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# Six Sigma - An Executive Overview (Mercer)

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• Sigma is the universal symbol for population standard deviation. The standard deviation is the positive square root of the variance of the population. Variance and standard deviation will be discussed many times in later modules.
• The goal of the analyze phase is to describe the problem in terms of statistical variables. This will lead to an understandable statistical solution.
• This is an illustration of a three-sigma process. Alternatively, it can be said that this process has a sigma level of 3. In conventional quality lingo, the Cpk of this process is 1.0. (Cpk = Sigma Level/3)
• By the definition of the probability function, we know that the total area under the curve from: Y = - ∞ to Y = + ∞ equals 1. The area under the curve from –1s to +1s is approximately 68% of the total area. For a probability density function this means that 68% of the time, a sample selected from this population will have a value between –1s and +1s.
• Anyone can go through a typical 4 week M-A-I-C Black Belt course. Unfortunately this will not guarantee the success of a Black Belt or their corresponding project. Our Six Sigma players need to understand two fundamental items about deploying this system. 1) There are actually 7 phases, not 4, required to deliver successful projects. And these phases are executed by our Six Sigma roles. 2) The manner and timeliness of the interactions of these player can make or break the success of Six Sigma within your business.
• Although some organizations can be successful in deploying Six Sigma from the grass roots, this is the exception, not the rule. More common we find the successful deployments of Six Sigma occur when the Executive leadership of an organization drive the vision. Pay close attention to the pitfalls mentioned throughout this module.
• The Six Sigma “Core Team”, also occasionally referred to as the “Steering Committee”, is responsible for developing any and all guidelines for the deployment of Six Sigma within a business. The Core Team addresses many facets of organizational infrastructure throughout their workshops. Some examples follow. The Core Team finance workgroup defines the valuation guidelines for Six Sigma projects. The Core Team human resource workgroup defines the job or role descriptions of the Six Sigma players. The Core Team communications workgroup develops the method and mode of communicating Six Sigma to the rest of the organization. Once the Core Team completes their work, the organization has a structure to support Six Sigma moving forward. This structure is called “infrastructure” and is documented in the Six Sigma Handbook.
• Champions are very key players on our squad. Although they are not usually trained in detail on the MAIC methodology, they are expected to recognize, define, and deliver Six Sigma projects. Think about that. New Champions have no real idea about what Six Sigma is, yet we expect them to select and define good projects. This can be an extremely overwhelming task at first. Many organizations struggle with project definition in the early months of a deployment. As Champions learn more about Six Sigma, they become better at selecting and defining projects. As you might imagine, a properly scoped and well defined project is of immeasurable value to the Black Belt, his team, and eventually, the organization’s bottom line. We often find that Champions require “refresher” training to hone in on the important skill set that leads to proper identification and definition of Six Sigma projects.
• Champions are very key players on our squad. Although they are not usually trained in detail on the MAIC methodology, they are expected to recognize, define, and deliver Six Sigma projects. Think about that. New Champions have no real idea about what Six Sigma is, yet we expect them to select and define good projects. This can be an extremely overwhelming task at first. Many organizations struggle with project definition in the early months of a deployment. As Champions learn more about Six Sigma, they become better at selecting and defining projects. As you might imagine, a properly scoped and well defined project is of immeasurable value to the Black Belt, his team, and eventually, the organization’s bottom line. We often find that Champions require “refresher” training to hone in on the important skill set that leads to proper identification and definition of Six Sigma projects.
• Although Champions are responsible for delivering the financial results of Six Sigma projects, Process Owners have equally important role. The term Process Owner is a generic term used to describe the relationship of an individual to a process. In Six Sigma, the primary role of the process owner is the implementation of the solution for a Six Sigma project. Can you imagine the fear a Process Owners may feel implementing recommendations or solutions from a team he may not have supported? Their lives can be made much easier if the organization can have a formal process for closing out projects. Black Belts can be much more successful if they learn to engage the Process Owner early.
• Team members should come from various levels and key roles of a process to be affected during the execution of the project. Process techs, process doers, process owners, process supervisors, process support personnel are all ideal team members. It is also a good idea to get one or two doubters on the team. They can become your strongest advocates as they participate in the learning of the team. It is important to make sure that these individuals do not feel that the Black Belt is coming in to “rock” their world. Their buy-in is critical and their feeling of ownership throughout the project is of tremendous importance. The more Black Belts can make them feel as though the solutions came from them, the more successful our project implementation plans will be.
