As of September 2012 a spool manufacturer was required to supply 23,300 Spools by Jun 2013 Based on the current run-rate of 197 spools per week the spools manufacturer is forecasted to complete the full order of 23,300 Spools in Apr 2014, an estimated 10 months behind schedule As the spool manufacturer was on the critical path for the LNG construction project, the delayed spools were a critical risk to first-gas target date

1. Priority Spool Throughput Rate
Steve Hoyle / Alan Magner
October 2012 – March 2013
Contact:
alanmagner@variancereduction.com

2. Problem Statement
• As of September 2012 the spool manufacturer was required to supply
23,300 Spools by Jun 2013
• Based on the current run-rate of 197 spools per week the spools
manufacturer is forecasted to complete the full order of 23,300 Spools in
Apr 2014, an estimated 10 months behind schedule
• As the spool manufacturer was on the critical path for the LNG
construction project, the delayed spools were a critical risk to first-gas
target date

3. Lean Six Sigma Methodology
All Lean Six Sigma projects follow the 5-step DMAIC methodology to achieve sustainable improvements, focussing
on simplifying and perfecting to make business processes faster, safer, better quality and lower cost
• Define: can we clearly explain the problem, agree on the scope, and understand the customer needs and the
business needs
• Measure: collecting the data on what is really happening, mapping the process steps to make the current
state visible
• Analyse: Identifying the true causes of waste and variation in the process
• Improve: putting in changes that will remove the causes of waste and variation
• Control: Sustaining the changes & behaviours to make sure the improvements become “business as usual”

4. Baseline and Predicted Spool Count
The S-Curve chart shows the accumulated total spools;
Red Line is the baseline outputs at the start of the Lean Six Sigma Project, forecasted Spool completion of April ’14
Purple Line is the forecasted outputs based on improved Spool output, forecasted Spool completion of Sep ’13
Now able to make the spool
requirements to support
the 120-day look-ahead
schedule

5. Value Stream Map
The VSM is both a tool for communicating the improvements, and also a strategy
document to focus improvement efforts

6. Value Stream Map
• A cross-functional team created a Value Stream map was to identify the high-level
steps of the production process, and where delays were happening
• Of the 4 bottlenecks identified, the Paint Process (Surface Treatment) was the most
significant
Initial Investigation of the Paint Process
• the first-pass yield was 20%, which meant that 80% of the volume going through
the bottleneck process was rework

7. Paint Inspection Process
Observations
• Each spool is inspected twice – 1st: spool manufacturer and 2nd: project
management team
• Data not being collected of paint rework and failures
• Pass/fail quality decisions not made in a consistent way
Area of Focus
• If the Paint Inspection process is deciding that 80% of spools need to be reworked
(touch-up, sanding back, extra paint etc.) how confident are we the process of Paint
Inspection is accurate?
• To gauge the effectiveness of the Paint Inspection process an MSA was conducted

8. Paint Inspection Process
Measurement
• A 2-day Measurement System Analysis (MSA) event was run over 2 paint shops using 6
inspectors and 32 spools. In the MSA 1200 data points were collected and analysed;
• Paint thickness accuracy (using DFT measures)
• Cosmetic paint acceptability (pass/fail measure)
Analysis
• 40% accuracy to the baseline standard - inspection process was unreliable; 60% of
pass/fail decisions were incorrect
• No clear SOP existed for conducting an inspection; there were 5 different SOPs across the 6
inspectors

9. Paint Thickness MSA Results
Paint thickness on spools have an upper & lower limit:
Lower Limit: ensure adequate protection of the spool from the elements and spool integrity
Upper Limit: Spools & paint coatings need to expand & contract due to internal temperatures of contents flowing
through spools – paint too thick can crack & deteriorate with temperature expansion
False Readings of paint thickness can lead to false accept & false reject of spools – customer impact risk &
unnecessary re-work risk

10. Cosmetic Acceptance MSA
• Overall Effectiveness was 75%
• Inspectors ranged from 40% to 100% effectiveness
• Three of six inspectors very close in effectiveness
• Other three inspectors were trained to bring effectiveness range to 80% to 100%

11. Cosmetic Acceptance MSA
Causes of variation found at inspection process

12. Improvement #3 – Truck Touch Up Procedure, at Bottleneck
New cosmetic standards for scratches / paint damage on back of the truck – QAQC team are trained
1. Before improvements there was no
cosmetic standard or consistency of
inspection
2. Before improvements, 20% of spools on
trailers require touch-up, which stops the
trailer from departing; delays all spools
(100% of trailers impacted)
3. After improvements, Touch-up time
reduced from 1-hour per trailer down
to 10 mins. per trailer
4. Reduced delays with dispatching
completed trailers

13. Improvement #5 – Inspection Procedures, at Bottleneck
Inspection standards for scratches / paint damage – 9 areas of difference now standardized
New SOPs for;
1. 2 new calibration SOPs
written; for System 1 & for
System 2
2. New SOP for taking DFTs
on Stainless
Observation Recommendation
Project Management inspectors borrow the Spool
Manufacturer thickness gauge, but don’t always ask if it was
calibrated
SOP: Before inspection, ask if
gauge has been calibrated
2 ways to calibrate; 1. Calibrated with a shim on a zero plate, 2.
calibrated on a spool instead of on shims
SOP: decide on 1 method to
calibrate
Checking thickness rules: some follow "within 25mm" rule -
don't check thickness within 25mm of a weld, some don’t
SOP: decide to follow/not follow
"within 25mm" rule
Different standards to follow - which standard to use - "piping"
or "intricate shapes"?
SOP: decide how to choose when
a spool is "piping" or "intricate
shapes"
Some inspectors use a torch to examine surface, some don’t
SOP: decide if torch is needed,
then standardize
Some inspectors lift spool to examine underneath surface,
some don’t
SOP: decide if lifting spool is
needed, then standardize
Some inspectors decide on each spool, 1-at-a-time, others will
decide on a batch of spools after reviewing batch
SOP: decide on single-spool or
batch method, then standardize
Some inspectors took readings starting at one end of the spool
and working towards the other end, others took readings in
random locations - gave himself more walking than needed
SOP: decide on random or end-to-
end method, then standardize
Some inspectors wanted a second opinion – “discuss with
Project Management to see if they would pass”
SOP: decide on individual decision
or joint-decision method, then
standardize

14. Improvement #8 – System 2 Paint process, at Bottleneck
• System 2 paint system
time decreased from
5 days to 14 hours
using simple SOP

15. Spool Output – Control Chart
Average of 191 spools/week before any improvements to 365 spools/week after most
improvements is a 91% increase

16. Spool Output – Significant Increase
Two samples t-Test
Data source: 'Sheet1'O2:P28.
Hypothesis
tested
SummaryStatistics
Mean
Standard deviation
27
190.852
91.196
10
365.8
122.204
TestResult
p Value
0.0
Based on this sample you can
be greater than 99.99%
confident that the means are
different.
Baseline
After
Improvements
Sample size
Analysis by Quantum XL 2013
www.SigmaZone.com/QuantumXL.htm
H1 (ALT)
'Baseline' Mean not equal to 'After Improvements'
Mean
ACCEPTED
Average of 191 spools/week before any improvements to 365 spools/week after most
improvements is a 91% increase
Increase is statistically
Significant

17. Results
Now able to make the spool
requirements to support
the 120-day look-ahead
schedule
• With a 91% increase in outputs the spool manufacturer is no longer on the critical path for
the LNG construction project and removed from the risk-register
• Hard dollar savings in reduced labour and expediting USD$3,200,000

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