Lean Six Sigma Green Belt Certification Course

Six Sigma and Organizational Goals

 WHATS IN IT FOR ME

Identify the Six Sigma process and tools

Explain the impact of Six Sigma in an

Use this space to Animate
See examples:
organization
EXAMPLE 1
EXAMPLE 2

Measure organizational performance

 INTRODUCTION

The glass is half The glass is bigger

Pessimist than it needs to be. Six Sigma
empty.
Practitioner

The glass is half The glass is full

full. with water and air.
Realist
Optimist
Lesson 1: Six Sigma and Organizational Goals
Topic 1.1: Value of Sigma

Introduction to Quality
The Journey of Quality
Quality Management Personalities
Meaning of Six Sigma
Six Sigma and Quality
Milestones in the Six Sigma Journey
Importance/Purpose of Six Sigma
The Six Sigma DMAIC Process
Applying the Six Sigma DMAIC Process
Key Terms in Six Sigma
Six Sigma Level Conversion Table
 INTRODUCTION TO QUALITY
MEANING OF QUALIT Y

Quality is defined as Meeting the requirements of the customer."

?
Q

Making changes to meet Meeting customers

Customers expectations
the expectations expectations
 THE JOURNEY OF QUALITY
HIGHLIGHT S IN THE PROGRESS OF QUALIT Y

1930s
Statistical Process
1987
Control 1960s ISO 9000
Quality Circles Baldridge Award
Criteria

1988
Benchmarking
1990s
Balanced 1996
Scorecard (BSC) Re-engineering
Milestones in the
history of Quality
 QUALITY MANAGEMENT GURUS
PROMINENT QUALIT Y LEADERS AND CONSULTANT S

Leaders and quality management consultants who set the foundation of modern quality improvement and strategic change are:

14 key principles for Statistical Process Quality trilogy

management Control charts Top management
Seven wastes Assignable cause vs. involvement
Plan-Do-Study-Act chance cause
cycle Statistics for quality
System improvement management

W. Edwards Walter A.
Joseph M. Juran
Deming Shewhart

Ishikawas cause-and- Quality loss function Crosbys 14 steps to

effect diagram concepts quality improvement
Company-wide quality Signal-to-noise ratio Do It Right First Time
control Robust design Zero Defect
Quality circle Experimental design
methods

Kaoru Ishikawa Genichi Taguchi Philip Crosby

 MEANING OF SIX SIGMA
SIGMA AND SIX SIGMA PERSPECTIVES

Sigma () is a Greek letter Six Sigma is a business

used in the statistical world strategy to change
to represent a measure of company culture with top
variability. management support.

6
The Six Sigma process is 5 Sigma level is a measure
an improvement method of 4 of performance for a
quality principles and 3 business processes or
techniques. 3 service.
1
 SIX SIGMA AND QUALITY
HOW THE T WO CONCEPT S WORK TOGETHER

How Six Sigma impacts the quality of products and services.

Quality

Six Sigma process Increased profits

 MILESTONES IN THE SIX SIGMA JOURNEY
EXAMPLES OF THE IMPACT OF SIX SIGMA ON SUCCESSFUL ORG ANIZATIONS

Bill Smith and Mikel Motorola saved $16

Allied Signal saved
Harry at Motorola billion cumulatively
$0.5 billion with the
started the Six Sigma with the use of Six
use of Six Sigma
initiative Sigma

1986 1995 1998 2000 2001

Jack Welch initiated

GE saved $2 billion
Six Sigma at General
annually with the use
Electric (GE) to
of Six Sigma
improve the entire
business system
 PURPOSE OF SIX SIGMA
THE APPROACHES AND OUTCOMES

Six Sigma is:

Business Customer
methodology satisfaction

Customer-
centric
$ Shareholder
value

Employee
Fact-based commitment
approach
 ORGANIZATIONAL BENEFITS OF SIX SIGMA

Eliminates the root cause of

problems and defects in a process Reduces rework by getting it right
the first time

Creates robust products and

services
Addresses the key business
requirement
Reduces process variation and
waste

Helps gain competitive advantage

Ensures customer satisfaction

Achieves the organizational goals

Achieves process standardization
 BENEFITS TO AN ORGANIZATION

Organizations successful with Six Sigma:

1 2
Have proven systematic problem-solving
methodology
5 3
4

Focus on the customer

Achieve long-term improvements

 THE SIX SIGMA PROCESS
DMAIC PROCESS

Each phase has

An over-arching objective
Specific deliverables that need to be completed

Define Measure Analyze Improve Control

 THE SIX SIGMA PROCESS (contd.)
DMAIC PROCESS

Document the problem and the desired outcome

Define Measure Analyze Improve Control

 THE SIX SIGMA PROCESS (contd.)
DMAIC PROCESS

Obtain baseline process performance levels

Define Measure Analyze Improve Control

 THE SIX SIGMA PROCESS (contd.)
DMAIC PROCESS

Identify key root causes for process variation

Define Measure Analyze Improve Control

 THE SIX SIGMA PROCESS (contd.)
DMAIC PROCESS

Develop, test, and implement solutions

Define Measure Analyze Improve Control

 THE SIX SIGMA PROCESS (contd.)
DMAIC PROCESS

Monitor key factors and maintain the gains

Define Measure Analyze Improve Control

 THE SIX SIGMA TOOLS
TOOLS USED IN THE DMAIC PROCESS

Define Measure Analyze Improve Control

SIPOC Measurement Simple linear Brainstorming Control charts

Voice of Customer System Analysis regression (SLR) Piloting Control plan
(VOC) (MSA) Pareto charts Failure Modes and Measurement
Critical to Quality Control charts Fishbone diagram Effects Analysis System Analysis
(CTQ) Process capability Failure Modes and (FMEA) (MSA)
Quality Function Normality plots Effects Analysis Design of
Deployment (QFD) (FMEA) Experiments (DOE)
Failure Modes and Multi-vari charts
Effects Analysis Hypothesis testing
(FMEA)
Cause and Effect
(C&E) matrix

Some of the tools are not required in every Six Sigma Green Belt (GB) project.
 APPLYING THE SIX SIGMA DMAIC PROCESS
EXAMPLE OF MEETING CUS TOMERS WANT S USING THE DMAIC PROCESS

The problem

Ideal temperature for a

A cup of coffee is either cup of coffee should be
too hot or too cold. between 160F (71C) to
180F (82C).

Customers feedback Java House Coffee Managements feedback

 APPLYING THE SIX SIGMA DMAIC PROCESS
EXAMPLE OF MEETING CUS TOMERS WANT S USING THE DMAIC PROCESS

The solution

DMAIC
process and Average
Average USL
LSL USL tools LSL 170F
170F 180F
160F 180F 160F

Poor process capability Excellent process capability

 KEY TERMS USED IN SIX SIGMA
EXPLAN ATION OF TERMS

Frequently used terms in the Six Sigma process are

Specification limits

Opportunity

Defect

Defective

Rolled Throughput Yield

(RTY)

Defects per Million

Opportunity (DPMO)
 KEY TERMS USED IN SIX SIGMA
EXPLAN ATION OF TERMS

Frequently used terms in the Six Sigma process are:

Specification Limits Meaning

Opportunity Limits set by a customer representing the range of variation the customer can
tolerate or accept

Defect
Explanation with regard to the Java House coffee example

Defective
The Java House Coffee customers had an acceptable coffee temperature
range of 160F to 180F
Rolled Throughput Yield
(RTY)

Defects per Million

Opportunity (DPMO)
 KEY TERMS USED IN SIX SIGMA (contd.)
EXPLAN ATION OF TERMS

Frequently used terms in the Six Sigma process are:

Specification limits Meaning

Opportunity Every chance for a process to deliver an output characteristic that is either
right or wrong as per the customer specifications

Defect
Explanation with regard to the Java House coffee example

Defective
The coffee temperature was the only output characteristic identified from the
customer, which would represent one opportunity per cup of coffee
Rolled Throughput Yield
(RTY)

Defects per Million

Opportunity (DPMO)
 KEY TERMS USED IN SIX SIGMA (contd.)
EXPLAN ATION OF TERMS

Frequently used terms in the Six Sigma process are:

Specification limits Meaning

Every result of an opportunity that does not meet customer specifications and
Opportunity does not fall within Upper Specification Limit (USL) and Lower Specification
Limit (LSL)
Defect
Explanation with regard to the Java House coffee example

Defective
When a cup of coffee does not fall within the specified temperature limit
(<160F or >180F)
Rolled Throughput Yield
(RTY))

Defects per Million

Opportunity (DPMO)
 KEY TERMS USED IN SIX SIGMA (contd.)
EXPLAN ATION OF TERMS

Frequently used terms in the Six Sigma process are:

Specification limits Meaning

Opportunity Results when the entire unit is identified has a nonconforming product
regardless of the number of defects observed

Defect
Explanation with regard to the Java House coffee example

Defective
Every cup of coffee fails to meet the customer requirements
Example: Temperature and taste
Rolled Throughput Yield
(RTY)

