1. Six Sigma
Presented By:-
Amit Kumar
DMS
Pondicherry University

2. What is six sigma?
•Sigma is a measure of “goodness: the capability
of a process to produce perfect work.
• Sigma indicates how often defects are likely to occur.
• The higher the sigma level, the lower the defect rate.
• The lower the defect rate, the higher the quality.

3. Sigma Conversion Table:
If your yield is: Your DPMO is: Your Sigma is:
30.9% 690,000 1.0
62.9% 308,000 2.0
93.3 66,800 3.0
99.4 6,210 4.0
99.98 320 5.0
99.9997 3.4 6.0

4. The Six Sigma Evolutionary Timeline
1986: Bill Smith, a senior 1995: Jack Welch
engineer and scientist launches Six Sigma at
introduces the concept of GE.
Six Sigma at Motorola
1994: Larry
Bossidy launches
Six Sigma at
Allied Signal.

6. in General Electric
Imagination at Work

7. General Overview
 The General Electric Company (GE) is a
multinational American technology and services
conglomerate incorporated in the state of New
York.

8. Group Companies of GE
 Radio Corporation of • GE Infrastructure
America (RCA) • GE Money
• The Electric Bond and • GE Security
Share Co • GE Industrial
• GE Commercial
 GE Healthcare
Finance
• GE Consumer
Finance

9. • Welch’s Corporate Model:
– High Discipline
– High Efficiency
– Cut costs whenever possible
• Per Annum organic growth rate:
– Only 4%

10. • Implementation of lean Six Sigma methodology for
manufacturing and service processes
• Originally established in U.S. by Motorola
• Goal: meet or exceed level of 3.4 defects per million
operations within any process

11. General Electric
• In 1995 GE mandated each employee to work towards
achieving 6 sigma
• The average process at GE was 3 sigma in 1995
• In 1997 the average reached 3.5 sigma
• GE’s goal was to reach 6 sigma by 2001
• Investments in 6 sigma training and projects reached
45MUS$ in 1998, profits increased by 1.2BUS$
“the most important initiative GE has
ever undertaken”. Jack Welch
Chief Executive Officer
General Electric

12. 1995 Operating margin—13.5%
1998 Operating margin—16.7%
Result: $600million bonus

13. Six Sigma Results
Company Annual Savings
General Electric $2.0+ billion
JP Morgan Chase *$1.5 billion (*since
inception in 1998)
Motorola $ 16 billion (*since
inception in 1980s)
Johnson & Johnson $500 million
Honeywell $600 million
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