DMADOV Archives - 6sigma https://6sigma.com/tag/dmadov/ Six Sigma Certification and Training Thu, 28 Dec 2023 10:02:17 +0000 en-US hourly 1 https://6sigma.com/wp-content/uploads/2021/03/cropped-favicon-blue-68x68.png DMADOV Archives - 6sigma https://6sigma.com/tag/dmadov/ 32 32 Industry: Procurement and Six Sigma https://6sigma.com/industry-procurement-and-six-sigma/ https://6sigma.com/industry-procurement-and-six-sigma/#respond Sun, 04 Jun 2017 22:52:38 +0000 https://6sigma.com/?p=21204 How can you not know about Six Sigma? These days, the smallest businesses and largest corporations are using Six Sigma to improve processes and maximize quality. It may have only been around for a few decades, but it has left its mark on the business world. In recent years, however, it has developed a more […]

The post Industry: Procurement and Six Sigma appeared first on 6sigma.

]]> How can you not know about Six Sigma? These days, the smallest businesses and largest corporations are using Six Sigma to improve processes and maximize quality. It may have only been around for a few decades, but it has left its mark on the business world. In recent years, however, it has developed a more widespread reputation. Six Sigma is an essential methodology to know for those working in manufacturing, as well as any number of other industries. Six Sigma is also a useful asset for procurement managers, enabling them to improve the quality and efficiency of their key suppliers. But how do procurement managers do this? And does is Six Sigma work in a purchasing and supply management environment? Today, we explore all these questions and more.

What is Six Sigma and How Does It Work?

Did you know that the term Six Sigma comes from the statistical measure for six standard deviations? Additionally, the Sigma portion of the term comes from the Greek letter sigma, which, in statistics, represents a single standard deviation. We all know how rigorous Six Sigma is as a process improvement discipline. It drives process improvements, increases customer satisfaction rates as well as profitability, and aims to achieve a gold standard of quality.

Six Sigma practitioners measure quality using a ratio of defects per million opportunities. Each level of quality has its own corresponding Sigma level, such as Four Sigma, Five Sigma, Six Sigma, and so on. For Six Sigma, the goal of all process improvement reduced variation, and project work is to minimize defects. The aim is for defects to occur only 3.4 times out of every million potential opportunities.

One of the most important and effective Six Sigma tools is DMAIC. This acronym stands for a series of process improvement actions that define a process, and measure its current performance. Additionally, DMAIC also analyzes the causes of defects, and solutions to improve it. Finally, it develops means of control with which to sustain improvements. The DMAIC stages, plus the additional tools mentioned, all help us understand how processes work. This enables us to evaluate the quantified effects of processes with statistical measurements called metrics.

Click here to know more about our training

How Does Six Sigma Relate to Purchasing and Procurement?

Six Sigma is highly relevant to procurement in the business world. Purchasers can apply Six Sigma ideas to their work in several different ways. Firstly, you may use a Six Sigma approach to working alongside a supplier. Doing so will allow you to make justified decisions by which to improve the quality of parts your supplier sends you.

Using a Six Sigma approach will reduce the number of invoice discrepancies with which you have to deal. You can also minimize variation and defect, and increase efficiency while ensuring greater customer satisfaction rates for future product batches. Your company will likely have a lot to deal with on a daily basis, which is why Six Sigma is a great tool for purchasers. You may even use Six Sigma to improve just about any purchasing process. Process inefficiencies should not be allowed to fester as they will only lose your organization revenue.

Purchasing Strategies Compatible with Six Sigma

Businesses often employ purchasing strategies to promote their procurement best practices. These best practices may include cost reductions, maximizing quality, and prompt delivery of quality products. Purchasers and managers working in the procurement sector utilize several different approaches to their work. Below are several such approaches used by procurement managers, all of which, one way or another, are compatible with Six Sigma ideas.

Total Quality Methods

Total Quality Methods (TQM) requires your suppliers to provide an ever-improving quality service. It’s also important that they avoid errors completely. You should encourage your supplier to maintain purchasing best practices. They can do so using various Six Sigma tools, such as DMAIC, DMADOV, and Root Cause Analysis. You should do the same. That way, your products will be free from defect, as the parts you receive will also be quality parts.

