DMAIC,

DMEDI

and

Process

Management

QuickReference

For Project andProcess Review

PURPOSE OF GUIDE

Purpose of this GuideThe primary intent of this quick referenceguide is to aid process owners, sponsors andstakeholders guide and mentor 6 Sigma projectteams as they progress through the variousphases of a DMAIC or DMEDI project.

Please use this guide during all leadershipreview meetings (‘gateways’) as a base levelof talking points to ensure the project teamsare indeed adhering to the proper methodology.Please pay special attention to the criticalpoints listed for each phase, as these are thekey points and milestones each project teamshould at a minimum be achieving prior tomoving to subsequent phases.

Additionally, the Process Managementsection of this guide offers Process Ownersa framework from which to organize, scheduleand facilitate periodic process reviews.These reviews will be critical to the assurancethat improved and/or created processes arebeing maintained according to the processcontrol system and that benefits continueto accrue.

PURPOSE OF REVIEWS LOGISTICS/SAMPLE AGENDA

Purpose of Leadership Reviews• To monitor team progress• To reinforce priorities• To align and realign activities with business

strategies• To provide guidance and direction• To check for consistent understanding• To share successful practices• To assist the team in identifying and providing

resources needed to be successful, and indealing with sensitive issues.

• To gather data from the organization for improvedcoordination, management and planning.

• To show visible support for improvement efforts• To provide ongoing coaching and instruction• To recognize and reward efforts

LOGISTICS/SAMPLE AGENDA

Participants• Team leader and team members• Project Sponsor• Master Black Belt• Process Owner(s)• Other managers and stakeholders as

appropriate

FrequencyMinimally, reviews should be conducted at theend of each phase.

Guidelines• Formal or informal• Sponsor should schedule review• Minimize special preparation by the team• Team sends storyboard or presentation to

reviewers 2-3 days before the review• Reviewers should not judge the team

Sample Agenda1. Brief introduction by Sponsor2. Presentation by the project team3. Reviewers share the following:

• Strengths in logic and data• Questions for clarification• Suggestions to consider

4. Questions and comments from project team5. Brief closing by Sponsor

ASSURING TEAM SUCCESS QUESTIONS

Team SuccessPurposeTo ensure the team is properly outfitted forsuccess in using the 6 Sigma DMAIC and/orDMEDI methodology.

Critical Points• Team has been assigned a leader and a

Master Black Belt• Black Belt and team members trained in and

following the DMAIC and/or DMEDI methodology• Team has scheduled and held frequent

meetings• Team members regularly attend all meetings• Team members have the time necessary to

complete assignments between meetings• Reviews are regularly conducted• Effective team collaboration• Team has a plan for completing the project• Team is documenting its work• Team has adequate resources• Team has engaged the process owner early

in the project• Team has engaged the financial

representative early in the project.• Black Belt understands the fundamental

concepts of the 6 Sigma financial guidelines.• Team members clearly understand roles and

responsibilities.

Relevant Tools & Skills• Facilitation• Project Plan/Gantt Chart• Training

QUESTIONS

Team Success Questions• Who are the assigned team leader and Master

Black Belt for the team?• Have all team members been trained? Was it

the proper content?• How much time does the Master Black Belt

spend with your team?• How often does the team meet?• What is the attendance percentage at meetings?• How much time do members spend outside

of meetings working on the project?• Are there barriers for collaboration within

the team? If so, what plans are there toaddress them?

• When did the project start? When is theplanned completion date? Is the project onschedule?

• How is the team tracking and documentingits accomplishments?

• What other resources does the team needto assure success?

• Who is the financial representative for theproject and have they been engaged?

• Who is the Process Owner and have theybeen engaged?

DMAIC REVIEWS DMAIC OVERVIEW

DMAICReviews

DMAIC OVERVIEW

DMAIC OverviewDMAIC is the acronym used to refer to the6 Sigma improvement process. The five-phaseprocess of Define, Measure, Analyze, Improveand Control is used to improve existing processes,products and services to 6 Sigma quality.

Data and statistics are used to reveal the rootcause of the problem, thus optimizing theefforts to concept and test solutions.

DEFINE QUESTIONS

Define PhasePurpose• To define the customers and their requirements

(VOB->CCRs)• To define Process Partners and their business

requirements (VOB->CBRs)• To develop and refine a team charter• To map the business process to be improved

Critical Points• Customers/process partners

identified/segmented as appropriate. Data toverify customers’/process partners’ needs andrequirements collected and plotted

• Written team charter includes rationale forproject, preliminary problem statement, scope,goals, milestones, and roles andresponsibilities

• Completed and validated high-level “as is”process and/or system map which identifiessuppliers, inputs, five to seven process blocksof activities, outputs and customers

Relevant Tools/Concepts• Brainstorming• CCR/CBR Tree• Customer Surveys• Prioritization Matrix• Process Map

• Project Plan otherVOC/VOB chart tools

• Communication Plan• Project Risk

Assessment

QUESTIONS FOR DEFINE PHASE

Questions for Define PhaseCustomer• Who is the customer?• Who are the process partners?• How were the relevant customer/process

partner segments determined?• Is there data to understand the

customer/process partner requirements?

