Six Sigma Methodology

Overall business improvement methodology

Drives improvement in business processes by reducing defects,
cycle time, impact to the environment, and other undesirable variations


Sigma refers to a universal measurement of goodness, or a relative way to measure
improvement.

4 Points:
Align
Mobilize -> Focus
Accelerate -> Action learning
Clock management
Effective planning
Govern -> Need a regular communications plan and a clear review process
Actively sponsor teams and their projects
Encourage proactive dialogue and knowledge-sharing on the
team and throughout the organization

DMAIC process:
Define, Measure, Analyze, Improve, & Control


Govern
Provide visible leadership, rigorous review of projects, ongoing knowledge
sharing, and proactive communications. These task descriptions are chiefly associated with
which principle?

Strategies and Objectives
Vision
Mission
Strategic Objective

A. What is important?
D. How are we doing?
C. What is wrong?
E. What needs to be done?
B. How do we guarantee performance?


Black and Green should do:
Remove obstacles for the team
Conduct sources of variation studies
Identify, prioritize, and select the improvement opportunities
Implement DMAIC process throughout the campaign

Six Sigma is:
A business improvement process that focuses on customer requirements, process
alignment, and analytical rigor
A proven tool set for driving and achieving transformational change within the
organization
An overall methodology that drives business improvement

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Start off with Six Sigma as a measurement. Sigma is a measurement of "goodness" using a
universal measurement scale. Sigma provides a relative way to measure improvement.

Sigma is measured in defects per million opportunities (DPMO). For example, a level of sigma
can indicate how many defective coffee mugs were produced when one million were
manufactured.

Universal means sigma can measure anything from coffee mug defects to missed chances to
close a sales deal. It simply measures how many times a customer's requirements were not
met (a defect), given a million opportunities. Fortunately, one million is a scaling factor. You
don't have to wait until one million mugs are manufactured before calculating sigma.

Levels of sigma are associated with improved levels of goodness. To reach a level of Three
Sigma, you can only have 66,811 defects, given a million opportunities. A level of Five Sigma
only allows 233 defects.

The difference between sigma levels is not simply cutting the amount of defects in half. With
each rise in sigma level, the number of defects is reduced exponentially.
SIGMA LEVEL DIFFERENCES
So what does this mean in terms of the
real world?
Take a look at the difference between a
Three Sigma and a Six Sigma quality
level.

Three Sigma Five Sigma Six Sigma
At least 500,000 wrong drug
prescriptions a day (based
on 2,730,000,000
prescriptions per year)
1,700 incorrect
prescriptions a day
(based on 2,730,000,000
prescriptions per year)
Only 25 incorrect
prescriptions per day
(based on 2,730,000,000
prescriptions per year)
11 hours of dead air time
per TV channel each week
2 minutes of dead air per
TV channel each week
Less than 2 minutes of
dead air per TV channel
each year
80 short or long landings at
OHare airport each day
9 short or long landings a
month
Only 2 short or long
landings per year

Minimizing variation is a key focus of Six
Sigma. Variation leads to defects, and
defects lead to unhappy customers.
Whenever a product is created or a
service performed, it needs to be done
the same way every time, no matter who

Anytime Motorola delivers a product or
service off-target from what a customer
wants, even if it's within what the
customer is willing to accept, the
customer is less satisfied and less loyal.

To keep customers satisfied, loyal, and
coming back, you have to eliminate the
sources of variation.
is involved. Only then will you truly
please the customer.
In an effort to permanently minimize
variation, Motorola has evolved the Six
Sigma methodology to use information
systems tools to make business
improvements absolutely permanent.
Motorola calls this effort Digital Six
Sigma.

