Six Sigma: Panacea for the Biopharmaceutical

Industry?
Table of Contents
Title Page

Abstract 2

Introduction 3

What is Six Sigma? 3

Focus on Causes of Variation 3

Primary Goal of Six Sigma: Process Improvement 4

Exposing the “Hidden Factory” 4

Is Six Sigma Strictly for Manufacturing? 5

What is the key to Six Sigma? 5

How does a Business Benefit from Six Sigma? 9

Belts in Six Sigma 10

Is Six Sigma embraced by the Biopharmaceutical Industry? 11

How does a company implement Six Sigma? 12

Managing Six Sigma projects 15

Sustaining Six Sigma 15

Six Sigma: Panacea for the Biopharmaceutical Industry? 16

References 18
Abstract

Six Sigma is a process solving methodology based on statistics aimed at reducing

variation in a process to 3.4 defects per million defect opportunities. It has the
ability to detect critical underlining variables that lead to lost revenue, failure to
meet customer expectations and finally exposing a company’s “Hidden Factory”.
To convert practical problem into a statistical problem, generate a statistical
solution and then convert that back into a practical solution, Six Sigma uses the
DMAIC process. DMAIC is an acronym for Define, Measure, Analyze, Improve, and
Control. DMAIC defines projects goals and deliverables to meet customer’s
expectations, obtains a baseline of the performance of the process, determines the
root cause (s) of the defects, develops steps for the elimination or reduction of
defects and instils control the performance of the process.
The benefits of Six Sigma include clear value proposition and return on investment,
top commitment and accountability, customer focus, business metrics, process
orientation, project focus, and a complete culture change that evolves in systematic
approach to problem solving and a pro-active attitude among employees.
Biopharmaceutical companies today face increasing demands to demonstrate
continuous revenue growth, a growing demand from the public to control the rising
cost of therapeutics and increasing demand from regulatory agencies such as
United States Food and Drug Administration to prove they (the company)
understand their manufacturing processes. To meet these challenges companies
who adopt Six Sigma programs are able to improve their profit margins and well as
developing an intimate understanding of their process.
The true challenge of a Biopharmaceutical company is deciding whether or not to
challenge the status quo and expose their “Hidden Factory” by implementing a Six
Sigma program. This requires a long-term commitment from senior management
and the ability to assess their current capability and needs. After implementing a Six
Sigma program a company is able to sustain the program by ensuring the program
simple to use, allowing employees to be innovative, provide motivation, and
ensuring that the process is speedy.
As to the question “Six Sigma: Panacea for the Biopharmaceutical Industry?” Six
Sigmadoes not promise to be the Panacea for all the company’s problems. It is
however, a powerful tool that directly impacts on process improvements and a
potentially provides huge financial return on a business bottom line.

Introduction
Before we can answer the question “Is Six Sigma the panacea for the
Biopharmaceutical Industry?” we must first answer the questions “What is Six
Sigma?”, “What are the benefits of Six Sigma?” and “How does it relate to the
Biopharmaceutical Industry?. There are several other questions that could also be
asked abut the subject is so vast that a person could literally write a book. This
paper is designed only to open a dialogue on Six Sigma and whether or not the
Biopharmaceutical Industry should embrace it.

What is Six Sigma?

First we should discuss what Six Sigma is not. It is not a quality management
system, such as ISO-9001, or a quality certification system. Rather the best
definition I have found to date was from a paper entitled “Introduction to Six Sigma”
published by Mekong Capital Ltd.1
Six Sigma is a statistically-based process improvement methodology that aims to
reduce defects to a rate of 3.4 defects per million defect opportunities by identifying
and eliminating causes of variation in business processes. In defining defects, Six
Sigma focuses on developing a very clear understanding of customer requirements
and is therefore very customer focused.
At its core, it is a methodology used to minimize mistakes and maximize value by
identifying underlying variation of a process and eliminating them. Or at the very
least minimize them.

