lean_sigma_awareness

Lean Sigma Awareness

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Operational Excellence

Robert Mallett, LSSBB

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Integrity, Honesty, Safety and Quality

We will conduct business with integrity and honesty in compliance with all laws

and Company policy.

We are committed to produce products in a safe environment that are of the

highest quality for our customers.

Agenda

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• Objectives• Focus on Operational Excellence • Operating System/Kaizen Overview• DMAIC Roadmap• Define • Measure • Analyze • Improve • Control • Next Steps

“It is wrong to suppose that if you can’t measure it, you can’t manage it

—a costly myth.”

Dr. Edward W. Deming

| LS Awareness 2Hr June 2014 | Confidential 4

Objectives


• Enhance Awareness on the Lean Sigma DMAIC methodologies.

• Foster a culture of Continuous Improvement based on empowerment, inclusiveness and metric-based results.

Areas for Focus on Operational Excellence

• LeanSixSigma• Design for Manufacturing

• Change Management• Project Management

• Cost Reduction• Improved Customer

Satisfaction• Improved Quality• Engaged Employees

•Strategy Deployment•Value Stream Analysis•Kaizen Methods•Root Cause Analysis

• Certified Black Belt• Training and Mentoring

Skills

People

ProcessTools

Results


Impact of Operational ExcellenceImproves Quality and Delivery

– Reducing process variation– Improving process reliability through standard work– Enhancing Customer Satisfaction through process and product consistency

Decreases the cost of doing business– Reducing defects / scrap– Improving process “workflow”

Increases Revenue - “Growing the Business”– Improving Customer satisfaction – Pricing Excellence– Introduction of robust and reliable new product designs– Increased revenues through new products/customers

Strengthens our employees’ analytical and leadership skills– Data-driven, fact-based decision making tools– Sharing of best practices globally– Impacts all functions within


How Operational Excellence aligns (example)


COV 2020 Strategic Priorities FY14 OpEx & Eng. Focus Areas

BroadenInnovation

Focus

− Accelerate product development and increase R&D effectiveness

− Develop customer-focused commercial model− Develop new value-added customer offerings

− PDP support to accelerate product Launch− DFSS/Lean training integration− Support Vitality Index, R&D Effectiveness and innovation council

Customer-FocusedPortfolio Execution

− Execution of strategic bets− M&A and licensing execution

− Support projects Darwin & Care − Develop Roadmap for BP Integration in Merger Management− Expand OpEx deployment across business processes

Capitalize on Emerging Markets

Opportunities

− Continue to grow above market− Accelerate investment opportunities to win

− Execute on Project Amazon (Russia & Brazil)− Support Strategic integration projects− Support C&RM project needs

Drive Operational

Leverage

− Streamline and shift to lower-cost operating model

− Reduce G&A to support transformation− Revamp go-to-market model to better address

customer needs

− Achieve OpEx savings of $175MM− Expand and integrate COS 2.0− Develop COE models for Tooling, Energy, Translations & Label Printing− Develop and deploy Project Management framework and training− Drive execution on key strategic projects

Develop Talent & Culture to Drive

Innovation & Inclusion

− Tier 1 & Tier 2 Bench: 60% of slate ready-now− Improve Five Key Employee Survey Questions

YOY: All five exceed Normative Data

− Expand Continuous Improvement training and Talent Development− Expand “ Knows” and develop an external benchmarking portal− Integrate Lean Sigma training and provide flexibility in training delivery and

access


Persona/Anza Operating System

Operating System Elements

• Purpose defines the key opportunities to drive improvement, establishes the strategy and generates key linkages and communications to ensure enterprise alignment.

• Process focuses on quality and productivity improvement by embracing process analysis and process standardization to reduce non-value added activities and waste.

• People enable the cultural change of a continuous improvement organization by engaging, developing and empowering employees at all levels.

• Results drive execution, align behaviors, create value and sustain results.


Results: Metrics

11 | LS Awareness 2Hr June 2014 | Confidential

• Defining Organizational Priorities

• Aligning Resources

Purpose: Strategy

Deployment

• Quantifying the Opportunities

• Annual Deployment Plan

Process:

Value Stream Thinking

• Kaizen, Six Sigma, Problem Solving, Just-do-Its

• Countermeasures

People:

Team Engagement

Persona/Anza Operating System

Improvement in Quality and KPI

Metrics

Leadership Enables the Creation of a Continuous Improvement Culture

Continuous Improvement

Metrics & Systems

Kaizen


Kai = Change Zen = Good

• Japanese word for "improvement", or "change for the better“

• Philosophy or practices that focus upon continuous improvement of processes

Rapid improvement

30-60-90 Days!

Benefits of a Kaizen


• Provides a setting and forum for a cross functional team to collaborate and understand each others roles/contributions in the process and map out at a detailed level the process.

• Focuses on identifying wastes/opportunities in the process and solving them at their source, to change the process in a way so the waste is not repeated.

• A forum to ask “why” and explore the cause/effect underlying a particular problem to determine a root cause and identify a countermeasure to resolve the problem.

• Consensus building team approach to determine the future state.

• Collaboration among team members to identify and build an Action Plan.

Rapid improvement

30-60-90 Days!

Process: Close Loop Methodology


The main approach used in is Lean-Sigma DMAIC:

• DEFINE – Define customer requirements, business case and project

objective

• MEASURE – Measure current key process metrics

• ANALYZE – Analyze process and evaluate potential solutions

• IMPROVE – Implement selected solutions

• CONTROL – Establish systems and new process standards to sustain

gains

Leans

Initiate Project & Check Strategic

Alignment

Determine Final

Process Capability

Develop Control Strategy

Pilot & Implementation

Plan

Optimize Solutions

Identify Opportuniti

es

Identify & Eliminate Waste

Understand the Process

Evaluate Measurement

System

Establish Baseline

Capability & Update Metrics

Refine Key Metrics

Stakeholder & Customer

Requirements

Finalize Control

Systems

DMAIC Roadmap

Define

Measure

Analyze

Improve

Control

Define the

Process

Understand Root Cause (Critical X’s)

Quantify Y = f(x)


DMAIC | LS Awareness 2Hr June 2014 | Confidential 16

DEFINE

What do we want to know from the DEFINE Phase?

– How to define the scope of the project to ensure all involved understand what is included and not included in the project .

– How to identify specific metrics and goals that you want to achieve.

– How to Outline the Process & Identify who the Customers and Stakeholders are to ensure they are included in any changes. Support any communication needed to gain buy in from those identified.

– How to develop a more detailed understanding of the current process, so everyone involved understand the end to end process flow.


The charter Objective clearly states the output (Y) and the Problem Statement describes the problems but itwill NOT state solutions for the inputs (Xs -influencing factors) because you need to determine those in Measure/Analyze


Element Description Details

1. Value Stream Identify which Value Stream the kaizen event supports

2. Problem Statement

Define the specific problems observed including baseline performance

3. Objective What improvement is targeted? Describe specific metrics and goals to achieve.

4. Scope Start & end points of process to be improved

5. Benefits of improving the Value Stream

What is the business case for the Kaizen/Project?

6. Metrics

Baseline metrics and targets so that improvements can be tracked

Metric Baseline Target

Project Timing: target dates, revised dates, and actual dates for

each phase

DEFINE Phase

MEASURE Phase

ANALYZE Phase

IMPROVE Phase

CONTROL Phase

Project/Kaizen Charter Template


Element Description Details

1. Value Stream Identify which Value Stream the kaizen event supports

2. Problem Statement

Define the specific problems observed including baseline performance

3. Objective What improvement is targeted? Describe specific metrics and goals to achieve.

4. Scope Start & end points of process to be improved

5. Benefits of improving the Value Stream

What is the business case for the Kaizen/Project?

6. Metrics

Baseline metrics and targets so that improvements can be tracked

Metric Baseline Target

Voice of the Customer


The term “Voice of the Customer” (VOC) is used to describe customers’ needs and their perceptions of your product or

process.

Voice of the Business

The term “Voice of the Business” (VOB) is used to describe your business’ needs in creating the product

or executing the process.

