SIX SIGMA

SIX SIGMA
SIX SIGMA

Hello!!

This is our team

Lean
Six
Sigma
& Case
Study

OUTLINE
S

Tools

History

Definition

Key
Roles

Method
ology

1
History
Without History There Would Be NO
Future

Bill Smith
Father of Six Sigma
[1]

https://www.isixsigma.com/community/awards-and-standards/isixsigmasinaugural-hall-fame-inductee-bill-smith/
[1]


We didnt invent Six Sigmawe learned
it. The cumulative impact on the
companys numbers is not anecdotal,
nor a product of charts. It is the product
of 276,000 people executing and
delivering the result of Six Sigma to our
bottom line
-Jack Welch in 1997

2
Definition
def.i.ni.tion (d-f-n-shn) n.
Meaning of a word ; can be subjective

Definition
A statistical measure of the performance of a
process or a product
A goal that reaches near perfection for
performance
improvement
A system of management to achieve lasting
business leadership and world-class
performance
Pyzdek, Thomas & Paul A. Keller (2009).
The Six Sigma Handbook, Third Edition. New York, NY: McGraw-Hill.

3
Methodolog
y
Methodology is Applied Ideology

Methodology (1) - DMAIC

DEFINE

CONTROL

IMPROVE

SIX
SIGMA
6

MEASUR
E

ANALYZ
E

Pyzdek, Thomas & Paul A. Keller

(2009).
The Six Sigma Handbook, Third Ed
ition
. New York, NY: McGraw-Hill. ISBN

Methodology (2) - DEFINE The

Problem
Typically
include

A business case: Why is this particular opportunity being chosen?

Problem/opportunity and goal statements: Whats the specific
problem or pain being addressed, and what results will be
sought?
Constraints/assumptions: What limitations are placed on the
project or resource expectations being made?
Scope: How much of the process and/or range of issues is in
bounds?
Players and roles: Who are the team members, Champion, and
other stakeholders?
Preliminary plan: When will each phase (D, M, A, I, and C) be
completed?

Methodology (3) MEASURE (1)

The Measure step has two main objectives:
Gather data to validate and to quantify the
problem/opportunity. Usually, this is critical information
to refine and complete the first full project Charter.
Begin teasing out facts and numbers that offer clues about
the causes of the problem.

Methodology (3) MEASURE (2)

A process has three main categories of measures:
Output or Outcome(Y): the end results of the process. Output
measures focus on immediate results (deliveries, defects,
complaints) and outcomes on longer terms impacts (profit,
satisfaction, etc.)
Process: things that can be tracked and measured. These items
usually help the team start to pinpoint causes of the problem.
Input (X): things coming into the process for change into outputs.
Of course, bad inputs can create bad outputs, so input measures
also help identify possible causes of a problem.
Y = f(Xs)

Methodology (3) MEASURE (3)

https://www.google.c
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art+measure&spell=
1&sa=X&ved=0ahUK
Ewjimb7xsojQAhUhR
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AA&dpr=0.95

Methodology (4) ANALYZE

In this step, the DMAIC team delves into the details, enhance its
understanding of the process and problem, and, if all goes as
intended, identifies the culprit behind the problem. The team uses
the Analyze step to find the root cause.
Some of the common cause categories to be explored are
Methods
Machines
Materials
Measures
Mother Nature
People

Methodology (5) IMPROVE

Improve the process to eliminate root causes
The most important parts of implementation, though, are good
planning, good preparation, and good cooperation between all
of the individuals concerned.

Methodology (6) CONTROL

During this Control step, controls are put in place to ensure that the
gains that have been achieved will continue and the problem will not
recur. To do this the following activities need to be carried out,
Design effective quality controls
Foolproof the improvement
Audit the controls.

DMAIC Phase Steps

D Define Phase:Define the project goals and customer (internal and external)
deliverables.
Project Charter
Process Flowchart
SIPOC Diagram
Stakeholder Analysis
DMAIC Work Breakdown Structure
CTQ Definitions
Voice of the Customer Gathering
M Measure Phase:Measure the process to determine current performance; quantify
the problem.
Process Flowchart
Data Collection Plan/Example
Benchmarking
Measurement System Analysis/Gage R&R
Voice of the Customer Gathering
Process Sigma Calculation
A Analyze Phase:Analyze and determine the root cause(s) of the defects.
Histogram
Pareto Chart
Time Series/Run Chart
Scatter Plot
Regression Analysis
Cause and Effect/Fishbone Diagram
5 Whys
Process Map Review and Analysis
Statistical Analysis
Hypothesis Testing(Continuous and Discrete)

I Improve Phase:Improve the process by eliminating defects.

