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Six Sigma and the Product Development Cycle This page intentionally left blank Six Sigma and the Product Development Cycle Graham Wilson AMSTERDAM • BOSTON • HEIDELBERG • LONDON • NEW YORK • OXFORD PARIS • SAN DIEGO • SAN FRANCISCO • SINGAPORE • SYDNEY • TOKYO Elsevier Butterworth-Heinemann Linacre House, Jordan Hill, Oxford OX2 8DP 30 Corporate Drive, Burlington, MA 01803 First published 2005 Copyright © 2005, Graham Wilson All rights reserved The right of Graham Wilson to be identified as the author of this work has been asserted in accordance with the Copyright, Designs and Patents Act 1988 No part of this publication may be reproduced in any material form (including photocopying or storing in any medium by electronic means and whether or not transiently or incidentally to some other use of this publication) without the written permission of the copyright holder except in accordance with the provisions of the Copyright, Designs and Patents Act 1988 or under the terms of a licence issued by the Copyright Licensing Agency Ltd, 90 Tottenham Court Road, London, England W1T 4LP Applications for the copyright holder’s written permission to reproduce any part of this publication should be addressed to the publisher Permissions may be sought directly from Elsevier’s Science & Technology Rights Department in Oxford, UK: phone: (ϩ44) 1865 843830, fax: (ϩ44) 1865 853333, e-mail: permissions@elsevier.co.uk You may also complete your request on-line via the Elsevier homepage (http://www.elsevier.com), by selecting ‘Customer Support’ and then ‘Obtaining Permissions’ British Library Cataloguing in Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloguing in Publication Data A catalogue record for this book is available from the Library of Congress ISBN 7506 6218 For information on all Elsevier Butterworth-Heinemann publications visit our website at www.bh.com Typeset by Charon Tec Pvt Ltd, Chennai, India www.charontec.com Printed and bound in Great Britain by Biddles Ltd, Kings Lynn, Norfolk Contents About the author vi Preface vii Acknowledgements x Culture What is six sigma? 12 The transformation that is six sigma 27 The product development cycle 48 Quality function deployment 69 Taguchi’s techniques 107 Statistical process control 179 Appendix F-statistics (95% confidence) 221 Appendix F-statistics (99% confidence) 222 Appendix Logarithms (base 10) 223 Appendix Decibel values 224 Appendix Quality function deployment house of quality summary 225 Appendix Capability report form 226 Appendix Attribute data control chart 227 Appendix Variables data control chart 228 Index 229 About the author Graham Wilson works behind the scenes with executives in a small number of well-known companies as they progressively transform their organization and, in turn, themselves He originally studied behavioural science and was awarded his PhD by the University of Bristol After a spell at a leading London teaching hospital, he joined Exxon, where he worked as an internal consultant specializing in workplace change, employee empowerment and quality improvement His career has taken him around the world and continues to provide a wealth of exciting and unusual situations in which to learn He has been a part of the leadership team of a number of start-ups and, in an interim role, within a number of established companies undergoing radical transformation While he balances a portfolio career involving writing, inspirational speaking and coaching, he is a non-executive director and serves as a charity trustee Graham has a particular interest in the strategic opportunities that the future holds for organizations and individuals He can be contacted via his website (www.grahamwilson.org) Preface Some management concepts seem to be so pivotal at the time they are first mooted and yet all too soon they disappear from the vocabulary and the next one takes over At first sight six sigma ought to be one of these It is a tough concept to understand, being rooted in statistics The standard it demands is hard to imagine happening in most organizations The kind of mindset that is needed to make it work is dedicated and