Six Sigma

Ahsan Ahmad Baba

TOPICS

•SIX SIGMA

•TQM

•QUALITY CIRCLE

•DABAWALA CASE STUDY

What is six sigma..????

• SIX SIGMA IS A BUSINESS STATISTICAL STRATEGY.

• IS TO IDENTIFYING DEFECTS AND REMOVING THEM FROM THE PROCESS OF

PRODUCTS TO IMPROVE QUALITY.

• A DEFECT IS DEFINED AS ANY PROCESS OUTPUT THAT DOES NOT MEET

CUSTOMER SPECIFICATIONS.

• STATISTICAL MEASURE TO OBJECTIVELY EVALUATE PROCESSES.

History of six sigma

• THE SIX SIGMA WAS FOUNDED BY MOTOROLA IN THE 1970S.

• OUT OF SENIOR EXECUTIVE ART SUNDRY'S CRITICISM OF MOTOROLA’S BAD

QUALITY.

• THEY FOUNDED A CONNECTION BETWEEN INCREASES IN QUALITY AND

DECREASES IN COSTS OF PRODUCTION.

• BILL SMITH, “FATHER OF SIX SIGMA” INTRODUCE THIS QUALITY

IMPROVEMENT METHODOLOGY TO MOTOROLA.

SIX SIGMA METHODS

DMAIC

DMADV

Define Measure Analyze

Improve Control

Define Measure Analyze

Design Verify

DMAIC EXPLANATION• DEFINE : COMPANY MUST IDENTIFY THE CUSTOMER AND WHICH TYPE OF A

PRODUCT AND HOPE FROM IT. THESE ARE ANALYZE BY USING FLOW

CAUSE/EFFECT DIAGRAMS, CHECK SHEETS, PARETO ANALYSIS.

• MEASURE : COMPANY WILL COLLECT THE BASELINE DATA TO DETERMINE

WHERE THE PROCESS STANDS AS COMPARE TO WHERE IT NEEDS TO BE. AND

ALSO SEE THE CRITICAL TO QUALITY CHARACTERISTICS AN ESTIMATE CURRENT

PROCESS CAPABILITY. THEN FIND OUT THE CURRENT SIGMA LEVEL ACCORDING

TO THOSE IDENTIFIED CHARACTERISTIC THAT ARE MOSTLY IMPORTANT TO THE

CUSTOMER

ANALYZE : THIS SHOWS THE AMOUNT OF IMPROVEMENT NECESSARY TO MAKE

THE CRITICAL TO QUALITY CHARACTERISTICS THE BEST IN THE INDUSTRY. FOR

THIS PHASE COMPANY USE SOME DESCRIPTIVE STATISTICAL METHODS LIKE MEAN,

MODE, MEDIAN…ETC.

IMPROVE : IMPLEMENT THE SUGGESTED IMPROVEMENTS IN THIS PHASE ALSO

TEST POSSIBLE SOLUTIONS TO THE PROCESS PROBLEM. COLLECT DATA FROM THE

ALL POSSIBLE SOLUTIONS AND TEST THEM ON A SMALL SCALE AND RUN A

COST/BENEFIT ANALYSIS OF IMPLEMENTING THE SOLUTION. THEN CHOOSE THE

BEST SOLUTION AND CREATE A PLAN FOR IMPLEMENT THE SOLUTION.

DMADV EXPLANATION• THIS METHOD IS ALSO CALLED DFSS (DESIGN FOR SIX SIGMA)

AND HAVE FIVE PHASES,

• DEFINE: DESIGN GOALS THAT ARE CONSISTENT WITH CUSTOMER DEMANDS AND THE

ENTERPRISE STRATEGY.

• MEASURE :AND IDENTIFY CTQS (CHARACTERISTICS THAT

ARE CRITICAL TO QUALITY), PRODUCT CAPABILITIES, PRODUCTION PROCESS

CAPABILITY, AND RISKS.

• ANALYZE :TO DEVELOP AND DESIGN ALTERNATIVES, CREATE A HIGH-LEVEL DESIGN

AND EVALUATE DESIGN CAPABILITY TO SELECT THE BEST DESIGN.

• DESIGN :DETAILS, OPTIMIZE THE DESIGN, AND PLAN FOR DESIGN VERIFICATION.

