Six Sigma

Shift in Business Focus

Business
Focus

<1950

1950
1980s
to1970s

1990s

2000s

Productivity
Quality
Customer
Satisfaction
Cost
Agility/Speed
Flexibility
Adaptability
Product life
cycle

What is Six Sigma...

Six Sigma is a business concept that answers
customers demand for high quality and
defect-free business processes.

Six Sigma was born when Motorola published

its Six Sigma quality program in 1987.

Six Sigma is a unified approach to process

excellence.

What is Six Sigma...

Six Sigma has transformed some of the most

successful companies in the world

(Motorola, Allied Signal, GE).

Six Sigma is a target (Fewer than 3.4 defects

or errors per million opportunities 99.99966

perfection).

Six Sigma is an approach to aiming at that

target by changing the culture of a company.

It involves everyone in the company.

What is Six Sigma...

Six Sigma can be used to design in excellence and

then make continuous improvements.

Six Sigma is used to bring new products and services

to market (Define, Measure, Analyze, Design,
Validate) by methodically laying everything
out first.

Six Sigma identifies problems in a process, sets up

projects within the process, evaluates the process
and works through the projects (Define, Measure,
Analyze, Improve, Control) to improve the
process.

What is Six Sigma...

Sigma aims to raise customer
satisfaction by reducing the number of
defects in a process, thereby raising the
Sigma rating.

Six

Sigma is a culture which permeates

a company in the desire of all
staff to achieve targets, increase
customer satisfaction, lower costs and
improve profitability.

Six

GE Investments Vs. Returns

Million US$
$2,500
$2,000
$1,500
$1,000
Cumulative
figures

$500
1996

1997

1998

1999
estimate

1998 Annual Report General Electric Company

Investment
Savings

Six Sigma Sample Results

Company
General Electric
JP Morgan Chase

Annual Savings
$2.0+ billion
$1.5 billion

Texas Instruments
Johnson & Johnson
Honeywell

$600 million
$500 million
$600 million

Perfection

99.7%

99.9%

99.99966%

Incorrect drug prescriptions

54,000

4,000

1 every 25 years

1 second every
16 years

1 in 10 years at
all U.S. airports

1,350

500

1 in 20 years

10,000

3,000

10

54,000

4,000

4.3

4.6

each year
Unsafe drinking water;

hours per month

Missed landings each day at

Londons Heathrow airport

Incorrect surgical operations

per week
Newborn babies dropped by

doctors and nurses each year

Lost mail per hour

Sigma Level

Six Sigma Precepts

Customer and process focused

Focus is on the things that matter

Data driven decisions

Act on fact

Reduced variation in process performance

Variation is the enemy

Reduction in cycle time

Faster is usually better

Prevention of defects
Proactive not reactive

A new perspective of performance

99% is not good enough

10

Core Principles of Six

Sigma

Customer satisfaction

Profit improvement

Project-by-Project improvements

Prioritization of improvements

Process-driven approach to managing the business

DMADV / DMAIC

Near Perfection as a goal of performance

Teamwork draws on experience, knowledge and dedication

Recognition - expression of respect for employee contribution

11

The Six Sigma Difference

Assigns and trains improvement experts

Involves all/most organizational members

Targets significant and lasting improvements

Requires the use of proven statistical tools

Attacks the root cause of problems

Focuses on improvements that have

Provides a single measure to compare disparate processes

Pushes processes to achieve near-perfect quality levels

Six Sigma is a permanent long-term program

financial impact

12

Deployment Models: Is there a

right way?
There

is no one way to deploy Six

Sigma.
It

is very much dependent on the

culture of the organisation, Do you

take a top down or bottom up
approach??
13

The Classical( Proven) Approach

Company leadership decide to implement Six Sigma.

Business leaders attend a one day Six Sigma

Executive training session. This group should establish
a Six Sigma Leadership team with defined
responsibilities, identify key business issues , set
aggressive Six Sigma goals and establish
implementation and deployment guidelines.

14

The Classical( Proven) Approach

(cont)

A Six Sigma Senior Champion is appointed . This sends the

message that senior management are serious. Deployment
Champions are also appointed. These go through certified
champion training.

This group then develop the detailed deployment plan which

includes training plan , finance plan communication plan etc.

Projects and candidates are selected. A clustered or phased

deployment is then commenced.

