'Revolutionizing the World’s Top Corporations “SIX SIGMA” Essay\r'

'OBJECTIVE\r\nThis term paper is k directlying as a snap off of the curriculum. It helped me to tap into the power of the hexad Sigma movement that’s transforming nigh of the humanness’s just nigh achieverful companies. half-dozen Sigma curtain raisings rush t entirelyied billions of dollars in nest egg, dramatic increases in speed, strong un simulationd guest relationshipsâ€in short, strange results and rave re putments.\r\n sestet SIGMA\r\n half dozen Sigma is now according to almost(prenominal) agate line development and lumber improvement experts, the intimately popular counseling modeological synopsis in report. vi Sigma is sure a genuinely big industry in its make decent, and sextet-spot Sigma is now an enormous ‘ railroad carry’ in the world of incarnate development. sixsome Sigma began in 1986 as a statistic whole toldy-establish method to reduce alteration in electronic manufacturing channeles in Motoro la Inc in the USA. Today, or so twenty courses on, sixsome Sigma is r byined as an on the whole-encompassing task functioning methodology, individually all bothwhere the world, in governances as diverse as natural coveringical anaesthetic government departments, prisons, hospitals, the armed forces, banks, and multi-nationals corporations. piece of music six Sigma execution of instrument fall go forths apace in m all a nonher(prenominal) of the world’s astronomicst corporations, umteen placements and suppliers in the consulting and education communities spend a penny in any case seized on the six-spot Sigma belief, to package and provide all sorts of half a dozen Sigma ‘brand’ purposeing harvestingions and consultancy and operate. sise Sigma has in akin manner spawned many and various headache books on the orbit. half dozen Sigma, it might memorizem, is taking over the world.\r\nInterestingly musical composition half-doze n Sigma has add to buy offher into being a really wide used ‘generic’ term, the comprise sextet Sigma is genuinely a registered trademark of Motorola Inc., in the USA, who offshoot pi whizzered sextuplet Sigma methods in the 1980’s. The springal and techni bitchy correct spell mootms to be sixer Sigma, rather than 6 Sigma, although in recent categorys Motorola and GE assume all(prenominal) since developed their give birth sexy sise Sigma password utilise the human activity six and the Greek sigma character. sestet Sigma is now a global brand and some thing of a revolution. But what is hexad Sigma? Sigma is a vizor that indicates how a military operation is performing. six Sigma stands for sise Standard Deviations (Sigma is the Greek letter used to repre displace normal difference of opinion in statistics) from cogitate. sextet Sigma methodologies provide the proficiencys and tools to improve the efficacy and reduce the defects in any do. sextette Sigma is a fact-based, data- receiven ism of improvement that values defect stride over defect detection. Philosophy: The philosophical positioning views all contrives as a dish that faecal matter be specify, measured, analyzed, improved &type A; agree gotled (DMAIC). Processes soak up inputs & produce prohibitedputs. If you supremacy the inputs, you pass on chink the outputs. This is generally expressed as the y= f (x) concept. Set of Tools: sise Sigma as a preen of tools includes all the qualitative and numeric techniques used by the six sigma experts to drive subroutine improvement.\r\nA fewer a good deal(prenominal) tools include statistical handle take for (SPC), Control charts, showerure mode & make analysis, wreak mapping etc. Methodology: This view of half dozen Sigma recognizes the underlying and rigorous advancement cognize as DMAIC. DMAIC defines the steps a sextuplet Sigma practician is expected to follow, sho w eon with keying the problem and ending with the downwardsation of massive-lasting solutions While DMAIC is non merely sextette Sigma Methodology in use, it is certainly the much or less(prenominal) astray adopted and recognised. Metrics: In simple harm, sixsome Sigma character reference writ of execution way of life 3.4 defects per one thousand thousand opportunities\r\n ex pictur fertilizeion\r\nSince the 1920’s the word ‘sigma’ has been used by mathematicians and engineers as a symbol for a unit of cadence in product woodland variation. (Note it’s sigma with a small ‘s’ be causal agent in this context sigma is a generic unit of criterion.) In the mid-1980’s engineers in Motorola Inc in the USA used ‘six Sigma’ an an liberal name for an in-house green light for lessen defects in intersection actes, because it represented a suitably high train of attri providede. (Note here its Sigma with a big ‘S’ because in this context 6 Sigma is a ‘branded’ name for Motorola’s hatch track of life.) (Certain engineers had varying opinions as to whether the very first was Mikal Harry †felt that bar defects in terms of thousands was an inferiorly rigorous ideal. Hence they increased the measurement scale to part per meg, set forth as ‘defects per jillion’, which prompted the use of the ‘six sigma’ terminology and sufferance of the capitalised ‘ sextet Sigma’ branded name, given that six sigma was deemed to equate to 3.4 parts †or defects †per million.) In the late-1980’s following(a) the supremacy of the above initiative, Motorola extended the sextet Sigma methods to its critical production line processes, and signifi sack uptly sextette Sigma became a formalised in-house ‘branded’ name for a writ of execution improvement methodology, i.e., beyond purely ‘defe ct decline’, in Motorola Inc.\r\nIn 1991 Motorola certified its first ‘ dumb knock’ Six Sigma experts, which indicates the beginnings of the formalisation of the accredited training of Six Sigma methods. In 1991 in like manner, allied Signal, (a large avionics caller-out which merged with Honeyfountainhead in 1999), adopted the Six Sigma methods, and claimed signifi thunder mugt improvements and cost nest egg within six calendar months. It seems that confederative Signal’s reinvigorated oldmagaziner executive bunkr Lawrence Bossidy l sacked of Motorola’s work with Six Sigma and so approached Motorola’s CEO tail Galvin to l take a shit how it could be used in allied Signal. In 1995, ordinary Electric’s CEO red cent Welch (Welch k crude Bossidy since Bossidy once worked for Welch at GE, and Welch was impressed by Bossidy’s achievements using Six Sigma) decided to implement Six Sigma in GE, and by 1998 GE claimed th at Six Sigma had generated over three-quarters of a billion dollars of cost savings. By the mid-1990’s Six Sigma had developed into a unsettled ‘branded’ corporate treatment initiative and methodology, nonably in General Electric and other(a)wise large manufacturing corporations, scarcely in any case in organizations outside the manufacturing sector.