Motorola isn't the only one having success with Six Sigma. The following is just a sample of
results from Six Sigma projects across the business spectrum.*
Waste reduction saved $120,000
Reduced costs by $50,000 per year
On-time delivery improved to 97%; yields improved to 97%
Reduced scrap by 15%; reduced rework by 25%
Reduced downtime by 30%
Improved production throughput by 43%; reduced the No. 1 defect in the plant by 50%
Increased production capability 12 - 16%
No. 1 customer complaint 99% eliminated, saving more than $1 million per year
Reduced manufacturing defects by 67%
30 Black Belt and Green Belt projects completed; saved $14,625,800
Increased productivity of call center analysts by 23%
Customer service incidents reduced more than 50%
More than $7 million in savings in six months
Today's business leaders face a new reality. They must consistently:
Generate month-to-month financial results (profit)
Build a long-term, sustainable business model
Fight for talent, customers, market share, and investors
Provide superior customer service and performance
By building Six Sigma process and people capability, they can accomplish all of these things at
the same time.

Past management approaches, such as Total Quality Management (TQM), have failed in many
businesses. After initial successes, these approaches have not yielded sustainable business
results.
Only Six Sigma has produced results that have been sustained over time. It consistently
delivers on its promise because the metric and method drive a reduction of variation that results
in near-perfect business results -- permanently. That's another reason Motorola has renewed its
interest in Six Sigma.
As Motorola continues to learn, it continues to improve Six Sigma. The Six Sigma
methodology continues to increase its power.



Todays Six Sigma involves:




Executive ownership
Business strategy
An established infrastructure
Truly cross-functional improvement
Permanent improvement
Training with ROI (return on investment)
Digital cockpit
Motorola has discovered another way to improve Six Sigma -- Digitization. Digital Six Sigma
involves three improvements to classic Six Sigma:
Digitization uses information technologies to permanently remove targeted sources of
variation that cause defects
Digitization automates non-value-added human tasks to improve efficiency
Digital cockpits show the progress of important measures over time
This is where Six Sigma comes into the picture. Six Sigma lists the following as primary
objectives: goals of the Six Sigma business improvement campaign
Rapid business improvement
Sustainable results

hrough years of experience, Motorola has identified five key elements that must be present for
Six Sigma to work:
The Six Sigma principles of leadership
An integrated approach to leading improvement efforts
Driving results through engaged teams
The Six Sigma analytic tools and a disciplined, standardized methodology for their use
Digital improvements, including hard-coded improvements that utilize reusable web
tools to eradicate defects from the face of the earth
Typically, you will spend the majority of your training time learning to use the Six Sigma analytic
tools. But don't forget that this is just one part of the whole picture. You also need to keep in
mind the other key elements. Without all of them, Six Sigma will not work effectively.




Six Sigma is a business improvement methodology. The overall Six Sigma methodology is a
top-down approach that focuses an organization on:
Customer requirements
Process alignment
Analytical rigor
Timely execution
Today's business climate has changed, and previous business improvement efforts are no
longer effective. Six Sigma has risen to take their place, with the most robust, mature, and
effective business improvement methodology in industry. Digital Six Sigma is a significant
improvement to the classic -- ensuring that fixes are forever.

This insight was captured in the four Six Sigma Leadership Principles:
Align: Leadership should ensure that all improvement projects are in line with the
organization's strategic goals.
Mobilize Leadership should enable teams to take action by providing clear direction,
feasible scope, a definition of success, and rigorous reviews.
Accelerate Leadership should drive a project to rapid results through tight clock
management, training as needed, and shorter deadlines.
Govern Leadership must visibly sponsor projects and conduct regular and rigorous
reviews to make critical mid-course corrections.
Y: Y stands for the results that matter, or the measurement goal that you are trying to achieve.
When people refer to the "Y," theyre referring to what they want to accomplish.
X: X represents variables that affect the Y, or the factors that determine whether you reach your
goal. Xs drive the performance that leads to Y.
Being very clear on what you're trying to improve (Y) and which critical actions will get you there
(Xs) is the key to simplifying business improvement. For example, say an organization is having
a problem with cash flow.
Certain activities make it possible for enough cash to be on hand for an organization to conduct
business. These activities, called Xs, enable the end result Y, enough cash on hand to conduct
business.
Activities such as collecting accounts receivable, repaying company loans, or paying rent on the
company building (Xs) affect how much cash the organization has on hand to conduct
business (Y).
Without sufficient cash flow, the organization will have problems meeting its financial
obligations. The company may have money coming in on Monday, but if payday is Friday,
Monday comes too late. Focusing on the cash flow big Y means adjusting the Xs until cash flow
is optimal.




