Six Sigma
Focus Group Meeting
Dr K. M. Madrecha
Projects & Quality Manager
The Kanoo Group – UAE & Oman
&
Consultative Committee Member
Supply Chain & Logistics Group
Quality History in the Industrial World
• 1787 - Concept of Interchangeability introduced.
• 1870 - Concept of tolerance
• 1900 - Concept of standardization
• 1930 - National standardization organisations
– 1901 UK,
– 1920 Belgium, Canada, France, US…etc.
– 1930s Most of the industrial countries
• 1920s-30s Development of SQC and SPC in Bell Labs
and Western Electric
– 1924 Walter Shewhart developed Control Charts
– Herold Dodge & Harry Romig developed sampling
techniques.
• 1940s - Deming applied sampling and control chart
techniques in computer operations in US Census.
• 1950s- Deming’s thinking reaches Japan
Quality History in the Industrial World
• 1970-80s - TQM movement takes hold, national
Quality Awards established
• 1987 - ISO 9000 family of standards published.
– 1994 - First revision of ISO 9000 standards.
– 1996 - ISO 14001 published
• Early 1990s Business Process Re-engineering
movement became popular
• 1995-2000 - Development of the Internet, e-business
• 2000 - Major revision of ISO 9000 standards
Build Up of Quality in Japanese Industry
(L.P.Sullivan, “The Seven Stages in
Company-Wide Quality Control”,
100% Quality Progress, May 1986 p 77, ASQC)
7: Customer Oriented (1990s)
(QFD, deploying voice of the
customer in operational terms)
6: Cost Oriented (1970s-80s)
(Product and process designing for robustness
CWQC based on DOE)
5: Society Oriented (1950s-60s)
(Product and process designing based on DOE)
4: Humanistic
(Education and Training to all employees)
40%
TQC 3: System Oriented (Quality Management Systems covering all departments,
ie. Design, manufacturing, sales & service)
2: Process Oriented (1950s)
(QA during production processes including SPC and fool proofing)
1: Product Oriented (Upto 1940s)
0% (Inspection after production, audits of finished products and problem solving activities)
The Kaizen View
Change required
Maintenance
Innovation without Kaizen
Change required
Kaizen + Innovation
Time
(Adopted from Masaki Imai (1991), McGraw -Hill, pp 26-27)
Six Sigma
What is Six Sigma?
• A statistical measure for determining process capability
(Six Sigma equates to 3.4 defects/million opportunities)
• A proven set of tools and tactics for reducing variation
• A successful business strategy (used by Motorola, Texas
Instruments and Allied Signal)
• A comprehensive philosophy about operational excellence
• A disciplined process for identifying sources of variation /
defects in a process; minimizing or eliminating that variation
or those defects; and ensuring improvements stay in place.
Six Sigma is a Proven,
Data-Driven Method for Improving Processes
TQM vs Six Sigma
TQM Six Sigma
• Lack of integration with • Links to the business and
business strategy personal “bottom line”
• Leadership apathy • “Leadership” leadership
• A fuzzy concept • A “branded” concept
• Unclear goals • Clearly identified “status”
• Too technical approach • “Glamour” oriented approach
• Failure to break bureaucracy • Populist form
• Emphasis on incremental • Equal emphasis on
change incremental and radical change
• Ineffective training • “Branded” training
• Focus on technical • Improvement in all processes
processes (production,
design)
BPR vs Six Sigma
BPR Six Sigma
• Too radical to digest • Participatory, people oriented
• Traumatic • Enhances personal esteem of
• Anti-people employees
• In practice internal cost • Radical changes achievable
focus • Customer focus
TQM Six Sigma BPR
Implementing Change
Change Initiative
Focused On
Customer Needs
(Target)
The Challenge: Do it with Speed
Six Sigma Roadmap
• Identify Core Processes and Key Customers
• Define Customer Requirements (CTQs)
• Measure Current Performance
• Prioritise, analyse and implement improvements
• Expand and integrate
Understanding the Output
17
Jan 42
61
58
CUSTOMER’S VIEW
79
Time 32
57
(days) 118
42 0 25 50 75 100 125
48
49 Min = 17
Feb 58
62
Max = 118
86
58
46
76
86
104
29
59
45 GE’s VIEW
Mar 69
47
67
56
66
55 0 25 50 75 100 125
25
43
53
Average 53 Capture What The Customer Sees
- The Entire Distribution Of Y Values
SIPOC
• Supplier
• Input
• Process
• Output
• Customer
Five Phase Improvement Process
(DMAIC)
Define 1. What is important to the customers?
(survey / interview / inquiries)
Measure 2. What is the frequency of defects?
(measurement system / process mapping / sigma
rating)
Analyze 3. When, where and why do defects occur?
(statistics / pareto / FMEA / benchmarking / etc...)
Improve 4. How can we improve the process?
(design of experiments / expert brainstorming / etc...)
Control 5. How can we maintain the process improvement?
(measurement feedback control / procedural / etc...)
