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Lean Six Sigma Management Orientation

Linda Lyons –Director, Center for University Learning & KSU’s Customer Service Champion

Victor Kane – KSU Associate Professor Department of Mathematics and Statistics

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Orientation Overview

• Customer Service Initiative• What is Lean Six Sigma?• Origin of Lean Six Sigma• Employee Training • Project Essentials• Supervisor’s Role for Successful Projects• Process Improvement Organizational Model• Quality Awards Focused on Process Improvement

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Customer Service State Initiative

In 2006, Governor Sonny Perdue launched the “Customer Service Improvement” initiative to assist in achieving the goal of making Georgia the best-managed state in the country.

It was the Governor’s desire that this initiative serve as both a catalyst and a vehicle to create a change in our culture towards providing better customer service across all areas of service in the state.

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The Governor’s initiative is anchored in five commitments to our customers:

HelpfulCourteousAccessibleResponsiveKnowledgeable

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• In coordination with the Governor's Customer Service Initiative, Chancellor Davis mandated that every USG campus is to implement a plan for improving customer service.

• Each institution has Customer Service Champion to manage/promote the Governor’s initiative.

• Plans are developed each FY with identified units.

• Outline clear and measurable ways to track the campus' progress toward improved customer service.

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BOR’S STRATEGIC PLAN: Goal Six: Increase efficiency, working as a SystemChallenge:The USG will implement systematic process improvement efforts across the campuses in order to promote effectiveness.

Action:Establish a process improvement initiative

Activities for Implementation:• Implement a Lean Six Sigma training program• Implement process improvement efforts.

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KSU Customer Service Mission

Kennesaw State University is dedicated to providing top customer service to our students and other KSU

constituents by diligently listening to our customers’ concerns, being proficient and knowledgeable in our

job duties, and demonstrating a willingness to go above the customers’ expectations when addressing

customers’ issues and interests.

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KSU Customer Service Initiative

KSU-focused programs and activities include:Customer Service Improvement Program - LSSCustomer Service Training/Certificate ProgramCustomer Service CouncilCustomer Service Inspector Program (CSI)Shining Star Award ProgramChancellors/ Governors Award Program NominationsAnnual KSU Customer Service Recognition Luncheon

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KSU Unit Participation

The following units at Kennesaw have participated in the CS Improvement Program:

The Office of Student Financial Aid – FY “07 “, “09”, “10”Business Services and KSU Bookstore – FY “08”Continuing Education – FY “09”Plant Operations/ Facilities - FY “10”Office of the Registrar - FY “10”

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KSU Awards/Recognitions

The following units at Kennesaw have participated in the CS Improvement Program:

The Office of Student Financial Aid – FY “07 “, “09”, “10”Business Services and KSU Bookstore – FY “08”Continuing Education – FY “09”Plant Operations/ Facilities - FY “10”Office of the Registrar - FY “10”

Chancellor’s Customer Service Awards 2007

Outstanding Customer Service Institution of the Year Outstanding Customer Service Leadership Gold Award – Linda Lyons Outstanding Customer Service Improvement Gold Award – Coles College of Business Outstanding Customer Service Improvement Silver Award – New Hires Online Project

2008 Outstanding Customer Service Institution of the Year Joseph Greene Champion of the Year Award – Linda Lyons Outstanding Customer Service Improvement Bronze Award – KSU Bookstore Outstanding Customer Service Individual Bronze Award – Dr. Charles Aust Outstanding Customer Service Team Bronze Award – Enrollment Services Communication Center

2009 Outstanding Customer Service Leadership Award - Honorable Mention – Kim West, KSU Registrar Outstanding Customer Service Team Gold Award – KSU’s Customer Service Council

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KSU Awards/Recognitions

The following units at Kennesaw have participated in the CS Improvement Program:

The Office of Student Financial Aid – FY “07 “, “09”, “10”Business Services and KSU Bookstore – FY “08”Continuing Education – FY “09”Plant Operations/ Facilities - FY “10”Office of the Registrar - FY “10”

Chancellor’s Customer Service Awards 2007

Outstanding Customer Service Institution of the Year Outstanding Customer Service Leadership Gold Award – Linda Lyons Outstanding Customer Service Improvement Gold Award – Coles College of Business Outstanding Customer Service Improvement Silver Award – New Hires Online Project

2008 Outstanding Customer Service Institution of the Year Joseph Greene Champion of the Year Award – Linda Lyons Outstanding Customer Service Improvement Bronze Award – KSU Bookstore Outstanding Customer Service Individual Bronze Award – Dr. Charles Aust Outstanding Customer Service Team Bronze Award – Enrollment Services Communication Center

2009 Outstanding Customer Service Leadership Award - Honorable Mention – Kim West, KSU Registrar Outstanding Customer Service Team Gold Award – KSU’s Customer Service Council

Governor’s Commendation for Customer Service Excellence 2008

Kennesaw State University Linda Lyons, Director, Center for University Learning The Office of Student Financial Aid

2009 Linda Lyons, ,Director, Center for University Learning Dr. Theresa Johnston, Director of Collegiate Recovery Center

2010 Dr. Michael Sanseviro, Interim Dean, Student Success and Director of Residence Life

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QUESTIONS?

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What is Lean Six Sigma?

• Definition – Lean Six Sigma is an improvement methodology for reducing cost through improving products and services related to customer satisfaction.

• Observation – the methodology used in Lean Six Sigma is not new, but a disciplined evolution of approaches used in Quality Control during the 20th century.

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Why Consider Lean Six Sigma?

• Jack Welch – CEO GE (1981-2001) http://www.youtube.com/watch?v=aNMULFcLuIM

“I see a Six Sigma company as a company whose management understands that variation is evil….”

• Ewy and Gmitro (2009) “Process Management in Education”

http://www.asq.org/quality-press/display-item/index.pl?item=E1352

“Six Sigma is a process improvement methodology used by process managers to create breakthrough improvements.”

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Origin of Lean Six SigmaStart Year Author(s) Label Unique Characteristics

1920s Shewhart SPC Process Monitoring by Statistical Process Control 1926+ Juran Top management is responsible for quality, improvement

projects, Pareto principle, etc. 1947+ Deming 14

Points Many lectures in Japan addressing: 1) management responsibility 2) understanding variation

1949 Ohno TPS Toyota Production System (forerunner of Lean); uses Kaizen teams, JIT inventory, flows, waste elimination & cycle time reduction

1950+ Taguchi Robust Design

Developed methods to make product and process designs more robust to outside influences.

1950 JUSE Deming Prize

Award for best quality companies; Administered by Japanese Union of Scientists and Engineers

1951 Figenbaum TQC Total Quality Control: uses company-wide approach of methods from Deming, Juran, Cosby & Ishikawa

Six Sigma Tool/Process Lean Six Sigma Tools/Process

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Six Sigma BeginsStart Year Author(s) Label Unique Characteristics 1962 Ishikawa QC

Circles Quality Control Circles in Japan – employee groups working on improvements using 7 statistical tools

1979 Crosby Quality is Free book established concepts zero defects goal & cost of nonconformance is large

1980 NBC White Paper

Television documentary “If Japan Can, Why Can’t We?” featured Deming and launched American quality revolution. Many Deming lectures followed. http://www.youtube.com/watch?v=GHvnIm9UEoQ

1984 U.S. Navy TQM Total Quality Management company-wide approach to quality: uses Deming, Juran, Crosby & Ishikawa ideas. Based on many TQC principles. http://www.youtube.com/watch?v=Pd_uRGy5RKY

1987 Bill Smith Six Sigma

Motorola CEO Bob Galvin launches Six Sigma program. DMAIC problem solving addressing defects and variability using projects involving small teams focusing on internal processes http://www.youtube.com/watch?v=UxCeeUqrfs4

Video Links: 1) http://www.youtube.com/watch?v=GHvnIm9UEoQ 2) http://www.youtube.com/watch?v=Pd_uRGy5RKY 3) http://www.youtube.com/watch?v=UxCeeUqrfs4

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Lean Six Sigma BeginsStart Year Author(s) Label Unique Characteristics 1988 Motorola wins MBNQA 1988 Krafcik Lean Sloan article “Triumph of the Lean Production System” based on

TPS principles. http://www.youtube.com/watch?v=PQspf3q12mo

1993 Allied Signal (Honeywell) CEO Larry Bossidy launches SS program 1996 GE CEO Jack Welch launches SS program Mid

1990+ Lean

Six Sigma

Companies such as Allied Signal and Maytag combined two improvement approaches TPS and Six Sigma.

