TOTAL QUALITY MANAGEMENT (TQM)

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Main Content:1.Introduction, History, Production System2.Understanding Quality3.Commitment and Leadership: TQM

approach, Commitment & Policy, Creating a Culture, TQM Model

4.Design For Quality: Design Control & Management, Specifications & Standard

5.Focus on the Customer6.Learning from the Quality Gurus7.Baldrige Awards, Deming Prize8.Six Sigma

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Topic 1

The Foundations – A Model for TQM

Presented By: Assoc. Prof. Dr. Nor Hayati

Saad3

Previous Semester Achievement

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Previous Semester Achievement

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Previous Semester Achievement (March 2014)

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EMSTD2

EMSTD1

HISTORY / History of Quality Assurance- Industrial Revolution in 1800’s: rise of inspection and separate quality departments

- Scientific Management – Frederick Taylor 1900’s- Bell Telephone Laboratories 1920’s; Statistical Quality Control- Global Competition 1970’s – 1980’s – Japan- Quality Revolution 1980 – Deming- Malcolm Baldrige National Quality Award (1987)

- Quality is a requirement for success in today’s global market 1997

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HISTORY / History of Quality Assurance (cont.)HISTORY / History of Quality Assurance (cont.)

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- Skilled craftsmanship during Middle Ages- Quality control during World War II- Quality awareness in manufacturing industry

during 1980s: “Total Quality Management”- Quality in service industries, government, health

care, and education- Current and future challenge: keep progress in

quality management alive

PRODUCTION SYSTEMS

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What is a SYSTEM

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A system is a group of related parts that works together to achieve a goal.

The goal is whatever the system is supposed to do.

Classification of SYSTEMS

Systems

Natural Systems Technological Systems

Human Being Animals Plants Organizations ProductsOthers

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Subsystems

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A system can have many parts. Subsystems are smaller systems that are combined to produce larger systems.

Example:System.... ComputerSubsystems... Keyboard, disk drive, monitor, printer,

etc

The Universal Systems Model

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The universal systems model can be applied to all technological systems and to many natural systems.

A system needs a goal that describes the purpose of the system. All systems also have an input, process, and output.

INPUT PROCESS OUTPUT

Resources put into the system

Combines resources

What comes from the system

WHAT IS PRODUCTION SYSTEM??WHERE CAN YOU DETECT THE ‘QUALITY’?

InputInput includes anything that is put into system. The input comes from the resources.A resource is anything that provides supplies or support for the system.All technological systems requires input from 7 categories of resources.

PeoplePeople InformationInformation EnergyEnergy CapitalCapital

MaterialsMaterials Tools and Tools and machinesmachines

TimeTime

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Process

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Process is a series of actions leading to an outcome. Process transforms resources into product or service.This is where resources are combined.

INPUT PROCESS OUTPUT

Production processes usually have 2 major subsystems: Management and Production

Major Subsystems of Process

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INPUT PROCESS OUTPUT

ManagingManaging

PlanningPlanning PreprocessingPreprocessing

ControllingControlling

ProcessingProcessingOrganizingOrganizing

PostprocessingPostprocessing

ProducingProducing

Output

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Output is the result of a system.

Example: Tv, computer, table, car, vegetables, meals..Education, maintenance, catering..

All these outputs are planned and desirable. Undesirable outputs from production systems include air and

water pollution, chemicals that are difficult to dispose of , and noise.

Waste materials are another kind of output produced by most systems. Therefore, companies want to reduce or eliminate waste.

Feedback

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Feedback occurs when information about the output of a system is sent back to the system.

Feedback can improve the performance of a system.

INPUT PROCESS OUTPUT

FEEDBACKFEEDBACK

Production Systems

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The goal of a production system is to manufacture or construct products.

Clothes, appliances, books Manufacturing Building, road, bridge Construction

Two kinds of outputs could be produced:

Good or Service

Characteristics of Goods

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• Tangible product• Consistent product

definition• Production usually

separate from consumption

• Can be inventoried• High/ Low customer

interaction© 1995 Corel Corp.

