Six Sigma

Process Improvement MethodologyTM

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Purpose

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Provide An Overview of Six Sigma Layout the Process Improvement MethodologyTM

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Code of Conduct
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Please listen as an ally… If you have a question at any time, ask! Use name tents Please be prompt in returning from breaks Turn off the mobile/pager system while in training

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Expectations
You will have a better understanding of Six Sigma What are your expectations for this session?

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!!!!!Quality!!!!!
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Conformance to dimensions, fit, form, requirements, use, Customer Satisfaction. Problem solving
• •

Condition of output Changing gaps between good & bad.

Solutions are engineered well with statistical guidance to Engineering. Who created problems in the first place could not be used to solve it

5

Pursuit of Quality

Inspect for Quality Statistical Process Control
(Deming)

Process Modeling
(Taguchi)

Design for Six Sigma
1930 1940 1950 1960 1970 1980 1990 2000

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!!!!!What’s new!!!!!
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Active Leadership Integration with strategy Quality net income Special Matrics Special roles Project Management Facts decide not judgement. Alignmenet of drivers & behaviour System Approach Remuneration linkage with six-sigma initiatives.
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Six Sigma

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Sigma Breakthrough Technologies has a proven track record Methodology that is unique, systematic, proven, simple, lasting

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Objectives * What Is 6 Sigma ?

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Why Are We Doing 6 Sigma ?

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How Are We Deploying 6 Sigma ?

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Objectives * What Is 6 Sigma ?

*

Why Are We Doing 6 Sigma ?

*

How Are We Deploying 6 Sigma ?

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What is Six Sigma?
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An approach to sustainable breakthrough improvement that:
− − − − −

Fosters a common language and cross-functional cooperation within and between divisions Strengthens our productivity efforts Develops our process improvement core competency Uses statistical tools for significant variability reduction Helps > Develop expert personnel and future leaders > Increase capacity with minimal capital > Meet productivity goals > Improve customer service

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Six Sigma Focus
Improving performance by flawless execution Achieving rapid breakthrough improvement Applying advanced breakthrough tools that work Making a positive and deep cultural change

Getting Real Financial Results

Passion + Execution = Fast and Lasting Results
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Overall Perspective
Process Capabilities Safety

Technology Capabilities Customer Requirements Materials Capabilities Robust Designs Predictable Flexible Factories

Rolled Throughput Yield Customer Satisfaction

COPQ, 4 Wall Cost Capacity Productivity

Organization Capabilities

Materials Mangmnt & Inventory

13

Six Sigma Systems
Materials Management Six Sigma Data Systems Reliability Centered Maint.

New Product Development

Six Sigma Leadership Systems

Process Operation and Control

Measurement Control

Customer Satisfaction Assessment

Problem Solving

Human Resource Involvement

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What is Six Sigma?
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Simple: Simple
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Eliminate variation and defects Eliminate the opportunity for variation and defects Vision Metric (Standard of measurement) Benchmark Philosophy Method Tool for: > Customer focus > Breakthrough improvement > Continuous improvement > People Involvement Aggressive Goals
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Complex
− − − − − −

A Measurement Sigma PPM

2 3 4 5 6

308,537 66,807 6,210 233 3.4

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Another Look . . .

σ
2 3 4 5 6
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% Non-Defective

69.1% 93.32% 99.379% 99.9767% 99.99966%

Practical Meaning
99% Good Postal System 20,000 Lost Articles Of Mail / Hr 7 Lost Articles / Hr 99.99966% Good

Airline System Two Short/Long Landings / Day 1 Short / Long Per 5 Years

Medical Profession 200,000 Wrong Drug Prescriptions / Year 68 Wrong Drug Prescriptions

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What Does 6 Sigma Mean In Your Daily Life?

PPM
Prescription Writing Tax Advice Restaurant Bills 1,000,000 Payroll Processing
100,000 10,000 1,000 100 10

Baggage Handling Best in Class Airline Safety Rate
1 2 3 4 5 6 7

1

Sigma Level
19

Business Metrics
USA Today Medical Article September 22, 1997

Number of antibiotic prescriptions issued in 1996: 282,631,000
JAMA reported that 21% of all antibiotic prescriptions written were to treat colds, bronchitis, and respiratory infections...

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Business Metrics
USA Today Medical Article September 22, 1997

Number of antibiotics prescriptions issued in 1996: 282,631,000
JAMA reported that 21% of all antibiotic prescriptions written were to treat colds, bronchitis, and respiratory infections... even though more than 90% of such infections are caused by viruses, which are immune to antibiotics. 53,000,000 defective prescriptions = 2.4 σ

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Business Metrics Tranquilizers / Anti-Anxiety Medications: 76,370,000 Sleeping Pills / Sedatives: 23,681,000 Anti-Obesity Drugs: 23,596,000

Sources: IMS America, Plymouth Meeting, PA.

