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Six Sigma business management

  Six Sigma is a business management strategy originally developed by Motorola, USA in 1981.As of 2010, it enjoys widespread application in many sectors of industry, although its application is not without controversy.

  Six Sigma seeks to improve the quality of process outputs by identifying and removing the causes of defects (errors) and minimizing variability in manufacturing and business processes.It uses a set of quality management methods, including statistical methods, and creates a special infrastructure of people within the organization ("Black Belts", "Green Belts", etc.) who are experts in these methods. Each Six Sigma project carried out within an organization follows a defined sequence of steps and has quantified targets. These targets can be financial (cost reduction or profit increase) or whatever is critical to the customer of that process (cycle time, safety, delivery, etc.).

The term six sigma originated from terminology associated with manufacturing, specifically terms associated with statistical modelling of manufacturing processes. The maturity of a manufacturing process can be described by a sigma rating indicating its yield, or the percentage of defect-free products it creates. A six-sigma process is one in which 99.99966% of the products manufactured are free of defects, compared to a one-sigma process in which only 31% are free of defects. Motorola set a goal of "six sigmas" for all of its manufacturing operations and this goal became a byword for the management and engineering practices used to achieve it.

  Historical overview

Six Sigma originated as a set of practices designed to improve manufacturing processes and eliminate defects, but its application was subsequently extended to other types of business processes as well.In Six Sigma, a defect is defined as any process output that does not meet customer specifications, or that could lead to creating an output that does not meet customer specifications.

Bill Smith first formulated the particulars of the methodology at Motorola in 1986. Six Sigma was heavily inspired by six preceding decades of quality improvement methodologies such as quality control, TQM, and Zero Defects,[5][6] based on the work of pioneers such as Shewhart,Deming, Juran, Ishikawa, Taguchi and others.

  Like its predecessors, Six Sigma doctrine asserts that:

  • Continuous efforts to achieve stable and predictable process results (i.e., reduce process variation) are of vital importance to business success.
  • Manufacturing and business processes have characteristics that can be measured, analyzed, improved and controlled.
  • Achieving sustained quality improvement requires commitment from the entire organization, particularly from top-level management.

 

  Features that set Six Sigma apart from previous quality improvement initiatives include:

  • A clear focus on achieving measurable and quantifiable financial returns from any Six Sigma project.
  • An increased emphasis on strong and passionate management leadership and support.
  • A special infrastructure of "Champions," "Master Black Belts," "Black Belts," "Yellow Belts", etc. to lead and implement the Six Sigma approach.
  • A clear commitment to making decisions on the basis of verifiable data, rather than assumptions and guesswork.

The term "Six Sigma" comes from a field of statistics known as process capability studies. Originally, it referred to the ability of manufacturing processes to produce a very high proportion of output within specification. Processes that operate with "six sigma quality" over the short term are assumed to produce long-term defect levels below 3.4 defects per million opportunities (DPMO).Six Sigma's implicit goal is to improve all processes to that level of quality or better.

Six Sigma is a registered service mark and trademark of Motorola Inc.[9] As of 2006 Motorola reported over US$17 billion in savings from Six Sigma.

Other early adopters of Six Sigma who achieved well-publicized success include Honeywell (previously known as AlliedSignal) and General Electric, where Jack Welch introduced the method.By the late 1990s, about two-thirds of the Fortune 500 organizations had begun Six Sigma initiatives with the aim of reducing costs and improving quality.

In recent years, some practitioners have combined Six Sigma ideas with lean manufacturing to yield a methodology named Lean Six Sigma.

  Methods

  Six Sigma projects follow two project methodologies inspired by Deming's Plan-Do-Check-Act Cycle. These methodologies, composed of five phases each, bear the acronyms DMAIC and DMADV.

  • DMAIC is used for projects aimed at improving an existing business process. DMAIC is pronounced as "duh-may-ick".
  • DMADV is used for projects aimed at creating new product or process designs. DMADV is pronounced as "duh-mad-vee".

  DMAIC

  The DMAIC project methodology has five phases:

  • Define the problem, the voice of the customer, and the project goals, specifically.
  • Measure key aspects of the current process and collect relevant data.
  • Analyze the data to investigate and verify cause-and-effect relationships. Determine what the relationships are, and attempt to ensure that all factors have been considered. Seek out root cause of the defect under investigation.
  • Improve or optimize the current process based upon data analysis using techniques such as design of experiments, poka yoke or mistake proofing, and standard work to create a new, future state process. Set up pilot runs to establish process capability.
  • Control the future state process to ensure that any deviations from target are corrected before they result in defects. Control systems are implemented such as statistical process control, production boards, and visual workplaces and the process is continuously monitored.

  DMADV

  • The DMADV project methodology, also known as DFSS ("Design For Six Sigma"), features five phases:
  • Define design goals that are consistent with customer demands and the enterprise strategy.
  • Measure and identify CTQs (characteristics that are Critical To Quality), product capabilities, production process capability, and risks.
  • Analyze to develop and design alternatives, create a high-level design and evaluate design capability to select the best design.
  • Design details, optimize the design, and plan for design verification. This phase may require simulations.

Verify the design, set up pilot runs, implement the production process and hand it over to the process owner(s).

 Quality management tools and methods used in Six Sigma

  • Within the individual phases of a DMAIC or DMADV project, Six Sigma utilizes many established quality-management tools that are also used outside of Six Sigma. The following table shows an overview of the main methods used.

 




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