Lessons in
Six Sigma
Lessons in
Six Sigma Truths 72 Must-know T ruths for Managers
Debashis Sarkar
Response Books A division of Sage Publications New Delhi l Thousand Oaks l London
Copyright © Debashis Sarkar, 2004 All rights reserved. No part of this book may be reproduced or utilized in any form or by any means, electronic or mechanical, including photocopying, recording or by any information storage or retrieval system, without permission in writing from the publisher. First published in 2004 by
Response Books A division of Sage Publications India Pvt Ltd B-42, Panchsheel Enclave New Delhi 110 017 Sage Publications Inc 2455 Teller Road Thousand Oaks, California 91320
Sage Publications Ltd 1 Oliver’s Yard 55 City Road London EC1Y 1SP
Published by Tejeshwar Singh for Response Books, typeset in 10.5 pts Palatino by Innovative Processors, New Delhi, and printed at Chaman Enterprises, New Delhi. Library of Congress Cataloging-in-Publication Data Sarkar, Debashis. Lessons in Six Sigma: 72 must-know truths for managers/ Debashis Sarkar. p. cm. Includes index. 1. Total quality management. 2. Quality circles. 3. Six sigma (Quality control standard) 4. Project management—Quality control. 5. Industrial management. I. Title. HD62.15.S26 2004 658.4¢013—dc22 2004003805 Six Sigma is a registered trademark of Motorola, Inc. ISBN: 0-7619–9843–8 (US-PB)
81–7829–367–6 (India-PB)
Production Team: Roshni Basu, R.A.M. Brown and Santosh Rawat
In the memory of my late father Shri. Subhendu Sarkar Who led a life of Six Sigma Excellence. This book is dedicated to the following people who worked silently to make me a better human being Fr Joseph Lombart Dr R K Patel Mr Ashok Mittal
Contents
Preface
xvii
Lesson 1 Six Sigma is a structured problem-solving methodology which is a powerful lever for business improvement
1
Lesson 2 It’s the CEO and only the CEO who can make Six Sigma successful in an organization
5
Lesson 3 Take the members of the senior management team on board with a champions workshop
8
Lesson 4 Precede Six Sigma deployment with an organizational assessment
11
Lesson 5 Create a deployment platoon for the execution of Six Sigma projects
14
Lesson 6 The responsibility for the success of Six Sigma projects lies with the champions
18
Lesson 7 Improvement with Six Sigma entails finding and working with critical X’s in a process
21
Lesson 8 Build solid infrastructure pillars to support Six Sigma in the organization
24
Lesson 9 Appoint a marketing manager for selling and marketing Six Sigma as a product to the employees of the company
28
Lesson 10 The quality council should drive Six Sigma Implementation across the organization
32
Lesson 11 Bolster Six Sigma projects with a solid Review Framework
35
Lesson 12 Becoming a master Black Belt requires a practical demonstration of adeptness in coaching, teaching, facilitation, consulting and mentoring
38
Lesson 13 When hiring a Consultant for Six Sigma deployment, ensure that all laid down criteria are met
42
Lesson 14 Beware of the Consultant who gives a Proposal to improve an Organizational viii
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Business Process all by itself, without the involvement of employees
46
Lesson 15 Continuously evaluate the effectiveness of Six Sigma teams
49
Lesson 16 The composition of the Six Sigma project team is critical to its success
52
Lesson 17 During the First Year of Six Sigma implementation, focus of deployment should be on Value and not Volume
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Lesson 18 Appoint a Dashboard Manager who is entrusted with the responsibility of tracking process metrics
59
Lesson 19 Six sigma deployment should precede with the identification of Core Business Processes
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Lesson 20 Do not take up Improvement Projects in the cafeteria during the early days of Six Sigma journey
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Lesson 21 Black Belts should not carry out small improvement projects (read: Green Belt projects) in the garb of those being Black Belt projects
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Lesson 22 The project charter is a tool to manage, control and approve Six Sigma projects
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Lesson 23 Scripting the problem statement right is vital to a Six Sigma project
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Lesson 24 An effective Six Sigma deployment requires a holistic mechanism to capture the voice of the customers
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Lesson 25 It is important to focus on the Right Measure to ascertain the efficacy of a process
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Lesson 26 Together with Sigma levels keep an eye on the class of the process
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Lesson 27 While executing DMAIC projects do not take short cuts. Follow all the steps
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Lesson 28 It is imperative that all Six Sigma projects provide Real Time Savings
90
Lesson 29 Just by calculating the potential benefits in the beginning and accrual benefits at the end of a project, will not get the ‘wow’ from either the CFD or his team members
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Lesson 30 Six Sigma methodology is just not for manufacturing organizations. It can be deployed in service organizations as well
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Lesson 31 Be on top of meetings. Let them be enablers to project improvements
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Lesson 32 Before setting out to do a Six Sigma project ensure that it is scoped well
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Lesson 33 The organization should have an effective methodology to ensure that there is a continuous flow of ideas
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Lesson 34 All improvement ideas need not qualify as candidates for Six Sigma project
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Lesson 35 Creating the right organizational structure is essential for Six Sigma deployment
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Lesson 36 Before determining the sample size and sampling plan, ascertain if the data for measurement is from a moving process or is it from a stagnant population
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Lesson 37 Understand the key terms and the steps involved in DPMO calculation
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Lesson 38 DPMO is a good concept but be alert about the confusions it can create. Mindlessly increasing the Opportunity Levels can Increase the Sigma Levels
123
Lesson 39 Do not be satisfied merely with Yields, commence with the calculation of a First Pass Yield
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Lesson 40 You can unfurl the non-value added activities in your process from DPU levels by a measurement called the Rolled Throughput Yield
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Lesson 41 Defects in a Six Sigma process without a shift is 2 Defects Per Billion and not 3.4 Defects Per Million opportunities
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Lesson 42 Get a sense of whether Six Sigma is delivering value through the measurement of Quality Costs
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Lesson 43 When a process capability is reported, ascertain if it is a long-term or short-term capability
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Lesson 44 People at the top should have a gut feel of the happenings at Ground Zero
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Lesson 45 As a Six Sigma change agent, master the art of conflict resolution
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Lesson 46 A defect is one which does not meet the customer needs
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Lesson 47 Do not wait for problems to occur to initiate improvements through Six Sigma projects. Proactively take actions when precursors and evidences to a problem are seen
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Lesson 48 Look at processes end-to-end while taking up projects for improvement
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Lesson 49 Do not launch Six Sigma with the sole idea of saving cost for your organization
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Lesson 50 Select the best performers to take up Six Sigma projects
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Lesson 51 Be extremely meticulous about the Book of Knowledge being followed by the trainers to prepare your Black Belts or Green Belts
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Lesson 52 ISO 9001:2000 Quality Management System serves as an excellent platform for Six Sigma deployment
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Lesson 53 Banish waste by enmeshing Lean Thinking with Six Sigma methodology
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Lesson 54 Appoint a Chief Process Facilitator for all Six Sigma team processes in your company
171
Lesson 55 While focusing on primary metrics do not forget to keep the secondary metrics on the radar
174
Lesson 56 Six Sigma deployment may be a mirage for small sized companies but there are ways to go about it
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Lesson 57 Do not get perturbed if data points in your Six Sigma project have a non-normal behaviour
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Lesson 58 Deployment of Six Sigma does not come cheap. Keep this in mind before setting out on a Six Sigma journey
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Lesson 59 Avoid pre-conceived solutions from getting Force-fitted into a Six Sigma methodology without any data analysis
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Lesson 60 The Human Resource Department cannot be a sleeping partner in Six Sigma deployment
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Lesson 61 Six Sigma framework does not act at cross purposes in an organization’s journey towards achieving business excellence
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Lesson 62 Once processes are improved using Six Sigma methodology, it is important to take an all encompassing approach to ensure that the improvements are sustained
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Lesson 63 Process audits are an integral part of Six Sigma deployment
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Lesson 64 Use Brown Bags to make your employees refresh their knowledge on Six Sigma tools and techniques
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Lesson 65 Bolster your Six Sigma journey with a Solid Rewards and Recognition Scheme
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Lesson 66 Remember to work on mistake-proofing when implementing Six Sigma solutions
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Lesson 67 Be ruthless if Six Sigma objectives are not met
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Lesson 68 In case control charts are not being used by process team members, replace it with pre-control charts
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Lesson 69 Six Sigma is not an off-the-shelf solution to organizational pains
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Lesson 70 Statistical thinking should be a way of life in a company working towards Six Sigma deployment
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Lesson 71 Six Sigma project team leaders need to have focus, good relationships, communication skills, ingenuity and excellent project management skills to translate the charter into results
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Lesson 72 Do not be complacent if processes have reached at Six Sigma levels
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Index
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Preface
Six Sigma is probably one of the best methodologies to pervade the world of improvements. What differentiates Six Sigma from other quality methodologies is its measurements orientation, rigorous training scheme, process centricity and stakeholder involvement. The tools in Six Sigma are not new but its direct linkage to business objectives and priorities, makes it a powerful strategy in business. However there is a word of caution……. Six Sigma is a great methodology but often fails to deliver sustained benefits when we forget the small little things that make a large difference. This book unfurls some of those little things which are often lost and missed during Six Sigma implementation. The Lessons are essentially learnings captured during Six Sigma deployment. The lessons may be ‘common’ and mundane but are quite ‘uncommon’ in workplaces. As far as possible the book has been kept bereft of jargons so that it can be understood by all and just not Six Sigma professionals. A book like this does not happen easily without the help of people who work and support silently behind the scenes.
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Chapal Mehra (Managing Editor, Response) and Sunanda Ghosh (Head Marketing-Sage) for always acceding to my unreasonable requests. This is not my first book with Sage but I can just say its always a delight working with the team at Sage. My mother, my wife Sudeshna and my little one Trisha who have borne with my selfish pursuits which is often at the cost of spending time with them
Please note that the lessons in this book are as observed/experienced by me as a student of quality and Six Sigma. It is quite possible that you may not agree with some of them. Should you have any feedback please feel free to write to me at
[email protected] Debashis Sarkar
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Lesson 1 Six Sigma is a structured problem-solving methodology which is a powerful lever for business improvement
Six Sigma is a data driven structured problem-solving methodology for solving chronic issues facing a business. It is a breakthrough management process that is used to improve a company’s performance by variation reduction. The method encompasses breaking down the customer’s requirements into steps to pinpoint pains in a process. This results in the reduction of defects and sustenance of process improvement. The Six Sigma methodology essentially has two elements which comprises the voice of the customer and voice of process. It essentially entails reducing the gap between the two voices and ensuring that they both match. What differentiates Six Sigma from other quality methodologies is that it can be used to solve key business pains. For the first time we have a methodology which can help quality professionals to add directly to the top line DEBASHIS SARKAR
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or bottom line. Earlier quality professionals always faced a struggle because the impact of their work was often not felt in the company’s balance sheet. Six Sigma has changed all of this. This methodology can be leveraged to address issues which can be used in any part of the business. Traditionally quality tools have been used for solving only quality issues but this tool facilitates the resolution of pains beyond the domain of quality. Some areas where Six Sigma projects can be very effectively used are: Revenue Generation, Cost Avoidance, Productivity Improvement, Customer Satisfaction, Customer Retention and so on. This is just a partial list and can be further increased. Six Sigma gives an excellent project management framework wherein all power tools are packaged in such a manner that it helps in providing the best solution to a problem. Tools used are not new but the way they have been structured gives its power. Six Sigma uses a handful of powerful tools of statistics instead of getting lost in over 400 tools of Total Quality Management (TQM). The beauty of the method is in its ability to use these tools in a model known as DMAIC (Define-Measure-Analyze-Improve-Control). Also, Six Sigma has added a component of financial accountability and demands a strong focus on measurement to constantly monitor the results of the improved state. The Six Sigma framework has also taken quality from the domain of quality professionals to others in the organization. This is probably the best thing to happen. Earlier there was always a struggle to ensure that quality seeps deep and wide in organizations. Despite 2
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all the efforts and various initiatives, progress was not as expected and it only ended with the jargon ‘quality is everyone’s business’. Six Sigma puts a stop to gut-based solutions and looks at all variables affecting a process. The solutions are validated statistically so that the chances of implementing a wrong solution goes down. It can be used for both service and manufacturing organizations. Earlier all quality tools had been manufacturing centric but now this power packed method has been successfully used in service companies. What makes Six Sigma different is that it forces individuals to define customer satisfaction measures and use teams to improve it. So it uses customer-focused goals and measurements and drives continuous improvement at all levels of the enterprise. When effectively implemented, the Six Sigma technique can help to ensure that both internal and external customers voices are heard and efforts are made towards their improvement. The power of Six Sigma can be leveraged by setting attainable short-term goals while striving for long range objectives. It is imperative that the projects support the company and division goals that flow from top-level company objectives. For making Six Sigma a success, it should be treated as a business strategy and not just another quality programme. Remember, the ideal project should have a connection to strategic objectives, should be recognized as being important to the company, can be completed within a reasonable time period, has the support of the management and has an accurate evaluation framework to ascertain its effectiveness. DEBASHIS SARKAR
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Let me caution that Six Sigma is not a panacea for all ills plaguing a company. If there are events outside the organization’s control, Six Sigma cannot be of any benefit. For example, an economic crisis affecting the performance of a company cannot be solved by Six Sigma. It has been seen that with the change in the leadership of a company, the Six Sigma implementation can go to docks. It shall stay till there are leaders like Jack Welch who give it the required thrust and understand its power. Six Sigma Takeaway Six Sigma as a business strategy increases customer responsiveness, builds customer relationships, improves organizational resilience to respond to market conditions and aligns people and processes behind agreed objectives.
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Lesson 2 Its the CEO and only the CEO who can make Six Sigma successful in an organization
Six Sigma should not be launched if the CEO does not have the time for it or does not think it to be important. Six Sigma should also not be launched because the CEO feels it is the latest from the quality stable. It should only be launched when the CEO is convinced that it is the methodology that is required for his/her company. He/she should have a strong rationale on how Six Sigma can be a contributor to specific organizational objectives. I strongly believe that it’s only the CEO who can make a difference to a Six Sigma implementation. Internal experts such as Black Belts and Green Belts may implement Six Sigma projects, but it is the CEO who owns them. Whether it’s Bob Galvin at Motorola or Jack Welch at GE or Larry Bossidy at Allied Signal, it’s their personal commitment and belief in Six Sigma that made the difference. These leaders have given a new DEBASHIS SARKAR
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definition to quality and proved that it can be a lever for business improvement. The CEO cannot just sign the cheque and take a back seat. He or she should understand what Six Sigma is all about and how it drives improvement to the organization. He or she has to provide leadership and create a vision, provide necessary resources, give time, review and communicate to all that Six Sigma is the improvement engine that will be the DNA of the organization. It is his/her responsibility to ensure that everyone gets involved in the implementation effort. The CEO has to provide visible support to Six Sigma. Remember, Six Sigma quality is more of a cultural imperative that changes the way decisions are made. The CEO has to walk the talk and manifest that he or she lives by the Six Sigma framework day in and day out. The culture that is built ultimately converts good strategy into effective execution. So what are the specific things a CEO should do to make Six Sigma successful: l
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Understand what Six Sigma is all about and how it can be enmeshed with the business strategy. Create a shared vision that supports Six Sigma. Be the biggest messiah and evangelist of Six Sigma in the company. Establish clear long-term objectives at a business level wherein Six Sigma methodology can be leveraged (as 10X improvement in quality levels).
LESSONS IN SIX SIGMA
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Lay down clear expectations from the senior management team on their deliverables from Six Sigma. Hold oneself and the senior management team accountable to Six Sigma deployment. Ensure that Six Sigma process improvement projects are directly aligned to organizational goals. Review progress on a regular basis. Set up a senior management team that oversees Six Sigma implementation. Provide all required resources in terms of monies and infrastructure to make Six Sigma successful.
Six Sigma Takeaway The CEO should not treat Six Sigma as a quality programme but should ensure that it becomes a cultural platform which changes the organizational fabric.
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Lesson 3 Take the members of the senior management team on board with a champions workshop
Recently I received a call from an executive who worked for a well known organization which had embarked on a Six Sigma journey. He asked me how to explain to senior management team (champions) that Six Sigma projects require specific steps to be followed and that projects cannot be completed in two–three weeks, as demanded by some of them. There were other champions who doubted the effectiveness of Six Sigma and even said that it was another of those flavour of the month management concepts that the company had embarked upon. He also told me that such notions persist despite the fact that Six Sigma was driven by the CEO himself. On probing, I got to know that the organization had commenced with Six Sigma deployment after the CEO had visited a few American companies which had reaped huge benefits from this methodology. Here was a case of an organization which had commenced with a Six Sigma journey without taking 8
LESSONS IN SIX SIGMA
the buy in of the senior management team. Ideally, before embarking on a Six Sigma journey, the senior management team should be taken on board and must know what Six Sigma is, what rigour it requires and how it is different from other quality methodologies. This is why a senior management workshop or a champion’s workshop should be organized before commencing on a Six Sigma journey. Through this workshop the champions are taken on board on all that is required for successful Six Sigma deployment. Champions receive extensive training on the basics of Six Sigma, project selection, management of Black Belts and Green Belts, change management and so on. Such workshops could either be organized in-house or members could be sent to programmes outside the organization. The champion’s workshop is extremely vital as it sets the tone for Six Sigma implementation. Since champions are typically senior management staff such as business heads or functional heads, the programme should deliver the maximum value in the shortest possible time. It always helps to get an eminent Six Sigma practitioner for such a workshop. Remember, this is required because the attendees of this workshop are senior people in the organization and the workshop should convert them from cynics to Six Sigma advocates. If you are organizing a Champion’s Workshop or choosing one for them, please ensure that at least the following elements are covered: l l
What is Six Sigma? Why Six Sigma? DEBASHIS SARKAR
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l l l l l l l l l
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Success Stories. Basic Statistics. Basic Six Sigma Tools. Why is measurement important? Traits of an effective measurement system. Introduction to Process Capability. Introduction to Minitab. How to go about Project Selection? Infrastructure for Six Sigma deployment (Rewards and Recognition, Reviews, Communication framework, Project Management wherewithal etc.). How to manage change? Six Sigma and culture building.
Do not increase the duration of a champion’s workshop beyond two days. The success of the champion’s workshop lies in converting senior management to Six Sigma advocates in the shortest possible time. It is the champions who drive Six Sigma and have the responsibility of making it a success. Six Sigma Takeaway Till Champions are not convinced with the power Six Sigma, it makes no sense to go ahead with deployment.
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Lesson 4 Precede Six Sigma deployment with an organizational assessment
After the CEO and the senior management have undergone a Six Sigma alignment workshop (also called: champion’s workshop), set up a core team which is vested with the responsibility of making Six Sigma an integral part of the organizational fabric. This team should comprise the functional heads, business heads (in case the company has a number of business units or profit centres) and the quality head (also called the quality leader). The first activity of this core group shall be to carry out an organizational assessment on the pointers mentioned below. This should be carried out by talking to key people in the company and interviewing key customers and suppliers. l l
Have processes been defined and mapped? Are there process owners for the processes?
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What sort of measurement system exists to ascertain effectiveness and efficiency? Are the customers, suppliers, inputs and outputs of key processes identified and known? Is the voice of the final customer/end user (or consumer) captured? Are consumers asked what is important for them? What sort of corrective actions exist, when there are consumer issues? What sort of competitive information do we have ? Does everyone in the organization know who his/her customer is? What sort of rewards and recognition mechanism is in place for quality improvement/consumer issues? How are conflicts handled? Is the organization person dependant or process dependant? How are decisions taken ? Who takes them and are they fact based? Are people aware of the organizational objectives and plan? How is training and development decided upon?
The objective of the exercise is to ascertain business units which would be votaries of Six Sigma and businesses which would face resistance. It shall also throw up business units where Six Sigma should be piloted or taken up. For example, process improvement 12
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through DMAIC rigour cannot be carried out if processes are not well defined (This has been discussed in detail in some other Lesson). The organizational assessment helps in scripting a deployment strategy and unfurling the underlying culture. Companies who have tried to imitate Six Sigma driven companies without considering their underlying culture have met with disastrous results. If the company’s culture is not conducive to Six Sigma, the culture must be changed before a Six Sigma programme can succeed. Six Sigma Takeaway The culture of a company should provide a milieu which encourages problem solving, excellence and continuous improvement through Six Sigma deployment.
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Lesson 5 Create a deployment platoon for the execution of Six Sigma projects
While setting out on a Six Sigma journey, it is important that a deployment platoon of Six Sigma experts is created within an organization. This is required as these experts are responsible for driving change across the company. Unlike the other quality frameworks, the biggest achievement of Six Sigma has been that it has moved improvement out of the domain of quality function and taken it all across the company. The hurdles faced by the earlier methodologies were that improvement was primarily driven by the quality group as a result of which there were often issues of ownership during implementation. In case of Six Sigma this has been overcome as it has been treated as a strategy for business improvement and not just quality improvement. In Six Sigma, what happens is that the improvement tools are handed over to people outside the quality function.
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It has been seen that the structure given below has been most commonly followed in Six Sigma deployment:
Champions He or she is a senior manager who oversees the Six Sigma projects. The person is mainly responsible for providing direction on project scope and takes the onus of ensuring that the project is successful. The role of a champion is discussed in detail in another Lesson.
Master Black Belts (MBBs) They act as internal coaches to Black Belts and are responsible for a set of Black Belts to reach their project goals. He/she must have successfully completed a number of Black Belt projects. He or she is generally a statistical and change management expert who regularly deals with resistance to change and resolves team conflicts. They often serve as change management consultants to the senior management. They not only have the knowledge of advanced tools and business but also leadership training. A primary MBB role responsibility is training and mentoring new BBs in the organization. Certification as an MBB requires 20 successful projects, about half of which are as a Black Belt and half while mentoring BBs.
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Black Belts (BBs) They are full-time quality positions responsible for leading Six Sigma projects. They are project leaders who are selected with different experience and academic qualifications. Black Belts should typically be fast trackers who have a credential for accomplishments. A Black Belt assignment should typically last for two years during which the BBs lead 10–12 projects. BB receive exhaustive training which lasts from anywhere between 10 days to 20 days. To get certified as a BB a candidate needs to complete the classroom training (spread over three to four months), clear an examination and complete a project mentored by a MBB.
Green Belts (GBs) They are employees who carry on with improvements together with their regular work. They are project team members and do not spend all their time on projects. They receive training on participation similar to that of BBs, but possibly for lesser time. In some companies GBs work on small projects (called Green Belt projects) that are directly related to their work. Irrespective of the organization, the champion is a must in Six Sigma deployment. The deployment hierarchies of Master Black Belt, Black Belts and Green Belts are based on company requirements. In some organizations, Master Black Belts are not there and Black Belts are part-time roles. Some companies even have 16
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Yellow Belts or White Belts. Also, the certification requirements may vary from company to company. The above is just a suggested model. I would recommend that a deployment hierarchy is created on the basis of company requirements. Remember, the term Blackbelt has been copyrighted by the Six Sigma Academy. So many organizations use titles such as Leaders, Grandmaster, Champion or Paragons to signify similar training. Six Sigma Takeaway Black Belts can come from any function. When trained adequately and given support, they can become change facilitators in the organization.
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Lesson 6 The responsibility for the success of Six Sigma projects lies with the Champions
Who is a Champion? They are usually people who are working at a level or two below the CEO. They are typically Profit Center Heads, Business Unit Heads and functional heads such as Chief Human Resources Officer, Chief Financial Officer, Chief Risk Officer etc. They lead Six Sigma efforts in their group and are responsible for its execution. If the CEO lays the seeds of Six Sigma, the champion acts as a propellant in his/her group. He/she acts as the gel around whom the Six Sigma initiative is anchored. They leverage the Six Sigma infrastructure created by the corporate quality cell or the Quality Council, to ensure flawless execution. The pillars of this infrastructure are things such as Rewards and Recognition, Communication Plan, Review Mechanism, Project Tracking Mechanism etc. These have been discussed in detail in some other Lesson. The champions facilitate the selection and prioritization of right projects and are 18
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answerable on Six Sigma progress to the CEO or the top management. They are also responsible for increasing the internal capabilities to carry out Six Sigma projects. Most important, they plan the deployment so that no part of the system becomes overburdened as the strategy unfurls, this is especially with respect to data mining. The Champions are expected to play the following specific roles in Six Sigma deployment: l l l
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Own all the projects happening his/her business group or function. Create an overall plan for Six Sigma deployment. Ensure that all projects taken up make a business case and are aligned with the overall organization strategy. Set specific Six Sigma deliverables from team members. Hold team members accountable. Remove hurdles to implementation. Deploy the best people on Six Sigma projects. Review progress on a regular basis. Communicate with Black Belts on a regular basis. Develop synergy between Black Belts and ensure that they are brought together on a regular basis. Personally approve all Six Sigma projects. Ensure that improvements are sustained once the projects get over.
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Continually increase the Six Sigma capability by increasing the number of certified Green Belts or Black Belts.