• Green Belts across Six Sigma companies vary dramatically in role, amount of training, level within the organization, etc. There is no real standard unlike that of a Black Belt. The whole point of deploying Green Belts is to help an organization achieve critical mass for adaptation of Six Sigma thinking. The more individuals positively impacted by Six Sigma will assist in reaching critical mass. Therefore we should work hard at making sure Green Belt training is a positive meaningful experience for each participant. Green Belts have been known to implement small scoped projects from their own area of expertise. Alternatively, it is not uncommon to see one or two Green Belts assigned to support a single Black Belt on a project team. Some organizations elect to assign two Green Belts to one Sis Sigma project. This can work well within a unionized environment where one GB is from the union side of the fence and the other is not. There is no right answer and multiple roles / expectations can exist within a single organization.
• These should be fulltime dedicated resources committed to delivering solutions for your Six Sigma projects. Everything else we do in Six Sigma is done for the purpose of guaranteeing the success of the Black Belts. If you are not a Black Belt, you should constantly ask yourself the following question: “What can I do to ensure the success of these Black Belts?” Potential Black Belt candidates should come from a pool of highly motivated, well-respected, do-ers of your business. Ideally, they have good computer skills and even better communications / teaming skills. They are individuals that know how to “work” the system to get things done. The experience of becoming a Black Belt is the best personal and professional development available today. Their commitment to the position and your commitment to the potential BB should not be overlooked or undervalued.
• Master Black Belts serve an incredibly important role in any Six Sigma deployment. They can fulfill a broad range of organizational deployment needs. Not only can they serve as your internal technical consultants to BBs and GBs (trainers, mentors, experts), but also they should assist Champions and Deployment Leaders with ongoing deployment activities. Large companies typically start out using external MBBs and over time transition to internal (staff) MBBs. Smaller organizations may decide to utilize external MBBs permanently or can find it worth while to have one part-time MBB on staff who serves in other capacities as well. As you keep your eyes open for potential MBB candidates, make sure they are individuals who are politically astute and well respected within your business. Initially, it is less important that they be technical gurus. If your organization is large enough to support multiple MBBs, deploying individuals with complementary skill sets should be considered.
• Don’t forget that the chart here is only a guideline. Each organization will customize the time commitments per phase of each role as Six Sigma matures. On the following pages we will describe what each role does. For now, lets mention a few key points. Notice that the Executives need to stay engaged throughout all the phases. Also notice the strong involvement of the Champion very early on. The role of the Finance Rep is crucial throughout the life of a Six Sigma project.
• “World Hunger” or “Ocean Boiling” projects are usually the result of poor data, or poor communication. Final inspection or test yield projects using pass/fail type count data are especially prone to this problem. Prior to beginning the project, it may be necessary to set up a more detailed data system to count defects instead of defectives (more on this later) and recording the measurements associated with the test, instead of using the shop floor control system that only counts rejects.
• Implementing Six Sigma in an organization can be expensive. It is important that the organization realize the benefits early in the rollout process. Project goals ought to include a 70% reduction in defects with a resulting savings of &gt; \$175k. A project that reduces defects by 95% but only saves \$10k is not a good BB project. However, a project that only reduces defects by 30% but saves \$1M is a great success! Some projects are difficult to quantify initially because the process is complex and the benefits are far downstream. The financial benefits may only be able to be calculated by observing the downstream effect after the changes have been implemented. The financial benefits should still be reported, however. These projects often have a potential value.
• As Champions, you will need the answers to these 12 key aspects of project definition. An deviation from this will put the success of the project in jeopardy.
• The MAIC process begins with a problem to solve, delivered from the Define Phase. It is structured to avoid many of the pitfalls common to “Quality Improvement” projects. Working on something unimportant Looking for a solution in existing data Recommending without follow through Making changes without traceability The MAIC process generally applies tools with which organizations are familiar. It just applies them in a systematic way to act as a filter, starting with all possible solutions and ending up with the very best.
• The Measure Phase of a Six Sigma project is intended to gather baseline information about the process under review. Since the Measure Phase will have the Six Sigma team identify all process steps, inputs, outputs, capabilities, and resources, the project scope is often refined so that the project is manageable.
• This is a simple fishbone diagram based on the macro-process map in the previous module.
• The Analyze Phase of the Six Sigma project evaluates all the data collected from the measurement systems created during the Measure Phase. During the Analyze Phase, graphical and statistical tools are used to determine which inputs truly drive output behavior. In statisticalese, significant correlations are sought.
