Docstoc
EXCLUSIVE OFFER FOR DOCSTOC USERS
Try the all-new QuickBooks Online for FREE.  No credit card required.

Six Sigma info

Document Sample
Six Sigma info Powered By Docstoc
					http://www.isixsigma.com/library/content/six-sigma-newbie.asp




The History of Six Sigma
The roots of Six Sigma as a measurement standard can be traced back to Carl Frederick Gauss
(1777-1855) who introduced the concept of the normal curve. Six Sigma as a measurement
standard in product variation can be traced back to the 1920's when Walter Shewhart showed
that three sigma from the mean is the point where a process requires correction. Many
measurement standards (Cpk, Zero Defects, etc.) later came on the scene but credit for coining
the term "Six Sigma" goes to a Motorola engineer named Bill Smith. (Incidentally, "Six Sigma" is a
federally registered trademark of Motorola).
In the early and mid-1980s with Chairman Bob Galvin at the helm, Motorola engineers decided
that the traditional quality levels -- measuring defects in thousands of opportunities -- didn't
provide enough granularity. Instead, they wanted to measure the defects per million opportunities.
Motorola developed this new standard and created the methodology and needed cultural change
associated with it. Six Sigma helped Motorola realize powerful bottom-line results in their
organization - in fact, they documented more than $16 Billion in savings as a result of our Six
Sigma efforts.
Since then, hundreds of companies around the world have adopted Six Sigma as a way of doing
business. This is a direct result of many of America's leaders openly praising the benefits of Six
Sigma. Leaders such as Larry Bossidy of Allied Signal (now Honeywell), and Jack Welch of
General Electric Company. Rumor has it that Larry and Jack were playing golf one day and Jack
bet Larry that he could implement Six Sigma faster and with greater results at GE than Larry did
at Allied Signal. The results speak for themselves.
Six Sigma has evolved over time. It's more than just a quality system like TQM or ISO. It's a way
of doing business. As Geoff Tennant describes in his book Six Sigma: SPC and TQM in
Manufacturing and Services: "Six Sigma is many things, and it would perhaps be easier to list all
the things that Six Sigma quality is not. Six Sigma can be seen as: a vision; a philosophy; a
symbol; a metric; a goal; a methodology." We couldn't agree more.

Where did the name "Six Sigma" come from?

In my recollection, two recurring questions have dominated the field of six sigma. The first
inquiry can be described by the global question: “Why 6s and not some other level of capability?”
The second inquiry is more molecular. It can be summarized by the question: “Where does the
1.5s shift factor come from – and why 1.5 versus some other magnitude?” For details on this
subject, reference: “Harry, M. J. “Resolving the Mysteries of Six Sigma: Statistical Constructs
and Engineering Rationale.” First Edition 2003. Palladyne Publishing. Phoenix, Arizona. (Note:
this particular publication will be available by October 2003). But until then, we will consider the
following thumbnail sketch.

At the onset of six sigma in 1985, this writer was working as an engineer for the Government
Electronics Group of Motorola. By chance connection, I linked up with another engineer by the
name of Bill Smith (originator of the six sigma concept in 1984). At that time, he suggested
Motorola should require 50 percent design margins for all of its key product performance
specifications. Statistically speaking, such a "safety margin" is equivalent to a 6 sigma level of
capability.

When considering the performance tolerance of a critical design feature, he believed a 25
percent “cushion” was not sufficient for absorbing a sudden shift in process centering. Bill
believed the typical shift was on the order of 1.5s (relative to the target value). In other words, a
four sigma level of capability would normally be considered sufficient, if centered. However, if the
process center was somehow knocked off its central location (on the order of 1.5s), the initial
capability of 4s would be degraded to 4.0s – 1.5s = 2.5s. Of course, this would have a
consequential impact on defects. In turn, a sudden increase in defects would have an adverse
effect on reliability. As should be apparent, such a domino effect would continue straight up the
value chain.

Regardless of the shift magnitude, those of us working this issue fully recognized that the initial
estimate of capability will often erode over time in a “very natural way” – thereby increasing the
expected rate of product defects (when considering a protracted period of production). Extending
beyond this, we concluded that the product defect rate was highly correlated to the long-term
process capability, not the short-term capability. Of course, such conclusions were predicated on
the statistical analysis of empirical data gathered on a wide array of electronic devices.

Thus, we come to understand three things. First, we recognized that the instantaneous
reproducibility of a critical-to-quality characteristic is fully dependent on the “goodness of fit”
between the operating bandwidth of the process and the corresponding bandwidth of the
performance specification. Second, the quality of that interface can be substantively and
consequentially disturbed by process centering error. Of course, both of these factors profoundly
impact long-term capability. Third, we must seek to qualify our critical processes at a 6s level of
short-term capability if we are to enjoy a long-term capbility of 4s.

By further developing these insights through applied research, we were able to greatly extend
our understanding of the many statistical connections between such things as design margin,
process capability, defects, field reliability, customer satisfaction, and economic success.