Remember, champions are the key element in the success of Six Sigma implementation. Before anybody else, they should be the first one to be taken through an awareness workshop which demystifies the Six Sigma and explains how it can be used for business improvement. Six Sigma Takeaway The champions should leverage opportunities of each Six Sigma project to ensure that the impact is maximized.
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Lesson 7 Improvement with Six Sigma entails finding and working with critical Xs in a process
Solving problems using Six Sigma methodology can best be described by the following relationship: Y = f (X1, X2, X3 … Xn) Where Y is the dependant output variable or the process output, X1, X2, X3 … Xn are called the independant variable or process predictors, ‘f’ is the function that defines the relationship between the process output (Y) and the process predictor variables (Xs). Y is the effect or the symptom which is caused by the Xs (i.e. X1, X2, X3 … Xn). Output Y is a function of Xs. Six Sigma is all about finding the critical Xs which affect the Y or the output of a process. Traditionally quality professionals have looked at Ys and have tried to work around with it. Six Sigma gives a structure to unfurl the Xs which result in Y. Xs are also called the Key Process Input Variables while Ys are called Key Process Output Variables. DEBASHIS SARKAR
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In Six Sigma, we discover both the controllable and uncontrollable Xs which affect the process output Y. However, the focus is not on all the process variables (or Xs) but to use various tools to identify the few critical Xs and work with them. To elucidate the concept of Xs, let us look at the manufacturing process of ice creams. The diagram below mentions the various Xs which affect the Ys.
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Mapping the process during a Six Sigma project helps to identify not only the flow of events in the process but also the inputs (Xs) and outputs (Ys) in each step. So when a Six Sigma project is done, it is imperative not only to capture the Ys but also the corresponding Ys. When one commences with a Six Sigma project there are many input variables. But as the project progresses through the steps, it is found that only few of the variables contribute to the variation in Y. At the beginning of a process, it is a must to list all possible Xs. But the rigour of Six Sigma is such that by the end of the project only a few critical Xs get prioritized which are then worked with. This is aptly explained by the diagram below:
MEASURE # 30 – 50 inputs ANALYZE # 8 – 12 Xs IMPROVE # 6 – 8 Xs CONTROL # 3 – 6 Xs
Six Sigma Takeaway Most variations in Ys (outputs) are affected by initial few Xs.
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Lesson 8 Build solid infrastructure pillars to support Six Sigma in the organization
An effective Six Sigma deployment requires the following pillars which keep the wheels of a Six Sigma moving. It comprises the following:
A. Operational pillars These refer to the paraphernalia required for effective execution of all Six Sigma projects. t
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A.1. Roles of People Involved in Six Sigma—This refers to the roles that people have to play in Six Sigma improvement teams. This has been discussed in detail in another Lesson. A.2. Project tracking and monitoring Implementation—This is the mechanism to track and monitor projects under execution.
LESSONS IN SIX SIGMA
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A.3. Review Architecture—This is the review of projects that are underway both for timeline and Six Sigma rigour. A.4. Helpdesk—Six Sigma on Call—As teams commence with projects it makes great sense to institute a help-desk which takes care of all queries of Six Sigma teams. This helpdesk should be manned by Master Black Belts who have prior proficiency in this field. A.5. Rewards and Recognition—Rewards and Recognition should bolster Six Sigma deployment by recognizing achievements and reinforcement of behaviours that drive Six Sigma. A.6. Framework for Effective Meetings—As meetings are an integral part of all projects it is necessary to put in place a framework for effective meetings. All project leaders should be trained on running effective meetings. A.7. Benefits Tracking—This refers to putting in place a mechanism to track benefits accrued from each project. What is required is a corporate guideline on Six Sigma benefits calculations.
B. Fundamental pillars These are the essentials for driving Six Sigma as an organizational initiative. t
B.1. Communication—A organization-wide communication strategy should support Six DEBASHIS SARKAR
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Sigma deployment to ensure it seeps deep and wide within an organization. B.2. Senior Management Review—This refers to the CEO’s review with business leaders or business heads or functional heads or a CEO’s direct reportee; to ascertain progress. This is to gauge the Six Sigma penetration and improvements within a business or functional unit. B.3. Nurture Project Sources—It is important that your organization should have a continued source of potential projects. This could be achieved by project selection workshops, brainstorming, suggestion schemes, and improvement ideas received in the Knowledge Management page. B.4. Leverage the Learning through a Knowledge Management Platform—The learnings of each project should be shared with the rest of the members in the company. B.5. Capability Building through BB/GB programmes—This refers to the ongoing initiative to increase the breed of Black Belt and Green Belt within the organization. B.6. Create a Process Council—This is required to identify processes that are taken up for improvement. This council comprises operating managers from various functions within a business. B.7. Process Audits—This is required to ascertain the health of the improvements and to see if they have sustained after project completion. B.8. Dashboards—The organization should regularly get an overview on the status of LESSONS IN SIX SIGMA
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various projects through dashboards. It may be a good idea to appoint a Dashboard Manager for this purpose. B.9. Create a Quality Council—This is the council of senior management who oversee the implementation of Six Sigma. The responsibility of the success of Six Sigma depends on this group.
Without the above pillars, setting out on a Six Sigma journey may not be effective. It is important that a high powered team led by an MBB or Head–Six Sigma is made responsible for infrastructure creation. The progress of pillar creation is reviewed on a regular basis by the Quality Council. If the foundation of the pillars are weak, Six Sigma implementation will get derailed. Six Sigma Takeaway The infrastructural pillars are the foundation on which Six Sigma implementation is set on sail.
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Lesson 9 Appoint a marketing manager for selling and marketing Six Sigma as a product to the employees of the company
It may sound quite radical that a marketing manager for an improvement initiative as Six Sigma is being proposed! To some this may appear strange as marketing managers are required for selling products to consumers and not for selling Six Sigma to an organisation. It may be further suggested that if the CEO is committed and drives Six Sigma; things shall happen and a marketing resource should not be squandered. Although there is no substitute for the CEO’s commitment in an organization’s Six Sigma journey, the marketing manager is needed for a different objective. While the CEO sets the vision for Six Sigma implementation, the marketing manager sells the concept of Six Sigma to employees. He will do so like selling a product to consumer. The marketing would take the message of Six Sigma across the firm. 28
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By CEO’s mandation Six Sigma projects will happen but for Six Sigma to become an integral part of organizational DNA, it should be moved by the hearts and conviction of people. This shall happen when someone sells and continuously communicates the benefits of Six Sigma to the organization. The marketing manager of Six Sigma should be mandated to sell the brand Six Sigma to all within the firm. You may say that the Head—Quality or Head—Six Sigma, can take up this position. Yes, it can be done. But the problem is that typically, the Head—Quality or Head—Six Sigma is not a person who has the required marketing skills. What I am suggesting is a person from the marketing or selling function, who has prior marketing/selling experience in selling products/ services. This is because he/she will have the required skills of marketing a product (Six Sigma here) which a quality/Six Sigma professional may not possess. Yes, for the long-term success of Six Sigma, it has to be sold as any other goods are sold to the customers. So what should you do after picking up a bright person from the marketing or sales function is to train him or her on Six Sigma. The best thing would be to make the individual undergo a Black Belt or Green Belt training programme, ensure that he or she completes a projects and gets certified as a Green Belt or a Black Belt. This is required because if we want the person to sell quality, he or she should know what it is all about and what it takes for execution. The job essentially encompasses selling and institutionalizing Six Sigma across the Six Sigma. This person could report to the Head—Quality/Head—Six Sigma and be entrusted with the following headline responsibilities: DEBASHIS SARKAR
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Establish and communicate the key distinctive benefits of Six Sigma deployment. Create presentation and promotional materials for Six Sigma. Design various kinds of publicity programmes to promote the cause of Six Sigma in the company. Do personal selling on what is Six Sigma and how it can be a lever for business improvement. Use the telephone, e mail, internet and knowledge management platform; to communicate directly with employees. Identify influential individuals within employees (such as the union leader) and devote extra time with them on the power of Six Sigma. Work towards developing word-of-mouth referral channels so that people look forward to get associated with Six Sigma projects. Create awareness on Six Sigma among employees through ‘Six Sigma Awareness Workshops’ which should be made compulsory for each employee. Share success stories of Six Sigma deployment within and outside the company.
The following is a list of common communication platform that an organization can use for Six Sigma deployment:
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Brochures, Booklets, Posters, LESSONS IN SIX SIGMA
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Leaflets, Billboards, Audio-visual material, Videotapes, Contests, Quizzes, Exhibits, Seminars, Publications, Events, Presentations, Six Sigma query meetings.
Six Sigma Takeaway To make the communication of your Six Sigma marketing manager effective, ensure that the individual qualifies as a Black Belt or Green Belt before taking up this assignment. Remember, communication is going to be considered effective where the source is believed to have expertise.
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Lesson 10 The quality council should drive Six Sigma implementation across the organization
Set up a Quality Council that comprises the Chief Executive and the top management team who can oversee Six Sigma implementation across the organization. The quality council should meet on a regular basis to guide, review and plan for Six Sigma implementation. Also called the Leadership Council or Six Steering Committee, the main responsibilities of this group are to define and prioritize the quality improvement objectives and to maintain the correct rate of implementation. The following is a list of roles which should be played by a Quality Council in a Six Sigma journey: l l l l
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Establish a vision and script an overall Six Sigma implementation roadmap. Select specific processes for improvement. Remove barriers to implementation. Ascertain and address cultural issues in implementation. LESSONS IN SIX SIGMA
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Ensure that the best people are selected for Six Sigma projects. Define Six Sigma objectives for the entire organization which includes people at the senior level. Ensure that improvements are quantified and determine how they impact bottom-line. Support and commit the assignment of resources. Assess the performance of Six Sigma projects to ensure its continuing suitability and effectiveness in ensuring customer satisfaction. Review progress of current projects and the findings of internal audits of closed projects. Review quality costs and where Six Sigma can be used for betterment. Select process owners for core processes. Ensure measurements are established for all completed projects. Demand solid results. Resolve and remove escalations and conflicts. Ensure that the Six Sigma capability of the entire organization increases. Ensure that the basic infrastructure is in place before Six Sigma implementation. Involve suppliers in Six Sigma implementation and collaborate with them. Show constancy of purpose. If you promise something, then deliver it. All members of the Quality Council must walk the talk, and maintain the vision, drive and passion. DEBASHIS SARKAR
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If your organization has multiple business units, it would be a good idea to have a Quality Councils both at the apex level of the company and within each business unit. Please do not undermine the role of the Quality Council in Six Sigma implementation. They play a critical role in identifying the right projects and ascertaining the best ways to roll out the initiative to maximize impact. In certain organizations the Quality Council also functions as a Process Council which has been discussed in another Lesson. Six Sigma Takeaway The Quality Council should work towards creating a culture that nurtures Six Sigma implementation.
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Lesson 11 Bolster Six Sigma projects with a solid Review Framework
Reviews are an integral part of Six Sigma implementation. The main objective of reviews is to check achievement against plan, check timelines and decide actions to meet gaps. Other objectives include ensuring that earlier committed actions have been carried out and have delivered results. It is an opportunity to understand and support cross-functional activity in Six Sigma projects and to unfurl barriers to implementation. Reviews also play a critical role in Six Sigma Project Management. The following are the types of reviews commonly used during Six Sigma projects: l
Regular Reviews (Timeline Reviews)
These reviews are to be done by the Champion with the objective of ascertaining adherence to timelines and barriers to implementation. These reviews should not DEBASHIS SARKAR
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take more than 15 minutes and should be centered around determining the progress against a Gantt chart that shows progress. These reviews should be extremely efficient and discussed in minimal detail. In certain organizations these are referred to as stand-up meetings, stressing that they serve as updates and are short in duration. These reviews typically happen on a weekly basis. l
Tollgate Reviews
These reviews are targeted in ascertaining the DMAIC rigour being followed in Six Sigma projects. The Master Black Belts typically chain these reviews. In case an organization has commenced its Six Sigma journey, it may hire external consultants (read: Six Sigma experts) who facilitate these reviews. The review is also an opportunity for the Black Belts/Green Belts to address their queries on statistical tools and concepts. It would be a great idea if the Champion is also present in these meetings. The Black Belt or Green Belt should not be allowed to continue onto the next phase until approval for the same has been received from the Master Black Belt and the Champion. These reviews ensure that the Six Sigma methodology is followed and the appropriate technical tool is used. In technical reviews there is a set of process questions after each step which need to be addressed. The Tollgates are an opportunity for Managers, Champions and Master Black Belts to listen to the teams, ask questions to ensure that the team is focused on strategic objectives and guide the team on tools and techniques. Tollgate Reviews are also called Technical Reviews. 36
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The above are typically used during project execution. However, the status of improvement is subsequently reviewed during monthly quality reviews held on a regular basis. In these reviews the trends of key process metrics and audit findings for completed projects are reviewed. Remember, these reviews are not Tollgate Reviews or Timeline Reviews, as discussed above. These are quality reviews that are held to ascertain the state of quality in an organization and Six Sigma projects are a part of it. Other agenda items of such reviews are Customer Complaints, Quality Management System Compliances, Audit Findings etc. Six Sigma Takeaway Six Sigma projects should not be allowed to continue to the next phase until Tollgate Reviews have been completed.
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Lesson 12 Becoming a Master Black Belt requires a practical demonstration of adeptness in coaching, teaching, facilitation, consulting and mentoring
The other day I was talking to the Deputy Managing Director of a manufacturing organization. He mentioned that his organization had commenced with Six Sigma implementation. Further he shared that they had appointed their Director-Operations as a Master Black Belt (MBB) who would oversee the implementation. While there was nothing wrong with the DirectorOperations being an MBB, what appeared queer was how could a person who did not have prior experience in Six Sigma become an MBB. Also, this reflected that the organization had not understood the roles and responsibilities of a Master Black Belt. So who are these Master Black Belts? They are super Black Belts whose depth with Six Sigma methodology and strong leadership skills make them Master Black Belts. They are technical specialists 38
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who train, coach, facilitate, consult and mentor other Black Belts. They are one of the prime drivers of the Six Sigma implementation and coordinate mega projects which run across the functions in an organization. So what are the key roles of a Master Black Belt? l l
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Create infrastructure to facilitate Six Sigma deployment across the organization. Help business leaders and Champions to develop a list of projects in their respective business groups. Coach, train and mentor Black Belts on their projects, tools and conflict resolution. They play a stellar rule in helping BBs to interpret results. Together with the dashboard manager, MBBs help in setting up a measurement system on projects and organizational performance measures. They coordinate mega projects and facilitate the technical review of all Black Belt projects. The MBBs run a project management infrastructure to monitor the progress of Six Sigma projects. Do training and workshops for Champions, Black Belts and Green Belts. Work closely with Champions on deployment tactics. Communicate the firm’s strategic potential from Six Sigma deployment to the top management.
The selection of a Master Black Belt commences with the Black Belt Training programme and continues DEBASHIS SARKAR
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through the execution of the subsequent projects. Do not be hasty in selecting MBBs. Please ascertain if he/ she has the relevant skills and aptitude. Also, determine if his/her career move as an MBB is aligned to his/her long-term career goals. So what does it require to become a Master Black Belt? It has been discussed in an earlier lesson but let me re-emphasize that a certification as an MBB requires 20 successful projects, about half of which are as a Black Belt and half while mentoring BBs. They should have achieved mastery on advanced statistical tools such as Design of Experiments, Quality Function Deployment, Failure Mode Effect Analysis, Analysis of Variance and so on. They should have excellent communication, facilitation and inter-personal skills; and should manifest the ability to work across functional boundaries. They should have experience in training Black Belts and should have conducted workshops for them. After selection of a candidate for the position of a MBB, he/she has to undergo a two weeks programme which prepares candidates for the role of a MBB. Remember, a MBB should not only possess technical skills but should also be a good leader to make Six Sigma an integral part of the organizational fabric. So do not undermine the leadership skills while focusing on technical abilities. When an organization sets out on a Six Sigma implementation it may not have a Master Black Belt so it is recommended that a Six Sigma expert or a consultant is hired.
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Six Sigma Takeaway Master Black Belts should work with Champions to increase the DNA of Six Sigma experts.
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Lesson 13 When hiring a Consultant for Six Sigma deployment, ensure that all laid down criteria are met
When Six Sigma is new in your organization, hire a consultant who will assist in the roadmap, train employees, help in project selection, advise on deployment infrastructure and partner implementation. As with all consultant selection, be extremely careful and do a thorough homework. I would recommend that there is a laid down criteria which is used whenever a Six Sigma consultant has to be hired. For a Six Sigma consultant you should ensure that the quality council comprising the company’s top management team is involved in the selection. The following is a list of areas that you should look at whenever you go out to hire a consultant: o
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Reputation/References: Ask for references and enquire on the companies he/she has asked for. Validate the claims by calling up a few companies LESSONS IN SIX SIGMA
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that he/she has consulted for. The sample should represent a cross section of the industry. You would also require to check if there are any specific industry that the individual specializes in. Credentials: Ascertain credentials such as educational achievements, association memberships, or professional certifications. Is the person familiar with the processes that operate in your industry and has he or she been involved with quality improvement in your kind of industry. Does the consultant possess the desired listening and observation skills. This is because a consultant needs to gather information through listening and observing. Knowledge of Six Sigma Fundamentals: This is a very important criteria in the process of selecting a consultant for Six Sigma. Ascertain the knowledge possessed by the consultants on Six Sigma tools and techniques. Specifically look for information on how they have used these tools in Six Sigma projects in other organizations. Probe on their knowledge of advanced tools as Design of Experiments, Multiple Environment Over Stress Testing, Quality Function Deployment, Benchmarking, Value Engineering, Mistake Proofing, Control Plans, Multivariate Analysis etc. Also, find out the number of Master Black Belts and Black Belts in the group who have had real life experience beyond consulting as team leaders on Six Sigma projects. If the consultants are also going to act as trainers, what is the content of their book of knowledge? What are the various topics covered and how are the corresponding simulated exercises? Six Sigma is also about managing change. DEBASHIS SARKAR
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Please look into their past exposure in bringing about change. Do not hire a consultant who is only a statistician and not a Six Sigma practitioner. Package: To fully evaluate a consultant’s capabilities you would require an assessment of implementation strategy. This should include methodology and a time plan for detailed implementation of the project for which he or she has to be hired, specifically the implementation structure and template that has to be followed. Also, it must be decided whether the consultant is just a trainer or someone who is going to partner with all elements of Six Sigma deployment. Flexibility: Does the consultant have a repertoire of providing flexibility, which should include the ability to change the plan without losing sight of the ultimate objective. He or she should be able to complete tasks and achieve milestones without disrupting the normal course of the business and should blend in with the employees without affecting their work. Costs: Establish how many on-site days will be required to complete individual tasks. What costs would be incurred and what is the expected ROI? Do not hasten while deciding on a consultant for Six Sigma. If it means spending a few more days and a little more money, go for the consultant who meets all the above criteria. Remember, the consultants are going to create the foundation on which the building of Six Sigma is going to be built. So do not compromise. Go for the best. LESSONS IN SIX SIGMA
Six Sigma Takeaway Consultant selection is like finding a wife for yourself, be extremely meticulous and careful in its selection.
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Lesson 14 Beware of the Consultant who gives a Proposal to improve an Organizational Business Process all by itself, without the involvement of employees
Many companies in India are hiring consultants to help them in their Six Sigma journey. While consultants are required, I have discomfort with consultants who are trying to make the quick buck due to the ignorance of the industry. Companies such as Motorola and GE, while implementing Six Sigma, also hired consultants. But they went for the right people who could steer the entire organization towards institutionalizing Six Sigma. Quality stalwarts such as Mike Harry and Keki Bothe were associated with their implementation. The results of their contributions are before us and hence Six Sigma is an integral part of the organizational fabric. It is not that India does not have Six Sigma experts in our country. But companies are hiring Six Sigma preachers who may talk elaborately but lack depth. Organizations get swayed by the gift of the gab and 46
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laptops, without probing deep on their previous work. I am also amazed to see that consultants who were earlier preaching ISO and then graduated to TQM, are now evangelizing Six Sigma. My advice to all organizations is to look at the credential of the consultants before hiring them. I know of a consultancy firm, which deputes fresh business graduates into implementing Six Sigma projects. The client organizations are hardly aware of this or are ignorant of the fact that implementation of Six Sigma requires specific skill sets. Before hiring a Six Sigma consultant, a referral check with organizations has to be done, to validate the consultant’s claim. Find out if they have helped companies to eradicate chronic problems or how many projects they have worked on, which facilitate the achievement of strategic objectives. Ascertain the consultant’s familiarity with all advanced Six Sigma tools. This is important to know because some problems may require advanced statistical tools such as Design of Experiments (DOE), where simple problem-solving tools may not be of help. Be careful of consultants who try to sell the ‘Simple Problem Solving’ methodology under the garb of Six Sigma or consultants who have tied up with some non-descript foreign Six Sigma consultants. The criteria that you should follow for consultant selection has been discussed in detail in an earlier lesson. A few companies have set out on a Six Sigma journey by allowing consultants to improve their processes. Participation of employees is either cosmetic or is absent during the improvement process. As a result, the improvement does happen but rolls back to the original state after the project is over. Please avoid such consultants who run Six Sigma projects without the DEBASHIS SARKAR
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involvement of employees. Instead of building internal capability, such consultants are silently letting organizations to be parasitic to external consultants. To institutionalize Six Sigma in your company, use consultants as facilitators and not as people who are running projects. Six Sigma Takeaway The consultants should act as facilitators and not as people who are running Six Sigma projects.
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Lesson 15 Continuously evaluate the effectiveness of Six Sigma teams
As teams set out on Six Sigma projects ascertain if they are effective enough to deliver the desired results. You may have the brightest of people on the projects but if their energies are not channelized well, they will soon get squandered without delivering the required results. Just knowing the best tools is not adequate, what is required is a team which can keep the engine of the project moving. Proactively ascertain the effectiveness of Six Sigma teams. What are the traits of an effective team for Six Sigma project? l l
The team has clearly defined objectives and a mission. The team’s objective has a clear alignment with the organizational strategy of the company.
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All members of the team are aware of the problem being addressed, project goal and reason why the project is being done. The teams have a Champion who regularly reviews progress. All team members have received training on basics of Six Sigma and team dynamics. There is open communication among all team members. Members take critique and feedback positively. The team members are aware of the specific roles that each one is supposed to play. Decisions are not based on gut and hunches but on data. Team members are aware of suppliers, inputs, customers and outputs of the process under improvement. Team members are empowered and have the authority to take decisions. The team achieves all the pre-decided timelines. The team members spend adequate and required time on the project. Credit is given to contributions of all team members.
Effective teams are required for successful Six Sigma deployment. It is the responsibility of the management to understand how to make teams effective. The management has to keep the teams positively active to produce desired results. Effective teams are only
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possible when there is unstained focus and lot of hard work on the part of management. Six Sigma Takeaway If tools are the sails of a Six Sigma boat, the teams are its engine.
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Lesson 16 The composition of the Six Sigma project team is critical to its success
Every Six Sigma team should have an effective leader who not only provides directions but also understands the team dynamics. The team leader should not only possess technical knowledge but also behavioural and leadership skills to actively engage the members of the group. The Six Sigma improvement team should definitely comprise the following members:
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Sponsor He or she is the person who proposes a project for execution. They have the budgetary authority and pay for the expenses for a successful project execution. In some organizations the role of a sponsor and champion can often merge.
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Champions The champions are responsible for the success of a Six Sigma project. His/her role has been discussed in detail in an earlier Lesson. LESSONS IN SIX SIGMA
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Six Sigma Project Leader This is the person who leads the Six Sigma project. They are typically Black Belt or Green Belts who are adept in the methodology of improvement.
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Process Owner He or she is the person who owns the process from the beginning to the end. The person is responsible for holding and sustaining the gains from the project execution. Process owners are assisted by process operators who work on the process. Core or key processes could even cut across functional boundaries and departments. Depending on the level of management, the ownership of processes shall vary. Core processes are typically owned by senior managers while sub process ownership could rest with the middle management or junior management.
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Process Operator They are the people who work on the process and are responsible for ensuring that process parameters are maintained as desired. Process operators play a major role in ensuring that the gains are sustained. The effective training of operators is a must, in order to ensure that operators manage the process as per the process control plan. The participation of critical operators is a must in the Six Sigma project so that they can own the improvements.
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Process Expert He or she is a person who has an expertise on the process. The person may or may not be a part of DEBASHIS SARKAR
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process, but is typically a subject matter expert who brings in all the theoretical and practical insights of a process. He or she is the knowledge bank among the Six Sigma team members. l
Information Technology (IT) expert He or she is a person who gives the technology support to the project team. In quite a few occasions, improvements require information technology solution and this is where the IT expert plays the role. His or her involvement should be from the beginning of the project to ensure that the right IT solution is effectively designed.
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Representative from the CFO’s office This is the person from the office of the Chief Financial Officer who guides and ascertains the benefits of an improvement project. The role of the CFO’s office in the improvement project has been delved in detail in another lesson.
