1. Principles of Six Sigma
Chapter 10
Principles of
Six Sigma
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

2. Key Idea
Although we view quality improvement tools and techniques from the perspective of Six Sigma, it is important to understand that they are simply a collection of methods that have been used successfully in all types of quality management and improvement initiatives, from generic TQM efforts, to ISO 9000, and in Baldrige processes.
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

3. Six-Sigma Metrics
Defect – any mistake or error that is passed on to a customer
Defects per unit (DPU) = number of defects discovered  number of units produced
Defects per million opportunities (dpmo) = DPU  1,000,000  opportunities for error
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

4. Six-Sigma Quality
Ensuring that process variation is half the design tolerance (Cp = 2.0) while allowing the mean to shift as much as 1.5 standard deviations, resulting in at most 3.4 dpmo.
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

5. Key Idea
Although originally developed for manufacturing in the context of tolerance-based specifications, the Six Sigma concept has been operationalized to apply to any process and has come to signify a generic quality level of at most 3.4 defects per million opportunities.
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

6. k-Sigma Quality Levels
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

7. Problem Solving
Problem: any deviation between what “should be” and what “is” that is important enough to need correcting
Structured
Semistructured
Ill-structured
Problem Solving: the activity associated with changing the state of what “is” to what “should be”

8. Quality Problem Types Conformance problems
Unstructured performance problems
Efficiency problems
Product design problems
Process design problems
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

9. Key Factors in Six Sigma Project Selection
Financial return, as measured by costs associated with quality and process performance, and impacts on revenues and market share
Impacts on customers and organizational effectiveness
Probability of success
Impact on employees
Fit to strategy and competitive advantage
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

10. Problem Solving Process
Redefining and analyzing the problem
Generating ideas
Evaluating and selecting ideas
Implementing ideas
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

11. Key Idea
A structured problem-solving process provides all employees with a common language and a set of tools to communicate with each other, particularly as members of cross-functional teams.
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

12. DMAIC Methodology DMAIC Define Measure Analyze Improve Control
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

13. Common Six Sigma Tools
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

14. Define Describe the problem in operational terms
Drill down to a specific problem statement (project scoping)
Identify customers and CTQs, performance metrics, and cost/revenue implications
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

15. Measure Key data collection questions
What questions are we trying to answer?
What type of data will we need to answer the question?
Where can we find the data?
Who can provide the data?
How can we collect the data with minimum effort and with minimum chance of error?
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

16. Analyze Focus on why defects, errors, or excessive variation occur
Seek the root cause
5-Why technique
Experimentation and verification
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

17. Improve Idea generation Brainstorming Evaluation and selection
Implementation planning
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

18. Control Maintain improvements Standard operating procedures Training
Checklist or reviews
Statistical process control charts
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

19. Tools for Six-Sigma and Quality Improvement
Elementary statistics
Advanced statistics
Product design and reliability
Measurement
Process control
Process improvement
Implementation and teamwork
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

20. Design for Six Sigma
Focus on optimizing product and process performance
Features
A high-level architectural view of the design
Use of CTQs with well-defined technical requirements
Application of statistical modeling and simulation approaches
Predicting defects, avoiding defects, and performance prediction using analysis methods
Examining the full range of product performance using variation analysis of subsystems and components
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

21. Key Idea
All Six Sigma projects have three key characteristics: a problem to be solved, a process in which the problem exists, and one or more measures that quantify the gap to be closed and can be used to monitor progress.
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

22. Key Six Sigma Metrics in Services
Accuracy
Cycle time
Cost
Customer satisfaction
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

23. Lean Production and Six Sigma
The 5S’s: seiri (sort), seiton (set in order), seiso (shine), seiketsu (standardize), and shitsuke (sustain).
Visual controls
Efficient layout and standardized work
Pull production
Single minute exchange of dies (SMED)
Total productive maintenance
Source inspection
Continuous improvement
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

24. Traditional Economic Model of Quality of Conformance
Total cost
Cost due to nonconformance
Cost of quality assurance
100%
“optimal level” of quality
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

25. Modern Economic Model of Quality of Conformance
Total cost
Cost due to nonconformance
Cost of quality assurance
100%
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing