1
Today’s Speaker
Carl Lefever, Principal Consultant, Improve & Grow, LLC
• Certified Lean Six Sigma Master Black Belt
• Personally completed 100+ projects
• Mentored 50+ project managers
• Practical, hands-on approach
2
Learning Objectives
• Obtain a working understanding of Lean Six Sigma
• Comprehend daily work as a process-oriented activity
• Understand how your role & process fits within the larger
context of providing value to your customers
• Support & perform process improvement activities
3
Lean Six Sigma Overview Agenda
• Business Case for Lean Six Sigma
• Origins & Focus of Lean Enterprise
• Origins & Focus of Six Sigma
• Lean Six Sigma Approach
• Lean Six Sigma Methodology & Tools
4
What is Process Improvement?
Process
• taking anything we do…
Improvement
• and finding ways to do them simpler, faster, better…together
Process
Inp
ut(
s)
Ou
tpu
t(s
)
entering customer orders
manufacturing process
processing claims
creating a forecast
giving feedback to employees
increase order entry accuracy
reduce color variation
reduce lead time
reduce estimate variance
improve feedback effectiveness
5
Process: “A series of steps leading to a desired outcome”
Process Thinking:
Inputs: Outputs:
Management Control
Prepare
Quote
Approve
Price
Issue quote
& close
Setup
Cust. In DBIssue
PO
Tasks:
Task Thinking:Prepare
Quote
Approve
Price
Setup
Cust. In DB
Issue quote
and close
Issue
POSales Dept.
Accounting Dept.
What is a Process?
6
The Hidden FactoryWork Arounds
Op i Op i + 1
Analysis ScrapOff-Line
Correction
Correctable
?
Verified
?
NoYes
Quick FixesInspections
Scrap
Rework
Extra EquipmentIncreased Inventory
Increased Cycle Time
Frustration
Defects
Customer Dissatisfaction
Cost
7
Tangible Quality Costs
Available or easy to measure costs from:
• Inspection
• Rework
• Warranty
• Inventory
Difficult or impossible to measure costs from:
• Lost sales
• Expediting
• Redundancies
• Late payment
• Frustrated
employees
• People & equipment idle time
• Lost customer loyalty
• Long cycle times
• More facilities
• Lost reimbursements
Intangible Quality Costs
• Obsolescence
• Scrap
• Customer complaints
• Legal
Cost of Poor Quality “Iceberg”
8
Process Improvement Fundamentals The outputs of a process are a function of the process and its’ inputs
This function can be understood by studying inputs, process and outputs
Outputs can be improved by eliminating problems in the process & inputs
Step 1 Step 2 Step 3
Results!
9
History of Formal Process Improvement Methods
Image courtesy of isixsigma.com
Lean Six Sigma
Formal improvement
methods began in early
1900’s; Lean Six Sigma is
the current expression and
combines thinking and
tools of prior approaches
10
Lean Six Sigma Approach to Process Improvement
So, what is Lean Six Sigma?
Lean Six Sigma is holistic system for process improvement that
incorporates the waste elimination focus of Lean Enterprise with
the variation reduction techniques of Six Sigma
Lean Enterprise:
The application of principles whose objective is to eliminate WASTE while
improving process flow to achieve SPEED and agility at lower COST
Six Sigma:
The application of principles whose objective is eliminate DEFECTS and
reduce VARIATION to improve process QUALITY
When combined and effectively applied, major improvements are achieved in business performance.
11
Origins & Focus of Lean
Enterprise
12
What is Lean Enterprise?
•Lean is a systematic approach to solving daily problems by reducing
or eliminating process waste (non-value-added activities)
•Non-value-added activities are best described as those tasks that add
cost or time to a process without adding value to the customer. Such
activities make up 70-95% of the average workday.
•Examples include reworking defective product, incomplete
information, waiting for materials, excessive motion, unnecessary
inventory, etc.
