U.S. ARMY ARMAMENT RESEARCH, DEVELOPMENT AND ENGINEERING CENTER (ARDEC)   LEAN/SIX-SIGMA   20 September 2005 Presented to ...
LEAN/SIX SIGMA BOTTOM LINE UP FRONT <ul><li>The Integration of Lean and Six Sigma  has Provided ARDEC with a Proven Commer...
LEAN/SIX SIGMA BOTTOM LINE UP FRONT (Continued) <ul><li>ARDEC Stood Up a Lean/Six Sigma Competency Office to Assure Consis...
ARDEC L/6    Training & Certification <ul><li>Data from Inception (2000) to Present </li></ul><ul><li>Includes ARDEC, Pro...
ARDEC L/6   ROI <ul><li>$2.66B Savings/Avoidance to Date   </li></ul><ul><li>20:1 VE Validated Returns </li></ul><ul><ul>...
ARDEC L/6   Timeline Six-Sigma Initiated by PM CAS Leadership Transitioned to ARDEC First Certification C erem ony Indust...
Operation Levels ARDEC L/6   Board Executive Champions Black Belts Green Belts Team Members Master Black Belts/L6   Comp...
ARDEC Process/EBB Project Map Enterprise Excellence <ul><li>Business Development </li></ul><ul><li>Configuration Mgmt </li...
Executive BB Projects <ul><li>ARDEC Enterprise Excellence </li></ul><ul><ul><li>Integration of E 2  (QMS, Lean/SS, VOC) wi...
Some L/6   Success Stories <ul><li>M795 155mm Artillery Projectile Quality </li></ul><ul><ul><li>Reduced Critical Defects...
Some L/6   Success Stories  (continued) <ul><li>Tank Training Ammunition Joint Reliability </li></ul><ul><ul><li>Process ...
Some On-Going L/6   Projects <ul><li>Green Small Caliber Ammunition </li></ul><ul><ul><li>Elimination of Lead – Environme...
Some Administrative  L/6   Success Stories  <ul><li>Excalibur/TCM Procurement Acquisition Lead Time </li></ul><ul><ul><li...
PAX-2A Explosive Quality <ul><li>Improve the yield of PAX-2A Manufacture at Lab-Scale by developing an alternate mix proce...
M80/PAX-2A High-Speed Load, Assemble & Pack (LAP) <ul><li>Increase the yield of “LAP-compatible” PAX-2A explosive producti...
Procurement Acquisition Lead Time (PALT) <ul><li>Combined the two existing PALT processes into one streamlined (Alpha) pro...
The E 2  Framework QMS VoC 6  Lean Culture Efficiency Effectiveness Reqm’ts Concepts from paper by VSE Corp.
Why Change to “Lean/Six-Sigma  Way of Doing Business”? <ul><li>ARDEC Reorganization led to Transformation from a Tradition...
ARDEC Lean/Six-Sigma Take-a-Ways <ul><li>Needs to be Driven from Top Management for an Effective Organizational Culture Ch...
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  • The foundation of our L/6  transformation is a trained workforce who can identify the opportunities for improvement and who can use the analytical tools to answer those challenges. Our vision is to not to drive individual projects but, rather, to create a climate where L/6  is a way of life. ARDEC (in partnership with our PEO customers) is undergoing an extensive training initiative, with the ultimate goal being 100% Center awareness and understanding of the tenants of L/6  . To date, the exact training goal (types, percentages, etc.) is still under consideration. However, while the end state is still fluid the journey has begun, with 27.4% of the workforce receiving formal (Green Belt) training and more than 14% of those continuing on to higher-level (Black Belt) training. Furthermore, ARDEC has 6 Master Black Belts who act as subject matter experts and who will help shape the Center’s long-term L/6  strategy.
  • Though still relatively early in our journey (only 25% of the workforce receiving formal training), Picatinny has already reaped significant benefits from L/6  . To date, Picatinny has identified over $2.66B in life cycle savings/avoidance to the Army. But even looking at our success through a skeptical eye, Picatinny still has recognized approx. $67M in Value Engineering returns (scored by our independent Value Engineering Office) from its $3M training investment … a better than 20:1 ROI! And this represents only a small portion of Picatinny’s L/6  projects. The measure of L/6  success is the Q$SR model that mandates positive returns in the areas of Quality (customer satisfaction), Cost, Schedule and/ or Risk. As can be seen by the data provided, Picatinny has done a fine job impacting on all these issues, with many projects satisfying multiple requirements. It is also worth note that while we are an RD&amp;E Center, we have identified savings in all aspects of the acquisition life cycle, including improving internal management and administrative processes.