Characteristics of Service

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• Intangible product• Produced & consumed

at same time• Often unique• High customer

interaction• Inconsistent product

definition• Often knowledge-based© 1995 Corel Corp.

Goods Versus Services

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Can be resold Can be inventoried Some aspects of quality

measurable Selling is distinct from

production Product is transportable Site of facility important for

cost Often easy to automate Revenue generated

primarily from tangible product

• Reselling unusual• Difficult to inventory• Quality difficult to measure• Selling is part of service

• Provider, not product is transportable

• Site of facility important for customer contact

• Often difficult to automate• Revenue generated

primarily from intangible service.

GoodsGoods ServiceService

Goods

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HOW & WHY YOU SEGREGATE DIFFERENT TYPE OF PRODUCT IN THE MARKET?

QUALITY?

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Modern Importance of QualityModern Importance of Quality

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“The first job we have is to turn out quality merchandise that consumers will buy and keep on buying. If we produce it efficiently and economically, we will earn a profit, in which you will share.”

- William Cooper Procter[American Businessman, a manufacturer who established the nation's first profit-sharing

plan for employees]

Understanding of QualityUnderstanding of Quality

Defining Quality

ASQC (American Society for Quality Control)- “quality is a subjective term for which each person has his or her own definition”

What’s your definition?

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Defining QualityIn technical usage, quality can have two

meanings:the characteristics of a product or service that

bear on its ability to satisfy stated or implied needs, and

a product or service free of deficiencies

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Defining Quality - “Gurus”Deming - “non-faulty systems”

Out of the CrisisJuran - “fitness for use”

Quality Control HandbookCrosby - “conformance to requirements”

Quality is Free

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Armand Feigenbaum - author: Total Quality Control (1961)

“quality is a customer determination based on the customer’s actual experience with the product or service, measured against his or her requirements - stated or unstated, conscious or merely sensed, technically operational or entirely subjective - and always representing a moving target in a competitive market.”

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Stout’s View

Quality = PerformanceExpectation

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Defining Quality

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Definition of Quality by managers of 86 firms:

-Perfection-Consistency-Eliminating waste-Speed of delivery-Compliances with policies and procedures-Providing a good, usable product-Doing it right the first time-Delighting and pleasing customers-Total customer services and satisfaction

Defining Quality- (3) Different Views Customer’s view (more subjective)

the quality of the design (look, feel, function)product does what’s intended and lasts

Producer’s viewconformance to requirements (Crosby)costs of quality (prevention, scrap, warranty)increasing conformance raises profits

Government’s viewproducts should be safenot harmful to environment

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Five (5) Types of Product Quality

Transcendent/ Inspiring QualityInherent value or innate excellence apparent to the

individual.Product-Based Quality

The presence or absence of a given product attribute.User-Based Quality

Quality of the product as determined by its ability to meet the user’s expectations.

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Five Types of Product Quality (cont’d)

Manufacturing-Based QualityHow well the product conforms to its design

specification or blueprint.Value-Based Quality

How much value each customer separately attributes to the product in calculating their personal cost-benefit ratio.

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Transcendent (Judgemental) definition of QualityTranscendent (Judgemental) definition of Quality

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Excellence You just know it when you see it..

Product-based definitionQuantities of product attributes

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User-based definitionFitness for intended use.How well the product its intended use.Satisfying customer needs

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Value-based definition

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Relationship of usefulness or satisfaction to price.

Quality vs. price

Value-based Approach Manufacturing

dimensionsPerformanceFeaturesReliabilityConformanceDurabilityServiceabilityAestheticsPerceived quality

Service dimensionsReliabilityResponsivenessAssuranceEmpathyTangibles

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Manufacturing-based definition

Conformance to specifications, or desirable outcome of the engineering and manufacturing practice.