The above team members are required for the effective execution of the project. For all group level exercises such as brainstorming, FMEA (Failure Mode Effect Analysis), Process Mapping etc., all members must participate. Remember, the larger the participation of the team members in Six Sigma project, the easier is the implementation. I have observed in a few organizations that Six Sigma projects typically remain the baby of the Six Sigma project leader (i.e. Black Belt or Green Belt) and there is cosmetic participation of the teams. Remember, this is a recipe for disaster. 54
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Six Sigma Takeaway The project leaders should never attempt to do everything himself or herself.
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Lesson 17 During the First Year of Six Sigma implementation, focus of deployment should be on Value and not Volume
A well known organization set out on a journey of Six Sigma deployment with a lot of vigour and fanfare. However it was found that after two year’s deployment, the desired impact could be felt for the investments made. This organization had a strength of 1000, of which 100 people had been trained as Black Belts or Green Belts, all of whom executed projects during the first year. Yes, 10 per cent of the organization was working on projects in the first year itself. All these projects had been completed after the CEO had mandated that at least 100 projects be completed within the first year of deployment. The head of the Six Sigma in the organization mentioned that the company had invested around Rs 3 crores on the initiative but had received no tangible benefit, save for the hype and hoopla that Six Sigma was being implemented. The senior management as well as the CEO were turning skeptical about 56
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Six Sigma being another flavour of the month from the den of a quality practitioner. The above is an example of an organization where the focus during the first year of implementation has been on volume (number of projects) instead of the value (benefits/impacts they can deliver). This is a mistake which organizations often commit. Often, in the enthusiasm to reach a threshold, organizations commit too many projects in the first year of deployment. The first year of deployment is extremely critical for Six Sigma’s success. This is the time when the tone of Six Sigma deployment is set in the organization. If people do not taste success after the first or second year of deployment, the initiative shall get completely thrown off. Organizations should consciously treat the projects in the first year as a pilot. It is extremely important that only a few projects are taken up and that the focus is on the impact of the projects and not on the number of projects. All efforts should be geared to make them successful. These projects cannot be anything but only those which are important for the organization. Ensure that the projects are selected by the Quality Council, the membership of which comprises the CEO and senior management. Take up only end-to-end projects (discussed later in another lesson), the impact of which can be felt by the customer as well as the stakeholders. The recommendation is to take up a mix of projects on efficiencies as well as customers. The temptation would be to take up only efficiency projects as we would like to show quick rupee savings. But it is important that we take up projects which also lead to long term benefits such as revenue DEBASHIS SARKAR
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growth, customer loyalty and so on. This is required in order to gain acceptability within the company that Six Sigma can also be used for things other than cost savings/efficiency improvement. Six Sigma Takeaway During the first year of Six Sigma deployment, take up a few but meaningful and high impact projects.
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Lesson 18 Appoint a Dashboard Manager who is entrusted with the responsibility of tracking process metrics
As the number of projects increases in an organization, it is recommended that a position of a dashboard manager is created to track and monitor projects which have been completed. This is important because if the metrics of the completed projects are not looked at, the processes could revert to the original state. This person typically should report to the CEO or his/her direct reportee. This is to ensure that the top management is aware of the status of process performances that had been taken up for improvement. So, what are these dashboards? They are effective ways of communicating the metrics of processes which have been taken up for improvement using the Six Sigma methodology. Dashboards use graphs, charts, pictures or other visual techniques to communicate key process metrics and provide a uniform template for alerting managers to critical issues pertaining to Six Sigma implementation. DEBASHIS SARKAR
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The dashboard manager should alert senior management and champions of exceptional circumstances in a timely manner. He/she should liaise with the process owners to ensure that dashboards are prepared within stipulated timelines and that the information is used for arriving at root causes. The individual should ascertain the impact of deviations on the business objectives and larger goals of the organization; and keep the management apprised of the same. The dashboard manager also works with the organization to devise a policy on what data can be made freely accessible and what should be restricted. The dashboard manager could commence by first implementing the dashboards manually and then graduate to partial automation. But his/her ultimate goal should be digitization, which enables automation of the processes for data entry, analysis and reporting. This will not only increase efficiency but shall also reduce errors. Digital dashboards are also called cockpits, and allow timely access of Six Sigma metrics to key stakeholders. The dashboard manager should have an information technology background and should have a liking for data. A word of caution here is that setting up digital cockpits are often not easy. This is because many of the processes may be manual and automating them may require enormous resources. The other challenges are that often data systems do not talk to each other and there is a lack of standardization of measurement system across the company.
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Six Sigma Takeaway The dashboard manager should create a roadmap for dashboard implementation. He should commence with manual data presentation, move to partial automation and finally target full automation.
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Lesson 19 Six Sigma deployment should precede with the identification of Core Business Processes
Quite often, organizations are not aware of the core business processes, mission-critical processes, key business process or macro processes. It is thus essential that before commencing on a Six Sigma journey you decipher the core processes which support the mission of the company. Organizations convert their strategies to action through processes. Businesses are drawn around functions but it is the processes which deliver the business goals. Understanding the core processes are critical to business success. So what are the attributes of core processes? l
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They are the processes that help in achieving the business goals, fulfillment of the mission and the attainment of its vision. They are the processes that are required for organizational success and is supported by a whole lot of sub-processes. LESSONS IN SIX SIGMA
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They are those processes that provide competitive advantage. They cut across functions and involve numerous departments.
One of the methods of ascertaining the core processes is by a tree diagram where the organizational goals such as market share, increased sales, improved customer satisfaction etc. are documented and then the processes for achieving these goals are linked. Potential Core Processes
Sub-Processes
Deciding the core processes requires the top management’s involvement. Typically organizations have 3– 10 core business processes. The following are examples of the core processes of two companies which I have studied very closely. For the sake of confidentiality, the names have not been mentioned. However, you will get an idea on what core processes are all about. Core Processes of Two Companies Company ABC
Company XYZ
Corporate Governance After Sales Service Design and Development Customer Delivery Process Manufacturing Sales and Marketing Technology
Distribution Supply Chain Research and Development Marketing Manufacturing
Excellence in business can be achieved when the focus is on improving the core processes and there is a DEBASHIS SARKAR
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continuous review on their effectiveness from the customers’ and shareholders’ point of view. You should leverage the power of Six Sigma by working on these processes. Identification of core processes help to redeploy improvement efforts that were previously launched against relatively trivial processes. Six Sigma Takeaway Before deploying Six Sigma identify the core processes in your organization.
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Lesson 20 Do not take up Improvement Projects in the cafeteria during the early days of Six Sigma journey
I am aware of a company which during its early days of implementation took up a project in the cafeteria and parking. There was a major increase in Sigma levels but the impact was not felt much. There was no flaw in the methodology but the organization took up a project which did not have strategic importance. It is imperative that we begin with improving the processes that are linked to the strategy. Randomly selected processes for improvement may not have strategic importance and you will only end up squandering valuable resources. It is not as though projects should not be taken up in a canteen but it is an issue of making choices about which processes to improve and likely trade-offs in resources allocation. Trivial processes such as that of the cafeteria should be taken up when sufficient progress has been made towards improving the core DEBASHIS SARKAR
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business processes. Following are some of the processes which should be taken up for improvement: l
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Processes that support achievement strategic and business goals. Target the core processes which are directly linked to the strategy of the company. Processes that have senior management buyin. Do not take up processes which are not in the radar of senior executives. Process which impact the customers are an ideal choice for Six Sigma projects. It would be a good idea to inventorize all processes that impact customer satisfaction and dissatisfaction. Specifically look for processes which are often touched by customers. Processes which are cost intensive are also a good choice. This means that a 25 per cent improvement in a process that consumes resources worth Rs 10 crore would mean a saving of Rs 2.5 crore. However, this would require that the organization should have detailed process costs which many organizations do not have. Leveraging the activitybased-costing to ascertain the true process cost is recommended. Processes in which your organization is weak vis-à-vis competition. However, the challenge here would be to get the real voice of the processes of the competitors. A good idea could be to decipher this by talking to the competitor’s customers. LESSONS IN SIX SIGMA
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Processes that have a clearly defined process owner. It does not make sense to take up processes which do not have an owner as there will be nobody to implement the solutions. Processes which consume large amounts of material are good candidates for improvement. This is because reduction in wastes would mean improving the efficiency and effectiveness of the process.
It is the onus on the senior management and Six Sigma champions to isolate the trivial processes from vital processes which have significant impact on business. Six Sigma Takeaway Do not use Six Sigma to improve processes which are in transition.
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Lesson 21 Black Belts should not carry out small improvement projects (read: Green Belt projects) in the garb of those being Black Belt projects
A well known consumer goods company had started its Six Sigma journey and had spent a lot of money in training people as Black Belts and Green Belts. However, on a visit to one of their manufacturing units I found a Black Belt working on improving the process for raising purchase orders. On probing I was told that the turn-around time for generating purchase orders was quite high and as a result the supplies to the unit did not often happen on time. This was a clear case of wasting a valuable resource as a Black Belt to work on trivial process improvement projects. This is what happens when an organization does not have clear definitions for a Black Belt and a Green Belt Project. It is imperative that these definitions are explicit and clear so that the resources in Black Belts and Green Belts are deployed judiciously.
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A Black Belt project looks at improving core business processes which help at achieving a business goal. These are typically cross functional, cross regional and cross departmental projects which are run by Black Belts. These projects should yield a significant return to the organization and should be completed within six to nine months. These projects could have any of the objectives such as improving customer satisfaction, optimizing the supply chain, reduction of defects, reduction of cycle time, improvement of first-pass yield, shortening of lead time, reduction of variability, optimization of product performance, optimization of process performance, cutting costs, reduction of the cost of quality, improvement delivery performance and so on. A Green Belt project looks at improving subprocesses of a core business process. These are within departments and are seldom across functions and regions. Green Belts are typically part time Six Sigma resources who take up improvements together with regular work. The objectives could be same as the Black Belt projects but the scale and scope is much smaller. Before creating the cadre of Black Belts and Green Belts, clearly define what comprises a Black Belt and Green Belt project. Six Sigma Takeaway An organization should clearly define what constitutes a Black Belt and Green Belt project.
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Lesson 22 The project charter is a tool to manage, control and approve Six Sigma projects
The project charter is the first step of a Six Sigma project. It is a document that lays down the fundamentals on which the project is run. The charter manages, controls and approves the project that is being taken up for improvement. It is a living document that gives an overview of the project and evolves as it progresses. The charter has to be scripted by the Black Belt or the Green Belt with the help of the champion or sponsor. This is because there are quite a few elements to it that ties up with the larger picture of the business and, as they have been part of the project selection exercise. So what should a project charter contain? It comprises the following: l l l l
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Business case. Problem statement. Goal statement or specific objective desired. Project scope and assumptions. LESSONS IN SIX SIGMA
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Elements out of scope. Stakeholders impacted (departments, customers or vendors influenced by the project). Risks. Champion’s name. Reporting manager of the person driving the project. Team Membership (black belts, green belts, subject matter expert, process owner, representatives of all silos thru’ which the process cuts across, IT support). Project milestones. Expected financial benefits.
An ideal project charter should be a one page (or maximum two page) document. In many organizations it is an integral part of the project tracking software. A charter is like a contract that outlines the resources and support that the champion will provide in return for improvement objectives. A charter also helps teams to avoid projects that have an overwhelming scope and ensures projects are aligned to business needs. Before closing on the charter do not forget to get the champion’s sign off. By signing the charter the champion commits to the project. Six Sigma Takeaway A project charter aids teams to avoid projects that do not make business sense.
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Lesson 23 Scripting the problem statement right is vital to a Six Sigma project
Before beginning your Six Sigma project take all efforts to clearly define the problem statement. If the problem statement is not scripted correctly it can lead to the project going awry. So what is a problem statement? A problem statement is a one or two-line description of the symptoms arising from the pain to be addressed. It is a visible deficiency that is observed in a product, service or a process. Once a pain or a concern has been identified, a problem statement helps to understand it by giving flesh to it. It is a mental representation of what is wrong. It is a description of pain or what is not meeting the customers needs/expectations. It could also be a gap between the existing and desired state. A problem statement should always be weaved in terms that are visible, specific and measurable. It should be of a size and complexity that is manageable. 72
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While scripting a problem statement never talk about solutions or give a preconceived indication of what the root cause might be. Never affix blame in the problem statement and do not base it on a guess or an assumption. A problem statement also bounds and frames the situation by specifying what should or should not be included. It should include a manageable set of concerns. Do not include many problems into one problem statement. A problem statement should answer the following: l l l l l
What has gone wrong? Where has the problem occurred? When did the problem occur? What is the magnitude of the problem? What has been the impact of the problem on the business?
Here’s an example of a good problem statement: Wrong The rework in XYZ flexi machine lying in a biscuit packaging section is at 25 per cent due to the voltage variation. Right The rework in XYZ flexi machine lying in a biscuit packing section is at an average of 25 per cent over the last three months resulting in losses of Rs 132 lakhs to the company. DEBASHIS SARKAR
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Six Sigma Takeaway The objective of the problem statement is the following: (a) Clarifying why the process or system produces the effect that one aims to change, (b) Measuring the performance of the process or system that produces the effect, (c) Understanding the situation that led to the problem.
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Lesson 24 An effective Six Sigma deployment requires a holistic mechanism to capture the voice of the customers
The following is a list of tools that can be used by your organization to capture the voice of customers who have experienced the product or service of your organization: l 1. Global Customer Surveys These surveys are done with the objective to get a feedback of the customers on all issues pertaining to the relationship. It includes elements as product or/and quality, price, image and so on. Such surveys also find out what is important to the customers and what is trivial to them. Global customer surveys can also be used to provide a competitive profile when the same is administered on competitors’ customers who are actually your potential customers. Global customer surveys are typically comprehensive and encompass all
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elements of a customer relationship. Designing a questionnaire is critical to the success of a global customer survey. l 2. Transactional Surveys Transaction surveys are administered immediately after a customer has had an experience with the organization’s product or service. The intent of the survey is to take feedback when experience is still fresh in the mind of the consumer. The feedback is typically sorted between 7 and 30 days after the event has occurred. The timely and specific feedback from customers can be a valuable enabler to process improvement. The methodologies used for transaction surveys are: 2a). Personal Interviews: These are face-to-face interactions between a company representative and the customer. 2b). Electronic Surveys: Commonly used these days, in this method the questionnaire is sent using the electronic mail or the internet. 2c). Mail Surveys: In this method the questionnaire is sent by mail or fax. But the problem here is that customers seldom respond. 2d). Telephone Interview: Extremely popular, in this method the feedback is taken over telephone and takes about 10–15 minutes. In telephone interviews the questions should be short and have relatively simple scales. The biggest advantage here is the speed with which the data can be gathered and is quite cost effective. 76
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l 3. New, Declining and Lost Customer Survey These surveys are used to determine why customers select the firm, reduce their buying or leave the firm. The objective is to assess the role service quality and other issues that come into play in customer patronage and loyalty. l 4. Focus Group Interviews This method involves direct questioning of a small group (usually eight to twelve people). Questions focus on specific topics and can be used with customers, non-customers, or employee groups. l 5. Mystery Shopping In mystery shopping researchers become customers to experience and evaluate the quality of service delivered. l 6. Customer Advisory Panels This involves a group of customers who are recruited periodically to provide the firm with feedback and advise on service performance and other issues. This involves capturing service expectations and perceptions gathered in the field. l 7. Employee Field Reports This is a formal process for gathering, categorizing and distributing field employee intelligence about service issues.
The objective of mentioning the above is to bring out the point that for an effective voice of customer, one single method may not be effective. You may have to look at a mix of the above as each tool has some utility value which the other cannot provide. It has been seen that a single listening system may be inadequate as it DEBASHIS SARKAR
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gives a snapshot at a point in time from a particular angle. Greater insights are unfurled when a series of snapshots are taken from different lenses. Six Sigma Takeaway Always measure the customer’s feedback with respect to customer’s expectations.
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Lesson 25 It is important to focus on the Right Measure to ascertain the Efficacy of a Process
When you talk about measurements of a process, ascertain what is being measured in the process. This is important for the impact to be felt by the customer. It may be foolish to expect an efficiency measure to impact the customer. What is required is to focus on the right measure in an improvement project for the impact to be felt. In any process, measures could be any of the following: 1. Process—Efficiency. 2. Output—Effectiveness. 3. Outcome—Customer Satisfaction. This is also delineated by the following model:
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But what are each of these measures: l
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Efficiency Measures: The measures of efficiency quantify the resources consumed in the process relative to minimum possible levels. They are measured within the process. Efficiencies are not measured by examining the products after they are produced or by surveying customers. Process measures represent parameters that directly control the integration of materials, methods, machines and the environment within the process. While frequently understood and used in functioning operations, process measures are often absent from service functions. It should be the endeavour of improvement teams in service companies to put process parameters in place. Some examples of efficiency measures are costs, variability, cycle time and so on. Effectiveness Measures: The measures of process effectiveness quantify the ability of a process to deliver a product or service according to their specifications. These measures represent specific features, values and attributes of each product or service that are expected by a customer. Like efficiency measures which are quantified relative to minimum theoretical levels, effectiveness measures too are a relative term. Measures of process effectiveness are calculated through a comparison of the process’s ability to deliver products and services (outputs) relative to customer requirements. They compare the output characteristics actually delivered by the process to the corresponding characteristics specified by the customer. LESSONS IN SIX SIGMA
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Outcome Measures: The measures of outcomes quantify the ability of outputs to satisfy the needs of their customers and represent the ultimate performance measure. Outcomes are beyond the direct control of the supplier and rely on the customer’s expectations and actions.
Outcomes can be measured in two ways: 1. Product/Service effectiveness. Product/service effectiveness measure determines how well the product or service (output) performs in the customer’s process. 2. Customer Satisfaction. 3. Customer satisfaction determines how well each product and service satisfies the needs and expectations of the customer and recognizes that satisfaction is based on vague, idiosyncratic perceptions. Remember, measures of outcome level can be determined only after the product has been delivered or the service has been provided. For an impact to be felt by the customer, do not forget to focus on the outcome measures. Six Sigma Takeaway By just targeting on efficiency measures, the customer may not feel the impact. Focus both on effectiveness and efficiency measures.
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Lesson 26 Together with Sigma levels keep an eye on the class of the process
I have often seen that people are satisfied once improvements have been carried using Six Sigma. Their rational is that the Sigma levels have improved so things are all hunky-dory. While there is nothing wrong in this philosophy, it may be worthwhile to evaluate your process with respect to the class in the Process-Grid given on the following page. Theoretically the goal of all processes should be to become Class 1. The Class of Process is identified by the following traits and characteristics:
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Process Type
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Class 6 Class 5 Class 4 Class 3 Class 2 Class 1
Ill-defined Defined Refined Capable Efficient and Effective Mature
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Process Grid
The decision whether to make a process Class 1 or Class 2 or Class 3 is a business call and is dependant on customer requirements. Remember, in certain processes; even a Class 3 process is fine while in others it is imperative that the process in Class1. There are huge costs associated in taking processes from Class 3 to Class 1. And this extra cost is to a need of the customer and he or she is willing to pay for it. Moving from Class 1 to Class 6 is not an easy task. The diagram gives an approximate time frame for a process to reach from Class 6 to Class 1. The duration may change based on the complexity and current state of the process.
Time Estimates for Class based Improvements
The time frames mentioned are pretty ambitious and we should not try to shorten it by taking short cuts. As 84
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improvements happen it is important to give sufficient time to allow the improvements to ingrain within the process. Six Sigma Takeaway Ascertaining the class of process shall give insights into the Sigma levels that should be achieved.
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Lesson 27 While executing DMAIC projects do not take short cuts. Follow all the steps
Six Sigma project essentially comprises five steps which have been scripted below: o
Step 1—Define: This is the first step of Six Sigma methodology and sets the foundation for carrying out an improvement project. It aims to clearly define the project with the champion while scripting clear goals and specifying the process with its customers and suppliers. The deliverables of this step are: l
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Project charter (comprising problem statement, goal statement, business case, primary quality characteristics also called CTQ, project milestones, what is in its scope, what is out of its scope, definition of a defect). Project boundaries. High level process map. LESSONS IN SIX SIGMA
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Step 2—Measure: The second step of a DMAIC methodology aims to gather data for establishing the current state. The objective of this step is to find out the extent of the problem and collect data to ascertain the few vital root causes. The deliverables of this step are: l
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Key process customers and suppliers. Project plan. Formation of a project’s team. Type of resources that will be required.
Identifying the Xs which affect the Y. (This is from the relationship Y= f (x), where Y is the outcome of a process and Xs are the causes of the predictors of the process). Detailed process map. Cause and effect diagram and a cause and effect matrix. Data collection plan. Sampling strategy and sample size. Measurement system including gauge repeatability and reproducibility study. Carrying out data collection to ensure there is sufficient data for analysis. Baselining the current performance levels or Sigma levels. Ascertaining yields.
Step 3—Analyze: This step endeavours to unfurl the potential sources of variation and reduce the number of process variables to be acted on in the DEBASHIS SARKAR
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improvement phase. Some of the key deliverables of this step are: l l
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Step 4—Improve: In this phase the root causes of the problem should be removed and the solution in the process need to be standardized. The proposed solutions are confirmed in this stage and the implementation strategy is worked out. To ensure that the solutions are effective, they are tried out in a prototype before commencing on a full-fledged improvement. Some of the key deliverables of this step are: l l l l l l l
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Process capability. Statistical analysis of the significance of X variables with respect to Y, leverage tools as analysis of variance (ANOVA), regression analysis, DOE. Detailed process map. Statistically validated root causes of the problem. Prioritized areas for improvement.
Potential solutions. New process map. Piloting solutions. Incorporating the learnings of the pilot in the solution. Identification of resources that are needed for implementation. Revised tolerances of the modified process. New capability analysis.
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Step 5—Control: This step establishes the standard measures of performance to ensure that improvements remain sustained. Process control tools are used to ascertain ‘out of control’ states so that they can be quickly detected and corrective actions put in place. Some of the deliverables of this stage are: l l l l l
Process control plan. Mistake – proofing measures. Control charts to monitor the process. Formal documentation of the new method. Data collection plan for ongoing process.
It is important to ensure that no steps in a DMAIC project are missed out. Also, regular reviews (Timeline Reviews) should be done after every stage to ensure the project progress is as per timelines. It is recommended that a checklist is made which lists all the steps to ensure that nothing is missed out and to help during reviews. Six Sigma Takeaway Six Sigma provides an excellent project management framework for improvement work.
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Lesson 28 It is imperative that all Six Sigma projects provide Real Time Savings
It is imperative that all Six Sigma projects should produce real savings. When a project charter is being scripted, calculate the anticipated savings for the projects. Unlike other quality methodologies, Six Sigma provides a platform for calculating the pay back from the improvements carried out. This is what differentiates the Six Sigma framework from other quality methods which talked tall but often could not deliver real time savings and benefits which the senior management of an organization would like to see. A Six Sigma deployment strategy should be delineated in such a way that it can pay for itself from the second year of implementation. This is not difficult as all Six Sigma projects are linked to business objectives so there is a high interest level; this drives the organization to complete the project effectively and on time. Let’s look at what happened to GE when it set out to implement Six Sigma. As reported in GE’s 1999 90
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Annual Report, it claimed a net benefit of more than $ 2 billion. At Honeywell, since Six Sigma was launched in 1991 it had documented $ 2 billion savings from Six Sigma implementation as reported in September 2001. (Honeywell developed a new generation proprietary system called Six Sigma Plus. This powerful quality strategy was developed through the 1999 merger of the two technology giants, Allied Signal and Honeywell, both long time leaders in applying modern methodologies for meeting customer needs.) When setting out on the deployment of Six Sigma projects create a right portfolio of projects yielding short-term and long-term payback. The recommendation here is to include more number of projects which result in short-term paybacks (These include projects on process efficiency, lowering operating costs, increasing yields etc.). This is required for the following reasons: (a) to pay for the projects, (b) to ensure people perceive the benefits, taste success and gain confidence to take up projects again, and (c) to help in quicker Six Sigma institutionalization as it shall create advocates of Six Sigma who have seen it delivering real savings. Long term payback projects could also be taken up but the number should be few in the initial years. These would include projects on customer satisfaction, employee motivation and so on. Six Sigma projects could lead to either hard savings or soft savings. Hard savings are those which directly impact the bottom-line. They typically result in cost reduction or revenue enhancement. Also called bottomline savings, hard savings can be deciphered by carrying out a financial analysis of year-to-year spending and DEBASHIS SARKAR
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looking for ways to reduce spending. Revenue enhancement can be seen in projects which result in increase of sales volumes. On the other hand, soft savings are difficult to quantify and include projects such as cash flow improvement through reduction in inventories, customer satisfaction through on time delivery and so on. Whether it is hard savings or soft savings, make it mandatory to quantify anticipated savings during the project charter phase. Also, once the project gets over, the Chief Financial Officer’s (CFO) office should vet all savings. This is to ensure that savings do not remain a mirage to the top management but they can see it for themselves. And who can validate this better than the CFO’s office. Six Sigma Takeaway All savings from Six Sigma projects should be validated by the CFO’s office.