unswerving It is not an overnight fix, typically taking several years before an organization can really claim to have ‘made it’ Twelve years ago, in 1992, I not think many observers would have thought that six sigma would last more than five years or so Nevertheless, it seemed to me at the time that this was an important approach At the time I was working as an organization development specialist across several industry sectors Despite six sigma having particular appeal to people of an engineering persuasion, the issue that my clients kept returning to was its potential to eliminate so much of the cost of developing new products With one or two in particular, they had no alternative but to focus on this aspect, and soon we found ourselves breaking new ground There were a few others trying to apply the six sigma approach to design and development, but we soon found that they were missing a trick They had not thought of integrating more than one of the sophisticated tools at their fingertips together What we did was to link a way of gathering detailed insights into customer needs, to a tool that would optimize the products or services to meet these needs at the lowest practical cost, to one that ensured that this performance was maintained We applied the approach in the nuclear industry, in motor manufacturing, in an assessment of the potential for transforming the inland mail, and in three different ‘emergency response’ organizations It always needed adapting, and some relied more heavily on certain aspects than others, but fundamentally it worked Preface In 1993, I wrote a book about the approach, called On Route To Perfection I did not expect it to be an overnight best-seller In the intervening years, I have written five others, and they all sold well, being translated into a dozen or more languages and produced in a couple of editions, but ORTP continued to quietly sell for a decade or so I began to wonder why and did a little research Six sigma has continued to be a sound management approach In particular, it has been very popular with multinational companies, and especially with those whose manufacturing bases are in the Asian and Pacific rim areas My book, it seems, was doing very well in those countries particularly In the meantime I had gone through quite a transition myself I had invested a lot in my own development, especially in the whole area of human development, and was primarily working as a coach to senior managers Then, out of the blue, I was asked to work with a number of executives of a financial services company in Europe who were implementing a six sigma process My reservation with six sigma has always been around the plethora of ‘experts’ who were involved in some relatively restricted way in a project with one company, and who then try to apply the same ideas in a completely different organization I soon discovered that this was very much the case for the company by which I had been approached The simple tools and techniques were in place, but the executives had not bought in adequately to make it work With a revitalized interest in six sigma, and by now a lot more wisdom about the process of transformation in organizations, I thought it was time to revise the original approach, to bring it up to date, and to offer it in a way that may appeal to today’s management teams So here is a substantially rewritten account of the integration of quality function deployment, Taguchi’s methods of experimental design and statistical process control I have not tried to write three textbooks in one, and you will find some of the approaches a little quirky: the important thing is that they work One academic who reviewed my proposal felt that there needed to be more tools included and then suggested one or two; I am afraid he had missed the point: this is a book about six sigma and product (which includes service) development, not a comprehensive book of quality techniques, of which there are some excellent ones already I have deliberately not included the basics of problem solving, which viii Preface are essential in working towards six sigma, because I have already written a whole book on these (Wilson, 2000) Nor have I spent