Six Sigma is a widely adopted approach for improving the quality and efficiency of business processes. It is based on statistical analysis and aims to reduce defects, improve customer satisfaction, and increase profitability. One of the key concepts of Six Sigma is sigma, which is a measure of process variability.
In this blog post, we will explore what sigma is and why it is important in Six Sigma?
What is Sigma in Six Sigma?
Sigma is a Greek letter that is used to represent standard deviation, which is a statistical measure of the amount of variation in a set of data. It is a measure of how much the data varies from the average value. In Six Sigma, sigma is used to quantify the level of defects in a process. A process with a low sigma level has a high defect rate, while a process with a high sigma level has a low defect rate.
The goal of Six Sigma is to reduce process variability and
increase the sigma level of a process. A process with a sigma level of 6 (hence
the name Six Sigma) has a very low defect rate of 3.4 defects per million
opportunities. This level of performance is considered to be world-class and is
achieved by very few organizations.
Why is Sigma important in Six Sigma?
Sigma is important in Six Sigma because it provides a
standardized metric for measuring process performance. It allows organizations
to compare the performance of different processes and identify areas for
improvement. By increasing the sigma level of a process, organizations can
reduce defects, improve customer satisfaction, and increase profitability.
Sigma is also important in Six Sigma because it is used to
set goals and measure progress. For example, if a process has a sigma level of
3, the goal might be to increase it to 4 or 5. By tracking the sigma level over
time, organizations can determine whether their improvement efforts are
effective.
How is Sigma calculated in Six Sigma?
Sigma is calculated in Six Sigma using a statistical formula
called the sigma level calculation. This formula takes into account the number
of defects, the number of opportunities for defects, and the process
performance. The formula is as follows:
Sigma level = (1 - (defects per million opportunities /
total opportunities))^0.5 x Z
Where:
- Defects per million opportunities (DPMO) is the number of defects per million opportunities for a process.
- Total opportunities are the total number of opportunities for defects in a process.
- Z is the number of standard deviations from the mean. For a one-sided process, Z is 1.5; for a two-sided process, Z is 1.65.
For example, if a process has 10,000 opportunities and 100
defects, the DPMO would be 10,000 / 100 = 1,000. If the process is one-sided,
the Z value would be 1.5. Using the formula, the sigma level would be:
Sigma level = (1 - (1,000 / 10,000,000))^0.5 x 1.5 = 4.2
Conclusion
Sigma is a key concept in Six Sigma and is used to measure the level of defects in a process. By increasing the sigma level of a process, organizations can reduce defects, improve customer satisfaction, and increase profitability. The sigma level calculation is used to set goals and measure progress in Six Sigma projects. Understanding sigma and its role in Six Sigma is essential for anyone involved in process improvement.