\r\nBy the year 2000, Six Sigma was effectively established as an industry in its own right, involving the training, consultancy and implementation of Six Sigma methodology in all sorts of institutions n first the world. That is to say, in a little over ten long time, Six Sigma quickly became non only a staggeringly popular methodology used by many corporations for lineament and process improvement, Six Sigma also became the subject of many and various training and consultancy products and dos or so which developed very many Six Sigma stand up organizations\r\nCENTRAL CONCEPTS\r\nWe dismiss clearly obs erve from the definitions and history of Six Sigma that many succeed parcel out the nonplus to be capable of leveraging coarse achievement improvements and cost savings. None of this of course happens on its own. Teams and ag crowd leaders be an essential part of the Six Sigma methodology. Six Sigma is in that respectfore a methodology which requires and encourages assembly leaders and team ups to take responsibility for implementing the Six Sigma processes. life-or-deathly these hoi polloi subscribe to be trained in Six Sigma’s methods †especially the use of the measurement and improvement tools, and in communications and relationship skills, demand to involve and serve the inescapably of the internal and orthogonal nodes and suppliers that form the critical processes of the organization’s actors line chains. Training is in that respectfore also an essential component of the Six Sigma methodology, and lots of it. Six Sigma teams and nona bly Six Sigma team leaders (‘Black Belts’) use a vast array of tools at each peak of Six Sigma implementation to define measure, analyse and see variation in process feeling, and to manage pack, teams and communications.\r\nWhen an organization decides to implement Six Sigma, first the executive team has to decide the strategy †which might typically be termed an improvement initiative, and this base strategy should focus on the essential processes necessary to bechance upon guest expectations. This could totality to twenty or thirty cable process. At the top level these argon the main processes that budge the organization to add value to goods and services and tot up them to customers. Implicit within this is an arrangement of what the customers †internal and external †veritablely want and engage. A team of motorbuss (‘Black Belts’ normally) who ‘own’ this processes is responsible for: identifying and escorti ng these processes in detail, and also collar the levels of quality (especially tolerance of variation) that customers (internal and external) expect, and thusly bar the effectiveness and efficiency of each process performance †notably the ‘sigma’ performance †ie., is the number of defects per million trading operations (pro-rate if appropriate of course). The conjecture is entirely logical: arrest and then improving the most important ‘ gifty-chain’ processes ordain naturally increase efficiency, customer satisfaction, belligerent advantage, and do goodability. slowly said †tricky to achieve †which is what the Six Sigma methodology is for.\r\n sixer SIGMA PROCESS\r\nThe term â€Å"six sigma process” bob ups from the notion that if one has six streamer deviations mingled with the process mean and the ne arst particularisedation limit, as shown in the graph, practically no items leave alone fail to meet particularis edations. This is based on the calculation method employed in process ability studies. ability studies measure the number of standard deviations between the process mean and the neargonst specification limit in sigma units. As process standard deviation goes up, or the mean of the process moves a way of life from the concentrate of the tolerance, fewer standard deviations will fit between the mean and the ne arst specification limit, decreasing the sigma number and increase the likelihood of items outside specification\r\nSCALE OF beat\r\nThe table below gives bulky-term DPMO values similar to various short-term sigma levels. It essential(prenominal)(prenominal) be understand that these figures assume that the process mean will fight by 1.5 sigma toward the side with the critical specification limit. In other words, they assume that later on the initial chafe wind determining the short-term sigma level, the long-termCpk value will magic spell out to be 0.5 less than the short-term Cpk value. So, for example, the speculative parts per million opportunities (DPMO) figure given for 1 sigma assumes that the long-term process mean will be 0.5 sigma beyond the specification limit (Cpk = â€0.17), rather than 1 sigma within it, as it was in the short-term regard (Cpk = 0.33). Note that the defect partages indicate only defects particular(a) the specification limit to which the process mean is neargonst. Defects beyond the far specification limit atomic number 18 not included in the percentages.\r\nSigma level\r\nDPMO\r\nPercent imperfect\r\nPercentage yield\r\nShort-term Cpk\r\nLong-term Cpk\r\n1\r\n691,462\r\n69%\r\n31%\r\n0.33\r\nâ€0.17\r\n2\r\n308,538\r\n31%\r\n69%\r\n0.67\r\n0.17\r\n3\r\n66,807\r\n6.7%\r\n93.3%\r\n1.00\r\n0.5\r\n4\r\n6,210\r\n0.62%\r\n99.38%\r\n1.33\r\n0.83\r\n5\r\n233\r\n0.023%\r\n99.977%\r\n1.67\r\n1.17\r\n6\r\n3.4\r\n0.00034%\r\n99.99966%\r\n2.00\r\n1.5\r\n methodology\r\nSix Sigma go steadys follow cardinal projec t methodologies stir by Deming’s Plan-Do-Check-Act Cycle. These methodologies, composed of quintuple phases each, exonerate the acronyms DMAIC and DMADV. DMAIC is used for projects aimed at improving an existing business process. DMADV is used for projects aimed at creating a in the raw product or process architectural plan. The DMAIC project methodology has five phases: Define the problem, the voice of the customer, and the project cultures, specifically. Measure find out aspects of the current process and collect relevant data. read the data to investigate and verify cause-and-effect relationships. Determine what the relationships atomic number 18, and commence to watch that all factors take aim been considered. Seek out root cause of the defect under investigation. repair or optimize the current process based upon data analysis using techniques such(prenominal)(prenominal) as design of experiments, poka yoke or mistake proofing, and standard work to take a l eak a new, future raise process. Set up pilot runs to establish process capability. Control the future state process to ensure that any deviations from tar bring atomic number 18 corrected forward they result in defects. Implement control constitutions such as statistical process control, production boards, optic workplaces, and continuously monitor the process. approximately organizations add a Recognize step at the beginning, which is to recognize the right problem to work on, thus yielding an RDMAIC methodology.\r\nDMADV or DFSS\r\nThe DMADV project methodology, cognize as DFSS (â€Å"Design For Six Sigma”),[features five phases: Define design intents that are reconciled with customer demands and the enterprise strategy. Measure and identify CTQs (characteristics that are Critical To smell), product capabilities, production process capability, and risks. lose it to develop and design alternatives, create a upper-level design and evaluate design capability to g et hold of the best design. Design flesh out, optimize the design, and plan for design verification. This phase may require simulations. Verify the design, institute up pilot runs, implement the production process and hand it over to the process owner(s).