rearrangement
Rearrangement
••Maintenance
Maintenance
••Setup
Setup Defects
Defects
••Excess
ExcessOvertime
Overtime ••Scrap
Scrap
••Labor
LaborVariance
Varianceoffoffstandard
standard ••Rework
Rework
••Defects
Defects
Inventory
Inventory ••Warranty
Warranty&&Recalls
Recalls
••Raw
RawMaterial
MaterialHolding
HoldingCost
Cost ••Returned
ReturnedGood
GoodHandling
Handling
••WIP
WIPHolding
HoldingCost
Cost
••Finished
FinishedGood
GoodHolding
HoldingCost
Cost Premium
••Obsolescence PremiumFreight
Freight
Obsolescence ••Air
AirFreight
Freight
••Inventory
InventoryShrinkage
Shrinkage ••Expedited
ExpeditedTruck
TruckFreight
Freight

COPQ & Sigma / DPMO Relationship
COPQ Sigma DPMO
30-40% of Sales 2.0 308,537 Non Competitive
20-30% of Sales 3.0 66,807
15-20% of Sales 4.0 6,210 Industry Average
10-15% of Sales 5.0 233
<10% of Sales 6.0 3.4 World Class

COPQ & Sigma/Yield Relationship
COPQ Sigma Yield
30-40% of Sales 2.0 5% Non Competitive
20-30% of Sales 3.0 93%
15-20% of Sales 4.0 99.4% Industry Average
10-15% of Sales 5.0 99.976%
<10% of Sales 6.0 99.999655% World Class

Six Sigma Improvement Strategy
Know
Knowwhat
whatis
isImportant
Importantto
tothe
theCustomer
Customerand
andto
tothe
theBusiness
Business
Reduce
ReduceDefect
DefectLevels
Levelsby:
by:
1.
1. Reducing
Reducingthe
theVariation
Variation
2.
2. Centering
Centeringaround
aroundthe
theTarget
Target
Long Term
LSL USL
The Goals of Six Sigma
••Improved
ImprovedCustomer
CustomerSatisfaction
Satisfaction
••Defect
DefectReduction/Elimination
Reduction/Elimination
••Yield
YieldImprovement
Improvement
••Reduced
ReducedCOPQ
COPQ
••Improved
ImprovedProcess
ProcessCapability
Capability
••Stretch
StretchGoals
Goals––Target
Target66Sigma
Sigmastandards
standards
••Process
ProcessUnderstanding
Understanding
••Constant
ConstantMeasurement
Measurementof ofKey
KeyMetrics
Metrics
••Breakthrough
BreakthroughImprovement
Improvement
Six-Sigma
Six-SigmaObjectives
ObjectivesAre
AreDirectly
Directlyand
andQuantifiably
Quantifiably
Connected
Connectedto
tothe
theObjective
Objectiveof
ofthe
theBusiness.
Business.
A Final Note on Philosophy
Six
SixSigma
Sigmais
isaarelentless,
relentless,constant
constant
Journey
JourneyofofImprovement
Improvement

Phases of Six Sigma

Five Phases of Six Sigma
• Define
• Measure
• Analysis
• Improve
• Control

Define Phase Tools
• Voice of Customer (VOC)

• CT Matrix
• Business Matrix
• Pareto Analysis
• Project Charter
• Team Selection (ARMI )
• Top Level Process Map (SIPOC)

Define
Voice of Customer (VOC)

Establishing Customer Focus
••Customer
Customer –– Anyone
Anyone internal
internal or
or external
external to
to the
the
organization
organization who
who comes
comes in
in contract
contract with
with the
the product
product
or
oroutput
outputof
ofwork
work
••Quality
Quality –– Performance
Performance to
to the
the standard
standard expected
expected by
by
the
theCustomer
Customer

The Customer Problem
Customers
Customers will
willnot
notrepurchase
repurchaseaacompany’s
company’sproduct
productififthey
theyare
are
not
notsatisfied
satisfiedwith
withthe
thecurrent
currentcompany
companyproduct.
product.
The
The stronger
stronger the
the degree
degree of
of satisfaction
satisfaction with
with aa company’s
company’s current
current
product
product or
or service,
service, the
the greater
greater the
the likelihood
likelihood that
that aa customer
customer will
will
repurchase
repurchasefrom
fromthe
thesame
samecompany.
company.

Variation Is The Enemy in Achieving Customer Satisfaction
••Uncertainty
Uncertainty
••Unknown
Unknown
Variation ••Disbelief
Disbelief
••Risk
Risk
••Defect
DefectRate
Rate

What Do You Measure Now?
What
WhatNumbers
Numbersget
getthe
themost
mostattention
attentionin
inyour
yourarea?
area?
What
WhatQuality
QualityMeasurements
Measurementsdo doyou
youhave?
have?
Do
Dothey
theyhave
haveaaCustomer
CustomerFocus?
Focus?
Do
Dothey
theyhave
haveaaQuality
QualityFocus?
Focus?
Do
Dothey
theyhave
havean
anInput
InputFocus?
Focus?
How
Howdo
doyou
youuse
usethese
theseMeasures?
Measures?
Switching to a Sigma base measurement system
σ ••Measure
Measureof
••Measure
ofVariation
Measureof
Variationand
ofProcess
andQuality
Quality
ProcessCapability
Capability

What Do You Measure Now?
Driving value from the Need – Do interaction
Customer Supplier
Need Do
Customers
Customersand
andSuppliers
SuppliersExchange
ExchangeValue
Value
Through
Throughthe
theNeed-Do
Need-DoInteraction
Interaction

Maximizing the Need/Do Interaction
Delivery
Cycle Time
Price Customer
Need
Supplier Do Cost
Quality
Defects
Supplier
Supplierstrives
strivesfor
forperformance
performanceininCycle
CycleTime,
Time,Cost
Costand
andDefects
Defects
To
ToMeet
Meet
Customers
Customersexpectations
expectationsin
inDelivery,
Delivery,Price
Priceand
andQuality
Quality
Critical
CriticalTo
To
Matrix
Matrix
CT’s

Key Questions
•• What
What does
does the
the phrase
phrase “critical
“critical to
to satisfaction”
satisfaction” mean
mean
in
interms
termsofofaacustomer?
customer? CTS
CTS
•• What
What does
does thethe phrase
phrase “critical
“critical to
to quality”
quality” mean
mean in
in
terms
termsofofaaproduct
productor
orservice?
service? CTQ
CTQ
•• What
What does
does the
the phrase
phrase “critical
“critical to
to delivery”
delivery” mean
mean in
in
terms
termsof
ofaaproduct
productservice?
service? CTD
CTD
•• What
What does
does the
the phrase
phrase “critical
“critical to
to cost”
cost” mean
mean in
in terms
terms
of
ofaaproduct
productor
orservice?
service? CTC
CTC
•• What
What does
does the
the phrase
phrase “critical
“critical to
to process”
process” mean
mean in
in
terms
termsof
ofaaproduct
productor
orservice?
service? CTP
CTP

