Professional Documents
Culture Documents
Course Objectives
The objectives of this workshop are:
To explain the purpose of Six Sigma
and the Six Sigma approach.
To discuss Six Sigma implementation.
To discuss the process for setting up
projects and deploying project teams.
Course Contents
• Six Sigma Overviews
• The DMAIC Process Steps and Tools
• Six Sigma Implementation
• Collective Decision Making
• Define: Set Up Projects and Deploy Teams
Section 1
Six Sigma Overview
Six Sigma: What & Why
RESULTS
Six Sigma Approach — Key Components
B
Role & Responsibility:
Executive Team Champion
Black Belts
Green Belts
Example : CTQ Tree Sales Orders Sales Lead Time
On Time Delivery
Order Fulfillment
Customer Complaints
Increase Sales Production Output Process Yield
Down Time
Process Efficiency
New Products Time to Market
Market Success Rate
Design Changes
Henry Ford
Six Sigma Benefits
GE Capital’s railcar-leasing business achieved 62% reduction in
turnaround time at its repair shops.
Green Belt
Black Belt
• Brainstorm Possible Causes
ANALYZE • Verify Root Causes
• Identify Improvement Solutions
IMPROVE • Validate Effectiveness
• Establish Control System
CONTROL • Share Lessons Learned
The DMAIC Toolkit
Define Measure Analyze Improve Control
Process Map Data Collection Pareto diagram Creativity Control plan
Brainstorming plan Brainstorming Techniques Documentation
Dashboard Histogram Nominal group Selection matrix system
CTQ Drill Distribution technique Design Of Control charts
Scatter plot Experiments On the job
Down Measurement
Box plot Force field training
Cause & Effect System
analysis Story board
analysis Analysis Stratification
Potential risks
Pareto diagram Descriptive FMEA
assessments
Selection Matrix Statistics Process C&E
Stakeholder
Project Charter Run charts matrix analysis
Control Charts Interval Estimate Process
Process Hypothesis Test Capability
Capability Process mapping
and analysis
A] Soft Tools (Team Problem Solving)
— Brainstorming
— Affinity Diagram
— Nominal Group Technique
— Decision Matrix
— Effectiveness / Practicality Matrix
— Quality Function Deployment
— Failure Mode and Effect Analysis
— Force Field Analysis
B] Hard Tools (Quantitative Data Analysis)
— Graphical Tools
— Process Capability Study
— Measurement System Analysis
— Hypothesis Testing
— Design Of Experiments
— Control Charts
C] Work Process Redesign
— Process Mapping
— Non-value Add Analysis
— 7 Principles of Process Redesign
— Technology Enabler
— Process Streamlining
— “ Should Be ” Process Map
Input Process Output
D] LEAN
— Value Stream Mapping
— Seven Major Wastes
— Flow-based Processing
— Kan ban System
— Set-up Reduction
— Mistake Proofing
— Visual Management
— Take Time
— Total Productive Maintenance
Six Sigma Key Features
called standard deviation that measure the variability of data from the
mean.
In Six Sigma program, Sigma is an index for measuring the capability
The higher the sigma level, the less likely a process will produce
defects. As sigma increases, costs go down, cycle time goes down,
and customer satisfaction goes up.
Process Variation
Input Process Output
0 10 20 30 40 50 60 (minutes)
Process Variability &Process Capability
Process Output Customer Customer
Variability Requirements Requirements
Defects
Indirect Loss
20 – 25% • Expediting Costs
• Ad-hoc meetings
Of Sales
• Service Recovery
• Corrective Actions
Opportunity For Increasing
Profit Margin • Lost Customer Goodwill
• Longer Cycle Time
Process Variability and COPQ
Correlation between an organization’s COPQ and variability
of its key processes
COPQ (% of Sales)
40
30
20
10
2 3 4 5 6 Sigma Level
(308538dpmo) (66807dpmo) (6210dpmo) (233dpmo) (3.4dpmo)
Why Six Sigma?
Q: Is the goal of Six Sigma to achieve six sigma level of
quality?