\r\nTHE TOOLS AND THEMES\r\nLike most great inventions, Six Sigma is not â€Å"all new.” While some themes of Six Sigma arise out of fair recent break by dint ofs in management thinking, others stick their root word in common champion.\r\nBefore you dismiss that origin as no big deal, we’d actuate you of a saying: â€Å"Common sense is the least common of the senses.” From a â€Å"tools” perspective, Six Sigma is a attractive vast universe. The more we mystify learned over the years more or less the Six Sigma system, the more we develop come to see it as a way to link togetherâ€and even to implementâ€many otherwise disconnected ideas, trends, and tools in business today. Some of the â₠¬Å"hot topics” that have direct application or discount complement a Six Sigma initiative include: e-Commerce and Services\r\nEnterprise Resource proviso\r\n go manufacturing\r\nCustomer Relationship Management systems\r\nstrategic business partnerships\r\nKnowledge management\r\nActivity-based management\r\nThe â€Å"process-centred organization”\r\nGlobalization\r\nJust-in- era inventory/production\r\nSix stems of Six Sigma\r\nWe’ll close out this introductory figure at Six Sigma by di in timeing the critical elements of this leadership system into six â€Å"themes.” These principlesâ€supported by the many Six Sigma tools and methods we’ll be presenting passim this bookâ€will give you a p examine of how we’ll help you make Six Sigma work for your business.\r\n alkali One: Genuine focalization on the Customer\r\nDuring the big match Quality push of the 1980s and 1990s, dozens of companies wrote policies and mission statements vo wing to â€Å"meet or exceed customer expectations and requirements.” Unfortunately, however, few businesses try very hard to improve their understanding of customers’ requirements or expectations. horizontal when they did, customer data-gathering typically was a one- age or short-lived initiative that ignored the dynamic personality of customer needs. In Six Sigma, customer focus becomes the top priority. For example, the measures of Six Sigma performance begin with the customer. Six Sigma improvements are defined by their impact on customer satisfaction and value. We’ll look at wherefore and how your business great deal define customer requirements, measure performance against them, and stay on top of new developments and unmet needs.\r\nTheme Two: Data- and Fact-Driven Management\r\nSix Sigma takes the concept of â€Å"management by fact” to a new, more powerful level. condescension the attention paid in recent years to measures, improved cultiv ation systems, acquaintance management, etc., it should come as no shock to you to ensure that many business decisions are unflustered organismness based on opinions and assumptions. Six Sigma discipline begins by clarifying what measures are key to gauging business performance; then it applies data and analysis so as to build an understanding of key variables and optimize results. At a more down-to-earth level, Six Sigma helps managers rejoinder two essential questions to support fact-driven decisions and solutions:\r\n1. What data/information do I really need?\r\n2. How do we use that data/information to uttermost gather?\r\nTheme Three: Process Focus, Management, and Improvement\r\nIn Six Sigma, processes are where the action is. Whether designing products and services, measuring performance, improving efficiency and customer satisfactionâ€or even running the businessâ€Six Sigma positions the process as the key vehicle of success. One of the most remarkable break fin isheds in Six Sigma efforts to date has been persuade leaders and managersâ€particularly in the service-based functions and industriesâ€that mastering processes is not just a necessary evil just now actually a way to build competitive advantage in retroverting value to customers. at that place are many more people to convince†with huge dollar opportunities buttoned up in those activities.\r\nTheme 4: Proactive Management\r\nMost plainly, universe â€Å"proactive” signifies acting in advance of events†the polar of being â€Å"reactive.” In the real world, though, proactive management means fashioning habits out of what are, too often, omit business practices: defining ambitious goals and retreading them frequently; ambit clear priorities; focusing on problem prevention versus fire fighting; questioning why we do things instead of blindly defending them as â€Å"how we do things here.” Being truly proactive, far from being slow or ove rly analytical, is actually a starting point for creativity and effective change. Reactively bouncing from crisis to crisis makes you very busyâ€giving a false popular opinion that you’re on top of things. In reality, it’s a sign of a manager or an organization that’s lost control. Six Sigma, as we’ll see, encompasses tools and practices that replace reactive habits with a dynamic, responsive, proactive sprint of management. Considering today’s slim-margin-for-error competitive environment, being proactive is (as the airline commercial said) â€Å"the only way to fly.”\r\nTheme phoebe bird: saltation less Collaboration\r\nâ€Å"Boundary less” is one of Jack Welch’s mantras for business success. Years sooner launching Six Sigma, GE’s chairman was on the job(p) to break down barriers and improve teamwork, up, down, and crosswise organizational lines. The opportunities available through improved collaboration with in companies and with their vendors and customers are huge. Billions of dollars are left on the table (or on the floor) either day, because of disconnects and outright competition between multitudes that should be workings for a common cause: providing value to customers. As noted above, Six Sigma expands opportunities for collaboration as people learn how their roles fit into the â€Å"big picture” and bear recognize and measure the interdependence of activities in all parts of Process. Boundary less collaboration in Six Sigma does not mean selfless sacrifice, but it does require an understanding of both(prenominal) the real needs of end users and of the flow of work through a process or a return chain. Moreover, it demands an view that is committed to using customer and process association to benefit all parties. Thus, the Six Sigma system can create an environment and management structures that support certain teamwork.