Lean Six Sigma Leadership 062507


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High level overview of Lean Six Sigma Leadershp roles and areas of focus for implementation.

Lean Six Sigma Leadership 062507

  1. 1. Lean-Six Sigma Leadership LARRY E. PENNINGTON, PE, CSSBB
  2. 2. What Is Six Sigma? <ul><li>Six Sigma is a problem solving methodology and collection of tools to analyze and remove sources of process variation </li></ul><ul><ul><li>Define </li></ul></ul><ul><ul><li>Measure </li></ul></ul><ul><ul><li>Analyze </li></ul></ul><ul><ul><li>Improve </li></ul></ul><ul><ul><li>Control </li></ul></ul>6s Measurement / Goal Vision / Philosophy Problem Solving Process
  3. 3. Six Sigma (cont’d) <ul><li>6σ denotes a process that has six standard deviations between the mean and either specification limits. </li></ul><ul><li>6σ denotes a process that has only 3.4 defects per million. </li></ul><ul><li>6σ is a process improvement methodology </li></ul>
  4. 4. What Is Lean? <ul><li>Lean is a collection of tools and methods designed to eliminate waste, reduce delays, improve performance and reduce costs </li></ul><ul><li>Lean focuses on eliminating non-valued add; where traditional cost down focuses on reducing the time in value added steps. </li></ul><ul><li>Lean should achieve sustainable business improvements with emphasis on verifiable financial results. </li></ul>
  5. 5. Eliminating The Seven Wastes Predefined methodology to identify and eliminate waste.
  6. 6. Why Lean Sigma? <ul><li>Provides a consistent, quantitative, problem solving methodology </li></ul><ul><li>Helps Improve financial strength thereby helping the company, the customer, and the employee </li></ul><ul><li>Need to build into our culture </li></ul>
  7. 7. The Focus Of Six Sigma Y = f(X) Focus on X’s (process inputs) to improve the Y (process output) <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 </li></ul><ul><li>Cause </li></ul><ul><li>Problem </li></ul><ul><li>Control </li></ul>f (X) Y=
  8. 8. Why Apply Six Sigma <ul><li>“Best in Class” have demonstrated 6σ </li></ul><ul><li>A 4σ company spends >10% of revenue on internal and external repair </li></ul><ul><li>A 6σ company spends <1% of revenue on internal and external repair </li></ul>
  9. 9. Key to Achieving Six Sigma Quality <ul><li>Focus on the customer & listen to the voice of the customer </li></ul><ul><li>Select process that affect customer satisfaction </li></ul><ul><ul><li>Reduce variability in all processes </li></ul></ul><ul><ul><li>Center all processes on the target </li></ul></ul><ul><ul><li>Gather data to reduce defect levels </li></ul></ul><ul><ul><li>Control the inputs and monitor the outputs </li></ul></ul>
  10. 10. Characteristics of Six Sigma Programs <ul><li>Goal of reducing variation, COPQ, and waste in all processes. </li></ul><ul><li>Includes transactional processes as well as manufacturing processes. </li></ul><ul><li>Uses the best talent in the organization, provide intensive training, deploy them on biggest projects. </li></ul><ul><li>Structured problem solving project approach. </li></ul><ul><li>Emphasis on measurable results that are maintained over time. </li></ul>
  11. 11. Contrast with Other Quality Initiatives <ul><li>Improvement initiatives typically involved only a select few, usually from the Quality Department, only people available vs best people for the project. </li></ul><ul><li>Training - little to none. </li></ul><ul><li>Smaller, less tangible gains not visible at the bottom line. </li></ul><ul><li>Gains often disappeared once formal projects ended. </li></ul><ul><li>“ Feel good” exercise with little to show for efforts. </li></ul>
  12. 12. How Lean Sigma Programs Differ <ul><li>Top management support & participation essential for success. </li></ul><ul><li>Infrastructure includes: Steering Committee, Executive Committee, Finance Dept, Program Office. </li></ul><ul><li>Intensive Training and Coaching </li></ul><ul><li>Measurement and tracking of financial metrics. </li></ul><ul><li>Projects chosen for 3-6 month time frame. </li></ul><ul><li>Control plans done to hold gains. </li></ul>
