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Vikram Sharma Abhinav Prasoon Amit Uniyal
Introduction to the Case Study
• Case is about Six Sigma which is a management strategy which seeks to improve the quality of process outputs by identifying the errors and removing the defects. • The case explains on how “3M” adopted this strategy as a key lever for the firm to become more competitive. • In the following slides you would be explained on how Six Sigma was introduced at “3M” and how they used the simple approach to put “3M” on fast forward
• Richard G. Paul in 1910.History of “3M” • Founded in 1902 at the Lake Superior Town of Two Harbors. . Thermo Fax copying processor and several new electro-mechanical products. • Due to a rapid growth in Mining and Sandpaper products. Drew (Lab assistant) invented masking tape which was a major innovation for the organization. Minnesota by Five Businessman. • From 1940-1980. 3M entered new ventures introducing the Scotch-Brite cleaning pads. • The 1990’s set a new sales record of over $15 billion. the company moved to St. • Gave out its first dividend at 6% share in 1916.
The question was how would Six Sigma help the firm to become more competitive. . 3M announced W.Year 2001 – Six Sigma being Introduced to 3M • On January 1. Mc Nerney announced the implementation of Six Sigma approach to process and business environment. was elected as the Chairman and CEO of the firm. James Mc Nerney Jr. • Initiated a massive training program for hundreds on Sr. • At the annual shareholders meeting. Executives. 2001. • Many Managers believed that 3M was already a quality company.
4 parts per million. •Six Sigma was originally developed as a set of practices designed to improve manufacturing processes and eliminate defects. • DMAIC is used to improve an existing business process. •Six Sigma has two key methodologies: DMAIC and DMADV or DFSS. •Six Sigma implies a defect of only 3. originally developed by Bill Smith at Motorola in 1986 that today enjoys wide-spread application in many sectors of Industry. • DMADV is used to create new product or process designs. .About Six Sigma: •Six Sigma is a business management strategy. but its application was subsequently extended to many other types of business processes as well.
Determine what the relationships are. A six sigma black belt is assigned to lead a process improvement team. • Improve or optimize the process based upon data analysis. • Measure key aspects of the current process and collect relevant data. .The basic DMAIC methodology consists of the following five steps: • Define process improvement goals that are consistent with customer demands and the enterprise strategy. A senior executive is chosen to act as the “Champion”. and attempt to ensure that all factors have been considered. • Analyze the data to verify cause-and-effect relationships. • Control to ensure that any deviations from target are corrected before they result in defects.
Measure and identify CTQs (characteristics that are Critical To Quality). and risks. Analyze to develop and design alternatives. optimize the design. implement the production process and hand it over to the process owners • • • . product capabilities. Verify the design. create a high-level design and evaluate design capability to select the best design. This phase may require simulations. production process capability. and plan for design verification.The basic methodology of DMADV or DFSS consists of the following five steps: • Define design goals that are consistent with customer demands • and the enterprise strategy. set up pilot runs. Design details.
8 .Why Six-Sigma at 3M 3M was already a quality company with many high quality products in market but still their financial performance was “flat” due to which they felt the need of adopting six sigma.
Six-Sigma at 3M (Implementation) • The 3M approach to six sigma included two different improvement models: 1. For new product development DFSS (Design for Six Sigma) was used. 2. 9 . the five-step DMAIC model. For existing processes.
E-Productivity: Performing commercial activities through electronic media in order to be more efficient. 2. Being more responsive to customers through 3M acceleration.3M Initiatives • 3M moved from multiple quality management systems to single companywide approach : Six Sigma. Six Sigma: pursuing quality improvement under one single program. Following are the few initiatives taken by 3M: 1. productive and render better serviceas support to customers. 10 .
3. especially in critical times. Indirect Cost: Good management of cost is critical for a sound business plan. Supply: Purchasing in more systematic way led to cost reduction for 3M.3M initiatives 4. Due to implementation of six sigma a lot of indirect cost was reduced which led to increased efficiency. 11 .
The Right Projects” + The Right People + The Right Roadmap and Tools + The Right Support = The Right Results .Approaches 3M's simple approach to Six Sigma.
3M's simple approach to Six Sigma .
Skeptics The skeptics point to the following issues in using Six Sigma: We can't afford to improve our processes to 3. Also.4 parts per million defects as implied by Six Sigma. our customers don't need this level of quality. We need a simpler approach to process improvement. . Six Sigma is too complicated and involves too much statistics for our people.
to measure. We can't afford the training costs and the appointment of full time black belts for process improvement. if not impossible. Six Sigma is just the latest quality fad-. . Six Sigma is better suited to manufacturing.it too will pass. Six Sigma doesn't work very well for service processes or transaction-based processes that have intangible outputs and are difficult.
Functional areas to be included under six sigma Information systems required to support 6 sigma Human resource implications for deploying six sigma (Black belts. master black belts.CHALLENGES AT 3M • • • • • • Tracking and reporting of 6 sigma program Costs and risks involved in implementing this strategy Management skills required to implement it.) • Planning for their incentives . champions etc.
Fast Forward • Six sigma changed company’s focus into three main areas. which makes things easier for people working on the same. . namely : Growth. • Data driven of six sigma approaches helped in energizing and motivating them as well.3M. Cost savings and cash generation • It provided single approach on improving the ways of getting things done • Six sigma leverages all information under a unified system. • It bought in new dimensions of problem solving which led to maximum yield in projects.
New Directions •For Shareholders: Strong.3M and Six Sigma: New Dimensions. developing leadership skills •For Customers: A more responsive. faster company with competitive product and services. solid investment •For Employees: Learning new processes. •Expected operating income to improve by $300 million to $450 million. 18 . financially healthy company-a good.
• Helps in determining the true potential. 19 . • It helps in setting goals for the best possible outcome.• Entitlement-A concept of Six Sigma :The absolute best possible outcome that can be achieved with a given process.
• A roadmap to breakthrough performance-a disciplined methodology to drive value creation. and measurement across entire company. One process improvement methodology. CEO. • Provides leadership development throughout all disciplines within the organization. Jr. W. 20 . • One global business language.James McNerney.Summary: Six Sigma at 3M • “Six Sigma is totally changing 3M. • A proactive means of achieving excellence in all business processes. 3M. new product development. 25 June 2005 • First time common approach to problem solving. Many of the things that had driven the success of our company for the past eighty years no longer apply”.
..Thank You. 21 ....
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