Fall 2011(August 2011)

Master of Business Administration- MBA Semester 3 Total Quality Management Specialization QM0011 - Principles and Philosophies of Quality Management (4 credits)
(Book ID: B1241)

ASSIGNMENT- Set 1 Marks 60

Note: Each Question carries 10 marks. Answer all the questions.

Write a note on evolution of Quality. The concept of quality has existed for many years, though it s meaning has changed and evolved over time. The concern for quality has been evident throughout the history of organized production. In the craft Guilds of the late Middle Ages special measures were taken to inspect the work of apprentices and journeymen and to guard the Guild against claims of makeshift or shoddy work. The intent was to ensure that a trainee, craftsperson or artisan did not lower the product standards of the Guild. To the end of the eighteenth century the organization of work contributed positively to the quality of the end product. The tradesperson or artisan made most, if not all, of the product and were able to satisfy them self, by control of the process and inspection, as to the acceptability of the product. In the early twentieth century, quality management meant inspecting products to ensure that they met specifications. In the 1940s, during World War II, quality became more statistical in nature. Statistical sampling techniques were used to evaluate quality, and quality control charts were used to monitor the production process. The Industrial Revolution with its emphasis on factory-based, mass production directed by a central focus on profit had a major impact on: The nature of work which became fragmented and compartmentalized; The management of work which became the responsibility of professional managers; The attention placed on quality which became a secondary consideration trailing concerns such as productivity and profitability; and The processes used to manage quality In the 1960s, with the help of so-called quality gurus, the concept took on a broader meaning. Quality began to be viewed as something that encompassed the entire

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organization, not only the production process. Since all functions were responsible for product quality and all shared the costs of poor quality, quality was seen as a concept that affected the entire organization. The meaning of quality for businesses changed dramatically in the late 1970s. Before then quality was still viewed as something that needed to be inspected and corrected. However, in the 1970s and 1980s many U.S. industries lost market share to foreign competition. In the auto industry, manufacturers such as Toyota and Honda became major players. In the consumer goods market, companies such as Toshiba and Sony led the way. These foreign competitors were producing lowerpriced products with considerably higher quality. To survive, companies had to make major changes in their quality programs. Many hired consultants and instituted quality training programs for their employees. A new concept of quality was emerging. One result is that quality began to have a strategic meaning. Today, successful companies understand that quality provides a competitive advantage. They put the customer first and define quality as meeting or exceeding customer expectations. Since the 1970s, competition based on quality has grown in importance and has generated tremendous interest, concern, and enthusiasm. Companies in every line of business are focusing on improving quality in order to be more competitive. In many industries quality excellence has become a standard for doing business. Companies that do not meet this standard simply will not survive. As you will see later in the chapter, the importance of quality is demonstrated by national quality awards and quality certifications that are coveted by businesses. Write a note on the following: a. Cause and effect diagram b. Control charts and c. Pareto analysis Cause and effect diagram : Cause-and-effect diagrams are charts that identify potential causes for particular quality problems. They are often called fishbone diagrams because they look like the bones of a fish. A general cause-and-effect diagram is shown in Figure. The head of the fish is the quality problem, such as damaged zippers on a garment or broken valves on a tire. The diagram is drawn so that the spine of the fish connects the head to the possible cause of the problem. These causes could be related to the machines, workers, measurement, suppliers, materials, and many other aspects of the production process. Each of these possible causes can then have smaller bones that address specific issues that relate to each cause. For example, a problem with machines could be due to a need for adjustment, old equipment, or tooling problems. Similarly, a problem with workers could be related to lack of training, poor supervision, or fatigue. Cause-and-effect diagrams are problem-solving tools commonly used by quality control teams. Specific causes of problems can be explored through brainstorming. The development of a cause-and-effect diagram requires the team to think through all the possible causes of poor quality.

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A flowchart is a schematic diagram of the sequence of steps involved in an operation or process. It provides a visual tool that is easy to use and understand. By seeing the steps involved in an operation or process, everyone develops a clear picture of how the operation works and where problems could arise.

B. Control charts : Control charts are a very important quality control tool. These charts are used to evaluate whether a process is operating within expectations relative to some measured value such as weight, width, or volume. For example, we could measure the weight of a sack of flour, the width of a tire, or the volume of a bottle of soft drink. When the production process is operating within expectations, we say that it is in control. To evaluate whether or not a process is in control, we regularly measure the variable of interest and plot it on a control chart. The chart has a line down the center representing the average value of the variable we are measuring. Above and below the center line are two lines, called the upper control limit (UCL) and the lower control limit (LCL). As long as the observed values fall within the upper and lower control limits, the process is in control and there is no problem with quality. When a measured observation falls outside of these limits, there is a problem.

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C. Pareto Analysis : Pareto analysis is a technique used to identify quality problems based on their degree of importance. The logic behind Pareto analysis is that only a few quality problems are important, whereas many others are not critical. The technique was named after Wilfred Pareto, a nineteenth-century Italian economist who determined that only a small percentage of people controlled most of the wealth. This concept has often been called the 8020 rule and has been extended too many areas. In quality management the logic behind Paretos principle is that most quality problems are a result of only a few causes. The trick is to identify these causes. One way to use Pareto analysis is to develop a chart that ranks the causes of poor quality in decreasing order based on the percentage of defects each has caused. For example, a tally can be made of the number of defects that result from different causes, such as operator error, defective parts, or inaccurate machine calibrations. Percentages of defects can be computed from the tally and placed in a chart like those shown in Figure .We generally tend to find that a few causes account for most of the defects. Describe 14 points of Quality management given by Dr. Edwards Deming. Deming's business philosophy is summarized in his famous "14 Points," listed below. These points have inspired significant changes among a number of leading US companies striving to compete in the world's increasingly competitive environment. But the 14 Points pose a challenge for many firms to figure out how to apply them in a meaningful way that will result in continual improvement. The 14 points are given below: 1. Constancy of purpose: Create constancy of purpose for continual improvement of products and service to society, allocating resources to provide for long range needs rather than only short term profitability, with a plan to become competitive, to stay in business, and to provide jobs. 2. The new philosophy: Adopt the new philosophy. We are in a new economic age, created in Japan. We can no longer live with commonly accepted levels of delays, mistakes, defective materials, and defective workmanship. Transformation of Western management style is necessary to halt the continued decline of business and industry. 3. Cease dependence on mass inspection: Eliminate the need for mass inspection as the way of life to achieve quality by building quality into the product in the first place. Require statistical evidence of built in quality in both manufacturing and purchasing functions. 4. End lowest tender contracts: End the practice of awarding business solely on the basis of price tag. Instead require meaningful measures of quality along with price. Reduce the number of suppliers for the same item by eliminating those that do not qualify with statistical and other evidence of quality. The aim is to minimize total cost, not merely initial cost, by minimizing variation. This may be achieved by moving toward a single supplier for any one item, on a long term relationship of loyalty and trust. Purchasing managers have a new job, and must learn it.