•Lean is a philosophy whose core goal is continuously minimizing
waste to maximize flow (it is an iterative activity)
13
Lean Enterprise Approach to Continual Improvement
1. Precisely specify the value of a specific process
2. Identify the value stream for each process
3. Allow value to flow without interruptions
4. Let the customer pull value from the process
5. Continuously pursue perfection
* Womack, J.P, and D.T. Jones, 1996, Lean Thinking, Simon & Schuster
14
Principle #1 – Specify And Focus On Value
• Any activity or task that the customer is both aware of it and willing to pay for it, is “Value-Added”
• Value added tasks:
• Are meaningful to the customer
• Physically transform the product, process or service
• Are completed correctly the first time
• A good test is “are they willing to pay for it?”
• Based on this (strict) definition of value, we can divide the tasks and activities of any process into three categories:
• Value-Added (VA
• Non-Value-Added (NVA)
• Some add “Business Required” to designate activities that are technically non-value added but are required by the business
15
Principle #2 – Identify The Value StreamThe Value Stream is the
sequence of steps that lead
from a triggering event
to a final deliverable
C/T = Calendar Time
W/T = Work Time
VA/T = Value-Added Time
16
Principle #3 – Eliminate Obstacles To Flow Of Value
Value
Wastes are any obstacle
to the continuous flow of value!
Customer
Correction & Repair
Waiting
Wasted Motion
Overproduction
Unnecessary Conveyance
Non-Value Added Processing
Idle Inventory
17
Principle #4 – Let The Customer Pull Value
Push Production System
• Batch Production
• Based on Forecasts
• Store Inventory
Downstream Effects
• Late Deliveries
• Batches of bad product
• Idle or Obsolete Inventory
Customer Customer
Pull Production System
• Just-in-Time Production
• Make to Order
• Produce When Needed
Downstream Effects
• Faster Delivery Time
• Little to no Inventory
• Lower production costs
18
Principle #5 – Continuously Pursue PerfectionRaw
Goods
Finished
Product
Sea of Inventory
Inventory allows production to “flow”, but at a tremendous increase in cost
Poor
Scheduling Inspection
& Rework
Setup
Time Communication
Problems
Poor
Service
Redundant
Steps
Raw
Goods
Finished
Product
Poor
Scheduling Inspection
& Rework
Setup
Time Communication
Problems
Poor
Service
Redundant
Steps
To improve the value stream, we must continually find and eliminate problems
19
Lean Enterprise Tools
Waste Identification Tools
• Value Stream Mapping
• Spaghetti Diagram
Waste Elimination Tools
• 5S’s – Sort, Shine, Set,
Standardize & Sustain
• Visual Workplace
• Quick Change Over (SMED)
• Total Productive Maintenance
(TPM)
Problem Solving Tools
• Kaizen Events
• Fishbone Diagram / 5 Why’s
• Standardized Work
• Mistake Proofing (Poka-Yoke)
Continuous Flow Tools
• Production Signals (Kanban)
• Load Leveling or Balancing
• Cellular Manufacturing
20
Lean Application Examples
• Used Value Stream Mapping to redesign product
development process for Chemicals company and reduce
cycle time by over 50%
• Applied 5S in Customer Service area, removing over 20
skids of material/equipment and re-organized areas into
work teams for significant workflow improvements
• Implemented Cellular Workflow in electronic document
composition process leading to over 60% reduction in
cycle time & 50% improvement in quality
• Utilized SMED techniques to reduce change over time on
a converting press, reducing setup time from 24 hours to
less than 6 hours for key product line
21
Origins & Focus of Six Sigma
22
History of Six Sigma
• Six Sigma developed in 1980’s
• Developed by two Motorola engineers
• Focused on variation to eliminate defects
• Goal was to achieve “six sigma” quality in key processes (99.99996% or 3.4 defects per million opportunities)
• Structured use of existing quality tools
• Relied on data, analysis and statistics to solve problems
• Required rigorous training & certification, like martial arts
• Six Sigma spreads to other large companies in 1990’s
• Allied Signal adopts in 1995 and gains attraction of Wall Street
• General Electric incorporates as overall corporate strategy
• Six Sigma becomes common language in 2000’s
• 1,000’s of companies adopt Six Sigma
• Universities develop formal Six Sigma programs
23
Corporate Success with Lean Six Sigma
• GE added between $7 to $10 billion in about 5
years
• DuPont added $2.4 billion to its bottom line in the
first 4 years of their Six Sigma program
• Bank of America saved hundreds of millions of
dollars in the first 3 years of their program, cut
cycle times in half and reduced processing errors
by an order of magnitude
• Honeywell achieved record operating margins and
saved more than $2 billion in direct costs
• Motorola saved $2 billion in a 4 year time frame
24
Six Sigma Core Concepts
Six Sigma is the application of scientific methods to the design and operation of business with the goal of driving improved customer, shareholder and employee value.
Six Sigma Management is:
• Customer Focused: Align processes to meet customer needs
• Data Based Decisions: make decisions based on data vs. gut feel
• Process Driven: Focus on the process not the people
• Projectized Approach: Drive improvement, one project at a time
• Root Cause: address root causes not symptoms
• Pareto Principle: Focus on critical few problems vs. trivial many
• Variation Reduction: Variation is the enemy!
25
Six Sigma Approach to Continual Improvement
1. Understanding and managing customer
requirements (Voice of the Customer)
2. Aligning business processes to meet customer
requirements (Business Process Management)
3. Rigorous analysis to minimize process variation
4. Drive rapid and sustainable improvement
26
50454035302520
Lower Spec Limit Upper Spec Limit
Process Capability of Output
#1 Understanding & Managing Customer Requirements
• “Voice of Customer” translates to Process Requirements
• “Voice of Process” translates to Process Capability
Voice of Process
Voice of Customer
Defects
Defects
27
Process Sigma Level As a Measure of Capability
Mean
USL
s, Spread
LSL
Outside of spec. limits All points in spec.
2 Sigma Process 6 Sigma Process
• Standard Deviation or Sigma
(s) is a measure of variation
from the norm (average)
• The number of standard
deviations between the
average & spec limits
equates to the capability
28
Six Sigma versus 99% Capability
US Postal Service Mail delivery
VISA Credit Card Transactions
99% = $44 Billion in transactional errors / year
6σ = $1.5 Million in transaction errors / year
99% = 20,000 articles lost /hr
6σ = 7 articles lost /hr
29
How does Quality Affect Business Performance ?
Sigma Levels & Related Reference Statistics
Company Status
Sigma
Level
% Defect
Free
Defects per
Million
Opportunities
Cost of Poor
Quality
(% Sales)
Non-Competitive 2 Sigma 65% 308,537 >40%
3 Sigma 93% 66,807 25%-40%
Industry Average 4 Sigma 99.4% 6,210 15%-25%
5 Sigma 99.976% 233 5%-15%
World Class 6 Sigma 99.9996% 3.4 <1%
30
#2 Business Process Management
Order Make Pack Ship
I
N
P
U
T
S
O
U
T
P
U
T
S
SUPPLIERS CUSTOMERS
Overall Performance Feedback &
Improvement Opportunities
Process & Customer
Knowledge
Process Monitoring &
Improvement
Process
Owners
Output
“Healthy processes serving
happy customers!”
31
The Process Transfer Function
People
Materials
Equipment
Methods
Environment
Y = ƒ (X1, X2, X3, X4,…Xn)
Outputs (Y) are a function of Inputs (X’s)
32
Identify Possible X’s…
Measure Potential X…
Isolate the Probable X’s…
Improve the Critical X’s…
8-10 x’s
30-50 x’s
4-8 x’s
2-4 x’s
#3 Rigorous Analysis of Process Variation
Control the Critical X’s…
33
DMAIC Problem Solving Methodology
• Define Problem & Establish Project GoalsDefine
• Measure Problem & Potential CausesMeasure
• Analyze to Isolate Critical Few CausesAnalyze
• Improve Critical Few CausesImprove
• Control the Critical Few to Sustain GainsControl
34
#4 Drive Rapid & Sustainable Improvement
Project
#1
Project
#2
Project
#3
Project
#4
Time
Imp
rov
em
en
t
35
Six Sigma Tools
Define
• Project Charter
• Stakeholder Analysis
• Project Plan
• Communication Plan
• Process Maps
• Voice of Customer
Measure
• Fishbone Diagram
• Cause & Effect Matrix
• Data Collection Plan
• Measurement System Analysis
• Time Series Charts
• Capability Analysis
Analyze
• Pareto Charts & Pie Charts
• Box Plots & Dot Plots
• Hypothesis Tests
• Regression Analysis
Improve
• Solution Impact Matrix
• Risk Analysis (FMEA)
• Designed Experiments
Control
• Control Plan
• Control Charts
• Mistake Proofing
• Standard Operating Procedures
36
Six Sigma Application Examples
• Used Voice of Customer analysis to identify critical product need, enabling replication of competitive product at a fraction of cost
• Isolated vendor contributing inordinate number of returns using Pareto analysis, leading to significant reduction in product returns
• Utilized Designed Experiment to identify new approach to kit assembly resulting in over 25% reduction in costs
• Utilized Regression Analysis to predict inventory need based on web inquiries, reducing inventory by over 50%
• Applied Control Chart techniques to pressroom waste and reduced paper waste by over 10%
• Used Measurement System Analysis to improve color consistency and make dramatic reduction in claims
• Used Process Maps to identify that 26 of 40 process steps were non-value added, many of which were able to be eliminated through process re-design
37
Lean Six Sigma Approach
38
Defining Lean Six Sigma
Lean Six Sigma Is...