Targets and tolerances: 236 +/- 0.3cm

Same taste everytime, everywhere

On time arrival

10:30 pm40

Quality PerspectivesQuality Perspectives

CustomerCustomer

DistributionDistribution

productsproducts and and servicesservices

needsneeds

transcendent &transcendent &product-basedproduct-based user-baseduser-based

manufacturing-manufacturing- based based

value-basedvalue-based

MarketingMarketing

DesignDesign

ManufacturingManufacturing

Information flowInformation flowProduct flowProduct flow41

Shift to Quality

Pre-World War IIPre-World War II 19451945 19901990’’ss

IsolatedIsolatedEconomiesEconomies

Focus onFocus onquantityquantity

Period ofPeriod ofchange fromchange fromquantity toquantity toqualityquality

GlobalGlobalEconomyEconomy

Focus onFocus onQuality & QuantityQuality & Quantity

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Customer-Driven QualityCustomer-Driven Quality

“Meeting or exceeding customer expectations”

Customers can be...ConsumersExternal customersInternal customers

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Unique Challenges for Service Providers

Strategic Service Challenge To anticipate and exceed customer’s expectations. Distinctive service characteristics

1. Customers participate directly in the production process.2. Services are consumed immediately and cannot be stored.3. Services are provided where and when the customer desires.4. Services tend to be labor intensive.5. Services are intangible.

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Service Providers WHAT ARE EXAMPLES OF

CRITICAL SERVICE FOR CUSTOMERS?

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Total Quality- Customer satisfaction and reducing costs- A systems approach that integrates organizational

functions and the entire supply chain- Stresses learning and adaptation to change- Based on the scientific method

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Deming’s View of a Production System

Suppliers ofmaterials and equipment

Receipt and test of materials

Design and Redesign

Consumer research

ABCD

Production, assembly inspection

Tests of processes, machines, methods

Distribution

Consumers

INPUTS PROCESSES OUTPUTS47

Three Levels of QualityOrganizational level: meeting

external customer requirementsProcess level: linking external and

internal customer requirementsPerformer/job level: meeting internal

customer requirements

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Organizational LevelExternal customer requirements.Questions are:Which product and service meet your

expectationsWhich do not.What product and services do you need that you

are receiving.What product and services do not need that you

are receiving.

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Process LevelOrganizational units are classified as functions or

departments.Questions:What product and services are most important to the

external customerWhat process produces those products and servicesWhat are the key inputs to the processWhich processes have the most significant effects on

the organization customer-driven performance standards

Who are my internal customers and what are their needs

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Performer / Job LevelStandards (Accuracy, completeness, innovation, timeliness and cost) for

output must be based on quality and customer requirements.

Questions:What is required by the customer, both internal and

externalHow can requirements are measuredWhat is the specific standards for each level

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PRINCIPLES OF TOTAL QUALITY MANAGEMENT

TQM conveys a company-wide effort that includes all employees, suppliers, and customers, and that seeks to continuously improve the quality of products/services and processes to meet the needs and expectations of customers.

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Attributes to TQM• Customer focus (what)

• Commitment and Leadership (who)

• Strategic Planning (how)

• Continuous Improvement (when)

• Empowerment and Teamwork

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Attributes to TQM

IN A SMALL GROUP, DISCUSS THE ATTRIBUTES/ FEATURES OF TQM

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Customer Focus• Customer judge of quality

• Service package

• Customer relationship

• Internal customer

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Commitment and Leadership

• Long term commitment

• leadership for quality

• Organisation’s team TQM team leaders

• Overcome resistance to change

• Strong quality focus

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Strategic Planning?

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+ Environmental analysis

+ Company Vision

+ Determine corporate mission

+ Form a strategy:•Plan-Do-check-act•Critical success factors•Plan (milestone, person in charge, resources)•Review the cycle•Learning from the previous experience.

Continuous Improvement+ Enhancing value to the customer throughout

new and improve products and services

+ Reducing errors, defects and wastes

+ Improving responsiveness and cycle time performance

+ Improving productivity and effectiveness in use of all resources

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Empowerment and Teamwork?

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Focus on customer: 3 Classes of Customer

Needs~ Dissatisfiers : those needs that are

expected in a good or service

~ Satisfiers : needs that customers say they want

~ Delighters : new and improve features that customers do not expect

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Quality - “Gurus”

WHO IS QUALITY GURUS? HOW THEY DEFINE THE QUALITY?

