Six Sigma: A Global Tool for Product and Service Perfection - Coursework Example

Six Sigma: A Global Tool for Product and Service Perfection Introduction Due to rapid globalization and instantaneous access to information, productsand services call for to continuous improvement in order to meet ever changing business expectations. The competitive environment of the present day leaves no room for error and new approaches to go beyond customer and partner expectations must be relentlessly explored. For this reason, Six Sigma Excellence has become an integral part of the industry. Six Sigma is a highly regimented process that converges on developing and delivering products and services that are claimed to be close to perfection (Petrochemical Industries Co 2008). Six Sigma - Defined Six Sigma is a business philosophy which centers on continuous development (NC State University 2003). It is also a management strategy concept that establishes a paradigm of maximum discipline in order to achieve exceptionally high objectives, gathering data and, finally, evaluating results to nearly zero-degree of error forbearance. This serves as a device to trim down waste, defects and irregularities in both products and services (World Class Manufacturing 2008). The basis of Six Sigma is founded on the statistical compute of variability or defects of a process (Six Sigma Consultants Inc 2008). It is tagged as the “six standard deviations from the mean.” That explains the usage of the Greek letter sigma (Σ) which is a statistical symbolism that alludes to the disparity from a standard that was previously set. Said to be virtually defect-free, a Six Sigma process for a particular service or manufacturing environment cannot exceed to two (2) defects per billion parts produced (NC State University, World Class Manufacturing 2003). While nearly all companies operate a lenient line of 6,000 defects per million operations of a process, Six Sigma tolerates no more than 3.4 defects in a million operations of a process (NC State University 2003). In line with this, Six Sigma can only be considered achieved given that defects are kept at bay to a close to perfection production rate equivalent to 99.9997%. Consequently, the failure rate of 3.4 parts per million, though generally used, is already an unimaginable figure. The reason for this is that, is that in reality, the said failure rate is equivalent to a rough estimate of 4.5 sigma (World Class Manufacturing 2008). In a nutshell, Six Sigma is a ground-breaking business process striving for the dramatic reduction of organizational inefficiencies that eventually translates into revenue and profitability (Six Sigma Consultants Inc 2008). Six Sigma – History It all began in the 1980s when Motorola, Inc. embarked on reducing the number of its own production defects by means of procedures that lead to reduction of waste, improvement of quality, maximum utilization of production time and costs, and concentration on product design and manufacturing. Such proactive initiative applied the use of exact measurements to foresee possible problem areas (NC State University 2003). During the early and mid-1980s, Motorola engineers, piloted by Chairman Bob Galvin, came to a decision that the traditional procedure of measuring defects in one-to-thousands ratio did not provide the appropriate granularity. With the desire to measure the defects per million ratios, these engineers came up with this new standard and formulated the methodology and the required cultural change associated with it. The Six Sigma theory made Chairman Galvin and his crews comprehend powerful sine qua non results in their organization. As recorded, the company saved more than $16 Billion as a result of their Six Sigma efforts. It was from this first win that Six Sigma was eventually developed through another Motorola engineer named Bill Smith when he demonstrated the correlation of the frequency of repair a product undergoes at the time of manufacturing and its lifespan in 1985. Subsequently, the nickname "Six Sigma" is a trademark of Motorola via federal registration (iSixSigma 2008). In 1988, Motorola and the Westinghouse Commercial Nuclear Fuel Division (WCNFD) were awarded with the Malcolm Baldrige National Quality Award. With Total Customer Satisfaction (TCS) in mind, both companies had commenced on Continuous Quality Improvement (CQI) programs since the early 1980s. While Motorola used Six Sigma quality and Cycle Time reduction, WCNFD used the Cycle Time reduction since the 1970’s. As a result, Motorola acquired an outstanding market position in the wireless telecommunications industry—pagers and cell phones, whereas the WCNFD became a prominent figure in the nuclear fuel business (Brecker Associates Inc 2001; NC State University 2003). To be bestowed with this award, a company must first and foremost pass the core values and concepts governing it including the qualities of being customer-oriented, strong leadership ability, continuous development, esprit de corps, alertness, design quality, objective management, partnerships, and quantitative results (NC State University 2003). The Baldrige criteria do not impose or recommend to any company as to which specific quality improvement methodology to use. A company has the privilege to choose or develop its own improvement process; however the company has to present the obtained results. Apart from that, the Baldrige criteria evaluate a company in terms of the ability of all its personnel to effectively contribute in the said process expressed through teamwork and individual performance. This procedure is coined as Total Quality Management (TQM) which imparts a huge incentive to the problem-solving teams, quality improvement teams as well as the cross-functional teams. Generally speaking, companies train teams to apply clear-cut statistical quality tools when it comes to solving problems resulting to incredibly effective development and implementation of consensus-based solutions geared toward handling productivity and quality issues as it incorporates leadership, strategic planning, human resources and the process