An Introduction to Six Sigma Quality Presented by Darlene Mackay, CSQA Quality Assurance Institute
Presentation 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?
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) 1. What is Six Sigma Quality?
JURAN SAID… “All quality improvement occurs on a project-by-project basis and in no other way.”
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! What is Six Sigma Quality?
Six 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
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 What is Six Sigma Quality?
An Example Six 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
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. What is Six Sigma Quality?
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 Some Results…
Six 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.”
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. 2. Why would a company adopt Six Sigma?
The Roadmap to Six Sigma North East West South Usually has many twists and turns!
A 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
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. 4. What are the Challenges of 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. What are the Challenges of 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. 5. What are the Rewards ofSix Sigma?
Some 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”