144484798 handout lean six sigma ppt
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Lean Six Sigma
Tom Devane
Nexus U
2008
-- A Deeper Dive --
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Session Objectives
In this session you will learn
How to address organizational performance issues through
Lean Six Sigma The fundamentals of Lean Six Sigma and some key tools
What other organizations have learned through compiled
lessons learned analyses
How to get started, even if youre not the CEO
Some Lean Six Sigma considerations for your upcoming
Sunday Design Experience.
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Agenda
Topics
1. Introduction2. Lean Six Sigma Primer
3. Case Study 1
4. Case Study 2
5. Pre-thinking for Sundays Design
Experience
6. Wrap-up
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1. Introduction
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Audience inputs to the agenda
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Whaddaya Think?
1. The Toyota Production System -- a formidable competitive weapon by Toyota --consists of both Lean and Six Sigma principles and tools.
2. Six Sigma tends to get faster business results than Lean.
3. General Electric, well-known for its Six Sigma program, does not do any Lean.
4. The Just-In-Time process improvement craze of the 1980s was actually acombination of Lean and Six Sigma.
5. Lean and Six Sigma are used best in a manufacturing environment, not in a serviceenvironment.
6. Lean and Six Sigma both share the common goal of improved operationalperformance, they merely go about it in different ways.
7. Jack Welch of General Electric fame first improved processes with Six Sigma, then
modified the corporate culture to make Six Sigma results sustainable.
8. The average weight of a Lean practitioner is 22 pounds less then his Six Sigmacounterpart.
9. Purist Lean and purist Six Sigma practitioners are often at odds with each other incompanies that have been doing serious process improvement for 10 years or so.
10. The learning curve for Lean tends to be greater than the learning curve for Six Sigma.
At this point its not expected that you know anything about disciplines of Lean, Six Sigma, or their combined method. But you musthave heard something, so get with a partner and take a shot at the T/F questions below, and then well discuss in a learning environment.
T F
T F
T F
T F
T F
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T F
T F
T F
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2. Lean Six Sigma Primer
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Discipline Overview
Lean
Lean Six Sigma
Six Sigma
Eliminate waste.Simple tools like VSM, 5s.
Quick results.Can be dramatic
Reduce variation.Advanced tools like FMEA,
DOE, control charts.Dramatic results.
Benefits of Leanand Six Sigma.
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Which steps are waste in a Lean
environment?1. Move required production materials to the work station.
2. Insert lenses into sunglasses frame.
3. Move filled frames to next work station.
4. Check lenses for proper alignment within frame.5. Paint frames.
6. Scrape excess paint from lenses.
7. Move sunglasses to warehouse staging area.
8. When ready to ship, move sunglasses to packing area.
9. Pack sunglasses in box.
10. Perform final inspection on 1 of every 40 pairs of sunglasses.
11. Ship sunglasses.
12. Notify material planning personnel to order more frames and lenses.
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Value Stream Maps
Visualize all actions required (both value added and non-value added)
required to produce and distribute a product.
Identify sources of waste.
Entire process defined using a common language.
Manage flow through the process.
Show linkage between material and information flow.
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Companyconfidential
Companyconfidential
Companyconfidential
Companyconfidential
Companyconfidential
Orientation meeting Loan application Title search Ag econ eval/cons Account setup
HQ
Farmer
Loan Approval & Setup
Value Stream Map -- Current State
I
I I I I I
Pyt processing
I
(Staggered Receipt ofRecords)
Manual Archiving
LOAN CUSTOMER
Branch Manager
KEYElectronic
Communication
ManualCommunication
Supplier orCustomer
Delivery/Shipment
I Inventory
Push
Pull
25 Batches
Companyconfidential
Operators4Q03
Companyconfidential
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C/T = 7 days
C/O = 21 hours
L/T = 1 day (per lot)
AWT = 20 hours
# Op = 2 people
3 Sterile Batches
Step D
3 Sterile Batches
hold time = 1.5hrs (20 hrs max)
I C/T = 7 daysC/O = 6 hours
L/T = 3 day (per lot)
AWT = 2 hours
# Op = 2 people
3 Sterile Batches
Step E
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Which process is a better
process in Six Sigma?
