A

PROJECT REPORT ON
SIX SIGMA BY MOTOROLA
SSUBMITTED BY:
SWATI VERMA
MMS- MARKETING
ROLL NO.- 178

UNDER GUIDANCE OF
PROF. BALASHANKAR RAMDAS SIR
PILLAI'S INSTITUTE FOR MANAGEMENT
STUDIES & RESEARCH, NEW PANVEL

SIX SIGMA
Six Sigma is a set of techniques and tools for process improvement. It was
developed by Motorola in 1986,coinciding with the Japanese asset price bubble
which is reflected in its terminology. Six Sigma became famous when Jack
Welch made it central to his successful business strategy at General Electric in
1995. Today, it is used in many industrial sectors.
Six Sigma seeks to improve the quality of process outputs by identifying and
removing the causes of defects (errors) and minimizing variability in
manufacturing and business processes. It uses a set of quality management
methods, including statistical methods, and creates a special infrastructure of
people within the organization ("Champions", "Black Belts", "Green Belts",
"Yellow Belts", etc.) who are experts in the methods. Each Six Sigma project
carried out within an organization follows a defined sequence of steps and has
quantified value targets, for example: reduce process cycle time, reduce
pollution, reduce costs, increase customer satisfaction, and increase profits.
These are also core to principles of Total Quality Management (TQM) as
described by Peter Drucker and Tom Peters (particularly in his book "The
Pursuit of Excellence" in which he refers the Motorola six sigma principles).
The term Six Sigma originated from terminology associated with manufacturing,
specifically terms associated with statistical modeling of manufacturing
processes. The maturity of a manufacturing process can be described by a
sigma rating indicating its yield or the percentage of defect-free products it
creates. A six sigma process is one in which 99.99966% of the products
manufactured are statistically expected to be free of defects (3.4 defective
parts/million), although, this defect level corresponds to only a 4.5 sigma level.
Motorola set a goal of "six sigma" for all of its manufacturing operations, and this
goal became a by-word for the management and engineering practices used to
achieve it.

SIX SIGMA IN MOTOROLA

The Motorola Six Sigma model was developed in 1986 when employee Bill
Smith proposed a concept aimed at minimizing variability in manufacturing
through the standardization of product defect measurement. In 2008, the
concept integrated the lean manufacturing methodology of optimizing customer
value and reducing waste. Ultimately, this accumulated into Lean Six Sigma.
Six Sigma has evolved over the last two decades and so has its definition. Six
Sigma has literal, conceptual, and practical definitions. At Motorola University,
we think about Six Sigma at three different levels:
As a metric
As a methodology
As a management system
Essentially, Six Sigma is all three at the same time.
Six Sigma as a Metric
The term "Sigma" is often used as a scale for levels of "goodness" or quality.
Using this scale, "Six Sigma" equates to 3.4 defects per one million
opportunities (DPMO). Therefore, Six Sigma started as a defect reduction effort
in manufacturing and was then applied to other business processes for the
same purpose.
Six Sigma as a Methodology
As Six Sigma has evolved, there has been less emphasis on the literal definition
of 3.4 DPMO, or counting defects in products and processes. Six Sigma is a
business improvement methodology that focuses an organization on:
Understanding and managing customer requirements
Aligning key business processes to achieve those requirements
Utilizing rigorous data analysis to minimize variation in those processes
Driving rapid and sustainable improvement to business processes

At the heart of the methodology is the DMAIC model for process improvement.
DMAIC is commonly used by Six Sigma project teams and is an acronym for:
Define opportunity
Measure performance
Analyze opportunity
Improve performance
Control performance
Six Sigma Management System
Through experience, Motorola has learned that disciplined use of metrics and
application of the methodology is still not enough to drive desired breakthrough
improvements and results that are sustainable over time. For greatest impact,
Motorola ensures that process metrics and structured methodology are applied
to improvement opportunities that are directly linked to the organizational
strategy.
The Motorola Six Sigma model was developed in 1986 when employee Bill
Smith proposed a concept aimed at minimizing variability in manufacturing
through the standardization of product defect measurement. In 2008, the
concept integrated the lean manufacturing methodology of optimizing customer
value and reducing waste. Ultimately, this accumulated into what we currently
call Lean Six Sigma.