Six Sigma Evolution Clarified - Letter To The
Editor
By Daniel T. Laux
On behalf of Six Sigma Academy, I would like to take this opportunity to clarify the evolution of six
sigma since this seems to be a lively topic of conversation among many practitioners (even
cartoonists!) these days.
The roots of six sigma as a measurement standard can be traced back to Carl Frederick Gauss
(1777-1855) who introduced the concept of the normal curve. Six sigma as a measurement
standard in product variation can be traced back to the 1920's when Walter Shewhart showed
that three sigma from the mean is the point where a process requires correction. Many
measurement standards (Cpk, Zero Defects, and so on) later came on the scene but credit for
coining the term "six sigma" goes to a Motorola engineer named Bill Smith (six sigma is a
federally registered trademark of Motorola).
In the late 1970's, Dr. Mikel Harry, a senior staff engineer at Motorola's Government Electronics
Group (GEG), began to experiment with problem solving through statistical analysis. Using his
methodology, GEG began to show dramatic results – GEG's products were being designed and
produced faster and more cheaply. Subsequently, Dr. Harry began to formulate a method for
applying six sigma throughout Motorola. His work culminated in a paper titled "The Strategic
Vision for Accelerating Six Sigma Within Motorola." He was later appointed head of the Motorola
Six Sigma Research Institute and became the driving force behind six sigma.
Dr. Mikel Harry and Richard Schroeder, an ex-Motorola executive, were responsible for creating
the unique combination of change management and data-driven methodologies that transformed
six sigma from a simple quality measurement tool to the breakthrough business excellence
philosophy it is today. They had the charisma and the ability to educate and engage business
leaders such as Bob Galvin of Motorola, Larry Bossidy of AlliedSignal (now Honeywell), and Jack
Welch of GE. Together, Harry and Schroeder elevated six sigma from the shop floor to the
boardroom with their drive and innovative ideas regarding entitlement, breakthrough strategy,
sigma levels, and the roles for deployment of Black Belts, Master Black Belts, and Champions. In
effect, they created a business revolution that continues to challenge the thinking of executives,
managers and employees alike. Their strategies and tools have been perfected through the years
by Six Sigma Academy. In brief, we believe our contribution was the unique combination of
business leadership plus quality and process improvement tools and techniques which made it
possible for leaders to recognize the value of six sigma, not just as a tool for operational
efficiency, but as an enterprisewide business strategy with direct bottom line impact.
Having said all that, I believe every six sigma practitioner, consulting firm, and black belt has
contributed to the evolution of six sigma. We should therefore focus our time and resources, not
on diatribes about who can claim credit for six sigma, but rather on continuously improving upon
the strategies and tactics to achieve breakthrough results in business excellence. For example,
six sigma has been indisputably successful in eliminating waste, reducing variance and
increasing productivity and profits. But its potential to create new business models for growth and
innovation is barely tapped. I urge all of us to take six sigma to the next level by being thought
leaders inspiring creativity and originality in our successors, instead of simply regurgitating what
others have said before us. Doing so will ensure six sigma will become the global standard for
conducting business, not just another management trend doomed to fall by the wayside.
There is a hill to scale ahead of us, and enough oxygen for everyone. It is incumbent upon all of
us to blaze a trail toward the next frontier of six sigma and demonstrate the leadership
businesses are clamoring for.
Sincerely,
Daniel T. Laux
President
Six Sigma Academy
About The Author
Mr. Laux is president of Six Sigma Academy. Prior to being named president in June 2000, Mr.
Laux served as Sigma Consultants' Chief Operating Officer, and served as Six Sigma Academy's
financial advisor since 1994. Preceding his tenure at the Academy, Mr. Laux spent 11 years with
Merrill Lynch's Private Client Group, serving in numerous advisory positions. Mr. Laux is a
graduate of Arizona State University with a Bachelor of Science degree in Finance.



Remembering Bill Smith, Father Of Six Sigma
By Gail C. Chadwick, iSixSigma Staff Writer
Bill Smith spent years convincing higher-ups that he really had invented a better mousetrap. Then
he spent the rest of his life spreading the word to business professionals, government leaders
and educators.
Smith's mousetrap? It was Six Sigma, the TQM spin off that has generated billions of dollars for
Motorola, the company where Smith introduced his statistical approach aimed at increasing
profitability by reducing defects. Smith, who earned the appellation, Father of Six Sigma, would
probably be tickled to know Six Sigma has become so mainstream that it even appears
periodically in the widely syndicated comic strip, Dilbert.
As a Motorola employee, Smith did not share directly in the profits generated by the company's
Six Sigma applications. However, over the years, he and Motorola garnered numerous awards
and recognition for his vital work to improve profitability in America's manufacturing sector. He
was especially proud of his role in Motorola's winning the prestigious Malcolm Baldrige National
Quality Award. The Baldrige Award came in 1988, two years after Motorola implemented Smith's
Six Sigma principles.
Smith's death, only five years later, caught everyone by surprise. He died of a heart attack at
work.
Daughter Marjorie Hook, now 37 and president of Clarksville Consulting Group in Austin, Texas,
developed an affinity for Six Sigma and occasionally collaborated with her father for a few years
after college. Hook said winning the Baldrige Award stands out as a career high point in her
father's life.
"He was thrilled that a good thing was happening to Motorola and that Six Sigma had made such
a difference," she said. "He drafted Six Sigma long before [Motorola Executive Committee
Chairman] Bob Galvin ever took it on board. So, for him, it was the culmination of so many years
of work and trying to change the way people think about things. He finally had some phenomenal
success at Motorola and he was getting great recognition for it."
Baldrige Award winners agree to share their quality programs with anyone who is interested.
Hook said that since Motorola was the first company to win, others were eager to learn more
about Six Sigma. "That's one of the primary reasons Six Sigma became so widely known," she
said.
"He got to spend the last few years of his life traveling around, teaching and introducing Six
Sigma to people," Hook said. "He was so appreciated wherever he went and people were really
interested in it. When others started using Six Sigma and seeing results just like Motorola had, he
was thrilled."
Not surprisingly, the man behind the methodology was a passionate visionary and a great
communicator. Bill Smith was also a perfectionist. Even at home.
"But not in an annoying way," Hook said. "He just did everything the right way because that was
the way to do it.
"I think that was just a natural part of his character," she said. "It came through when he was
repairing a watch or helping us with a science project or fixing a car or learning to play a musical
instrument - he was incredibly talented. He knew how to do absolutely everything."
Hook said he always approached projects methodically and drafted a plan, either on paper or in
his mind. "He planned things out, making sure we had the skills and the tools, doing it, and then
following through with the cleaning up," Hook said. "Everything had to be done in a complete way.
Nothing was ever done sort of off-hand. The standard was always so high."
Bill Smith also made the most of leisure time. He and his wife, Betty, shared a love of music,
especially when they were the musicians, she on the piano and he on the organ at their
Barrington, Illinois home. However, she suspects he bought her a new baby grand piano to keep
her occupied while he devoted spare time to working out statistical programs on his computer.
"One time when he was home in the evening, he had an idea of trading stock options," Betty
Smith recalled. "So he would do it on paper and then on the computer for awhile to see how it
would work. And it worked very well. Imagine that!"
Bill Smith also used his computer to develop a program that would help him predict winning
racehorses. Betty Smith said he programmed a calculator with data about the horses racing at
Arlington International Racecourse in Arlington Heights, Illinois. "By golly, I think we won eight of
the first nine, and people were following us around," she said.
The Smiths soon joined a half-dozen others in a horse-owning partnership, embarking on a
lifelong hobby. "We had six horses when he died," Betty Smith said. "They were ours, not part of
a partnership. In the beginning, it was lucrative. I think one horse won most of the money. After
Bill died, I got rid of all the horses except one. Her grandfather was Seattle Slew, the famous
1977 Triple Crown winner."
Born in Brooklyn, New York, in 1929, Bill Smith graduated from the U.S. Naval Academy in 1952
and studied at the University of Minnesota School of Business. In 1987, after working for nearly
35 years in engineering and quality assurance, he joined Motorola, serving as vice president and
senior quality assurance manager for the Land Mobile Products Sector.
In honor of Smith's talents and dedication, Northwestern University's Kellogg Graduate School of
Management established an endowed scholarship in Smith's name. Dean Donald P. Jacobs of
the Kellogg School notified Motorola's Robert Galvin of the school's intention less than a month
after Smith died. "Bill was an extremely effective and inspiring communicator," Jacobs wrote in
his July 27, 1993, letter. "He never failed to impress his audience by the depth of his knowledge,
the extent of his personal commitment, and the level of his intellectual powers." The school
created the scholarship fund in recognition of Smith's "contributions to Kellogg and his dedication
to the teaching and practice of quality."
It was a fitting tribute to a man who influenced business students and corporate leaders
worldwide with his innovative Six Sigma strategy.
As the one who followed most closely in his footsteps, Marjorie Hook is well-positioned to
speculate about Bill Smith's take on the 2003 version of Six Sigma. "Today I think people
sometimes try to make Six Sigma seem complicated and overly technical," she said. "His
approach was, 'If you want to improve something, involve the people who are doing the job.' He
always wanted to make it simple so people would use it."
And would he approve of Six Sigma's evolution? "He'd be thrilled," Hook said.



