session 01 - introdu

Module 1 Yellow Belt Training 1

IntroIntro

Introduction to the Tools of Leanand Six Sigma (“LSS”)

Yellow Belt TrainingBuilding new skills to improve quality and management practices across HBD


IntroIntroWhat You Should Learn Today

• How We Will Teach

• What is Lean Six Sigma?

• Key Aspects of Lean and Six Sigma Improvement Methodologies

• Overview of HBD’s Lean Six Sigma Implementation

• Prior Projects’ Areas of Focus

• DMAIC Methodology Overview

• Tools to be Learned as a Yellow Belt


IntroIntroHow We Will Teach

• Focus for Approx. 60 Minutes in Class

• Deliver Pre-Class Reading Materials (“Pre-Work”)

• Introduce Key Concepts for Recognition and Everyday Usage

• Provide Real-life Examples and Opportunities for Discussion

• Encourage Participation by All

• Quiz Students to Encourage Learning and Memory Recall

• Ask for Immediate Feedback and Benefits & Concerns (“B’s & C’s”)


IntroIntroWhy Teach Me This Stuff?

• Culture is common thinking.

• Thinking drives behavior.

• Behavior drives results.

• Results create opportunities and security.

The Lean Six Sigma curriculum combines the discipline and analytical tools of Six Sigma with the time-based focus of Lean. Our

goal is to build and enhance skills among employees that can improve quality and strengthen management practices across HBD.


IntroIntroWhy Teach Me This Stuff? (con’t)

• The tools and methodologies in Lean Six Sigma are useful not only in LSS projects, but in everyday tasks. These include:– Understanding Customer and Stakeholder Needs

– Identifying, Analyzing and Presenting Key Business Information

– Brainstorming on, Deciding upon, and Solving Complex Issues

– Revising and Simplifying Production-Related Processes

– Streamlining Administrative Processes and Support Tasks

– Understanding Variation

– Managing Cross-Functional Projects

• The more you understand what these tools are and the underlying philosophy behind them, the better you will be as an active team member in future projects.


IntroIntroWhat is Lean Six Sigma?For HBD, Lean + Six Sigma = Profit Power!

Per-Unit Profit = Per-Unit Price – Per-Unit Cost;

Net Profit = Sales – Product Costs – Overhead Expenses

Lean Six Sigma offers you the power to

transform operations into flexible, efficient plants

needed to profitably survive and thrive

in a competitive business landscape.

1251007550250-25-50

TargetUSLLSL

Capability Analysis: Roll Order Entry Time Efficiency - After Close-out

PPM Total

PPM > USL

PPM < LSL

PPM Total

PPM > USL

PPM < LSL

PPM Total

PPM > USL

PPM < LSL

Ppk

PPL

PPU

Pp

Cpm

Cpk

CPL

CPU

Cp

StDev (Overall)

StDev (Within)

Sample N

Mean

LSL

Target

USL

403073.86

15087.61

387986.25

367500.05

3929.62

363570.43

491228.07

0.00

491228.07

0.09

0.09

0.72

0.41

0.41

0.12

0.12

0.89

0.50

28.5440

23.2791

171

38.123

30.000

40.000

100.000

Exp. "Overall" PerformanceExp. "Within" PerformanceObserved PerformanceOverall Capability

Potential (Within) Capability

Process Data

Within

Overall


IntroIntroThe Money Map

The Money Map -- Where Do YOU Play a Role in this System?Prices Paid By Customers

– Costs To Manufacture Products & Manage The Business= Profit Available To Reinvest In Jobs And Plants

From "What Customers Want"Quality Products and Effective SolutionsCompetitive Prices and Low Cost of InteractionOn-Time Deliveries and Reliable Promise DatesAccurate Pre-Sale Information and Post-Sale Services

Supplier Chosen And Prices Paid

To "How HBD Makes Products for Sale to Customers"Sales and Marketing EffortProduct Designs and Technical SpecificationsRaw Materials and Inputs from SuppliersProduction Labor and Conversion EnergyGeneral Management and AdministrationPost-Sale Billing, Collection, and Customer Support

Products Manufactured And Business Costs Paid

Equals "How HBD Makes Profits to Prosper in its Businesses"

•Productivity

•Efficiency

•Quality

•Speed

•Flexibility

Profit (or Loss) =(Unit Prices x

Volume Sold) – Costs Incurred


IntroIntroKey Aspects of Lean

• Lean is Not New– Popularized by Toyota more than 30 years ago.

– Many of its tools and concepts have been around for decades.

