by:by:

Nayef S. Al-UtaibiNayef S. Al-Utaibi

Abqaiq PlantsAbqaiq Plants

Abqaiq Plants Experience in Implementing

Lean Six Sigma

Abqaiq Plants Experience in Implementing

Lean Six Sigma

2

Abqaiq Plants Initiated the Abqaiq Plants Initiated the in-house in-house Lean Six Sigma Projects in 2005Lean Six Sigma Projects in 2005

Lean Six Sigma Training was Provided by Lean Six Sigma Training was Provided by OCDOCD

IntroductionIntroduction

3

Lean Six SigmaLean Six Sigma is is a data-driven business process optimization methodology which aims to reduce variation, eliminate non-value added activities, and significantly improve process quality.

11stst Introduced by Motorola in 1980’s Introduced by Motorola in 1980’s

BackgroundBackground

4

BackgroundBackground

Total Quality Management

Process Reengineering

L/I

Ca

nce

lla

tio

n F

req

.

Pe

rce

nt

C1

Count 59 48Percent 28.8 13.4 12.3 9.6 9.2 6.8 5.8

3455.3 4.9 4.0

Cum % 28.8 42.2 54.5 64.1 73.3 80.1

161

85.8 91.1 96.0 100.0

148 115 110 82 69 63

1200

1000

800

600

400

200

0

100

80

60

40

20

0

MTL. TYPE VS L/ I CANCELLATION

L/I

Ca

nce

lla

tio

n F

req

.

Pe

rce

nt

C1

Count 59 48Percent 28.8 13.4 12.3 9.6 9.2 6.8 5.8

3455.3 4.9 4.0

Cum % 28.8 42.2 54.5 64.1 73.3 80.1

161

85.8 91.1 96.0 100.0

148 115 110 82 69 63

1200

1000

800

600

400

200

0

100

80

60

40

20

0

MTL. TYPE VS L/ I CANCELLATION

806040200

Median

Mean

181614121086

Anderson-Darling Normality Test

Variance 292.149

Skewness 3.1333Kurtosis 11.2609N 50

Minimum 0.000

A-Squared

1st Quartile 5.000Median 9.000

3rd Quartile 15.000Maximum 94.000

95% Confidence Interval for Mean

9.022

5.78

18.738

95% Confidence Interval for Median

7.000 12.000

95% Confidence Interval for StDev

14.278 21.299

P-Value < 0.005

Mean 13.880StDev 17.092

95% Confidence Intervals

Summary for Cancelled Line Item during 2001

806040200

Median

Mean

181614121086

Anderson-Darling Normality Test

Variance 292.149

Skewness 3.1333Kurtosis 11.2609N 50

Minimum 0.000

A-Squared

1st Quartile 5.000Median 9.000

3rd Quartile 15.000Maximum 94.000

95% Confidence Interval for Mean

9.022

5.78

18.738

95% Confidence Interval for Median

7.000 12.000

95% Confidence Interval for StDev

14.278 21.299

P-Value < 0.005

Mean 13.880StDev 17.092

95% Confidence Intervals

Summary for Cancelled Line Item during 2001

LeanLeanSix SigmaSix SigmaProcessProcess

5

Transform PerformanceTransform Performance

Support Local Economy

Support Local Economy

Optimize PortfolioOptimize Portfolio

Utilize Risk ManagementUtilize Risk

Management

Achieve Highest

Standards of Safety & Env.

Achieve Highest

Standards of Safety & Env.

