Transcript
Page 1: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Introduction to Six Sigma

Page 2: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Topics (Session 1) Understanding Six Sigma

History of Six Sigma

Six Sigma Methodologies & Tools

Roles & Responsibilities

How YOU can use Six Sigma

Page 3: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Six Sigma is. . . A performance goal, representing 3.4 defects for every million

opportunities to make one.

A series of tools and methods used to improve or design products, processes, and/or services.

A statistical measure indicating the number of standard deviations within customer expectations.

A disciplined, fact-based approach to managing a business and its processes.

A means to promote greater awareness of customer needs, performance measurement, and business improvement.

Page 4: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

μ

σ

What’s in a name? Sigma is the Greek letter representing the standard

deviation of a population of data.

Sigma is a measureof variation

(the data spread)

Page 5: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

What does variation mean? Variation means that a

process does not produce the same result (the “Y”)

every time.

Some variation will exist in all processes.

Variation directly affects customer experiences.

Customers do Customers do notnot feel averages! feel averages!

-10

-5

0

5

10

15

20

Page 6: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Measuring Process PerformanceThe pizza delivery example. . .

Customers want their pizza delivered fast!

Guarantee = “30 minutes or less”

What if we measured performance and found an average delivery time of 23.5 minutes?– On-time performance is great, right?– Our customers must be happy with us, right?

Page 7: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

How often are we delivering on time?Answer: Look at the variation!

Managing by the average doesn’t tell the whole story. The average and the variation together show what’s happening.

s

x

30 min. or less

0 10 20 30 40 50

Page 8: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Reduce Variation to Improve PerformanceHow many standard deviations can you “fit” within customer expectations?

Sigma level measures how often we meet (or fail to meet) the requirement(s) of our customer(s).

s

x

30 min. or less

0 10 20 30 40 50

Page 9: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Managing Up the Sigma Scale

Sigma % Good % Bad DPMO

1 30.9% 69.1% 691,462

2 69.1% 30.9% 308,538

3 93.3% 6.7% 66,807

4 99.38% 0.62% 6,210

5 99.977% 0.023% 233

6 99.9997% 0.00034% 3.4

Page 10: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Examples of the Sigma ScaleIn a world at 3 sigma. . .

There are 964 U.S. flight cancellations per day.

The police make 7 false arrests every 4 minutes.

In MA, 5,390 newborns are dropped each year.

In one hour, 47,283 international long distance calls are accidentally disconnected.

In a world at 6 sigma. . .

1 U.S. flight is cancelled every 3 weeks.

There are fewer than 4 false arrests per month.

1 newborn is dropped every 4 years in MA.

It would take more than 2 years to see the same number of dropped international calls.

Page 11: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Topics Understanding Six Sigma

History of Six Sigma

Six Sigma Methodologies & Tools

Roles & Responsibilities

How YOU can use Six Sigma

Page 12: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

The Six Sigma Evolutionary Timeline

1736: French mathematician Abraham de Moivre publishes an article introducing the normal curve.

1896: Italian sociologist Vilfredo Alfredo Pareto introduces the 80/20 rule and the Pareto distribution in Cours d’Economie Politique.

1924: Walter A. Shewhart introduces the control chart and the distinction of special vs. common cause variation as contributors to process problems.

1941: Alex Osborn, head of BBDO Advertising, fathers a widely-adopted set of rules for “brainstorming”.

1949: U. S. DOD issues Military Procedure MIL-P-1629, Procedures for Performing a Failure Mode Effects and Criticality Analysis.

1960: Kaoru Ishikawa introduces his now famous cause-and-effect diagram.

1818: Gauss uses the normal curve to explore the mathematics of error analysis for measurement, probability analysis, and hypothesis testing.

1970s: Dr. Noriaki Kano introduces his two-dimensional quality model and the three types of quality.

1986: Bill Smith, a senior engineer and scientist introduces the concept of Six Sigma at Motorola

1994: Larry Bossidy launches Six Sigma at Allied Signal.

