The quality improvement project at Tata Engineering operates
under the umbrella of the Tata Business Excellence Model,
an open-ended framework that drives business excellence
in group companies. But the main component of the quality
undertaking is Six Sigma, a disciplined, precise and widely
proven methodology that aims for near-flawless products
by Motorola in 1986, Six Sigma employs a range of strategies
and tools to eliminate defects in processes. Sigma, a
letter in the Greek alphabet, is used by statisticians
to denote the standard deviation of a process. To achieve
Six Sigma quality, a process must produce no more than
3.4 defects per million opportunities (an opportunity
is defined as a chance for non-conformance, or not meeting
the required specifications). The higher the number of
defects, the lower is your Sigma score.
were many Sigma defects that Tata Engineering had to eliminate
to get back on track. The weight of competition, ever-increasing
customer expectations and shifting market conditions made
change an absolute imperative. The companys older
vehicles were getting obsolescent, and its newer ones
were lagging behind in terms of customer satisfaction.
"We realised that to succeed we had to completely
reorient the companys thinking and the thinking
of our people," says
Atam P. Arya, Tata Engineerings senior vice president
overseeing the quality initiative. "We had to stop
treating quality as a burden and start accepting it as
the main purpose of our existence. Quality became, for
us, the strategy for survival and for winning."
important challenge for Tata Engineering was in changing
the mindset of its people. "Initially our people
were very sceptical; they thought this was some new fad
that would soon go away." To ensure it did not, the
company conducted a blanket communication and training
exercise across the organisation. This started at the
highest levels, with the leaders and managers, and then
percolated to the rest of the employees.
focus of the Six Sigma programme at Tata Engineering was,
and remains, the customer. The company took its products
and analysed what customers would want from them, and
the critical-to-quality (CTQ) characteristics they would
be looking for. For instance, a customer buying a truck
will consider whether it measures up in terms of load,
speed, fuel efficiency, operational smoothness, etc. These
are his CTQ characteristics.
long as a CTQ attribute can be defined, it can be incorporated
in the Six Sigma model. These attributes can then be linked
to the manufacturing parameters that must be achieved
under the Six Sigma process to meet a customers
expectations. Tata Engineering drew up a whole system
around this, the stated goal of which was: "To achieve
a major breakthrough and a sustainable quality improvement
in all our products and business processes."
"We began telling our people that quality had to,
primarily, connect with our customers," says Mr Arya.
"By improving quality, we reduced the cost of manufacturing:
less rejection, less rework, smoother process flows, less
time taken, etc." This has led to an increase in
productivity and decreases in costs, defects and wastage.
Consequently, customer satisfaction has registered a significant
not that the company did not have quality programmes earlier.
"It was there, but it wasnt quantified. It
was seen in black and white terms and we could not put
any values to it. There were many missing links between
our quality standards and what the customer wanted. Our
previous quality initiatives did not take in the whole.
The big picture was lost."
Sigmas spread is vast enough to take in the big
picture. Because it is more rigorous than percentage-based
applications where 90 per cent defect-free means
100,000 bad eggs in 1 million Six Sigma comes closest
to realising the ideal of perfection.
What Tata Engineering did initially was apply the Six
Sigma standard to its products, with the aim of recording
a clear and visible improvement in them through this method.
It set up a strong Six Sigma organisation and established
a robust audit and monitoring mechanism to ensure that
targets were met and sustained.
large number of teams were put in place to implement the
project. There was one at the apex level to oversee the
overall implementation and others at the companys
plants in Jamshedpur, Pune and Lucknow. A filtering procedure
was created to identify and isolate problems. Firstly,
the CTQ features at the aggregate level body, engine,
paint, gearbox, axle, etc were considered. Then
came the components, and after that the supplier-level
improvement processes followed: skill enhancement, process
mapping, cause-and-effect analysis, failure-mode-and-effect
analysis (which helps anticipate problems and puts pre-emptive
corrective measures in place) and more. Next in line were
product audits, process audits and independent audits,
which were later matched to customer needs. Coming under
the Six Sigma microscope were three process levels: manufacturing,
support services and plant support services.
manufacturing, we wanted the initial product delivered
to be superior (because first impressions are important),"
says Mr Arya. "Then came product performance norms
such as reliability and durability. We tracked our manufacturing
and delivery systems before we audited product performances
over a long-term period."
quick to show
The benefits of the Six Sigma project were quick to show.
A plant audit of internal improvement commenced in October
2000, a month after the quality initiative was launched.
The focus was on the chassis line, which was tracked on
a weekly and monthly basis. By March 2001 Tata Engineering
had secured an improvement of 82.5 per cent here.
quality improvement for the first year of the Six Sigma
project (September 2000 to August 2001) was 80 per cent.
Since then it has been between 65 to 75 per cent a year.
customer gratification is the biggest gain of the Six
Sigma initiative, but there are others. Dealer satisfaction,
for one. "Our dealers used to spend seven to eight
hours in pre-delivery inspection of each of our trucks.
We brought that down to 20 minutes. Earlier the dealer
had to check about 140 points in a truck; now he has to
examine only 30-odd points." Another is product performance,
which has meant decreases in failure rates and customer
where does the company go from here? "At present
our products and processes are mostly in the Three and
Four Sigma band, but by the end of 2003 we should be reaching
Five Sigma for the entire company. We are now working
on two different degrees of the project: involving a much
larger number of people, and involving people in the back
offices, support services, etc." Currently between
1,500 to 2,000 people are directly involved in the Six
Sigma project, but every Tata Engineering hand has been
touched to some extent by the programme.
companys intention is to reach the Sigma peak of
six in some priority areas by 2005. But its not
going to be easy. "From Five to Six Sigma is a steep
climb, but then you must consider that with this methodology
you can keep raising the bar. Six Sigmas potential
is limitless. You can extend the spread, the processes
and their coverage, and you can link it to your future
strategies. There really is no end to it." The road
ahead is clear.
is the first of the two articles on the turnaround at
Tata Engineering. The second, , looks at the success
of the companys cost-erosion initiatives. The writer
can be contacted at: