Lean Six Sigma Green Belt Training

Lean Six Sigma Green Belt Training

ING Business School

UNIT 3Analyze

ING Business School Ref Unit 3-1

Analyze – Learning Objectives• At the conclusion of this unit, you will be able

to:• “Peel back” the layers of the causal chain to

identify potential causes of process problems.• Complete a fishbone diagram to identify

potential root causes. • Confirm root causes with data.

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Identify Potential Causes

DEFINE MEASURE ANALYZE IMPROVE CONTROL

Identify Potential Root

Causes

Collect Data to Confirm

Root Causes

Overall objective: Identify and confirm the root causes of the revised problem statement.

Ref Unit 3-2a

Analyze – Major Activities

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Key Deliverables Commonly Used Tools List of potential root

causes (Xs) Confirmed relationship

of Xs to revised problem statement (Y)

NVA and VA Analysis Affinity Diagram Fishbone Diagram Scatter Plots Stratified Frequency

Plots Contingency Table

Ref Unit 3-2b

Analyze – Key Deliverables and Commonly Used Tools

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Causes


Root Causes

Ref Unit 3-3a


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Cause and effect analysis begins with experience‑based guesses and progresses

toward data-based proof.

Ref Unit 3-3b

Identify Potential Causes• Analysis is a search for causes • Many causes may be identified • The objective is to identify those causes that

most significantly contribute to the problem - root cause

ING Business School Ref Unit 3-4a

Process

Inputs Outputs

Suppliers Customers

Cycle Time

Cycle Time Analysis

Cycle time is the total time required to perform all process activities, including both value-add and non-value-add time.

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NETWORK WASTE

ALL WORK

AUXILIARY WORK

Eliminate Non-Value-Added Actions

Increase Value-Added Work

Minimize Non-Value-AddedBut Necessary Work

Typically 50-75% of work in

manufacturing and 60%-75% of

work in transactional

processes is non-value add.

Ref Unit 3-4b

Waste vs. WorkCycle Time Analysis


Cycle Time AnalysisLean ThinkingA. Identify wasteB. Define what is value-add and notC. Measure cycle time

(cont’d.)

ING Business School Ref Unit 3-5b

Cycle Time AnalysisSeven Types of Waste1. Processing 2. Waiting3. Motion4. Inventory5. Transportation6. Overproduction7. Correction

(cont’d.)

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Inventory

Ref Unit 3-5c

Cycle Time AnalysisProcessing Waste• Information is requested but

not actually required, e.g. application forms

• Exception processing / rework required by defects in the process

• Activities no longer needed, but still a part of the process

(cont’d.)

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Inventory

Ref Unit 3-5d

Cycle Time AnalysisWaiting Waste• Colleagues not being able to perform

work, e.g., IT system is down• Only one fax available for department –

often in use• Bottlenecks• Delays waiting for decisions to be taken

before being able to continue work

(cont’d.)

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Inventory

Ref Unit 3-5e

Cycle Time AnalysisMotion Waste• Inefficient office layout, requiring

frequent movement for colleagues to collaborate

• Redundant activities – more than one person doing the same thing

• Client files move to storage while still requiring consultation

(cont’d.)

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Inventory

Ref Unit 3-5f

Cycle Time AnalysisInventory Waste• Extra brochures are printed

‘just in case’ • Stationary is ordered annually

requiring storage space• Piles of ‘Work In Progress’ exist

between process steps• Physical files are stored on

department floor

(cont’d.)

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Inventory

Ref Unit 3-5g

Cycle Time AnalysisTransportation Waste• Unnecessary movement of

paperwork and equipment• Often linked to poor office lay-

out• Using Internal Mail / Fax to hand

over work to colleagues

(cont’d.)

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Inventory

Ref Unit 3-5h

Cycle Time AnalysisOverproduction Waste• We produce more or earlier than

required• Process output is increased to ensure

enough quality items are produced • Multiple data entries for same

information• Manual work - not taking advantage of

system capability

(cont’d.)

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Inventory

Ref Unit 3-5i

Cycle Time AnalysisCorrection Waste• Process errors are allowed to

move to the next process step without finding preventive solution

• Orders are checked 5 times before sending to customer

• All orders are checked on quality vs. sampling

(cont’d.)

ING Business School Ref Unit 3-5/6

• Do not get too hung up on what type of waste it is• Focus on finding a sustainable way to remove it

Cycle Time AnalysisValue-Added Time•Customers care about it; they are willing to pay for it

•The process activity physically changes the product/service

•Re-work is not involved; the work is done right the first time

Non-Value-Added Time•Processing •Waiting•Motion•Inventory•Transportation•Overproduction•Correction

(cont’d.)