Voice of the Process

The term “Voice of the Process” (VOP) is used to describe the current state of the process; how is the process

performing. Is it capable of meeting customer needs?

Process Mapping


• To define the process scope including start and end points, and steps included

• Visually depicts variation or complexity in the process

• May also use “swim lanes” to identify the key stakeholders involved in the process

• A foundational tool that can be used to capture process observations

• A visual tool used to define a process, current or future state

• May be used at high level or detailed level to improve process understanding

Objective or Purpose

• Process Maps may be used in various phases To Define the current state

process (Define) To Document measurements,

wastes, and rework (Measure/Analyze)

To Describe the desired future state (Improve/Control)

Function 1

Function 2

Function 3

Function 4

Resource 1

Resource

2

What is It?

When to Use It


MEASURE

What do we want to know from the MEASURE Phase?

– How to use a Data Collection Plan to Collect Data on the Y (output) and key Xs (inputs) and understand where data can collected from. Understand the need to support and drive adherence to collection plans.

– How to understand and use a measurement system to identify areas for improvement.

– How to use the data collected to explain the current state, by use of different graphical tools.


Operational Definitions


Operational Definition = a clear, understandable description of what’s to be observed and measured, so that different people taking or interpreting the data will do so consistently

An Operational Definition should address:

– How to define the measure

– What the measure includes, and what it doesn’t include

– How to take the measurement (procedure)

“Continuous” vs. Attribute” Measures

• Continuous Measures - factors that can be measured on an infinitely-divisible scale,

– e.g. weight, temperature, height, time, speed, decibels, budget-versus-actual (dollars)

– Often called “variable” measures

• Attribute Measures – everything else!– Often called “discrete” measures– Pass/Fail; Good/Bad


Data Collection Steps

1. Identify metrics and establish clear Operational Definition

2. Define stratification categories (data tags) - visualize how you may want to analyze the data

– By shift, operator, day, month, etc.

3. Create a data collection plan

– Who, what, where, when, how

4. Design the data collection form and tracking system

– Check sheets, table, concentration diagram

5. Provide training for completing the form

6. Collect the Data


Step 1 Step 2 Step 3 Step 4 Step 5 Step 6

Pareto


• The Pareto principle (also known as the 80–20 rule) states that, for many events, roughly 80% of the effects come from 20% of the causes.

• In the Measure, Analyze, or Improve phases to prioritize high impact defects, issues, or other key input categories

• To rank root causes or inputs in order of frequency

• To identify the 20% of inputs that drive 80% of the output

• To focus the team on the vital few improvement opportunities


What is It?

When to Use It

Trend Charts (Run Charts)


• A graphical tool used to display data over a time series in order to see trends

• During the measure phase to understand if your data is trending. During the improve phase to verify that you have made a trend impact.

• Allows you to see if your data shows trends

• It is useful in understanding if a particular issue you are analyzing is moving in a favorable or unfavorable direction


What is It?

When to Use It

5S


• A systematic process to produce a clean and well organized work area.

• This can be used in office, field, or production environments.

• At the beginning of all Lean Activities

• Places high value on environmental, health and safety

• Creates a smooth and efficient flow of activities

• Promotes employee satisfaction• Creates proper environment for

standard work


What is It?

When to Use It

1. Sort - remove clutter; red tag

2. Straighten - make locations for everything

3. Shine - clean, polish, paint

4. Standardize - find the best way

5. Sustain - make it work!

5S

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ANALYZE

What do we want to know from the ANALYZE Phase?

– How to identify the Wastes and non-value added activities in a process to better able the team to develop an action plan and set of improvements.

– How to understand root causes of our process problems and how to eliminate the gap between existing performance and the desired level of performance .

– How to identify goals for the Future State and close the loop from the intended objectives of the project to the detailed opportunities for improvement.


What is Value?


Value Add = Good

Non-Value Add = Bad

Business Value Add = Required

Activities that directly contribute to satisfying customer requirements. Consumers would be happy to pay for. Changes fit, form, function. Focus: Preserve and enhance!

