6 sigma tpoics from aig blog

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Lean and Six Sigma Talent Demand Surges 90% Over Recession Levels

Companies flush with strong balance sheets after taking drastic actions during the recession are

clearly making aggressive moves to bolster their internal talent pools by seeking both Lean andSix Sigma talent, according to the latest study of almost 6,700 recent Internet job postings

reviewed by Advance Innovation Group (http://www.advanceinnovationgroup.com). Theexecutive search firm's annual study found that the combined demand for Lean and Six Sigmatalent has almost doubled, rising by over 90 percent versus last year's recession levels.

"This year's dramatic overall talent demand increase for Lean and Six Sigma skills may have

more to do with insuring ongoing corporate performance and leveraging expected rising demandversus an early signal of overall hiring," states Binny Arora, managing principal and partner of

Advance Innovation Group. "Companies are seeking Lean and Six Sigma talent as a way to helptheir organizations better leverage their performance during the ongoing recovery. They don't

want to add back one-for-one on headcount, inventory and operating cost as the economyrecovers and volume returns. Rather, they see continuous improvement talent as an enabler to

help them gain and maintain significant performance leverage."

For the first time in seven consecutive studies by Advance Innovation Group, this year's studyshowed little to no year-over-year change on the relative balance between Lean and Six Sigma

talent demand. This year's study found that Lean talent demand continues to outpace Six Sigma by almost 35 percent, in-line with last year's study. Nonetheless, this is still a dramatic shift from

Advance Innovation Group's inaugural Lean and Six Sigma talent demand study that showed SixSigma talent demand exceeding Lean by more than 50 percent.

Almost exactly in-line with last year, this year's study found that for companies seeking Leantalent, only 41 percent require candidates to possess Six Sigma knowledge as well, a requirement

that has continued to decline in Advance Innovation Group's previous talent demand studies. Onthe other hand, for companies seeking Six Sigma talent, almost 55 percent are now requiring

candidates to possess Lean knowledge as well, a requirement that has steadily grown in previousstudies.

"These results continue to show an overall bias for Lean skills, perhaps as an ongoing hedge

against the challenges of today's economic climate, which Lean's more immediate and practicalfocus on waste, flow and flexibility may better serve," states Binny. "It may also indicate that

companies are continuing to balance out their continuous improvement talent stable with Leancandidates versus slightly more ubiquitous Six Sigma talent."

Overall, Arora concludes, this sharp rise in talent demand for Six Sigma and Lean bodes well for candidates who possess these skills, as organizations seek them out as either a hedge againstcurrent economic uncertainty or as an enabler to leverage the emerging economic recovery.



How is Process Capability determined?

There are two ways of calculating Process Capability, depending on whether the data is discrete or

continuous.

Discrete data has isolated values, like number of employees, business unit codes (BUCs) and fields in arecord. Integer values are more common than decimals or fractions.

Continuous data in contrast can be measured to any degree of accuracy, like time or distance. The

project leader will pick a level of accuracy, such as 14.2 seconds rather than 14.20456 seconds, based on

the projected magnitude of the improvement. The decimal numbers do not play a big role when

response time goes from 14 seconds to 4.

In the case of currency, it is better to treat dollars like continuous data, even though a cent is a discrete

number. That is because analysis tools are richer for continuous data.

Let us first consider discrete data. You count the defects, meaning the events or other outcomes that

fail to meet customer specifications, and compare that number to the total opportunities. An

opportunity is anything that can meet or fail to meet customer expectations.

For example: If an End User Computing (EUC) service has 76 spare keyboards on hand, and an audit

found 5 that are inoperative, then you have 5 defects out of 76 opportunities. That equates to 6.6%

defects and 93.4% good.

The defect percentage is translated into a Z-score via a table, Excel or the MiniTab Six Sigma Product

Report.

6.6% defects equates to a Z-score of 1.5, also called the sigma level. That is your process capability.

For continuous data, other concepts come into play. For one, you are more likely to collect data over

time, rather than in on snapshot. Processes can drift slowly.

The rules say that you analyze data in this order: stability, shape, spread and centering.

A test of stability, as measured by a Run Chart in MiniTab, uncovers trends, clustering, oscillations and

other patterns. These have to be resolved before further analysis takes place.

The shape describes the frequency distribution. A normal shape, as depicted via a bell shaped curve,

proves that random causes contribute to variation.

Spread is the variation of the data around a center.

Finally, the mean and median are ways to describe centering.



