Before starting six sigma journey, you should take the time to review terms of six sigma for the better understanding of its tools and techniques.
Accountability
Conditional personal or professional liability “after” the fact, determined by action or responsibility. Accountability to action assumes the willingness to be held accountable for sufficient expertise and capability. (see responsibility)
Accuracy
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Accuracy refers to a clustering of data about an obvious target. It is the difference between a physical quantity’s average measurements and that of a known standard, accepted ‘truth,’ vs. ‘benchmark.’ Envision a target with many arrows circling the bullseye. However, none of them are near each other.
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Precision refers to the tightness of the cluster of data. Envision a target with a cluster of arrows all touching one another but located slightly up and to the right of the bullseye.
Active Data
Actively and Purposefully make changes in our data to monitor the corresponding impact and results on the Xs and Ys
Agile
Methods for delivering projects with evolving requirements, through collaborative approaches by self-organising, multi-functional teams.
Originally implemented for software development with a focus on delivering iterative releases of functional software. Now used for any form of value delivery where changing requirements are common and must be accommodated.
Affinity Diagram
A tool used to organize and present large amounts of data (ideas, issues, solutions, problems) into logical categories based on user perceived relationships and conceptual frame working.
ANOVA
Analysis Of Variance (ANOVA), a calculation procedure to allocate the amount of variation in a process and determine if it is significant or is caused by random noise. A balanced ANOVA has equal numbers of measurements in each group/column. A stacked ANOVA: each factor has data in one column only, and so does the response.
Balanced Scorecard
The balanced scorecard is a strategic management system used to drive performance and accountability throughout the organization.
The scorecard balances traditional performance measures with more forward-looking indicators in four key dimensions:
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Financial
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Integration/Operational Excellence
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Employees
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Customers
Benchmarking
The concept of discovering what is the best performance being achieved, whether in your company, by a competitor, or by an entirely different industry.
Benchmarking is an improvement tool whereby a company measures its performance or process against other companies’ best practices, determines how those companies achieved their performance levels and use the information to improve its performance.
Benchmarking is a continuous process whereby an enterprise measures and compares all its functions, systems and practices against strong competitors, identifying quality gaps in the organization, and striving to achieve competitive advantage locally and globally.
Binomial Distribution
In a situation where there are exactly two mutually exclusive outcomes (Ex: Success or Failure) of a trial, to find the x success in N trials with p as the probability of success on a single trial.
Ex: Team A has won 15 Cricket Matches out of 50 played. What is the probability of winning almost 5 matches in the next 10 matches?
x = 5, N = 10 and p = 15/50 = 0.3
Mean = N * p = 10 * 0.3 = 3
Brainstorming
A method to generate ideas. Ground rules such as -no idea is a bad idea- are typical. The benefit of brainstorming is the power of the group in building ideas off each other's ideas.
A problem-solving approach/technique whereby working members in a group are conducting a deductive methodology for identifying possible causes of any problem, to surmount poor performance in any process or activity pursued by the group members and facilitator.
Breakthrough Improvement
Breakthrough improvement involves major improvements in key business areas. They are often chronic problems solved permanently through focused, dedicated resources working for a limited period.
Due to the investments in time and attention required, breakthrough improvement projects are selected by a management group that typically acts as a steering group. The improvement goal is between 50 and 95 percent improvement in four to 12 months, depending on project scope. Usually, the scope of inquiry crosses multiple functional boundaries.
Business Metric
A high-level existing management performance indicator that champions care a lot about. Example: Profitability percentage, Customer Satisfaction, Inventory levels, Time to market, Yield, etc. Business metrics are influenced by Multiple processes or many many outputs.
Business Process Quality Management also called Process Management or Reengineering. The concept of defining macro and micro processes, assigning ownership, and creating responsibilities of the owners.
Business Risk Management (BRM)
Used to evaluate the business risk involved for any change in the process.
Calibration
Calibration is simply the comparison of instrument performance to a standard of known accuracy. It may simply involve this determination of a deviation from nominal or include correction (adjustment) to minimize the errors. The properly calibrated equipment provides confidence that your products/services meet their specifications. Calibration:
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increases production yields,
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optimizes resources,
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assures consistency and
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ensures measurements (and perhaps products) are compatible with those made elsewhere
Capability
The capability of a product, process, practicing person or organization is the ability to perform its specified purpose based on tested, qualified or historical performance, to achieve measurable results that satisfy established requirements or specifications.