1995: Jack Welch launches Six Sigma at GE.

Page 13: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Six Sigma Companies

Page 14: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Six Sigma and Financial Services

Page 15: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Topics Understanding Six Sigma

History of Six Sigma

Six Sigma Methodologies & Tools

Roles & Responsibilities

How YOU can use Six Sigma

Page 16: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

DMAIC – The Improvement MethodologyDefine Measure Analyze Improve Control

Objective:

DEFINE the opportunity

Objective:

MEASURE current performance

Objective:

ANALYZE the root causes of problems

Objective:

IMPROVE the process to eliminate root causes

Objective:

CONTROL the process to sustain the gains.

Key Define Tools:• Cost of Poor

Quality (COPQ)• Voice of the

Stakeholder (VOS)

• Project Charter• As-Is Process

Map(s)• Primary Metric

(Y)

Key Measure Tools:

• Critical to Quality Requirements (CTQs)

• Sample Plan• Capability

Analysis• Failure Modes

and Effect Analysis (FMEA)

Key Analyze Tools:

• Histograms, Boxplots, Multi-Vari Charts, etc.

• Hypothesis Tests• Regression

Analysis

Key Improve Tools:

• Solution Selection Matrix

• To-Be Process Map(s)

Key Control Tools:

• Control Charts• Contingency

and/or Action Plan(s)

Page 17: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

What is the problem? The “problem” is the Output (a “Y” in a math equation Y=f(x1,x2,x3) etc).

What is the cost of this problem Who are the stake holders / decision makers Align resources and expectations

Define – DMAIC ProjectWhat is the project?

Six SigmaSix Sigma

Project Project CharterCharter

Voice of the

Stakeholder

S takeho lders

$

Cost of Poor

Quality

Page 18: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Define – As-Is ProcessHow does our existing process work?Move-It! Courier Package HandlingProcess

Acc

ou

ntin

gF

ina

lizin

gD

eliv

ery

Out-Sort SupervisorOut-Sort ClerkAccounts

SupervisorAccounts

Receivable ClerkWeight Fee ClerkDistance Fee ClerkIn-Sort SupervisorIn-Sort ClerkMail ClerkCourier

Observ e packageweight (1 or 2) onback of package

Look upappropriate

Weight Fee andwrite in top middle

box on packageback

Take packagesf rom Weight FeeClerk Outbox toA/R Clerk Inbox.

Add Distance &Weight Fees

together and writein top right box on

package back

Circle Total Feeand Draw Arrow

f rom total tosender code

Take packagesf rom A/R Clerk

Outbox toAccounts

Superv isor Inbox.

Write Total Feef rom package in

appropriateSender column onAccts. Supv .’s log

Add up Total # ofPackages and

Total Fees f romlog and createclient inv oice

Deliv er inv oice toclient

Submit log toGeneral Managerat conclusion of

round.

Take packagesf rom Accounts

Superv isorOutbox to Out-

Sort Clerk Inbox.

Draw 5-point Starin upper right

corner of packagef ront

Sort packages inorder of Sender

Code bef oreplacing in outbox

Take packagesf rom Out-Sort

Clerk Outbox toOut-Sort

Superv isor Inbox.

Observ e senderand receiv er

codes and makeentry in Out-SortSuperv isor’s log

Deliv er Packagesto customers

according to N, S,E, W route

Submit log toGeneral Managerat end of round

Submit log toGeneral Managerat end of round

Does EVERYONE agree how the current process works?

Define the Non Value Add steps

Page 19: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Define – Customer RequirementsWhat are the CTQs? What motivates the customer?

Voice of the CustomerVoice of the Customer Key Customer IssueKey Customer Issue Critical to QualityCritical to QualitySECONDARY RESEARCH

PRIMARY RESEARCH

Surveys

Surveys

OTM

Market DataIn

du

stry

In

tel

List

en

ing

Post

s

Industry Benchmarking

Focus Groups

Customer Service

Customer Correspondence

Obser-vations

Page 20: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Measure – Baselines and CapabilityWhat is our current level of performance?

