Foundations of Six Sigma: Principles of Quality Management

1
Chapter 1

• Foundations of Six Sigma Principles of Quality
  Management

2
What is Six Sigma?
Six Sigma can be described as a business
improvement approach that seeks to find and
eliminate causes of defects and errors in
manufacturing and service processes by focusing
on outputs that are critical to customers and a
clear financial return for the organization. Six
Sigma was pioneered by Motorola in the mid-1980s
and popularized by the success of General
Electric.
3
Six Sigma Methodology

• DMAIC
• Define
• Measure
• Analyze
• Improve
• Control
• Incorporates a wide variety of statistical and
  process improvement tools

4
Key Concepts of Six Sigma (1 of 2)

• Think in terms of key business processes,
  customer requirements, and overall strategic
  objectives.
• Focus on corporate sponsors responsible for
  championing projects, support team activities,
  help to overcome resistance to change, and
  obtaining resources.
• Emphasize such quantifiable measures as defects
  per million opportunities (dpmo) that can be
  applied to all parts of an organization

5
Key Concepts of Six Sigma (2 of 2)

• Ensure that appropriate metrics are identified
  early and focus on business results, thereby
  providing incentives and accountability.
• Provide extensive training followed by project
  team deployment
• Create highly qualified process improvement
  experts (green belts, black belts, and
  master black belts) who can apply improvement
  tools and lead teams.
• Set stretch objectives for improvement.

6
Six Sigma Works for Everyone

• Plant managers reduce waste, improve product
  consistency, solve equipment problems, create
  capacity
• Human resource managers reduce cycle time for
  hiring processes
• Sales managers improve forecast reliability,
  pricing strategies, pricing variation
• Anyone better understand customer needs and
  tailor service offerings to meet them

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Quality Management and the Evolution of Six Sigma
(1 of 3)

• Skilled craftsmanship during Middle Ages
• Industrial Revolution rise of inspection and
  separate quality departments
• Early 20th Century statistical methods at Bell
  System
• Quality control during World War II
• Post-war Japan evolution of quality management

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Quality Management and the Evolution of Six Sigma
(2 of 3)

• Quality awareness in U.S. manufacturing industry
  during 1980s from Little Q to Big Q - Total
  Quality Management
• Malcolm Baldrige National Quality Award (1987)
• Disappointments and criticism

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Quality Management and the Evolution of Six Sigma
(3 of 3)

• Emergence of quality management in service
  industries, government, health care, and
  education
• Birth of Six Sigma
• Current and future challenge keep progress in
  quality management alive

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Six Sigma vs. TQM

• Six Sigma
• Owned by business leader champions
• Cross functional projects
• Rigorous and advanced statistical tools
• Requires verifiable return on investment

• TQM
• Based on worker empowerment and teams
• Department or workplace focus
• Simple improvement tools
• Little financial accountability

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Formal Definitions of Quality

• Design perspective quantities of product
  attributes
• Customer perspective fitness for intended use
• Operations perspective conformance to
  specifications

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Customer-Driven Quality

• Meeting and exceeding customer expectations
• Customers
• Consumers
• External customers
• Internal customers

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Principles of Total Quality

• Focus on customers
• Participation and teamwork
• Process focus supported by continuous improvement

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Customer Focus

• Customer is principal judge of quality
• Organizations must first understand customers
  needs and expectations in order to meet and
  exceed them
• Organizations must build relationships with
  customers

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Customer Focus in Six Sigma
To meet or exceed customer expectations,
organizations must fully understand all product
and service attributes that contribute to
customer value and lead to satisfaction and
loyalty called critical to quality (CTQ)
characteristics. CTQs represent the important
drivers of Six Sigma improvement efforts.
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Participation and Teamwork

• Employees know their jobs best and therefore, how
  to improve them
• Management must develop the systems and
  procedures that foster participation and teamwork
• Empowerment better serves customers, and creates
  trust and motivation
• Teamwork and cross-functional cooperation
  encourage employee involvement and lead to more
  effective problem solving

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Process Focus and Continuous Improvement

• A process is a sequence of activities that is
  intended to achieve some result

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Continuous Improvement

• Enhancing value through new products and services
• Reducing errors, defects, waste, and costs
• Increasing productivity and effectiveness
• Improving responsiveness and cycle time
  performance

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Synergies Among Response Time, Quality, and
Productivity
Major improvements in response time may require
significant simplification of work processes and
often drive simultaneous improvements in quality
and productivity.
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Six Sigma and Business Results
Considerable evidence exists that Six Sigma
initiatives positively impact bottom-line results
from companies such as GE, Allied Signal, 3M,
Xerox, Raytheon, Citibank, and many others.