LEAN Six Sigma Final Exam Study

Project Charter

The official record of each project. A "LIVING" document requiring ongoing updating

"REPEATABILITY" and "REPRODUCIBILITY" are

The primary contributors to measurement error.

Changeover time definition:

The time elapsed between when the last good piece of product A comes off and the first good piece of product B starts.

Waste is

"anything other than the minimum amount of equipment, materials, parts, space, and worker's time which are absolutely essential to add value to the product [or service]." Shoichiro Toyoda President, Toyota

4P model of the TPS: Problem Solving

(Continuous Improvement and Learning) The dynamic of the Toyota Way)

4P model of the TPS: Process

(Eliminate Waste) Eliminate waste through flow and standardization

4P model of the TPS: Philosophy

(Long-Term Thinking) Adding value to customers and society

4P model of the TPS: People/Partners

(Respect, Challenge, and Grow Them) The heart and soul of the Toyota way

Benefits of Value Stream Map (VSM)

- To see across the functional boundaries over which a product's value stream flows - To understand the linkage between the information flow and material flow. - It ties together LEAN concepts and techniques, avoiding "cherry picking" and gut feel improvement initiatives. - Improves customer response times and customer satisfaction. - Provides focus and understanding of improvement efforts. - Increases profitability through improved TAKT times and daily throughput rates.

LEAN Principle #2:

Identify value stream and ELIMINATE WASTE

Value Stream Mapping

Is a method of visually mapping ("from door to door") the sequence and movement of materials, production activities, and information

"Takt" time

Is the heart beat of LEAN. Definition: The tool that links production to the customer by matching the pace of production (pacemaker processes) to the pace of actual final sales AKA the rate of customer demand Takt time= Available Time / Customer Demand

What is LEAN?

LEAN is an umbrella program to create value to the customer by eliminating waste.

LEAN Principle #3:

MAKE VALUE FLOW LEAN

What is the KEY to Critical-to-Satisfaction (CTS's) issues?

Make them MEASURABLE!

The creator of the DMAIC process and deployed tactics ("Belts")

Mikel Harry

Six Sigma was created by and when

Motorola in mid 80's

Common or Controlled causes for Variation

Normal "bouncing around" of any process and need to modify process or technology to reduce

External elements:

Operations that can be performed while the machine/process is running

Internal elements:

Operations that must be performed while the machine/process is stopped

Tools of Quality Control

Pareto: To organize and prioritize data from highest to lowest. Proves 20% of problems cause 80% of impact. Cause & Effect Diagram: Inputs can often be sorted into 6 categories (the 6 M's) Method, Mother Nature, Material, Manpower, Machine, and Measurement Also called Fishbone or Ishikawa Diagram.

4P model of the TPS

Philosophy, Process, People/Partners, Problem Solving

The "P" in the Deming P-D-C-A Cycle

Plan: Identify problem develop plan for improvement

Process Behavior can be described by...

Plotting multiple data points for the same variable over time.

Reproducibility (Operator):

The variation in measurements obtained when multiple persons take repeated measurements on the same parts measuring the same characteristic and using the identical instrument.

Repeatability (Gage):

The variation in measurements obtained when same person takes repeated measurements on the same parts measuring the same characteristic and using the identical instrument.

Define Non-Value Added activities

These activities the customer does not want, does not need and is NOT willing to pay. • These are activities that should be eliminated, simplified, reduced or integrated Ex: Order Processing, Storage, Machine Set-Up, Equipment/People Downtime, Transporting, Rework, Inspection/Testing

Define Value Added activities

These are activities that the customer is willing to pay for. Activities that: • change the size, shape, fit , form, or function of material or information • for the 1st time • to meet customer requirements.

The "A" in the Deming P-D-C-A Cycle

Act: Institutionalize improvement, Continue cycle

'Hoshin Planning' is

An Executive-level process for developing and achieving business plans, whereby the plan and its related goals are deployed throughout the organization.

