Six Sigma

1. Six Sigma

2. Six Sigma Revolution • Deming’s teaching about quality • Quality initiatives: • SPC, Just-in-time, TQM • Motorola in 1980’s • GE and AlliedSignal in 1990’s • Radical Changes in products and services • Companies: • TI, ABB, DuPont, Ford, Dow Chemical, Johnson Controls, BASF, American Express, Nokia, Toshiba,

3. What is Six Sigma? • Vision • Philosophy • Company Strategy • Method • Culture • Tool

4. The Cost of Poor Quality (COPQ) Warranty Inspection Tangible Quality Costs Rework Rejects Scrap Lost sales Lost Opportunities Late delivery Hidden Factory More Setups Expediting costs Engineering change orders Lost Customer Loyalty Excess inventory Long cycle times

5. 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 Nature of the Process On-target, less variation Variation Off-Target Six Sigma goal identifies and controls process variations and targets. Six Sigma methodology identifies processes that are off-target,

6. What is Six Sigma? • Integrates • Customer focus • Breakthrough improvement • Continuous improvement • People Involvement • Defines goals and performance metrics that yield clear and measurable business results. • Applies statistical tools to achieve breakthrough financial gains

7. Six Sigma Focus • Meeting customer needs • Rapid breakthrough improvement • Process capability and improvement • Positive and deep culture change • Real financial results that impact the bottom line

8. Structure / Roles

9. Building the 6 Team • Executive Management: • Set meaningful goals and propel implementation of six sigma in the organization • Champion: • Create general scope and set strategic direction of the projects and teams • Drive project success by removing obstacles and allocating sufficient resources • Master Black Belt • Consults, trains and mentors the local organization on Six Sigma • Black Belt: • Delivers successful projects (high corporate gains) using the Breakthrough Strategy • Green Belt: • Delivers local projects (lower monetary gains) using the Breakthrough Strategy • Other key members: • Process Owner: maintains system improvements at project completion • Process Sponsor: provides resources, time, money and direction of your project • Financial Analyst: verifies the financial gains of the project • Team members: implement the steps for six sigma success

10. What is Sigma? • s (sigma) - A Greek letter • In statistics - the “standard” deviation from the average/mean • Assumption of Gaussian/Normal distribution • Six Sigma Methodology uses s to define the capability of a process • As the standard deviation of your process decreases, the “sigma level” of your process increases.

11. Normal/Gaussian Distribution 34.13% 34.13% 13.06% 13.06% 2.14% 2.14% 0.13% 0.13% -3s -2s -1s m 1s 2s 3s 68.26% 95.46% 99.73% 68.26% of the population is within +/- 1 of the ?? ?

12. Process Capability 6s process is to get acceptable results through: • Identification of variations • Quantification of variations • Elimination/control of variations USL LSL Defects Defects Acceptable

13. Six Sigma - Goal s Defects per Million Opp. 1 691,462 308,537 2 66,807 3 6,210 4 233 5 3.4 6

14. Six Sigma -- Practical Meaning 99% Good (3.8 Sigma) 99.99966% Good (6 Sigma) 16,000 lost articles of mail per hour 5.4 articles lost per hour 22,000 checks deducted from the wrong bank account each hour 7.5 checks deducted from the wrong bank account each hour 500 incorrect surgical operations per week 1.7 incorrect operations per week 2 unsafe plane landings per day at O’Hare International Airport in Chicago 1 unsafe plane landing every four years 50 newborn babies dropped at birth by doctors each day 1 newborn baby dropped at birth by doctors every 2 months ** Source: Six Sigma Revolution, George Eckes

15. Overall Approach Define Define Problem Measure Practical Problem Analyze Statistical Problem Statistical Solution Improve Control Practical Solution

16. The Strategy USL LSL • Characterize • Optimize • Breakthrough T USL LSL T USL LSL T LSL’ USL’

17. The 6 Sigma Breakthrough Method • Define project and scope • Establish process D Define • Identify key input/outputs variables • Identify process capability/ measurement system M Characterization Measure 5 Establish Product Capability 6 Identify Variation Sources A Analyze 7 Screen Potential Causes 8 Verify Variable Relationships I Improve Optimization 9 Validate Measurement System 10 Implement Process Controls C Control

18. Define Measure Analyze Improve Control Defining the Process • Team members who understand the process • Put together a flow of the process • An common foundation for team activity • Identification of outputs for measurement and capability studies • Estimates of sigma levels at each step

19. Define Measure Analyze Improve Control Project Scope • Problem statement • Goals/objectives for the team • Measurable gains (monetary terms) • Milestone • Customer needs and requirements

20. Define Measure Analyze Improve Control Process Mapping • What is process mapping? • Graphical depiction of the ACTUAL process • What will the tool identify? • All value added and non-value added process steps • Process inputs (X’s) • Process or product outputs (Y’s) • Data collection points

21. Define Measure Analyze Improve Control Basic Flowchart Symbols Activity Start / Stop Flow Line Decision Point A Connector A

22. Define Measure Analyze Improve Control Basic Structure • What are the steps to capture? • What are the operational steps? • What are the decision points? • Where are the problem area?

23. Define Measure Analyze Improve Control Versions of a Process What You Think It Is... What It Actually Is... What You Would Like It To Be...