MiniTabsDescriptive Statistics give information about shape, spread and centering

Specification Limits

For continuous data, in order to assess the process capability, you need limits defined by the user.

The limits describe a range of acceptable values, bounded by upper and lower spec limits (USL and LSL).

In some situations, we have only a USL or we have only an LSL, meaning that all values in the opposite

direction are good outcomes.

Examples of spec limits:

± If an on-line application fails, it must come back up within 15 minutes. 15 minutes is an

Upper Spec Limit (USL).

± To avoid overdrafts, bank accounts should not have less than $15,000. The amount is aLower Spec Limit (LSL).

± The amount of text on a PowerPoint slide should be between 50 and 150 words, title

pages excepted. There is a Lower Spec Limit (LSL) of 50 and an Upper Spec Limit (USL)

of 150.

The Z-score

The yardstick for measuring process capability is a Z-score.

Be sure that the process is stable and that it exhibits only random variation around a center. Think of

sugar frosted donuts. They should all be the same size, 13 cm. The frequency distribution is a bell

shaped curve known as the normal curve. Below is the result of measuring 100 donuts.



Difference between Control Limit and Specification Limit?

Control Limits are the Limits of Variation that is expected from a process when the process is

said to be in statistical control. Calling a process under statistical control means all the variationin the process is resulted by Common (Random) Cause only. Such process generally shows

consistency in their performance over time. Any variation that occurs outside control limits issaid to be coming because of special cause. Such processes are difficult to predict for future performance. Control limit is property of process (Data). Control limit of any process signifies

that all the variation from expected source falls within this limit. Generally, a very small portionof variation is only contributed by special cause, because if huge variation is contributed by a

source then that source cannot be special rather that becomes common.

Specification limit is the limit set by customer. Generally there are two types of specification

limit i.e. LSL (Lower Specification Limit) and USL (Upper Specification Limit) These limits

quantify the requirement of customer (CTQ).If our product falls in the range of USL/LSL the product is said to be meeting our customer¶s expectation. If our product does not fall in the range

of USL/LSL, then our product is said to be not satisfying our customer need.

Specification limit and Control limits are two different measurements. As a Black Belt we mightnot have much control over customer¶s specification but we can work on changing control limits.

Again shifting or changing control limit is a time taking task. So we may have to work hard toshift/change control limit according to specification limit provided to us by our customer.

Relation between Control Limit and Specification Limit

1)When Specification Limit Falls Between Control Limit.

As demonstrated in the given Graph. When Control limits exceeds the specification Limit some

part of the process will be functioning outside the Specification range. That Means Whenever Range of control limits is greater than range of specification limit, your process will be

producing defects.



Satish Mishra

Sr. Consultant

Six Sigma is a Business Management Strategy

Six Sigma is a business management strategy, originally developed by Motorola that today enjoys wide-

spread application in many sectors of industry.

Six Sigma seeks to identify and remove the causes of defects and errors in Manufacturing and/orservice delivery and business processes. It uses a set Of management methods, including statisticalmethods, and creates a dedicated infrastructure of people within the organization who are experts inthese methods. Six Sigma aims to deliver ´Breakthrough Performance Improvementµ from currentlevels) in business and customer relevant operational and performance measures.

Business or operational measures are elements like:

� Customer Satisfaction Rating Score

� Time taken to respond to customer queries or complaints

� % Defect rate in Manufacturing

� Cost of executing a business process transaction

� Yield (Productivity) of service operations or production

� Inventory turns (or) Days of Inventory carried

� Billing and Cash Collection lead time

� Equipment Efficiency (Downtime, time taken to fix etc.)

� Accident / Incident rate

� Time taken to recruit personnel and so on«



Six Sigma ² Historical background Six was originally developed as a set of practices designed to improve manufacturing processes andeliminate defects, but its application was subsequently extended to many other types of business

processes as well. In Six Sigma, a defect is defined as anything that could lead to customerdissatisfaction and / or does not meet business set specifications. The elements of the methodologywere first formulated by Bill Smith at Motorola in 1986. Six Sigma was heavily inspired by six precedingdecades of quality improvement methodologies such as quality control, TQM, and ZeroDefects, basedon the work of pioneers such as Shewhart, Deming, Juran,Ishikawa, Taguchi and others.The term "SixSigma" is derived from a field of statistics known as process capability study. It refers to the ability ofprocesses to produce a very high proportion of output within specification. Processes that operatewith "Six sigma quality" over the short term are assumed to produce (long-term) defect levels below3.4 defects per million opportunities (DPMO).Six Sigma's implicit goal is to improve all processes tothat level of quality or better.

