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SIX SIGMA. What is six sigma? Sigma is a measure of “goodness: the capability of a process to produce perfect work. A “defect” is any mistake that results.

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Presentation on theme: "SIX SIGMA. What is six sigma? Sigma is a measure of “goodness: the capability of a process to produce perfect work. A “defect” is any mistake that results."— Presentation transcript:


2 What is six sigma? Sigma is a measure of “goodness: the capability of a process to produce perfect work. A “defect” is any mistake that results in customer dissatisfaction. Sigma indicates how often defects are likely to occur. The higher the sigma level, the lower the defect rate. The lower the defect rate, the higher the quality.

3 What is Six Sigma  It is a statistical term that measures how far a given process deviates from perfection.  Central idea behind Six Sigma - 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.  A defect can be anything from a faulty part to an incorrect customer bill.  To achieve Six Sigma quality, a process must produce no more than 3.4 defects per million opportunities.  An "opportunity“ is - a chance for nonconformance, or not meeting the required specifications.

4 What is Six Sigma…2 This means organizations need to be nearly flawless in executing their key processes. Critical to Quality: Attributes most important to the customer Defect: Failing to deliver what the customer wants Process Capability: What your process can deliver Variation: What the customer sees and feels Stable Operations: Ensuring consistent, predictable processes to improve what the customer sees and feels Design for Six Sigma: Designing to meet customer needs and process capability

5 Cost of Quality at various levels of Six Sigma Sigma Defect Rate (DMPO) Cost of Quality 63.4<10% World WorldClass 523310-15% 4621015-20% Industry Industry Average Average 36680720-30% 230853730-40% Non- Competitive level 16,90000>40%


7 What is Cost of Poor Quality? For a decrease of one sigma the manufacturing cost of the product increases by about 10%. Companies operating at 3 or 4 sigma spend b/w 25 & 40 % of their revenues in fixing the defects or problems- Cost of Quality. In almost every company where the COPQ is unknown, the COPQ exceeds the profit margin.

8 Six Sigma Methodology  Six Sigma focuses on improving quality (i.e. reducing waste) by helping organizations to produce products & services better, faster & cheaper.  It focuses on defect prevention, cycle time reduction, & cost savings.  Two approaches for achieving the Six Sigma goal: - Improving existing products and processes. - Developing new products and processes.

9 Why six sigma? Sigma allows comparison of products and services of varying complexity Also, it provides a common basis for benchmarking (competitors and non-competitors). The higher the sigma level, the better your operation is performing. Sigma measures how well you’re doing in getting to zero defects.

10 Possible applications  Human Resources: reduce the number of requisitions unfilled after 30 days.  Customer Service: measure the number of calls answered on the first ring.  Order Fulfillment: eliminate Customer returns because of incorrect parts or product being shipped.  Finance: reduce the instances of accounts being paid after a specified time limit has elapsed.

11 What is DMAIC  It is an approach undertaken to improve existing business process  Six sigma combination of 5 interconnected phases of a process improvement project. Following are the phases:






17 DMADV APPROACH  This approach is undertaken when there is a need to create new design or product  5 steps in DMADV approach-  Define  Measure  Analyze  Design details  Verification

18 DMADV explanation  Define design goals that are consistent with customer demands and the enterprise strategy.  Measure and identify CTQs (characteristics that are Critical To Quality), product capabilities, production process capability, and risks.   Analyze to develop and design alternatives, create a high-level design and evaluate design capability to select the best design.  Design details, optimize the design, and plan for design verification. Verify the design, set up pilot runs, implement the production process and hand it over to the process owners.  DMADV is also known as DFSS, an abbreviation of "Design For Six Sigma".

19 Difference b/w DMAIC and DMADV  IN DMAIC  1.Defines a business process  2.Measuring current process  3.Identify root cause of the recurring problem  4.Improvements made to reduce defects  5. Keep check on future performance

20  The DMAIC methodology should be used when a product or process is in existence at your company but is not meeting customer specification or is not performing adequately  The DMADV methodology should be used:- When a product or process is not in existence at your company and one needs to be developed The existing product or process exists and has been optimized (using either DMAIC or not) and still doesn't meet the level of customer specification or six sigma level

21 The six sigma organization.  The six sigma team has five levels of hierarchy

22 What is a BELT?  Belt refers to the level or the position, of a person in an organization at the time of performing a work or at the time of implementation of a project.  There are five “Belt” levels :- 1. Champion 2. Master black belt 3. Black belt 4. Green belt 5. Yellow belt


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