The Motorola Six Sigma model was developed in 1986 when employee Bill
Smith proposed a concept aimed at minimizing variability in manufacturing
through the standardization of product defect measurement. In 2008, the
concept integrated the lean manufacturing methodology of optimizing customer
value and reducing waste. Ultimately, this accumulated into what we currently
call Lean Six Sigma.

Motorolas Second Generation

Motorola Inc. invented Six Sigma, and we have learned a great deal about it
over the last 15 years. During that time, Six Sigma has evolved from its roots as
a measure of quality to an overall business improvement methodology.
Origins
In 1986, Bill Smith, a senior engineer and scientist within Motorolas
Communications Division, introduced the concept of Six Sigma in response to
increasing complaints from the field sales force about warranty claims. It was a
new method for standardizing the way defects are counted, with Six Sigma
being near perfection. Smith crafted the original statistics and formulas that were
the beginnings of Motorolas Six Sigma methodology. He took his ideas to CEO
Bob Galvin, who was struck by Smiths passion and came to recognize the
approach as key to addressing quality concerns. Six Sigma became central to
Motorolas strategy of delivering products that were fit for use by customers.
Following a common Six Sigma methodology (measure, analyze, improve and
control) Motorola began its journey of documenting key processes, aligning
processes to critical customer requirements and installing measurement and
analysis systems to continuously improve the process. As a result, in 1988
Motorola became the first company to win the Malcolm Baldrige National Quality
Award. In 1990, Motorolatogether with companies such as IBM, Texas
Instruments and Xeroxcreated the concept of Black Belts (BBs), who would
be experts in applying statistical methods. Later, Allied Signal (now Honeywell
International Inc.) and General Electric Co. successfully applied and popularized
Motorolas Six Sigma methodology as part of leadership development.

From Quality to Business Improvement

While Six Sigma was originally created as a continuous quality improvement
technique, today it is significantly different than the total quality management
(TQM) approach of the 1980s. Table 1 (p. 13) shows the key differences
between Six Sigma and TQM. From our extensive experience, Motorola has
learned Six Sigma goes far beyond counting defects in a process or product.
The next generation Six Sigma is an overall high performance system that
executes business strategy. Experience leads us to the insight that Six Sigma
demands the following four steps:
1. Align executives to the right objectives and targets.
2. Mobilize improvement teams.
3. Accelerate results.
4. Govern sustained improvement.
Step 1Align
The new Six Sigma starts with senior executives creating a balanced scorecard
of strategic goals, metrics and initiatives to identify the improvement points that
will have the most effect on the organizations bottom line (see Figure 1).
Critical scorecard metrics drive stretch
goals for the various business processes
owned
and
supervised
by
senior
executives. Process owners champion the
creation of high impact improvement
projects to realize the strategic goals. In the
second generation Six Sigma at Motorola,
processes are not limited to the classic
product and service domains. They can
involve market share improvements, better
cash flow and improved human resource
processes. Executives select and supervise
a handful of improvement projects by
releasing constraints in business processes
that cause critical business gaps.

Step 2Mobilize
Customer focused project teams are formed and empowered to take action (see
Figure 2). Executive process owners empower Bbs to lead well-defined
improvement projects. Six Sigma business improvement teams use: A
systematic problem solving method to frame the sequence of project tasks.
Analytical techniques to drive fact based
decision making.
Interventions to sustain business impact.
The step by step problem-solving
framework and work breakdown structure
can be remembered easily by using the
acronym DMAIC:
First, the business problem is Defined to
determine what needs to improve.
The team then Measures the current
state against the desired state.
The team Analyzes the root causes of the
business gap.
The team then brainstorms, selects and
implements
the
best
Improvement
solutions.
Last, the team Controls the long-term
sustainability of the improvements by
establishing
monitoring
mechanisms,
accountability and work tools.
In the traditional form of Six Sigma, the measurement focus was on the number
of defects per million opportunities (DPMO), which is used to calculate the Six
Sigma metric. Today, while we can still use DPMO and Six Sigma calculations,
they are not desirable in some situations, particularly human intensive
processes such as marketing and human resources.
In the case of human resources, the definition of a defect, such as employee
performance that falls below a certain level, can be controversial and can also
be manipulated to get a better sigma value. For all measures with the second
generation Six Sigma, the focus on defects and sigma levels is less important.
The emphasis is on using variable (continuous) data whenever possible rather

than attribute data.