THIS PHASE MAY REQUIRE SIMULATIONS.

• VERIFY: THE DESIGN, SET UP PILOT RUNS, IMPLEMENT THE PRODUCTION

PROCESS AND HAND IT OVER TO THE PROCESS OWNER(S).

WHY 6Σ: AN EXAMPLE !!

• CUSTOMERS WANT THEIR PIZZA DELIVERED FAST!

• GUARANTEE = “30 MINUTES OR LESS”

• WHAT IF WE MEASURED PERFORMANCE AND FOUND AN AVERAGE DELIVERY TIME OF 23.5 MINUTES?

– ON-TIME PERFORMANCE IS GREAT, RIGHT?

– OUR CUSTOMERS MUST BE HAPPY WITH US, RIGHT?

HOW OFTEN ARE WE DELIVERING ON TIME?

ANSWER: LOOK AT THE VARIATION!

• Managing by the average doesn’t tell the whole story. The average and the variation together show what’s happening.

s

x

30 min. or less

0 10 20 30 40 50

SIX SIGMA: ADVANTAGESigma level Defects Per Million Opportunities Rate of Improvement

1 690,000

2 308,000 2 times

3 66,800 5 times

4 6,210 11 times

5 230 27 times

6 3.4 68 times

WHAT IS TOTAL QUALITY MANAGEMENT ?• TQM IS AN APPROACH TO IMPROVING THE EFFECTIVENESS AND

FLEXIBILITIES OF BUSINESS AS A WHOLE. IT IS ESSENTIALLY A WAY

OF ORGANIZING AND INVOLVING THE WHOLE ORGANIZATION,

EVERY DEPARTMENT, EVERY ACTIVITY AND EVERY SINGLE PERSON

AT EVERY LEVEL. TQM ENSURES THAT THE MANAGEMENT ADOPTS

A STRATEGIC OVERVIEW OF THE QUALITY AND FOCUSES ON

PREVENTION RATHER THAN INSPECTION.

OBJECTIVES OF TQM• MEETING THE CUSTOMER'S REQUIREMENTS IS THE PRIMARY OBJECTIVE AND THE

KEY TO ORGANIZATIONAL SURVIVAL AND GROWTH.

• THE SECOND OBJECTIVE OF TQM IS CONTINUOUS IMPROVEMENT OF QUALITY. THE MANAGEMENT SHOULD STIMULATE THE EMPLOYEES IN BECOMING INCREASINGLY COMPETENT AND CREATIVE.

• THIRD, TQM AIMS AT DEVELOPING THE RELATIONSHIP OF OPENNESS AND TRUST AMONG THE EMPLOYEES AT ALL LEVELS IN THE ORGANISATION.

SIGNIFICANCE OF TQM

• THE IMPORTANCE OF TQM LIES IN THE FACT THAT IT ENCOURAGES INNOVATION,

MAKES THE ORGANIZATION ADAPTABLE TO CHANGE, MOTIVATES PEOPLE FOR

BETTER QUALITY, AND INTEGRATES THE BUSINESS ARISING OUT OF A COMMON

PURPOSE AND ALL THESE PROVIDE THE ORGANIZATION WITH A VALUABLE AND

DISTINCTIVE COMPETITIVE EDGE.

ELEMENTS OF TQM

• BE CUSTOMER FOCUSED

IT REQUIRES THE COMPANY TO CHECK CUSTOMERS' ATTITUDES REGULARLY

AND INCLUDES THE IDEA OF INTERNAL CUSTOMERS AS WELL AS EXTERNAL

ONES.

• DO IT RIGHT THE FIRST TIME

THIS MEANS AVOIDING REWORK, I.E., CUTTING THE AMOUNT OF DEFECTIVE

WORK.

• CONSTANTLY IMPROVE

CONTINUOUS IMPROVEMENT ALLOWS THE COMPANY GRADUALLY TO GETBETTER.

• QUALITY IS AN ATTITUDE

EVERY ONE HAS TO BE COMMITTED TO QUALITY. THAT MEANS CHANGINGTHE ATTITUDE OF THE ENTIRE WORKFORCE, AND ALTERING THE WAY THECOMPANY OPERATES.

• TELLING STAFF WHAT IS GOING ON

THIS INVOLVES IMPROVED COMMUNICATION. TYPICALLY, IT INCLUDES TEAMBRIEFING.

