1.introduction SFD

INTRODUCTION TO SIX SIGMA
Sixsigma-introduction/bnj/AVBG
What is Six Sigma?
WHAT IS SIX SIGMA?

Six Sigma is a philosophy; one of making fewer and fewer mistakes in everything we do - from the way we manufacture products to the way we fill out a purchase order. As we discover and eliminate harmful sources of variation, our process capability improves and the defects (mistakes) go away.
WHAT IS DEFECT?
Business Organization INPUTS 1 2 3 4 Products & Services CUSTOMERS 5 Business Results: Revenue, Profit, Cash Flow, Shareholders
Process Steps
Payment
WHAT IS DEFECT?
Failure to meet the Standard of Performance. Failure to challenge the Standard of Performance.
Output of process in Time Sequence
Output of processes in Time sequence
WHAT IS DEFECT?
Big Ys:
Revenue (Y1) Profit (Y2)
Cash Flow (Y3)
WHAT IS DEFECT?
Big Y vs Small Ys:

Revenue (Y 1)
Existing Products New Products
(Y1.1)
Existing Customers New Customers
(Y1.2)
Existing Customers New Customers
(Y 1.1.1)
(Y 1.1.2)
(Y 1.2.1)
(Y 1.2.2)
WHAT IS DEFECT?
Big Y vs Small Ys:

Profit (Y 2)
Cost per Unit Realisation per Unit (Y 2.2) Existing Customers New Customers
(Y 2.1)
Fixed Costs Variable Costs
(Y 2.1.1)
(Y 2.1.2)
(Y 2.2.1)
(Y 2.2.2)
WHAT IS DEFECT?
Big Yvs Small Ys:

Cash Flow (Y 3)
Inventory Receivable Payables
(Y 3.1)
Stores WIP
(Y 3.2)
FGI
(Y 3.3)
(Y 3.1.1)
(Y 3.1.2)
(Y 3.1.3)
Chart for OUTPUT/Hr.

400 1 11 1 1 1 1 1 11 1 11 1 1111 11 1 1 1 11 11 1 11 11 111 1 1 1 11 11 1 1
Individual Value
1 350
11
1 1 1
1 UCL=357.7 Mean=340.4 LCL=323.2
300
1 1 1 1 11 11 1 11 11 1 1 111 111 11 1 1 11 1 1 1 1 11 11 1 11 1 1 11 11 1 11 1 1 1 1 0 100 200
1 1
1 1 1 1 1
300
400
500
Observation Number
WHAT IS SIX SIGMA?

Six Sigma is a Statistical Measurement Sigma Rating of a Process is measure of Goodness of a process w.r.t. its ability to meet the Standard of Performance. Higher is the Sigma Level of a process, better is its ability to meet the Standard of Performance and hence fewer and fewer defects .
SIGMA RATING AND LEVEL OF DEFECT Sigma Rating

2 3 4 5 6
1
Defect(ppm)
308,537 66,807 6,210 233 3.4
690,000
Yield(%)
30.9
69.2 93.2 99.4 99.98 99.9997
ppm: Parts per million
WHAT IS SIX SIGMA?

Six Sigma is a statistical measurement The Sigma Rating allows us: To draw comparisons between similar or dissimilar products, services and processes. To see how far ahead or behind we are. To set the target for Process improvement To gauge our pace in the race for total customer satisfaction.
99.73% IS NOT ENOUGH ?

Unsafe drinking water about two hours each month No Telephone/ Television transmission for about 27 minutes each week Five short or long landings at a major international airport each day Nearly 1350 incorrect surgical operations per week
Three Sigma versus Six Sigma

Three Sigma would be equivalent to one misspelled word per 15 pages of text. Six Sigma would be equivalent to one misspelled over 300,000 pages, quite a difference indeed.
SHOULD ALL PROCESSES BE AT SIX SIGMA?

The airline fatality rate is about 6.5 sigma, but airline baggage handling is about 4 sigma
WHAT IS SIX SIGMA?

Six Sigma as a Business Strategy
Sigma Rating
Costs Customer Satisfaction
Customer Value
Shareholder Value
Basic Tenets of Six Sigma

Customer Orientation
Process Orientation
Speak with facts
NO COMPANY MAKES MONEY INSIDE THE ORGANISATION

EVERYTHING DONE INSIDE THE COMPANY IS COST ONLY WHEN THE COMPANY GOES OUTSIDE IT HAS AN OPPOURTUNITY TO MAKE MONEY
SO, WHAT IS THE REAL PURPOSE OF BUSINESS ?
THE REAL PURPOSE OF BUSINESS IS:
TO FIND CUSTOMERS
SUCCESS IN FINDING THEM
AND SATISFYING THEM

IS MEASURED BY THE PROFITS
WE MAKE
The best six sigma project begin not inside the business but outside it, focused on answering the question - how can we make the customer more competitive? What is critical to the customers success?.. One thing we have discovered with certainty is that anything we do that makes the customer more successful inevitably results in a financial return to us. Jack Welch
Customer Orientation Every Organization is like a Relay Race MARKETING C U S T O M E R DESPATCH

ENGINEERING
PROCUREMENT
MANUFACTURING
Focusing on the Inside will hurt ...
Process orientation
ENVIRONMENTAL INFLUENCES (Government, Economy, Culture)
Business Organization
Capital Market
Acquire Order
Execute Order
Deliver Order
Labor Market
Support Processes:
Leadership HR Finance, etc. COMPETITIORS
Suppliers
C U S T O M E R S
Process orientation
80%
100%
Wont go the Distance
World Class
80%
Contenders
60%
Punch Bag
Promising
0%
60%
100%
Enabler
Process orientation
Functional Silos
QCD QCD QCD QCD
Marketing Engineering Production Dispatch

Process orientation
Functional Silos
QCD QCD QCD QCD
Customer
Marketing Engineering Production Dispatch

Process orientation
FUNCTIONAL vs PROCESS TARGET
INDENTOR
PURCHASE
PROCUREMENT PROCESS
Right Quality Quantity Price Time
STORES
/ USER
Process orientation
Process Measures
Marketing Engineering Procurement Manufacturing Sales
Customer
M3
M2
M3
M2
M1-E= EXT/CR MEASURES M1-I = INT/BUSINESS MEASURES M2 = SUB-PROCESS MEASURES M3 = KEY PROCESS STEP MEASURES
M1-I M1-E Customer
M2
Speak with Facts
If we cant express something in numbers, we dont know much about it. If we dont know much about it, we cant control it If we cant control it, we are at the mercy of chance.
Speak with Facts
IN GOD WE BELIEVE, FOR EVERYTHING ELSE

BRING DATA
Speak with Facts
DATA COLLECTION:
What?
How?
How much? Depends on OBJECTIVE of Data?
Speak with Facts
DATA COLLECTION: OBJECTIVE?
Know current Status
Investigate / Experiment
Control for future
What is Six Sigma?

Six Sigma is a comprehensive system of
achieving , sustaining and maximizing Business success
driven by
Close understanding and satisfaction of customer needs Diligent attention to improving, managing and optimizing business processes, Disciplined use of facts, data and statistical analysis
What is Six Sigma?

Proven benefits of Six Sigma system are diverse,
Including:
Cost reduction
Productivity improvement Market share growth Customer retention Cycle -time reduction Genius of the And
Defect reduction
Culture change, etc.
WHAT DID THEY ACHIEVE FROM SIX SIGMA?
Global Acceptability
The world over, organizations seeking better ways of improving their profitability have adopted Six Sigma because of its ability in giving quick tangible results. These organizations include Motorola,General Electric, Allied signal, Honda, Sony, Canon, Polaroid, Texas Instruments and many more fortune 500 companies across the globe.
WHAT MADE SIX SIGMA SUCCESSFUL AT GE

Operating margin, a critical measure of business efficiency and profitability, hovered around the 10% level at GE for decades. With Six Sigma embedding itself deeper into Company operations, GE in 1997 went through the impossible 15% level approaching 16% and we are optimistic about the upside. The meeting stories are anecdotal; big companies can make great presentations and impressive charts. But the cumulative impact on the Companys numbers is not anecdotal, nor a product of charts. It is the product of 276,000 people executing ... and delivering the results of Six Sigma to our bottom line.
Quotes from GE Annual Report 1997
Six Sigma Costs and Savings at GE

Year Revenue ($B) Invested ($B) % Revenue Invested Savings ($B) % Revenue Savings
1996
79.2
0.2
0.3
0.2
0.2
1997
90.8
0.4
0.4
1.1
1998
100.5
0.5
0.4
1.3
1.2
1999
111.6
0.6
0.5
1.8
Allied Signal Allied Signal, which was on the verge of bankruptcy was made profitable by CEO Larry Bossidy through Six Sigma. The company implemented Six Sigma program in 1994. The cumulative impact on the savings in the direct costs during this period (till 1999) was more than US$ 2 billion
Asea Brown Boveri
ABB, after application of Six Sigma has reduced

equipment error by 83%. The company also made drastic improvements in material handling resulting in an annual estimated cost savings of US $775000.
Johnson & Johnson Reported in its respective annual reports that Six Sigma saved $200 million in 1999, $350 million in 2000, and $500 million in 2002. Ford Motor Company
On its website reported that its customer driven 6-sigma initiative contributed more than $52 million to the bottom line in 2000, its inaugural year , with the expectation of delivering another $200 million by the time the 2002 annual report was published.
Honeywell
Honeywell states on its website that Six Sigma projects have saved $500 Million in 1998, $500 Million in 1999 and $700 Million in 2000.
SIX SIGMA IMPLEMENTATION
PROJECT BY PROJECT APPROACH

A PROJECT IS A PROBLEM CHOSEN FOR SOLUTION. ALL IMPROVEMENT IS MADE PROJECT BY PROJECT AND IN NO OTHER WAY.
WHATEVER IS NOT A PROJECT WILL NOT GET IMPROVED.

JM JURAN
METHODOLOGY
Management Team Buy-in Creating Organization for Six Sigma Identify Six Sigma Projects Carryout Six Sigma Projects
Training People on Six Sigma
Integration with Business Planning Process Institutionalization

ORGANIZATION FOR SIX SIGMA
Management Team
The CEO should be the main driver of the Six Sigma program. Under him departmental / functional heads have to take charge in implementing the program. They are called Six Sigma Champions The Champions must have knowledge on applications and interpretation of statistical tools.
Six Sigma Black Belt works with:
The resolve to attain greater heights
Six Sigma Black belts believe that
Standards exist to be superseded

SIX SIGMA ORGANIZATION
Responsibilities of Management Team
Create vision for Six Sigma. Define road map to implement Select high impact projects. Allocate resources Reward people
SIX SIGMA ORGANIZATION
Six Sigma project Teams Owned by Champions and led by Black Belts
Responsibilities of CHAMPION as Sponsor of Six Sigma project: Ensuring that resources are available for training and projects Participating in project review Participating in Project selection and scoping Providing Strategic direction to the project team Staying informed about the teams progress
Helping the Black Belt overcome road-blocks

Keeping the team focused on the desired result Redirecting the teams activities, if unanticipated events occur Keeping the Management Team informed Being accountable for the results.
CHARACTERISTICS OF SIX SIGMA BLACK BELT

Understands the Big Picture of the business. Understands clearly where Cost is incurred and where Value is added. An expert in application of process improvement tools. Capable of consulting, mentoring and coaching. Drives change by challenging conventional wisdom.
ROLES OF A SIX SIGMA BLACK BELT

Mentoring: Cultivate a network of local Six Sigma individuals at the local organization or site. Teaching: Provide formal training of local personnel in new strategies and tools Coaching: Provide a one-on-one support to local personnel Transferring: Pass on new strategies and tools in the form of training, workshops, case studies, local symposia, etc. Discovering:Finding application opportunities for Six Sigma strategies and tools, both internal and external (e.g., suppliers and customers) Identifying: Surfacing business opportunities through partnerships with other organizations Influencing: Selling the organization on the use of Six Sigma strategies and tools
Master Black Belts - Responsibilities

The Master Black Belts should take the main responsibility of implementing Six Sigma program. They must assist the organization in identifying Six Sigma projects and also develop and train Black Belts under them.
TRAINING PEOPLE FOR SIX SIGMA
WHAT MADE SIX SIGMA SUCCESSFUL AT GE
GE had a huge advantage that accelerated our quality efforts: we had a Company that was open to change, hungry to learn and anxious to move quickly on a good idea.
Six Sigma is quickly becoming part of the genetic code of our future leadership
Quotes from GE Annual Report 1997
CHAMPION CERTIFICATION
Successful completion of Class-room training
+
Successful completion of at least One High impact Six Sigma Project in his work-area.
BLACK BELT CERTIFICATION

Class Room Training ( Phase 1) 6days
Carry out Six Sigma Project 12 weeks (app.)

Class Room Training ( Phase 2) 6days
Continue Six Sigma Project 12 weeks (app)

Evaluation and Certification
EVALUATION CRITERIA
Attendance during Class room training Phase 1 and 2 Faculty assessment during the training Obtaining Qualifying Marks in the Tests during training Successful completion of the Project
Evaluation of learning from project by expert
How to identify Six Sigma Projects?
IDENTIFY SIX SIGMA PROJECTS

Six Sigma Project Identification Process depends on the Objective of implementing Six Sigma:
Strategic Improvement Problem Solving.
IDENTIFY SIX SIGMA PROJECTS Problem Solving:

Fixes specific areas of high cost, rework, delays, Customer Complaints. With an urgency of results driving nearly every six sigma start-up, most organizations choose to jump on this objective. Only problem solving can not bring high impact on Business as there is always a dearth of problem after some time.
IDENTIFY SIX SIGMA PROJECTS

Strategic Improvement
Targets key strategic or operational weaknesses or opportunities. Strategic improvement effort lead to fewer key improvement projects with each project creating high business impact.
Strategic Projects
VOC R&D
New
Product
Product modifications
Time to market
Marketing New applications
Existing
Problem Solving
Existing
New
Customers
QFD FOR PROJECT IDENTIFICATION (Voice of Customers)

HOW
(Product/ Service Specification)
WHAT
(Voice of Customer) RELATIONSHIP MATRIX
Ranked Hows
HOW (Process Stages)
WHAT
(Ranked Product/
RELATIONSHIP
MATRIX
service Specification)
Ranked Hows
QFD FOR PROJECT IDENTIFICATION
(Voice of Shareholders)
HOW
(Process Stages)
WHAT
(Voice of
RELATIONSHIP MATRIX
Shareholders)
Ranked Hows
SELECTING HIGH IMPACT PROJECT
Priority-3
Priority-1
Priority-4
Priority-2
LOW CUSTOMER IMPACT

HIGH
MAPING THE VOICE OF CUSTOMER
CATEGORIES OF CUSTOMERS
1 WEAVING USE 40%
KNITTING USE
30%
INDUSTRIAL END USE
30%
RELATING CUSTOMER REQUIREMENTS TO

INTERNAL MEASURES
Sr.no Customer Requirements Degree of Quality parameters / Measures importance (Scale 1 to 9) Count Uster (%) Yarn Elongation IPI Yarn Length in WhitenessKnot/SpliceT.P.I. quality Variation Strength Hairiness Cone
1 2 3 4
Uniform Fabric 8 Fabric Strength 6 Productivity 5 Less Wastage 5 WEIGHTED RATING
9 3
3 9 9 3 114 3 15
3 3 3 57
3 3 9 60
3 1 3 45
3 3
90
24
24
24
42
Very important: 9 Somewhat important: 3 Low effect: 1

PROCESSES & THEIR EFFECT

Sr.no. Quality Measures Rating Fibre Blow Room Sub processes & their effect on quality measures Carding Drawing Simples Ring Winding Parallel Doubling Final Spinning Winding & Inspectio Twisting n & Packing 3 9 3 9 1 3 3 9 3 3 3 9 3 3 9 3 3 3 3 9 9 9 1,377 162 1,062 1,062 342 3 2,178 1,188 3 675 9 9 999
1 2 3 4 5 6 7 8 9 10
Count Variation Uster Yarn Strength Elongation IPI Hairiness Length in cones Whiteness Knot /Splice T.P.I. PROCESS RATING
90 24 114 15 24 57 60 24 45 42
1 9 9
Stage no. 1 2 3 4 5 6
Sub process
PRESENT SIGMA LEVEL

Checks Specification Limits USL LSL 66.00 Observed Performance for Oct'01 S.D. 0.067 Max 66.68 Avg. 66.40 Min 66.24 Moisture (%) Blend Variation Wrapping Cv Uster (%) Wrapping Cv Uster (%) Wrapping Cv Uster (%) Count Cv Uster (%) I.P.I. Hairiness Strength Elongation I.P.I. Uster (%) Hairiness Yarn Strength Length in cone Elongation Knot/Splice Str. Length Knot Strength Hairiness TPI Strength Elongation Uster (%) Visual Wt. Of carton 67.00
Cp
Cpk
Sigma Level
Fibre Blow Room Carding Drawing Simplex Ring Spinning
2.64
2.14
6.42
0.18 2.30 3.50 1.60 9.70 4.50 19.00 14.00 10.50 6.00 18.50 12.50
0.12 1.90 2.90 1.00 8.50 3.50 17.00 11.00 9.00 4.40 15.50 10.50
0.15 2.13 3.22 1.35 9.13 3.97 18.15 11.93 9.64 5.26 17.70 11.68
0.014 0.043 0.091 0.092 0.174 0.216 0.601 0.677 0.205 0.302 0.613 0.590
0.18 2.27 3.44 1.56 9.74 4.50 19.31 13.67 10.05 5.80 18.30 12.64
0.12 2.06 3.04 1.26 8.65 3.53 17.11 11.04 9.20 4.74 16.31 10.40
0.73 1.62 1.03 1.02 1.15 0.77 0.83 0.74 1.22 0.88 0.82 0.56
0.71 1.40 0.96 0.98 1.10 0.73 0.75 0.46 1.04 0.82 0.67 0.46
2.13 4.20 2.88 2.94 3.30 2.19 2.25 1.38 3.12 2.46 2.01 1.38
Winding
8 9
Parallel winding Doubling & Twisting
8.50 19.50 15.00 8.30
7.10 16.50 12.50 7.30
7.76 18.17 13.77 7.82
0.280 0.560 0.484 0.176
8.35 19.10 14.82 8.18
7.13 17.14 12.90 7.53
0.83 0.89 0.86 0.98
0.79 0.79 0.85 0.94
2.37 2.37 2.55 2.82
10 11
Final Inspection Packing
Average:
2.75
Project selection
High importance and Low Sigma Level characteristics are selected as Improvement projects
Stage no. 1 2 3 4 5 6 Importance 1377 162 1062 1062 342 2178 Sub process Fibre Blow Room Carding Drawing Simplex Ring Spinning Checks Moisture (%) Blend Variation Wrapping Cv Uster (%) Wrapping Cv Uster (%) Wrapping Cv Uster (%) Count Cv Uster (%) I.P.I. Hairiness Strength Elongation I.P.I. Uster (%) Hairiness Yarn Strength Length in cone Elongation Knot/Splice Str. Length Knot Strength Hairiness TPI Strength Elongation Uster (%) Sigma Level 6.42
2.13 4.20 2.88 2.94 3.30 2.19 2.25 1.38 3.12 2.46 2.01 1.38
1188
Winding
8 9
675 999
Parallel winding Doubling & Twisting
2.37 2.37 2.55 2.82
PROJECT IDENTIFICATION FROM VOICE OF CUSTOMER

Spg. Faults - Free Bales (G+R) Short Fibre % Prodn. In Moist. Range (1113) OTIF
O 3 1 9 3 1 1 3 3 3 3 3 9 3 9 3 3 3 9 Customer Voice
O CSP Shade Variation Imperfection Yield Delivery After Sales service Total 10 9 8 7 8 9 9 1 3 3 9 1 3 3 3 1 3 3 1 1 3 3 1 1 3 3 1 1 3 3 3 1 3 1 1 9 1 1 1 9 1 1 -
144
144
84
64
64
64
70 106 106 84 132 64 144 126
OPU
Product Specification
O 3 1 3 3 -
Time taken to resolve complaint
Long Fibre (M+P)
Bundle Tenacity
Neps per gram
Long Fibre 'S'
Brightness
Condition Elongation
Whiteness
Condition Tenacity
Priority
Denier
132
PRIORITISATION INDEX FOR SIX SIGMA PROJECT

RM procurement Maintenance Viscose Preparation CS2/Acid Preparation Invoice & Accounting ETP & WTP Order Processing After Treatment PRIORITY Storage & Despatch
PROCESSES / PRODUCT SPECIFICATION
Storage & issue
Recovery
Spinning
Baling & packing
Steam & power
Drying
1 2 3 4
Bundle Tenacity Condition tenacity % Prodn. In Moist. Range (11-13) Time taken to resolve complaint NEPS per gram
144 144 144
9 9
9 9 9
9 9 3
132 3 3 396
132 2592 2592
3 3 396 1692
2592
432
396
Skill
MAPING THE VOICE OF SHAREHOLDER
PRIORITISATION INDEX FOR SIX SIGMA PROJECT