Six Sigma Costs And Savings
The financial benefits of implementing Six Sigma at your company can be
significant.
By Charles Waxer
Many people say that it takes money to make money. In the world of Six Sigma quality, the
saying also holds true: it takes money to save money using the Six Sigma quality methodology.
You can't expect to significantly reduce costs and increase sales using Six Sigma without
investing in training, organizational infrastructure and culture evolution.
Sure you can reduce costs and increase sales in a localized area of a business using the Six
Sigma quality methodology -- and you can probably do it inexpensively by hiring an ex-Motorola
or GE Black Belt. I like to think of that scenario as a "get rich quick" application of Six Sigma. But
is it going to last when a manager is promoted to a different area or leaves the company?
Probably not. If you want to produce a culture shift within your organization, a shift that causes
every employee to think about how their actions impact the customer and to communicate within
the business using a consistent language, it's going to require a resource commitment. It takes
money to save money.
How much financial commitment does Six Sigma require and what magnitude of financial benefit
can you expect to receive? We all have people that we must answer to -- and rhetoric doesn't pay
the bills or keep the stockholders happy (anymore). I was tired of reading web pages or hearing
people say:

         "Companies of all types and sizes are in the midst of a quality revolution. GE saved $12 billion over
         five years and added $1 to its earnings per share. Honeywell (AlliedSignal) recorded more than $800
         million in savings."

         "GE produces annual benefits of over $2.5 billion across the organization from Six Sigma."

         "Motorola reduced manufacturing costs by $1.4 billion from 1987-1994."

         "Six Sigma reportedly saved Motorola $15 billion over the last 11 years."


The above quotations may in fact be true, but pulling the numbers out of the context of the
organization's revenues does nothing to help a company figure out if Six Sigma is right for them.
For example, how much can a $10 million or $100 million company expect to save?
I investigated what the companies themselves had to say about their Six Sigma costs and
savings -- I didn't believe anything that was written on third party websites, was estimated by
"experts," or was written in books on the topic. I reviewed literature and only captured facts found
in annual reports, website pages and presentations found on company websites.
While recent corporate events like the Enron and WorldCom scandals might lead us to believe
that not everything we read in a company's annual report is valid, I am going to provide the
following information based on the assumption that these Six Sigma companies operate with
integrity until proven otherwise.
I investigated Motorola, Allied Signal, GE and Honeywell. I choose these four companies because
they are the companies that invented and refined Six Sigma -- they are the most mature in their
deployments and culture changes. As the Motorola website says, they invented it in 1986. Allied
Signal deployed Six Sigma in 1994, GE in 1995. Honeywell was included because Allied Signal
merged with Honeywell in 1999 (they launched their own initiative in 1998). Many companies
have deployed Six Sigma between the years of GE and Honeywell -- we'll leave those companies
for another article.
Table 1: Companies And The Year They Implemented Six Sigma

Company Name                                      Year Began Six Sigma

Motorola (NYSE:MOT)                               1986

Allied Signal (Merged With Honeywell in 1999) 1994

GE (NYSE:GE)                                      1995

Honeywell (NYSE:HON)                              1998

Ford (NYSE:F)                                     2000

Table 2 identifies by company, the yearly revenues, the Six Sigma costs (investment) per year,
where available, and the financial benefits (savings). There are many blanks, especially where
the investment is concerned. I've presented as much information as the companies have publicly
disclosed.
Table 2: Six Sigma Cost And Savings By Company

                                                         % Revenue                        % Revenue
Year            Revenue ($B)      Invested ($B)                          Savings ($B)
                                                          Invested                         Savings

Motorola
                                                                                  1
1986-2001        356.9(e)              ND                     -              16              4.5

Allied Signal
                                                                                      2
1998               15.1               ND                      -             0.5              3.3

GE

1996               79.2               0.2                    0.3             0.2             0.2

1997               90.8               0.4                    0.4              1              1.1

1998               100.5              0.5                    0.4             1.3             1.2

1999               111.6              0.6                    0.5              2              1.8
                                                                                      3
1996-1999          382.1               1.6                   0.4            4.4              1.2

Honeywell

1998               23.6               ND                      -              0.5             2.2

1999               23.7               ND                      -              0.6             2.5

2000               25.0               ND                      -              0.7             2.6
                                                                                      4
1998-2000           72.3               ND                     -             1.8              2.4

