AnOverview NotalotofDetails 6 Overview SixSigma Ifwecan texpresswhatweknowintheformofnumbers wereallydon tknowmuchaboutit Ifwedon tknowmuchaboutit wecan tcontrolit Ifwecan tcontrolit weareatthemercyofchance MikelJ HarryPresident CEOSixSigmaAcademy Inc ARigorousMethodforMeasuring ControllingOurQuality willbringGEtoawholenewlevelofqualityinafractionofthetimeitwouldhavetakentoclimbthelearningcurveonourown JohnF Welch Jr 1995GEAnnualReport 6 Overview WhatDoes Sigma Mean SigmaisaMeasureoftheConsistencyofaProcess It isAlsothe18thLetterintheGreekAlphabet WhyDoesGENeedAQualityInitiative GERaisingTheBarNewGoaltobe BestintheWorld vs 1or 2CustomersareExpectingMore weMustDeliver Ship and fix ApproachnoLongerToleratedintheMarketAimtoSpeedPastTraditionalCompetitorsin5YearsGoalConsistentwithReducedTotalCostsWeMustAcknowledgeOurVulnerabilitiesPoorQualityThatImpactsCustomersProblemswithNPITooHighInternalCosts 6 Overview WeNeedaMajorInitiativetoMoveFromWhereweAretoWhereweWanttobe 6 Overview WhyDoesGENeedAQualityInitiative 40 35 30 25 20 10 15 5 CostofFailure ofSales DefectsperMillion 3 4 233 6210 66 807 308 537 500 000 Sigma 6 5 4 3 2 1 EstimatedCostofFailureinUSIndustryis15 ofSales TakingGEFroma3 toa6 CompanyWillSave 10 5BillionperYear Why SixSigma ProvenSuccessfulin Quality Demanding Industriese g Motorola TexasInstruments manyprocessstepsinseries ProvenMethodtoReduceCostsHighlyQuantitativeMethod ScienceandLogicInsteadofGutFeelIncludesManufacturing Service closetocustomer andProvidesBridgetoDesignforQualityConceptsHasSupportandCommitmentofTopManagement ItWorks 6 Overview 6 isSeveralOrdersofMagnitudeBetterThan3 Sigma AMeasureofQuality 6 Overview WhereDoes SixSigma ComeFrom MikelJ HarryoneoftheOriginalArchitectsPreviouslyHeadedQualityFunctionatABBandMotorolaNowPresident CEOofSixSigmaAcademyinPhoenix ArizonaHasConsultedforTexasInstruments AlliedSignal andothers CurrentlyRetainedbyGEtoTeachtheImplementation DeploymentandApplicationofSixSigmaConcepts Tools LearningfromThoseWhoHavehadSuccessWith6 WillAccelerateitsImplementationatGE 6 Overview So WhatisSixSigma THESIXSIGMABREAKTHROUGHSTRATEGY 6 Overview HowDoWeArriveatSigma Measuring EliminatingDefectsisthe Core ofSixSigma MeasurementSystem IdentifytheCTQs LookforDefectsinProductsorServices CriticaltoQuality CharacteristicsortheCustomerRequirementsforaProductorService CountDefectsorfailurestomeetCTQrequirementsinallprocesssteps DefineDefectOpportunities AnystepintheprocesswhereaDefectcouldoccurinaCTQ ArriveatDPMO UsetheSIGMATABLE ConvertDPMOtoSigma DefectsPerMillionOpportunities 23456 308 53766 8076 2102333 4 PPM DefectsperMillionofOpportunity SigmaLevel 6 Overview MeasurementSystem 23456 308 53766 8076 2102333 4 PPM SIGMALEVEL DEFECTSperMILLIONOPPORTUNITY IRSTaxAdvice BestCompanies AirlineSafety AverageCompany GE AverageCompanyin3 to4 Range SomeSigma Benchmarks 6 Overview MeasurementSystem AGraphic QuantitativePerspectiveonVariation AverageValue ManyDataSetsHaveaNormalorBellShape NumberofPeopleArrivingatCRD Time 7 00 7 15 7 30 7 45 8 00 8 15 8 30 8 45 9 00 9 15 6 Overview ProblemSolvingApproach 6 HelpsusIdentifyandReduceVARIATIONdueto InsufficientProcessCapability UnstableParts Materials InadequateDesignMargin Target USL LSL Target USL LSL Target USL LSL CenterProcess ReduceSpread Off Target Unpredictable On Target 6 Overview ProblemSolvingApproach LowerSpecificationLimit UpperSpecificationLimit LessVariationMeansFewerDefects HigherProcessYields 6 Overview ProblemSolvingApproach KeyComponentsof BREAKTHROUGHSTRATEGY IdentifyCTQ CTP CriticaltoProcess VariablesDoProcessMappingDevelopandValidateMeasurementSystems BenchmarkandBaselineProcessesCalculateYieldandSigmaTargetOpportunitiesandEstablishImprovementGoalsUseofParetoChart FishboneDiagrams UseDesignofExperimentsIsolatethe VitalFew fromthe TrivialMany SourcesofVariationTestforImprovementinCenteringUseofBrainstormingandActionWorkouts SetupControlMechanismsMonitorProcessVariationMaintain InControl ProcessesUseofControlChartsandProcedures AMixofConceptsandTools WillAlsoIntegratewithNPIProcess 6 Overview DisciplinedChangeProcess ANewSetofQUALITYMEASURES CustomerSatisfactionCostofPoorQualitySupplierQualityInternalPerformanceDesignforManufacturability WillApplytoManufacturing Non ManufacturingProcessesandbeTracked ReportedbyEachBusiness 6 Overview Structure 6 ProjectswiththeGEBusinesses TabulationofGESixSigmaResults BenefitTarget Update Currentbenefitslevel 10 865MM QPIDloading Carryoverfrom1999 4 059CompletedProjects2000 3 313ActiveProjects2000 3 285Total 10 865MM KeyConcepts Tools 6 Overview 6 Overview ChangingFocusFromOutputtoProcess IdentifyingandFixingRootCausesWillHelpusObtaintheDesiredOutput f X Y ProcessCapability 6 Overview SustainedCapabilityoftheProcess longterm USL T InherentCapabilityoftheProcess shortterm LSL Target OverTime a Typical ProcessWillShiftandDriftbyApproximately1 5 6 Overview ShortTermCentered versus LongTermShifted SixSigmaCentered LSL T ProcessCapability 001ppm 001ppm 6 LSL USL T 3 4ppm SixSigmaShifted1 5 Pro