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$ix $igmaRemarkable Results and Rave Reviews

Is it really more fun than a Root Canal?

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AgendaAgenda

and 6• Some 6 History• Normal Distribution, Specification Limits, Control

Limits, and the 6 Methodology• How good is 99% accuracy? - 6 vs. 3• What are the 6 benefits? Why is it attractive?• The DMAIC model• Some 6 tools• TQM failures and 6 successes

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• Sigma () is a Greek letter used to measure the variability or the spread in a process

• In business, is a metric that measures how well a processes is performing and how often a defect is likely to occur

• The higher the Sigma value, the lower the variation and fewer the defects

• Traditionally, companies accepted 3 or 4 sigma performance levels as the norm

• Six Sigma effectively utilizes some proven quality tools, principles and techniques

• The 6 tools are applied within a simple model known as DMAIC (Define-Measure-Analyze-Improve-Control )

and 6 and 6 !!

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So, What is Six Sigma?So, What is Six Sigma?

• Six Sigma is a business system for achieving and sustaining success through Customer Focus, Process Management, Process Improvement, and the wise use of Facts and Data

• It can be used for any activity that is concerned with cost, quality, and timeliness. It can be used from production, to human resources, to order entry, to technical support

• Unlike previous quality improvement efforts, Six Sigma is designed to provide tangible business results and cost savings that are directly tied to the bottom line

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Customer Centered

Data Driven

SystematicApproach

Six Sigma is a

MethodFor Doing Things Better

Focus is on customer wants and needs

The 6 integrated tools are applied routinely, repeatedly

and in harmony

Decisions are based on data and facts

Better for the customers, workers and shareholders

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Some Six Sigma HistorySome Six Sigma History

• Roots of Six Sigma can be traced back to the 17th century when Gauss introduced the normal curve

• In the 1920's, Shewhart showed that 3 from the mean is the point where a process requires correction

• In the 1970s, a Japanese firm took over a Motorola factory in the US (Quasar TV) and achieved a 95% reduction in defects while using the same workforce, technology, and designs

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Some Six Sigma History (continued)Some Six Sigma History (continued)

• In the mid 1980s, Motorola decided to take quality seriously and developed the Six-Sigma standard / methodology

• In 1988, Motorola won the Malcolm Baldrige Award, became a worldwide quality and profit leader, and reported Billions of savings as a result of using Six-Sigma

• Soon, other major US and world companies adapted the new standard and reported huge successes. Among them Allied Signal, GE, and Honeywell.

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Cost of Poor Quality (% of Revenues) versus Cost of Poor Quality (% of Revenues) versus Level Level

0%

5%

10%

15%

20%

25%

Sigma Level

GE: $8 - $12 Billion/Yr

25%

15%

10%

5%

2%

9

10

11

12

13

14

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Product Specifications vs. Process OutcomeProduct Specifications vs. Process Outcome

Control LimitsSpecifications

LSL USL

Nominal Average

LCL UCL

16 Chapter 4: Six Sigma for Process and Quality Improvement

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Motorola’s Assumption the Process Mean Can Shift by as Much as 1.5 Standard Deviations

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Six Sigma Long Term Shift & DriftSix Sigma Long Term Shift & Drift

LSL USL1.5 1.5

NominalAverage Average

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“Short Term Goal = Long Term Goal + Appropriate Compensation Factor for Environmental Changes”

What is the 1.5 Sigma Shift? How is it applied?Keeping the above equation in mind, consider the following1.In terms of project management statistics, 2 defects per billion opportunities in a project correspond to six sigma and 3.4 defects per million opportunities corresponds to 4.5 sigma.2.The overall goal is a near-zero defect process, or a 4.5 Sigma Level for the process in the long term.3.The environmental changes and the magnitude of this change is 1.5 Sigma (Calculated empirically by Motorola as the Long Term Dynamic Mean Variation)Thus the Short Term Sigma Level (6) = Long Term Sigma Level (4.5) + Compensation Factor (1.5 Sigma Shift)i.e. a Short Term goal of a 6 Sigma Level translates to 3.4 defects per million opportunities (4.5 Sigma Level) over the Long Term.This is illustrated in the figure below.                 The red area indicates the process without any shift in the mean.The green area indicates the shift of 1.5 in the process mean.Thus the short term sigma level aimed at is 6, in order to achieve a 3.4 PPM process corresponding to a 4.5 sigma level over a long term.