much time exploring the detail of the management of change because, again, I have written already on this (Wilson, 1995) I hope that you will add this to your repertoire of approaches, and that you will let me know of your successes: I love hearing from people and am happy to discuss any aspects of how you intend to apply, or are already applying, this approach to your work References Wilson, G (1995) Making Change Happen London: FT Pitman Wilson, G (2000) Problem Solving London: Kogan Page ix Six Sigma and the Product Development Cycle References Caulcutt, R (1983) Statistics for Analytical Chemists London: Chapman and Hall Grant, E and Leavenworth, R (1982) Statistical Quality Control Maidenhead: McGraw Hill Book Company Peters, T and Austin, N (1985) A Passion for Excellence Glasgow: William Collins 220 Appendix F-statistics (95% confidence) Degrees of freedom (error) (v2) Degrees of freedom (factor) (v1) 2 12 24 161.0 18.5 10.1 7.7 6.6 6.0 4.8 4.3 200.0 19.0 9.6 6.9 5.8 5.1 3.9 3.4 216.0 225.0 19.2 19.3 9.3 9.1 6.6 6.4 5.4 5.2 4.8 4.5 3.5 3.3 3.0 2.8 230.0 234.0 19.3 19.3 9.0 8.9 6.3 6.2 5.1 5.0 4.4 4.3 3.1 3.0 2.6 2.5 12 24 244.0 249.0 19.4 19.5 8.7 8.6 5.9 5.8 4.7 4.5 4.0 3.8 2.7 2.5 2.2 2.0 Appendix F-statistics (99% confidence) Degrees of Degrees of freedom (factor) (v1) freedom (error) (v2) 12 24 12 24 4052.0 5000.0 5403.0 5625.0 5764.0 5859.0 6106.0 6235.0 98.5 99.0 99.2 99.3 99.3 99.3 99.4 99.5 34.1 30.8 29.5 28.7 28.2 27.9 27.1 26.6 21.2 18.0 16.7 16.0 15.5 15.2 14.4 13.9 16.3 13.3 12.1 11.4 11.0 10.7 9.9 9.5 13.8 10.9 9.8 9.2 8.8 8.5 7.7 7.3 9.3 6.9 6.0 5.4 5.1 4.8 4.6 3.8 7.8 5.6 4.7 4.2 3.9 3.7 3.0 2.7 Appendix (base 10) Logarithms 10 20 30 40 50 60 70 80 90 100 0.00 0.30 0.48 0.61 0.70 0.78 0.85 0.91 0.96 1.00 0.04 0.30 0.48 0.61 0.70 0.78 0.85 0.91 0.96 1.00 0.08 0.30 0.48 0.61 0.70 0.78 0.85 0.91 0.96 1.00 0.11 0.30 0.48 0.61 0.70 0.78 0.85 0.91 0.96 1.00 0.15 0.30 0.48 0.61 0.70 0.78 0.85 0.91 0.96 1.00 0.18 0.30 0.48 0.61 0.70 0.78 0.85 0.91 0.96 1.00 0.20 0.31 0.48 0.61 0.70 0.78 0.85 0.91 0.96 1.00 0.23 0.31 0.48 0.61 0.70 0.78 0.85 0.91 0.96 1.00 0.26 0.31 0.48 0.61 0.70 0.78 0.85 0.91 0.96 1.00 0.28 0.31 0.48 0.61 0.70 0.78 0.85 0.91 0.96 1.00 NB If you remember looking at logarithm tables at school and think that these have a misprint, remember that you were used to using four-figure tables, whereas these are two-figure accuracy, which is perfectly good for our purposes Appendix Decibel values 0 10 20 30 40 50 60 70 80 90 0.00 Ϫ9.54 Ϫ6.02 Ϫ3.68 Ϫ1.76 0.00 1.76 3.68 6.02 9.50 Ϫ20.00 Ϫ9.08 Ϫ5.75 Ϫ3.48 Ϫ1.58 0.17 1.94 3.89 6.30 10.00 Ϫ16.90 Ϫ8.65 Ϫ5.50 Ϫ3.27 Ϫ1.40 0.35 2.13 4.10 6.58 10.60 Ϫ15.10 Ϫ8.26 Ϫ5.25 Ϫ3.08 Ϫ1.22 0.52 2.31 4.32 6.89 11.20 Ϫ13.80 Ϫ7.88 Ϫ5.01 Ϫ2.88 Ϫ1.05 0.70 2.50 4.45 7.20 11.90 10 20 30 40 50 60 70 80 90 Ϫ12.80 Ϫ7.53 Ϫ4.77 Ϫ2.69 Ϫ0.87 0.87 2.69 4.77 7.53 12.80 Ϫ11.90 Ϫ7.20 Ϫ4.54 Ϫ2.50 Ϫ0.70 1.05 2.88 5.01 7.88 13.80 Ϫ11.20 Ϫ6.89 Ϫ4.32 Ϫ2.31 0.52 1.22 3.08 5.25 8.26 15.10 Ϫ10.60 Ϫ6.58 Ϫ4.10 Ϫ2.13 Ϫ0.35 1.40 3.27 5.50 8.65 16.90 Ϫ10.00 Ϫ6.30 Ϫ3.89 Ϫ1.94 Ϫ0.17 1.58 3.48 5.75 9.08 20.00 Appendix Quality function deployment house of quality summary Quality Function Deployment Product/service: House of Quality Summary Date: ©1992, Prepared by: 2004 Graham Wilson Correlation matrix (Ϫ2, Ϫ1, 1, 2) Taguchi objective (ϩ / / Ϫ) Technical responses Customer complaints Customer Assessment Rank Customer expectations 10 11 12 13 14 15 16 17 Ϫ Ϫ 2 Target values Relationship ϭ Weak ϭ Medium ϭ Strong Service #s Service costs Tech importance Tech difficulty Tech benchmarks Ϫ Ϫ Identification: © 1992, 2004 Graham Wilson (f) Probability Plot Boundary (b) Tally f cum % Ϫ4s Ϫ2s Ϫ3s 0.5 0.13 10 30 50 70 20 60 90 80 3s 98 95 (a) Raw Data Upper Tolerance Lower Tolerance Tolerance Range Target Value Estimated Mean Estimated Capability Capability Index 99.997 99.5 99 4s 99.87 Capability 0.003 2s Mn Appendix report form Capability Report Form © 1992, 2004 Graham Wilson Date/Time No of defects Total in sample Proportion defective Description Sample size Sample freq P chart NP chart C chart U chart Appendix Attribute data control chart Attribute Data Control Chart Average Range Date/Time Individual Values Total