CT Concept
Need Quality Delivery Price
Do Defect-free Cycle time Cost
CTQ1 -Critical to Quality -Critical to Delivery -Critical

Cost to Cost
CTQ2
CTQ3
Processes
CTP1 -Critical to Process 1

CTP2

CTQ and CTP Characteristics
CTQ1 -Critical to Quality Output Y1

CTQ2
CTQ3
Processes
CTP1 - Critical to Process Input f1 (X)

CTP2

“Critical to” Characteristics
The
The inherent
inherent variation
variation of
of any
any dependent
dependent variable
variable (Y)
(Y) is
is
determined
determined byby the
the variations
variations inherent
inherent in
in each
each of
of the
the
independent
independentvariables
variablesf(x).
f(x).
Product or Service
requirement that
Y = f (X) One of the “vital few”
process variable (x) that
impacts Quality, significantly affect Y
Delivery or Cost
Product Process
Capability Capability
Probability Probability Probability

of Defects of Defects of Defects
Critical-to-Quality Critical-to-Process
characteristic characteristic
CTQ1 CTP1
Defect Opportunity Control Opportunity
The Focus of Six Sigma
Y = f (X)
YY XX11…..X
…..XNN
•• Dependent
Dependent •• Independent
Independent
•• Output
Output •• Input
Input Variables
Variables
•• Effect
Effect •• Cause
Cause
•• Symptom
Symptom Monitor
Monitor •• Problem
Problem Control
Control

CT Matrix Components
Y = f (X1,X2……,XN)
• Translation of customer needs into product or service

requirements in terms of Quality, Delivery and Cost.
Y • These are the CTQ,CTD and CTC Characteristics
• Breakdown of the processes required to produce the

product or service.
• Identification of projects by understanding the
f(X) relationship between product or service requirements
and the processes used.
• Identification of the process parameters f(x1,x2…….xN)
that affect the requirements.

Business
BusinessMetrics
Metrics

Business Metrics
•• Following
FollowingBusiness
BusinessMetrics
Metricscan
canbe
beused
usedin
inSix
SixSigma
SigmaProjects.
Projects.
•• Defect
Defectper
perUnit
Unit(DPU)
(DPU)
•• Defects
Defectsper
perMillion
MillionOpportunities
Opportunities(DPMO)
(DPMO)
•• Throughput
ThroughputYield
Yield(Yield)
(Yield)
•• Rolled
RolledThroughput
Throughput Yield
Yield (RTY)
(RTY)
•• Parts
Partsper
perMillion
Million(PPM)
(PPM)

Business Metrics
•• An
An example
example will
will illustrate
illustrate the
the use
use of
of business
business metrics
metrics used
used in
in
previous
previous slides.
slides.
•• Example:
Example:
AA process
process produces
produces 40000
40000 pencils.
pencils. Three
Three types
types of
of defect
defect can
can
occur
occur&& number
numberof
ofoccurrences
occurrencesare:
are:
•• Blurred
Blurredprinting
printing––36
36
•• Wrong
Wrong dimensions
dimensions ––118
118
•• Rolled
Rolledends
ends --11
11

Business Metrics
•• Defect
Defect per
per Unit
Unit (DPU):
(DPU):
== Total
Totalnumber
numberof
ofdefects
defects//No.
No.of
ofunits
units
==165
165//40000
40000==0.004125
0.004125
•• Throughput
Throughput Yield Yield (Yield):
(Yield):
== ee-DPU = ee-0.004125
-DPU = -0.004125 =
= 0.996
0.996
•• Parts
Parts per
per Million
Million (PPM):
(PPM):
== DPU
DPUxx10,00,000
10,00,000
==0.004125
0.004125xx10,00,000
10,00,000==4125
4125

Business Metrics
•• Defect
Defect per
per Million
Million Opportunities
Opportunities (DPMO):
(DPMO):
To
To Calculate
Calculate the
the number
number ofof opportunities,
opportunities, itit is
is necessary
necessary to to find
find the
the
number
number of
of ways
ways each
each defect
defect can
can occur
occur on
on each
each item.
item. In
In this
this product,
product,
blurred
blurredprinting
printingoccurs
occursin inonly
onlyone
oneway
way (the
(the pencil
pencil slips
slips in
in the
the fixture),
fixture),
so
so in
in the
the batch
batch there
there are
are 40,000
40,000 opportunities
opportunities for
for this
this defect
defect toto occur.
occur.
There
Thereare
arethree
threeindependent
independentplaces
placeswhere
wheredimensions
dimensionsarearechecked,
checked,soso
there
there are
are 33 xx 40,000
40,000 == 1,20,000
1,20,000 opportunities
opportunities for
for dimensional
dimensional defects.
defects.
Rolled
Rolled ends
ends can
can occur
occur at
at the
the top
top and
and // or
or the
the bottom
bottom of
of the
the pencil,
pencil, so
so
there
thereare
are40,000
40,000xx22==80,000
80,000opportunities
opportunitiesfor forthis
thisdefect
defecttoto occur.
occur. The
The
total
total number
number of
of opportunities
opportunities for
for defects
defects is
is 40,000
40,000 ++ 1,20,000
1,20,000 ++ 80,000
80,000
==2,40,000
2,40,000
DPMO
DPMO==(Total
(Totalno.
no.of
ofdefects
defectsxx10,00,000)
10,00,000)//(Total
(Totalno.
no.of
ofopportunities)
opportunities)
==(165
(165xx10,00,000)
10,00,000)//(2,40,000)
(2,40,000)==687.5
687.5

Business Metrics
•• Rolled
Rolled Throughput
Throughput Yield
Yield (RTY):
(RTY):
RTY
RTYapplies
appliestotothe
theyield
yieldfrom
fromaaseries
series of
of processes
processes and and is
is found
found
by
by multiplying
multiplying the
the individual
individual process
process yields.
yields. IfIf aa product
product goes
goes
through
through four
four processes
processes whose
whose yields
yields are
are 0.994,
0.994, 0.987,
0.987, 0.951
0.951 &&
0.990,
0.990,then
then
RTY
RTY==0.994
0.994xx0.987
0.987xx0.951
0.951xx0.990
0.990==0.924
0.924

Exercise-1
•• AAcar
car manufacturer
manufacturerproduces
produces15000
15000cars
carsper
permonth
month..Three
Three
types
typesofofdefect
defectcan
canoccur
occurat
atdifferent
differentstage
stage&&number
numberofof
occurrences
occurrences are:
are:
Initial
InitialAssembly
Assembly––5050(No.
(No.of
ofOpportunities
Opportunities––4)
4)
Intermediate
IntermediateAssembly
Assembly––9595(No.
(No.of
ofOpportunities
2)
Final
FinalAssembly
Assembly––35
35(No.
(No.of
ofOpportunities
3)
Calculate
Calculatethe
theDefects
Defectsper
perUnit
Unit(DPU),
(DPU),Defect
Defectper
perMillion
Million
Opportunities
Opportunities (DPMO),
(DPMO),Throughput
ThroughputYield
Yield&&Parts
Partsper
per
Million
Million(PPM).
(PPM).

