lean six-sigma 101

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Introduction to Lean Six-Sigma. Presentation from my 1-Day Workshop

TRANSCRIPT

  • WHAT is lean six-sigma?

    (And what is it not?)

  • Six-Sigma is process-focused

    Fix the process, and the outcome shall take care of itself.

    A process has measurable outcomes

    Measurement is a prerequisite to improvement

    The outcomes follow the laws of statistics

    Normal Distribution

  • Tightening the bell-curve means reducing the spread

    to make a process reliable

    When acceptable variation is within 6 of the mean, the no. of defects is only 3.4 per million opportunities.

  • ALWAYS ALWAYS ALWAYS ALWAYS ALWAYS

    Tackle variation before adjusting the mean

  • LEAN SIX-SIGMA

  • Lean Six-Sigma is a

    framework that provides a structured approach to

    eliminate waste and improve customer satisfaction

  • framework

    structure

    waste

    customer

    IS

    IS NOT

    IS

    IS NOT

    IS

    IS NOT

    IS

    IS NOT

    Generic architecture that can be customized to the needs of a specific problem

    An opportunity for to knock oneself out with statistics

    A series of logical steps with a quantifiable business outcome

    A substitute for work!

    A defect, a.k.a. customer pain

    Second-guessing the customer

    The consumer of a process output

    Only the consumer of the companys product or service

  • WHERE is lean six-

    sigma applicable?

  • SIX-SIGMA HAS A BAD REP!

  • NO PAIN NO GAIN

    NO PAIN NO PAIN

    Employees set their own goals based on team goals

    Employees are the source of ideas and managers facilitate successful

    outcomes Employees are responsible for their career path and managers provide development feedback to set them up for success

    Managers set goals for employees

    Managers hand out report-cards to employees judging past performance

    Culture of Empowerment Six-Sigma likely to succeed

    Culture of Dependency Six-Sigma likely to fail

    An employee must take managers permission when stepping outside

    the scope of assigned tasks

  • HOW DOES LEAN SIX-SIGMA APPLY TO SERVICES AS FOR MANUFACTURING?

  • MANUFACTURING OR SERVICES

    OUTCOMES ARE PRODUCED BY A

    LEAN PRINCIPLES CAN BE APPLIED TO:

    Suitcases lost at an airport Rooms not available in time for check-in at a hotel

    When acceptable variation is within 6 of the mean, the no. of defects is only 3.4 per million opportunities.

  • Development Testing Deployment Launch App Support Engineering

    Constructs products

    Assures fitness for use

    Unpacks and installs

    Imparts training

    Help-desk

    Maintenance

  • BEFORE Lean Six-Sigma

    Each department has its own

    view of success

    Firmly rooted in its specialization

    The success of one has very little to do with that

    of

  • AFTER Lean Six-Sigma [mythological interlude]

  • BRAHMA [God of Creation] SHIVA [God of Destruction]

    VISHNU [God of Sustenance]

  • D

    T

    S T

    D

    S Creates new products Assures fitness for use

    Ramps-up users quickly

    Channels change-requests

    Refines and improves product

    Assures system integrity T

    D

    S Ramps-down usage Retires old product

    BUILD PRODUCT SUSTAIN PRODUCT RETIRE PRODUCT

    Development Testing Support Helpdesk D T S

  • AFTER Lean Six-Sigma

    Mindset spills-over departmental lines as Functions participate in acts of creation, sustenance and destruction

    to serve a customer through the IT product lifecycle

  • HOW shall I apply lean six-sigma?

  • BUSINESS CONNECT

  • DEFINE

    Effort must

    connect with the business of the organization.

    1. Customer Requirements

    Voice of Customer (Voc) State the customers pain area Starting point for

    launching an effort Speak the customers

    language

    Return on Investment (RoI) Build the Business Case

    E.g. An initiative to reduce the volume of customer support

    requests may use a template for RoI as

    Cost to support tickets on recurring basis

    v. Cost to implement

    application-fix

  • DEFINE

    Effort must

    connect with the business of the organization.

