1. Information United System Consulting Group
(Member of Tariq Alghanim Holding)
Six Sigma – An Introduction
Program : 6th September 2007
By: Ravi Kalimuthu
Specially Designed for Tamilnadu Engineers Forum
Venue: Caesars Restaurant. Fahaheel
copyrights- IC Group 2007
2. About the Tutor.
Business Development Manager &
Management Consultant
20 Years experience in Industrial &
Management Sector
Certified Si Si
C tifi d Six Sigma Green belt & ISO
G b lt
9001:2000 Lead Auditor
Conducted More than 40 Training Ravi K li th
R i Kalimuthu
Programs in Several titles in
Management & Technical
3. About Information United System Consulting
Group. (IUSC Group)
(A Member of Tariq Al Ghanim Holdings)
Provides Management Consultancy
Services
One stop solution for any business
needs
Consultancy provided >40 clients
5. Certification related services
ISO 9001:2000 – Quality Management System
ISO 14001:2004 – Environmental Management
System
OHSAS 18001:2002 – Safety Management
System
ISO 22000:2005 – Food Safety Management
System
ISO 27001:2005 – Information Security
Management System
and more……
d
6. Value added services
Training & Implementation of Six Sigma
Establishing KPIs Performance
KPIs,
measurement system & Balanced
Scorecard
Development of vision & values
Business Plan
l
Business Process Re-engineering
7. Value added services
Support services for effective
implementation of ISO systems
p y
Implementing total quality management
Implementing cost management
concepts like activity based costing and
quality costing etc.,
Implementing 5 ‘S’
Consultancy on CE marking
8. Training services
Support for sustaining International
standards certification
Tailor made in-house programs
Knowledge reach to 175 topics specially
g p p y
designed for improving business
9. Before we start !!!
Your participation is key to success…
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11. Contents
What is Six Sigma?
Why Six Sigma?
Comparison of various management initiatives
Overview of six sigma and lean principles
Role of Green Belt
Project Management Idea
Process Mapping & Process Management
Team Dynamics and Techniques
y q
Appreciating the use of QFD
12. What is Sigma (σ)
The
Th term ‘Si ‘Sigma’ taken f
’ k from the G k alphabet, i
h Greek l h b is
used to designate the distribution or spread about the
mean (average) of any parameter of product, process or
( g ) y p p , p
procedure. Six Sigma is a system of practices originally
developed by Motorola to systematically improve
processes by eliminating defects The process was
defects.
pioneered by Bill Smith at Motorola in 1986 and was
originally defined as a metric for measuring defects and
improving quality, and a methodology t reduce d f t
i i lit d th d l to d defect
levels below 3.4 defects per one million opportunities
(
(DPMO). )
13. What is Six Sigma (6σ)
Level of process performance equivalent to
producing only 3.4 parts per million defects or
has a yield of 99.9997%.
14. What is Six Sigma (6σ)
Six Sigma is a long-term, forward-thinking initiative
designed to fundamentally change the way corporations
do business.
It is first and foremost "a business process that enables
companies to increase profits dramatically by streamlining
operations, improving quality, and eliminating defects or
mistakes in everything a company does.
While traditional quality programs have focused on
detecting and correcting defects, Six Sigma encompasses
something broader: It provides specific methods to re re-
create the process itself so that defects are never
produced in the first place."
15. What is Six Sigma (6σ)
Six Sigma has evolved over the last two
decades and so has its definition. Six
definition
Sigma has literal, conceptual, and practical
definitions.
definitions Six Sigma can be taken at three
different levels:
As a metric
As a methodology
As a management system
Essentially, Six Sigma is all three at the
same time.
16. Six Sigma as a Metric
The term "Sigma" is often used as a scale
for levels of "goodness" or quality. Using
this scale, "Six Sigma" equates to 3 4
scale 3.4
defects per one million opportunities
(DPMO). Therefore
(DPMO) Therefore, Six Sigma started as a
defect reduction effort in manufacturing
and was then applied to other business
processes for the same purpose.