• After the Analyze Phase, the Six Sigma project team will have a list of input variables proven to influence process output behavior. The relationships will be further evaluated during the Improve Phase. For each variable that is eliminated from further consideration, the reason for it’s elimination can be explained by some analysis. The Champion should make sure that, at each stage of the project, variables are eliminated and kept as a result of some form of analysis.
• Box plots are a classical method of showing the effect of a discrete input on a continuous output. Box plots are based on medians and quartiles, showing in one picture both location and spread. Frequency plots like histograms and box plots organize data that has been collected across a span of time, and lose the time element. It is usually good take a peek at the time element in a time series plot.
• There are two risks in a trial. First, there is the risk of convicting an innocent man. That is the risk of rejecting the null hypothesis when, in fact, it is true. The second risk is the risk of letting a guilty man go free because of insufficient evidence. That is the risk of accepting the null hypothesis when it is, in fact, false. In the courtroom example, the probability of convicting an innocent person, a, is of critical concern. To minimize the risk of convicting the innocent, overwhelming evidence is required to conclude guilt. To put it in hypothesis testing terms, to reject H0 requires a high probability (usually &gt; 95%).
• FMEA : A systematic analysis of a process used to identify potential failures and to prevent their occurrence Potential Failure mode : The manner in which the process could potentially fail to meet the process requirements. Potential Failure Effect : The effects of the failure mode on the customer. Severity : An assessment of the seriousness of a failure mode. Severity applies to the effects only. Cause : How the failure could occur, described in terms of something that can be corrected or controlled. Occurrence : The likelihood that a specific failure mode is projected to occur. Detection : The effectiveness of current process controls to identify the failure mode (or the failure effect) prior to occurring, prior to release to production, or prior to shipment to the customer. RPN -- Risk Priority Number : The product of Severity, Occurrence &amp; Detection
• The Improve Phase investigates the relationships between those input variables surviving the Analyze Phase filter and key process output behavior.
• The Control Phase of a Six Sigma project assures that a common pitfall is avoided. Often, project teams will make recommendations to an organization and then disband, assuming that the Implementation Leader will find a way to implement the solution somehow.
• ### Transcript of "Six Sigma - An Executive Overview (Mercer)"

1. 1. Larry T. Mercer, Ed.D., FACHE Six Sigma Black Belt Virginia HIMMS Oct 4, 2006 Six Sigma An Executive Overview
2. 2. Agenda <ul><li>Background </li></ul><ul><li>Voice of the Customer </li></ul><ul><li>Project Team Roles </li></ul><ul><li>Variation </li></ul><ul><li>Key Concepts </li></ul><ul><li>DMAIC </li></ul><ul><li>Project Definition Phase </li></ul>
3. 3. Why Six Sigma? <ul><li>Study by the Institute of Medicine titled, </li></ul><ul><li>To Err is Human: Building a Safer Health System </li></ul><ul><ul><li>98,0000 people die each year as a result of preventable medical error in hospitals </li></ul></ul><ul><li>The estimated annual cost of preventable inpatient adverse drug events is \$2 billion </li></ul>
4. 4. What Is Six Sigma? <ul><li>Sigma (  ) is: </li></ul><ul><ul><li>The 18th letter of the Greek alphabet </li></ul></ul><ul><ul><li>The symbol for standard deviation </li></ul></ul><ul><ul><li>A measure of variation </li></ul></ul><ul><li>Six Sigma is also a: </li></ul><ul><ul><li>Vision </li></ul></ul><ul><ul><li>Philosophy </li></ul></ul><ul><ul><li>Management System </li></ul></ul><ul><ul><li>Problem Solving Methodology </li></ul></ul>
5. 5. Six Sigma Goals <ul><li>Improve Patient Safety </li></ul><ul><li>Improve Operating Efficiencies </li></ul><ul><li>Improve Patient Care </li></ul><ul><li>Improve Financial Performance </li></ul>
6. 6. Six Sigma – Where Did It Come From? <ul><li>1984: Motorola Engineer Bill Smith originates the concept of six sigma. </li></ul><ul><li>1988: Motorola wins prestigious Malcolm Baldrige National Quality Award. </li></ul><ul><li>1998: American Society for Quality rolls out its six sigma training program. </li></ul>
7. 7. Benefits Realized From Implementing Six Sigma General Electric *Source IBM Average of \$600 M/year since 1995 Diversed Manufacturer \$1.45 Billion since 1998 Financial Services \$2.5 Billion in 1999 Financial Services \$1.5 Billion in 1999 Technology \$85 Million early 2000 Technology \$1.16 Billion in 2000/2001 Technology \$5 Billion by 2000 (Since 1996) Diversified products Benefits Industry Company \$1.5 Billion (EBIT) by 2003 Chemicals £110 Million in 2000 Products \$34 Million in 2000 Mining and Metals \$40 Million in 2001 Products \$3 Billion since 1995 Energy and Utilities \$700 Million Chemicals \$475 Million in 2001 Automotive Benefits Industry Company
8. 8. Imagine If…  You could select one of your biggest problems . . . ?  Assign one of your best people to work on it . . . ?  Provide that person with all the tools, resources, and management support needed to fix it . . . ?  And guarantee them uninterrupted time and focus to work on it . . . ?