Cycle Time AnalysisMeasuring Cycle TimeDecide whether to measure cycle time on the entire

process or a sub-processUse a flowchart/process map Develop operational definitions for the starting and

ending points of each activityDevelop consensus about what is value-added and

what is non-value-added time Create a data collection form to identify which

activities will yield the most process improvement

(cont’d.)

ING Business School Ref Unit 3-7b

Cycle Time AnalysisUseful Cycle Time Data• Estimated cost/activity – total cost, not activity-based cost• Process time – value-add time per unit• Change-over time – time required to change from one type of

product/service to another, including learning time• Queue time – time spent waiting to be processed• Takt time – the rate at which output is completed, compared to

customer demand • Complexity – the number of different products/services

processed at the activity • Uptime – time worked per day minus breaks and interruptions • Defects and rework – time needed to correct defective

products/services

(cont’d.)

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Credit Voucher Turnaround Time

Process Step Value-Add Time

Non-Value-Add

TimeTotal Step

Time Notes

1. Customer Service prepares voucher

5 min 5 min 10 min Data reentered into system

2. Receiving clerk logs voucher 5 min 5 min Logging is not

necessary

3. Accounting clerk reviews voucher

10 min 10 minForm should be filled out correctly and not require review

All additional process steps, time, and notes are included here

Total Process Time

Ref Unit 3-8

Cycle Time Data CollectionCycle Time Analysis (cont’d.)

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Identify cycle time waste in your process.

Ref Unit 3-9

Activity



• Gather Many Causes• Use data from Measure Step• Talk with people • Focus on what you know • Think about sources of variation – people,

materials, methods, equipment, environment• Review past records

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Brainstorming

Ref Unit 3-11


• Brainstorming approaches

• Brainstorming guidelines

(cont’d.)

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Causes


Root Causes

Ref Unit 3-12a


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The search for potential causes evolves to a selection of those causes most likely to be the reason for the revised problem statement.

Ref Unit 3-12b

Identify Potential Root Causes

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Cause and Effect Analysis

Ref Unit 3-12c

77% non-ME cases not issued on time involved missing or unclear information on the policy application

People

MethodsEnvironment

EquipmentBranch clerk

Underwriter

Forget

to sca

n imag

e

No follo

w-up/no

t eno

ugh f

ollow-up

Heavy workloadDelivery delay Twice requirement

Avoidable requirement

Agent

slow to

respo

nd

Agents

not n

otifie

d on t

ime

System

error

Agents

can o

nly ge

t requ

iremen

t in br

anch

office

Underw

riter

AgentReq

uirem

ent e

xpired

after

dead

line

Delaye

d rece

ipt/re

ply to

requ

iremen

t

Not aware of requirement

Incon

venie

nt

Requir

emen

t can o

nly be

print

ed in

home o

ffice

Training

Red words are actionable root causes

Inconvenient

Identify Potential Root Causes (cont’d.)

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Revised Problem

Statement

Major Bone Major Bone

Major BoneMajor Bone

1st Level Cause1st Level Cause

1st Level Cause

1st Level Cause

1st Level Cause

3rd Level

3rd Level

3rd Level

4 th Level

5th Le

vel

2 nd Level

2 nd Level

2nd Le

vel

2nd Le

vel

2nd Le

vel

2 nd Level

May be more than one

Review for Continuity

Fishbone Diagram

Ref Unit 3-15



Identify Potential Root CausesAffinity Cluster Approach• Brainstorm possible causes for problem

statement• Arrange causes into affinity clusters• Label each cluster• Expand causal levels for each major bone

(cont’d.)

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Fish boning tip:

Write the causes on post-it notes as you identify them. This facilitates moving them around.

Ref Unit 3-17

Identify Potential Root CausesAffinity Cluster Approach (cont’d.)• Brainstorm possible causes for the

problem statement.

Focus on the problem statement developed in the Measure step and brainstorm causes for it to occur.

(cont’d.)


Identify Potential Root CausesAffinity Cluster Approach (cont’d.)• Arrange possible causes into affinity clusters.

Clarify the meaning Sort into clusters according to affinity. Adding new items is okay, as is editing. If a cause seems to fit into two different clusters,

make another post-it note and place one in each cluster.

(cont’d.)