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What Is Six Sigma and the 1.5 shift?The Original Concepts And TheoriesTo quote a Motorola hand out from about 1987 ...'The performance of a product is determined by how much margin exists between the design requirement of its characteristics (and those of its parts/steps), and the actual value of those characteristics. These characteristics are produced by processes in the factory, and at the suppliers.Each process attempts to reproduce its characteristics identically from unit to unit, but within each process some variation occurs. For more processes, such as those which use real time feedback to control outcome, the variation is quite small, and for others it may be quite large.A variation of the process is measured in Std. Dev, (Sigma) from the Mean. The normal variation, defined as process width, is +/-3 Sigma about the mean.Approximately 2700 parts per million parts/steps will fall outside the normal variation of +/- 3 Sigma. (see chart #2) This, by itself, does not appear disconcerting. However, when we build a product containing 1200 parts/steps, we can expect 3.24 defects per unit (1200 x .0027), on average. This would result in a rolled yield of less than 4%, which means fewer than 4 units out of every 100 would go through the entire manufacturing process without a defect.  (see chart #3)Thus, we can see that for a product to be built virtually defect-free, it must be designed to accept characteristics which are significantly more than +/- 3 sigma away from the mean.It can be shown that a design which can accept TWICE THE NORMAL VARIATION of the process, or +/- 6 sigma, can be expected to have no more than 3.4 parts per million defective for each characteristic, even if the process mean were to shift by as much as +/- 1.5 sigma (see chart #2) In the same case of a product containing 1200 parts/steps, we would now expect only only 0.0041 defects per unit (1200 x 0.0000034). This would mean that 996 units out of 1000 would go through the entire manufacturing process without a defect. To quantify this, Capability Index (Cp) is used; where:

A design specification width of +/- 6 Sigma and a process width of +/- 3 Sigma yields a Cp of 12/6 = 2. However, as shown in (see chart #4), the process mean can shift. When the process mean is shifted with respect to design mean, the Capability Index is adjusted with a factor k, and becomes Cpk. Cpk = Cp(1-k), where:

K factor= Process Shift Design Specification Width

The k factor for a +/- 6 Sigma design with a 1.5 Sigma process shift ...1.5/6 = 0.25and theCpk = 2(1- 0.25)=1.5

Cp= Design specification Width

Process Width

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Six Sigma is not a panacea: Motorola popularized the benefits of having six standard deviations between the process' nominal and each specification limit. If the process remains centered on the nominal, it has a Cpk (process capability index) of 2.0. This means a one part per billion nonconformance rate in each tail (above the upper specification and below the lower specification). Motorola allowed for a 1.5-sigma process shift-- which any decent statistical process control chart should detect very quickly, by the way-- which would make Cpk 1.5, and the nonconformance rate 3.4 ppm.

                                        Six Sigma process capability with the process centered on its nominal (100). Cpk=2.0 and the nonconformance rate is 2 parts per billion.

A Six Sigma process with a 1.5 sigma shift in the process mean. Cpk=1.5 and the nonconformance rate is 3.4 parts per million.

Again, there is nothing wrong with this, but there is nothing new about it either. Walter Shewhart and his contemporaries identified the issue of process capability decades ago, and Henry Ford was seeking ever-more-precise manufacturing equipment during the 1910s and 1920s! Ford, in fact, had to hire Carl Johannson (of the famous Jo blocks, or gage blocks) to get the precision measurement systems necessary to support his operation. During the 1920s, Ford boasted of owning Jo blocks with 1-microinch (25.4 nanometer) steps; these dimensions now come to mind in microelectronics manufacturing.In summary, "Variation is the enemy" (we've known that for decades). Design for manufacture (DFM) includes consideration of the variation from the tools that will actually have to make the product. "Design for Six Sigma" is basically DFM, which also was a cornerstone of Henry Ford's manufacturing methods.