24. Define Measure Analyze Improve Control Preparing the Process Flowchart • Team Effort • Engineers • Line Operators • Line Supervisors • Maintenance Technicians • Inputs to Flowcharts • Brainstorming • Operator Manuals (SOP’s, AOP’s, etc.) • Engineering Specifications • Operator Experience • 5M’s and an E (Fishbone) • Machine (Equipment), Method (Procedures), Measurement, Materials, Manpower (People), Environment

25. Define Measure Analyze Improve Control Measurement Phase • The input/output variables • The capability of the process • The defects in the process • Sigma level

26. Define Measure Analyze Improve Control Purpose of Measurement Phase • Identify and define defects • Identify key input variables (X’s) and key output variables (Y’s) • Document the existing process • Establish a data collection system for your X’s and Y’s if one does not exist • Evaluate measurement system for each key output variable using C&E, FMEA, etc.

27. Define Measure Analyze Improve Control The Importance of Defects • Since Six-Sigma focuses on reducing defects, it is necessary that each project definition clearly specifies the defect(s) that will be reduced • Count the number of times the letter f appears in the following statement: Six Sigma Revolution, George Eckes, pg 2

28. Define Measure Analyze Improve Control A simple test 13 • What was your answer? The final information are the results of years of scientific studies and were often combined with years of experience. We must often configure the files for the final report during the conference.

29. Define Measure Analyze Improve Control What Causes Defects? • Variation due to: • Manufacturing processes • Supplier (incoming) material variation • Unreasonably tight specifications (beyond customer needs) • Unstable Parts and Materials • Inadequate training • Inadequate Design Margin • Insufficient Process Capability

30. Define Measure Analyze Improve Control How Do We Improve Capability • Understand that the Outputs (Y’s) are determined by Inputs (X’s). • If we know enough about our X’s we can accurately predict Y without having to measure it. • If we don’t know much about our X’s, then we have to resort to inspection and test. • If can control the X’s, then we reduce the variability in Y, which decreases defects, and possibly, eliminates/reduces inspection and test. Y = F (x1, x2, x3,…xn)

31. Define Measure Analyze Improve Control Data Collection Plan Six Sigma Revolution, George Eckes, pg 72

32. Define Measure Analyze Improve Control Data Collection Data • Type of Data • Discrete • Continuous • Sampling • Representative • Random Sampling

33. Define Measure Analyze Improve Control Metrics: What to measure? • Defects per million opportunities (DPMO) drives plant-wide improvement • Sigma level allows for benchmarking within and across companies

34. Define Measure Analyze Improve Control Calculating Sigma-Level • Sigma level • units: item produced or being serviced • defect: event that does not meet the customer’s requirement • opportunity: chance for a defect to occur • Calculate Defects per Million Opportunities (DPMO): defects x 1,000,000 Total # DPMO = (# of Opportunities for Error) x (# of units) • Go to a Sigma Chart and Estimate the Sigma Level Six Sigma Revolution, George Eckes, pg 99

35. Define Measure Analyze Improve Control DPMO and Sigma Level

36. Define Measure Analyze Improve Control Tracking Trends in Metrics Our objective is to track the trends in the Metrics to establish, based on fact, our improvements. These metrics can be productivity, defects, time, yield, etc.

37. Define Measure Analyze Improve Control Purpose of the Analysis Phase • Establish baseline capability for key output variables (potential and overall) • Examine both the process and data for analysis • Determine and validate the root causation of project problem • To reduce the number of process input variables (x’s) to a manageable number • To determine the presence of and potential elimination of uncontrolled variables

38. Define Measure Analyze Improve Control Three Sigma Process Centered 1.5 Sigma Shift

39. Define Measure Analyze Improve Control Three Sigma Process Centered 1.5 Sigma Shift

40. Define Measure Analyze Improve Control Six Sigma Process Centered 1.5 Sigma Shift

41. Define Measure Analyze Improve Control Analysis Tools

42. Define Measure Analyze Improve Control Purpose of the Improvement Phase • Key variables are identified and validated during this process . • Look to eliminate, reduce or neutralize the effects of the input or root cause. • Design experiments to manipulate the key input variables (X’s) to determine their effect on the outputs (Y’s). • Select the solution that impacts the root cause the most.

43. Define Measure Analyze Improve Control Design of Experiment • Full Factorials • 2K Factorials • Fractional Factorials

44. Define Measure Analyze Improve Control DOE Example • Objective: To reduce consistency variation in Y • Output: Variation (Lower is Better) • Full Factorial Inputs: • RPM (Lo, Hi) • Speed (Lo, Hi) • Time (Lo, Hi) Main Effects Plot 16 14 12 10 8 R P M Time Speed

45. Define Measure Analyze Improve Control Purpose of the Control Phase • Develop and implement long-term control methods to sustain the gains identified • Document the control plan with specific roles identified • Monitor long-term delivered capability and performance • Verify benefits and cost savings

46. Define Measure Analyze Improve Control Control Tools Control • Control Plan • SPC • Mistake Proofing • Automated Control

47. Dynamics of Execution Strategy 40 - 50 Inputs M Process Map/C&E 15 - 20 X’s A Capability/Multi-Vari 8 - 10 X’s I DOE 3-5 Critical X’s C Control Plan

48. Who needs Six Sigma? As long as there is a process that produces an output, we can apply the Six Sigma Methodology. Every function has a customer and a deliverable.

49. Six Sigma Project Consideration • Project is supportive of corporate objectives • Project is focused on an ongoing process / recurring events that is causing defects • A 70% reduction in defects results • Customer (internal or external) will see or feel the result • Takes 4-6 months to complete • Little or no capital required

50. Possible Six Sigma Projects • Low yield rate • High operating costs • High customer failure/complaints • High scrap/rework • High inventory/WIP • High maintenance costs • Supplier product quality problems • Low productivity • Long cycle times • Low machine utilization • Inaccurate information • Missing information • Poor process control • Frequent set up requirements • Long set up time • Unpredictable product performance