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What is Six Sigma?

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Six Sigma Methodology

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SIX SIGMA RESOURCE LIBRARY

Six Sigma Methodology

Simply defined, the Six Sigma approach identifies and eliminates defects with a structured, data-driven, problem-solving method of using rigorous data-gathering and statistical analysis.

Six Sigma is a methodology that provides businesses with the tools to improve the capability of their business processes. This increase in performance and decrease in process variation leads to defect reduction and vast improvement in profits, employee morale and quality of product. This approach starts with the customer by defining what is critical to quality and ends by producing superior results for the customer. Customers will pay only a certain price for a company’s products or services, whether the company gets it done right the first time or the fifth time!

Using Six Sigma Will Guide Your Firm to:

  • Improve Customer Satisfaction

    Increase Profit Margins

    Shorten Cycle Times

    Reduce Costs

In most companies today, the cost of poor quality represents 20% to 30% of total revenues. The Six Sigma approach implements proven methodologies for carving out these costs while reaching world-class quality levels by focusing on breakthrough performance (improvements of 50% or more).

Six Sigma differs from traditional performance improvement programs in its focus on input variables. While traditional methods depend on measuring outputs and establishing control plans to shield customers from organizational defects, a Six Sigma program demands that problems be addressed at the root level, eliminating the need for unnecessary inspection and rework processes.

Focusing the Six Sigma tools at virtually any properly scoped project will drive savings to your bottom line. Financially, the first set of projects usually justifies the entire cost of the Six Sigma training.

EXAMPLES

A High Tech Manufacturer found the Development Unit of a cooling system had numerous and redundant inspection steps, which were pushing costs out of line. Six Sigma was applied, reducing the number of inspection steps and eliminating redundant inspections, resulting in a $1,300,000 savings.
Clients of a Mutual Fund Company were unable to make informed decisions because asset values on the website did not have timely updates. Six Sigma was applied, improving processes, resulting in timely updates, retention of key clients and a 20% reduction in operating costs.

Excessive rejects at a Glass Manufacturer were caused due to scratches and chips created by contaminate in a critical production process. Six Sigma was applied, reducing rejects by 92%, improving line up-time by 79% and realizing $840,000 in annual cost savings.

An Accounting Department’s delinquent accounts receivable had remained above $7,000,000 for the past 12 months. Six Sigma was applied, establishing new processes, improving cash flow and finance charges and saving over $350,000 annually.

A Rubber Manufacturer was unable to perform fast mold changes, impacting delivery schedules and customer satisfaction. Six Sigma was applied, reducing mold change time 53% and creating $525,000 in sales capacity.


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