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Lesson 29 Just by calculating the potential benefits in the beginning and accrual benefits at the end of a project, will not get the wow from either the CFD or his team members.
It has been seen that quite a few organizations implementing Six Sigma in India do not get their due credit from the Chief Financial Officer’s (CFO) office, despite doing a successful project and having quantified the benefits. The response of the CFO or his or her office is often discounted and the effort is treated as another of those improvement projects. Sometimes they are appreciative of the efforts but the accolade of ‘wow’ is missing. What actually happens is that the project team members are so busy with their tools and techniques that they forget about the financials during the project execution except for the ritual of mentioning about the savings during the charter phase and after the project is over. Remember, Six Sigma is about driving value so just carrying out the ritual of benefits calculation at the DEBASHIS SARKAR
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beginning and end of project will not work. What can be done differently so that the projects get the attention of your colleagues in the finance function? Here are a few steps which can be followed to elicit desired responses. l
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Six Sigma projects should be jointly owned by the champion, the team leader (Black Belt) and the CFO’s office. Six Sigma team must have a representative from the finance function. Benefits calculation done before the commencement of the project should be validated by the CFO’s office. Include a member from the CFO’s team as the project team (involve him or her from the early phase itself). Clearly script the role of the member from the finance function, which is to help the team to unfold and translate rupee savings at each step. Align with the finance organization to find out what is included under soft savings and what is included as hard savings. Ensure that all guidelines on benefits calculation, as laid down by the CFO’s office, is adhered to. Try to involve the CFO or his or her representative during the toll gate reviews, the champion should also get involved here. Create highly visible dashboards to communicate to the team members and the organization that the project is delivering savings. LESSONS IN SIX SIGMA
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Recognize the members from finance organizations who have helped in the project completion. Before making claims on benefits ensure that the calculations are validated by the process owner, master black belt and the CFO’s office.
So, when you do all the above during the process of the project execution, you will not only receive appreciation from the CFO but also the claims will be auditable by anyone in the world. Six Sigma Takeaway Keep the finance function in the loop during the entire life cycle of the project.
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Lesson 30 Six Sigma methodology is just not for manufacturing organizations. It can be deployed in service organizations as well
Some people think that Six Sigma is only for the manufacturing industry. They feel that since the tools have been used in a manufacturing industry, it cannot be applied in a service industry. It is important to remember that irrespective of whether it is a manufacturing organization or a service business, they are a collection of processes. So Six Sigma can be applied without any hurdles. Some consultants have worked out Six Sigma Black Belt/Green Belt training programmes targeted at the service organizations. These programmes deal with cases from the service space and attempt to address problems experienced there. However, the application of Six Sigma in service operations is quite challenging. It requires much greater effort and focus for successful Six Sigma deployment. The following are the reasons which make implementation a challenge in the service space: l
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Unlike in manufacturing industries where you can see the process in front of your eyes, in the service industry the processes are hidden. Say for example: You can see the process of soap manufacture before you, but it may be difficult to see the account opening process in a bank. l Performance Measurements not there Often process parameters are not measured in a service sector, so one may not be aware of how processes are performing. The data which is present is often narrow, subjective and cannot be taken for improvement work. l Focus on quality is often less Quality as an agenda has been an integral part of all manufacturing companies but its only over the last five to seven years that service companies have really started to look at quality as an integral part of their businesses. The emphasis on quality has always been there in manufacturing organizations but it is a new thing in service companies. One can imagine that trying to implement Six Sigma in service organizations, which have never talked about quality, may be a tall order. l Involvement of People As the involvement of people is high in the service industry, the chances of errors and problems are more. This is because processes are highly dependant on people and hence the chances of errors and quality issues go up. Also, people in the service industry are often not exposed to technical tools and measurements, which make them quite unprepared for sophisticated tools that DEBASHIS SARKAR
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may be required in Six Sigma. Of course, this can be eliminated through training. What is required in service companies before they set out on a Six Sigma implementation is to define the processes well. It would help if these organizations have a business process management framework. This could be achieved either through an ISO 9001:2000 standards implementation or through Business Process Management System (BPMS) which is nothing but laying down end-to-end processes around customers with measurement systems and process owner. While a BPMS system is being laid down, the non-value added steps should be removed. Do not focus too much on complex statistical tools in service companies. The approach should be to use tools which lead to improvement and not get lost in statistics. Once service organizations decide to implement Six Sigma, the endeavour should be to take the entire team with a clear vision, focus on measurement system and remove ambiguities through measurable performance indicators. Remember, it is imperative to focus on the fundamentals such as process mapping and process ownership, before implementing Six Sigma. Six Sigma Takeaway Service companies should clearly define their processes before implementing Six Sigma.
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Lesson 31 Be on top of meetings. Let them be enablers to project improvements
Meetings are an integral part of Six Sigma projects. So it is essential that meetings should be effective and deliver value. Millions of rupees are wasted due to ineffectively managed meetings caused by poor planning, too many or too less participation, poor communication techniques etc. Meetings which seem to go on forever and accomplish little or nothing leaves us feeling extremely frustrated. So what makes meetings effective? Here are a few guidelines which will make the meetings effective and accomplish their intended goal. l
Avoid a meeting if the same information could be covered in a memo, e-mail or brief report. Check out if the meeting is really required and whether it is the best way to handle the situation.
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Define the purpose of the meeting and set objectives before hand. The benefits of setting objectives for the meeting are two fold: (1) It helps to plan the meeting and the more concrete your meeting objectives, the more focused the agenda will be. (2) Having specific objectives for each meeting means that there is a concrete measure against which you can evaluate that meeting. Develop an agenda in co-operation with key participants. Before the meeting starts, provide all participants with the agenda which should include a description of the meeting objectives, a list of the topics to be covered and a list stating who will address each topic and for how long. While sending the agenda you should include the time, date and location of the meeting and any background information which participants need to know to hold an informed discussion on the meeting topic. Assign a time to prepare for the meeting. Give participants time to prepare for the meeting. A meeting without preparation may lead you nowhere. Set a time for the meeting to begin and a time for it to end, and then be certain to adhere to these times. This will allow the participants to plan the rest of the workday. If possible, arrange the room so that members face each other, i.e., in a circle or a semi-circle. For large groups, try u-shaped rows. Choose a location that is suitable to your group’s size. LESSONS IN SIX SIGMA
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Small rooms with too many people get stuffy and create tension. A larger room is more comfortable and encourages individual expression. Encourage group discussions to get all points of view and ideas. Keep the conversation focused on the topic. Feel free to ask for only constructive and non-repetitive comments. Tactfully end discussions when they are getting nowhere or becoming destructive or unproductive. Zero in on the actions. Don’t finish any discussion in the meeting without deciding how to act on it. Listen for key comments that flag potential action items and don’t let them pass by without addressing them during your meeting. Summarize agreements reached and end the meeting on a unifying or positive note. Evaluate the meeting. Assign the last few minutes to allow every person to answer the following questions: What worked well in this meeting? What can we do to improve our next meeting?
If the above guidelines are followed, the meetings will be much more effective and you will see the results for yourself. As a Six Sigma project leader you have to master the art of conducting meetings. My recommendation to organizations is that all Black Belts and Green Belts should be trained to run meetings and DEBASHIS SARKAR
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put in place a mechanism to constantly monitor their effectiveness. Six Sigma Takeaway Effectiveness of meetings can be judged by the number of actions being generated and number of actions getting closed.
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Lesson 32 Before setting out to do a Six Sigma project ensure that it is scoped well
Before setting out to do a Six Sigma project it is imperative that it should be scoped well. When a project is scoped, essentially it is the process boundaries that are being laid. It means we define the project limits within which the process being taken up for improvement will be looked at. The importance of an effective project scope is that it allows problems to be looked at with laser type focus. The precise scoping of projects allows the team members to stay within limits. A Six Sigma project should ideally take three to four months. No projects should go beyond six months. Any project that is overrun beyond six months can result in team de-motivation due to lack of progress and could even result in team break-up. This could lead to further delay. A delayed project will also lead to increase in project deployment costs. An important criteria of Six Sigma projects is that it should provide benefits in terms of cost, quality and timing. So, do not take up a project which cannot be completed within three to four months. DEBASHIS SARKAR
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Never take up projects that aim at ‘poverty alleviation’ or ‘removal of world hunger’. Often, champions may push people to take up projects which are ambitious and are of a large scope. This especially happens when champions are not aware of Six Sigma and what is a right scope. Also, champions may think of putting unrealistic expectations with the thought of stretching goals. Remember, this should never be allowed. When a team takes up projects with unrealistic expectations, it is a clear recipe for frustration of team members. It should be mentioned here that projects which are top-down are often tied to the business strategy but are quite broad in scope. This is where the internal Six Sigma experts (read: Black Belts) have to break it up into manageable projects. However, projects which are bottom-up may not have this problem as they are typically scoped by internal Six Sigma experts. My recommendation is that the champion and the Black Belts should sit together and scope out the projects together. When this is done the alignment of the champion automatically happens. Sometimes data may be required before deciding the scope of a project. If so we should complete the required data collection before arriving at a project scope. A project scope should have a narrow scope with specific boundaries that enable completion within stated timeframes. When commencing a Six Sigma journey I would recommend that projects which are relatively less complicated should be taken up. This is important because the success of a Six Sigma project is extremely critical. This is because unsuccessful projects could lead 104
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to de-motivation and there may be reluctance to take up successful projects. Remember, success breeds success. The first project should be aimed at gaining confidence. So, even if the scope is small, do not worry. When a number of small manageable projects are taken up for improvement, it will lay the seeds of quality work all across the organization. This is much better than taking up a few large projects. A number of small projects lead to Six Sigma reaching deep and wide within the organization and is an ideal method to embed the seeds of improvement within the organizational fabric. Six Sigma Takeaway A project which cannot be completed within reasonable time-frames should never be taken up for improvement.
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Lesson 33 The organization should have an effective methodology to ensure that there is a continuous flow of ideas
The other day I was talking to the Improvement Head of a leading financial services organization. His concern was that having started the Six Sigma journey, how would he look at ensuring constant flow of ideas which can be taken up for improvement. This is quite a familiar struggle in organizations which start their journey towards Six Sigma implementation. Having started with a few Six Sigma projects they are not aware as to how they can have a bank of improvement opportunities which gets constantly replenished. In light of the above, it is necessary that before the projects get underway, multiple sources of project ideas should be identified. The generation of improvement opportunities is never a problem even in an organization which has made huge strides in quality improvement. What is required is to identify the multiple sources of potential project ideas. 106
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The following is a list of project sources which an organization should look for: l
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Voice of the Customer: Constantly look for potential ideas from customers. An organization can get to hear the customer’s voice from surveys, focus group activities, face-to-face interviews, competitive shoppers, toll free telephone numbers and auditors. Project Selection Workshop: A structured method for project ideas is to hold a project selection workshop. In such workshops, potential project ideas are drilled from business objectives. Typically champions are involved in a project selection workshop. An organization should carry out a project selection exercise at the beginning of each year to ensure there are sufficient ideas for improvement. Customer Complaints: Complaints are an excellent source of potential project ideas. Look for trends/patterns in complaints and the vital few which result in customer issues. Ideation: Ideas could be brainstormed involving process owners and people at the workplace who are directly or indirectly associated with or affected by the process. Look at mission critical processes: Bring the mission critical processes under the microscope. Every organization has a few mission critical processes which drive the achievement of strategic objectives. When looked at in a greater detail, you DEBASHIS SARKAR
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l
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l
will discover that there are clear opportunities for improvements. Cost of Quality Reports: Cost of poor quality (COPQ) reports serve as an excellent source for improvement opportunities. It may make sense to put in place a COPQ measurement for every business unit, function, department or workplace. The concept of quality costs have been discussed in detail in another lesson. Suggestion Scheme: This is a bottom up approach to get ideas for improvement. This methodology allows the involvement of all employees in an improvement effort. What would be required is a fairly robust mechanism to support it, as it would require all suggestions for improvement to be responded. Providers of ideas which are accepted for implementation should be rewarded suitably. In case there is an inhouse intranet, you could seek improvement ideas through it as well. Costs: Find out all the high cost processes. These may be a good candidate for a Six Sigma project. You may have to use the Activity Based Costing Method for this purpose.
Remember, before setting out on a Six Sigma journey, identify the possible sources of improvement opportunities. You could start with a few sources and then increase the list. But avoid landing in a situation where you complete with your first phase of projects and do not have further ideas for improvement. 108
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Six Sigma Takeaway Create a solid infrastructure for continual in-flow of project ideas.
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Lesson 34 All improvement ideas need not qualify as candidates for Six Sigma project
Once multiple sources of project ideas have been set up, an organization probably gets inundated with ideas. Managing these ideas is critical as all of them may not qualify for a DMAIC project. What is required is to set up a clearly laid down criteria for anyone to know what qualifies for a DMAIC project and what does not. I have worked out a ‘DMAIC Ideas Matrix’ which has been used extensively to ascertain whether an idea is eligible for a DMAIC project.
DMAIC Ideas Matrix Each idea should be run through the following list to ascertain if it has a potential for a DMAIC project: S.No.
Criteria
1.
There is a gap between the current and desired/needed performance.
Yes/No
(contd.) 110
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S.No. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13.
Criteria
Yes/No
The cause of the problem is not clearly understood. The solution to the problem is not predetermined, nor is the optimal solution apparent. The process is not well defined. The process is not in transition. The idea does not look at controversial issues which could lead to the ideas dying off because of inter-departmental turf wars. A similar problem has not been taken up for improvement in any other parts of the business. The implementation of the idea does not merely lead to incremental improvement but looks beyond it. The Idea makes a likely business case and weaves into the larger strategic objectives. There is an urgency in the addressing of the problem. The problem is getting bigger and bigger over time. There is no other easier method to tackle the problem. There would be a likely buy-in for this project.
All the criteria should be positive for an idea to qualify for a DMAIC project. Six Sigma Takeaway Ideas for Six Sigma project should centre primarily around customer or business issues.
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Lesson 35 Creating the right organizational structure is essential for Six Sigma deployment
Quite a few people often ask me what should be the organizational structure in a company commencing on a Six Sigma deployment. While there could be quite a few structures, the one mentioned below has found to be quite effective. The Head of Quality, Head of Corporate Quality, Head of Improvement or Head of Excellence has the overall responsibility for getting the customers’ voice into the organization. He or she is actually the customers’ representative in the organization and ensures that the company does all that is required for taking the company to the trajectory of excellence. This position directly reports to the CEO of the company and should have equal authority as other direct reports. This position is also a member of the Quality Council. The Master Black Belts (MBBs), Black Belts (BBs) and Green Belts (GBs), all report to the Head of Quality. The MBBs, BBs, GBs are typically deputed to various 112
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business units and function for Six Sigma deployment and project execution.
l
l
l
Quality Council comprises senior management team and is chaired by the CEO. Master Black Belts Report to Head Quality and have a dotted line reporting to the Business Heads and Functional Heads. Black Belts and Green Belts report to Master Black Belt and Black Belts respectively. DEBASHIS SARKAR
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In a few organizations, the Head of Quality does not report to the Chief Executive Officer but to some other line head or business head. This is not really the right thing to do. Remember, the Head of Quality is responsible for the following major roles to play: l l l l l l
Represent the needs of the customers. Be responsible for overall quality deployment (includes Six Sigma) in the company. Play a leading role to take the company towards an improvement trajectory. Be responsible for the setting up of the Quality Management System within the company. Ensure that improvement tools such as Six Sigma are deployed correctly. Periodically report to the CEO about the health of ‘quality’ in the company.
Six Sigma Takeaway In order to maintain impartiality, the Head of Quality should report to the CEO of the company.
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Lesson 36 Before determining the sample size and sampling plan, ascertain if the data for measurement is from a moving process or is it from a stagnant population
I have often seen that people working on Six Sigma projects do not follow the right sampling strategy and the right sample size. Either the sampling plan and size is both incorrect or the sampling plan is correct but the sample size is wrong. I understand that the determination of a proper sample size is often complicated and may require prior statistical knowledge. But an organization should not take sample sizes at whims and fancies, but must follow the right sample size to ensure desired results. There are Six Sigma trainers who preach random selection of 30–50 samples without bothering about the type of data that is being handled. This is absolutely incorrect. It is important to note that the sample size and sampling strategy will be dependant on the status of DEBASHIS SARKAR
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the process. Practitioners often miss this, which leads to wrong results. Sampling from a still population is different from sampling from a moving process. The former is called population sampling while the latter is called process sampling. Population sampling essentially means taking samples from a standing puddle of water while process sampling means taking the sample of water from a moving river. To give you some more examples from workplace, taking samples from a set of 10000 account opening forms in a bank is population sampling. On the other hand, ascertaining the performance of a customer service associate in a call centre with every 100th customer, is process sampling. In real life there will be a number of instances when you come across a process which is moving and changing minute by minute. So using population sampling may be incorrect. Unlike a stagnant population, in moving processes the challenge is to sample in such a way that it is representative of the whole moving process. Depending on whether the data is from a population or from a process, one should apply population or process statistics and arrive at the sample size and sampling strategy. Six Sigma Takeaway Process sampling is always more challenging than population sampling.
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Lesson 37 Understand the key terms and the steps involved in DPMO calculation
Defect: This refers to anything that does not meet the requirements of a customer, laid down product or process standards. You could also say that anything which does not match the laid down performance standards or results in a non-conformance is a defect. Opportunity: A chance or an event that a product or service may not meet the laid down performance standard or customer requirement. Unit: This refers to the object on which a measurement or observation is made. It also refers to an item being processed or a product (includes service) being delivered to a customer (includes both internal and external customers). Remember, it is always used in the sense of the entity of an inspected product in order to determine if it is defective or non-defective. A unit could be a scooter, a van, a home loan, an account opening form in a bank, an airline travel, a bank statement and so on. DEBASHIS SARKAR
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Defect Per Million Opportunities: This refers to the expected number of defects found per million opportunities. To calculate DPMO, these steps could be followed: l
Which processes are you working on?
l
What is the principal output of the process also called ‘unit’ or the object on which a measurement is being made (U)? What are the defects that you will be looking at in a single ‘unit’? What is the number of defects that you find on one single unit (These are the ‘opportunities’ ? (OP) At the end of the process, what are the total number of defects? (D) What is the Total number of Opportunities (TOP = U ´ OP)? What are the Defects per Unit or DPU (D/U) ?
l l
l l l l l
What are the Defects per Total Opportunities (DPO = D/TOP) What are the Defects per Million Opportunities (DPMO = DPO ´ 1000000)?
Let’s look at the following examples: Example 1: Let us look at an account opening form at a bank. l
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Which process are you working on?: Process of filling an account opening form. LESSONS IN SIX SIGMA
l
l
l
l l l l l l l
What is the principal output of the process also called ‘unit’ or the object on which a measurement is being made? Correctly filled account opening form. What are the defects you will be looking at in a single ‘unit’? (a) Incorrect Address, (b) Incorrect Name, (c) Availability of PAN or Permanent Account Number for tax purposes. What are the number of defects that you can find on one single unit (These are the ‘opportunities’ (OP)? 3. At the end of the process, how many units were counted (U)? 250 (Account opening forms). At the end of the process, what are the total number of defects? (D)? 50. What is the Total number of Opportunities (TOP = U ´ OP)? 750. What are the Defects per Unit or DPU (D/U)? .20. What are the Defects per Total Opportunities (DPO = D/TOP)? .066667. What are the Defects per Million Opportunities (DPMO = DPO ´ 1000000)? 66666.67. What is the Sigma level corresponding to the above DPMO levels (Use the DPMO – Sigma Conversion Table mentioned at the end of this Lesson)? 3 Sigma approx.
Example 2: DPMO can also be calculated in the following manner mentioned below: Here we shall look at a few defects which were found in 100 ml hair oil bottles of a brand ABC: DEBASHIS SARKAR
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Characteristics
D
U
OP
TOP = U/OP
DPU = D/U
DPO = D/TOP
DPMO = DPO ´ 1000000
Overfill volume Label lifting Oil smear on bottles
20 15
2000 1971
2 3
4000 5913
0.01 0.00761
0.005 0.002537
5000 2536.783
55
21000
3
63000
0.002619
0.000873
873.0159
Total
90
72913
0.001234
1234.348
Use the DPMO–Sigma conversion table to get the corresponding Sigma levels. In this case the Sigma level corresponding to 1234.348 DPMO is 4.5. DPMO – Sigma Conversion Table Yield (%)
DPMO
Sigma
6.68 10.56 15.87 22.66 30.85 40.13 50 59.87 69.15 77.34 84.13 89.44 93.32 95.99 97.73 98.78 99.38 99.70 99.87 99.94 99.977 99.987 99.997 99.99833 99.99966
933200 894400 841300 773400 691500 598700 500000 401300 308500 226600 158700 105600 66800 40100 22700 12200 6200 3000 1300 600 230 130 30 16.70 3.4
0 .25 .50 .75 1 1.25 1.5 1.75 2 2.25 2.5 2.75 3 3.25 3.50 3.75 4 4.25 4.5 4.75 5 5.25 5.50 5.75 6.0
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Six Sigma Takeaway Everyone associated with the process that is being looked through the lens of Six Sigma should be familiar with the calculation of Sigma levels.
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Lesson 38 DPMO is a good concept but be alert about the confusions it can create. Mindlessly increasing the Opportunity Levels can increase the Sigma Levels
We have earlier seen the concept of DPMO or the ‘defect per million opportunities’, which is the expected number of defects found per million opportunities. The formula for DPMO is: DPMO = DPU ´ 1,000,000/Average opportunity for error in one unit. A DPMO gives additional insight into a process by including the element of opportunities for failure. Traditionally we looked at the rate of defects after the end of a process. So, if 100 units were produced and 5 units failed, we reported the defect rate as 5 per cent. However, in DPMO we include all the chances of a product failing to meet the performance. We have seen the calculation in detail so it will not be delved on in this section. DEBASHIS SARKAR
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The beauty of DPMO is that it gives a common language to compare processes of various complexities. It is a metric that allows for the uniform measurement of processes. But the DPMO usage should be done with caution, especially with respect to the number of opportunities that are decided upon for calculation. In light of the above, the following is suggested to avoid confusion: l Consider only those defects which make sense. Mindlessly increasing the defects would reduce the DPMO while increasing the Sigma levels. This may be misleading as the process may not be performing well but the Sigma levels may be high. The best thing to do here is look at only that defect/ defects that are linked to the CTQ characteristics. To illustrate this let us look at an example of an account opening form. The opportunities could be name, address, income levels, type of account, correct nomination, PAN number and introducer’s name. One approach could be to consider all the ‘defect’ opportunities. This may not be the right thing to do as many of the items mentioned are not going to affect the customers. Instead of focusing on all seven items, just focus on three items as defect opportunities i.e. name, address and PAN number. The more the number of opportunities, the DPMO figures would go down while increasing the Sigma level. This may haze the reality. l The definition of defects should be standardized all across the company so that irrespective of the location or business group, the understanding is the same.
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l Wherever possible, cluster the related defects into a single opportunity. Let’s understand this by an example. While talking about guest relations in a hotel, the following is a list of opportunities when a defect could happen (only a partial list is considered here):
Behaviour of the front office person. Check in time. Cleanliness of the toilets. Cleanliness of bed-sheets/linen. Time taken for room service. Cleanliness of cutleries. Time taken for getting toiletries. Functioning of air conditioner. Room lighting. Billing error. Instead of taking all opportunities, cluster the above into four opportunities such as: 1. Front office (Behaviour of front office person, check in time, billing error). 2. Housekeeping (Cleanliness of toilet, cleanliness of bed-sheet/linen, time taken to get toiletries). 3. Room service (Time taken for room service, cleanliness of cutleries). 4. Maintenance (Functioning of air conditioner, room lighting). It is always practical and convenient to have a shorter list of opportunities. Had all the opportunities for defects been considered, the DPMO would have been DEBASHIS SARKAR
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reduced—thus increasing the Sigma levels. Always use your team’s judgment to come up with a list of defects. Remember, there is no right or wrong answer to it. Six Sigma Takeaway Before making inferences on Six Sigma levels calculated through DPMO, have a look at the number of opportunities.
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Lesson 39 Do not be satisfied merely with Yields, commence with the calculation of a First Pass Yield
Traditionally organizations have calculated yields at the end of the process by looking at the superior products produced. These products also include items which may have got reworked during processing. For example:
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Out of the 100 units which entered the process, there were 20 units which were defective after the first step of operation. In the second step, out of 80 units that get in as inputs, 15 are defective. However, after Step 1, out of the 20 defectives produced, 10 are reworked. Similarly after step two, out of the 15 defectives, 5 are reworked. Traditionally, Yield (also called Final Yield) has been calculated by looking at the outputs produced at the end of the process and includes the defective items which have been reworked. So, following the above methodology Yield = 80/ 100 ´ 100 = 80 per cent. There is another yield which every professional should calculate, this is known as the First Pass Yield. This indicates the number of units made without including the defectives that have been reworked. This gives a true picture of the process. It gives the true picture of your internal processes. Hence, First Pass Yield = 65/100 ´ 100 = 65 per cent. It is imperative that while calculating the yield, you also find out the First Pass Yield. This helps you to unfold the hidden factors or the non value added activities happening in your process. Six Sigma Takeaway When an yield of a process is reported, ascertain if it is the Final Yield or First Pass Yield.
