Process Capability

Six Sigma
 Assignment # 3
How the Quality Product and service is aligned with the positioning statement of the
product and service? Draw and decompose the quality parameters from the Positioning
statement of one Organisation. The report should consists of
•About the Organisations:
•Various Products
•Quality of its products Vis-a Vis its competitors
•Positioning Statement of One product
•Decomposition of the Positioning statements to Quality parameters
•How consumers feels about the quality of service or product Vs. Quality commitment
set by the Organisation. through positioning statement.
•Your Opinion: Whether the company justifies its positioning statement with product or
service it provides. Your suggestion to the company. What you could have done …
Nature of the Assignment: Individual
Submission Through: Turn It In

Quality Management 2
 WHICH PERFORMANCE YOU WANT…

I II III

IV
The best performance:

The worst performance:

As you can see, even the best performance has
variation, although small.

VARIATION

Is inevitable in Real life

 Characterization

1 1
68.27%
2 2
95.45%
3 3
99.73%
Do you mean to say, whether you like it or not, 99.73%
of the observations will lie within Average +/- 3 s.d.?
 Characterization of the pattern
Variability is estimated through standard deviation.

Variation /
Standard deviation Mean or Average

Center / Location

How do you calculate standard deviation?

 PROCESS CAPABILITY
• Historically, the use of the capability indices was first explored within the Ford Motor
Company (1984)
• The first process capability index appeared in the literature as “The precision index
Cp” defined by Kane (1986)
• Finley (1992) refers to this index as CPI (Capability Potential Index)
• Montgomery (1996) uses the term PCR (Process Capability Ratio)

Process capability refers to the natural variation of a process relative to the variation
allowed by the design specifications. It is defined as the ratio of the range of the
design specifications (the tolerance range) to the range of the process variation, which
for most firms is typically 6sigma.
Cp = Tolerance Range/ Process Range
Tolerances are design specifications reflecting customer requirements for a product.
They specify a range of values above and below a designed target value (also referred
to as the nominal value), within which product units must fall to be acceptable.
 PROCESS CAPABILITY

Process Capability
= USL-LSL/6

Mean = 85.8

Standard Deviation = 6.8

65.4 106.2
PROCESS CAPABILITY
 PROCESS CAPABILITY

LSL USL
VARIATION
ACTUAL
PERFORMANCE
Vs.
SPECIFICATIONS
Or
Customer Requirements
 PROCESS CAPABILITY

A second measure of process capability is the process

capability index (Cpk). The Cpk differs from the Cp in
that it indicates if the process mean has shifted away
from the design target, and in which direction it has
shifted—that is, if it is off center.
 Exercise on Cp/Cpk
The Patanjali Food Company packages potato chips in bags. The
net weight of the chips in each bag is designed to be 9.0 oz, with
a tolerance of +/- 0.5 oz.
The packaging process results in bags with an average net weight
of 8.80 oz and a standard deviation of 0.12 oz. The company
wants to determine if the process is capable of meeting design
specifications.
 Interpretation of Cpk
Cpk < 1.00 Inadequate it indicates that the process is not adequate with
respect to the production tolerances
(specifications), and either process variation
needs to be reduced or process mean

1.00 < Cpk < 1.33 Capable some caution needs to be

taken regarding to the process distribution, and
certain process
control is required.

1.33 < Cpk < 1.50 Satisfactory it indicates that process quality is adequate,
material substitution may be allowed, and no
stringent quality
control is needed.

1.50 < Cpk < 2.00 Excellent it indicates that process quality exceeds
"Satisfactory"
 Actual vs Specified Comparison

Scenario: Specified tolerance

(T) exactly equals to the
process capability, i.e. 6

4 ft. wide vehicle running with

a 4 ft. wide road
6

Tolerance(T) 2700 ppm

LSL USL

Are you comfortable with the status quo? You want to reduce
the variability from  to  1?
 Reduce the variation by improving the process:

Now, the situation is bit

comfortable. 3 ft. wide
vehicle running on 4 ft. wide
road.

Have 1 sigma gap from the

boundaries of the road
1 1 1 1
T=8  1
6 1
Tolerance(T)
LSL USL 64 ppm

Are you comfortable with the status quo? You still want to
further reduce the variability from  1 to  2?
 Reduce the variation by improving the process:

2 ft. wide vehicle

running on 4 ft. wide
road
Have 2 sigma gap from
the boundaries of the
road.
2 2 2 2 T=10  2
6 2
Tolerance(T)
LSL USL 0.6 ppm
Looking for reducing variability further  2 to  3 ?
 Six Sigma without Shift:

Oh, Yes!
You have got it!!!

