Six Sigma Presentation


Published on

A research project on Future of Six Sigma and how it aligns with the innovative strategies at a company

Published in: Business, Technology
  • Be the first to comment

  • Be the first to like this

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide
  • Talk about the two questions put forth to us here.
  • List the recommendation briefly.
  • Talk about the one recommendation again. Refresh their memory.
  • Talk about the one recommendation again. Refresh their memory.
  • Now that we have seen few methodologies to promote innovation in the organization, let us now take a look at variation or a new form of SIX SIGMA can help us achieve it.
  • Lean-waste reduction and Six Sigma-quality improvement methodologyWhen Lean meets Six Sigma, all projects begin with a problem statement, so the Lean Six Sigma frameworkis, de facto, a problem-solving system. Adding Lean expands traditional Six Sigma defect-reduction problem statements to include thereduction of waste in both time and resources.Yet the aim of typical Lean Six Sigma deployments is modest.A steering committee or some level of management selects projects with two objectives: to improve a process and/or to provide certification for an employee.When certification is the overriding goal, the company usually selects low-hanging fruit for the initial project, and that first project is often the last project the person completes. Either way, this system is a “push” approach to project creation; people hunt for projects because they need to get certified or because members of the Lean Six Sigma steering committee want to brag about how much money they saved the company. Such a system of project selection can produce initial successes, since the projects with the mostpotential benefit to the organization are obvious to everybody without enterprise analysis.
  • In the IEE framework, in contrast, the organizational value chain is examined for improvementopportunities during the E-DMAIC analyze phase. It consolidates the Lean approach to waste reduction with the Six Sigma quality improvement methodology — and incorporates a pragmatic, no-gaming scorecard, to build targeted strategies for improving the business as a whole.These strategies then lead to the identification of improvement needs in value-chain performance metrics,so project creation is driven by a pull — rather than push — approach.The result can be either process improvement or R&D design projects that focus on developing innovative new solutions. Emphasis is given to creating financial benefits that will be felt by the entire company, not just at the individual sub-process level. Thus Integrated Enterprise Excellence (IEE), an enterprise system that provides structure for integrating innovation with analytics.
  • In IEE strategy is not a 5 step DMAIC process but a nice step process as we see in the figure
  • 1. Define: Describe a vision and a mission. The organization builds a vision and mission that willremain consistent over time, as leaders and strategies come and go. The company’s full management teammust sign on, and employees must also be on board.2. Define-Measure: Describe the value chain, including satellite-level and 30,000-foot-levelmetrics. The IEE approach tracks two types of high-level metrics as part of the company’s value chain: 30,000-foot-level (operational) metrics and satellite-level (financial) metrics. An IEE company uses satellite-level metrics to track performance in areas such as financial revenue growth and profit margins. Once it has set performance targets for its satellite-level metrics, it builds strategies for achieving those goals. Then, from those strategies, it determines goals for its 30,000-foot-level metrics in an analytic/innovation assessment of the enterprise as a whole. The 30,000-foot-level metrics can include defective rates, on-time delivery, inventory, safety, product development time, and production lead time.3. Analyze: Analyze the enterprise. Using the metrics it has selected, the company needs to identifyaction opportunities, considering both problems and improvement possibilities.The four “analyze” phases are critically important to the E-DMAIC process. These steps can lead toan innovative solution.4. Analyze: Establish goals for satellite-level metrics. Next, the company needs to set specific,measurable, actionable, relevant, and time-based (i.e., “SMART”) goals at the satellite level. The highestlevelgoals need to be realistic and consistent with the improvement opportunities identified in the thirdE-DMAIC step.
  • 5. Analyze: Create strategies. Every organization requires a certain level of innovation. Some needmuch; others need little. It’s essential to find the optimum level, and E-DMAIC provides a structuredmethod for doing so.5. Analyze: Identify high-potential improvement areas, and establish related SMART 30,000-foot-level metric goals. Goals set for the 30,000-foot-level metrics are the ultimate determinants of whatchanges in an organization.6. Improve: Identify and execute projects. Once improvement goals are set, the company shouldselect and assign well-scoped projects that are neither too large nor too small. All projects must reflect theintegration of analytics and innovation. This isn’t difficult once a company has established IEE, becausethe system’s no-nonsense approach to metric tracking and identification of improvement opportunitiesestablishes a culture focused on better use of analytics.7. Improve: Assess the project’s final impact on enterprise goals. Assess how well objectiveswere met relative to the achievement of enterprise goals. Establish a system for collecting and analyzinglessons learned.8. Control: Maintain the gain. IEE businesses track high-level value-chain metrics, then reviewthose results as part of management meetings to ensure that the performance of a particular metric thatimproved as a result of a given project does not subsequently degrade to its previous level.
  • The analyze phase of the enterprise-level DMAIC road map blends analytics with innovationas part of the corporate strategy-building process.
  • Talk about the one recommendation again. Refresh their memory.
  • Six Sigma Presentation

