Six Sigma Black Belt
Introduction
Home
Six Sigma Black Belt | Introduction Introduction: Home
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Course Introduction
Six Sigma Black Belt | Introduction Concept: Course Introduction
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Welcome to the American Society for Quality (ASQ) Six Sigma Black Belt (SSBB) certification preparatory course. This is the first step in your journey to Six Sigma Black Belt certification.
This course will cover the following topics:
• Enterprise-wide deployment • Business process management • Project management • Define • Measure • Analyze • Improve • Control • Lean enterprise • Design for Six Sigma
Becoming an SSBB empowers you to make a difference in your organization. Six Sigma’s focus on customer
satisfaction and operational excellence brings a new level of business credibility to your role as a quality expert. As a Black Belt, you will be relied upon as one of the leaders in your organization’s quality movement.
ASQ Overview
Six Sigma Black Belt | Introduction Concept: ASQ Overview
The American Society for Quality (ASQ) is the world's leading authority on quality. With more than 100,000 individual and organizational members, this professional association advances learning, quality improvement and knowledge exchange to improve business results and create better workplaces and communities worldwide. As champion of the quality movement, ASQ offers technologies, concepts, tools and training to quality professionals, quality practitioners and everyday consumers, encouraging all to Make Good Great™.
ASQ is grateful for the contributions and dedication of subject matter experts who provided their assistance in the development and design of this course.
This course is based on the ASQ Six Sigma Black Belt Body of Knowledge. To download a copy of the Body of Knowledge, roll over Page Resources at the bottom of this page.
Course Overview
Six Sigma Black Belt | Introduction Concept: Course Overview
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Six Sigma Black Belt
Enterprise-Wide Deployment
Lesson Introduction
Six Sigma Black Belt | Enterprise-Wide Deployment Introduction: Lesson Introduction
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The nature of a Six Sigma project is enterprise-wide. Particularly for companies beginning down the Six Sigma path, the investigation of which projects will be deployed based on data analysis often leads to activities that will affect the entire organization. To begin this journey, an enterprise-wide view will be established. To better understand this view and deploy a project of this magnitude, the ASQ Body of Knowledge provides the following topics:
Enterprise view
• Understand the organizational value of Six Sigma and its philosophy, goals and definition.
• Understand and distinguish interrelationships between business systems and processes.
• Describe how process inputs, outputs and feedback of the system impact the enterprise system as a whole.
Leadership
• Understand leadership roles in the deployment of Six Sigma.
• Understand the roles and responsibilities of Black Belts, Master Black Belts, Green Belts, Champions, Executives and Process Owners.
Organizational goals and objectives • Understand key drivers for business. • Understand key metrics and scorecards.
• Describe the project selection process including knowing when to use Six Sigma improvement methodology as opposed to other problem-solving tools, and confirm link back to organizational goals.
• Document the objectives achieved and manage the lessons learned to identify additional opportunities.
Organizational improvement and Six Sigma foundations history
Lesson Overview
Six Sigma Black Belt | Enterprise-Wide Deployment Introduction: Lesson Overview
The tools and objectives of the Enterprise-Wide Deployment lesson are illustrated below.
Six Sigma Black Belt
Enterprise-Wide Deployment
Learning Objectives
Six Sigma Black Belt | Enterprise-Wide Deployment | Enterprise View Concept: Learning Objectives
At the end of this Enterprise-Wide Deployment topic, all learners will be able to: • understand the organizational value of Six Sigma, its philosophy, goals and
definition.
• understand and distinguish interrelationships between business systems and processes.
• describe how process inputs, outputs and feedback of the system impact the entire enterprise system as a whole.
Portions of this topic were taken from the ASQ Six Sigma Green Belt web-based Certification Preparation Course.
Why Use Six Sigma
Six Sigma Black Belt | Enterprise-Wide Deployment | Enterprise View Concept: Why Use Six Sigma
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Depending on whom you ask, Six Sigma may be referred to as a philosophy, a methodology or a tool. In Donald W. Benbow and T.M. Kubiak's The Certified Six Sigma Black Belt Handbook, it is defined as "a fact-based, data-driven philosophy of improvement that values defect prevention over defect detection."
The term “Six Sigma” is a measure of quality. Sigma (σ) is a Greek letter used by statisticians to show the variation in a process. For example, if a hospital process for admitting a new patient is supposed to take five to ten minutes, a variation occurs not only when it takes more or less time but also for each mistake that is made in
collecting the patient's information.
If the hospital is operating at 4 sigma (4σ), there may be as many as 6,000 problems per million opportunities for a mistake. For example, if a patient admission form has 50 questions, for every 20,000 patients admitted there could be 6,000 errors in the information.
In a Six Sigma (6σ) environment, the standard for variability is reduced to 3.4 problems per million opportunities. Moving from 6,000 data errors at 4σ to just 3.4 data errors at 6σ is real progress!
Imagine bringing this concept to life in your own home. The image below shows how your home would be affected if the power company ran at 4σ vs. 6σ:
Philosophy and Goals
Six Sigma Black Belt | Enterprise-Wide Deployment | Enterprise View Concept: Philosophy and Goals
The philosophy of Six Sigma goes beyond the reduction of errors in a single
department.
Six Sigma is a business initiative, not a quality initiative. It is a way of doing business that improves quality and productivity, increases competitiveness and reduces cost. There are three major components to Six Sigma:
• Culture of the organization • Improvement tools
• Support systems for the tools By controlling the amount of variation beyond the upper and lower allowable limits of a process, one minimizes the frequency of out of control conditions. In real terms, building Six Sigma into a way of doing business can reduce errors, identify and correct flaws in processes and have a dramatic impact on the success of the organization.
Business Systems and Processes
Six Sigma Black Belt | Enterprise-Wide Deployment | Enterprise View Concept: Business Systems and Processes
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Understanding the mindset of business is crucial to the success of any quality project. In this topic you will gain an understanding of and distinguish interrelationships between business systems and processes. Systems and processes and the
relationships that define them will be first discussed and then applied to business. The American Heritage Dictionary defines system as “a group of interacting, interrelated, or interdependent elements forming a complex whole." The ASQ Glossary defines system as "a group of interdependent processes and people that together perform a common mission."