Charter• What are the compelling business reasons for

completing this project?• What key business output measure will this

project impact? How?• What is the problem being addressed?• What are the boundaries or scope of this

project?• Who are the stakeholders that will be affected

by this project? How will data be used tounderstand and address concerns?

• Has this or a similar problem been solvedbefore?

• Can we learn from their effort?• What is the goal for the project? Is it reachable?• How will we know if the team is successful?• Are milestones established with dates?

Process/System Map• How was the map developed?• How was the map validated?• Is the process actually followed?

MEASURE QUESTIONS

Measure PhasePurpose• Identify project Y=f(x) and performance

standards• Collect data on Y, x and related process

measures• Determine process/system capability

(baseline performance)• Set the improvement goal for the project

Critical Points• Agreement upon the key measures• Identification and definition of critical defects in

the process/system• Sound data collection plan and measurement

systems analysis• Process variation displayed using appropriate

charts and graphs• Baseline measurement of process capability

and process sigma level

Relevant Tools/Concepts• Check sheets• Control Chart• Gage R&R• Histogram• Measurement

Systems Analysis(MSA)

• OperationalDefinition

• Opportunity• Process/system Map• Run Chart• Sampling Techniques• Yield

QUESTIONS FOR MEASURE PHASE

Questions for Measure Phase• Have any charter revisions been made?

How has this changed the scope andobjectives of the project?

• What key output, process and input measuresare critical to understanding the performanceof this process/system?

• What are the definitions of defect, unit andopportunity that you will use to calculateprocess sigma levels?

• What is your data collection plan?• How much data did you collect? How did

you sample?• What stratifying factors will you use in your

data analysis?• What have you done to ensure the reliability

and validity of the measurement process?• What display tools were used to assess the

performance of your process?• What are the current process measures and

goal for this project?• Have you found any “quick win” improvements?• How were they implemented? What barriers

arose? How did you overcome?• Is the scope of the project manageable?• Has the financial baseline from which benefits

will be measured been established?• Has the Process Owner been identified?• Is there enough improvement opportunity from

the baseline to continue the project?• Is the project on schedule?• Have revised benefits been entered into

eTracker?

ANALYZE QUESTIONS

Analyze PhasePurpose• Identify key sources of variation by analyzing

data and process/system.• Quantify the financial opportunity for the project.

Critical Points• A prioritized list of all possible sources of

variation for the process• A focused list of critical sources of variation

that strongly impact the project Y• A sound, logical path that shows steps and/or

tools used to narrow the list. This may include:➣ A detailed and analyzed “as-is” process map.➣ Use and display of data to identify, verify

and quantify root causes and the key factors➣ Designed experiments to identify key Factors

• A refined problem statement resulting fromthe analysis.

• Dollar estimates of the financial opportunityfor the project

• Process ownership must be established priorto moving to the Improve phase.

ANALYZE (CONTINUED)

Relevant Tools/Concepts• Cause & Effect

Diagram (Fishbone)• Check sheet• Cost/Benefit Analysis• Design of

Experiments• Histogram• Hypothesis Tests

(t-test, ANOVA,Chi Square)

• Non-value-AddedAnalysis

• Pareto• Process Map• Regression• Scatter Diagram• Stratification

QUESTIONS FOR ANALYZE PHASE

Questions for Analyze Phase• Have any charter revisions been made?

How has this changed the scope and objectivesof the project?

• Which root cause analysis tool did you use tohelp you identify potential root causes?

• What are the root causes of the problems?How did you draw those conclusions?

• Show me your detailed process map.• Did you collect additional data? What was

measured? What did you learn from the analysis?• What is the opportunity represented by

addressing the problem? What are thequantifiable costs of our current processperformance? What are the anticipated impactson customer satisfaction, retention, and loyalty?

• How could this increase our capacity?• How could this improve our ability to improve

our process controls?• Have you found any “quick win” improvements?

How were they implemented? What barriersarose? How did you overcome?

• Have revised benefits been entered intoeTracker?

• Has the financial representative been notifiedof significant changes in facts or assumptions?Is the revised financial opportunity significantlydifferent from the Project Sponsor’s initialestimate?

• Is the project on schedule?• Who is the Process Owner and have they

been engaged?

IMPROVE QUESTIONS

Improve PhasePurpose• To generate and test possible solutions• To select the best solution(s) to address the

most critical sources of variation for the process• To identify the required resources and plan for

successful implementation

Critical Points• Potential solutions and alternatives to the

problem tested• Best solution selected based on data collected

during testing• “Should be” process/system map• Cost/benefit analysis of proposed solution• Impact assessment of project improvements

developed• Full implementation plan including project and

change management plans• Contingency Plan developed• Process Owner is actively involved with

solution development

IMPROVE (CONTINUED)

Relevant Tools/Concepts• Creativity• Brainstorming• Cost/Benefit Analysis• FMEA• Prioritization Matrix

• To-Be Process Map• Project Plan/Gantt

Chart• Potential solutions

QUESTIONS FOR IMPROVE PHASE

Questions for Improve Phase• How did you generate solution alternatives?

What criteria did you use to evaluate potentialsolutions?

