In Manufacturing Industry

PRATEEK CHHAJER

SAMTA PUROHIT

MBA-PM-05

IIHMR, Jaipur

What is Six Sigma?

• Quality objective that specifies the variability required of a process in terms of the specification of the product so that the products quality and reliability meets and exceeds the customers requirements– Process of eliminating defects

• Operate with defect levels below 3.4 defects per million opportunities

– Improvement to all company processes• Decrease process variation

• Increase stability in design

Relationship to Statistical Analysis

• Sigma (σ)– Used to represent standard deviation in a process

(standard deviation is a measure of variability)

• Based on the perception that most processes follow the normal distribution– Mean (or expected value) = μ

– Standard Deviation = σ

Sigma Correlation to Defects

691,462308,538

66,807

6,210

233

3.4

1

10

100

1,000

10,000

100,000

1,000,000

0 1 2 3 4 5 6 7

Sigma Value

Defe

ct p

er m

illio

n op

portu

nitie

s

Sigma % Good % Bad

Defects per million

opportunities

1 30.90% 69.10% 691,462

2 61.80% 30.90% 308,538

3 93.30% 6.70% 66,807

4 99.38% 0.62% 6,210

5 99.977% 0.023% 233

6 99.9997% 0.00034% 3.4

**graph shown on logarithmic scale**

Origin of Six Sigma• Companies that early embraced Six Sigma in manufacturing were

Motorola & General Electric. Their version of Six Sigma is focused on six key principles which are discussed by Bicheno (2006).

• Critical to Quality: The customer is the start and what is important for the customer needs to be identified.

• Defect: Anything that does not deliver exactly what the customer wants• Process Capability: The processes need to be able to deliver what the

customer wants• Variation: As it is experienced by the customer• Stable Operations: The goal is to secure reliable, robust processes that

improve the customer’s experience.• Design for Six Sigma: The design must meet all the customer requirements

and the capability of the process.

Six Sigma- Implementation and Use

• Examples of pharmaceutical companies that have implemented Six Sigma are Baxter, Eli Lilly, Johnson & Johnson and Novartis (Stückrath 2006).

• One barrier to a successful implementation of Six Sigma is the inbuilt natural resistance to change in people

• The best way to handle the resistance to change is increased communication, motivation and education.

• Communication is also crucial to success with the Six Sigma implementation.

• This focus on communication ensures that all employees are aware of the Six Sigma activities even though not everyone is involved in the actual projects.

• Snee (2004) states, that the most important element when implementing Six Sigma is the commitment of organization leaders, since they have the greatest opportunity to affect the outcome.

• O´Rourke (2005) describes three specific activities that need to be performed by the top management to facilitate the implementation.

1. Engagement and commitment from the start with a firm belief that this is the strategic effort that will address the needs of the business.

2. A long-term plan with performance goals that reflects the gains of the implementation.

3. Resource allocation ensuring that the right people get the responsibility and authority to drive the implementation.

Benefits of Six Sigma

• Reduction in costs

• Reduction in waste chain

• Better understanding of customer requirements

• Improves quality performance

• Develops robust products and processes

• Provides critical process inputs

Stages of six sigma process

Define

Measure

Analyze

Improvement

Control

Sectors where Six Sigma is used

Companies Currently Implementing Six Sigma:

• Motorola

• 3M

• Lockheed Martin

• Texas Instruments

• Bell Helicopter

• Apple Computer

• Chevron

• Citigroup

• Hewlett Packard

• Ford Motor Company

• Honeywell

• General Dynamics

• Adolph Coors

• Eastman Kodak

• United States Army

• Xerox

• NASA

• Etc.

Summary

• Six Sigma integrates the principles of business, statistics and engineering to achieve tangible results

– Customer satisfaction

– Lean processes (with minimal variation)

– Quality as a way of doing business

THANK YOU