Sample some data / not all data Current Process actuals measured against

the Customer expectation What is the chance that we will succeed

at this level every time?50403020100

95% Confidence Interval for Mu

26.525.524.523.522.521.520.519.5

95% Confidence Interval for Median

Variable: 2003 Output

19.7313

8.9690

21.1423

Maximum3rd QuartileMedian1st QuartileMinimum

NKurtosisSkewnessVarianceStDevMean

P-Value:A-Squared:

26.0572

11.8667

25.1961

55.290729.610023.147516.4134 0.2156

1000.2407710.238483

104.34910.215223.1692

0.8540.211

95% Confidence Interval for Median

95% Confidence Interval for Sigma

95% Confidence Interval for Mu

Anderson-Darling Normality Test

Descriptive Statistics

OthersAmount

Late

41779 4.017.079.0

100.0 96.0 79.0

100

50

0

100

80

60

40

20

0

Defect

CountPercentCum %

Pe

rce

nt

Co

unt

Pareto Chart for Txfr Defects

Page 21: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Measure – Failures and RisksWhere does our process fail and why? Subjective opinion mapped into an “objective” risk profile number

Failure Modes and Effects Analysis (FMEA)

Process or Product Name:

Prepared by: Page ____ of ____

Responsible: FMEA Date (Orig) ______________ (Rev) _____________

Process Step/Part Number Potential Failure Mode Potential Failure Effects

SEV Potential Causes

OCC Current Controls

DET

RPN

Actions Recommended Resp. Actions Taken

SEV

OCC

DET

RPN

0 0

0 0

0 0

0 0

0 0

0 0

0 0

0 0

0 0

0 0

0 0

0 0

0 0

0 0

0 0

0 0

0 0

0 0

Process/Product

X1

X2

X4

X3

etc

Page 22: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Six SigmaSix Sigma

Analyze – Potential Root CausesWhat affects our process?

y = f (xy = f (x11, x, x22, x, x33 . . . x . . . xnn))

Ishikawa Diagram

(Fishbone)

Page 23: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Analyze – Validated Root CausesWhat are the key root causes?

41779 4.017.079.0

100.0 96.0 79.0

100

50

0

100

80

60

40

20

0

Defect

CountPercentCum %

Perc

ent

Coun

t

Pareto Chart for Txfr Defects

Six SigmaSix Sigma

y = f (xy = f (x11, x, x22, x, x33 . . . x . . . xnn))Critical Xs

2 31211.817.670.6

100.0 88.2 70.6

15

10

5

0

100

80

60

40

20

0

Defect

CountPercentCum %

Perc

ent

Coun

t

Pareto Chart for Amt Defects

Process Simulatio

n

Data Stratificatio

n

Regression Analysis

Experim ental Design

Page 24: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Improve – Potential SolutionsHow can we address the root causes we identified?

Address the causes, not the symptoms.

y = f (xy = f (x11, x, x22, x, x33 . . . x . . . xnn))

Critical Xs

Decision

Evaluat

e

Clarify

Generat

e

Divergent | ConvergentDivergent | Convergent

Page 25: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Improve – Solution SelectionHow do we choose the best solution?

Time

Quality

Cost

Solution Sigma Time CBA Other Score

Six SigmaSix Sigma

Solution Solution ImplementatioImplementatio

n Plann Plan

Solution Selection Matrix

☺ Nice Try

Nice Idea X

Solution Right Wrong

Imp

lem

enta

tio

n

Bad

G

ood

Page 26: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Control – Sustainable BenefitsHow do we ”hold the gains” of our new process?