Deploy Technology &

Encourage Innovation

Deploy Technology &

Encourage Innovation

Support Saudized

Contractors

Support Saudized

Contractors

Perform Only Value-Added Core Services

Perform Only Value-Added Core Services

Reduce Cost & Enhance Revenue

Reduce Cost & Enhance Revenue

Envision Future Jobs RequirementEnvision Future

Jobs Requirement

Deploy Knowledge

Management

Deploy Knowledge

Management

Abqaiq Plants Strategy MapAbqaiq Plants Strategy MapF

ina

nci

al

Pe

rsp

ect

ive

Cu

sto

me

rP

ers

pe

ctiv

eL

ea

rnin

g

Pe

rsp

ect

ive

Inte

rna

l pro

cess

Pe

rsp

ect

ive

Achieve Optimum Quality & Reliability

Achieve Optimum Quality & Reliability

Enhance Empowerment & Accountability

Enhance Empowerment & Accountability

Enhance Workforce

Competency & Create Learning

Environment

Enhance Workforce

Competency & Create Learning

Environment

Risk & Reliability Risk & Reliability ManagementManagement

Enhance Efficiency of

Core Processes

Enhance Efficiency of

Core Processes

BIC Focus AreasBIC Focus Areas

Lean Six Sigma Lean Six Sigma MethodologyMethodology

Minimize Minor Maint. WO Labor Cost

Improve T&I Planning Effectiveness

6

DEFINEDEFINE

ANALYZEANALYZE

CONTROLCONTROL

IMPROVEIMPROVE

MEASUREMEASUREMinimize Minor Maint. WO Labor Cost

Improve T&I Planning Effectiveness

7

Project DefinitionProject DefinitionMinimize MM WO Labor Cost

ObjectiveObjective• Reduce Minor Maint. Work

Order cost by 30%

Defect DefinitionDefect Definition• Variation of MMWO Cost• Actual MMWO cost exceeds

planned cost

BenefitsBenefits• Annual Saving of $263M• Reduce the overall

Department backlog• Optimize the Department

resources deployment

8

Project DefinitionProject DefinitionMinimize MM WO Labor Cost

Process SponsorProcess Sponsor• Manager, APMD

Project ChampionProject Champion• Superintendent, MSD

Master Black BeltMaster Black Belt• KURT ROBERTSON

Black BeltBlack Belt• N.S. AL-UTAIBI

Team MembersTeam Members• G.M. AL-Ghamdi• Y. Al-Rashid• A Al-Mousawi• Y. Al-Sarouj

9

Data MeasurementData Measurement

Lower Specification Limit

Upper Specification Limit

Histogram Plot

0$ 500$

No.

of M

inor

Mai

nt. W

Os

10

Data AnalysisData Analysis

Data Distribution Plot

2004

Labo

r Cos

t

2002 2003

11

Data AnalysisData Analysis

Scattered Plot

Variation is a Variation is a direct function of direct function of

planningplanning

Unit 1

Unit 2

Unit 3

Unit 4

Ac

tua

l Min

or

Ma

inte

na

nc

e C

ost

Planned Minor Maint. Cost

MMWO

Linear Relation

12

Data AnalysisData Analysis

Measurement Material

Environment

Personnel

MachineMethod

Scheduling

What causes

the variation

in labor cost?

Wrong planning

Eq. unavailability

Time sheet

Wrong Material

Over-reacting

Duplication

Overcharging

Craft unavailability

Bad whether

Fishbone Diagram

13

Data AnalysisData Analysis

Process Step Potential Failure Mode

Potential Effects

Severity Potential Cause Occurrence Current Control

Detection Initial RPN

MMT Initiation Incorrect Duplication

7 Improver Turnover 10 Minor Check 6 420

7 No Pre-check in SAP

9 Rare 7 441

MMT Planning Inaccurate

Under Estimate 3 No clear job description

7 Reviewed by Planner

6 126

Over Estimate 7 No Clear Job Description

9 Reviewed by Planner

8 504

8 No Experience 6 None 8 384

MMWO Assignment

Incorrect Job Delay 6 Incorrect Ticket Title

7 None 8 336

Work Execution Delay Increase of MMWO

5 Crafts Unavailability

7 None 5 175

Timesheet Filling & Approving

Inaccurate Overcharging 9 Bad Scheduling 10 Rare 9 810

Failure Mode & Effect Analysis (FMEA)