• Lean is Both Methodology and Philosophy– Lean aims to eliminate ‘waste’ (in Japanese, “muda”) in every area of a

business, including production, customer relations, product design, supplier networks, and factory and business administration.

– Its goal is to incorporate less effort, less inventory, less time to develop products, and less space in order to become highly responsive to actual customer demand and to produce top-quality product in the most timely, efficient and economical manner possible.

• Lean Focuses on Customer-Defined Value– A process step ‘adds value’ if the activity adds form, fit or function to the

product that is desired by the customer, and the customer is willing to pay you to conduct that activity.


IntroIntroKey Aspects of Lean, con’t

• Toyota Defines Seven Key Types of Muda (Waste)– Overproduction: Producing more than demanded or before it is

needed, e.g., stored materials or inventories.

– Inventory or Work-in-Process (WIP): Material between operations due to large lot sizes or long process cycle times.

– Transportation: Material movements, by definition, add no value to products, as they do not affect form, fit or function.

– Processing Waste: Unnecessary or inefficient process steps simply add cost and time.

– Motion: Effort to move workers and machinery or to transport materials adds cost and delay.

– Waiting: Long changeover times, slow processing times, and materials handling tasks limit opportunities to make on-time deliveries.

– Defective Products: Items that fail to meet customer specifications are pure waste, e.g., returns, rework, scrap, and warranty costs.


IntroIntroKey Aspects of Six Sigma

• Six Sigma is Not New– In existence for more than 20 years; at HBD since 2002.

– Many of its tools and concepts have been around for decades.

– Six Sigma packages the tools and concepts into a clear and systematic roadmap for process improvement.

• Six Sigma is a Methodology– The ‘DMAIC’ problem-solving methodology is a disciplined thought

process and tool guide used to solve business issues.

– Define / Measure / Analyze / Improve / Control / (and Verify).

• Variation is Bad (‘Evil’)– For most processes, a repeatable and predictable result is crucial.

– Six Sigma is designed to identify the key sources of variation and drive them out of the process, by understanding the key inputs, processes and outputs of business activities. “Fix the process to get good results.”


IntroIntroKey Aspects of Six Sigma, con’t

• Six Sigma has a Customer Focus– Processes and problems must be viewed from the customer’s

perspective.

– Internal customers (i.e., downstream departments) can be just as important as external customers (i.e., those who pay the bills).

• Six Sigma is Not Just for Manufacturing or Large Businesses– Success can be found in all types of companies and all kinds of

processes – including at HBD.

• AND…Six Sigma and Lean are Not Mutually Exclusive– Without a basic understanding of both methodologies, you risk trying to

‘use a screwdriver to drive a nail.’

– Ask, ‘What tool or technique is most useful to help solve my problem?’


IntroIntroOverview ofHBD’s LSS Implementation

• LSS supports HBD’s long-standing corporate strategies– Customer Satisfaction

– Marketing Excellence

– Working Capital Management

– Cost Reduction and Containment

• LSS was introduced into HBD in 2002, first with the Executive Office and General Managers and then locally at the plants– 88 individuals in all 17 business locations trained in LSS (at 7/30/07)

• Projects have successfully touched both production and back-office (paperwork) processes– 112 LSS projects initiated (as of 7/31/07) plus 29 documented kaizens

– Over $6.65MM in hard-dollar and soft-dollar savings, cost avoidance, new-revenue opportunities, and working capital improvements

• LSS represents one key tool for on-going improvement efforts


IntroIntroLSS Projects’ Areas of Focus

• Cost Reduction– Product and Unit Costs, Overhead and Period Expenses, Scrap and Rework

• Cost Avoidance– Regulatory Expenses, Capital Equipment Needs

• Capacity Increase– Production Availability, Quick Changeovers, Equipment Utilization

• Customer Satisfaction– On-time Delivery, Quotation and Production Lead-time, Quality, Cost (Pricing)

• Health & Safety– Ergonomics

• Flow– Process Speed, Travel Distance, On-time Delivery, Lead-time

• Working Capital Reduction– Finished Goods, Work-in-Process and Raw Materials Inventories

• New Revenue– Revised or New Products


IntroIntroWho’s Who inHBD’s LSS Project Teams

• Corporate Champion (Nelson Law – Dublin, OH)– Helps identify possible projects; Selects / approves projects for launch

• Team Facilitator (Black Belt or Green Belt)– Formally-trained team leader who guides team’s analyses and activities

• Project Sponsor– Process owner with responsibility / authority over process under study– Accountable for long-term sustainability of project’s gains and results

• Core Team Members (managers, supervisors, operators)– Cross-functional subject matter experts who “live with the process”;