Some variation is normal and OK How High and Low can an “X” go yet not materially impact the “Y” Pre-plan approach for control exceptions

0 10 20 30

15

25

35

Observation NumberIn

divi

dual

Val

ue

Mean=24.35

UCL=33.48

LCL=15.21

Process Owner: Date:Process Description: CCR:

Measuring and Monitoring

Key Measurements

Specs &/or

Targets

Measures (Tools)

Where & Frequency

Responsibility (Who)

Contingency (Quick Fix)

Remarks

P1 - activity duration, min.

P2 - # of incomplete loan applications

Process Control System (Business Process Framework)

Direct Process Customer:

Flowchart

Custom er Sales Branch ManagerProcessingLoan Service

Manager

1.1

Ap

plic

atio

n &

Re

vie

w1

.2P

roce

ssin

g1

.3C

red

it re

vie

w1

.4R

evi

ew

1.5

Dis

clo

sure

Apply forloan

Reviewappliation for

com pleteness

ApplicationCom plete?

Com pletem eeting

inform ationNo

Page 27: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

DFSS – The Design MethodologyDesign for Six Sigma

Uses– Design new processes, products, and/or services from scratch– Replace old processes where improvement will not suffice

Differences between DFSS and DMAIC– Projects typically longer than 4-6 months– Extensive definition of Customer Requirements (CTQs)– Heavy emphasis on benchmarking and simulation; less emphasis on

baselining Key Tools

– Multi-Generational Planning (MGP)– Quality Function Deployment (QFD)

Define Measure Analyze Develop Verify

Page 28: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Topics Understanding Six Sigma

History of Six Sigma

Six Sigma Methodologies & Tools

Roles & Responsibilities

How YOU can use Six Sigma

Page 29: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Champions Promote awareness and execution of Six Sigma

within lines of business and/or functions

Identify potential Six Sigma projects to be executed by Black Belts and Green Belts

Identify, select, and support Black Belt and Green Belt candidates

Participate in 2-3 days of workshop training

Page 30: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Black Belts

Use Six Sigma methodologies and advanced tools (to execute business improvement projects

Are dedicated full-time (100%) to Six Sigma

Serve as Six Sigma knowledge leaders within Business Unit(s)

Undergo 5 weeks of training over 5-10 months

Page 31: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Green Belts Use Six Sigma DMAIC methodology and basic tools

to execute improvements within their existing job function(s)

May lead smaller improvement projects within Business Unit(s)

Bring knowledge of Six Sigma concepts & tools to their respective job function(s)

Undergo 8-11 days of training over 3-6 months

Page 32: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Subject Matter Experts– Provide specific process knowledge to Six Sigma teams– Ad hoc members of Six Sigma project teams

Financial Controllers– Ensure validity and reliability of financial figures used

by Six Sigma project teams– Assist in development of financial components of

initial business case and final cost-benefit analysis

Other Roles

Page 33: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Topics Understanding Six Sigma

History of Six Sigma

Six Sigma Methodologies & Tools

Roles & Responsibilities

How YOU can use Six Sigma

Page 34: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Questions?

Page 35: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Topics for Detailed Discussion Problem Identification Cost of Poor Quality Problem Refinement Process Understanding Potential X to Critical X Improvement

Page 36: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Problem Identification

“If it ain’t broke, why fix it

“This is the way we’ve always done it…”

Page 37: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Problem Identification

• First Pass Yield

• Roll Throughput Yield

• Histogram

• Pareto

Page 38: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Problem IdentificationFirst Pass Yield (FPY):

The probability that any given unit can go through a system defect-free without rework.

Step 1

Step 2

Step 3

Step 4

Scrap 10 Units

100 Units

100

90

87

Scrap 3 Units

Scrap 2 Units

85

Outputs / Inputs

100 / 100 = 1

90 / 100 = .90

87 / 90 = .96

85 / 87 = .97

At first glance, the yield would seem to be 85% (85/100 but….)

When in fact the FPY is (1 x .90 x .96 x .97 = .838)

Page 39: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Problem Identification

Step 1

Step 2

Step 3

Step 4

Re-Work 10 Units

100 Units

Re-Work 3 Units

Re-Work 2 Units

Rolled Throughput Yield (RTY):

The yield of individual process steps multiplied together. Reflects the hidden factory rework issues associated with a process.