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5. Improve every process: Improve constantly and forever every process for planning, production, and service. Search continually for problems in order to improve every activity in the company, to improve quality and productivity, and thus to constantly decrease costs. Institute innovation and constant improvement of product, service, and process. It is management's job to work continually on the system (design, incoming materials, maintenance, improvement of machines, supervision, training, retraining). 6. Institute training on the job: Institute modern methods of training on the job for all, including management, to make better use of every employee. New skills are required to keep up with changes in materials, methods, product and service design, machinery, techniques, and service. 7. Institute leadership: Adopt and institute leadership aimed at helping people do a better job. The responsibility of managers and supervisors must be changed from sheer numbers to quality. Improvement of quality will automatically improve productivity. Management must ensure that immediate action is taken on reports of inherited defects, maintenance requirements, poor tools, fuzzy operational definitions, and all conditions detrimental to quality. 8. Drive out fear: Encourage effective two way communication and other means to drive out fear throughout the organization so that everybody may work effectively and more productively for the company. 9. Break down barriers: Break down barriers between departments and staff areas. People in different areas, such as Leasing, Maintenance, Administration, must work in teams to tackle problems that may be encountered with products or service. 10. Eliminate exhortations: Eliminate the use of slogans, posters and exhortations for the work force, demanding Zero Defects and new levels of productivity, without providing methods. Such exhortations only create adversarial relationships; the bulk of the causes of low quality and low productivity belong to the system, and thus lie beyond the power of the work force. 11. Eliminate arbitrary numerical targets Eliminate work standards that prescribe quotas for the work force and numerical goals for people in management. Substitute aids and helpful leadership in order to achieve continual improvement of quality and productivity. 12. Permit pride of workmanship: Remove the barriers that rob hourly workers, and people in management, of their right to pride of workmanship. This implies, among other things, abolition of the annual merit rating (appraisal of performance) and of Management by Objective. Again, the responsibility of managers, supervisors, foremen must be changed from sheer numbers to quality. 13. Encourage education: Institute a vigorous program of education, and encourage selfimprovement for everyone. What an organization needs is not just good people; it needs people that are improving with education. Advances in competitive position will have their roots in knowledge. 14.Top management commitment and action: Clearly define top management's permanent commitment to ever improving quality and productivity, and their obligation to implement all

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of these principles. Indeed, it is not enough that top management commit themselves for life to quality and productivity. They must know what it is that they are committed to that is, what they must do. Create a structure in top management that will push every day on the preceding 13 Points, and take action in order to accomplish the transformation. Support is not enough: action is required! Describe the Philip Crosbys four absolutes of Quality Philip Crosby, author of Quality is Free, founded the Quality College in Winter Park, Florida. Crosby emphasized meeting customer requirements by focusing on prevention rather than correction. He claimed that poor quality costs about 20 percent of the revenue; a cost that could be avoided by using good quality practices. He pushed for zero defects. His "absolutes" are: (1) quality is defined as conformance to requirements, not goodness; (2) the system for achieving quality is prevention, not appraisal; (4) the performance standard is zero defects, not that are close enough; and (4) the measure of quality is the price of non-conformance, not indexes. Crosby espoused his basic theories about quality in four Absolutes of Quality Management as follows: 1. Quality means conformance to requirements, not goodness. According to Crosby, once the requirements are specified then quality is judged solely on the criteria of whether they are met or not; aesthetics or feelings dont come into it. It is then the duty of management to specify those requirements very clearly, to say what they want. This, Crosby believes, is one of the major failings of management. 2. The system for causing quality is prevention, not appraisal. In other words, prevention is better than detection or appraisal. This is very much in line with the philosophy behind SPC; understand the process, look at what can go wrong, and take preventative actions 3. The performance standard must be zero defects Here Crosby is stating that nothing less than perfect quality has to the aim. Setting targets below 100% is the start if a downward spiral. Of course, traditional quality management has taken zero defects to be uneconomic, and there should be a tradeoff between prevention costs and failure costs. The Crosby view is now supported by a developing view that prevention costs particularly where total quality is in place, do not necessarily rise massively as one approaches zero defects, but in fact rise by no more than failure costs fall. 4. The measurement of quality is the price of nonconformance, not indexes. Like Juran, Crosby believes in costing quality as a prime motivator for management. Crosby classifies costs into the price of Non conformance and price of conformance. Here Crosbys famous Quality is free is appropriate.