Mandated to meet regularly to make project progress

• Ad Hoc Team Members (managers, supervisors, operators)– Additional subject matter experts who may be called upon occasionally

for help

• Supporting Supervisors, Managers & Coworkers of Team Members– Not direct part of project team activities; Must plan for / support ways to

allow core team members to meet regularly


IntroIntro

Ideas; Guesswork

Dynamics of Process Improvement:The Funnel Effect

Define Phase

Measure Phase

Analyze Phase

Improve Phase

Control Phase

Optimized Process

30 - 50 Inputs

10 - 15 KPIVs

8 - 10 KPIVs

3-6 Critical KPIVs

KPIV = Key Process Input Variable

KPOV = Key Process Output Variable

Data; Information

Root Causes

Experiments; Changes

Documentation; Controls

Project Charter


IntroIntroDMAIC Methodology Overview:The Five Phases of Every LSS Project

• DEFINE– Define opportunity, project scope, potential benefits and resource needs

• MEASURE– Determine process map and metrics; Get baseline performance levels;

Define customer requirements for success; Display collected data

• ANALYZE– Explore root causes of process variation, poor process flow and current

underperformance

• IMPROVE– Brainstorm and prioritize potential solutions; Pilot-test selected changes;

Select and implement preferred solutions

• CONTROL– Complete transition back to process owner; Confirm that new process is

stable; Document control plans; Identify and transfer best practices


IntroIntroYellow Belt Curriculum Objectives

• Through the Yellow Belt curriculum, every employee should:– Understand that Lean and Six Sigma are all about ensuring quality in

terms of the Voice of the Customer

– Understand how data analysis drives business decisions

– Understand how root cause analysis drives solution implementation

– Understand the basics of metrics to describe overall business health

– Understand the use and presentation of data to develop insights and achieve goals

– Understand the importance of identifying and controlling process variation and thus costs

– Understand the application of control mechanisms to sustain changes


IntroIntroTools to be Learned

• Team Problem Solving and Team Effectiveness (Working in Teams)– Cross-Functional Teams– Characteristics of Effective Team Meetings– Project Charters and Meeting Agendas

• Voice of the Customer (Knowing What is Important)– Sources of the Voice of the Customer– Critical-to-Quality Factors and Critical Customer Requirements

• Idea Generation and Grouping (Working with Ideas)– Brainstorming; Force Field Analysis– Cause-and-Effect Diagram / 6Ms; Root Cause Analysis / 5 Why’s– Affinity Diagram; Nominal Group Technique; Multi-voting

• Data Collection, Analysis and Presentation (Working with Numbers)– Process and Business Metrics– Data Collection Plan– Check Sheet, Process Study Log and Other Data Collection Forms– Data Stratification and Segmentation– Histogram, Run Chart, Control Chart and Other Graphical Presentations of Data


IntroIntroTools to be Learned, con’t

• Decision-making Tools (Working with Facts)– Pareto Analysis; Pareto Chart– Understanding and Explaining Process Variation– Cause-and-Effect Matrix and Other Prioritization & Selection Tools

• Speed and Flow Implementation (Ensuring Value)– Process Mapping and Flowcharts– Value-Add vs. Non-Value-Added– 5S / Workplace Organization– Spaghetti Diagram (Workflow) and Work Cell Layout– Quick Changeover: Setup and Changeover Reduction– Pull-based Flow and Replenishment

• Defect Prevention and Mistake-Proofing (Quality at the Source)– Standardized Work and Best Practices– Visual Workplace: Visual Aids and Learning Tools– Poka-Yoke (Mistake-Proofing) Devices– Preventative Maintenance (Total Productive Maintenance)– Design Simplification and Parts Rationalization


IntroIntroContinuous Improvement through Lean Six Sigma (summary)

• Observe processes

• Identify problems and gather data

• Determine root causes of the problems

• Identify countermeasures / solutions, and

• Regularly participate in activities to simplify processes and eliminate waste, unevenness, and unreasonableness.

And…Practice non-blaming and non-judgmental behaviors, as these are required for realizing genuine continuous improvement.


IntroIntroTakeaways

• Every person has a hand in generating profit and, in turn, job security.

• Lean Six Sigma is not solely about statistics or SPC (statistical process control) but is a very successful method to enable continuous improvement.

• Lean Six Sigma provides a powerful set of problem-solving tools and team effectiveness techniques to address complex issues.

• These proven tools and techniques can be used anywhere – and we do mean, anywhere!

• Lean Six Sigma emphasizes team-based creativity, analytical thinking, and data-driven decision-making.

session 01 - introdu

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