  13. 13. Executive Leader Roles: <ul><li>High Level Executive committed to Six Sigma Success </li></ul><ul><li>Knowledgeable in Six Sigma Process </li></ul><ul><li>Assign key individuals to the Champion/Sponsor Position. </li></ul>
  14. 14. Champion/Sponsor Roles : <ul><li>High Level Executive </li></ul><ul><li>Oversee the Black Belt positions </li></ul><ul><li>Provide resources to complete the job </li></ul><ul><li>Assist Black Belts to select projects </li></ul><ul><li>Benchmark with other organizations </li></ul>
  15. 15. Major Players and Roles <ul><li>Executive Committee - Executive must announce and support the roll-out of Six Sigma and put resources in place. </li></ul><ul><li>Steering Committee - Operations Managers/VPs and representatives from all functional areas who meet regularly to review progress of projects after selection of projects and people . </li></ul>
  16. 16. Major Players and Roles (cont’d) <ul><li>Process Owners: People (usually managers) responsible for the area where the improvement project is taking place. Set goals and objectives for the project leaders. </li></ul><ul><li>Green Belts: Typically receive at least 1 week of training. They do data collection, simple data analysis under direction of Black Belts. May do projects of limited scope. </li></ul>
  17. 17. Major Players and Roles (cont’d) <ul><li>Black Belts: Project leaders, project team coaches, change agents. Typically receive 4 weeks of training spread over four months. Responsible for the financial outcome of their projects. </li></ul><ul><li>Master Black Belts: Primary trainer and coach of Black Belts and Green Belts. A resource to provide technical guidance in the proper application of the tools during project execution. </li></ul>
  18. 18. Methodology: D-M-A-I-C <ul><li>A 5 step approach </li></ul><ul><li>Customer driven quality focus </li></ul><ul><li>A project-based infrastructure as previously described </li></ul><ul><li>Emphasis on providing extensive training in statistical quality tools </li></ul>
  19. 19. Next Step - Six Sigma for Champions <ul><li>FIVE OBJECTIVES (DMAIC) </li></ul><ul><ul><li>Define - Select the right project & </li></ul></ul><ul><ul><li>state it in objective terms </li></ul></ul><ul><ul><li>Measure - Identify the key characteristics & measure performance of products/process </li></ul></ul><ul><ul><li>Analyze - Identify the key process determinants to root cause </li></ul></ul><ul><ul><li>Improve - Model process, change process & optimize performance/reducing variation </li></ul></ul><ul><ul><li>Control - Hold the gains to insure permanent </li></ul></ul>
  20. 20. Define Phase <ul><li>Defining the Project </li></ul><ul><ul><li>Done by members of Steering Committee </li></ul></ul><ul><ul><li>Goal to have a well defined project assigned to a process improvement team </li></ul></ul><ul><ul><ul><li>Objectives and Boundaries Set </li></ul></ul></ul><ul><ul><ul><li>Business Goals, Customer Needs & End Goal(s) </li></ul></ul></ul><ul><ul><li>Outputs: Project Scope w/Critical Goals </li></ul></ul><ul><ul><ul><li>How to Include Cost of Poor Quality </li></ul></ul></ul><ul><ul><ul><li>Including the Voice of the Customer </li></ul></ul></ul>
  21. 21. Stakeholder Analysis <ul><li>Identification of stakeholders involved </li></ul><ul><li>Identification and removal of resistance by involving stakeholders in change process to provide for: </li></ul><ul><ul><li>Needed buy-in </li></ul></ul><ul><ul><li>Alternate solutions </li></ul></ul><ul><ul><li>Removal of pitfalls </li></ul></ul><ul><li>Stakeholders can be: </li></ul><ul><ul><li>Managers-employees-customers-suppliers-finance </li></ul></ul>
  22. 22. Team <ul><li>Team members identified & specified </li></ul><ul><li>Projects of significant size with extensive data analysis should be led by a trained Black Belt. </li></ul><ul><li>Projects broken down into smaller components or involving process redesign, a Green Belt leader is appropriate. </li></ul>