Ford

2000-                                                                             6
                   43.9               ND                      -              1               2.3
2002

Key:
$B = $ Billions, United States
(e) = Estimated, Yearly Revenue 1986-1992 Could Not Be Found
ND = Not Disclosed
Note: Numbers Are Rounded To The Nearest Tenth

Although the complete picture of investment and savings by year is not present, Six Sigma
savings can clearly be significant to a company. The savings as a percentage of revenue vary
from 1.2% to 4.5%. And what we can see from the GE deployment is that a company shouldn't
expect more than a breakeven the first year of implementation. Six Sigma is not a "get rich quick"
methodology. I like to think of it like my retirement savings plan -- Six Sigma is a get rich slow
methodology -- the take-away point being that you will get rich if you plan properly and execute
consistently.
As GE's 1996 annual report states, "It has been estimated that less than Six Sigma quality, i.e.,
the three-to-four Sigma levels that are average for most U.S. companies, can cost a company as
much as 10-15% of its revenues. For GE, that would mean $8-12 billion." With GE's 2001
revenue of $111.6 billion, this would translate into $11.2-16.7 billion of savings. Although $2
billion worth of savings in 1999 is impressive, it appears that even GE hasn't been able to yet
capture the losses due to poor quality -- or maybe they're above the three-to-four Sigma levels
that are the average for most U.S. companies?
In either case, 1.2-4.5% of revenue is significant and should catch the eye of any CEO or CFO.
For a $30 million a year company, that can translate into between $360,000 and $1,350,000 in
bottom-line-impacting savings per year. It takes money to make money. Is investing in Six Sigma
quality, your employees and your organization's culture worth the money? Only you and your
executive leadership team can decide the answer to that question.
References:
1. Motorola Six Sigma Services. Motorola University. 22 July 2002
<http://mu.motorola.com/sigmasplash.htm>.
2. AlliedSignal Inc. 1998 Annual Report. Honeywell Inc. 22 July 2002
<http://www.honeywell.com/investor/otherpdfs/ALD98.pdf>.
3. GE Investor Relations Annual Reports. General Electric Company. 22 July 2002
<http://www.ge.com/company/investor/annreports.htm>.
4. Honeywell Annual Reports. Honeywell Inc. 22 July 2002
<http://investor.honeywell.com/ireye/ir_site.zhtml?ticker=HON&script=700>.
5. Better Understand Six Sigma Plus With Honeywell's Special PowerPoint Presentation.
Honeywell Inc. 22 July 2002 <http://www.honeywell.com/sixsigma/page4_1.html>.
6. Quality Digest, "Six Sigma at Ford Revisited", June 2003, p. 30.
<http://www.qualitydigest.com/june03/articles/02_article.shtml>.




            Six Sigma Organizational Architecture
            By Charles Waxer
             Six Sigma is a quality methodology that can produce significant benefit to businesses
             and organizations. Not much text, however, has been written about the structure
             needed to successfully implement Six Sigma quality within your business or
             organization. This article will focus on roles and responsibilities, as well as required
             rewards and recognition for a successful Six Sigma quality program.
             Roles and Responsibilities
             Quality Leader/Manager (QL/QM) - The quality leader's responsibility is to represent
             the needs of the customer and to improve the operational effectiveness of the
             organization. The Quality function is typically separated from the manufacturing or
             transactional processing functions in order to maintain impartiality. The quality
             manager sits on the CEO/President's staff, and has equal authority to all other direct
             reports.
Master Black Belt (MBB) - Master Black Belts are typically assigned to a specific area or
function of a business or organization. It may be a functional area such as human resources or
legal, or process specific area such as billing or tube rolling. MBBs work with the owners of the
process to ensure that quality objectives and targets are set, plans are determined, progress is
tracked, and education is provided. In the best Six Sigma organizations, process owners and
MBBs work very closely and share information daily.
Process Owner (PO) - Process owners are exactly as the name sounds – they are the
responsible individuals for a specific process. For instance, in the legal department there is
usually one person in charge -- maybe the VP of Legal -- that's the process owner. There may be
a chief marketing officer for your business -- that's the process owner for marketing. Depending
on the size of your business and core activities, you may have process owners at lower levels of
your organizational structure. If you are a credit card company with processes around billing,
accounts receivable, audit, billing fraud, etc., you wouldn't just have the process owner be the
chief financial officer, you would want to go much deeper into the organization where the work is
being accomplished and you can make a big difference.
Black Belt (BB) - Black Belts are the heart and soul of the Six Sigma quality initiative. Their main
purpose is to lead quality projects and work full time until they are complete. Black Belts can
typically complete four to six projects per year with savings of approximately $230,000 per project
(see earlier reference). Black Belts also coach Green Belts on their projects, and while coaching
may seem innocuous, it can require a significant amount of time and energy.
Green Belt (GB) - Green Belts are employees trained in Six Sigma who spend a portion of their
time completing projects, but maintain their regular work role and responsibilities. Depending on
their workload, they can spend anywhere from 10% to 50% of their time on their project(s). As
your Six Sigma quality program evolves, employees will begin to include the Six Sigma
methodology in their daily activities and it will no longer become a percentage of their time -- it will
be the way their work is accomplished 100% of the time.
Now we know how some companies have organizationally structured their Six Sigma quality
program. But how do you ensure that everyone's doing their job? How do you keep your
employees motivated when fires are burning all over the corporate landscape?