Outputs / Inputs

90 / 100 = .90

97 / 100 = .97

98 / 100 = .98

.90 x .97 x .98 = .855

100 Units

100 Units

100 Units

100 Units

Page 40: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Problem IdentificationRTY Examples - Widgets

Function 1

Function 2

Function 3

Function 4

50

5

10

5

50

50

50

50

Roll Throughput Yield

50/50 = 1

(50-5)/50 = .90

(50-10)/50 = .80

(50-5)/50 = .90

1 x .90 x .80 x .90 = .65

Put another way, this process is operating a 65% efficiency

Page 41: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

RTY Example - Loan Underwriting

Roll Throughput Yield

50/50 = 1

(50-7-2)/50 = .82

(43-6)/43 = .86

(43-1-2)/43 = .93

1 x .82 x .86 x .93 = .66

Put another way, this process is operating a 66% efficiency

Application

Underwrite

Complete Full Paperwork

Close

50

Fails Underwriting

Decide not to borrow

2

6

2

7

1

42

50

43

43

Problem Identification

Page 42: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Histogram – A histogram is a basic graphing tool that displays the relative frequency or occurrence of continuous data values showing which values occur most and least frequently. A histogram illustrates the shape, centering, and spread of data distribution and indicates whether there are any outliers.

Problem Identification

5004003002001000

40

30

20

10

0

C8

Fre

que

ncy

Histogram of Cycle Time

Page 43: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Histogram – Can also help us graphically understand the data

Problem Identification

40032525017510025

95% Confidence Interval for Mu

9484746454

95% Confidence Interval for Median

Variable: CT

55.753

61.098

69.947

Maximum3rd QuartileMedian1st QuartileMinimum

NKurtosisSkewnessVarianceStDevMean

P-Value:A-Squared:

84.494

75.664

90.417

444.000105.000 66.000 31.000 1.000

1708.263562.317124569.8167.600380.1824

0.0006.261

95% Confidence Interval for Median

95% Confidence Interval for Sigma

95% Confidence Interval for Mu

Anderson-Darling Normality Test

Descriptive Statistics

Page 44: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Pareto – The Pareto principle states that 80% of the impact of the problem will show up in 20% of the causes. A bar chart that displays by frequency, in descending order, the most important defects.

Problem Identification

159613.586.5

100.0 86.5

100

50

0

100

80

60

40

20

0

Defect

CountPercentCum %

Per

cen

t

Cou

nt

Pareto Chart for WEB

Page 45: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Topics (Session 2) Problem Identification Cost of Poor Quality Problem Refinement Process Understanding Potential X to Critical X Improvement

Page 46: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Cost of Poor QualityCOPQ - The cost involved in fulfilling the gap between the desired and actual product/service quality. It also includes the cost of lost opportunity due to the loss of resources used in rectifying the defect.

Examples / Buckets–

Roll Throughput Yield Inefficiencies (GAP between desired result and current result multiplied by direct costs AND indirect costs in the process).

Cycle Time GAP (stated as a percentage between current results and desired results) multiplied by direct and indirect costs in the process.

Square Footage opportunity cost, advertising costs, overhead costs, etc…

Hard Savings - Six Sigma project benefits that allow you to do the same amount of business with less employees (cost savings) or handle more business without adding people (cost avoidance).

Soft Savings - Six Sigma project benefits such as reduced time to market, cost avoidance, lost profit avoidance, improved employee morale, enhanced image for the organization and other intangibles may result in additional savings to your organization, but are harder to quantify.

