Transcript Chapter 9

Chapter 9
Six-Sigma Quality
McGraw-Hill/Irwin
©2011 The McGraw-Hill Companies, All Rights Reserved
Learning Objectives
 Understand total quality management.
 Describe how quality is measured and
be aware of the different dimensions of
quality.
 Explain the define, measure, analyze,
improve, and control (DMAIC) quality
improvement process.
 Understand what ISO certification
means.
 Explain Benchmarking
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Key Six Sigma Concepts
 Critical to quality: attributes most important
to the customer
 Defect: failing to deliver what customer wants
 Process capability: what your process can
deliver
 Variation: what customer sees and feels
 Stable operations: ensuring consistent,
predictable processes to improve what the
customer sees and feels
 Design for six-sigma: designing to meet
customer needs and process capability
LO 1
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Total Quality Management
(TQM)
 Total quality management:
managing the entire organization so
that it excels on all dimensions of
products and services that are
important to the customer
 Two fundamental operational goals:
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Careful design of the product or service
Ensuring that the organization’s systems can
consistently produce the design
LO 1
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Total Quality Management (TQM)
 The TQM culture follows the Deming
approach:
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Cultural environment for SPC
Training employees in the TQM concept
Problem solving
Design of experiments
 TQM is customer (external/internal) driven
 TQM is company-wide not QC departments
only
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Culture of TQM
 Participative management:
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Create proper cultural environment
Promote team concepts
Change of attitude (management and labor)
Company versus individual goals
Have a long-term focus
 TQM is based on an integrated whole
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All departments
All functions
All people in the company
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TQM Concepts
 Interest mostly due to:
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Consumer interest in quality—more for their
money
Foreign competition
The trade deficit
 The goal is customer satisfaction
 TQM integrates all function/processes
in the company
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Malcolm Baldridge National
Quality Award
 Established in 1987 by Department of
Commerce—national standard for
quality
 Goal is to help companies review and
structure their quality programs—
enable them compete
LO 1
 Has requirement that suppliers
demonstrate they are measuring and
documenting their quality practices
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The Quality Gurus
Compared
LO 1
9-9
The Quality Gurus
Compared Continued
LO 1
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Quality Specifications and
Quality Costs
 Design quality: inherent value of the
product in the marketplace
 Conformance quality: degree to which
the product or service design
specifications are met
 Quality at the source: the person who
does the work takes responsibility for
making sure it meets specifications
LO 1
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The Dimensions of Design
Quality
 Performance: primary product or service
characteristics
 Features: added touches, bells and
whistles, secondary characteristics
 Reliability/durability: consistency of
performance over time
 Serviceability: ease of repair
 Aesthetics: sensory characteristics
LO 2
 Perceived quality: past performance and
reputation
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Cost of Quality
 Basic cost assumptions
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Failures are caused
Prevention is cheaper
Performance can be measured
 Cost of quality
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Appraisal cost
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Prevention cost
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LO 2
Training of employees in quality
Quality planning activities
Internal failure cost
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Inspection & testing of purchased materials
Inspection & testing of products
Costs of scrap and rework
Costs of analyzing failures
External failure cost
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Costs of warrantees
Costs of liabilities
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Six-Sigma Quality
 Six-sigma is a philosophy and
methods used to eliminate defects
 Seeks to reduce variation in the
processes
 One metric is defects per million
opportunities (DPMO)
DPMO
Number of defects
1,000,000
Number of opportunities for errorper unit  Number of units
LO 2
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Six-Sigma Methodology
 Uses many of the same statistical tools
as other quality movements
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Used in a systematic project-oriented fashion
through define, measure, analyze, improve,
and control (DMAIC) cycle
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More detailed version of Deming PDCA cycle
 Continuous improvement: seeks
continual improvement in all aspects of
operations
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Also uses scientific method
LO 2
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Six Sigma Quality
X  12oz
  0.2oz
1 Sigma = 11.80  12.00  12.20
= 317,400/Million Rejects
2 Sigma = 11.60  12.00  12.40
= 45,400/Million Rejects
3 Sigma = 11.80  12.00  12.60
 1 Or 68.3%
 2 Or 95.5%
 3 Or 99.73%
= 2,700/Million Rejects (Normal)