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Describe briefly the 5S principles. 5S is a list of five Japanese words, which, transliterated and translated to English, start with the letter S and are synonymous names of the methodology for organizing, cleaning, developing, and sustaining a productive work environment and to bring in efficient flow of activities These five words are part of a very basic management system that focuses employee s attention on 5S movement of the organization. The Japanese words, referred to as 5S process or house keeping steps are: 1. SEIRI (Sorting), Theme: Sorting, Tidiness [Sorting good and bad, useable and non useable] Sorting simply means to segregate what all to keep or stored at each work station, that is segregating unnecessary items into wanted and unwanted and discards the unnecessary items from the workplace. The golden rule is to remove anything that will not be used within next 30 days from the workplace. 2. SEITON (Straighten), Theme: Straighten or Orderliness: [Systematic arrangement & keep systematically and have traceability] The Systematic arrangement is keeping things in order of all the wanted items in a designated area at each workstation so that they are ready for use when required i.e. easy accessibility. This helps in minimizing searching and to find missing items through visual controls. 3. SEISO (Sweep or Spic and span), Theme: Cleanliness: Sweep/Scrub/Shine, Spic and Span Once the clutters/junks clogging the work areas are eliminated and only the necessary items are located properly through 1S and 2S, the next step is to thoroughly clean the work space and converts it into a tidy place, i.e. keep things ready to use in dirt free & tidy status. This includes cleaning of tables, pallets, racks, machines, tools, floors, and all items identified and kept as required for use through 1S and 2S. 4. SEIKETSU (Standardize) Theme: Standardized Cleanup: (Evolve standards and review for improvements of personal cleanliness) The standardization process involves 1. Assigning job responsibilities to all concerned in their work areas 2. Integrating 5S duties into normal work duties, and 3. Institute regular check on the maintenance of 5S. 5. SHITSUKE (Self-discipline). Theme: Sustaining Self discipline (Commitment at individual level to 5S-make a habit of maintaining established procedures) It is necessary to have discipline in all aspects of our work to improve quality of product and the work life. Japanese believe that with discipline and sincerity in following all such principles, one can contribute to personal as well as organizational success.

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What are the objectives and features of MBNQA? Objectives of MBNQA is to help and motivate American companies to plan their seven process categories of MBNQA model for superior business results with the following objectives: To establish guidelines that can be used by all agencies in evaluating Quality improvement efforts To help American companies to attain excellence in quality and productivity To Improve companys performance capabilities & their competitiveness To make organizations to focus on the market and offer ever-improving value to customers To Guide organization through its values, vision, mission, and set goals To Change the organization from function focused to customer focused. To make organizations to believe in continuous improvement To encourage and empower people to work in teams To Promote a transparent leadership process for achieving excellence To gather information from the winners about the quality improvement actions and results etc. and provide them as rewarding guidelines to other organizations. MBNQA promotes a) awareness of quality as an increasingly important element in competitiveness b) a clear understanding of the requirements for the quality excellence and c) encourages sharing of information of their success stories for the benefit of other organizations. MBNQA is awarded to resurgent American companies that showed the greatest amount of improvement in seven separate categories, called the Seven Pillars: 1) Leadership, 2) Information and Analysis, 3) Strategic Quality Planning, 4) Human Resource Development, 5) Management of Process Quality, 6) Operational Results and 7) Customer Satisfaction. The award is a public-private partnership and managed by Baldrige Award Organization, comprising of The National Institute of Standards and Technology

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and Foundation for Baldrige National Quality Award . The American society for Quality Control assists NIST, in administering the award. It is found that any company that is committed to performance excellence in quality is also committed to a) Corporate citizenship strategies b) Rational management c) Employs humane and employs human employment policies

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Master of Business Administration- MBA Semester 3 Total Quality Management Specialization QM0011 - Principles and Philosophies of Quality Management (4 credits)
(Book ID: B1241)

ASSIGNMENT- Set 2 Marks 60

Note: Each Question carries 10 marks

1. Describe briefly thePDCA Cycle and its importance. Deming also encouraged a systematic approach to problem solving and promoted the widely known Plan, Do, Check, Act (PDCA) cycle. The PDCA cycle is also known as the Deming cycle, although it was developed by a colleague of Deming, Dr Shewhart.