• How does the evaluation criteria tie intobusiness strategy and project objectives?

• Show me your “should be” process map.• How does your preferred solution address the

root cause of the problem?• Walk me through your cost/benefit analysis.

What assumptions were made? Did youvalidate the cost/benefit analysis with afinancial subject matter expert?

• Have hand-off’s to areas outside the projectscope been identified? Addressed?

• Explain the compelling need for this change.What is your communication plan? What thingshave been considered to manage the culturalaspects of the change?

• Has the financial representative been notifiedof any significant changes in the projectedfinancial opportunity? Have those changes inbenefits been entered into the appropriatesystems?

• Is the project on schedule?• Was the Process Owner engaged in

developing the solutions?

CONTROL QUESTIONS

Control PhasePurpose• To implement the process improvement in

all areas• To implement a plan for sustaining the

improvement

Critical Checkpoints• Solution piloted on a small scale with data

collected and analyzed• Process and financial control plans that

assure the improvement gains are sustainedlong-term

• New process documentation and otherevidence to assure the solution becomes partof daily work

• Response plans developed and deployed• Full implementation of the process

improvement• Broader systems and structures changes to

institutionalize the improvement• Confirmation of defect reduction and improved

process capability• Results translated to other processes with

similar improvement requirements• Financial impact of process improvement have

been quantified by the Team Leader andvalidated by the financial representative

• Process Owner has accepted full responsibilityfor controlling the process and reporting thefinancial impact

CONTROL (CONTINUED)

Relevant Tools/Concepts• Control Chart• Histogram• Pareto• Piloting• Procedures

• Process Sigma (Z st)Calculation

• Response Plan• Training• Process control

system

QUESTIONS FOR CONTROL PHASE

Questions for Control Phase• How was the solution tested on a small scale?

What did you learn about full-scaleimplementation from the pilot?

• What is the implementation plan? What trainingis required?

• How will the implementation plan be monitoredto ensure its success? Who is accountable?

• What controls are in place to assure that theproblem does not reoccur? Is a response planin place for when the process measuresindicate “out of control”?

• Who is the process owner? How will responsibilityfor continued monitoring and improvement betransferred from the team to the owner?

• What barriers to change remain that willprevent institutionalization of the improvement?Are actions contained in your plan to addressthese?

• What did the team learn from the project?Are there others that can benefit from theselessons? How can they be effectively shared?

• What did you, as a team, learn about theprocess of making improvements?

• What is the next problem that should beaddressed in this process?

DMEDI REVIEWS DMEDI OVERVIEW

DMEDIReviews

DMEDI OVERVIEW

DMEDI OverviewDMEDI is the acronym used to refer to the6 Sigma creation process. The five-phase processof Define, Measure, Explore, Develop andImplement is used to create new processes,products and services to 6 Sigma quality.

Define PhasePurpose• Understand business risk and project risk • To develop and refine a team charter• To identify a new product or service• To develop a project management plan

Critical Points• Written team charter includes rationale for

project, scope, goals, milestones, and rolesand responsibilities

• Documented project plan includes controls,reviews, deliverables, and timeline.

• Business risk and project risk examined anddocumented by team and sponsor

• Project management plan includes changemanagement, communications, and riskassessment.

Relevant Tools/Concepts

DEFINE QUESTIONS

• In and out ofscope tool

• eTracker• MGPP

• BRM and PRA• Project

management plan• Communication plan

QUESTIONS FOR DEFINE

Questions for Define PhaseCustomer• Who are the customers and process partners?• Is there data to understand the requirements?

Charter• What are the compelling business reasons for

completing this project?• What key business output measure will this

project impact? How?• What are the boundaries or scope of this project?• Who are the stakeholders that will be affected

by this project? How will data be used tounderstand and address concerns?

• How will you communicate key project issuesto these stakeholders?

• Has this or something similar been designedbefore? Can we learn from their effort?

• What is the goal for the project? Is it reachable?• How will we know if the team is successful? • Are milestones and timelines established?• Is this part of a multi-generational project/process

plan? What are the generations?• Have risk management tools been used to

help balance risk and control?

MEASURE QUESTIONS

Measure PhasePurpose• Identify customers and or process partners• Identify and segment customers and/or

process partners• Gather and analyze customer and/or process

partner needs (VOC & VOB)• Translate the VOC/VOB into Critical Customer

Requirements (CCRs & CBRs) with goals andtargets

Critical Points• Agreement upon the key customer segments • Prioritization of customer/process partner

segments• Selection of customer/process partner

research methods• Build VOC/VOB data collection plan• Organize customer/process partner information• Prioritize customer/process partner needs• Develop specific, measurable CCRs/CBRs

with targets and specs• Create project scorecards to be used

throughout the project to compare designresults to CCRs/CBRs

Relevant Tools/Concepts• Affinity diagram• Customer research

methods• Customer/process

partner surveys/interviews

• Scorecards• Kano analysis• Performance

benchmarking• QFD• Structure tree

QUESTIONS FOR MEASURE PHASE

Questions for Measure Phase• How were the relevant customer segments

determined?• What is your data collection plan?• How much data did you collect? How did

you sample?• What stratifying factors will you use in your

data analysis?• What have you done to ensure the reliability

and validity of the measurement process?• What are the results of the QFD analysis?• Has a scorecard with CCRs and sigma

capability targets been developed?• Have you reviewed the MGPP?• Has the BRM and PRA checkpoint process

been used to assess risk?• Have any charter revisions been made?