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Learning from Quality Gurus: Quality Advocates

U.S. Quality Innovators: - Walter Shewhart - W. Edwards Deming - Joseph M. Juran - Armand V Feingenbaum - Philip Crosby (1980s)Japanese Quality Innovators: - Kaoru Ishikawa - Genichi Taguchi (1960s - 1980s)

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Walter A ShewhartWalter Andrew Shewhart (March 18, 1891 - March 11,

1967) an American Physicist, engineer and statistician,

sometimes known as the father of statistical quality control.Shewhart worked to advance the thinking at Bell Telephone Laboratories from their foundation in 1925 until his retirement in 1956, publishing a series of papers in the Bell System Technical Journal.

Pioneer of modern quality control:-recognized the need to separate variation into assignable

and unassignable causes (defined “in control”.)-“founder of the control chart” (e.g. X-bar and R chart).-originator of the plan-do-check-act cycle.63

-perhaps the first to successfully integrate statistics, engineering, and economics.-defined quality in terms of objective and subjective quality:

- objective quality: quality of a thing independent of people.- subjective quality: quality is relative to how people

perceive it. (value)

• His work was summarized in his book Economic Control of Quality of Manufactured Product (1931).Shewhart’s charts were adopted by the American Society for Testing and Material (ASTM) in 1933 and advocated to improve production during World War ll in American War Standards Z1.1-1941, Z1.2-1941 and Z1.3-1942.

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W. Edwards DemingWilliam Edwards Deming (October 14, 1900 – December 20,

1993) was an American Statistician, professor, author, lecturer and consultant.

He is perhaps best known for his work in Japan. Deming received a BSc in electrical engineering from the

University of Wyoming at Laramie(1921), a M.S. from the University of Colorado (1925), and a Ph.D from Yale University (1928). Both graduate degrees were in mathematics and physics.

From1950 onward, he taught top management how to improve design (and thus service), product quality, testing, and sales (the last through global markets) through various methods, including the application of statistical methods.

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Studied under Shewhart at Bell Laboratories.

• Contributions: – well known for helping Japanese companies apply Shewhart’s statistical process control.• Japanese scientists and engineers named the famed Deming Prize after him. It is bestowed on organizations that apply and achieve stringent quality-performance criteria. Main contribution is his Fourteen Points to Quality:

• create constancy of purpose.• cease dependence on inspection to improve quality• drive out fear and build employee trust.• seek long-term supplier relationship • eliminate numerical goals; substitute leadership (abolish annual rating or merit system).• eliminate slogans, exhortations, and work-force targets

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Major Tenets/view of Deming’s Philosophy

# Workers can only correct 15% of the quality problems.

The other 85% are management’s responsibility, because they are due to the system.

# The production system must be stable for quality to be realised. This can be tested with statistical process control charts.

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Major Tenets/ view of Deming’s Philosophy

# Quality is the continuous, incremental improvement of a stable system.

# Quality cannot be “inspected into products”;It must be “designed in through the products and process design.”

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# Teamwork and training in quality are critical weapons in striving for improvement.

Workers must have the right tools to monitor and improve quality.

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Major Tenets/ view of Deming’s Philosophy

Deming’s Profound Knowledge

4 parts:~ Appreciation for a System and theory of

Optimisation.

~ Some Knowledge of the theory of Variation.

~ Some theory of Knowledge.

~ Some theory of Psychology

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Joseph M. JuranContributions:

– also well-known for helping to improve Japanese quality.– directed most of his work at executives and the field of quality management.- developed the “Juran Trilogy” for managing quality: Quality planning, quality control, and quality

improvement.

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FeigenbaumDeveloped the concept of Total Quality Control.

System for managing the entire value-chain connecting supplier to customer.

His Three Steps to Quality are quality leadership, modern quality technology and organisational commitment.

“If you want to find out about your quality, go out and ask your customer.”

Quality control staff = Facilitators.

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Philip CrosbyQuality management advocate/ promoter, consultant,

and author.Quality is Free

The four absolutes of quality including:#1- quality is defined by conformance to requirements, not

“goodness”.#2 - system for causing quality is prevention not appraisal.#3 - performance standard is zero defects, not “that’s close

enough.”#4 - measurement of quality is the price of nonconformance,

not indexes.

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Kaoru IshikawaContributions:- Considered as Japan’s leading figure in the area of

TQM. His inspiration came from the work of Deming and

Juran, and to a lesser extend, Feingenbaum.Developed concept of true and substitute quality

characteristics -true characteristics are the customer’s view -substitute characteristics are the producer’s view -Degree of match between true and substitute ultimately determines customer satisfaction.

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• He is the originator of Fishbone Diagrams or Ishikawa diagrams which are now used world-wide in continuous improvement to represent cause - effect analysis.

• Advocate of the use of the 7 tools • Advanced the use of quality control circles,

QCC (worker quality teams). • Respect for humanity as a management

philosophy - full participation. • Cross-functional management.

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Genichi TaguchiContributions:Taguchi methods emphasize consistency of

performance and reduced variationQuality loss function (deviation from target is a loss to

society).Parameter design (robust engineering) which is an

application of Design of Experiments:Identify key variablesReduce variation on the important variablesOpen up tolerances on unimportant variables

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MALCOLM BALDRIGE NATIONAL QUALITY AWARD

The Baldrige National Quality Program and the associated award were established by the Malcolm Baldrige National Quality Improvement Act of 1987.

The program and award were named for Malcolm Baldrige, who served as United States Secretary of Commerce during the Reagan administration, from 1981 until Baldrige’s 1987 death in a rodeo accident.

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The Malcolm Baldrige National Quality Award recognizes U.S. organizations in the business, health care, education, and nonprofit sectors for performance excellence.

The Baldrige Award is the only formal recognition of the performance excellence of both public and private U.S. organizations given by the President of the United States.

It is administered by the Baldrige Performance Excellence Program, which is based at and managed by the National Institute of Standards and Technology (NIST),an agency of the U.S. Department of Commerce.

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THE MALCOLM BALDRIDGE NATIONAL QUALITY AWARD

* Simulate American companies to improve quality and productivity

* Recognise the achievements of those companies and set an example for others

* Establish guidelines and criteria for evaluating quality efforts

* Provide specific guidance for other American enterprises that wish to learn how to manage quality

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Criteria for winning the Award :

* Senior executive leadership

* Information and analysis

* Strategic quality planning

* Human resource development and management

* Management of process quality

* Quality and operational results

* Customer focus and satisfaction80

MALCOLM BALDRIGE AWARD RECIPIENTS

1988 – MOTOROLA INC., GLOBE METALLURGICAL INC. 1989 – XEROX CORP. 1990 – CADILLAC MOTOR CAR, IBM, FEDEX. 1991 – SOLECTRON CORP. 1992 – AT&T NETWORK SYSTEMS, TEXAS INST. 1993 – EASTMAN CHEMICAL 1994 – WAINWRIGHT CORP. 1995 – ARMSTRONG WORLD, CORNING TELECOM 1996 – ADAC LABS 1997 – 3M DENTAL PRODUCTS 1998 – BOEING 1999 – STMICROELECTRONICS 2000 – DANA CORP 2001 - CLARKE AMERICAN CHECKS, INCORPORATED, SAN ANTONIO; UNIVERSITY OF WISCONSIN 2002 - MOTOROLA INC., BRANCH-SMITH PRINTING DIVISION 2003 - MEDRAD, INC., BOEING AEROSPACE SUPPORT 2004 - THE BAMA COMPANIES, TEXAS NAMEPLATE COMPANY 2005 - SUNNY FRESH FOODS, INC., DYNMC DERMOTT PETROLEUM OPERATIONS.

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2006 - MESA PRODUCTS, INC., NORTH MISSISSIPPI MEDICAL CENTER

2007 - PRO-TEC COATING CO., MERCY HEALTH SYSTEM.

