Introduction

to
Six Sigma

Genesis
Six Sigma:
Six Sigma:An
An overview
overview
What
is Sigma
and Six Sigma?
What
is Six
Sigma
Why Six Sigma?
Six Sigmafocus
Levels
Six Sigma
Six Sigma Methodology and
Six Sigma
Scale
Management
Key RolesCompanies
for Six Sigma
Six Sigma
Tools for Six Sigma
Trainingsand
Certifications
Six Sigma
The
statistical
Conclusion
background
DMAIC/DMADV
Benefits

GENESIS
Motorola in early 80s
Mikel Harry formalized the process for targeting the
inputs to the quality problems rather than the
outputs of the those problems
Input oriented approach leads to: A problem
solving methodology and a set of tools to manage
the problems
Adapted gradually by other Fortune 500 Co.
Another very famous proponent Jack Welch (GE)
Its had evolved to mean different things to different
people, sometimes any QI improvement process is
also termed as SS

Six Sigma Companies

Six Sigma and Financial Services

Six 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.
Six Sigma - A highly disciplined process that
enables organizations deliver nearly perfect
products and services.
A rigorous, data based problems solving
approach to improving the performance of an
organization
DMAIC / DMADV Cycle

Six Sigma
A performance goal, representing 3.4
defects for every million opportunities to
make one.
A series of tools and methods used to
improve or design products, processes,
and/or services.
A statistical measure indicating the
number of standard deviations within
customer expectations.
A disciplined, fact-based approach to
managing a business and its processes.
A means to promote greater awareness of
customer
needs,
performance

Six Sigma
Six Sigma can be defined as a specific methodology to
develop and implement quality improvements in an
organizations critical processes by rigorously measuring
and analyzing and identifying variations from customer
specifications in those processes and improving them or
designing entirely new processes to keep variations at an
acceptable level and sustaining and institutionalizing or
verifying the improvements for future as well.

Six Sigma
CTQ/CTC/CTD:
Attributes
which
are
important to customers
Defect: Failing to deliver what the
customers wants
Process Capability: What your process can
deliver
Variation: What the customers see and
feels
Stable Operations: Ensuring consistent,
stable processes
DFSS: Designing to meet customers needs

Six Sigma Focus is on

Defining users requirements

Aligning processes to meet those requirements
Using metrics to minimize the variations
Rapidly and permanently improve the process
(Try and incorporate the best of the options in
process)
Sustain and hold on to the improvement
achieved
(Check the design for its use, usability &
performance)
10

Sigma Scale
In a world at 6 Sigma
In a world at 3 Sigma
There are 964 U.S.
flight cancellations
per day.
The police make 7
false arrests every 4
minutes.
In MA, 5,390
newborns are
dropped each year.
In one hour, 47,283
international long
distance calls are
accidentally

1 U.S. flight is
cancelled every 3
weeks.
There are fewer than
4 false arrests per
month.
1 newborn is
dropped every 4
years in MA.
It would take more
than
2 years to see the
same number of
dropped
international calls.

Statistical Background
Some Key measure

Target =

Statistical Background
Control limits

Target =

Statistical Background
Required Tolerance
LSL

Target =

USL

Statistical Background
Tolerance
LSL

Target =

Six-Sigma

USL

Statistical Background
Tolerance
LSL

USL

1350
ppm

1350
ppm

Target =

Statistical Background
Tolerance
LSL

0.001
ppm

USL

1350
ppm

1350
ppm

Target =

0.001
ppm

Statistical Background
Tolerance
LSL

0 ppm

USL

3.4
ppm

66803
ppm

3.4
ppm

Statistical Background
Six-Sigma allows for un-foreseen
problems and longer term issues
when calculating failure error or rework rates
Allows for a process shift
So what constitutes an acceptable
level of quality for any business?
While a 4 sigma is acceptable for
restaurants but then for a hospital
medication process this seems to be

DPMO or PPM Table

Managing Up the Sigma

Scale
Sigma
1
2
3
4
5
6

% Good % Bad

DPMO

30.9%

69.1%

691,462

69.1%

30.9%

308,538

93.3%

6.7%

66,807

99.38%

0.62%

6,210

99.977%

0.023%

233

99.9997% 0.00034%

3.4

Performance Standards

PPM

Yield

2
3
4
5
6

308537
66807
6210
233
3.4

69.1%
93.3%
99.38%
99.977%
99.9997%

Process
Process
performance
performance

Defects
Defectsper
per
million
million

Long
Longterm
term
yield
yield

Current
Currentstandard
standard

World
WorldClass
Class

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.
24

Six-Sigma - A Roadmap for Improvement

Define

Determine purpose and scope of project

Measure

Collect info which indicates process perf.