Design for Six Sigma
High Hanging Fruits
(DFSS)
(~ 6 Sigma)
Six Sigma Approach
Bulk of Fruits (DMAIC)
(~ 5 Sigma)
Low Hanging Fruits QCC & 7 Basic Tools
(~ 4 Sigma)
Ground Fruits Common Sense &
(~ 3 Sigma) Intuition
What Is Six Sigma - Summary
A management approach aiming at improving processes to
achieve excellent performance level.
SIPOC Diagram
[ Supplier — Inputs — Process — Outputs — Customers ]
Suppliers Customers
Step 2: Set Up Project and Deploy Team
Purpose: To clarify the issue faced within the focus area and deploy
suitable team to tackle the issue.
• Here, the champion (usually with the help of his / her people) defines
the problem statement, decide the improvement goal, and select the
project team members.
• This helps to make sure that due thoughts are given to make sure
that the project is a valid one.
• The project should be scoped at she process level where specific
actions can be taken to realize the improvement in business results.
• The outcome of this step is an approved project charter.
Project Selection Process-Overview
Project Ideas Sources Performance Voice of Cost Reduction
Gap Customer Initiative
Competitive Issues of
Pressure Concern
Project Ideas Sources
Project
Project Ideas Sources Charters
Project Charter
• Project charter is a document created at the outset of a project
to assign the project to the team.
• It is an important tool for building committed project team.
• A Team Charter should specify the followings:
- Project title.
- The process involved.
- The business case and problem statement.
- The goal statement.
- Estimated financial benefits.
- Name of Champion.
- Team leader and members.
- Project time line.
The 4 ‘Rights’ of Successful Project
• Right project
• Right team composition
• Right team process
Right Result
Notes on forming a team :
Problem Statement :
About 30% of payments are received later than 60 days after
invoices were issued.
Goal Statement :
To reduce the percentage of late payments to less than 5%.
Financial Benefit :
Successful completion of this project will result in an estimated
financial benefit of US$50,000.
Data Collection Plan
Critical To Quality: Payment received on time
Measure: Cycle time from date of invoice issued to date of
payment received (days)
Specification: Not more than 60 days
Process output unit: An invoice
Data source: Account department
Data collection method: Pre-exist data
Sample frame: Three months period from January to March
Sampling method: Random sampling
Number of samples: 60
And Then…
Minitab
A powerful data-analyzing software
which can help us have a good
knowledge of current performance
Step 6: Brainstorm All Possible Causes
Purpose: List all possible factors causing the process
performance gap.
- It can’t be done.
- It will not work. - How to get it done.
- They’ll never buy it. - Try and make it works.
- We’ve always done it this - We can convince them.
way. - Let’s see if there is a better way.
- We’ve never try this before. - If we don’t try, we don’t know.
Examples of tools for idea generation,
evaluation and selection:
• Creative thinking techniques
• Brainstorming
• Effectiveness — Practicality Matrix
• Lateral Field Analysis
• Selection Matrix
Use Effectiveness – Practicality Matrix to evaluate each idea
Effectiveness
G C
F D
A
Practicality
B
E
Using Force Field Analysis to evaluate in detail the idea of
giving rebate if customers pay on time for those invoices with
high dollar values.
Goal Statement :
To reduce the turn-around-time time to 1 day.
The process :
Orders fulfillment process
Measure
Map Current Process
been completed.
- Store supervisor waits for the test certificates before he
can prepare the shipments.
B] Duplications
- Packers record product names,lot numbers and quantities
and send these information to store.Store supervisor key
in the same information into the finished goods inventory
system.
C] Non-value Adding Activities
- Unnecessary movements involved in sending information
or documents around.
Improve
Identify Improvement Solutions
A] Reduce waiting
- Laboratory tests and visual inspections to be performed
concurrently.
- Store supervisor prints test certificates from computerized
workflow system.
workflow systems.
- Empower QA technicians to decide lots acceptance based
on the specification.
