Six Sigma
Six Sigma
Six Sigma
Thus variation has a significant monetary impact on the working of the organization. This is because it is
the root cause of process deficiencies and dissatisfied customers. It is for this reason that top
management of various organizations of the world have systematically tried to remove variation from their
processes.
Here is how minor defects in each of these processes are capable of leaving customers thoroughly
dissatisfied and enraged. Let’s assume that each of these processes has a 97% efficiency. Therefore out
of a 100 cases, only 3 defects will be present. Here is what happens:
Total Number of defects for the hotel: 0.97 × 0.97 × 0.97 × 0.97 = 0.8852 = 88.52%
Hence even though each of the processes may be doing pretty well if you look at it from an individual
standpoint, the organization is doing badly. Any business where roughly 12% of the customers will have
bad experiences predictably cannot be expected to survive for long.
The answer to this challenge that variation poses can be found only in Six Sigma. Six Sigma achieves for
99.99966% accuracy meaning 3.4 defects per million.
Six Sigma processes are completely driven from the point of view of the customer. They start by
identifying what is important to the customer i.e the critical to quality metrics. The next step is to identify
the gaps in the process that are the cause of not being able to meet the CTQ’s and as a result causing
immense customer dissatisfaction.
The usage of Six Sigma has grown by leaps and bounds. Today almost every major organization in the
world is following Six Sigma initiatives and making their processes more controlled and more predictable.
In other words, it is a methodology to achieve 3.4 defects per million opportunities. It can also be used to
bring breakthrough improvements in the process. It focuses on the bottom-line and is a proven
methodology for problem solving.
To reduce variation
To reduce defects /rework
To improve yield /productivity
To enhance customer satisfaction
To improve the bottom-line
To improve top-line
Shortening cycle-time
2 Sigma 308537
3 Sigma 66807
4 Sigma 6210
5 Sigma 233
6 Sigma 3.4
In the year 1980, Motorola started facing survival problems due fierce competition from Japanese
companies. The CEO of Motorola - Bob Galvin was determined to overcome the competition. He
challenged his organization to achieve a ten-fold improvement in performance over a period of five years.
To achieve the same, strong emphasis was given to training of employees and also performing global
benchmarking.
Bill Smith was a veteran engineer in Motorola and he wrote a research paper on product quality and its
performance after delivery to customer. In his report he discovered that the products with fewer non-
conformities (high quality) were the ones that performed well after delivery to the customer. It was
accepted by everyone but the challenge that came in front of Motorola executives was to develop a
solution to tackle this problem.
Mikel Harry having a doctorate from Arizona University worked with Bill Smith in developing a four-phase
problem solving approach - Measure, Analyze, Improve and Control. A few years later Bob Galvin
launched a long-term quality program called “The Six Sigma Quality Program” in Motorola.
Looking at the success of Motorola, many companies like Texas Instruments, Allied Signal etc started
using Six Sigma methodology to bring organization-wide improvements.
In 1990’s Jack Welch launched Six Sigma in GE in a big way. He implemented Six Sigma in all areas and
ensured that the entire organization participates in the initiative. He changed the performance incentives
and made them based on individual’s ability and enthusiasm to take part in Six Sigma initiatives. He
transformed GE to a state where Six Sigma had become the culture of the organization and not just a
methodology for brining organization-wide improvements.
Improvements can be of two types: improving the existing process or designing a new process altogether.
When we have an existing process and we want to improve the process we deploy the DMAIC
methodology. While designing a new process or completely revamping the existing process the Design
for Six Sigma or IDOV methodology is deployed.
DMAIC v/s DFSS
DMAIC DFSS
Control Standardize and document the process and implement the plan.
Monitor the process and feedback the results back to the process for
continuous improvement.