Six Sigma Organizational Architecture - Rewards
and Recognition
By Charles Waxer
Six Sigma is a quality methodology that can produce significant benefit to businesses and
organizations. Not much text, however, has been written about the structure needed to
successfully implement Six Sigma quality within your business or organization. Page 1 > Six
Sigma Architecture focused on roles and responsibilities of a successful Six Sigma quality
program. This page focuses on the rewards and recognition associated with a successsful Six
Sigma quality program.
Rewards and Recognition
We all know that roles assignment is not enough to start and maintain a successful Six Sigma
quality program. Rewards and recognition must be part of the equation. So how do we reward the
different roles within the organization? Let's start with the Green Belts and work our way back up
the organization.
Green Belts - Depending on the size of the project and the resulting benefits, gift certificates,
cash and stock options are all motivating factors. But don't underestimate the motivating power of
a public congratulations in front of peers -- it is many times even more effective than a monetary
amount. Depending on the progress of your program, you may want to tie their salary action to
the results of the project(s) they completed during the past year.
Black Belts and Master Black Belts - Their salary and bonus structure should be tied to the
number of projects and benefit of those projects to the business bottom line. Metrics including
productivity, loss reduction, improved quality, reduced overhead, etc. should all be factors in
determining the proper payout for performance. For under performing BBs and MBBs, the
performance appraisal meeting should serve as a fulcrum in modifying their behaviors and
actions.
Process Owners - Here's one of the key roles that needs to be defined properly. The Process
Owner's compensation (salary and bonus) must be tied directly to quality efforts within their
organization. It's not enough to allow Quality to 'work with us,' but their metrics and efforts need to
be utilizing all of the quality tools appropriately. Why not make 25% of their bonus tied to meeting
their quality initiative goals and objectives? Then have them report on how they did before you
determine the bonus payout.
Quality Leader - Performance based compensation (salary and bonus). Leadership capabilities
are critical to this position, so not only should the quantitative aspects (savings, projects, training,
etc.) be measured, but so should the qualitative. The difficulty arises in defining and clearly
identifying the required behaviors.
CEO - The buck stops here. If the CEO is fully on board with the Quality initiative, s/he will have
no problem tying the compensation of her/his direct reports to Quality deliverables.
Don't be shy about asking to tie compensation to your Six Sigma Quality initiative. It's the only
way you'll truly have your entire organization focused around the customer and the quality of your
processes and deliverables.
Have a thought about this article? Post in on the Discussion Forum
First Page > Six Sigma Organizational Architecture



Six Sigma Curriculum and Body of Knowledge
By Charles Waxer
iSixSigma receives many questions regarding the Six Sigma methodology and, more specifically,
what each business change agent (Champion, Master Black Belt, Black Belt, Green Belt) should
know in order to be effective. To help meet this need, I have created a reference document
detailing what should be contained in a Six Sigma curriculum. Below is iSixSigma's
recommendation for a body of knowledge for Six Sigma. You may find it useful when selecting a
Six Sigma provider or completing training to ensure you are learning all appropriate topics.
It is the belief of this author and iSixSigma that Master Black Belts and Black Belts should
possess the same detailed knowledge of process improvement and statistical analysis, although
the two roles vary significantly in other ways (see Organizational Architecture). For this reason, all
of the key understanding areas listed under the DMAIC sections for the Master Black Belt and the
Black Belt are identical.
 Champion / Process Owner Curriculum and Body of Knowledge
 Master Black Belt (MBB) Curriculum and Body of Knowledge
 Black Belt (BB) Curriculum and Body of Knowledge
 Green Belt (GB) Curriculum and Body of Knowledge
If you feel that some relevant topic is missing from the curriculum or body of knowledge of any of
the areas listed above, please send an email to iSixSigma.
Additional Resources
Six Sigma Organizational Architecture - Successful Six Sigma Quality programs are built on a
solid organizational foundation. The organizational structure and rewards/recognition system
needs to be clearly identified and communicated to successfully implement Six Sigma Quality.
Master Black Belt and Black Belt - Resources for Six Sigma Master Black Belts and Black
Belts.



Six Sigma Training
By Charles Waxer
Implementing Six Sigma within your organization is similar to implementing any other company-
wide initiative. Determining the content and framework, developing the materials, and rolling it out
to the company is only half of the necessary work. The other half is changing the culture.
Six Sigma Training is one of the most important factors that contributes to and helps modify and
shape an organization's culture. This article will help identify who in your organization is required
to be Six Sigma trained and what type of Six Sigma training they should receive.
Who and What Type of Training?
Senior Management
Senior Management, also known as 'C-Level Management' (CEO, CIO, CFO and peers), are the
individuals that set, communicate and drive the overall business objectives. They are also the
individuals that are required to incorporate Six Sigma objectives into their operational plans.
Examples of objectives might include:
 X% of employees through Six Sigma training by a certain date
 Y% reduction in defects for all customer visible processes by quarter end
 $Z in back-office projects savings by year end
Six Sigma training for Senior Management should include a program overview, business and
financial benefits of implementation, real-world examples of successful deployments, specific
application to business/industry, and the required Six Sigma training and tools to ensure
successful implementation. Depending on Senior Management time availability and their desire to
learn the details, Black Belt training is also recommended.
Functional / Process Managers
Functional and Process Managers are the level of management directly reporting to the Senior
Management. Depending on the size of the organization, they might include functional managers
from areas such as human resources, finance and training, and process managers from areas
such as assembly, production and call center.
These managers are sometimes referred to as 'sponsors' and 'champions' because they are
known to champion the cause within their business organization. These champions translate
Senior Management's strategic directions into tactical objectives and actions with the help of their
Quality Leader and Project Leaders.
Six Sigma training for Functional and Process Managers is more detailed than that provided to
Senior Management. Topics would include the Six Sigma concept, methodology, tools and
requirements to ensure successful implementation within their organization. Depending on
Functional / Process Manager time availability and their desire to learn the details, Black Belt
training is also recommended.
Quality Leaders
Quality Leaders, also known as Quality Managers and Master Black Belts, help Functional and
Process Managers set and lead the Six Sigma vision within their specific areas. They maintain
rolled up budgets, track business cost savings, ensure training goals are met, coach Functional
and Process Managers, Project Leaders and Employees, review projects at milestones, share
best practices, and ensure appropriate use of tools and methodologies.
Six Sigma training for Quality Leaders includes detailed information about the concept,
methodology and tools, as well as detailed statistics training and computer analysis tool use.
Depending on the instructor, the duration is usually between three and four weeks.
Project Leaders
Project Leaders, also known as Black Belts, implement the Six Sigma methodology and tools
within the business. They lead the intra- and inter-function projects, maintain time lines and
budget, determine appropriate tool use, perform analyses, and act as the central point of contact
for specific process improvement projects.
Six Sigma training for Project Leaders includes detailed information about the concept,
methodology and tools. Depending on the instructor, the duration is usually between two and four
weeks, and may include one of more weeks in between sections. Statistics is included in the
agenda, but typically does not include as much detail as that provided to Quality Leaders.
Employees
Employees, also known as Green Belts, may also take Six Sigma training courses developed
specifically for part time Project Leaders. Six Sigma training for Green Belts is similar to Black
Belt training, but shorter in duration because less detail on complex tools and statistics is
provided. Employees are instead told to ask their Black Belt for help in specific areas.
Six Sigma Training Information
iSixSigma's intent over the upcoming weeks is to gather all available training information for your
use -- by training course, geographic location (city, state, country), cost per individual, and much
more. Be sure to sign up for the iSixSigma Insights newsletter to be notified of its availability. Visit
the iSixSigma Six Sigma Training Calendar for the latest information on available training. Visit
the online Six Sigma training section for details about courses that may be taken over the
Internet.
What Is Six Sigma Certification?
By Charles Waxer
Many people have written to me and iSixSigma asking various questions about Six Sigma
certification. How can I get Six Sigma certified? Where can I get Six Sigma certified? Is Six Sigma
certification transferable if I leave a company for another? The list goes on and on. This article will
help answer these questions regarding the ubiquitous and confusing 'Six Sigma certification'
topic. If you find a question missing or would like clarification on a specific topic, please submit it
along with any thoughts you have.
Jump To The Following Answers:
 What is Six Sigma Certification?
 What Is Involved In Six Sigma Certification?
 How Can I Get Six Sigma Certified?
 Why Isn't ASQ The Sole Six Sigma Certification Body As It Is For CQM?
 Should I Get Six Sigma Certified?
 Can I Transfer Six Sigma Certification Between Organizations?
 More Certification Questions and Answers »
What is Six Sigma Certification?
Six Sigma certification is a confirmation of an individual's capabilities with respect to specific
competencies. Just like any other quality certification, it does not indicate that an individual is
capable of unlimited process improvement, just that s/he has completed the necessary
requirements from the company granting the certification.
For instance, millions of people have applied for, tested and been granted a driver's license in the
United States. It certifies that a person has passed the minimum guidelines and requirements for
driving. The individual must pass both a written and hands-on driving test in order to 'certify'. Not
all individuals in the United States, however, have the same proficiency in driving - even though
they may have passed the tests and been granted a driver's license. The same is true for Six
Sigma certification. Certification alone does not summarize the worth of a true quality
professional.