improvement. This can be seen in the Baldrige Award Framework below (Brecker Associates Inc. 2001). Due to lack of commitment to the certain improvement actions and to their operational implementation, most companies fail to achieve their goals through TQM. Six Sigma system prevail over such weakness by concentrating on the collective commitment to meet customer needs, establishing a consensus set of enhancement actions, giving importance to those actions and developing measures that guarantee accountability in the realization of the goals through the applied system (Brecker Associates Inc. 2001). As a consequence, the methodologies that the company applies to its production process were unleashed to their suppliers who were inspired to embrace the Six Sigma practices (NC State University 2003). Six Sigma – DMAIC Step The statistical tools of Six Sigma usually follow the DMAIC step—or the Define, Measure, Analyze, Implement and Control charts (World Class Manufacturing 2008). First of all, the company must DEFINE—recognize, prioritize, and choose the right project/s as well as the problem/s that is essential to quality. This is by far the most difficult part of the scheme. Secondly, the company must MEASURE all aspects of the process—the major product characteristics and process structure. Thirdly, it is important to ANALYZE the process determinants or factors that definitively affect performance. The fourth step is to IMPROVE by instituting optimum levels of performance for each determinant or factor. And, finally, outline a CONTROL plan to hold the gains. The DMAIC model provides a common language for Six Sigma projects. Company-wide implementation usually results in continual improvement, which leads to big cost savings. (NC State University 2003) Six Sigma Belts Highly trained key players are involved in the implementation of Six Sigma. These are players are categorized as the “Black Belts”, “Green Belts” and “Master Black Belt”. The “Green Belts” are people who are especially trained in the Six Sigma methodology and provide for assistance to the Black Belts in carrying out projects related to their own functional areas. Green Belts also lead one or more small projects each year. They are members of the process improvement action teams of the Six Sigma. People categorized as “Black Belts”, on the other hand, are technically-oriented personnel members of the leadership structure for the Six Sigma process improvement teams. These belters are of good reputation to be in charge of teams and give sound advice to management-level officers. They are offer full-time dedication to act as forerunners to major Six Sigma projects within the period of 18-24 months. They receive rigorous training and mentor Green Belts on the use of Six Sigma tools and methods. Then there are people who are labeled as “Master Black Belts” who act as the program managers or directors of the Six Sigma. They inspect and oversee process improvement projects. On certain event, they are required to train and provide support to Black Belts. They are in charged to pursue the success of every endeavor in relevance to customer satisfaction and other corporate goals. Also, Master Black Belt train other Six Sigma members and assist them in the achievement of Green and Black belt status. Lastly, the “Champions” are the people that comprise the high-level executives—not excluding VP’s or General Managers. They articulate the business case for the initiative and supply the resources as well as the inspiration required to maintain it (ProModel Corporation 2008; World Class Manufacturing 2008). Six Sigma Process Quality As mentioned earlier, Motorola engineer Bill Smith demonstrated the correlation between the rate of recurrence a product had to be repaired within the manufacturing process and during its lifespan. With a firm conviction in competing with the Japanese manufacturers, defect levels that were used to be measured in parts per hundred or in percentage (%) were started to be quantified in terms of parts per million (ppm). This is done for the purpose of improving the dependability of semiconductors and electronic products. Hence, that was the birth of the Motorola Six Sigma quality program with 3 ppm defects as its benchmark quality level (Brecker Associates Inc. 2001). There is a significant difference in the statistical methods employed in Six Sigma as compared to those employed in other mediocre engineering or statistics programs. Carrying out series of experimentations is not plainly an analysis of variance. It facilitates discernment of experimental outcome for statisticians; whereas it can become an obstruction to the planning and executing of experiments for engineers. On the other hand, observational methods and experimentation in the scientific context were equally emphasized in Six Sigma, for instance, two-level factorial testing is an orthodox and graphical methods are highlighted for the purpose of analysis of such tests (Ramberg 2000). Despite the fact that most quality of processes are already under control, significant source of problems have been removed in order to enhance the said quality of processes and the output usually pursues a Normal distribution classified as ± 3 sigma process capability. Every time a process is performed by different personnel in different conditions using different equipment and different materials, the process mean will change. The empirical variation in the process mean was ± 1.5 sigma. Eventually, Motorola resolved to a design tolerance or specification width of ± 6 sigma. This was considered necessary to be able to arrive at an allowable 3.4 ppm defects (Brecker Associates Inc. 2001). Using a one-sigma process can produce an outcome of 691462.5 defects per million opportunities. This is equivalent to a percentage output of only 30.854%. This is relatively considered as poor performance as compared to the outcome when functioning at a three-sigma level which could produce 66807.2% errors per million opportunities which can deliver up to 93.319% pleasing outputs (Six Sigma Consultants, Inc. 2-3). Six Sigma – Advantages & Disadvanages Although there are ample evidences that prove the effectiveness of Six Sigma, critics still abound. Undoubtedly there are pros and cons to any business idea (Ramberg 2000). Dr. Jiju Antony (in Ramberg 2000) discussed the advantages and disadvantages of Six Sigma strategy. On the brighter side of the process, Six Sigma places a fine focus on obtaining measurable and quantifiable financial revenues to the organization utilizing it. The strategy gives high regard on resilient and dedicated leadership in terms of the providing support which is a requisite for its successful implementation. The methodology it applies to the problem solving process involves the human elements which includes not only customer focus but also culture change and other factors. It also involves process elements such as process management, measurement system analysis, and statistical analysis, among others. In a considerable sequential and disciplined manner, it employs the different tools and techniques for solving problems in the business processes. Moreover, it calls attention to the significance of data as a basis for decision making instead of mere assumptions (Ramberg 2000). Despite this vast scope, Six Sigma also has its own limitations. The unavailability of data proves to be a challenge and occasionally takes the relative amount of the project time. The subjective judgment in decision making is terms of the selection and prioritization of projects is another critical factor in the successful implementation of a Six Sigma program. When it comes to meeting customers satisfaction, the statistical definition of Six Sigma which is 3.4 defects or failures per million opportunities sometimes becomes irrational as it tends to presuppose that all defects are similarly substandard as it could be an evident result of misdiagnosis, lack of training, misbehavior and many other human factors. In line with this, to some businesses, the standard assumption of 1.5 sigma shift for the different business processes is somewhat deemed illogical especially since a small shift in sigma could result to erroneous defect calculations. Problems also arise in the non-standardization procedures of the Six Sigma levels or belts in terms of certification process. According to studies there have been inconsistencies in the skills and expertise developed by Black belts or Green belts across companies. There are said to be instances when Black belts supposes they are already equipped with the knowledge of all the applied phases of advanced quality improvement methods when in reality they have scarcely touched the surface. Six Sigma can easily go off track into a routine exercise as it has an inclination to prioritize on the number of trained Black Belts and Green Belts, number of projects completed and other trivial issues. Ultimately, there had been an overselling of the Six Sigma strategy by too many consulting firms which, despite their claimed expertise in the said strategy, sometimes prove lack comprehension of the tools and techniques as well as the Six Sigma roadmap (Ramberg 2000). Six Sigma - Today Back to the time when Motorola initiated the Six Sigma philosophy, the proposal was harnessed to recurring manufacturing processes. This practice has progressed into a continuous and well thought-out process of enhancing all aspects of operations to steadfastly meet customer satisfaction in relevance to their products and services since Six Sigma is motivated by the consumer demands. The approach has promoted sleek, simple and the upright doing-it-right-the-first-time attitude which led to the realization of 50% reduction in process cost, developed cycle-time, waste reduction, amplified customer satisfaction and continued production quality (World Class Manufacturing 2008). Many present-day companies are remarkably accomplishing results through the company-wide implementation of the Six Sigma Improvement System. The number of technical personnel trained as "black belts" has increased in order to direct teams in the proper application of the statistically-based methodology (Brecker Associates, Inc. 2001). Conclusion The main concept of Six Sigma is the fact that the ability to measure or quantify the defects in a process would systematically lead to finding the solution to eliminate them and achieve a quality level of zero defects. The goal is to get the maximum efficiency of the Six Sigma which can be attained by implementing the system throughout the company, continuously training staff in the Six Sigma tools and methodology to oversee process improvement teams, and further sustain the exponential gains (Six Sigma Consultants, Inc. 2008). Six Sigma will be stay in the industry for as long as the projects generate measurable or quantifiable upshot results in terms of monetary or financial revenues. One of the real challenges of Six Sigma has to do with the competence of Black Belts who embark upon intricate organizational projects. It is not advisable to assuming that all Black Belts are uniformly equipped when in fact their capabilities vary a great deal across industries whether manufacturing or service oriented. Another peril is the attitude of most senior managers in the organizations who view Six Sigma as a cure all for their interminable problems (Ramberg 2000). References Ramberg, John S. 2000. Six Sigma: fad or fundamental? Quality Digest. http://www.qualitydigest.com/may00/html/sixsigmapro.html Performance leadership in meeting customer requirements by doing the right things right the first time. Brecker Associates, Inc. 2001. http://www.brecker.com/six_sigma.htm Six Sigma and Simulation – Complementary Solutions. ProModel Corporation. 1996-2008. http://www.promodel.com/challenge/sixsigma.asp The history of Six Sigma. iSixSigma Library. 2000-2008. http://www.isixsigma.com/library/content/c020815a.asp Understanding the six sigma principle. World Class Manufacturing. 2008 http://wcm.nu/sixsigma.html What is Six Sigma? NC State University. 2003. http://www.tx.ncsu.edu/sixsigma/whats_sixsigma/whatsixsigma.htm Why Six Sigma? Petrochemical Industries Company. 2008. http://www.pic.com.kw/six_sigma_why.asp Read More