Defects per Million

Opportunity (DPMO)
 KEY TERMS USED IN SIX SIGMA (contd.)
EXPLAN ATION OF TERMS

Frequently used terms in the Six Sigma process are:

Specification limits Meaning

Measure of process efficiency expressed and indicates percentage of units

Opportunity that are defect free
Also referred to as Yield value
Defect
Explanation with regard to the Java House coffee example

Defective
The percentage of cups of coffee that meet customers expectations
Rolled Throughput Yield
(RTY)

Defects per Million

Opportunity (DPMO)
 KEY TERMS USED IN SIX SIGMA (contd.)
EXPLAN ATION OF TERMS

Frequently used terms in the Six Sigma process are:

Specification limits Meaning

Opportunity Also known as Non-Conformities per Million Opportunities (NPMO), it is a

measure of process performance

Defect
Explanation with regard to the Java House coffee example

Defective
For 100 cups of coffee measured, the ratio of defects observed to total
number of opportunities is multiplied by one million.
Rolled Throughput Yield
(RTY)
Defects observed
Defects per Million DPMO= *1,000,000
total number of opportunities
Opportunity (DPMO)
 SIGMA CONVERSION TABLE
INDICATORS ON THE SIX SIGMA LEVELS

The Six Sigma Level is a measure of performance for a business process or service.

Sigma Level DPMO Yield/Accuracy (%)

Virtual perfection
6 3.4 99.99966%

5 230 99.977%

Good 4 6,210 99.38%

3 66,800 93.32%

2 308,000 69.15%
Improvement needed
1 690,000 30.85%
 QUALITY MEASURES AND REAL WORLD IMPACT
PREDICTIONS BASED ON THE SIGMA LEVEL AND YIELD

What would be the consequence in the U.S. if a quality goal of 4.5 Sigma Level or 99.90% yield is accepted?

4.5 Sigma
Level
Or
99.90 Yield
 QUALITY MEASURES AND REAL WORLD IMPACT
PREDICTIONS BASED ON THE SIGMA LEVEL AND YIELD

1 hour of unsafe drinking 2 unsafe plane landings per day

water every month at OHare International Airport in
500 incorrect surgical Chicago
operations each week

50 new born babies dropped

at birth by doctors each day

16,000 pieces of mail lost

by the U.S. postal service
every hour 22,000 checks deducted
from the wrong bank
accounts each hour
32,000 missed heartbeats
per person, per year
Knowledge Check
 Customers have asked for products from an IT company to be delivered within two
KNOWLEDGE
CHECK weeks. In this case, a product delivery that takes longer than two weeks would be
considered as:

a. An opportunity

b. A defect

c. A specification limit

d. Defective
 Customers have asked for products from an IT company to be delivered within two
KNOWLEDGE
CHECK weeks. In this case, a product delivery that takes longer than two weeks would be
considered as:

a. An opportunity

b. A defect

c. A specification limit

d. Defective

The correct answer is. d

Explanation: A product delivery is a unit that could be right or wrong.
Lesson 1: Six Sigma and Organizational Goals
Topic 1.2: Goals and Six Sigma Projects

Meaning of Process
Six Sigma and the Business System
Structure of a Six Sigma Team
 COMPONENTS OF A BUSINESS PROCESS
MEANING OF A BUSINESS PROCESS

A process is a series of steps designed to produce a product and/or service as required by the customer.

$
Input (x)
1
Process f(x)
Feedback

3 2
Output (y)

A process will have inputs (x) and delivers outputs (y). Therefore, y = f(x). Any change in the
inputs causes change in the output
 MEANING OF PROCESS
COMPONENT S OF A BUSINESS PROCESS

A process is a series of steps designed to produce a product and/or service as required by the customer.

Input (x)

Process f(x)
Feedback

Output (y)

Focussing on the inputs is like driving a car. It transforms organizations from a pattern of driving
forward by looking in the rear view mirror to driving forward by looking ahead on the road.
 SIX SIGMA AND THE BUSINESS SYSTEM
PURPOSE OF A BUSINESS SYS TEM DESIGN IN AN ORG ANIZATION

1 2
Implement a process or a set of processes
5 3
Business
system 4
design

Process inputs must be at the right place and at the

right time
SIX SIGMA AND THE BUSINESS SYSTEM (contd.)
HOW SIX SIGMA IMPACT S A BUSINESS SYS TEM DESIGN

A business system design: Six Sigma improves the

Collects and analyzes data business system by:

Continuously removing
to ensure continuous
improvement defects in processes
Sustaining the changes
Includes processes or
procedures
 STRUCTURE OF A SIX SIGMA TEAM
LEVEL S IN A SIX SIGMA TEAM

Top
executives
Six Sigma
champions
Six Sigma
Master
Six Sigma Black Belts
Black Belts (MBB)
Six Sigma (BB)
Green Belts
(GB)
 STRUCTURE OF A SIX SIGMA TEAM (contd.)
LEVEL S IN A SIX SIGMA TEAM

Top
executives
Six Sigma
champions
Six Sigma
Master
Six Sigma Black Belts
Black Belts (MBB)
Six Sigma (BB)
Green Belts
(GB)

Six Sigma green belts support the black belts by working on the project and performing day-to-day
jobs.
 STRUCTURE OF A SIX SIGMA TEAM (contd.)
LEVEL S IN A SIX SIGMA TEAM

Top
Executives
Six Sigma
Champions
Six Sigma
Master
Six Sigma Black Belts
Black Belts (MBB)
Six Sigma (BB)
Green Belts
(GB)

Six Sigma black belts apply strategies to specific projects, and lead and direct teams to execute
projects.
 STRUCTURE OF A SIX SIGMA TEAM (contd.)
LEVEL S IN A SIX SIGMA TEAM

Top
Executives
Six Sigma
Champions
Six Sigma
Master
Six Sigma Black Belts
Black Belts (MBB)
Six Sigma (BB)
Green Belts
(GB)

Six Sigma master black belts train and coach black belts, green belts, and various functional
leaders of the organization.
 STRUCTURE OF A SIX SIGMA TEAM (contd.)
LEVEL S IN A SIX SIGMA TEAM

Top
Executives
Six Sigma
Champions
Six Sigma
Master
Six Sigma Black Belts
Black Belts (MBB)
Six Sigma (BB)
Green Belts
(GB)

Six Sigma Champions:

Identify and scope projects, and develop strategy
Identify and coach master black belts
 STRUCTURE OF A SIX SIGMA TEAM (contd.)
LEVEL S IN A SIX SIGMA TEAM

Top
Executives
Six Sigma
Champions
Six Sigma
Master
Six Sigma Black Belts
Black Belts (MBB)
Six Sigma (BB)
Green Belts
(GB)

Top Executives:
Lead change and provide direction
Own the Six Sigma initiatives
Lesson 1: Six Sigma and Organizational Goals
Topic 1.3: Organizational Drivers and Metrics

Key Business Drivers

Balanced Scorecard (BSC) Framework
Development of a Balanced Scorecard
Four-Box Model of BSC vs. Strategy Map
Impact of the BSC to an Organization
 KEY BUSINESS DRIVERS
INTRODUCTION TO BALANCED SCORECARD (BSC)

Financial accounting

1 2

5 3

Physical assets Internal processes Customer satisfaction Learning and growth

BSC
 BENEFITS OF BSC
ADVANTAGES

Actionable
objectives

Prioritizes Framework for

projects and performance
initiatives measurement

Internal
Financials
processes

Integrates Customer Learning Clarifies vision

strategies satisfaction and growth and mission

Aids
Provides
continuous
feedback
improvement
 KEY AREAS IN BSC
FOUR PERSPECTIVES IN BSC

By using BSC, an organization maps its strategic objectives to the specific metrics of performance.

Financial

Vision
and Internal business
Customer
Strategy process

Learning and growth

 KEY AREAS IN BSC (contd.)
FOUR PERSEPCTIVES BSC HANDLES IN AN ORG ANIZATION

Using the BSC, an organization maps its strategic objectives to specific metrics of performance.

Financial
Financial objectives
Tracking financial success

Vision
and Internal business
Customer
Strategy process

Learning and growth

 KEY AREAS IN BSC (contd.)
FOUR PERSEPCTIVES BSC HANDLES IN AN ORG ANIZATION

Using the BSC, an organization maps its strategic objectives to specific metrics of performance.

Financial
Financial objectives
Tracking financial success

Vision Internal business

Customer and process
Strategy Operational goals of internal
processes

Learning and growth

 KEY AREAS IN BSC (contd.)
FOUR PERSEPCTIVES BSC HANDLES IN AN ORG ANIZATION

Using the BSC, an organization maps its strategic objectives to specific metrics of performance.

Financial
Financial objectives
Tracking financial success

Vision Internal business

Customer and process
Strategy Operational goals for internal
processes

Learning and growth

Intangible factors of
success
Learning from experience
 KEY AREAS IN BSC (contd.)
FOUR PERSEPCTIVES BSC HANDLES IN AN ORG ANIZATION

Using the BSC, an organization maps its strategic objectives to specific metrics of performance.

