Commodities products like soaps, detergents, potato chips etc. faces lot of cost pressure. Manufacturer has to ensure right quantity of the product in each pack to ensure his margins (by avoiding packing more quantity) and avoids legal issues from consumer forum (in case if less quantity is found in the pack).
Let’s take this example
A company is in the business of making soaps with a specification of 50-55 Gms/cake. Anything less than 50 Gms may invite litigation from consumer forum and anything beyond 55 Gms would hit their bottom line. They started the manufacturing and found huge variation in the mean weight of the cakes week after week (see figure-1, January-February period). They were taking one batch per week and producing 250000 soap cakes per batch. From each batch they draw a random samples of 100 soaps for weight analysis. Average weight of 100 samples drawn per batch for the month of Jan-Feb is given below.
In order to evaluate the performance of the process, a control chart is plotted with VOP & VOC (see below). Presently it represents the case-I scenario, Figure-6 where VOP is beyond VOC.
They started continuous improvement program to reduce the variability in the process using DMAIC process. They were able to reduce the variability to some extent but still majority of the soap cakes were out of specifications (March-April period, Figure-3). They continued their endeavor and reduced the variability further and for the first time the control limits of the process was within the specification limits (May-June period, Figure-3). At this point their failure rates were reduced as 95% of the soaps would be meeting the specifications.
We can further reduce the variability to reach the 6 sigma level where the failure rates would be 3.4ppm. But now, we need do a cost benefit analysis as improvement beyond a limit would involve investment. If 5% failure rate is acceptable to the management then we would stop here.
It is not always desirable to achieve 6 sigma level, a 3 sigma process is good enough. But there are cases where human life is involved like passenger aircraft, automobile brakes and airbags, medical devices etc. and in these cases it worth going to 6 sigma and beyond to ensure the safety of the human life.