Six Sigma Definitions
Acceptable Quality Level (AQL)
AQL is limit of a satisfactory process average at a particular quality level when a continuing series of lots is considered.
Activity-based costing (ABC)
A system for making business decisions based on cost information of fundamental business activities as tasks related to product design, development, quality, manufacturing, distribution, customer acquisition, service and support. ABC is sometimes considered a form of business process re-engineering as it insists on surfacing a manageable number of cost drivers that can be used to trace variable business costs to customer, products and processes.
Analysis of Means (ANOM)
A statistical procedure for troubleshooting industrial processes and analyzing the results of experimental designs with factors at fixed levels. It provides a graphical display of data. Article: Keep on Budget With Earned Value Analysis
Analysis of Variance (ANOVA)
A basic statistical technique for analyzing experimental data. It subdivides the total variation of a data set into meaningful component parts associated with specific sources of variation in order to test a hypothesis on the parameters of the model or to estimate variance components.
A graphic description of the sequential steps that must be completed before a project can be completed.
A framework, which translates a company's vision and strategy into a coherent set of performance measures. A balanced business scorecard helps businesses evaluate how well they meet their strategic objectives. It typically has four to six components, each with a series of sub-measures. Each component highlights one aspect of the business.
A standards for comparisons, a reference for measuring progress in improving a process, usually to differentiate between a current state and a future state. Article: Microsoft Project 2007: Saving and Updating a Project Interim Plan
A method for comparing a process, using standard or best practices as a basis, and then indentifying ways to improve the process.
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 analyses and works with others to put improvements in place. Article: What is the Purpose of Six Sigma?
A dramatic, near-immediate and significant improvement.
A collection of activities that work together to produce a defined set of products and services. All business processes in an enterprise exist to fulfill the mission of the enterprise. Business processes must be related in some way to mission objectives.
Business Process Improvement (BPI)
The betterment of an organization's business practices through the analysis of activities to reduce or eliminate non-value added activities or costs, while at the same time maintaining or improving quality, productivity, timeliness, or other strategic or business purposes as evidenced by measures of performance. Also called functional process improvement.
Business Process Redesign or Reengineering
A management method which stresses the fundamental rethinking of processes, questioning all assumptions, in an effort to streamline organizations, and to focus on adding value in core processes.
A senior-level manager who promotes the Six Sigma methodology throughout the company and especially in specific functional groups. A champion “owns" the process – monitoring projects and measuring the savings realized. Article: Key Concepts of Six Sigma
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.
Critical Control Point (CA)
A function or an area in a manufacturing process or procedure, the failure of which, or loss of control over, may have an adverse affect on the quality of the finished product and may result in a unacceptable health risk.
The time it takes to complete a process from beginning to end, consisting of work time and wait time.
Are control charts which display the number of defects per sample.
Common Cause Variation
A variation that affects all the individual values of a process Common causes Inherent causes of variation in a process. They are typical of the process, not unexpected. That is not to say that they must be tolerated; on the contrary, once special causes of variation are largely removed, a focus on removing common causes of variation can pay big dividends.
A line chart with control limits. It is constructed by mathematically constructing control limits at 3 standard deviations above and below the average, one can determine what variation is due to normal ongoing causes (common causes) and what variation is produced by unique events (special causes).
One of two values (lower and upper) that indicate the inherent limits of a process.
Cost of Poor Quality
Total labor, materials, and overhead costs attributed to imperfections in the processes that deliver products or services that don’t meet specifications or expectation.
Six Sigma Terms and Definitions (Continued)
Factual information used as a basis for reasoning, discussion, or calculation; often refers to quantitative information.
A measureable characteristic of the process or output that is not within the acceptable customer limits, i.e., not conforming to specifications. Six Sigma practices help you eliminate defects and always deliver products and services that meet customer specifications. Article: Adding Six Sigma Tolerances to Your Organization
Design for Six Sigma (DFSS)
A systematic methodology using tools, training, and measurements to enable the design of products, services, and processes that meet customer expectations at Six Sigma quality levels.
An acronym that represents the five phases in the Six Sigma Methodology: Define, Measure, Analyze, Improve, and Control. It is the Six-Sigma problem-solving approach that serves as a roadmap to be used on all projects and process improvements, with the Six Sigma tools applied as needed. Article: Top Six Questions About Six Sigma
Failure Mode Effect Analysis (FMEA)
The manner in which a part or process can fail to meet specification, creating a defect or non-conformance, and the impact on the customer if that failure mode is not prevented or corrected.
Also called a cause and effect diagram, it is used to provide a pictorial display of a list in which you identify and organize possible causes of problems, or factors needed to ensure success of some effort. It is an effective tool that allows people to easily see the relationship between factors to study processes, situations, and for planning. Fishbone diagrams are typically constructed through brainstorming techniques. As a result, they are often drafted by hand on paper. However, two software packages capable of displaying the diagram professionally are AutoCad and CADKEY. Learn how to create your own fishbone diagram in this article.
A graphical representation in which symbols are used to represent such things as operations, data, flow direction, and equipment, for the definition, analysis, or solution of a problem.
Is a bar chart that shows planned work and finished work in relation to time. Each task in a list has a bar corresponding to it. The length of the bar is used to indicate the expected or actual duration of the task. Learn how to create a Gantt chart in Excel here.
A technique used to compare a current state and a target future state.