\r\nTheme Six: Drive for Perfection; gross p rofit\r\nThis last theme may seem contradictory. How can you be driven to achieve perfection and continue also tolerate failure? In essence, though, the two ideas are complementary. No family will get anywhere close to Six Sigma without launching new ideas and approachesâ€which always involve some risk. If people who see a possible path to better service, note costs, new capabilities, etc. (i.e. ways to be closer-to-perfect) are too afraid of the consequences of mistakes, they’ll neer try. The result: stagnation, putrefaction, death. Fortunately, the techniques we’ll review for improving performance include a earthshaking dose of risk management (if you’re exit to fail, make it a safe failure). The bottom line, though, is that any caller-out that makes Six Sigma its goal will have to constantly push to be evermore- perfect (since the customer’s definition of â€Å"perfect” will always be changing) while being willing to abideâ€and m anageâ€occasional setbacks.\r\nSOME SUCCESS STORIES\r\n see the impact that Six Sigma is having on some spark advance companies sets the stage for understanding how it can impact your business. As we relate some of these results, we’ll also be reviewing the history that has brought Six Sigma to the forefront\r\nGeneral Electric\r\nSix Sigma has forever changed GE. Everyoneâ€from the Six Sigma zealots emerging from their Black Belt tours, to the engineers, the auditors, and the scientists, to the senior leadership that will take this association into the new millenniumâ€is a true truster in Six Sigma, the way this Company now works.” â€GE Chairman John F. Welch1 When a high-profile corporate leader* starts using words like â€Å" fed up(p)” or â€Å"lunatics” in connection with the future of the companyâ€you might expect a plunge in the company’s share price. At General Electric, however, that heating plant and drive behind Six Sig ma have produced some very positive results. The hard be behind GE’s Six Sigma initiative spread abroad just part of the story. From an initial year or so of break-even efforts, the payoff has accelerated: $750 million by the end of 1998, a forecasted $1.5 billion by the end of 1999, and expectations of more billions down the road. Some debate Street analysts have predicted $5 billion in gains from the effort, early in the decade. GE’s operational marginsâ€for decades in the 10 percent rangeâ€continue to hit new records quarter after quarter. The verse are now consistently above 15 percent, and even higher in some terminuss. GE leaders cite this margin expansion as the most visible evidence of the fiscal office make by Six Sigma.\r\nImprovements from Services to Manufacturing\r\nThe financial â€Å"big picture,” though, is just a reflection of the many individual successes GE has achieved through its Six Sigma initiative. For example:\r\nâÅ"¦ A Si x Sigma team at GE’s Lighting unit repaired problems in its cathexis to one of its top customersâ€Wal-Martâ€cutting invoice defects and disputes by 98 percent, speeding payment, and creating better productivity for both companies.\r\nâÅ"¦ A multitude led by a staff attorneyâ€a Six Sigma team leaderâ€at one of GE ceiling’s service businesses streamlined the slenderize review process, leading to faster completion of dealsâ€in other words, more responsive service to customersâ€and annual savings of $1 million.\r\nâÅ"¦ GE’s Power Systems group addressed a major irritant with its value company customers, simply by developing a better understanding of their requirements and improving the documentation provided along with new power equipment. The result: Utilities can act more effectively to their regulatory agencies, and both the utilities and GE have saved hundreds of thousands of dollars a year.\r\nâÅ"¦ The Medical Systems businessâ₠¬GEMSâ€used Six Sigma design techniques to create a breakthrough in medical scanning technology. Patients can now get a full-body scan in half a minute, versus three minutes or more with previous technology. Hospitals can increase their enjoyment of the equipment and achieve a impose cost per scan, as well up.\r\nâÅ"¦ GE Capital Mortgage analyzed the processes at one of its top performing branches andâ€expanding these â€Å"best practices” across its other 42 branchesâ€improved the rate of a caller paying a â€Å"live” GE person from 76 to 99 percent. Beyond the much greater toilet facility and responsiveness to customers, the improved process is translating into millions of dollars in new business.\r\nThe Actions behind the Results\r\nGE’s successes are the result of a â€Å"passionate” allegiance and effort. Notes Welch: â€Å"In nearly four decades with GE I have never seen any Company initiative move so willingly and so speedily in pursuit of a big idea.”2 Tens of thousands of GE managers and associates have been trained in Six Sigma methodsâ€a hefty investment in clipping and money (which is appropriately deducted from the gains cited earlier). The training has gone well beyond â€Å"Black Belts” and teams to include every manager and professional at GEâ€and many front-line people as well. They’ve instilled a new vocabulary revolving around customers, processes, and measurement. While dollars and statistical tools seem to get the most publicity, the fierceness on customers is probably the most remarkable element of Six Sigma at GE. As Jack Welch explains it: The best Six Sigma projects begin not inside the business but outside it, focused on answering the questionâ€how can we make the customer more competitive? What is critical to the customer’s success? . . . One thing we have detect with certainty is that anything we do that makes the customer more boffo inevitably r esults in a financial rescue for us.\r\n confederateSignal/Honeywell\r\n totallyiedSignalâ€with the new name of â€Å"Honeywell” following its 1999mergerâ€is a Six Sigma success story that connects Motorola and GE. It was CEO Larry Bossidyâ€a long time GE executive, who took the helm at Allied in 1991â€who convinced Jack Welch that Six Sigma was an approach worth considering. (Welch had been one of the few top managers not to become enamoured of the TQM movement in the 1980s and early 1990s). Allied began its own quality improvement activities in the early 1990s, and by 1999 was saving more than $600 million a year, thanks to the widespread employee training in and application of Six Sigma principles.5 Not only were Allied’s Six Sigma teams reducing the costs of remoulding defects, they were applying the self alike(p)(prenominal) principles to the design of new products like aircraft engines, reducing the time from design to certification from 42 to 33 m onths. The company credits Six Sigma with a 6 percent productivity increase in 1998 and with its record profit margins of 13 percent. Since the Six Sigma effort began, the firm’s market value hadâ€through fiscal year 1998â€climbed to a compounded 27 percent per year. Allied’s leaders view Six Sigma as â€Å"more than just numbersâ€it’s a statement of our determination to pursue a standard of excellence using every tool at our disposal and never hesitating to reinvent the way we do things.” As one of Allied’s Six Sigma directors puts it: â€Å"It’s changed the way we think and the way we communicate. We never used to talk round the process or the customer; now they’re part of our everyday conversation.” AlliedSignal’s Six Sigma leadership has helped it earn recognition as the world’s best-diversified company and the most admired global aerospace company .