 Hello and welcome to this session in which we will discuss six Sigma Six Sigma is a process improvement that was developed by a company called Motorola in the mid-80s and the person that coined The concept or the father of this concept is Bill Smith That's him and he was working on pagers the de facto rate for producing the dose pagers was high And he decided to do something about this So it's a data-driven approach to eliminate defects. That's what Bill wanted to do They were producing pagers and many of them were defective Reduce variation and processes ultimately lead to what improved quality. That's the key and efficiency So the name six Sigma refer to the goal of achieving a process performance level There is six standard deviation away from the mean of the process output Simply put you want to produce as many units as possible. We are while a limb almost eliminating You have to be six DVA six standard deviation from the meat. So what does that mean? So if you are producing the corresponding to a de facto rate no more than 3.4 parts per million. So if you are producing a million What's acceptable is only three four 3.4 parts per million. That's acceptable So to understand this concept just kind of again work with numbers. Let's assume a company is producing 1,000 units per day. Well, if the de facto rate is 3.4 Per million this means only three four three point four units out of every one million units Produced are defective. It means the majority of the remainder are Good not defective. So this is incredibly high standard and requires a level of precision and control That's not achievable through traditional quality control methods basically going crazy on six Sigma Let's take a look at an example. How does it work step by step before we proceed any further? I have a public announcement about my company farhat lectures comm Farhat accounting lectures is a supplemental educational tool That's gonna help you with your CPA exam preparation as well as your accounting courses My CPA material is aligned with your CPA review course such as Becker Roger Wiley gleam miles my accounting courses are aligned with your accounting courses Broken down by chapter and topics. My resources consist of Lectures multiple choice questions through false questions as well as exercises. Go ahead start your free trial today No obligation no credit card required So the six Sigma methodology Requires several steps. The first step is obviously to define the problem. What are we dealing with? So let's assume we are dealing with the defective rate. We have a high defective rate next measure the current performance Well, we have 3d facts per 10,000 unit. This is what we have right now Well, the next analyze the problem analyze the data to identify the root causes. Why? Why are we having 3d facts per 10,000 unit? Well, let's assume we identified its machine Calibration the machines need to be calibrated better. Well, improve the process by implementing solution now We're gonna calibrate the machine Then we're gonna go through a controlling process to ensure that the environment are sustained making sure it's working Making sure that the defective defective rate went down the defect rate went down So you have to understand six Sigma can be used in many industries Manufacturing healthcare finance to improve processes reduce costs and enhance enhance customer satisfaction It required special training special certification program And it has become a quality standard for quality management in many organizations So achieving six Sigma if you have six Sigma, it's not an easy feat. It's not an easy Goal and require significant effort and resources of a company is six Sigma. That's a great six Sigma certified Or they follow the six Sigma. It means they take quality extremely Extremely Seriously, what should you do now go to Farhat lectures? Whether you are studying for your CPA CMA accounting students or some other professional organization to learn more About these philosophies. Good luck study hard and of course stay safe You