This document provides an overview of continuous improvement and Lean Six Sigma techniques. It discusses W. Edwards Deming's system of profound knowledge and 14-point methodology, which revolutionized Western management practices. Deming emphasized viewing organizations as systems and focusing on continuous improvement. The document also introduces concepts like kaizen, which means continuous improvement in Japanese, and how it differs from innovation. Kaizen focuses on gradual small improvements to processes, while innovation aims for larger leaps. Real-world examples demonstrate how companies achieved huge savings through implementing continuous improvement.

1.  Practical Guide to Implement ContinuousPractical Guide to Implement Continuous
Improvement andImprovement and
 Lean Six Sigma TechniquesLean Six Sigma Techniques
 Jose Villanueva Alcedo, M.B.A./T.M.Jose Villanueva Alcedo, M.B.A./T.M.
World-Published AuthorWorld-Published Author
CEO, Kaizen.comCEO, Kaizen.com

2.  Practical Guide to Implement ContinuousPractical Guide to Implement Continuous
Improvement andImprovement and
 Lean Six Sigma TechniquesLean Six Sigma Techniques
 Part OnePart One
 Module 1, 2, and 3Module 1, 2, and 3

3. Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
YouKaizen.com
Deming’s Philosophy - Third Wave of theDeming’s Philosophy - Third Wave of the
Industrial RevolutionIndustrial Revolution

4. Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
YouKaizen.com
CONTINUOUS IMPROVEMENTCONTINUOUS IMPROVEMENT
Solid Foundation of
3 Ts
Never-ending improvement

5.  System of Profound KnowledgeSystem of Profound Knowledge
 Deming 14-Point MethodologyDeming 14-Point Methodology
Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
YouKaizen.com
Revolutionized the WesternRevolutionized the Western
Management MethodsManagement Methods
& Practices& Practices

6.  Appreciation for a System
 Theory of Knowledge
 Knowledge of Variation
 Knowledge of Psychology
Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
YouKaizen.com
The success of the whole
organization is dependent on
the leaders’ capability to
orchestrate the delicate
balance of each component
for the optimization of the
entire system

7.  Whole and complex
 Clearly defined and shared goals
 Everyone must share a distinct commitment to aim the common goal
 Team-based environment
 Optimize the whole system
 Win-win result for all, as one team
Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
YouKaizen.com
All parts of the system are related

8.  Being part of the whole
 Large number of participants and interactions
 Collaboration
 Interconnecting components
 Interdependence
 Optimizing the whole, not one part
Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
YouKaizen.com
Interdependent parts

9.  Interdependence of all system components
Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
YouKaizen.com
All system components must operate
interdependently in order to be efficient
in business operation.

10. Jose V. Alcedo,
P.E.,M.B.A./TM
10/02/12
MANUFACTURING PACKAGING DISTRIBUTION
ConsumersConsumers
Consumer
research
Design &
redesign
Suppliers of
Materials
A
B
C
Receipts
& test
of materials
Test of processes,
machines,
methods, costs
Module One
YouKaizen.com
Product
Development
Interdependent
processes
Common GoalCommon Goal

11. Jose V. Alcedo,
P.E.,M.B.A./TM
10/02/12
YouKaizen.com

12.  How we learn things
 Data-based knowledge
 Translate knowledge to action
Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
YouKaizen.com

13. Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
YouKaizen.com
Variety vs.
Variation
Variety is good
Variation is bad

14. Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
YouKaizen.com
•No two things are exactly alike,
•not people
•not processes
•Processes vary because of its variation
•Variation is a natural occurrence
•Variation is inherent in life
The Goal of Continuous Improvement
is to reduce the range of variation.

