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Introduction Ford and
Six Sigma
Consume DrivenSix Sigma
What it
means atFord
Communicationand Training
People andhow theymatter
Design for SixSigma @ Ford
What itmeans
Tools andTraining
Case Applicationat Ford Otosan
How theyachievedreduction
in stocks
Obstacles
Problemsthey faced
How theywentaround
Agenda
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1898- Startedas Detroit
AutomobileCompany
1905 Reached18000 cars in
an year
1911 FordMotor
Company wentoverseas
1920 millionvehicles an year
1925Factories in
many countries
2008- 5.532million vehicles
Introduction
I am willing to offer any color (for my car) as long as it is black
Fact Sheet
Introduced the world to assembly lines and mass production
Elaborate management of industrial workforce
Grew serious about customer centric six sigma after customer satisfaction
began to fade in 2000s
Changed vision of the company to incorporate the Consumer DrivenApproach
Adopted six sigma across departments in 2000
Savings of $ 2.19 billion globally
Ford India alone has saved $1.5 million in four years
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Consumer Driven Six Sigma
Must relate to customer satisfaction
Results must reduce defects by 70%
Each project should achieve average cost savings of $250,000
Six sigma is not a stand alone initiative but a part of a 3 part quality management
Projects on which Six Sigma will be applied are chosen based on three criteria
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Communication Plan
Three staged communication plan was developed
Stage 1: 350 people were trained in groups ofTop management
Officers
Leadership
The three groups were given extensive training on the application and how it can save capital
Stage 2: Identified people within the organization that will serve as the "backbone of the six sigma process
Stage 3: The employees were split into four categories
Project Champion- A member of upper management who supports the project and removes any roadblocks forthe Black Belt
Master Black Belts- Train Black Belts and mentor them in their projects. They also show progress and successesto upper management.
Black Belts- Implement Six Sigma projects and lead individuals on the improvement team in the right direction
Green Belts- Learn some of the tools, help Black Belts with projects and do small projects of their own. GreenBelts with expertise in different areas often participate on the same team.
CEO also communicated the need for Six Sigma frequently
highlighting its importance for Ford
led to better commitment from top management
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Mega Project: Ford Focus body side
moldings were lifting at the edges
Case Application
Define Tape wasnt in contact with car body
Holes were located too high
Pressure being applied to the molding was low
Body wasnt clean, so tape couldnt stick
Measure How flat was the surface
Measure the pressure
Measure size of the holes, pitch of holes
Percentage of area being cleaned
Analyze Analysis with senior personnel and maintenance
Improve Moved the holes down by 2mm
Changed the molds to make the surface more flat to get tape contact
Using DoE, optimum pressure was found out
Cleaning head was replaced to have better cleaning of surface
Control Hole is being continuously monitored
Molding being flat is a QC for the supplier now
QC for the pressure
QC for surface cleanliness
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Some of the major problems identified during Design phase were:
1. The tape on the molding wasn't contacting the car body enough
2. Holes located on the body used to line up the molding were too high and were hitting an indent on the body side
3. It turned out the pressure we were using to apply the molding was too low
4. The body side was not sufficiently clean, so the tape wasn't sticking as well as it could
Once the problems were identified, MAIC was applied !!!
Measure : The team measured where the holes on the body side were located, how flat the part was and how we could fix the
moulding to make it flat, further the pressure being used was also measured
Analyze : Once all the data had been gathered, the team analysed results and found the appropriate solution
Improve:
The solution included moving the holes on the body side down about 2 millimetres On the body-side moulding, moulds were changed to make sure that it was very flat on the back side
Next they figured out optimum application pressure, then they replaced the head on the cleaning fixtures to clean the
body side more effectively
Control: Changing the hole location on the body side was a permanent fix, regular quality checks to make sure moulds were
flat, ensuring that optimum pressure was used to apply moulding
Overcoming scepticism: Another major chief roadblock to implementing 6 was employee scepticism.
Team felt that the only way to overcome this challenge was to demonstrate successes over time. 2 years later, it was found that more and more Ford employees are jumping on the 6 bandwagon as they realize results
experienced by other departments
Success Story: Since the team's improvements have been implemented, the project has yielded $100,000 in waste elimination
savings per year !!!