Exercise-2
A B C D
Process A – Process B – Process C – Process D –

Mixing 100# in Making 100# in Converting 100# in Inspection 100# in –
– 90# out 90% – 80# out 80% – 90# out 90% 95# out 95%
Calculate
Calculate the
the Rolled
Rolled Throughput
Throughput Yield
Yield (RTY)
(RTY) for
for the
the above
above
process.
process.

Pareto
ParetoCharts
Charts

Pareto Charts
•• Pareto
Pareto Diagrams
Diagrams are
are an
an essential
essential tools
tools to
to help
help prioritize
prioritize
improvement
improvement targets.
targets. Paretos
Paretos usually
usually allow
allow us
us to
to focus
focus on
on the
the
20%
20% ofof the
the problems
problems that
that causes
causes 80%80% of of the
the poor
poor
performance.
performance.
Pareto Chart of Damage Interpreting the

9 results:
8 100
Focus on
7
80 improvements to
6
scratches and
Percent
5
Count
60
chips because
4
3 40 75% of the damage

2
is due to these
20
1 defects.
0 0
Dam age S cratch Chip Bend Dent
Count 4 2 1 1
Percent 50.0 25.0 12.5 12.5
Cum % 50.0 75.0 87.5 100.0

Pareto Chart (Second Level)
Interpreting the
Pareto Chart of Flaws by Period
results:
Peel Scratch Other Smudge The night shift is
Period = Day Period = Evening Flaws producing more
20
Peel
Scratch flaws overall. Most of
15 Other the problems are due
Smudge
10 to scratches and
5
peels. You may learn
a lot about the
Count
0
Period = Night Period = Weekend problem if you
20
examine that part of
15 the process during
10
the night shift.
0
Peel Scratch Other Smudge
Flaws
You should drill down using third level, fourth level, etc.,
as far as it makes sense in solving your problem.

Project
ProjectCharter
Charter

Project Charter
The
The Project
Project should
should be
be defined
defined through
through aa Problem
Problem Description/
Description/
Project
ProjectObjective
Objectiveand
andinclude:
include:
•• PPM
PPMor
orDPMO
DPMOBaseline
Baselinedata
data
•• Cost
Costof
ofPoor
PoorQuality
Quality(COPQ)
(COPQ)
•• Rolled
RolledThroughput
Throughput Yield
Yield (RTY)
(RTY)
••Inventory
Inventory or
or
••Other
OtherAppropriate
AppropriateMetric
Metric

SIX SIGMA PROJECT STATUS
Project Status Summary Report
Project Details Status Summary
Black Belt : Arpit Upadhyay Project No. B 004 Status: In Progress
Company/Plant: Bundy India Ltd., Baroda Product: DW tube Status Date: 30.08.06
Process : Double Wall tube manufacturing Process Owner : S.H. Pathak Review Date: 30.08.06
Champion: Vinod Dhar, Sukhdev Narayan Master Black Belt: R. K. Arora Last Review Date: 22.06.06
Process Team : S.H. Pathak, Jogesh Shah, M. Prejith Start Date : 10.01.06
Problem Decsription: To improve the produtivity on DW Line from 28471 to 47295 mtrs./shift End Date :
Metrics Y and Complementary Ys
Business Metric(s): Baseline Current Target 1 Improve OEE
1 Critical to Delivery 28471 mtrs/shift 30442 mtrs/shift 47295 mtrs/shift 2 Increase Availability
2 Critical to Cost 3.52 Lacs 99.06 Lacs/Annum 3 Reduce Down time
3
Z-Score
Projected Savings: 3.52 Lacs 99.06 Lacs/Annum
Constraints/Special Conditions Preliminary Plan
1. Target Productivity calculated based on 90% Efficiency and 7.45 hrs working time(Mini clean time
reduced). P
h Target Actual
a Date Date
s
MileStones
Define Measure Analyze Improve Control D 13.01.06 21.01.06
1 Team MSA 1st level cause Statistical SolutionMonitoring M 03.02.06 18.02.06
2 Metrics Baseline Capability Optimum Solution Standardization A 20.03.06 01.04.06
3 Process Process Map Root Cause Implement SolutionTrain I 20.06.06
4 Charter X Shortlisting Validate Solution Maintain C 20.07.06
Team
TeamSelection
Selection(ARMI)
(ARMI)

Team Selection (ARMI)
The
The Six
Six Sigma
Sigma Team
Team shall
shall include
include following
following members.
members.
•• A
ARRM
M II
•• Approver
Approver Resources
Resources Members
Members Interested
Interested Party
Party
•• Champion
Champion Maser
MaserBlack
BlackBelt
Belt Black
BlackBelt
Belt Stake
StakeHolder
Holder
•• Executive
Executive Green
GreenBelt
Belt Customer
Customer
Process
ProcessOwner
Owner Supplier
Supplier

Top
TopLevel
LevelProcess
ProcessMap
Map
(SIPOC)
(SIPOC)

Top Level Process Map
Top
Top Level
Level Process
Process Map
Map –– the
the basic
basic steps
steps or
or activities
activities that
that will
will
produce
produce the
the output
output –– the
the essentials,
essentials, without
without any
any extras.
extras. Everyone
Everyone
does
does these
these steps
steps –– no
no argument.
argument.
–– The
The Top
Top Level
Level Flow
Flow Map
Map isis the
the minimum
minimum level
level of
of
process
process flow
flow mapping
mapping required
required in
in order
order to
to begin
begin aa
FMEA
FMEA

List
List General
General Input
Input and
and major
major Customer
Customer Key
Key Output
Output Variables
Variables
Assembly
INPUTS AD-SP Air OUTPUTS
Dryer Body
Assembly Labor Part to Print
Procedures Performance to Spec
Materials Visually acceptable
Equipment, Fixtures Leak Free
Environment Identified
Cleanliness Clean
Rework Packaged for use
Consistent standard