It is a universal improvement methodology, the idea being to constantly

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improve, and thereby reduce the difference between the requirements of the customers and the performance of the process. The cycle is about learning and ongoing improvement, learning in a systematic way what works and what does not work; and the cycle repeats; after one cycle is complete, another is started. 2. What is meant by Design of experiments? What are the salient features of Design of experiments? Taguchi observed that 80% of defective items are caused because of poor design. The Design of experiment technique is used to resolve these problems at the design stage itself. Organizations are achieving world class quality and improving productivity by using designed experiments, wherein the changes are intentionally introduced into the process or system and observe their effect on the performance characteristics. A statistical approach is used here for evaluating the changes in the variations/deviations before and after the experiment. Salient Features of Doe: 1. DOE is the method used for testing and optimizing the performance of a process, product, service or solution. 2. DOE techniques are important engineering approach which is based on developing a robust design: i.e. design of a product which can perform over a wide range of conditions. 3. DOE techniques are Tests of statistical significance, correlation and regression about the behavior of a product or a process under varying conditions. Statistical process control is a very powerful tool for optimization of a process, system, design etc. 4. Experimental design is a systematic manipulation of a set of variables, in which the effects are determined, conclusions drawn and results implemented. 5. Hence the Experimental design is the experimentation that makes the desired changes in the input variables of a process and measures the output response. 6. The Goals of a designed experimentation are to determine the variables and their magnitude, levels of these variables and evolve plan to manipulate these variables for the desired results. 7. It is necessary to reduce the variations in the performance characteristics, check to what extent these variables are having impact on cost and quality and to examine as to how to inject and manipulate these variables for a better design. 8. DOE tool is a very powerful tool that helps you to identify and quantify the effect of the X on the Y, that is, to determine which inputs are significant in affecting the output of a process.

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9. DOE is a means of identifying the most influential factors more efficiently through experiments with many factors simultaneously. As the number of factors rise, costs increases exponentially. 10. A typically designed experiment has three factors each set at two levels (maximum and minimum values). Such an experiment would require eight runs and results measured for each run. From these values, an empirical model is evolved to predict the process behavior 11. A good experiment must be efficient and a well planned set of experiments is one in which all the parameters of interest are varied over a specified range and collect systematic data until desired results are achieved. 12. Every experimenter develops a nominal process/product that has the desired functionality for end user and optimizes the processes/ products by varying the control factors, such that the results are reliable and repeatable (i.e. show less variations). 3. What is meant by Quality Circle? What are the significant characteristics and features of Quality circle? One of the first concepts that western management took back to their own shores was the quality circle. The quality circle concept represents the bottom up approach. In Japan in1988, there were one million quality circles, involving ten million people. Quality circles were originally study groups that workers formed in their department to study the quality concepts that were published in Quality Control for Foreman (Ishikawa was the editor). Quality circles involve members from within a department. The circle solves problems on a continuous basis. Circle membership changes dependent upon the task or project under consideration. Ishikawa believed that quality improvement initiatives must be organization-wide in order to be successful and sustainable over the long term. He promoted the use of Quality Circles to: 1. Support improvement; 2. Respect human relations in the workplace; 3. Increase job satisfaction; and 4. More fully recognize employee capabilities and utilize their ideas. Quality Circles are effective when management understands statistical techniques and act on recommendations from members of the Quality Circles. 4. Describe the concept of poka-yoke. Poka Yoke requires stopping processes as soon as the defect occurs, and next identifying the source of the defect, and then preventing it from happening again. The entire process can be called as Mistake Proofing and is a component of Poka Yoke, i.e. preventing errors at the source. All three types of inspection mentioned above rely on controls consisting of fail-safe procedures or devices called Poka-Yoke.