Analyze

Rship betn key process input variables

Improve

Expt. inputs variables to get right outputs

Control

Std. & sustain change for improvements

DMAIC

DMAIC
Define

The Improvement Methodology

Measure Analyze Improve Control

Objective:
DEFINE the
opportunity

Objective:
Objective:
MEASURE current ANALYZE the
performance
root causes of
problems

Objective:
IMPROVE the
process to
eliminate root
causes

Objective:
CONTROL the
process
to sustain the gains.

Key Define Tools:

Cost of Poor
Quality (COPQ)
Voice of the
Stakeholder
(VOS)
Project Charter
As-Is Process
Map(s)
Primary Metric
(Y)

Key Measure
Tools:
Critical to Quality
Requirements
(CTQs)
Sample Plan
Capability
Analysis
Failure Modes
and Effect
Analysis (FMEA)

Key Improve
Tools:
Solution
Selection Matrix
To-Be Process
Map(s)

Key Control
Tools:
Control Charts
Contingency
and/or Action
Plan(s)

Key Analyze
Tools:
Histograms,
Boxplots, MultiVari Charts, etc.
Hypothesis Tests
Regression
Analysis

Define DMAIC Project

What is the project?
$

Project
Charter

Cost of
Poor
Quality

S ta k e h o ld e r s

Voice of
the
Stakeholde
r

Six Sigma
What is the problem? The problem is the
Output
(a Y in a math equation Y =
f(x1,x2,x3) etc).
What is the cost of this problem
Who are the stake holders / decision makers
Align resources and expectations

Define Customer Requirements

What are the CTQs? What motivates the customer?

Listening
Posts

Industry
Intel

SECONDARY RESEARCH

Market
Data

Customer
Service

Industry
Benchmarking

Customer
Correspondence

PRIMARY RESEARCH
Surve
ysSurve
ys

OTM

Focus Groups

Observations

Voice of the Customer

Key Customer Issue

Critical to Quality

Measure Baselines and Capability

What is our current level of performance?

Sample some data / not all data

Current Process actuals
measured against the Customer
expectation
What is the chance that we will
succeed at this level every time?

Descriptive Statistics
Variable: 2003 Output
Anderson-Darling Normality Test
A-Squared:
P-Value:

10

20

30

40

50

95% Confidence Interval for Mu

Pareto Chart for Txfr Defects

Mean
StDev
Variance
Skewness
Kurtosis
N

23.1692
10.2152
104.349
0.238483
0.240771
100

Minimum
1st Quartile
Median
3rd Quartile
Maximum

0.2156
16.4134
23.1475
29.6100
55.2907

95% Confidence Interval for Mu

21.1423
19.5

100

20.5

21.5

22.5

23.5

24.5

95% Confidence Interval for Median

60
40
20
0

Defect
Count
Percent
Cum %

79
79.0
79.0

17
17.0
96.0

4
4.0
100.0

Percent

Count

80

50

25.5

26.5

25.1961

95% Confidence Interval for Sigma

8.9690

100

0.211
0.854

11.8667

95% Confidence Interval for Median

19.7313

26.0572

Analyze Potential Root Causes

What affects our process?
Ishikawa
Diagram
(Fishbone)

Six Sigma

y = f (x1, x2, x3 . . . xn)

Analyze Validated Root Causes

What are the key root causes?
Pareto Chart for Txfr Defects
100

100

60
40

Percent

Count

80

50

20
0

E x p e r im e n ta l D e s ig n

Defect
Count
Percent
Cum %

79
79.0
79.0

Data
Stratificatio
n

17
17.0
96.0

4
4.0
100.0

Regression
Analysis

Pareto Chart for Amt Defects

100

15

60

10

40
5
20
0

Percent

Count

80

Process
Simulatio
n

Defect
Count
Percent
Cum %

12
70.6
70.6

3
17.6
88.2

2
11.8
100.0

Six Sigma

y = f (x1, x2, x3 . . . xn)

Critical Xs

Improve Potential Solutions

How can we address the root causes we identified?

