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Introduction of Six Sigma,Belton Group Rex Wong,Scope of Module,What is Six Sigma Why the need for Six Sigma How to apply Six Sigma,What is Six Sigma?,Six Sigma is a comprehensive and flexible system for achieving, sustaining and maximizing business success. It is uniquely driven by close understanding of customer needs, disciplined use of facts, data and statistical analysis, with diligent attention to managing, improving and reinventing business processes. Peter S Pande, Robert P Neuman, Roland R Cavanagh The Six Sigma Way (McGraw Hill, 2000),Six Sigma Is Three Things,A statistical measurement A business strategy A philosophy,1) Six Sigma A Statistical Measurement,It provides a quantitative performance assessment of our products, services and processes. It allows for comparisons against other similar or dissimilar products, services and processes. It provides feedback on how far ahead or behind we are.,Six Sigma helps to establish our course and to gauge our pace in the race for total customer satisfaction.,Six Sigma A business strategy,Improved Sigma-Rating of Process,Cost Of Poor Quality (COPQ),Lost Opportunity Hidden Factory,(Difficult or impossible to measure),COPQ is a function of Sigma Capability,Inspection Warranty Scrap Rework Rejects,More Setups Expediting Costs Lost sales Late Delivery Lost Customer Loyalty Excess Inventory Long Cycle-Times Engineering Change Orders,Cost Of Poor Quality (COPQ),3) Six Sigma A philosophy,Six Sigma is about working smarter, not harder. Discover and neutralize harmful sources of variation Mistakes are reduced (or eliminated) Improved process capability Sigma rating goes up,Quality Breakthrough,Why needs of Six Sigma?,The goal of Six Sigma is not to achieve six sigma levels of quality (i.e. 3.4 dpmo).,Six Sigma is about improving profitability; improved quality and efficiency are immediate by-products.,Six Sigma aggressive goal,Sigma is a statistical unit of measure that reflects process capability. The sigma scale of measure is perfectly correlated to such characteristics as defects-per-unit, parts-per million defective, and the probability of a failure/error.,PPM,Process Capability,Defects per Million Opp.,Six Sigma Process,m,Point of Inflection,1s,T,USL,p(d),1 2 3 4 5 6,s,Benefit of Six Sigma,Cost reduction Productivity improvement Market-share growth Customer retention Cycle-time reduction Defect reduction Culture change Product/service development,Profits,Customers Needs Internal Metrics,Delivery,Price,Quality,Customer,Supplier,Need,Cycle Time,Cost,Defects,Do,How to apply Six Sigma?,Unlike conventional improvement programs which focuses on improving the defects on the “output”, Six Sigma focuses on the “process” that creates or eliminates the defects. Six Sigma seeks to reduce variability in a process by means of a systematic approach called the Breakthrough Strategy.,Six Sigma approach,Identify the Customers Need,Center around the Target,Focus of Six Sigma?,The output (Y) is perceived as a function of the input (X).,Breakthrough Strategy,Breakthrough Strategy,Define,The Define phase sets the stage for a successful Six Sigma project by addressing the following questions:,What is the problem of our focus? Whats our goal? And by when? Whos the customer impacted? What are the CTXs in-concern? Whats the process under investigation?,Project Definition,Improve time to market for all products Lead the industry in key technologies Create world-class manufacturing processes Develop strategic supplier relationships Provide best-in-class product and process quality Develop strategic relationships with key customers Become an employer of choice,Baseline Metric Data,Baseline The average long-term defect level of a process when all input variables in the process are running in an unconstrained fashion. Entitlement The best-case short-term defect level of a process when all input variables in the process are centered and in-control. Benchmark The defect level of the process deemed by comparison to be the best process possible.,eg: best WinBench numbers against Maxtor, Fujitsu drives,Breakthrough Improvement,Cost of Quality,Hard Savings Potential Savings Soft Savings,Measure,The Measure phase serves to validate or refine the problem, and to begin the search for root causes. It addresses,the focus and extent of the problem, based on measures of the process, the key data required to narrow the problem to its major factors or vital few root causes.,Capability Analysis Conventional