17. Six Sigma as a Methodology
As Six Sigma has evolved, there has been less
emphasis on the literal definition of 3.4 DPMO, or
counting defects in products and processes. Six
Sigma is a business improvement methodology
that focuses an organization on:
Understanding and managing customer
requirements
Aligning key business processes to achieve those
requirements
Utilizing rigorous data analysis to minimize
variation in those processes
Driving rapid and sustainable improvement to
business processes
18. Six Sigma as a Methodology 2
At the heart of the methodology is the DMAIC
model f process i
d l for improvement. DMAIC i is
commonly used by Six Sigma project teams
and is an acronym for:
y
-Define opportunity
-Measure performance
-Analyze opportunity
A l t it
-Improve p
p performance
-Control performance
19. Six Sigma Management
When practiced as a management system, Six
Sigma is a high performance system for executing
business strategy Six Sigma is a top down solution
strategy. top-down
to help organizations:
•Align their business strategy to critical improvement efforts
•Mobilize teams to attack high impact projects
•Accelerate improved business results
•Govern efforts to ensure improvements are sustained
The Six Sigma Management System drives clarity
around the business strategy and the metrics that
most reflect success with that strategy. It provides
the framework to prioritize resources f projects
h f k for
that will improve the metrics, and it leverages
leaders who will manage the efforts for rapid,
g p ,
sustainable, and improved business results.
20. Determining Sigma Level
g g
Determining sigma levels of processes (1 sigma, 6 Sigma etc)
allows process performance to compared throughout the
organization. Sigma is a statistical term that measures how
i ti Si i t ti ti l t th t h
much a process varies from perfection, based on the
number of defects per million units.
p
1 Sigma = 690,000 DPMO = 30.9% Final yield
2 Sigma = 308,000 DPMO = 69.2%
3 Sigma = 66,800 DPMO = 93.3%
4 Sigma = 6,210 DPMO = 99.4%
5 Sigma = 320
Si DPMO = 99.8%
99 8%
6 Sigma = 3.4 DPMO = 99.9997
21. The Cost of Quality
Sigma level DPMO Cost of Quality
2 308,507(non
, ( NA
competitive
companies)
3 66,807 25 – 40% of
Sales
4 6,210 (Industry 15 -25% of
Average) Sales
5 233 5 – 15 % of
sales
6 3.4 (
3 4 (world class)
ld l ) <1% of sales
1% f l
Each sigma shift provides a 10% net income improvement.
22. Impact of six sigma implementation at GE
(results achieved over first 2 years 1996-1998)
( lt hi d fi t 1996 1998)
- R
Revenues have risen to $100 billion, up 11%
h i t billi
- Earnings have increased to $9.3 billion, up
13%
- Earnings per share have grown to $2.80, up
14%
- Operating margin has risen to a record 16.7%
- Working capital turns have risen sharply to
9.2%, up from 1997's record of 7.4
23. Why Six Sigma? Is it necessary to go for zero defects?
Why isn’t 99.9% defect-free good enough? Here are some examples of
what life would be like if 99.9% were "good enough:"
-1 HOUR OF UNSAFE DRINKING WATER EVERY MONTH
- 2 LONG OR SHORT LANDINGS AT EVERY AMERICAN
AIRPORTS EACH DAY
- 400 LETTERS PER HOUR WHICH NEVER ARRIVE AT
THEIR DESTINATION
- 500 INCORRECT SURGICAL OPERATIONS EACH WEEK
- 3,000 NEWBORNS ACCIDENTALLY FALLING FROM
THE HANDS OF NURSES OR DOCTORS EACH YEAR
- 4,000 INCORRECT DRUG PRESCRIPTIONS PER YEAR
- 22,000 CHECKS DEDUCTED FROM THE WRONG BANK
ACCOUNT EACH HOUR
- 32,000 MISSED HEARTBEATS PER PERSON PER YEAR
24. Why Six Sigma? Is it necessary to go for zero defects?
Here are some examples of what life would be like at
Six Sigma
-13 WRONG DRUG PRESCRIPTIONS PER YEAR
13
-10 NEWBORNS ACCIDENTALLY FALLING FROM THE
HANDS OF NURSES OR DOCTORS EACH YEAR
- 1 LOST ARTICLE OF MAIL PER HOUR
30. Various Management
Initiatives
CAN ONE INITIATIVE WORK WITHOUT THE OTHER
1. For Losses (TPM), Measurements
1 F L (TPM) M t
(Six Sigma) are essential
2. For Measurement (Six Sigma),
Systems (QMS) are essential
3. For Systems (QMS), People
(TQM) are essential
31. Summary
y
All the initiatives are complementary to each other. .The
continued focus is the key factor. It is prudent to integrate
each initiative with the fundamental QMS like ISO
9001:2000 The ff
9001 2000 Th effort should b to take the people along
h ld be k h l l
the process
32. Five Pillars of TQM
Q
PRODUCT
EFFECTIVENESS WASTE ELIMINATION
PROCESS
SYSTEM RE-ENGINEERING
PEOPLE
SUITABILITY CULTURE & MATURITY
LEADERSHIP
33. Six Sigma
Process standard Vs Performance Standard
Six Sigma Vs ISO 9001
Is
I process and performance related
d f l t d
What is important in business
Performance should consider both internal and
external needs
Measurement is the key.