Transaction Project Examples
Sales and Marketing
• Motorola employed Six Sigma methodology to improve its prospect
success rate. The company tracked prospects and monitored marketing
activities received (emails, website, etc.). By keeping a database of
activities for each prospect, Motorola calculated the types of marking
efforts generating the best customer responses.
• A home appliance company was facing a high number of “no-fault found” problem.
This occurs when a repair technician is send to look into a fault reported by a customer
and found out that it is not a real fault.After collecting the data to understand the
problem, an effective solution was found. The solution is to get the receptionists to filter
out the “non-fault” problems. Thos involves training the receptionists to clarify the type
of faults reported by the customers and be able to explain to customers on how to
operate the appliance correctly over the phone.
Banking and Finance
Source : baldrigeplus.com
Finance, Purchasing and Logistics
• A hospital form a team to improve the patients discharge process. Many patients
called back the hospital to clarify information on medication, follow-up appointment,
etc. Each time a patient called,the nurses need to spent a substantial amount of time to
retrieve the file, review the files and answer the enquiries. If the patient discharge
process is done right the first time,the patients should not need to call back. Using Six
Sigma methodology, the team reduced the number of call backs.
Section 3
Six Sigma Implementation
The Six Sigma Leap
2 3 4 5 6
Sigma Sigma Sigma Sigma Sigma
Six Sigma Implementation Stages
Executive Briefing & Initial Assessment
Alignment
• Follow – up on:
- results
- effectiveness of the approach
- extent of deployment
AlliedSignal
Our Vision
We will be one of the world’s premier companies,
distinctive and successful in everything we do.
Our Commitment
We will become a Total Quality Company by
continuously improving all our work processes
to satisfy our internal and external customers.
Iomega
How did we decide on Six Sigma?
We recognize the need for a change in the way we pursue operational
excellence.
VISION
PASSION
ACTION
Guiding Principle for New Work Habit
• Want To Do.
- appreciate the purpose
- understand ‘what is in it for me’
• What To Do.
- approach framework / model
- role and responsibility
• How To Do.
- process
- tools
Six Sigma Deployment Committee
• Tasked by Senior Executives to implement
Six Sigma in the organization.
• Responsibilities:
- promoting - monitoring
- planning - evaluating
- coordinating - reporting
- controlling - recommending
Master Black Belts
Role
• Lead Six Sigma implementation committee.
• Adviser to senior executives team and champions.
• Instructor of Six Sigma training courses.
• Coach for Black Belts and Green Belts.
Profile
• Business / technical degree, management experience.
• Respected member of management.
• Master of Six Sigma principles and practices.
Champions’ Role
• Lead the implementation of Six Sigma in their areas.
~75%
~50%
Black Belt
Green Belt
Yellow Belt
• Personnel Selection.
• Project Selection.
• Financial Benefits Calculation.
• Project Tracking System.
• Black Belt Certification.
• Incentive Scheme.
Projects Tracking System
Information to be tracked:
• Total number of projects.
• The numbers of completed projects and
on-going projects.
• The status of each on-going project.
• Targeted financial benefits and actual
financial benefits to date.
Projects Review
Objectives:
2. Ensure projects proceed as plan.
3. Present the findings of each phase.
4. Make sure the vigor of Six Sigma
approach is maintained.
6. Discuss the barriers faced.
7. Check correct applications of tools.
Six Sigma Critical Success Factors
• The link of Six Sigma to business strategy is clear.
• Recognize and manage Six Sigma as a change
initiative.
• Understand that Six Sigma is a management
approach, not just a problem solving tool.
• Identifying the right focus areas for Improvement.
• Selection of key personnel.
• Diligent and disciplined use methodology, fact and
data.
Section 4
Collective Decision Making
Why Make Decision Collectively?
• A good decision has two basic components: quality and
commitment.
• A quality decision takes into account all of the facts and
viewpoints, and makes good use of that information.
• When decision is made4 on a collective basis, it pulls
together the skills, knowledge, experience, and opinions
of several people. This produces a decision that is usually
better than the decisions made by individuals.
• Knowing how to make collective decision effectively is an
important skill to an organization.
