Objectives of Six Sigma

Objectives of Six Sigma
Y=f(X)
Y refers to strategic goals, customer requirements, profits, Customer satisfaction, Overall business efficiency etc.
X refers to Essential actions refers to achieve strategic goals. Process variables, other inputs.
To figure out which of the Xs or variables in the business process and inputs have the biggest influence on the Ys or results.
To use the changes in the overall performance of the process (The Ys as well as other factors)
to adjust the business and keep it moving on a profitable path

Six Sigma’s hidden truths

• Six Sigma encompasses a broad array of business best practices and skills that are essential ingredients for success and growth. It can be applied to many different business activities and challenges – from strategic planning to operations to customer service-and maximize the impact of your efforts.
• There are many “Six Sigma ways”. Following a fixed prescription set by another company is guaranteed to fail. The benefits of six Sigma will be accessible whether to lead entire organization or a department.
• The potential gains of Six Sigma are equally significant in services organizations and non – manufacturing organizations as they are in technical environment.
• Six Sigma is much about people excellence as it is about technical excellence, Creativity, collaboration, communication, dedication are infinitely more powerful than a corps of super statisticians.
• Six Sigma improvement are thrilling and rewarding. Six Sigma results in more intangible gains than the resulting significant financial gains. Brings positive attitude change.

Six Themes of Six Sigma

• Genuine focus on the customer. Customer focus is too priority. Measures of Six Sigma performance begins with the customer satisfaction and value.
• Data and Fact-Driven Management. Six Sigma is management by Fact. No options and assumptions. What data/information do i really need? How do we use data/information to maximum benefit?
• Process focus, Management, and Improvement. In Six Sigma, process are where the action is. Whether designing products or services, measuring performance, improving efficiency and customer satisfaction-or even running business Six-Sigma positions the process as key vehicle of success.
• Proactive Management. Six Sigma encompasses tools and practices that replace reactive habits with a dynamic. responsive, proactive style of management. Today’s slim-margin-for-error competitive environment, being proactive is *only way to fly.
• Boundary Less Collaboration. Six Sigma requires breaking down of barriers and improves team work. up. down. and across organizational lines. Six Sigma expands opportunities for collaboration as people learn how their roles fit into the Big Picture* and can recognize and measure independence of activities in all parts of a process. Six Sigma Systems can create an environment and management structures that supports true team work.
• Drive for perfection, tolerance for failure, it is contradictory? No company will get anywhere close to Six Sigma without launching new ideas and approaches-which always involve some risk, if people who see a possible path to better service, lower costs. new capabilities, etc are too afraid of the consequences of mistakes, they will never try.

Six Sigma Roadmap

The roadmap is the path to Six Sigma improvement and it explains the steps needed to achieve the same.

Step-1. Identify core process and key customers

As business becomes ever more dispersed and global, customer segments more narrow, and products and services more diverse, it gets tougher to see big picture of how the work actually gets done. By taking step one, the big picture can be brought into clearer focus by defining critical activities and getting grasp of board structure of business systems.

Objectives, to create a clear, “Big-picture” understanding of the most critical cross-functional activities of the organization, and how they interface with external customers.

Deliverables: A “map” or inventory of value delivering activities of organization, driven by three questions.

• What are our core or value adding processes?
• What products and. or services do we provide to our customer?
• How due process “flow” across the organization?

The objectives described are applicable to entire organization or any segment of it. Even a department or a function that serves internal customers-Human resources, information technology, or facilities, for examples-has its own “core Processes” that deliver products, services, and value to customers.

Step Two. Define customer requirements
One discovery often admitted by business leader and managers, after embarking on six sigma is that, “we did not understand our customer very well”. Getting good customer input may be the most challenging aspect of the Six Sigma approach.

Objectives:

• To establish standard for performance based on the actual customer input, so that process effectiveness/capability can be accurately measured-and customer satisfaction predicted.
• To develop or enhance systems and strategies devoted to ongoing “Voice of the customer” data gathering.

Deliverables
A clear complete description of the factors that drive customer satisfaction for each output and process- “requirements” or “specifications” in two key categories.

• “Output requirements” tied to the end product or service or service that makes it work for the customer (what quality gurus have called “fitness for the use”).
• “Service requirements” describing how the organizations should interact with the
  customer.

Step Three, Measure current performance
While step two defines what customer want, step three looks into how well organization is delivering on those requirements today-and how likely to do so in future. On a broader level, performance measures focused on the customer serve as the starting point for establishing a more effective measurement system.
Objectives, To accurately evaluate each process’s performance against definable customer requirements, and to establish a system for measuring key outputs and services
features.
Deliverables:

• Baseline measures-quantified evaluations of current/recent process performance.
• Compatibility measures-assessment of the ability of the current process/output to deliver on requirements. These include Sigma” scores for each process that allow comparison of very different process.
• Measurement systems-new or enhance methods and resource for ongoing measurement against customer-focused performance standards.