Leadership should not start any Six Sigma project unless it is aligned to the following elements:
Customer requirements
Key processes
Metrics
Performance drivers
The third Leadership Principle is Accelerate. It involves three main components:
Action learning
Clock management
Effective planning
When you govern a Six Sigma project, you:
Need a regular communications plan and a clear review process
Actively sponsor teams and their projects
Encourage proactive dialogue and knowledge-sharing on the team and throughout the
organization
Conducting regular and rigorous reviews of projects allows teams to make critical mid-course
corrections. Frequent reviews ensure projects are meeting their defined goals and that the
results will be correctly aligned. Teams should be meeting with leadership on a weekly basis so
problems can be caught early and solved quickly.

As projects across an organization are correctly governed, the results accumulate. Projects
drive process improvements. Process improvements drive scorecard impact. The result is an
organization that is effectively meeting its strategic goals. This is known as the Integrated
Review Process, and it ensures alignment across an organization.

These successful results are sustainable only through continuous monitoring and reviewing.
Initial execution is not enough. Govern requires more.


The Six Sigma Leadership Principles are one of the keys for obtaining rapid business
improvement and sustainable results. Leadership uses these principles as a guide while
selecting improvement opportunities and driving results. In short, the principles guide every
aspect of Six Sigma. They help maintain a focus on the big Ys (results required for an
organization to reach its strategic goals), and provide a means for improvement team members
to see the same.

The principle of Align requires all improvement projects to be directly linked to an organization's
strategic goals. This is accomplished with the use of a scorecard, a tool that translates strategy
into tactical operating terms. The scorecard provides a line-of-sight alignment all the way from
an organizational vision down to the goals of individual employees.
Mobilize requires that teams be provided with the focus they need to complete their projects and
positively affect the organization's big Ys. This focus is provided in the form of a Team Charter
that answers such important questions as what are we doing, why are we doing it, what needs
to be done, how should it be done, and who will be doing it. The Team Charter also ensures the
project is properly aligned.

Accelerate involves focusing on the "rapid" part of "rapid business results." Shorter deadlines,
tight clock management, and rigorous reviews are combined with the action learning
methodology to quickly provide results. Action learning combines structured education with real-
time project work and coaching to quickly bridge from "learning" to "doing."

The principle of Govern reminds management that more is required than simply selecting
improvement opportunities and assigning a team. Frequent and rigorous reviews must be
conducted in order to provide all required support and to help the team make critical mid-course
corrections. Through the Integrated Review Process, alignment can be ensured across an
organization.

Black Belts have many responsibilities. They:
Function as a Team Leader on Black Belt projects
Integrate their functional discipline with statistical, project, and interpersonal skills
Serve as internal consultants
Tackle complex, high-impact improvement opportunities
Mentor and train Green Belts
Experienced Black Belts, skilled in coaching others and producing dynamic results, may receive
recognition as Master Black Belts. Master Black Belts handle extremely difficult problems and
mentor other Black Belts.