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Lesson 40 You can unfurl the non-value added activities in your process from DPU levels by a measurement called the Rolled Throughput Yield
We have already seen the concept of First Pass Yield in Lesson 40. Another methodology to determine the nonvalue added operations in a process is to look at the Rolled Throughput Yields (RTY). The RTY measure-
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ment unfolds the hidden factors in a process. It is an estimate of the percentage of units that pass through a process without any defects. You can find the Rolled Throughput Yield of the process by the following method: RTY = (Yield after Process Step 1) ´ (Yield after Process Step 2) RTY = (80/100) ´ (65/80) = .6581 = 65.81%. We can also calculate RTY from the DPU levels but we will have to look at a bit of elementary statistics. What is yield? It is a probability density curve between the tolerances. We will use the method of Poisson Distribution here. A Poisson process is said to exist if we can observe discrete events in an area of opportunity—a continuous interval (length, time, area etc), in such a manner that if we shorten the area of opportunity or interval sufficiently, 1. The probability of observing exactly one success in the interval is stable. 2. The probability of observing more than one success in the interval is zero. 3. The occurrences of a success in any one interval is statistically independent of that in any other interval. Thus probability with zero failures (from Poisson Distribution) = 130
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= Y = P(x = 0) =
e -l lx x!
= e–l = e–D/U = e–DPU (Where l is the mean of the distribution, x is the number of failures and e is a mathematical constant approximated by 2.71828, D is the number of defects, U is the number of units and DPU is Defects per unit). So, the Rolled Throughput Yield (RTY) = YRT = e–D/U = e–DPU Example:
To take an example, lets look at the above process which had two steps. The RTY can be calculated with the help of the following table: Operation
Defects (D)
Units (U)
DPU (= D/U)
Throughput Yield (=)
1 2
20 15
100 80
.2 .1875
.818 .829
Total
35
180
.3875
.678
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Thus, the Rolled Throughput Yield of the process = 67.80 per cent. To summarize, Rolled Throughput Yield ensures the probability of passing a unit of product or service through the entire process in a defect-free manner. Six Sigma Takeaway Rolled Throughput Yield is the best yield metrics to drive improvement and is the percentage of units that passes through an operation without any defects.
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Lesson 41 Defects in a Six Sigma process without a shift is 2 Defects Per Billion and not 3.4 Defects Per Million opportunities
This is a topic which neophytes of Six Sigma often get confused with. It is based on the theory that with the lapse of time any process that is in control shifts from the target or mean by up to 1.5 sigma (1.5 s). This results in acceptance of the Six Sigma value as 3.4 defects per million. Without the 1.5 Sigma shift, Six Sigma results in 2 defects per billion opportunities. This is elucidated in detail below: Without a 1.5 sigma shift (1.5 s), the number of parts per million (ppm) that would be outside the specification limits (if the data were centered within the specification limits) having various standard deviations, are shown in the figure on the following page. With a non-central data and considering a shift of 1.5 s, the distribution with respect to the specifications is:
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Within +/– 1 Sigma, 68.27% of the data points are included and result in defective levels of 317300 ppm. Within +/– 2 Sigma, 95.45% of the data points get included and result in defective levels of 45500 ppm. Within +/– 3 Sigma, 99.73% 99.73% of the data get included and result in defective levels of 2700 ppm. Within +/– 4 Sigma, 99.9937% of the data get included and result in defective levels of 63 ppm. Within +/– 5 Sigma, 99.999943% of the data get included and result in defective levels of .57 ppm. Within +/– 6 Sigma, 99.9999998% of the data get included and result in defective levels of .002 ppm.
(The above data can be obtained from any normal distribution table in the appendix of a statistics book.) There are some practitioners of Six Sigma who do not believe in the concept of a shift. They say that a shift of 1.5 sigma results in the defect adulteration from 2 ppb to 3.4 ppm, which is a quality adulteration of 1700:1. They also say that it is relatively easy to correct this shift from the target value by a minor adjustment. 134
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Within +/– 1 Sigma, 30.23% of the data points are included and result in defective levels of 697700 ppm. Within +/– 2 Sigma, 69.13% of the data points get included and result in defective levels of 308700 ppm. Within +/– 3 Sigma, 93.32% 99.73% of the data get included and result in defective levels of 668100 ppm. Within +/– 4 Sigma, 99.3790% of the data get included and result in defective levels of 6210 ppm. Within +/– 5 Sigma, 99.97670 % of the data get included and result in defective levels of 233 ppm. Within +/– 6 Sigma, 99.999660% of the data get included and result in defective levels of 3.4 ppm.
My recommendation here is that do not get lost in this methodology war. Use the rigour of Six Sigma for improvement. Six Sigma Takeaway Do not get lost in the concept of 1.5 sigma shift, work towards improvement.
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Lesson 42 Get a sense of whether Six Sigma is delivering value through the measurement of Quality Costs
A key ingredient to Six Sigma deployment is cost-based discipline. A sound Six Sigma system contributes to customer satisfaction and organizational objectives, including financial stability. Significantly, quality costs are normally overlooked or remain unrecognized in many organizations because accounting systems are not designed to identify them. Before setting out on a Six Sigma journey it would make sense to put in place a system to evaluate the quality costs in the organization. Quality costs not only provide details on potential areas of improvement but also reflect whether Six Sigma is delivering the benefits once deployment is underway. So what is Quality Cost? Quality cost or cost of quality is defined as the cost of those activities which an organization or process possesses over and above the minimum cost that is required to do the job well. Any costs associated with correcting failure or waste go into quality costs, as do any assurance or approval 136
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activities built in to cushion customers form the effects of such failures. A further set of activities are those in which we attempt to prevent such failures from occurring at all, such as effectively designed market research and training. Essentially quality costs are defined as the total costs incurred by (a) investing in the prevention of nonconformance to requirements (b) appraisal of a product or service for conformance to requirement and (c) failure to meet requirements. Now what are each of these costs:
1. Prevention Costs All that we spend to prevent defective work from being made in the first place is grouped under prevention costs. This includes cost of quality management, setting up and operating quality control and quality assurance systems, provision of foolproof methods— so that work is bound to be made correctly, supplier quality assurance, vendor appraisal, calibration and maintenance of measuring, equipment etc.
2. Appraisal Costs These are the costs of inspection and test in its widest sense including checks done by people who are not titled inspectors, e.g. setter, supervisors etc. The appraisal cost could be divided into two groups such DEBASHIS SARKAR
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as (a) Cost of test and inspection to identify and eliminate defective work. For example the cost of 100 per cent inspection or sorting to find and eliminate defective work. (b) Cost of test and inspection to monitor processes, and keep them right.
3. Failure Costs This is the cost incurred due to design failure or the inability to make or provide the quality of product or service as it is demanded by the customer. Failure costs easily tend to be the largest of the three quality costs, and we can divide them into internal and external costs as given below:
F
Internal Failure Costs
These are the costs incurred within the manufacturing organization, up to the moment when the product is transferred to the customer. Typically they include the following: Scrap, Rework, Corrective Operations (this is the cost of correcting work which is wrong), Downgrading, Seconds and Associated Costs (loss of production capacity, cost of investigating the cause) etc.
F
External Failure Costs
These are costs incurred after the product has been handed over to the customer. For example: Cost of products or services rejected by the customer or recalled 138
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because of some defect; product liability; warranty costs; cost of placating irate customers; loss of future orders from that customer, etc. There is of course considerable room for discretion as to what should or should not be included in the prevention costs; to make any meaningful control possible therefore, it is essential for the quality manager and the accountant to agree precisely on what should not be included. My recommendation to all organizations treading on Six Sigma is to put in place a mechanism for quality cost measurement so that the management can get to know if Six Sigma is delivering value. As a matter of fact, quality costs should be an agenda item of all quality council meetings. Let us see the relationship between Sigma levels and cost of poor quality. Relations between Six Sigma and Cost of Poor Quality Sigma
Defects per million
Cost of Poor Quality
6 sigma 5 sigma 4 sigma 3 sigma 2 sigma 1 sigma
3.4 defects per million 230 defects per million 6.200 defects per million 67,000 defects per million 310,000 defects per million 700,000 defects per million
< 10% 10 to 15% of sales 15 to 20% of sales 20 to 30% of sales 30 to 40% of sales.
Six Sigma Takeaway Use Quality Costs to find out potential improvement projects. DEBASHIS SARKAR
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Lesson 43 When a process capability is reported, ascertain if it is a long-term or short-term capability
When someone reports to you about process capability, ascertain if it is long-term process capability or shortterm process capability. The other day a CEO of an organization told me about how his Quality Manager had been inflating the ‘capability’ of a process by reporting short-term capability. This was happening because the management did not know the difference between short-term and long-term capability. The curtain came down when the CEO went for a Six Sigma programme and got to know that long-term as well as short-term capability could define the capability of a process. Now this is not an isolated happening. I know of another incidence where a Six Sigma consultant was hired by a bank to carry out improvement using the Six Sigma methodology on a core business process. The consultant was aware of the ignorance of the management and showed huge improvement by reporting short-term Sigma instead of long-term Sigma. 140
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So, what is the difference between short-term and long-term capability? l
Short-term Capability
This essentially determines the inherent capability of a process that is whether the process is in a position to deliver when the input variables are held constant. The short-term capability determines the entitlement of a process. Entitlement is the best observed short-term performance of a process, given its design. Short-term capability takes into account only the common causes of variation. To determine short-term capability, the study should be designed carefully to achieve the shortest term data possible. Yes, it is a must that the data used for short-term capability should be over a short period of time. Further, the data needs to be gathered over a limited number of operators, machines, cycles and should always be continuous variable data. l
Long-term Capability
The long-term capability is the actual performance of a process. It takes into account both common and special causes of variations into account. Data for long-term capability are collected over a long period of time covering many cycles, intervals and operators because it is the variation in the inputs that causes the variation in output quality. The DEBASHIS SARKAR
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data used for calculating long-term capability can either be continuous or discrete. Data is considered long term if 80–85 per cent of the inputs are allowed to fluctuate over a period of time. The difference between the short-term capability and long-term capability is the opportunity for improvement for Six Sigma practitioner.
It is the endeavour of Six Sigma projects to reduce the gap between long-term performance and short-term entitlement. Make it a policy in your organization to ensure that both long-term and short-term capability of the processes are determined and reported. When this is done it can be explicit as to how the process is faring with respect to its entitlement. Six Sigma Takeaway Report both short-term as well as long-term capability for your processes.
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Lesson 44 People at the top should have a gut feel of the happenings at Ground Zero
In some companies the head of the organization is often not aware of what’s happening at the ground zero— the workplace where the action lies. This may appear weird, but let me narrate a real incident. I was auditing a plant sometime back and was amazed to find out that log sheets had not been filled by the workmen on a number of days and deviation analysis had not been carried when the process wandered from the standard. This was contradictory to what the plant head had told me during the introduction—that they had excellent systems and the plant had made huge improvements by using tools such as Six Sigma and TPM (Total Productive Maintenance). On probing I was told that these are outliers and that my perception should not get biased. When I asked the factory head later if he took rounds of the plant, he told me that his busy schedule did not allow him to take regular rounds but he had capable managers who took DEBASHIS SARKAR
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care of the operations. The log sheets that I saw for myself spoke of a different story, unlike the claims made by the plant head. They were not only evidences of potential quality problems but issues pertaining to workmen discipline/morale. This was a clear example of how the top management is unaware of the reality of the workplace and are happy with whatever feedback they get from the operating managers. Often such feedback are sugar coated pills which give a feel good factor. It is imperative that people at the top should not get disconnected with the happenings of the workplace. All business leaders and managers should walk out of the cabins and go to the context. They should get the pulse of the workplace for themselves and should be listening to what people are saying. They should be using the opportunity to transmit the company’s values face to face and should be prepared and able to give people on-the-spot help. While during the rounds they should even be looking at things like log sheets on a production floor. This will not only make the people at the context (workplace/shop floor) alert but they will know that the person on the top means business and does not practice remote control management. These are the few things that all people at the top should do, in order to get to know what’s happening at the context:
F F 144
Reserve some time everyday to walk through all departments. Have regular meetings and reviews in the context (workplace, field, shop-floor) or at LESSONS IN SIX SIGMA
F F
F F F F
others’ offices/spaces rather than at their own office. Randomly start popping into offices and asking the inhabitants why they aren’t out. Make it a point to spend one day in a month with customers. While interacting with the salesmen in the market one can find out the ground realities and the problems that the customers may be facing. Appear relaxed while making the rounds. Employees will reflect these feelings and actions. Also, one must remain open and responsive to questions and concerns. During these strolls, one should try to find out if the operating managers are feeding him or her with the reality or only the feel good stuff. Talk with employees about their passions— whether family, hobbies, vacations, or sports. Convey the image of a coach not an inspector and encourage employees to reveal the real work of the company.
Remember that the above approach does not mean leaving your responsibilities behind as you stroll through ground zero or the context. The objective should be to have a gut feeling of what’s going on throughout the company. Six Sigma Takeaway ‘Management by remote control’ is detrimental to building quality culture in your company. DEBASHIS SARKAR
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Lesson 45 As a Six Sigma change agent, master the art of conflict resolution
In the journey of Six Sigma deployment there would be a number of occasions when you would require to handle conflicts. Conflict almost always arises when there is a contradiction between different points of view. It is important to have a method for solving conflict in the organization. Conflict often arises when groups of people work together. It is important to be able to work through conflict in a constructive way to maintain motivation within the team. Richard Hughes has prescribed five conflict resolution strategies in relation to the level of co-operation (the party’s desire to satisfy the other’s concern) and assertiveness (the party’s desire to satisfy their own concerns) that exist. First, competition is a win-lose orientation where the desire to co-operate is low and assertiveness is high. This strategy is appropriate when quick decisions are vital (emergencies) or there is no popular decision to 146
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be found (like increasing dues in order to keep operating). Second, accommodation is the antithesis of competition where co-operation is high and assertiveness low. This strategy is valuable when it is important to appease the other party (unstable personality), the issue is not very important to you, or when you find yourself in the wrong on an issue. The third strategy, sharing, is a compromise where medium assertiveness and co-operation are prominent. This zero-sum strategy may be as simple as sharing a room instead of having it to yourself. The fourth strategy, collaboration, is the acme of negotiation whereby everyone wins. This strategy is useful when both assertiveness and co-operation are high and the concerns are both vitally and equally important. This orientation is certainly the one that will require the most time and effort to resolve—but the reward is worth it. Finally, the last strategy is avoidance. You are neither assertive nor co-operative in this instance. This strategy is normally reserved for an issue that is too trivial to waste time on, used as an initial strategy to allow parties to ‘cool down’, or when others may resolve the conflict more effectively. Six Sigma Takeaway Conflicts are an integral part of all workplaces so when there are no conflicts you need to question if all is well.
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Lesson 46 A defect is one which does not meet the customer needs
You may have the best of products or service but if it does not meet the needs and expectations of customers it has no right to be in the marketplace. Gone are the days when one could be satisfied with producing and delivering products and services that met the stated specifications. Either a product or service meets customer requirements or it does not. Anything that does not meet customer requirements is called a defect. If a customer has asked for a cavier in a restaurant and he gets a sizzler, it is a defect. If an airlines traffic assistant is rude to a traveller it is a defect. So it is a challenge before the producers to understand, define and measure customer requirements. This is needed to calculate the number of defects in the service or products that the process is delivering to the customer. This is more than a methodology but a mindset that everyone in the company should adopt. It is the philosophy on which the Six Sigma concept is based. 148
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So when you define a Six Sigma project, define defects with customer dissatisfaction in mind. Commence by identifying the product you create or the service you provide. Identify the customer for your product or service, and determine what he or she considers important. Lay down processes to ensure that customer expectations are met. In case there are gaps in the process because of which customer expectations are not met, it is a likely candidate for improvement using the Six Sigma methodology. Six Sigma Takeaway Customers are too demanding these days, do not take them for granted. If you do not take care of their requirements they will desert you without even giving a notice.
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Lesson 47 Do not wait for problems to occur to initiate improvements through Six Sigma projects. Proactively take actions when precursors and evidences to a problem are seen
Virtually all problems are preceded by evidences and precursors. These could either be a ‘non-serious event’ as a hair line crack on a pipe or an ‘attention grabbing incident’ as an electric shock. They all indicate that there is a problem which has still to show up. It is like a tremor before an earthquake, a body ache before a fever or a major electric shock before a safety blowup. In most organizations I have observed that the problems are addressed only after they happen. Even after knowing the problem, it’s the symptoms of problem and not causes which are addressed; as a result the problems keep on repeating. Since the underlying causes are not identified and addressed, they continue to create recurring problems. Even with ongoing or increased efforts, the problems persist, performance is 150
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impacted, and frustration becomes the norm. Eventually, hopelessness and helplessness can invade the organization’s culture. The challenge before organizational leaders is to build a culture that promotes problem identification where the employees do not wait for problems to happen but proactively look for signals that precede the latter. The following is the list of incidences which may indicate that problems are on the horizon:
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Is there a change of event. Whenever there are problems there is a likelihood that it could be followed by a problem. Are there any precursors? This could be a machine getting hot before breaking down. This may often appear to be non serious. Is there any striking incident like the electric shock before a safety hazard. Are incidences repeating? Is there a pattern emerging from the incidences? Are there sudden complaints? Are the users experiencing problems with your products or services that you are offering? Here you need to proactively seek feedback or get into the context of the user. Are there any surprising observations? These are anomalies which could result in major incidence. These are called ‘warusa kagen’ in Japanese or things that are not problems but do not seem quite right.
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As a Six Sigma leader it is your duty to inculcate a culture of problem identification among the employees. Initiate projects when the symptoms are seen, do not wait for problems to happen. Leverage the power of Six Sigma projects for prevention. Six Sigma Takeaway Encourage your employees to come up with symptoms which are potential problems and are potential Six Sigma projects.
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Lesson 48 Look at processes end-to-end while taking up projects for improvement
When a process is taken up for improvement it is essential to look at it from end to end. This is required because if a part of the process is only improved, the customer may not feel the impact. Do not use Six Sigma for the sake of improvement but because customers can perceive the difference. This is the paradigm on which Six Sigma operates. Let me elucidate this through an example from a bank. We look at the problem of a high delivery time of cheques requisitioned at a bank branch by customers. In this bank the cheque processing is done at a central processing unit outside the branch. At the branch, only some preliminary processing is done on the basis of information provided. One approach would be to do a Six Sigma project on either Sub Process-1 or Sub Process-2. The other view could be to do a project on Sub Processes 1 and 2 as they are within the bank’s control even if they are not DEBASHIS SARKAR
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in the branch. But both approaches are flawed as despite carrying out the improvements on Sub Processes 1 and 2, the delivery time of cheques may not improve and customers may not feel the impact, as the process at the courier’s end is not being looked at and delay may be happening there. So what should be the approach? You should look at improving all the processes i.e. sub process 1, 2 and 3. The projects of each of the 3 sub processes could be done by three individuals or one person could take up a single project encompassing all the three sub processes. Regarding the process at the 154
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courier’s end, you should carry out a Six Sigma project there. Yes, it should be done with the involvement of members from the courier company as they own the processes and have the responsibility to keep the process in improved states even after the project is over. When improvements in all the processes are carried out, customers would feel the difference. And this is what Six Sigma is all about. At the end of the day, customers should feel the benefit of Six Sigma. So whenever you focus on processes for a Six Sigma project take it up from end to end or wing to wing. The process should be looked at customer’s point of view and determined the way he/she would like it to perform. Never view processes as isolated business activities but as a family of interrelated processes all working towards meeting customer requirements. Six Sigma Takeaway It is imperative that the leaders in an organization view processes not just as isolated business activities but as a family of processes which are interrelated and are working towards meeting customer requirements.
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Lesson 49 Do not launch Six Sigma with the sole idea of saving cost for your organization
It may sound queer but many organizations in India are looking at Six Sigma merely for cutting costs. There is nothing wrong in it except that focusing on cost takeout projects without the customer on the radar may not be the right thing to do. This means that organizations are focusing on improvements without collecting the voice of customers and converting it to meaningful projects. This also negates the foundation on which Six Sigma was created—that is to deliver improvements on processes which impact the customers. I know of an organization which launched Six Sigma with the sole aim of cutting costs. While projects delivered huge savings, these were at the cost of product quality and customer service. Six Sigma is like a nuclear energy which can be used both for peaceful as well as destructive purposes. Six Sigma can also be used in such a way that it does not deliver value on an ongoing basis. The reason why organizations have been using Six Sigma for cost takeout projects is because it’s the easiest 156
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way to show that projects deliver monitory benefits. There is nothing wrong in cost takeout projects but one should do it keeping the final customers in mind. The cost savings should be a by product of projects done to cater to customer needs and expectations. Let me also tell you that cost takeout projects are not sustenable over a long period. You will soon reach a point when there may not be any avenues left for waste reduction, efficiency improvement and so on. Never make this mistake of just looking at costs as you will lose the customers’ angle in the present competitive scenario. Use Six Sigma for profiting by meeting customer needs and expectations. Take up projects which grow at the top line. Involve the front room people (i.e. people from sales, customer, marketing functions) on Six Sigma projects. You will see for yourself how Six Sigma can be used to grow sales volumes, increase the effectiveness of brands, increase customer service levels and so on. So never deploy Six Sigma projects with the sole aim of cost savings. Your Six Sigma portfolio should contain projects on all areas such as revenue generation, customer satisfaction, customer retention, productivity improvement, operational excellence, cost takeout and others. But whatever you do, please do not lose sight of your customer. Six Sigma Takeaway Do not be parochial by just looking at Six Sigma for cost savings, leverage its power for driving revenue, customer retention, customer satisfaction, productivity improvement and so on. DEBASHIS SARKAR
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Lesson 50 Select the best performers to take up Six Sigma projects
To make Six Sigma successful it should be ensured that the best people are selected to work on projects. When this happens you will see that not only is there best output coming out of Six Sigma projects but also that quality gets driven by best performers. Traditionally it has been seen that a person who has not been performing well in some other function, is accommodated in the quality department. The quality function has been a place where under-performers and not the best breed are accommodated. When you ask the head of human resources about this, he/she may tell you that the top performers are required for sales, marketing, finance functions and not quality. If you want your Six Sigma deployment to succeed this should be changed. Instead of putting any one on projects, consciously depute the best people on Six Sigma. Let me tell you that this is easier said than done. It requires a complete change in the way the organization has looked at quality improvement so far. Do 158
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not forget that Six Sigma is just not about solving quality problems but a methodology to arrest critical business pains. So the likelihood of top management buy-in of deputing the best people is easier. I would recommend that since the cudgels of Six Sigma success is on the CEO and senior management team, the CEO should make a mandate that in order to rise to seniority, every person should get certified as a Green Belt or Black Belt project person. This means that he/she will have to successfully carry out improvements using the Six Sigma framework. The following is a list of initiatives that will help in ensuring that Six Sigma projects are not only taken up by the best people but is also looked at as a reward by top performers: l
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All new recruits who join as management trainees should be taken through the basics of Six Sigma and the top performers should be made to do a project in the business unit where they get into their regular roles after confirmation. Hire some people from top schools (IITs or IIMs) to take up the roles of a Black Belt or Green Belt. Send them to business after the stint gets over. All senior management team members should get certified at least as a Green Belt, which means they should have effectively demonstrated and used the methodology for improvement (The CEO should ensure that this happens). For promotions, the completion of a Six Sigma project should be made a pre-requisite. DEBASHIS SARKAR
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Those who have been exposed to other parts of a business and have proven themselves there, should man the quality function. Do not make the quality function a parking lot for nonperformers. Reward top performers by nominating them for a Green Belt programme (Black Belt may not be possible as it means taking up a full time quality role). Second the best performers from business for a year or so to take up the roles of a Black Belt. The HR policy should mention that as a prerequisite for promotion, a candidate should complete a Six Sigma project. The CEO should announce a mandate that a prerequisite for all leadership roles is that the candidate has previously been a Green Belt or a Black Belt.
Remember, Six Sigma is about world class performance so its only the top class performers who should drive it. Six Sigma Takeaway The CEO could announce that all leadership positions will only be occupied by certified Green Belts or Black Belts.
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Lesson 51 Be extremely meticulous about the Book of Knowledge being followed by the trainers to prepare your Black Belts or Green Belts
It is extremely important that the right Book of Knowledge (BOK) is followed for Master Black Belt, Black Belt and Green Belt programmes. I have been observing that consulting/training outfits in India are trying to make a quick buck by packaging everything as Six Sigma training programmes. This is because of the ignorance of organizations on what constitutes the content of a Six Sigma Black Belt/Green Belt programme. Let me give you some examples: l l
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Problem solving using 7 QC tools being packaged as a Green Belt Programme. Structured problem solving and facilitation skills, being packaged as a Black Belt programme. Black Belt programme being conducted in 5 days. DEBASHIS SARKAR
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Black Belt and Green Belt programmes not being experiential or to say that there are no examples/cases. Black Belt sessions are taken by people who have never practiced it before. ISO and TQM trainers are often resurfacing as Six Sigma trainers without any formal training. Certification does not require project execution and completion.