• a management philosophy
• an improvement methodology
• a set of performance standards
Lean Six Sigma Is Not…
• A solution for every problem
• A replacement for common sense decision making
39
Lean Six Sigma Management Philosophy
Lean
Six
Sigma
Lean EnterpriseImprove process speed by
eliminating non-value added
activities in the process
Key Principles
• Define Value Streams
• Identify Non-Value Added
• Eliminate Non-Value Added
• Create Pull Production
• Continuously Pursue Perfection
Six SigmaImprove process quality by
eliminating sources of variation
in the process
Key Principles
• Define Process Problems
• Measure Process & Inputs
• Analyze Variation in Inputs
• Improve Key Process Inputs
• Control Key Process Inputs
Lean Six Sigma is holistic system for process improvement that
incorporates the waste elimination of Lean Enterprise with the
variation reduction techniques of Six Sigma
Successful application provides significant improvements in
customer satisfaction, employee engagement & shareholder value
while reducing costs and increasing revenues
40
Lean Six Sigma Improvement Methodology
Lean Tools
• Value Stream Maps
• Kaizen Events
• 5S’s
• Spaghetti Diagrams
• Total Productive
Maintenance (TPM)
• Quick Change Over
(SMED)
• Standardized Work
• Mistake Proofing (Poka-
Yoke)
• Operator Balancing
• Cellular Manufacturing
• Pull Production
• Visual Workplace
Six Sigma Tools
• Project Charter & Plan
• Voice of the Customer
• Key Performance Metrics
(KPI’s)
• Critical-to-Quality
Requirements (CTQ’s)
• Process Maps
• Cause & Effect Diagrams
• Data Collection Plans
• Measurement Analysis
• Hypothesis Tests
• Regression Analysis
• Designed Experiments
• Control Charts
• Dashboards
• Rigorous Training – All employees are trained in varying levels (Champion, Black Belts, etc.)
• Projectized Approach – Events & Projects focused on improving key value stream metrics
• Performance Based – Every project has a financial impact and key performance metrics
D
M
A
I
C
41
Lean Six Sigma Performance Metrics & Standards
• Lean Metrics
• Process Lead Time
• Operational Equipment Effectiveness
• Process Cycle Efficiency
• Six Sigma
• Rolled Throughput Yield
• Cost of Poor Quality
• Sigma Quality Level
42
Six Sigma Roles & Responsibilities
White Belts
Understand the basic
concepts and tools of
Lean Six Sigma
Yellow Belts
Understands concepts
& learns to use tools as
team member
Green Belts
Lead projects on part-
time basis within their
department
Black Belts
Lead large projects
on full time basis &
coach Green Belts
Master Black Belts
Technical experts &
trainers, coach Black
Belts & lead large,
complex initiatives
Executive Champions
Sponsor improvement
initiatives; initiate &
champion specific projects
43
Lean Six Sigma Deployment Model
• Train Organization Leaders as Executive Champions
• Conduct Strategic Project Selection & Identify Projects
• Identify & Train Project Leaders
• Form Project Team & Train Team Members
• Execute Projects & Establish Control Plans
• Repeat, Repeat, Repeat Across the Organization
• Support above with the appropriate infrastructure
• Hire/Train Lean Six Sigma Experts
• Establish Process Management Systems
• Align Performance Management Systems
44
Manufacturing Process Applications
• Improve machine throughput
• Reduce product waste
• Reduce machine setup time
• Reduce equipment downtime
• Reduce work-in-process inventory
• Improve product quality
