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Six Sigma

Six Sigma. Focus Group Meeting Dr K. M. Madrecha Projects & Quality Manager The Kanoo Group – UAE & Oman & Consultative Committee Member Supply Chain & Logistics Group. Quality History in the Industrial World. 1787 - Concept of Interchangeability introduced.

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Six Sigma

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  1. Six Sigma Focus Group Meeting Dr K. M. Madrecha Projects & Quality Manager The Kanoo Group – UAE & Oman & Consultative Committee Member Supply Chain & Logistics Group

  2. Quality History in the Industrial World • 1787 - Concept of Interchangeability introduced. • 1870 - Concept of tolerance • 1900 - Concept of standardization • 1930 - National standardization organisations • 1901 UK, • 1920 Belgium, Canada, France, US…etc. • 1930s Most of the industrial countries • 1920s-30s Development of SQC and SPC in Bell Labs and Western Electric • 1924 Walter Shewhart developed Control Charts • Herold Dodge & Harry Romig developed sampling techniques. • 1940s - Deming applied sampling and control chart techniques in computer operations in US Census. • 1950s- Deming’s thinking reaches Japan

  3. Quality History in the Industrial World • 1970-80s - TQM movement takes hold, national Quality Awards established • 1987 - ISO 9000 family of standards published. • 1994 - First revision of ISO 9000 standards. • 1996 - ISO 14001 published • Early 1990s Business Process Re-engineering movement became popular • 1995-2000 - Development of the Internet, e-business • 2000 - Major revision of ISO 9000 standards

  4. Build Up of Quality in Japanese Industry (L.P.Sullivan, “The Seven Stages in Company-Wide Quality Control”, Quality Progress, May 1986 p 77, ASQC) 100% 7: Customer Oriented (1990s) (QFD, deploying voice of the customer in operational terms) 6: Cost Oriented (1970s-80s) (Product and process designing for robustness based on DOE) CWQC 5: Society Oriented (1950s-60s) (Product and process designing based on DOE) 4: Humanistic (Education and Training to all employees) 40% 3: System Oriented (Quality Management Systems covering all departments, ie. Design, manufacturing, sales & service) TQC 2: Process Oriented (1950s) (QA during production processes including SPC and fool proofing) 1: Product Oriented (Upto 1940s) (Inspection after production, audits of finished products and problem solving activities) 0%

  5. The Kaizen View Change required Maintenance Innovation without Kaizen Natural deterioration Change required Kaizen Kaizen + Innovation Time (Adopted from Masaki Imai (1991), McGraw -Hill, pp 26-27)

  6. Six Sigma

  7. What is Six Sigma? • A statistical measure for determining process capability (Six Sigma equates to 3.4 defects/million opportunities) • A proven set of tools and tactics for reducing variation • A successful business strategy (used by Motorola, Texas Instruments and Allied Signal) • A comprehensive philosophy about operational excellence • A disciplined process for identifying sources of variation / defects in a process; minimizing or eliminating that variation or those defects; and ensuring improvements stay in place. Six Sigma is a Proven, Data-Driven Method for Improving Processes

  8. Lack of integration with business strategy Leadership apathy A fuzzy concept Unclear goals Too technical approach Failure to break bureaucracy Emphasis on incremental change Ineffective training Focus on technical processes (production, design) Links to the business and personal “bottom line” “Leadership” leadership A “branded” concept Clearly identified “status” “Glamour” oriented approach Populist form Equal emphasis on incremental and radical change “Branded” training Improvement in all processes TQM vs Six Sigma TQM Six Sigma

  9. BPR vs Six Sigma BPR Six Sigma • Too radical to digest • Traumatic • Anti-people • In practice internal cost focus • Participatory, people oriented • Enhances personal esteem of employees • Radical changes achievable • Customer focus BPR Six Sigma TQM

  10. The Challenge: Do it with Speed Implementing Change Change Initiative Focused On Customer Needs (Target) QUALITY (Technical Strategy) ACCEPTANCE (Cultural Strategy)

  11. Six Sigma Roadmap • Identify Core Processes and Key Customers • Define Customer Requirements (CTQs) • Measure Current Performance • Prioritise, analyse and implement improvements • Expand and integrate

  12. Min = 17 Max = 118 53 Capture What The Customer Sees - The Entire Distribution Of Y Values Understanding the Output 17 42 61 58 79 32 57 118 42 48 49 58 62 86 58 46 76 86 104 29 59 45 69 47 67 56 66 55 25 43 53 Jan CUSTOMER’S VIEW Time (days) Feb GE’s VIEW Mar Average

  13. SIPOC • Supplier • Input • Process • Output • Customer

  14. Five Phase Improvement Process (DMAIC) A Rigorous, Customer-Focused Improvement Process Define Measure Analyze Improve Control 1. What is important to the customers? (survey / interview / inquiries) 2. What is the frequency of defects? (measurement system / process mapping / sigma rating) 3. When, where and why do defects occur? (statistics / pareto / FMEA / benchmarking / etc...) 4. How can we improve the process? (design of experiments / expert brainstorming / etc...) 5. How can we maintain the process improvement? (measurement feedback control / procedural / etc...)