What Is Six Sigma Certification?
By Charles Waxer
Many people have written to me and iSixSigma asking various questions about Six Sigma
certification. How can I get Six Sigma certified? Where can I get Six Sigma certified? Is Six Sigma
certification transferable if I leave a company for another? The list goes on and on. This article will
help answer these questions regarding the ubiquitous and confusing 'Six Sigma certification'
topic. If you find a question missing or would like clarification on a specific topic, please submit it
along with any thoughts you have.
Jump To The Following Answers:
 What is Six Sigma Certification?
 What Is Involved In Six Sigma Certification?
 How Can I Get Six Sigma Certified?
 Why Isn't ASQ The Sole Six Sigma Certification Body As It Is For CQM?
 Should I Get Six Sigma Certified?
 Can I Transfer Six Sigma Certification Between Organizations?
 More Certification Questions and Answers »
What Is Involved In Six Sigma Certification?
As with attaining a driver's license in the United States, Six Sigma certification entails learning the
appropriate subject matter, passing a written proficiency test, and displaying competency in a
hands-on environment. The materials can be purchased from almost any Six Sigma training and
consulting company, but almost always comes bundled with classroom training. Usually you or
your company will purchase a training session, which has different bodies of knowledge and
durations for each Six Sigma level (green belt, black belt, master black belt, sponsor, etc.).
The written proficiency test may be given by the training company or the business hiring the
training company. Typically, companies new to Six Sigma will defer to the training company's
proficiency test. Companies that have been performing in-house training for years (such as
Motorola or GE) have created and administer their own written proficiency tests.
After a quality professional has completed training, s/he must complete one or two quality
projects and display competency in applying the concepts learned in the classroom training. This
is where certification companies diverge, as this part of the certification is the most fuzzy and
undefined. Some organizations require a certification candidate to complete one project if a green
belt or sponsor, and two projects if a black belt or master black belt; others require less or more.
In addition, there is no standard for what passes and what fails to display an individual's
competency.
So, what's the takeaway from certification? Any worthwhile certification involves training, a written
proficiency exam, and a hands-on competency display of the methodology to real world
problems. The specifics around each of these three requirements vary from company to
company. Will it ever become standardized? Probably, but not in the next six to twelve months in
the opinion of this author.




What Is Six Sigma Certification?
By Charles Waxer
Many people have written to me and iSixSigma asking various questions about Six Sigma
certification. How can I get Six Sigma certified? Where can I get Six Sigma certified? Is Six Sigma
certification transferable if I leave a company for another? The list goes on and on. This article will
help answer these questions regarding the ubiquitous and confusing 'Six Sigma certification'
topic. If you find a question missing or would like clarification on a specific topic, please submit it
along with any thoughts you have.
Jump To The Following Answers:
 What is Six Sigma Certification?
 What Is Involved In Six Sigma Certification?
 How Can I Get Six Sigma Certified?
 Why Isn't ASQ The Sole Six Sigma Certification Body As It Is For CQM?
 Should I Get Six Sigma Certified?
 Can I Transfer Six Sigma Certification Between Organizations?
 More Certification Questions and Answers »
How Can I Get Six Sigma Certified?
There is no single body designated to provide Six Sigma certification to the quality profession.
Almost every one of the tens of companies providing Six Sigma training and consulting also
provide certification. Why is this? Because individuals and companies are spending a great deal
of money, sometimes in excess of $30,000 per individual, to become trained, and they feel like
they should have something to show for it. Hence, certification became a popular add-on service
for consulting companies because it allowed them to differentiate between skills levels, as well as
charge additional fees.