In Eliyahu M. Goldratt's Theory of Constraint concept, a constraint is

Any factor that limits the performance of a system with respect to its goal. Constraints are physical or systemic limits on capacity (such as equipment, people, new product development, "the market")

Projects, Actions and Tasks always come back to this simple process equation:

Y = f (x1, x2, x3, ... xn) which is referred to as the Big Y - Output (Y) equals some function of all the inputs (x's)

Normal Distribution is...

an approximation of how the data might look if an infinite number of data points were collected. Processes can be characterized by their mean and standard deviation

Affinity Diagrams

Essential when facts or thoughts are uncertain and need to be organized, when ideas need to be clarified, and when unity within a team needs to be created

Typical Six Sigma Performance Metrics:

-Defects Per Unit (DPU): The average number of defects observed when sampling a population. -First Time Yield: Total number of units that get through an operation without being reworked or scrapped divided by the total number of units -Parts Per Million (PPM): The Average Defects Per Unit normalized to one million. -Defects Per Million Opportunities (DPMO): Average Defects Per Unit divided by the number of opportunities to make a defect normalized to one million -Rolled Throughput Yield is the product of the First Time Yields of all steps in a process: It is also the probability of zero defects through all steps of a process (example: RTY = 0.9555 X 0.97 X 0.944 = 0.874 or 87.4%)

Six Sigma is:

1. An overall strategy to accelerate improvements in processes, products and services 2. A measurement of how effective strategies are in eliminating defects and variations from processes, products and services to increase yield. 3. Sigma is a statistical unit of measure that reflects process capability. There is a significant reduction in defects when the Sigma number increases. 4. The sigma scale of measure is perfectly correlated to such characteristics as defects-per-unit, parts-per million defective, yield, and the probability of a failure/error.

Ways to identify Critical-To-Satisfaction Issues:

1. Direct contact in small groups 2. Ask the customers (Survey or Face-to-Face) 3. Performance Score Cards 4. KANO Model 5. Listen to the voice of the customer (VOC)

According to The Six Sigma Way, there are two elements that are critical to the closed-loop business (Six Sigma) system.

1. Finding out which X variables have the most influence on the Y variables 2. A company must use the changes in Y variables to regulate the organization and keep it running right.

Six Sigma does what?

1. Generates sustained success 2. Sets a performance goal for everyone (common goal, common language) 3. Enhanced value to customers and stakeholders 4. Accelerated the rate of improvement 5. Executes strategic change 6. Focuses on the external and internal customers 7. Applies to manufacturing and non-manufacturing companies 8. Requires the commitment and support of leadership 9. Engages the many "silos" of the enterprise

The LEAN principles according the James Womack

1. Specify value in the eyes of the customer 2. Identify value stream and eliminate waste 3. Make value flow 4. Allow the customer to pull 5. Continuously improve in pursuit of perfection

Value Stream has three main parts:

1. The flow of MATERIALS, from receipt from suppliers to delivery to customers 2. The TRANSFORMATION of raw materials into finished goods 3. The flow of INFORMATION that supports and directs both the flow of materials and the transformation

The Evolution of LEAN:

1940s: The foundation of LEAN- Training within industry: The origin of Japanese management and Kaizen. 1950-1970: Dr. Edwards Deming, Continuous Flow Manufacturing, World Class Manufacturing 2000: "THE MACHINE THAT CHANGED THE WORLD"

Kanban:

A Japanese word that means "instruction card". It is a Lean "Pull" device that allows an efficient means to transfer parts from one department to another and automatically reorder products using minimum/maximum inventory levels.

True Statements:

A Process is no faster than its smallest bottleneck Effort spent fixing any process other than the constraint will not impact system overall efficiency

Process Mapping [Process Map (P-map) or map]:

A graphical illustration of the steps of the actual transactional or manufacturing process -Used to help us ensure that all factors that can cause variation and defects have been identified -Can be used to develop "As Is / Can Be" maps. -Helps to "Learn" what input variables are really important. -"Tribal Knowledge" represents much of what is "good" and "bad" about a process.