  15. Definitions What Is Six Sigma? • CustomerAnyone Who ReceivesProduct, Service or Information • OpportunityEvery Chance to Do Something Either “Right” or “Wrong” • Successes vs. DefectsEvery Result of an Opportunity Either Meets the Customer Specification or it Doesn’t GE Company Proprietary November 1998

  16. The Six Sigma Goal Why 99% Isn’t Good Enough • 20,000 pieces mail lost per hour • Unsafe drinking water almost 15 minutes out of each day • 2 short or long landings at most major airports each day • No electricity for almost 7 hours each month 99% Isn’t Good Enough! “99% Good” Defects s % Good 2 308,537 68% 3 66,807 93% 4 6,210 99% 5 99.99% 233 6 99.9997% 3.4

  17. X X X X X X X X X X X X X X X X X X X X X X X X X X X X The Objective of Six Sigmais to Identify & Reduce Variation Bull’s Eye Off-Center Too Much Spread X X X X X X X X X X X X Centered On-Target X X Center Process Reduce Spread

  18. Process Philosophy T What Is Six Sigma? ? • Know What’s Importantto the Customer (CTQ) • Reduce Defects (DPMO) • Centre Around Target (Mean) • Reduce Variation (Standard Deviation) GE Company Proprietary November 1998

  19. Defects Reduced Variation Results in Fewer Defects & Higher Process Yields With Normal Curves... Off-Centre Too Much Spread Target Target LSL USL LSL USL Centred On-Target Target Center Process Reduce Spread LSL USL

  20. The Six Sigma Journey Six Sigma Quality at GE Lynn Fergusson Manager, Corporate Initiatives GE Canada

  21. Intensity of Change * New Product Introduction Quick Market Intelligence Order to Remittance Supplier Partnership Work-Outä: Stages of GE's Culture Change high Six Sigma Quality Key Strategic Initiatives: QMI*, NPI*, OTR*, SP*, Productivity, Globalization Change Acceleration Process: increase success and accelerate change Process Improvement: Bullet Train Approach continuous improvement, re-engineering Productivity / Best Practices: Best Practice Sharing looking outside GE Work-Outä / Town Meetings: Action Work-Outsä Customized Work-Outsä low empowerment, bureaucracy busting, action Time r 6/3/96

  22. From Our CEO... • “...this Six Sigma journey will change the paradigm from fixing products so they are perfect to fixing processes so that they produce nothing but perfection, or close to it.” -Jack Welch

  23. All Employees Involved Key Six Sigma Roles Champion Senior management with clout and credibility responsible for the success of the Quality initiative Master Black Belt Teachers, Trainers, Reviewers and Mentors of Black Belts (Full Time) Black Belt Leaders of the teams that conduct Six Sigma projects (Full Time) Green Belt Six Sigma project leaders (Part Time) Key participants in Black Belt projects gathering data and implementing process improvements Team Members

  24. Six Sigma Organisation Master Black Belts (Coach, support project leaders) Sponsors/ Champions (Recognise people, maintain momentum/morale) (Select, Oversee, guide projects) Green Belts/ Team Leaders (Lead projects to success) Black Belts (Lead projects to success) GBs/Team members (Suggest projects, Analyse/experiment, implement solutions)

  25. Trained GE Employees 100% 100% 90% 100% Six SigmaTrained 80% 60% 60% 40% Green Belts 15% 20% MBB’s & BB’s 0% 1996 1997 1998 1999 2000 Explosive Growth In Green Belts And Six Sigma Trained Employees Training All Professional Employees GB Trained By Early 1999

  26. Projects Completed Projects Will Reach 55,000 by 2000 20,000 More Projects in 98 1997 1998 1999 2000 Project Completion Drives Six Sigma Learning

  27. Benefit/ Cost Ratio 1996 0.9 1997 1.8 1998 ~2.5 1999 ~5 Six Sigma Costs and Benefits ($ Millions) Future Benefits Include Emphasis on Customer Impact

  28. Further Quality Initiatives at GE • Six Sigma @ the Customer– emphasis on becoming more customer centric; BBs at customer sites to help customers improve their processes and for GE to gain better insights about our customers • Six Sigma Customer Centric Metrics– communicate customer metrics to employees on an on-going basis along with how our processes are impacting the customer’s metrics • Six Sigma in GE’s Fulfillment Process– focus on common metrics, measure the same way with emphasis on optimizing process against customer requests • Six Sigma in e-Business– focus on understanding e-Business and e-Commerce capabilities

  29. Six Sigma Must Become Part of the Culture In Summary... The Keys to A Successful Six Sigma Strategy Include: • Customer- Focus on the Customer • Process - Look at the Process from the Customers’ Perspective - “Outside-In Thinking” • Employees- Leadership Commitment

  30. Example of Six Sigma in KM • Quotation Timeliness in KM @ 2.95 sigma, DPMO = 73,873 • Delivery Timeliness in KM is @ 2.38 sigma, DPMO= 189,801 • (* Period May-August, 2001)

  31. The Way Forward? • ……………………………………………….. • ………………………………………………..

  32. Thank You!

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