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Click to edit Master title style,Click to edit Master text styles,Second level,Third level,Fourth level,Fifth level,*,*,*,QIA,Improve,Quality,Reduce,Cost,Productivity,Improves,Capture,Market,Provides,jobs and,more jobs,Models of the relationships affecting quality,and business performance,Demings Model:,less rework,less scrap,Increase cycle time,increase throughput,better quality,lower price,Overall,society,benefits,COST OF POOR QUALITY(COPQ),External Failure Costs,Warranty Adjustments,Repairs,Customer Service,Returned Goods,Returned Repaired Goods,Product Recalls,Product Liability Suits,Opportunity Costs,Internal Failure Costs,Scrap,Rework,RE-INSPECTION of Rework,Downgrading Because of Defects,Losses Caused by Vendor Scrap,Downtime Caused by Defects,Failure Analysis.,Appraisal Costs,Receiving Inspection,In-process Inspection,Laboratory Inspection,Outside Laboratory Endorsements,Setup for Testing,Maintenance of Test Equipment,Quality Audits,Calibration of Quality Equipment.,Prevention Costs,Quality Engineering,Design and Development of Quality Equipment,Design Verification and Review to Evaluate the Quality of New Products,Quality Training,Quality Improvement Projects,Quality Data Gathering Analysis and Reporting,Other Process Control Activities Used to Prevent Defects,Lost Opportunity,Scrap,Rework,Inspection,Warranty,Rejects,Lost sales,Late delivery,Engineering change orders,Long cycle times,Expediting costs,Excess inventory,The Cost of Poor Quality(COPQ)“Iceberg”,Traditional Quality Costs,Additional Costs of Poor Quality,(intangible),(tangible),4-8%,25-35%,(Easily Identified),(Difficult or impossible to measure),Lost Customer Loyalty,More Setups,Six Sigma Philosophy,We are in business to make money,We make money by satisfying needs,We are able to satisfy needs by doing,Every need/do pair is an interaction,The aim of customer focus is on improving need/do interaction,Repetition of the same action constitute a process,Improve our business means improvement of our processes,Customers need products/services on-time,with zero defects,with lower cost,As process capability improves,the product quality increases,As quality increases,costs and cycle-time go down.,The reduction of defects,cycle-time,cost leads to improved customer satisfaction,As customer satisfaction improves,the likelihood of doing business increases,As business increases,we(as individual and society)grow and prosper,What is Six Sigma?,Sigma is a statistical unit of measure which reflects process capability.The sigma scale of measure is perfectly correlated to such characteristics as defects-per-unit,parts per million defective(PPM),and a probability of a failure/error.,The sigma value indicates how often defects are likely to occur.The higher the sigma value,the less likely a process will produce defects.As sigma increases,costs go down,cycle time goes down,and customer satisfaction goes up.,What is the meaning of quality?,99%Good(3.8 Sigma),99.9997%Good(6 Sigma),20,000 lost articles of mail per hourSeven articles of mail lost per hour,Unsafe drinking water for almostOne unsafe minute every seven months 15 minutes each day,5,000 incorrect surgical operations 1.7 incorrect operations per week,per week,2 short or long landings at most majorone short or long landing every five,airports each dayyears at each airport,200,000 wrong drug prescriptions per year68 wrong drug prescriptions per year,No electricity for seven hours each monthOne hour without electricity every,34 years,Six Sigma Is.,Six Sigma is disciplined methodology for continuous improvement for,Reducing process variability and keeping it reduced,achieve benefits from improvements in:,better product/process quality,reduce scarp and rework,reduce cycle time,better product/process design,reduce major expanses,A tool set to make that change practical,Empowered people have the control they need to improve the way they work,A common language for discussing,measuring and comparing process capabilities,A powerful competitive advantage.,-6,-5 -4 -3 -2 -1,X +1,+2 +3 +4 +5 +6,Normal Distribution,Shifted 1.5,Process Capability(Sigma),PPM,Yield,2308,53769%,3 66,80793.3%,4 6,21099.3%,5 23399.98%,6 3.499.9997%,Sigma Measures-Process,Capability,Performance,Level,SIGMA,%Yield,#of Defects per,Million(DPM),A+,6,99.99966,3.4,A,5,99.9767,233,B,4,99.3790,6,210,C,3,93.3,66,807,D,2,69,308,537,F,1,31,691,462,Good,World-Class,Average,Good,World-Class,Average,Cost of,Quality%,1%of sales,5-15%of sales,15-25%of sales,25-40%of sales,C,93.3,66,807,3,Establish organizational measurements,Identify the sigma level,Establish COPQ measurement process,Identify the major areas for improvement,3 to 4 sigma means 15%to 25%cost of sales:,-Which means if your sales is$100 millions,you can save up to$25 millions by implementing Six Sigma program.,The savings is continuous basis year over year,What is the Benefits of Six Sigma?,Output Measurement,Failure rate(internal and external),Warranty cost,Repair cost per unit,Cycle time per
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