Six Sigma
See How Pursuing Perfection Can Put Some Kick Into Quality
By Mary Louise Ray
While perfection is never possible, the pursuit of perfection can
have quite an impact on a manufacturer’s bottom line. That is the promise of Six
Sigma, a quality management program that seeks to drive down defect rates in the
manufacturing process.
Motorola, which credits Six Sigma with more than $16 billion in costs savings, developed
the Six Sigma methodology in the 1980s. Similarly, General Electric cites its implementation
of Six Sigma as being responsible for double-digit sales and profit growth. Despite
such success stories, adoption of Six Sigma has been confined primarily to large
manufacturers. But increased global competition and increased OEM supplier standards
has led small- and medium-sized manufacturers to embrace Six Sigma, as well.
In response to this need, Pennsylvania’s Industrial Resource Centers (IRCs) are
working with small and medium-sized manufacturers to train their employees on the
principles of Six Sigma, as well as to develop and implement Six Sigma programs
within their companies.
The quest for manufacturing nirvana – zero defects and on- time delivery
Six Sigma employs statistical analysis to quantitatively measure, identify and eliminate
process defects. While typically applied to manufacturing processes, Six Sigma is
also effective for analyzing other business activities, such as scheduling, shipping
and sales.
“Sigma” is the Greek letter ( ) used to symbolize standard deviation in statistics,
while “Six” identifies the number of variations (defects) from perfection per million
that are present in the process. To understand it better, consider the following:
- One Sigma = 698,000 defects per million opportunities (DPMO) – a 69 percent* defect
rate
- Two Sigma = 308,000 DPMO – a 31 percent defect rate
- Three Sigma = 66,800 DPMO – a seven percent defect rate
- Four Sigma = 6,210 DPMO – a 0.62 percent defect rate
- Five Sigma = 233 DPMO – a 0.02 percent defect rate
- Six Sigma = 3.4 DPMO – a 0.0003 percent defect rate
* Numerical values are rounded off.
If you produced 100,000 units of your product per year at the Three Sigma level,
the 7 percent defect rate would amount to approximately 7,000 defective units per
year. When evaluating the impact of that defect rate on your company’s bottom line,
you must factor not only the loss of the ability to sell 7,000 units, but also the
additional costs associated with the scrap and rework of the defective units.
Conventional wisdom says that most companies operate at Three or Four Sigma. Achieving
a Four Sigma defect rate means that your process yields a perfect product 99 percent
of the time. That may sound pretty good, but if you produce 100,000 units per year,
your process is yielding 1,000 defects annually. Also consider that if your manufacturing
process includes multiple steps, if you are achieving 99 percent success rate in
each step of the process, you no longer have a one percent defect rate. Perfection
is not realistically achievable, but Six Sigma allows manufacturers to develop processes
with outcomes approaching perfection.
Define, measure, analyze, improve and control
The Six Sigma methodology is based on a cyclical improvement process originally
defined by Motorola as define, measure, analyze, improve and control (DMAIC). While
various permutations of the process have been developed in the ensuing years by
other entities, Motorola’s DMAIC concept remains a mainstay of the Six Sigma process.
The five components that comprise DMAIC are:
Define the purpose and scope of the project
Variables to be defined at the inception of the project include identification
of the process that requires improvement (including mapping the process flow), the
expected performance level of the process, strategic business goals, customer requirements,
resource requirements and the project timeline.
Measure the performance of the current process
Before you can quantify process improve-ments, the current process must
first be measured to obtain a benchmark performance level. Measuring the current
performance levels requires data collection from many sources, as well as the identification
and/or development of metrics that will be used to measure the data. Any data that
may impact the quality of the process being evaluated is collected – the measurement
of this data aids in isolating variables that contribute to product defects.
Analyze opportunities for improvement
Quantitative data analysis allows you to identify the gaps in your manufacturing
process that result in the disparity between performance expectations and actual
performance levels. Statistical tools are used to both validate the causes of problems,
as well as evaluate various options for mitigating the problems. Software packages
offering statistical analysis tools can speed this process considerably, such as
MINITAB statistical and graphical analysis software with tools designed specifically
for Six Sigma and other quality improvement projects.