Financial
Financial objectives
Tracking financial success

Customer Vision Internal business

Customer-facing and process
objectives Strategy Operational goals for internal
processes

Learning and growth

Intangible factors of
success
Learning from experience
 DEVELOPING A BSC
DEVELOPMENT BASED ON EACH PERSPECTIVE

Interactions between perspectives or business units are considered to prevent uneven optimization.

Strategic
1 Objectives 2 Measures 3 Targets 4 Initiatives
Long-term to achieve each for each to achieve each
organizational objective measure target
goals

Not every initiative identified should be worked as a Six Sigma project but some could be.
 FOUR-BOX MODEL VS. STRATEGY MAPS
NEW PERSPECTIVE OF THE BSC

Alternatives to BSC

Financial Financial Increase Increase

Lower cost
profitability revenue

Improve
Customer Lower wait time customer
Vision
Internal business retention
Customer and
Strategy process
Increase
Internal Lower cycle
process
Process time
efficiency

Learning and growth Improve

Learning Improve tools
knowledge and
and Growth and technology
skills

Four-box model of BSC Strategy maps

 IMPACT TO THE ORGANIZATION
HOW THE USE OF BSC S TRATEGY MAPS AFFECT AN ORG ANIZATION

Needs Goals

Organization
 IMPACT TO THE ORGANIZATION
EFFECT OF BSC S TRATEGY MAPS

Personal
goals

Timelines

Work Resources
goals
IMPACT TO THE ORGANIZATION (contd.)
HOW THE USE OF BSC S TRATEGY MAPS AFFECT AN ORG ANIZATION

Cause

Effect

BSC
Strategy
Maps
 BENEFITS OF BSC STRATEGY MAPS

The BSC enables the organization to improve in the following ways:

Allows each business unit to work

Easy communication toward a common organizational goal

Transparent and meaningful

Facilitates understanding at all communication of performance
levels of the organization

Effective creation of performance

Better management of information in an report against a balanced scorecard
organization
 KEY TAKEAWAYS

Quality is defined as the degree of excellence of

a product or service and conformance to
Six Sigma is a business methodology that customer requirements
employs a customer centric, fact-based
approach to reduce process variation and
waste There are five phases in the DMAIC process
Define, Measure, Analyze, Improve, and
The five levels in the Six Sigma team are: Control
Stage For Animation
Six Sigma Green Belts, Six Sigma Black Belts,
See example screen here
Six Sigma Master Black Belts, Six Sigma EXAMPLE 1
Champions, and Top Executives EXAMPLE 2 Apartfrom financial accounting, the BSC also
considers internal processes, customer
satisfaction, and learning and growth
Strategy map depicts a chain of cause and
effect relationships between the perspectives
and the relationships that are represented by
interlinked objectives
Quiz
QUIZ
Which of the following phase is not included in the Six Sigma process?
1

a. Define

b. Analyze

c. Control

d. Implement
 QUIZ
Which of the following phase is not included in the Six Sigma process?
1

a. Define

b. Analyze

c. Control

d. Implement

is.d
The correct answer _
Explanation: The Six Sigma Process is known as DMAIC, which consists of Define, Measure,
Analyze, Improve, and Control.
QUIZ
What is a defect?
2

a. When there is a limit to the customer specification

b. When an output meets the customers expectations

c. When an opportunity does not meet customer expectations

d. When there is a non-conforming part or unit

 QUIZ
What is a defect?
2

a. When there is a limit to the customer specification

b. When an output meets the customers expectations

c. When an opportunity does not meet customer expectations

d. When there is a non-conforming part or unit

is.c
The correct answer _
Explanation: A defect is defined as an opportunity that does not meet customer requirements
or expectations.
QUIZ
Which of the following perspectives belong to the BSC approach?
3

a. Customer, supplier, input, and output

b. Process, people, technology, and policies

c. Financial, customer, internal processes, and learning and growth

d. Internal processes, customer, financial, and objectives

 QUIZ
Which of the following perspectives belong to the BSC approach?
3

a. Customer, supplier, input, and output

b. Process, people, technology, and policies

c. Financial, customer, internal processes, and learning and growth

d. Internal processes, customer, financial, and objectives

is. c
The correct answer _
Explanation: The four perspectives in a Balanced Score Card are financial, customer, internal
processes, and learning and growth.
This concludes Lesson 1.1: Six Sigma and Organizational Goals
The next lesson is Lean Principles in the Organization.
THANK YOU