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Conclusion Best Combination “Sweet Spot” Reduce Commute to Work to 15 Minutes (without working an abnormal work schedule) The Goal A Practical Example (The “Cookbook”) 6? Overview 6?.....and Baking Bread YEAST FLOUR Using a 12 Step Process 6? Overview The “BETTER BREAD” Company Step 1.....Selecting “Critical to Quality” (CTQs or Y) What is Important to the Customer? ? Rise ? Texture ? Smell ? Freshness ? Taste Y = Taste!! 6? Overview Measure Step 2.....Defining Performance Standards for CTQs or Y 6? Overview How Could We Measure Taste (Y)? ? Panel of Tasters ? Rating System of 1 to 10 ? Target: Average Rating at 8 ? Desired: No Individual Ratings (“defects”) Below 7 Y = 1 2 3 4 5 6 7 8 9 10 Target Defects Worst Best But.....Is this the Right System? Measure 6? Overview Step 3.....Validating the Measurement System for Y How Could We Approach This? ? Blindfolded Panel Rates Several Loaf Samples ? Put “Repeat” Pieces from Same Loaf in Different Samples ? Consistent Ratings* on Pieces from Same Loaf = “Repeatability” ? Consistent Ratings* on Samples Across the Panel = “Reproducibility” “ Repeatability” “Reproducibility” Suggest Valid Measurement Approach Panel Member Loaf 1 Loaf 2 Loaf 3 A 5 8 9 B 4 9 1 C 4 9 2 D 8 9 8 E 4 8 2 F 5 9 1 G 8 9 2 * Within 177。 The Potential Performance of a Process, Corrected for an OffTarget Mean LSL USL ?? ?? ??Process Mean 181。 T Target A 3? Process ] The Potential Performance of a Process, if it Were on Target 6? Overview Long Term Capability (Cpk) Cp Cpk = Long Term Capability Ratio Example Cp = 1 (previous chart) Target = ??181。6? Overview ? Six Sigma: A Definition Applied to GE GE Quality Initiative Why This Approach? Origin of Six Sigma The “Breakthrough Strategy” Arriving at Sigma ? Six Sigma Structure ? Key Concepts Tools ? A Practical Example An Overview....Not a lot of Details!! 6? Overview “ Six Sigma” ? If we can’t express what we know in the form of numbers, we really don’t know much about it. ? If we don’t know much about it, we can’t control it. ? If we can’t control it, we are at the mercy of chance. Mikel J. Harry President CEO Six Sigma Academy, Inc. A Rigorous Method for Measuring Controlling Our Quality “ ...will bring GE to a whole new level of quality in a fraction of the time it would have taken to climb the learning curve on our own.” John F. Welch, Jr. 1995 GE Annual Report 6? Overview What Does “Sigma” Mean? Sigma is a Measure of the Consistency of a Process It (???is Also the 18th Letter in the Greek Alphabet! Why Does GE Need A Quality Initiative? GE Raising The Bar – New Goal to be “Best in the World” vs. 1 or 2 – Customers are Expecting More, we Must Deliver – “Shipandfix” Approach no Longer Tolerated in the Market – Aim to Speed Past Traditional Competitors in 5 Years – Goal Consistent with Reduced Total Costs We Must Acknowledge Our Vulnerabilities ? Poor Quality That Impacts Customers ? Problems with NPI ? Too High Internal Costs 6? Overview We Need a Major Initiative to Move From Where we Are to Where we Want to be 6? Overview Why Does GE Need A Quality Initiative? 40% 35% 30% 25% 20% 10% 15% 5% Cost of Failure (% of Sales) Defects per Million 233 6210 66,807 308,537 500,000 Sigma 6 5 4 3 2 1 Estimated Cost of Failure in US Industry is 15% of Sales。 Taking GE From a 3? to a 6? Company Will Save ~ $ Billion per Year! Why “Six Sigma”? ? Proven Successful in “QualityDemanding” Industries ., Motorola, Texas Instruments (many process steps in series) ? Proven Method to Reduce Costs ? Highly Quantitative Method – Science and Logic Instead of Gut Feel ? Includes Manufacturing Service (close to customer) and Provides Bridge to Design for Quality Concepts ? Has Support and Commitment of Top Management It Works!!! 6? Overview Sigma 3??4??5??6??Spelling Money Time Misspelled Words per Page in a Book 1 Misspelled Word per 30 Pages in a Book 1 Misspelled Word in a set of Encyclopedias 1 Misspelled Word in all of the Books in a Small Library $ Million Indebtedness per $1 Billion in Assets $570 Indebtedness per $1 Billion in Assets $63,000 Indebtedness per $1 Billion in Assets $2 Indebtedness per $1 Billion in Assets 3 1/2 Months per Century 2 1/2 Days per Century 30 Minutes per Century 6 Seconds per Century 6? is Several Orders of Magnitude Better Than 3?!!! Sigma: A Measure of Quality 6? Overview Where Does “Six Sigma” Come From? ? Mikel J. Harry one of the Original Architects ? Previously Headed Quality Function at ABB and Motorola ? Now President/CEO of Six Sigma Academy in Phoenix, Arizona ? Has Consulted for Texas Instruments, Allied Signal (and others) ? Currently Retained by GE to Teach the Implementation, Deployment and Application of Six Sigma Concepts Tools Learning from Those Who Have had Success With 6??Will Accelerate its Implementation at GE