Six Sigma & You

1SixSigma&YouRayStarkCorporateVP,QualityandSixSigma2PowerShift•ProductProliferation•SmallProductionRuns•ShortCycles•GlobalCompetition•ServiceCounts-ProductisaGiven•IntegratedDesign•FewParts•QualityDesigned-In•CreateMarketsChangingWorldRequiresNewSkills,Values,Tools•LimitedProductLine•LargeProductionRuns•ExtendedProductCycles•NorthAmericanCentric•ServiceasanAfterthought•Design,thenProduce•Non-StandardParts•InspectQuality•LatetoMarketFromTheProducer...ToTheCustomerMarketCharacteristicsManufacturingProcess3WhatIsSixSigma?2.03.4DefectsPerMillion308,500DefectsPerMillion•30%CostofPoorQuality•HighWarrantyCost•PoorDeliveries,HighInventories•Hard-To-BuildDesigns•Lessthan50%RolledThroughputYield6Past:ProducerModelFuture:CustomerModel•7%CostofPoorQuality•Agile&On-time,LowInventories•IntegratedwithCustomer&Supplier•FewFacilities,LowOverheads•99.9%+RolledThroughputYieldWellDevelopedTechnologies,SecretIsInExecutionSystematicidentification&eliminationofdefectsinallprocessesthroughtheuseofadvancedassessment&statisticaltools.4SuccessfulCompaniesRespondByFundamentallyChangingTheirApproach...TotalQualityCycleTimeReductionSupplierManagementProcessRe-EngineeringAdvancedTQAppliedStatisticsLeanManufacturingSupplyChainManagementHighPerformanceWorkOrganizationsPlantClosuresNewTools&ApproachesAlliedSignal:ALeaderInChange5TQ/SixSigmaHasBeenEmbracedAsTheChangeProcessBecauseItEmbodiesThreeFundamentalsOfAPremierCompany•Satisfyingcustomersasafirstpriority•Continuouslyimprovingallworkprocesses•HavinghighlymotivatedandinvolvedemployeesPeopleDrivingToPerfectProcessesDelightedCustomers6ProductivityGreatPeopleDrivingSixSigmaProcessesResultsPremierCompanyAlliedSignalVisionGrowth7GreatPeopleOurPeopleAreTheKeyToBeingPremier•KnowOurBusinessAndOurCustomers•OrganizedInNaturalWorkTeams•AccountableFor,AndCommittedTo,AchievingResults•EmpoweredToApplySixSigmaToolsToContinuouslyImprovePerformance8EmployeesManagingaProcess.•Dailyreviewofprocessperformance•Constantlyimprovingtheirprocesses•Empoweredtosatisfycustomers’requirementsEmployeesAccountableforaProcess.•Engageemployeesinobtainingunitresults•IndividualperformancebasedonteamperformanceHighPerformanceWorkTeams(HPWO)BuildingBlocksEmployeesOrganizedAroundProcesses.•Definebusinessprocesses•Alignemployeesaroundprocesses•BroadenjobscopeandresponsibilityEmployeesImprovingaProcess.•Employeeshavetoolstoimproveprocesses•Employeeshavetimetoutilizetools•EmployeeshaveresourcestohelpimplementtheirsuggestionsandideasEveryoneIsAProcessOwner...EveryoneIsInvolvedInContinuousImprovement9SixSigmaProcessesStrivingForPerfectionToDelightOurCustomers•Simplify--Lean•EliminateDefects•ReduceVariation•PerfectProcesses10IsA99%YieldGood?•Ifeachactivityhadayieldof99%,the“FirstTime,FirstQualityYield”wouldbeOnly86%Inotherwords,outof100outcomes:–14badparts–14wrongpaychecks–14customercallsnotreturnedActivityA100INPUTOUTPUT9999%AtFirstLook,ThisMightSeemOkay,butConsideraProcesswith15Activities:WastedTime,HigherCost&LowerCapacity,UnhappyCustomersA3.85SigmaProcessABCD...1008611WhereCanWeApplySixSigmaTools?TargetKeyBusinessAreasToMaximizeBenefitProcurementCycleProductionCycleReplenishmentCycleCustomerOrderCycleSalesCycleProductDevelopmentCycleEnablingProcesses(Finance,HR,IS,etc.)AlliedSignalBusinessProcessFramework•RequisitionToCheck•RequirementToProduct•RequirementToStock•OrderToCash•ContactToOrder•IdeaToProductWhereverDefectsOccur:12SixSigma=Reliability,CustomerSatisfaction&MarketShareHigherAuxiliaryPowerUnitReliability949596971,0002,0003,000919497•DesignOfExperiments•FailureModeandEffectAnalysis•ProcessMaps•LeanManufacturingTools:80%ImprovementInAverageTimeBetweenRemovalsImprovedSparesFillRate&Inventory92%FillRateFasterRepairTurnaround&HigherMarketShares29DaysTAT50%Share•RootCauseAnalysis•Teamwork•ProblemSolving•GoalDeployment77%37%49DaysImpactOnCustomerSatisfaction9495969796DaysofInventory150Days13SixSigmaProcessImprovementBroadeningSixSigmaApplicationsOrderPlacedToCashReceived•SalespersonMisquote,ErrorSalesAcquisitionOrderFulfillmentInvoicingAccountsReceivableDiscrepancyManagement•IncompleteShipment•IncorrectOrderFulfillment•InvoiceInaccuracy•InvoiceMissingData•Past-DueReceivables•MisappliedCash•MissingDocumentation1996199720%15%PastDueReceivables$65MCashFlowImpact•FocusOnEntireRevenueChain•MeasureDefects•Identify&FlagDefectiveInvoices•RootCauseAnalysis•MeasureResolutionCycleTime14WhereWeGoFromHere...•Results-Sigma-Savings-Growth-CycleTime•DepthOfTalent•CommitmentOfEmployees•CustomerImpactLotsOfProgress,ButNeedToProliferateProgress:ToMoveToTheNextLevel:•BetterIntegration•AddressAllProcesses•BroadenTalent•CompletelyAlignedGoals•TighterLinksToCustomer•TighterLinksToSupplierBase15BecomingAPremierCompanyAlliedSignal-1998Goals•Drivegrowth•Improvecompetitivenessvialearning•Enhanceprocesses,productivityandcashflowviaSixSigmaCustomerDrivenGoals16GoalDeploymentBusinessObjectivesDetermineGoalDeploymentxxxxxxxxxxxxxxxxxxATop-Down/BottomsUpProcess...Bottom-upreviewTop-downdeployment171998GoalandObjectiveDeploymentCorporateGoalsSBESampleGoalsan