Capacity
The maximum amount of parts that may be processed in a given period. Is constrained by the bottleneck of the line–that is, the capacity of a production system depends on what is usually the slowest operation.
Capacity = 1 / Cycle Time
Typically the above formula is used when cycle time is expressed in shifts/part, thus measuring capacity as parts/shift.
Cause and Effect Diagram
A cause and effect diagram is a visual tool used to logically organize possible causes for a specific problem or effect by graphically displaying them in increasing detail. It helps to identify root causes and ensures the common understanding of the causes. It is also called an Ishikawa diagram.
Central Tendency
The numerical average (e.g. mean, median or mode) of a process distribution. Can also be displayed as the centerline of a process control chart.
Change Management
Change management is an approach for effectively implementing change in an organization, and ensuring that the benefits of change last.
The term refers to the broader impacts of change – less about the mechanical implementation of the change and more about the effect of change on people and how they, as individuals and teams, the transition from the current state to the desired future state.
Chi-Square Test
The Chi-Square Test is a statistical test which consists of three different types of analysis 1) Goodness of fit, 2) Test for Homogeneity, 3) Test of Independence.
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The Test for Goodness of fit determines if the sample under analysis was drawn from a population that follows some specified distribution.
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The Test for Homogeneity answers the proposition that several populations are homogeneous on some characteristic.
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The Test for independence (one of the most frequent uses of Chi Square) is for testing the null hypothesis that two criteria of classification, when applied to a population of subjects are independent. If they are not independent, then there is an association between them.
Continuous Data
Continuous data is information that can be measured on a continuum or scale. Continuous data can have almost any numeric value and can be meaningfully subdivided into finer and finer increments, depending upon the precision of the measurement system.
As opposed to discrete data like right or bad, off or on, etc., continuous data can be recorded at many different points (length, size, width, time, temperature, cost, etc.).
Continuous Improvement (CI)
Continuous Improvement (CI): Adopting new activities and eliminating those which are found to add little or no value. The goal is to increase effectiveness by reducing inefficiencies, frustrations, and waste (rework, time, effort, material, etc.). The Japanese term is Kaizen, which is taken from the words “Kai” means change and “zen” means good.
COPQ
COPQ stands for Cost of Poor Quality. See Cost of Poor Quality for definition.
Cost Of Quality
The cost associated with the quality of a work product. As defined by Crosby (“Quality Is Free”), Cost Of Quality (COQ) has two main components: *Cost Of Conformance* and *Cost Of Non-Conformance.
The cost of quality is the amount of money a business loses because its product or service was not done right in the first place. From fixing a warped piece on the assembly line to having to deal with a lawsuit because of a malfunctioning machine or a badly performed service, businesses lose money every day due to poor quality. For most businesses, this can run from 15 to 30 percent of their total costs.
Cpk
Process Capability Index (‘equivalent’) taking account of off-centredness: effectively the Cp for a centered process producing a similar level of defects – the ratio between permissible deviation, measured from the mean value to the nearest specific limit of acceptability, and the actual one-sided 3 x Sigma spread of the process. As a formula, Cpk = either (USL-Mean)/(3 x Sigma) or (Mean-LSL)/(3 x Sigma) whichever is the smaller (i.e. depending on whether the shift is up or down). Note this ignores the vanishingly small probability of defects at the opposite end of the tolerance range. Cpk of at least 1.33 is desired.
Critical to Customer - CTC
This is the input to the Quality Function Deployment activity, for the customer requirements side of the analysis. Not same as CTQ.
CTQ’s are the internal critical quality parameters that RELATE to these customer-critical parameters. QFD relates the two and leads to the DFMEA efforts which quantify the severity and frequency of occurrence of failure to meet the CTQ’s and thus the CTC’s by relationship. Car door sound when closing might be a CTC, while the dimensional tolerances and cushioning that produce those conditions are CTQ’s for the automaker.
Critical To Quality - CTQ
CTQs are the internal critical quality parameters that relate to the wants and needs of the customer. They are not the same as CTCs (Critical to Customer), and the two are often confused.
CTCs are what is important to the customer; CTQs are what’s important to the quality of the process or service to ensure the things that are important to the customer.
Customer Focus
The concept that the customer is the only person qualified to specify what Quality means. This leads to detailed analyses of who are the customers, what are their needs, what features (or new) are required of our products/services, how do customers rate our products/services versus our competitors and why, how can we keep our customers satisfied?