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Six Sigma can be defined as a methodology to manage process variations that cause defects – defined as unacceptable deviations from the mean or target – and to work systematically toward managing variation to eliminate these defects. The objective of Six Sigma is the delivery of the best in performance, reliability and value to the end customer.
Six Sigma was pioneered at Motorola in 1986. Originally, it was defined as a metric for measuring defects and improving quality, and a methodology to reduce defect levels below 3.4 defects per million. Six Sigma is a registered service mark and trademark of Motorola, Inc. To date, Motorola has reported over $17 billion savings from Six Sigma.
General Electric became one of the early adopters of Six Sigma and has achieved excellent results. During the first year it implemented Six Sigma, GE reported benefits of over $300 million. Because of their success, GE has played a vital role in popularizing Six Sigma. Other large organizations that have benefited from Six Sigma implementation include Ford, Caterpillar, Microsoft, Raytheon, Quest Diagnostics, Seagate Technology, Siemens, Merrill Lynch, Lear, and 3M.
Though it started in manufacturing, Six Sigma is now widely used across a wide range of industries, including banking, business process outsourcing, telecommunications, insurance, construction, healthcare, and software.
Methodology
Six Sigma has two key methodologies – DMAIC and DMADV. DMAIC – Define, Measure, Analyze, Improve, Control – is used to improve existing processes. DMADV – Define, Measure, Analyze, Design, Verify – is used to create new product or process designs.
Roles Required for Implementation
Six Sigma identifies five key roles for its implementation:
Executive Leadership
Champions
Master Black Belts
Black Belts
Green Belts
Specific training programs exist for each of these roles.
Key Tools
Six Sigma employs a variety of tools, many of them mathematical – usually statistical – in nature. Amongst these are:
Failure Modes Effects Analysis
Cost Benefit Analysis
Customer Output, Process Input Supplier Maps
Process Maps
Run Charts
Histograms
Stratification
Cause & Effect (Fishbone or Ishikawa) Diagrams
Homogeneity of Variance
ANOVA
Chi-Square Tests of Independence and Fits
General Linear Models
Regression Analysis
Correlation
Design of Experiments
Taguchi Methods Control Charts
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