• EDUCATE AND TRAIN PEOPLE

AN UNSKILLED WORKFORCE MAKES MISTAKES. GIVING MORE SKILLS TOWORKERS MEANS THEY CAN DO A WIDER RANGE OF JOBS, AND DO THEMBETTER. IT ALSO MEANS EDUCATING STAFF IN THE PRINCIPLES OF TQM, WHICHIS A WHOLE NEW STYLE OF WORKING.

• MEASURE THE WORK.

MEASUREMENT ALLOWS THE COMPANY TO MAKE DECISIONS BASED ON FACTS,NOT OPINION. IT HELPS TO MAINTAIN STANDARDS AND KEEP PROCESSES WITHINTHE AGREED TOLERANCES.

• TOP MANAGEMENT MUST BE INVOLVED

IF SENIOR MANAGEMENT IS NOT INVOLVED, THE PROGRAMME WILL FAIL.

REASONS FOR FAILURE

• TOP MANAGEMENT SEES NO REASON FOR CHANGE.

• TOP MANAGEMENT IS NOT CONCERNED FOR ITS STAFF.

• TOP MANAGEMENT IS NOT COMMITTED TO THE TQM PROGRAMME.

• THE COMPANY LOSES INTEREST IN THE PROGRAMME AFTER SIX MONTHS.

DABBA WALA CASE STUDY

WHAT IS NMTBSA?

(NUTAN MUMBAI TIFFIN BOX SUPPLIERS ASSOCIATION)

HISTORY : STARTED IN 1880

CHARITABLE TRUST : REGISTERED IN 1956

AVG. LITERACY RATE : 8TH GRADE SCHOOLING

TOTAL AREA COVERAGE : 60 KMS

EMPLOYEE STRENGTH :5000

NUMBER OF TIFFIN'S : 2,00,000 TIFFIN BOXES I.E 4,00,000 TRANSACTIONS EVERY DAY.

TIME TAKEN : 3 HRS

WORKING OF NMTBSAERROR RATE : 1 IN 16 MILLION TRANSACTIONS

•SIX SIGMA PERFORMANCE (99.999999)

•TECHNOLOGICAL BACKUP : NIL.

•COST OF SERVICE -RS. 300/MONTH ($ 6.00/MONTH)

•STANDARD PRICE FOR ALL (WEIGHT, DISTANCE, SPACE)

•RS. 36 CR. TURNOVER APPROX. [6000*12*5000=360000000 I.E RS. 36 CRORE P.A.]

•“NO STRIKE” RECORD AS EACH ONE A SHARE HOLDER •EARNINGS -5000 TO 6000

P.M.

•DIWALI BONUS: ONE MONTH’S FROM CUSTOMERS.

• ZERO % FUEL ZERO % INVESTMENT

• ZERO % MODERN TECHNOLOGY ZERO % DISPUTES

• 99.9999% PERFORMANCE100 % CUSTOMER SATISFACTION

CODING SYSTEM INITIAL CODING SYSTEM USED COLORED THREADS TO

MARK 7 ISLANDS

THEN UTILIZED THROWN AWAY COTTON WASTE FROM TAILORS

NOW USING COLOR MARKERS:

E :: CODE FOR DABBAWALA STREET

AT RESIDENTIAL STATION

VLP :: RESIDENTIAL STATION VILLE PARLE

3 :: CODE FOR DESTINATION STATION.

E.G :: CHURCH GATE

9 :: CODE FOR DABBAWALA AT DESTINATION.

EX :: EXPRESS TOWERS ( BUILDING NAME)

12 :: FLOOR NO. IN THE BUILDING.

ACHIEVEMENTS• WORLD RECORD IN BEST TIME MANAGEMENT.

• NAME IN “GUINESS BOOK OF WORLD RECORDS”.

• REGISTERED WITH RIPLEY'S “ BELIEVE IT OR NOT”.

• INVITED FOR MARRIAGE OF HON. PRINCE CHARLES OF

ENGLAND ON 9TH APRIL, 2005

• DOCUMENTARY CALLED “DABBAWALAS, MUMBAI'S UNIQUE

LUNCH SERVICE”

• BY TWO DUTCH FILMMAKERS IN 1998.

THANK YOU