Activities that do not directly contribute to satisfying customer requirements. The customer would not be happy to pay for. Focus: Eliminate where possible.

Business Value Added: Non value adding activities which are necessary in the current environment. (i.e. legal activities, SoX, FDA, reconciliations, approvals, inspections, etc…)Focus: Evaluate and streamline or enhance where possible.


8 Wastes

• At the start of you ANALYZE phase after you have completed measure

• A set of eight common sources of waste and non-value adding activities

• May be used to classify sources of waste observed in any process.

• To identify and classify the sources of waste observed in a process

• To develop an action plan and set of improvements to eliminate, minimize or mitigate wastes identified

When to Use It

What is It?


Root Cause Analysis

Definition:Root Cause Analysis is a step by step process of observing, investigating, analyzing and finding the true source of the problem. Preventing the recurrence of the problem happens by identifying and eliminating the Root Cause.


Root Cause Analysis is a team effort!

Tools for Problem Solving and Root Cause Analysis


Root Cause Analysis

Y Y YY

Y

MachineMachine ManpowerManpower

MethodMethod MaterialMaterial

Mother NatureMother Nature

Problem or Desired

Outcome

Problem or Desired

Outcome

MeasurementMeasurement

Gemba and Waste Walks

Visual Observations

Baseline Measures

Idea GeneratingBrainstormingAffinity DiagramFishbone Diagram

5 Why’s

Future State Goals


• This process closes the loop from the intended objectives of the project to the detailed opportunities for improvement.

• This approach also engages the entire team in reaching consensus on creating the improvement plan.

• A method used to capture specific goals to accomplish in the future state, based on the results of Define, Measure and Analyze output.

• A way to link Charter objectives, and Critical to Satisfaction measures to potential improvements.

• As you transition from the Analyze phase to the Improve phase to provide guidance on developing improvement opportunities.

When to Use It

What is It?



IMPROVE

What do we want to know from the IMPROVE Phase?

– How to develop specific solutions to implement proposed improvements.

– How to apply Lean concepts to optimize the new process by:

• Improving flow and level-load work

• Creating pull systems where needed

– How to develop a corrective final solution that and develop a pilot to test the solutions to ensure effectiveness and feasibility.

– How to implement the solution through an action plan.


Flow


• In the Improve phase to optimize the future state process and deliver efficient and effective solutions

• Used in conjunction with other Lean concepts of level-loading work and reducing set-up or change-over time

• A Lean concept to optimize the ability of materials, information, or product to move seamlessly to the customer

• To streamline the improved process• To ensure the new process maximizes

value-added activities and minimizes waste

• To define optimal information flows and minimize delays

• To minimize “batching”

When to Use It

What is It?


Pull


• In the Improve phase where conditions for flow do not exist in the Value Stream

• Material crosses different value streams

• The process can not respond well to spikes in demand

• Unreliable supplier lead-time• Supplier lead-time is greater than

customer requirements

• A Lean concept to ensure materials, information, or products are issued at the customer consumption pace.

• A means to synchronize our business with the customers’ demand

• Pull is essentially a technique to CONTROL the creation and movement of material, services and information.

When to Use It

What is It?


Push vs Pull


Push

Work/materials are passed to the next process step disregarding if they have been requested or not by the downstream process step/customer.

Pull

Work/materials are passed to the next process step only when needed, in the right quantity as requested by the customer.

Pilot Planning


• In the Improve phase to validate the impact of proposed improvements before proceeding to complete implementation

• In the Control phase to fine-tune the future state implementation

• A planning activity to define and communicate plans for a pilot phase implementation of suggested improvements

• To learn what works and what doesn’t in the proposed solution

• To identify what changes will help improve the effectiveness of the solution (“bullet-proofing”)

• Define preliminary control plans and standard work for use in pilot

• Provide training and evaluate improved process

When to Use It

What is It?



CONTROL

What do we want to know from the CONTROL Phase?

– How to document procedures and create standard work for the new process.

– How to validate improvements and process capability using Visual Management.

– How to support , encourage, and drive adherence to the action plan and standard work by all Stakeholders.