There are several benefits of step three:

• Creating a measurement infrastructure- This gives a power to follow changes in performance-good or bad to respond promptly to warning signs and opportunities. Over time, these data become key inputs to the responsive, always-improving Six Sigma Organizations.
• Setting priorities and focusing resource-Even in the short term, knowledge derived from these measures drives decisions as to where to make the most urgent and/or high – potential improvements. The impact is a higher return on investment for process design, redesign, or improvement projects.
• Selecting the best improvement strategies-having accurate process capability measures allows organization to gauge the real nature or performance issues, are they occasional problems or minor issues, or situations implicitly demanding that an entire product line or process be revamped?
• Matching commitments and capabilities – Ever hear salespeople wonder in frustration, “How come we cannot do this for the customer?” or people in operations complaining about Impossible commitment made by sales force? Better communication alone won’t resolve these disconnects, which in many business are some of the most challenging and costly. Organizations need to have the added advantages of the knowledge gained through Six Sigma methods-both about what in we lie want and what organizations can really deliver.

Step Four. Priorities, analyze, and implement improvement
Now organization is equipped with facts and measures, to start cashing in on the real payoff the Six Sigma

Objectives: To identify high-potential improvement opportunities and develop process-oriented solutions supported by factual analysis and creative thinking. Also to effectively implement new solutions and processes and provide measurable, sustainable gains.

Deliverables:

• Improvement priorities, potential Six Sigma projects assessed based on their impact and feasibility.
• Process improvements. solutions targeted to specify root causes (continues and incremental improvements)
• New or redesigned process, new activities or workflows created to meet new demands, incorporate new technologies, or achieve dramatic increase in speed, accuracy, cost performance, etc. (Six Sigma Design or Business Process redesign)

Step Five, Expand and integrate the Six Sigma System
Real Six Sigma performance will not come to you through the wave of improvement projects-it can be achieved only through a lone-term commitment to the core themes and methods of
Six Sigma.

Objectives: to initiate ongoing business practices that drive improved performance and ensure constant measurement, reexaminations, and renewal of products, services, processes, and procedures.

Deliverables:

• Process controls. Measures and monitoring. to sustain performance improvement.
• Process ownership and management. Cross Functional oversight of support processes. with input from voice of customer, voice of market, voice of employee and process measurements.
• Response plan. Mechanism to act based on key information so as to adapt strategies, products/services, and processes.
• Six Sigma Culture: An organizations positions for continuous renewal, with Six Sigma themes and tools and essential part of the everyday business environment.

Sig Sigma from a Cost/Benefit Perspective
Many executives and managers often wonder “exactly what is Six Sigma to cost, and what kind of return can we expect it to bring to us?

Estimating Potential benefits
Organizations can most accurately defines possible dollar gains from Six Sigma by evaluating the costs of rework, inefficiency, unhappy or lost customers, and soon, and then estimating the amount by which they can reduce them. For example, if you have developed measures of defects per million opportunities (DPMO), you would determine the average cost of each defect (taking into consideration people, material, and other factors) and the total savings for and X percent defect reduction, the more specifically you can define these numbers, called ‘costs of poor quality” pr COPQ”, the more accurate will your estimate be.

The Cost of Six Sigma implementation
Tapping in to the potential gains organizations has identified will demand and upfront investment, which means that if organizations cannot clear some budget from a Six Sigma start-up effort, it cannot achieve any gains.

Some of the most important Six Sigma items can include the following.

• Direct payroll. Individual dedicated to the effort full time.
• Indirect Payroll. The time devoted by executives, team members, process owners and others such to such activities as measurements, voice of the customer data gathering and improvement projects.
• Training and consulting. Teaching people Six Sigma skills and getting advice on how to make the efforts successful can be significant investment.
• Improvement implementation. Expenses to install new solutions or process designs can range from few thousand dollars to million especially for IT driven solutions.

Other expenses can add up include travel and lodging, facilities for training and office and meeting space for teams.

Key factors in Six Sigma Projects selection
Financial return, as measured by costs associated with quality and process performance, and impacts on revenues and market share
Impacts on customer and organizational effectiveness
Probability of success
Impact on employees
Fit to strategy and competitive advantage

Six Sigma Quality” DMAIC Cycle
1. Define
2. Measure
3. Analyze
4. Improve
5. Control

Define
Describe the problem in operational terms
Drill down to a specific problem statement (Project scoping)
Identify customers and CTs. performance metrics, and cost/revenue implications

Measure
Key data collection question
What question are we trying to answer?
What type of data will we need to answer the question?
Where can we find the data?
Who can provide the data?
How can we collect the data with minimum effort and with minimum chance of error?

