What is Six Sigma?


Sigma is a letter in the Greek Alphabet
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What Is Six Sigma?
Degree of variation; Level of performance in terms of defects; Statistical measurement of process capability; Benchmark for comparison; Process improvement methodology; It is a Goal; Strategy for change; A commitment to customers to achieve an acceptable level of performance


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Six Sigma Definitions
• Business Definition  A break through strategy to significantly improve customer satisfaction and shareholder value by reducing variability in every aspect of business. • Technical Definition  A statistical term signifying 3.4 defects per million opportunities.

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000 66.Sigma Defects Per Million Level Opportunities 690.800 Rate of Improvement 2 times 5 times 4 5 6 6.210 230 3.000 1 2 3 308.4 11 times 27 times 68 times 4 .

• Assuming quantitative data. . ”Show me the money” “Show me the data” Practical: • Emphasis on financial result. • Start with the voice of the customer.Six Sigma A scientific and practical method to achieve improvements in a company Scientific: • Structured approach.

Where can Six Sigma be applied? Service Management Purchase Design Administration Six Sigma Methods Production Quality Depart. HRM IT M&S .

„Six Sigma‟ companies  Companies who have successfully adopted „Six Sigma‟ strategies include: .

General Electric • In 1995 GE mandated each employee to work towards achieving 6 sigma • The average process at GE was 3 sigma in 1995 • In 1997 the average reached 3. Jack Welch Chief Executive Officer General Electric .2BUS$ “the most important initiative GE has ever undertaken”.5 sigma • GE’s goal was to reach 6 sigma by 2001 • Investments in 6 sigma training and projects reached 45MUS$ in 1998. profits increased by 1.

Barriers to implementation Barrier #1: Engineers and managers are not interested in mathematical statistics Barrier #2: Statisticians have problems communicating with managers and engineers Barrier #3: Non-statisticians experience “statistical anxiety” which has to be minimized before learning can take place Barrier # 4: Statistical methods need to be matched to management style and organizational culture .

CAMT and Sauer Danfoss will ensure the former occurs .Reality  Six Sigma through the correct application of statistical tools can reap a company enormous rewards that will have a positive effect for years or  Six Sigma can be a dismal failure if not used correctly  ISRU.

finance and services .Six Sigma  The precise definition of Six Sigma is not important. manufacturing. the content of the program is  A disciplined quantitative approach for improvement of defined metrics  Can be applied to all business processes.

Focus of Six Sigma* Accelerating fast breakthrough performance Significant financial results in 4-8 months Ensuring Six Sigma is an extension of the Corporate culture.. Sigma Breakthrough Technologies Inc. Austin. not the program of the month Results first. . TX. then culture change! *Adapted from Zinkgraf (1999).

The Six Sigma metric .

Statistical background Some Key measure Target = m .

3  Target = m .Statistical background „Control‟ limits +/ .

Statistical background Required Tolerance LSL USL +/ .3  Target = m .

3  USL Target = m +/ .Statistical background Tolerance LSL +/ .6  Six-Sigma .

Statistical background Tolerance LSL +/ .3  USL 1350 pp m 1350 pp m Target = m +/ .6  .

6  .Statistical background Tolerance LSL +/ .3  USL 0.001 pp m 1350 pp m 1350 pp m 0.001 pp m Target = m +/ .

Statistical background  Six-Sigma allows for un-foreseen „problems‟ and longer term issues when calculating failure error or re-work rates Allows for a process „shift‟ .

5  USL 0 ppm 3. 4 ppm 66803 ppm 3.Statistical background Tolerance LSL 1. 4 ppm m +/ .6  .

Performance Standards  2 3 4 5 6 Process performance PPM 308537 66807 6210 233 3.9997% Long term yield Current standard World Class .1% 93.38% 99.977% 99.3% 99.4 Defects per million Yield 69.

70 99.75 99.77 99.44 89.966 0 4.0 .32 99.66 0 0 62.02 99.64 97.32 0 0 50.Performance standards First Time Yield in multiple stage process Number of processes 1 10 100 500 1000 2000 2955 3σ 4σ 5σ 6σ 93.9767 99.27 99.99966 50.09 93.2 79.1 53.24 99.9966 0.96 99.379 99.83 0 0.

r.4 < 10% of turnover World class 5 233 10-15% of turnover 4 6210 15-20% of turnover Current standard 3 66807 20-30% of turnover 2 308537 30-40% of turnover Bankruptcy . financials -level Defect rate Costs of poor quality Status of the (ppm) company 6 3.Financial Aspects Benefits of 6 approach w.t.

Six Sigma Process .

Six-Sigma .A “Roadmap” for improvement Define Measure Analyze Improve Select a project Prepare for assimilating information Characterise the current situation Optimize the process Control Assure the improvements DMAIC .

Define Measure Analyze Improve Control .

Deployment (Define) phase  Team Roles  Presentation skills  Project management skills  Group techniques  Quality  Pitfalls to Quality Improvement projects  Project strategies .

Measurement phase  Quality Tools  Risk Assessment  Measurements  Capability & Performance  Measurement Systems Analysis  Quality Function Deployment  FMEA .

Analysis phase  Hypothesis testing  Comparing samples  Confidence Intervals  Multi-Vari analysis  ANOVA (Analysis of Variance)  Regression .

Improvement phase  History of Design of Experiments (DoE)  DoE Pre-planning and Factors  DoE Practical workshop  DoE Analysis  Response Surface Methodology (Optimisation)  Lean Manufacturing .

Design of Experiments What can it do for you? Minimum cost Maximum output .Example .

What does it involve? Brainstorming sessions to identify important factors Conducting a few experimental trials Recognising significant factors which influence a process Setting these factors to get maximum output .

Control phase  Control charts  SPC case studies  EWMA  Poka-Yoke  5S  Reliability testing  Business impact assessment .

Example .reduces variability and keeps the process stable Disturbed process Natural process Natural boundary Temporary upsets Natural boundary .SPC (Statistical Process Control) .

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