Benefits of Collective Decision Making
B. Round-Robin
- Everyone takes a turn offering an idea.
- Anyone can pass on any turn.
- Continue until there are no more ideas.
- All ideas listed as they are offered.
Multi-voting
• A tool for short listing key ideas.
• To reduce a long list of items to a manageable
number of items.
• Identifying the most popular or highest priority
items to a group a people.
Hardware Environment
Section 5
Define: Set Up Projects
and Deploy Teams
Project Selection Process-Overview
Project Ideas Sources Performance Voice of Cost Reduction
Gap Customer Initiative
Competitive Issues of
Pressure Concern
Project Ideas Sources
Project
Project Ideas Sources Charters
CTQ Drill Down — A General Framework
• Clarify Business Goals and identify key performance
drivers that impact the business goal.
1. Capacity Utilization
2. Inventory Turns
3. Cost of Poor Quality
Example : CTQ Tree Sales Orders Sales Lead Time
On Time Delivery
Order Fulfillment
Customer Complaints
Increase Sales Production Output Process Yield
Down Time
Process Efficiency
New Products Time to Market
Market Success Rate
Design Changes
Fulfillment Rate:
Order Fulfillment Number of ordered items delivered on time
over total number of ordered items ( % ).
Cycle Time:
Lead Time Time interval from order received to
product / service delivery (days).
Criteria of Good Measures
• Direct
Relate directly to the characteristic being assessed.
• Exact
Can be observed or measured.
2003 Goal
J F M A M J J A S O N D
Step 5: Brainstorm the Causes that Drive the Measures.
Fill the Cause and Effect Diagram with data ( if available ).
Purchasing Others
System Supplies
Step 6: Discuss the relationship between the causes (X’s) and the effect
(Y)
to identify vital few factors that drive the measures. For the vital
few causes. identify project ideas that will move the effect (Y) to
the desired level.
Purchasing Others
System Supplies
Step 7: Apply Project Assessment Matrix to the Prioritize
Project Ideas.
• Probability of success
• Estimated duration
• Effort Required
• Estimated cost
The 3 Conditions for a Six Sigma Project
• A gap exists between current and the desired
performance.
• Right project
• Right team composition
• Right team process
Right Result
Right Project
• Well selected
- Address important business issue.
• Well scoped
- Focus on specific problem or process.
• Well defined
- Comprehensive and clear instruction, not a vague idea.
Project Charter
• Project Charter is a document created at the outset of a project to
formally assign the project to the team.
• It is an important tool for giving clear instruction and getting
commitment from the project team.
• A Project Charter provides the following information:
- Project title.
- The process to be improved.
- The business case.
- The problem statement and goal statement.
- Estimated financial benefits.
- Name of Champion, team leader and members.
- Project time line.
Project Title
• A brief description of the project.
• An idea on what the project is about
Examples:
Examples:
• Sales orders handling
• Multi-layer circuit board lamination
• Funds transfer transactions
• Pick and place process
Business Case
• A broad statement on the business issue pertaining to the
project.
• Provides the rationale on why the project should be a business
priority.
Examples:
Examples:
• Sales for product A has fallen by 20% since last year.
• The mis-registration defect rate has increased to 7% since
last month.
• The turn-around-time of competitor A is 5 days faster than
ours.
Goal Statement
• A description on what is to be achieved.
Examples:
Analyze
Improve
-------------------------------------------------------------
Control C] Project Closure: Confirm estimated figure
based on actual improvement achieved.
Saving Items - Examples
• Cost Reduction - Direct Savings • Cost Avoidance
- Material saving - Investment avoidance as a result
of increased productivity / capacity
- Reduced concession / warranty
- Expense avoidance as a result of
- Direct labor savings preventative measures
- Reduced scraps and reworks
- Expedited freight cost reduction • Incremental Revenue
- Increased sales volumes
• Cost Reduction - Indirect Savings - Contribution margin enhancement
- Time savings for indirect • Working Capital Reduction
employees - Inventory reduction
- Reduced administrative effort - Receivables reduction
Financial Benefit Guidelines
• Guidelines are necessary for: