An Introduction to An Introduction to Six Sigma QualitySix Sigma Quality

Presented by Darlene Mackay, CSQA

Quality Assurance Institute

Presentation AgendaPresentation Agenda

1. What is Six Sigma Quality?

2. Why would a company adopt Six Sigma?

3. Is there a roadmap to Six Sigma?

4. What are the challenges?

5. What are the rewards?

1.1. What is Six Sigma Quality?What is Six Sigma Quality?

Originated at Motorola in the early 80’s

Helped Motorola win the 1988 MBNQA

Is a methodology for disciplined quality improvement

Juran principles apply Doesn’t use “Quality” in

the name

With the inclusion of Six Sigma into a sound business system, the major ingredients of a Total Quality Management System are usually in place

Uses a modified Deming Wheel (PDCA)

JURAN SAID…JURAN SAID…

“All quality improvement occurs on a project-by-project basis and in no

other way.”

What is Six Sigma Quality?What is Six Sigma Quality?

Six Sigma’s goal is the near elimination of defects from any process, product, or service.

The numerical goal is 3.467 defects per million opportunities.

Juran once concluded that in the US, close to 1/3 of the work done consisted of redoing what had already been done.

Depending on the industry, this Cost of Poor Quality (COPQ) could be 20 to 40% of total effort!

Six Sigma Process CapabilitySix Sigma Process Capability

SIGMA DPMO COPQ CAPABILITY

6 sigma 3.4 <10% of sales World Class

5 sigma 230 10 to 15% of sales

4 sigma 6200 15 to 20% of sales Industry average

3 sigma 67,000 20 to 30% of sales

2 sigma 310,000 30 to 40% of sales Noncompetitive

1 sigma 700,000

What is Six Sigma Quality?What is Six Sigma Quality? Strategy includes:

– Measure– Analyze– Improve– Control

Improvement projects must be integrated with the goals of the organization.

Six Sigma uses a “divide and conquer” approach as opposed to Continuous Process Improvement.

Implementation is top-down. CEO drives, and executive management provides the Champion for each project.

GE’s implementation is often the de facto model for implementation.

Uses concept of “belts” for levels of competency in Six Sigma implementation:– MBB = Master Black Belt– BB = Black Belt– GB = Green Belt

An ExampleAn ExampleSix Sigma Project: Engineering Changes

Define: Large number of changes from client after approving engineering design. Schedule slipping.

Measure: Number of changes, time involved in changes, compliance to critical path schedule.

Analyze: No clear authority on client team to establish scope, any of client team could make changes, verbal communication of changes, conflicting changes by client team members. Language issues between client and engineers.

Improve: Regular engineering/client meetings where topics include: scope for each section and desired objective, known limitations defined, unclear requirements were questioned and options discussed. Written plan signed by client representative and engineering lead. Change requests in writing and signed by client representative. Changes decrease by factor of 4.7 and schedule met.

Control: Change requests all in writing. Shared approach with other disciplines on project.

From: www.adamssixsigma.com/Sample_Projects/six_sigma_projects.htm

What is Six Sigma Quality?What is Six Sigma Quality?

All Six Sigma projects are evaluated rigorously for financial impact.

Most important is the financial cumulative impact of all projects upon the company’s bottom line.

Some Results…Some Results…

Motorola – 10 years; $11 Billion Savings Allied Signal - $1.5 Billion estimated savings General Electric – started efforts in 1995

– 1998: $1.2 Billion less $450 Million in costs… net benefits = $750 Million

– 1999 Annual Report: more than $2 Billion net benefits

– 2001: 6,000 projects completed; $3 Billion in savings

Six Sigma according to GESix Sigma according to GE

“A highly disciplined process that helps us focus on developing and delivering near-perfect products and

services. The word Six Sigma is a statistical term that measures how far a given process deviates from

perfection. The central idea behind Six Sigma is that if you can measure how many “defects” you have in a

process, you can systematically figure out how to eliminate them and get as close to “zero defects” as

possible. Six Sigma has changed the DNA at GE – it is the way we work – in everything we do and in every

product we design.”

2.2. Why would a company Why would a company adopt Six Sigma?adopt Six Sigma?

Concept has been around for 16 years; isn’t just a fad.

Six Sigma is the latest name for a comprehensive set of philosophies, tools, methods, and fundamental concepts.

Continues to evolve at all organizational levels; from CEO and CFO to the Black Belts and Green Belts.

Has shown the most endurance and return on investment of any such “program” till now.

3.3. The Roadmap to Six SigmaThe Roadmap to Six Sigma

North

South

East West

Usually has many twists and turns!

A Road Map for Six SigmaA Road Map for Six Sigma

Appoint a Champion Select a Cross-functional team Develop quantifiable goals Develop an implementation plan

Establish a training program Address data collection requirements and issues Develop a change control and maintenance program

Coordinate your road map

Article by John M. Gross, ASQ, Quality Progress Magazine, November 2001

4.4. What are the Challenges What are the Challenges of Six Sigma?of Six Sigma?

The perception of “Sick Sigma”

Culture change Understanding the DFSS

(Design For Six Sigma) It is not a quick fix nor a

recipe. Consultants can’t make

it happen.

Training – especially management level

Takes careful preparation and a commitment to the foundational change efforts required.

Statistical analysis is not generally part of the engineering discipline in most IT shops.

What are the Challenges of What are the Challenges of Six Sigma?Six Sigma?

Implementation tends to be uneven and lapses occur frequently.

Not everything has to be Six Sigma; this was our downfall on reengineering efforts!

Lack of discipline and accountability.

Reliability of data from the field.

People must not fear giving “bad news”.

Design is critical and yet many IT organizations continue to go straight from poor requirements into coding without the benefits of even one design review.

5.5. What are the Rewards ofWhat are the Rewards ofSix Sigma?Six Sigma?

Improved reliability and predictability of software products and services.

Increased value to the customers and shareholders.

Improvements in organizational morale.

Increased marketplace viability.

Organizational recognition.

Significant reduction in defects.

Institutionalization of a “process” mindset.

Some ReferencesSome References

Joseph M. Juran: Juran’s Quality Handbook

(McGraw-Hill, 1999)

Mikel J. Harry: Six Sigma, A Breakthrough Strategy for Profitability (Quality Progress, May 1998)

William J. Hill: Six Sigma at Allied Signal, Inc. (Presentation at 1999 Q&P Research Conference, May 1999)

Jack Welch: Six Sigma, the GE Way

Six Sigma Forum Magazine: www.asq.org/pub/sixsigma

Your favorite Search Engine: search on “Six Sigma”