Six Sigma
FOR
DUMmIES‰
2ND EDITION
Six Sigma
FOR
DUMmIES‰
2ND EDITION
by Craig Gygi and Bruce Williams
with Neil DeCarlo
Foreword by Stephen R. Covey
Author, The 7 Habits of Highly Effective People and
The Leader in Me: How Schools and Parents Around the
World Are Inspiring Greatness, One Child at a Time
Six Sigma For Dummies®, 2nd Edition
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About the Authors of the Revised Edition
Craig Gygi began studying and applying the elements of Six Sigma and
Lean before they were formalized into today’s renowned improvement
methodologies. As a graduate student in Mechanical Engineering at Brigham
Young University, he integrated these cutting-edge improvement techniques
into his coaching of student product development teams. Upon beginning
his career at Motorola, he was formally introduced to the emerging Six Sigma
method. It resonated deeply with his previous findings. From that time,
Craig has applied, taught, and led Six Sigma in all his endeavors, including
technical, management, and executive capacities at Iomega, General Atomics,
ES3, and Fiji Water.
Craig now serves as Executive VP of Global Operations for MasterControl.
MasterControl produces software solutions that enable regulated companies
to manage their critical quality procedures and get their products to market
faster, while reducing overall costs and increasing internal efficiency.
A Master Black Belt, Craig has wielded Six Sigma and Lean techniques now
for over 18 years, spanning projects from design to manufacturing to busi-
ness process management, and at companies as varied as Abbott Labs,
American Express, and the US Air Force. He is also an expert teacher, having
instructed and mentored at all levels.
Craig lives in Utah with his wife and children, where they enjoy its varied
landscape and outdoor activities.
Bruce David Williams has been fascinated with complex systems since
the launch of Sputnik on his birthday. With degrees from the University
of Colorado in physics and astrophysics, he embarked on a career in
aerospace systems, where he first encountered Six Sigma after Motorola won
the inaugural Baldridge Award in 1988. Later, with graduate degrees from
Johns Hopkins and Colorado in computer science and technical management,
and as a member of the Hubble Telescope development team, he became
intrigued with how large system failures could result from the breakdown of
small components. He entered the Six Sigma industry in the late-1990s
when he co-founded a software company to develop products for life-cycle
traceability.
Bruce has since been the co-founder of two Six Sigma research and technology
firms, including the Six Sigma Management Institute. He was co-founder and
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CEO of Savvi International, a provider of solutions for business performance
improvement. He joined webMethods in 2006 to integrate enterprise-class
information technologies with business process management and now is the
Senior Vice President for Software AG, a leading global provider of technologies
and solutions for Business Process Excellence.
Bruce resides in the desert foothills of north Scottsdale, Arizona, with his
wife and assortment of dogs, cats, birds, horses, and varied native wildlife.
Dedication
Craig Gygi: To Esti, my unexpected joy.
Bruce Williams: To Hannah and Evan, my remarkable children, as they tran-
sition into independent adulthood and put the concept of variance reduction
to practical use.
About the Co-Author of the First Edition
Neil John DeCarlo was a professional communicator in the continuous
improvement, Lean, Six Sigma, sales and marketing, innovation, and corporate
finance fields for nearly 25 years, beginning with his work at Florida Power &
Light Company when it won the coveted Deming Prize for quality. Following
that time, he authored, ghostwrote, or edited more than 150 articles and eight
books in association with such companies as General Electric, DuPont, Bose
Corporation, BMGI, McKinsey & Company, UPS, AT&T, the Six Sigma Academy,
and many others. Neil also worked with several CEOs and consultants, includ-
ing Japanese quality expert Dr. Noriaki Kano and the original co-architect of Six
Sigma, Dr. Mikel Harry.
In addition to his writing accomplishments, Neil managed communication
and publishing campaigns for a variety of companies, most notably BMGI,
an international consulting firm that teaches and deploys Lean Six Sigma,
innovation, and such other methods as Hoshin strategic planning. While not
working, Neil enjoyed most all outdoor sports, reading, questioning everything,
and practicing yoga. He lived in a small town called Fountain Hills, just outside
Scottsdale, Arizona, with Jeannie — his lovely wife and best friend.