Some people may question why one should be particular about the programme content if it can drive improvement. While this may be true, and if low end tools are what comprises the content of a Black Belt or Green Belt programme, why is there any need to go for Six Sigma programmes. Just train them on structured problem solving. Remember, Six Sigma is a tool for breakthrough improvements which can be effective only when the combination of right tools are applied. There is a need for industry-wide standardization of content covered in the Black Belt and Green Belt programmes. So, whether you are holding an in-house Black Belt or Green Belt programme, or are sending employees for public programmme, please ascertain the content being covered as a part of curriculum. In light of this my recommendation is as follows: · Approach reputed consulting firms for Six Sigma training. Some of the names which you could look at include BMG, Smarter Solutions, Juran Institute, George Group etc. 162
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· Benchmark with the Body of Knowledge recommended by the American Society of Quality, International Quality Federation. · Ensure that certification is dependent not just on attending a training programme but also requires qualifying a certification and project completion. · Required number of days are spent on the class room session (not that Black Belt programmes can be completed in 5 days). · Ascertain if the BOK also includes cases and examples. The following is the Book of Knowledge that is followed by BMG (Breakthrough Management Group) for its Green Belt and Black Belt training which is extremely comprehensive:
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Green Belt Adult Learning Process Six Sigma Overview Project Definition Minitab Tutorial Introduction to Basic Statistics Process Mapping Cause and Effect Tools Measurement Systems Analysis Capability Analysis Graphical Techniques Process FMEA Confidence Intervals Intro to Hypothesis Testing Mean Testing DOE Introduction Full Factorial Part I 2k Factorials Part I
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Black Belt Adult Learning Process Six Sigma Introduction Blueprint for Breakthrough Project Definition Project Scoping Tools Computer Familiarization Minitab Basics Part I Introduction to Basic Statistics Project Planning & Deliverables Six Sigma Introduction Project Definition Rolled Throughput Yield Process Mapping Process C&E Minitab Introduction Basic Statistics Capability Analysis
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Introduction to Control Control Methods Introduction to SPC Variable SPC
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Measurement Systems Process FMEA Graphical Data Analysis Correlation and Regression Central Limit Theorem Confidence Intervals Hypothesis Testing Sample Size Selection One-way ANOVA Introduction to DOE Full Factorial Elements Full Factorial Simulations 2K Factorials Part 1 Statapult Exercise #1 DOE Sample Size Selection 2K Factorials Part 2 Fractional Factorials EVOP/PLEX Response Surface Designs Multiple Regression Intro to Control Methods Intro to SPC/SPC Lean & Six Sigma Synergy Process Control Plans
Companies should be extremely careful about the Book of Knowledge being included in Black Belts and Green Belts programmes. If you are not careful you may get into the trap of trainers who package low end tools in the Black Belt and Green Belt book of knowledge. Six Sigma Takeaway There is a need to standardize the Book of Knowledge and Certification process of Black Belts and Green Belts. 164
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Lesson 52 ISO 9001:2000 Quality Management System serves as an excellent platform for Six Sigma deployment
While it is not a must, but it helps to go in for an ISO 9001:2000 certification before setting out on a Six Sigma implementation. What are ISO 9001:2000 standards? They are an international quality management standard intended to increase organizational effectiveness by focusing on the management of key business processes. The intent of ISO 9001:2000 standards are to: # Provide an effective linkage between an organization’s quality management and it’s ‘core processes’. # Improve organizational performance. # Increase customer satisfaction. A documented quality system like ISO 9000 would put your house in order and also facilitate Six Sigma deployment. It not only acts as a guide for your employees to do consistent work but also clarifies work DEBASHIS SARKAR
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requirement and responsibilities. So what are the benefits of ISO implementation which can be an enabler in the Six Sigma deployment? · Processes are clearly laid out and interactions between them identified. · Clearly defined responsibilities and authorities within the process areas. · Provision of assurance that infrastructure is sufficient to meet the laid down organizational quality objectives. · Provision of a framework to review work continually. · Emphasis on close communication with customer. · Process measurements are put in place. · Institutionalization of a robust audit framework to continually ascertain the health of the quality management system. · Forces organization to look at correction, corrective actions and preventive actions. · Deployment of an effective management review process. · Lays the seeds of quality culture and awareness. · Puts the organization on a continual improvement trajectory. Other than the above, an effective ISO certification helps people to communicate faster and with less friction because everyone’s understanding of terms and procedures is the same. A business that follows the ISO 9000 standards will usually eliminate wasteful and 166
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careless practices that can drain their profits. ISO-9000 systematically addresses every area of a business where quality problems can occur. It does this by requiring that the management defines the potential problems and implements appropriate practices to prevent them. Probably the biggest benefits of ISO 9001:2000 which act as enablers to Six Sigma deployment are its focus on (a) process, (b) continual improvement, (c) measurement, (d) customer focus and (e) leadership. To summarize, before launching Six Sigma ensure that well-defined processes are in place. This can be easily achieved through the implementation of ISO 9001:2000 standards. ISO 9001:2000 standards also require organizations move into the trajectory of continual improvement and this can be attained through Six Sigma implementation. In a nutshell Six Sigma and ISO are implementary. Six Sigma Takeaway It helps to go in for an ISO 9001:2000 certification before launching Six Sigma in the organization.
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Lesson 53 Banish waste by enmeshing Lean Thinking with Six Sigma methodology
These days there is a lot of hullabaloo and excitement about Lean Six Sigma. Quite a few practitioners advocate that instead of Six Sigma, organizations should implement Lean Six Sigma. This is quite confusing given the fact that the concept of Lean is not known to many. So, what is Lean Thinking? According to the National Institute of Science and Technology, USA; Lean is a systematic approach to identifying and eliminating waste (non-value added activities) through continuous improvement by flowing the product only when the customer needs it (called ‘pull’) in pursuit of perfection. The genesis of Lean Thinking is the Lean Manufacturing philosophy which got visibility due to a ground breaking study of Toyota Production Systems by a team of researchers led by James Womack and Daniel Jones. To get a clearer understanding of the Lean philosophy, I would 168
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recommend reading the book Lean Thinking—Banish Waste and Create Wealth in your Corporation, by James Womack and Daniel Jones. Lean and Six Sigma are not mutually exclusive— rather they are complementary. Lean initiatives are great for boosting productivity, changing culture and cleaning up workplaces. However, they do not offer the power tools when it comes to fixing chronic issues. Six Sigma programmes, on the other hand, are popular, focused and effective. But projects take months to finish, and the programme creates Black Belts, who are often disconnected from shop floor/workplaces . Companies across the spectrum have found the most effective way to eliminate flaws that lead to rework and scrap, and arrive at one unified idea of continuous improvement by combining Lean and Six Sigma. Lean manufacturing tools are great for reducing process time and improving such things as safety, floor space usage and cleanliness. Six Sigma can help if products keep failing repeatedly. For this a detailed root cause analysis is required using Six Sigma. When the focus is to reduce waste and improve efficiency of a process, lean tools should be leveraged. When the goal is to reduce variation and improve performance, use Six Sigma methodology. Lean brings action and intuition to the table, quickly attacking low-hanging fruits with Kaizen events. Six Sigma uses statistical tools to cover root cause and provide metrics as mile markers. A combination of both provides the tools to create ongoing business improvement. DEBASHIS SARKAR
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By looking at projects through both the lean and Six Sigma lenses, we shall have the precision and actionable tools needed to find hidden problems while making sure we don’t overlook the obvious. Remember, Lean methodologies must be completed first to maximize the Six Sigma gains, the belief being that if the process is not lean, Six Sigma efforts will be sub-optimized. Six Sigma Takeaway By looking at projects through both the Lean and Six Sigma lenses, you shall have the precision and actionable tools needed to find hidden problems while making sure we don’t overlook the obvious.
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Lesson 54 Appoint a Chief Process Facilitator for all Six Sigma team processes in your company
It would be a good idea to have a Chief Process Facilitator (CPF) in your company who is responsible for the facilitation of all Six Sigma team processes. Some people may say that the project team leaders (i.e. Black Belts/Green Belts) should have been trained as facilitators so there is no need to have another position created for this exercise. Do not underestimate the process of facilitation as practicing the art of excellent facilitation is more demanding than definitions might indicate. My observation is that Black Belt/Green Belts are good on tools but often lack the required facilitation skills. As a result it makes all sense to appoint a person who guides without directing, brings about change without disruption and brings down walls which have been built by people. A CPF works with all Six Sigma teams and assists them in freeing itself from internal obstacles so that it may effectively pursue its objectives. The facilitator acts as a catalyst, precipitating effective group actions DEBASHIS SARKAR
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independent of its specific work product. The CPF also prepares facilitators in each function/department/ business-group who become the in-house resource, while CPF remains as the corporate resource. The Chief Process Facilitator provides opportunities for interaction among facilitators so that they can further refine their skills by sharing experiences with each other. In working with most challenging situations, a ‘facilitator’ needs to be flexible and clear with himself/ herself and the team members, about where on a wide spectrum of roles, he/she contributes to the creative design or problem-solving process. Other roles of a facilitator are: l
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Assisting the team leader in structuring or breaking down a task into individual assignments. Looking at ‘how’ decisions are made rather than ‘what’ decisions are made. Maintaining focus on the team process more than the team product. Studying and using the teachings of Six Sigma quality improvement. Helping team members to become more comfortable with the scientific approach, including teaching data collection and analysis techniques. Continually developing personal skills in facilitation, group processes, and planning, including when to employ interventions and how to teach such skills to team members. Encouraging the groups to seek the causes of problems before identifying solutions. LESSONS IN SIX SIGMA
Who can be a process facilitator? Ideally he or she should be a person who is familiar with all the operations of the company and should be trained in facilitation skills. Effective facilitation is by no means an easy task, but as more and more Six Sigma project leaders come to understand what facilitation means, begin internalizing and practising the philosophy, the payoffs in terms of enhanced productivity will be visible. Facilitation is all about helping Six Sigma project team members to behave in a particular way towards achievement of any of the three goals: l l l
Accomplishment of the project goals. Resolution of internal group problems. Ability of the team members to work together effectively as a group.
Six Sigma Takeaway A facilitator fosters self-discovery of alternatives and solutions by protecting team members from attack, so members feel secure in sharing ideas and thoughts.
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Lesson 55 While focusing on primary metrics do not forget to keep the secondary metrics on the radar
Organizations implementing Six Sigma projects confine themselves only in monitoring the primary metrics of the project. While these metrics should be on the radar, do not forget the secondary metrics. Primary metric is the measure used to determine the success or failure of a project. When you set out to do a Six Sigma project it is the measure that is tied to the problem statement. It is the measure which is used to track progress once a project gets over. The movement of primary metric determines the process performance over time. It is the primary metric which is used to determine the benefits or financial gains of a project. The primary metric is monitored by the Process Owner and Champion to ascertain the voice of the process after the project completion. But there are certain other metrics which you should also track along with your primary metrics. These are called the Secondary Metrics or Consequential Metrics. 174
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These are used to track unintended consequences due to the process improvement emanating from the project execution. For example, an organization implemented a Six Sigma project on optimal utilization of HDPE (high density poly ethylene) material used for manufacturing 100 ml bottles for packaging oil. The problem being faced by the organization was that the HDPE consumption had a huge variation. While the standard consumption of HDPE should have been 14 gms, the actual consumption ranged from 13 to 19 gms. As a result the company lost about Rs 2 crore every year. After the Six Sigma project, the variation in HDPE consumption per bottle came down to 12–15 gms from the earlier 13–19 gms. The project was declared a success and everybody celebrated its success for more than a week. However, after two months complaints started pouring in from the customers. They complained heavily of leakages due to pin-holes. On probing it was found that bottles in which 12 gms of HDPE had been used had too thin walls which cracked during transportation. The lesson for the organization was that while they tracked the primary metric (material consumption in this case), they did not bother to monitor the secondary metrics which was ‘leakage levels’ in the modified bottles. Remember, when you are through with your project execution, commence monitoring the secondary metrics. The team members in the project as well those associated with the process should tell you the consequential metrics which need to be monitored. Specifically remember, the improvements carried out in one area should not lead to a disaster in another area. Finding the secondary metrics is not easy. This is where DEBASHIS SARKAR
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the pessimists of the team add a lot of value to find out what can go wrong. After the projects get over, a whatcan-go-wrong analysis helps in safeguarding other problems. Six Sigma Takeaway Once your projects get over, do not forget to track the secondary or consequential metrics with your primary metrics.
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Lesson 56 Six Sigma deployment may be a mirage for small sized companies but there are ways to go about it
If you see Six Sigma deployment in India you will observe that it is largely confined only to large sized corporations. There are reasons for it, the key ones being cost and personnel. Whether we like it or not Six Sigma deployment requires a lot of money and time of employees which small companies cannot afford. The following are the reasons why Six Sigma deployment is still a mirage for small sized companies: l
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For deployment in initial days, Six Sigma requires support from external consultants. And this is really expensive. Consultants who know the stuff do not come cheap. A Black Belt programme requires a training of 3–4 weeks spread over 3–4 months. This is often difficult, in a small company which has say 20– 50 people, can one afford to send 2–5 people DEBASHIS SARKAR
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for a Black Belt programme over such a long duration? Training one or two employees, could also mean running a risk of creating talent for other organizations, by creating potential recruit for other companies. Unlike larger companies, savings potential in small sized companies may not be as great. This is because in large sized companies, the number of processes are more and the potential is significant prior to Six Sigma implementation. In small companies where the number of processes are less, the return on investment may take a longer time.
Is there no way out? Not really. Small sized companies can take up the following approach which may facilitate Six Sigma deployment: l
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Hire a Six Sigma Master Black Belt—who acts as a consultant, provides direction and does the required hand-holding. He or she should spearhead the deployment. Let the CEO or a senior person (who has vested interest in the company) attend a Black Belt programme. This avoids the situation where one or two people get trained who then later get hired by other organizations. Instead of full time Black Belts, create part-time Black Belts who together with regular work carry out Six Sigma projects. LESSONS IN SIX SIGMA
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Pilot one initiative in one area of the business. The learnings from this project could give leads on potential challenges in future deployment of Six Sigma projects. Since in-house programmes are expensive, the selected people can be sent to open enrolment programmes.
Other than the above, it would be a great idea if eminent practitioners in the field of Six Sigma come together to provide consultation to the small sector at costs which can be borne by them. Also, industry bodies and management institutes can provide Six Sigma Black Belt training and other support so that small sized companies can be hand held for deployment. Despite the above hurdles, small companies provide some great conditions for Six Sigma deployment: l l
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Decisions are fast as the hierarchial layers are less. Since small companies are agile, the recommendations of Six Sigma projects are quickly implemented. The senior management being close to the people, they are aware of what’s happening in the shop floor. Hence senior management should be virtually aware of what’s happening on each project.
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ultimate impact of Six Sigma will be felt by the Indian industry as a whole when the small companies who form the substantial portion, are able to successfully deploy it. Six Sigma Takeaway Six Sigma is not just for large companies, small companies can also leverage it for their benefit if customized and supported well.
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Lesson 57 Do not get perturbed if data points in your Six Sigma project have a non-normal behaviour
Six Sigma assumes that data will be normally distributed. Most of the tools that are used in Six Sigma assume that the data is normal. As a result you will see that at quite a few places one tests normality and then goes ahead. However, as you begin working on projects you will see that normal distributions are not always the norm. There are many instances when data may not be normally distributed. Let me give you a few examples: l l
Customer waiting times in a call center. Turn around time/cycle time projects.
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Remove outliers which may be making your data points non-normal. Ascertain if two or more populations/processes are mixed. Convert data into rational sub-groups and take the average of sub-groups. Transform data. Use distributions other than the ‘normal’ for solving the problem. Use non-parametric statistics.
So, whenever there is non-normal data do not get worried. Either get in touch with your Master Black Belt or talk to a statistician who has been involved in such projects earlier. The Six Sigma book of knowledge should ideally deal with such cases. The objective of this lesson is to bring out the point that it is quite normal to get non-normal data but we should know how to deal with them. Six Sigma Takeaway While Six Sigma assumes normality, it is okay to get non-normal data.
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Lesson 58 Deployment of Six Sigma does not come cheap. Keep this in mind before setting out on a Six Sigma journey
Whether one likes it or not Six Sigma deployment does not come cheap. The costs are typically dependant on the size of the organization, scale of deployment, number of Six Sigma resources (Black Belts, Green Belts) required and number of projects that will be taken up for execution. In light of this, before setting out on a Six Sigma implementation, an organization should know what will be the likely expenses of the initiative. The following is a list of some key cost heads which an organization should be willing to absorb as it sets out on Six Sigma implementation: l
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(per annum) for a Black Belt in India ranges from Rs 10 lacs to Rs 20 lacs. A Master Black Belt’s cost to the company (per annum) ranges from Rs 18 lacs to Rs 30 lacs. Remember, these are the costs of potential recruits who have had their grilling in companies such as General Electric, Motorola and so on. The costs are currently high as the breed of Master Black Belts and Black Belts are less. As Six Sigma popularizes in India, the number of available resources in the market will be more and the costs are bound to go down. Consultant Costs—As an organization sets out on a Six Sigma implementation, it will require a consultant who helps in scripting the roadmap that needs to be taken. The consultant also supports the employees on tools, techniques and learnings, as they get trained as Black Belts and Green Belts. Do not compromise on the quality of consultants. Even if you have to pay a bit more, go for the best person in the marketplace. This is to ensure that your Six Sigma deployment happened under the guidance of someone who knows what is to be done and what is right for the company. Training Costs—Good trainers of Six Sigma do not come cheap. Whether you hold an in-house programme or send your people for public enrolment programmes, training for Black Belts or Green Belts are expensive. For a large sized organization, in-house programmes make economic sense. This is because volume discounts can be negotiated and there would LESSONS IN SIX SIGMA
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be no travel, boarding and lodging expenses for attending a public enrolment programme. Elearning programmes are now available in the marketplace for Black Belt and Green Belts, but it is always better to go in for class-room sessions for purposes of certification. Awareness—To create awareness among employees, every employee needs to be taken through the basics of Six Sigma and how it can be a lever for business improvement. These are over and above the Black Belt/Green Belt programmes. The endeavour should be to touch each employee through this initiative. This cost will be minimal in small companies but can be huge for large corporations located across locations and geographies as it means recruiting a set of trainers travelling all across to accomplish this. In case an organization is technology equipped, one can place e-learning materials which can be accessed by anyone anytime. But this would be a sizeable expenditure in case an organization does not already have e-based instruction materials. Rewards and Recognition—This may be small compared to the above but should be kept on the radar. This cost will be dependant on the type of rewards and recognition an organization wishes to design for Six Sigma implementation and the monitory payout incurred through gain-sharing and others. Project Tracker—This is required specially for large sized companies which expects to carry out a number of projects simultaneously. The DEBASHIS SARKAR
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project tracker helps in monitoring the projects and their status vis the plan. An organization could start with an Excel based tracker and gradually get into an automated tracker. An organization where lesser number of projects get executed, an automated tracker is not required. Knowledge Management (KM) Framework— An imperative in large sized organization where the number of projects are higher, the Knowledge Management platform facilitates storage and sharing of best practices. The KM platform is used to share knowledge across the corporation across regions and locations; and prevent improvements to stay in pockets of the company. In case your organization already has a KM platform, just leverage it for Six Sigma. Or else, one can buy one from the marketplace.
The above is not to give an impression that Six Sigma is only for companies with deep pockets. There are ways out for small sized companies which I have discussed in some other lesson. Organizations should treat the above as an investment which should be ploughed back after successful implementation. Also, with increasing competition among trainers and consultants, the prices will also go down. Six Sigma Takeaway Cost-savings measures should always be looked at with caution. Look at the costs as investments.
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Lesson 59 Avoid pre-conceived solutions from getting forcefitted into a Six Sigma methodology without any data analysis
As a champion or the head of a Six Sigma project you have to be constantly on the watch out to see that preconceived solutions are not getting force-fitted into a Six Sigma methodology. It may sound strange but I have seen it happening in a number of organizations which are into Six Sigma deployment. In case this happens, an organization loses a valuable Six Sigma resource (i.e. Black Belt/Green Belt) on projects which otherwise could have been deployed on a problem whose solution is not known. Remember, if you know the solution just do it. You do not need a Six Sigma project for it. Let us understand why and when this happens: l
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when the senior management is ready to do anything in the name of Six Sigma. Non-serious candidates have been co-opted to take up the role of Black Belts or Green Belt. And they just want to complete the projects for the certification. Improvement opportunities have not emanated from a proper project selection exercise and have not been validated by a Quality Council/ Process Council either at a corporate level or business unit level. The organization’s focus is on the quantity of projects instead of quality of projects; as a result people take up any projects. Projects on completion (includes solutions) are not being validated by the Head of Six Sigma or Master Black Belt.
To ensure the above does not happen all projects taken up for implementation should have been validated by a Quality Council. Also, when the company is huge and the number of projects go up, it may not always be possible to get all the projects validated by the Quality Council at the corporate level. In such a case, ensure that a Quality Council is created at the business unit/departmental level which functions as the Quality Council at the corporate level. All projects of that business unit/department should then be approved by the business unit Quality Council. An organization could also have a Process Council which decides and validates the projects which are taken up for improvement. After the approval of these councils, it would 188
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always make sense for the Six Sigma infrastructure team to run the projects through a filter, the details of which have been discussed in Lesson 35. Projects wherein the solutions have been force-fitted can be found out with a bit of probing from the quality of data and analysis during the projects. So it is important that the Head–Six Sigma or Master Black Belt should go through each project and do a detailed validation. Remember, the worst thing to happen is when solutions are being force-fitted into Six Sigma methodology. It clearly indicates that all is not hunky-dory in Six Sigma implementation. The suggestion here is to immediately find out why this has been happening and put in place corrective actions. Six Sigma Takeaway When solutions get force-fitted in Six Sigma methodology, find out why this has been happening and whether it is a symptom of any other organizational problem.
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Lesson 60 The Human Resource Department cannot be a sleeping partner in Six Sigma deployment
Since people are central to Six Sigma methodology, it is essential that the human resource department get involved in it. Six Sigma is just not about tools and techniques but about building a culture. This is where the Human Resource (HR) department has to play a stellar role. It has to create a culture that facilitates Six Sigma. The following is a list of other areas where the HR department has to contribute in a Six Sigma journey: l l
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Hiring the required Six Sigma talent i.e. Master Black Belt, Black Belt and Green Belt. Work out a compensation and benefits package that facilitates recruitment and retention of the best Six Sigma talent (Good Six Sigma talent is still scarce in India and headhunters are after them). Design a desirable rewards and recognition plan that allows for superior performance. LESSONS IN SIX SIGMA
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Ensure the best people are deployed on Six Sigma projects. Ensure business leaders are evaluated on Six Sigma deployment and project execution through metrics such as projects sponsored, projects completed, benefits from project, number of Black Belts/Green Belts in the business etc. Encourage management trainees and all new recruits to be exposed to the basics of Six Sigma. Make star performers among the new joinees to work on Six Sigma projects, after making them Black Belts or Green Belts. Provide support to non-technical training programmes such as change management, facilitation etc. Make the achievements in Six Sigma deployment a criteria for taking up senior management positions. Ensure there is cross functional movement between Six Sigma teams (i.e. take up position of Black Belt/Green Belt) and other departments. Make all existing senior management staff (including the CEO) undergo a Green Belt programme which means they work on a project as members to feel the rigour for themselves. Regularly seek feedback from the employees on their voice on Six Sigma implementation.
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institutionalization of Six Sigma is all about change. Change starts with people and it entails unfreezing of old behaviours and refreezing new behaviours. HR has to play a major role in convincing people as to why Six Sigma should be adopted and how he/she and the company will benefit from it. Unless the individual is willing to change his or her behaviour, no change is possible. HR should also work with the Six Sigma team to create internal support network which allows Six Sigma to seep deep and wide with the organization. Six Sigma Takeaway Human Resource department should facilitate change that allows Six Sigma to penetrate deep and wide within the organizational fabric.