Continuous data provide more information about the process for a given sample
size, and the use of continuous performance metrics, such as capability indices,
provide a faster and less costly road to obtaining Six Sigma levels of quality.
This concept is particularly important for service and transactional processes, in
which the data historically collected has been attribute data in the form of counts
or percentages. For example, metrics, such as the number of overdue invoices
in an invoicing process or the percentage of dissatisfied customers in a credit
approval process, can be replaced with continuous metrics, such as invoice
delivery time or credit approval response time. Often, customer requirements
will generate specification limits that we can use to compute capability indices
rather than DPMO and Six Sigma numbers.
Step 3Accelerate
Six Sigma business improvement teams use an action learning framework to
build their capability and execute the project (see Figure 3). Executives select
appropriate BB and Green Belt (GB) team members based on functional
expertise and provide appropriate resources. Our action learning framework
methodology combines structured education with real-time project work and
coaching.
This approach quickly bridges
candidates from learning to
doing. BB and GB candidates
take an assigned business
improvement project to their
training.
Throughout
the
training and project work, they
are learning problem solving,
project management, process
optimization and statistical
skills while applying them to
the business problem at hand.
Outside the classroom, the
candidates and project teams
receive expert support from
coaches on a just-in-time
basis.

Ongoing reviews with the project Champions also ensure the projects are
progressing according to their time line and milestones. Motorola recognizes
change is best accomplished in sprints rather than marathons, so aggressive
clock management is key to driving projects toward the desired results in time to
make a difference. Finally, a campaign management approach helps integrate
the Motorolas Second Generation various project team efforts so the cumulative
impact on the organization is, in fact, accelerated.
Step 4Govern
Finally, the second generation Motorola Six
Sigma methodology includes a process for
governance (see Figure 4). Leaders actively
and visibly sponsor the key improvement
projects required to execute the strategy. They
rigorously review projects in the context of
process metrics and business outcome goals.
Executive process owners look at overall
organizational dashboards, their own process
metrics and the status of improvement projects
chartered to make improvements and ensure
the overall business system is functioning as
desired.
The final governance step is for leaders to
actively share best practices and knowledge
about improvements with other parts of the
organization that can benefit.
Whats next
What will the next generation of Six Sigma look like at the place where it was
born? Motorola is an organization with a history of embracing renewal and
continuous learning. Those traits have served us well as we apply them to our
Six Sigma business improvement efforts. During the last 15 years, we have
learned a great deal about what works and what doesnt work in our Six Sigma
efforts. We have moved from counting defects in our product manufacturing to
managing variation and systematically improving all our processes.

Most important, we have moved from Six Sigma as a tool for improving product

quality to Six Sigma as an overall business improvement methodology. The new

Six Sigma combines the power of good business application of statistics with the
critical elements of effective business strategy. It uses an overall business
improvement framework to improve the organizations ability to realize its
strategic objectives. This year and beyond, Six Sigma will be Motorolas tool of
choice for driving bottom-line improvement across the organization. In this
context, Six Sigma projects are carefully chartered to ensure their selection is
based on their direct and near term impact on important scorecard objectives
and metrics. In recognition of the power of customer focus, process analysis and
fact based decision making, our business leaders are expected to embrace the
Six Sigma methodology.
Special efforts are underway to ensure a high percentage of Motorolas leaders
are qualified GBs and the percentage of qualified BBs and BB candidates is up
significantly. More of our Six Sigma efforts areand will continue to be
focused on product design that enhances the overall customer experience and
on software quality as the key driver of long-term performance and reliability.
In addition, more of our projects focus on driving improvement across the
Motorola value chain. Six Sigma projects teams that increasingly involve key
customers, suppliers and other business partners are the norm, rather than the
exception. The Six Sigma improvement methodology Bob Galvin sponsored 15
years ago continues to grow robustly, supporting Motorolas vision for its
customers and shareholders.