What is Six Sigma
The Origin of Six Sigma
Six Sigma was developed by Bill Smith and Mikel Harry at Motorola in the late 80’s, but has roots stemming back to Deming and the principles of Zero Defects, Total Quality Management and Carl Frederick Gauss (1777-1855) who first introduced the concept of the normal curve. Over several years that followed the initiation of its efforts, Motorola achieved a 200 fold improvement in production quality from 4 Sigma to about 5.5 Sigma and saved a reported $2.2 billion in the process.
Six Sigma became well known after Jack Welch made it a central focus of his business strategy at General Electric in 1995 to drive growth and cost reduction and in GE’s 1999 annual report they attributed benefits of $2 billion net income to Six Sigma.
Since then, hundreds of companies around the world have adopted Six Sigma as a way of doing business.
Six Sigma is a compilation of statistical concepts and other tools and techniques put together in a systematic way to get results.
It is a method of improving quality by removing defects and their root causes in business process activities. It concentrates on those process outputs which are important to customers and translates these customer needs into measurable requirements, the so called CTQ’s (Critical To Quality) or the customer requirements.
An indicator for the CTQs is identified and a robust measurement system is established to obtain clear and precise data relating to the process. Once this is in place, improvement activity is planned to drive process behaviour to meet and exceed customer specifications.
A measure of process capability is calculated by identifying opportunities for defects in a given product or process. Six Sigma performance is equal to 3.4 Defect Per Million Opportunities or 99.99997% Efficiency.
Is this realistic! Consider this. A 99% level of efficiency would mean:
- 2,000 lost articles of mail per hour
- 5,000 incorrect surgical operations/week
- 2 short or long landing at most major airports each day
- No electricity for almost 7 hours each month
- Telephone would not work for 4 hours each month
- Unsafe drinking water for almost 15 minutes each day
- Your car wouldn’t run for about one hour each week.
Six Sigma is a benchmark quality level and not the aim.
An average company operating at around 3.5 Sigma will typically spend around 20 – 30% of its revenues resolving and fixing internally generated problems.
A Six Sigma service company’s Cost of Poor Quality is less than 5%.
What is your organisation’s Cost of Poor Quality?
Basic Six Sigma Tools
There are countless Six Sigma tools and techniques. We can mention SIPOC process mapping, Measurement System Analysis (MSA), Failure Mode Effects Analysis (FMEA), Capability Analysis, Mistake Proofing (Poka Yoka), Descriptive, Inferential and Correlational statistics to name a few.