1. Six Sigma Introduction Supply Chain Leadership Committee
Nashville, TN
November 4, 2005
Steve Freudenthal
Milliken & Company

2. Six Sigma Introduction
Six Sigma Definition
Evolution of Six Sigma
The Six Sigma Process Today
The DMAIC Process
Consultant Selection

3. Key Principles of Six Sigma at Xerox
ØEverything starts with the customer. 
ØThe infrastructure for cultural change is the most powerful contribution of Six Sigma. 
ØDecisions about which projects to pursue must be based at least in part on the potential impact on net present value. 
ØSustained improvement is possible only with management engagement. 
ØCEO goals are translated to frontline projects and coordinated through an organization of people and technical resources. 
ØA standard problem-solving process and associated tool set provides the means for basing decisions on data.

4. Quality Initiatives ? Six Sigma Quality Lean Manufacturing
Statistical Quality Control
Continuous Improvement/Kaizen
Malcolm Baldrige National Quality Award
Total Productive Maintenance
Supply Chain Management
Quality Circles
ISO 9000 Standards
Reengineering
Theory of Constraints
Lean Manufacturing
Six Sigma Quality ?
ISO 9000:2000

5. What does “Six Sigma” mean?
Phase I
Early 1980’s
Pioneered at Motorola
Statistical approach
Measured DPMO
Variation is the enemy
Focused on:
Elimination of defects
Improving product and service quality
Reducing cost
Continuous process improvement

6. What does “Six Sigma” mean?
Phase II
Mid 1990’s
Revised by Jack Welch at General Electric
Linked Six Sigma to business strategy and customer needs
Strong measurement on bringing dollars to the bottom line
Strong financial community involvement
Project driven
High potentials selected to be Black Belts
Black Belts expected to deliver $250,000/year to bottom line (hard dollars)
Black Belts promoted up after two years
All senior leaders trained (Green Belt)
Projects are sponsored by business leadership (Top Down)
2% of management committed full-time

7. What does “Six Sigma” mean?
Phase III
2000’s
Lean Six Sigma
Caterpillar, Xerox, DuPont
Combined lean manufacturing techniques and Six Sigma
Benefit: High speed, low cost

8. Six Sigma Savings Averages by Area
$500K
$480K
$450K
$180K
$100K
$35K

9. Roles and Responsibility
Deployment
Manager
Champions/
Sponsors
Black Belts
Master Black Belts
Green Belts
Identification and Prioritization of Projects by Division
Assign and Review Activities of Black Belts
Facilitate Project Implementation
Key Stakeholder in Project Success
Lead 4-6 strategic improvement projects each year
Expert in Six Sigma techniques
Help local organization in Six Sigma disciplines
Full-Time Position
Mentor/coach Black Belts
Teach Six Sigma techniques
Full-time Corporate Position
Domain Experts
20-30% on one Project

10. Six Sigma Project Prioritize/ Select Scoring Rules
Johnson Controls Inc.
Six Sigma Project Prioritize/ Select Scoring Rules
Score
$ Savings
(Hard/Annual
Time
(Duration)
Effort
(# people & $; Expense $; Cap $)
Success factor
(1 – risk) 9
>$250 K
(High)
< 4 months
(short)
< 3
(Small)
High
No capital; No IT; No Suppliers
Small work group affected; Short Duration; Small Project Team 7
$100 – $250 K
(Moderate)
4 - 8 months
(moderate)
4 – 6
Moderate
No capital; No IT; Some Suppliers
Multiple work groups affected;
Moderate Duration; Small Project Team 3
$50 - $100 K
(Okay)
8 – 12 months
(long)
6 – 10
(large)
Small
Some capital; Some IT;
Numerous Suppliers; Many work groups;
Long Duration; Moderate Project Team Size 1
<$50K
> 12 months
(very long)
> 10
(very large)
Low
Significant capital; Significant IT;
Very many Suppliers Very Many work groups
Very Long Duration; Large Project Team Size
Example
Total Score
Project A 9 7 3 22
$300 K
7 months
8 person team
Some capital, some IT, many work groups affected, moderate duration
Project B 30
$ 75K
4 months
2 person team
No capital, no IT, small project team

11. Prioritized by Management Team
Improvements Start with High Value Projects
Customer Issues / Opportunities
Business Strategy
Goals / Objectives
Priorities
Project Selection
Structured Process
Links Business Strategy & Priorities
Led by Deployment Managers
Based on Benefit / Effort Analysis
Leadership Accountable for Prioritization
Project
Candidates
Prioritized by Management Team
Structured approach to project selection
Low Med High
BENEFIT
EFFORT
Low Med High
Xerox

12. Six Sigma Improvement Model
“DMAIC” Process
Define – describe the process,
problem, opportunity
Measure – gather data
Analyze – listen to the data
Improve – develop solutions,
design processes
Control – plan for stability

13. Six Sigma Design Model “DMADV” Process Define – describe the process,
problem, opportunity
Measure – gather data
Analyze – listen to the data
Develop – create the solution
Verify – does the solution work?