  • Infrastructure: builds the foundation for success.
  • The next few slides describe several Lean and Six Sigma success stories. It is important to note that this is only a small sampling and, as previously stated, each project has provided tangible quality, cost, schedule and risk benefits to the Army. PAX-2a Production : Upon small scale analysis, it was found that the Picatinny Arsenal Explosive (PAX) –2A type II could not be manufactured in a cost effective manner using the current process. Through Process Mapping, FMEA and Design of Experiments, the process redesign increased yield from 70% for the current process to near 100% for the faster process providing significant cost savings impacting Artillery and Rocket systems. This savings will require a switch in supplier and will be implemented at the next buy.
  • Artillery Ammunition Digital X-ray Equipment : Reduced qualification cycle time for Projectile High Explosive Nondestructive Inspection Equipment X-ray System (PHENIXS). Use of the DMAIC process identified process inefficiencies and risk areas allowing for a 33% reduction in qualification time. M734A1 Mortar Fuze Production : A 5% scrap rate for the fuze’s electronic assembly was resulting in related losses of approx. $50K/month. Using Six Sigma protocols, the failure was determined to be due to cracking capacitors caused by mechanical &amp; thermal stresses in the manufacturing process. Re-orientation of the capacitor solved the problem, without increasing unit cost. 120mm Mortar Fin Malfunction Investigation : A preliminary investigation into short 120mm mortar rounds indicated the cause as fin blade shear. Using Six Sigma protocols, high Ignition Cartridge pressure was identified as the root cause and subsequent redesign resulted in saving a $200M stockpile.
  • Lean/Six Sigma has also been used to improve Administrative processes. IM Waiver Process : The waiver approval process was not standardized, often causing program delays including impacts upon Materiel Release. Through the use of such tools as a Process Map and FMEA (Failure Mode &amp; Effects Analysis) a pamphlet was created to provide a clear, structured, repeatable process.
  • As I conclude my presentation, I would ask that you come away from this brief with some significant points: A New Army Thrust is Requiring Program Managers to take a more aggressive approach to life cycle costs. Given the years of “Bloated Bureaucracy”, there are plenty of opportunities throughout the Army’s materiel acquisition process to improve efficiency and effectiveness. The Army has committed to Lean and Six Sigma and has already shown positive Return-on-Investment. And, Lean and Six Sigma savings serve not only the acquisition community and the field commanders, but help to create a better, faster Army at reasonable cost to the taxpayer. Once again, let me express my thanks to the ASQ and the conference committee for their invitation and I look forward to the question &amp; answer period that follows.
  • U.S. ARMY ARMAMENT RESEARCH, DEVELOPMENT AND ENGINEERING ...

    1. 1. U.S. ARMY ARMAMENT RESEARCH, DEVELOPMENT AND ENGINEERING CENTER (ARDEC) LEAN/SIX-SIGMA 20 September 2005 Presented to 32 nd National Energy & Environmental Conference PAUL E. CHIODO Director, Quality Engineering & System Assurance, RDECOM-ARDEC Chair, AMC Quality Federation Certified Lean/Six Sigma Master Black Belt
    2. 2. LEAN/SIX SIGMA BOTTOM LINE UP FRONT <ul><li>The Integration of Lean and Six Sigma has Provided ARDEC with a Proven Commercial Best Practice for Continuous Improvement </li></ul><ul><li>In Partnership with its Customers, ARDEC has: </li></ul><ul><ul><li>Increased Awareness </li></ul></ul><ul><ul><li>Improved RD&E, Manufacturing and Administrative Processes </li></ul></ul><ul><ul><li>Integrated Lean/Six Sigma into the Business Culture </li></ul></ul>Culture Change is Occurring!
    3. 3. LEAN/SIX SIGMA BOTTOM LINE UP FRONT (Continued) <ul><li>ARDEC Stood Up a Lean/Six Sigma Competency Office to Assure Consistent, Effective and Efficient Deployment, Consulting and Training </li></ul><ul><li>ARDEC is Integrating Lean/Six Sigma with a Quality Management System (QMS) and Voice of the Customer (VoC) Protocols on its Journey to Enterprise Excellence SM </li></ul>Culture Change is Occurring!