Page 47: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Topics (Session 2) Problem Identification Cost of Poor Quality Problem Refinement Process Understanding Potential X to Critical X Improvement

Page 48: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Multi Level Pareto – Logically Break down initial Pareto data into sub-sets (to help refine area of focus)

Problem Refinement

159613.586.5

100.0 86.5

100

50

0

100

80

60

40

20

0

Defect

CountPercentCum %

Per

cen

t

Cou

nt

Pareto Chart for WEB

1613354514.711.932.141.3

100.0 85.3 73.4 41.3

100

50

0

100

80

60

40

20

0

Defect

CountPercentCum %

Per

cen

t

Cou

nt

Pareto Chart for Type

Page 49: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Problem Statement – A crisp description of what we are trying to solve.

Primary Metric – An objective measurement of what we are attempting to solve (the “y” in the y = f(x1, x2, x3….) calculation).

Secondary Metric – An objective measurement that ensures that a Six Sigma Project does not create a new problem as it fixes the primary problem. For example, a quality metric would be a good secondary metric for an improve cycle time primary metric.

Problem Refinement

Page 50: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Fish Bone Diagram - A tool used to solve quality problems by brainstorming causes and logically organizing them by branches. Also called the Cause & Effect diagram and Ishikawa diagram

Problem Refinement

Provides tool for exploring cause / effect and 5 whys

Page 51: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Topics (Session 2) Problem Identification Cost of Poor Quality Problem Refinement Process Understanding Potential X to Critical X Improvement

Page 52: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

SIPOC – Suppliers, Inputs, Process, Outputs, Customers

You obtain inputs from suppliers, add value through your process, and provide an output that meets or exceeds your customer's requirements.

Process Understanding

Page 53: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Process Map – should allow people unfamiliar with the process to understand the interaction of causes during the work-flow. Should outline Value Added (VA) steps and non-value add (NVA) steps.

Process Understanding

Receipt / Extract

Requal Group

Remit

Data Cap

I nventory

Start Size Sorts Control Docs

Open Pull & Sort

Verif y

Pass 1

Key f rom image Balance

Pass 2Rulrs

Perfection

No

Prep cks Ship to I P

Full Form QCReview

Ship to Cust

Vouch OK

Prep Folders /

Box

Yes

No

Vouchers

Full Form

Ck / Vouch

Yes Prep cks, route vouch

Page 54: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Operations

HR / Recruit

Training

Start

Manually Update HR

Billet Request

Create Staff Billet

Review Staff Billet

Check off desired returnee

staff & "need to retrain"

list

Send Letters to desired

staff

Do they respond?

Call (3x)

No

Have we hired

enough?

Stop!

Yes

Rev original billet &

call uncheck

ed

I nterview / pre-hire

Meet Fleet hiring

criteria

Stop!

No

Place into dept

Yes

show up orienta

tion

Call3X

No

To Floor

schedule for

training

Show up?

Call1X

No

Train

Pass?

Need OJ T Re-Tng

No

HR sends req for staffi ng

nos.

Create daily peak staff need plan

Add 30% to the required

no.

What if the returnee is

already working here on another program? Currently

send the ltr anyways

Do they want to

work this peak?

Do they want to

stay on the list

No

Take off I PS

system

No

Set 14 month

flag (on I PS?)

Yes

Yes

Add 40% to staff needed

Yes

New & Other People call in

Wait List

No Rank as "1 2 3"

New

Update I PS

Compare to original Billet rpt

Call employee(3x)

Can they make it?

Action Plan

No

To FloorYes

ReachYes

Update I PS

Gen rpt f or Ops Kronos

Recruit

Gen Event Roster rpt in I PS

No

NoYes

OJ TMake it?

Yes

Yes

No

Yes

Hire in 1-2 order (3's are

not placed)

Notif y HR

Need re-train

No Yes

Do they want to

work this peak?

Do they want to

stay on the list

No

Yes

Set 14 month

flag (on I PS?)

Take off I PS

system

Have we hired

enough?

Call Wait List

NoYes

Stop!

Yes

No

No

Yes

Yes

Process Understanding

Page 55: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Topics (Session 2) Problem Identification Cost of Poor Quality Problem Refinement Process Understanding Potential X to Critical X Improvement

Page 56: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Potential X to Critical X

“Y” is the dependent output of a variable process. In other words, output is a function of input variables (Y=f(x1, x2, x3…).