– How to communicate and recognize the successes of the team.


Standard Operating Procedures


• To ensure that all activity in a process or procedure is consistently followed (standardized) in order to ensure reduced variation and ensured quality.

• SOPs are written instructions to achieve uniformity of the performance of a specific function.

• A written document detailing all relevant steps of a process or procedure. The International Quality Standards Board (ISO) requires such written documents.

• For most processes and procedures. Always when the process or procedure is regulated.

When to Use It

What is It?


Standard Work


• To ensure that best work practices are standardized and followed by everyone thus ensuring maximum process efficiency and quality.

• To enable more effective and efficient training of new personnel

• A method of documenting best work practices. There are four steps to implementing a standard work process:

1. Identify and define the best practice, that delivers a quality result, consistently.

2. Document the activities for performing the best practice, and make it visual using combination of pictures and text

3. Place it at each work station where this process is being performed.

4. Train the employees to do the tasks as defined in the Standard Work document.

• During the improve/control phase of a project to ensure that new processes are executed properly and consistently

When to Use It

What is It?


Visual Management


• Employee involvement and motivation • Open communication • Quality and productivity improvement • Safe working environment• Faster decision process • Enables a High Performance

Organization

• Daily/Weekly/Monthly depending on need of review.

• Visual methods to convey information so it is easily accessible to those who need it

When to Use It

What is It?


Leadership Standard Work for Measurement Systems


• Provides for Routine and Continuous Improvement guidelines

• Forum for Corrective actions• A method for management that is

structured, simple and informative• Closed loop system to validate

improvements and corrective action.

• A set of guidelines and tasks for leaders to engage employees in the review of performance measures.

• Throughout your improvement efforts, as you probe for root causes to problems/defects.

When to Use It

What is It?


NEXT STEPS


Senior Leadership Next Steps

• Decision on taking the journey of LeanSigma


Sun Tzu quotes in The Art of Warfare (513BC) :

“All men can see the tactics whereby I conquer, but what

none can see is the strategy out of which victory is evolved”.


POLICY DEPLOYMENT

The development and deployment of strategy.Strategy is translated into a ‘critical fewobjectives’ which are used to align and engageresources throughout the organization inselected areas. (Do the right things.)


What is Policy Deployment

• Determine Vision and Direction• Communicate Strategy, Goals and Objectives• Identify Key Stakeholders Needs• Translate Goals Into Specific Activities• Determine Critical Organizational Issues• Target Areas for Breakthrough Improvement• Attain Organization-Wide Participation• Continuously Review Progress• Provide Feedback• Standardize Systems | LS Awareness 2Hr June 2014 | Confidential 54

How do we deploy policy?


Voice of the Customer

Voice of the Business

Voice of the Employee

Prioritize Critical Issues

Set Goals, Indicators & Targets

Charter Projects to Contribute to Goals

Use Process Management to

Identify Improvements & Maintain Gains

Management Review

How to link to Process Improvementand Process Management

• Once goals are deployed, each Business Unit is asked to contribute to meeting the goals and targets.

• Existing processes are examined to determine if each is capable of meeting desired goals.

• Improvement plans are developed for processes that are not capable of meeting deployed goals.

• Process improvement plans are resourced, implemented and reviewed against deployed goals and targets.


Summarizing Lean Six Sigma ManagementPrinciples

• Prioritizing strategic and operational objectives linked to Stakeholders (Shareholders, Customers, Employees, Suppliers)– Strategic and operational alignment (vertical alignment)

• Focusing on core processes that connect to the realization of prioritized objectives– Process management (horizontal alignment)

• Improving continuously– Plan-Do-Check-Act (PDCA) cycle

• Data-driven management also making use of experience and intuition– Decision making and action planning

• Aligning relevant systems with the desired behaviors to sustain the improvement initiative– Project management, reward & recognition, communication, management

review, performance appraisal, selection, promotion, training, management accounting, etc.


Thank You


lean_sigma_awareness

Documents

objectives ls awareness

toolsresults ls awareness

example ls awareness

deming ls awareness

lean sigma awareness

project management framework

process reliability

process variation