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QIAImproveQualityReduceCostProductivityImprovesCaptureMarketProvidesjobsandmorejobsModelsoftherelationshipsaffectingqualityandbusinessperformanceDeming’sModel:lessrework,lessscrapIncreasecycletime,increasethroughputbetterquality,lowerpriceOverallsocietybenefitsCOSTOFPOORQUALITY(COPQ)ExternalFailureCostsWarrantyAdjustmentsRepairsCustomerServiceReturnedGoodsReturnedRepairedGoodsProductRecallsProductLiabilitySuitsOpportunityCosts……………InternalFailureCostsScrapReworkRE-INSPECTIONofReworkDowngradingBecauseofDefectsLossesCausedbyVendorScrapDowntimeCausedbyDefectsFailureAnalysis……………..AppraisalCostsReceivingInspectionIn-processInspectionLaboratoryInspectionOutsideLaboratoryEndorsementsSetupforTestingMaintenanceofTestEquipmentQualityAuditsCalibrationofQualityEquipment………..PreventionCostsQualityEngineeringDesignandDevelopmentofQualityEquipmentDesignVerificationandReviewtoEvaluatetheQualityofNewProductsQualityTrainingQualityImprovementProjectsQualityDataGatheringAnalysisandReportingOtherProcessControlActivitiesUsedtoPreventDefects………………LostOpportunityScrapReworkInspectionWarrantyRejectsLostsalesLatedeliveryEngineeringchangeordersLongcycletimesExpeditingcostsExcessinventoryTheCostofPoorQuality(COPQ)“Iceberg”TraditionalQualityCostsAdditionalCostsofPoorQuality(intangible)(tangible)4-8%25-35%(EasilyIdentified)(Difficultorimpossibletomeasure)LostCustomerLoyaltyMoreSetupsSixSigmaPhilosophy

WeareinbusinesstomakemoneyWemakemoneybysatisfyingneedsWeareabletosatisfyneedsbydoingEveryneed/dopairisaninteractionTheaimofcustomerfocusisonimprovingneed/dointeractionRepetitionofthesameactionconstituteaprocessImproveourbusinessmeansimprovementofourprocessesCustomersneedproducts/serviceson-time,withzerodefects,withlowercostAsprocesscapabilityimproves,theproductqualityincreasesAsqualityincreases,costsandcycle-timegodown…………...Thereductionofdefects,cycle-time,costleadstoimprovedcustomersatisfactionAscustomersatisfactionimproves,thelikelihoodofdoingbusinessincreasesAsbusinessincreases,we(asindividualandsociety)growandprosperWhatisSixSigma?Sigmaisastatisticalunitofmeasurewhichreflectsprocesscapability.Thesigmascaleofmeasureisperfectlycorrelatedtosuchcharacteristicsasdefects-per-unit,partspermilliondefective(PPM),andaprobabilityofafailure/error.Thesigmavalueindicateshowoftendefectsarelikelytooccur.Thehigherthesigmavalue,thelesslikelyaprocesswillproducedefects.Assigmaincreases,costsgodown,cycletimegoesdown,andcustomersatisfactiongoesup.Whatisthemeaningofquality???99%Good(3.8Sigma)

99.9997%Good(6Sigma)20,000lostarticlesofmailperhour SevenarticlesofmaillostperhourUnsafedrinkingwaterforalmost Oneunsafeminuteeverysevenmonths15minuteseachday5,000incorrectsurgicaloperations 1.7incorrectoperationsperweekperweek2shortorlonglandingsatmostmajor oneshortorlonglandingeveryfiveairportseachday yearsateachairport200,000wrongdrugprescriptionsperyear 68wrongdrugprescriptionsperyearNoelectricityforsevenhourseachmonth Onehourwithoutelectricityevery 34yearsSixSigmaIs….SixSigmaisdisciplinedmethodologyforcontinuousimprovementforReducingprocessvariabilityandkeepingitreducedachievebenefitsfromimprovementsin:betterproduct/processqualityreducescarpandreworkreducecycletimebetterproduct/processdesignreducemajorexpansesAtoolsettomakethatchangepracticalEmpoweredpeoplehavethecontroltheyneedtoimprovethewaytheyworkAcommonlanguagefordiscussing,measuringandcomparingprocesscapabilitiesApowerfulcompetitiveadvantage……….-6

-5-4-3-2-1X+1

+2+3+4+5+6NormalDistributionShifted1.5

ProcessCapability(Sigma)

PPM

Yield 2 308,537 69% 3 66,807 93.3% 4 6,210 99.3% 5 233 99.98% 6 3.4 99.9997%

SigmaMeasures-Process

CapabilityPerformanceLevelSIGMA%Yield#ofDefectsperMillion(DPM)A+699.999663.4A599.9767233B499.37906,210C393.366,807D269308,537F131691,462GoodWorld-ClassAverageGoodWorld-ClassAverageCostofQuality%<1%ofsales5-15%ofsales15-25%ofsales25-40%ofsalesC93.366,8073EstablishorganizationalmeasurementsIdentifythesigmalevelEstablishCOPQmeasurementprocessIdentifythemajorareasforimprovement3to4sigmameans15%to25%costofsales:-Whichmeansifyoursalesis$100millions,youcansaveupto$25millionsbyimplementingSixSigmaprogram.ThesavingsiscontinuousbasisyearoveryearWhatistheBenefitsofSixSigma???OutputMeasurementFailurerate(internalandexternal)WarrantycostRepaircostperunitCycletimeperunitCycletimefornewproductdevelopment#ofengineeringchangesSupplierissuesWIPinventorycostFinishedgoodsinventoryDefectsproductarrivalatcustomer#ofserviceeventsLearnhowthecompanieslikeGeneralElectric,AlliedSignal,Motorola,LockheedMartin,AmericanExpress,J.P.Morgan&Chase,andothersuseSixSigmamethodologiestoreducedefects,improveprocesses,lowercost,higherprofit,increasecustomersatisfaction,anddriveimprovementtoanewlevels.“TheSixSigmaQualityinitiativeshasloweredGE’scostsbydramaticallyreducingrework,simplifyingprocesses,andreducingdirectmaterialcosts.Designforsixsigmahasbeenakeytotheintroductionofnumeroushigh-qualitynewproductswithsignificantlyenhancedfeatures.””JohnF.Welchjr.,GeneralelectricChairmanandChiefExecutiveOfficer,GEAnnualReport2000.bKnowledgeManagementKnowledgeManagementbBusinessResultsOpsReview,StrategyReviewLeadershipValues,Vision,MissionLearningandGrowthStrategyManagementBalancedScorecardProcessManagementCustomerManagementKnowledgeManagementQualityManagementQMSTheSixSigmaSystemCustomersRequirementsSatisfactionCustomersContinuousimprovementofthequalitymanagementsystemManagementresponsibilityResourcemanagementProductrealizationMeasurementanalysisandimprovementProductInputOutputSixSigmaProcessCustomerSatisfactionIncreaserevenueandprofitIncreasemarketshareDecreasecostQualityManagementSystemVSSixSigmaQualityManagementSystemSixSigmaSystemCustomerSatisfactionBusinessObjectivesBusinessStrategyProcessImprovementBusinessGovernanceModelDeliveryReturnRateWarranty$ProblemResolutionNewprodPerformanceCust.SurveyMfgQualitySupplierPerformanceRevenueCostProfitMarketShareGrowthBusinessResultsAssessmentPDPProductLCMSupplierDevelopmentPlanningMarketingCustomerServiceManufacturingISO/QS9000ProcessSixSigmaProcessQIASixSigmaImplementationModelUnderstandingofSixSigmaProcess(ExecutiveTraining)DefineBusinessStrategy(Values,Vision,Mission)AdoptSixSigmaProcessasLongTermBusinessStrategyforContinuousImprovement(QMSProcess)DevelopMeasurementsandGoals(BalancedScorecard)fortheBusinessGapAnalysis(Understandthestrength&weakness),AreasforImprovementDevelopBusinessGovernanceModeltoMonitorBusinessPerformanceDefineRoles&ResponsibilitiesforSixSigmaDeploymentDeveloptheRoadmapforSixSigmaProcessDeploymentIdentifyResourceRequirementsDevelopSixSigmaGovernanceProcessDevelopSixSigmaTrainingandCertificationprogram(SSL,MBB,BB,GB)IdentifyProjectsforImprovementsAssessBusinessPerformancerelatedtoSixSigmaProcess(QMSProcess)QIASixSigmaSixSigmaContinuousImprovementPrioritiesOverallfocuswill:DramaticallyreducetheCostofQualitybyimproving:processimprovementproductandserviceimprovementdesignimprovementsupplierimprovementtrainingDevelopandimplementasystematicapproachtodriveperformanceimprovementsthroughoutthebusinessMakeCustomerSatisfactionadrivingforceinallbusinessdecisionsImplementabalancedscorecardthatmeasuresthesuccessofoureffortsLeader/ChampionMasterBlackBelt(MBB)BlackBelts(BB)GreenBelts(GB)ProjectTeamMembersSixSigma-Roles&ResponsibilitiesIsresponsibleforcoordinatingabusinessroadmaptoachieve6.Selectsprojects,executescontrol,andalleviatesroadblocksforthe6projectsinhisorherareaofresponsibility.Ismentor,trainer,andcoachofBlackBeltsandothersintheorganization.Bringsthebroadorganizationuptotherequired6competencylevel.Isaleaderofteamsimplementingthe6methodologyonprojects.Introducesthemethodologyandtoolstoteammembersandthebroaderorganization.Deliverssuccessfulsmall,focuseddepartmentalprojectsusingthesuccessstrategy.Participatesontheprojectteams.Supportsthegoalsoftheproject,typicallyinthecontextofhisorherexistingresponsibilities.Isexpectedtocontinuetoutilizelearned6methodologyandtoolsaspartofhisorhernormaljob.QIAcanhelpyoutogrowyourbusinessbyintroducingyouaworldclassbusin

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