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Poka-Yoke includes check lists or special tooling that: 1. Prevent the worker from making an error during the process and stop further leads to defective manufacture. 2. Gives rapid feedback of abnormalities in the process to the worker in time to correct them. 3. There is a wide variety of Poka-yoke facilitating devices used for sophisticated detection and controls like electronic signaling devices. 4. Set up Poke-Yoke devices (mistake proofing devices) such as sensors and monitors to identify defects at the point of occurrences. 5. Referred to this system as a Zero Defect approach, because it is the ultimate goal. Mistake proofing can be an extension of FMEA [Finite Mode Element Analysis] or as an extraordinary disciplined way of shredding those defects. Whereas FMEA helps in the prediction and prevention of problems, mistake proofing emphasizes on the direction and correction of mistakes before they become defectives delivered to the customers. Shingos ideas were controversial as inspection becomes integral part of every step in a process, as opposed to being a separate responsibility. The heart of mistake proofing is simply to pay careful attention to every activity in the process and to place checks and problem prevention at each step. It is like an instantaneous feedback data transmitted from a cyclist ears to the brain regarding keeping his bike maneuvered on tough terrain. 5. Describe the eight pillars of Total Productive Maintenance. There are 8 Pillars that supports a strong structure of TPM for achieving higher productivity. They are shown in the below figure:

Pillar-1: Autonomous Maintenance: (Jishu Hozen)

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Autonomous maintenance is a phrase coined by the Japanese institute of plant maintenance (JIPM) to describe the shift towards the machine operators maintaining their own machine / equipment Pillar-2 Kobetsu Kaizen or Individual Improvement Kobetsu Kaizen (KK) or individual improvement is to move towards zero losses of all kinds. Sixteen major kind of losses (such as breakdowns, changeover times, etc.) are identified, their current level calculated, and goals are set for improvement in overall equipment efficiency (OEE) Pillar-3 Planned Maintenance The planned maintenance (PM) pillar of TPM has an objective of improving the efficiency of the maintenance department. It comprises the following types of maintenance. preventive maintenance daily maintenance periodic maintenance time based maintenance overhauls predictive maintenance condition-based maintenance (CBM) breakdown maintenance corrective maintenance

Pillar-4 Hinshitsu Hozen or Quality Maintenance Hinshitsu Hozen or quality maintenance focuses upon setting targets for ensuring the quality of products. These targets can be reduction in process failures, consumer complaints, and retention time of trucks for raw and processed materials and at the same time, increasing the number of product-related Kaizens. Pillar-5 Early Management or Development Management Early management or development management helps in drastically reducing the time taken to receive, install, and set-up newly purchased equipment (known as vertical start-up). Early management can also be used for reducing the time to manufacture a new product in the factory. 6 Pillar-6 Education and Training

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Education and training emphasizes upon hard engineering training, with production operatives becoming familiar with the equipment they operate and gaining the practical skills to operate and maintain it, and with maintenance staff acquiring advanced maintenance skills and predictive maintenance techniques, such as shock pulse monitoring, vibration analysis, oil debris analysis, etc, Pillar-7 Safety, Health and Environment The safety, health and environment (SHE) pillar of TPM strives to achieve the objective of zero accidents and defects and reducing the level of human effort required attaining a given level of production. 8 Pillar-8: Office TPM Office TPM, as the name suggests, focuses upon improving the productivity and infusing efficiency in the administrative support functions of the organisation by identifying and eliminating losses. 6. What is meant by Six Sigma? What are the steps in implementing Six Sigma? Six Sigma is a management philosophy developed by Motorola that emphasizes setting extremely high objectives, collecting data, and analyzing results to a fine degree as a way to reduce defects in products and services. The Greek letter sigma is sometimes used to denote variation from a standard. The philosophy behind Six Sigma is that if you measure how many defects are in a process, you can figure out how to systematically eliminate them and get as close to perfection as possible. In order for a company to achieve Six Sigma, it cannot produce more than 3.4 defects per million opportunities, where an opportunity is defined as a chance for nonconformance. Six Sigma emphasizes breakthrough rates of improvement, and focuses on world class performance to achieve organizational success. Sometimes, Six Sigma helps a company improve quality and achieve business goals; other times, it slips into a quality quagmire. If we understand the history and core concepts of Six Sigma engineering, we can implement Six Sigma successfully in our businesses. It took five full years to see significant results of Six Sigma. The benefits of Six Sigma are: process flows are improved defects are reduced communication is Improved as the whole organization works towards common goals cycle times are reduced