This latter definition highlights an important aspect of systems, namely that a system operates in unity toward a unified purpose. Without a true understanding of a system's purpose, elements and interdependencies, it is difficult to know what improvements would truly benefit the system as a whole, rather than benefiting only one of its elements at the possible expense of others.
System Example
Six Sigma Black Belt | Enterprise-Wide Deployment | Enterprise View Concept: System Example
To understand a system, go no further than your computer. The personal computer (PC) exemplifies a system by providing desired functionality to the user via its monitor, keyboard, mouse, software, hard drive, processor and other peripherals. Each of these PC components is an independent member of the PC system, and each interrelated module “works together” in unity toward a purpose set by the user. Many other systems exist in nature that allow an understanding of this interrelation concept. In this example, the various elements mentioned would be considered subsystems of the greater PC system, as seen from the perspective of the PC as a whole. If you were to focus your attention on just the mouse, the PC subsystem could be considered a system on its own, its elements being the left button, the right button, the navigation wheel, the casing and the cord.
Knowledge check
• What is another example of a system in nature? • What are its elements?
System Functions
Six Sigma Black Belt | Enterprise-Wide Deployment | Enterprise View Concept: System Functions
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The American Heritage Dictionary defines function as “the action for which a person or thing is particularly fitted or employed.” For a system is to fulfill its purpose, one or more actions must occur. Thus, the functions of a system are those associated actions that allow a system to work as a unit toward its stated purpose.
In the PC example, think about how multiple functions must work together to open an email program. To oversimplify the functions, when a user drags the mouse, an electronic signal must transmit the action of the mouse moving into a related motion recognizable to the user. The monitor allows the user to see this motion and the software and signal work together to display the cursor moving on the screen. Working in harmony, the user drags the cursor over the program icon and
double-clicks the left mouse button. This transmits the instruction to the software: open the email program.
To fully document this simple action across all subsystems within the PC would take volumes if you went to the deepest levels. To diagram the opening email example:
Example Concept
The Personal Computer System
is made up of a monitor, keyboard, mouse, software and other hardware Subsystems/Elements which function together to allow the user to open email software Unified Purpose by executing the process of navigating and opening the program. Process
Processes
Six Sigma Black Belt | Enterprise-Wide Deployment | Enterprise View Concept: Processes
Process is defined by The American Heritage Dictionary as “a series of actions, changes, or functions bringing about a result.”
For an experienced computer user, moving the mouse is a simple step, an action that is commonplace. For an inexperienced user this could be a more complicated process until he or she becomes acclimated to using the mouse. For a multidisciplined engineer studying the mouse in order to create a new model and replicate its features and functions, moving the mouse could be seen as a very complicated process. Each process, as outlined above, will share the following elements that affect its function:
• inputs • process • outputs
Applying a Systems View to Business
Six Sigma Black Belt | Enterprise-Wide Deployment | Enterprise View Concept: Applying a Systems View to Business
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Now that the groundwork for the concepts has been established, how does this translate into designing a quality project for a business?
Say, for example, that a business considers the following its core functions: • Sales • Marketing • Engineering • Production • Customer Service
Functional Processes
Six Sigma Black Belt | Enterprise-Wide Deployment | Enterprise View Concept: Functional Processes
Each of these core functions has its own set of defined processes, which that particular department uses to accomplish its goals.
Support Functions
Six Sigma Black Belt | Enterprise-Wide Deployment | Enterprise View Concept: Support Functions
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The business also has various functions that support the core functions. These include: • Human Resources
• Finance
• Information Technology (IT) • Warehousing
At this point, the analysis of the business system looks vertical. Individuals inside a particular functional area have full view of their own process but have difficulty seeing outside of these “silos” except when they intersect with another functional area. For example, an intersection between functional areas occurs when a tracking system managed by the Information Technology support function is used by the Warehousing support function to deliver a product to a customer (internal or external). This limited perspective is why it is crucial to understand the business processes that cut across these functional process areas.
Business Process View
Six Sigma Black Belt | Enterprise-Wide Deployment | Enterprise View Concept: Business Process View
A business process is a collection of related activities that produce something of value to the organization, its stakeholders or its customers.
Examples of business processes throughout an organization can be defined as follows: • Quote-to-cash
• Procure-to-pay
• New product/service development • Order fulfillment
Becoming familiar with cross-functional business processes greatly increases
understanding of the interrelationships between the core functions and clarifies how a quality project in one area of the company will affect other areas. To truly grasp the system, however, we must consider another aspect of the business process: its purpose.
Managing the Purpose
Six Sigma Black Belt | Enterprise-Wide Deployment | Enterprise View Concept: Managing the Purpose
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No business process can be effective unless its purpose is properly communicated to the rank-and-file. Executive leadership should drive management of the business purpose, and impress upon all members of the organization the importance of understanding and fulfilling that purpose. In addition, leadership must govern, manage, adjust and reset the purpose based on customer needs and other factors.
Process Impact on the Organization
Six Sigma Black Belt | Enterprise-Wide Deployment | Enterprise View Concept: Process Impact on the Organization
The Six Sigma methodology recognizes that there are many input, output and feedback sources for an organization. Each output may have its own process dependent on the input from other processes. All inputs and outputs of a particular process should be measurable so that quality can be controlled.
Suppliers, Inputs, Process, Outputs and Customers (SIPOC) is a tool that can be used to help identify these processes in an organization. Although this course will discuss SIPOC in more detail later, it is important to know that improvements in one area may create errors in another.
Six Sigma Black Belt
Enterprise-Wide Deployment
Learning Objectives
Six Sigma Black Belt | Enterprise-Wide Deployment | Leadership Concept: Learning Objectives
At the end of this Enterprise-Wide Deployment topic, all learners will be able to: • understand leadership roles in the deployment of Six Sigma (e.g., resources,
organizational structure).