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Lesson 61 Six Sigma framework does not act at cross purposes in an organizations journey towards achieving business excellence
Quite often people have the notion that Six Sigma acts at cross purposes with business excellence models. They believe that the Six Sigma initiative derails previous work done in the arena of excellence models. This is absolutely incorrect and it is a result of ignorance about what Six Sigma is all about. Six Sigma can be easily integrated with business excellence assessment models such as the Malcolm Baldrige Award or European Quality Award or even Indian models like CII-Business Excellence Award, Golden Peacock and Rajeev Gandhi National Quality Award. It is important to note that business excellence models look at an organization from a holistic perspective while Six Sigma is a tool for process improvement. By using an excellence model you are actually ascertaining the health of a company with respect to a laid down criteria, while Six Sigma focuses on a specific process. DEBASHIS SARKAR
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The excellence models have themes which propel an organization to the trajectory of performance excellence. The themes are typically around: Leadership, Strategic Planning, Customer and Market Focus, Information Analysis and Knowledge Management, Human Resource Management, Process Management and Business Results. The criteria can vary depending on the excellence model we are gunning for. Six Sigma can be an excellent enabler in achieving the desired level in each of the criteria. It can help an organization to achieve and sustain the desired level of performance by bridging gaps identified through assessments by process improvements. Let me just give you a few examples. The excellence models ascertain how the leadership team sets direction, creates customer focus and values, sets short-term and long-term goals, communicates performance expectations, promotes organizational excellence, fosters innovation and promotes organizational learning. Six Sigma framework can be an enabler here as it helps to understand markets and customer requirements, develop appropriate strategies, set improvement opportunities and organizational resources to address performance gaps. On the strategic planning process, the excellence models unfurl how a company develops strategic objectives and action plans. Six Sigma practices can not only be used for the process of strategic planning but can also be an enabler in the achievement of strategic goals. This would entail working around the core processes and establishing metrics to drive results. 194
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To understand the customers and marketplace, Six Sigma can be used to work out a solid voice of customer strategy that aids in understanding the voice of customers, markets and stakeholders. A very important criteria of the Six Sigma methodology is to build a process management framework. The business excellence models essentially try to unplug the key aspects of a company’s process management system. It endeavours to identify how processes are designed, how they meet performance requirements and what specific measures are used to improve and monitor these processes. Six Sigma framework enforces that processes are scripted not around functions but around customers. It means laying down end-to-end processes which cut across functions (organizational silos), around customers with a measurement system. Once processes on these line are in place, the effort should be to constantly improve the processes so that customer requirements are consistently met. The business excellence models focus on business results and the assessment tries to identify the company’s performance in areas as customer satisfaction, product/service performance, financial results, market share and so on. Six Sigma can help here by building a performance scorecard and dashboard to track and monitor these performances on a regular basis. Scorecards give a bird’s eye view of critical business performance indicators as viewed by the customer and stakeholders. Dashboards typically provide an overview of project status (and their metrics) and performance of core processes. DEBASHIS SARKAR
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The above are just a snapshot of how Six Sigma enables the achievement of excellence along the lines mentioned in business excellence models. It is not a deterrent as many people believe, but an enabler in achieving the levels of business excellence as stipulated in many awards. Corporates should use an excellence model for continuously checking the health of the organization. It is the best vehicle on which to commence a journey to achieve excellence. Trained assessors should carry out internal assessments every year to find out where they stand. The gaps that emerge from the assessment can be plugged by leveraging the power of the Six Sigma technique. Remember, the emphasis on statistical concepts and measurement system make it an excellent and credible mechanism to track performance. In short, Six Sigma is a very effective deployment vehicle to achieve business excellence. Six Sigma Takeaway Six Sigma is an effective method to achieve business excellence by leveraging people, processes and performance.
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Lesson 62 Once processes are improved using Six Sigma methodology, it is important to take an all encompassing approach to ensure that the improvements are sustained
It has been seen that processes where Six Sigma has been used for improvement often go back to its original state. This is not because of a lack of organizational will but because of the fragmented nature of implementation. Often process owners do not take a holisitic approach which results in the breakdown of a process control system. The following is a suggested list of activities which together can put in place an effective system for process control: l
Clearly follow the process documentation. At the end of each project all process control, measurement and process control procedures need to be documented. Never try to skip the laid down processes that have emanated from the rigour of Six Sigma. DEBASHIS SARKAR
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All people involved with the process should be trained on details pertaining to the process control requirements. Training should specifically include topics such as control charts, calibration, measurement system and so on. All operators of the process should be made aware of the product specifications and what is acceptable to the customers. Identify the Critical to Quality (CTQ) parameters or product features which directly or indirectly impacts customer satisfaction. Ensure that the measurement system that was put in place during Six Sigma are well controlled. All measurement instruments and processes should be fit for use and should be continually checked for suitability and effectiveness. The vital few Xs identified during the improvement of the process should be clearly known to all process operators. These are the factors which finally affect product quality and the operators should know the magnitude and the numerical sensitivities of each of these parameters to the product CTQs. The sampling plan should be known to all operators. This is required for them to know where to take measurements from, how many to take and the frequency for the same. Use the right control chart to detect ‘out of control’ conditions. As stipulated during the improvement process, plot charts for both lagging and leading indicators. What is critical LESSONS IN SIX SIGMA
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here is that the operators should be aware of how to plot/draw control charts and the decisions or rules for ‘out of control’ conditions. Follow the Out of Control Action Points (OCAP) when processes go out of control. OCAPs are guidelines for process adjustment. Carry out the specific adjustments where required so that immediate corrections can be made when processes go awry. Periodically audit the processes to check the performance of the process. It shall give an independent view on how the process control system is working. Audits give the management a voice of the process and clarify what specific corrective actions need to be put in place when they go haywire.
When the above are followed you will see the fruits for yourself. The products will consistently meet the stipulated CTQs of the product and process. Six Sigma Takeaway Never use a fragmented approach to process control.
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Lesson 63 Process audits are an integral part of Six Sigma deployment
Developing a strategy for process audits is one of the imperatives in your Six Sigma journey. This is one of the most effective tools to ascertain the status of improvements made. Internal auditing is a proactive process of identifying whether documented procedures emanating form Six Sigma projects are being followed. Once the projects get over and improved processes are taken up by process owners, it is these audits that inform the management whether the process controls are being followed. When a process is continually audited for conformance, ineffective procedures are identified and members can take corrective actions which they would perhaps overlook during day to day operations. Other than ascertaining the health of the processes, audits yield the following benefits: 1. Increases management confidence by ensuring that improvements are sustained. 200
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2. Helps to identify system and process deficiencies. 3. Allow for members to be closely involved in improving and refining processes and systems. 4. Helps in taking corrective actions before it becomes a consumer issue. 5. Proactively unfurls non-compliances vis-à-vis the laid down system. 6. Supports identifying training requirements of people associated with the process. 7. Ascertains gaps in documentation and measurement system. 8. Allow for internal consultancy and crossfertilization of ideas—the experience and expertise of auditors can be used to resolve chronic issues. The audit findings are directly reported to the top management team and are actually an independent evaluation of the process improvements, which they can bank on. Auditors are the watchdogs of the processes on which improvements have been carried out. The following is a list of some of the points around which audits are carried out: l l l l l l
Documentation. Data Collection Mechanism. Measurement Systems. Process Ownership. Capability with the process stakeholders to ensure improvements stay sustained. Sigma Trends. DEBASHIS SARKAR
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Review of metrics after the projects have got executed. Status of the mistake-proofing devices. Learnings from the projects.
As you deploy Six Sigma, make sure a team of quality auditors are also put in place. The audit team should be an independent entity, which should directly report the findings to the top management of the organization. These people should also know what Six Sigma is all about and should have been trained on audits of quality systems. When an organization begins its Six Sigma journey it may be worthwhile to even outsource this activity, as there may not be people who are trained on Six Sigma methodology. As the journey matures and there are a number of projects which could have happened, put some ex-Black Belts or Green Belts on a full time audit role. Remember, do not keep process audits on the backburner. It is an imperative for the sustenance of Six Sigma within the organization beyond the projects. Six Sigma Takeaway Audits are an independent evaluation to ascertain the efficacy of process improvements carried out through DMAIC framework.
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Lesson 64 Use Brown Bags to make your employees refresh their knowledge on Six Sigma tools and techniques
As you implement Six Sigma in your organization it would make immense sense to continuously hold sessions on various Six Sigma concepts, tools and techniques to educate the people. This is required as you will often experience that the rationale behind quite a few tools may not get addressed during Black Belt/ Green Belt classroom sessions. For example a Black Belt programme may just tell you that to test the normality of a data set, you need to use the Andersen Darling Test and that the Minitab software may just execute actions for you. To get more details on the concepts behind this test, a session later always helps. This is where a power tool called the Brown Bag is of a huge help. This initiative is also required for Six Sigma team members who do not undergo exhaustive Black Belt/ Green Belt class room sessions. But what is a Brown Bag? DEBASHIS SARKAR
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A Brown Bag refers to an inexpensive, educational session conducted during breakfast, lunch or snacks for potential Black Belt/Green Belt, existing Black Belts/ Green Belts, project team members and anybody interested in the subject. The sessions are conducted by the employees and are meant for the employees. The objective of this tool is to help employees with concepts of Six Sigma and the tools involved therein, without going in for an offsite training. These sessions are voluntary, so they should be made attractive by offering the finest lunch/snacks. You could even distribute books/cassettes on relevant topics so that it acts as an incentive for the attendee. Master Black Belts, Black Belts or any other person in the company who is adept in the topic under deliberation, takes employees through the concepts while they enjoy a bite. For example, the company statistician may hold a session on hypothesis testing for Six Sigma leaders (i.e. Black Belt/Green Belt) and Six Sigma team members. Or you could entrust a Six Sigma team member to come prepared on a topic (say for example—Quality Function Deployment), which he/she could share during a Brown Bag. I have tried this very successfully and it yields huge results. The following is a list of headlines which you should remember for a successful execution of a Brown Bag: l l
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Focusing on time is essential. Do not make sessions too long. Ensure that sessions get completed in the stipulated time. Remember, if the session is too long people will not attend such sessions in the future. Make sure that the senior management team members attend a few of these Brown Bags, especially when you launch the initiative. Do not make the sessions too theoretical. The concepts should be laced with real life examples.
When you launch a Brown Bag, the attendance may be very poor. Do not get perturbed. Continue with the Brown Bags and do a good job. Very soon the word will spread and people will start attending the session. Six Sigma Takeaway Brown Bag sessions increase knowledge of employees on Six Sigma and its associated tools and techniques, at a minimum cost.
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Lesson 65 Bolster your Six Sigma journey with a Solid Rewards and Recognition Scheme
Rewards and Recognition (R&R) should be an integral part of an organization’s Six Sigma deployment. The goal of a R&R programme should be to reinforce the desired behaviour which drives improvement and pushes the cause of Six Sigma. When employees know their efforts are appreciated, it increases their selfesteem and satisfaction. But, regular appreciation cannot become a habit by accident. You have to create a system whereby appreciation and thanks will be more common than criticism and complaints. But before your script a system, you should remember the following: l l l l
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Rewards and Recognition practices for Six Sigma deployment broadly fall under two heads: 1. Non-monetary Reward Practices. 2. Monetary Reward Practices.
1. Non-monetary Reward Practices These rewards typically involve the feelings of accomplishment or self-worth an employee derives from doing a good job. These do not directly deal with money and should be administered by the corporate Six Sigma cell of a company, with or without the association of the Human Resource Department. The Non-monetary rewards are important motivators for improvement and could meander around the following ideas: 1A. Publicity The most common form of recognition is publicizing achievements. Examples are: 1. Bulletin Boards, 2. Newsletters, 3. Formal Presentations. 1B. Tokens These are the most common gifts used to spontaneously recognize specific acts. Examples are: 1. Badges/epaulettes, 2. Key Rings, DEBASHIS SARKAR
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3. Mugs, 4. Points/cheques (Team members receive points for every quality improvement idea/solution accepted, which they can redeem for small rewards), 5. Complimentary restaurant passes. 1C. Awards These awards are extremely popular in most organizations treading on a Six Sigma journey. These awards are open to all and should be designed in such a manner that employees must perceive the criteria and selection process to be fair. (a) CEO’s Award This is given to those individuals who exemplify the values that build Six Sigma such as: leadership, customer delight, involvement, team work, commitment, continuous improvement and significant contribution to quality movement every day. These awards are generally given once a year and nominations take place by way of an open process. Any employee may nominate another upward, downward or horizontal employee who demonstrates a year’s worth of commitment to the Six Sigma values that the company lays down. (b) Team Award This award is given to a Six Sigma project team that has successfully carried out a project which has not only yielded major financial benefits but has also led to a substantial increased customer satisfaction level. This award could be given on a quarterly basis and is ideal 208
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when an organization is setting out on a Six Sigma journey and has a task of making Six Sigma a way of life. (c) Supplier/Vendor Awards These awards are targeted to suppliers/vendors who have successfully deployed and used Six Sigma for improvement. (d) The Invisible Champion This award is targeted to recognize individuals, who represent a strong, yet unseen force which has a profound effect on the Six Sigma movement in a business or department. This award is to recognize individuals who contribute solid and consistent devotion to the job and the team with their ‘behind the scenes’ efforts. (e) Award for Maximum Improvement This award is given to a team/department/business where there has been maximum improvement using Six Sigma methodology. ( f ) Luncheon/Dinner with MD/Board Member This is awarded when a person has championed a major Six Sigma project to successful completion. Such an award not only reinforces how important the person’s contributions are, but also allows him/her to reminisce about the hurdles he/she overcame and other ‘war stories’ of the project. (g) Paid Holiday Here a team or a person is sent on a paid holiday when they/he/she successfully completes a Six Sigma project. DEBASHIS SARKAR
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(h) Quality Based Promotions Here the promotion is based primarily on the achievement of Six Sigma goals. (i) Best Black Belt or Green Belt Project This award targets the best Six Sigma Black Belt or Green Belt project. Projects are evaluated on criteria such as: Quantum of improvement, customers’ voice, cycles of sustainability, team awareness, team effectiveness, measurement system, documentation, voice of customer, voice of champion, lessons learnt, audit results etc. (j) Best Business Unit Relevant to companies having multiple business units or plants or departments, this award recognizes the best business unit, plant or function; for Six Sigma deployment. The evaluation is on criteria such as: Champion’s/business head’s/functional head’s/plant head’s/locational head’s involvement, number of Six Sigma resources, quantum of improvement, number of projects successfully completed, Six Sigma penetration and so on. 1D. Reward by Name People love to hear their own names. These awards parley the power of names into a reward system. 1. Designate Here, a day is named after a Six Sigma project team member. A day of appreciation is named after a deserving employee during which the team goes out 210
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for lunch/dinner to felicitate the employee being honoured. The departmental head personally thanks the honouree for his/her contribution. 2. Title An office location is named after a team member. For example: The ‘Ram Taneja corridor’ or the ‘Sudesh Parekh’ conference room. This honour is rotated after every few months. 1E. Training and Development While we should provide basic job training for every employee, we could use advanced skills training as an incentive. Examples include project management, Black Belt training programme, etc.
2. Monetary Reward Practices These are typically related to pay or compensation issues. The use of monetary reward practices have a stronger motivational impact than the non-monetary rewards. However, they should be used in tandem with them. l (2a) Gain Sharing Portions of Six Sigma project gains in productivity, quality, cost effectiveness and so on, are shared with employees in the form of bonuses based on a pre-determined formula.
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l (2b) Profit Sharing Here the organization shares some portion of corporate profits with employees. A quality cost model or quality P&L (profit and loss) is often used here to measure this. l (2c) Variable Pay Here the compensation is a combination of a guaranteed and a variable component. The variable component is tied to an individual’s goal sheets (which compulsorily has quality related goals). The amount of variable pay depends on the individual’s achievement of agreed Six Sigma goals.
Whatever R&R programme you select, you need to remember the following do’s and don’t’s: · Keep the distinction between recognition and incentives clear. · Keep the recognition criteria wide open. · Nominations should be open to all employees. · Maintain confidentiality during investigations. · An R&R celebration should be done right. Whatever reward system you design, it should fit with the fabric of the organization’s culture. Sometimes it is seen that high productivity might be rewarded when increased quality is desired. Executives may receive personal rewards for their team’s efforts without having any proper recognition for the team. Remember, team awards are the best for organization-wide Six 212
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Sigma deployment. However, outstanding contributions must also be noted. The award system must be tailored to meet the organization’s needs and requirements. Six Sigma Takeaway Effective Rewards and recognition mechanism act as propellants in Six Sigma deployment.
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Lesson 66 Remember to work on mistake-proofing when implementing Six Sigma solutions
The solutions of a Six Sigma project would be incomplete if your system does not have controls or features in the product or process that prevents the occurrence of errors. It should have a system for organizing work that prevents errors even by a novice, allows everyone to operate without mistakes and prevents errors that are about to occur. This is called ‘mistake proofing’ or ‘fail safing’ or ‘poka yoke’ (Japanese usage, which when translated into English means ‘to avoid inadvertent mistakes’) which is an integral part of making products or services. The objective of mistake proofing is therefore to create an organized work environment that offers no opportunity for inattention and errors to occur and thus prevents any quality, quantity or delay defects. The mistake proofing methods are generally simple and are ways in which to help achieve zero defects. You do not require an expert in your workplace to implement 214
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‘mistake proofing’. Anyone, from a manager to the line supervisor and the line workmen can develop a poka yoke. All that is required is an involved and empowered workforce or process team members who realize its importance and are given a little instruction on what makes a good poka yoke. A motivated and empowered workforce or process team members can flood you with ideas for mistake proofing. The challenge before Six Sigma teams is to promote and implement poka yokes. The Six Sigma team should involve all those working on the process to facilitate a session to excavate potential poka yokes. All that is required is an effective facilitation by the project team leader or the process owner. There are guidelines for mistake proofing which one could use:
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Thoroughness and familiarity with problems in your workplace is essential. Train and acquaint people close to the process (including workmen) on problems caused by inattention. Remember, just by reminding people one cannot correct inattention to errors. Encourage discussion on ideas proposed for ‘mistake proofing’. There should be a disciplined follow-up on ideas proposed for ‘mistake proofing’. This is to ensure complete implementation. Encourage creativity to seek new ideas. Get ideas from other people.
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Poka yoke devices are of two types: 1. A prevention device where the process is engineered in such a way that it is impossible to make a mistake at all. An example of a prevention device is the cards used in ATMs of banks. You can never insert the card in a wrong fashion. 2. A detection device is where the user is informed when a mistake has been made, so that the user can quickly correct the problem. Detection devices typically warn the user of a problem, but they do not enforce the correction. Poka yokes should be an integral part of solutions recommended by Six Sigma projects. They tell you that either a process needs to be controlled so that a defect doesn’t occur or warn you that a defect is about to occur. Six Sigma Takeaway Poka yoke devices are placed close to where the mistakes occur so that quick feedback can be provided to the operators so that mistakes can be corrected.
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Lesson 67 Be ruthless if Six Sigma objectives are not met
As you set out on a Six Sigma implementation it is important that the CEO and senior management consistently demand solid performance on the Six Sigma objectives from business units or departments. Good performers should be rewarded while those who have not done well should be penalized. When teams are not able to deliver on the committed Six Sigma objectives, the leaders should come down heavily on them. Remember, if leaders take a lenient look at the achievement of the objectives, Six Sigma implementation will fail. I am aware of an organization which set out on a company-wide Six Sigma implementation across its various business units. At the beginning of the year, all units agreed and committed to ambitious Six Sigma targets. It was observed that the intensity of Six Sigma implementation was not same all across. In business units where the Business Head was demanding and ruthless on Six Sigma delivery targets, the implementation was deep and wide. In business groups where the DEBASHIS SARKAR
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Business Leader had backed away from accountability, Six Sigma implementation was weak despite having a great team. When it comes to Six Sigma implementation, do not expect anything less than the best performance from teams. If you think that you should let off people easily, if performance is not up to the mark as it is the first year, you are wrong. If you feel that Six Sigma requires harmony and hence you should not be demanding, you are wrong. If your assumption is that you will create discontentment amongst your people if you take a tough stand regarding meeting of Six Sigma targets as employees are overburdened, you are wrong. Well, these are nothing but recipes for a failed Six Sigma implementation. So as a leader, the following guidelines may prove to be useful: l l
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Continually enforce the Six Sigma targets. Reward people for performance and be ruthless when people do not meet their Six Sigma targets. As a CEO, set out ambitious targets for the entire company and integrate the entire organization through the shared vision. Sell the vision to the employees and describe the target in terms of organization’s and their own potential for success. Once the organization-wide targets have been set, seek inputs from employees on how to achieve it.
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Six Sigma targets should have a sufficient stretch. Constantly give feedback on performance. Tell members bluntly if they have not done well or have failed. Take hard decisions if teams do not perform with a sense of commitment. Strip poor performers of their Six Sigma responsibilities. Put the best people on Six Sigma projects and make it compulsory that they get associated with Six Sigma work before talking a leadership position.
As the CEO or a member of the senior management team it is your duty to ensure that Six Sigma gets deployed through the passion of employees while they feel satisfied and proud of their achievements. If you feel that by taking a tough stand on under-performance you will be rubbing the Six Sigma teams on the wrong side, you are incorrect. All that you are communicating is that Six Sigma is not important for you and that you do not have the guts to take hard decisions. Remember, reward the performers and penalize the underperformers. Six Sigma Takeaway Do not dilute implementation by going soft on under-performance of committed Six Sigma targets.
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Lesson 68 In case control charts are not being used by process team members, replace it with precontrol charts
One of the tools to keep the process in track once improvements have happened is through the usage of control charts. The control charts are used to establish an ongoing method of monitoring process performance. These charts help in quick detection of abnormal variations in a process. While there is nothing wrong with these charts, they are often not used because of their cumbersome nature. Once the Six Sigma projects get over, they are plotted for some time and then people discontinue using it. Thus, as a suggestion, replace control charts with precontrol charts. The pre-control charts are much simpler and extremely powerful in detecting abnormal variations in a process. They have all the advantages of control charts while being very user friendly. Founded by Frank Scatherwaite in 1950s, the power of this tool has not been leveraged to the fullest. The mechanics of 220
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the pre-control charts are so simple so that it can be taught to even illiterate workmen who can complete it in less than ten minutes. Let me give you the highlights of the pre-control charts: l l
Pre-control charts do not require data to follow a normal distribution. Draw two pre-control lines in the middle half of the specification limit (for two-sided specifications). For a Two-sided Tolerance
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Actions are to be initiated when the following conditions exist: Condition Action l 2units in Green Zone Continue l 1 unit in Green and 1 unit in yellow zone Continue l 2 units in yellow zone Stop l 1 unit in red zone Stop
Similarly there are rules for pre-control charts with one–sided specifications. The objective of this book is not to give details about pre-control charts but to DEBASHIS SARKAR
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apprise that control charts are not the end of all monitoring process performance. Let me reiterate that there is nothing wrong in control charts except that it is quite cumbersome at times. Instead of letting control charts being a ritual which is not being used regularly, replace it with a pre-control chart which is simple and can be plotted by anyone without much discomfort. I have personally seen the power of pre-control charts in a shop-floor where it was used by workmen. For more details on pre-control charts please go through Keki Bothe’s book titled World Class Quality (published by AMA COM). Six Sigma Takeaway Pre-control charts do not require data to follow a normal distribution or have any assumption regarding shape or stability.
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Lesson 69 Six Sigma is not an off-the-shelf solution to organizational pains
Six Sigma is not an off-the-shelf solution which removes all organizational pains. It does not guarantee success and requires a whole lot of things which need to be done for its success. Remember, the success or failure of Six Sigma does not depend on the methodology but how it is implemented. It is important to know the recipes for its failure in a company. l l l l
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Six Sigma does not have the active support of the CEO and senior management. Six Sigma deployment does not have an effective strategy. Middle management does not have the buy-in. Six Sigma is treated as another of those quality initiatives or training programmes which arrive and disappear. Projects are not tied to business imperatives. DEBASHIS SARKAR
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Huge unmanageable projects are taken up which take more than 6–8 months to complete. Failure to recognize the need and importance of infrastructure. Trying to commence on a journey without the support of an internal or external person who knows the methodology well. Benefits and savings are never quantified. Members from the quality team are only deployed on Six Sigma projects. Projects are being done for the sake of it. Lack of the right guidance from the consultant during early days of implementation. Six Sigma project execution outsourced to an outside consultant. Support from the human resource department is either minimal or they are indifferent. Black Belt/Green Belt training programmes do not have the desired and relevant content. Cultural elements to implementation are not addressed at all. Focus of Six Sigma is only on cost reduction. The company does not have a consistent and systematic method to get in the voice of customers. Six Sigma implementation is not supported by a business process framework but leaders view it as a set of functions and silos. There is no mechanism of rewards and recognition to reinforce the desired behaviours. Failure to manage change. LESSONS IN SIX SIGMA
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Management is not actively involved in Six Sigma but is merely committed to the allocation of resources. Six Sigma initiative is seen as a series of projects instead of focusing on process management and installing rigour and discipline in all processes. Process improvement is not considered to be a part of the job description. Organization believes that better quality comes about through more sophisticated statistics.
To summarize, Six Sigma improvement can be elucidated by the following equation: Right Tools + Right People + Right Processes + Management Commitment = Expected Results Six Sigma Takeaway Don’t think Six Sigma is an off-the-shelf solution, it requires a number of enablers and support system to make it successful.