-Cost of Poor Quality (COPQ) is

A major measurement of the hidden factory. Traditional Costs of Poor Quality are 5-10% of cost Hidden Factory losses could contribute to an additional 15-20% of COPQ Ex: Capacity losses due to reworks and scrap, Stockpiling of raw material to accommodate poor yield, Rush deliveries, Audits, Vendor Control, Lost Customer Loyalty

QUALITY FUNCTION DEPLOYMENT (QFD): Also referred to as the "House of Quality" is what?

A process for product planning and development in which the key customer wants and needs are deployed throughout the organization in all stages of the product development.

Measurement Systems Evaluation is

A quantitative assessment of the tools and process used in making data observations (taking actual measurements).

Quick Changeover:

A rapid and efficient way of converting a process from running the current product to running the next product. It reduces the waste of inventory by creating shorter production runs that better align with customer demand

The Impact/Effort Matrix provides

A visually graphic depiction of the trade-offs between the impact that an alternative will probably have toward resolving the problem, and the effort required.

Brainstorming

A way of generating radical ideas. Criticism and judgment cramp creativity

LEAN Principle#4:

ALLOW THE CUSTOMER TO PULL

"Father of Six Sigma"

Bill Smith

The Concepts Within LEAN

CADENCE- The measure or beat of movement FLOW- A smooth uninterrupted movement BALANCE- Arrange so that one set of elements exactly equals another SYNCHRONIZATION - To cause to operate with exact coincidence FLEXIBILITY - Ready capability to adapt to new, different or changing requirements in time and rate

Translating the Customer Needs Requires:

CTS : Critical To SATISFACTION CTQ : Critical To QUALITY CTD : Critical To DELIVERY CTC : Critical To COST

The "C" in the Deming P-D-C-A Cycle

Check/Study: is the plan working?

In Hoshin Planning, "Catchball" means

Communication, socializing ideas. It is a process of aligning hoshins between levels, through the use of factual (root/cause) analysis.

Pull:

Controlling the flow of resources by replacing only what has been consumed

The Single Minute Exchange of Die process focuses on

Converting INTERNAL to EXTERNAL activities and creating more machine run time.

The four classifications of process inputs are:

Critical, Controllable, SOP and Noise

Customers feel what?

Customers feel the VARIATION Not the Mean

Six Sigma the objective of the Define Phase

DEFINE Phase - Objective: To identify the business improvement opportunity, define critical customer requirements, map the high level processes and value stream map and build effective team

The Six Sigma improvement methodology phases

Define, Measure, Analyze, Improve, Control

The "D" in the Deming P-D-C-A Cycle

Do: Implement plan on test basis

Jack Welch's 4E's and 1P

Energy, Energize, Edge, Execute and Passion

Any business system has:

• at least one constraint, otherwise its performance would be infinite • very few constraints, otherwise it would be unstable and cease to exist

Though Map (T-map):

Graphical representation of your thought process and approach to assist you in satisfying your project goals.

The fastest implementation of six sigma yet was by which company?

Honeywell

LEAN Principle #2

Identify Value Streams

Set in order (Seiton - Arrange for ease of use)

What must be kept; make it visible and self-explanatory; there should be a place for everything and everything should be in its place

Push:

Resources are provided to the consumer based on forecasts or schedules Controlling the flow of resources by replacing only what has been consumed

Risk Priority Number (RPN)

Severity Rating X Occurrence Rating X Detection rating

Realistic goals must be SMART

Specific, Measurable, Attainable, Relevant, Timely

Lean Principle #1:

Specify the value in the eyes of the customer

Facts about data

Statistically, we can do many more potentially useful forms of analysis with continuous data versus discrete Statistical or automatic process control, when properly applied, will eliminate most Special Cause variation. This represents "Process Capability".

Failure Modes and Effects Analysis (FMEA) is...