14

Process ImprovementProcess Improvement

Start Create Notification

Create Notification

Stage Materials

Stage Materials Assign work

to Labor

Assign workto Labor

Print & handMMWO toCraftsman

Print & handMMWO toCraftsman

Approve Not.History

Approve Not.History

End

Reserve 9CAT Materials

Reserve 9CAT Materials

CreateMMWO

CreateMMWO

Fill & Appr.Time Sheet

Fill & Appr.Time Sheet Confirm work

completion

Confirm workcompletion

Tech. comp.MMWO

Tech. comp.MMWO

BusinessComplete

MMWO

BusinessComplete

MMWO

Create MMT

Create MMT Release &

Save MMT

Release &Save MMT Plan MMT

Plan MMT

Rank/ScheduleMMWO

Rank/ScheduleMMWO

Picklist/IssueMaterials

Picklist/IssueMaterials

Execute theWork

Execute theWork Enter

History

EnterHistory

Accept Work &

Close Not.

Accept Work &

Close Not.

Settle MMWO

Cost

Settle MMWO

Cost

15

Process ImprovementProcess Improvement

Enter History

Enter History

Settle MMWO

Cost

Settle MMWO

Cost

Fill & Appr.Time Sheet

Fill & Appr.Time Sheet

Accept Work&

Close Not.

Accept Work&

Close Not.Tech. comp.

MMWO

Tech. comp.MMWO

BusinessComplete

MMWO

BusinessComplete

MMWO

Create MMT

Create MMT Release &

Save MMT

Release &Save MMT Plan MMT

Plan MMT Rank/ ScheduleMMWO

Rank/ ScheduleMMWO

Picklist/IssueMaterials

Picklist/IssueMaterials

Execute the Work

Execute the Work

StartStart

End

12 Steps (40% Leaner Process)

16

• Revive AccountabilityRevive Accountability Process AwarenessProcess Awareness Performance MeasuresPerformance Measures

• Re-define SAP Role Assignment Re-define SAP Role Assignment • Enhance SAP-PM04 Enhance SAP-PM04

Alert in case of MMWO duplicationAlert in case of MMWO duplication Alert in case of exceeding planned hoursAlert in case of exceeding planned hours

Process ControlProcess Control

Enter History

Enter History

Settle MMWO

Cost

Settle MMWO

Cost

Fill & Appr.Time Sheet

Fill & Appr.Time Sheet

Accept Work&

Close Not.

Accept Work&

Close Not.Tech. comp.

MMWO

Tech. comp.MMWO

BusinessComplete

MMWO

BusinessComplete

MMWO

Create MMT

Create MMT Release &

Save MMT

Release &Save MMT Plan MMT

Plan MMT Rank/ ScheduleMMWO

Rank/ ScheduleMMWO

Picklist/IssueMaterials

Picklist/IssueMaterials

Execute the Work

Execute the Work

StartStart

End

KPI

KPI

KPI

KPI

17

Overall Project ResultsOverall Project Results

Lean + SigmaLean + Sigma

# of Steps# of Steps 3.53.5 44332.42.4

12

13

14

15

16

17

18

19

20

80%

80%

80%

80%

80%

80%

80%

80%

80%

93%

93%

93%

93%

93%

93%

93%

93%

93%

96%

96%

96%

96%

96%

96%

96%

96%

96%

99%

99%

99%

99%

99%

99%

99%

99%

99%Reduce

s non-v

alu

e a

dd s

teps

Reduce

s non-v

alu

e a

dd s

teps

Improves quality of value-add stepsImproves quality of value-add steps

18

SummarySummary

• Lean Sigma is an effective work processes Lean Sigma is an effective work processes enhancement toolenhancement tool

• Promising results are guaranteed with Promising results are guaranteed with proper implementationproper implementation

• Knowledge gain and individual Knowledge gain and individual development is an added benefitdevelopment is an added benefit

19

Thank YouThank You