• Reduce workplace injuries
• Reduce operations cost per unit
• Reduce energy costs
• Eliminate inspection costs
45
Transactional Process Applications
• Reduce cycle time
• Improve on-time delivery
• Reduce process defects
• Reduce customer returns
• Improve customer response time
• Improve pricing accuracy
• Reduce employee complaints
• Improve employee retention
• Reduce design cycle time
• Increase sales conversion ratio
• Improve advertising response rate
46
Lean Six Sigma Methodology &
Tools
47
Lean Six Sigma Problem Solving Roadmap
Identify
Problem &
ObjectivesDEFINE
IMPROVE
CONTROL
Document
Current
Process
Develop
Charter &
Develop Plan
Brainstorm
Potential
Solutions
Conduct
Experiments
to Test
Solutions
Implement
Verified
Solutions
Establish
Process
Control Plan
Validate
Improvements
& Controls
Document
Results &
Close Project
MEASUREDevelop Data
Collection Plan
Assess
Measurement
Systems
Establish
Baseline
Performance
ANALYZEConduct
Process
Analysis
Conduct
Graphical
Analysis
Conduct
Statistical
Analysis
48
Define PhasePurpose:
•To clarify the problem and plan for improvement
• Problem Statement
• Project Objective
• SIPOC
• Voice of the
Customer
• Stakeholder Analysis
• Project Charter
• Project Plan
• Project Metrics
Primary Tools
Identify
Problem &
ObjectivesDEFINE
Define the
Current State
Develop
Charter, Plan &
Metrics
By the end of the Define phase, you should be able to answer:
•What is the problem we need to solve and the associated costs?
•What is the project objective and related benefits to achieving it?
•What resources will be required to solve the problem?
49
Identify Problem & ObjectivesIdentify Problem Areas
for Improvement
Narrow Down to
Specific Focus Area
• Business Strategy
• Budget Goals
• Client Feedback
• Financial Metrics
Example:
• Annual product returns
cost $750,000
• Product Types
• Departments
• Customer Segments
Example:
• Assembly errors
represent $225,000 of
total returns
Develop Business
Problem Statement
• Specific metric
• Baseline performance
• Cost of problem
Example:
• In 2013, the assembly
error rate was 5% and
cost $225,000
Develop Specific
Project Objectives
• Metric goal or target
• Due date for project
• Benefits & savings
Example:
• Reduce assembly error
rate by 50% by Sept 30,
saving $100,000
50
Document Current StateHigh Level Process
Map (SIPOC)
Voice of the Customer
Analysis
Stakeholder
Assessment
51
Develop Charter, Plan & MetricsProject Charter
Project Plan
Project Dashboard
52
Measure PhasePurpose:
•To gather data on the problem and related variables
• Prioritization Matrix
• Data Collection
Plan
• Data Collection
Forms / Systems
• Variable Gage R&R
• Attribute Gage R&R
• Measurement Audit
• Time Series Chart
• Pareto Chart
• Control Chart
• Histogram
• Capability Study
Primary Tools
By the end of the Measure phase, you should be able to answer:
•What are the variables that are believed to contribute most the problem?
•How good are the data systems we use to measure the process?
•What is the current process capability vs. the process requirements?
MEASUREDevelop Data
Collection Plan
Assess
Measurement
Systems
Establish
Baseline
Performance
53
Develop Data Collection Plan
Prioritize Key Process Variables
Develop Data Collection Plan
Rating of
Importance to
Customer
7 10 6 8
No. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Process
Output
(Y)
Hot
Piz
za
Corr
ect
Ingre
die
nts
Deliv
ery
Tim
e
Pro
perly C
ooked
Total
No.
