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1、Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,IX,CUSTOMER&COMPETITIVE INTELLIGENCE,FOR SYSTEMS INNOVATION&DESIGN,S,IGMA,S,DEPARTMENT OF STATISTICS,DR.RICK EDGEMAN,PROFESSOR&CHAIR SIX SIGMA BLACK BELT,REDGEMANUIDAHO.EDU O
2、FFICE:+1-208-885-4410,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,IX,S,IGMA,S,DEPARTMENT OF STATISTICS,Introduction to Six Sigma,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignD
3、r.Rick L.Edgeman,University of Idaho,IX,S,IGMA,S,DEPARTMENT OF STATISTICS,a highly structured strategy for acquiring,assessing,and applying customer,competitor,and enterprise intelligence for the purposes of product,system or enterprise innovation and design.,Client,Enterprise&Competitive Intelligen
4、ce for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,“Often,problems are knots with many strands,and looking at those strands can make a problem seem different.”Mr.Rogers,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick
5、L.Edgeman,University of Idaho,a highly structured strategy for acquiring,assessing,and applying customer,competitor,and enterprise intelligence for the purposes of product,system or enterprise innovation and design.Innovation AlgorithmDMAIC(Define-Measure-Analyze-Improve-Control)Design for Six Sigma
6、 AlgorithmDMADV(Define-Measure-Analyze-Design-Verify)Makes Integrative Use Of:Various strategies and tools from Statistics,Quality,Business,Engineering and?,is,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Six Sigma Orga
7、nizations,GE All 300,000+GE employees must be Six Sigma certified.All new GE products developed using the“Design for Six Sigma”(DFSS)approach.3M New CEO(from GE)requires all 3M employees to become Six Sigma certified.DupontAlliedSignalSun MicrosystemsRaytheonMotorolaBoeingLockheed-MartinBank-of-Amer
8、icaAmerican ExpressHSBCSAS Institute,Rapidly Increasing Areas of Application.Healthcare GE Heathcare-SLCFinancial,Military NSWC,Pentagon,etc.Fueled by:Strategic Contexts.Notorious bottom-line orientation&results.Adaptable to multiple bottom lines.Process orientation:rigorous and systematic approache
9、s to innovation and design.Focus on the customer.Successful track record elsewhere.“Industry Buzz”.,While Six Sigma is new at,for example,3M its benefits at others ofthese organizations is measured in the multi-billions of US dollars.,Client,Enterprise&Competitive Intelligence for Product,Process&Sy
10、stems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Quality is a state in which value entitlement is realized for the customer and provider in every aspect of the business relationship.Business Quality is highest when the costs are at the absolute lowest for both the producer&consumer.Six S
11、igma provides maximum value to companies in the forms of increased profits and maximum value to consumers with high-quality products and services at the lowest possible cost.,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho
12、,TheVillain,Cost of Poorly Performing Processes s level DPMO CP32308,537 Not Applicable366,807 25%-40%of sales46,210 15%-25%of sales5233 5%-15%of sales63.4 1%of salesEach sigma shift provides a 10%net income improvement,Cost of Poorly Performing Processes(CP3),Sigma(s)is a measure of“perfection”rela
13、ting to process performance capability the“bigger the better.”A processoperating at a“Six Sigma”level produces only 3.4 defects per million opportunities(DPMO)for a defect.Without dedication of significant and appropriate attention to a process,most processes in leading companies operate at a level
14、between 3 and 4 sigma.,Why is Six Sigma Important?,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Cost of Poorly Performing Processes,The cost to deliver a quality product can account for as much as 40%of the sales price.