9. 9. The Six Sigma DMAIC Process Remember: the goal is the practical solution. Practical Solution Control Statistical Solution Improve Practical Problem Measure Statistical Problem Analyze
10. 10. Why We Do Six Sigma <ul><li>Intangible---Difficult or Impossible to Measure </li></ul><ul><ul><li>Re-inspection </li></ul></ul><ul><ul><li>Lost or missing information </li></ul></ul><ul><ul><li>Lost customer satisfaction </li></ul></ul><ul><ul><li>Re-design of software </li></ul></ul><ul><ul><li>Modifying service processes to correct deficiencies </li></ul></ul><ul><ul><li>Redundant operations </li></ul></ul><ul><li>Tangible---Measurable </li></ul><ul><ul><ul><li>Inspection </li></ul></ul></ul><ul><ul><ul><li>Warranty </li></ul></ul></ul><ul><li>Rework </li></ul><ul><li>Rejects </li></ul><ul><li>Scrap </li></ul>
11. 11. CUSTOMER FOCUS <ul><li>Voice of the Customer </li></ul><ul><li>CT’s (Critical To …) </li></ul><ul><ul><li>CTQ – Critical to Quality - GOOD </li></ul></ul><ul><ul><li>CTD – Critical to Delivery - FAST </li></ul></ul><ul><ul><li>CTP – Critical to Price - CHEAP </li></ul></ul>There are 3 key areas to Customer Focus.
12. 12. Supplier Perspective (Theatre) Management)  Good Popcorn  No Sticky Floors  Clean Restrooms  Short Lines  Good, funny, entertaining movies Customer Perspective (Movie Goers) Critical to Satisfaction Characteristics for Movie Goers  Ticket Sales  Concession Sales  Labor/Work Force Costs  Profit Reports  Other... . . . So why do such differences in perspective exist ?
13. 13. Understanding Variation (Six Sigma) LSL USL Anything outside the specification limits represents quality losses Goalpost Mentality Traditional Philosophy LSL USL Any deviation from the target causes customer losses Variation is Evil! Taguchi Philosophy
14. 14. Variation A standard deviation ( s ) is a measure of the amount of spread or dispersion about the mean (  ). Mean ( m ) Standard Deviation ( s ) Lower Specification Limit (LSL) Upper Specification Limit (USL) Process Target (T) A three-sigma (3 s ) process     USL LSL T
15. 15. Basic Statistics and Normal Distribution Probabilities Areas under the curve are probabilities. 68% 95% 99.7%
16. 16. Six Sigma. . . An Aggressive Goal Sigma is a statistical unit of measure that reflects process capability. The sigma scale of measure is perfectly correlated to such characteristics as defects-per-unit, parts-per million defective, and the probability of a failure/error. <ul><li>- Level </li></ul><ul><li>(short-term) </li></ul>Defects per Million Opp. (long-term)
17. 17. Can You Relate? 99.99966% Good (6 Sigma) 5,000 incorrect surgical operations per week 200,000 wrong drug prescriptions each year 1.7 incorrect surgical operations per week 68 wrong prescriptions per year 99% Good (2.8 Sigma)
18. 18. Common Questions <ul><li>What is so different about Six Sigma from Initiatives of the past? </li></ul><ul><ul><li>It builds an infrastructure with lines of accountability throughout the organization </li></ul></ul><ul><ul><li>It stresses breakthrough improvement </li></ul></ul><ul><ul><li>Emphasis is placed on producing better, faster, and lower cost services than the competition </li></ul></ul><ul><ul><li>Emphasis on measurable results </li></ul></ul>
19. 19. Roles <ul><li>The roles inside a Six Sigma organization: </li></ul><ul><ul><li>Executive </li></ul></ul><ul><ul><li>Financial Representative </li></ul></ul><ul><ul><li>Champions </li></ul></ul><ul><ul><li>Process Owners </li></ul></ul><ul><ul><li>Black Belts </li></ul></ul><ul><ul><li>Green Belts </li></ul></ul><ul><ul><li>Team Members </li></ul></ul>
20. 20. Typical Interaction During Phases Execs/Finance/ Champions/ Process Owners BBs / GBs / Team Members Process Owners / Finance/ Champions Properly managing interaction of these circles can make or break the success of Six Sigma. Analyze Control Measure Improve Recognize Define Realization