\r\n tint\r\nThere are many well known companies th at have implemented Six Sigma plans and reached astounding results. Companies like General Electric, Motorola, Ford, Honeywell and American standard have all reaped the benefits of successful Six Sigma quality programs. Motorola claims to have saved $17 billion from 1986 to 2004 by successfully implementing their strategies throughout all departments of the company. The other companies have achieved staggering results such as cutting invoice defects and disputes, streamlined contract processes, lessening in project duration, deplete elimination, trim back energy costs and increased production capacity. By understanding the philosophy and deploying the program, these companies have succeeded in making themselves more effective and more profitable for their stakeholders. Companies indirect request to make changes to their quality system should research this and consider Six Sigma as an option.\r\nBENEFITS\r\nIt is clear that many companies have capitalized on the application of Si x Sigma to their business model. If we look deeper into the appeal of Six Sigma, past the historical quantitative gains, we will find several(prenominal) benefits that companies find attractive. 1. â€Å"Generates sustain success” †The only way to sustain a high level of growth is to continually bring out and remake the organization. A Six Sigma process creates the skills and elaboration to achieve this continuous process improvement cycle. 2. â€Å"Sets a performance goal for everyone” †a company is made up of two-fold departments with different tasks and objectives. Six Sigma provides a common objective for all departments to be as close to perfect as possible. The idea is that if you understand the customer’s requirements, then you can measure for defects. 3. â€Å"Enhances Customer Value” †The focus of Six Sigma is understanding what the customer requirements are and delivering a product or service within those requirements. 4. â₠¬Å"Increases the rate of improvement” †Six Sigma helps a company stay on top of it’s improvement efforts by constantly update requirements and identifying defects before they happen.\r\n5. â€Å"Promotes Learning” †Six sigma brings experts together with novices to manage the process and teach the Six Sigma way of business. Companies that use Six Sigma view it as learning tool that is critical to their success. 6. â€Å"Executes strategic change” †Six Sigma gives you a better understanding of your company processes. The philosophy is tied back to the company goals so when it’s time for change there is a higher luck of success.”\r\nNEGATIVES\r\nJust like any other quality improvement initiatives we have seen in the past, Six Sigma has its own limitations. The following are some of the limitations of Six Sigma which create opportunities for future research :\r\n1. â€Å"Kills Creativity” †Six Sigma gives emphasis on the rigidity of the process which basically contradicts the foundation and kills the creativity. The innovative approach implies deviations in production, the redundancy, the unusual solutions, insufficient study which are opposite to Six Sigma principles.\r\n2. â€Å" image of consultants” †The use of â€Å"Black Belts” as itinerant change agents has (controversially) fostered an industry of training and certification. Critics argue there is overselling of Six Sigma by too great a number of consulting firms, many of which claim expertise in Six Sigma when they have only a rudimentary understanding of the tools and techniques involved.\r\n3. â€Å"Rigid” †A more direct unfavorable judgment is the â€Å"rigid” nature of Six Sigma with its over-reliance on methods and tools. In most cases, more attention is paid to reducing variation and searching for any significant factors and less attention is paid to developing robustness in the first place (wh ich can altogether use up the need for reducing variation.)\r\n4. â€Å"Criticism of the 1.5 sigma pocket” †The 1.5 sigma shift has also become contentious because it results in state â€Å"sigma levels” that reflect short-term rather than long-term performance: a process that has long-term defect levels comparable to 4.\r\n5 sigma performance is, by Six Sigma convention, described as a â€Å"six sigma process.”. The accepted Six Sigma scoring system thus cannot be equated to actual normal distribution probabilities for the stated number of standard deviations, and this has been a key bone of contention over how Six Sigma measures are defined.\r\nAPPLICATIONS\r\nIn pharmaceutical industry, betrothal of the Six Sigma technique helped the industry reduce wastage and rework involved in the production. It was said that 5-10% of medicines produced during a period were to be discarded or modified collect to the defects. The adoption of Six Sigma helped the p harmaceutical companies to reduce the errors in the production.\r\nAirline industry had to adopt the Six Sigma prosody for its survival. The increased cost of fuel, the competition driven by low budget airlines, etc has made the need for lower cost without a hit to quality the need of the hour. The number of errors in handling the calls from customers, and ticketing is to be minimised drastically. It was with this determination that the airline industry adopted Six Sigma into the organisation. Indian companies like Kingfisher, Jet Airways, and Indian Airlines, all have adopted Six Sigma technique into its process.\r\nHospitality services are another industry which benefited by the adoption of Six Sigma techniques. Providing personalised service to each and every customer by bending to their demands within a limited time without comprising the quality was aided by the Six Sigma matrices. The Six Sigma technique is adopted in every field from maintaining full occupancy to efficient h ousekeeping, ensuring a balanced inventory supply, and to minimise wastage in the inventory. Starwood hotels and resorts Inc was the first company to adopt Six Sigma in the hospitality sector.\r\nSteel industries like TISCO use this technique to minimise the inadequacies in the design, imperfect products, etc. I. Logistics, insurance, call centres, all embrace the Six Sigma techniques for improving the quality of service provided by them. Six Sigma goes in to the details of improving customer service, generating business expansion and gaining knowledge rough the service sectors business processes. Most service industries revolve around areas of finance, human resources and sales and marketing. Hence, Six Sigma delves deeply into the subject of soft skill. Irrespective(prenominal) of the causa of industry, all companies have to adopt Six Sigma techniques as quality and by the way delivery are crucial for their survival.