Focus on Causes of Variation

One of the key strengths of Six Sigma is that it is a process improvement
methodology that is based on statistics. For example in a manufacturer setting
there are subject matter experts (SME) who’s functionsinclude addressing
manufacturing issues. Quite often their most common issue is defective products,
how to minimize these and still meet deadlines and customer expectations. Since
production is always seemingly under pressure to meet deadlines the SME is forced
to initiate a fix or series of fixes, that deal with reoccurring issues. The resulting
pressure usually forces the SME to make decisions based on limited information or
gut feelings. The end result is a series of band aid solutions to reoccurring variances
in production that have never been addressed properly and continue to periodically
produce defective products.
To ensure that decisions are made properly to deal with underlying variance Six
Sigma uses statistics to justify changes. From the Six Sigma view, a process is
normally represented in terms of Y=f(X’s), in which the Outputs (Y) are determined
by some Input variables (X’s). Initially we ask “What are the possible causes (X’s)
that may influence the outcome Y?”. Once we believe we have a list of potential X’s
we start collecting and analyzing data using Six Sigma testing tools. When able to
isolate which X(s) have the greatest impact on the output we initiate controls. The
benefits become immediately apparent:
We gain greater knowledge about the process so we can now begin to predict
outcomes based on critical inputs.
The focus then shifts towards identifying and controlling the causes rather than
checking the outcomes. Otherwise, we have to focus our effort on Non Value-Added
Activities such as inspection, tests and rework

Primary Goal of Six Sigma: Process Improvement

Once again we quickly see that one of Six Sigma primary goals is process
improvement. It looks at improving underlying variation instead of short term fixes
to problems.
A couple of examples from “Introduction to Six Sigma” published by Mekong Capital
Ltd.1 best illustrate this.
For example, if a wood product manufacturer in Vietnam is experiencing slow cycle
time at the semi finishing assembly quality checking station because they are
getting defective parts from sanding and grinding workshops and have to rework
them:
• Typical Solution: Rebalance the line by allocating more workers to do checking and
reprocessing.
• Six Sigma Solution: Investigate and control key inputs to prevent defects from
occurring in the first place. This may include unclear machine calibration
procedures, unclear sanding-grinding quality working instructions, insufficient
supervision skills of team leaders, lack of wood quality checking process at the
cutting workshop, etc.
In another example, if a plastics company is producing products that don’t
consistently meet the customers’ specifications on the color of the product:
• Typical Solution: Adjust the color mixing formulas in use by using a trial-and-error
effort.
• Six Sigma Solution: Determine mixing process inputs which result in incorrect
colors in finished products and then control those. These inputs might include raw
material supplier, clarity of the formula instructions, system for generating and
testing the mixing formulas, calibration of mixing equipment, ability of operators to
follow instructions, etc.

As you can see from these examples to improve results the company must start
asking questions that identify variations and not create temporary solutions that
amount to non value added activities. When it is time to address these questions a
new measurement system (metrics) must be developed to collect data and to
analyze statistically. These statistical results then raise new questions about the
sources of quality problems relating to its products, services, and processes. The
cycle of process improvement continues.

Exposing the “Hidden Factory”

When studying variation in the name of process improvement you are exposing the
“Hidden Factory”. You are uncovering the rework and cover ups, the hours and days
of wasted time in a company of people who constantly correct mistakes. Every time
a corrective action is taken or a machine is rerun, or a warranty claim is processes,
you are incurring unnecessary rework. When you accept these events as “that just
the way it is”, you have mentally hidden all these activities from your improvement
potential.
The Hidden Factory is one runs in the back ground of every organization. It is the
factory that fixes problems, corrects mistakes and otherwise wastes both time and
money a company’s two most precious commodities. Six Sigma exposes the Hidden
Factory and returns time and money back to the company.

Is Six Sigma Strictly for Manufacturing?

When a researching Six Sigma you will mostly find references for manufacturing.
But in a larger sense Six Sigma focuses on improving processes and it can be
applied to any aspect of a business such as:
Improve on-time-delivery;
Reduce cycle time for hiring and training new employees;
Improve sales forecasting ability;
Reduce quality or delivery problems with suppliers;
Improve logistics;
Improve quality of customer service; etc.
Six Sigma is a versatile tool that can be used to improve any process within an
organization while developing best practices.

What is the key to Six Sigma?