• understand the roles and responsibilities of Black Belts, Master Black Belts, Green Belts, Champions, Executives and Process Owners.
Portions of this topic were taken from the ASQ Six Sigma Green Belt web-based Certification Preparation Course.
Enterprise Leadership
Six Sigma Black Belt | Enterprise-Wide Deployment | Leadership Concept: Enterprise Leadership
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Successfully implementing Six Sigma methodologies within an organization requires the commitment of the company's top leadership. Six Sigma focuses on
cross-functional and enterprise-wide processes. Therefore, leadership and support from the executive staff, specifically the CEO, is crucial. Without this support and leadership, the Six Sigma initiative will fail.
An important leadership role within a Six Sigma project is the project Champion. According to Kim H. Pries in Six Sigma for the Next Millennium, the Champion: "
...is specifically tasked with the responsibility of planning the deployment of the Six Sigma process...[and] must understand the following:
• Skills required • Data needed
• Financial requirements (budgeting) • Specific people tied to the skills
• Locations (meeting rooms, plant floor, and so on)
• Tools or equipment (projectors, computers, ancillary tools, and so on) "
Stakeholders
Six Sigma Black Belt | Enterprise-Wide Deployment | Leadership Concept: Stakeholders
In addition to their tactical qualifications, Champions and executive leadership must have a firm grasp of the company's stakeholders. A stakeholder is anyone who has an interest in the business. This broad group includes but is not limited to:
• Investors • Customers • Vendors • Employees • Employees' families • Neighboring communities
• Local, city and federal government
Each stakeholder has different interests based on the stakeholder's relationship to the business. Identifying the overt and underlying interests of a stakeholder provides guidance on how a particular Six Sigma may positively or adversely affect them. Note: More detail on stakeholders may be found in the Business Process Management lesson.
Allocating Resources
Six Sigma Black Belt | Enterprise-Wide Deployment | Leadership Concept: Allocating Resources
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Effective Six Sigma projects cannot happen without the appropriate decision makers taking ownership of the project. The project Champion as well as the group(s) funding the project must stay involved from the beginning and through completion. Working with the project Champion, the company leadership must provide resources in the form of personnel and funds to accomplish the project.
Staffing support
Once the project is defined and the appropriate types of roles and skill sets are identified, specific personnel will be chosen to fulfill each role. During the selection process, leadership may find that those resources most needed are often the busiest. These resources cannot justify participation in the project unless its level of
importance is appropriately elevated. Depending on workload, other individuals may be needed to backfill the work of someone dedicated to the Six Sigma project (Project roles will be discussed in more detail later in the course.)
If Six Sigma is new to the organization, leadership must provide training in "the ways of Six Sigma," since use of these processes will affect each team member's
performance on the project.
Other resources
In addition to staffing dedication, the Champion must coordinate acquisition of other resources needed for the project, which could include:
• Software • Hardware
• Additional workspace (additional phone, Ethernet and wireless connectivity support)
• Additional meeting space • Meeting room supplies • Office supplies
The magnitude of these resource requirements will depend, of course, on the size and length of the project.
Six Sigma Roles and Responsibilities
Six Sigma Black Belt | Enterprise-Wide Deployment | Leadership Concept: Six Sigma Roles and Responsibilities
In Implementing Six Sigma, Forrest Breyfogle outlines the following roles and responsibilities within a Six Sigma infrastructure:
• Champion
• Master Black Belt • Black Belt • Green Belt • Process Owner
Again, depending on the organization, there may not be an individual to fill every role. In those cases, someone in another role must accept those responsibilities.
Roll over Page Resources and select Six Sigma Roles and Responsibilities to view a chart of specific responsibilities per role.
Six Sigma Hierarchy
Six Sigma Black Belt | Enterprise-Wide Deployment | Leadership Concept: Six Sigma Hierarchy
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Historically, one of the unique features of a Six Sigma project is its associated organizational structure. By announcing a structure with designated roles, the company leadership and employees further declare their dedication to the project. In practical terms, a well-defined structure strengthens accountability and increases the project's chance of success.
An example of a Six Sigma hierarchy is shown below. Keep in mind that every organization is different. Depending on the size of the organization or even the size of the project, the roles shown below may not be filled in the same manner.
Six Sigma Black Belt
Enterprise-Wide Deployment
Learning Objectives
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: Learning Objectives
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At the end of this Enterprise-Wide Deployment topic, all learners will be able to: • understand key drivers for business, metrics and scorecards.
• describe the project selection process including knowing when to use Six Sigma improvement methodology (DMAIC) as opposed to other problem-solving tools and confirm the link back to organizational goals.
• describe the purpose and benefit of strategic risk analysis (e.g., strengths,
weaknesses, opportunities, threats (SWOT), scenario planning) including the risk of optimizing elements in a project or process resulting in suboptimizing the whole.
• document the objectives achieved and manage the lessons learned to identify additional opportunities.
Portions of this topic were taken from the ASQ Six Sigma Green Belt web-based Certification Preparation Course.
Key Business Drivers
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: Key Business Drivers
In his book Insights to Performance Excellence 2006, Mark Blazey defines “key” as “the major or most important elements or factors, those that are critical to achieving the intended outcome…those that are most important to the organization’s success. They are the essential elements for pursuing or monitoring a desired outcome.” Defining the specific drivers of a particular business, then determining a performance target for the resulting business objects, is key to continued success. These drivers are determined by understanding the nature of the business at large, as well as the market forces driving the business.
For example, the key business drivers for banks inside of grocery stores could include: • Existing store site population
• Existing store site capability
• Store expansion or plans to accommodate bank • New grocery store growth
• Bank inclusion in new store plans
• Performance feedback from existing sites
Each driver has a degree of influence on continued growth for this specific banking business.
Key Business Drivers
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: Key Business Drivers
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Suppliers strive for performance on internal metrics (e.g., cycle time, cost or defects) to meet customers’ increasing expectations on external metrics (e.g., delivery, price or quality).