Address the causes, not the

symptoms.
Evaluat
e

Clarify

Generat
e

y = f (x1, x2, x3 . . . xn)

Critical Xs

Divergent | Convergent

Decision

Improve Solution Selection

How do we choose the best solution?
Solution Selection Matrix
Qualit
y

Time

Solution

Sigma

Cost

Six Sigma
Implementation
Bad
Good

Solution
Right
Wrong

Nice
Try

Nice
Idea

Solution
Implementatio
n Plan

Time

CBA

Other

Score

Control Sustainable Benefits

How do we hold the gains of our new process?

Some variation is normal and OK

How High and Low can an X go yet not materially impact
the Y
Pre-plan approach for control exceptions

35
UCL=33.48

Individual Value

25

Mean=24.35

LCL=15.21

15
0

10

20

Observation Number

30

Six Sigma
Six Sigma can be defined as a specific
methodology

to

develop

and

implement

quality improvements in an organizations

critical processes by rigorously measuring
and analyzing and identifying variations from
customer specifications in those processes
and improving them or designing entirely
new processes to keep variations at an
acceptable

level

and

sustaining

and

BENEFITS OF SIX SIGMA

Generates sustained success

Sets performance goal for everyone
Enhances value for customers
Accelerates rate of improvement
Promotes learning across boundaries
Executes strategic change

36

SIX SIGMA PERFORMANCE MEASURES

TOP: Total number Of Opportunities
DPU: Defect Per Unit
DPO: Defect Per Opportunity
DPMO: Defects Per Million Opportunities
PPM: Parts Per Million
RTY/FPY: Rolled Throughput Yield or First Pass
Yield

TOP
TOP: Total number Of Opportunity: In any given product
or service, this refers to the total number of defect
opportunities possible.
TOP = TOTAL NUMBER OF OPPORTUNITY = NUMBER OF
SAMPLE UNITS INSPECTED * OPPORTUNITY PER UNIT
For example: If there are 10 columns/spaces in a form to
be filled then, we can say in each form there the TOP =
10 per form, so if we are inspecting 100 forms then the
TOP = 10 * 100 = 1000 number of opportunities.

DPU
DPU: Defect Per Unit: Average number of defects
per unit. Numerically it is the ratio between the
total number of defects found in a sample to the
total number of samples inspected.
DPU = DEFECT PER UNIT = NUMBER OF DEFECTS
IN A SAMPLE / NUMBER OF SAMPLE INSPECTED
For example: If we had inspecting 100 forms and
found that there are 140 defects (mistakes) in all
the forms inspected then the
DPU = 140/100 = 1.4 defects per unit

DPO
DPO: Defect Per Opportunity: Average number of defects per opportunity.
This is the ratio of total number of defects found in a sample with the
total number of defect opportunities available in the sample.
DPO = DEFECT PER OPPORTUNITY = TOTAL NUMBER OF DEFECTS
DETECTED IN A SAMPLE / TOTAL NUMBER OF DEFECT OPPORTUNITIES IN
THE SAMPLE
DPO = TOTAL NUMBER OF DEFECTS DETECTED IN A SAMPLE / (SAMPLE
INSPECTED * NUMBER OF DEFECT OPPORTUNITIES PER UNIT IN THE
SAMPLE)

DPO = TOTAL NUMEBR OF DEFECTS DETECTED IN A SAMPLE / TOP

For example: If we had inspecting 100 forms and there are 10 fields of
information i.e. opportunities to make errors. If only 15 forms are
sampled/inspected and 25 defects are found, then the
DPO = 25 / (10*15) = 25/150 = 0.166667 defects per opportunity

DPMO

DPMO: Defects Per Million Opportunities: Ratio of total number of defects

in one million opportunities when an item can contain more than one
defect. (This pertains to defects). This is the ratio of total number of
defects found in a sample in one million opportunities.