Process Input
(X)
1 Name 0 0 0 0 0
2 Address 5 0 8 0 83
3 Time 5 0 5 0 65
4 Day 4 0 5 0 58
5 Date 0 0 0 0 0
6 Phone No. 0 0 4 0 24
7 Recipe 0 10 0 4 132
8 Ingredients 4 10 0 4 160
9 Oven Temp 8 0 0 8 120
10 Cook Time 9 0 0 10 143
11 Volume 7 0 8 7 153
12 0
13 0
14 0
15 0
16 0
17 0
18 0
19 0
20 0
Total 294
200
180
264
0 0 0 0 0 0 0 0 0 0 0Measure
Prioritization
Matrix Rank
Type of
Measure Unit Defect What Where When Who
Paint Waste
(Y) Continuous Each Paint > 120%
Std gallons vs.
Actual gallons Weekly/MonthlyLetitia
Solids @ filter
press (Y) Continuous Cycle TBD Pounds/cycle Filter Press Each Cycle Environmentalists
Paint mix Continuous Batch TBD Gallons/batch Mix Bowl Each Batch Paint Mixers
L2 Reclaim
Compliance 2 Discrete Dove <100%
Compliance to
procedures Dove area Each Dove run Operators
Gram
Application 2 Continuous
Dove, Paint
booth, edge TBD Gram application
Paint Booth,
Dove, Edge Hourly Operators
Flex Edge - Continuous Flex Edge TBD L and b Flex Edge Hourly Operators
DOVE Spray 3
Distance of
gun to board 3 Continuous Dove TBD Distance Dove setup Each run Operators
Pressure (x) 3 Continuous Dove TBD pressure Dove setup Each run Operators
Angle (x) 3 Continuous Dove TBD angle Dove setup Each run Operators
# of sec on
and off (x) 3 Continuous Dove TBD time Dove setup Each run Operators
Clarify Data Collection GoalsOperational Definitions and
ProceduresCollection Plan
54
Accurate & Precise Accurate, but not Precise
Precise, but not Accurate Not Accurate, Not Precise
Assess Measurement Systems
Measurement System Analysis
• Accuracy: Bias, Linearity &
Stability
• Precision: Repeatability,
Reproducibility, Resolution or
Discrimination
Appraiser
Pe
rce
nt
321
100
90
80
70
60
50
40
95.0% C I
Percent
Appraiser
Pe
rce
nt
321
100
90
80
70
60
50
40
95.0% C I
Percent
Date of study:
Reported by:
Name of product:
Misc:
Assessment Agreement
Within Appraisers Appraiser vs Standard
55
Establish Baseline PerformanceData Stratification
Process Stability
Process Capability
C1
75706560555045
Dotplot of C1
Date
Da
ta
1/30
/200
4
1/27/200
4
1/24
/200
4
1/21
/200
4
1/18
/200
4
1/15/200
4
1/12
/200
4
1/9/20
04
1/6/20
04
1/3/20
04
19.5
19.0
18.5
18.0
17.5
17.0
16.5
16.0
Time Series Plot of Data
50454035302520
LSL USL
Process Capability of Output
Others
Cables
Filters
Pan Dum
ps
Pumping
Pot Dum
ps
EOR
4.947 16.579 85.965134.568150.789168.211378.744
0.5 1.8 9.114.316.017.940.3
100.0 99.5 97.7 88.6 74.2 58.2 40.3
900
800
700
600
500
400
300
200
100
0
100
80
60
40
20
0
Defect
CountPercentCum %
Perc
en
t
Gallon
s o
f P
ain
t
56
Analyze Phase
Purpose:
•To isolate the critical few variables for improvement
• Value Stream Map
• Cause & Effect
Diagram
• Pareto Charts
• Scatter Plots
• Box Plots
• Hypothesis Tests
• Regression Analysis
Primary Tools
By the end of the Analyze phase, you should be able to answer:
•What are the critical few variables (X’s)?
•How much of the problem do these variables account for?
ANALYZEConduct
Process
Analysis
Conduct
Graphical
Analysis
Conduct
Statistical
Analysis
57
Conduct Process Analysis
Cause & Effect Diagram & 5-Why
Analysis
Detail Process Maps and/or Value
Stream Mapping
Why?
Why?
Why?Why?
Why?