\r\nSOME COMMON CONFUSUIONS\r\nKAIZEN †â€Å"Kaizenâ₠¬Â, is a Japanese word, centre â€Å"improvement”, or â€Å"change for the better” refers to philosophy or practices that focus upon continuous improvement of processes in manufacturing, engineering, and business management. When used in the business sense and applied to the workplace, kaizen refers to activities that continually improve all functions, and involves all employees from the CEO to the assembly line workers. It also applies to processes, such as purchasing and logistics that cross organizational boundaries into the supply chain. By improving standardized activities and processes, kaizen aims to eliminate ravage (see lean manufacturing). Kaizen was first implemented in several Japanese businesses after the Second World War, influenced in part by American business and quality management teachers who visited the country. It has since spread throughout the world] and is now being implemented in many other venues anyway just business and productivity. Six S igma process involves employees at every level to improve a process. The theory is that a machine operator is best worthy to identify the waste surrounding that machine. Employees participate in KAIZENS (a sort of quality circle) to eliminate all the waste along the process of delivering to customers. Everything left over is pregnant and profitable work. Generally, the employees themselves are empowered to recognize the need for an improvement, and to make that change immediately.\r\nLEAN SIX SIGMA †â€Å" scat Six Sigma” is a synergized managerial concept of Lean and Six Sigma that results in the elimination of the seven kinds of wastes (classified as Defects, Overproduction, Transportation, Waiting, Inventory, Motion and Over-Processing) and provision of goods and service at a rate of 3.4 defects per million opportunities Six Sigma as well is far more data-driven than Lean Six Sigma (and Lean). A Six Sigma level is, again, 3.4 defects per million; a Five Sigma level is 233 defects per million, and so on. As Michael L. George describes, every Six Sigma improvement requires â€Å"a measure to define the capability of any process.” This reliance upon precise measurement is what makes the DMAIC processlengthy; a DMAIC project may require thousands of measurements before project leaders can analyze the results. Lean Six Sigma does not ignore measurement where it is required, but does not rely upon it absolutely.\r\nTOTAL QUALITY MANAGEMENT †â€Å"Total Quality Management” or TQM is an integrative philosophy of management for continuously improving the quality of products and processes. TQM functions on the premise that the quality of products and processes is the responsibility of everyone who is involved with the induction or consumption of the products or services offered by an organization. In other words, TQM requires the involvement of management, workforce, suppliers, and customers, in rig to meet or exceed customer expect ations.\r\nTQM, as its name suggests, concerns itself entirely with quality. All efforts, finances and techniques are directed at improving quality as much as possible. While Six Sigma is certainly concerned with quality as well, it extends its focus to other issues such as product cycle time and cost. Because of this difference, Six Sigma can be much more manifold to implement but also can create farther-reaching benefits. The goals of TQM and Six Sigma differ in significant ways. Total Quality Management has no specific goals or endpoints at which management can aim. Basically, the goal of TQM is to always become â€Å"better,” an objective that can become both a blessing and a blighter as it continually inspires both motivation and frustration. Six Sigma, on the other hand, has the very distinct goal of 3.4 defects per million. This target gives the philosophy its name, as the amount is six standard deviations (represented by the Greek letter sigma) from the centre of a bell curve According to Six Sigma specialist Thomas Pryzdek, TQM originally have umbrageous and abstract guidelines that were difficult, if not impossible, for most managers to turn into tangible and implementable strategies. Six Sigma attempts to fix this problem by creating specific areas to target for improvement. In lieu of general statements about quality improvement, the Six Sigma philosophy pinpoints sectors of specialized focus.\r\n writ of execution\r\n• Analyze †Is the discovery of variations Six Sigma programs are deployed from the raising down and implemented from the bottom up. (Cariera and Trudell, 2006) You must have upper managements buy-in and full support. This support must be communicated effectively through the organization. Upper management must be willing to invest in training for their employees and willing to embrace the changes that will come out of the initiative. Although Six Sigma can involve some complex statistical theories and measurement tools, the barriers to successful implementations usually come from â€Å"behavioural” resistance rather than â€Å"technical” issues. (Kumar, 2006) The following are what Kumar considers â€Å"Fundamental rules for significant change”:\r\n• invariably include affected individuals in both supply and implementing improvements.\r\n• Provide sufficient time for employees to change.\r\n• Confine improvements to only those changes essential to remove the identified root cause(s).\r\n• paying attention an individual’s perceptions by listening and responding to his/her concerns.\r\n• visit leadership participation in the program.\r\n• Provide timely feedback to affected individuals.\r\nThese are all key points to implementing Six Sigma, however to a Six Sigma critic’s point, there is nothing really new here. This is very similar to many other management and quality philosophies. Regardless of what name you give it, these fundamentals are imperative for instituting positive change in an organization. perchance by applying these fundamentals under a recognized program such as Six Sigma, there will be a better chance for success. Each phase is important in its own right; however the key thing for long lasting results in understanding the Control phase. The control phase must include a plan for continuous review and improvement. The DMAIC roadmap should be looked at as a circular process rather than linear. During the control phase companies must continually look for new opportunities then restart the process at Design.\r\n vitrine STUDY\r\nMumbai Dabbawalas, a perfect example of SIX SIGMA.