21. 21. Executives & Deployment Leaders <ul><ul><li>Role </li></ul></ul><ul><ul><ul><li>Own the vision, direction, and results </li></ul></ul></ul><ul><ul><li>Responsibilities </li></ul></ul><ul><ul><ul><li>Determine the scope of deployment </li></ul></ul></ul><ul><ul><ul><li>Identify financial, project, and training related goals </li></ul></ul></ul><ul><ul><ul><li>Identify strategic priorities to which Champions will align projects </li></ul></ul></ul><ul><ul><ul><li>Drive the use of 6  as standard problem solving methodology </li></ul></ul></ul><ul><ul><li>Training: 1 to 2 days </li></ul></ul><ul><ul><li>Pitfalls: Without visible support, Six Sigma struggles </li></ul></ul>
22. 22. Six Sigma Core Team <ul><li>Who are they? </li></ul><ul><ul><li>Multidisciplinary team of 10 or so leaders from key supporting functions of the organization including: </li></ul></ul><ul><ul><ul><li>Nursing </li></ul></ul></ul><ul><ul><ul><li>Finance </li></ul></ul></ul><ul><ul><ul><li>Human Resources </li></ul></ul></ul><ul><ul><ul><li>Information Technology </li></ul></ul></ul><ul><ul><ul><li>Training </li></ul></ul></ul><ul><li>Responsibilities </li></ul><ul><ul><li>Take the executive vision and make it a reality </li></ul></ul><ul><ul><li>Create supporting infrastructure which enables long term success </li></ul></ul><ul><li>Training </li></ul><ul><ul><li>1-5 day </li></ul></ul>
23. 23. Six Sigma Champions <ul><li>Who are they? </li></ul><ul><ul><li>Typically a Director </li></ul></ul><ul><ul><li>Organizations can identify “hands-on” or “executive” Champions </li></ul></ul><ul><li>Role </li></ul><ul><ul><li>Own the financial results of projects </li></ul></ul><ul><li>Responsibilities </li></ul><ul><ul><li>Defines the projects </li></ul></ul><ul><ul><li>Selects Black Belts </li></ul></ul><ul><ul><li>Removes roadblocks to project success </li></ul></ul><ul><ul><li>Report project activity to executive team </li></ul></ul>
24. 24. Six Sigma Champions - continued <ul><li>Training </li></ul><ul><ul><li>1-3 days focused on high level understanding of Six Sigma, the hows of project recognition and definition </li></ul></ul>
25. 25. Process Owners <ul><li>Role </li></ul><ul><ul><li>Owner of the solution delivered by Six Sigma team </li></ul></ul><ul><ul><li>Could be Director, Manager </li></ul></ul><ul><li>Responsible </li></ul><ul><ul><li>Implementation of the team solution </li></ul></ul><ul><ul><li>Assist with culture change at departmental level </li></ul></ul><ul><ul><li>Assist Champion with potential project identification </li></ul></ul><ul><ul><li>Co-leads realization phase with Finance Rep </li></ul></ul><ul><ul><li>Provides resources to serve as team members on projects </li></ul></ul>
26. 26. Team Members <ul><li>Role </li></ul><ul><ul><li>Extend the reach of Six Sigma into the department </li></ul></ul><ul><li>Responsibilities </li></ul><ul><ul><li>Assist Black Belts with data collection and tool application </li></ul></ul><ul><ul><li>Provide invaluable process expertise to Six Sigma team </li></ul></ul><ul><ul><li>Assist Process Owner with the long-term implementation of solution </li></ul></ul><ul><li>Training: 1-3 days </li></ul>
27. 27. Team Members continued <ul><li>Training </li></ul><ul><ul><li>Trained by Black Belts during team meetings </li></ul></ul><ul><ul><li>4 to 8 days </li></ul></ul><ul><li>Pitfalls </li></ul><ul><ul><li>Teams that are too small or too large may prevent project success </li></ul></ul><ul><ul><li>Recognition of team member contribution is critical throughout the life of the project </li></ul></ul><ul><ul><li>Black belt must seek out and get buy-in from Team Members </li></ul></ul>
28. 28. Green Belts <ul><li>Role </li></ul><ul><ul><li>Carry the language of Six Sigma deeper into the organization </li></ul></ul><ul><ul><li>Accelerate number of employees positively affected by Six Sigma </li></ul></ul><ul><li>Responsibility </li></ul><ul><ul><li>Become departmental advocate </li></ul></ul><ul><ul><li>Part-time implementers of smaller scope projects with direct impact to daily non-Six Sigma duties </li></ul></ul><ul><ul><li>Assist BB with team activities and tool application to project area </li></ul></ul><ul><li>Training: 5 -15 days </li></ul>