The following key drivers taken from the hospital example (used earlier in this lesson) are common to most businesses and allow management to gather data for comparison with competitors.
Profit - An advantageous gain or return; a benefit. Hospital system profitability depends on managing costs down while increasing the efficiency and effectiveness of billing insurance payers.
Market share - The proportion of industry sales of a good or service that is controlled by a single company. Our hospital system controls less than 20% of the market and that market share is decreasing due to a poor reputation for customer service. Customer satisfaction - Meeting and/or exceeding customers' spoken or unspoken needs and requirements as fast as possible with the lowest possible cost to the customer (i.e., offering consistent performance, on-time delivery, lower costs, etc.). Customers want the right prescriptions, shorter wait times in the various clinics and emergency room, and improved accessibility to services.
Efficiency - A measure of desirability (i.e., improving availability, usability, features, design, etc.). Customers in the hospital system do not want to spend time filling out lengthy and repetitive forms. Patients do not want to lay on a gurney in a hallway after surgery waiting for a room to become available.
Product differentiation - In marketing, product differentiation is the modification of a product to make it more attractive to the target market. This involves differentiating your product from competitors' products (i.e., creating robust designs, meeting customer requirements, increasing process and material capabilities, etc.). For a hospital system, the COO wants to find a way to distinguish the hospital's products and services from its competitors. This could be done by building a reputation for being focused on the patient, improving the availability of new advanced procedures and improving access to care.
Metrics Introduction
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: Metrics Introduction
Metrics are an integral part of an organization's strategic planning and deployment. Metrics are numerical, and therefore quantifiable, measurements. They serve two valuable purposes: 1) assisting with organizational goal setting and 2) evaluating actual performance versus plan.
According to Kim Pries in Six Sigma for the Next Millennium, examples of business metrics may include:
"
• Return on investment (ROI) • Return on equity (ROE) • Return on assets (ROA) • Net present value (NPV) • Payback time
• Internal rate of return (IRR) • Economic value-added (EVA) "
Pries also asserts that each enterprise will define its own key metrics to indicate the health of the business, however some metrics are more commonly used than others. For example, "cost of goods sold" is a standard division of a balance sheet within the Generally Accepted Accounting Practice (GAAP), and will therefore be found in the key metrics toolbox of many businesses.
In general, "good" metrics will have the following characteristics: • Are customer centered
• Measure performance across time • Provide direct information
• Are linked with organizational goals
Metrics Classified
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: Metrics Classified
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Metrics belong to one of two broad categories:
Customer-related and competitive performance metrics include:
• Gains or losses of customers and market share • Survey results
• Percent of competitive awards received per applications submitted • Recognition and ratings
• Certifications by customers • Customer complaints • Benchmark results
Operational improvement and financial performance quality metrics
include:
• Defect levels • Margin rates
• Operating profit rates • Innovation rates • Time to market
• Environmental or safety results • Cycle time
• Lead time • Setup time
Linking Projects to Organizational Goals
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: Linking Projects to Organizational Goals
Project Champions face many challenges when introducing a new project to an organization. In situations where past projects fell short of their expected results, there may be considerable skepticism within the organization toward "another improvement project." This “historical project baggage” can result when these earlier project efforts took place in isolation, the silo mentality mentioned earlier. While one functional area may have been improved, not as many overall gains were achieved and sometimes other functional areas were negatively affected. Each improvement may have focused on a specific part of the business, and in the process ignored other departments. To combat skepticism and encourage a belief in the process, Six Sigma projects use metrics to make more comprehensive, company-wide improvements:
• Improving product quality • Increasing service level • Reducing cost (overall) • Reducing cycle time (overall)
Projects of this scope demand a link to organizational goals. The cross-functional business processes affected by these projects result in sweeping positive changes across the organization. It is important to note that not every project should be a Six Sigma project.
An organizational strategy drives the organization in the right direction and serves as a basis for project selection. Many processes are available to develop and drive
organizational strategy, but for the purpose of this course, we will focus on two: • Balanced Scorecard
• Malcolm Baldrige National Quality Award (MBNQA) 2006 Criteria for Performance Excellence
Balanced Scorecard
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: Balanced Scorecard
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The balanced scorecard (BSC) is a strategic measurement and management system that translates an organization’s strategy into four perspectives:
1. Financial: To achieve financial success, “How should we appear to our shareholders?”
2. Customer: To achieve our vision, “How should we appear to our customers?” 3. Internal business processes: To achieve shareholder and customer satisfaction,
“What business processes must we excel at?”
4. Learning and growth: To achieve our vision, “How will we sustain our ability to change and improve?”
Robert Kaplan and David Norton created the BSC to move organizations away from focusing solely on financial data and toward balancing consideration of financial data with the creation of abilities and intangible assets required for long-term growth. To achieve this balance, the BSC translates an organization’s strategy into specific measures in each category.
Note: Although BSC is not in the SSBB Body of Knowledge, it is a widely-accepted approach to establishing an organizational strategy.
Baldrige Award Criteria
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Task: Baldrige Award Criteria
In his book Insights to Performance Excellence 2006, Blazey states the "requirements for the Strategic Planning Category (MBNQA 2006 Criteria for Performance
Excellence) are intended to encourage strategic thinking and acting – to develop a basis for achieving and maintaining a competitive position.” Click strategy development and strategy deployment to learn about sample elements considered during the Strategic Planning Category (MBNQA 2006 Criteria for Performance Excellence).
Strategy Development
According to Blazey in Insights to Performance Excellence 2006, "
sample elements considered during strategic planning include the following: • Customers: market requirements and evolving expectations and opportunities. • Competitive environment and capabilities relative to competitors: industry and
market.
• Technologies and other innovations that might affect products and services, and future business operations.
• Internal strengths and weaknesses, including human resource capabilities and need, resource availability, and operational capabilities and needs.
• Financial, societal, ethical, regulatory, and other potential risks that may affect business success.
• Opportunities to redirect resources to higher-priority products, services, or business areas.
• Changes in economic conditions (local, national, or global) that might affect the business.