Gauge Repeatability and Reproducibility Study
A study to ensure that your measurement systems are statistically sound.
A team leader who supports the implementation and application of Six Sigma tools by way of participation on project teams who also have other organizational responsibilities besides being a team leader. Article: Key Concepts of Six Sigma
A method of strategic planning for quality. It helps executives integrate quality improvement into the organization's long-range plan. It is used to ensure that the mission, vision, goals, and annual objectives of an organization are communicated to and implemented by everyone, from the executive level to the front-line level.
A group of vertical bar graphs that shows the distribution in a group of data. The histogram usually represents all of a set of data points on a two-axis graph to show the distribution of all those data points and to reveal patterns. Article: Project 2007: How to Display the Resource Histogram (part 1)
Is a problem-solving tool that uses a graphic description of the various process elements to analyze potential sources of variation, or problems. (Same as Cause and Effect Diagram or Fishbone Diagram).
The family of quality management and quality assurance standards adopted by ISO (International Organization for Standardization, founded 1947), an international consensus of over 110 countries.
Lower Control Limit
A horizontal dotted line plotted on a control chart, which represents the lower process limit capabilities of a process.
Master Black Belt
The equivalent to an internal consultant. They are not full-time members of the team but assist the team with the more technical aspects of their work on an as needed basis. Article: Key Concepts of Six Sigma
The sum of a series of values divided by the number of values – average.
The midpoint in a series of values.
A Value that occurs most often in a series of values.
A representation of the relative importance of process causes or defects, based on the rule of thumb that 80% of all problems result from 20% of the causes. Reference: How to Create a Pareto Chart in Excel.
Parts Per Million (PPM)
PPM is a way of stating the performance of a process in terms of actual or projected defective material. PPM data can be used to indicate areas variation requiring attention.
Any repetitive action – be it a transactional, manufacturing, or services environment. The Six Sigma methodology collects data in variations in outputs associated with each process, so it can be improves and those variations reduced.
The ability of the process to achieve certain results, based in performance testing.
More Six Sigma Terms and Phrases
Process Decision Program Chart (PDPC)
A method helps determine which processes to use to obtain desired results by evaluating the progress of events and the variety of conceivable outcomes. Implementation plans do not always progress as anticipated. When problems, technical or otherwise, arise, solutions are frequently not apparent. The PDPC method, in response to these kinds of problems, anticipates possible outcomes and prepares countermeasures that will lead to the best possible solutions.
The spread of values +/-3 sigma from the mean – process width; also known as normal variation.
An illustrated description of how a process works.
Defined as conformance to Specifications. Any product or service that meets its specifications is a quality product or service.
All the planned and systematic activities implemented within the quality systems to provide adequate confidence the requirements for quality will be met. (1) A planned and systematic pattern of all actions necessary to provide adequate confidence that an item or product conforms to established technical requirements. (2) A set of activities designed to evaluate the process by which products are developed or manufactured.
Quality Function Deployments (QFD)
QF is a method used to identify critical customer attributes and to create a specific link between customer attributes and design parameters. Matrices are used to organize information to help marketers and design engineers answer three primary questions:
- What attributes are critical to our customers?
- What design parameters are important in driving those customer attributes?
- What should the design parameter targets be for the new design?
The organizing framework for the QFD process is a planning tool called the "house of quality." Information Technology (IT) and Construction companies are only now beginning to adapt and use QFD techniques as a strategic quality management tool.
The difference between the highest value and the lowest value in a series, the spread between the maximum and the minimum.
Root Cause Analysis
Study of original reason for nonconformance with a process. When the root cause is removed or corrected, the nonconformance will be eliminated.
A graph that plots performance data over time for a process, representing the data usually as a line chart.
A term used in statistics to represent standard deviation, an indicator of the degree of variation in a set of measurements or a process.
A statistical concept that measures a process in terms of defects – at the six-sigma is also a philosophy of managing that focuses on eliminating defects through practices that emphasize understanding, measuring, and improving processes. Article: What is the Purpose of Six Sigma?
The average difference between any value in a series of values and the mean of all the values in that series. This statistic is a measure of the variation in a distribution of values. Article: Key Concepts of Six Sigma
One of two values (lower and upper) that indicate the boundaries of acceptance or tolerated values for a process.
A graph in which individual points are plotted in two dimensions.
Software life cycle
The period of time beginning when a software product is conceived and ending when the product is no longer available for use. The software life cycle is typically broken into phases denoting activities such as requirements, design, programming, testing, installation, and operation and maintenance. Contrast with software development process. Article: Software Project Initiation: Organizational Role
Statistical Process Control (SPC)
Analysis and control of a process through the use of statistical techniques, particularly control charts.
Total Quality Management (TQM)
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. Article: Key Concepts of Six Sigma
Upper Control Limit
A horizontal line on a control chart (usually dotted), which represents the upper limits of process capability.
Any quantifiable difference between a specified measurement or standard and the deviation from such a measurement or standard in the output of a process.
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 mist affect the quality of outputs in any process, even if there are hundreds of steps in which a defect could occur – vital few.
X & R Charts
A control chart, which is a representation of process capability over time; displays the variability in the process average and range across time.
Is Step 7 of "Philip Crosby's 14 Step Quality Improvement Process." Although applicable to any type of enterprise, it has been primarily adopted within industry supply chains wherever large volumes of components are being purchased.