3 3 3 3 T=12  3

6 3 0.002 ppm
Tolerance(T) or 2 ppb
LSL USL
Wait a bit! Every time you are assuming that average has always
been maintain at target. Is it practical? What happens if the
average shifts to a distance of 1.5  3 from the target to the worse
 Process Shift
The reason for this discrepancy was determined by Motorola in
their early days in developing Six Sigma. Motorola determined ,
through their own experience that process drifts overtime and
they referred to this phenomenon as “Long Term Dynamic Mean
Variation”. This variation generally falls between 1.4 to 1.6
sigma.
 Six Sigma with Shift (Short-term):
Let us assume, average can go as away as 1.5 times s.d.
from the target.

T=12  3

(with 1.5  3 shift)

3.4 ppm
4.5  3 1.5  3 1.5  3
Today we thought that
the sigma level to be of
6 3 Six, in the long run it
Tolerance(T)
LSL USL becomes 4.5 .
 Six Sigma as a Goal

Sigma Rating PPM

2 308,537
3 66,807
4 6,210
5 233
6 3.4
Process Defects per
Capability Million Opportunities

The Sigma scale of measure is perfectly correlated to such

characteristics as defects-per-unit, parts-per-million
defective, and the probability of a failure/error.
Understanding the Impact of Six Sigma Quality

ERROR 3 Sigma Process 6 Sigma Process

Wrong drug prescription 5400 every year. 1 in every 25 years
Unsafe drinking water 2 hours each month 1 second every 16 years.

No TV transmission 27 minutes each 6 seconds in year

week
Short or long landing at an 5 per day 1 in 10 years
average airport
Incorrect surgical 1350 per week 1 in 20 years
operations.
Articles of mail lost 54000 per hour 35 per year
 SIX SIGMA MEASURE

Unit = The item produced or processed

Defect = Any event that does not meet a customer specification
DPU = Defects per Unit is the average number of defects observed
when sampling a population ( Total No. of Defects / Total population)
DPO = Defects per Opportunity (Defects per Opportunity is the
probability of units produced with zero defects by the process.
DPMO : Defects per Million Opportunities. DPMO is considered
long-term measurement of a process and this can be directly
converted
D: No. of defects /O: No. of opportunities for a defect /
U: No. of units /
TOP: Total number of opportunities = U * O, /
DPO= D/TOP
Example of a Nail
 The Process Sigma Scale
Process
DPMO Sigma
308,537 2
66,807 3
Increase in Process
6,210 4
Sigma requires 233 5
exponential defect
reduction 3.4 6
Defects per Process
Million Capability
Opportunities

(distribution shifted ±1.5 s)

 Yield
– Process sigma can be Process
calculated on either the Step 1

number of items that make

it through defect-free the
“first time through” or on No
the final number of items Correct? Errors
reworked
that are defect-free once
errors are corrected
Yes

– In most situations, it
makes sense to base sigma
calculations on First Pass
Yield First Pass Yield = Final Yield =
Number of items Number of items that
that make it through are defect free
error-free (no AFTER errors are
corrections) corrected
 SIX SIGMA MEASURE

THROUGHPUT YIELD: Probability of producing a defect free

component. Throughput Yield measures the ability of the process to
produce defect-free units

ROLLED THROUGHPUT YIELD: Is a multiplication of throughput

yields of each process step that a product goes through. If we calculate the
Throughput Yield for n process steps as Yt1, Yt2, Yt3,…..Ytn, then:
RTY = Yt1 * Yt2 * Yt3…Ytn
 Rolled Throughput Yield (RTY)
Example:
There are six possible Critical to Quality steps required to
process a customer order, with the Throughput Yields of 99.7%,
99.5%, 95%, 89%, 92.3%, 94%. The Rolled Throughput Yield is
calculated as:
•RTY = 0.997 * 0.995 * 0.95 * 0.89 * 0.923 * 0.94 = 0.728

It is interesting to see how bad the Throughput Yield will be,

even though none of the CTQ steps are that bad. It all adds up!
You can see that as processes become more complex (i.e. more
CTQ steps), the defect rates can climb rather quickly.
How to Calculate Process Sigma
1) Compute actual First Pass Yield
Yield = (
1–
defects
)
total opportunities
x 100

(total opportunities = number of units x opportunities per unit)

2) Look up Yield in Process Sigma Table

EXAMPLE: 100 units

5 opportunities
7 defects

7
Yield = 1 –( 5 x 100 ) x 100

= (1 – .014) x 100 = 98.6% = 3.7 s

 Calculating Process Sigma
1. Determine number of defect opportunities O=
5
______
per unit

2. Determine number of units processed N= 100

______

3. Determine total number of defects D= 7

______
made (include defects made and later fixed)
D .014
4. Calculate Defects Per Opportunity DPO= = ______
NxO

5. Calculate Yield Yield = (1-DPO) x 100 = 98.6

______

6. Look up Process sigma in the Process Sigma Table

Process Sigma =
3.7
______
 Exercise
An insurance company has collected data of
particular category of insurance proposals. In the last
3 months , 101 errors were noticed in 600 of these
proposals. A proposal can have three types of errors .
What is the probability of an error free proposal.
What is the sigma level of the process.