How has this changed the scope and objectivesof the project?

EXPLORE QUESTIONS

Explore PhasePurpose• Generate concepts• Synthesize and select design elements• High level process design complete

Critical Points• Product/Service functions have been defined• CCRs/CBRs have been deployed/allocated

to functions• Alternative design concepts have been

developed• Best performance products/processes have

been benchmarked• Top concepts have been evaluated against

appropriate criteria• Design elements have been developed along

with requirements for processes, facilities,jobs, systems, etc

• Functional/Process requirements have beentransferred to design requirements

• Completed capability assessment of highlevel design

• A best-fit design has been selected and reviewedfor customer and process partner feedback.

• Critical design resources have been identified.• Design review conducted• Process ownership must be established prior

to moving to Develop.

EXPLORE (CONTINUED)

Relevant Tools/Concepts• Benchmarking• Design scorecards• FMEA• Functional analysis• Layout diagrams• Process maps• Process models• Creativity tools

• Design formanufacturabilityand assembly

• Prototyping• Pugh matrix• Function tree

analysis• Non-parametric

statistics

QUESTIONS FOR EXPLORE PHASE

Questions for Explore Phase• Did you collect additional data on the concept?

What was measured? What did you learn fromthe analysis?

• How did you generate these concepts?• Have all design elements been considered

and appropriately developed, including process,information, facility, human, material andequipment? Should any others be considered?

• What criteria were used to select the proposedconcept?

• Who was used for the benchmark best processor product?

• Who were the customers that gave feedbackon the concept? Why were they chosen?

• What tool was used to perform the riskassessment? What did it show?

• How were the concepts/designs developed?• What is the capability of the concept/design?• Have any charter or MGPP revisions been

made? How has this changed the scope andobjectives of the project?

• Has the BRM and PRA checkpoint processbeen used to assess the risks of alternativeconcepts?

• What is the opportunity represented by thecompletion of this project?

• Who is the Process Owner and have theybeen engaged?

DEVELOP QUESTIONS

Develop PhasePurpose• To generate and evaluate possible designs

that are optimized to meet the CCRs/CBRs• To develop a product or process control strategy• To develop a product/process pilot plan

developed• To assess project risks

Critical Points• Detailed products/processes for best design

developed• Best design selected based on data collected

during design capability analysis• Detailed process/system map• Cost/benefit analysis of proposed solution• Impact assessment of project design developed• Control strategy developed

DEVELOP (CONTINUE)

Relevant Tools/Concepts• Control plan• Design scorecards• FMEA/EMEA• IT logical/physical

design• Job Design• Pilot/Test plan• Process management

charts• Process/system Map

• Design formanufacturabilityand assembly

• Simulation software• Robust parameter

design• Robust tolerance

design• Specifications• Standards/

procedures• Design of experiment

QUESTIONS FOR DEVELOP PHASE

Questions for Develop Phase• How did you generate design alternatives?

What criteria did you use to evaluate potentialdesigns?

• How does the evaluation criteria tie intobusiness strategy and project objectives?

• Show me your detailed process/system map.• How does your preferred design address the

CCRs/CBRs?• Walk me through your cost/benefit analysis.• What assumptions were made? Did you validate

the cost/benefit analysis with a financial subjectmatter expert?

• How was the design analyzed?• Have hand-off’s to areas outside the project

scope been identified? Addressed?• What things have been considered to manage

the cultural aspects of the implementation?• Has the performance and capability

assessment been done?• Have hazards been identified and impacts

assessed?• How was the simulation conducted? What was

the process performance?• Have any other project risks been identified?• How was the technology/concept optimized?• How robust is the product/service?• How do you plan to pilot the product/service?• Has the financial representative been notified of

any significant changes in financial opportunity?Have those changes been documented?

• Have BRM and PRA processes been used toassess and mitigate risk?

• Who is the Process Owner and have theybeen engaged?

IMPLEMENT QUESTIONS

Implement PhasePurpose• To verify the design in pilot• To validate the product/process with

full-scale results• To implement the design and transition

to process management• To collect relevant project documents and

lessons learned• To celebrate successful project completion

Critical Checkpoints• Design verification through pilot testing• New product/process documentation to assure

the solution becomes part of daily work• Response plans developed and deployed• Full implementation of the process design• Process qualification through full-scale

processes• Performance evaluation based on full-scale

results• Training completed• Process control plans in place for turnover

to process owner• Process Owner in full agreement to take

responsibility of new product/process/servicedesigned in project

• MGPP reviewed• Project closure

IMPLEMENT (CONTINUE)

Relevant Tools/Concepts• Capability analysis• Control charts• Control plans• Design scorecards• DMAIC• MGPP

• Process managementcharts

• Project Planning• Standards and

procedures

QUESTIONS FOR IMPLEMENT

Questions for Implement Phase• What did you learn about full-scale

implementation from the pilot? How did theproduct/service perform during the pilot?

• What is the implementation plan? What trainingis required?

• How will the implementation plan be monitoredto ensure its success? Who is accountable?Has the project documentation been completed?

• What controls are in place to assure that theprocess/product meets CCRs/CBRs? Is aresponse plan in place for when the processmeasures indicate “out of control”?

• Who is the process owner? How will responsibilityfor continued monitoring and improvement betransferred from the team to the owner?

• What barriers to change remain? Are actionscontained in your plan to address these?

• What did the team learn from the project?Are there others that can benefit from theselessons? Have they been documented?How can they be effectively shared?

• What plans are there for furthercommercialization?

• Has the multi-generational product/processplan been updated?

DMAIC/DMEDI REVIEW PROJECT NOTE FORM

Project: _______________________________

Review Meeting Date: ____________________

Phase in DMAIC/DMEDI completed:_________

• Brief status of the project:

• Key messages from the reviewers:

• Agreed-upon next steps:

• Suggestions for improving the next review:

• Issues/concerns.

DMAIC/DMEDI REVIEW PROJECT NOTE FORM

Date: _________________________________

• Business:_____________________________

• Process: _____________________________

• CCR: ________________________________

• Current Sigma: ________________________

• Target Sigma: _________________________

• Customer Benefit: ______________________

____________________________________

• Estimated Financial Impact: ______________

• Financial Impact To Date: ________________

• Start Date:____________________________

• Estimated Completion Date: ______________

• Master Black Belt: ______________________

• Black Belt: ____________________________

Notes: (Issues/Challenges).

PROCESS MANAGEMENT REVIEWS

ProcessManagement

Reviews

PROCESS MANAGEMENT REVIEWS OVERVIEW

Process Management OverviewProcess Management is the means by whichwe ensure the improved/created outcomes of6 Sigma projects continue year over year.

Regularly scheduled process managementreviews, after project completion and closure,should be scheduled and facilitated by theProcess Owner. These reviews are intendedto ensure improved/created processes andsystems are being maintained and usedaccording to the process control systemand that benefits continue to accrue.

Process Management Purpose• To verify the process is being implemented

according to the process control system.• To ensure consistency, especially when team

members change jobs.• To help prevent leakage of savings resulting

from process improvements.• To provide the opportunity for voices external

to the team, including customers, to providefeedback on the process.

PROCESS MANAGEMENT REVIEWS OVERVIEW

Critical Points• Process owners are accountable for

completing process reviews and shouldcritically evaluate the process and financialperformance

• There are several types of process reviewsincluding: structured/formal review meetings,inclusion in other meetings, “managing bywalking around”, and periodic (annual,monthly, etc.)

• Participants in the reviews should include:Process Owner (leads the review), individualswho are responsible for collecting or reportingdata, individuals responsible to respond tometrics, key stakeholders and possiblycustomers.

• Outputs of the reviews may include: list of keyissues raised, list of action items and who isresponsible for each item, schedule of futuremeetings to assess completion of actionitems, schedule of future process reviewmeetings, updated process control systemincluding effectively dates and/or versiontracking, validation in eTracker.

Relevant Tools/Concepts• Process review and turnover checklist• Process control system• eTracker

QUESTIONS FOR PROCESS REVIEW

Questions for the Process Review• Has a process control system been developed,

validated and approved by stakeholders andis it being adhered to?

• Does the process description reflect a keyprocess, job or group of work tasks usingsimple and general terms and do the owners,customers and users understand it?

• Does the process purpose describe theprocess outcome in a measurable way andis the process outcome being measured?

• How well are the customer’s requirementsbeing met?

• Is there a process map that shows the requiredactivities, individual and cross-functionalaccountability, and the process roles andresponsibilities of all involved? Is the processmap accurate and being followed?

• Is there a set of indicators that measurecompliance of critical process activities toprocess specifications and provide upstreamindication of the quality of the outcome of theprocess? Are the indicators being met?

• Are there specification limits or targets thatdefine acceptable levels of qualityperformance and are these being met?

• Are checks being done at specified intervalsand by the accountable individuals?

• What are the key issues that were raisedduring the review?

• Is there a list of action items, which includesresponsible parties, and due dates?

• Is there a schedule of future meetings toassess completion of action items?

• Is there a schedule of future design reviewmeetings, if needed?

• Does the process control system need to beupdated, and if so, who is responsible?

• Is the eTracker information correct, and if not,when will it be updated and by whom?

• Is the value created continuing to bemeasured and sustained?

GLOSSARY

GLOSSARY

3 Ps: Performance through 6 Sigma, ProfitableGrowth and People.

AFFINITIZE: A term coined by the 6 Sigmacommunity that describes the process of thecategorizing or organizing of similar concepts,ideas, issues, etc into logical or similar groups.Often done after brainstorming sessions tocreate an ‘affinity’ chart/diagram.

BENCHMARKING: The practice of assessingthe performance or processes of another companyand identifying best practices with the goal ofimproving internal process performance.