Remember
Remember that
that processes
processes are
are also
also affected
affected by
by elements
elements that
that feed
feed into
into
and
and receive
receive from
from the
the process
process
Suppliers
Assembly
INPUTS AD-SP Air OUTPUTS
Dryer Body
Customers
This is known as the SIPOC Model

Basic Statistics

Statistics
• The Science of:
– Collecting,
– Describing,
– Analyzing,
– Interpreting data…
And Making Decisions

Type of Data
• Attribute Data (Qualitative)

– Categories like Machine 1, Machine 2, Machine 3
– Yes, No
– Go, No Go or Pass/Fail
– Good/Defective
– On-Time/Late
– Discrete (Count) Data
• # of Maintenance Equipment Failures, # of freight
claims
• Variable of Continuous Data (Quantitative)
– Decimal subdivisions are meaningful
– Cycle Time, Pressure, Conveyor Speed

Measures of Central Tendency
• What is the Middle Value of Distribution?
– Median
• What value represents the distribution?
– Mode
• What value represents the entire distribution?
– Mean ( x )
• What is the best measures of central tendency?

Data Distributions
• Mean: Arithmetic average of a set of values

– Reflects the influence of all values
– Strongly Influenced by extreme values
• Median: Reflects the 50% rank – the center number after a set
of numbers has been sorted from low to high.
– Does not include all values in calculation
– Is “robust” to extreme scores
• Mode: The value or item occurring most frequently in a series
of observations or statistical data.

Measure of Central Tendency - Mean
• Find the value of “n” and “X” for the following 2

distribution.
Are the 2
Distributions
Same?
n= X=
1 2 3 4 5 6 7 8 9
n= X=
What is the
Difference?

Measures of Variability - Spread
• Range “R” = Max – Min is an easy measure of Spread
n= X= R=
1 2 3 4 5 6 7 8 9
n= X= R=

Is Range a good Measure of Variability?
• Find the value of “n”, “X” and “R” for the following 2
distribution.
Do the 2
distributions
have same
Variability?
n= X= R=
1 2 3 4 5 6 7 8 9
n= X= R=
How do we
measure average
variability from
the Center?

Measures of Variability (Spread)
• Calculate Variance & Standard Deviation for these 2

Distributions.
n= X= R= V= S=
1 2 3 4 5 6 7 8 9
n= X= R= V= S=

Measures of Variability
• The Range is the distance between the extreme values of data

set. (Highest – Lowest)
• The Variance(S2) is the Average Squared Deviation of each
data point from the Mean.
• The Standard Deviation (s) is the Square Root of the Variance.
• The range is more sensitive to outliers than the variance.
• The most common and useful measure of variation is the
Standard Deviation.

Sample Statistics vs. Population Parameters
X = Sample Mean µ = Population Mean
S = Sample Standard σ = Population Standard

Deviation Deviation
Statistics Estimate Parameters

Statistical Calculations (Sample)
Mean Variance
n
∑
n
__ Xi ∑ ( Xi −
__
X ) 2
X= i =1 S2 = i =1
n n −1
Standard Deviation Standard Deviation
__
σ = R/ d 2 n
N d2 ∑ ( Xi − X
__
) 2
S = i =1
2
3
1.128
1.693 n −1
4 2.059
6 2.326
Statistical Calculation (Population)
Mean Variance
n
__ ∑
µ≈X
__
− 2
σ2 = i =1 ( Xi X )
n
Standard Deviation
∑ −
__
2
σ = i =1 ( Xi X )

Probability Density Functions (Shape)
• The Shape of the distribution is shown by the probability

Density Function.
• The Y axis is Probability Density and the X axis is Data Values
• Area Under the curve Represents the probability of finding a
data point between 2 Values.
• Probability Density Function Defines the interrelation between
the center and the spread.
• The distributions with known function are called Parametric
and those with unknown functions are called Non-Parametric

Distribution for a Targeted Process
• If an Expert Marksman is Shooting, what place has the

Highest Probability of getting a hit?

Distribution for a Targeted Process

Properties of Normal Distribution
• Normal Distribution is Symmetric

– Has equal No. of Points on both Sides
– Mean Median and Mode Coincide
• Normal Distribution is Infinite

– The chance of finding a point outside tolerance is not
absolutely Zero.
– We need to define a practical Limit of the Process

Properties of Normal Distribution
• Normal Curve & Probability Areas
68 %
95 %
99.73 %
-4 -3 -2 -1 0 1 2 3 4
TÜV SÜD South Asia 77

Output σ 9/14/2007
Let’s Summarize…
• We need data to study, predict and improve the processes.

• Data may be Variable or Attribute.
• To understand a data distribution, we need to know its
Center, Spread and Shape.
• Normal Distribution is the most common but not the only
shape.

Exercise-3
•• Calculate
Calculatethe
theMean,
Mean,Median,
Median,Range,
Range,Variance
Variance&&Standard
Standard
Deviation
Deviationfor
forfollowing
followingdata
dataset.
set.
2,
2,2,
2,5,
5,6,
6,7,
7,9,
9,99

Capability Analysis

Do we NEED Metrics and Baseline?
•• IfIfwe
wecannot
cannotmeasure
measureit,
it,we
wecannot
cannotimprove
improveit.
it.
•• Metrics
MetricsHelp
Helpus
usunderstand
understandwhere
wherewewestand
stand
•• Metrics
Metricshelp
helpus
usmove
movein
inthe
theright
rightdirection.
direction.
•• Metrics
Metrics provide
provide objectivity
objectivity toto peoples’
peoples’ feelings
feelings and
and
perceptions.
perceptions.
•• Metrics
Metrics provide
provide aa common
common language
language and
and help
help us
us share
share
information
informationwithout
withoutsubjectivity,
subjectivity,biases
biasesand
andconfusions.
confusions.
•• Metrics
Metricshelp
helpus
usset
setaacommon
commongoal.
goal.

Baseline
•• When
When wewe start
start aa long
long journey,
journey, we
we look
look at
at the
the mile
mile stones
stones to
to
find
findout
outhow
howfar
farwewehave
havecome…
come…
•• But,
But,suppose,
suppose,we
wedid
didnot
notknow
knowwhere
wherewe
westarted,
started,can
canwe
wetell
tell
how
howfar
farwe
wehave
havecome?
come?
•• Base
Baseline linesets
setsaastarting
startingpoint
pointof
ofour
ourjourney.
journey.
•• ItItisisthe
thefirst
firstmeasure
measureand andtells
tellsus
usabout
aboutas-is
as-isState.
State.
•• ItItalso
alsohelps
helpsus
usto
toset
settargets
targetsand
andscope
scopeout
outproject.
project.