15.  Signal of process behaviorSignal of process behavior
 Process vary due to its variationProcess vary due to its variation
 Variation is a natural occurrenceVariation is a natural occurrence
 Identify causes of variationIdentify causes of variation
 Reduce the range of variation over timeReduce the range of variation over time
 85% of variation due to chance85% of variation due to chance
 15% of variation due to assignable causes15% of variation due to assignable causes
Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
YouKaizen.com

16.  People’s needsPeople’s needs
 Intrinsic motivationIntrinsic motivation
 Hierarchy of needs (Maslow)Hierarchy of needs (Maslow)
 Physiological, Safety, Love, Esteem, Self-actualizationPhysiological, Safety, Love, Esteem, Self-actualization
 Leader’s guidance to see level of needLeader’s guidance to see level of need
Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
YouKaizen.com

17.  The hierarchy of needsThe hierarchy of needs
Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
Physiological
Safety
LoveLove
Esteem
Self-actualization
YouKaizen.com
Maslow’s Need TheoryMaslow’s Need Theory

18.  1. Create a constancy of purpose toward improvement of
product and service
 2. Adopt a new philosophy
 3. Cease dependence on inspection to achieve quality
 4. End the practice of awarding business on the basis of
price tag. Instead minimize total cost
Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
YouKaizen.com
Strategy of creating an environment of trust
and teamwork within the organization.

19.  5. Improve constantly and forever, every process for
planning, production, and service
 6. Institute training on the job
 7. Adopt and institute leadership
 8. Drive out fears so that everyone may work effectively for
the company
Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
YouKaizen.com
Strategy of constant unending improvement for everyone

20.  9. Break down barriers between departments
 10. Eliminate slogans, exhortations, and targets for the work force
 11. Eliminate work standards (quotas) on the factory floor and numerical
goals for management
Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
YouKaizen.com
Remove the barriers
All in one team, focus on processes,
then improve processes and the results should follow.

21.  12. Remove barriers that rob people of pride of
workmanship
 13. Institute a vigorous program of education and self-
improvement for everyone
 14. Put everybody in the company to work to
accomplish the transformation
Jose V. Alcedo, P.E.,
M.B.A./TM
Module One
YouKaizen.com

22. Jose V. Alcedo, P.E.,
M.B.A./TM
YouKaizen.com

23. Jose V. Alcedo, P.E.,
M.B.A./TM
• Kaizen is a Japanese name
- kai = change, zen = good
• Continuous Improvement Philosophy
Initially taught in U.S.A.
• Deming and Juran -Taught in Japan
after World War II
YouKaizen.com

24. Jose V. Alcedo, P.E.,
M.B.A./TM
• Way of thinking applied in all work
• Focuses on continually improving the
processes and systems first
• Produce products and services
that meet or exceed customer’s
satisfaction
YouKaizen.com

25. Time
Improvement
$
Jose V. Alcedo, P.E.,M.B.A./TM
Ideal Pattern from
Innovation
$
$
Innovation I
Innovation II
Innovation III
(Std)
(Std)
(Std)
YouKaizen.com

26. Time
Improvement
$
Jose V. Alcedo, P.E.,M.B.A./TM
Actual Pattern from
Innovation
$
$
Innovation II
Innovation III
A
B
C
A,B,C =What should be Std
Innovation I
YouKaizen.com
Innovation can declineInnovation can decline
in performancein performance
with timewith time

27. Time
Improvement
$
Jose V. Alcedo, P.E.,M.B.A./TM
Innovation plus Kaizen
Innovation I
Innovation II
Kaizen
$
Kaizen
YouKaizen.com
Fostering Innovation
with
Continuous Improvement

28. Time
Improvement
Jose V. Alcedo, P.E.,M.B.A./TM
Kaizen alone
Kaizen
YouKaizen.com
IMPROVEMENT
Ongoing Improvement

29. Jose V. Alcedo, P.E.,M.B.A./TM
SCIENCE TECHNOLOGY DESIGN PRODUCTION DISTRIBUTION
INNOVATION KAIZEN
YouKaizen.com

30.  Kaizen  Innovation
Jose V. Alcedo, P.E.,M.B.A./TM
Gradualist approach Great-leap approach
Small improvement Innovation
Uses seven tools of
Quality
No tools
Concerned more with
processes
Concerned more with
results
YouKaizen.com

31.  Kaizen  Innovation
Jose V. Alcedo, P.E.,M.B.A./TM
Improvement is slow,
measures process
activities
Measures profit
Close connection
between Development,
Design and Production
No collaboration
among
departments
KAIZEN speaks with Data Speaks with intuition, gut
feel
YouKaizen.com