14. Potential Tools and Techniques
Define
1.0
Define Opportunities
2.0
Measure Performance
3.0
Analyze Opportunity
4.0
Improve
Performance
5.0
Control
Performance
Main Activities
Potential Tools and Techniques
Objective
Validate/ Identify Business Opportunity
Validate/ Develop Team Charter
Identify and Map Processes
Identify Quick Win and Refine Process
Translate VOC
Develop Team Guidelines & Ground Rules
Sigma Goal (CCR)
Gap
To identify and/or validate the improvement opportunity, develop the business processes, define critical customer requirements, and prepare themselves to be an effective project team.
Project Focus $$
CCRs
TASKS
ACTIVITIES
RESP.
START
DUE
STATUS &ACTIONS
Action Plan
Business Case
Goal Statement
Project Plan
Opportunity Statement
Project Scope
Team Selection
Team Charter

15. , but Not Sufficient Tools* are Essential Xerox Define Measure Analyze
Value Stream Map
Various Financial Analysis
Charter Form
Multi-Generational Plan
Stakeholder Analysis
Communication Plan
SIPOC Map
High-Level Process Map
Non-Value Added Analysis
VOC and Kano Analysis
Lean Quality Function Deploy-ment (QFD)
RACI & Quad Charts
Define
Measure
Operational Definitions
Data Collection Plan
Pareto Chart
Histogram
Box Plot
Statistical Sampling
Measurement System Analysis
Setup Reduction
Generic Pull
Kaizen
Control Charts
Process Capability, Cp & Cpk
Analyze
Pareto Charts
C&E Matrix
Fishbone Diagrams
Brainstorming
Detailed ‘As-Is’ Process Maps
Basic Statistical Tools
SupplyChainAccelerator Analysis
Non Value-Added Analysis
Hypothesis Testing
Confidence Intervals
FMEA
Simple & Multiple Regression
ANOVA
Queuing Therory
Analytical Batch Size
Improve
Brainstorming
Benchmarking
Process Improvement Techniques
Line Balancing
Process Flow Improvement
Constraint Identification
Replenishment Pull
Sales & Operations Planning
Poka-Yoke
FMEA
Solution Selection Matrix
‘To-Be’ Process Maps
Piloting and Simulation
Control
Control Charts
Standard Operating Procedures (SOP’s)
Training Plan
Communication Plan
Implementation Plan
Visual Process Control
Mistake-Proofing
Process Control Plans
Project Commissioning
Project Replication
Plan-Do-Check-Act Cycle
* Tool array adapted from Lean Six Sigma for Service by Michael George
Xerox

16. Potential Tools and Techniques
Measure
2.0
Measure Performance
1.0
Define
Opportunities
3.0
Analyze Opportunity
4.0
Improve
Performance
5.0
Control
Performance
Objective
Main Activities
Potential Tools and Techniques
To identify critical measures that are necessary to evaluate the success, meeting critical customer requirements and begin developing a methodology to effectively collect data to measure process performance.
To understand the elements of the six sigma calculation and establish baseline sigma for the processes the team is analyzing.
Identify Input, Process, and Output Indicators
Develop Operational Definition & Measurement Plan
Plot and Analyze Data
Determine if Special Cause Exists
Determine Sigma Performance
Collect Other Baseline Performance Data
Checksheets
Input
Process
Output
CCR
Process Indicator
Output Indicator
Input Indicator
UCL
LCL
Sigma= X
CCR
Gap
Sigma= X

17. Potential Tools and Techniques
Analyze
3.0
Analyze Opportunity
1.0
Define
Opportunities
2.0
Measure Performance
4.0
Improve
Performance
5.0
Control
Performance
Objective
Main Activities
Potential Tools and Techniques
To stratify and analyze the opportunity to identify a specific problem and define an easily understood problem statement.
To identify and validate the root causes that assure the elimination of “real” root causes and thus the problem the team is focused on.
To determine true sources of variation and potential failure modes that lead to customer dissatisfaction.
Stratify Process
Stratify Data & Identify Specific Problem
Develop Problem Statement
Identify Root Causes
Design Root Cause Verification Analysis
Validate Root Causes
Comparative Analysis
Sources of Variation Studies
Failure Modes & Effects Analysis
Regression Analysis
Process Control
Process Capability
Design of Experiments
Problem Statement
Quantified Root Causes
25%
50%
Indicators & Problem Statement (effect)