Six Sigma Benefits

Leading companies have implemented Six Sigma and realized gainful results. Motorola hasreported over US$17 billion in savings from Six Sigma as of 2006. Other early adopters of Six

Sigma who achieved well-publicized success include Honeywell International and General

Electric (introduced by Jack Welch). By the late 1990s, about two-thirds of the Fortune 500

organizations had begun Six Sigma initiatives with the aim of reducing costs and improvingquality.

Risk Assessment It is a common discussion during an information security risk assessment exercise at most

of the organizations. As a general practice the asset value is derived by weighing the confidentiality ©, Integrity (I)and availability (A) value of an asset. While the assets are categorized into Information, Hardware, Software,

Service and People, my argument always has been to say that C-I-A values can be assessed for Information Assets

only and for all other it should just be the availability value.

Now, let¶s look at what is the definition of information assets. Information assets are basically data that is in transit

or at rest and also that are available on papers. Having this in mind, I think it is easier to assess the C-I-A values of

these assets. Let us take an example:

Contract documents is an information asset or let¶s take the file server in an organization, the ³data´ in the file server is an information asset. How much impact the organization would have, if the information in the document isexposed to unauthorized persons..? ± if the impact is less, confidentiality value is less and if the impact is high,

confidentiality value is high. Similarly, this is applicable for Integrity and Availability. If the impact is high bylosing the integrity or availability, it will be rated high or else low. After determining the C-I-A values the asset

value is derived by either taking the highest value or with some simple calculations.

Let¶s consider the C-I-A values for a hardware asset. The confidentiality value of the hardware asset is derived by

the information that it holds and hence I feel that there would be duplication if we consider the confidentiality value

here. We are considering the hardware asset as a whole and hence integrity of the server is not applicable here.

Availability value is what we need to consider for an hardware asset.



As we have looked into the hardware asset, the same applies to software and service assets. Now let us look at the

people asset.

If we are trying to consider the C-I-A values of a person, let¶s say the CEO of the organization, yes he hasconfidential information. But how do we assess the confidentiality value? It is hard to determine the information that

he is holding in his memory and it might also be varying constantly. Which means you cannot determine the ³C´either as high or low at given point in time. I am not quite sure about the integrity aspect and coming down to theavailability value; this definitely needs to be assessed.

Again, the availability value of people asset according to me should always be set to high, irrespective of his

designation, age, gender etc. Why?

Controls are implemented based on the derived risk value. Risk value is proportionate to the asset value, which

means if the asset value increases, so does the risk value. In this context, let us take an example:

Contract document (Information Asset) C-I-A = 5 * Threat = 3 * Probability = 3 = 45 (Risk Value)

IT Manager (People Asset) A = 3 * Threat = 3 * Probability = 1 = 9 (Risk Value)

In the above scenario, the information asset has a risk value higher that the people asset. If there is a fire break out in

the organization, which of these assets will be well protected or rescued? People will always be considered firstduring a disaster and hence the asset value of people should always be rated as high. In this case you may ask, we

already know that people is first, then why should be even consider listing people asset in the risk assessment

exercise? Well, Your thoughts

I would even look to see why we need to consider hardware, software and service assets for the assessment, because

all the values are anyway dependent on the information it holds or transmits.

When the employee says, 'I quit!'

Even the best employer has to face the many repercussions created due to a valuable employee'sunprecedented exit. But the key lies in tactfully and constructively addressing issues related toemployee resignation.

Shouldering responsibilities

When an employee resigns, whether or not he/she is amongst the one who shoulders theresponsibilities, it can cause a disruption in the workflow of the team. There are so many loose

ends to tie and in order not to let the productivity get affected, HR has to come up with solutionsthat will create as little bumps in the work process as possible.

"When an employee quits, the HR personnel's sole motive should be to handle the team losing

the member. Everyone has a set of responsibilities and that is how the team is able to give theend result, right? So, it is vital to handle an employee's resignation in a sensitive manner,

considering the consequences," says Ratan Jain, CEO, Glitters Import.

Responsibility divisionThe HR manager can first address the issue of responsibility division amongst the existing team

members. "When an employee quits, the first task at hand is to divide his/her responsibilities incase there is no replacement found till then. Also, the team cannot stop functioning and the other



members should also not feel burdened with excessive duties. So, this has to be handled withutmost care," says Paresh Rawat, recruiting head, Shah Transport and Engineering Co.

