Chapter 9: Process Improvement & Six Sigma

FADE

focus, analyse, develop and execute

Pareto diagram

graphical description of a Pareto distribution.

Creativity

seeing things in new or novel ways

Check Sheets

special types of data collection forms in which the results may be interpreted on the form directly without additional processing

Principles of Six Sigma

1. Think in terms of key business processes and customer requirements with a clear focus on overall strategic objectives. 2. Focus on corporate sponsors responsible for championing projects, support team activities, help to overcome resistance to change, and obtain resources. 3. Emphasize such quantifiable measures as dpmo that can be applied to all parts of an organization: manufacturing, engineering, administrative, software, and so on. 4. Ensure that appropriate metrics are identified early in the process and that they focus on business results, thereby providing incentives and accountability. 5. Provide extensive training followed by project team deployment to improve profitability, reduce non-value-added activities, and achieve cycle time reduction. 6. Create highly qualified process improvement experts ("Green Belts," "Black Belts," and "Master Black Belts") who can apply improvement tools and lead teams. 7. Set stretch objectives for improvement.

Process variation and its effect on process Defects per Million Opportunities (DPMO)

3 sigma process variation = 66,800 Defects per million opportunities 4 sigma process variation = 6200 Defects per million opportunities 5 sigma process variation = 230 Defects per million opportunities 6 sigma process variation = 3.4 Defects per million opportunities

Study

Examine the results of the pilot study or experiment. Determine whether process performance has improved. Identify further experimentation that may be necessary.

3 sigma process variation

66,800 Defects per million opportunities

Why Defects, Errors, or Excessive Variation Occur

A lack of knowledge about how a process works, which is particularly critical if different people perform the process. Such lack of knowledge results in inconsistency and increased variation in outputs. A lack of knowledge about how a process should work, including understanding customer expectations and the goal of the process A lack of control of materials and equipment used in a process Inadvertent errors in performing work Waste and complexity, which manifest themselves in many ways, such as unnecessary steps in a process and excess inventories Hasty design and production of parts and assemblies; poor design specifications; inadequate testing of incoming materials and prototypes •Failure to understand the capability of a process to meet specifications Lack of training Poor instrument calibration and testing Inadequate environmental characteristics such as light, temperature, and noise

Analyse

Analysing a problem starts with a fundamental understanding of the process typically accomplished through detailed process mapping, expanding on the SIPOC diagram that is developed in the Define phase. Value stream map - highlights value-added versus non-value-added activities, and include times that activities take.

Six Sigma Teams

Champions, master black belts, black belts, green belts and team members

Do

Conduct a pilot study or experiment to test the impact of the potential solution(s). Identify measures to understand how any changes or solutions are successful in addressing the perceived problems.

Projects selection

Conformance problems are defined by unsatisfactory performance by a well-specified system. Efficiency problems result from unsatisfactory performance from the standpoint of stakeholders other than customers. Unstructured performance problems result from unsatisfactory performance by a poorly specified system. Product design problems involve designing new products that better satisfy user needs—the expectations of customers that matter most to them. Process design problems involve designing new processes or substantially revising existing processes.

DPMO

Defects per Million Opportunities

DMAIC Methodology

Define Measure Analyze Improve Control

Plan

Define the process: its start, end, and what it does. Describe the process: list the key tasks performed and sequence of steps, people involved, equipment used, environmental conditions, work methods, and materials used. Describe the players: external and internal customers and suppliers, and process operators. Define customer expectations: what the customer wants, when, and where, for both external and internal customers. Determine what historical data are available on process performance, or what data need to be collected to better understand the process. Describe the perceived problems associated with the process; for instance, failure to meet customer expectations, excessive variation, long cycle times, and so on. Identify the primary causes of the problems and their impacts on process performance. Develop potential changes or solutions to the process, and evaluate how these changes or solutions will address the primary causes. Select the most promising solution(s).

Define

Describe the problem in operational terms Drill down to a specific problem statement (project scoping) Apply Pareto analysis-identify the most important issues among many symptoms Identify the process-Use a Supplier-Input-Process-Outputs-Customers (SIPOC) diagram Develop a project charter to include-A simple project definition, the project objective, the project team and sponsor, the customers and CTQs on which the project focuses, existing measures and performance benchmarks, expected benefits and financial justification, a project timeline, and the resources needed.