BENEFITS: Level 1 benefits have a directand certain impact on the enterprise bottom lineand there is a clear cause and effect relationshipbetween the project and resulting gain thatcan be quantified and measured on theincome statement.Level 2 benefits result from the productiveredeployment of human (whole salaried ormanagement employees only) and capitalresources to functions or areas with ademonstrated need.Level 3 benefits generally create potentialopportunities for future savings and the impactto the bottom line is “more likely than not”(i.e. greater than 50% confidence level) orthe baseline cost is not in our existing coststructure (i.e. cost avoidance.)

BLACK BELT: A full-time resource trained inDMAIC and/or DMEDI whose role is to lead6 Sigma projects.

GLOSSARY

BOUNDARYLESS: The ability to think andact beyond your own business unit needs forthe benefit of the enterprise. Boundarylessbehavior is a requirement for successful6 Sigma deployment.

CHARTER: A document that outlines thepurpose and plan for a project. It contains astatement of the problem, the scope of theproject, an improvement goal, timeline, estimatedfinancial benefits, and a list of team membersand their roles.

CHECK SHEET: A simple form for trackingevents using tally marks to indicate the frequencyof an occurrence.

COMMON CAUSE VARIATION: (Also calledrandom variation or noise) A steady but randomdistribution of change in a process measurementaround the average value of the data caused byunknown factors. Common cause variation is ameasure of the process’s potential, or how wellthe process can perform when special causevariation is removed.

CONTAINMENT: Containment is a temporaryintervention used to minimize a problem’simpact on the customer while the improvementteam works to resolve the issue with a long-term solution.

CONTINUOUS DATA: Information measured ona continuum or scale that can be meaningfullysubdivided into infinitely small increments,depending upon the precision of the measurementsystem. Examples of continuous measurementsare time, temperature, weight and currency.

GLOSSARY

CONTROL CHART: A time-ordered plot of datapoints that includes a center-line (average value)and specific control limits; used to identifychanges in process performance.

CBR (Critical Business Requirement): A keymeasurable characteristic of a product or aprocess whose performance standards aredictated by process partners.

CCR (CRITICAL CUSTOMER REQUIREMENTS):A key measurable characteristic of a product ora process whose performance standards aredictated by the customer.

CUSTOMER: End user who pays green dollarsfor Caterpillar products and services

DASHBOARD: A display tool used to summarizekey process measurements that directly affectcustomer satisfaction.

DISCRETE DATA: Information expressed ona scale that has a finite number of values orcategories. Examples include location (Asia,Europe, US), credit source (A, B, C), andseason (winter, spring, summer, fall).

DMEDI: Data-driven methodology for designingproducts, processes and services. It iscomprised of five phases: Define, Measure,Explore, Develop and Implement.

DMAIC: Data-driven methodology for improvingprocesses, comprised of five phases: Define,Measure, Analyze, Improve and Control.

GLOSSARY

FMEA (FAILURE MODE AND EFFECTS ANALYSIS):A disciplined approach used to identify possiblefailures of a product or service and determinethe frequency and impact of the failure.Results of an FMEA are used to improve thesolution to a problem and develop contingencyplans in case of failures.

ENTERPRISE FOCUS: The ability to makesound business decisions by optimizing cashflow for the global Caterpillar organization.

GAGE R&R (GAGE REPEATABILITY ANDREPRODUCIBILITY): A statistical tool usedto measure the amount of variation in themeasurement system arising from the measurementdevice and the people taking the measurement.

GREEN BELT: An individual trained in theDMAIC and/or DMEDI methodology whosepart-time role is to work 6 Sigma projects.

HYPOTHESIS TESTS (t-TEST, F-TEST,ANOVA, CHI SQUARE): A set of statisticalanalysis tools used to determine whether theobserved differences between two or moresamples are due to random chance (as statedin the null hypothesis) or true differences in thesamples (as stated in the alternate hypothesis).

ISHIKAWA DIAGRAM: (Also called a “fishbone”)A tool used to organize possible causes for aspecific problem or effect by graphicallydisplaying them in increasing detail.

GLOSSARY

MASTER BLACK BELT (MBB): A full-timeexpert in the DMAIC and/or DMEDI and ProcessManagement methodology, specifically trainedto coach and mentor improvement teams anddedicated full time to 6 Sigma. The MBBparticipates in project reviews, helps the teamobtain required resources, provides training forBlack Belts and Green Belts, and ensures therigor of the DMAIC and/or DMEDI and ProcessManagement methodology is maintained.

MEAN: The average value of a data set.

MEASUREMENT SYSTEM ANALYSIS:A mathematical method of determining whatfraction of the total process variation observedis contained in the measurement (data collection)process.

MEDIAN: The middle or central value of a dataset whose values are arranged in increasingorder.

MISTAKE PROOFING: A technique foreliminating errors that cause defects by:• Predicting when an error could occur and

taking action to eliminate the possibility ofoccurrence, or

• Predicting when a defect is about to occurby detecting that an error has occurred andtaking the appropriate action.

MINITAB: Caterpillar’s current statisticalsoftware application of choice.

MOMENT OF TRUTH: Any instance in whichthe customer comes in contact with a productor service and can make a critical judgment onthe business - positive or negative.