Challenges faced by Ford
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Identifyingcustomer desires
Developingvalidated transfer
functions(mathematical
models).
Correlating theseobjective
measures tocustomer desires
Effectivelyassessing the
capability to meetthose desires
Applying transferfunction
knowledge tooptimize designs
Satisfy customerdesires and avoid
failure modes.
DFSS at Ford has emerged as a scientific approach to PD that
leverages Six Sigma culture.
The implementation strategyassumed people would buy intoSix Sigma if results were quickly
realized from the companysshort-term DMAIC projects.
There the importance ofdeveloping DFSS for the longterm was also recognized.
The team held benchmarkingdiscussions with DFSS adoptingcompanies and listened to
consultants familiar with thoseefforts.
The team settled on a four-phase process: define,characterize, optimize andverify (DCOV).
The framework aligned withFords existing product
development system & built onthe disciplines of systems,robust & simultaneous
engineering
Introductory training wasavailable through the Fordtechnical education program(FTEP)
Work was divided intosubprojects with a BB assignedto each. Growth in the numberof projects was driven by asenior vice president
DFSS Master Black Belt wasplaced as manager of thedepartment responsible for thecomputer modeling of newengine designs.
This manager teamed up withan engine program manager toact as working level championsfor DFSS
DFSS @ FORD MOTORS
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Senior management made it clear DFSS would not replace, but would augment, the existing PD process in specifically designated areas
PD entails at least three different categories of scope, The rhythm & timing of DFSS projects associated with these efforts vary depending on the
category
In a division whose senior leader
actively drove DFSS from the start,
project numbers grew exponentially
over the first three years of
implementation. In a similar sized
division, in which DFSS deployment
leaders solicited projects from mid-
level management, project numbers
remained in the low teens for the
same time period.
In DMAIC, BBs identifyand reduce the
frequency of defects
generated. In DFSS,teams must not onlyanticipate & preventdefects, they must
anticipate and meetlatent customer needs.
DFSS requires a balanceof analysis and
synthesisthe synthesisof new designs and
design standards from acombination of reasoning
based on experience,observation and theory
Compounding thechallenge of DFSS is the
added uncertainty about
future customer desiresand future sources andlevels of production andusage variability that will
affect productperformance
DFSS teams must alsohave knowledge aboutnon-statistical methodsfor obtaining consumer
insight, cascadingcustomer desires down
to componentspecifications and
verifying designs withsmall sample sizes for
testing etc.
Project Integration Within Existing Processes
PROCESS FLEXIBILITY
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The Ford team initially devoted time to devising a single DFSS flowchart but was abandoned. The team, therefore, decided to produce two
documents:
1. A tool matrix to outline which tools might be applied at each project phase
2. 2. A project checklist to delineate intended outcomes at each phase. It is used with the understanding some items may not apply to a
particular project as determined by the MBB and executive Champion.
Trainingto
supportDFSS
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Objective: Reduce finished vehicle stock levels of export vehicles,
while ensuring on-time shipping of orders
Six Sigma Project
initiated!