What do we need to Measure?
•• We
Weneed
needto
tomeasure
measurewhatever
whateverisisimportant
importantto
tothe
theproject.
project.
•• We
Weneed
needto
totrack
trackthe
thefollowing
followingmetrics
metrics
1.1. YY
2.2. Business
BusinessMetrics
Metrics
3.3. ZZScore
Score

Why we need to Measure - Y
•• YYisisthe
themetric
metric(CTQ/CTD/CTC)
(CTQ/CTD/CTC)thatthatwe
weare
arefocusing
focusingon.
on.E.g.
E.g.
–– PPM,
PPM, No.
No. of
of mistakes
mistakes in
in aa form,
form, Dia
Dia Variation,
Variation, Power
Power
Factor,
Factor,etc.
etc.
–– Cycle
CycleTime,
Time,Lead
LeadTime,
Time,Inventory
InventoryLevel
Leveletc.
etc.
–– Maintenance
Maintenancecost,
cost,Utility
Utilitycost
costetc.
etc.

What we need to Measure - Business
•• Business
Business metrics
metrics are
are the
the justification
justification forfor taking
taking upup aa six
six
sigma
sigmaproject
projectand
andare
arerequired
requiredfor
formanagement
managementbuy-in. buy-in.
•• Since
Since Management
Management isis committing
committing resources
resources to to the
the project,
project, itit
needs
needstotoknow
knowwhat
whatwill
willbe
bethe
thebusiness
businessimpact.
impact.
•• One
One oror more
more business
business metrics
metrics areare required
required to to maintain
maintain
management
managementfocus
focusononthe
theproject.
project.OrOrelse,
else,ititwill
willbebeSix
SixSigma
Sigma
for
forthe
thesake
sakeof
ofSix
Six
•• Business
Business metrics
metrics are
are best
best expressed
expressed in in terms
terms ofof money
money but
but
could
couldbebeany
anythat
thatgive
givethe
thebig
bigpicture
picturee.g.
e.g.
•• COPQ,
COPQ,Customer
CustomerSatisfaction
SatisfactionIndex,
Index,RTY
RTYexc.exc.

What we need to Measure – Z Score
•• ZZScore
Scoreisisthe
thesigma
sigmalevel
levelof
ofthe
theprocess.
process.
•• This
Thisisisaacommon
commonmetric.
metric.
•• ItIt isis used
used asas common
common scalescale for
for measuring
measuring thethe extent
extent of
of
improvements.
improvements.
•• ItItalso
alsohelps
helpsususbenchmark
benchmarkagainst
againstworld
worldclass
classprocesses.
processes.
•• AA world
world class
class oror Six
Six Sigma
Sigma process
process operates
operates at
at 66 Sigma
Sigma
Levels
Levelsor oraaZZScore
Score==66

While Setting The Metrics, Remember…
•• The
Themetrics
metricsShould
Shouldbe berelevant
relevanttotothe
theProblem
ProblemStatement.
Statement.
•• IfIf both
both Variable
Variable and
and Attribute
Attribute Metrics
Metrics are
are available,
available, prefer
prefer
Variable
Variablemetric.
metric.
•• IfIfyour
yourmetric
metricisisaalean
leanmetric
metric(inventory,
(inventory,cycle
cycletime
timeetc.)
etc.)first
first
consider
considerLean
Leantools.
tools.
•• Sometimes
Sometimes counter-metrics
counter-metrics are are required
required toto ensure
ensure proper
proper
output.
output.
–– E.g.E.g.While
WhileImproving
Improvingthe themetric
metric––“Cycle
“CycleTime”,
Time”,Counter-
Counter-
metric
metric –– “Defect
“Defect rate”
rate” needs
needs toto be
be tracked
tracked soso that
that the
the
cycle
cycletime
timeisisnot
notreduced
reducedatatthe
theexpense
expenseof ofQuality
Quality

The Z - Transform
__
•• ZZ –– Transform
Transform isis used
used for
for aa X −X
Normally
NormallyDistributed
Distributedprocess.
process. Z=
•• ItItexpresses
from
expresseshow
fromthetheCenter
how__far
Center X in
farvalue
valueXXisis
interms
termsofof
σ
σσ
•• E.g.
E.g. for
for
__
aa normal
normal distribution
distribution Zσ
with
with X =70 and σ=10,
=70 and σ=10, aa the
the
value
value X=30
X=30 has
has z=(30-70)/10=-
z=(30-70)/10=-
44
•• InInother
other words
words the
the point
point X=30
X=30
isis4σ4σaway
awayFrom
Fromthethe mean
mean on
on
–ve
–veSide
Side
X X

The Z - Score
__
•• IfIf XX was
was substituted
substituted by by the SL − X
Tolerance
ToleranceLimitsLimits(LSL
(LSL&&USL),
the
Z=
ZZ will
will tell
tell how many σs
how many
USL),
σs are
are σ
there
there between
between Tolerance
Tolerance
Limits
Limits and and the
the center
center ofof the
the 4σ 3σ
process.
process.
•• This
This isis the
the Sigma
Sigma level
level or
or the
the
ZZScore
Score
•• E.g.
E.g. __for
for normal
normal distribution
distribution
with
withX =70 and σ=10,
=70 and σ=10, LSL=30,
LSL=30,
ZZL=(30-70)/10=-4
L=(30-70)/10=-4
•• For
ForUSL=100,Z=3
USL=100,Z=3
30 70 100

But Wait….
•• Every
Everytime
timewe
wemake
makeaabatch,
batch,do
dowe
weget
getthe
theSAME
SAMEamount
amountof
of
Variation?
Variation?
•• Why
Whydoes
doesthe
theprocess
processVARY
VARYfrom
frombatch
batchto
tobatch?
batch?
•• Can
Canwe
weprevent
preventBatch
Batchto
toBatch
Batchvariation
variationTOTALLY?
TOTALLY?
•• Data
Data from
from WHICH
WHICH ofof these
these batches
batches should
should be
be taken
taken for
for
calculating
calculatingZZScore?
Score?
•• How
HowmuchmuchdatadataisisSUFFICENT?
SUFFICENT?
•• IfIfI Iget
getdifferent
differentZZScores
Scoresfor
fordata
datacollected
collectedat
atdifferent
differenttimes
times
which
whichof
ofthem
themisisCORRECT?
CORRECT?

