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Failure (% of Sales)Defects per Million 233 6210 66,807 308,537 500,000Sigma 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 ManagementIt Works!!!6? Overview Sigma3?4?5?6?Spelling Money Time Misspelled Wordsper Page in a Book1 Misspelled Wordper 30 Pages in a Book1 Misspelled Word ina set of Encyclopedias1 Misspelled Word in allof the Books in a SmallLibrary$ Million Indebtednessper $1 Billion in Assets$570 Indebtednessper $1 Billion in Assets$63,000 Indebtednessper $1 Billion in Assets$2 Indebtednessper $1 Billion in Assets3 1/2 Monthsper Century2 1/2 Daysper Century30 Minutesper Century6 Secondsper Century6? is Several Orders of Magnitude Better Than 3?!!!Sigma: A Measure of Quality6? 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 SuccessWith 6?? Will Accelerate its Implementation at GE6? Overview So...What is Six Sigma?? A Measurement System? A ProblemSolving Approach? A Disciplined Change Process“THE SIX SIGMA BREAKTHROUGH STRATEGY”Measure Analyze Improve Control6? Overview How Do We Arrive at Sigma?Measuring Eliminating Defects is the “Core” of Six SigmaMeasurement SystemIdentify the CTQs Look for Defectsin Products orServices? “Critical to Quality” Characteristics or the Customer Requirements for a Product or Service ? Count Defects or failures to meet CTQ requirements in all process steps Define DefectOpportunities? Any step in the process where a Defect could occur in a CTQ Arrive at DPMO? Use the SIGMA TABLEConvert DPMO toSigma? Defects Per Million Opportunities23456308,537 66,807 6,210 233 PPM? Defects per Million of Opportunity Sigma Level6? Overview Measurement System23456308,537 66,807 6,210 233 PPM SIGMA LEVEL DEFECTS per MILLIONOPPORTUNITY? IRS Tax AdviceBest CompaniesAirline SafetyAverage CompanyGEAirline BaggageDoctor’s PrescriptionRestaurant Bills{ { { { Average Company in 3? to 4?? Range Some Sigma “Benchmarks” 6? Overview Measurement SystemA Graphic/Quantitative Perspective on VariationAverage ValueMany Data Sets Have a Normal or Bell ShapeNumber ofPeopleArrivingat CRDTime7:00 7:15 7:30 7:45 8:00 8:15 8:30 8:45 9:00 9:156? Overview Problem Solving ApproachCenterProcessReduceSpreadXX XXXXX XXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXX XXXOffTarget UnpredictableOnTarget 6??? Helps us Identify and Reduce VARIATION due to: Insufficient Process Capability Unstable Parts Materials Inadequate Design MarginTargetUSLLSLTargetUSLLSLTargetUSLLSLCenterProcessReduceSpreadOffTarget UnpredictableOnTargetDefects6? Overview Problem Solving Approach“Lower Specification Limit” “Upper Specification Limit”Less Variation Means Fewer Defects Higher Process Yields 6? Overview Problem Solving A