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0,1 1 10 100 0 1 2 3 4 5 6 OVERALL SIGMA PERCENT OF REVENUES In most companies COPQ runs at about 20 to 40 percent of sales. J.M. Juran 1988 Cost Of Poor Quality Traditional Quality Costs Customer Returns Inspection Costs Recalls Waste Rejects Rework Testing Costs 2-3% Cost Of Poor Quality Customer Returns Inspection Costs Recalls Waste Rejects Rework Testing Costs Customer Allowances Incorrectly Completed Sales Order Excess Inventory Incorrect orders shipped Time with Dissatisfied Customer Late Paperwork Excessive Overtime Premium Freight Costs Excessive Field Service Costs Pricing or Billing Errors Complaint Handling Overdue Receivables Employee Turnover Expediting Costs Planning Delays Development Cost of Failed Products 20-40% Unused Capacity Lost goodwill Delays Six Sigma Deployment Executive Management Black Belts Yellow Belts Six Sigma Champion Master Black Belts Vision Prioritize Define projects Support Teach Measure Analyze Improve Control Communication Coordination Key Roles Executive Management Set goals Establish infrastructure Select projects and teams Support projects and monitor progress Asking the right questions Six Sigma Champion Understand the use of Six Sigma tools Supports and coaches Black Belts Reviews projects Developes strategies to drive down costs and increase profitability Master Black Belt Trains and coaches Black Belts Provides consulting assistance to Champions and Executive Management Key Roles #2 Black Belts Develop, implement, and sustain process improvements Stimulate thinking by posing new ways of doing things Challenge conventional wisdom Seek out and pilot new tools Create innovative strategies Develop others to follow in their footsteps Yellow Belts Fundamental Six Sigma concepts Statistical literacy, basic statistics, process control Team skills Top management attention is a must Follow some rigorous system religiously Measure cost of poor quality and post visible Reward good results Train everyone Use a team-ba
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