15、For example,a laser jet printer purchased for$1,000 may have cost the manufacturer$400 in rework just to make sure that you took home an average-quality product.For a company whose annual revenues are$100 million and whose operating income is$10 million,the cost of quality is roughly 25%of the opera
16、ting revenue,or$25 million.If this same company could reduce its cost of achieving quality by 20%,it would increase its operating revenue by$5 million or 50%of the current operating income.,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,Univ
17、ersity of Idaho,and the Hero,We dont know what we dont know.We cant do what we dont know.We wont know until we measure.We dont measure what we dont value.We dont value what we dont measure.Typical Results:companies that properly implement Six Sigma have seen profit margins grow 20%year after year fo
18、r each sigma shift(up to about 4.8s to 5.0s.Since most companies start at about 3s,virtually each employee trained in Six Sigma will return on average$230,000 per project to the bottom line until the company reaches 4.7s.After that,the cost savings are not as dramatic.However,improved profit margins
19、 allow companies to create products&services with added features and functions that result in greater market share.,What Does Six Sigma Tell Us?,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Six Sigma Affects Six Areas F
20、undamental to Improving a Companys Value:Process ImprovementProduct&Service ImprovementInvestor RelationsDesign MethodologySupplier ImprovementTraining&Recruitment,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Six Sigma
21、vs.TQM,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Values of Six Sigma Organizations,Issue Classical FocusSix Sigma FocusAnalytical Perspective point estimatevariabilityManagement cost&timequality&timeManufacturability
22、trial&errorrobust designVariable Search one-factor-at-a-timedesign of experimentsProcess Adjustmenttweakingprocess control chartsProblems fixingpreventionProblem solving expert basedsystem basedAnalysis experiencedataFocus productprocessBehaviorreactiveproactiveSupplierscostrelative capabilityReason
23、ing experience basedstatistically basedOutlook short-termlong-termDecision Making intuitionprobabilityApproachsymptomaticproblematicDesign performanceproducibility,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Values of
24、Six Sigma Organizations,Issue Classical FocusSix Sigma FocusAim companycustomerOrganization authoritylearningTrainingluxurynecessityChain-of-commandhierarchyempowered teamsDirectionseat-of-the-pantsbenchmarking/metricsGoal settingrealistic perceptionreach out&stretchPeople costassetControl centraliz
25、edlocalizedImprovement automationoptimization,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,The SIPOC Model,Suppliers,Customers,Inputs,Outputs,ProcessSteps,Inform Loop,Client,Enterprise&Competitive Intelligence for Produ
26、ct,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Six Sigma COPIS Model,Customers,Suppliers,Outputs,Inputs,ProcessSteps,The Voice of the Customer(VOC)is aggressively sought and rigorously evaluated and used to determine needed outputs and hence the optimal process configurati
27、on needed to yield those outputs and their necessary inputs for which the best suppliers are identified and allied with.From Concept to Market:the Voice of the Customer,How does Six Sigma Work?,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,
28、University of Idaho,The DMAIC Model,Define,Control,Measure,Improve,Analyze,Voice of the Customer,Institutionalization,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Kano Customer Need Model,Client,Enterprise&Competitive I
29、ntelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Kano Customer Need Model,Delighted,Disgusted,Absent,FullyImplemented,Stakeholder Satisfaction,TIME,Degree ofExecution,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&Desig
30、nDr.Rick L.Edgeman,University of Idaho,Dimensions of Quality-Garvins Eight,Quality is usually a bundle of characteristics We need to disaggregate this composite notionThis decomposition will help us to make our notion of quality more precisemake comparisons possiblefacilitate measurementOnly the cus
31、tomer determines the relative importance of these dimensions,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Garvins Eight Dimensions,Performance FeaturesConformanceAesthetics,ReliabilityDurabilityServiceabilityPerceived Q
32、uality,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,What the Terms Mean(1),PERFORMANCE Primary operating characteristics of a productFEATURES bells&whistles secondary characteristics that supplement the basic functionin
33、gCONFORMANCEdegree to which product meets pre-established standards(meeting specs),Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,What the Terms Mean(2),RELIABILITYProbability of product remaining functional over a specif
34、ied period of timeDURABILITY amount of use one gets out of a product before it physically deterioratesSERVICEABILITYspeed and ease of repairs(or resolution of problems),Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,What
35、the Terms Mean(3),ASTHETICSlook,feel,and sound of a product reflects individual preferencesPERCEIVED QUALITY perceptions of quality based on other cues and indirect measuresreputation or affiliation often key,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.
