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Six Sigma - A Breakthrough Strategy

Six Sigma - A Breakthrough Strategy. Competitive Edg e Management Consultants. Visible and hidden costs. Visible costs. Scrap Rework Warranty. Hidden Costs. Conversion efficiency of materials. Inadequate resource utilization. Excessive use of material.

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Six Sigma - A Breakthrough Strategy

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  1. Six Sigma - A Breakthrough Strategy Competitive Edge Management Consultants

  2. Visible and hidden costs Visible costs • Scrap • Rework • Warranty Hidden Costs • Conversion efficiency of materials • Inadequate resource utilization • Excessive use of material • Cost of redesign and re-inspection • Cost of resolving customer problems • Lost customers / Goodwill • High inventory

  3. The Six Sigma roadmap- Breakthrough strategy Stage Phase Objective Identify key business issues Define Identification Understand current performance levels Measure Analyze Characterization BREAKTHROUGH STRATEGY Improve Control Achieve breakthrough improvement Optimization Integrate Six Sigma in day to day functioning. Standardize Institutionalization

  4. Picturization of accuracy & precision Accurate and Precision • Accuracy & precision of a process can be best explained by using the analogy of a rifle firing at a target.

  5. Accurate and precise +

  6. Material • Assemblies • Components • Suppliers • Consumables • Methods • Procedures • Policies • Accounting • Environment • Noise level • Humidity • Temperature • Lighting Variation • People • Training • Experience • Skill • Attitude • Machine • Technology • Variability • Tooling • Fixtures • Measurement • Counting • Instruments • Gauging • Tests Sources of variation

  7. Cost of quality at various levels of Sigma Sigma Defect rate(PPM) Cost of quality Competitive level 6 3.4 <10% World Class 233 10-15% 5 15-20% 4 6210 Industry Average 20-30% 3 66807 30-40% 2 308537 Non Competitive >40% 1 6,90000

  8. Six Sigma business improvement mechanism Suppliers Inputs Business Process Process Outputs Critical Customer Requirements Defects Variation in output of processes causes defects

  9. 3 Sigma Vs 6 Sigma 6 Sigma curve LSL USL 3 Sigma curve 1 3 4 5 6 8 9 10 11 12 13 14 15 16 2 7 In a 3 sigma process the values are widely spread along the center line, showing the higher variation of the process. Whereas in a 6 Sigma process, the values are closer to the center line showing less variation in the process.

  10. Amount of process shift allowed 1.5 SD 1.5 SD LSL USL SD = 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

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