6 Sigma = 99.99966% Accepted.
= 4 ppm ~ process std deviation no more than 1/12 of total
allowable spread
Strategy for Achieving 6-Sigma:
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Robust Design
Variability Reduction
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Six Sigma Quality
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DMAIC Methodology
 Define
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Identify customers and their priorities
Identify a project
Identify critical-to-quality characteristics
 Measure
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Determine how to measure the process
Identify key internal processes
 Analyze
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Determine most likely causes of defects
Understand why key defects are generated
LO 3
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DMAIC Methodology Continued
 Improve
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Identify means to remove causes of defects
Confirm the key variables
Identify the maximum acceptance ranges
Modify process to stay within acceptable
range
 Control
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Determine how to maintain improvements
Put tools in place to track key variables
LO 3
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DMAIC Example
 Suppose we are the maker of a 16 oz
brand of cereal. Consumer Reports has
just published an article that shows that
we frequently have less than 16 ounces
of cereal in a box.
 What should we do?
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Step 1 - Define
 What is the critical-to-quality (CTQ)
characteristic?
 The CTQ (critical-to-quality)
characteristic in this case is the weight
of the cereal in the box. Other CTQs
could be:
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Number of broken flakes/scoop
Raisins per scoop
Time to sogginess
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2 - Measure
 How would we measure to evaluate the
extent of the problem?
 What are acceptable limits on this
measure?
 Assume the government says we must
be within ± 5 percent of the weight
advertised on the box
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2 – Measure (continued)
 Then,
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Upper Tolerance Limit = 16 + .05(16) = 16.8
ounces
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Lower Tolerance Limit = 16 – .05(16) = 15.2
ounces
15.20  X  16.80
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We buy 1,000 boxes of cereal and find that they
weigh an average of 15.875 ounces with a
standard deviation of 0.529 ounces
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What percentage of boxes are outside the
tolerance limits?
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2 – Measure (continued)
Lower Tolerance
= 15.2
Process
Mean = 15.875
Std. Dev. =0.529
Upper Tolerance
= 16.8
What percentage of boxes are defective (i.e. less than 15.2 oz)?
From Appendix G, page 765, approximately 10%, of the boxes
have less than 15.2 oz of cereal in them!
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Step 3 - Analyze
 How can we improve the capability of
our cereal box filling process?
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Decrease Variation
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Center Process
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Increase Specifications
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Maintain machines
9-25
Step 4 – Improve
 How good is good enough?
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Better equipment
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Trained employees
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“Six Sigma” and beyond
 6 minimum from process center
to nearest specification
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Step 5 – Control
 Statistical Process Control (SPC)
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Use data from the actual process
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Estimate distributions
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Look at capability - is good quality possible
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Statistically monitor the process over time
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Analytical Tools for Six Sigma
and Continuous Improvement
 Flowcharts
 Run charts
 Pareto charts
 Checksheets
 Cause-and-effect diagrams
 Opportunity flow diagrams
LO 2
 Control charts
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Example: Flowchart
LO 2
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Example: Run Chart
LO 2
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Example: Pareto Chart
LO 2
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Example: Checksheet
LO 2
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Example: Cause-and-Effect
Diagram
LO 2
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Cause-and-Effect Chart for Flight
Departure Delay (Fishbone Chart)
Equipment
Other
Weather
Air traffic
Personnel
Aircraft late to gate
Late arrival
Gate occupied
Mechanical failures
Late pushback tug
Late baggage to aircraft
Late fuel
Late food service
Gate agents cannot process passengers quickly enough
Too few agents
Agents undertrained
Agents undermotivated
Agents arrive at gate late
Late cabin cleaners
Late or unavailable cabin crews
Late or unavailable cockpit crews
Delayed
Flight
Poor announcement of departures Departure
Weight and balance sheet late
Delayed checkin procedure
Confused seat selection
Passengers bypass checkin counter
Checking oversize baggage
Issuance of boarding pass
Acceptance of late passengers
Cutoff too close to departure time
Desire to protect late passengers
Desire to help company’s income
Poor gate locations
Material
Procedure
Courtesy: Fitzsimmons & Fitzsimmons:
Service Management, 6th Ed., McGraw-Hill, 2008.