36、Rick L.Edgeman,University of Idaho,Competing on Quality,It is not often feasible to pursue all 8 dimensions Trade-offs are necessaryQuality niches can be defined and defendedA firm can define what quality means for its productMust focus on the right quality measure:those one(s)that matter to the con
37、sumer,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Dimensions of Service Quality,RELIABILITY:consistency,error-free dependabilityRESPONSIVENESS:willingness to help the customerTANGIBLES:environment for the service prese
38、ntedCOMPETENCE:the right skills and knowledge required,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Service Quality(cont.),COURTESY:suppliers behaviorSECURITY:freedom from danger or riskACCESS:ease of making contactCOMM
39、UNICATION:understandable to the customerEMPATHY:adopting the customers viewpoint,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Aggregation,Often need to reduce the number of dimensions.Reduced list is:ReliabilityResponsi
40、venessEmpathyTangiblesAssurance,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Six Sigma Road Map:R DMAIC SIBreakthrough StageStrategy Phase Objective IdentificationRecognize Identify Key BusinessDefine Issues Characteriz
41、ationMeasure Understand CurrentAnalyze Performance Levels OptimizationImprove Achieve BreakthroughControl Improvement InstitutionalizationStandardize Transform How Day-toIntegrate Day Business is Conducted,Breakthrough Strategy,Black Belt Projects,Client,Enterprise&Competitive Intelligence for Produ
42、ct,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Define,Control,Improve,Analyze,Measure,Six Sigma Innovation&the DMAIC Algorithm,Define the problem and customerrequirements.Measure defect rates and documentthe process in its current incarnation.Analyze process data and deter
43、minethe capability of the process.Improve the process and removedefect causes.Control process performance andensure that defects do not recur.,“Common sense”doesnt mean“commonly done”or when done,done well.,Six Sigma:How Do We Innovate?,Client,Enterprise&Competitive Intelligence for Product,Process&
44、Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Six Sigma from the GE PerspectiveSix Sigma is a highly disciplined process that helps a company focus on developingand delivering near-perfect products and services.Why“sigma”?The word is astatistical term that measures how far a given p
45、rocess deviates from perfection.The central idea behind Six Sigma is that if you can measure how many“defects”you have in a process,you can systematically determine how toeliminate those and approach“zero defects”.Six Sigma has changed the DNA at GE it is the way that GE works inEverything that GE d
46、oes and in every product GE designs.“What is Six Sigma?The Roadmap to Customer Improvement”,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Design for Six Sigma Applications of Six Sigma that focus on the design or signifi
47、cantredesign of products and services and their enabling processes so thatfrom the beginning customer needs and expectations are fulfilledare known as Design for Six Sigma or DFSS.The focal aim of DFSS is to create designs that are resource efficient,capable of exceptionally high yields,and are robu
48、st to processvariations.This aim leads to the DFSS algorithmDefine-Measure-Analyze-Design-Verify(DMADV).,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Define,Verify,Design,Analyze,Measure,Design for Six Sigma(DFSS),All n
49、ew products at GE are designed using a DFSS algorithm.,Define customer requirements andgoals for the process,product or service.Measure and match performance to customer requirements.Analyze and assess the design for the process,product or service.Design and implement the array of new processes requ
50、ired for the new process,product or service.Verify results and maintain performance.,Six Sigma:How Do We Design?,Client,Enterprise&Competitive Intelligence for Product,Process&Systems Innovation&DesignDr.Rick L.Edgeman,University of Idaho,Design for Six Sigma at GE:DFSS is changing GE.With it GE can