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Lesson 70 Statistical thinking should be a way of life in a company working towards Six Sigma deployment
Why is statistical thinking important in an organization working on Six Sigma deployment? You could also be wondering as to why non-statisticians should bother about statistics. You may even suggest depending on Master Black Belts (MBB) and Black Belts (BB) to handle all the statistical elements of Six Sigma implementation. While every company should depend on BBs and MBBs who act as resources on statistical concepts, ‘statistical thinking’ is something that is more fundamental which everyone directly or indirectly involved with a Six Sigma journey should possess. It is both a competence and a mindset which should result in making ‘statistical thinking’ a way of life. But, what is statistical thinking? Statistical thinking is the process of using data to understand processes, problems and solutions. The core elements of statistical thinking are generation of data, 226
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extraction of relevant information from data, and utilization of information for optimal decision making. Thus, statistical thinking is well suited as a basis for continuous improvement of processes and products, or continuous quality improvement. It uses simple, mostly graphical, statistical tools. This enables the frontline staff to apply statistical thinking in everyday process management and improvement. Remember, statistical thinking is a philosophy of learning and action that is based on the principles that (1) all work can be regarded as a system of interconnected processes, (2) all processes exhibit variation, and (3) understanding and reduction of variation are keys to success. The primary benefit of statistical thinking is better quality at a lower cost. However, there are many other benefits: Internalization of the need for good data and measurements to make decisions; understanding and reduction of variability; stable and predictable processes; quantitative determination of process capability; identification of improvement opportunities; and a means of communication between operators, management, and support. Statistical thinking consists of five steps, each of them being totally dependent on the preceding step: 1. Collection of good data. 2. Visualization of the data. 3. Analyzing the data. 4. Making process stable and predictable. 5. Improvement of processes. Companies have to invest in training their employees (those who are not exposed to Green Belt/Black Belt training programme) on statistical concepts that will help in breeding statistical thinking. The purpose of statistical thinking and techniques is to make informed decisions. An informed decision is DEBASHIS SARKAR
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one that relies on good data, not hunches, engineering intuition, or data-less brainstorming. In your Six Sigma journey, you would make use of a number of statistical tools; and a foundation of statistical knowledge will not only help you to understand their basis but will also help you to use them properly. Remember, when statistical thinking becomes a way of life for employees, an excellent foundation for creation of Six Sigma change agents is being built. Six Sigma Takeaway Statistical thinking should be integral to companies traversing on a journey towards Six Sigma deployment.
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Lesson 71 Six Sigma project team leaders need to have focus, good relationships, communication skills, ingenuity and excellent project management skills to translate the charter into results
The Six Sigma project team leaders (Black Belts) have a huge responsibility of ensuring that projects are not only successful but are also completed on time. They should have good project management skills and work with team members and process stakeholders to achieve agreement and forward movement. The project leader also creates relationships, networks and mobilizes required resources to deliver project outcomes. Six Sigma project management is an integrative function— an action or failure in one end will have an impact on other project areas. The onus is on the project leader to integrate various management processes and interactions for effective project delivery. My recommendation is that Black Belt and Green Belts should be taken through a programme on project management to effectively apply skills and behaviours to improve DEBASHIS SARKAR
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project performance. This is in addition to the Black Belts’ or Green Belts’ class room sessions. The following is a list of project management competencies that Six Sigma leaders should possess in order to translate project goals to actions: l l l
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Exhibit a ‘can do’ attitude. Make all decisions in the interest of customers and stakeholders. Work well with other people and be considerate about his/her feelings with their views and opinions. Display a positive attitude towards team members, colleagues, management and stakeholders. Is viewed by others as being approachable and open. Accepts accountability, knows boundaries and displays ownership. Always participates in group discussions and meetings. Has the ability to defuse when necessary. Shows flexibility and adaptability to change where appropriate. Priorities through balancing commitments and priorities. Had the ability to handle stress and pressure. Able to communicate with people at all level. Has the ability to communicate effectively in writing and orally. Written communications are concise and easily understood. Can construct high quality reports and project documentation. LESSONS IN SIX SIGMA
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Shows leadership capabilities and leads by example. Uses appropriate coaching methods for training process team members. Promotes a ‘can-do’ attitude. Outline the roles and responsibilities of all team members. Develop contingency plan. Has the ability to inspire a shared vision. Commitment to and demonstration of ethical practices. Provides the substance that holds the team together in common purpose towards the objective. Has a hardy attitude and takes problems in strides. Demonstrates trust in others through actions. Able to challenge, inspire, enable, model and encourage. Delegates and demonstrates trust in others through actions.
Remember, you may be great in tools but lack of project management skills can mar the project. When you are just focusing on tools you are just dealing in quality management, but dimensions of cost, scope and time take you to the realm of project management. Six Sigma Takeaway Creating a challenging and meaningful project work environment for team members, is an important task of all Six Sigma project leaders. DEBASHIS SARKAR
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Lesson 72 Do not be complacent if processes have reached at Six Sigma levels
Often people wonder as to what happens if processes have reached Six Sigma levels. Well, first of all it is a tall order to reach Six Sigma levels in your processes. However, if processes have been delivering at Six Sigma levels do not be complacent. Ensure that this is sustained on an ongoing basis. Once the process performance is sustained, consider raising the quality bar. Benchmark with the best-in-class or the global best, and take it as the next performance goal. Technically speaking this would mean revisiting your specification limits and commencing on a journey towards achieving it. To me Six Sigma philosophy is about constantly moving the quality bar and working towards it. A Six Sigma organization is not just one which applies Six Sigma methodology but one that is fully and culturally Six Sigma. I personally believe that no matter how many times a process is improved, there will always be opportunities for improvement. You will also see that 232
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as processes are continually improved they become more flexible and amenable to improvement. So never be complacent, proactively look for opportunities for improvement. Beyond Six Sigma implementation, you could steer your organization towards business excellence. Your endeavour should be to enmesh various quality methodologies and install an integrated quality management system that moves your company towards business excellence. So before you claim that you have leveraged the complete power of Six Sigma, think twice. Institutionalising the Six Sigma approach takes time. Just do not consider it to be another process improvement methodology but a holistic model for changing the way the people in the company think. Involve every function cutting across hierarchies in the journey, comprising members from sales, production, distribution, marketing, purchase, finance, corporate planning and so on. Use the power to Six Sigma not just in process improvement but also in process management and process creation. And all these do not happen in a year. They require time and take years to seep within an organization. Do not get into the trap of looking for a new methodology without squeezing the best from Six Sigma. Six Sigma Takeaway Six Sigma philosophy is about constantly moving the quality bar and working towards it.
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Index
1.5 Sigma shift, 133–35 7 QC tools, 161 acceptability, 58 accommodation, 147 accomplishment, 16 accountability, 19, 218, 230 action, 101, 150–51 activity based costing method, 66, 108 adeptness, 38 agenda, 100 alignment workshop, 11 Allied Signal, 5, 91 Analysis of Variance (ANOVA), 40, 88 Analyze, 87 appraisal costs, 137 aptitude, 40 assertiveness, 146–47 assumptions, 70 assurance, 166 audio-visual material, 31 audit findings, 37 audits, auditors, 199, 201 automation, 60 award(s), 208–10; for maximum improvement, 209 awareness, 166, 185 234
background information, 100 bank, end-to-end process, 153–54 barriers to implementation, 32, 35 behaviour, 125, 192, 206, 229 behavioural skills, 52 benchmarking, 43 benefit package, 190 benefit tracking, 25 benefits, 30, 93–95 best business unit award, 210 billboards, 31 Black Belts (BBs), 15, 16, 19–20, 26, 29, 31, 36, 38, 39, 43, 53, 54, 56, 68–69, 70, 71, 94, 96, 101, 104, 112, 159–60, 161–64, 169, 171, 177–78, 183–85, 187, 188, 190, 191, 202, 203, 204, 210, 224, 226, 229–30 booklets, 30 Bossidy, Larry, 5 Bothe, Keki, 46, 222 bottom line, 2, 33, 91 bottom-up, 102 brainstorming, 107 Breakthrough Management Group (BMG), 162, 163 brochures, 30 Brown Bag, 203–5
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bulletin boards, 207 business, 1, 111 business case, 70, 86 business excellence, 233 business excellence models, 193, 195, 196 business goals, 62, 66, 69 business heads, 9, 11, 26, 217 business imperatives, 223 business improvement, 6, 30 business leader, 218 business objectives, 3, 90 business pains, 159 Business Process Management System (BPMS), 98 business results, 194, 195 business strategy, 4, 6 Business Unit Heads, 18 CEO award, 208 CII-Business Excellence Award, 193 calibration, 137 capability building, 26 career goals, 40 cash flow improvement, 92 certification, 16, 162 champions, 10, 15, 16, 17, 18–20, 36, 39, 41, 50, 52, 60, 71, 86, 94, 104, 107, 174 change, 14 change facilitators, 17 change management, 15, 43, 224 charts, 59 Chief Executive Officer (CEO), 5, 6, 18, 19, 56, 57, 114, 140, 159– 60, 178, 217, 218, 219, 223 Chief Financial Officer (CFO), 18, 92, 93–94
Chief Human Resource Officer, 18 Chief Process Facilitator (CPF), 171–73 Chief Risk Officer, 18 chronic issues, 1 class of the process, 82–85 coaching, 38, 39 commitment, 5, 28, 230, 231 communication, 26, 31, 40, 59, 94, 99, 166, 230 communication framework, 10 communication plan, 18 communication skills, 229–31 compensation, 190 competition, 66, 146–47 competitive information, 12 Complaints, 107 confidentiality, 63, 213 conflict avoidance, 147 conflict resolution, 146–47 conformance, 200 consequential metrics, 174, 176 consultant(s), consulting, 38, 39, 40, 46–48, 224; costs, 184; selection, 42–45 contests, 31 contingency plan, 231 continual improvement trajectory, 166, 167 continuous improvement, 13 Control, 89 control charts, 89, 198, 220–22 control plans, 43 cooperation, 146–47 core business processes, 62–64, 65–66, 69, 140, 165, 195 core team, 11 corporate planning, 233
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corrective actions, 12, 199, 201 cost(s), 44, 91, 103, 108, 183–84 cost avoidance, 2 cost effectiveness, 211 cost of product quality (COPQ), 108, 139 Cost of Quality, 108 cost reduction, saving, 58, 91, 156, 157, 186, 224 cost takeout projects, 156–57 courier company, end-to-end process, 155 creativity, 215 credentials, 43, 47 Critical to Quality (CTQ), 86, 124, 198–99 critique, 50 cross-functional movement, 191 cultural imperative, 6 culture building, 10 culture, cultural issues, 6, 13, 32, 34, 213 Customer, 107 customer(s), 1, 11, 12, 57, 64, 75– 78, 80, 87, 111, 112, 124, 149, 155, 153, 230 customer advisory panel, 77 customer complaints, 37 customer focus, 167, 194 customer interaction, 145 customer loyalty, 58 customer needs/expectations, 72, 117, 148–49, 155, 194 customer responsiveness, 4 customer retention, 2, 157 customer satisfaction, relationship, 2, 3, 4, 63, 66, 69, 79, 81, 92, 157 customer strategy, 195 236
customer waiting time, 181 cycle time reduction, 69 cynics, 9 Darling, Andersen, 203 Dashboard Manager, 27, 39, 59– 61 dashboards, 26–27, 59, 61, 94, 195 data, 104, 227–28 data collection mechanism, plan, 87, 89, 201 data distribution, 181–82 defect, 1, 86, 117, 118, 124, 148– 49 Defect Per Million Opportunities (DPMO), 117–22, 123–26 defects per unit (DPU), 130–31 defects reduction, 69 define, 86 deployment hierarchy, 16–17 deployment platoon for execution, 14–17 deployment strategy, 13 Design of Experiments (DOE), 40, 43, 47, 88 design failure, 138 designate, 210–11 detection device, 216 distribution, 233 DMAIC (Define–Measure–Anal y z e – I m p ro v e – C o n t ro l ) , model, 2, 13, 36, 86, 89, 110, 111 documentation, 201 documented quality systems, 165 downgrading, 138 DPMO, See Defect Per Million Opportunities drive, 33
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economic crisis, 4 effect, 21 effectiveness, 3, 8, 12, 49–51, 64, 67, 79, 80, 102, 198 efficacy of the process, 79–81, 202 efficiency, 12, 67, 79, 80, 81, 169 efficiency improvement, 157 electronic surveys, 76 Employee Field Reports, 77 employee(s), 145; involvement, 46–48 empowerment, 215 end-to-end projects, 57, 153 entitlement, 141, 142 escalations, 33 European Quality Award, 193 evaluation, 49–51 events, 31 excellence, 13, 63 execution, 6 exhibits, 31 expectations, 7 external consultants, 36, 177 External Failure Costs, 138–39 facilitation, 38, 39, 40, 172–73 facilitation skills, 161, 171 fail safing, 213 failure costs, 138 Failure Mode Effect Analysis (FMEA), 40, 54 feedback, 50, 191, 216, 219; from customer, 75, 76, 78 finance functions, 158 financial accountability, 2 First Pass Yield, 69, 127–28, 129 flexibility, 44 focus group activities, 107 focus group interviews, 77
formal presentations, 207 frustration, 151 functional boundaries, 40, 53 functional heads, 9, 11, 18, 26 fundamental pillars, 25–26 gain sharing, 211–12 Galvin, Bob, 5 General Electrics (GE), 5, 46, 90 global customer surveys, 75–76 goal statement, 70 goals, 3, 86, 173, 212; long-term, 194 Golden Peacock Award, 193 grandmasters, 17 graphs, 59 Green Belts (GBs), 16–17, 20, 26, 29, 31, 36, 39, 53, 54, 56, 68– 69, 70, 71, 96, 101, 112, 159– 60, 161–64, 171, 183, 184, 185, 187, 188, 190, 191, 202, 203, 204, 210, 224, 229–30 group discussions, 101 group process, 172 growth, 58 hard savings, 91–92 Harry, Mike, 46 Head of Quality, 112, 114 helpdesk, 25 helplessness, 151 high density poly ethylene (HDPE), 175 Honeywell, 91 hotel, opportunities of defect, 125 Hughes, Richard, 146 human resource(s) (HR), 158, 190–92, 207, 224
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human resource management, 194 Human Resource (HR) policy, 160 ice creams, manufacturing process, 22–23 Ideation, 107 implementation, 28, 32–34, 38, 42, 54, 56–58, 106, 189; monitoring, 24 implementation strategy, 88; assessment, 44 Improve, 88, improvements, 14, 19, 28, 33, 37, 52, 53, 188, 206, 232–33 improvement projects, 65–67, 79, 86, 153–55 incentives, 212 independent variable, 21 Indian Institutes Management (IIMs), 159 Indian Institutes Technology (IITs), 159 information, 227 information analysis, 194 information technology (IT) expert, 54, 71 infrastructure, 18, 27, 39, 109, 166, 224 infrastructure pillars, 24, 27 ingenuity, 229–31 initiative, 26, 28 innovation, 194 inputs (Xs), 23 inspection, 137–38 institutionalization, 46, 48 integration, 80 internal capability, 48 238
internal consultancy, 201 Internal Failure Costs, 138 internal-audits, 33 inter-personal skills, 40 invisible champion, 209 involvement, 97 ISO, 162 ISO 9000, 165 ISO 9001: 2000, 98 ISO 9001: 2000 certification, 165, 167 ISO implementation, 166 ISO preaching, 47 Jones, Daniel, 168–69 Kaizen, 169 key business processes, 62 Key Process Input Variables, 21 Key Process Output Variables, 21 knowledge management, 26, 194 Knowledge Management (KM) Framework, 186 lead time, shortening, 69 leader, leadership, 6, 17, 52, 144, 167, 191, 194, 219 leadership capabilities, skills, 52, 231 Leadership Council, 32 leadership training, 15 leaflets, 31 lean manufacturing, 168–69 lean six sigma, 168–70 lean thinking, 168–70 learning, 26, 88 long-term capability, 140–41 luncheon/dinner with MD/ Borad member, 209
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macro processes, 62 mail surveys, 76 Malcolm Badridge Award, 193 management, manager, 3, 50–51, 144, 199, 225 management confidence, 200 management process, 1 ‘management by remote control’, 144, 145 management review, 166 management trainees, 191 manual data presentation, 61 manufacturing, 3, 96 manufacturing organization, 138 market, marketing, 158, 233, 194 market conditions, 4 market focus, 194 market share, 63 marketing manager, 28–31 marketing skills, 29 Master Black Belts (MBBs), 15, 16, 25, 27, 36, 38–41, 95, 112, 161, 178, 182, 183–84, 189, 190, 204, 226 Measure, 87 measurement systems, 3, 10, 12, 39, 60, 79, 87, 117, 124, 167, 198, 196, 201 meeting(s), 25, 99–102; objectives, 100 memo, 99 mentoring, 38, 39 methodology, 36, 65 metric, 124 Minitab software, 10, 203 mission critical processes, 107 mission, 49, 62 mission-critical processes, 62 mistake proofing, 43, 89, 214–16
morale, 144 motivation, 215 Motorola, 5, 46 moving process, 116 Multiple Environment Over Stress Testing, 43 Multivariate Analysis, 43 networks, 229 new, declining and lost customer survey, 77 non-compliance, 201 non-normal data, 182 non-technical training programmes, 191 non-value added activities, 128, 129 nurture project sources, 26 objectives, 4, 6, 33, 49, 100, 217 operational pillars, 24–25 opportunities, 117, 125 organization, 37, 155–56 organizational assessment, 11, 13 organizational goals, 7, 63 organizational learning, 194 organizational objectives, 5, 12 organizational performance, 39 organizational quality objectives, 166 organizational resilience, 4 organizational strategy, 19, 49 organizational will, 197 Out of Control Action Points (OCAP), 199 outcome, 79, 81 outputs (Ys), 23, 79 ownership issues, 14
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package, 44 paid holiday, 209–10 paragons, 17 participation, 99–100 parts per million (ppm), 133–34 passion, 33 pay back, 90 people, 4, 196 performance, 74, 117, 123, 150, 174, 217, 219 performance assessment, measurements, 33, 97 performance scorecard, 195 performers, 159 personal interviews, 76 personal selling, 30 pictures, 59 planning, 172 Poisson Distribution method, 130 ‘poka yoke’, 214–16 population sampling, 116 positive attitude, 230 posters, 30 potential core processes, 63 potential problems, 152 power tools, 169 precision, 170 pre-conceived solutions, 187–89 pre-control charts, 220–22 precursors, 150–52 presentations, 31 prevention costs, 137 prevention device, 216 price, 75 primary metrics, 174–76 probability density, 130 problem(s), 226; identification, 151–52; root causes, 88 240
problem solving methodology, tools, 1, 13, 47, 161 problem statement, 70, 72–74, 86 procedure, 200 process, processes, 1, 4, 12, 65– 66, 74, 79–82, 108, 111, 122, 136, 155, 124, 182, 196–99, 214–16, 226, 227, 232–33; interconnected, 227 process audits, 26 process capability, 10, 88, 140–42 process control system, plan, 89, 197, 199 process council, 26, 34, 188 process deficiencies, 201 process documentation, 197 process expert, 53–54 Process-Grid, 82 process improvement, 1, 12, 175, 193, 194–95, 225, 233 process mapping, 54, 86, 87, 88 process metrics, 59, 61 process operators, 53 process owners, ownership, 11, 33, 53, 66, 71, 98, 174, 197, 201 process parameters, 97 process performance, 69, 232 process predictors, 21 process sampling, 116 process team, 220–22 process time, 169 production, 233 productivity, 169 productivity improvement, 2, 157 products, 148, 199 Profit Center Heads, 18 profit centers, 11 profit sharing, 212
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Project, 107 project(s), 3, 40, 39, 49, 57, 95, 223 project charter, 70–71, 86, 90 project cycle, 94 project deployment cost, 103 project documentation, 230 Project execution, 53, 93 project goals, 50, 173 project leaders, 16, 229–31 project limits, 103 project management, 2, 10, 229– 31 project management framework, 89 project management skills, 231 project milestones, 71 project scope, 70 project selection, 10, 42 project tracking mechanism, tracker, 18, 24, 185–86 promotional materials, 30 proofing measures, 89 prototype, 88 publications, 31 publicity, 207 purpose, 100 quality, quality issues, 2, 3, 6, 75, 97, 103, 158, 214, 232, 233 quality adulteration, 134 quality based promotions, 210 quality control, 137 quality costs, 33, 108, 136–39 Quality Council, 18, 27, 32–34, 42, 57, 188 quality culture, 166 quality frameworks, 14 Quality Function Deployment, 40, 43, 160, 204
quality improvement, 14, 106, 172 quality leaders, professionals, 1– 2, 11 Quality management, 137 Quality Management System Compliances, 37 Quality Management System, 114, 165–67 quality programme, 3 quality reviews, 37 quizzes, 31 Rajeev Gandhi National Quality Award, 193 rational sub-groups, 182 rationale, 5 references, 42–43 refreezing, 192 regression analysis, 88 regular reviews (timeline reviews), 35–36 relationships, 229–31 representative from CEO’s office, 54 reputation, 42–43 resistance to change, 15 resources, 7, 183 revenue generation, 2 revenue, 57, 91 review architecture, mechanism, 18, 25 review progress, 7 reviews, 10, 19, 25, 35–37, 166 rewards and recognition, 10, 12, 18, 25, 160, 185, 190, 206–13, 224; monetary, 211–13; by name, 210–11; non-monetary, 207–11
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rigour, 9, 13, 197 risks, 71 roles of people involved in Six Sigma, 24 Rolled Throughout Yields (RTY), 129–32 root cause analysis, 169 sales, 63, 158, 233 sales volumes, 92 sample size, 115 sampling, 116 sampling plan, 198 sampling strategy, 87, 115 savings potential, 178 savings, 93, 94 Scatherwaite, Frank, 220 scope, 104 scorecards, 195 secondary metrics, 174–76 self-discovery, 173 seminars, 31 senior management review, 26 senior management team, 7, 8– 10, 15, 27, 66, 90, 191, 179, 217 service effectiveness, 81 service organization, six sigma methodology, 96–98 services, 3, 96, 148 shareholders, 64 sharing, 147 shop floor, 144 short-term capability, 140, 141, 142 short-term paybacks, 91 Sigma levels, 82–85 Sigma trends, 201 Six Sigma, 1–3, 65–67, 90–91, 94, 96, 101, 112, 142–43, 153, 158, 242
159, 180, 181–82, 173, 193–96, 202, 203, 223–25 Six Sigma Academy, 17 Six Sigma advocates, 9 Six Sigma as a product to employees, 28–31 Six Sigma Awareness Workshops’, 30 Six Sigma Black Belt training, 179 Six Sigma Committee, 32 Six Sigma deployment, 10, 13, 25, 26, 30, 39, 42–45, 50, 56–58, 75–78, 90, 165, 177, 179, 183– 86, 191, 206, 214 Six Sigma implementation, 35, 217, 233 Six Sigma methodology, 6, 189, 195, 197–99, 202, 209 Six Sigma Plus, 91 Six Sigma project leader, 53 Six Sigma Project Management, 35 Six Sigma project, 19–20, 157 Six Sigma query meetings, 31 Six Sigma teams, 49–51; compositions, 52–55 skills, 40, 47, 172 soft savings, 91–92 solutions, 226 special causes, 141 sponsor, 52 stability, 222 staffing costs, 183 stakeholders, 57, 201, 230 standardization, 60 stand-up meetings, 36 statistical thinking, 226–28 statistical tools and concepts, 36, 40, 196
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statistician, 44, 182 statistics, 10 still population, 116 strategic objectives, 3, 36, 111 strategic planning, 194 strategy, 65, 223 sub groups, 181, 182 sub-processes, 62, 63 success stories, 10, 30 Suggestion Scheme, 108 suitability, 198 suppliers, 11, 12, 33, 87 supplier-vendor award, 209 supply chain, 69 symptoms of problems, 21, 150, 152, 189 synergy, 19 targets, 218 teaching, 38 team, 36, 171, 172, 192 team award, 208–9 team conflicts, 15 team dynamics, 52 team leaders, 43 team membership, 71 team process, 172 team product, 172 technical knowledge, 52 technical reviews, 36 telephone interview, 76 title, 211 tokens, 207–8 Tollgate Reviews, 36–37 top line, 1 top management, 19, 42, 59, 63, 92, 144, 159 Total Productive Maintenance (TPM), 143
Total Quality Management (TQM), 2, 47, 162 Toyota Production Systems, 168 training, 16, 39, 97, 178, 198 training and development, 12, 211 training costs, 184 training programme, 223 traits, 49–50 transactional surveys, 76 transition, 111 trust, 231 turn around time, 181 under-performance, 219 rewards, 219 ‘Unit’, 117, 118 unmanageble projects, 224 value, 56–58 value engineering, 43 values and attributes, 80 variability, 227 variable pay, 212–13 variation, 1 videotapes, 31 vision, 6, 32, 33, 62, 218 visualization, 227 volume, 56–58 ‘warusa kagen’, 151 waste elimination (non-value added activities), 168 waste reduction, 67 Welch, Jack, 5 what-can-go-wrong analysis,176 white belts, 17
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Womack, James, 168–69 word-of-mouth referral channels, 30 workforce, 215 workplace, 144, 169 World Class Quality, by Keki Bothe, 222
Xs, 87, 198; critical, 22, 23; controllable and uncontrollable, 22 yellow belts, 17 yields, 87, 127–28, 130 zero-sum strategy, 147
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