Green Belt responsibilities include:
Acting as Team Leader on business improvements requiring less complex analysis
Adding their unique skills and experiences to the team
Working with the team to come up with inventive solutions
Performing basic statistical analysis
Conferring with a Black Belt as questions arise

Green Belt responsibilities include:
Acting as Team Leader on business improvements requiring less complex analysis
Adding their unique skills and experiences to the team
Working with the team to come up with inventive solutions
Performing basic statistical analysis
Conferring with a Black Belt as questions arise

Within the typical Six Sigma project, four critical roles exist.
Sponsor
Champion
Team Leader
Team member
For a team to function effectively, all four roles need to be filled. However, depending on the
needs of an organization, the same person could fulfill two roles. The important thing is that all
the required tasks are being completed.
A Sponsor typically:
Remains ultimately accountable for a project's impact
Provides project resources
Reviews monthly and quarterly achievements, obstacles, and key actions
Supports the project Champion by removing barriers as necessary
A Champion typically:
Reviews weekly achievements, obstacles, and key actions
Meets with the team weekly to discuss progress
Reacts to changes in critical performance measures as needed
Supports the Team Leader, removing barriers as necessary
Helps ensure project alignment
A Team Leader typically:
Leads improvement projects through an assigned, disciplined methodology
Works with the Champion to develop the Team Charter, review project progress, obtain
necessary resources, and remove obstacles
Identifies and develops key milestones, timelines, and metrics for improvement projects
Establishes weekly, monthly, and quarterly review plans to monitor team progress
Supports the work of team members as necessary
A team member's contribution is vital to the success of any project. While most likely unable to
complete the same complex statistical analysis as a Black Belt, team members offer unique
functional experience Black Belts may not have.

Team members on Green Belt projects may include Green Belts or other employees who aren't
experts at Six Sigma. On Black Belt or Breakthrough teams, Black Belts, as well as Green Belts
and other non-Six-Sigma experts, may fulfill the role of team member.

Team members typically:
Assist the Team Leader
Follow a disciplined methodology
Ensure the Team Charter and timeline are being met
Accept and execute assignments
Add their views, opinions, and ideas
Team Role Responsibilities
Sponsor Is part of leadership team and remains ultimately accountable for
a project's impact
Provides project resources
Reviews monthly and quarterly achievements, obstacles, and
key actions
Supports the project Champion by removing barriers as
necessary
Champion Reviews weekly achievements, obstacles, and key actions
Meets with the team weekly to discuss progress
Reacts to changes in critical performance measures as needed
Supports the Team Leader, removing barriers as necessary
Helps ensure project alignment
Team
Leader
Leads improvement projects through an assigned, disciplined
methodology
Works with the Champion to develop the Team Charter, review
project progress, obtain necessary resources, and remove
obstacles
Identifies and develops key milestones, timelines, and metrics for
improvement projects
Establishes weekly, monthly, and quarterly review plans to
monitor team progress
Supports the work of team members as necessary
Team
Members
Assist the Team Leader
Follow a disciplined methodology
Ensure the team charter and timeline are being met

Accept and execute assignments

Add their views, opinions, and ideas



Teams offer many benefits, including the following:
Varied skill sets as required by projects spanning multiple areas of expertise and
function
Increased creativity through multiple perspectives
The division of labor, which makes it possible to complete the amount of work required
in the short time frame available
Involvement of key stakeholders during the course of the project, ensuring support
when the improvements are implemented
Within the typical Six Sigma project, four roles exist:
Sponsor
Champion
Team Leader
Team member
ANALYTIC TOOL SETS
Ford Global 8D This analytic tool set is used when an organization needs to bring
performance back to a previous level. It addresses a special cause. Ford Global 8D is
a problem-solving method used to close the gap.
DMADV (Define, Measure, Analyze, Design, Verify): Also known as DFSS (Design for
Six Sigma), this tool set is used when an organization needs a new product, process, or
service. Using this tool set, Black Belts optimize performance before production begins.
DMAIC (Define, Measure, Analyze, Improve, Control): Green and Black Belts employ
this framework to drive business improvements that help an organizations processes
reach levels of performance never before seen.
DMADDD (Define, Measure, Analyze, Design, Digitize, Draw-down): Part of Motorolas
Digitization effort, DMADDD is used to drive the cost out of a process by incorporating
Digital improvements. These modifications can drive dramatic improvements in
efficiency by identifying non-value tasks and using simple web-enabled tools to
automate certain tasks. In doing so, employees can be freed up to work on more
important duties.