1999 NIST MBNQA added Education and Health Care categories 2001 U. of WI

Stout Wins MBNQA in Education Category, graduate (8,000 students)

http://www.baldrige.nist.gov/PDF_files/UWStout_Application_Summary.pdf

2005 Richland College

Wins MBNQA in Education Category, 2 year (3500 students) http://www.baldrige.nist.gov/PDF_files/Richland_College_Application_Summary.pdf

Links: 1) http://www.youtube.com/watch?v=PQspf3q12mo 2) http://www.baldrige.nist.gov/PDF_files/UWStout_Application_Summary.pdf 3) http://www.baldrige.nist.gov/PDF_files/Richland_College_Application_Summary.pdf

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Key Elements of Lean Six Sigma

1) Cost and Service Improvement Focus2) Process Based Analysis with DMAIC 3) Project Based Organization4) Team Oriented with Employee Training Levels• White, Yellow, Green, Black Belt• Master Black Belt, Champion

4) Data Driven with Key Measures Defined5) Customer Satisfaction Measures

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Key Lean Six Sigma Tools

1) DMAIC Problem Solving ProcessDefine→Measure⇄Analyze→Improve→Control2) Data Analysis (7 basic statistical tools)3) Process Mapping with Flows of Everything4) Process Monitoring and Capability5) Team Discussion Methods (7 team tools)6) Many Statistical Methods7) Lean flow and Cycle Time Focus

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Six Sigma Assumptions

• All work is accomplished using a process.• Every process has inputs (X’s) with outputs

(Y’s) which relate to customer satisfaction.• Every process has value-added activities that

transform X’s to Y’s. The goal of a project is to discover the critical X’s and optimize them to obtain the best level of Y’s.

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Process Flowchart Basics• Six Sigma principle: All work in an organization is performed in

a process. See video: http://www.youtube.com/watch?v=J6Aqg7CKRa8

• Consequence: After defining targeted measures to improve, the first step in improvement is detailed definition of processes.

Start

InputsData or Information

Value-Added Activity - 1

MCustomer

Satisfaction

M=MeasuresProcess performance metricsCounts, times, measures

Value-Added Activity – 2A Outputs End

Value-Added Activity – 2B

Customer Use

MM

M

M

AlternatePath

Step 1Correct

?Y

Rework

M

M

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Process Map ExamplePurchase Balsa

Airplane

Unwrap package without damaging any part.

Find Possible Sources of

Different Brand ofBalsa Airplanes

Inventory Parts per Instructions orSelf-Developed

Checklist

Checklist of Parts

All Parts Present?N

Assemble Tail Wing and Rudder

Y

Assemble Main Wing

X1=Fuselage

Weight KIV

Test Flight ok?

N

End

KIV'sX2=Main Wing Center PositionX3=Tail Wing Center PositionX4=Distance from Nose to Front of Main WingX5=Total Assembled Weight

Measure Y1=Distance

Y2=TimeY

CTQ Variables in Bold

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Common Six Sigma Metrics

1) Defects per Time Period ( Items not correct the first time)2) First Time Through - % of products/services with no changes,

adjustments, etc.3) Rework - % of units in that require some change4) Cycle Time – time required to complete a process5) Wait Time – time customer waits for service6) Yield – number units entering process versus number exiting

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Lean Six Sigma Improvement Strategies

1) Defect Focus – what is not done right the first time?2) Process Definition Analysis and Simplification3) Find and Optimize Process Key Measures that

impact defects & customer satisfaction. Reduce variation. Cost improvement is an outcome.

4) Rationalize Flows of Material & Information (Lean)5) Standardize Work Methods (Lean)6) Error Proof Process Steps 7) Benchmark Similar Processes

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KSU Training for CSI

• White Belt (6 hours)

Identifying Improvement Opportunities Using Lean Six Sigma (DMAIC) Variability Reduction Identifying Customers Teamwork Essentials

• Yellow Belt (18 hours)

Business Process Reengineering DMAIC Phases Simple Statistical Tools

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CSI Learning to Date

• Defining a useful project is the most important step in DMAIC.

• A process map can be difficult when processes are not systematically defined.

• Data in a usable form is usually not available on how a process is performing.

• Trained personnel cannot work in a vacuum and be successful. They will need team member support.

• Periodic supervisor updates are motivating.

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Project Essentials

•Define is the first step in DMAIC. This is the most difficult phase. It is said that a “Well defined problem is half solved”.• To assist in project definition a Project Charter can be used. Template:

http://www.6sigma.us/user/Six%20Sigma%20Project%20Charter%20Template%20v1.doc

• Key elements to start a project definition:1) Practical problem description and measures2) Objective – What does success look like?3) Scope with organizational boundaries4) Time commitment authorized for each team member5) Schedule for updates

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Supervisory Roles

1) Select Right People for Training2) Identify Area Needing Improvement3) Brainstorm Key Measures (e.g., processing time,

rework time, number of complaints/calls, etc.)4) Review Team Membership to Ensure Needed

Skills and Interfaces are Represented.5) Set Boundaries for Project Activity6) Brainstorm Benchmarking Opportunities7) Meet with Team Periodically

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Organizational Perspective

• What is the “Big Picture”?• What are interrelationships?

Process Management Improvement System – DMAICTeam-Based Improvement StrategyData Based Key MeasuresCustomer Focus, etc.