• Unique organizational factors such as supplier and supply chain, capabilities, and needs.
• Clear strategic objectives with timetables that help leaders determine where the organization should be at given points in time so they can effectively monitor progress.
"
Strategy Deployment
Key Components
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: Key Components
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Once the organizational strategy has been established, it is time to implement a process system that aligns with the organization's strategic goals and objectives. All levels, from strategic to tactical, must be involved to truly understand the system's impact on the customer. A successful Six Sigma deployment depends on the project evolving systematically. Roll over each component of Six Sigma deployment below to learn more.
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Project Selection Checklist
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: Project Selection Checklist
Careful project selection is key to the success of the Six Sigma quality initiative. Each industry and organization will have its own guidelines for deploying Six Sigma methodology. One approach to the dissemination of the Six Sigma culture is quality leaders (Master Black Belts, Black Belts, and the organizational leader) selecting projects that have the greatest impact on organizational goals.
The following is an example of the type of criteria used to select Black Belt projects:
As discussed in the Business Process Management lesson, project selection criteria are customer driven and align with the company's strategic goals and objectives. An example of this customer driven goal would be to increase customer satisfaction scores or decrease customer wait time.
Strategic Risk Considerations
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: Strategic Risk Considerations
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As discussed by Breyfogle in Implementing Six Sigma, differentiating between strategic and tactical planning is crucial. Strategic planning leads to "doing the right things"; while tactical planning leads to "doing things right." Strategic planning typically refers to a timeframe of three to five years, while tactical planning is more near-term in scope.
To understand what the "right things" are, the method of choice is strategic risk assessment.
Breyfogle further asserts that "with this strategic risk analysis, organizations can leverage the strength of the organization, improve any weakness, exploit opportunities and minimize potential impact of threats. Through this risk assessment organizations can then optimize their system as a whole."
Once strategic risks are identified and, when possible, quantified, they can be used to determine the long-term strategic plan for the organization. The long-term plan is then broken down into strategic goals and subgoals, from which annual goals are created. Selection of projects may then be made based on each projects ability to meet these annual goals.
When analyzing strategic risk, focus on the "big picture." A system should be thought of as the set of processes that makes up an enterprise. According to The Certified Six Sigma Black Belt Handbook by Benbow and Kubiak, when improvements are proposed, it is important to take a systems approach. Consideration should be given to the effect the proposed changes will have on other processes within the system and by association on the enterprise itself. Operating a system at less than its best mode is called suboptimization. Changes in a system may optimize individual processes but suboptimize the system as a whole.
Suboptimization Example
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: Suboptimization Example
When optimizing a system, remember that optimization is not just a local issue. Local optimization may actually have a negative impact on global optimization. The
following is an example of local suboptimization.
Example
The training department at ABC Corporation decided to "go paperless" by emailing course confirmations instead of sending a printed confirmation through interoffice mail. This new process would allow the department to cut down on paper and printer usage, as well as mail sorting time by the mail room staff. However, not all associates at ABC Corporation have access to email. Therefore, there is still a need to print some paper confirmations for those individuals. What the training department thought would save time and resources actually created two processes from one. The trainer now spends time looking up the name of each class participant in the company's global email address book. If the class participant is in the email system, then he or she receives an email confirmation. If a class participant does not have email, then a paper copy of the confirmation is mailed. In this example, paper use, copy machine wear and tear and mail room workload were reduced. However, an additional process was added thus creating more administrative work for the training department staff, resulting in time lost on other training projects. The net result is a waste of resources and an adverse effect on profits.
Scenario Planning and FMEA
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: Scenario Planning and FMEA
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Risk assessment uses several tools. We will consider three: scenario planning, FMEA and SWOT analysis.
Scenario planning
Pioneered by the Royal Dutch/Shell petroleum company and distribution network, scenario planning involves constructing a scenario by drawing on current events, demographic trends and other statistics to compose a "story" describing possible sequences of events leading to a specific result (Kim Pries, Six Sigma for the Next Millennium).
Pries states: "
Typically, scenario planning groups will develop at least four scenarios: • Pessimistic
• Moderate but pessimistic • Moderate but optimistic • Optimistic
"
Pries also notes that scenario planning serves "not so much to predict the future as to open the minds of planners and executive management to options and opportunities in the future." With scenario planning, risks that would otherwise never be considered can be uncovered, assessed and anticipated. The military has used scenario planning extensively.
Failure mode effects analysis (FMEA)
According to the ASQ Glossary, failure mode effects analysis (FMEA) is a procedure that analyzes each potential failure point (or "mode") in every subitem of an item to determine the failure point's effect on each subitem and on the required function of the item itself. FMEA is used to determine high-risk process activities or product features based on the effect of a failure and the likelihood that a failure could occur without detection. In other words, FMEA is a systematic problem-prevention tool. Typically used during the analyze phase of DMAIC to prioritize process activities or product features prone to failure, FMEA can also be used during the improve phase of DMAIC or design phase of DFSS to identify high-risk process activities or product features in the proposed improvement.
SWOT
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: SWOT
The Strengths, Weaknesses, Opportunities, and Threats (SWOT) analysis provides a framework to identify elements that help or hinder an organization. While the SWOT is an effective tool to identify risk, remember that it does not quantify potential risks. A SWOT analysis has internal and external components. Strengths and weaknesses are considered part of an internal analysis of the organization, while opportunities and threats are part of an external analysis of the environment in which the organization operates. The external environment is essentially everything outside of an organization that might affect the organization.
Strengths
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: Strengths
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To identify organizational strengths, answer the question "What are the skills, capabilities and core competencies that help an organization achieve its goals and objectives?" In other words, "What is the organization really good at?"
Organizational strengths might be any of the following: • Leadership
• Research and development efforts • Innovative product designs • Breakthrough technology • Teamwork
• Product development • Product assembly • Distribution channels
One or more strengths can provide a competitive advantage and help an organization differentiate itself in the marketplace. For example, if a company is exceptional at research and development, the company might concentrate efforts and resources in that area to build or strengthen a competitive advantage. Conversely, spreading resources too thin across too many areas can weaken an organization's competitive stance.