FORD GLOBAL 8D


DMADV


DMAIC




DMADDD



Analytic
Tool Set
Common Use
Ford
Global 8D
Need to bring performance back to a previous level
DMADV
Need a new process, product, or service
Used when a product, service, or process is required, but does
not exist, or when an existing product, service, or process has
been optimized using DMAIC but is still failing to meet customer
requirements
Also called DFSS (Design for Six Sigma)
DMAIC
Need to reach levels of performance never before seen
Used when an existing product, service, or process is failing to
meet customer requirements or is not performing adequately
Tool set used by Green Belts and Black Belts
DMADDD
Need to drive the cost out of a process and improve efficiency


DMAIC stands for the following:
Define opportunities
Measure performance
Analyze opportunity
Improve performance
Control performance

DEFINE OPPORTUNITIES
What is important?
Objective:
To identify and/or validate the improvement
opportunities that will achieve the organization's
goals and provide the largest payoff, develop the
business process, define critical customer
requirements, and prepare to function as an
effective project team.
Key deliverables include:
Team charter
Action plan
Process map
Quick win opportunities
Critical customer requirements
Prepared team


MEASURE PERFORMANCE
How are we doing?
Objectives:
To identify critical measures that are necessary
to evaluate the success or failure, meet critical
customer requirements, and begin developing a
methodology to effectively collect data to
measure process performance.
To understand the elements of the Six Sigma
calculation and establish baseline sigma for the
processes the team is analyzing.
Key deliverables include:
Input, process, and output indicators
Operational definitions
Data collection format and plans
Baseline performance
Productive team atmosphere


ANALYZE OPPORTUNITY
What is wrong?
Objectives:
To stratify and analyze the opportunity to identify
a specific problem and define an easily
understood problem statement.
To identify and validate the root causes and thus
the problem the team is focused on.

To determine true sources of variation and
potential failure modes that lead to customer
dissatisfaction.

Key deliverables include:
Data analysis
Validated root causes
Sources of variation
Failure modes and effects analysis
(FMEA)
Problem statement
Potential solutions


IMPROVE PERFORMANCE
What needs to be done?
Objectives:
To identify, evaluate, and select the right
improvement solutions.
To develop a change management approach to
assist the organization in adapting to the
changes introduced through solution
implementation.
Key deliverables include:
Solutions
Process maps and documentation
Pilot results
Implementation milestones
Improvement impacts and benefits
Storyboard
Change plans


CONTROL PERFORMANCE
How do we guarantee performance?
Objectives:
To understand the importance of planning and
executing against the plan and determine the
approach to be taken to ensure achievement of
the targeted results.
To understand how to disseminate lessons
learned, identify replication and standardization
opportunities/processes, and develop related
plans.
Key deliverables include:

Process control systems
Standards and procedures
Training
Team evaluation
Change implementation plans
Potential problem analysis
Solution results
Success stories
Trained associates
Replication opportunities
Standardization opportunities

Phase Fundamental Objective
Define -- What is important?
Define the project goals and customer deliverables
(internal and external)
Measure -- How are we doing? Measure the process to determine current performance
Analyze -- What is wrong? Analyze and determine the root cause(s) of the defects
Improve -- What needs to be
done?
Improve the process by permanently removing the
defects
Control -- How do we guarantee
performance?
Control the improved processs performance to ensure
sustainable results

A Six Sigma Business Improvement Campaign has two objectives:
Rapid business improvement
Sustainable results
Six Sigma recognizes five keys to meeting those objectives, including Leadership Principles, an
integrated approach, driving results through engaged teams, the use of Six Sigma analytical
tool sets, and digital improvements.