32.  Kaizen  Innovation
Jose V. Alcedo, P.E.,M.B.A./TM
People - oriented Innovation – technology,
money oriented
Uses structured problem
solving PDCA process
No problem
solving tools
Covers Design, Production
and Distribution
Covers Science, Technology
and Design
YouKaizen.com

33. Jose V. Alcedo,
P.E.,M.B.A./TM
YouKaizen.com
• SWOT Analysis
• Integrate Continuous Improvement into Business Plan
• Have short term and long term goals
• Core competencies
• Identify key processes and resources
• Project management time line
• Focus on improving Input, Process, Output
• Cash Flow projection
• Cost Benefit Analysis
• Strategic Plan for Sustainability
Strategic Advantage
If your business does notIf your business does not
have a Business Plan, it canhave a Business Plan, it can
go somewhere else.go somewhere else.

34. Jose V. Alcedo,
P.E.,M.B.A./TM
YouKaizen.com
Masaahi Imai (1986) in his book, Kaizen, explained:
Key to Japan’s competitive success is Kaizen – Continual Improvement
-gradual, unending improvement broken down into:
• Management-oriented Kaizen
• Group –oriented Kaizen
• Individual-oriented Kaizen

35. Time
Jose V. Alcedo, P.E.,M.B.A./TM
YouKaizen.com
Goal: College &NFL
Football Runningback
Zae ALCEDO #44 - 2nd
Year
High School Scholar at
Campbell Hall, North
Hollywood, Calif.
Fostering his
God-given
Talents with
Continuous
Improvement
Techniques
By Team Effort
with his dad
Milestones

36. YouKaizen.com
TBM Consulting Group Inc. (Quality Progress
-April 1997)
Survey of Kaizen programs based on four continents,
Kuantan, Malaysia, to Sao Paulo, Brazil, to Raunheim,
Germany, to Hot Springs, AR.
Survey respondents that practice lean:
• 64% reported lead times on product production
• 63% were able to hold down or decrease product pricing
• 61% experienced increased market share
• 39% reduced the time required to launch new products
• 24% were able to increase diversity of their product lines

37. YouKaizen.com
Basic Statistics, Mark J. Kiemele, Stephen R. Schmidt, 1993, Air Academy Press
Huge savings:
Ford Motor Co.
• Increased market share and profit
• 65% reduction in customer reported defects
• 35% increase in customer satisfaction
Xerox
• Manufacturing costs down 20% (1982 – 1986)
• Cycle Time reduced by 60%
• Revenue produced per employee up 20%

38. YouKaizen.com
Basic Statistics, Mark J. Kiemele, Stephen R. Schmidt, 1993, Air Academy Press
Huge savings:
Westinghouse Electric Corp/Commercial Nuclear Fuel
Division
• Increased increased manufacturing by over 37%
• Reduced scraps, rework, and manufacturing cycle time
Hewlett Packard (Yokohama)
• Profit up 244% from 1977-1984
• Hardware failure rates down 79%
• Manufacturing costs down 42%
• Productivity up 120%
• Market share up 19%

39. YouKaizen.com
Basic Statistics, Mark J. Kiemele, Stephen R. Schmidt, 1993, Air Academy Press
Huge savings:
Boeing Aerospace Co.
For the Initial Upper Stage Program:
• Billing errors reduced 0%
• Cycle time reduced from 20 days to 3
• Technical order processing streamlined – saving $875 and 3.75 man-hours
per O.T.
• For the AWACS contract, billing delinquencies reduced by 50%
• Overall Savings: $1.5 million per year
Pittron Steel Foundry
• Sales increased by 400%
• Profits up by 30%
• Productivity up 64%

