Supply Chain Vector [Electronic resources] : Methods for Linking the Execution of Global Business Models With Financial Performance نسخه متنی

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Supply Chain Vector [Electronic resources] : Methods for Linking the Execution of Global Business Models With Financial Performance - نسخه متنی

Daniel L. Gardner

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Process Variation and Functions

The math behind Six Sigma can get fairly complicated, but the best way to understand what drives process outcomes is to gain a conceptual understanding of functions. In its simplest mathematical format, Six Sigma can be boiled down to:

Y = f(x)

In prose form, the above is read as "Y is a function of x." In other words, when dealing with any type of process, the end result, or output (Y), depends on all of the inputs (x) that go into that process. In the Six Sigma vernacular, Y is referred to as a critical-to-quality characteristic, which is an attribute that clients desire in the products or services they purchase. The power of Six Sigma lies in its ability to be applied to any type of process in an organization. The common ground among all projects is that the goal is to reduce variation in the process being analyzed.

While TQM focused its variance reduction efforts on production environments, successful Six Sigma projects have been recorded in areas such as accounts payable, order fill rates and billing accuracy, among others. One of the attractive components of Six Sigma is that it allows teams to first prioritize the importance of potential projects and then use the same methodology to measure variation, regardless of the department or function. The way in which Six Sigma links cause-and-effect relationships with the standard deviation's method for measuring process variance is by using defects per million opportunities, or DPMO, as a baseline.

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