9-34
Example: Opportunity Flow
Diagram
LO 2
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Example: Control Chart
LO 2
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Other Six Sigma Tools
 Failure mode and effect analysis
(DMEA): a structured approach to
identify, estimate, prioritize, and
evaluate risk of possible failures at each
stage in the process
 Design of experiments (DOE): a
statistical test to determine cause-andeffect relationships between process
variables and output
LO 3
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Six Sigma Roles and
Responsibilities
 Executive leaders must champion the
process of improvement
 Corporation-wide training in Six
Sigma concepts and tools
 Setting stretch objectives for
improvement
LO 3
 Continuous reinforcement and
rewards
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Six Sigma Organization:
Roles & Responsibilities
Executive
Project Member
 Own vision, direction,
integration, results
 Lead change
Champion
 Project owner
 Implement solutions
 Black Belt managers
 Part-time
 Project-specific
All Employees
 Understand vision
 Apply concepts
Master
Black Belt
 Full time
 Train and coach Black/Green Belts
 Statistical problem solving experts
Courtesy: Fitzsimmons & Fitzsimmons:
Service Management, 6th Ed., McGraw-Hill, 2008.
Green Belts
 Part-time
 Help Black Belts
Black Belts
 Devote 50%-100% of time to Black Belt
activities
 Facilitate/practice problem solving
 Train and coach Green Belts/project teams
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Six-Sigma In Practice
100 Rounds of Golf a Year
 2  < 6 missed putts per round
 3  1 missed putt per round
 4  1 missed putt every 9th round
 5  1 missed putt in 2.33 years
 6  1 missed putt in 163 years
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The Shingo System: FailSafe Design
 Shingo’s argument:
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SQC methods do not prevent defects
Defects arise when people make errors
Defects can be prevented by providing
workers with feedback on errors
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Successive check
Self-check
Source inspection
 Poka-Yoke includes:
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LO 3
Checklists
Special tooling that prevents workers from
making errors
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ISO 9000 and ISO 14000
 Series of standards agreed upon by the
International Organization for
Standardization (ISO)
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LO 4
Adopted in 1987
More than 160 countries
 A prerequisite for global competition?
 ISO 9000 an international reference for
quality—”document what you do and do
as you documented”
 ISO 14000 is primarily concerned with
environmental management
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ISO 9000 Series
 Standards:
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9001: Model for Quality Assurance in Design,
Production Installation, and Servicing
9002: Model for Quality Assurance in Production and
Installation
9003: Model for Quality Assurance in Final Inspection
and Test
 Guidelines:
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9000: Quality Management and Quality Assurance
Standards: Guidelines for Selection and Use
9004: Quality Management and Quality Systems
Elements—Guidelines
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Three Forms of ISO
Certification
 First party: A firm audits itself
against ISO 9000 standards
 Second party: A customer audits
its supplier
 Third party: A "qualified" national
or international standards or
certifying agency serves as auditor
LO 4
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More About ISO 9000
 They are not award programs
 They just provide criteria for measuring
quality systems
 They are quite flexible
 Applies to all industries
 It is a worldwide standard
 Offers opportunity for global competition
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External Benchmarking
Steps
 Identify those processes needing
improvement
 Identify a firm that is the world
leader in performing the process
 Contact the managers of that
company and make a personal visit
to interview managers and workers
LO 4
 Analyze data
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Steps to Benchmarking
 Align benchmark goals to
organizational goals
 Develop methods of measuring
performance
 Undertake benchmark improvement
activities
 Measure performance
 Repeat the process and continue to
improve
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Benefits of Benchmarking
 Cultural change
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Allows firm to set realistic goals
Engenders cultural change: compare oneself
 Performance improvement
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Forces firm to define and identify gaps
Provides way for improvement
 Human resource benefits
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Recognizes the importance of people
Provides for training and make them part of
problem-solving process
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Pitfalls of Benchmarking
 It is not a panacea
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Will not work if the culture is lacking
Could be counterproductive
 Potential pitfalls
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Failure to involve/empower employees
Failure to define/understand own process first
Failure to take action on results
Failure to set realistic goals
9-49