Every organization has distinct strengths. However, some organizations enter markets they do not belong in, produce products or services for which they lack expertise, or attempt to manage operations they do not understand. This does not mean an
organization should never venture into new areas, but the organization should have a realistic understanding of what it will take to succeed.
Weaknesses
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: Weaknesses
Identifying organizational weaknesses answers the question "What skills, capabilities and competencies are lacking that prevent the organization from fully achieving its goals and objectives?" For example, an organization may discover that it has
insufficient customer listening posts to support the desired level of customer service. Weaknesses are often considered opportunities for improvement. Any of the examples of strengths previously listed could become weaknesses.
Given a deficiency, an organization generally has three choices: • Modify the goal and objective into something achievable
• Invest the necessary capital to acquire the knowledge or skill required • Find another organization that has the expertise needed and outsource that
requirement or develop an alliance
It is common for organizations to readily identify strengths but struggle with weaknesses. However, weaknesses must be identified and addressed before an organization can plan for and achieve the performance levels necessary to meet its goals and objectives.
Opportunities
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Opportunities are generally described as those events and trends that help an organization grow to new levels. Opportunities are everywhere and are seen through changes in technology, government policy, and social patterns, to name a few. An opportunity could be found in a major situation or key trend present in the firm's business environment, or through identification of a previously overlooked market segment, changes in competitive or regulatory circumstances, technological changes or improved buyer-supplier relationships.
Other examples of opportunities include: • New technologies
• New markets for products or services • A collaborative partnership
• Reduced labor costs through offshore resources • Increased customer relations through CRM technology • Increased product awareness through marketing
Threats
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: Threats
Threats are barriers to an organization's growth that put the organization at a competitive disadvantage. No one likes to think about threats, but they must be addressed, even when they are external factors out of our control. It is vital to be prepared to face threats, especially during turbulent times.
A threat is a major unfavorable situation in a firm’s environment. Threats are key impediments to the firm’s current or desired position. The entrance of new competitors, slow market growth, increased bargaining power of key buyers or suppliers, technological changes and new or revised regulations could represent threats to a firm’s success. Other examples might include:
• Legal or regulatory issues • A new competitor
• Changing demographics • A weakening economy • Tax increases
• Introduction of new taxes • Dwindling workforce
Managing Lessons Learned
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A Six Sigma project generates a wealth of information. Establishing a process to capture, document and share lessons learned infuses change in the organization. In the Quality Progress article, “Planning for Knowledge Management,” William Shockley discusses documenting for knowledge management purposes what an organization learns from processes and projects. Shockley recommends asking and documenting the answers to the following questions:
• What went well?
• What could have been done differently? • What could be improved?
• What did we do that we should not have?
• Did all our various departments interact efficiently and effectively? • Where were there gaps?
• Where were there overlaps?
• What can be done differently next time to make the situation easier for all parties involved?
Documentation from lessons learned aids in continued improvement and identification of additional opportunities by:
• enabling others to learn how the project was planned, implemented, and monitored.
• helping resolve issues.
• allowing resources to be tracked back to their work in the project. • creating an audit trail.
Closed-Loop Assessment
Six Sigma Black Belt | Enterprise-Wide Deployment | Organizational Goals and Objectives Concept: Closed-Loop Assessment
Once lessons learned are documented, they should be integrated into a process that ensures their implementation on future projects and within other parts of the organization. One approach is through a closed-loop assessment, where this type feedback enters into a process that will result in action. Consider the illustration below:
In the context of this discussion, the terms above could be understood as follows: • Assessment: The results of the lessons learned, perhaps as a part of the project
final report.
• Reporting: Delivery of the lessons learned to the appropriate group within the organization. (e.g., the project steering committee).
• Remediation: Actions taken by the group in response to the lessons learned. These include corrective action and input for future projects.
Organizations should establish a project repository or database to maintain records of projects completed and to provide a reference for future projects. Project repositories help to translate improvements and lessons learned to other processes within the organization.
Six Sigma Black Belt
Enterprise-Wide Deployment
Learning Objectives
Six Sigma Black Belt | Enterprise-Wide Deployment | Org. Improvement and Six Sigma Foundations History Concept: Learning Objectives
At the end of this Enterprise-Wide Deployment topic, all learners will be able to understand the origin of continuous improvement tools used in Six Sigma (e.g., Deming, Juran, Shewhart, Ishikawa, Taguchi).
Portions of this topic were taken from the ASQ Foundations in Quality Learning Series: Certified Manager of Quality/Organizational Excellence.
History of Six Sigma
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The quality movement can trace its roots to medieval Europe, where, in the late 13th century, craftsmen began organizing into unions called "guilds". Six Sigma's role as a measurement standard has its ancestry in the 1800s introduction of Carl Frederick Gauss' concept of the normal curve. The harbinger of Six Sigma's measurement standard in product variation came about in the 1920's when Walter Shewhart showed that three sigma from the mean is the point where a process requires correction.
1940s The U.S. Military, dependent upon product quality and consistency to support the war effort, becomes the primary proponent of quality. Inspection and sampling techniques are implemented and improved upon, and processes redesigned to increase production efficiency. Statistical quality control is an emerging quality approach.
1950s Following World War II, the quality revolution in Japan spurs the birth of total quality in the United States. The Japanese welcome the input of Americans Joseph M. Juran and W. Edwards Deming, and rather than concentrating on inspection, focus on improving all organizational processes at the worker level. Juran facilitates the move from statistical quality control (SQC) to total quality control (TQC) in Japan.
1970s Japan’s high quality products steadily steal market share from U.S. industries. The U.S. response, emphasizing not only statistics but approaches that embraced the entire organization, becomes known as total quality management (TQM).
1980s Six Sigma begins in 1986 as a statistically-based method to reduce defects in production processes at Motorola Inc. By the late 80s, it extends to critical business processes.