\r\n-Dr. Pawan Agrawal\r\nThe food is cooked at understructure. luncheoneon is yours. They [dabbawalas] will simply deliver it from your substructure to your workplace before dejeuner time and deliver the renounce luncheon concussion back in the evening at your home as well. wherefore would you want dabb awala to carry your lunch? There are two indicates. One is that the Mumbai topical anaesthetic trains have lines extending 60-70 km and two, they are displace. If you have to reach office at 9, you must start at 6. But you wouldn’t want to wake your love ones at 5 and have them prepare the tiffin for you; that’s where Dabbawala can help you. Another reason is that even if you start at 8, you won’t be able to carry your own tiffin because of how crowded the trains are. So, for these two reasons, Dabbawala has been in the business [of carrying your home food to your office] for the last 120 years. There’s a group of people called Varkari Sampradaya in Maharashtra; they are the devotees of Lord Vitthala and there’s a place called Pandharpur, the town of the temple of Vitthala. When they go to that place, they wear a ‘tulasi mala’. And when a person wears this mala, he will never drink or smoke because Lord Vitthala doesn’t like it and the same principle is brought into practice here. Dabbawalas touch that their customer is their Lord Vitthala. These people are poor, they are working in difficult situations, they are not qualified and they don’t use technology, and yet, they be possessed of all these qualities and work with passion and commitment.\r\nDabbawala was started in 1890 by Mr. Mahadeo Havaji Bachche. He was once asked by a Parsi working in the Britisher’s rank, â€Å"Will you bring my tiffin from my home?” He simply answered â€Å"Yes, I will, no problem.” From that day onwards, he started to collect tiffins from homes and delivering them to the respective workplaces. In 1890, there was one dabbawala and one customer, and now, there are 5000 dabbawalas and 200,000 customers, which means, one dabbawala carries approximately 40 tiffins. The maximum weight comes to 65-70kg; carrying that much weight in the crowded local anaesthetic trains is a lot of hard work. Why do they do it then? Work is worship. And, as far as qualification is concerned, you will see that the average literacy rate is 8th grade education; which means the dabbawalas are illiterate and yet they have managed to achieve a Six Sigma quality rating, which means only one wrong service in a 6 million deliveries. Ownership is a scent that an employee has to instil in oneself, and unless you get that flavoring of ownership you cannot work excellently. In 120 years, it has never happened that a dabbawala has failed to deliver. It’s impossible. They will never tell you that â€Å"the trains are late today,” and even if Mumbai trains are late, the tiffins can’t be late. The dabbawala knows that if he’s not outlet in time, his customer will eat outside food, pay money for it and waste time. The dabbawala knows the consequences of going late. So he always goes on time.\r\nThe people of Mumbai say with confidence that â€Å"our lunch can go wrong but not the Mumbai dabbawalas.” So zero can stop you from being punctual.. Let me mouth about (mukadal) group leaders. A group has 10, 20, or 25 dabbawalas, depending on the density of customers in your area, and their in- surge is the group leader. The responsibility to keep the dabbawalas and the customers happy is on the group leader. notwithstanding the fact that he doesn’t get even a rupee extra for the extra10% that he works, he feels proud to be a group leader. For example, the group leader also takes care of the train passes of the dabbawalas, to check whether they have expired or not; he reminds the dabbawalas in case their passes are about to expire in the next 2-3 eld and also buys the pass for the dabbawala if he fails to do so himself in order to ensure that timely delivery doesn’t suffer. I will tell you an instance of how one dabbawala performs duty in one day. He collects 40tiffin’s from a particular area and drops them in the foetid Parle rail road station because his customer is from Vile Parle. He can’t deliver all of them because he would have to go all over Mumbai, so he leaves these 40 there. That’s his first job. His second gear job is to collect 35-40 tiffins from his group leader and deliver them to Dadar. His third job is to deliver 30 tiffins to Chavani Road, and in the fourth job from Chavani Road, he delivers 30 Tiffin’s to church edificegate. His fifth job is to go from Church Gate to deliver 30 tiffins to NarimanPoint.\r\nFinally, in his one-sixth job, he delivers 30 tiffins to Express Tower to the customers before lunch time and after lunch, he will reroute back to his original area and deliver the same tiffins from where he had collected them. After all this, Forbes has found 1 erroneous delivery out of 6 million deliveries, but they don’t accept that either. They are unhappy that that one error has occurred. cardinal years ago, some people from Delhi came to Dabbawala and sa id they want to do research on Dabbawala; they prepared a project and went back to Delhi. They called after 3 months and informed Dabbawala about Six Sigma. Dabbawalas didn’t know what it meant. They told Dabbawala it was a big honour so Dabbawala asked them to pose it across. They were told to go to Delhi and collect it. Sixteen dabbawalas went to Delhi to collect the Six Sigma certification. commonwealth work so hard for three and Four Sigma but dabbawalas got Six Sigma because they didn’t care about the certification and cared only about customer satisfaction. It is a big achievement especially without the use of technology. Even if the dabbawalas use technology in the form of mobile phones, they can’t because both their hands are used in delivering tiffins. Technology is useless for them for delivery. And after all this, they charge only 400 rupees per month for delivery.\r\nSo, the question arises is that, why do they charge so less. They say customers a re poor. If they want more income, they work extra. Dabbawala then gave me an example of a teacher, who earns only Rs 5000 per month as a government rule. He said, â€Å"Despite the teacher’s double graduation, I earn more than him, so I’m happy.” For example, some customers refuse to pay bonus, but the dabbawalas don’t disrupt their services. So I asked one of them why, he said, â€Å"the customer is my God, he has paid me 12 months’ of payment so it’s ok if he doesn’t pay me one month’s bonus.” Despite the disputes there has never been a police or a court case. Every 15 days they have a meeting. The disputing dabbawalas resolve their disputes and if they can’t, the hot seat takes a call and they follow his judgment without questioning. Dabbawalas feel satisfied. I asked one customer, what he thinks about the dabbawalas. He said, â€Å"Excellent. When I get my salary I am afraid of carrying it in the local tra in because it’s so crowded and I can get robbed so instead, after I have lunch, I put the money in the empty dabba and send to my wife.” Dabbawalas are very honest.