Improve process performance
This phase of the Six Sigma process is devoted to developing, testing and
implementing solutions that will improve process performance and reduce the identified
causes of defects. Alternate solutions are proposed and tested – for example, one
solution may result in zero defects, but add an unacceptable level of man hours
to the process, while another solution may add production costs that are unacceptable.
This phase yields test data that allows the business to quantify the impact of the
alternate solutions, which can then be measured against the various requirements
(such as customer needs, business strategies and productions costs) to determine
which solution delivers the optimal result. Once the optimal solution is determined,
the plan for integrating the solution into the process is developed and implemented.
This typically includes revising operating procedures and additional workforce training.
Control performance
Once you have implemented the solution, you need to make sure that the
improved process stays in place over time. This entails developing a plan for monitoring
the process and providing mechanisms for reinforcing the change, such as continued
staff training and incentives. An effective implementation and monitoring program
will not only prevent a recurrence of the original problem, but will also allow
for continuous improvement over time.
Learn from the master, Grasshopper
The Six Sigma training process borrows from the martial arts when identifying
an individual’s level of Six Sigma training and experience. Therefore, an individual
designated as a “green belt” has been trained in the DMAIC methodology and some
intermediate quality tools.
Green belts typically assist “black belts” in Six Sigma projects. Black belts have
more expertise in Six Sigma methodology, with training not only in DMAIC and intermediate
quality controls, but also a variety of statistical process control techniques.
To obtain black belt status, an individual must learn the Six Sigma methodology
and associated tools and techniques, as well as successfully develop and implement
a Six Sigma project.
“Master black belts” are individuals that have experience in developing and implementing
successful Six Sigma projects. While requirements may vary among certifying entities,
master black belts typically receive additional training in advanced statistical
tools, as well as additional training in business, team and leadership skills. Master
black belts frequently serve as mentors to black belts in training.
Some programs also include a “yellow belt” designation, which precedes the green
belt. Individuals who have achieved this status have been trained in the fundamentals
of Six Sigma and have a detailed understanding of their specific work processes.
Following the implementation of the Six Sigma program, yellow belts can control
and monitor their processes as part of the overall process improvement.
Gearing up for Six Sigma demand
As the demand for Six Sigma programs increases, many IRCs are beefing up
their Six Sigma training and consulting services. The Delaware Valley IRC (DVIRC)
in Philadelphia, for example, has added a master black belt to its staff, according
to Jeff Kopenitz, the DVIRC’s Director of Advanced Manufacturing.
“We have seen interest in Six Sigma heighten over the past 12 months.” He adds that
several client companies in the DVIRC region have recently requested proposals for
Six Sigma training, making it likely that “we are going to be pretty busy.”
The Pittsburgh-based Catalyst Connection IRC has also broadened its Six Sigma offerings.
According to the Tim Dean, Director of Marketing and Client Relations, prior to
2004 the IRC was “marketing courses as they came up – as clients expressed interest.”
Since August 2005, however, Catalyst Connection has developed a 12-month calendar
of Six Sigma courses, ranging from “Introduction to Six Sigma” to “Black Belt Certification
for Green Belts.” This schedule more than doubles the number of Six Sigma courses
offered by Catalyst Connection in the previous year. Catalyst Connection also offers
Six Sigma project management, facilitation and implementation.
Is your company ready for Six Sigma?
While large manufacturers have embraced Six Sigma, it has been slower to
penetrate medium- and small manufacturers. The reasons for the slow adoption may
be because of the costs associated with the time-intensive training or man hours
associated with developing, implementing and maintaining a Six Sigma project. According
to Joe Fao, Product Manager for Advanced Manufacturing, of the Industrial Modernization
Center (IMC) IRC in Williamsport, “Price is definitely an issue for them.”
Donald A. Olszewski, Program Director of the Northeastern Pennsylvania IRC (NEPIRC)
in Wilkes-Barre agrees. “Manufacturers have a hard time sending workers to black
belt training,” he says. When you add the cost of the training to the loss of work
hours by the employee in training (a typical black belt training program includes
four weeks of classroom time over a four-week period), some manufacturers are reticent
to make that investment. For that reason, NEPIRC is developing a green belt program,
which is less time intensive and costly than a black belt program, but can still
result in tangible real-world savings for the manufacturer.