  23. 23. Expected Benefits <ul><li>Project Charter should include: </li></ul><ul><li>Summary of tangible and intangible benefits of the proposed project. </li></ul><ul><ul><li>Baseline Measure – The ‘As-Is” condition </li></ul></ul><ul><ul><li>Improvement target </li></ul></ul><ul><ul><li>Project savings </li></ul></ul><ul><li>Tangible benefits should be expressed both in terms of the relevant performance indicator and the dollar savings. </li></ul><ul><li>Examples of intangible benefits might be: improved customer satisfaction, improved company morale, etc. </li></ul>
  24. 24. Selecting Projects <ul><li>Projects can be submitted by any management member, and are usually submitted to a Steering Committee. </li></ul><ul><li>The role of the Committee is to review the proposed projects and select those that will be actioned. </li></ul>
  25. 25. Define Phase Deliverables <ul><li>Management </li></ul><ul><ul><li>Projects prioritized with Project Charters </li></ul></ul><ul><ul><li>Personnel assigned to lead and participate </li></ul></ul><ul><ul><li>Finance representation to validate savings </li></ul></ul><ul><li>Project Leader </li></ul><ul><ul><li>Clear project mission and goals accepted </li></ul></ul><ul><ul><li>Cost of Poor Quality study within scope of project boundaries. </li></ul></ul>
  26. 26. Measure Phase <ul><li>Goal: Pinpoint location or source of problem </li></ul><ul><li>Exit with statistical characterization of our output (Y) variables and Key Process Input (X) Variables (KPIVs) </li></ul><ul><ul><li>Understand Existing Conditions and Problems </li></ul></ul><ul><ul><li>Use the tools available to measure the magnitude of our problem & how to use basic quality tools (eg “AS IS” workflow model) </li></ul></ul>
  27. 27. Measuring Project COPQ <ul><li>Identify the activities (wastes) that result from poor quality. Use brainstorming methods with project team. </li></ul><ul><li>Determine the effects of these activities on all departments concerned. </li></ul><ul><li>Collect data and estimate the costs for these activities </li></ul><ul><li>Have the resulting COPQ model validated by accounting or finance representative. </li></ul>
  28. 28. Analyze Phase <ul><li>Begin with theories of process problems derived from measure phase </li></ul><ul><li>Collect data to confirm or reject theory </li></ul><ul><li>Identify vital few root causes (inputs) </li></ul><ul><li>Eliminate the potential inputs (Xs) that do not impact our outputs (Ys) </li></ul><ul><ul><li>Cause and Effect Diagram </li></ul></ul><ul><ul><li>Association Matrix showing impact(s) </li></ul></ul>
  29. 29. Improve Phase <ul><li>Select the optimum solution that was Proposed, Developed, Evaluated, and Implemented </li></ul><ul><li>Review outputs to determine the greatest opportunity for improvement. </li></ul><ul><ul><li>Design of Experiments </li></ul></ul><ul><ul><li>Evolutionary Operation </li></ul></ul><ul><ul><li>“ To Be” workflow with possible solutions </li></ul></ul><ul><ul><li>Simulation Results - solutions & alternatives </li></ul></ul>
  30. 30. Control Phase <ul><li>Implement the Solution(s), selected & validated, with controls in place to maintain gains. </li></ul><ul><li>Refine steps with new standards created </li></ul><ul><li>Document new, improved process </li></ul><ul><li>Turn revised process back to the control of the process owner - FIX PERMANENT!! </li></ul><ul><li>Further improvements over time </li></ul>
  31. 31. Summary: <ul><li>Management philosophy of quality </li></ul><ul><li>Statistical target of six sigma or 3.4 defects in one million opportunities </li></ul><ul><li>Components of Six Sigma are people power and process power </li></ul><ul><ul><li>Executive Leader, Champion, Master Black Belt, Black Belt, and Green Belt </li></ul></ul><ul><ul><li>Define, Measure, Analyze, Improve, Control </li></ul></ul><ul><li>Customer focus </li></ul>