Improvement in Reduction in VOICE OF SHAREHOLDER Priority Consumption Purchase Cost Ratios Raw Stores Raw Stores Materials Items Materials Items 1 Raw material Consumption 10 9 9 9 1
2 3 4 5 6 7 8 9 10 11
Reductio n in Working Capital
Reduction Increase in in Productivity Equipment Man Down time Machine Power
Steam Consumption Power Consumption Stores Consumption Repairs to Machinery Over Time Employee Cost Admn. Expenses Selling Expenses Interest Depriciation RELATIVE IMPORTANCE
10 10 8 6 3 3 1 1 3 1
9 9 1 1 1 1 1 1 1 1
296
3 3 1 3 1 1 1 1 1 1
188
3 3 1 1 1 1 1 1 1 1
176
1 1 9 3 1 1 1 1 1 1
132
1 1 1 1 1 1 1 1 1 3 1
62
1 1 1 3 3 1 1 1 1 1 1
84
1 1 1 3 3 1 1 1 1 1 1
84
1 1 1 1 1 1 9 1 1 1 1
80
GRASIM GRASILENE DIVISION : HARIHAR PRIORITISATION INDEX FOR SIX SIGMA PROJECT
Order Processing & Prodn. planning Storage & issue After Treatment Steam & power Generation RM procurement Maintenance ETP & WTP Invoice & Accounting Viscose Preparation CS2/Acid Preparation
PROCESSES / PRODUCT SPECIFICATION
Reduction in RM consumption Ratios CS Lye 10 9 Steam 10 3 Power 10 9 Coal 10 Reduction in Purchase cost of RM CS Lye 5 9 Sulphur 5 3 Charcoal 5 3 Reduction in Working Capital Steam Coal 3 Inventory Stores Spares 3 Inventory (FM) RM Inventory 3 75 210
1 9
1 9 9
1 9
9 9
3 9 9 9
9 9 100 190 100 180 10 210 90 3 63
Information System
PRIORITY
Storage & Despatch
Spinning
Recovery
Baling & packing
Drying
Skill
SIX SIGMA PROJECT - STEPS

There are 5 fundamental steps involved in applying the breakthrough strategy for achieving Six Sigma.
Define Measure Analyze Improve Control

DMAIC
DEFINE
Develop Business case and Team charter Map the Current Process Listen to the Voice of Customer Define the Scope and Purpose Define the boundaries Expected resource needs Project Timeline
MEASURE
Collect baseline data that pinpoints problem location and occurrence Develop a sampling strategy Validate your measurement system Determine Process Capability and Sigma Level Learn concepts and tools needed to collect reliable and accurate data A focused problem statement
ANALYZE
Process door Vs Data door Identify potential causes ( Y= f (X1, X2, X3, Xn)) Create detailed process map and do value-added flow analysis
Find, change in which Xs affect Y and in what manner, using Statistical Techniques. Ultimately find which Xs are critical to move the Y in the desired direction and at what level those Xs are to be maintained
IMPROVE
Evolve an effective solution that addresses the root cause of the problem. Evolve Should Process and its potential impact ( costbenefit analysis) Assess risks and conduct Pilot Implementation
Routine implementation plan including budget, time line

and responsibilities.
CONTROL
Develop Control plans and Control Charts to ensure that gains are maintained. Routine Implementation of Control Plan.
Standardize and Document effective methods

Evaluating Results, Summarize key learning's
Conduct revalidation when changes occurs in the Process / Product.