40. YouKaizen.com
Basic Statistics, Mark J. Kiemele, Stephen R. Schmidt, 1993, Air Academy Press
Huge savings:
U.S. Navy
F-14 Overhaul Program:
• Cut average cost from$1.6 million per aircraft in 1986 to $1.2 million in 1989
Cherry Point:
• Aircraft failure rates reduced by 90% (1987-1988)
Overhaul of USS Saratoga:
• Expected to save $10 million and 22,000 man-days
Norfolk Naval Shipyard:
• Reduced rejection rate in electronic connectors from 55% to 6%
Internal Revenue Service
• Processing errors reduced from 30,000 (1986) to 3,000 (1987)

41. YouKaizen.com
Basic Statistics, Mark J. Kiemele, Stephen R. Schmidt, 1993, Air Academy Press
Huge savings:
U.S. Navy
F-14 Overhaul Program:
• Cut average cost from$1.6 million per aircraft in 1986 to $1.2 million in 1989
Cherry Point:
• Aircraft failure rates reduced by 90% (1987-1988)
Overhaul of USS Saratoga:
• Expected to save $10 million and 22,000 man-days
Norfolk Naval Shipyard:
• Reduced rejection rate in electronic connectors from 55% to 6%
Internal Revenue Service
• Processing errors reduced from 30,000 (1986) to 3,000 (1987)

42. YouKaizen.com
Basic Statistics, Mark J. Kiemele, Stephen R. Schmidt, 1993, Air Academy Press
Huge savings:
Social Security Administration
• Claim processing reduced to 73.9 days in 1987 from 81 days in 1986
Department of Housing and Urban Development
• Average time to process a loan for property improvement and purchase
of manufactured housing was 85 days (1985), 29 days (1986), and 22 days
(1987)
Massachusetts General Hospital
• Improved the billing process by reducing monthly defects by 52%, resulting
in projected $189,000 savings per year

43. YouKaizen.com
Huge savings:
9/11/12: “ I was fortunate enough to work with Joe for twenty years. He has
Excellent work ethics and a great set of values. Joe introduced and trained
Pharmavite and me on Statistical Process Control, Continuous Improvement,
Lean Best Practices and led the charge throughout the company.
As an example, on one project, we reduced our lead time by 83%.”
William D. Cottrell, CEO/Principal, Cottrell Consulting
Supply Chain and APICS Professional
__________________________________________________________________
Pharmavite, LLC, California:
•Continuous Flow Process reduced manufacturing cycle time by 50%
•Reduced inventory count from 7 to 2 days
•Statistical Process Control, contract manufacturing from P&G
Jose V. Alcedo,
P.E.,M.B.A./TM

44. YouKaizen.com
Huge savings:
Pharmavite, LLC:
• Soft Gelatin Polishing Cycle Time reduction by 60%
• Six Sigma tablet weight vitamin savings and excellent product quality
• Reduced errors in Batch Reports – resulting to reducing product release
time by 40%.
• Company-wide Team-based organizational transformation – strategic
advantage through High Performance Teams throughout the enterprise,
leveraged global market share
Jose V. Alcedo,
P.E.,M.B.A./TM

45. Jose V. Alcedo, P.E.,
M.B.A./TM
YouKaizen.com

46. Jose V. Alcedo, P.E.,
M.B.A./TM
YouKaizen.com
 The key strategyThe key strategy
 Systems approach to changeSystems approach to change
 Process thinkingProcess thinking
 Success factorsSuccess factors
 Focus on the ProcessFocus on the Process
 Process modelProcess model
 SIPOC, COPISSIPOC, COPIS
 Variation in a ProcessVariation in a Process
 Group paper, oral presentationGroup paper, oral presentation

47.  Deming - based philosophy for maintaining the
competitive advantage
Jose V. Alcedo, P.E.,M.B.A./TM
Processes
Systems
People
Strategy which focuses on continuous
improvement of all
YouKaizen.com

48. Jose V. Alcedo, P.E.,M.B.A./TM
YouKaizen.com
Present
state
The Change Process
Transition
state
Future
state
Allies
Allies
Allies
Allies Allies
Allies
Allies
Why change ?
Sustainability
Considerations:
•Visions, Missions, End state
•Organizational behavior
•Human factors
•External influence