18. Potential Tools and Techniques
4.0 Improve Performance
4.0
Improve
Performance
1.0
Define
Opportunities
2.0
Measure Performance
3.0
Analyze
Opportunity
5.0
Control
Performance
Objective
Main Activities
Potential Tools and Techniques
To identify, evaluate, and select the right improvement solutions. To develop a change management approach to assist the organization in adapting to the changes introduced through solution implementation.
Response Surface Methods
Generate Solution Ideas
Determine Solution Impacts: Benefits
Evaluate and Select Solutions
Develop Process Maps & High Level Plan
Develop and Present Storyboard
Communicate Solutions to all Stakeholders

19. Potential Tools and Techniques
Control
5.0
Control
Performance
1.0
Define
Opportunities
2.0
Measure Performance
3.0
Analyze
Opportunity
4.0
Improve
Performance
Objective
Potential Tools and Techniques
Main Activities
To understand the importance of planning and executing against the plan and determine the approach to be taken to assure achievement of the targeted results. To understand how to disseminate lessons learned, identify replication and standardization opportunities/ processes, and develop related plans.
Error Modes and Effects Analysis
Process Control System
Develop Pilot Plan & Pilot Solution
Verify Reduction in Root Cause Sigma Improvement Resulted from Solution
Identify if Additional Solutions are Necessary to Achieve Goal
Identify and Develop Replication & Standardization Opportunities
Integrate and Manage Solutions in Daily Work Processes
Integrate Lessons Learned
Identify Teams Next Steps & Plans for Remaining Opportunities
Implemented Solution
Project Workplan
Sigma Goal (CCR)
Gap
CCR
CCR
Gap X

20. Six Sigma DMAIC Projects
5.0
Control
Performance
1.0
Define
Opportunities
2.0
Measure Performance
3.0
Analyze
Opportunity
4.0
Improve
Performance
5.0
Control
Performance
5.0
Control
Performance
1.0
Define
Opportunities
2.0
Measure Performance
3.0
Analyze
Opportunity
4.0
Improve
Performance
5.0
Control
Performance
Process cannot be improved:
Abort project
Recharter as Design Project

21. “ENERGY & WILL” Room to Inject New Energy Build on Energy
Manufacturing Performance is here
Deployed
Fully
Room to
Inject New
Energy D E P L O Y M N T
No Major
Gaps
Business Processes are here
Build on
Energy
Deployed
Well
Major
Gaps
Nothing
Nothing
Buzz (10+)
Push (5)
Skeptics (50%)
Pilots are Positive (80%)
Some Momentum
Balance of Push/Pull
Not at Tipping Point
More Pull Than Push
Internal & External
Positioning
Past the Tipping Point
Thriving
PULL!
Drives the Way
We Work
Ubiquitous
“ENERGY & WILL”

22. Key Learnings
50% of all companies attempting to implement Six Sigma failed after the first two years of implementation.

23. Long Term Goal – Sustained Commitment & Results
Key factors differentiating “A” curve from “F” curve
Sustained Commitment C A
Business integration into “how we work”
Project selection link to business strategies
Project selection link to Customer Value
Ability to change Culture & Leadership Behavior
Full Value-Chain engagement
Ability to track results
Integrating DfLSS
Six Sigma Net Business Benefit F
As many as 50% end up here at “F” 1 2 3 4
Year
Initial Leadership
Commitment *
* Chart adapted from Strategic Six Sigma: Best Practices from the Executive Suite by Dick Smith and Jerry Blakeslee
Xerox

24. Reasons Six Sigma Deployments Fail
Apathy from senior leadership
Training not connected to projects
Projects not connected to strategy
Projects only focused internally
Selecting “available” people
Part time Black Belts
No financial validation to bottom line
People not recognized for their
contributions

25. A Six Sigma Deployment Cannot Be Done
Without Consultants
Training Materials
Testing Materials
Professional Educators
Six Sigma Project Management Expertise
(Master Black Belts)
Credibility With Top Management
Can “Jump Start” The Deployment

26. on a company’s culture and how it aligns itself with its customers
If properly driven by Top Management, Six Sigma can have a dramatic impact
on a company’s culture and how it aligns
itself with its customers

27. Thank
You!!