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Six Sigma Means 3.4 Defects in 1,000,000 MOTOROLA

Six Sigma is a business concept that answers customers demand for high quality and Defect-free Business process. Six Sigma was born in Motorola and developed by Mikel J. Harry. Motorola won Malcolm Baldridge Quality Award. Six Sigma is carried out as projects and mostly uses DMAIC method

Eg: Godrej -G E Assembly Plant

Defective Components were coming at the rate of 3,00,000 for one Million Parts.
Applying Six Sigma saved Rs 4 Crores Mr. Vijay Krishna, C.E.O, Godrej-G E. Were not talking about intangible savings here. Six Sigma has given us the power to measure and control costs. And that goes straight to our bottom line

PROCESS CAPABILITY
Process capability is simply a measure of how good a metric is performing against established standard(s).

Upper and Lower Standards (Specifications) Spec (Low er) Out of Spec In Spec

Single Standard (Specification) Spe c

Spec (Upp er)

Out of Spec In Spec

Out of Spec

Probab 4 ility

Probab ility

Probabil ity

CONCEPT OF SIX SIGMA

Process Variability 2 Total Amount Cp Outside Limits 0.67 4.56 % (45,500 ppm) 2700 ppm Typical Action to be taken Heavy Process Control, Sorting rework, Etc. Heavy process Control, Inspection Reduced Inspection, Selected use of Control Charts

1.0

4 1.33

64 ppm

USL

LSL

CONCEPT OF SIX SIGMA

Process Total Amount Variability Cp Outside Limits 5 1.67 1 ppm Typical Action to be taken Spot Checking, Selected use of Control Charts Reduced for Control, Uniformity in process inputs

6 2.00

0.01ppm

USL Process LSL 6 Mean

Cp = Design Width / Process Width Cp = USL LSL / UCL - LCL

SIGMA SCALE OF DEFECTS(1.5 shift)

SIGMA DEFECT RATE COST OF POOR (PPM) QUALITY (% Sales)

Competitive Level World Class

3.4

< 10%

5
4 3

233
6,210 66,807

10%-15%
15%-20% 20%-30%

World Class
High Quality Industry Average

2
1
7

3,08,537
6,90,000

30%-40%
> 40%

Industry Average
Non-Competitive

Six Sigma Implementation

Five-phases process
2.Information Gathering 3.Training

1.Establishing Management Commitment

4.Developing Monitoring Systems

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5.Business Process to Be improved

are chosen

6.Conducting Six Sigma Projects Continuous Improvement

Six Sigma - Three Dimensions

Customer Process A Process B Vendor

Define

Measure

Analyze

Improve

Control

Driven by customer needs

Process Map Analysis
LSL US L

Led by Senior Mgmt

Methodology

Organization

Tools

Upper/Lower specification limits

35 30 25 20 15 10 5 0 L K A F B C G R

Regression

100% 80% 60% 40% 20% 0% D

Enabled by quality team.

Process variation

Frequency

Cumulative Frequency

Pareto Chart

DMAIC PROCESS
Define
Measure

DMAIC
Control

Analyze

Improve

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DEFINE
Determine Bench mark Set Baseline Determine Customer requirements

Get Customer Commitment

Map Flow process

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MEASURE
Develop Defect Measurement Develop Data Collection process Collect Data

Create Forms

Compile and Display Data

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ANALYSE
Verify Data Draw Conclusions From Data Test Conclusions Determine Improvement Opportunities

Determine Root Causes

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IMPROVE
Create Improvement Ideas

Create Models
Experiment

Set Goals
Create Problem Statement Create Solution Statement Implement Improvement Methods
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CONTROL
Monitor Improvement Progress

Measure Improvement Statistically

Assess Effectiveness Make Needed Adjustments

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ENIGMA OF SIX SIGMA

+3

+2

+1

Six Sigma

-1

-2

-3

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SIX SIGMA BENCHMARKS

Restaurant Bills Prescription writing

100K

Payroll processing Order write-up

10K
Average company

Journal Vouchers Wire transfer

Air baggage handling

Material lot Rejected

1K 10

Air flight Fatality Rate Best in class

1 17

(0.25ppm)

Table 1: Companies And The Year They Implemented Six Sigma

Company Name
Motorola (NYSE:MOT) Allied Signal (Merged With Honeywell in 1999) GE (NYSE:GE) Honeywell (NYSE:HON) Ford (NYSE:F)
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Year Began Six Sigma

1986

1994

1995 1998 2000

Table 2: Six Sigma Cost And Savings By Company Year Motorola 19862001 Allied Signal 1998 GE 1996 79.2 0.2 0.3 0.2 0.2 15.1 ND 0.5 2 3.3 356.9(e) ND 16 1 4.5 Revenue ($B) Invested ($B) % Revenue Invested Savings ($B) % Revenue Savings

1997
1998

90.8
100.5

0.4
0.5

0.4
0.4

1
1.3

1.1
1.2

1999
19961999 Honeywell 1998 1999

111.6
382.1

0.6
1.6

0.5
0.4

2
4.4 3

1.8
1.2

23.6 23.7

ND ND

0.5 0.6

2.2 2.5

Key: $B = $ Billions, United States (e) = Estimated, Yearly Revenue 1986-1992 Could Not Be Found 19 ND = Not Disclosed Note: Numbers Are Rounded To The Nearest Ten

The Quality Team

Master Black Belt
- Thought Leadership

- Expert on Six Sigma - Mentor Green and Black Belts

Black Belt

Green Belt

- Backbone of Six Sigma Org Black Belt - Mentor Green Belts - Full time resource - Deployed to complex or high risk projects Green Belt
- Part time or full time resource

Green Belt

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- Deployed to less complex projects in areas of functional expertise

Scope of Six Sigma

Manufacturing Service Industries Hospitals Insurance Call Centre

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