• Is there a model to represent how the entire organization might function?

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1Leadership

2Strategic Planning

3Customer

and Market Focus

6 Process

Management

5 Human Resource

Focus

7Organizational

Results

4Measurement, Analysis, and Knowledge Management

Organizational Profile:Environment, Relationships, and Challenges

Criteria Framework: A Systems Perspective

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Historical Perspective

o Baldrige established in 1987 to recognize U.S. organizations for quality and performance achievements

o Established as a diagnostic tool for self- and third-party assessments

o 70+ nations have Baldrige-based award processeso 40 states have Baldrige-based award processeso Initial focus was on the manufacturing industryo Currently many sectors: business, industry, government,

EDUCATION, healthcare, and nonprofito Video: http://www.baldrige.nist.gov/Video/Getting_Results/index.html

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Baldrige Education Winners

• Baldrige has adapted Performance Criteria to education. http://www.quality.nist.gov/Education_Criteria.htm

• U. Of Wisconsin – Stout : Wins MBNQA (2001) , graduate (8,000 students)

http://www.baldrige.nist.gov/PDF_files/UWStout_Application_Summary.pdf

• Richland College – Dallas, Texas: Wins MBNQA (2005), 2 year (3500 students)

http://www.baldrige.nist.gov/PDF_files/Richland_College_Application_Summary.pdf

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Baldrige and Lean Six Sigma

It must be emphasized that NO specific process improvement system is required by Baldrige criteria. A relevant criteria question is:

6.2 Work Processes: How do you design, manage, and improve your key organizational work processes?

Note 2 states: “… your organization might implement approaches such as PDCA…ISO standards, Six Sigma, or Lean….”

Application of criteria to smaller organizations requires flexibility.

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Baldrige Validated Criteria- 89 QuestionsSome Validation Evidence

• Benefits compared to social cost exceed 207:1 - A. N. Link and J.T. Scott (2006) , “An Economic Evaluation of the Baldrige National Quality Program,” Economics of Innovation and New Technology, 15, 83-100.

• Award winners significantly outperformed control group (38-46%) – K. B. Hendricks and V. R. Singhal (2001), “The Long-Run Stock Price Performance of Firms with Effective TQM Programs,” Management Sciences, 47, 359-368.

• Award winners outperformed control group on operating income (48%) - K. B. Hendricks and V. R. Singhal (1997), “Does Implementing an Effective TQM Program Actually Improve Operating Performance? …,” Management Sciences, 43, 1258-1274.

• Baldrige winners were better than control group by a factor of 2 on key financial measures.- K. B. Hendricks and V. R. Singhal (1999), “The Financial Rewards from TQM,” American Ceramic Society Bulletin, 78, 89-93.

• TQM and superior financial results were found to covary. K. M. York and C. E. Miree (2004), “Causation or Covariation: an Empirical Re-examination of the Link Between TQM and Financial Performance,” Journal of Operations Management 22 (2004) 291–311

• 1994-2003 award recipients underperformed S&P 500 by -18% to +36% from announcement date to December 2004. MBNQA Website.

• Up to 2001 Award winners beat S&P 500 returns by 300-600% (8 years), This trend was reversed in 2002 and 2003, the last years studied. http://baldrige.nist.gov/Stock_Studies.htm.

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Summary – Performance Excellence and Lean Six Sigma

• Jim Collins in Good to Great (2001) analyzes 11 great companies selected based on stock performance. His team found 6 concepts that made them unique. One concept “a culture of discipline” describes several Baldrige/TQM-like characteristics.

• Clearly, there is no agreement on everything organizations should do to achieve Greatness or Performance Excellence.

• Criteria have slight annual changes to reflect best practices. Inputs vary- Enron Scandal (2001): Ethical Behavior in Leadership- Hurricane Katrina (2005): Disaster Planning

• Some common themes related to Lean Six Sigma in most approaches are:- Customer Focused Products and Services- Process Model for Value-Added Work Activity- Continuous Improvement of Processes- Data-Based Decision Making

• Lean Six Sigma is a useful approach that supports most models for superior organizational performance.

What is Georgia Oglethorpe Award Process, Inc.?• Public-private partnership (1997)

Mission – Leading Georgia’s Organizations

to Improve Performance

Vision – Georgia Outperforming the World!• Modeled after the Malcolm Baldrige National Quality Award Criteria and Award Process

http://www.georgiaoglethorpe.org/

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Georgia Focus Recognition

Step 1

Georgia Progress Award

Step 2

Georgia Oglethorpe Award

Step 3

Three Step Process

Maturity andRecognitionOptions

Baldrige Award(For those eligible.)

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Thank You!!

May your processes be productive and satisfy your customers….