Brainstorming
Mistake Proofing
Design of Experiments
Pugh Matrix
QFD/House of Quality
Failure Modes and Effects Analysis(FMEA)
Simulation Software
C Control Phase:Control future process performance.
Process Sigma Calculation
Control Charts(Variable and Attribute)
Cost Savings Calculations
Control Plan

Methodology (7) - DMADV

DEFINE

VALIDATE

DESIGN

SIX
SIGMA
6

MEASUR
E

ANALYZ
E

Methodology (8) DMAIC vs DMADV

(1)
DMAIC is used, when the problem you want to solve is for a
process that is already existing but not meeting the expected
levels of performance. Alternatively, DMADV is used when you
want to set up/design a whole new process, that should be
meeting the desired level of performance from the beginning.
DMADV and DMAIC are two tools adopted for same mission/vision:
Achieve Six Sigma Performance; Two different approaches and
methodology used to attain a single goal under different
circumstances and problem areas.

http://www.whatissixsigma.net/six-sigma-dmadv/

Methodology (9) DMAIC vs DMADV

(2)

4
Key Roles

Key Role
Sponsor

Senior executive who sponsors the overall Six Sigma initiative.

Leader

Senior-level executive who is responsible for implementing Six Sigma within the business.

Champion

Middle- or senior-level executive who sponsors a specific Six Sigma project, ensuring that resources are
available and cross-functional issues are resolved.

Black Belt

Full-time professional who acts as a team leader on Six Sigma projects. Typically has four to five weeks
of classroom training in methods, statistical tools and sometimes team skills.

Master Black Belt

Highly experienced and successful Black Belt who has managed several projects and is an expert in Six
Sigma methods/tools. Responsible for coaching/mentoring/training Black Belts and for helping the Six
Sigma leader and Champions keep the initiative on track.

Green Belt

Part-time professional who participates on a Black Belt project team or leads smaller projects. Typically
has two weeks of classroom training in methods and basic statistical tools.

Team Member

Professional who has general awareness of Six Sigma (through no formal training) and who brings
relevant experience or expertise to a particular project.

Process Owner

Professional responsible for the business process that is the target of a Six Sigma project.

https://www.isixsigma.com/new-to-six-sigma/roles
responsibilities/six-sigma-roles-and-

5
Tools
The Wrong Tools In The Right Hands Is
FAR BETTER Than The Opposite

Control
Tools
Chart

Stratification

Scatter
Diagram

Histogram

Pareto
Chart

Cause &
Effect
Diagram

Check
Sheet

Pyzdek, Thomas &

Paul A. Keller
(2009).
The Six Sigma Hand
book, Third Editio
n
. New York, NY:
McGraw-Hill. ISBN

6
Lean Six
Sigma &
Case Study

Lean Six Sigma

Essentially, Six Sigma and Lean systems have the same goal.
They both seek to eliminate waste and create the most efficient
system possible, but they take different approaches toward how
achieving this goal. In simplest terms, the main difference
between Lean and Six Sigma is that they identify the root cause
of waste differently.
Lean practitioners believe that waste comes from unnecessary
steps in the production process that do not add value to the
finished product, while Six Sigma proponents assert that waste
results from variation within the process.

Case Study (1) BHP Biliton (1)

The worlds largest diversified resources company
and one of the worlds most respected
organizations (2005 rankings).
A leading supplier of core steelmaking raw
materials.
The worlds second largest copper producer &
exporter of energy coal.
One of the worlds largest producers of nickel
metal, uranium, primary aluminum, oil and gas

Case Study (1) BHP Biliton (2)

Background
1990s BHP went through serious financial turmoil
In addition : lack of a unified culture where many of the operational
functions were not meeting their business imperatives
Over $1.1 billion in write-downs and the loss of four key executives
1999 BHP brought about multiple restructuring moves
The company sold its engineering, power, insurance,and information
tech businesses and began to sell $2 billion worth of steel operations

Case Study (1) BHP Biliton (3)

The Challenge
$1 billion cost reduction target
BHP decided to hire Destra (a strategic business
consulting firm) and adapted Six Sigma in the
company.