\r\nIf you do services consistently and with discipline, then the customer, at some point of time, will believe that you are God. In one day, one dabbawala handles 500 tiffins. There is a 79-year-old man who is a dabbawala, nobody’s forcing him, but he still works because he thinks he can still provide service to his customers. The dabbawalas use bicycles. Another thing is the coding system; about 100 years ago, they were using colour codes. Then when Mumbai grew and the number of customers increased, they started using alphabets; A for Andheri, B for Bandra, etc. And today, they write a proper code with details of the source, destination and all the dabbawalas involved in that particular delivery. When this tiffin is coded and then washed, sometimes the coding becomes unclear, so the dabbawala takes c olour out of his pocket and overwrites the code. He doesn’t complain about it, he just finishes the job. Due to the overcrowded Mumbai local trains, some people enter the luggage department, and when they do, the tiffins stick to their heads. So they start fighting with the dabbawalas and the dabbawalas also fight with them but only till the station arrives, because after that they’re more interested in the delivery. They use carts for longstanding distances. In running local trains, they sort the tiffins to save time. Risk is there, but it’s there everywhere. You must work with the situation.\r\nFor example, they lost some income and customers because of some instances. In 1969, customers stopped taking food. In 1975, there was a railway strike; the dabbawalas lost one month’s income. In 1982, 40,000 meal workers went on strike. bowl today they’re on strike. A lot of people lost their lives. Dabbawalas have gone through all this and come out shi ning. They have been featured on multiple channels and have been awarded multiple awards. These 50 Indians have influenced Mumbai: Tata, Birla, Ambani, Thakarey, Shahrukh Khan, Amitabh Bachhan and Mumbai Dabbawala. Somebody took a survey in Mumbai about the likes of people, and Dabbawala was one of them. I am not a Dabbawala. I’m not involved in any of the operations at all. I have done a Ph.D. on this subject and my topic was ‘A study of logistics in supply chain management of Dabbawala in Mumbai.’ It took a lot of years to complete my Ph.D. But, two days into the research, I was taken aback by the passion of these people. I decided to do the research whether or not I complete my Ph.D. Prince Charles came to Mumbai in 2003. Six months before his visit, Mr. Jeetendra Jain, in the British Council of India, contacted dabbawala to arrange a visit. Dabbawala first refused and then, after realizing that Prince Charles is Britain’s royalty in the manner of a kin g, he agreed, but, with two conditions.\r\n get-go one was that Prince Charles should come at the Dabbawala’s convenience †between 11 and 11.40 because that’s when they’re free. Second, Prince Charles must go to Dabbawala himself. Where to? The footpath. Prince Charles accepted these conditions. Richard Branson came to Mumbai. He wanted a photo with Dabbawala to put it up in his office in London to send a mental object to his employees to work like Dabbawalas. That’s the impact of Mumbai Dabbawala. There was an inauguration of a book written by Shobha Bondre. This was inaugurated by the then Chief Minister of Maharashtra, Mr. Vilasrao Deshmukh. The chief minister said that for every program he goes an hour late but for a dabbawala program he came 5 minutes early because he was scared that if he came late the Dabbawalas will go away.\r\nANALYSIS\r\nHow the Dabbawalas works?\r\n1. Collecting food dabbas\r\n2. select +Grouping\r\n3. Transporting\r\n4. Receiving\r\n5. Delivering\r\n6. Collecting empty dabbas\r\n1. Collecting\r\nA collecting dabbawala, usually on bicycle, collects dabbas either from a worker’s home or from the dabba makers. The dabbas have some sort of distinguishing mark on them, such as a colour or symbol.\r\n2. take + Grouping\r\nThe dabbawala then takes them to a designated sorting place, where he and other collecting dabbawalas sort (and sometimes bundle) the lunch boxes into groups.\r\n3. Transporting\r\nThe grouped boxes are put in the coaches of trains, with markings to identify the destination of the box (usually there is a designated car for the boxes).\r\n4. Receiving\r\nThe markings include the railway station to unload the boxes and the building address where the box has to be delivered. At each station, boxes are handed over to a local dabbawala.\r\n5. Delivering:\r\nThe local dabbawala delivers the dabbas to the respective places.\r\n6. Collecting empty dabbas\r\nThe empty boxes, after lunch , are again collected and sent back to the respective houses or dabba makers\r\nFactors contributing to their success\r\n1. Cost efficient and faster delivery :\r\nThe dabbawalas charge a nominal monthly fee which is cheap and they have an efficient delivery network which makes them deliver on time.\r\n2. Highly reliable:\r\nOn time delivery for all the â€Å"dabbas” and hardly any errors. All deliveries have ensured 100% customer satisfaction. There are cost best in time management and have been awarded six sigma rating.\r\n3. Using Mumbai’s railway network :\r\nUsing the Mumbai sub urban railways for their passing(a) transportation from homes to the offices. Thus making it a cheaper and more efficient system.\r\n4. Structure:\r\nThey have a mat hierarchical in the organisation. Just 3 levels of organisation: carriers, supervisors and committee members. This flat structureimplies a wide duet of control. Every supervisor has about 4-5 carriers under him.\r\n purpos e\r\nSix Sigma looks at all work as a series of processes with inherent variations, which can cause waste or inefficiency. Focusing on those processes with superior impact on business performance, as defined by leadership teams, the methodology involves statistical analysis to quantify repeated common cause variations †which can then be reduced by the Six Sigma team. Six Sigma becomes a continuous process for quality improvement and cost reduction flowing throughout the company. Originally developed from a Japanese quality control process for manufacturing electronic semi-conductors, Six Sigma developed the capability of reducing problems or issues effecting customer expectations on key business processes. Six Sigma has provided the opportunity to drive forward important customer focused initiatives across the Cummins global organisation. As an improvement and cost reduction process, Six Sigma is equally valid for marketing and product development as well as manufacturing and customer services. Six Sigma improvement projects and techniques are now the bottom of Cummins continued success in cost reduction and quality improvement.\r\nREFERENCES\r\nLINKS\r\nhttp://www.experts123.com/q/who-invented-six-sigma.html as on 11/10/2012 http://en.wikipedia.org/wiki/Six_sigma as on 11/10/2012\r\nhttp://www.benchmarksixsigma.com/ on 12/10/2012\r\nhttp://www.6sigma.us/six-sigma.php as on 13/10/2012\r\nhttp://www.businessballs.com/sixsigma.html as on 13/10/2012\r\nhttp://www.benchmarksixsigma.com/ as on 13/10/2012\r\nBOOKS\r\nPede, Peter.S (2002), Mc-Graw Hill, The Six Sigma Way (from 029-72) De Feo, Joseph A.; Barnard, William (2005). JURAN Institute’s Six Sigma breakthrough and Beyond †Quality Performance Breakthrough Methods. New York, NY: McGraw-Hill Professional. ISBN 0-07-142227-7 (from p235- 245). Ramias, Alan, The Mists of Six Sigma, (2005), BP Trends (from p5-9) Eckes, George, Six Sigma for Everyone, 2003, John Wiley & Sons, Inc., Hoboken, NJ. (p 155-169)\r\n'