Lean Six Sigma Implementation

3. Combining Lean and Six Sigma• The Lean Six Sigma Approach combines – The DMAIC Methodology (from Six Sigma) – Quality Tools (used in both Six Sigma and TPS) – Lean Tools (from TPS) Copyright © 2005-2008 EMS Consulting Group Inc. All Rights Reserved

4. Lean and Six Sigma ToolsSystem Lean / Toyota Six Sigma Production SystemPhilosophy •Elimination of •Reduction of waste defects/variationImprovement •PDCA •DMAICProcess/CycleTools VSM, 5S, Process Mapping, Standardized Work, SIPOC, Hypothesis Leveling, SMED, Testing, DOE, TPM, One Piece Control Charts, etc. Flow, Kanban, etc. Copyright © 2005-2008 EMS Consulting Group Inc. All Rights Reserved

5. The Laws of Lean Six Sigma Lean Six Sigma, George, 2002• Lean means speed; it applies to all processes.• Slow processes are expensive processes.• The Lean metric is process cycle efficiency (Value-added Time/Total Lead Time)• Batch sizes must be calculated using flow variables• 95% of the lead times in most processes is wait time.• To improve speed, you need to identify and eliminate the biggest time traps using the Laws of Six Sigma Copyright © 2005-2008 EMS Consulting Group Inc. All Rights Reserved

6. The Laws of Lean Six Sigma Lean Six Sigma, George, 2002• Laws of Six Sigma – The Law of the Market: Customer CTQ (critical-to- quality) issues must be addressed first. – The Law of Flexibility: Process Velocity is directly proportional to flexibility. – The Law of Focus: 80% of the delay in any process is caused by 20% of the activities – The Law of Velocity: The average velocity of flow through any process is inversely proportional to both the number of “things” in the process and the average variation in supply and demand. Copyright © 2005-2008 EMS Consulting Group Inc. All Rights Reserved

7. Execution of Lean Six Sigma1. Initiation – Top Management becomes engaged in supporting the initiative.2. Resource and Project Selection • Linked to Customer CTQ • Focus on creating value (high NPV projects)3. Implementation / Sustainability / Evolution Copyright © 2005-2008 EMS Consulting Group Inc. All Rights Reserved

9. Deployment Plan• ProcessOrg Results VSM ProjectsGoals ($) Select Identify QualityProducts / Opportun- DMAIC Productivity Value ities Kaizen InventoryStreams (Projects) Lead-Time Sales Copyright © 2005-2008 EMS Consulting Group Inc. All Rights Reserved

10. Deployment Plan • Organization Executive Leadership Resources Accountability Project Champions Resources Accountability Master Process Black BeltBlack Belt Owners Team Members Copyright © 2005-2008 EMS Consulting Group Inc. All Rights Reserved

12. Deployment Plan• Measures – Leading Indicators • # of champions identified • # of BB/GB identified and trained • Size and value of project queue – Financial Improvements linked to each initiative • Quality • Productivity • Inventory • Lead-Time • Sales Copyright © 2005-2008 EMS Consulting Group Inc. All Rights Reserved

13. Deployment Plan• Rewards – Bonuses tied to project performance (savings generated) for team leaders/participants. – Recognition – visible support from executives Copyright © 2005-2008 EMS Consulting Group Inc. All Rights Reserved