Systematic approach for identifying, analyzing, prioritizing and documenting potential failure modes, their effects on system, product, process performance and the possible causes of failures

Facts about normal distribution:

The areas under sections of the Normal Distribution estimate the probability of a certain event occurring. No Process Can Be Measured to Establish a Baseline or Improvement Impact Until It Has Been Stabilized. Most processes in the world result in a "Normal" Distribution. Roughly 68% of the data are within a distance of one standard deviation on either side of the mean. Roughly 95% of the data are within a distance of two standard deviations on either side of the mean. Roughly 99.7% of the data are within a distance of three standard deviations on either side of the mean

Six Sigma MEASURE Phase - Objective:

To determine what to measure, manage measurement data collection, develop and validate measurement systems and determine the current process and value stream performance

IMPROVE Phase - Objective:

To generate and implement creative solutions that will eliminate the causes of problems, reduce the variation and waste in a process, or prevent a problem from recurring 1. Generate creative solution ideas 2. Select a solution 3. Pilot test 4. Implement full-scale

Physical Flow (Spaghetti) Diagram- Purpose:

To give a quick visual representation for the movement of a part or associate (operator). Usually when a process is charted for the first time, the flow is not optimal and it looks like a plate of spaghetti.

ANALYZE Phase - Objective:

To understand the sources for variation and waste, identify potential root causes, and stratify and analyze the opportunities for improvement.

Special or Assignable Cause

Uncontrolled variation and due to an "assignable" input

Mistake-Proofing (or Poka-Yoke):

Using ingenuity to create devices that allow us to do our job 100% error free 100% of the time.

Improved FMEA:

We can improve the rate of occurrence and our detection ability, but the severity rating can only change if the customers change their expectations/ requirements

Project Boundaries have?

Well Defined BEGIN & END points prevent scope creep

Value Streams:

consists of ALL ACTIONS required to complete a product or service - Activities that clearly add value - Activities that add no value ... but cannot be avoided (Type One Muda) - Activities that add no value ... and can be avoided (Type Two Muda)

Variation

exists everywhere, impacts the customer, and needs to be understood and controlled

Pitch =

how often work is released and monitored = takt time x pitch batch size (the batch size in which work is released to the pacesetter process)

The Six Sigma Improvement Methodology helps us...

identify and reduce/eliminate sources of variation by applying the various tools, narrowing the number of input variables and optimizing the process

Attribute/discrete data is

qualitative, consists of categories and cannot be subdivided (Yes/No, Pass/Fail, number of defects)

Variable/continuous data is

quantitative showing absolute distance between numbers, and can be subdivided. (Time, Length, Width)

Observed Process Variation is made up of

the Actual Process Variation and the Measurement Variation.

Variation (in production and material transfer times) prevents...

the operation of a balanced factory at 100 percent capacity

The concept of pull in Lean production means

to respond to the pull, or demand, of the customer.

Values Stream Map is NOT

• A flowchart • Based on engineering standards or old information • A once a year planning session

Process Capability - The improvement strategy

• CENTERING - Put the process On Target • SPREAD - Reduce the Variation

How do we use Takt Time:

• Cycle Time must always be less than Takt Time • Number of Operators= Total Work Content/ Takt Time Example: Number of Operators = 10/3.9=2.7 ~ 3 operators

Force Field Analysis specifically can

• Determine if a proposed change can get needed support • Identify obstacles to successful solutions • Suggest actions to reduce the strength of the obstacles

Typical LEAN Measurements:

• Lead Time - The amount of time, defined by the supplier, which is required to meet a customer request or demand. The total elapsed time from when a customer places an order to the time the customer receives that order. Typically 95% of Total Lead Time is Non-Value Added!!! • Process Time - Value adding component of lead time • Cycle Time - The total elapsed time to move a unit of work from the beginning to the end of a physical process. • Queue Time - The time the unit seats idle, waiting for processing • Throughput Time - The amount of work done in a given amount of time • Set-Up Time - The time of actually converting the equipment