A case study: Application of Six Sigma methodology in a small and medium-sized manufacturing enterprise

Six Sigma within small and medium-sized enterprises (SMEs) is rapidly emerging as the new wave of change in Six Sigma. The purpose of this paper is to review the implications of applying Six Sigma methodology over the SMEs, taking a specific case of a bicycle chain manufacturing unit. The study could be a paradigm initiative towards high quality products and services at low cost for every SME. Based on the literature, this paper proposes a process flow chart to present a one-shot picture of the Six Sigma application in a bicycle chain manufacturing unit which falls in an SME environment. The methodology adopted is DMAIC methodology of Six Sigma, which had been mostly successful so far in large-scale industries. The methodology has been applied to reduce the bush rejection rate (bush is an important component of a cycle chain) by reducing defects inherent in the processes. The statistical techniques such as two sample t-test and process capability analysis have been used to establish the process capability before and after the Six Sigma application. This paper is an attempt to justify the highly useful role of quality management techniques like Six Sigma for SMEs which are normally presumed to be in the domain of large industries. In this paper, Six Sigma methodology has been applied to a small unit manufacturing bicycles chains with dwindling productivity levels. After applying Six Sigma it was found that the chain manufacturing firm can increase its profit by controlling high rejection rate of cycle chain bush. Application of Six Sigma project recommendation brought up the process sigma level to 5.46 from 1.40 by reduction in bush diameter variation in the process of bicycle chain bush manufacturing. This increase in sigma level is equivalent to monetary saving of Rs 0.288 million per annum, which is a noteworthy figure for an industry of such level. The success of this study paves the way to further extend the Six Sigma application to more such industries working in the SME environment. This paper provides documented evidence of Six Sigma implementation in a bicycle chain manufacturing unit which has been taken as representative of a small and medium-size industry. The study will yield a great value to academics, consultants, researchers and practitioners of Six Sigma. © 2012, MCB UP Limited