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Production And Operation
Management
SIX SIGMA
WHAT IS SIGMA ?
A term (Greek) used in statistics to represent standard deviation from mean value, an indicator of the degree of variation in a set of a process.
Sigma measures how far a given process deviates from perfection. Higher sigma capability, better performance
What is Six Sigma? Six Sigma is a disciplined, data-driven approach and
methodology for eliminating defects (driving toward six standard deviations between the mean and the nearest specification limit) in any process – from manufacturing to transactional and from product to service.
Wise application of statistical tools within a structured methodology
Repeated application of strategy to individual projects
What is Six Sigma? In 1986, Bill Smith, a senior engineer and scientist at Motorola,
introduced the concept of Six Sigma to standardize the way
defects are counted. Six Sigma provided Motorola the key to addressing quality
concerns throughout the organization, from manufacturing to
support functions. The application of Six Sigma also
contributed to Motorola winning the Malcolm Baldrige
National Quality award in 1988. Since then, the impact of the Six Sigma process on improving
business performance has been dramatic and well documented
by other leading global organizations, such as General Electric,
Allied Signal, and Citibank.
Six Sigma Methods Production
DesignService
Purchase
HRM
Administration
QualityDepart.
Management
IT
Where can Six Sigma be applied?
WHY SIX SIGMA ? Six Sigma emerged as a natural evolution in
business to increase profit by eliminating defects
The Current business environment now demands and rewards innovation more than ever before due to:
Customer Expectations Technological Change Global Competition
Sigma Levels Screenshot_2015-03-09-18-13-38.png
SIX SIGMA METHODOLOGY(It takes money to save money)
BPMS Business Process Management System
DMAIC Six Sigma Improvement Methodology
DMADV Creating new process which will perform at Six Sigma
BUSINESS PROCESS MANAGEMENT SYSTEM
BPM strategies emphasize on process improvement and automation to derive performance.
Combining BPM strategies with sigma six is most powerful way to improve performance.
Both strategies are not mutually exclusive but some companies produced dramatic results by combining them.
WHAT IS DMAIC?(Define,Measure,Analyse,Improve.Control)A logical and structured approach
to problem solving and process improvement.
An iterative process (continuous improvement)
A quality tool which focus on change management style.
PHASESPhases of Six Sigma are:
Define specific goals to achieve outcomes, consistent with customers demand and business strategy
Measure reduction of defectsAnalyze problems ,cause and
effects must be considered Improve process on bases of
measurements and analysisControl process to minimize
defects
WHAT IS DMADV?
Acronym for: Define the project Measure the opportunity Analyze the process options Design the process Verify the performance
TOOLS & TECHNIQUES 7QC tools Check Sheets (collect data to make
improvements) Pareto Charts( define problem and frequency) Cause and effect diagram (Identify possible
causes to solve problem) Histogram (Bar charts of accumulated data to
evaluate distribution of data) Scatter diagram (plots many data points and
pattern between two variables) Flow Chart (Identify unwanted steps) Control charts (Control limits around mean
value)
Pareto chart ( define problem and frequency)
A pareto chart is used to graphically summarize and display the relative importance of the differences between groups of data.
What Questions the Pareto Chart Answers
What are the largest issues facing our team or business?
What 20 percent of sources are causing 80 percent of the problems (80/20 Rule)?
80/20 Rule Applications
• 80 percent of process defects arise from 20 percent of the process issues.• 20 percent of your sales force produces 80 percent of your company revenues.• 80 percent of customer complaints arise from 20 percent of your products or services.
Cause and effect diagram (Identify possible causes to solve problem)
It is particularly useful in a group setting and for situations in which little quantitative data is available for analysis.
Histogram (Bar charts of accumulated data to
evaluate distribution of data) histogram is used to graphically summarize and display the distribution of a process data set.
What Questions the Histogram Answers
What is the most common system response?
What distribution (centre , variation and shape) does the data have?
Does the data look symmetric or is it skewed to the left or right?
Scatter diagram (plots many data points and pattern
between two variables) A scatter plot, also called a
scatter diagram or a , is a basic graphic tool that illustrates the relationship
between two variables. It is a tool used to visually
determine whether a potential relationship exists between an input and an outcome.
Flow Chart (Identify unwanted steps)
A flowchart is a type of diagram that represents an algorithm, workflow or process, showing the steps as boxes of various kinds, and their order by connecting them with arrows. This diagrammatic representation illustrates a solution model to a given problem.
It represents the entire process from start to finish
Flow Chart Symbol
Control charts (Control limits around mean value)
Control charts have two general uses in an improvement project.
The most common application is as a tool to monitor
process stability and control.
KEY ROLES FOR SIX SIGMA
Six Sigma identifies several key roles for its successful implementation:
Executive leadershipChampions Master Black Belts (Identify projects&
functions)Black Belts (Identify non value added
activities)Green Belts ( works on small projects )
Top
Bottom
Six Sigma Certificate
USAGE OF SIX SIGMA
Six Sigma Companies
Six Sigma and Financial Services