2008 - CARGILL CORN MILLING NORTH AMERICA, IREDELL-STATESVILLE SCHOOLS

2009 - HONEYWELL FEDERAL MANUFACTURING & TECHNOLOGIES, MIDWAY USA,

2010 - MEDRAD, NESTLÉ PURINA PETCARE CO, K&N MANAGEMENT

2011 - HENRY FORD HEALTH SYSTEM, CONCORDIA PUBLISHING HOUSE, SCHNECK MEDICAL CENTRE, SOUTH CENTRAL FOUNDATION

2012 - LOCKHEED MARTIN MISSILES and FIRE CONTROL Grand Prairie, Texas (manufacturing); MESA PRODUCTS INC (small business) Tulsa, Okla. ; NORTH MISSISSIPPI HEALTH SERVICES, Tupelo, Miss. (health care); CITY OF IRVING, Irving, Texas (nonprofit)

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MALCOLM BALDRIGE AWARD RECIPIENTS

Overview of theMalcolm Baldrige

National Quality Award(MBNQA)

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What is the MBNQA?MBNQA is a national quality award program, created to recognize organizations that:

– have outstanding processes/practices – practice measurable, continuous improvement – achieve customer-focused performance excellence

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MBNQA is a business reviewBusiness Review - Inspect what we Expect

A business review is a formal process for evaluating how an organization operates:

• Have we defined what business we are in? Is it what we excel at? Is it what the customer needs?

• Do we know who our competitors are, and what threatens our success?

• Do we have specific actions planned to become the best at what we do?

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• Have we aligned the actions of all our partners and vendors to ensure we are successful at our stated objectives?

• Do we have a work environment that promotes innovation, empowerment, and a quality of work life that will attract and retain the best talent available?

• Have we documented how we work (processes) so that we systematically meet customer needs?

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What does MBNQA look for?

Visionary Leadership Customer-driven excellence Organisation and personal learning Valuing employees and partners Agility/ Rapidly respond to change Focus on the future Managing for innovation Management by fact Social Responsibility Focus on results and creating value systems perspective

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What does MBNQA look for? Leadership Strategic Planning Customer Focus Aproach Deployment

Information/ Analysis Continuous Improvement (55%)

Workforce Processes Results (45%)

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• The Deming prize, established in December 1950 in honor of W. Edward Deming; originally designed to reward Japanese companies for major advances in quality management.

• Over the years it has grown, under the guidance of Japanese Union of Scientists and Engineers (JUSE) to where it is now also available to non-Japanese companies, usually operating in Japan, and also to individuals recognized as having made major contributions to the advancement of quality.

• Two categories of awards are made annually, the Deming Prize for Individuals and the Deming Application Prize.

Deming Prize

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Deming Prize CriteriaBroadly, the following considerations are taken into account for the Deming Application Prize:

•The emphasis of examination is on the implementation of TQM

•The actual implementation of TQM practices is appreciated

•Usage of advanced statistical methods is not the basisfor success; appreciation and implementation of statisticalmethodology are more important

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•Similar patterns of evaluation are adopted for both manufacturing and non-manufacturing companies

•Examination viewpoint criteria provides an overall picture of TQM.

•Examiners judge features that have been applied by the company.

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The Examination Viewpoint includes:• Top Management Leadership, Vision, Strategies

• TQM Frameworks

• Quality Assurance Systems

• Management Systems for Business Elements

• Human Resource Development

• Effective Utilisation of Information

• TQM Concepts and Values

• Scientific Methods

• Organisational Powers (Core Technology, Speed,

Vitality)

• Contribution to Realisation of Corporate Objectives93

Successful companies should score:

• 70 points or higher in the Executive Session

• 70 points or higher as the company average,excluding the Executive Session

• 50 points or higher for any examined unit of the company

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•Six Sigma is a business management strategy originally

developed by Motorola, USA in 1981. As of 2010, it enjoys

widespread application in many sectors of industry,

although its application is not without controversy.