AverageCandy barProductioncosts forchocolatebar
$5
$3
Process A
Process B
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Who is a better shot?
A B
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Key Six Sigma Tool
Control Chart
Anatomy of a Control Chart
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Players
Player Roles & Responsibilities Typical Training Six Sigma Dedication
Black Belt Works with a teamusually of Green Belts and people with no LSS training -- assigned to
a specific LSS improvement project. Black Belts help with both the technical aspects (e.g.,
statistical tools) and people issues (e.g., team dynamics and change management).
Typically a Black Belt will deliver about $1 million to the bottom line annually.
4 weeks of training
spread over 4 months
Full-time
(18 to 24mo)
Master Black Belt Acts as instructor, coach and mentor to several Black Belts. Frequently Master Black Belts
(MBBs) become involved in large-scale organizational change efforts and promotion of
LSS within the organization. In many organizations MBBs organize into a learning group
in which they challenge, advise, and support each other and Black Belts. They also often
formulate business strategies with top management. In addition they may also lead super-
projects that are high impact staffed with multiple Black Belts.
Usually on the job Full-time
Green Belt Participates in LSS by collecting data, providing process expertise, completing
improvement tasks, and communicating changes to colleagues.
3 sessions of 3-4 days Part-time, as project needs
dictate
Champion (Executive) Provides business guidance to teams, assists in selecting projects, acts as an organizational
evangelist for Six Sigma, allocates resources, questions the team, anticipates and prevents
problems with the LSS before they occur, removes roadblocks if they do occur.
5 days Part-time,
as active executive sponsorship
needs dictate
ExecutiveSponsor
Actively supports and encourages project teams, participates in LSS meetings,demonstrations, and celebrations.
1-2 days Part-time,as executive support needs
dictate
Process Owner Ensures high quality design and peak performance of business processes. Helps triage
problems as those addressable by simple process improvement methods or problems
requiring use of complex, lesser-known statistical tools.
1 week Half-time to full-time,
depending on process size
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Who you gonna call?
1. The Purchasing analyst cannot spend as much time on the cross-departmental New Product Launch process because her functionalmanager has put her on a crunch project in Purchasing. This willlikely cause a 4-week slip in the launch of the next product.
2. Data needs to be collected on the number of failures of yourcompanys new electric razor once it gets into a customers hands.
3. The process improvement project will now be delayed 5 monthsbecause the engineer on the project has been sent on an overseasassignment.
4. Some heavy statistical analysis and design of experiments need to bedone for the new bioreactor in the South building because its yields areerratic, and averaging only 35%.
5. Several Black Belts are working on similar problems in different partsof the company, but they are not benefiting from each othersexperience like they could.
6. Decide that it would be great if the CEO could mention Lean SixSigma in each of her company-wide addresses over the next twomonths.
Black Belt
Master Black Belt
Green Belt
Champion
Executive Sponsor
Process owner
Draw a line to connect the issue with the person you would most likely call to address it.
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A peek into the practical world of Black BeltsCommon BB Challenges by Category
BB stretchedtoo thinly
Team membersstretchedtoo thinly
Assigned project will notsupport strategy well
Assigned project willhave little return
Entire targeted population for the
improvements not on improvementteam, and resist
Motivating teamto perform and
improve
Middle manager seeks toblock project in his/her
area
General poor supportfrom Champion
Pressure for quickresults from topmanagement
Black Belts indifferent parts of theorganization make
the same mistakes
Team wants to jump aheadto fixes w/o dataTeam wont assume ownership
quickly enough backsliding,etc.
Poor team dynamicshinder progress
Powerful execs in other areasblock implementation and
Champion wimps out
Powerful functionalmanager attempts to
influence solution
Middle manager wants petproject funded
Change management
Post-launchdiscoveries
Politics
Team problems
Team interfaceswith others
Resourcingissues
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Sigmalevel
Percentage of time
customersrequirements were
met
Defects per
millionopportunities
1 68.27 690,000
2 95.45 308,537
3 99.73 66,807
4 99.9937 6,210
5 99.999943 233
6 99.9999998 3.4
Whats the Sigma Thing anyway?