29. 29. Black Belts <ul><li>Role </li></ul><ul><ul><li>Practitioner of DMAIC Methodology </li></ul></ul><ul><li>Responsibilities </li></ul><ul><ul><li>Ideally full-time facilitator / leader of Six Sigma project team </li></ul></ul><ul><ul><li>Team should discover and recommend project solution </li></ul></ul><ul><ul><li>Executes 4 to 6 projects / year </li></ul></ul><ul><li>Training </li></ul><ul><ul><li>4 to 5 weeks of DMAIC training </li></ul></ul><ul><ul><li>Personal and professional development for later leadership roles </li></ul></ul>
30. 30. Black Belts continued <ul><li>Pitfalls </li></ul><ul><ul><li>The likely success of Six Sigma projects dramatically decreases without the implementation of full-time Black Belts </li></ul></ul><ul><ul><li>If BBs are not selected from amongst the best within an organization, it sends the wrong message </li></ul></ul>
31. 31. Master Black Belt <ul><li>Role </li></ul><ul><ul><li>Varies from organization to organization </li></ul></ul><ul><ul><li>Should make Champions life easier in mature deployment </li></ul></ul><ul><li>Typical Responsibilities </li></ul><ul><ul><li>Instructor and / or mentor of Black Belts and / or Green Belts </li></ul></ul><ul><ul><li>Training material developer </li></ul></ul><ul><ul><li>Deployment assistant to core team and Champions </li></ul></ul><ul><ul><li>Keeper of project backlog list </li></ul></ul><ul><ul><li>Driver of project closure process </li></ul></ul><ul><ul><li>Leader of larger scoped projects </li></ul></ul><ul><li>Training </li></ul><ul><ul><li>Certified BB + additional course work and requirements </li></ul></ul>
32. 32. Typical Time Commitments During 1 st Project Phases Month 0 Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Now, lets look at the interactions. Green Belt or Black Belt Six Sigma Exec & Leader Recognize Define Measure Analyze Improve Control Realize Lead Review Support Finance Rep Process Owner Champion Champion
33. 33. Project Selection Essentials <ul><li>Executives, Management, and Champions trained in project selection </li></ul><ul><li>Manageable number of projects to be launched </li></ul><ul><li>Projects scoped properly </li></ul><ul><li>Focus on both efficiencies and customer benefit </li></ul>
34. 34. Project Scope -- “Common Mistakes” <ul><li>Most common: Scope too broad: </li></ul><ul><ul><li>“ Solving world hunger.” </li></ul></ul><ul><ul><li>Symptoms: Many outputs, vague goals, poorly defined problem </li></ul></ul><ul><ul><li>Solution: Divide problem into several, measurable projects </li></ul></ul><ul><li>Other mistakes : </li></ul><ul><ul><li>Too easy. Problem is known. Solution: fix it! </li></ul></ul><ul><ul><li>Policy issues do not make good BB projects </li></ul></ul><ul><ul><li>Long term development project -- capital intensive </li></ul></ul><ul><ul><li>Process or product re-design </li></ul></ul>
35. 35. Using S.M.A.R.T. For Project Objectives <ul><li>S pecific </li></ul><ul><li>M easurable </li></ul><ul><li>A ggressive yet Achievable </li></ul><ul><li>R elevant </li></ul><ul><li>T ime-bound </li></ul>
36. 36. Money Matters! <ul><li>Whenever possible, the financial benefits of a Six Sigma project should be calculated and tracked </li></ul><ul><li>The typical financial Six Sigma project goal is > \$175k in hard dollar savings </li></ul>
37. 37. Reviewing Project Definition As project Champions, you need these answers! 12. Strategic Link 11. Financial Impact 10. Entitlement 9. Baseline 8. What is the primary metric? 7. Define the Unit of Measure and the Defect. 6. How do you know this? 5. How Much? 4. When is the problem occurring? 3. Where is the problem taking place? 2. Who is the Customer? 1. What is the Problem?