Measure what is important or what is needed
M h ti i t t h ti d d
Measurement without a target is meaning less
Deviation from target is defect
Defect is more important to customer than reject
34. DPMO Vs PPM
Six Sigma demands 3.4 Defects per
Million Opportunity
35. Why the name “Green Belts”?
The name Green belts comes from the sport of
Karate. Both Karate and Six Sigma depend on
mental discipline and systematic, intensive training.
Just as black belts in Karate depend on power, speed
and decisiveness, Six Sigma green belts should also
depend on the same qualities. Six Sigma Green belts
also must be able to reposition themselves as they
move from one project to another.
36. Characteristics of Six Sigma Green Belt
Proper understanding of Deliverable & CTQ.
Proper Understanding of DMAIC steps
Speaks the language of money time organizational
money, time,
objectives.
Understands Project Charter and base line performance
An expert in SPC and continuous improvement tools.
Capable of i l
C bl f implementing standardization methods
ti t d di ti th d
Drives change by challenging conventional wisdom.
Anticipates and confronts problems proactively and solves
them.
38. Define phase
This h
Thi phase d fi
defines th project. It id tifi critical
the j t identifies iti l
customer requirements and links them to business
needs. It also defines a project charter and the
business processes to be undertaken for Six Sigma.
Note: This phase is extensively covered in a
separate chapter “Define phase”.
39. Measurement phase
This phase involves selecting product characteristic
characteristic,
mapping respective process, making necessary
measurements and recording the results of the
process. This is essentially a data collection phase.
Note: This phase is extensively covered in a
separate chapter “Measurement phase”.
40. Analysis phase
In this phase an action plan is created to close the
p p
“gap” between how things currently work and how the
organization would like them to work in order to meet
the goals for a particular product or service This phase
service.
also requires organizations to estimate their short term
and long term process capabilities.
Note: This phase is extensively covered in a
separate chapter “Analysis phase .
Analysis phase”
41. Improvement phase
This phase involves improving processes/product
p p g p /p
performance characteristics for achieving desired results
and goals. This phase involves application of scientific tools
and techniques for making tangible improvements in
profitability and customer satisfaction.
Note: This phase is extensively covered in a
separate chapter “Improvement phase”.
42. Control phase
This phase requires the process conditions to be properly
documented and monitored through statistical
process control methods. After a “settling in” period, the
process capability should be reassessed. Depending
upon the results of such a follow-up analysis, it may be
sometimes necessary to revisit one or more of the
preceding phases
phases.
Note: This phase is extensively covered in a
separate chapter “Control phase”.
43. Key steps of the define phase
A.
A Identify project which are critical to
customers.
B.
B Develop team charter / action plan.
plan
C. Define process map.
Each t
E h step is discussed i detail in the following
i di d in d t il i th f ll i
slide.
44. Deliverable & CTQ
Department/ Function : Accounts 1
S.no Deliverables CTQ Measurement method Acceptable criteria Remarks
Agreement with
1 Customer reconcilations Correct statement of accounts customer book
Timely updation Every month
Respective date for
various submission as
2 Fili of various returns
Filing f i s t s Timely s b issi
Ti l submission per matrix
i
Accuracy
y No penalty Late fees
p y
Interest to the company
Branch and profit-centre wise
3 profitability
fit bilit Timely submission of statements By 25th of every month
Accuracy of report
45. Deliverable & CTQ
S.no Deliverables CTQ Measurement method Acceptable criteria Remarks
Delivery challan
1 Receipt of material Correct inwarding of quantity Zero Variance
30% reduction from
Visual
Reduction in unloading time present condition
Documentation flow to
SAP
2 excise department Timely issue of documents 1 Day
SAP
Accuracy of information
y Zero Variance
warranty claim
3 Cost Optimization 1.Re use warranty material To be decided
2. Reduction of cost through material 30% reduction in
Visual
handling equipments present situation
Improve 50% floor
Store Layout
3. Use of floor space space
VSM
4. Recycling of cotton waste 10% cost savings
SAP
5.
5 Reduction of non moving material
non-moving To b d id d
T be decided
46. Operations related :- Marketing
1. Accuracy of forecast assumptions.
2. Number of incorrect order entries.
3. O
3 Overstocked field supplies.
t k d fi ld li
4. Contract errors.
5. Late deliveries.
6.