    2. Process Flow

    Value-stream mapping with SIPOC

  • SUBWAY MAP

    The focus is on getting a passenger from Point A to Point B

  • S

    I

    P

    O

    C

    1. A process is a series of steps

    2. Each step is a verb representing an action taken, such as

    Define Plan Analyze Submit Summarize

    3. The action adds value or it should be eliminated

  • S

    I

    C

    1. Each step in a process produces an outcome

    2. The outcome is a noun, representing output delivered, such as:

    Product Definition Forecast of Sales

    3. The outcome is associated with Critical to Quality metrics (CTQs)

    P

    O

  • S

    I

    O

    1. Each output has an intended recipient called customer

    2. The customer signs-off on the output based on its CTQs. S/he may: Accept

    unconditionally Accept conditionally,

    with left-on-table items clearly listed

    Reject

    P

    C

  • P

    I

    O

    C

    1. A process consumes inputs

    2. Each input is a noun, representing an input consumed, which could be the output of a previous step

    3. Each input may be qualified by CTQs and require the sign-off of process owner

    S

  • P

    S

    O

    C

    1. The provider of an input is called supplier

    2. The supplier of an input is accountable for satisfying CTQs and negotiating sign-off by customer

    I

  • DEFINE

    Effort must

    connect with the business of the organization.

    3. Potential

    1. Project Title &

    Description What is the project?

    2. Project Manager &

    Authority Level Who is given authority to lead the project and can he/she determine, manage and approve changes to budget, staffing, schedule, etc.

    3. Business Need

    Why is the project being done

    4. Business Case

    Financial or other basis that justifies the project

    5. Resource Pre-

    Assignment Men & Materials

    6. Stakeholder Analysis

    Who will affect or be affected by the project as known to date.

    PROJECT CHARTER

  • DEFINE

    Effort must

    connect with the business of the organization.

    3. Potential

    SMART Goals

    Specific Measurable Attainable Realistic Time-bound

    7. Deliverables

    End-result of the project in terms of specific outcomes and the tangible form in which they will be delivered.

    8. Constraints &

    Assumptions A constraint is any limiting factor and an assumption is something taken to be true but which may not be true.

    6. Stakeholder Analysis Stakeholder

    Requirements as known

    Triple Constraints Model (Pentagon)

    Sponsor

    Authorizes the project.

    PROJECT CHARTER

    Risk

  • DEFINE establishes there is a problem.

    MEASURE sizes the problem, and VALIDATES some of the assumptions. Is it as big as we thought? BIGGER?

  • 4. Refined Project Definition

    Measurement Plan To collect data to corroborate the business case made in DEFINE phase.

    Run Chart

    5. Capable Measurement System

    6. Data Collection

    MEASURE

    Cast the objective in measurable

    terms.

    Data Speaks! What data is relevant to

    collect .. .. to establish the magnitude

    of the problem? How it shall be collected? How it shall be presented?

  • FIND THE Y AS IN

    Y characterizes the process in a way that the customer cares about

  • )(xfy

    C O P I S

    MEASURE

    Cast the objective in measurable

    terms.

    Data Speaks!

    S I P O C

    Traditional six-sigma treats y as a measurable characteristic of the process output

    Lean Six-Sigma, y is simply something about the process that the customer would care about

    Lean Six-Sigma, y can simply be the number of tickets logged by an IT Helpdesk in a particular category.

  • MEASURE

    Cast the objective in measurable

    terms.

    Data Speaks!

    CASE-STUDY

    Background One wireless company had a 17% (170,000 parts per million) level of rejected service orders. There were over 30,000 errors per month, which, at an average cost of USD 12.50 to fix (wage cost only), cost USD 375,000 per month. Over 50 temporary workers had been hired to deal with the 2-month backlog of unfixed errors. The objective was to cut this level of rejects in half (9%) by the end of the year.

    RUN CHART Defects per week over a 6 month window

    PARETO 80% defects from 6 transaction codes

  • As

    information systems get

    more complicated ..

  • .. there are more moving

    parts and interdependencies

  • The requirements for adding, changing, and deleting data are often too loose, too tight, or nonexistent, which leads to errors and rejected transactions that must be corrected manually by people hunched over

    computer terminals for 8 hours a day.

  • MEASURE

    Cast the objective in measurable

    terms.

    Data Speaks!

    CASE-STUDY

    Outcome Programmers took 4 months to implement the solution. The

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