Dedication
To Wanda Texon, who helped me believe in myself a long time ago, and who
has been a constant source of support and intellectual stimulation for many
years.
Authors’ Acknowledgments
to the 2nd Edition
We’re grateful for those who contributed their efforts and support to this 2nd
edition of Six Sigma For Dummies.
Our deepest gratitude and thanks to Dr. Stephen R. Covey for his foreword —
but much more so for his profound life-long insights and contributions to the
betterment of individual leadership. Only a few weeks before the printing of
this 2nd edition, Dr. Covey passed away. His passing poignantly reminded us
of the transcendent power of the individual — both in the example of his own
life and his remarkable influence on the world — and in the similar potential
he taught resides within each of us.
Thank you also to Natalie Sayer, co-author of both the 1st and 2nd editions of
Lean For Dummies (Wiley), for her expert collaboration and assistance.
Publisher’s Acknowledgments
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Contents at a Glance
Introduction ................................................................ 1
Part I: Getting Acquainted with Six Sigma Basics .......... 7
Chapter 1: Better Business and Better Performance: Defining Six Sigma .................. 9
Chapter 2: Linking Quality and Business ...................................................................... 17
Chapter 3: Examining the Principles and Language of Six Sigma .............................. 31
Chapter 4: Organizing for Improvement ....................................................................... 43
Part II: DMAIC: Defining and Measuring ..................... 61
Chapter 5: Identifying and Right-Sizing Projects ......................................................... 63
Chapter 6: Launching a Project ...................................................................................... 77
Chapter 7: Mapping to Identify Possible Factors ........................................................ 87
Chapter 8: Diagramming to Identify Possible Factors .............................................. 101
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Chapter 9: Describing Performance with Numbers .................................................. 113
Part III: DMAIC: Analyzing ...................................... 133
Chapter 10: Depicting and Analyzing Data through Charts and Graphs ................ 135
Chapter 11: Analyzing for Value ................................................................................... 155
Chapter 12: What’s Normal? Recognizing Normally-Shaped Variation................... 165
Chapter 13: Assessing Capability: Comparing the Voices of the Customer
and the Process ........................................................................................................... 179
Chapter 14: Gauging Gauges: Measurement System Analysis (MSA)...................... 199
Chapter 15: Mining Data and Processes for Insight .................................................. 209
Chapter 16: Making Confident Decisions .................................................................... 227
Part IV: DMAIC: Improving and Controlling ............... 241
Chapter 17: Forecasting Future Performance ............................................................ 243
Chapter 18: Designing, Conducting, and Analyzing Experiments (DOE) ................ 259
Chapter 19: Standardizing on Improvement .............................................................. 281
Chapter 20: Maintaining Gains through Statistical Process Control ....................... 291
Part V: Looking at the Six Sigma Technology
Tool Landscape ........................................................ 309
Chapter 21: Eyeing Process Characterization and Optimization Technologies .... 311
Chapter 22: Tools for Performing Six Sigma Analysis ............................................... 323
Chapter 23: Managing Six Sigma .................................................................................. 331
Part VI: The Part of Tens .......................................... 343
Chapter 24: Ten Top Do’s and Don’ts of Six Sigma ................................................... 345
Chapter 25: Ten Ways to Gain Synergies with Lean and Six Sigma ......................... 349
Chapter 26: Ten Places to Go for Help ........................................................................ 353
Index ...................................................................... 357
Table of Contents
Introduction ................................................................. 1
About This Book .............................................................................................. 1
Conventions Used in This Book ..................................................................... 2
What You’re Not to Read ................................................................................ 3
Foolish Assumptions ....................................................................................... 3
How This Book Is Organized .......................................................................... 3
Part I: Getting Acquainted with Six Sigma Basics .............................. 4
Part II: DMAIC: Defining and Measuring .............................................. 4
Part III: DMAIC: Analyzing ..................................................................... 4
Part IV: DMAIC: Improving and Controlling ........................................ 4
Part V: Looking at the Six Sigma Technology Tool Landscape ........ 5
Part VI: The Part of Tens ....................................................................... 5
Icons Used in This Book ................................................................................. 5
Where to Go from Here ................................................................................... 6
Part I: Getting Acquainted with Six Sigma Basics ........... 7
Chapter 1: Better Business and Better Performance:
Defining Six Sigma . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Discovering What’s Behind the Name .......................................................... 9
Tackling Six Sigma from the Managerial Perspective ............................... 11
Bridging science and leadership ........................................................ 11
Management system orientation ....................................................... 13
Chapter 2: Linking Quality and Business . . . . . . . . . . . . . . . . . . . . . . . . . 17
Specifications: Listening to the Voice of the Customer ............................ 17
How close is close enough? Understanding the need for
specifications .................................................................................... 18
Defining specifications ........................................................................ 18
Do you do the RUMBA? Creating realistic specifications ............... 19
Examining What Quality Truly Is ................................................................. 20
Discovering the cost of poor quality curve:
Football and Taguchi’s loss function ............................................. 23
Avoiding the hidden factory ............................................................... 25
Looking at How Quality Beliefs Determine Behavior ................................ 26
Comparing belief systems side by side ............................................. 26
Journeying from one to many ............................................................ 27
Connecting quality and variation ...................................................... 27
Calculating Six Sigma quality.............................................................. 28
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Six Sigma For Dummies, 2nd Edition
Chapter 3: Examining the Principles and Language of Six Sigma . . . 31
Starting Out with One Simple Equation: Y = f(X) + ε................................... 31
Principle 1: Recognizing Determinism ........................................................ 33
Seeking cause and effect ..................................................................... 33
Correlation doesn’t imply causation: Resisting superstitious
delusions ........................................................................................... 34
Principle 2: Reducing Variation ................................................................... 35
Understanding variation ..................................................................... 35
Categorizing common cause versus special cause variation ......... 36
Coping with variation .......................................................................... 37
We’re adrift: Peeking at short-term and long-term variation ......... 37
Principle 3: Measuring for Success ............................................................. 38
Minding your Ys and Xs ...................................................................... 38
Summing it up with data ..................................................................... 39
Principle 4: Applying Leverage .................................................................... 39
Appreciating the difference between the critical few and
the trivial many ................................................................................ 40
Separating and utilizing the critical few............................................ 41
Principle 5: Managing Risk ........................................................................... 42
Chapter 4: Organizing for Improvement . . . . . . . . . . . . . . . . . . . . . . . . . . 43
DMAIC: Introducing Your Project Strategy ................................................ 43
Venturing to the Domains of Activity ......................................................... 45
Thinking for breakthrough ................................................................. 45
Processing for breakthrough.............................................................. 46
Designing for breakthrough ................................................................ 46
Managing for breakthrough ................................................................ 47
Filling the Roles: Who You Need to Know .................................................. 48
Starting at the top ................................................................................ 48
Assembling the core team .................................................................. 49
Focusing on functional representatives ............................................ 50
Spotting the deployment leader ........................................................ 51
Meeting the Six Sigma Champion ....................................................... 53
Number-crunching karate: Black Belts and their brethren ............ 54
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Following the Five Stages of a Six Sigma Initiative .................................... 56
Initializing: Ready, aim . . . .................................................................. 57
Deploying: Setting the infrastructure in motion .............................. 58
Implementing: Forging first successes .............................................. 58
Expanding: Taking it everywhere ...................................................... 59
Sustaining: The self-healing culture................................................... 60
Part II: DMAIC: Defining and Measuring ...................... 61
Chapter 5: Identifying and Right-Sizing Projects . . . . . . . . . . . . . . . . . . 63
Launching a Six Sigma Project ..................................................................... 64
Scoping the perfect project ................................................................ 64
Transforming the problem ................................................................. 65
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Knowing your goals and needs .......................................................... 65
Determining project responsibilities................................................. 67
Writing the Business Case ............................................................................ 68
Starting with candidate business-case statements ......................... 68
Selecting the business case ................................................................ 69
When You’re Ready: Defining a Six Sigma Project .................................... 70
Following the steps of the project definition process..................... 71
Identifying the significant Y ................................................................ 73
Understanding how bad it actually is................................................ 74
Deciding whether a project is worthwhile ....................................... 75
Chapter 6: Launching a Project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Describing the Problem with a Problem Statement .................................. 77
Deciding How Much Improvement Is Enough ............................................ 80
Asking “How much am I entitled to?” ............................................... 80
Acknowledging that other hidden opportunities exist .................. 81
Going for breakthrough improvement .............................................. 82
Setting an Improvement Target with Your Objective Statement ............ 83
Getting a Project Approved and Assigned ................................................. 85
Chapter 7: Mapping to Identify Possible Factors . . . . . . . . . . . . . . . . . . 87
Breaking Down Process Flow ....................................................................... 88
Drawing a process map ....................................................................... 89
Defining and visualizing the process points ..................................... 90
Acknowledging the as-is state ............................................................ 92
Developing a SIPOC ....................................................................................... 93
VSM: Charting the Value Stream .................................................................. 94
Introducing a stream of resources, information, and value ........... 95
Creating a VSM for your process ....................................................... 96
Chapter 8: Diagramming to Identify Possible Factors . . . . . . . . . . . . . 101
Breaking Down Brainstorming Tools ........................................................ 102
Affinity diagrams ................................................................................ 102
Fishbone (Ishikawa) diagrams ......................................................... 102
Focusing on Failure Mode Effects Analysis (FMEA) ................................ 103
Listing process steps ......................................................................... 104
Identifying requirements and recording potential
failure modes .................................................................................. 106
Spelling out effects of failures .......................................................... 106
Scoring the severity of the effects ................................................... 107
Listing causes of failure modes ........................................................ 108
Scoring the occurrence of the cause ............................................... 108
Identifying current controls ............................................................. 109
Scoring the detection of the controls.............................................. 109
Calculating and reviewing RPN scores ............................................ 111
Devising and assigning improvement actions ................................ 111
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Six Sigma For Dummies, 2nd Edition
Chapter 9: Describing Performance with Numbers . . . . . . . . . . . . . . . 113
Recognizing Different Types of Data ......................................................... 113
Identifying attribute (category) data ............................................... 114
Classifying continuous (variable) data ........................................... 115
Using Statistics to Make Sense of Data ..................................................... 116
Beginning with measurement 101: Distribution ............................. 117
Measuring distribution location ...................................................... 118
Calculating the width of variation ................................................... 121
The Long and Short of Variation ............................................................... 125
Sizing up short-term variation.......................................................... 125
Shift happens: Looking at long-term variation ............................... 128
Being all you can be: Entitlement .................................................... 130
Part III: DMAIC: Analyzing ....................................... 133
Chapter 10: Depicting and Analyzing Data
through Charts and Graphs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135
Checking Out Dot Plots and Histograms .................................................. 136
Creating your own dot plots and histograms ................................ 136
Interpreting dot plots and histograms ............................................ 137
Comparing Distributions in Box and Whisker Plots ............................... 141
Making your own box and whisker plot .......................................... 141
Making sense of box and whisker plots .......................................... 143
Making Connections with Scatter Plots .................................................... 144
Developing a scatter plot .................................................................. 144
Drawing correlations from a scatter plot ....................................... 146
Hindsight Is 20/20: Observing Process Behavior Charts ........................ 150
Creating a characteristic or process behavior chart .................... 150
Interpreting characteristic or process behavior charts ............... 151
Chapter 11: Analyzing for Value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155
Understanding and Achieving Value: It’s Customer-Driven ................... 155
Ascertaining value ............................................................................. 156
Waste not: Defining the seven forms of waste ............................... 157
Kano’s framework: Hearing the voice of the customer ................. 158
Analyzing Process Flow for Value: Introducing Take One, Make One ..... 160
Considering Cause-and-Effect (C&E) Analysis ......................................... 161
Laying out the matrix ........................................................................ 161
Adding some weight .......................................................................... 162
Figuring the final score ...................................................................... 162
Go team! Appreciating group input when using C&E .................... 164
Leveraging Your Old Friend FMEA for Value ........................................... 164
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Chapter 12: What’s Normal? Recognizing Normally-Shaped
Variation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165
Defining Normal: Bell-Shaped Variation and Probability ....................... 165
Meeting the model: The standard normal distribution ................ 167
Working with nonstandard normal data: The Z transformation .... 171
Using Excel to calculate normal probabilities ............................... 172
Checking How Well Data Follow a Normal Curve:
Normal Probability Plots......................................................................... 174
Constructing a normal probability plot .......................................... 174
Interpreting your normal probability plot ...................................... 177