Six Sigma strengthis its ability to turn a practical problem into a statistical problem,
generate a statistical solution and then convert that back into a practical solution.
How is this accomplished a person may ask. By using what is called DMAIC process.
DMAIC is an acronym for Define, Measure, Analyze, Improve, and Control. Once
again the best description that I have found to date was from a paper entitled
“Introduction to Six Sigma” published by Mekong Capital Ltd.1

Define (D)
The purpose of the Define phase is to clearly identify the problem, the requirements
of the project and the objectives of the project. The objectives of the project should
focus on critical issues which are aligned with the company’s business strategy and
the customer’s requirements. The Define phase includes:
• Define customer requirements as they relate to this project. Explicit customer
requirements are called Critical-to-Quality (CTQ) characteristics;
• Develop defect definitions as precisely as possible;
• Perform a baseline study (a general measure of the level of performance
before the improvement project commences);
• Create a team charter and Champion;
• Estimate the financial impact of the problem; and
• Obtain senior management approval of the project

Key questions:
What matters to the customers?
What Defect are we trying to reduce?
By how much?
By when?
What is the current Cost of defects?
Who will be in the project team?
Who will support us to implement this project?

The most applicable tools at this phase are the following:

Project Charter - this document is intended to clearly describe problems, defect
definitions, team information and deliverables for a proposed project and to obtain
agreement from key stakeholders.
Trend Chart - to see (visually) the trend of defect occurrence over a period of time.
Pareto Chart - to see (visually) how critical each input is in contributing negatively or
positively to total output or defects.
Process Flow Chart - to understand how the current process functions and the flow
of steps in current process.

Measure (M)
The purpose of the Measure phase is to fully understand the current performance by
identifying how to best measure current performance and to start measuring it. The
measurements used should be useful and relevant to identifying and measuring the
source of variation. This phase includes:
identify the specific performance requirements of relevant Critical-to-Quality (CTQ)
characteristics;
map relevant processes with identified Inputs and Outputs so that at each process
step, the relevant Outputs and all the potential Inputs (X) that might impact each
Output are connected to each other;
generate list of potential measurements
analyze measurement system capability and establish process capability baseline;
identify where errors in measurements can occur;
start measuring the inputs, processes and outputs and collecting the data;
validate that the problem exists based on the measurements;
refine the problem or objective (from the Analysis phase)
Key questions:
What is the Process? How does it function?
Which Outputs affect CTQ’s most?
Which Inputs affect Outputs (CTQ’s) most?
Is our ability to measure/detect sufficient?
How is our current process performing?
What is the best that the process was designed to do?

The most applicable tools at this phase include the following:

Fishbone Diagram – to demonstrate the relationships between inputs and outputs
Process Mapping - to understand the current processes and enable the team to
define the hidden causes of waste.
Cause & Effect Matrix - to quantify how significant each input is for causing variation
of outputs.
preliminary Failure Mode & Effect Analysis (FMEA) - using this in the Measure phase
helps to identify and implement obvious fixes in order to reduce defects and save
costs as soon as possible.
Gauge Repeatability & Reproducibility (GR&R) - used to analyze the variation of
components of measurement systems so minimize any unreliability in the
measurement systems.

Analyze (A)

In the Analyze phase, the measurements collected in the Measure phase are
analyzed so that hypotheses about the root causes of variations in the
measurements can be generated and the hypothesis subsequently validated. It is at
this stage that practical business problems are turned into statistical problems and
analyzed as statistical problems. This includes:
generate hypotheses about possible root causes of variation and potential critical
Inputs (X’s);
identify the vital few root causes and critical inputs that have the most significant
impact; and
validate these hypotheses by performing Multivariate analysis.
Key questions:
Which Inputs actually affect our CTQ’s most (based on actual data)?
By how much?
Do combinations of variables affect outputs?
If an input is changed, does the output really change in the desired way?
How many observations are required to draw conclusions?
What is the level of confidence?

The Analyze phase offers specific statistical methods and tools to isolate the key
factors that are critical for a comprehensive understanding of the causes of defects:
Five Why’s - use this tool to understand the root causes of defects in a proce