15

Six Sigma Roles

Organisational Roles and Responsibilities
Project Team
Members

Executives
Own vision, direction,
integration, results
Lead change

Champions

Part-time
Project-specific

Green Belts

All employees

Project owner
Implement solutions
Black Belt managers

Master Black
Belts

Understand vision
Apply concepts

Part-time
Help Black Belts

Black Belts

Full time
Devote 50% - 100% of time to Black Belt activities
Train and coach
Facilitate and practice problem solving
Black and Green Belts
Train and coach Green Belts and project teams
Statistical problem solving experts
Recognise

Define

.
l

16

The Six Sigma Players

Customer
Green Belts
Black Belts
Master Black belts
Champions
Executive Leadership

17

The Six Sigma Players

Project Champions take their company's vision, missions,

goals, and metrics and translate them into individual unit
tasks. Additionally, Champions must remove any roadblocks to
the program's success.

Project Champions are involved in selecting projects and

identifying Black and Green Belt Candidates. They set
improvement targets, provide resources, and review the
projects on a regular basis so that they can transfer knowledge
gained throughout the organisation.

18

The
Six
Sigma
Players

Master black belt--

This is the highest level of technical and organisational

proficiency.
Because master black belts train black belts, they must
know everything the black belts know, as well as understand
the mathematical theory on which the statistical methods are
based.
Masters must be able to assist black belts in applying the
methods correctly in unusual situations.
Whenever possible, statistical training should be conducted
only by master black belts.
. Because of the nature of the master's duties,
communications and teaching skills should be judged as
important as technical competence in selecting candidates

19

The Six Sigma Players

Candidates for technical leader (black belt) status are technically oriented
individuals held in high regard by their peers.

They are the achievers

They should be actively involved in the organisational change and

development process.

Candidates may come from a wide range of disciplines and need not be
formally trained statisticians or engineers.

Six sigma technical leaders work to extract actionable knowledge from an

organisation's information warehouse.

Good computer skills

Probably more important that their technical skills is their people
management skills. Implementing change successfully demands the ability to
involve people and persuade the necessity for change.

20

The Six Sigma Players

Green Belts provide internal team support to Black
Belts. While they are not trained to the same depth of
knowledge as Black Belts, they are able to assist in data
collection, computer data input, analysis of data using
the software, and preparation of reports for management.
Typically, a Green Belt will be a respected worker who
can manage the team in the absence of the Black Belt.
Green Belts are part-time workers on a team and may
migrate to this position because of their skills using basic
quality analysis tools and methods and their ability to
facilitate team activities. Many become Black Belts over
time as they build a personal base of experience that
boosts them into a more technical role.

21

What are the key elements for

success
Clear

need, strategy, and goals (monetary)

for improvement
Management that is involved Procedures for
selecting strategic improvement projects.
Good improvement methodology
Dedicated and trained resources
Periodic reviews by various levels of
management
Communication of need and benefits
Recognition, reward, and celebration
22

Lessons learned to date

Management commitment has to be 100% . Dont

start until you get solid buy-in

Difficulty in getting Black Belt candidates released too busy. Managers would prefer to retain the
firefighters.

The first projects we choose were too big and

hence have taken too long.

Tailor the scope of the project to approx.. 3 to 4

months

The only way to answer Is this another fad !

brigade is to produce results.
23

Lessons learned to date

Six sigma can create a hierarchical class culture e.g.

Training Engineers to Greenbelt only status can be seen as
negative.
How to reward Blackbelts?
Having the organization prepared for the consequence of six
sigma e.g. a redundancy programme.

These are management challenges that can be faced

down. No deployment will 100% right first time .
The benefits we have had so far with six sigma far
outweigh any negatives.

SIX SIGMA WORKS!.

24

Six Sigma DMAIC Model

1.

IDENTIFY OPPORTUNITIES

2.

3.

FORM TEAM & SCOPE PROJECT

Identify Customers
and Requirements

Process Flow Analysis

Analyze Available
Data

SURVEY
YES NO

HISTORY
REPORT

Tree Diagram

Process Flow Analysis

DEFINE DESIRED OUTCOMES

FOR IMPROVED PROCESS

Define Performance
Measures

Benchmarking
Pareto Analysis

4.

ANALYZE CURRENT PROCESS

Establish Process
Boundaries

Agree on Goals

Check Sheet

GOAL

CHECK SHEET

C
D

9.

ACKNOWLEDGE TEAM AND

COMMUNICATE RESULTS

5.

IDENTIFY ROOT CAUSES & PROPOSED SOLUTIONS

Brainstorming

Process Redesign

TEAM RESULTS

REPORT

Why-Why
Diagram
Nominal Group Technique
Cause & Effect
Diagram
EFFECT

6.
RECYCLE IF NECESSARY

8.

MEASURE PROGRESS & HOLD

GAINS

7.