Custom Improvement Methodologies

FADE DRIVE Deming Cycle

Factors in Six Sigma Project Selection

Fit to strategy and competitive advantage Financial return, as measured by costs associated with quality and process performance, and impacts on revenues and market share (cost and benefit analysis) Impacts on customers and organizational effectiveness Probability of success Impact on employees Visible results

Measure

Focus on understanding process performance and collecting the data necessary for analysis. Key data collection questions What questions are we trying to answer? What type of data will we need to answer the question? Where can we find the data? Who can provide the data? How can we collect the data with minimum effort and with minimum chance of error? Operational definitions - clarify performance measures

Master Black Belts

Full-time Six Sigma experts who are responsible for Six Sigma strategy, training, mentoring, deployment, and results.

Black Belts

Fully-trained Six Sigma experts with extensive technical training who perform much of the technical analysis required in Six Sigma projects, usually on a full-time basis.

Green Belts

Functional employees who are trained in introductory Six Sigma tools and methodology and work on projects on a part-time basis, assisting Black Belts while developing their own knowledge and expertise.

Improve

Generate ideas for removing or resolving the problem and improve the performance measures and CTQs. Brainstorming - a group problem-solving procedure for generating a large number of ideas through combination and enhancement of existing ideas. Nominal Group Technique Evaluation and selection Scoring models to assess possible solutions against important criteria such as cost, time, quality improvement potential, resources required, effects on supervisors and workers, and barriers to implementation such as resistance to change or organizational culture. Mistake Proofing and Poke Yoke for process improvement

Team Members

Individuals from various functional areas who support specific projects.

Control

Maintain the improvements, which includes putting tools in place to ensure that the key variables remain within the maximum acceptable ranges under the modified process. establishing the new standards and procedures, training the workforce, and Checklist, periodic meetings, run chart to monitor the performance of key measures

The Deming Cycle

Plan Do Study Act (PDSA)

Process Improvement Methodologies

Redefining and analyzing the problem: Collect and organize information, analyze the data and underlying assumptions, and reexamine the problem for new perspectives, with the goal of achieving a workable problem definition. Generating ideas: "Brainstorm" to develop potential solutions. Evaluating and selecting ideas: Determine whether the ideas have merit and will achieve the problem solver's goal. Implementing ideas: Sell the solution and gain acceptance by those who must use them.

Act

Select the best change or solution. Develop an implementation plan: what needs to be done, who should be involved, and when the plan should be accomplished. Standardise the solution, for example, by writing new standard operating procedures. Establish a process to monitor and control process performance.

Champions

Senior-level managers who promote and lead the deployment of Six Sigma in a significant area of the business.

More characteristics of Six Sigma

Six Sigma is owned by business leader champions. Six Sigma projects are truly cross-functional. Six Sigma focuses on a more rigorous and advanced set of statistical methods and DMAIC methodology. Six Sigma requires a verifiable return on investment and focus on the bottom line.

Training modules for black belts

Statistic in business (basic and advance level), statistical thinking, performance measurement, statistical process control, team effectiveness, process improvement tools and etc.

Creative Problem Solving process

Understanding the "Mess"- identify symptoms Finding Facts - gather data; operational definitions Identifying Specific Problems - find the root cause Generating Ideas - brainstorming Developing Solutions - evaluate ideas and proposals Implementing Solutions - make the solution work

Six Sigma

a business improvement approach that seeks to find and eliminate causes of defects and errors in manufacturing and service processes by focusing on outputs that are critical to customers and a clear financial return for the organization. The term six sigma is based on a statistical measure that equates to 3.4 or fewer errors or defects per million opportunities (dpmo).

Root Cause Analysis

an approach using statistical, quantitative, or qualitative tools to identify and understand the root cause. Root cause -"that condition (or interrelated set of conditions) having allowed or caused a defect to occur, which once corrected properly, permanently prevents recurrence of the defect in the same, or subsequent, product or service generated by the process." "5 Why" technique - forces one to redefine a problem statement as a chain of causes and effects to identify the source of the symptoms by asking why, ideally five times. Cause-and-effect diagram is a simple graphical method for presenting a chain of causes and effects and for sorting out causes and organizing relationships between variables. Scatter diagram - the graphical component of regression analysis.

SIPOC Diagram

broad overview of the key elements in the process, help explains who is the process owner how inputs are acquired who the process serves and how process adds value

Pareto distribution

characteristics observed are ordered from largest frequency to smallest.

DRIVE

define the problem, recognise the cause, identify the solution, verify the actions and evaluate the results

Pareto Analysis

identify the most important issues among many symptoms; Pareto distribution & Pareto diagram