1990s In 1991 Motorola certifies its first 'Black Belt' Six Sigma experts, signifying the formalization of the accredited training of Six Sigma methods. In the same year, Allied Signal becomes the second to adopt Six Sigma, followed by GE in 1995.
2000s New quality systems evolve from the foundations of Deming, Juran and the early Japanese practitioners of quality. Quality moves beyond manufacturing into service, healthcare, education and government sectors.
Adapted from The History of Quality, by the American Society for Quality; and Quality Assurance and Reliability in the Japanese Electronics Industry, World Technology Evaluation Center.
We will now discuss these Quality Pioneers and their approaches in more detail.
Origins of Continuous Improvement
Six Sigma Black Belt | Enterprise-Wide Deployment | Org. Improvement and Six Sigma Foundations History Concept: Origins of Continuous Improvement
Six Sigma contains a broad collection of concepts and tools used to discover organizational defects and their remedies. Each of these tools was pioneered by one person, who developed a particular facet of the quality effort, then tested and proved it to be useful to the global community. In this topic, we will discuss seven of the men behind the tools of Six Sigma and offer perspective on the tools any Black Belt will encounter and likely put to use.
Philip B. Crosby
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Philip B. Crosby (1926-2001) is
considered the business person of quality. He was one of ITT’s first vice presidents of corporate quality, and gained
prominence in the quality field after publishing Quality Is Free in 1979. Subsequently, he founded Philip Crosby Associates, a quality management consulting firm, and the Quality College, an institute that provides quality training for top management.
One of Crosby’s major contributions was making quality meaningful and accessible to American executives. He promoted addressing quality problems through existing management and organizational structures rather than from a statistical basis.
Crosby Four Absolutes
Six Sigma Black Belt | Enterprise-Wide Deployment | Org. Improvement and Six Sigma Foundations History Task: Crosby Four Absolutes
In Crosby's quality philosophy, the “four absolutes of quality management" are designed to answer the following questions:
What is quality?
Quality has to be defined as conformance to requirements, not as "goodness." Management’s job is to establish the requirements, supply the wherewithal, and encourage and help employees get the job done. The basis of this policy is
DIRFT—“Do It Right the First Time.” Requirements for quality must be thoroughly understood and accepted.
What system is needed to cause quality?
The system for causing quality is prevention, not appraisal.
The first step toward defect and error prevention is to understand the process
responsible for creating the product. When a defect occurs, discovery and elimination are the top priorities. Prevention is a knowledge issue for quality-focused workers. What performance standard should be used?
The performance standard must be zero defects, not “that’s close enough.” The only performance standard that makes sense for DIRFT is zero defects. Zero defects must be a performance standard of everyone in the company, from top management to line workers.
What measurement system is required?
The measurement of quality is the price of nonconformance, not indexes. A dollar figure can be established for the cost of quality (COQ) by determining the difference between the price of nonconformance (PONC) and the price of
conformance (POC). PONC is the expense of doing things the wrong way and can account for 20% to 35% of revenues. POC is the expense of doing things
right—typically 3% to 4%. COQ is not a standard to be met. Managers should spend time identifying where it occurs and address what makes it occur.
Crosby 14 Steps
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Crosby also offered a guide to the implementation process. These steps were republished in ASQ’s Quality Progress (December 2005), adapted from Crosby’s Quality Is Free: The Art of Making Quality Certain. The steps are designed to help individuals and organizations understand the long-term effort needed and to persevere through the necessary change in order to receive the resultant benefits of quality improvement.
1. Management commitment: Management must understand and then commit to quality improvement. Then management must garner the commitment of each individual to live a work life of conforming to requirements and/or have the requirements updated to reflect true customer needs.
2. Quality improvement team: A quality team representing the entire company is needed to enable and guide the improvement process decisively.
3. Quality measurement: Bring the entire company under the some form of measurement. Measurement allows management to assess progress and determine improvement targets.
4. Cost of quality evaluation: Organizations must identify the COQ in a formal and objective manner and then feed the identified costs into the regular management process.
5. Quality awareness: People need to know about the organization’s quality policy, management’s commitment to quality and the costs of poor quality.
6. Corrective action: Corrective action is required to identify and eliminate problems.
7. Establish an ad hoc committee for the zero defects program: Form a subcommittee (from the original quality improvement team or other involved employees) to understand zero defects conceptually and determine how to apply the concepts specifically within the organization. Begin planning and working the plan as the company moves toward “Zero Defects Day” (Step 9)
8. Supervisor training: Provide training to all levels of supervisors with the expectation that they will understand the program well enough to teach it to their employees.
9. Zero defects day: On "zero defects day," management makes a commitment to quality in front of the entire organization and emphasizes that the entire
organization must abide by it.
10. Goal setting: While zero defects are the ultimate goal, individual groups should identify interim goals that are made public to the rest of the organization. 11. Error cause removal: Organizations should ask employees to describe the
problems they have so that something can be done about them.
12. Recognition: Organizations should develop a recognition program for all employees, from executives to line workers.
13. Quality councils: Quality professionals should come together periodically and learn from each other.
14. Do it over again: By learning, watching, and participating, quality improvement teams can find ways to continue the quality improvement process.
W. Edwards Deming
Six Sigma Black Belt | Enterprise-Wide Deployment | Org. Improvement and Six Sigma Foundations History Concept: W. Edwards Deming
Dr. W. Edwards Deming (1900-1993) is widely credited with starting the modern quality improvement movement. He introduced statistical methods to American industry during World War II, but these were largely abandoned after the war. Later, in the early 1950s, Deming introduced his statistical methods to the Japanese. The Japanese embraced Deming and his quality philosophy, ultimately naming the country’s quality prize after him.
According to Deming, good quality does not necessarily mean high quality. A
predictable degree of uniformity and dependability is suited to the market at low cost, such that quality is whatever the customer needs and wants.
Deming’s quality management principles support a process-oriented approach to the production of goods and services:
• Teach process improvement as the path to increased quality and performance. • Acknowledge the workers’ expertise and involve them in continuous process
improvement (CPI).
• Understand variation using statistical analysis.