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Data entry error

No system supportNot familiar with rules

Documents not checked

Process not well defined

Different operating systems in use

Manual calculations required

Short-sighted planning for new product

Applicable rules must be checked manually

New product launch was expedited

Conversion form delayed

Applicable rules must be checked manually

System support not available at this time

1. Data entry error2. Not familiar with rules3. No system support4. Inefficient scanner5. Documents not checked6. Operations delays

7. Process not well defined8. Different operating systems in use9. Manual calculations required10. Short-sighted planning for new product 11. Applicable rules must be checked manually12. New product launch was expedited

Brainstorm list

Operations delays AffinityClusters

Edited

Duplicated

Inefficient scanner

Ref Unit 3-18b

Example


Identify Potential Root CausesAffinity Cluster Approach (cont’d.)• Label each cluster.

Focus on one cluster. Discuss what the listed causes have in common. Agree on a name for that cluster. Draw a main bone and label it with cluster name.

(cont’d.)

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AffinityClusters

Inefficient scanner

Data entry error

Not familiar with rulesDocuments not checked

Manual calculations required

Applicable rules must be checked manuallyOperations delays

People

Different operating systems in use

Applicable rules must be checked manuallySystem support not available at this time

Systems

Process not well defined

Short-sighted planning for new productNew product launch was expedited

Conversion form delayed

New Product Launch Process

Add to fishbone where appropriate

Turnaround time for 83% of XYZ product clean cases exceeds seven working days

People


Systems

Ref Unit 3-19b

Example



Affinity Cluster Approach (cont’d.)• Expand causal levels for each major bone. Use the causes listed in each cluster. Write new ideas on post-it notes. Modify wording/placement of causes. Continue with all major bones in same manner. Check for continuity – Ask, “Does this level cause

effect this other level cause?” You should be able to answer yes at each level.

(cont’d.)

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Turnaround time for 83% of XYZ product clean cases exceeds seven working days

People


Systems

Operations delays

Manua

l calc

ulatio

ns re

quire

d

Rules checked manually

Data entry errorNot familiar w/rules

Not familiar w/rules

Docs not checked

From affinity cluster –shown with cause/effect

relationship

From affinity cluster –shown with cause/effect

relationship

Continue by asking, “Why are docs not checked?”

Ref Unit 3-20b

Example

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Ask Why 5 Times• Ask, “Why does this (cause) happen?”

• Keep asking until answers are not actionable.

1. Why are 84% of Proposals not sent on time?Answer: Sales Rep. doesn’t make decision in time.

2. Why isn’t decision made in time? Answer: Sales Rep. busy researching to prepare response.

3. Why is Sales Rep. busy researching?Answer: Uncertain about products, services, & pricing.

4. Why is Sales Rep. uncertain?Answer: Does not always have new product information.

5. Why doesn’t Sales Reps. have information needed?Answer: Didn’t know information was needed.

84% of proposals not prepared on time for manager’s approval

involve delays.

1. Cause

2. Cause

3. Cause

4. Cause

5. Cause

Ref Unit 3-21




Select Root Causes of Revised Problem Statement

• Usually the source of other causes.• Occurs several times during analysis.• Is not a symptom.• Trust instincts.• May be more than one root cause.• Focus on causes you can measure/control.

(cont’d.)

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Practice fishbone diagram.

Ref Unit 3-23

Activity

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Causes


Root Causes

Ref Unit 3-24

Analysis – Major Activities


Collect Data to Confirm Root Cause

Testing Theory with Data• The data collected in the Measure step may help.• Collect new data if existing data does not confirm

your theory.• Use “paired data” to enable comparison between the

potential root cause and the problem statement (effect).

• If a positive relationship exists between occurrences of the potential root causes and changes in the problem statement data, your theory is confirmed – you have found a root cause.

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Theory:The more time spent on the phone with the customer, the larger the saleX = Amount of time spent with

customer Y = $ amount of purchase

Theory:The more time spent with a customer, the more likely it is we will make a saleX = How much time spent with

customer Y = Make the sale? (Yes/No)

Theory: The higher the level of approval needed, the longer it takes to close the saleX = Level of approval neededY = Time to close sale

Theory: Experienced sales staff will sell more types of products than inexperienced sales staff X = Experience level of

salesperson Y = Types of products sold

(Effect data, Y)

(Cau

se d

ata,

X)

Cause Data, XEff

ect D

ata,

Y

Ref Unit 3-25b

Collect Data to Confirm Root Cause(cont’d.)

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Con

tinuo

usD

iscr

ete

Contingency Table

Scatter Plot

4 11

19 22

Present Not Present

Yes

No

Sub Cause

Def

ect P

rese

nt

Stratified Frequency Plots

Ya

Yb

X Data

X C

ause

Dat

aContinuous Discrete

“Y” Effect Data


X1

X2

X3

Y Data

AttributeA

ttrib

ute

Cause Data, XEff

ect D

ata,

Y

Ya

Yb

X1

X2

X3YData

XData

Ref Unit 3-26

Collect Data to Confirm Root Cause(cont’d.)

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Scatter plots clarify the relationship between two variables. They help you:

Discover whether two variables are related

Find out if changes in one variable are associated with changes in the other

When both cause and effect data are continuous

Time Spent with Customer (X cause)

Sale

Am

ount

(Y e

ffect

)

Note: Finding a relationship does not always imply causation

Ref Unit 3-27

Scatter PlotsCollect Data to Confirm Root Cause

(cont’d.)

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Positive Correlation

Negative Correlation

Possible Positive

Correlation

Possible Negative

Correlation

No Correlation

Ref Unit 3-29

Scatter PlotsCollect Data to Confirm Root Cause

(cont’d.)

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Theory: Variation in training, technique, and procedures at different locations accounts for how long it takes to complete insurance applicationData: Measure time needed to complete application at different locations

8 9 10 11 12 13 14 15 16 17 18 19 20 21

Minutes

7 8 9 10 11 12 13 14 15 16 17 18 19 20 21

7 8 9 10 11 12 13 14 15 16 17 18 19 20 21

7 8 9 10 11 12 13 14 15 16 17 18 19 20 21

Location C

Time to Complete Application(all locations)

Location B

Location A

7

Attribute causal data; Continuous problem data

Ref Unit 3-30a

Stratified Frequency Plots (cont’d.)Collect Data to Confirm Root Cause

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Continuous causal data; Attribute problem data

Theory: More time spent with a customer, the more likely to make a saleData: Measure time spent with customer and separate into two categories:

Time With Customer(in minutes)

Made the Sale

Did Not Make the

Sale

5 10 15 20 25 30 35 40 45 50 55 60 >60

5 10 15 20 25 30 35 40 45 50 55 60 >60


Made sale Did not make sale

Ref Unit 3-30b

Stratified Frequency PlotsCollect Data to Confirm Root Cause

(cont’d.)

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Attribute causal data (x); Attribute problem data (y)

Present

Present

Not Present

77

11

23

89

“Y” Defect:Data errors

A root cause!

“X” Cause: Poor Legibility

n = 200

Not Present

Ref Unit 3-32

Contingency TablesCollect Data to Confirm Root Cause

(cont’d.)

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PotentialRoot Causes

Contribution to the Problem

A 85%B 10%C 0%

Ref Unit 3-34

Collect Data to Confirm Root Cause

More Than One Root Cause• What does the data tell you about the

contribution each makes to the problem?• Select confirmed root causes that have the

greatest impact on the problem statement to conserve resources.

(cont’d.)

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Create a fishbone diagram for your revised problem statement; Identify potential root causes; Plan how to

confirm root causes with data. Ref Unit 3-35

Activity


Analyze Tollgate Questions1. What process deficiencies produce wasted

cycle time in your process? Why?2. What potential root causes were identified?

How?3. How do you know whether one root cause

has greater impact than another?4. How was root cause verification

demonstrated?


Unit Summary

1. What are the three tests to determine if a process activity is Value-Add?

2. How does cause and effect analysis “peel back” the layers of the causal chain to uncover potential root causes of process problems?

3. What are the components of a fishbone diagram?

4. What is involved when confirming suspected root causes?

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Customer Customer

Identify Value Added & Non-Value Added Steps

Brainstorm and Organize Potential Causes

Confirm Root Causes with Data

Overall objective: Identify and confirm the root causes of the problem statement.

To Improve

Step

Scatter Plots

Y

X

Contingency TableSub CauseYes No

Present

NotPresent

Def

ect

55

55

Made the Sale

Did Not Make the Sale

Time With Customer

(in minutes)

5 10 15 20 25 30 3 5 40 45 50 55 60 >60

5 10 15 20 25 30 3 5 40 45 50 55 60 >60

Made the Sale

Did Not Make the Sale

5 10 15 20 25 30 3 5 40 45 50 55 60 >60

5 10 15 20 25 30 3 5 40 45 50 55 60 >60


5 10 15 20 25 30 3 5 40 45 50 55 60 >605 10 15 20 25 30 3 5 40 45 50 55 60 >60

5 10 15 20 25 30 3 5 40 45 50 55 60 >605 10 15 20 25 30 3 5 40 45 50 55 60 >60


From Measure Step

RootCause

1

RootCause

2

Level 1 CauseLevel 2 Cause

Cause and Effect Diagram

Revised Problem

Statement Level 1 Cause

Level 1 Cause

Level 2 Cause

Level 2 Cause

Level 3 Cause

Level 1 Cause

Level 1 Cause

Level 2 Cause

Continuous Data

Mixed Data

Attribute Data

Ref 3-37b

Project Components: ANALYZE

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