Well
•• Every
Every time
time we
we make
make aa batch,
batch, we
we may
may NOT
NOT get
get the
the same
same
amount
amountof ofVariation.
Variation.
•• The
Theprocess
processvaries
variesfrom
frombatch
batchto
tobatch
batchdue
dueto
toMEAN
MEANSHIFT
SHIFT
over
overaaperiod
periodof
oftime.
time.
•• We
Wecan
canMINIMIZE
MINIMIZEthis
thisbut
butnot
notprevent
preventit.
it.
•• This
This means
means that
that process
process will
will have
have more
more variation
variation in
in LONG
LONG
TERM
TERMwhen
whencompared
comparedtotoSHORT
SHORTTERM
TERMvariation.
variation.
•• AAprocess
processisisSix
SixSigma
Sigmaprocess
processwhen
whenthe
theshort
shortterm
termZZScore
Score
isis66

Shot Term vs Long Term
•• Mean
Meanof ofaaprocess
processshifts
shiftsover
over Mean Shift
aaperiod
periodof oftime.
•• This
time. = 1.5σ
This Shift
Shift isis empirically
empirically
observed
observedto tobebe1.5
1.5
•• So Zlt = 4.5σ
SoZlt
Zlt==Zst-1.5
Zst-1.5Approx.
Approx.
•• And
AndZst
Zst=Zlt+1.5
=Zlt+1.5Approx.
Approx.
•• AA Six
Six Sigma
Sigma Process
Process has
has Zst
Zst
=6
••
=6
So
Zlt = 6σ
So aa Six
Six Sigma
Sigma Process
Process has
has
Zlt
Zlt=4.5
=4.5
LSL Xlt Xst USL

Capability vs Performance
•• Zst
Zst represents
represents the
the CAPABILITY
CAPABILITY of
of the
the process
process whereas
whereas Zlt
Zlt
represents
representsthe
thePERFORMANCE
PERFORMANCEover overaaperiod
periodof
oftime
time
•• What
WhatisisCapability?
Capability?
–– Inherent
Inherentability
ability
–– Due
Dueto toCommon
CommonCauses
Causesof
ofVariation
Variation
•• What
WhatisisPerformance?
Performance?
–– Final
FinalOutput
Output
–– Due
DuetotoCommon
Commonas
aswell
wellas
asSpecial
SpecialCauses
Causesof
ofvariation
variation

Causes of Variation
•• Common
CommonCause
Causeof
ofVariation
Variation
–– Are
Areananintrinsic
intrinsicpart
partof
ofthe
theprocess
process
–– Give
Giveconsistent
consistentVariation
Variation
–– Affect
Affecteach
eachdata
datapoint
pointequally
equally
–– Are
Arereflected
reflectedin
inUnit
Unitto
toUnit
UnitVariation
Variation
•• Special
SpecialCauses
Causesof
ofVariation
Variation
–– Are
Areusually
usuallyoutside
outsidethe
theprocess
process
–– Appear
Appearsome
sometime
timeand
andnot
notat
atthe
theother
othertimes
times
–– Affect
Affectsome
somedata
datapoints
pointsmore
morethan
thanothers
others
–– Are
Arereflected
reflectedin
inTime
Timeto
totime
timeVariations
Variations

Causes of Variation - Examples
•• Common
CommonCause
Causeof
ofVariation
Variation
–– Usual
UsualTraffic
Trafficon
onRoad
Road
–– Usual
UsualPlay
Playin
inthe
theSlides
Slidesof
ofmachine
machine
–– Human
HumanAttentiveness
Attentiveness
–– Variation
Variationin
indimensions
dimensionsin
inaalot
lotmanufactured
manufacturedtogether.
together.
•• Special
SpecialCauses
Causesof
ofVariation
Variation
–– Accident
Accidenton
onRoad
Road
–– Excess
ExcessPlay
Playin
inSlide
Slidedue
dueto
towear
wearover
overtime.
time.
–– Illness
Illness
–– Variation
Variationdue
dueto
toChange
Changein
inlot
lotor
orsupplier.
supplier.

Stability
•• When
Whenthethevariation
variationisisonly
onlydue
duetotocommon
commoncauses,
causes,the
theprocess
processisissaid
saidto
tobe
be
Stable.
Stable.
•• AAStable
StableProcess
Processhas
haspredictable
predictablevariation.
variation.
•• Special
Special causes disturb the stability of
causes disturb the stability of the
the process
process due
due to
to which
which the
the
Variation becomes unpredictable.
Variation becomes unpredictable.
•• AAStable
Stableprocess
processisisalso
alsocalled
calledaaprocess
processinin“Control”
“Control”
Xbar Chart of Stable Xbar Chart of Unstable

5 7.5 1 1
UCL=4.700
4 UCL=5.98
5.0
3
2
Sample Mean
Sample Mean
2.5
1 _
_ _
_
X=0.442 X=0.63
0 0.0
-1
-2 -2.5
-3
-5.0 LCL=-4.73
-4 LCL=-3.817
1
1 3 5 7 9 11 13 15 17 19 21 23 25 1 3 5 7 9 11 13 15 17 19 21 23 25
Sample Sample

Capability vs Stability
•• Capability
Capabilityhas hasaameaning
meaningonlyonlywhen
whenaaprocess
processisisstable.
stable.
•• IfIf aa process
process isis out
out of
of control,
control, first
first we
we need
need toto stabilize
stabilize the
the
process.
process.
•• Improvement
Improvement in in the
the inherent
inherent variation
variation cancan bebe made
made only
only
when
whenthe theprocess
processisisstable.
stable.
•• Control
ControlChartsChartsare
areused
usedtotostudy
studystability
stability
•• The
The first
first job
job of
of Six
Six Sigma
Sigma practitioner
practitioner isis toto Identify
Identify and
and
remove
removeSpecialSpecialCauses
Causesof ofVariation.
Variation.
•• Once
Once the the process
process isis made
made predictable,
predictable, the the next
next job
job isis to
to
identify
identifythe thecauses
causesof ofinherent
inherentvariation
variationandandremove
removethem.
them.