Through hypothesis testing, Six Sigma allows one to determine which attributes (basic descriptor (generally limited or binary in nature) for data we gather – ie. day of the week, shift, supervisor, site location, machine type, work type, affect the output. For example, statistically, does one shift make more errors or have a longer cycle time than another? Do we make more errors on Fridays than on Mondays? Is one site faster than another? Once we determine which attributes affect our output, we determine the degree of impact using Design of Experiment (DOE).

Page 57: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Potential X to Critical X

A Design of Experiment (DOE) is a structured, organized method for determining the relationship between factors (Xs) affecting a process and the output of that process (Y). Not only is the direct affect of an X1 gauged against Y but also the affect of X1 on X2 against Y is also gauged. In other words, DOE allows us to determine - does one input (x1) affect another input (x2) as well as Output (Y).

Page 58: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Potential X to Critical XDOE Example

P2JamSKDCDELJams

1.4

1.3

1.2

1.1

1.0

Ela

pse

d

Main Effects Plot (data means) for Elapsed

1.00

1.25

1.50

1.00

1.25

1.50

1.00

1.25

1.50

1.00

1.25

1.50Jams

DCDEL

SK

P2Jam

3

1

1

3

1

3

1

3

Interaction Plot (data means) for Elapsed

Main Effects Plot – Direct impact to Y

Interaction Plot – Impacts of X’s on each other

Page 59: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Potential X to Critical X

DOE Optimizer – Allows us to statistically predict the Output (Y) based on optimizing the inputs (X) from the Design of experiment data.

Page 60: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Topics (Session 2) Problem Identification Cost of Poor Quality Problem Refinement Process Understanding Potential X to Critical X Improvement

Page 61: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Improvement

Once we know the degree to which inputs (X) affect our output (Y), we can explore improvement ideas, focusing on the cost benefit of a given improvement as it relates to the degree it will affect the output. In other words, we generally will not attempt to fix every X, only those that give us the greatest impact and are financially or customer justified.

Page 62: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Control

Once improvements are made, the question becomes, are the improvement consistent with predicted Design of Experiment results (ie – are they what we expected) and, are they statistically different than pre-improvement results.

1.00.50.0-0.5-1.0

USLLSL

Process Capability Analysis for Sept

% Total

% > USL

% < LSL

% Total

% > USL

% < LSL

% Total

% > USL

% < LSL

Ppk

Z.LSL

Z.USL

Z.Bench

Cpm

Cpk

Z.LSL

Z.USL

Z.Bench

StDev (Overall)

StDev (Within)

Sample N

Mean

LSL

Target

USL

12.62

12.62

0.00

6.35

6.35

0.00

13.04

13.04

0.00

0.38

4.40

1.14

1.14

*

0.51

5.87

1.53

1.53

0.221880

0.166425

23

-0.02391

-1.00000

*

0.23000

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

Potential (Within) Capability

Process Data

Within

Overall

Page 63: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Control

Control Chart - A graphical tool for monitoring changes that occur within a process, by distinguishing variation that is inherent in the process(common cause) from variation that yields a change to the process(special cause). This change may be a single point or a series of points in time - each is a signal that something is different from what was previously observed and measured.

Sept 20Sept 13Subgroup

0.5

0.0

-0.5

Ind

ivid

ua

l Va

lue

9/259/13Date

2

1

Mean=0.03

UCL=0.5293

LCL=-0.4693

0.70.6

0.50.40.30.20.10.0

Mo

vin

g R

an

ge

1

R=0.1877

UCL=0.6134

LCL=0

I and MR Chart for Sept

Page 64: Introduction to Six Sigma. Topics (Session 1)  Understanding Six Sigma  History of Six Sigma  Six Sigma Methodologies & Tools  Roles & Responsibilities

Wrap Up

Thanks – Vijay Rao


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