An Introduction to Six Sigma Quality

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An Introduction to Six Sigma Quality

• Presented by Darlene Mackay, CSQA
• Quality Assurance Institute

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Presentation Agenda

• 1. What is Six Sigma Quality?
• 2. Why would a company adopt Six Sigma?
• 3. Is there a roadmap to Six Sigma?
• 4. What are the challenges?
• 5. What are the rewards?

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1. What is Six Sigma Quality?

• Originated at Motorola in the early 80s
• Helped Motorola win the 1988 MBNQA
• Is a methodology for disciplined quality
  improvement
• Juran principles apply
• Doesnt use Quality in the name

• With the inclusion of Six Sigma into a sound
  business system, the major ingredients of a Total
  Quality Management System are usually in place
• Uses a modified Deming Wheel (PDCA)

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JURAN SAID

• All quality improvement occurs on a
  project-by-project basis and in no other way.

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What is Six Sigma Quality?

• Six Sigmas goal is the near elimination of
  defects from any process, product, or service.
• The numerical goal is 3.467 defects per million
  opportunities.

• Juran once concluded that in the US, close to 1/3
  of the work done consisted of redoing what had
  already been done.
• Depending on the industry, this Cost of Poor
  Quality (COPQ) could be 20 to 40 of total
  effort!

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Six Sigma Process Capability
SIGMA DPMO COPQ
CAPABILITY 6 sigma 3.4
lt10 of sales World Class 5 sigma 230
10 to 15 of sales 4 sigma 6200
15 to 20 of sales Industry average 3 sigma
67,000 20 to 30 of sales 2 sigma
310,000 30 to 40 of sales
Noncompetitive 1 sigma 700,000
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What is Six Sigma Quality?

• Strategy includes
• Measure
• Analyze
• Improve
• Control
• Improvement projects must be integrated with the
  goals of the organization.
• Six Sigma uses a divide and conquer approach as
  opposed to Continuous Process Improvement.

• Implementation is top-down. CEO drives, and
  executive management provides the Champion for
  each project.
• GEs implementation is often the de facto model
  for implementation.
• Uses concept of belts for levels of competency
  in Six Sigma implementation
• MBB Master Black Belt
• BB Black Belt
• GB Green Belt

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An Example

• Six Sigma Project Engineering Changes
• Define Large number of changes from client
  after approving engineering design. Schedule
  slipping.
• Measure Number of changes, time involved in
  changes, compliance to critical path schedule.
• Analyze No clear authority on client team to
  establish scope, any of client team could make
  changes, verbal communication of changes,
  conflicting changes by client team members.
  Language issues between client and engineers.
• Improve Regular engineering/client meetings
  where topics include scope for each section
  and desired objective, known limitations defined,
  unclear requirements were questioned and options
  discussed. Written plan signed by client
  representative and engineering lead. Change
  requests in writing and signed by client
  representative. Changes decrease by factor of
  4.7 and schedule met.
• Control Change requests all in writing. Shared
  approach with other disciplines on project.
• From www.adamssixsigma.com/Sample_Projects/six_s
  igma_projects.htm

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What is Six Sigma Quality?

• All Six Sigma projects are evaluated rigorously
  for financial impact.
• Most important is the financial cumulative impact
  of all projects upon the companys bottom line.

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Some Results

• Motorola 10 years 11 Billion Savings
• Allied Signal - 1.5 Billion estimated savings
• General Electric started efforts in 1995
• 1998 1.2 Billion less 450 Million in costs
  net benefits 750 Million
• 1999 Annual Report more than 2 Billion net
  benefits
• 2001 6,000 projects completed 3 Billion in
  savings

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Six Sigma according to GE

• A highly disciplined process that helps us focus
  on developing and delivering near-perfect
  products and services. The word Six Sigma is a
  statistical term that measures how far a given
  process deviates from perfection. The central
  idea behind Six Sigma is that if you can measure
  how many defects you have in a process, you can
  systematically figure out how to eliminate them
  and get as close to zero defects as possible.
  Six Sigma has changed the DNA at GE it is the
  way we work in everything we do and in every
  product we design.

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2. Why would a company adopt Six Sigma?

• Concept has been around for 16 years isnt just
  a fad.
• Six Sigma is the latest name for a comprehensive
  set of philosophies, tools, methods, and
  fundamental concepts.

• Continues to evolve at all organizational levels
  from CEO and CFO to the Black Belts and Green
  Belts.
• Has shown the most endurance and return on
  investment of any such program till now.

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The Roadmap to Six Sigma
North
East
West
South
Usually has many twists and turns!
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A Road Map for Six Sigma

• Appoint a Champion
• Select a Cross-functional team
• Develop quantifiable goals
• Develop an implementation plan
• Establish a training program
• Address data collection requirements and issues
• Develop a change control and maintenance program
• Coordinate your road map
• Article by John M. Gross, ASQ, Quality Progress
  Magazine, November 2001

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4. What are the Challenges of Six Sigma?

• The perception of Sick Sigma
• Culture change
• Understanding the DFSS (Design For Six Sigma)
• It is not a quick fix nor a recipe.
• Consultants cant make it happen.

• Training especially management level
• Takes careful preparation and a commitment to the
  foundational change efforts required.
• Statistical analysis is not generally part of the
  engineering discipline in most IT shops.

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What are the Challenges of Six Sigma?

• Reliability of data from the field.
• People must not fear giving bad news.
• Design is critical and yet many IT organizations
  continue to go straight from poor requirements
  into coding without the benefits of even one
  design review.

• Implementation tends to be uneven and lapses
  occur frequently.
• Not everything has to be Six Sigma this was our
  downfall on reengineering efforts!
• Lack of discipline and accountability.

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5. What are the Rewards ofSix Sigma?

• Improved reliability and predictability of
  software products and services.
• Increased value to the customers and
  shareholders.
• Improvements in organizational morale.

• Increased marketplace viability.
• Organizational recognition.
• Significant reduction in defects.
• Institutionalization of a process mindset.

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Some References

• Joseph M. Juran Jurans Quality Handbook
• (McGraw-Hill, 1999)
• Mikel J. Harry Six Sigma, A Breakthrough
  Strategy for Profitability (Quality Progress, May
  1998)
• William J. Hill Six Sigma at Allied Signal,
  Inc. (Presentation at 1999 QP Research
  Conference, May 1999)
• Jack Welch Six Sigma, the GE Way
• Six Sigma Forum Magazine www.asq.org/pub/sixsigm
  a
• Your favorite Search Engine search on Six
  Sigma