Mean Range Description Sample size Sample freq Appendix Variables data control chart Variables Data Control Chart © 1992, 2004 Graham Wilson Index 3M, 28 ABB, Accountancy profession, 102 Accounts department, 93 Accumulation analysis, 152 Accuracy, 14 Advertising agency, 102 Agfa-Gaevert, 28 Aims, cascading, 38 Air Products, Airline baggage handling, 218 Airport terminals, 87 Allied Signal, Ambulance service, 101, 185, 187, 192 American Supplier Institute (ASI), 107 Analysis of variance (ANOVA), 108 Analytical tools, 45 Apple Macintosh, 67 Arithmetic mean, 19 Attribute variable, 17 Attributes charts, 208 Authenticity, Automotive industry, 80, 98, 185 Average, 19 Aviation fuel, 90 Baldrige National Quality Award (US), 8, 38 Banking, 52 Banking, investment, 98 Barts Spices, Bristol, 75 Basic skills, 42 BBC (British Broadcasting Corporation), 62, 79 Beaches, 126 Bell Laboratories, 206 Belzec concentration camp, Benchmarking, 37 Benchmarking, competitive, 100 Benchmarking, technical, 100 Black and Decker, 63 Black belt, 7, 36 Boeing, 102 Bombardier, Box, George, 149 Brainstorming, 63 Brewing industry, 103, 114, 192, 202 BS5750, BS7750, 82 BT (British Telecom), 88 Canon, 28 Capability, 26, 187 Car rental, 54, 218 Car tyres, 117 Carlzon, Jan, 58 Cartoon Corner, 66 Catering and hospitality, 108 Index Cause and effect charting, 63, 89 Cellular phone market, 27 Central limit theorem, 24 Central tendency, 20 Charismatic leader, 69 Checkout times, 218 Chemical factory, 108, 194 Cleaning company, 93 Cluster analysis, 90 Compaq, Competitors, 91, 100 Computer software company, 180 Confectionary, 50 Consistency, 14 Construction company, 181 Consultancies, 180 Continuous variable, 17 Control limits, 212 Corporate universities, 41 Correlation coefficients, 99 Counselling, 45 Courier, 14 Critical defective, 198 Critical success factors, 33 Culture of six sigma, Customer complaints, 92 Customer desensitization, 95 Customer relationship management, Customer satisfaction, 5, Customer service, 54, 74, 86, 180 Dale Carnegie, 3, 30 DEC, Defence procurement, Defensive reaction, 77 Degrees of freedom, 23 Deming Prize, 76 Deming, W Edwards, Design to targets, 82 230 Designed experiments, 108 Deviations, sum of, 21 DHL, 101 Diesel fuel, 97 Disney, 8, 66 Distribution market, 101 Divergent-convergent thinking, 44 Dow Chemical, Dupont, Early-life field reliability, 37 Electric light bulbs, 50 Electronic products, 80 Electronics assembly, 148 Emotional intelligence, Empowerment, 44 Error, 17 Evolutionary operations (EVOP), 149 Excel, Microsoft, 22, 23 Excellence, Experimental design, 60 Express delivery service, 101 External survey, 88 Facilitators, 36 Federal Express, 101 Financial services, 108 Fishbone diagram, 89 Ford, Freephone numbers, 87 Fuji, 28 Full factorial experiment, 111 Fully saturated partial factorial designs, 107 Furniture manufacture, 153 Galvin family, 11 Garbage in, garbage out, 81 Gaussian distribution, 24 Index GE, 6, GenCorp, Geometric mean, 20 Gestalt Centre, 36 Goals, clarifying, 32 Grieving process, 45 Group dynamics, 36 Harvard Business School, 37 Health service, 108 Henley – The Management College, 37 Holiday Inn, 13 Honeywell, Horizontal barchart, 18 Hospital switchboard, 218 Hotels, 86, 218 House of quality, 84 Household products, 135 How-how’ technique, 89 Hula-hula dancing, 56 Hutton Inquiry, 79 IBM, 6, 180, 201 Ilford, 28 Image capture, 48 Indian railways, 44 Individual development, 36 Individual’s chart, 181 Industrial espionage, 100 Information technology, 84 Infrared (IRDA), 172 Injection moulding, 98 Inner leadership, INSEAD, 37 Inspection, 81 Interactions between factors, 125 Interior noise, 97 Internal barriers, 74 Internal competition, 45 Interpersonal skills, 39 Interpersonal transactions, 36 Intuitive problem solving, 45 Ishikawa, Kaoru, 6, 89 ISO9000, 2, 74 Job sharing, 43 Joban Hawaiian Centre, Japan, 55, 77, 180 John Deere, Johnson & Johnson, Johnson Controls, Johnsonville Sausage, 10, 44 Juice extraction, 51 Kelly, Dr David, 79 Kobe Shipyard, Japan, 84 Kodak, 6, 28 Lager brewery, 86 Laing Homes, 206 Lakeside Thurrock, 199 Literacy skills, 42 Lo-Call numbers, 88 Lockheed Martin, Loss to society, 82 Lost opportunities, 