... 6 SIGMA In 2001, Caterpillar launched its 6 Sigma program to drive change to achieve the company’s long-term strategic goals (Caterpillar uses 6 Sigma to identify its Six Sigma initiatives). This 6 Sigma process was, and continues to be, extremely successful. Some of the results include first-year benefits that exceeded implementation cost and achievement of the revenue goal two years earlier than planned. We’ll briefly discuss Six Sigma in general, describe Caterpillar, and show the entrenchment of 6 Sigma within the company’s strategic planning process. April 2010 I S T R AT E G I C F I N A N C E 25 C OVE R S TO R Y What Is Six Sigma? Six Sigma is a total quality management (TQM) technique pioneered by and applied to Motorola processes in the 1980s by Bill Smith, a Motorola engineer who became known as “the father of Six Sigma.” Since then, other companies, such as Bank of America, Honeywell International, Raytheon, and General Electric, have taken these learned processes and expanded them. Even though many people have reservations about the potential savings from Six Sigma, a story by Charles Waxer (“Six Sigma Costs and Savings: The financial benefits of implementing Six Sigma at your company can be Significant,” www.isixsigma.com/index.php?option=com_k2&view= item&id=1228<emid=187) reports that GE saved more than $12 billion over five years, Honeywell saved $800 million, and Motorola saved $15 billion over 11 years. Each company takes the Six Sigma process...
Words: 2272 - Pages: 10
...1 Case study On Six Sigma at Wipro Technologies: Thrust on Quality Abstract: Six Sigma at Wipro Technologies: Thrust on Quality Wipro Technologies is a global services provider delivering technology-driven business solutions that meet the strategic objectives of clients. Wipro has 40+ ‘Centers of Excellence’ that create solutions around specific needs of industries. Wipro delivers unmatched business value to customers through a combination of process excellence, quality frameworks and service delivery innovation. Wipro is the World's first CMMi Level 5 certified software services company and the first outside USA to receive the IEEE Software Process Award. Wipro has one of the most mature Six Sigma programs in the industry ensuring that 91% of the projects are completed on schedule, much above the industry average of 55%. Six Sigma provides the tools for continuous improvement on existing processes thereby helping sustain the SEI-CMM Level 5 and CMMi certifications. This case focuses on the initiatives taken by Wipro Technologies to implement the Six Sigma Quality tool to achieve sustained strategic business results. It explores the implementation procedure at Wipro Technologies and the benefits reaped by the company on account of adopting Six Sigma. The case also throws light on the recent developments in the Six Sigma concept including Wipro’s Six Sigma Skill base and consulting experience and explains how the company intends to build its expertise and...
Words: 3598 - Pages: 15
...Control Charts and Introduction to Six Sigma Session 12: Control Charts and Introduction to Six Sigma concepts Control Charts and Introduction to Six Sigma Control Charts - Topics of Discussion – – – – – Control Chart History Control Limits Individuals and Moving Range Charts X-bar and R Charts Subgrouping Control Charts and Introduction to Six Sigma Typical Process Metrics • • • • • • • • • Cycle times Lead times Productivity Schedule variance Budget variance Employee satisfaction Customer satisfaction Safety incidents System users (# hits) • • • • • • • • • Days sales outstanding Customer service calls Request for quotes Proposal development Attrition/retention Bid win rate Transactional defects Sales orders Revenue dollars What are some metrics associated with your projects? What are some metrics associated with your projects? Control Charts and Introduction to Six Sigma Control Charts – “While every process displays Variation, some processes display controlled variation, while other processes display uncontrolled variation” (Walter Shewhart). – Controlled Variation is characterised by a stable and consistent pattern of variation over time. Associated with Common Causes. – Process A shows controlled variation. X-Bar Chart for Process A X-Bar Chart for Process A UCL=77.20 UCL=77.20 75 X a C a fo P ce B -B r h rt r ro ss 8 0 U L 7 .2 C= 7 7 Sample Mean 7 0 X= 0 8 7 .9 L L 6 .7 C= 4 0 6 0 5 0 Special Causes 0 5 1...
Words: 13809 - Pages: 56
...Quality Improvement: Six Sigma Individual Paper, Unit 6 Revised Research Paper Shelli Cornwell scornwell@capellauniversity.edu BUS3004 Developing a Business Perspective 12/18/2011 Introduction The primary focus of this paper is to introduce ways to incorporate quality improvement within an organization. Quality matters when servicing members, providers, employees, groups, brokers, etc. Ultimately, customers do not care about great productivity rates when on the receiving end of quality errors. Measuring quality throughout an organization should be the number one focus. There are many quality management tools available to an organization; however; Six Sigma is a strategy that many world class organizations have implemented to improve quality, service and customer satisfaction. The word Sigma is a statistical term that measures how far a given process deviates from perfection. An organization as a hole needs to embrace feedback on errors and determine solutions to these areas for improvement. And above all, there must be a better balance between productivity and quality. “Six Sigma improves production quality by removing variables that can cause defects” (Brinlee, n.d.). When a customer has to continuously spend time on the phone or in writing to have an issue resolved, this becomes frustrating to customers. When an organization has displeased customers due to defects in the quality of service, this can ultimately have an enormous impact on the reputation of an organization...
Words: 2256 - Pages: 10
...What is Balanced Scorecard? In the early 1990s, Balanced Scorecard was developed as a new approach to performance measurement due to troubles of short-termism and past orientation in management accounting (Kaplan and Norton 1992). Balanced scorecard is a strategic planning and management system that is widely used in business and industry, government, and nonprofit organizations to side with business activities to improve internal and external communications and monitor organization performance against strategic goals (Balanced Scorecard Basics n.d) The balanced scorecard has changed from its simple performance measurement structure to a full strategic planning and management system. The balanced scorecard has evolved from its early application as a simple performance measure framework to a full strategic planning, a simple public presentation-measuring framework to a full strategic planning (Balanced Scorecard Basics n.d).The new balanced scorecard transforms an eye-catching but unreceptive document into the "marching orders" for the organization on a daily basis. It offers a framework that provides performance measurements as well as helping planners identify what should be through and considered. It also enables executives to truly implement their policies (Balanced Scorecard Basics n.d) The balanced scorecard does not only focus on attaining financial objectives, furthermore, it emphasizes the nonfinancial objectives that an organization must accomplish to convene and...
Words: 2447 - Pages: 10
...Master Thesis Software Engineering Thesis no: MSE-2008-21 November 2008 Applying Six Sigma in Software Companies for Process Improvement Adnan Rafiq Khan Long Zhang School of Engineering Blekinge Institute of Technology Box 520 SE – 372 25 Ronneby Sweden This thesis is submitted to the School of Engineering at Blekinge Institute of Technology in partial fulfillment of the requirements for the degree of Master of Science in Software Engineering. The thesis is equivalent to 2*20 weeks of full time studies. Contact Information: Author(s): Adnan Rafiq Khan Address: Folkparksvagen 1905, 37240 Ronneby, Sweden. E-mail: adnanrafiqkhan@gmail.com Long Zhang Address: Villa Flora 951, 37236 Ronneby, Sweden. E-mail: zhl10154@gmail.com University advisor(s): Conny Johansson (Head of Department, Department of Systems and Software Engineering) School of Engineering Blekinge Institute of Technology Box 520 SE – 372 25 Ronneby Sweden Internet Phone Fax : www.bth.se/tek : +46 457 38 50 00 : + 46 457 271 25 ii ACKNOWLEDGEMENT First of all we thank our supervisor, Conny Johansson, for continuously providing the support, encouragement and motivation during the thesis. His advices, suggestions and feedbacks were really helpful and made this effort an enjoyable one. We are thankful to our faculty reviewer Dr. Robert Feldt. His feedbacks and comments were very useful to design this thesis. We would like to thanks Mr. Kai Xiao, a student at BTH, for introducing...
Words: 32055 - Pages: 129
...info@hospitalityupgrade.com. Management By Tina McCrossan Six Sigma Does it fit in hospitality? Depending upon whom you talk to, Six Sigma is either the most important new direction for change management in hospitality, or it’s a waste of time that has introduced armies of green and black belts getting in the way of doing business. Believers on both sides of the debate have a lot to say about why, in spite of this polarization, the methodology seems to be working in some organizations. Six Sigma leads companies down some interesting paths. You take your best people away from what they did before. You tell them to find, quantify, fix and measure results in any aspect of the business operation which attracts their interest. That’s a formula for organizational anxiety. However if approached correctly, Six Sigma programs don’t have to breed conflict. In hospitality many necessary projects never get funded because of the unique capital budget challenges in the industry. Wolfgang Ebenbichler, the former VP of F&B at the Gaylord Opryland, said, “Everyone has projects they know need to get done to achieve forecasted growth, but can’t seem to get corporate approval. Six Sigma specialists are trained to quantify benefits and long-term effects on revenues and profitability – they can get those vital projects off the ground.” Often an alliance is formed between operations teams who want projects funded and Six Sigma teams who can document the necessary ROI to get...
Words: 1457 - Pages: 6
...Int. J. Six Sigma and Competitive Advantage, Vol. x, No. x, xxxx 1 Six Sigma and Total Quality Management: different day, same soup? Bengt Klefsjö* and Bjarne Bergquist Division of Quality and Environmental Management, Luleå University of Technology, SE-971 87 Luleå, Sweden E-mail: Bengt.Klefsjo@ltu.se E-mail: Bjarne.Bergquist@ltu.se *Corresponding author Rick L. Edgeman Department of Statistics, University of Idaho, Moscow, Idaho 83844-1104, USA E-mail: redgeman@uidaho.edu Abstract: For decades now TQM has been a dominant management concept for improving competitiveness and financial results. In recent years, however, TQM seems to have lost some of its nimbus with other concepts and approaches such as Lean Enterprise and Six Sigma launched and increasingly in vogue. The aim of this paper is to look at TQM and Six Sigma, their backgrounds, definitions and ingredients, and their similarities and differences to see whether the two concepts really are different dishes or contain the same ingredients in different proportions. Keywords: quality; Quality Management; Six Sigma; Total Quality Management (TQM). Reference to this paper should be made as follows: Klefsjö, B., Bergquist, B. and Edgeman, R.L. (xxxx) ‘Six Sigma and Total Quality Management: different day, same soup?’, Int. J. Six Sigma and Competitive Advantage, Vol. x, No. x, pp.xxx–xxx. Biographical notes: Bengt Klefsjö is a Professor of Quality Technology and Management at Luleå University of Technology in Sweden...
Words: 9146 - Pages: 37
...strategies for growth and operations excellence. He has led new developments in the Coca-Cola supply chain around the globe, from bottler consolidation in North America in the 1980s, to procurement and supply chain strategies in Argentina in the ’90s. In the mid-2000s, Buffington took over management responsibility for the Bottling Investment Group in Brazil, Uruguay, India, Philippines and Singapore as Coca-Cola focused on strengthening bottlers in these key markets. Since 2009, Buffington has been responsible for development and implementation of strategies to support and enhance the Coca-Cola supply chain system. LOCAL SERVICE To be able to offer that localized customer service worldwide, Coca-Cola six years ago established the world’s largest lean-Six Sigma supply chain operation to leverage best practices, processes and operational excellence programs. “It’s all about being local, being responsive, being market-driven and also being able to leverage the brand, the innovation, the technology and what we’ve learned of best practices in our global system,” Buffington explains. The key elements for Coca-Cola’s operational excellence programs are “culture and capability,” according to Buffington. “It’s very important that all of our 700,000 employees – whether they’re administrative, financial, merchandising or delivery – have a...
Words: 1096 - Pages: 5
...implement to allow them to squeeze even further profit out of their current systems. * APPLE | IPHONE 5 – SIPOC : Companies introducing Lean Six Sigma for process improvement in its organization, demand a clear understanding of its current processes. SIPOC is an effective tool used in the initial Define stage of the DMAIC life cycle for high-level process mapping of key processes. SIPOC is an acronym for Supplier, Inputs, Process, Outputs and Customers. Each of these terms are explained in detail as follows: * Suppliers are the significant internal/external providers of material/input data to the process. * Inputs are significant physical/data inputs provided by the suppliers to undergo a process. * Process is the current method used in sequence of four to seven steps that add value to the Inputs. * Outputs are significant process results delivered to customers. * Customers are the internal/external recipients of the Outputs. A team of 3-9 stakeholders or team members, who have knowledge of the process, typically develops SIPOC. A facilitated brain storming session is conducted by a certified facilitator to identity the five key components (SIPOC). A consensus is reached so that all the members view a particular process in the same way. [1] A SIPOC process map can be created during two stages in the Lean Six Sigma Deployment Life Cycle as follows. 1. Pre-Project Selection Stage SIPOC of the company's key processes provides a comparable visualizations...
Words: 1178 - Pages: 5
...[2] What is Welch’s objective in the series of initiatives he launched in the late 1980s and early 1990s? What is he trying to achieve in the round of changes he put in motion in that period? Is there a logic or rationale supporting the change process? We can say that Welch’s approach to business improvement has gone through three different cycles of learning: a) In the first cycle (from early 1980s to late 1980s) he focused GE on the elimination of variety in its portfolio of businesses by reducing the nonperforming businesses. He launched the “#1 or #2” approach. The central idea that guided GE’s business decisions was that those business areas that intended to compete in global markets must either be or become number-one or number-two in their market places. Those businesses that had no chance of attaining this goal were to be fixed, either sold or closed. During this stage almost 200 businesses were sold off and more than 370 acquisitions were achieved. The rationale behind managing the portfolio of businesses was to ensure that GE would make the best use of its capital for appropriate investments. To strengthen this measure, Welch eliminated the sector level, ensuring that all businesses reported directly to him, situation that would create more pressure and control on the businesses’ CEO to deliver results. b) In the second cycle (from late 1980s to mid-1990s), once GE had focused itself on targeted business areas, Welch focused the company on simplifying and...
Words: 860 - Pages: 4
...Chapter 1 Lecture Notes Chapter theme: This chapter describes the larger business environment within which management accounting operates. It is divided into nine sections: (1) globalization, (2) strategy, (3) organizational structure, (4) process management, (5) the importance of ethics in business, (6) corporate governance, (7) enterprise risk management, (8) corporate social responsibility, and (9) the Certified Management Accountant. I. Globalization 1 A. Import/Export Data i. 2 Imports into the United States (in billions) 1. The data reveal an enormous increase in import activity from 1995 to 2007. In particular, imports from Canada, Mexico, and China skyrocketed. ii. Exports from the United States (in billions) 1. The data reveal an increase in exports to Canada and Mexico. Interestingly, the increase in exports to China pales in comparison to the growth rate in imports from China. iii. 4 Internet Usage 1. The internet fuels globalization by providing companies with greater access to 1 3 4 geographically dispersed customers, employees, and suppliers. 2. While the number of internet users continues to grow, as of 2008, more than 78% of the world’s population was still not connected to the Internet. This suggests the Internet’s impact on business has yet to fully develop. II. Strategy A. Definition 5 i. A strategy is a ―game plan‖ that enables a company to attract customers by distinguishing itself from competitors. B. Customer value propositions i....
Words: 2479 - Pages: 10
...WHAT IS SIX SIGMA? PETE PANDE LARRY HOLPP McGraw-Hill New York Chicago San Francisco Lisbon London Madrid Mexico City Milan New Delhi San Juan Seoul Singapore Sydney Toronto McGraw-Hill abc Copyright © 2002 by The McGraw-Hill Companies,Inc. All rights reserved. Manufactured in the United States of America. Except as permitted under the United States Copyright Act of 1976, no part of this publication may be reproduced or distributed in any form or by any means, or stored in a database or retrieval system, without the prior written permission of the publisher. X-XX-XXXXX-X The material in this eBook also appears in the print version of this title: 0-07-138185-6. All trademarks are trademarks of their respective owners. Rather than put a trademark symbol after every occurrence of a trademarked name, we use names in an editorial fashion only, and to the benefit of the trademark owner, with no intention of infringement of the trademark. Where such designations appear in this book, they have been printed with initial caps. McGraw-Hill eBooks are available at special quantity discounts to use as premiums and sales promotions, or for use in corporate training programs. For more information, please contact George Hoare, Special Sales, at george_hoare@mcgraw-hill.com or (212) 904-4069. TERMS OF USE This is a copyrighted work and The McGraw-Hill Companies, Inc. (“McGraw-Hill”) and its licensors reserve all rights in and to the work. Use of this work is subject to these...
Words: 25208 - Pages: 101
...& television; new business ventures; and a music label (RocNation, 2015). The company has added other entities since their initial startup. Roc Nation Sports, a division of Roc Nation, launched in spring 2013 (RocNation, 2015). The organization use the supply chain to gain competitive advantage within the entertainment industry and still considering three categories of improvement such as cycle time, quality, cost concerns and developments. Cycle time measures the amount of time according to the unit using minutes and customer hours adding and subtracting one from another will not provide an average value (International Six Sigma Institute, 2015). Quality reduces variation of processes surrounding targets to include goals, objectives, mission, and organizations vision eliminating faults, failures, and satisfying customer expectations (International Six Sigma Institute, 2015). Cost basis is the term used for the tax cost of an asset. It usually starts out as the purchase price (plus commissions and fees) but "stuff" happens that can cause it to change. Things called corporate actions occur such as stock spinoffs, mergers, splits, split-offs, rights, or return of capital, all of which affect your cost basis (CostBasis.com Inc, 2008-2015). The three categories of development enhance business productivity though assisted challenges such as cycle time steps and is not an unrelated practice to calculate lead time. The business must know the drudgery in course to calculate cycle...
Words: 1194 - Pages: 5
...THE SIX SIGMA WAY This page intentionally left blank. THE SIX SIGMA WAY How GE, Motorola, and Other Top Companies Are Honing Their Performance PETER S. PANDE ROBERT P. NEUMAN ROLAND R. CAVANAGH McGraw-Hill New York San Francisco Washington, D.C. Auckland Bogotá Caracas Lisbon London Madrid Mexico City Milan Montreal New Delhi San Juan Singapore Sydney Tokyo Toronto Copyright © 2000 by The McGraw-Hill Companies, Inc. All rights reserved. Manufactured in the United States of America. Except as permitted under the United States Copyright Act of 1976, no part of this publication may be reproduced or distributed in any form or by any means, or stored in a database or retrieval system, without the prior written permission of the publisher. 0-07-137667-4 The material in this eBook also appears in the print version of this title: 0-07-135806-4. All trademarks are trademarks of their respective owners. Rather than put a trademark symbol after every occurrence of a trademarked name, we use names in an editorial fashion only, and to the benefit of the trademark owner, with no intention of infringement of the trademark. Where such designations appear in this book, they have been printed with initial caps. McGraw-Hill eBooks are available at special quantity discounts to use as premiums and sales promotions, or for use in corporate training programs. For more information, please contact George Hoare, Special Sales, at george_hoare@mcgraw-hill.com or (212) 904-4069. ...
Words: 22229 - Pages: 89
