Chapter 1

Introduction to Essentials of
Lean Six Sigma (6s) Strategies
Lean Six Sigma: Six Sigma Quality with
Lean Speed

1.1 LEAN SIX SIGMA (6s ) CONCEPT REVIEW

1.1.1 THE PHILOSOPHY

In any organization customer satisfaction is the number one priority. Customer

satisfaction also means profitability. The success of any company depends on the
ability to ensure the highest quality at the lowest cost. In the 1980s when most
companies believed that producing quality products was too costly, Motorola
believed the opposite: the better, the cheaper. It realized that by producing a
higher-quality product, the cost of producing goes down. Motorola knew that
greater customer satisfaction generates higher profitability.
Today the competitive market leaves no space for error. It is now necessary
to implement the concepts of Lean Six Sigma. Lean Six Sigma is a business
strategy in which the focus is to improve the bottom line and increase customer
satisfaction.
Six Sigma philosophies are related to statistical process control, stochastic
control (relating to probability), and engineering process control. In addition, it
requires process and data analysis, optimization methods, lean manufacturing,
design of experiment, analysis of variance, statistical methods, mistake-proofing,
on-time and or on-schedule shipping, waste reduction, and consistency as-
surance. It is a process capability that continuously improves the quality of the
product and maximizes productivity. In simpler terms, Lean Six Sigma is the
following:
Essentials of Lean Six Sigma
Copyright 2006 by Academic Press, Inc. All rights of reproduction in any form reserved. 1

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 2 Introduction to Essentials of Lean Six Sigma (6s) Strategies

1. It is a data-driven approach and methodology to analyze the root causes

of manufacturing and business problems/processes by eliminating
defects (driving toward six standard deviations between the mean and
the nearest specification limit), and dramatically improving the product.
2. It improves the employees knowledge of business management to distinguish
the business from the bottom line, customer satisfaction, and on-time delivery.
Thus, Six Sigma is not just process-improvement techniques but a
management strategy to manage the projects to financial goals.
3. It combines robust design engineering philosophy and techniques with
low risks (Lean Six Sigma tools: measure, analyze, develop, and verify).
It would be very difficult to achieve this goal without teamwork and proper
training of the entire organization to a higher level of competency. During the
1980s Six Sigma grew into a distinct manufacturing discipline. It now encompasses
a wide range of disciplines, including transportation, administration, manufactur-
ing, medical, and a variety of other operating organizations and processes (by defi-
nition a process is any operation that has an input and produces an output).

1.1.2 LEAN /KAIZEN SIX SIGMA ENGINEERING

Lean speed is a technique as well as a continuous effort that is used to acceler-

ate and minimize the cost of any process by eliminating the waste in either
manufacturing or service. Basically, Lean philosophy identifies and removes
inefficiencies like the nonvalue-added (waste) cost or unneeded wait time within
the process caused by defects, excess production, and other processes to expand
any organization. For example, in most cases 95% of the lead time (from the
beginning to the end of a process) is the wait time. Further, 80% of process delays
are caused by a 20% time trap (activities in the workstation). By improving 20%
time trap, it can eliminate 80% of process delays. Hence, Lean is associated with
speed, efficiency, and acceleration of the process. Therefore, by integrating ele-
ments of Lean enterprise methodology with Six Sigma, which lacks tools that
control and reduce lead time, the feedback will be faster than planned.
The combination of these two powerful tools, Lean manufacturing and Six
Sigma strategy, will result in process variation reduction and dramatic bottom-
line (language of CEO) improvement. Since all companies are in the business of
achieving faster return on investments, particularly for their shareholders, using
Lean principles in Six Sigma is extremely important. For the company architect-
ing Six Sigma philosophy in its infrastructure, Lean manufacturing speed can
accelerate the implementation and benefits of the manufacturing process.
Here are some of the basic Lean manufacturing techniques and principles that
are used in Lean Six Sigma:

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 Introduction to Essentials of Lean Six Sigma (6s) Strategies 3

1. 5S
Sort (keep things that are essential), Shine (keep everything clean),
Straighten (make everything visible and accessible), Standardize
(implement the first 3S and maintain them), and Sustain.
The first 3S are actions, and the last two are sustaining and
progressive.
2. Value-stream mapping
A method of mapping a products production path from manufacturing
facility to customers door.
A visual tool for identifying all steps of operations in the
manufacturing process with cost-effective results.
3. Kaizen event
Continuous improvement.
4. Mistake-proofing
Process analysis and implementation of robust engineering to build
quality into an assembly or manufacturing process with cost-effective
results.
5. Cycle time reduction
6. Inventory reduction
7. Setup time reduction
8. Waste identification and elimination
In other words, the Lean speed is merged with or is embedded within the Six
Sigma principles. The integration of these two concepts will both deliver faster
results and achieve the best competitive position by concentrating on the use of tools
that have the highest impact on the already established performance levels. Another
example is the design of experiment that may require about 16 runs to determine
optimum factors and reduce variation. Minimizing the lead time by 80% will allow
the experiment to be completed five times faster using fractional factorial design.
Basically Lean contributes to Six Sigma in the following manner:
1. Eliminates all the waste time that slows the project.
2. Maintains customer satisfaction with speed in delivery.
3. Gets the project done under the deadline and possibly under budget.
4. Continuously improves the profitability (e.g., in a shorter period of time
than planned).

1.2 SIX SIGMA BACKGROUND

Motorola engineering scientist William Smith, known as the father of Six Sigma,
developed the concept in the 1980s. For many years, he and other pioneering engineers
and scientists worked on this or similar concepts to reduce variation, improve quality,

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 4 Introduction to Essentials of Lean Six Sigma (6s) Strategies

and maximize productivity, including Walter A. Shewhart, W. Edwards Deming (see

Appendix for Demingrs 14 points for management), Philip R. Crosby, Shiego Shingo,
Taiichi Ohno, and Joseph Juran. Each one studied quality from a different angle.
The methodology of Six Sigma uses the statistical theory and thus assumes
that every process factor can be characterized by a statistical distribution curve.
The objective is to free all the defects from every process, product, and transac-
tion. It is a process that provides tools to achieve nearly error-free products and
services with maximum profitability. In the 1960s and 1970s, statistical process
control limits were based on plus or minus three sigma (3 standard deviation)
from the mean. However, in this concept the process limits are plus or minus Six
Sigma from the mean.
Just like three sigma, Six Sigma is applicable to batch-to-batch process, dis-
crete, and continuous applications. The goal is to produce less than four defects
per one million operations. Six Sigma will enable a company to capture substan-
tial market share in the competitive global markets. Global competitiveness
almost becomes impossible without Six Sigma. Every company would benefit by
adopting Six Sigma concepts and philosophy. Profitability improves tremen-
dously if it is applied to all workforces in every department of the corporation.

1.3 SIX SIGMA SUCCESSES

An example of a Six Sigma successe is Motorola Corporation, which increased

net income from $2.3 billion in 1978 to $8.3 billion in 1988, using the Six Sigma
program. As a result, Motorola received the Malcolm Baldrige National Quality
Award by President Reagan in 1988. The award is presented to the industries that
become quality role models for others. GE also implemented Six Sigma in the
mid-1990s in a five-year program and boosted its profits by a substantial amount.
By the year 2002 GE had achieved $4 billion in savings per year. Other compa-
nies that benefit from Six Sigma are Allied Signal, Inc.; Polaroid Corporation;
Asea Brown Boveri Power Transformer Company; and DuPont.
At three sigma the cost of quality is 25 to 40% of sales revenue. At Six Sigma
it reduces cost of quality to less than 1% of sales revenue. In fact, Lean Six Sigma
is the epitome of quality and should be adopted by all manufacturing companies
to remain in business. Therefore, one must change measurement of quality in
parts per hundred (percentages) to parts per million. This has changed the
makeup and culture of industries that adopted Lean Six Sigma.

Sigma Variation
Mathematically variation and reproducibility are inversely related to each
otherfor example, as variation increases, producibility decreases due to increase

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 Introduction to Essentials of Lean Six Sigma (6s) Strategies 5

Table 1.1
Comparisons of 3.8 Sigma and Six Sigma Defect Examples
3.8 Sigma (99% Good) Six Sigma (99.99966% 6s)

200,000 wrong drug prescriptions per year 680 wrong prescriptions per year
5,000 incorrect surgical operations per week 88 incorrect operations per week
More than 15,000 newborn babies accidentally 5 newborn babies dropped per year
dropped per year
2 short or long landings at major airports per day Less than 1 short or long landing
every 8 years
20,000 articles of mail lost per hour 7 articles lost per hour

Table 1.2
Comparisons of Old (Traditional) and New (Lean Six Sigma) Methods
Problem Old methods New methods

Design Product performance Product producibility

Analysis Experience based Data based
Issue Fixing problems Preventing problems
Manufacturing/ Trial & error process Robust design process
Molding
Inventory level High production quantity Low production quantity as needed
People Cost to company Asset to company
Management Cost & time Quality & time
Employee goal Company Customer
Product engineering Little input from customer High input from customer
Quality focus Product Process
Dominant process Apply one factor at a time Apply design of experiment
factorsselection
Process improvement Robotic technique Optimization technique
Proving Experience based Statistically based
Company outlook Short-term plan Long-term plan
Customer satisfaction Production at statistical Fewer defects, when and what
acceptance quality level quantity customer wants
External relationship Price relationship Long-term relationship
Layout Functional Cell type
Production schedules Forecast Customer order
Manufacturing cost Continuously rising Stable and decreasing

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 6 Introduction to Essentials of Lean Six Sigma (6s) Strategies

of nonconformance (in the technical sense called a rejection or defect) probabil-

ity. Additional workforce, cost, scrap, and cycle time reduce the sigma level
where such variation comes from design, process, and material of the finished
products. Consequently, sigma variation reduces customer satisfaction and has
negative impact in the profitability, which is one of the main focus areas of Six
Sigma.
It is too difficult to convert any operation from three sigma (3.0s) to Six Sigma
(6.0s) in one step. It will require several steps of improvements from 3.0s to
4.0s, 4.5s, 5.0s, 5.5s, and finally 6s (Tables 2.2 through 2.4 illustrate how as
sigma increases, product quality and profitability also increase). This also means
that cycle time is reduced, quality checks are minimized, operating cost goes
down, variable costs shrink, and customer satisfaction goes up. At Six Sigma, all
products conform to a worldwide standard and are nearly defect free. In other
words, Six Sigma determines the capability of the process to accomplish a defect-
free work environment. So sigma range dictates how often defects are likely to
happen in the system. Six Sigma is not twice as good as three sigma but almost
20,000 times better.
Some examples of Six Sigma quality for long-term processes are shown in
Table 1.1.
Highlights of some of the Six Sigma cultural changes are listed in Table 1.2.

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