DFSS (IDOV) Methodology
Y X
Effect Cause
Symptom Problem
It is monitored It is controlled
It is important to know that the variable or the factor that we want to improve is a Y or an X. If the variable
under control is a Y then we should identify the Xs or the independent variables that affect Y and we
should focus on improving the Xs and thereby improving the Y. There could be more one X that
influences the Y and we should try to brainstorm along with the team to identify as many Xs as possible
and then perform Pareto analysis or other prioritization tools to identify the critical Xs that impact our Y.
Customer
Customer is the person (whether internal or external to the organization) who uses the output that the
organization produces. A customer could be
Customer Requirements
Customer requirements can be defined as the needs of the customer and his expectations from the
output that the organization is producing and delivering. When the organization is able to meet all the
customer requirements then it will lead to Customer Satisfaction. On the contrary, if the organization is
unable to meet the customer requirements then the customers will be dissatisfied and over the period of
time they will turn away from the organization’s product. Customer requirements are also called Voice of
the customer - “VOC”.
Y=f(x)
The simple looking equation mentioned above can be described as the crux of the Six sigma philosophy.
The component parts of the equation are as follows:
What the equation is actually saying is that the outputs we receive are the function of the inputs that we
give to our process. Hence if we were able to control the inputs with precision, the outputs would also be
controlled in a precise manner
Data Driven
Here is how a typical Six Sigma project works:
1. A thorough understanding is reached about the required state of affairs for outputs i.e. the Y’s are
clearly defined
2. A process map is drawn to understand the process through which X’s (inputs) are transformed
into Y’s (outputs)
3. Statistical methods are used to find out which amongst the inputs has the greatest bearing on the
desired state of outputs. Inputs are never equally important, some of them are more important
than the other and must be controlled in such a manner.
4. A desired state of affairs is decided in terms of the amount of inputs that should be added to get
the desired outputs.
5. A process is created to monitor the inputs being added to the production. Simultaneously outputs
are measured to check whether they confirm to the norms which have been agreed upon
Hence the entire Six Sigma process is dependent upon the use of precise statistical controls. It
uses numbers to define the desired state of outputs, the required inputs and whether the process
is working as expected.
Consistency
Along with being process and data driven, the whole Six Sigma philosophy is about being consistent. It is
about sustained intensity rather than short bursts of power. Six Sigma focuses on developing the
capability to deliver the same results over and over again with zero variance rather than delivering it once.
Data is used to find out how the process should function, then numbers are used to keep a track of
whether the process is functioning the way it was supposed to.
Reduces Wastage
Six Sigma projects realise a large amount of their financial value from their ability to eliminate or at least
reduce wastage. Since the process is critically analysed for costs and corresponding value addition,
measures are taken to eliminate wastage to a large extent.
All of the sources mentioned above can be seen as the revenue model of the Six Sigma project. In the
financial evaluation of a project, the revenue (cost reduction) from various sources must be considered
before deciding whether the project is worth the effort or not. The idea is to find scenarios that the firm will
be in with the project and without it.
hough Six Sigma is universally known for over two decades now, it is only in the recent past that Six
Sigma Plus has become popular among the quality professionals.
To put it simply, Six Sigma Plus is more than Six Sigma and the “Plus” is used to denote the
“synergies” that are achieved by integrating people, processes and strategy.
For instance, Six Sigma aims reducing the defects in a million parts to 3.4. Likewise, Six Sigma plus uses
the same metrics for defect prevention. So, one might be tempted to ask, what is it that is so different
about Six Sigma Plus? The answer lies in looking at the scope of a typical Six Sigma Plus implementation
as compared to a Six Sigma implementation.
A Six Sigma Plus initiative aims to “integrate” the three cornerstones of an organization i.e. systems,
processes and people and melding them together with the underlying business strategy.
This means that unlike Six Sigma that concentrates on processes and reducing the defects, Six Sigma
Plus goes beyond the statistics and instead aims at a “holistic” approach that takes into account the
customer focus and customer centric strategy.
Further, Six Sigma Plus is a “proactive” approach that anticipates future trends and acts in the present to
capitalize on them when they become the standard. In this way, Six Sigma Plus hopes to go beyond Six
Sigma in its scope.