73 Lucas, 61 Machine capability, 187 Mair, Eddie, 79 Management of change, 4, 36 Market research, 60 Market research, 89 Marketing, 108 Marketing, targeted, 46 Marriott, 13 Martial arts, 36 Maytag, Media relations, 180 231 Index Median, 20 Medical researcher, 215 Metaplan, 63 Microsoft Excel, 22 Mobile phones, 48 Mode, 19 Motorola, 6, 9, 10, 27, 199, 203 Motorola Executive Institute, 37 Motorola University, 41 Multi-tasking, 43 Multivariate analyses, 90 National Center on Education and the Economy, US, 42 Nationwide Anglia Building Society, 88 Navistar, Networking, 89 New product development, 47 Newspaper distribution, 101 NHS, 43 Nikon, 28 Nissan, 80 Nokia, 6,28 Non-accumulating percentage table, 159 Normal distribution, 19, 24 Numeracy skills, 42 Objectives, conflicting, 93 Oil-rig maintenance, 205 Olympus, 28 Organizational behaviour, Organizational development, 4, 30 Organizational learning curve, 83 Orthogonal arrays, 115 Outflow, 126 Owner managers, 70 PACCAR, Parameter design, 64 232 Partial factorial designs, 107 Participative management programme, 44 Partnership sourcing, 203 Pass/fail attribute, 18 Patient recovery path, 215 People content, 79 Personal digital assistant, 54 Personal organizer, 53 Personal stereo, 49 Peters, Tom, 3, 5, 203 Petrochemical industry, 87, 101 Pharmaceutical industry, 201, 210 Photocopier servicing, 72 Photographic film, 28 Phyletic gradualism, 48 Pilot plant, 108 Post Office (UK), 15, 186 Praxair, Precision, 14 Principal components analysis, 91 Printed circuit board manufacture, 100 Probability, 26 Process capability, 187, 190 Process competitors, 101 Process design, 51 Process optimization, 81 Process skills, 39 Product control, 184 Product design, 51 Product development cycle, 61 Professional services, 84 Psychology, Punctuated equilibria, 48 Quality circles, 43 Quality function deployment, 65 Quality management systems, 2, 5, 74, 185 Quality of work life movement, Index Radio paging, 55 Railway management, 108 Range, 19 Rational subgroups, 215 Re.Vision, 36 Red Army, Chinese, 43 Response, 117 Retirement home, 186 Review, ongoing, 46 Ringtones, 48 Roehampton Institute, 36 Rothamsted Agricultural Research Station, 112 Royal Mail, 59 Salt works, 196 SAS (Scandinavian Airline System), 58 Scalar axis, 18 Schein, Ed, Scientific management, Seagate, Second World War, 107 Self-assessment, 35 Self-directed teams, 43 Self-employed workers, 43 Self-managed teams, 43, 44 Shewhart, Walter, 6, 206 Siebe Foxboro, Siemens, Signal-to-noise ratio, 166 Six sigma, statistical definition, 25 Skewness, 19 Sony-Ericsson, 6, 28 Southwest Air, Spirituality in the workplace, Spreadsheet, 22 Standard deviation, 22 Starbucks, Starck, Philippe, 51 Statistical process control, 3, 60 Stayer, Ralph, 10 Steel structures, 50 Stem and leaf diagram, 18 Streaming video, 48 System design, 61 Taguchi objective, 96 Tally marks, 18 Task content, 79 Task forces, 44 Task process, 79 Tavistock Clinic, 36 Taxi, 202 Taylor, Frederick, Team-based working, 43 Teams, supporting, 43 Technical skills, 39 Technical specifications, 95 Television production company, 102 Textile manufacture, 184 TI, Times Higher Education Supplement, The, 77 Toasting bread, 51 Tolerance design, 67 Toshiba, Total quality management, 4, Toyota, 80, 83, 96 Transport Research Laboratory, 88 Travel agency, 16 Unimodal, 19 University of Surrey, 36 Variables, 16 Variance, 22 Veit, Ken, 66 Virgin, VW Motorworld, Kidlington, 76 233 Index Warner Brothers, 66 Welch, Jack, Whirlpool, Why-why’ technique, 89 Wire works, 103 Within experiments error, 136 234 Yo-yo syndrome, 74 Zander, Ed, 29 Zurich Financial Services, ... Six sigma In the same way that the points that represent four standard deviations on either side of the mean encompass 99.994% of the data records, six 25 Six Sigma and the Product Development Cycle. . .Six Sigma and the Product Development Cycle This page intentionally left blank Six Sigma and the Product Development Cycle Graham Wilson AMSTERDAM • BOSTON... 2.45 21 Six Sigma and the Product Development Cycle figure that they use Instead of just taking the sum of the deviations, they ‘standardize’ it This is done by taking each deviation from the average