    4. 4. ARDEC L/6  Training & Certification <ul><li>Data from Inception (2000) to Present </li></ul><ul><li>Includes ARDEC, Program Executive Offices (PEO), Contractors, and Other Government Activities </li></ul><ul><li>Black-Belts have Green Belt as Prerequisite </li></ul>6 78 133 Black N/A 427 1025 Green Master Cert Train Belt Includes Approx. 3.3% of ARDEC Workforce Includes Approx. 27.4% of ARDEC Workforce Goal: 240 Training Incidents/Yr
    5. 5. ARDEC L/6  ROI <ul><li>$2.66B Savings/Avoidance to Date </li></ul><ul><li>20:1 VE Validated Returns </li></ul><ul><ul><li>Value Engineering Adds Rigor </li></ul></ul><ul><ul><ul><li>Recognized Standard </li></ul></ul></ul><ul><ul><ul><li>Independent Verification </li></ul></ul></ul><ul><ul><ul><li>Hard Numbers Only </li></ul></ul></ul><ul><li>All Aspects of Q$SR </li></ul><ul><ul><li>Q : Quality/Customer Satisfaction (91% of Projects) </li></ul></ul><ul><ul><li>$ : Cost (70% of Projects) </li></ul></ul><ul><ul><li>S : Schedule (67% of Projects) </li></ul></ul><ul><ul><li>R : Risk (84% of Projects) </li></ul></ul><ul><li>Improvement Projects in: </li></ul><ul><ul><li>Engineering (35%) </li></ul></ul><ul><ul><li>Production (32%) </li></ul></ul><ul><ul><li>Business/Admin (23%) </li></ul></ul><ul><ul><li>Management (10%) </li></ul></ul>Figures in $M Training Costs VE Validated Savings Estimated Life-Cycle Avoidance 67.3 3 2,660
    6. 6. ARDEC L/6  Timeline Six-Sigma Initiated by PM CAS Leadership Transitioned to ARDEC First Certification C erem ony Industry Benchmark Studies First Integrated Lean/Six-Sigma Course JUL 2000 APR 2001 JAN 2006+ ARDEC Enterprise Excellence SM Plan Complete AUG 2001 JUN 2002 May 2003 OCT 2002 Phase I – Launch & Management Buy-In JUN 2004 APR 2005 GB Training to In-house L/6  Office Established 3 rd Ceremony, 500 th person trained to date at ARDEC Phase II – Full Scale Deployment Phase III – Self Sustain for Continuous Improvement
    7. 7. Operation Levels ARDEC L/6  Board Executive Champions Black Belts Green Belts Team Members Master Black Belts/L6  Comp Office
    8. 8. ARDEC Process/EBB Project Map Enterprise Excellence <ul><li>Business Development </li></ul><ul><li>Configuration Mgmt </li></ul><ul><li>IPT/PM </li></ul><ul><li>System Engineering </li></ul><ul><li>Rapid Prototyping </li></ul><ul><li>Modeling & Sim </li></ul><ul><li>Process Management </li></ul><ul><li>Budgeting Process </li></ul><ul><li>Funds Flow </li></ul><ul><li>Strategic Management </li></ul><ul><li>Technology Transfer </li></ul><ul><li>Workforce Development </li></ul><ul><li>Procurement </li></ul>L/6s Competency Office Customer ARDEC Mission Aiding Processes ARDEC Mission Critical Processes QMS <ul><li>Training </li></ul><ul><li>Consulting </li></ul><ul><li>Deployment </li></ul>VOC <ul><li>Program </li></ul><ul><li>Management </li></ul><ul><li>Funding </li></ul>Products <ul><li>Innovation & </li></ul><ul><li>Engineering </li></ul><ul><li>Technology </li></ul><ul><li>Transition </li></ul><ul><li>High Quality </li></ul><ul><li>Products & Services </li></ul>Discipline Adaptability Speed Label signifies Executive Black Belt (EBB) Projects that impact ARDEC Processes VOC EE EE EE EE EE EE EE EE EE EE EE EE EE CI CI CI CI CI CI CI DT RB RB RB DT TT TT TT RP RP RP Customer Integration Rapid Battle-types Disruptive Technology Technology Transfer Resource Planning Enterprise Excellence EBB Projects EE CI RB DT TT RP CI CI CI CI CI CI
    9. 9. Executive BB Projects <ul><li>ARDEC Enterprise Excellence </li></ul><ul><ul><li>Integration of E 2 (QMS, Lean/SS, VOC) with ARDEC Strategic Plan and Development of the ARDEC E 2 Deployment Plan </li></ul></ul><ul><li>ARDEC Requirements to Execution Framework & Integrated Prioritization Process </li></ul><ul><ul><li>Process for prioritizing and allocating ARDEC resources consistent with ARDEC strategic plan and customer requirements </li></ul></ul><ul><li>Rapid Battletypes </li></ul><ul><ul><li>Identify opportunities to quickly deploy innovative solutions directly to the soldier </li></ul></ul><ul><li>Enterprise Resource Planning </li></ul><ul><ul><li>Increase customer satisfaction across all users that access financial reporting </li></ul></ul><ul><li>ARDEC Technology Transition </li></ul><ul><ul><li>Increase technology transitions from ARDEC tech base to PEO/PM for fielding </li></ul></ul>