Analyze
Focus on why defects, error, or excessive carination occur
Seek the root cause
5- why technique
Experimentation and verification

Improve
Idea generation
Brainstorming
Evaluation and selection
Implementation planning

Control
Maintain improvements
Standard operating procedures
Training checklist or reviews
Statistical process control charts

Roles in Six Sigma organization
The Leadership group or council
It is “six Sigma leadership Team or “Quality council” which consists of top management team.

Functions of this team include

• Establishing the roles and infrastructure of the Six Sigma initiative
• Selecting specific projects and allocating resource.
• Periodically reviewing the progress of various projects, and offering ideas and he
• Serving to ‘Sponsors” of Six Sigma projects.
• Helping to quantify the impact of Six Sigma efforts on the company bottom-line.
• Assessing progress, and identifying strengths and weakness in the effort.
• Sharing best practices throughout the organization-and with key suppliers customer, where appropriate.
• Acting as ‘Road Block removers” when team identify seeming barriers.
• Applying the lessons learned to their own individual management styles.

The ‘Sponsor” or “champion”
A sponsor is the senior manager who oversees an improvement projects, this is a critical responsibility that can require a delicate balance. Teams need the freedom to make their own decisions, but they also need guidance from business leaders on the direction of their efforts
Sponsors responsibilities include

• Settings and maintaining broad goals for improvements projects under his or her charge- including creating the project rationale-and ensuring that they are aligned with business priorities.
• Caching on, and approving changes in, direction or scope of a project, if needed.
• Finding resources for a project.
• Representing the team to the leadership group and serving as its advocate.
• Helping to smooth out issues and overlaps that arise between teams, or with people outside the team.
• Working with process owners to ensure a smooth handoff at the conclusion of an improvement project.
• Applying their gained knowledge of process improvement to their own management tasks

The Implementation leader
The implementation leader or Six Sigma director is needed to handle following tasks.

• Support the leadership group in its activities, including communications, project selection, and project reviews.
• Identifying and/or recommending individuals/groups to fulfill key roles-including external consulting and training support.
• Preparing and executing training plans. including curriculum selection and scheduling and logistics.
• Helping sponsors fulfill their role as supporters, and advocates.
• Documenting overall progress and surfacing issues that need attention.
• Executing the internal marketing plan for the initiative.

The Six Sigma Coach
The coach provides expert advice and assistance to process owners and six Sigma improvement teams, in the areas that may range from statistics to change management to process design strategies. The coach is technical expert. though the level of expertise varies from business to business based on hoe the roles are structured and the level of complexity of the problems. He can consultant. His responsibilities may include.

• Communicating with the project sponsor and leadership group.
• Establishing and sticking to a firm schedule for the project.
• Dealing with resistance or lack of cooperation from people in the organization.
• Estimating potential, and validating actual results.
• Resolving team member disagreements, conflicts etc.
• Gathering and analyzing data about team activities.
• Helping teams promote and celebrate their success.

The team leader or project leader
Team leader is individual who takes primary responsibility for the work and the results of a
Six Sigma project. Responsibilities include.

• Reviewing/clarifying the project rationale with sponsor.
• Developing and updating the project charter and implementation plan.
• Selecting or helping to select project team members.
• Identifying and seeking resources and information.
• Defining and helping others in the use of appropriate Six Sigma tools-as-wells team and meeting management techniques.
• Maintaining project schedule and keeping progress moving towards final solution and results.
• Supporting the transfer of new solutions or processes to ongoing operations, while working with functional managers and/or the process owner.
• Documenting final results and creating storyboard of the project.

Team Leader
Most organization use teams as the vehicle for the bulk of their improvement efforts. The team members provide the extra brains and muscle behind the measurements, analysis, and improvement of a process. They also help spread the word about Six Sigma tools and processes and become part of the bench strength for future projects.

The Process Owner
This is the person who takes on a new cross functional responsibility to manage and end-to-end set of steps that provide value to an internal or external customer. He or she received the handoff from improvement teams, or becomes owner of new and newly designed processes.

Master Black Belts. Fully quality leaders responsible for six Sigma Strategy, training. mentoring, deployments and results;
Black Belts. Fully trained Six Sigma experts who lead improvement teams, work on six Sigma projects and mentor Green belts;
Green Belts. Fully trained individual who apply six Sigma to improvement projects.
Team members. (Yellow Belts) individual who support projects in their areas.

Quality Function Deployment

• Product design process using cross-fictional teams
• Marketing. engineering, manufacturing
• Translates customer preference into specific product characteristics
• Involves creating 4 tabular ‘Matrices’ or Houses
• Breakdown product design into increasing levels of details

To Build House of Quality

• Identify customer wants
• Identify how the good/service will satisfy customer wants.
• Relate the customer’s wants to the products hows.
• Identify relation between the firm’s hows.
• Develop importance ratings
• Evaluate completing producing

Potential Benefits of Six Sigma

• Generated sustained success
• Sets a performance goal for everyone
• Ensure and enhance values to the customers
• Accelerates the rate of improvement
• Promoted learning and cross pollination
• Executed strategic change