•Six Sigma seeks to improve the quality of process outputs

by identifying and removing the causes of defects (errors)

and minimizing variability in manufacturing and business

process.

SIX SIGMA

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• It uses a set of quality management methods, including

statistical method, and creates a special infrastructure of

people within the organization ("Black Belts", "Green

Belts", etc.) who are experts in these methods.

• Each Six Sigma project carried out within an

organization follows a defined sequence of steps and has

quantified targets.

These targets can be financial (cost reduction or profit

increase) or whatever is critical to the customer of that

process (cycle time, safety, delivery, etc.).

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•The term six sigma originated from terminology

associated with manufacturing, specifically terms

associated with statistical modeling of manufacturing

processes.

• Originally, it referred to the ability of manufacturing

processes to produce a very high proportion of output

within specification.

•The maturity of a manufacturing process can be described

by a sigma rating indicating its yield, or the percentage of

defect-free products it creates.

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•A six-sigma process is one in which 99.99966% of the

products manufactured are free of defects, compared

to a one-sigma process in which only 31% are free of

defects.

•Motorola set a goal of "six sigmas" for all of its

manufacturing operations and this goal became a

byword for the management and engineering practices

used to achieve it.

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•Six Sigma is a registered service mark and trademark

of Motorola Inc. As of 2006 Motorola reported over

US$17 billion in savings from Six Sigma.

Other early adopters of Six Sigma who achieved well-

publicized success include Honeywell (previously

known as AlliedSignal) and General Electric, where

Jack Welch introduced the method.

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•By the late 1990s, about two-thirds of the Fortune

500 organizations had begun Six Sigma initiatives

with the aim of reducing costs and improving

quality.

•In recent years, some practitioners have

combined Six Sigma ideas with lean manufacturing

to yield a methodology named Lean Six Sigma.

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Origin and meaning of the term “six sigma process”

The term "six sigma process" comes from the notion

that if one has six standard deviations between the

process mean and the nearest specification limit, as

shown in the graph, practically no items will fail to

meet specifications. This is based on the calculation

method employed in process capability studies.

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•Capability studies measure the number of

standard deviations between the process mean and

the nearest specification limit in sigma units.

•As process standard deviation goes up, or the

mean of the process moves away from the center

of the tolerance, fewer standard deviations will fit

between the mean and the nearest specification

limit, decreasing the sigma number and increasing

the likelihood of items outside specification102102

Graph of the normal distribution, which underlies the statistical assumptions of the Six Sigma model. The Greek letter σ (sigma) marks the distance on the horizontal axis between the mean, µ, and the curve's inflection point. The greater this distance, the greater is the spread of values encountered. For the curve shown above, µ = 0 and σ = 1. The upper and lower specification limits (USL, LSL) are at a distance of 6σ from the mean. Because of the properties of the normal distribution, values lying that far away from the mean are extremely unlikely. Even if the mean were to move right or left by 1.5σ at some point in the future (1.5 sigma shift), there is still a good safety cushion. This is why Six Sigma aims to have processes where the mean is at least 6σ away from the nearest specification limit

Origin and meaning of the term "six sigma process"

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Methods•Six Sigma projects follow two project methodologies inspired

by Deming's Plan-Do-Check-Act (PDCA) Cycle.

•These methodologies, composed of five phases each, bear

the acronyms DMAIC and DMADV

• DMAIC is used for projects aimed at improving an existing

business process.

(Define-Measure-Analyze-Improve-Control)

• DMADV is used for projects aimed at creating new product

or process designs.

(Define-Measure-Analyze-Design-Verify)104104

DMAICThe DMAIC project methodology has five phases:

Define the problem, the voice of the customer, and the project goals, specifically.

Measure key aspects of the current process and collect relevant data.

Analyze the data to investigate and verify cause-and-effect relationships. Determine what the relationships are, and attempt to ensure that all factors have been considered. Seek out root cause of the defect under investigation.

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Improve or optimize the current process based upon data analysis using techniques such as design of experiments, poka yoke or mistake proofing, and standard work to create a new, future state process. Set up pilot runs to establish process capability.