Calculating Capability
•Capability Can be defined as Tolerable Variation

Process Variation
LSL USL
X + 1σ
X + 2σ
T
USL − LSL X + 3σ Cp =
Cp = 6σ
6σ
• Marginal Capability
LSL USL
X + 1σ
X + 2σ
X + 3σ
T 6σ
Cp =
6σ
Cp =
6σ
Cp = 1
• Six Sigma Capability
LSL USL
3σ 3σ
X + 3σ
X + 6σ
T 12σ
Cp = Cp = Cp = 2
6σ 6σ
• Calculate Cp from Upper & Lower Side
___
USL − X
___
X − LSL CpU =
Cp L = 3σ
3σ
___ ___
X − LSL USL − X
0 2 4 6 8 10 12 14 16 18 20
⎡ __ __
⎤
X − LSL USL − X
Cp K = Min ⎢ , ⎥
⎢ 3σ 3σ ⎥
⎣ ⎦

Calculating Performance
• Calculate Cp from Upper & Lower Side
___
USL − X
___
X − LSL PpU =
PpL = 3σ
3σ
___ ___
X − LSL USL − X
0 2 4 6 8 10 12 14 16 18 20
⎡ __ __
⎤
USL − LSL X − LSL USL − X
PpK = Min ⎢ , ⎥
Pp = ⎢ 3σ 3σ ⎥
6σ ⎣ ⎦

Capability vs Performance
USL − LSL USL − LSL
Cp = Pp =
6σ 6σ
⎡ __ __
⎤ ⎡ __ __
⎤
X − LSL USL − X X − LSL USL − X
Cp K = Min ⎢ , ⎥ PpK = Min ⎢ , ⎥
⎢ 3σ 3σ ⎥ ⎢ 3σ 3σ ⎥
⎣ ⎦ ⎣ ⎦
•• IfIfthe
theformula
formulaare
aresame,
same,what
whatisisthe
thedifference?
difference?
•• The
Thedifference
differenceisisin
inSigma
Sigmacalculation!
calculation!
•• Sigma
Sigmain inCapability
Capabilitycovers
coversShort
ShortTerm
TermVariation.
Variation.
•• Sigma
Sigmain inPerformance
Performancecovers
coversLong
LongTerm
TermVariation.
Variation.
•• How
HowisisthetheData
Datacollection
collectionDifferent?
Different?

Capability Calculation
•• Capability
Capabilitycovers
coversshort
shortterm
termvariation.
variation.
•• ItItrequires
requiresdata
datacollected
collectedover
overshort
shortperiod
periodof oftime.
time.
•• Small
Small Subgroups
Subgroups of of data
data (Generally
(Generally 3-7
3-7 sample
sample size)
size) are
are
taken.
taken.
•• Data
Data points
points within
within aa subgroup
subgroup need
need toto bebe of
of consecutive
consecutive
output.
output.
•• Many
Manysubgroups
subgroupsarearecollected
collectedover
overaaperiod
periodof oftime.
time.
•• The
Theaverage
averagevariation
variationwithin
withinaasubgroup
subgroup isisconsidered
considered to
to be
be
present
presentthe
theinherent
inherentVariation.
Variation. R
__
•• Sigma σ=
Sigmaisiscalculated
calculatedusing
using d2
•• Should
Shouldbe beused
usedonly
onlywhen
whenprocess
processisisstable
stable

Performance Calculation
•• Performance
Performancecovers
coverslonglongterm
termvariation.
variation.
•• ItItrequired
requireddata
datacollected
collectedover
overlong
longperiod periodof oftime.
time.
•• Data
Data should
should represent
represent more
more than
than one one day, day, ifif possible
possible more
more
than
thanaamonth
monthof ofvariation.
variation.
•• IfIf Data
Data points
points are
are too
too many,
many, one
one may may randomly
randomly sample
sample the
the
data
datatotorepresent
representall
alldays
daysand
andbatches.
batches.
•• The
The Root
Root Mean
Mean Square
Square variation
variation isis considered
considered to to to
to
represent
representthetheOverall
OverallVariation.
Variation. ⎛⎜ xi − X__ ⎞⎟
2
•• Sigma
Sigmaisiscalculated
calculatedusing
using σ = ⎝ ⎠
n −1
•• Should
Should bebe used
used only
only when
when data
data isis available
available over
over aa long
long
period
periodof
oftime.
time.

Capability, Performance and Z Score
⎡ __ __
⎤ •• IfIf the
the process
process isis Stable,
Stable,
X − LSL USL − X ⎥
Cp K = Min ⎢ , Collect
Collect Short
Short term
term data
data
⎢ 3σ 3σ ⎥ using Subgroups,
⎣ ⎦ using Subgroups,
Calculate
Calculate Cpk
Cpk and
and
⎡ __ __
⎤
X − LSL USL − X ⎥ Zst=3xCpk
Pp K = Min ⎢ , Zst=3xCpk
⎢ 3σ 3σ ⎥
⎣ ⎦ •• IfIf the
the process
process isis Unstable
Unstable
⎡ __ __
⎤ oror Stability
Stability isis not
not known,
X − LSL USL − X known,
Z = Min ⎢ , ⎥ Collect
⎢ σ σ ⎥ Collect Long
Long termterm data
data by
by
⎣ ⎦ random
random sampling,
sampling,
Calculate
Calculate Ppk
Ppk and
and
So Zlt=3xPpk.
Zlt=3xPpk. Convert
Convert itit into
into
Short
Short Term
Term bench
bench mark
mark ZZ
ZLT=3 X Ppk bybyZst=Zlt+1.5
Zst=Zlt+1.5
&
ZST=3 X CpK

Z Score Calculation Road Map
Select Y
Attribute Y Variable Y
Normal Non-Normal
Un-Stable
Calculate Stable
Process/
DPU Process
Not Known
Non
Normal
Capability
Calculate Calculation
Zlt
Calculate
Zst
Zst is the baseline Z score

Exercise-4
•• Calculate
Calculate the
the ZZ Score
Score for
for the
the following
following processes.
processes.
1.
1. Data
DataofofLength
Lengthin inmachining
machining process
process has
has been
been collected.
collected. The
The
required
requiredlength
lengthisis555
555max.
max. The
The Process
Process has
has been
been behaving
behaving
consistently
consistentlyforforlast
last66months.
months. The
Thedata
datawas
wascollected
collectedfor
forthe
the
first
first55pieces
piecesforforeach
eachof
oflast
last35
35 batches.
batches.The
Themean
meanofofthe
thedata
data
is
is540.26857
540.26857&&Standard
Standarddeviation
deviationis
is10.38606.
10.38606.
2.
2. Data
Datafor
forCycle
CycleTime
Timeof ofaamolding
moldingprocess
processhashasbeen
beencollected.
collected.
The
Thespecification
specificationisis60-65
60-65sec.
sec.The
TheProcess
Processhashasbeen
been
behaving
behavingerratically
erraticallyfor
forlast
last88 months.
months.The
Thedata
datacollected
collectedfor
for
the
thefirst
first55pieces
piecesfor
foreach
eachofoflast
last30
30shifts.
shifts.The
Themean
meanofofthe
the
data
dataisis64.03827
64.03827&&Standard
Standarddeviation
deviationisis0.54618.
0.54618.