GLOSSARY

MODE: The most frequently occurring value ina data set.

MULTI-GENERATIONAL PRODUCT/PROCESS PLAN(MGPP): Generations of aproduct or process used to reach a long-termvision. It contains concepts, platforms, andtechnologies needed for each stage.

NOISE: Those items that can affect the outputof the product/process, which the team cannotcontrol or chooses not to control.

NONVALUE-ADDED STEPS: Steps in theproduction and delivery of a product or servicethat are considered nonessential to meeting thecustomer’s needs and requirements (i.e., stepsthe customer would not be willing to pay for).

OPERATIONAL DEFINITION: A detaileddescription of a process, measurement oractivity written to ensure common understanding.

OPPORTUNITY: Any characteristic of a unitthat is inspected, measured, or tested andprovides a chance of not meeting a customerrequirement.

OUTLIER: A data point located beyond aspecific range and that represents a statisticallyunexpected event. Outliers may result from anunstable process, a specific process improvement,or a data collection or data entry error.

OUTPUT MEASURE: An indicator of processperformance captured at the end of a process,and links to the process’ ability to satisfy customerneeds and requirements.

GLOSSARY

PARETO CHART: A graphing tool that prioritizesa list of variables or factors based on impact orfrequency of occurrence. It is used to separatethe potential vital few causes of a particularproblem from the trivial many.

PERFORMANCE STANDARD: (Also calleda specification or Spec limit) A boundary thatdefines acceptable values for the measurementof a product or process as determined bycustomer needs. Depending upon the productor process, a performance standard may beone-sided (a single boundary) or two-sided(upper and lower boundaries).

PILOT: A test of a proposed solution on a smallscale in a real business environment to verifythat the improvement goal has been met andto identify issues that must be addressed toensure the successful full-scale implementationof the solution.

PROCESS: A series of steps that transformsone or more inputs into an output (product orservice) to meet a customer and/or processpartner’s need. Every activity performed, whetheror not it produces a tangible product, can bedescribed as a process.

PROCESS PARTNER: Internal customer whoprovides inputs or receives outputs of aninternal process.

PROCESS CAPABILITY: The ability of a processto produce a defect-free product or service.

PROCESS MANAGEMENT: The means bywhich we ensure the improved/createdoutcomes of 6 Sigma projects continue yearover year.

GLOSSARY

PROCESS MAP: An illustration of the steps,events, and operations (in chronological order)that make up a process.

PROCESS REVIEW: Required review facilitatedby the Process Owner after completion andclosure of a 6 Sigma project to ensure thatthe benefits are being sustained.

QUALITY FUNCTION DEPLOYMENT (QFD):(Also called House of Quality) A structuredmethodology used to identify customers’requirements and translate them into keyprocess deliverables.

RANDOM SAMPLE: Data collected in amanner such that each element of the populationhas an equal chance of being selected formeasurement. Random sampling helps to avoidbiases specific to the time and order of datacollection, operator or data collector.

REGRESSION ANALYSIS: A method ofanalysis that quantifies the relationship betweena response (Y) variable and one or morepredictors (Xs). The relationship is representedby a formula (the regression equation) that canbe used to model process performance.

REPLICATION: Replication of a processimprovement occurs when the processimprovement framework of a completed6 Sigma project is used as a guide for aseparate, but similar project. There mustbe a reasonable degree of uncertainty as towhether the proposed solution will work withoutsignificant modification. The elements of theDMAIC methodology will need to be completed,even if abbreviated somewhat.

GLOSSARY

ROBUST PROCESS: A process that operatesat 6 Sigma and is therefore resistant to defects.The critical process elements usually havebeen designed to prevent or eliminateopportunities for defects.

ROOT CAUSE: The underlying condition orfactor that produces one or more problemsor defects.

RUN CHART: A graphing tool that shows dataplotted in time order for a process. Patterns onthe run chart can help identify the presence ofspecial cause variation.

SAMPLING: The practice of gathering asubset of the total data available from a processor a population, to draw conclusions about apopulation or process; this is known asstatistical inference.

SCATTER PLOT: (Also called a scatter diagramor a scattergram) A graphing tool that showsthe relationship between two variables. The dotson the scatter plot represent data points.

SCORECARD: An evaluation tool (usually inthe form of a questionnaire) that is used by thecustomer to rate the business’ ability to satisfytheir key requirements.

SEGMENTATION: The division of a groupinto smaller, logical categories for analysis.Some commonly segmented entities arecustomers, data sets, or markets.

SIGMA (σ): The statistical term for the standarddeviation of a population. In 6 Sigma, Sigma isa measure of process performance based oncustomer requirements.

GLOSSARY

SIPOC: A high-level process map that showsSuppliers, Inputs, Process steps, Output andCustomers for a process.

STRATEGIC IMPROVEMENT PROJECT (SIP):Enterprise-wide project that supports our globalmission and critical success factors. Projectsare led by Black Belts using 6 Sigma methodologyand rigor to drive results supported by factsand data.

SPECIAL CAUSE VARIATION: (Also nonrandomvariation or controllable variation) Shifts inprocess output caused by a specific factor suchas environmental conditions or process inputparameters; special cause variation can bedirectly accounted for and potentially removed.