49. Jose V. Alcedo, P.E.,M.B.A./TM
YouKaizen.com
Goal:
A. Integrate Continuous Improvement
Technology Course into CPU
Packaging Engineering and Business
Administration Curriculum
B. Implement Continuous
Improvement in CPU Business
Processes

50. Jose V. Alcedo, P.E.,M.B.A./TM
YouKaizen.com
Align with goals and reason
for being:
Where are we going
What work should we do
How do we get there
Always keep our mission in
mind

51. Jose V. Alcedo, P.E.,M.B.A./TM
YouKaizen.com
Continuous Improvement (CI)
focuses on improving
processes involving 4Ms:
•Men (People)
•Machines
•Materials
•Methods

52. Jose V. Alcedo, P.E.,M.B.A./TM
YouKaizen.com
Have a strategy:
•Manage the direction: Focus on consistent direction.
•Obtain the buy-in of the process managers and
collaborate with them and the people in the whole
system with a holistic vision to improve the
Process.

53. Jose V. Alcedo, P.E.,
M.B.A./TM
YouKaizen.com
Managing The Change
Like steering a
sailboat in
turbulent water
and stormy winds.
If the wind is
blowing at gale
force dead
broadside, you
have to make a
number of critical
choices.
The true sailor,
knowing these
choices works
with the wind.

54. Jose V. Alcedo, P.E.,M.B.A./TM
YouKaizen.com
Leadership
•Committed to satisfying customers
•Increase ability to respond to change
•Develop strategy
•Define roles
•Define goals
•Provide resources
•Lead by example
•Provide training

55. Jose V. Alcedo, P.E.,M.B.A./TM
YouKaizen.com
Corporate culture:
•Be obsessed with adding value for
the customer
•Support incremental improvement
(individual own work, groups, teams)
•Team-based culture transition

56. Jose V. Alcedo, P.E.,M.B.A./TM
YouKaizen.com
Attitudes:
•Fully accept and internalize the need
for CI
•Involvement and pride in CI activities

57. Jose V. Alcedo, P.E.,M.B.A./TM
YouKaizen.com
Training:
•Establish a training program
•Awareness of employees’ role in CI
•Raise capabilities and empowerment
•Seven basic tools (Flowcharts, Pareto
Diagrams, Cause & Effect Diagram, etc.)
•Maximize effectiveness
•Begin at the top and cascade down

58. Jose V. Alcedo, P.E.,M.B.A./TM
YouKaizen.com
Planning and Execution:
•Select significant improvement
opportunities
•Phased step-by-step approach
•Evaluate fine tuning vs. fundamental
redesign
•All in one team involvement
•Cross functional
•Multilevel
•Involve the entire system (suppliers and
customers)

59. Jose V. Alcedo, P.E.,M.B.A./TM
YouKaizen.com
Planning and Execution:
•Coordinate activities
•Project timeline
•Ensure stable processes after each
planned change
•Evaluate change benefits
•Make the change permanent

60. Jose V. Alcedo, P.E.,M.B.A./TM
YouKaizen.com
Continuous Improvement is to take a hard look at
processes and reduce the variation in key business
performance, first, before achieving the bottom-line.

61. Jose V. Alcedo, P.E.,M.B.A./TM
YouKaizen.com
Improve your process
first, by reducing variation,
then the results will follow.
Competitive Edge –Practical
Guide to Implement
Continuous Improvement
www.YouKaizen.com

62. - A blending of inputs to achieve the
desired outputs
Jose V. Alcedo,
P.E.,M.B.A./TM
PROCESS
INPUTS OUTPUTS
People
Material
Equipment
Procedures
Service
Product
Task
YouKaizen.com

63. Jose V. Alcedo,
P.E.,M.B.A./TM
YouKaizen.com
• SIPOC • COPIS
SSupplier
IInput
PProcess
OOutput
CCustomer
CCustomer
OOutput
PProcess
IInput
SSupplier

64. - Deming: 94% of the variation is due to chance causes/process
which management has control, 6% is due to special causes.
Jose V. Alcedo,
P.E.,M.B.A./TM
YouKaizen.com
Module 3