The Global Salary Survey for Six Sigma
Professionals
By Matthew LeVeque, iSixSigma Senior Contributing Writer
During the past 10 years Six Sigma has become one of the most widely practiced process
improvement methodologies in both service and manufacturing industries. In an effort to gauge
how this is affecting salaries of quality professionals, iSixSigma has analyzed information in its
own Job Shop database to produce a Six Sigma-specific salary survey.

iSixSigma's 2004 Salary Survey for Six Sigma Professionals, the first of what will become an
annual report, has two unique perspectives. First, with respondents from 68 countries on six
continents, the survey provides a global view. Second, unlike other salary surveys of quality
professionals, this one is focused as specifically as possible on Six Sigma professionals – those
whose salary is tied into performing Six Sigma functions on a daily basis.
The salary survey provides a first look at the average annual salaries worldwide, as well as
breakouts by five regions of the globe. Each of four Six Sigma job categories are explored –
Black Belts (BB), Master Black Belts (MBB), Champions (CH) and Deployment Leaders (DL):

Average Salaries                              BB            MBB             CH              DL
Worldwide                                    $ 70,310       $ 93,209        $ 93,317        $105,852
U.S./Canada                                    78,735        102,943         102,244         115,818
Latin America                                  51,941         64,451
Europe                                         62,280         80,392         107,000         101,800
Continental Asia/Africa                        50,977         63,161          51,000          70,000



                                                               U.S. Salaries Alone
                                                               In addition to the global report,
                                                               the iSixSigma survey provides
                                                               average salaries for the United
                                                               States alone, with breakouts for
                                                               four sections of the country.

Pacific Nations                                54,930         74,800         132,500          90,000

In addition, readers can look at survey details which include average salaries for each of the four
job categories by level of education, years of experience and by industry in each of the five
regions, plus a global total. Click on the appropriate link to see survey details.
Worldwide: Assumptions Are Supported
Details of the worldwide survey report support what most readers would consider obvious
assumptions.
In terms of average salaries, Master Black Belts in general make more than Black Belts and less
than Champions. While Champions are not paid significantly more, the difference confirms the
assumption. Also, as expected, Deployment Leaders are at the top earning level. When reporting
salaries by level of education, the survey shows that more education generally means a higher
salary. Salary increases from one step on the education ladder to the next are sizable – most are
double-digit percentage increases. Average salaries by years of experience also follow the
expected pattern of higher pay for greater experience. Salary improvements also are usually
double-digit percentage increases up the experience steps. (In both education and experience
salaries, an irregular and unexplained bump exists in the alignment of Champion salaries. The
bump also appears in many of the regional reports. Future salary surveys will indicate whether
this is an anomaly in this survey or a factor of importance.)
Not surprisingly, these same more-is-better patterns are generally repeated in many – but not all
– of the regional breakouts for average salaries, level of education and years of experience.
The average salaries by industry show that for Black Belts the top pay is in business/consulting
services, chemicals, construction, insurance and pharmaceutical/biotechnology. For Master Black
Belts the top-paying fields are advertising/marketing, aerospace/defense, diversified and
insurance. For Champions the highest average salaries are in automotive, business/consulting
services and chemicals. Deployment Leaders are best paid in business/consulting services,
construction and financial services.
One interesting conclusion that can be made from this salary survey is that there are still a large
number of industries worldwide that have yet to employ a full spectrum of Six Sigma
professionals. Of the 32 industry categories originally in the survey only 25 percent have
respondents from each role. (Industry categories were grouped into 26 somewhat broader
categories in this report for statistical purposes.) Black Belts and/or Master Black Belts are
prevalent in nearly every industry. But those industries without respondents in one of those two
core job categories – construction, environment, hospitality/travel, machinery/heavy equipment,
plastics/rubber and telecommunications – may have unmet needs for Six Sigma professionals.
United States/Canada: Generally Higher Salaries
The number of respondents from the United States/Canada region – 63.8 percent of the total –
was by far the largest in iSixSigma's 2004 Salary Survey for Six Sigma Professionals. Since
Six Sigma has its roots in the United States, this is not unexpected. Average salaries for Six
Sigma professionals are generally higher in the U.S./Canada region than other regions of the
world. That is true without qualification for Black Belts and Master Black Belts. For Champions,
the top region was the Pacific Nations region.
Salaries by level of education: Increases in average salaries for each step within job categories
are generally greater than in other regions. Champion salaries provide an interesting exception at
the graduate degree level. U.S./Canada, Latin America and Europe are the only regions which
had a significant number of respondents whose formal education ended with a high school
diploma. Thus, the report includes data for that level of education. (In regions with only a few high
school respondents their data is merged with the next higher level of education.)
Salaries by years of experience: As in education, experience is well-rewarded in this region –
better than in the others. Again, the Champion category provides an interesting exception, this
time in the 10 to 15 years level.
Salaries by industry: Top industry salaries for Black Belts are in advertising/marketing,
agriculture, business/consulting services, chemicals and telecommunications. For Master Black
Belts the top-paying industries are computer hardware/software/services, energy/utilities,
food/beverages and insurance. For Champions the highest average salaries are in
business/consulting services and computer hardware/software/services. Deployment Leaders are
best paid in business/consulting services, computer hardware/software/services, diversified and
pharmaceutical/biotechnology.
One surprising data point is the comparatively low average salaries in all job categories for Six
Sigma professionals in manufacturing. Survey respondents in that industry earn less on an
average than any of the other 25 industry categories.
Latin America: Smallest Number of Survey Respondents
Latin America is the region with the smallest number of respondents to this survey. And, in fact,
there was no respondent data from Champions and Deployment Leaders. Mexico, a significant
world leader in Six Sigma practice, has the largest number of survey respondents from this
region.
Salaries by level of education: While increases in average salaries for each step within job
categories holds true in this region, the increases are small in dollars as well as percentage. As
noted, Latin America, along with the U.S./Canada and Europe regions, has a sufficient number of
respondents to allow a breakdown for the high school educational level. (In regions with only a
few high school respondents, their data is merged with the next higher level of education.)
Salaries by years of experience:
Unlike every other region in this       About iSixSigma's Salary Survey
survey, with the exception of the       For Six Sigma Professionals . . .
Pacific Nations region, additional
experience does not seem to             The data for this salary survey was gathered through the
translate into a higher salary.         iSixSigma Job Shop. The global reach of iSixSigma
Salaries within the Black Belts and     produced 4,072 salary survey responses from quality-
Master Black Belt categories show       minded business professionals. To make this a Six Sigma-
no relationship to experience. The      specific survey, responses from professionals other than
Pacific Nations region has the          Black Belts, Master Black Belts, Champions and
second smallest number of               Deployment Leaders were discarded.
respondents and shows a similar
static relationship between             The remaining 2,412 survey respondents were distributed
experience and salaries. This           among the four job categories in the following proportion:
leads to the concern that there         Black Belts, 65 percent; Master Black Belts, 25 percent;
may not be sufficient data to track     Champions, 3 percent; and Deployment Leaders, 7
an experience trend.                    percent. This is the data from which the worldwide report
Salaries by industry: Top industry      and regional breakouts are compiled.
salaries for Black Belts are in
advertising/marketing, agriculture      While acknowledging that any division of the world into
and food/beverages. For Master          regions is artificial, iSixSigma has attempted to create
Black Belts the highest average         regional breakouts which make sense but also allow each
salaries are in                         region a sufficient number of respondents to give the
advertising/marketing, automotive,      survey as much validity as possible. Here are the regions
computer                                with the number and percentage of survey respondents
hardware/software/services, and         from each:
food/beverages.
Europe: Experience Really
Counts                                   U.S./Canada                                         1,539 (63.8%)