“Catalyst Connection offers a rapid Six Sigma project implementation. For clients
who do not have the resources to develop their own green or black belts but want
Six Sigma results in a short period of time, we offer a highly-focused project approach
with targeted results in 90 days or fewer,” according to Tracy Alim, Director of
Six Sigma at Catalyst Connection.
Olszewski notes that Six Sigma is just one of several methodologies that manufacturers
can use to improve their process. “It should all come under one umbrella – continuous
improvement,” he says. Six Sigma is an advanced methodology that is useful, “when
you don’t know the source of the problem,” but adds, that in many cases, manufacturers
already know the source of a particular problem and they don’t require the advanced
statistics and tools of Six Sigma to correct it. Sometimes a simpler and less costly
solution, such as implementing Lean manufacturing principles, is the appropriate
approach. “Six Sigma is one of many tools available, sometimes it is the right tool,
sometimes it isn’t,” concludes Olszewski.
As the Six Sigma process spreads, however, the training process itself becomes a
commodity that is sensitive to supply and demand. For example, a large company that
implements a Six Sigma program can produce a lot of Black Belts within a particular
geographic area. Such is the case of the General Electric facility in Erie. According
to Howard Wilson, Applications Engineer, of the Erie-based Northwest Pennsylvania
IRC, “We have a town full of black belts.” As the number of people trained as Master
Black Belts increases, there will eventually be a corresponding increase in the
number of consultants available to provide training.
“Prices will probably come down for Six Sigma training,” predicts Fao, which would
then make Six Sigma training more financially viable for small- and medium-sized
manufacturers.
But even if Six Sigma costs come down, it doesn’t necessarily mean that manufacturers
should plunge into a Six Sigma training program.
Your company may need a Six Sigma program, but is your company ready for a Six Sigma
program? Fao says that before embarking on Six Sigma, companies should first learn
and implement Lean manufacturing principles.
Lean manufacturing programs seek to eliminate waste from the process, while Six
Sigma seeks to eliminate variation. With that definition in mind, it only makes
sense that before a Six Sigma program is considered, a company must have effectively
implemented a Lean manufacturing program. “I think the biggest mistake companies
make in [quality improvement] is failing to understand the difference between Lean
and Six Sigma,” says Fao.
Lean Six Sigma – A hybrid approach
Because a Lean manufacturing process is a prerequisite for a successful
Six Sigma program, many Six Sigma training providers now offer a hybrid program
– Lean Six Sigma. This program addresses both Lean process improvements and the
Six Sigma methodology.
According to Michael L. George, author of the book Lean Six Sigma: Combining Six
Sigma Quality with Lean Speed (McGraw-Hill, 2002), Lean Six Sigma is able to answer
questions that Six Sigma or Lean cannot answer alone:
- To which steps in the manufacturing process should you first apply process analysis
and improvement tools?
- In which order and to what degree should the analysis and tools be applied to the
manufacturing process?
- How do you get the largest cost, quality and lead-time improvements in the shortest
amount of time?
As in the case of Six Sigma and Lean manufacturing, there is no organization that
controls the training curriculum or certification of Lean Six Sigma programs, so
training providers are free to customize the program according to the needs of the
particular company or group of students. In the case of the Manufacturers Resource
Center (MRC) IRC in Bethlehem, its Lean Six Sigma program is more heavily weighted
toward Lean manufacturing principles, as a stepping stone to green belt and black
belt training. Nonetheless, “It is not an either/or decision,” says Dick Donati,
Manufacturing Extension Manager at the MRC, when comparing Lean and Six Sigma. “It
is about the needs of the organization. We will use whatever is appropriate for
a particular company.”
The IMC and the Mantec IRC in York have joined forces to offer a Lean Six Sigma
training program, as well. This four-week course meets one week a month for four
months beginning in March 2006.
No matter where your company is on the continuum of quality improvement, the Pennsylvania
IRCs can provide advice, training and other resources to drive waste and variability
out of your production process – and increase your profits.