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customer satisfaction improved employee satisfaction improved productivity is increased capacity and output are improved quality is improved reliability of products and processes are improved unit costs decreased designs improved time to market is quicker better delivery time

Steps in Implementing Six Sigma Let us take the example of Johnson Controls (JC) India for understanding the DMAIC (define, measure, analyze, improve, and control) process of Six Sigma. This organization deals with building control systems, automotive seating equipment, energy, and integrated facility management services. The following steps are followed while implementing Six Sigma in the organization. Step 1 Define the priorities of the customers with respect to quality. In this step, those attributes of the produced are identified that are considered most important by the customers in evaluating the quality of the product. These attributes are called critical to quality characteristics (CTQ). The customers perception about quality attributes are updated from time to time by conducting customer surveys. Quality function deployment (QFD) is a powerful tool in the define step of DMAIC. The logistic department of JC India was facing the problem of a long delivery time of around 60 days to is customers and multiple freight agents. Many meetings for defining the problem resulted in the identification of a single-most important issuethe route followed for the delivery of consignments from the US headquarters of JC in Milwaukee, USA, to Singapore, and then to India. This was costing the company lost time and more cost, with the use of many freight agencies in between resulting in more paper work and hassles. Step 2 Measure the processes and the defects arising in the due to the process. The important process influencing the CTQs is identified and performance measurement techniques are established for these processes. Measurement of processes and thus the

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defects arising in the product due to the processes is done. At JC India, during the measure phase, it was found that 9% of the cif (cost, insurance, and freight) value of shipments was involved in the transportation from the US to Singapore and an additional 4% for transportation from Singapore to India. Also, 5% of the free-on board (fob) value was constituted by handling charges. Step 3 Analyse the process to determine the most likely causes of defects. The key variables most likely to be responsible for variation in the process are identified to find the reason for generation of defects. At JC India, the six sigma level of this transportation process was found to be less than 1 (meaning 69% chance of failure). After analysis, it was decided that it was necessary to drop Singapore from this transportation route in order to make the supplies directly from US to India. Step 4 Improve the performance of the process and remove the causes of the defects. The specification limits of the key variable are fixed and the system established for measuring the deviations of the variables is validated. Improvisations in the process are done in order to keep the variable within the specification limits. Johnson Controls India removed Singapore from its route map and the supplies were sent directly from the US to India by using a single freight agency-Burlington Express. This resulted in reduced delivery time to 49 days from the earlier 69 days and more than 10% reduction in freight costs. The ultimate result is the increase of EBIT (earnings before interest and tax) for JC India by 60%. The quality of life has also improved for the employees as they get free by six, while earlier they had to be in office till well past seven. Step 5 Control to ensure that the improvements are maintained over time. The modified process is subjected to vigil at regular intervals of time to ensure that the key variables do not show any unacceptable variations (beyond the specification limits). There are certain situations where the project team members may feel that a process needs to be replaced by a new process rather than improving the existing process. The demands of the customers with regard to quality cannot be satisfied by the existing process. At times, an organization may decide to launch a new product or service to grab a new business opportunity offered by the environment. In all such situations, the last two steps in the DMAIC, namely, improve and control have to be replaced by design and verify so that it becomes DMADV. Certain Six Sigma companies prefer to apply DMAIC in these situations also. In fact, it hardly matters as the activities are adjusted according to the nature of the project. The design of new processes or redesign of existing processes using DMADV is known as design for Six Sigma (DFSS) or Six Sigma design (SSD).

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