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Six-Sigma Levels

Learn about the basics of Six-Sigma or click one of the links below to go straight to the Six-Sigma A-Z or the Define Stage of DMAIC

Six-Sigma A-ZDefine Stage

Six-Sigma Levels | What are they…

Six-sigma is a data driven approach to solve problems. There are two main elements; Defects and Variation. We want 0 defects (or the least amount possible) and we want the process to be stable with little to no variance – so each and every time we deliver the same result in the same way.

Central to the lean six-sigma improvement methodology and to understanding sigma values is the term Defects. A defect is simply something which is not performing/presenting how it should. We can use Defects to understand the number of defects per million opportunities (DPMO), which in turn helps us to understand the sigma levels. The ambition is to work towards a level six-sigma, hence the name.

Sigma levels are as presented in the the table below – the higher the sigma level, the less Defects are presented:

Sigma-Level Percentage DPMO
Sigma 1 – Plus and minus 1 69% 690,000
Sigma 2 – Plus and minus 2 95.46% 308,538
Sigma 3 – Plus and minus 3 99.73% 66,807
Sigma 4 – Plus and minus 4 99.9937% 6,210
Sigma 5 – Plus and minus 5 99.999943% 233
Sigma 6 – Plus and minus 6 99.999997% 3.4
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Tip!

The sigma levels are not incremental. As you will notice from the above table the incremental improvement in sigma levels has a significant impact on the reduction of defects within a process.

Prior to understanding sigma levels we could be forgiven in assuming a process or service which achieves a 99% defect free position would be a good process. Let’s consider the airline industry if it operated at a 3-Sigma (99.73%) level, this would equate to 6 near fatal crashes per day – and increasing with the more planes in the air.

Now a six-sigma level would equate to 1 near fatal crash per year. Demonstrating that depending on what your process/service is for anything other than six-sigma is simply not an option.

Example | Insurance Claims

Now lets take a look at this with an example from then insurance industry. The below represents 100 insurance claims and the total elapsed days to process those claims. In this example the company has set a strict target of turning around those claims within 30 days.

Those marked up below in red have breached the 30-day target and therefore are out of the service level agreement (SLA). In six-sigma terms they are Defects. Using this sample we can now calculate the sigma level and the DPMO represented by this process.

 

20 29 15 15 26 16 26 15 19 20
28 11 19 19 19 22 26 3 25 36
13 12 30 21 24 37 30 17 22 11
22 24 13 15 16 29 24 27 19 18
19 16 29 23 12 22 21 29 14 22
21 28 33 13 21 22 22 27 20 22
22 18 10 30 23 10 17 14 34 14
16 16 27 24 27 26 14 27 24 26
42 33 12 11 10 18 10 15 12 21
30 25 16 21 29 13 16 12 27 30
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Tip!

The sample here is for illustrative purposes. When conducting your assessment be sure to consider the statistical validity of your data with an appropriate sample size.

The maths: Alternatively utilise our Sigma Calculators

DPU = The Number of Defects / Number of Opportunities

Example DPU = 6 (the six claims in the grid above which did not meet the 30 day SLA) / 100 (the number of claims assessed in the grid above)

Calculated Example DPU = 0.06

DPMO = DPU * 1,000,000 / 1

Example DPMO = 0.06 (DPU calculated above) * 1,000,000 / 1

Calculated Example DPMO = 60,000

Looking this up on the Sigma level grid shows this process to be in the region of Sigma level 3. So a long way to progress towards Six-sigma. 

Six-Sigma Additional FAQ’S

What are the Six-Sigma belts?

There are layers of Six-Sigma proficiency represented by belts, similar to those used within karate.

White Belt – Introductory level of knowledge and awareness – it’s the minimum standard.

Yellow Belt – Basic level of knowledge – participates as a team member delivering everyday continuous improvement

Green Belt – Fully Certified – Leads Green Belt projects and supports Black Belts with analysis for Black Belt projects

Black Belt – Expert Certification – Leads Black Belt projects which deliver significant business benefits

Master Black Belt – Master Certification – Trains and coaches Black and Green Belts. Operates at the programme level

What does FMEA stand for?

FMEA stands for Failure Mode and Effect Analysis. FMEA is effectively a risk analysis tool that is utilised within several stages of the DMAIC improvement lifecycle (Analyse, Improve and Control). For more on Six-Sigma Acronyms and Glossary see the A-Z

What are the 'Voices' which Six-Sigma projects listen to?

Six-Sigma and Lean projects necessitate particular ‘voices’ are listened to. These are the ‘voices’ of:

  1. Voice of the Customer (VoC) central to building processes around the needs of customers
  2. Voice of the Business (VoB) ensuring business requirements are adhered to, commonly but not exclusive to financials
  3. Voice of the Employee (VoE) ensuring employees benefit also from project changes
  4. Voice of the Process (VoP) the performance of the process over time

A project may be defined as a win-win-win when the Customer, Business and Employee all benefits from its delivery.

Why Process Map?

Process mapping allows an improvement project to represent the process visually in a way that others find easier to understand.

In addition, this makes it easier to ensure all parts have been accurately captured

  • It also allows people to quickly understand where waste exists in the process and where the process has gaps
  • It gives the team a basis for representing their improvement ideas

Being visually laid out allows the team to move things around and more easily ask difficult or challenging ‘what if’ questions to the process.

Continue learning…

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