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Business Metrics Instructor’s Note: Despite being less than 3 sigma, we are “happy” to report Doctors are operating with very profitable returns. This only proves . . . You don’t have to be 6 Sigma to make money.

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Reality of Escaping Defects
Escaping Defects Escaping Defects

Total Defects/Unit No matter how good your inspection and test processes are, the more defects you create, the more defects escape to the customer
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Premise for Six Sigma Methods

Sources of variation can be
− − −

Identified Quantified and prioritized Eliminated by control or prevention

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3 Sigma Process
Lowe r Spe c Upper Spec

σ

σ

σ

σ

σ

σ

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6 Sigma Process
Lower Spec Upper Spec

σ σ

σ

σ σ

σ

σ σ

σ

σ

σ σ

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Dissecting Process Capability
Inadequate Measurement Capability Inadequate Process Capability Supplier Variation Inadequate Design Margin

LSL

USL

Defects

Process Capability
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Dissecting Process Capability
1000 100 80 60 40 20 0

500

ht.

eig

gC

ub

LSL

USL

Process Capability
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Wr on

De for m

Ov er W

Air B

atio

Defect

b le

olo r

n

0

Percent

Count

Business Impacts of Variability
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Prevention Costs
− − − − − −

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Internal Failure
− − − − − − −

Education and training Quality planning Product design qualification tests Supplier qualification Customer interface Controlling processes
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Scrap Supplier caused losses Rework Retest / Re-inspection Unplanned downtime Trouble shooting Engineering change notices

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Appraisal Costs
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Incoming inspection Maintenance and calibration of equipment Setup inspection and tests Field testing Process audits

External Failures
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Processing customer inquiries Maintaining customer field service Retro fit costs Incurring penalties/claims Product warranty Lost sales

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Exercise
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Go through the list on the previous slide and indicate which costs are EASILY accessed through your current finance systems. Count the selected elements

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Sigma Level
6

Cost of Failure : of Sales

20-25%

5 4

3

2
5% 10% 15% 20% 25% 30%

Cost of Failure (% of Sales)

What’s Your Cost Reduction Opportunity?
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Objectives * What Is 6 Sigma ?

*

Why Are We Doing 6 Sigma ?

*

How Are We Deploying 6 Sigma ?

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Six Sigma
INITIATIVE
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METHODS & TOOLS
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Improvement Breakthrough Focused Approach Right Projects Right People Project Reviews Sustain the Gains Results ($$)

Process Thinking Process Variation Facts, Figures, Data DMAIC 8 Key Tools Statistical Tools Minitab Critical Few Variables

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Process Excellence: The Right Metrics
Defects per 1000
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Scrap
0.21 0.20 0.19

COPQ
0 5 10

RTY

65

0.18 0.17 0.16 0.15

55

0.14 0 5 10

Month

Month

Rate
Units per Day

Baseline Goal Actual

400

350 0 5 10

Month

How is this process doing?
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Actual Metrics Example

Scrap

Downtime

Defects/Unit
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Using Pareto’s to Select Projects
Pareto Chart for Cause
1800 1600 1400 1200 1000 800 600 400 200 0 0
s ces Pro cal hni Tec bly em Ass rs the O

100 80 60 40 20

Defect
C ount Percent C % um

1328 77.0 77.0

198 11.5 88.5

164 9.5 98.0

34 2.0 100.0

Process Related Scrap is the Highest Knife Assembly and Inner Gasket are the two major process scrap drivers Two Potential Projects: - Knife Assembly - Inner Gasket
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Major Part Failure due to Process
600 500 100 80 60 40 20 0
i Kn ly mb sse fe A et ask er G Inn m t top II m 00m TS ese ld S 5m ck 0x1 hi e g, R ing -50 pco ty S prin ous fe fe H S Sto Kni Sa

Count

400 300 200 100 0

Defect
C ount Percent C % um

148 24.0 24.0

128 20.8 44.8

75 12.2 57.0

74 12.0 69.0

72 11.7 80.7

69 11.2 91.9

50 8.1 100.0

Percent

Percent

Count

Six Sigma Everywhere
SERVICE DESIGN

ADMIN. Six Sigma Methods

PURCH.

QA

MFG.

MAINT.
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The Process Improvement MethodologyTM
Process Definition

Process Measurement

Process Analysis

Process Improvement

Process Control
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The Process Improvement MethodologyTM
Phase 0: Define
•Scope

and Boundary
•Define •Team

Phase I: Process Measurement • Map process and Identify Inputs and Outputs • Cause and Effects Matrix Establish Measurement System Capability Establish Process Capability Baseline Phase II: Process Analysis • Complete FMEA • Perform Multi-vari Analysis • Identity Potential Critical Inputs • Develop Plan for Next Phase

Defects
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Charter and Sponsor
•Estimated

$ Impact approval

•Leadership

Phase III: Process Improvement • Verify Critical Inputs • Optimize Critical Inputs Phase IV: Process Control • Implement Control Plan • Verify Long Term Capability • Continuously Improve Process
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