6 Customer complaints.
complaints
7. Warranty cost as a percentage of sales.
47. Operations related :- Purchase
1. Premium freight cost/ demurrage charges.
2. Down - time because of parts shortages.
3. Number of Off specification parts used to keep line
going.
4. Cycle time from start of purchase request until
items in house.
5. Excess inventory.
6. Percentage of purchased material rejected on
receipt.
48. Operations related :-
Manufacturing
1. Yield per ton of raw materials.
2. Percentage of parts scrapped.
3. Percentage of parts reworked.
4. Percentage of parts accepted on concession.
5. Percentage of final p
g product g
graded as
seconds.
6. Production per man / machine.
p
49. Operations related :- Product engineering
1. Number of engineering changes per document.
2. Number of errors found during design review.
3. N
3 Number of errors found in design evaluation test.
b f f di d i l ti t t
4. Percentage of time over- run compared to
planned ti
l d time for development.
f d l t
5. Percentage of cost over - run over estimated cost
of d
f development.
l t
6. Number of tooling redesign after trial production.
50. Operations related :- Quality Assurance
1. Percentage of lots rejected due to errors.
2. Percentage of products having defects detected
by customers.
3. Number of engineering changes that should have
been detected in design review.
4. Errors in inspection / test reports.
5. Cycle time t get corrective actions.
5 C l ti to t ti ti
6. Percentage of appraisal cost compared to
production cost.
d ti t
51. Operations related :- Product reliability
Mean time to failure.
Failure rate
rate.
Probability of failure occurrence during given
time interval.
interval
Probability of failure non-occurrence during
given time interval.
i e ti e i te l
Mean life time.
Mean time to first generate overhaul.
Mean time to repair.
repair
52. Ope at o s e ated
Operations related :- Accounting
ccou t g
1. Percentage of late payments.
2. Time to respond to customer request for
information.
3. Billing errors.
4. Incorrect accounting entries.
5. Payroll errors.
6. E
6 Errors in cost estimates.
i t ti t
53. Customer related
Market share
Market penetration
New markets identified
Overall customer satisfaction
Customer complaints
Customer retention
R&D expenditure as a percentage of sales
New products and services introduced
p
Sales per employee
54. Six Sigma – Tools and Techniques
Quality
Q li Functioni Analysis f
A l i of variance
i
Deployment Correlation and Regression
Design of experiments Chi-Square
q
7 QC tools Control charts
New 7 tools Control plans
Measurement system Robust design
analysis Cost of quality
Process mapping Reliability Engineering
Project Management Quality
Q lit systems
t
FMEA Fault tree analysis
SPC
T–T t
Test
55. Certification of Six Sigma
Option I – Certification as Six Sigma Green Belt
Becoming certified as a Six Sigma Green Belt confirms your commitment to quality and the positive impact it
will have on your organization. The Six Sigma Green Belt operates in support of or under the supervision of a
Six Sigma Black Belt, analyzes and solves quality problems and is involved in quality improvement projects.
Option II – Certification as Six Sigma Black Belt
Becoming certified Six Sigma Black Belt leads the quality or core process team involve in the data analysis. The
Six Sigma Black belt guides the green belt in taking the decisions with respect to quality problems and direct
quality improvement projects
Certification procedure:
ASQ (American Society for Quality) offers the certification programmes in various field of discipline. In today’s
world, where competition is a fact of life and the need for a work force proficient in the principles and practices
of quality is a central concern of many companies, certification is a mark of excellence. It demonstrates that the
q y y p ,
certified individual has the knowledge to ensure the quality of products and services. Certification is an
investment in your career and in the future of your employer.
Training procedure:
The Information United System Consulting Group offers extensive training for management staffs in order to
achieve the certification for Six Sigma black belt and Six Sigma green belt. The training avenues could be as
follows:
•In-house training can be conducted within the premises of any Company
•External training
60. Our Training Programs
*October 3rd Week 2007 – Six Sigma Green Belt Certification
Program
( A 3 Day Program)
*November 3rd Week 2007 – ISO 9001:2000 Lead Auditor
Certification Course
(A 5 Day program)
Please enroll in our training programs to attain career
development and call us for any of your training &
Management consultancy needs…
needs
* Tentative Schedule
61. Thank you for your Time & Involvement
If need any clarifications or for assistance, please
feel f
f l free to conduct me on M bil +965 9529846
t d t Mobile:
or write to me in email: Ravi.km@usa.net