    10. 10. Some L/6  Success Stories <ul><li>M795 155mm Artillery Projectile Quality </li></ul><ul><ul><li>Reduced Critical Defects from 5.0% to 0.5% </li></ul></ul><ul><ul><li>$250K Annual Cost Avoidance </li></ul></ul><ul><ul><li>Safety Risk Reduction </li></ul></ul><ul><li>Smart/Precision Munitions Development </li></ul><ul><ul><li>Increased use of Modeling & Simulation and Lab Testing for Risk Reduction </li></ul></ul><ul><ul><li>$35M Cost Avoidance through Reduced Excalibur Ballistic Testing </li></ul></ul><ul><li>PAX-2A Insensitive Explosive Quality </li></ul><ul><ul><li>Increased Yield from 13% to ~ 100% </li></ul></ul><ul><ul><li>$169M Potential Life Cycle Cost Avoidance </li></ul></ul><ul><li>PAX-2A Explosive Large-Scale Production </li></ul><ul><ul><li>Developed Alternate Large-scale Manufacturing process </li></ul></ul><ul><ul><li>Cost reduced from $65/lb. to $30/lb. (Savings: $349M lifecycle Army-wide) </li></ul></ul><ul><ul><li>Implementation on next contract </li></ul></ul>
    11. 11. Some L/6  Success Stories (continued) <ul><li>Tank Training Ammunition Joint Reliability </li></ul><ul><ul><li>Process Re-design </li></ul></ul><ul><ul><li>$6-14M Annual Cost Avoidance </li></ul></ul><ul><li>Artillery Ammunition Digital X-Ray Equipment </li></ul><ul><ul><li>Integrated Contractor & Government’s Approval Processes </li></ul></ul><ul><ul><li>6 Months Reduced to 4 Months (Savings: $120K) </li></ul></ul><ul><li>M734A1 Mortar Fuze Production Yield </li></ul><ul><ul><li>Analysis identified Design Deficiency </li></ul></ul><ul><ul><li>Re-design Reduced Scrap from 5.0% to 0.1% (Savings: $50K/month) </li></ul></ul><ul><li>120mm Mortar Fin Malfunction Investigation </li></ul><ul><ul><li>Developed Corrective Actions to Release Suspended Mortar Ammunition (Stockpile worth $200M) </li></ul></ul><ul><ul><li>Reduced Risk in Future Procurements </li></ul></ul>
    12. 12. Some On-Going L/6  Projects <ul><li>Green Small Caliber Ammunition </li></ul><ul><ul><li>Elimination of Lead – Environmentally Friendly </li></ul></ul><ul><ul><li>Producibility of Tungsten-Tin </li></ul></ul><ul><li>Missile/Artillery Grenade Fuze Removal </li></ul><ul><ul><li>New Fuze Meets UXO Requirements </li></ul></ul><ul><ul><li>Grenade Recapitalization </li></ul></ul><ul><ul><li>Estimated Savings of $41.5M </li></ul></ul>
    13. 13. Some Administrative L/6  Success Stories <ul><li>Excalibur/TCM Procurement Acquisition Lead Time </li></ul><ul><ul><li>54% Reduction </li></ul></ul><ul><li>Insensitive Munitions Waiver Process </li></ul><ul><ul><li>Streamlined Approval Process </li></ul></ul><ul><ul><li>2+ year cycle Reduced to 7 Months </li></ul></ul><ul><li>ECP Review & Approval </li></ul><ul><ul><li>Cycle Time Compliance Increased from 89 to 100% </li></ul></ul><ul><li>New-hire Integration </li></ul><ul><ul><li>$78K Estimated Yearly Savings </li></ul></ul><ul><li>Printer Cartridge Recycling </li></ul>
    14. 14. PAX-2A Explosive Quality <ul><li>Improve the yield of PAX-2A Manufacture at Lab-Scale by developing an alternate mix process that meets high-speed LAP requirements. </li></ul>Type Management Business Production Engineering X R isk S chedule Production yield potential of 100%, up from the original mix process less than 30%. This paves the way for Large-Scale production of PAX-2A. Benefited from other Q$SR areas Benefited from other Q$SR areas Alternate slurry mix process developed that meets minimum bulk density requirements of 0.85 g/cc Co $ t Q uality or Customer Satisfaction