Metrics,Reject Rate in percent (e.g. 7.4%) in ratio (e.g. 0.074) in parts per million (e.g. 74,000 DPPM) Yield in first-time yield in final yield,Capability Analysis,Defect per unit (DPU),Defects Per Unit : The average number of defects per unit produced.,Defect Rate = # Defects / # Units = 7 / 5 = 1.4 dpu,Defects Per Million Opportunities (DPMO),Opportunities : The number of possibilities for defect creation in any unit of product process or sequence of processes.,1. Arm Height 2. Arm thickness 3. Bore hole Dia 4. Swgae hole Dia 5. Roughness 6. Teardrop profile 7. Roll 8. Pitch,Number of Opportunities = Opportunities per Unit Number of Units = 8 5 = 40 Defect Rate = # Defects / # Opportunities = (7 / 40 ) 106 = 175,000 dpmo,DPMO vs Sigma Capability,First-time yield (Yft),First-Time Yield is the number of units that pass a particular inspection, compared with the total number of units that pass through that point in the process.,First-Time Yield, Yft = 968 / 1000 = 0.968,Throughput yield (Ytp),Throughput Yield is the probability that a unit of product or service will pass through a given process step error-free. Throughput Yield, Ytp = eDPU,(40 Defects),Throughput Yield, Ytp = e-(40/1000) = 0.961,Final Yield (Yf),Process A,Process B,Process C,Final Yield, Yf = Quantity Shipped / Quantity Built = 800 / 1,000 = 0.80,A shortcoming of final yield is that it fails to consider the “hidden factory” or rework. Hidden Factory : ad hoc systems and processes set up to correct errors made during the mainstream process.,Rolled Throughput Yield (Yrp),Rolled Throughput Yield = Ytp(A) Ytp(B) Ytp(C) = 0.7408 0.6393 0.5824 = 0.2758,Process A,50,Scrap,Rework,200,150,Process B,800,Input (950),25,Scrap,Rework,300,275,Process C,650,Input(925),125,Scrap,Rework,250,125,Defects = 300 Ytp(A) = e300/1,000 = 0.7408,Defects = 425 Ytp(B) = e425/950 = 0.6393,Defects = 500 Ytp(C) = e500/925 = 0.5824,Defects= 300,Rolled Throughput Yield (Yrp),The rolled throughput yield is the probability that a unit of product or service is able to pass through the entire process defect-free. It is a function of the defect rate, and hence provides a better estimate of the amount of rework required. Rolled throughput yield can be improved by having higher throughput yields at each process step reducing the number of process steps,Sigma Value,Sigma Value (Z- Score): The sigma value is derived from the probability of a defect in a process and is used to compare performance across products or processes z-Score is most accurately determined by using the equation of z = e(-DPU),Analyze,In the Analyze phase, practical business problems are turned into statistical problems. The statistical tools and the order in which they are applied will depend on the problem and process, and the approach to the problem.,Improve,The Improve phase seeks to address the following:,What possible actions or ideas required to address the root cause of the problem, and to achieve the goal? Which of the ideas are workable potential solutions? Which solution will most likely achieve the goal with the least cost or disruption? How can the chosen solution be tested for effectiveness, and then implemented permanently,Control,In the Control phase, actions are established to ensure that the process is monitored continuously for consistency in quality of the product or service.,Implement ongoing measures and actions to sustain improvement,Realization,In the Realize phase, ownership of the project is transferred to the finance representative, for tracking of financial benefits of the project.,Champion,Define the path for Six Sigma implementation across the organization. Careful selection of high-impact projects. Support development of “statistical thinking”. Realize the gains by supporting Six Sigma projects through allocation of resources and removal of roadblocks. Implementation of Black Belt recommendations. Ensure that project opportunities are acted upon by the organizations leadership and the finance department. Recognition of efforts and contributions by the people.,Black Belt,Act as Breakthrough Strategy experts and enthusiasts. Identify the barriers. Management of project: from planning, through execution, to realization. Report progress to appropriate leadership levels. Determine the most effective tools to apply. Gather input from knowledgeable sources, from operators to managers. Green Belt Training Monitor & provide guidance of Green Belt projects.,Green Belt,Function as Green Belt

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