38. 38. The DMAIC Process Optimize & Refine Solutions Control X’s & Monitor Y’s Close & Hand-Off Project Control Refine the Project Process Maps & Simplification C&E for Variable Reduction Process Capability Measure Failure Modes & Effects Analysis ID Variation: Graphical Analysis Plan for DOE Analyze Design & Exec1ute An Experiment Define Y=f(x) Recommended Changes Improve Measurement Capability ID Variation: Statistical Analysis Data Collection Systems
39. 39. Measure Phase Deliverables <ul><li>Refine the Project </li></ul><ul><ul><li>Confirm project scope and objectives with data & forecast </li></ul></ul><ul><ul><li>Establish the key project metrics and track using Metrics.xls </li></ul></ul><ul><li>Process Maps </li></ul><ul><ul><li>Process flow diagram </li></ul></ul><ul><ul><li>Detail process map (inputs / output detail documented) </li></ul></ul><ul><li>Simplify the Process (lean techniques) </li></ul><ul><li>C&E Analysis for Variable Reduction </li></ul><ul><ul><li>Fishbone </li></ul></ul><ul><ul><li>C&E Matrix </li></ul></ul><ul><li>Measurement and Process Capability </li></ul><ul><ul><li>Measurement Systems Analysis </li></ul></ul><ul><ul><li>Short-term and Long-term Sigma Level </li></ul></ul><ul><li>Develop Data Collection System </li></ul><ul><li>Complete Phase Summary </li></ul><ul><ul><li>Conclusions, Issues, & Next Steps </li></ul></ul>Refine the Project Process Maps & Simplification C&E for Variable Reduction Process Capability Measure Measurement Capability Data Collection Systems
40. 40. Measure Phase Tools <ul><li>Process Mapping </li></ul><ul><ul><li>Macro Map </li></ul></ul><ul><ul><li>Process Flow Diagram </li></ul></ul><ul><ul><li>Detailed Process Map </li></ul></ul><ul><li>Cause and Effect Tools </li></ul><ul><ul><li>Fishbone Diagrams </li></ul></ul><ul><ul><li>C&E Diagrams </li></ul></ul><ul><li>Basic Statistics </li></ul><ul><li>Capability Analysis </li></ul><ul><li>Measurement System Analysis </li></ul>
41. 41. Start With a Process Map <ul><li>Refer to a macro-map from an expense accounting example </li></ul>Account Charge Documentation Sent to Finance Finance Personnel Enter Charge on System Finance Distributes Departmental Expense Reports Departmental Heads Request Change Department Heads Review Report
42. 42. <ul><li>Create a simple fishbone from the Expense macro-process map. </li></ul>
43. 43. Analyze Phase Deliverables <ul><li>Describe Project </li></ul><ul><ul><li>Objective statement </li></ul></ul><ul><ul><li>Metrics.xls charts </li></ul></ul><ul><ul><li>Initial validated forecast </li></ul></ul><ul><li>FMEA </li></ul><ul><li>ID Variation: Graphical Methods </li></ul><ul><li>ID Variation: Statistical Methods </li></ul><ul><ul><li>Correlation & Regression </li></ul></ul><ul><ul><li>Means testing </li></ul></ul><ul><ul><li>Sigma testing </li></ul></ul><ul><ul><li>Proportions testing </li></ul></ul><ul><ul><li>Contingency tables </li></ul></ul><ul><li>Planning for DOE </li></ul><ul><li>Complete Phase Summary </li></ul><ul><ul><li>Conclusions, Issues, & Next Steps </li></ul></ul>Failure Modes & Effects Analysis ID Variation: Graphical Analysis Plan for DOE Analyze ID Variation: Statistical Analysis
44. 44. The Analyze Phase <ul><li>What this phase delivers: </li></ul><ul><ul><li>A list of input factors that significantly affect output performance </li></ul></ul><ul><ul><li>Evidence of the significance through the use of analytical tools on data </li></ul></ul><ul><ul><li>Analyze Phase tools: </li></ul></ul><ul><ul><li>Graphical Analysis </li></ul></ul><ul><ul><ul><li>Histograms, scatterplots, boxplots </li></ul></ul></ul><ul><ul><li>Hypothesis testing </li></ul></ul><ul><ul><ul><li>Tests for location, spread, and shape </li></ul></ul></ul><ul><ul><li>Failure Mode and Effects Analysis </li></ul></ul>
45. 45. Graphical Analysis - Example <ul><li>Productivity seems to be consistent across Pullers </li></ul><ul><ul><li>Puller as a significant factor will not be considered further </li></ul></ul><ul><li>Productivity has changed across the months </li></ul><ul><ul><li>Time-related variables will be investigated </li></ul></ul>