Implementation of Six Sigma

Phases of Breakthrough Strategy
Phase I: Process Measurement

Characterization
Phase II: Process Analysis
Phase III: Process Improvement

Optimization
Phase IV: Process Control

Phase of Breakthrough Strategy
Phase
PhaseI:I:Process
ProcessMeasurement
Measurement
••Identify
IdentifyKPIV’s
KPIV’sand
andKPOV’s
KPOV’sononProcess
ProcessMap/FMEA
Map/FMEA
••Establish
EstablishMeasurement
MeasurementSystem
SystemCapability
Capability
••Establish
EstablishProcess
ProcessCapability
CapabilityBaseline
Baseline
Phase
PhaseII:
II:Process
ProcessAnalysis
Analysis
••Update
UpdateProcess
ProcessMap,Map,FMEA,
FMEA,Control
ControlPlan
Plan&&Capability
Capability
••Identify
IdentifyCritical
CriticalInput
InputVariable
Variable
••Analyze
AnalyzeProcess
Processdatadatausing
usingSix
SixSigma
SigmaTools
Tools
Phase
PhaseIII:
III:Process
ProcessImprovement
Improvement
••Verify
Verifyand
andoptimize
optimizeCritical
CriticalInput
InputVariables
Variables
••Identify
Identifyand
andTest
TestProposed
ProposedSolutions
Solutions
••Implement
ImplementSolutions
Solutionsand
andConfirm
ConfirmResults
Results
Phase
PhaseIV:IV:Process
ProcessControl
Control
••Standardization
Standardization//Mistake
MistakeProofing
Proofing
••Implement
ImplementProcess
ProcessControls
Controlsand
andVerify
VerifyEffectiveness
Effectiveness
••Monitor
MonitorProcess
Processby byControl
ControlPlan—HOLD
Plan—HOLDthe theGains
Gains
Phase I: Process Measurement
Plan Project and Identify Key Process Metrics, Inputs and Outputs
• Project Selection Justification
• Business Metrics (RTY, COPQ, PPM)
• Process Mapping / Data Collection Process/Control Plan
• Cause & Effect Matrix / FMEA
Quantify Variation on Vital Few Variation Sources

• 3 Level Pareto charts
• Vital Few Variation Sources
• Gage Studies (GR&R)
Perform Short-term Capability Study

• Short-term and Long-term Capability
– CpK, PpK
– SPC Charts
– Sigma (Z) Calculations

Phase II: Process Analysis
Update Project Baseline and Status

• Project Status From
• Metric Graph with Goal Line
• Process Map / FMEA / Control Plan
Identify Root Causes of Variation

• Multi-Vari and Horizontal Root Cause Charts
• SPC Charts
• Fishbone Chart, Documenting Input Variables
• Hypothesis Tests to Verify Critical Input Variables
• List of Critical Input Variables
• List of Containment Actions

Phase III: Process Improvement

Optimize Process
• Test and Verify Critical Input Variables
• Use Statistical Tools to Optimize Process
• Identify, Plan and Test Proposed Solutions
• Select Solutions and Confirm Results
• Implement Solutions and Improvement Plans
• Document Improvement Plans and Actions

Phase IV: Process Control

Optimize Process
• Each Standardization and Mistake Proofing
• Implement Process Controls
• Verify Effectiveness of Process Controls and System Improvements
• Monitor Process by Control Plan
• HOLD and GAINS

Statistical Problem Solving
D M • Define the Problem in terms of

Physical Statistical
Y and Probable Xs
Problem Problem
• Measures the Extent of Problem
• Shortlist the Xs for analyses

• Collect Data
A • Eliminate Xs that are not
important
• Finalize Xs for Optimization
• Confirm the short listed Xs

• Find Y=f(X) or Best case for the
Physical Statistical selected Xs
Solution C I Solution • Identify Physical controls based
on constraints
• Verify and Maintain new
controls
THANK YOU

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BASICS OF SIX SIGMA

TÜV SÜD South Asia 1 9/14/2007

TÜV SÜD South Asia 2 9/14/2007

TÜV SÜD South Asia 3 9/14/2007

• Sigma is a measurement that indicates how a process is

• Six Sigma stands for Six Standard Deviations (Sigma is the

• Six sigma is a fact-based, data-driven philosophy of

TÜV SÜD South Asia 4 9/14/2007

• Philosophy: The philosophical perspective views all works as a

• Set of Tools: Six Sigma as a set of tools includes all the

TÜV SÜD South Asia 5 9/14/2007

• Methodology: This view of Six Sigma recognizes the underlying

• Metrics: In simple terms, Six Sigma quality performance means

TÜV SÜD South Asia 6 9/14/2007

• Six Sigma was developed by Bill Smith, QM at Motorola

• It’s implementation began at Motorola in 1987

The Six Sigma Breakthrough Strategy has become a Competitive Tool

TÜV SÜD South Asia 7 9/14/2007

Six Sigma is a Standard of Excellence.

TÜV SÜD South Asia 9 9/14/2007

Practical Meaning of “99% Good”

3 σ Capability Long Term Yield Historical Standard

4 σ Capability Long Term Yield Current Standard

6 σ Capability Long Term Yield New Standard

TÜV SÜD South Asia 10 9/14/2007

100,000 Restaurant Bills

Domestic Airline Flight

• Defects are eliminated

• Production and development costs are reduced

• Cycle Times and Inventory Levels are reduced

• Profit Margin and Customer Satisfaction are improved

TÜV SÜD South Asia 12 9/14/2007

• 20% Margin Improvement

• 12% - 18% Capacity Increase

• 12% Workforce Reduction

• 10% - 30% Capital Reduction

TÜV SÜD South Asia 13 9/14/2007

TÜV SÜD South Asia 14 9/14/2007

TÜV SÜD South Asia 15 9/14/2007

TÜV SÜD South Asia 16 9/14/2007

TÜV SÜD South Asia 17 9/14/2007

COPQ Sigma DPMO

30-40% of Sales 2.0 308,537 Non Competitive

20-30% of Sales 3.0 66,807

15-20% of Sales 4.0 6,210 Industry Average

10-15% of Sales 5.0 233

<10% of Sales 6.0 3.4 World Class

TÜV SÜD South Asia 18 9/14/2007

COPQ Sigma Yield

30-40% of Sales 2.0 5% Non Competitive

20-30% of Sales 3.0 93%

15-20% of Sales 4.0 99.4% Industry Average

10-15% of Sales 5.0 99.976%

<10% of Sales 6.0 99.999655% World Class

TÜV SÜD South Asia 19 9/14/2007

TÜV SÜD South Asia 22 9/14/2007

TÜV SÜD South Asia 23 9/14/2007

TÜV SÜD South Asia 24 9/14/2007

• Voice of Customer (VOC)

TÜV SÜD South Asia 25 9/14/2007

Voice of Customer (VOC)

TÜV SÜD South Asia 26 9/14/2007

TÜV SÜD South Asia 27 9/14/2007