58
Box Plots
Pareto Charts
Scatter Plots
Conduct Graphical Analysis
High: 38 to 40% Std: 34 to 37%
0.9
1.0
1.1
Broke level
Densit y
Macon #3 Machine - 755 Minaboard(means are indicated by solid circles)
High: 38 to 40% Std: 34 to 37%
0.9
1.0
1.1
Broke level
Densit y
Macon #3 Machine - 755 Minaboard(means are indicated by solid circles)
Others
Cables
Filters
Pan Dum
ps
Pumping
Pot Dum
ps
EOR
4.947 16.579 85.965134.568150.789168.211378.744
0.5 1.8 9.114.316.017.940.3
100.0 99.5 97.7 88.6 74.2 58.2 40.3
900
800
700
600
500
400
300
200
100
0
100
80
60
40
20
0
Defect
CountPercentCum %
Perc
en
t
Gallon
s o
f P
ain
t
59
Conduct Statistical Analysis
Regression Analysis
Hypothesis Testing
High: 38 to 40% Std: 34 to 37%
0.9
1.0
1.1
Broke level
Densit y
Macon #3 Machine - 755 Minaboard(means are indicated by solid circles)
High: 38 to 40% Std: 34 to 37%
0.9
1.0
1.1
Broke level
Densit y
Macon #3 Machine - 755 Minaboard(means are indicated by solid circles)
Hypothesis tests are used to confirm
the significance of a given variable on
the output (ex: effect of Material A or B
on product quality levels)
Regression analysis is used to
determine the degree to which a given
variable affects the output (ex: effect
of temperature on tensile strength)
60
Improve PhasePurpose:
•Identify and implement solutions to address the critical few variables
• Brainstorming
• Solution Impact
Matrix
• Pilot Runs
• Designed
Experiments
• Risk Analysis
• Action Plans
• Communication Plan
Primary Tools
By the end of the Improve phase, you should be able to answer:
•What solutions are believed to have the most impact on the problem?
•What solutions have been proven to affect the most change?
•How can we ensure a successful implementation of the solutions?
IMPROVEBrainstorm
Potential
Solutions
Conduct
Experiments
to Test
Solutions
Implement
Verified
Solutions
61
Brainstorm Solutions
Brainstorm Solutions
Solution Impact Matrix
Idea #1
Idea #3
Idea #2
Idea #4
Idea #8 Idea #7
Idea #5
Idea #6
Idea #9
62
Pilot Runs & Designed Experiments
Brainstorming Data Analysis
Speed
Brake Lathes
Operators
Men
Machines
Materials
Methods
Engager BitsCondensation
Angle SocketsMoisture %
Suppliers TrainingInspectors
Lubricants SupervisorsMicroscopes
Alloys ShiftsMicrometers
Measurements
Environment
Speed
Brake Lathes
Operators
Men
Machines
Materials
Methods
Engager BitsCondensation
Angle SocketsMoisture %
Suppliers TrainingInspectors
Lubricants SupervisorsMicroscopes
Alloys ShiftsMicrometers
Measurements
Environment
1 Select solutions to be tested2 Identify operation conditions for
each solution to be tested
3Select & plan experiment strategy
and communicate plan to affected
parties 4 Train operators, conduct
experiments and collect data
5Analyze and
interpret the
results
63
Implementation Planning
E = Q x AEffectiveness
of Solution
Quality of
Solution
Acceptance of
Solution
Action PlansRisk Analysis Communication Plans
64
Control Phase
Purpose:
•To develop a plan to sustain the improvements made by the project
• Control Plan
• Control Charts
• Procedures
• Audit Checklists
• Mistake Proofing
• Hypothesis Testing
• Financial Analysis
• Project Report
• Closing Presentation
• Knowledge Transfer
Primary Tools
By the end of the Control phase, you should be able to answer:
•What is the plan to ensure that project gains are sustained?
•How much improvement was made and what is the impact?
•Where else can the project learning be applied in the organization?
CONTROLEstablish
Process
Control Plan
Validate
Improvements
& Controls
Document
Results &
Close Project
65
Establish Process Control PlanBusiness Dashboards
Control Plan
Control Charts
Process SOP’s,
Checklists, etc.
