Introduction to Six-Sigma ‘Sasadhar Bera, lIM RanchiWhat is Sigma (o)? © (pronounced a5 ‘sigma') 1 a letter in the Greek alphabet, used in statistics to measure dspersion called standard deviation The ais an indicator of the degree of variation ina set of measurement data ora process. Variation 6 present in all manufacturing or service processes. Variation reduces process _ performance, decreases cunamer satifoction, and has a negative Impact on the bottom ine (i terms of monetary value), “Stats isthe only sience that focused on identifying, measuring, and understanding variation, thereby able to Adjust process variables to reduce variation, Properties of Normal Distribution Process follows nermal distribution and no sift of se 68.25 317400 033 220 95.46 45400 osr 230 sors 700 1.00 fo 99.9957 6 133 350 900043, ost 167 36099909008 002 200 Properties of Normal Distribution ‘he Figure below shows & process thats normally ributed and comered with te upper and ower speciation iis (SL Sand (SU) extabled at 80. For thi sation, 99 999098% of the praduct or sevice wil be between spectations, and the ‘noncanormance rate wl be 0.002 parts per millon (pn Properties of Normal Distribution — Process follows normal distribution and no shift of process meanProperties of Normal Distribution —. ‘The Automotive Industry Action Group (AIAG) recognized In the mid 1980' that process center ‘) rarely stay at target (7). The enter tends to "shift above and below the target, Figure below shows a process that is normally distributed, but center has shifted within a range of 1.53 above and 1 Sa below the target (i.e. £1.50 shi For this stuation, 9,9996600% ofthe product or service will be between specifications and the nonconformarce rate willbe 3.4 ppm at #60 specication limits. This offconter situation gives 2 process capability index (Ga) of 15 at 6a performance level and 3.0 being the standard vale of. Properties of Normal Distribution. Process follows normal distribution and process mean shite 21.50 se m9 620.000 0167 220 ee 308770 ous? 20 ss ssi 0500 oo ma 6210 one 50 wn ma ue 280 989997 aa 150 Properties of Normal Distribution Process follows normal distribution and process centre shift 41.50 Six-Sigma (60) ‘The type of shift discussed in previous slides is called short term process shift which is assumed in the sixsigma philosophy.History of Six-Sigma (6a) ‘What is Six-Sigma (60)? ‘Motorola inroduced the concept of SicSigma inthe year Statistical measurement: From a statistical viewpoint, 2 1989. Stesigma process has 34 defects per milion of ‘opportunities. Siesigma method determines current ‘After Motorola’ creation of shcslama, Aliedsignal and process performance level, It aso allows us to draw General Electric (GE) popularized it in the 1990s, The comparisons to others sinllar of dissimilar products, secesses have encouraged many other companies to services and process. gentecete 4: eres RSE Philosophy: Sicsigma is used to define 2 philosophy of improvement that focuses on reducing. defects and Sicsigma has been found to be effective in all ypes of peieres fie Comes 9 ‘companies including manufacturing, service, nancial and Ieltheare sectors. Business strategy: Sisigma can greatly help us to gain a competitive edge. As sigma rating ofa process goes up Today it has become widely recognized as an effective the product quit improves and costs go down. Natura, ‘method for improving business performance. the customer becomes more satisfied What is Sie-Sigma (60)? »— Sigma Level and DPMO ‘ix sigma(6o) methodology provides an overal strategy for Detect per mition ‘mprsung the performance ofthe organization in terms of Sema evel opportunities dminstrative, nantacring and service processes. @ {ormay of Defect Free 2 soar 303 2 soa.r0 2 3 ean. 333 ‘ 20 os 5 23 598 ‘ 3A 50997Difference between 36 and 60 Process in» ‘ 60 quality compliant process produces extremely few defects, 3.4 defects per millon of opportunities (99.9997% defect free). The current standard based on statistical process contol 30 which translates to approximately {66,800 defects per milion opportunities (93.3% defect free}. Ne consider misspelled workin an encyclopedia, in 30 performance level there ts one misspelled work per 15 pages of text. in Go performance level, there is one misspelled work per 300,000 pages of text. Illustration of Six-Sigma Process ‘Suppose that you run a restaurant business that delivers lunch to nearby ofces. You make pretty good hygienic foods ‘and have lots of customers. according to your contract with your customer, lunch will bbe delvered fresh and hot between 12:30 PM to 1:00 PM, “This allows customers to get their orders in time for lunch. ‘You have aso agreed that if lunch is delivered before 12:30 [PM or afte 3:00 PM, you have to discount the nextday order ‘by 50 percent. ‘Your staffs are all very motivated to deliver the lunch during ‘the halfhour window and get bonus for on-time delivery. Differance between 30 and 60 Process fan Airline company has thelr luggage handling process at sigma level, then there wil be 65800 misplaced of ueeage for everyone millon luggage transactions. At sigma level it Isonly 4 misplaced of luggage. Ia bank processes 25,000 creditcard bil na month and ‘operated at sigma level, ends 250 numbers of faulty bl ‘makes 150 customers unhappy every menth and resulting in customer dissatisaetion Six Sigma isnot merely 3 statistical program; rather it shows yoirhow to se statisties and how to understand thelr value, in order to make rational and measurable deciions about ‘your business processes A IMlustration of Six-Sigma Process Question: How sicsigma can be used to measure the performance of the deluery process? If you deliver lunch about 69 percent cases within the specified time interval, your process is at caly 2 "2 sigma’ level If you delver 933 percent cases within the specified ime Inteevl, which sounds sped, you are operating ot only a "3 sigma" level of performance. If you can deliver 99.4 percent cases within the specifi time interval, you're operating a 4 sigma”