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1 The Six Sigma HandbookA Complete Guide for Green Belts, Black Belts, and Managers at All LevelsThomas PyzdekPaul A. KellerThird Edition New York Chicago San Francisco Lisbon London Madrid Mexico City Milan New Delhi San Juan Seoul Singapore Sydney TorontoCopyright 2010, 2003, 2001 by The McGraw-Hill Companies, All rights reserved. Except as permitted under theUnited States Copyright Act of 1976, no part of this publication may be reproduced or distributed in any form or by anymeans, or stored in a database or retrieval system, without the prior written permission of the : 978-0-07-162337-7 MHID: 0-07-162337-XThe material in this eBook also appears in the print version of this title: ISBN: 978-0-07-162338-4, MHID: trademarks are trademarks of their respective owners.

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6 This limitation of liability shall apply to any claim or cause whatsoever whether suchclaim or cause arises in contract, tort or .. xi Part I Six Sigma Implementation and Management 1 Building the Responsive Six Sigma Organization .. 3 What Is Six Sigma? .. 3 Why Six Sigma? .. 4 The Six Sigma Philosophy .. 5 The Change Imperative .. 11 Implementing Six Sigma .. 13 Timetable .. 14 Infrastructure .. 16 Integrating Six Sigma and Related Initiatives .. 32 Deployment to the Supply Chain .. 34 Communications and Awareness .. 36 2 Recognizing Opportunity.

7 43 Becoming a Customer and Market-Driven Enterprise .. 44 Elements of the Transformed Organization .. 46 Strategies for Communicating with Customers and Employees .. 48 Survey Development Case Study .. 52 Calculating the Value of Customer Retention .. 58 Customer Expectations, Priorities, Needs, and Voice .. 60 Quality Function Deployment .. 61 The Six Sigma Process Enterprise .. 65 The Source of Confl ict .. 67A Resolution to the Confl ict .. 67 Six Sigma and the Process Enterprise .. 70 Linking Six Sigma Projects to Strategies .. 71 The Strategy Deployment Matrix.

8 71 Deploying Differentiators to Operations .. 74 Deploying Operations Plans to Projects .. 75 Interpretation .. 76 Linking Customer Demands to Budgets .. 77 Structured Decision-Making .. 77iii 3 Data-Driven Management .. 87 Attributes of Good Metrics .. 87 The Balanced Scorecard .. 89 Measuring Causes and Effects .. 90 Customer Perspective .. 92 Internal Process Perspective .. 94 Innovation and Learning Perspective .. 95 Financial Perspective .. 95 Cost of Poor Quality .. 97 Cost of Quality Examples .. 99 Strategy Deployment Plan.

9 102 Dashboard Design .. 105 Information Systems Requirements .. 107 Integrating Six Sigma with Other Information Systems Technologies .. 108 Data Warehousing .. 108 OLAP .. 110 Data Mining .. 110 OLAP, Data Mining, and Six Sigma .. 112 Benchmarking .. 112 The Benchmarking Process .. 112 Getting Started with Benchmarking .. 113 Why Benchmarking Efforts Fail .. 114 The Benefi ts of Benchmarking .. 116 Some Dangers of Benchmarking .. 116 4 Maximizing Resources .. 117 Choosing the Right Projects .. 117 Types of Projects.

10 117 Analyzing Project Candidates .. 118 Using Pareto Analysis to Identify Six Sigma Project Candidates .. 125 Throughput-Based Project Selection .. 127 Ongoing Management Support .. 133 Internal Roadblocks .. 133 External Roadblocks .. 134 Individual Barriers to Change .. 134 Ineffective Management Support Strategies .. 135 Effective Management Support Strategies .. 136 Cross-Functional Collaboration .. 136 Tracking Six Sigma Project Results .. 137 Financial Results Validation .. 138 Team Performance Evaluation.