Remember, the more you practice you practice TQM, the greater your products or services will become. Similarly, by operating high-level Total Quality Methods in your supply chain, you can actively avoid defective parts or products. This will help you filter out the bad and receive only the good. Furthermore, by alerting your suppliers to these discrepancies as you find them, you can also ensure the same issues do not keep popping up.

Optimizing Your Suppliers

Six Sigma aim to improve efficiency through eliminating variation and maximizing quality. In the procurement sector, your company will select an optimum range of suppliers. These vendors will provide you with the best prices and terms. This benefits you as your company can then produce products at low cost and high quality. Just as in Six Sigma, you are taking an existing entity, and optimizing it through targeted improvements.

Like any process, this usually means that you should eliminate any insufficient or none-value-adding processes. In this case, suppliers who are less able than others tend to compromise the integrity of your business operations. As such, you should discard those vendors who cannot provide quality parts or services at optimum terms and prices. This is a common purchasing practice in the procurement sector, just as in Six Sigma, one removes process stages without value.

Supplier Development

Many companies tend to believe they maintain a symbiotic relationship with their suppliers. In these cases, both companies should benefit from the other, you and your suppliers working together to ensure each other’s success. As such, you may spend a great deal of time developing processes that assist your suppliers. In some cases, certain companies become dependent on single suppliers for specific products.

Certain suppliers may also become dependent on single companies to whom they deliver these products. If your supplier cannot operate according to required standards, you the procurement manager can support your vendors. You can do this by helping to improve the efficiency and quality of their services through Six Sigma-based process improvements. By supporting suppliers and implementing process changes to improve their procurement cycle, you will both benefit from the outcome.

Green Purchasing and Global Sourcing

This is a common and highly effective purchasing strategy that has risen to prominence in recent years. Governments and local councils often employ green purchasing to champion the importance of recycling. These days, purchasing products which have a negative impact on the environment is a poor business practice. Like all businesses, yours has a responsibility to purchase sustainable, environmentally-friendly products and parts. This means the sustained success of good, Green suppliers, ensuring they deliver quality products so that you can do the same. You can even use Green Six Sigma techniques to help you in your environmental endeavors.

Similarly, global sourcing is also important, as multinational corporations tend to view the world a single large market. These companies will source from multiple different vendors, regardless of their country of origin. Just the same as with any vendor, without quality control best practices in place, this strategy can lead to poor products.

Global Six Sigma offers both Live Virtual classes as well as Online Self-Paced training. Most option includes access to the same great Master Black Belt instructors that teach our World Class in-person sessions. Sign-up today!

Checkout Virtual Classroom Training Programs

Self-Paced Online Training Programs

The post Industry: Procurement and Six Sigma appeared first on 6sigma.

]]> https://6sigma.com/industry-procurement-and-six-sigma/feed/ 0 Glossary of Six Sigma Terms: Letters D – F https://6sigma.com/20987-2/ https://6sigma.com/20987-2/#respond Thu, 20 Apr 2017 22:18:12 +0000 https://6sigma.com/?p=20987 D

  • Six Sigma Decision Tree.

    Green and Black Six Sigma Belts use decision trees to help them decide on a course of action. Decision trees are graphical tools that explore potential options available to you. You should begin your tree with the decision you need to make, represented by a […]

    The post Glossary of Six Sigma Terms: Letters D – F appeared first on 6sigma.

    ]]> D

    • Six Sigma Decision Tree.

      Green and Black Six Sigma Belts use decision trees to help them decide on a course of action. Decision trees are graphical tools that explore potential options available to you. You should begin your tree with the decision you need to make, represented by a dot or circle. Then you should branch off with a line to represent potential future decisions, outcomes, or consequences. All these ideas should contribute to the final decision. Decision trees are primarily used in process improvement to find the most beneficial route.

     

    • Discriminant Analysis.

      A type of multivariate analysis used by Six Sigma Green Belts or Black Belts. Discriminant analysis should be used in process improvement. This helps you understand how continuous input variables differentiate between categorical outputs. In discriminant analysis, you have a single categorical output from a process, with a range of continuous inputs influencing it. By analyzing each factor, you can learn how it leads to your categorical output. You can also use discriminant analysis in situations where you must determine factors influencing a potential cause. For example, the factors that contribute to a customer defaulting on a loan. In this situation, there are two states, default or not default. The inputs affecting the outcome may consist of factors like age, financial stability, employment, etc.

    • DMADV. 

