Six Sigma Basic Key Terms - Part I (What is Six Sigma)

Six Sigma Basic Key Terms - Part I (What is Six Sigma)

Sigma – A term used in statistics to represent standard deviation, an indicator of the degree of variation in a set of measurements or a process.

Six Sigma – A statistical concept that measures a process in terms of defects – at the six sigma level, there are only 3.4 defects per million opportunities. Six Sigma is also a philosophy of managing that focuses on eliminating defects through practices that emphasize understanding, measuring and improving processes.

Defect – A measurable characteristics of the process or its output that is not within the acceptable customer limits, i.e., not conforming to specifications. Six Sigma is about practices that help you eliminate defects and always deliver products and services that meet customer specifications. The Sigma level of a process is calculated in terms of the number of defects in ratio to the number of opportunities for defects.

Variation – Any quantifiable difference between a specified measurement or standard and the deviation from such measurement or standard in the output of a process. Variation in outputs can result from many causes in the functioning and management of processes. An important goal of process improvement is to reduce variation in outputs.

Total Quality Management – A management approach that focuses on the organization as a system, with an emphasis on teams, processes, statistics, continuous improvement, and delivering products and services that meet and exceed customer expectations. Six Sigma is a disciplined extension of TQM.   

Vital Few Factors – Factors that directly explain the cause and effect relationship of the process output being measured in relation to the inputs that drive the process. Typically, data shows that there are six or fewer factors for any process that most affect the quality of outputs in any process, even if there are hundreds of steps in which a defect could occur – the vital few.

Process Capability – A statistical measure of inherent variation for a given event in a stable process. It’s usually defined as the process width divided by Six sigma and quantified using capability index. More generally, it’s the ability of the process to achieve certain results, based on performance testing. PC answers the question, what can your process delivers?

Culture – Refers to the beliefs, expectations, and ways of operating, and behaviours that characterize the interactions of people in any organization. It’s about “how things are done around here” in an organization. Culture evolves over a long period of time and it often reflects the beliefs and behaviours of top management. Because Six sigma affects the way things are done. Its successful implementation will require a change in culture that may be profound.

Champion – A senior – level manager who promotes the Six sigma methodology throughout the company and especially in specific functional groups. The champion understands the discipline and tools of Six Sigma, selects projects, establishes measurable objectives, serves as coach and mentor, remove barriers and dedicates resources in support of black belts. A champion ‘owns’ the process – monitoring projects and measuring the savings realized.

Black belt – A full time change agent trained in the methodology to solve product and process defects project by project with financially beneficial results. A black belt does Six sigma analysis and work with others to put improvements in place.

Breakthrough Goal – A dramatic, near immediate and significant improvement. In measurement terms, reaching a breakthrough goal represents an improvement of 60% to 80%.

Critical – to – quality (CTQ) – Elements of a process that significantly affect the output of that process. Identifying these elements is vital to figuring out how to make the improvements that can dramatically reduce costs and enhance quality.