Page 116 - Six Sigma Demystified

Chapter 5 m e a s u r e s tag e 97

The cost of quality tends to increase as errors in a product or service move
downstream. It bears repeating that if it costs $1 to fix a problem in the design
of the product or service, it costs $10 to fix it in manufacturing or service deliv-
ery and $100 after delivery to the customer. Consider the costs owing to faulty
tires, food poisoning, or software bugs. The sooner problems are detected and
resolved, the cheaper is the solution.
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In this way, failures are ow- hanging fruit, providing a quick return on invest-
ment (ROI). Understanding the causal systems leads to improvement in efforts
at appraisal and, eventually, prevention.
While financial metrics such as cost of quality are useful for identifying areas
of potential improvements and tracking project savings, there is too much lag
in their response to identify process changes requiring action. Instead, CTC or
CTS metrics are defined that contribute to cost yet are quick to respond to
changes in process conditions.
A review of the potential savings and benefits outlined in the “Project Selec-
tion” section in Chapter 3 helps to quantify the costs captured by the response
of the particular metric.

ctS metrics
The most often used metric for CTS issues is the cycle time metric or some
derivation of cycle time such as order processing time, delivery time, queue
time, or downtime. As with costs, problems in quality also can affect the sched-
ule. For this reason, process improvement focused on CTQ metrics also may
improve CTS issues. Consider the delays associated with rework or the repro-
cessing of orders after mistakes in a quality parameter have been detected.
Preventing the errors by concentrating on the CTQ metrics results in improved
CTS response.
In addition to these quality- related issues, there are many other opportuni-
ties for improvement in cycle times. In the analyze stage, lean value- stream
analysis provides techniques for differentiating between value- added and
non- value- added process steps. Process efficiency and velocity can be calculated,
each of which indicates a process’s relative value- added cycle time. While these
metrics are useful for comparing processes or for comparing before- mprovement
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and after- mprovement states of the process, they are not as useful as tracking
metrics for identifying changes in process conditions. Calculated values tend to
dampen the signal of a cycle time change and be less intuitive to process per-
sonnel who must respond to changes, decreasing their value as metrics for
immediate information.