Visual Controls /
Mistake Proofing
28252219161310741
550
500
450
400
350
300
250
200
_X=350.2
UCL=499.9
LCL=200.5
1
66
Validate Ability to Control & Sustain Improvements
Prior to closing the project, it is critical to validate:
• Process improvements are sustained
• Control mechanisms work
• Process personnel accept changes
• Stakeholders & Customers have positive feedback
Requested On Date
In
div
idu
al
Va
lue
10/23/200609/27/200608/30/200608/10/200607/21/200607/7/200606/13/200605/30/200605/12/200605/2/200604/3/2006
200
150
100
50
0
_X=6.8
UC L=25.7
LB=0
2006 2Q 2006 3Q 2006 4Q
Requested On Date
Mo
vin
g R
an
ge
10/23/200609/27/200608/30/200608/10/200607/21/200607/7/200606/13/200605/30/200605/12/200605/2/200604/3/2006
160
120
80
40
0
UC L=23.2
LC L=0
2006 2Q 2006 3Q 2006 4Q
__MR=7.1
111
111111
1
111
1
1
111111
1
11
11
11
1
1
1
11
1111
11
1
1
111
Marketing Collateral Cycle Time for C Projects Apr - Oct 2006Baseline Period During Project Control Phase
67
Document Results & Close ProjectProject Evaluation
Did the project attain the desired results?
Have the results been sustained?
Have the savings been validated and
approved by Finance?
Project Documentation
Have all necessary procedures, audits, charts,
etc. been documented and communicated?
Have necessary project documents been
created?
Team Evaluation
Was the project completed on time on on
budget?
Did the Champion provide the right level of
support?
Did everyone on the team participate as
expected?
Key Learning
What were the key discoveries that lead to the
improvement?
What leverage opportunities exist for other
areas?
Is there any unfinished work that needs to be
monitored?
Have any new projects or opportunities been
identified?
Project Closure
Is the project approved for closure by the
Champion and sponsor?
Has a formal closure event been held with the
project team?
Has the project team been appropriately
recognized for their work?
68
LSS Case Study: Job Planning Waste Reduction
Define Phase
Analyze Phase
Improve Phase
Measure Phase Control Phase
• Press overproduction
averaged 5%, but ranged
from -50% to +62%
• 10% improvement equates
to $350,000 annual savings
in paper waste
• Print targets are determined
by historical job data & gut
feeling of job planner
• Identified over 100 potential
factors, 15 of which were
believed to be critical
0.300.250.200.150.10
30
25
20
15
10
5
0
Planned Run Waste %
Act
Ru
n w
aste
%S 3.71317
R-Sq 24.1%
R-Sq(adj) 23.6%
Regression
95% PI
Fitted Line PlotAct Run waste % = 3.841 + 55.24 Planned Run Waste %
• Isolated 7 significant
factors & developed
prediction model
• New model produces 25%
less overproduction
• Controls in place to ensure
model is updated as process
changes over time
69
LSS Case Study: Sales Quotation Win RatioDefine Phase
Analyze Phase
Improve Phase
Measure Phase Control Phase
• Sales believes that lagging
quotation cycle time is
leading to lost jobs
• Customer expectation is
found to be same to next
day turnaround on quotes
• Actual performances is
75% within 24-hr period,
goal is to improve to at least
90%
• Turnaround improves and
correlation to sales
conversion is proven!
• Value Stream Map reveals
process can take up to 48
hrs with 50% rework rate
• Team identified 79 different
non-value added activities
within the value stream
• Simple, medium & complex
product lines are created
with streamlined workflows
• Automated tools are
introduced into the process
543210
0.25
0.20
0.15
0.10
0.05
0.00
Avg Project Quote Turn Days
Prob
abili
ty o
f a
Sale
s O
rder
PredProb
ActProb
Variable
P-value = 0.00
Concordant Pairs (R-Sq) = 55.6%
Scatterplot of Probabilty of Sales Order vs. Turn Days
70
Lean Six Sigma Summary
• The need for improvement is continual and the best
companies utilize formal process improvement
approaches to stay competitive in the marketplace
• Lean Six Sigma is a holistic system for process
improvement built upon the principles and tools of time
tested methods of Lean Enterprise, Six Sigma & others
• The DMAIC problem solving methodology provides a
structured, project driven approach to continual
improvement
• The application of Lean Six Sigma results in delivery of
products and services at the highest speed and quality
levels possible while lowering cost