Now that we have defined what Six Sigma Plus is, it is useful to look at the areas covered in a typical Six
Sigma Plus implementation. Traditionally Six Sigma implementations covered the production processes
and aimed at defect reduction and defect prevention in those processes.
However, Six Sigma Plus implementations typically cover all the departments including the functional
areas and the product development functions as well. This ensures a comprehensive coverage of all the
processes in an organization and not only the production processes.
Further, Six Sigma Plus implementations are typically customer focused which means that these
implementations anticipate customer trends and act decisively to integrate customer needs and
expectations into the implementations.
The point here is that TQM is more of an internally focused measure that aims to reduce defects and
hence satisfy the customer whereas Six Sigma Plus takes the customer as the starting point and works
the quality processes from this perspective.
The other differences between TQM and Six Sigma Plus include the “change” aspect of Six Sigma Plus
where the objective of the latter is to proactively seek measures to improve quality as opposed to that of
the TQM methodology which concentrates on doing the same process to the quality norms prescribed for
the process.
The difference here is one of continuous improvement and change with each iteration as opposed to
merely reducing the incidence of defects. The operative term here is “change” and the practitioners of Six
Sigma Plus tend to call themselves as “change agents” as opposed to calling themselves as “quality
champions” in TQM implementations.
Further, Six Sigma Plus focuses on driving change through the organization by identifying areas in the
processes that can be improved and being customer focused as well as extending the process
improvement to all functional areas. In short, Six Sigma Plus covers the entire organization whereas
standard quality management methodologies like TQM confine themselves to quality control and quality
management of the production processes.
The difference here is that Six Sigma aims to identify process improvements in all functional areas and
build on them proactively whereas TQM usually contends itself to preventing defects in selected
processes and areas in the company.
Though, the differences between Six Sigma Plus and Six Sigma appear superficial on first glance,
there are indeed significant differences in the way these methodologies are implemented.
The Six Sigma framework posits an acceptance of two defects per billion samples tested. Though this
might seem impossible to attain particularly in the manufacturing sector where quality slippages are
common, it is indeed the case that several companies like GE, Dow Chemical, The TATA group and
banking institutions like JPMC, Citigroup and Bank of America have successfully adopted the Six Sigma
framework.
The adoption of Six Sigma by these companies came about as a result of a focus on quality that was both
top-down and bottom-up and the combined efforts of all the stakeholders ensured that the exercise was a
success.
However, it needs to be mentioned that adoption of the framework is the first step in the process of
attaining quality excellence as the companies need to adhere to the framework in their every day
operations in order to claim that they are indeed Six Sigma compliant.
As many experts have put it, Six Sigma Plus takes the Six Sigma methodology and adds the aspects of
leading change to strategy, coaching leaders to people development, a practical approach to theory,
implementation of customer focused projects to training, enhanced tools through components (as
discussed in the section related to Six Sigma Plus) and using a mix of soft skills and hard skills to make
the company more competitive with regards to its competitors.
Conclusion
This article has discussed the differences between Six Sigma Plus and Six Sigma as well as TQM. The
emphasis in this article has been on finding the added advantage that companies get when they embrace
Six Sigma Plus as opposed to traditional methodologies like TQM. As can be seen from the preceding
discussion, the alignment of people, processes and systems with that of business strategy in a holistic
manner and achieving synergies in the interaction of the components is a hallmark of Six Sigma Plus
implementations.
Further, Six Sigma Plus seeks to drive change and focus on leadership as opposed to merely training
people in the methodology. The key term here is the ability to conceive of a different mindset when it
concerns quality and hence Six Sigma Plus can be thought of a philosophy of quality as opposed to
implementation of statistical measures of quality.
In conclusion, Six Sigma Plus is an emerging model of quality excellence that goes beyond traditional
conceptions of quality and gives an entirely new meaning to the concept of quality control. It remains to
be seen how many companies adopt the Six Sigma Plus methodology and how successful this addition to
the existing pantheon of quality initiatives would be.