Integration with Business planning

Perspective Financials : What do share holders expect and what objectives on the financial perspective does this imply? Perspective Customer / Markets: Which objectives have to be set in order to satisfy our customers and to achieve the financial targets? Perspecitve Internal Processes: Which objectives have to be set regarding our processes in order to fulfill the customer expectations in light of the market conditions? Perspective Learning and Growth: Which objectives have to be set in order to develop crucial knowledge base, employees skills and future technologies? Objectives
Objectives
Objectives
Objectives
Identify Six Sigma Project during Business Planning Cause-and-Effect Relationships Market share Customer Loyalty Process Quality
Financial
Customer
On-time Delivery Process Cycle Time Employee Skills

From: R.S. Kaplan and D. Norton
Process
Learning & Growth
Institutionalization
Leaders make decisions based on facts, reacting swiftly to signals and thoroughly to noise
The project portfolio is well balanced, projects have a clear business case, and strategic theme drive projects The voice of customer is used to identify projects Projects permeate every part of the organization, not only operations Business processes are managed to achieve competitive advantage Improving business processes is perceived as a critical leadership competency Not being a Belt is a career disadvantage
Six Sigma tools are used to address major challenges of the business.
For the successful implementation of a strategy

abilities
+ action plan + resources + incentives + information

action plan
= confusion
goals
+ + + + + +
abilities
+ resources + incentives + information

resources
= fear
goals
+ + action plan +
+ incentives + information
incentives
= failing launch
goals
abilities
+ information + information
= frustration
goals
abilities
+ action plan + resources + action plan + resources + incentives
= little change
goals
abilities
= chaos
goals
abilities
+ action plan + resources + incentives + information
= intended change
89
source: Motorola University (adapted by Horvth)
12/20/2012
PEOPLE CAN BE DIVIDED INTO THREE CATEGORIES

THOSE WHO MAKE THINGS HAPPEN
J K L
THOSE WHO WATCH THINGS HAPPEN
THOSE WHO WONDER WHAT HAPPENED

1.introduction SFD

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INTRODUCTION TO SIX SIGMA

What is Six Sigma?

WHAT IS SIX SIGMA?

Output of process in Time Sequence

Output of processes in Time sequence

Big Y vs Small Ys:

Big Y vs Small Ys:

Big Yvs Small Ys:

Chart for OUTPUT/Hr.

1 UCL=357.7 Mean=340.4 LCL=323.2

1 1 1 1 11 11 1 11 11 1 1 111 111 11 1 1 11 1 1 1 1 11 11 1 11 1 1 11 11 1 11 1 1 1 1 0 100 200

WHAT IS SIX SIGMA?

SIGMA RATING AND LEVEL OF DEFECT Sigma Rating

69.2 93.2 99.4 99.98 99.9997

ppm: Parts per million

WHAT IS SIX SIGMA?

99.73% IS NOT ENOUGH ?

Three Sigma versus Six Sigma

SHOULD ALL PROCESSES BE AT SIX SIGMA?

WHAT IS SIX SIGMA?

Basic Tenets of Six Sigma

Speak with facts

NO COMPANY MAKES MONEY INSIDE THE ORGANISATION

SO, WHAT IS THE REAL PURPOSE OF BUSINESS ?

THE REAL PURPOSE OF BUSINESS IS:

AND SATISFYING THEM

Customer Orientation Every Organization is like a Relay Race MARKETING C U S T O M E R DESPATCH

Focusing on the Inside will hurt ...

ENVIRONMENTAL INFLUENCES (Government, Economy, Culture)

Wont go the Distance

Marketing Engineering Production Dispatch

Marketing Engineering Production Dispatch

FUNCTIONAL vs PROCESS TARGET

Right Quality Quantity Price Time

M1-I M1-E Customer

Speak with Facts

Speak with Facts

IN GOD WE BELIEVE, FOR EVERYTHING ELSE

Speak with Facts

Speak with Facts

DATA COLLECTION: OBJECTIVE?

Know current Status

What is Six Sigma?

achieving , sustaining and maximizing Business success

What is Six Sigma?

WHAT DID THEY ACHIEVE FROM SIX SIGMA?

WHAT MADE SIX SIGMA SUCCESSFUL AT GE

Six Sigma Costs and Savings at GE

Asea Brown Boveri

ABB, after application of Six Sigma has reduced

SIX SIGMA IMPLEMENTATION

PROJECT BY PROJECT APPROACH

WHATEVER IS NOT A PROJECT WILL NOT GET IMPROVED.

Training People on Six Sigma

Integration with Business Planning Process Institutionalization

ORGANIZATION FOR SIX SIGMA

Six Sigma Black Belt works with:

The resolve to attain greater heights

Six Sigma Black belts believe that

Standards exist to be superseded

SIX SIGMA ORGANIZATION

Responsibilities of Management Team