Hiring

Apart from the duties that have to be split, there also remains the task of hiring someone who

will be able to match up to the team's expectation of the previous employee. In an organization,the teams that work together usually have their own set dynamics, which help them, perform better. The dynamics of the team may be a little difficult for the newcomer to handle. "In such a

situation, HR can smoothen the way in for the new employee and ensure that the team as well asthe new employee is comfortable with each other. This can be done by conducting an induction

session for the specific team only so that they know each other under informal circumstances,"adds Jain.

Gage R&R Study

Gage R&R Study

Use Gage R&R study to determine what portion of the variation in measurements may be due

to the measurement system. Measurement system variation includes variation due to the

Equipment and Operator variation.

Use Gage R&R Study (Crossed) when each part is measured multiple times by each operator.

Use Gage R&R Study (Nested) when each part is measured by only one operator, such as in

destructive testing. In destructive testing, the measured characteristic is different after the

measurement process than it was at the beginning. Medicine testing is an example of

destructive testing.

Minitab provides two methods for assessing repeatability and reproducibility:

X bar R & R and ANOVA.

The X bar R & R method breaks down the overall variation into 3 categories:

y Part-to-Part, repeatability, and reproducibility.

The ANOVA method goes one step further and breaks down reproducibility into its operator,

and Operator-by-part.

The ANOVA method is more accurate than the X bar R & R method, because it considers the

operator by part interaction.



Gage R&R Study (Crossed) allows you to choose between the X bar R & R method and the

ANOVA method.

Gage R&R Study (Crossed)

Structure your data so that each row contains the part name or number, operator and the

observed measurement. Parts and operators can be text or numbers. The Gage R&R studies

require balanced designs (equal numbers of observations per cell) and replicates.

To do a Gage R&R Study (Crossed) in Minitab

1 Choose Stat -- Quality Tools -- Gage R&R Study Crossed)

We trying to conducted Gage R&R study on a sample size of AHT (Average handled

time) data which was pulled from the Application.

1. This was done to fix leakages which are happening either due to the Application

(Equipment) and Operator (the resource who had extracted AHT data from theapplication).

2. This is being done to ensure that the data is Accurate, Repeatable and Reproducible. If

the Gage R&R study is successful the data can be used for further analysis.

Data File Part (Dates) Operator Measurement9AHT in Mins)

January 1st 2010 Binny 11



January 1st 2010 Binny 11 January 1st 2010 Vivek 11.2 January 1st 2010 Vivek 11 January 1st 2010 Jai 11.5 January 1st 2010 Jai 11.7 January 2nd 2010 Binny 13 January 2nd 2010 Binny 12.8 January 2nd 2010 Vivek 12.9 January 2nd 2010 Vivek 12.87 January 2nd 2010 Jai 12.77 January 2nd 2010 Jai 12.67 January 3rd 2010 Binny 15 January 3rd 2010 Binny 14.89 January 3rd 2010 Vivek 15.2 January 3rd 2010 Vivek 15.1 January 3rd 2010 Jai 14.9 January 3rd 2010 Jai 15

1. In Part numbers, enter the column of part names or numbers.

2. In Operators, enter the column of operator names or numbers.

3. In Measurement data, enter the column of measurements, then click OK.



Cp and Cpk Explained

Cp (Process Potential Index)

Cp refers to inherent capability of a process by design. Cp explains whether normal variation of a

process is within the specification limit or it is exceeding specification limits.Cp can be

expressed mathematically as follows

If we study the above ratio carefully, we find this ratio explains how well 6Sigma (i.e. normal

spread of my process) fits within tolerance.

Cp explains potential of any process i.e. how much a process can achieve

1) When Cp is less than 1.



From above formulae Cp will be smaller than one only when 6Sigma (i.e. normal spread of the process) exceeds specification limit. That means when Cp of you process is less than one in that

case even if your process behavior is normal but it will not be able to meet customer specification. This process by design only is not able to meet customer specification

2) When Cp is equal to 1.

Cp of a process will be equal to one only when normal variation of the process will exactly fit

between USL and LSL (as shown in below picture). Cp of your process is one that means if your

process functions normally then it will meet customer specification.

3) When Cp is greater than 1

This is probably the best design your process can have. In such design normal variation of your

process will be smaller than the specification range (as shown in following picture). In such

design your process will not be producing defect.

Cpk (Process Performance Index)



Team Member:- Professional who has general awareness of Six Sigma (through no formal training) and

who brings relevant experience or expertise to a particular project.

Process Owner:- Professional responsible for the business process that is the target of a Six Sigma

project.

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