46. 46. Hypothesis Testing – An Overview <ul><li>Two hypotheses are offered: </li></ul><ul><ul><li>Ho: Typically represents the status quo </li></ul></ul><ul><ul><ul><li>Assumed true unless the data </li></ul></ul></ul><ul><ul><ul><li>overwhelmingly shows otherwise </li></ul></ul></ul><ul><ul><li>Ha: Typically represents a change </li></ul></ul><ul><ul><ul><li>Proposes (posits) that an input </li></ul></ul></ul><ul><ul><ul><li>factor impacts an output factor </li></ul></ul></ul><ul><ul><li>Example: </li></ul></ul><ul><ul><li>Ho: Defendant is Innocent </li></ul></ul><ul><ul><li>Ha: Defendant is guilty </li></ul></ul>
47. 47. FMEA – An Example Process Step with potentially critical inputs identified by process mapping and surviving the C&E filter Risk Priority Number Used to rank which process steps are important Severity x Occurrence x Detection = RPN 6 x 7 x 9 = 378
48. 48. Improve Phase Deliverables <ul><li>Describe Project </li></ul><ul><ul><li>Objective statement </li></ul></ul><ul><ul><li>Metrics.xls charts </li></ul></ul><ul><ul><li>Review validated forecast </li></ul></ul><ul><li>Design & Execute an Experiment </li></ul><ul><ul><li>DOE </li></ul></ul><ul><ul><li>Pilot Trials </li></ul></ul><ul><li>Define of Y = f (x) </li></ul><ul><ul><li>Main Effects </li></ul></ul><ul><ul><li>Interactions </li></ul></ul><ul><ul><li>Non-linearity </li></ul></ul><ul><li>Summary of Changes Recommended </li></ul><ul><li>Complete Phase Summary </li></ul><ul><ul><li>Conclusions, Issues, & Next Steps </li></ul></ul><ul><li>Present Next Project Description </li></ul>Design & Exec1ute An Experiment Define Y=f(x) Recommended Changes Improve
49. 49. Control Phase Deliverables <ul><li>Describe Project </li></ul><ul><ul><li>Objective statement </li></ul></ul><ul><ul><li>Metrics.xls charts </li></ul></ul><ul><ul><li>Review validated forecast </li></ul></ul><ul><li>Optimize the Outputs and Refine the Solution </li></ul><ul><ul><li>Implement Recommended Changes </li></ul></ul><ul><li>Control Xs, Monitor Ys </li></ul><ul><ul><li>Initiate Control Plan </li></ul></ul><ul><ul><li>Develop Project Metrics Monitoring </li></ul></ul><ul><li>Close and Hand-off Project </li></ul><ul><ul><li>Execute Transition Plan </li></ul></ul><ul><ul><li>Validate Final Financial Forecast </li></ul></ul><ul><ul><li>Complete Final Report </li></ul></ul>Optimize & Refine Solutions Control X’s & Monitor Y’s Close & Hand-Off Project Control
50. 50. Focus of Six Sigma Problem Solving <ul><li>Y </li></ul><ul><li>Dependent </li></ul><ul><li>Output </li></ul><ul><li>Effect </li></ul><ul><li>Symptom </li></ul><ul><li>Monitor </li></ul><ul><li>X 1 . . . X N </li></ul><ul><li>Independent </li></ul><ul><li>Input-Process </li></ul><ul><li>Cause </li></ul><ul><li>Problem </li></ul><ul><li>Control </li></ul>To get results, should we focus our behavior on the Y or X? f (X) Y=
51. 51. Project Turnover and DMAIC Project Turnover Define Measure Analyze Improve Control Realize Recognize
52. 52. Elements of successful turnover <ul><li>Pre-defined procedure is consistently followed </li></ul><ul><li>Results are thoroughly communicated in impacted area </li></ul><ul><li>Buy in is achieved and skepticism addressed </li></ul><ul><li>The process owner is supported </li></ul><ul><li>Two months or less in Control phase </li></ul><ul><li>Vital inputs, Control Plan and Project Action Plan agreed upon </li></ul><ul><li>Financial results communicated and clearly understood </li></ul>
53. 53. Elements of Successful Turnover (continued) <ul><li>Clear plan and buy in for monitoring results </li></ul><ul><li>Visibility for successful projects are provided quickly </li></ul><ul><li>New project ideas are generated </li></ul><ul><li>Black Belt is free to move on </li></ul>
54. 54. Questions?
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