The second largest number of             Latin America                                         99 ( 4.1%)
survey respondents is from               Europe                                               427 (11.7%)
Europe. In this region, more than
half are from the United Kingdom,        Continental Asia/Africa                              247 (10.2%)
slightly more than 12 percent from       Pacific Nations*                                     100 ( 4.1%)
Germany and France combined,
and the balance from other
countries. The average salaries of
European Six Sigma professionals
are both below and above global
averages, depending on the
position. For example, the average
earnings for European Black Belts
are $8,030 less than the global
average; yet, Champions in                *Australia, Indonesia, Japan and Pacific Islands
Europe earn $13,683 more than
the global average.                     It should be noted that the survey requested respondents
Salaries by level of education:         to record the location where they reside, not where their
Average salaries for most job           company's corporate office is located. Some consultants
categories start on a par with          and those who telecommute may have listed their
global averages, but end up below       company office location instead of their residence.
average at higher levels of
education. Except for Black Belts,      For comparison purposes all salaries are reported in U.S.
earning a doctorate degree              dollars. Since this is a worldwide salary survey, readers
generally yields the largest            obviously need to consider that the cost of living can differ
increase in salary in this region. As   dramatically from one part of the world to another.
noted, Europe along with the U.S./Canada and Latin America regions has a sufficient number of
respondents to allow a breakdown for the high school educational level. (In regions with only a
few high school respondents, their data is merged with the next higher level of education.)
Salaries by years of experience: The survey suggests Europe puts a premium on experience.
The largest average salaries do not occur until a Six Sigma professional has achieved 3 to 5
years as a Deployment Leader, or 5 to 10 years as a Master Black Belt. Champions see the most
sizable increase when they have 15-plus years of experience. The salary range for Black Belts is
relatively small compared to global figures.
Salaries by industry: Top industry salaries for Black Belts are in agriculture, environment,
healthcare, insurance and plastics/rubber. For Master Black Belts the top-paying industries are
advertising/marketing, apparel, chemicals and diversified. For Champions the highest average
salaries are in aerospace/defense and chemicals. Deployment Leaders are best paid in
business/consulting services, construction, financial services and food/beverages.
Continental Asia/Africa: Lowest Average Salaries
Average salaries in Continental Asia/Africa for all four positions tracked by the survey are the
lowest of any region. Also, role responsibilities of different job categories are not clearly reflected
in average salaries in this region. In many instances, similar levels of salary are earned by Six
Sigma professionals no matter what role they play in implementing the methodology – Black Belt,
Master Black Belt, Champion or Deployment Leader. This region also is dominated by a single
country. More than 68 percent of the respondents from this region live in India. This undoubtedly
is an indication of the growing strength of Six Sigma in India and the nation's leadership in
cultivating the methodology.
Level of education and years of experience do not seem to have a significant effect on average
salaries in this region.
Salaries by industry: The automotive industry is the only business group represented by survey
respondents from all four job categories; however, half of the 26 industry categories have Black
Belt respondents. Top industry salaries for Black Belts are in aerospace/defense, agriculture,
business/consulting services and chemicals. For Master Black Belts the top-paying industries are
advertising/marketing, business/consulting services and manufacturing. For Champions the
highest average salaries are in chemicals. Deployment Leaders are best paid in
business/consulting services, chemicals and computer hardware/software/services.
Real Time Salary
                            Pacific Nations: Near Mid-Point on List of Averages
Survey                    This region has the second smallest number of survey respondents,
                          yet its average salaries are near the mid-point on the list of region
No need to wait until     averages. The Pacific Nations region includes Australia, Indonesia,
next year for an updated Japan and the other island nations in the Pacific Ocean. As a side
salary survey. Anytime    note, this region features the highest average salaries for
you want, you can go      Champions of any region, thanks to a $200,000-per-year Champion
online to the iSixSigma   being one of only two respondents in that job category.
Job Shop. There you       Salaries by level of education: As in the Continental Asia/Africa
can compare your          region, level of education does not seem to have a significant effect
salary to other Six       on average salaries in this region.
Sigma quality             Salaries by years of experience: Experience also seems to have
professionals and filter  little effect on average salaries, until a person reaches the 15-year-
by role, education,       plus level.
experience, location and Salaries by industry: Only seven of the 26 industry categories were
industry. All information represented by respondents from this region. Again, this is an
is privacy protected.     indication that many companies have yet to cash in on Six Sigma
Who uses the Job          opportunities. Industry salaries for each of the four job categories
Shop? This year’s         are fairly well homogenized. Only the average for Deployment
iSixSigma salary survey Leaders in the computer hardware/software/services industry is
was compiled from         head and shoulders above other industries.
information volunteered All data is property of iSixSigma and may not be redistributed or
by thousands of Job       published in any form unless prior written consent is provided by
Shop users in 68          iSixSigma.
different countries and a
wide variety of
industries. Sign up for a
free iSixSigma Job
Shop account today.

				
DOCUMENT INFO