Control the future state process to ensure that any deviations from target are corrected before they result in defects. Control systems are implemented such as statistical process control, production boards, and visual workplaces and the process is continuously monitored.

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DMADVThe DMADV project methodology, also known as DFSS ("Design For Six Sigma"), features five phases:

Define design goals that are consistent with customer demands and the enterprise strategy.

Measure and identify CTQs (characteristics that are Critical To Quality), product capabilities, production process capability, and risks.

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Analyze to develop and design alternatives, create a high-level design and evaluate design capability to select the best design.

Design details, optimize the design, and plan for design verification. This phase may require simulations.

Verify the design, set up pilot runs, implement the production process and hand it over to the process owner(s).

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Implementation roles•One key innovation of Six Sigma involves the

"professionalizing" of quality management functions.

Prior to Six Sigma, quality management in practice was

largely relegated to the production floor and to

statisticians in a separate quality department.

Formal Six Sigma programs borrow martial arts ranking

terminology to define a hierarchy (and career path) that

cuts across all business functions.

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Six Sigma identifies several key roles for its successful implementation.

Executive Leadership includes the CEO and other members of top management. They are responsible for setting up a vision for Six Sigma implementation. They also empower the other role holders with the freedom and resources to explore new ideas for breakthrough improvements.

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Champions take responsibility for Six Sigma implementation across the organization in an integrated manner. The Executive Leadership draws them from upper management. Champions also act as mentors to Black Belts.

Master Black Belts, identified by champions, act as in-house coaches on Six Sigma. They devote 100% of their time to Six Sigma. They assist champions and guide Black Belts and Green Belts. Apart from statistical tasks, they spend their time on ensuring consistent application of Six Sigma across various functions and departments.

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Black Belts operate under Master Black Belts to apply

Six Sigma methodology to specific projects.

They devote 100% of their time to Six Sigma.

They primarily focus on Six Sigma project execution,

whereas Champions and Master Black Belts focus on

identifying projects/functions for Six Sigma.

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Green Belts are the employees who take up Six Sigma implementation along with their other job responsibilities, operating under the guidance of Black Belts.

Some organizations use additional belt colours, such as Yellow Belts, for employees that have basic training in Six Sigma tools.

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TQM and Six SigmaThe Six Sigma process improvement originated in 1986 from Motorola’s drive towards reducing defects by minimizing variation in processes through metrics measurement.

Applications of the Six Sigma project execution methodology have since expanded to include practices common in Total Quality Management and Supply Chain Management, such as increasing customer satisfaction, and developing closer supplier relationships.

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The main difference between TQM and Six Sigma (a newer concept) is the approach.

TQM tries to improve quality by ensuring conformance to internal requirements, while Six Sigma focuses on improving quality by reducing the number of defects and impurities.

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The Quality Hierarchy

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Inspection

Quality Control

Quality Assurance

Total QualityManagement

Incorporates QA/QC activitiesinto company-wide system aimedat satisfying the customer

Actions to insure products orservices conform to companyrequirementsOperational techniques to makeinspection more efficient and toreduce the costs of quality.

Inspect products

Prevention

Detection

SPC

SQC

Current Practices

* 55% of US businesses use quality as a

performance indicator in 1991

* 70% of Japanese Businesses use quality as a

performance indicator in 1991

* 50% of Japanese businesses always translate

customer expectations in the design of new

products, compared to 40% in Germany and 22%

in US.117117

Cont’d

* Japanese businesses use technology twice as much as US businesses in meeting customer expectations.

* 47% of Japanese businesses always use process simplification compared to 22% of US businesses.

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* From about 1960 to 1990, the United States lost 40 percent of its market share to foreign competitors, while Japan increased its foreign market by 500 percent.

* For the Japanese, the secret to success was the implementation of systematic quality efforts to meet or exceed customer requirements and expectations the first time and every time. The three basic principles of TQM are to: focus on achieving customer satisfaction, seek continuous and longterm improvement in all the organization's processes and outputs, and take steps to ensure the full involvement of the entire work force in improving quality.

Cont’d

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