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The voice of the customer and CTQ
Operational definition
DMAIC
DOE
FMEA
Value Stream Mapping
5s
Tampering
Key terms and concepts
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What its not
In helping to define what Lean Six Sigma is, it is also helpful to consider what it is not:
It is not just a collection of tools that people can be trained in and shortly thereafter deliver
outstanding results. Successful LSS efforts require strong management support, training, and formal
ties to the organizations management system.
It is not just a statistics program. It is a results program.
It is not a recycled Total Quality Management program from the 1970s. While many tools and some
methods from the quality movement are present in LSS, it distinguishes itself by having formal links
to the compensation system, financial screening of potential projects, and a fanatical emphasis on
the needs of the external customer.
It is not a training program, as many Total Quality Management programs became. It is a system of
tools, principles, and management practices that are applied to a improve processes.
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3. Case Study 1
Biopharmaceutical division
of a global pharma company
P f F k
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Strategy
Process
Information
& LearningCulture
Structure &
Relationships
Energizing Core
Want Know
to how
Pay
for
HR
Practices
Performance Framework
2003. Jossey-Bass and Tom Devane fromIntegrating Lean Six Sigma and High-Performance Organizations. All rights reserved.
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Hit performance issues on
multiple fronts
Lean training for all managers and supervisors
Basic Six Sigma training for all managers and supervisors
Center of Excellence leaderslocated in all departments -- trained in
advanced Six Sigma methods and philosophy
Leadership development occurred simultaneously to address critical
change management issues within, and among departments
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Operating Results
Representative issues addressed
Batch review cycle time reduced by 60%
Operational metrics track 12 parameters, improvements in 9 so far
Yields improved by 20% in one production area by using statisticaltools
Approach to addressing the issues and results
All work was done via chartered, cross-functional teams
DMAIC (Define, Measure, Analyze, Improve, Control)
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The 10 Big pay attention to elements
for LSS leaders
1. The use of data and factsnot just opinions -- to make decisions.
2. Managing variation in processes, instead of just managing reject levels for a product.
3. An awareness of, and management of business processes and value streams that cut acrossfunctional department boundaries.
4. Opportunities to pull work through operations rather than push them.
5. An emphasis on prevention, not reaction.
6. Processes and culture that foster the continual search for ways to streamline and eliminate waste.
7. Impacts of activities and solutions on customer requirements.
8. Checks and balances to ensure that LSS experts do not become overloaded and leave.
9. Workplace orderliness and cleanliness.
10. Links between LSS improvement efforts and the organizations reward and recognition system.
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4. Case Study 2
High-Tech Electronics Assembly
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Background
Key challenges
High rate of field failures needed to be addressed in order to compete and be profitable
Lack of consistency within our products as a whole based on different services
Different processes created unnecessary confusion and significant difficulties when it was time to transfer
products into large volume production Absence of motivation for continuous improvement outside the internal total quality group
Goals among different departments were not aligned and people were working on redundant, and in some casescounter-productive projects
Many of the employees had come up through the scientific ranks and were accustomed to working alone, noton teams.
Results
Successfully integrated Lean, Six Sigma, and High Performance Organization disciplines
Operating results:
$400,000 repeating annual savings within 2 months
Productivity increase of 2x within 7 months
Established a culture that drove for execution and continual improvement
Identified key areas for upstream new product development that later saved the company over $1 millionannually
Value-Added Process Time/Total Process Time went from 8% to 60% for two key processes within thefirst 2 months
Executives played a key role in the initial success
Hard/soft integration principles deployed.
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Discipline Overview
Lean
Lean Six Sigma
Six Sigma
Eliminate waste.Simple tools like VSM, 5s.
Quick results.
Reduce variation.Advanced tools like FMEA,
DOE, control charts.Dramatic results.
Benefits of Leanand Six Sigma.
High-Performance
Organizations
LSS/HPO
Culture of execution & improvement.Restructure into HPTs.
Intrinsic motivation for short- and long-term sustainable gains.
Benefits of Lean,Six Sigma, and
High-PerformanceOrganizations.
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Journey
Challenges articulated
Study group convenes
Develop direction
Research results
New leadershiptraining
Announcements
Customer requirements
Process mapping
Teamstructuringworkshop
Projects Remedial
coaching
Continuous
improvement
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Hallmarks of the discipline
1. Statistical methods
2. Attention to workplace and tool organization
3. Fanatical focus on the external customer
4. Attention to process5. Pre-screening, and ongoing screening of improvement projects to ensure fit with strategy and
financial return
6. People strive for perfection, but noble mistakes are tolerated
7. An analysis-rich and measurement-rich environment
8. A classification and sorting process to determine the type of tools to apply9. Coordination and control of the work occurs at the lowest level possible
10. Collective accountability
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5. Pre-Thinking for your Sunday
Design Experience
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Sunday pre-thought
What would a Lean Six Sigma foundation building block look like?
How would it be described?
What other methods might enhance Lean Six Sigma?
What other methods might Lean Six Sigma enhance?
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6. Wrap-up
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Lessons Learned
Planning
Being realistic is quite helpful
Ensuring wide participation in the planning processes
Missing the customer perspective early on will kill you
Need to document planning phase well Assign responsibilities clearly
Integration of hard and soft aspects is keyeach covers inherent weaknesses of the other
No organization-wide roll-outs of Six Sigma without training senior managers how to support ittopmanagement dialogue cant stop after the approval and initial re-organization into teams.
Resist the temptation to use good -- notgreat-- performers as driving change agents, such as BlackBelts.
Go for lean manufacturing techniques before Six Sigma to demonstrate quick wins unless data foranalysis already exists (as it did for a field service warranty process)
Strive to over -communicate and request feedback on the content and quality of communication.
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Lessons Learned
Implementation
Maintain flexibility in the planning that other options can be considered as you move forward.
You can generally do more than most people think.
Ensure responsibilities are clearly assigned.
Ensure leaders of change are optimistic and will push project through to completion.
Groom the subsequent leaders
The restructuring into teams -- this can notbe a pilot.
Executives need to agree on their individual and collective areas of responsibility for business processes.
Design structures and processes that ensure control.
Training for new leaders needs to mandatory, not optional
Bring Finance and HR into the process soon.
Executive efforts can decrease as the transformation progresses if the soft elements of HPO are successfully anchored.
It is extremely important to provide frequent status reports for the improvement projects.
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Sounds great. But how do I
get something going with Lean
Six Sigma if Im not the CEO?
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For Future Reference
Breyfogle, Forrest. Implementing Six Sigma: Smarter Solutions Using Statistical Methods. New York:Wiley-Interscience, 1999.
Devane, T.Integrating Lean Six Sigma and High Performance Organizations:Leading the ChargeToward Rapid, Radical, Sustainable Improvement.. San Francisco: Jossey-Bass/Pfeiffer, (currentworking title, forthcoming in November, 2003).
Holman, P., Devane, T., & Cady, S., The Change Handbook. San Francisco: Berrett-Koehler, 2007.
Macy, B.A., and Izumi, H.A. Organizational Change, Design and Work Innovation: A Meta-Analysisof 131 North American Field Studies1961-1991, inResearch in Organizational Change andDevelopment. R. Woodman and W. Pasmore (eds). New York: JAI Press Inc, Vol 7.
Nauman, E. & Hoisington S. Customer Centered Six Sigma: Linking Customers, Process Improvement,and Financial Results. Houston: American Society for Quality, 2001.
Pande, Peter, et al. The Six Sigma Way. New York: McGraw-Hill, 2000.
Rother, M., and Shook, J. Learning to See: Value Stream Mapping to Create Value and EliminateMuda. Brookline, MA: Lean Enterprise Institute, 1989.
Womack, J. and Jones, T. (1996). Lean thinking: Banish waste and create wealth in your corporation.New York: Simon & Schuster.
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Web resource: www.isixsigma.com
http://www.isixsigma.com/http://www.isixsigma.com/