Step 1: Identified CTQs
Stocks of export vehicles cannot exceed 2.5 days of production, about 888 vehicles The time between a vehicles production & its shipment cannot exceed 8 days
All shipments must be made as planned
Step 2: Identified Sub-processes that might affect stock levels: Order receiving,
production, supply, scheduling, shipment
Step 3: Data Analysis
Two types of finished-vehicle stocks: before-gate-release stocks & compound
stocks
Found that average daily stock level(1100 vehicles) far exceeds USL of 888
FORD-OTOSANS OPTIMIZATION OF STOCKSAutomotive company Facilities for production, service & spare-parts distribution
Trying to increase production volume (for domestic market & export)due to increased demand and increase variety
Finished vehicle stocks increased, especially for export vehicles
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Step 5: Identified constraints in developing schedules
Market-priority constraints
Shipment constraints
Supplier constraints
Production constraints
Step 6: Integer Programming Model
To generate daily production schedule, taking into account the fixed shipment days and the Operating Plans
(developed using demand, production capacity & constraints) developed by Ford Europe
Identified 2 more constraints:
Part constraintparts with lowest availability in terms of suppliers daily production capacity
Color Constraint to reduce changeover times between colors
Step 7: Daily schedule obtained for one week using Microsoft Excels Solver
Modifying current process to accommodate fixed shipment days was too costly
The new schedule decreased compound stocks considerably, but not before-gate-release stocks
Step 4: Process Improvement
At Ford-Otosan, order-to-delivery times are not determined solely by production lead times
By scheduling shipment of vehicles on only certain days of the week, the firm restricts the
distribution activities
Also, atleast one extra day is needed by staff members to create customs documents & bills
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Step 8: A new Shop Floor Control System
Earlier, in order to fill the line, the team would start production of some other order without considering
shipment days & routes, which led to inefficient use of vehicles
The new system showed the no. of vehicles that would become available by the shipment day so that it could
be matched with the planned shipment amount
In placing extra orders to fill the line, priority was given to orders that would be ready to ship on the nextspecified shipment date
This control was done every day or even twice a day
Step 9: Analysis of Improvements
Levels of export vehicle stocks reduced significantly
Reduction in order-to-delivery times, resulting in increased
customer satisfaction
Improved process mean is almost half of
that of the previous process, variance isalso smaller
Savings of about $1.2 million in 2003 and $2.6
million in 2004!!
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Thank You
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http://voices.yahoo.com/ford-motor-company-six-sigma-initiative-4844798.html?cat=27 http://www.qualitydigest.com/june03/articles/02_article.shtml
http://www.minitab.com/uploadedFiles/Company/News/Case_Studies/Ford-DOE-EN.pdf
http://www.qualitydigest.com/june03/articles/02_article.shtml
Meltem Denizel et al. Ford Otosan optimizes its stock using Six Sigma. Interfaces. March
April 2007. pg 97-107
Design For Six Sigma at Ford Nathan R. Soderborg, Ford Motor Co
References
http://voices.yahoo.com/ford-motor-company-six-sigma-initiative-4844798.html?cat=27http://www.qualitydigest.com/june03/articles/02_article.shtmlhttp://www.minitab.com/uploadedFiles/Company/News/Case_Studies/Ford-DOE-EN.pdfhttp://www.qualitydigest.com/june03/articles/02_article.shtmlhttp://www.qualitydigest.com/june03/articles/02_article.shtmlhttp://www.minitab.com/uploadedFiles/Company/News/Case_Studies/Ford-DOE-EN.pdfhttp://www.minitab.com/uploadedFiles/Company/News/Case_Studies/Ford-DOE-EN.pdfhttp://www.minitab.com/uploadedFiles/Company/News/Case_Studies/Ford-DOE-EN.pdfhttp://www.minitab.com/uploadedFiles/Company/News/Case_Studies/Ford-DOE-EN.pdfhttp://www.minitab.com/uploadedFiles/Company/News/Case_Studies/Ford-DOE-EN.pdfhttp://www.qualitydigest.com/june03/articles/02_article.shtmlhttp://voices.yahoo.com/ford-motor-company-six-sigma-initiative-4844798.html?cat=27http://voices.yahoo.com/ford-motor-company-six-sigma-initiative-4844798.html?cat=27http://voices.yahoo.com/ford-motor-company-six-sigma-initiative-4844798.html?cat=27http://voices.yahoo.com/ford-motor-company-six-sigma-initiative-4844798.html?cat=27http://voices.yahoo.com/ford-motor-company-six-sigma-initiative-4844798.html?cat=27http://voices.yahoo.com/ford-motor-company-six-sigma-initiative-4844798.html?cat=27http://voices.yahoo.com/ford-motor-company-six-sigma-initiative-4844798.html?cat=27http://voices.yahoo.com/ford-motor-company-six-sigma-initiative-4844798.html?cat=27http://voices.yahoo.com/ford-motor-company-six-sigma-initiative-4844798.html?cat=27http://voices.yahoo.com/ford-motor-company-six-sigma-initiative-4844798.html?cat=27http://voices.yahoo.com/ford-motor-company-six-sigma-initiative-4844798.html?cat=27http://voices.yahoo.com/ford-motor-company-six-sigma-initiative-4844798.html?cat=27http://voices.yahoo.com/ford-motor-company-six-sigma-initiative-4844798.html?cat=27