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LSL

LSL USL

Nominal

MeanMean

6 6 vs. 3 vs. 3 Centered 3 Process,

66,372 defects of 1 million opportunities

Shifted 6 Process, 3.4 defects of 1 million

opportunities

Mean

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Simplified Conversion Table:

DPMO*6 3.45 3204 6,2103 66,8002 308,0001 690,000

* Defect Per Million Opportunity

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The DMAIC ModelThe DMAIC Model

The ProblemProject ScopeThe CustomerMetricsCurrent Process map

DeliverablesProcess KIVProcess KOV

Collect DataFeed to SPCVariation Key MetricsGR&R (Validation)Process CapabilityYieldSigma Level

Pareto ChartsMultilevel ParetoRoot CauseControl ChartsFishbone D.FMEAProcess MapsMajor ObstaclesNeeded Resources

Multi-VariOptimizationDOE PMTrain OperatorsVisual AidsGauges &Fixtures

Control PlansMonitoringStandardizationDocumentationAudits & ReportsPreventionMistake ProofSustain the Gain

Define ImproveMeasure Analyze Control

ProcessInput: x Output: Y=f (x)

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Benefits of Using $ix $igmaBenefits of Using $ix $igma

Productivity Improvements

Culture ChangeCustomer Retention

Product/Service Development

Cycle Time Reduction

Market-Share Growth

Cost Reduction

DMAIC

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What makes it Attractive?What makes it Attractive?

Tool to Plan & Deliver Values To Customers

Sets a PerformanceGoal for Everyone

Accelerates the RateOf Improvement

Measurable ResultsTied to the Bottom-line

Promotes Learning &Cross-Pollination

Executes StrategicChange

Generates Sustained Results

$ix $igma

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Is It Easy to Implement?Is It Easy to Implement?

• Done right, Six-Sigma is a lot of work• It has its own risks, and takes an investment in:

• Time, • Energy, and • Money

• Implementing 6, company wide, could be a challenge• However, Six-Sigma improvements are usually

thrilling and rewarding

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Some Six Sigma ToolsSome Six Sigma Tools

Voice of the Customer

Process Design/Re-design

Process Management

Creative Thinking

SPC

6 DOE

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Six Sigma and other Continuous Improvement InitiativesSix Sigma and other Continuous Improvement Initiatives

Quick Strike 1-6 day Process mapping Cause & Effect Other basic tools

Kaizen

One piece flow Cells Visual controls Pull system Kanban TPM

Lean

DMAIC Statistical tools FMEA Cp and Cpk GR&R ANOVA & DOE

Six Sigma

Quick fixes Simple solutions Containment

Cycle time Waste Inventory Standardization Variance

Complex problems Defect prevention Stability Process capability Customer focused Variation reduction

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TQM failures and 6TQM failures and 6 success success

1- Leadership

6

• Viewed as a “Mgt Tool”• More visible activity• Monitored closely• Continuous Mgt reviews• Constant reinvention of the business

TQM

• Viewed as a “Quality Tool” • Top Mgt skepticism (OT) • Occasional. Firefighting.• Temporary, tied to the leader who started the initiative

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TQM failures and 6TQM failures and 6 success success

2- Goals

6• Ambitious and challenging• Goals & results are tied to $s• People can see their results grow• Closed-loop system helps to adjust

TQM• Unclear, fuzzy and hard to measure (meeting or exceeding ..)• Might meet today's customer needs, but not ready for tomorrow's

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TQM failures and 6TQM failures and 6 success success

3- Focus

6

• Attention to all business processes• Works in transactional and services• More total than “Total Quality”

TQM

• Focus on product quality• Efforts are concentrated on mfg & production• Not enough focus on customer wants and needs

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TQM failures and 6TQM failures and 6 success success

4- Barriers

6

• Cross Functional. •Targets customer-critical issues• The built in “Process Management” monitors, measures and improves processes

TQM

• “Departmental” Activity• Improvement projects are done in isolated chunks (Engineering Project, HR project, Mfg project, etc..)

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TQM failures and 6TQM failures and 6 success success

5- Application

6

• Involves process owners & Mgrs • Demands a great diversity of skills• Adopts tools to circumstances• Uses tools that get results

TQM

• More of a “Quality Police” activity• Quality tools are applied by the quality experts only• Inappropriate / unnecessary tools could waste resources

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TQM failures and 6TQM failures and 6 success success

6- Training

6

• Demanding and heavy• Well structured – hands on• Training is mandatory and sometimes tied to promotion• Training is not limited to Quality professionals

TQM

• Light and weak• Not well structured• More theory, less applications• Less emphasis on advanced statistical analysis