REFINE AND IMPLEMENT

SOLUTIONS

Brainstorming

Force Field Analysis

SPC

Level Loading

Design of
Experiments

PRODUCTION DAYS

1 2 3
C+

90.00
83.67

30

A
B

77.33

C-

71.00
64.67

Trend Chart

PRIORITIZE, PLAN AND TEST

PROPOSED SOLUTIONS

C-

C
D

58.33
52.00

C+
A-

GANTT Chart

Training & Procedures

A+

Pull System

PRIOR
OPERATION

NEXT
OPERATION

Phase
Define
Measure
Analyze
Improve
Control

Step(s)
1&2
3&4
5
6&7
8&9

25

Using Successive Projects for Cycle Time

and
Defect Reduction
t State)
As Is (Curren

Cycle Time and Defects

Hi

Low

Be
ShouAlsdIs)
(new

Could

est
B
(
e
B

Be
Shoulsd Is)
(new A
ss)
a
l
C
n
-i

Be
d
l
u
o
h
S
I s)
(new As

Time
26

DMAIC

Define
What is important?
Measure
How are we doing?
Analyze
What is wrong?
Improve
Fix whats wrong
Control
Ensure gains are maintained to
guarantee performance
27

Define

Identify our internal and external customers

Determine what our customers want

Identify our suppliers

Determine what we need from our suppliers

Identify problems

Identify the process that contributes to the problems

Identify improvement opportunities

Scope the improvement project

Select the right players

Set goals and objectives

28

Measure

Review the current process

Identify key inputs and outputs

Develop baseline and entitlement metrics

Performance
Cost

Collect and organize data

Evaluate the performance of the process

Defects
Cycle time

Assess the amount of variation

In the process
In the measurement system
29

Analyze

Identify issues that occur at each step in the

process

Assess customer impact of problems

Prioritize most critical inputs

Assess the effect on outputs or performance

Determine root causes

Generate solutions

Select most likely solutions

30

Improve

Develop Action Items

Prioritize improvements

Test solutions

Determine best combination of inputs and

controls

Refine solutions

Document solutions

Implement solutions
31

Control

Measure progress

Capture and quantify benefits of the process

improvements

Document the project

Communicate for organizational learning

Recognize the teams efforts and success

Monitor and manage to hold gains

Adjust for continuous improvement

32

Tools & Templates by DMAIC

Phase
Tool
Action Item/Implementation Plan
Affinity Diagram
Brainstorming
Business Impact (ABM)
Cause & Effect Matrix
Check Sheet
Control/Reaction Plan
Control Chart
Cycle Time Analysis
Design of Experiment (DOE)
Decision Matrix
DPMO to Sigma Conversion Table
Five Whys
Failure Mode and Effects Analysis (FMEA)
Force Field Analysis
Four Up
Histogram

Define Measure Analyze Improve Control

X
X
X

X
X

X
X

X
X
X
X

X
X

X
X
X

X
X
X

X
X

X
X

Note: The relationship between the specific tool and the DMAIC phase is based on most likely usage as opposed to possible usage.

33

Tools & Templates by DMAIC

Phase continued
Tool

Define Measure Analyze Improve Control

Ishikawa (Fishbone)
Measurement System Evaluation (MSE)
Multivoting
Pareto Chart
Process Capability
Process Costing Tool
Process Maps
Problem Statement/Critical Business Issue (CBI)
Requirements Analysis
Run Chart
Scatter Diagram
Sigma Calculator
SIPOC Chart
Story Board
SWOT Analysis
Team Charter
Thought Process Map

X
X
X
X
X

X
X
X
X
X
X
X
X

X
X
X
X

X
X
X

Note: The relationship between the specific tool and the DMAIC phase is based on most likely usage as opposed to possible usage.

34

Project Quality
Management

What Is Project Quality

Management?
Project

quality management ensures that the project

will satisfy the needs for which it was undertaken.
Processes include:
Quality planning: Identifying which quality standards are
relevant to the project and how to satisfy them.
Quality assurance: Periodically evaluating overall project
performance to ensure the project will satisfy the relevant
quality standards.
Quality control: Monitoring specific project results to ensure
that they comply with the relevant quality standards.

36

Scope Aspects of Projects

Functionality is the degree to which a system performs

its intended function.
Features are the systems special characteristics that
appeal to users.
System outputs are the screens and reports the system
generates.
Performance addresses how well a product or service
performs the customers intended use.
Reliability is the ability of a product or service to perform
as expected under normal conditions.
Maintainability addresses the ease of performing
maintenance on a product.
37

Whos Responsible for the Quality

of Projects?

Project managers are ultimately responsible

for quality management on their projects.

Several organizations and references can

help project managers and their teams
understand quality.
International Organization for Standardization
(www.iso.org)
IEEE (www.ieee.org)

38

Quality Assurance

Quality assurance includes all the activities related to

satisfying the relevant quality standards for a project.

Another goal of quality assurance is continuous

quality improvement.