Overall, Deming emphasized that the key to quality is in management’s hands: 95% of quality problems are due to the system, while only 5% are due to employees.
Deming and The 14 Points
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The basis of Deming’s philosophy is a list of objectives he called “the 14 points for Management.” These are requirements for a business whose management plans to remain competitive, producing goods and services that will have a suitable market. Points 1 through 5:
1. Create constancy of purpose.
Create constancy of purpose toward improvement of products and services with the aim of becoming competitive, staying in business, and providing jobs.
2. Adopt the new philosophy.
We are in a new economic age. Western management must awaken to the challenge, learn their responsibilities and take on leadership for change.
3. Cease dependence on inspection.
Eliminate the need for inspection on a mass basis by building quality into the product from the beginning.
4. End the practice of awarding business on the basis of price tag.
Instead, minimize the total cost. Move toward a single supplier for any one item, based on a long-term relationship of loyalty and trust.
5. Improve constantly and forever.
Make constant improvement part of the system of production and service, and you will experience a constant decrease in costs.
Deming and The 14 Points Cont.
Six Sigma Black Belt | Enterprise-Wide Deployment | Org. Improvement and Six Sigma Foundations History Task: Deming and The 14 Points Cont.
The basis of Deming’s philosophy is a list of objectives he called “the 14 points.” These are requirements for a business whose management plans to remain competitive producing goods and services that will have a suitable market.
Points 6 through 10: 6. Institute training. Institute training on the job.
7. Institute leadership (see Point 12).
Institute leadership to help people and machines and gadgets do a better job. Leadership in management is in need of an overhaul, not just the leadership of production workers.
8. Drive out fear.
Eliminate fear, so everyone will work effectively for the company. 9. Break down barriers.
Break down barriers between departments. People in research, design, sales, and production must work as a team to foresee problems of production and usage that may be encountered with the product and service.
10. Eliminate slogans, exhortations, and targets for the workforce.
Eliminate slogans, exhortations, and targets for the workforce asking for zero defects and new levels of productivity.
Deming and The 14 Points Cont.
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The basis of Deming’s philosophy is a list of objectives he called “the 14 points.” These are requirements for a business whose management plans to remain competitive producing goods and services that will have a suitable market.
Points 11 through 14:
11. Eliminate work standards; eliminate management by objective. Substitute leadership for work standards (quotas) on the factory floor.
Substitute leadership for management by objective. Eliminate management by numbers, numerical goals.
12. Remove barriers that rob employees of the right to pride of workmanship. Remove barriers that rob the hourly worker of the right to pride of workmanship. The responsibility of supervisors must be changed from sheer numbers to quality.
Remove barriers that rob people in management and engineering of their right to pride of workmanship. This means “inter-alias,” abolishment of the annual or merit rating, management by objective or management by numbers.
13. Institute a vigorous program of education.
Institute a vigorous program of education and self-improvement.
14. Put everybody in the company to work to accomplish the transformation. The transformation is everybody’s job.
Dr. Armand V. Feigenbaum
Six Sigma Black Belt | Enterprise-Wide Deployment | Org. Improvement and Six Sigma Foundations History Concept: Dr. Armand V. Feigenbaum
Dr. Armand V. Feigenbaum (1920- ) is generally credited with developing the concept of “total quality control” during the late 1940s while an employee of General Electric. In the late 1960s, he started his own company, the General Systems Company, to provide consulting services for quality management and strategic planning. Feigenbaum placed major emphasis on the need for total quality control in order to achieve productivity, market penetration, and competitive advantage.
In his book Total Quality Control, Feigenbaum defines total quality control as “an effective system for integrating the quality-development,
quality-maintenance, and
quality-improvement efforts of the various groups in an organization so as to enable marketing, engineering, production, and service at the most economical levels which allow for full customer satisfaction.”
Feigenbaum Four Fundamentals
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Feigenbaum’s quality philosophy emphasizes the need for everyone in the
organization to focus obsessively on serving the external and internal customers. To this end, Total Quality Control provides Four management fundamentals of total quality:
1. Make quality a full and equal partner, with innovation starting from the inception of product development.
2. Emphasize getting high-quality product design and process matches upstream, before manufacturing planning has frozen the alternatives.
3. Make full-service suppliers a quality partner at the beginning of design rather than implementing a quality surveillance program later.
4. Make the acceleration of new product introduction a primary measure of the effectiveness of a company’s quality program.
Feigenbaum Ten Benchmarks
Six Sigma Black Belt | Enterprise-Wide Deployment | Org. Improvement and Six Sigma Foundations History Task: Feigenbaum Ten Benchmarks
In addition to the "Four Fundamentals," Feigenbaum offers Ten benchmarks that are key to implementing total quality control with success.
Benchmarks 1 through 5:
1. Quality is an organization-wide process
Quality is neither a specialist function, nor a department, nor an awareness or testing program alone. It is a disciplined system of customer-connected work processes implemented throughout the organization and integrated with suppliers. High quality products are the result of high quality work processes. If you do not improve the process, you cannot expect substantial improvement in results.
2. Quality is what the customer says it is.
Quality is not what a developer, manager or marketer says it is. If you want to find out about your quality, ask your customer. No one can compress in a market research statistic or defect rate the extent of buyer frustration or delight.
3. Quality and cost are a sum, not a difference.
Quality and cost are not adversaries. The quality costs of fixing failures are high compared to quality costs required to properly prevent such defects. True quality leaders are cost leaders, and commonly enjoy advantages of 10-20% for competitive cost.
4. Quality requires both individual and teamwork zealotry.
Quality is everyone's job. Without a clear infrastructure that supports both the quality work of individuals and the teamwork among individuals and departments, however, quality is an orphaned responsibility. Too often quality improvement activities become islands without bridges. All the left hands must work effectively with all the right hands.
5. Quality is a way of managing.
Good management today means empowering the quality knowledge, skills and attitudes of everyone in the organization to recognize that making quality right makes everything else in the organization right. The belief that quality travels under some exclusive national passport, or has some unique geographical or cultural identity, is a