    15. 15. M80/PAX-2A High-Speed Load, Assemble & Pack (LAP) <ul><li>Increase the yield of “LAP-compatible” PAX-2A explosive production and increase the production rate of Dual-Purpose Improved Conventional Munitions (DPICM) between maintenance cycles. </li></ul>Type Management Business Production X Engineering R isk S chedule <ul><li>Significantly Reduced Program Risk to PM-CAS managed M915 and future DPICM Artillery programs for IM insertion </li></ul><ul><li>Significantly increased potential for mission success </li></ul><ul><li>Increased survivability of engaged troops </li></ul><ul><li>M915 Cartridge MR in 1QFY05 with IM enhancement </li></ul><ul><li>Load & Preserve Grenades in FY02-03 under current FY97/98 LRIP contract </li></ul><ul><li>Conduct Accelerated PQT Effort by 4 Months </li></ul><ul><li>Impact GMLRS/M864 RECAP Projects </li></ul><ul><li>Reduce PAX-2A Unit Cost from $132/lb to $68/lb </li></ul><ul><li>Return on $1.5M Program Capital investment </li></ul><ul><li>$1.2B Future Cost Savings to Potential PAX-2A Customers for Manufacture/LAP </li></ul><ul><li>Assets saved in ASP from enemy fire </li></ul><ul><li>Grenade LAP cost savings of $5.41/unit </li></ul><ul><li>PM-CAS (sponsor) indicated this effort will allow achievement of strategic goals. </li></ul><ul><li>Increase Manufacturing yield from 13% to 50% </li></ul><ul><li>Grenade Penetration increase of 25% </li></ul><ul><li>Reduced Product variation- increased SPC </li></ul><ul><li>Increased required cone push-out force by 200% </li></ul>Co $ t Q uality or Customer Satisfaction
    16. 16. Procurement Acquisition Lead Time (PALT) <ul><li>Combined the two existing PALT processes into one streamlined (Alpha) process for XM982. </li></ul>Type Management Business X Production Engineering R isk S chedule Significant risk reduction in meeting DA directed milestones for the XM982 program. The reduced PALT time eliminates a high risk factor in the program. Combined the quasi-concurrent 24-month Army PALT and the 24-month International PALT processes into a single 11 month Alpha contracting effort. Cost avoidance of $12 M, based on a minimum saved effort of four months. VE Validated Savings: $8.9 M PM-CAS (sponsor) ecstatic in that existing schedules were high risk in meeting DA requirements. Co $ t Q uality or Customer Satisfaction
    17. 17. The E 2 Framework QMS VoC 6  Lean Culture Efficiency Effectiveness Reqm’ts Concepts from paper by VSE Corp.
    18. 18. Why Change to “Lean/Six-Sigma Way of Doing Business”? <ul><li>ARDEC Reorganization led to Transformation from a Traditional Product-Driven Structure to an Integrated ‘Continuous Measurable Improvement’ Process-Driven Way of Doing Business </li></ul><ul><li>Positive Impact Obtaining Faster, More Comprehensive, Fact Based Solutions in support of GWOT, OIF, OEF </li></ul><ul><li>Need to Promote Enterprise Excellence (QMS, L/6  , VOC) </li></ul><ul><ul><li>A disciplined , structured approach for process and product optimization that is focused on the effectiveness' and efficiency bottom line of the organization </li></ul></ul>
    19. 19. ARDEC Lean/Six-Sigma Take-a-Ways <ul><li>Needs to be Driven from Top Management for an Effective Organizational Culture Change </li></ul><ul><ul><li>Assure L/6  Projects are Properly Aligned to Customer Requirements </li></ul></ul><ul><ul><li>Provides resources and commitments </li></ul></ul><ul><li>ARDEC L/6  Competency Office Provides: </li></ul><ul><ul><li>Centralized Management </li></ul></ul><ul><ul><li>Organic GB Consulting & Training Activities </li></ul></ul><ul><ul><ul><li>VSE Partnership Still Essential </li></ul></ul></ul><ul><ul><ul><ul><li>Limited Black Belt Pool (Black Belt Distributed to Organization) </li></ul></ul></ul></ul><ul><li>All Phases of the Acquisition Life Cycle and All Business Processes Offer Opportunities for Improved Effectiveness & Efficiency </li></ul><ul><li>L/6  is a Fundamental Component of ARDEC’s Enterprise Excellence SM </li></ul><ul><ul><li>Structured and Disciplined Approach to Meet Mission Objectives </li></ul></ul><ul><li>Lean/Six Sigma is a Commercial Best Practice that is Providing the Army Meaningful Savings … Every Quality, Reliability and Process Improvement Equates to Real Dollars!! </li></ul>
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