DPMO = DEFECT PER MILLION OPPORTUNITIES = TOTAL NUMBER OF

DEFECTS DETECTED IN A SAMPLE * ONE MILLION / TOTAL NUMBER OF
DEFECT OPPORTUNITIES
DPMO = TOTAL NUMBER OF DEFECTS DETECTED IN A SAMPLE * ONE
MILLION / (SAMPLE INSPECTED * NUMBER OF DEFECT OPPORTUNITIES
PER UNIT IN THE SAMPLE)
DPMO = TOTAL NUMEBR OF DEFECTS DETECTED IN A SAMPLE *
10,00,000 / TOP

For example: If in a form, there are 10 fields of information i.e.

opportunities to make errors. If only 15 forms are sampled/inspected and
25 defects are found, then the
DPMO = 25 * 1000000 / (10*15) = 25 * 1000000 /150 = 166666.7 defect
per million opportunity

PPM
PPM: Parts Per Million: The number of defective units in one
million units. Usually, preferred when the fraction defective
figures are too small to consider in normal circumstances.
(This pertains to defectives).
PPM = PARTS PER MILLION = TOTAL NUMBER OF DEFECTIVE
UNITS DETECTED IN SAMPLE * 10,00,000/ NUMBER OF
SAMPLES INSPECTED
For example: If we had inspected 100 forms and there was
100% inspection done and 25 forms were found to be
unacceptable, then the
PPM = 25 * 1000000 / 100 = 250000 parts per million
defective

RTY/FPY

RTY/FPY: Rolled Throughput Yield or First Pass Yield: It is the

probability (or the percentage chances) that a process will complete
all required steps without any failures. The computations of RTY is
based on reliability principle.

Reliability of a system in series with n steps in the process =

R1*R2*R3.Rn
Where, R is the reliability of each process from 1 to n.

Similarly, yield of any process is the product of yield at every stage

when quality is the performance metric: RTY = FPY = Y1 * Y2 * Y3
*.Yn ,Where, Y is the yield (proportion accepted/good) for each step
in a n step process

For example: In a three step process, the yield rate of different step
is as: Step 1=0.97, Step 2=0.92 and Step 3=0.95. Then the RTY =
0.97 * 0.92 * 0.95 = 0.8478 It means that only 84.78% of the units
completed through all this three step process will make it through
without needing any repair work.

RTY & DPU

RTY = e
98.35%

DPU

=e

- 0.01666667

= 0.9835 =

The yield of a certain process is known

and is around 0.836. Find DPU.
RTY = 0.836
RTY = e DPU
Therefore, DPU = - Logn (RTY) = - Logn
(0.836) = 0.179127

OPPO
RTUNI DPU
DEFE UNITS
TIES/
=
CTS
OF
UNIT DEFE
OR
PROD
OF
CTS
REJEC UCTIO
PROD PER
TS
N
UCTIO UNITS
N

10

200

15

50

10

80

50

DPO =
DEFECT
S/
(UNITS*
OPPORT
UNITY/U
NIT)

SIGM
A
DPM SHOR
O=
T
DPO TERM
=
*
MILLI ABS(
ON NORM
SINV(
DPO))

SIGM RTY =
A
E TO
LONG THE
TERM POWE
=
R
SSST MINU
+ 1.5 S DPU

DPU
FROM
RTY =
MINU
S LN
(RTY)

OPPO
RTUNI DPU
DEFE UNITS
TIES/
=
CTS
OF
UNIT DEFE
OR
PROD
OF
CTS
REJEC UCTIO
PROD PER
TS
N
UCTIO UNITS
N

DPO =
DEFECT
S/
(UNITS*
OPPORT
UNITY/U
NIT)

SIGM
A
DPM SHOR
O=
T
DPO TERM
=
*
MILLI ABS(
ON NORM
SINV(
DPO))

SIGM RTY =
A
E TO
LONG THE
TERM POWE
=
R
SSST MINU
+ 1.5 S DPU

DPU
FROM
RTY =
MINU
S LN
(RTY)

0.951
2

0.05

0.740
8

0.3

0.201
20000
0.841 2.341
0
8

1.6

10

200

0.05

0.01

10000 2.326 3.826

15

50

10

0.3

0.03

30000 1.880 3.380

80

50

1.6

0.2

THANK YOU