Benchmarking generates ideas for quality

improvements by comparing specific project practices
or product characteristics to those of other projects or
products within or outside the performing
organization.

A quality audit is a structured review of specific

quality management activities that help identify
lessons learned that could improve performance on
current or future projects.
39

Table of Contents for a Quality

Assurance Plan*
1.0 Draft Quality Assurance Plan
1.1 Introduction
1.2 Purpose
1.3 Policy Statement
1.4 Scope
2.0 Management
2.1 Organizational Structure
2.2 Roles and Responsibilities
2.2.1 Technical Monitor/Senior
Management
2.2.2 Task Leader
2.2.3 Quality Assurance Team
2.2.4 Technical Staff
3.0 Required Documentation

4.0 Quality Assurance Procedures

4.1 Walkthrough Procedure
4.2 Review Process
4.2.1 Review Procedures
4.3 Audit Process
4.3.1 Audit Procedures
4.4 Evaluation Process
4.5 Process Improvement
5.0 Problem Reporting Procedures
5.1 Noncompliance Reporting Procedures
6.0 Quality Assurance Metrics
Appendix
Quality Assurance Checklist Forms

*U.S. Department of Energy

40

Quality Control
The

main outputs of quality control are:

Acceptance decisions
Rework
Process adjustments
Some

tools and techniques include:

Pareto analysis
Statistical sampling
Six Sigma
Quality control charts
41

Pareto Analysis

Pareto analysis involves identifying the vital few

contributors that account for the most quality
problems in a system.

Also called the 80-20 rule, meaning that 80

percent of problems are often due to 20 percent
of the causes.

Pareto diagrams are histograms, or column

charts representing a frequency distribution, that
help identify and prioritize problem areas.
42

Sample Pareto Diagram

43

Six Sigma Projects Use

Project Management

The training for Six Sigma includes many project

management concepts, tools, and techniques.

For example, Six Sigma projects often use

business cases, project charters, schedules,
budgets, and so on.

Six Sigma projects are done in teams; the project

manager is often called the team leader, and the
sponsor is called the champion.
44

Quality Control Charts and the

Seven Run Rule

A control chart is a graphic display of data that

illustrates the results of a process over time. It
helps prevent defects and allows you to
determine whether a process is in control or out of
control.

The seven run rule states that if seven data points

in a row are all below the mean, above the mean,
or are all increasing or decreasing, then the
process needs to be examined for non-random
problems.
45

Six 9s of Quality

Six 9s of quality is a measure of quality control

equal to 1 fault in 1 million opportunities.

In the telecommunications industry, it means

99.9999 percent service availability or 30 seconds
of down time a year.

This level of quality has also been stated as the

target goal for the number of errors in a
communications circuit, system failures, or errors
in lines of code.
46

The Seven Run Rule

You

can use quality control charts and the

seven run rule to look for patterns in data.

The

seven run rule states that if seven

data points in a row are all below the
mean, above the mean, or are all
increasing or decreasing, then the
process needs to be examined for nonrandom problems.
47

Sample Quality Control Chart

48

Testing

Many IT professionals think of testing as a

stage that comes near the end of IT product
development.

Testing should be done during almost every

phase of the IT product development life
cycle.

49

Types of Tests

Unit testing tests each individual component (often a

program) to ensure it is as defect-free as possible.

Integration testing occurs between unit and system

testing to test functionally grouped components.

System testing tests the entire system as one entity.

User acceptance testing is an independent test

performed by end users prior to accepting the
delivered system.

50

Modern Quality
Management

Modern quality management:

Requires customer satisfaction.
Prefers prevention to inspection.
Recognizes management responsibility for quality.

Noteworthy quality experts include Deming,

Juran, Crosby, Ishikawa, Taguchi, and
Feigenbaum.

51

Improving Project Quality

Several suggestions for improving quality projects

include:
Establish leadership that promotes quality.
Understand the cost of quality.
Focus on organizational influences and workplace factors
that affect quality.
Follow maturity models.

52

Leadership

As Joseph M. Juran said in 1945, It is most

important that top management be quality-minded.
In the absence of sincere manifestation of interest
at the top, little will happen below.*

A large percentage of quality problems are

associated with management, not technical
issues.
*American Society for Quality (ASQ), (www.asqc.org/about/history/juran.html).

53

Expectations and Cultural

Differences in Quality

Project managers must understand and manage

stakeholder expectations.

Expectations also vary by:

Organizations culture
Geographic regions

54

Using Software to Assist in Project

Quality Management

Spreadsheet and charting software helps create

Pareto diagrams, fishbone diagrams, and so on.

Statistical software packages help perform

statistical analysis.

Specialized software products help manage Six

Sigma projects or create quality control charts.

Project management software helps create Gantt

charts and other tools to help plan and track work
related to quality management.
55