Key Concepts1COPQ (Cost of Poor Quality)- Lost Opportunities-
The Hidden Factory- More Setups- Expediting Costs- Lost Sales- Late
Delivery- Lost Customer Loyalty- Excess Inventory- Long Cycle
Times- Costly Engineering ChangesAverage COPQ approximately 15% of
Sales Hidden Costs: Intangible Difficult to MeasureTraditional
Quality Costs: Tangible Easy to Measure- Inspection- Warranty-
Scrap- Rework- Rejects2
Cost of Quality % SalesSigma LevelCOPQ v/s Sigma LevelCTQ
(Critical-To-Quality)CTQ characteristics for the process, service
or processMeasure of What is important to Customer6 Sigma projects
are designed to improve CTQExamples:Waiting time in clinicSpelling
mistakes in letter% of valves leaking in operation
4Defective and DefectA nonconforming unit is a defective
unitDefect is nonconformance on one of many possible quality
characteristics of a unit that causes customer dissatisfaction.A
defect does not necessarily make the unit defectiveExamples:Scratch
on water bottle (However if customer wants a scratch free bottle,
then this will be defective bottle)5Defect OpportunityCircumstances
in which CTQ can fail to meet.Number of defect opportunities relate
to complexity of unit.Complex units Greater opportunities of defect
than simple unitsExamples:A units has 5 parts, and in each part
there are 3 opportunities of defects Total defect opportunities are
5 x 3 = 15 6DPO (Defect Per Opportunity)Number of defects divided
by number of defect opportunitiesExamples:In previous case (15
defect opportunities), if 10 units have 2 defects.Defects per unit
= 2 / 10 = 0.2DPO = 2 / (15 x 10) = 0.01333337DPMO (Defect Per
Million Opportunities)DPO multiplies by one millionExamples:In
previous case (15 defect opportunities), if 10 units have 2
defects.Defects per unit = 2 / 10 = 0.2DPO = 2 / (15 x 10) =
0.0133333DPMO = 0.013333333 x 1,000,000 = 13,333 Six Sigma
performance is 3.4 DPMO 13,333 DPMO is 3.7 Sigma 8YieldProportion
of units within specification divided by the total number of
units.Examples:If 10 units have 2 defectivesYield = (10 2) x 100
/10 = 80 %Rolled Through Yield (RTY)Y1 x Y2 x Y3 x . x YnE.g 0.90 x
0.99 x 0.76 x 0.80 = 0.549