      Six Sigma Belts use DMADV in process improvement projects. DMADV uses a series of methodical actions commonly used in Design for Six Sigma, rather than the sequence used in DMAIC. DMADV stands for the following.

    • Define (the first stage, where we define project goals).
    • Measure (the second stage, here you measure the expectations of your stakeholders and customers, leveraging their demands. Techniques such as benchmarking and competitor analysis are useful here).
    • Analyze (the third stage involves recognizing and analyzing alternative solutions to process problems. Root cause analysis, decision trees, and discriminant analysis will be useful to you here).
    • Design (this stage requires you to create a detailed design of your solution, plotting it out meticulously).
    • Optimize (this is an additional stage, added to form DMADOV. Optimize involves experimental design and simulation to find ways to optimize your solution).
    • Verify (the final stage requires you to verify your design via pilot studies, as well as to evaluate it before and during activation).

    E

    • Efficiency of Estimators.

      Sometimes known as EOE, efficiency of estimators is a type of statistic in Six Sigma statistical analysis. EOE represents the properties of a population. You can have more than one estimator representing a specific property, depending on its suitability. Before selecting your preferred EOE, consider how alternative estimators may affect efficiency. They can also be biased, which is why the most efficient estimators typically give the lowest expected variance of error. This is also the lowest variance possible from an estimator divided by the probable variance of your specified estimator.

     

    • EVOP. 

      EVOP stands for the Evolutionary Operation of Processes. It is a type of experimental design technique used by practitioners of Six Sigma. Used by Black Belts, EVOP requires small changes you to make small changes to a process when in normal operation. With each additional change, you come closer to finding the optimum operation conditions for that process. Changes may include removal of a none-value-adding step or increase in velocity. EVOP allows you to find the optimum solution to any problem progressively. However, it can take considerable patience and restraint, as EVOP typically works over an extended period. This is beneficial as it minimizes any disruptions to the normal process operation while moving towards an improved state.

     

    • Experimental Design.

      Also known as Design of Experiments, Experimental Design is a Six Sigma tool used by Green and Black Belts in process improvement. You can use Experimental Design when dealing with multiple affecting factors, testing each factor simultaneously, to provide greater results than the One Factor at a Time method. Experimental Design varies factors systematically, analyzing the resulting responses to find a relevant regression equation. Experimental Design involves two approaches, the classical method, and the Taguchi method. The Taguchi method focuses on designing experiments to deal with variation. The most commonly-used design types are factorial designs and fractional factorial designs, as well as Plackett-Burman designs. Experimental Design also appears in the Optimize stage of DMADOV.

     

    F

    • Factor Analysis.

      Factor analysis is another type of multivariate analysis, involving numerous continuous factors combined to create a smaller amount. The smaller number usually sheds light on where quality or process variation has come from and why. Six Sigma Belts know factors that influence variation as eigenvectors. If you had conducted a questionnaire on customer reactions to a new food gadget, you could use the questions to form eigenvectors. If there were a hundred questions, three eigenvectors would be sufficient, e.g. usefulness, safety, and practicality, to explain variation between respondents. Much like root cause analysis, fault tree analysis, and discriminant analysis, factor analysis is reserved for Green and Black Belt use.

     

    • Fault Tree Analysis.

      Six Sigma Green Belts may use fault tree analysis in process improvement projects. When analyzing the issue at hand, for example, slow production speed or insufficient product quality, fault tree analysis can identify root causes, much like RCA. Fault tree analysis (FTA) uses a tree-like structure, starting with the problem, branching downward to describe a potential cause and the root causes below that. Fault tree analysis enables you to specify the fine details of a process and the faults affecting it.

     

    • FMEA. 

      FMEA, also known as failure mode & effects analysis, helps Six Sigma practitioners to evaluate risk on their projects. In FMEA, you should evaluate every potential failure mode for the following. S – severity of consequences, provided failure occurs. O – probability of a failure occurring. D – the probability of detecting failure, e.g. variation or defect, before the product is shipped. You should rate each category from 1 to 10, with each value multiplied to identify its risk priority number (RPN). Once you have the RPN, you can calculate if it is above your threshold. If it does succeed the threshold, you can then reduce it. FMEA appears in the Control state of DMAIC and DMADV for Six Sigma projects.

    The post Glossary of Six Sigma Terms: Letters D – F appeared first on 6sigma.

    ]]>     https://6sigma.com/20987-2/feed/ 0