A Rigorous, Customer-Focused Improvement Process 14
What Is Six Sigma? Definitions
• Customer
Anyone Who Receives
Product, Service or Information
• Opportunity
Every Chance to Do Something Either
“Right” or “Wrong”
• Successes vs. Defects
Every Result of an Opportunity Either Meets the
Customer Specification or it Doesn’t
GE Company Proprietary
November 1998
Why 99% Isn’t Good Enough
“99% Good” The Six Sigma Goal
20,000 pieces mail lost per hour s Defects % Good
Unsafe drinking water almost 15 2 308,537 68%
minutes out of each day
3 66,807 93%
2 short or long landings at most
4 6,210 99%
major airports each day 5 233 99.99%
6 3.4 99.9997%
No electricity for almost 7 hours
each month
99% Isn’t Good Enough!
Bull’s Eye
Off-Center Too Much Spread
X
X X
X XXX X X
X
XXX X X X
XX X X
X X
X
X X X
Centered X
On-Target X
X
X XXX
Center XXX X X Reduce
XX X X
Process Spread
The Objective of Six Sigma is to
Identify & Reduce Variation
What Is Six Sigma? Process
Philosophy
?
• Know What’s Important
to the Customer (CTQ)
• Reduce Defects (DPMO)
• Centre Around Target
(Mean)
• Reduce Variation
(Standard Deviation)
GE Company Proprietary
November 1998
T
With Normal Curves...
Off-Centre Too Much Spread
Target Target
LSL USL LSL USL
Centred
Defects On-Target
Target
Center Reduce
Process Spread
LSL USL
Reduced Variation Results in Fewer
Defects & Higher Process Yields
The Six Sigma Journey
Six Sigma Quality at GE
Lynn Fergusson
Manager, Corporate Initiatives
GE Canada
Work-Out: Stages of GE's Culture Change
high
Six Sigma Quality
Key Strategic Initiatives:
QMI*, NPI*, OTR*, SP*, Productivity, Globalization
Intensity
of Change Acceleration Process:
Change increase success and accelerate change
Process Improvement: Bullet Train Approach
continuous improvement, re-engineering
Productivity / Best Practices: Best Practice Sharing
looking outside GE
Work-Out / Town Meetings: Action Work-Outs
Customized Work-Outs
low empowerment, bureaucracy busting, action
* New Product Introduction
Quick Market Intelligence
Time
Order to Remittance
Supplier Partnership r 6/3/96
From Our CEO...
“...this Six Sigma journey will
change the paradigm from fixing
products so they are perfect to
fixing processes so that they
produce nothing but perfection,
or close to it.”
-Jack Welch
22
Key Six Sigma Roles
Champion Senior management with clout and credibility
responsible for the success of the Quality initiative
Master Black Belt Teachers, Trainers, Reviewers and Mentors of
Black Belts (Full Time)
Black Belt Leaders of the teams that conduct Six Sigma
projects (Full Time)
Green Belt Six Sigma project leaders (Part Time)
Team Members Key participants in Black Belt projects gathering
data and implementing process improvements
All Employees Involved
Six Sigma Organisation
Master Black Belts Sponsors/
(Coach,
support Champions
project leaders) (Select, (Recognise people,
Oversee, maintain
guide projects) momentum/morale)
Black Belts Green Belts/
(Lead projects Team Leaders
to success) (Lead projects
to success)
GBs/Team
members
(Suggest projects,
Analyse/experiment,
implement solutions)
Training
All Professional Employees GB Trained By Early 1999
Trained GE Employees
100% 100%
100% 90%
80% Six Sigma
Trained
60%
60%
40%
Green Belts
20%
15%
0% MBB’s & BB’s
1996 1997 1998 1999 2000
Explosive Growth In Green Belts
And Six Sigma Trained Employees
Projects
Completed Projects Will
55000
Reach 55,000 by 2000
47000
37000
20,000 More
Projects in 98
17000
1997 1998 1999 2000
Project Completion Drives Six Sigma Learning
Six Sigma Costs and Benefits
($ Millions) 3500
3000 Cost
2500
2000 GE
Benefits
1500
Customer
1000 Impact
500
0
9 6 9 7 9 8 9 9 0 E 1 E
19 19 19 19 2 00 2 00
Benefit/ 1996 1997 1998 1999
Cost Ratio 0.9 1.8 ~2.5 ~5
Future Benefits Include Emphasis on Customer Impact 27
Further Quality Initiatives at GE
Six Sigma @ the Customer – emphasis on becoming
more customer centric; BBs at customer sites to help customers
improve their processes and for GE to gain better insights about
our customers
Six Sigma Customer Centric Metrics –
communicate customer metrics to employees on an on-going
basis along with how our processes are impacting the customer’s
metrics
Six Sigma in GE’s Fulfillment Process – focus
on common metrics, measure the same way with emphasis on
optimizing process against customer requests
Six Sigma in e-Business – focus on understanding e-
Business and e-Commerce capabilities
In Summary...
The Keys to A Successful
Six Sigma Strategy Include:
Customer - Focus on the Customer
Process - Look at the Process from the
Customers’ Perspective - “Outside-In
Thinking”
Employees - Leadership Commitment
Six Sigma Must Become Part of the Culture
Example of Six Sigma in KM
•Quotation Timeliness in KM @ 2.95 sigma, DPMO = 73,873
•Delivery Timeliness in KM is @ 2.38 sigma, DPMO= 189,801
(* Period May-August, 2001)
The Way Forward?
•………………………………………………..
•………………………………………………..
Thank You!