Case Study (1) BHP Biliton (4)

Engagement Strategy (1)
To ensure successful deployment, Destra:
Designed and delivered the education and coaching required
to develop senior management team capabilities and
strategies
Integrated the technical (Six Sigma) initiative with change
management deployment practices
Equipped the 30,000 employees with the tools to be
successful

Case Study (1) BHP Biliton (5)

Engagement Strategy (2)
BHP leaders decided to call this world-wide initiative
Operating Excellence(OE) to ensure that those involved felt
part of a larger whole.
OE was rolled out world wide with the initial training sessions
commencing in April 2000.
In 2001, BHP acquired Billiton -a growing, global leader in the
metals and mining sector.

Case Study (1) BHP Biliton (6)

Financial Result
The first year of the OE engagement had these results:
Together, the 108 coaches trained and 115 projects started
saved $65M;
The OE investment was matched by its benefits;
Average project savings was $250K
From 2001 to 2005 there was a total of $424.3M in auditable
savings.

Case Study (1) BHP Biliton (7)

Sample Project Result (Ekati Diamond Mine)
BHP Billiton operates the EKATI diamond mine in Canadas
Northwest Territories, approximately 200 miles northeast of
Yellowknifejust below the Arctic Circle
Improved recoveries at Ekati Diamond Mine saved $29.5M
USD
Reducing the Sort and Valuation cycle time and cutting the
product-to-market time by 2-3 days had a benefit of $2.6 M
USD

http://destraconsulting.com
http://www.qualitydigest.co

Case Study (2) Rio Tinto Aluminium

(1)
Rio
Tinto Aluminium adopted Six Sigma in late 2001 as a
business improvement programme for its bauxite mining,
alumina refining and aluminium smelting business

In 2004, the programme was enhanced by Lean

Manufacturing techniques, boosting the capacity for
workplace-based business improvement. Rio Tinto
Aluminium calls its improvement programme Lean Six
Sigma.

Case Study (2) Rio Tinto Aluminium

(2)
Six
Sigmas data-based decision-making is a fundamental element

of Rio Tinto Aluminiums business model. It encompasses

operations and maintenance in the workplace, project work and
high level enterprise planning. Six Sigma improvement work is
based upon collecting and analysing data , focusing on projects to
reduce variation within work processes .
The Six Sigma organisation within Rio Tinto Aluminium includes
training and support staff and a pool of Six Sigma project leaders
and project specialists (black belts and green belts). The
organisations annual planning process is focused to ensure that
business improvement initiatives support Rio Tinto Aluminium's
corporate vision and objectives

Case Study (2) Rio Tinto Aluminium

Lean(3)
Manufacturing
Rio Tinto Aluminium began integrating Lean philosophies into its
business improvement programme in 2004. Lean Manufacturing
evolved from the earliest efforts to improve mass production and has
become the favoured technique to achieve continuous workplace
improvement in manufacturing and processing industries. Lean is based
on engaging everyone in the organisation in the elimination of waste in
all forms.

Case Study (2) Rio Tinto Aluminium

(4)
Training
Rio Tinto Aluminium's Lean Six Sigma programme trains and accredits
employees as black belts (full-time project leaders), green and yellow
belts (part-time specialists). It also produces Lean coaches and
advisers. At the end of 2004, 600 Rio Tinto Aluminium employees had
received Six Sigma training.

Case Study (2) Rio Tinto Aluminium

(5)
Results
In 2004, Six Sigma projects delivered A$29 million value to Rio Tinto
Aluminium's businesses against a target of A$24 million. At any time,
Rio Tinto Aluminium has more than 20 active black belts, around 25
active green belts, plus Lean coaches and advisers. The business
improvement organisation includes business improvement managers,
training facilitators and activity co-ordinators.

http://sales.riotintoaluminium.com/freedom.aspx?pid=203

Conclusion
Six sigma is method that focuses on the
processes and the prevention of defects
(Snee, 1999).
Defect Prevention is done by reducing the
variations that exist in every process by
using statistical techniques that are well
known in general. (7QC)


Through our Operating Excellence initiative and other cost
savings opportunities weve achieved US $780 million of
efficiency gains over the last three years. By institutionalising
our methodology through the organisation, we create a
sustainable base from which to continue to find efficiencies to
improve the overall performance of our businesses.
Chip Goodyear, CEO, BHP Billiton 2004

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