Chapter 13: Assessing Capability: Comparing the Voices
of the Customer and the Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 179
Working with Yield and Defect Rates ........................................................ 179
Measuring yield .................................................................................. 179
Measuring defect rate........................................................................ 184
Brought to you by the number e: Linking yield and defect rate .... 189
What’s Your Sigma, Baby? Deciphering Sigma (Z) Score ....................... 189
Breaking down how many standard deviations can fit ................. 190
Comparing short-term versus long-term sigma score
calculations ..................................................................................... 191
Linking short-term capability to long-term performance
with the 1.5-sigma shift .................................................................. 192
Considering Capability Indices .................................................................. 195
Short-term capability index (CP) ...................................................... 195
Adjusted short-term capability index (CPK) .................................... 196
Long-term capability indices (PP and PPK) ...................................... 198
Prescribing a capability improvement plan ................................... 198
Chapter 14: Gauging Gauges: Measurement System
Analysis (MSA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 199
Avoiding Illusion: Measurement System Capability Analysis ................ 199
Looking at variation in a measurement system ............................. 200
Sources of measurement system variation .................................... 200
Measuring Measurements: Measurement System Analysis (MSA) ....... 203
Audit measurement system studies ................................................ 203
Attribute measurement system studies .......................................... 204
Gauge or continuous variable measurement system studies ...... 207
Chapter 15: Mining Data and Processes for Insight . . . . . . . . . . . . . . 209
Filling the Funnel ......................................................................................... 209
Let the data do the talking ................................................................ 210
Cast a big net ...................................................................................... 210
Mining Data for Insight ................................................................................ 211
Go with what you have: Observational studies ............................. 211
Digging in: Identifying potential sources of variation
through graphical analysis ........................................................... 213
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Six Sigma For Dummies, 2nd Edition
Nearly Magical Multi-Vari Charts: Expertly Screening Factors .............. 216
Categorizing the variations............................................................... 216
Putting it all together: Creating a multi-vari sampling plan ......... 217
Constructing a multi-vari chart ........................................................ 218
Interpreting a multi-vari chart .......................................................... 220
Checking out a Multi-Vari Example ........................................................... 223
Chapter 16: Making Confident Decisions . . . . . . . . . . . . . . . . . . . . . . . . 227
Introducing Populations and Samples ...................................................... 227
Parameter Distributions from Multiple Samples: Using the Central
Limit Theorem .......................................................................................... 228
Calculating Decision Risk: Confidence Intervals ..................................... 230
Confidence intervals for means ....................................................... 230
Confidence intervals for standard deviations ................................ 234
Four out of five recommend: Confidence intervals
for proportions ............................................................................... 237
Part IV: DMAIC: Improving and Controlling ................ 241
Chapter 17: Forecasting Future Performance . . . . . . . . . . . . . . . . . . . .243
Seeing the Correlation ................................................................................ 243
Getting a Handle on Curve Fitting ............................................................. 246
Finding the line: Simple linear regression ...................................... 247
Discovering residuals and the fitted model.................................... 249
Practicing tools for fitting lines ........................................................ 254
Moving on to multiple linear regression ......................................... 255
Chapter 18: Designing, Conducting, and Analyzing
Experiments (DOE) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 259
Seeing the Improvement Power of Six Sigma Experiments .................... 259
Achieving better understanding through experiments ................ 260
Getting schooled on the terms ......................................................... 261
The end game of Six Sigma experiments ........................................ 261
Looking Before You Leap: Experimental Considerations ....................... 262
The trial-and-error approach ........................................................... 262
The one-factor-at-a-time approach .................................................. 263
The boil-the-ocean approach ........................................................... 263
The Six Sigma approach: Multitasking and progressing ............... 264
Setting up 2k Factorial Experiments .......................................................... 266
Planning your experiment ................................................................ 266
Conducting your experiment ........................................................... 269
Analyzing your experiment............................................................... 270
You’ve Only Just Begun: Looking at More Topics in Experimentation ......278
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xix
Chapter 19: Standardizing on Improvement . . . . . . . . . . . . . . . . . . . . . . 281
Satisfying the Need for Control Planning ................................................. 281
The process management summary ............................................... 282
The process control plan .................................................................. 283
5S: Housekeeping for Sustained Impro...