SPECIFICATION LIMIT: A threshold valueobtained from the customer that defines whetherthe performance of a product or process isacceptable.

STANDARD DEVIATION: The statistical“spread” of data in relation to the mean thatindicates variation in a data set.

STANDARDIZATION: Standardization ofa process improvement occurs when theimprovement is implemented, subsequent tothe completion of the original 6 Sigma project,broadly across business units or departmentswith little or no modification.

STATISTICAL PROCESS CONTROL (SPC):The application of statistical methods (usuallycontrol charts) to analyze and control thevariation of a process.

GLOSSARY

STRATIFYING FACTOR: (Also stratificationor stratifier) A process characteristic used todivide data into subgroups to look for changesin process performance that might indicate thefactor is a key driver of process performance.

TREE DIAGRAM: A graphing tool used tosubdivide a broad topic or goal into increasinglevels of detailed items; tree diagrams areuseful for organizing information into a logicalhierarchy.

UNIT: Any item that is produced or processed.

VALUE-ADDED STEPS: The steps in theproduction and delivery of a product or servicethat are essential to meeting customers’ needsand requirements. Since they bring the productor service closer to completion, value-addedsteps are considered steps the customer iswilling to pay for.

VARIATION: (Also noise) The fluctuation in aprocess measurement quantified by standarddeviation.

VITAL FEW: The small number of variables(Xs) most likely responsible for the majority ofthe variation in a process, product or service.

VOICE OF THE BUSINESS (VOB): Informationfrom process partners and business stakeholdersobtained from a variety of sources about theexpected and/or actual requirements related tothe performance of a product or process.

GLOSSARY

VOICE OF THE CUSTOMER (VOC):Information from customers obtained from avariety of sources about the expected and/oractual requirements related to the performanceof a product or process.

ZST: A statistical measure of process performancethat is the basis for determining processcapability (process sigma).

99.99966% 6.0 3.4 0.034 0.00034

99.9995% 5.9 5 0.05 0.0005

99.9992% 5.8 8 0.08 0.0008

99.9990% 5.7 10 0.10 0.001

99.9980% 5.6 20 0.2 0.002

99.9970% 5.5 30 0.3 0.003

99.9960% 5.4 40 0.4 0.004

99.9930% 5.3 70 0.7 0.007

99.9900% 5.2 100 1.0 0.001

99.9850% 5.1 150 1.5 0.015

99.9770% 5.0 230 2.3 0.023

99.9670% 4.9 330 3.3 0.033

99.9520% 4.8 480 4.8 0.048

99.9320% 4.7 680 6.8 0.068

99.9040% 4.6 960 9.6 0.096

99.8650% 4.5 1,350 13.5 0.135

99.8140% 4.4 1,860 18.6 0.186

99.7450% 4.3 2,550 25.5 0.255

99.6540% 4.2 3,460 34.6 0.346

99.5340% 4.1 4,660 46.6 0.466

99.3790% 4.0 6,210 62.1 0.621

99.1810% 3.9 8,190 81.9 0.819

98.930% 3.8 10,700 107 1.07

98.610% 3.7 13,900 139 1.39

98.220% 3.6 17,800 178 1.78

97.730% 3.5 22,700 227 2.27

97.130% 3.4 28,700 287 2.87

96.410% 3.3 35,900 359 3.59

95.540% 3.2 44,600 446 4.46

94.520% 3.1 54,800 548 5.48

93.320% 3.0 66,800 668 6.68

91.920% 2.9 80,800 808 8.08

90.320% 2.8 96,800 968 9.68

88.50% 2.7 115,000 1,150 11.5

86.50% 2.6 135,000 1,350 13.5

84.20% 2.5 158,000 1,580 15.8

81.60% 2.4 184,000 1,840 18.4

78.80% 2.3 212,000 2,120 21.2

75.80% 2.2 242,000 2,420 24.2

Long- Defects DefectsTerm

ProcessPer Per

Defects

YieldSigma

1,000,000 10,000Per 100

ABRIDGED SIGMA CONVERSION TABLE

ABRIDGED SIGMA CONVERSION TABLE

72.60% 2.1 274,000 2,740 27.4

69.20% 2.0 308,000 3,080 30.8

65.60% 1.9 344,000 3,440 34.4

61.80% 1.8 382,000 3,820 38.2

58.00% 1.7 420,000 4,200 42

54.00% 1.6 460,000 4,600 46

50% 1.5 500,000 5,000 50

46% 1.4 540,000 5,400 54

43% 1.3 570,000 5,700 57

39% 1.2 610,000 6,100 61

35% 1.1 650,000 6,500 65

31% 1.0 690,000 6,900 69

28% 0.9 720,000 7,200 72

25% 0.8 750,00 7,500 75

22% 0.7 780,000 7,800 78

19% 0.6 810,000 8,100 81

16% 0.5 840,000 8,400 84

14% 0.4 860,000 8,600 86

12% 0.3 880,000 8,800 88

10% 0.2 900,000 9,000

Long- Defects DefectsTerm

ProcessPer Per

Defects

YieldSigma

1,000,000 10,000Per 100

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