    1. 1. Contemporary Organizations and the Future Six Sigma / Innovation Facet<br />SalilDeshmukh<br />John Gastreich<br />Justin Frey<br />Prem Anand Mathiyalagan<br />
    2. 2. 2<br />Agenda<br />Problem statement<br />Recommendations<br />Innovative companies<br />Links between Six Sigma and innovation<br />Integrated Enterprise Excellence<br />Weighted criteria matrix <br />
    3. 3. Problem Statement<br />Future<br />of<br />Six Sigma<br />Growth<br />versus<br />Performance<br />3<br />How to find a balance between efforts to grow the business and the diligence needed to maintain high performance operations?<br />Which Six Sigma approach or evolution is most appropriate for meeting future business challenges over the next decade?<br />
    4. 4. Scope<br />Within Scope<br />Out of Scope<br />Research next-generation Six Sigma and continuous improvement practices. <br />Compare and contrast how industry front-runners apply six sigma in terms of innovation and growth.<br />Identify qualitative metrics for performance assessment and for rewarding/incentivizing.<br />Perform analysis of as-is RMS Six Sigma methodologies.<br />Perform primary research of direct competitors to RMS.<br />Provide recommendations for a roadmap to move from as-is RMS methodologies to to-be RMS methodologies.<br />4<br />
    5. 5. Research Methodology<br />Primary research: interviews with SMEs<br /><ul><li>Dr. Pamela Slaten– Operations
    6. 6. Dr. Kenneth Smith – Innovation
    7. 7. Dr. Sudha Ram – Business Intelligence
    8. 8. Larry Dyer – Six Sigma
    9. 9. Thomas Pyzdek – Six Sigma</li></ul>Secondary research<br /><ul><li>Trade magazines
    10. 10. Scholarly articles
    11. 11. Books
    12. 12. Others (company websites, industry data)</li></ul>5<br />
    13. 13. Recommendations<br />Do NOT use Six Sigma for innovation activities directly<br />Identify processes/methodologies used to support innovation and other activities; use Six Sigma to improve such processes<br />Innovation Maturity Model<br />Next generation organizational behaviors<br />Instead of applying Six Sigma in silos, use it for the processes of the entire organization <br />6<br />
    14. 14. Innovative companies<br />Justin<br />7<br />
    15. 15. Innovative Company Rankings<br />8<br />
    16. 16. Most Innovative Companies<br />9<br />
    17. 17. Six Sigma in Innovation<br />Of the most innovative companies, only GE couples Six Sigma with Innovation<br />Reasons<br />Stifles creativity<br />Lowers employee morale<br />Only used for process improvement<br />10<br />
    18. 18. Qualities of Innovative Companies<br />Attitudes<br />Willingness to cannibalize assets <br />Future focus <br />Tolerance for risk<br />Practices<br />Empowerment of product champions<br />Incentives for enterprise<br />Internal markets <br />11<br />
    19. 19. Recommendations<br /><ul><li>Do not use Six Sigma for Innovation Activities directly</li></ul>Identify processes/methodologies used to support innovation and other activities; use Six Sigma to improve such processes.<br />Innovation Maturity Model<br />Next generation organizational behaviors<br />Instead of applying Six Sigma in silos, use it for the processes of the entire organization <br />12<br />
    20. 20. Methodologies and tools<br />Prem Anand<br />13<br />
    21. 21. Is there an indirect connection between Six Sigma & Innovation?<br />14<br />
    22. 22. Yes<br />15<br />
    23. 23. Indirect Benefits<br />Organization are undergoing significant changes<br />Emphasis on innovation<br />Proposed methodology<br />Use standard framework to manage innovation<br />Identify processes<br />Use Six Sigma to improve processes<br />Hence Six Sigma can be used indirectly<br />16<br />
    24. 24. Frameworks and Models<br />Innovation Network Framework<br />Framework used to manage innovation within a large organization<br />Innovation Maturity Model<br />Model to assess the maturity level of the innovation process within an organization<br />17<br />
    25. 25. Innovation NetworkFramework<br />Network with internal and external groups to generate ideas<br />Identify objectives and define metrics<br />Objectives and metrics<br />Business objectives<br />Structural objectives<br />Activity metrics<br />Behavioral metrics<br />Innovation Network Metrics<br />Customer innovation metrics<br />Case Study – P&G<br />18<br />
    26. 26. Case Study<br />19<br />
    27. 27. General Innovation Management<br />Choose appropriate innovation strategy<br />First-mover strategy<br />Fast-follower strategy<br />Conservative slow-follower strategy<br />Alternative innovation strategy<br />Focus innovation on a business imperative<br />Define an innovation process model<br />Organize to accomplish innovation<br />Innovation Maturity Model<br />20<br />
    28. 28. Innovation Maturity Model<br />21<br />
    29. 29. Behaviors<br />Highly Collaborative Environment<br />22<br />
    30. 30. Next Generation Behaviors<br />3 Factors leading to the revolution<br />Web 2.0<br />Net generation<br />Need for uniquely qualified minds<br />Characteristics of the Net-Gen<br />High technology adoption<br />Creativity<br />Social connectivity<br />Diversity<br />Ideagoras<br />Marketplace for ideas, innovation and uniquely-qualified minds<br />Wiki Workforce (Highly collaborative)<br />Collaborative Economy<br />Business – Web<br />More the collaboration better the results<br />23<br />
    31. 31. Boeing 787<br />…Boeing executives concluded that mass collaboration was the only way to create the kind of cheaper, more fuel-efficient jetliner that airlines want…<br />24<br />
    32. 32. Sentiment Analysis<br />Also known as Opinion Mining<br />Determines opinion polarity on a topic<br />Quantifies the qualitative (sentiment)<br />First used for movie reviews<br />Used heavily in marketing analysis<br />Can be used to quantify opinion surveys<br />Commercially available sentiment analysis software<br />25<br />
    33. 33. Recommendations<br /><ul><li>Don’t use Six Sigma for Innovation Activities directly; it stifles creativity.
    34. 34. Identify processes/methodologies used to support innovation and other activities; Use six sigma to improve such processes.</li></ul>Innovation Maturity Model<br />Next generation organizational behaviors<br />Instead of applying Six Sigma in silos, use it for the processes of the entire organization <br />26<br />
    35. 35. Integrated Enterprise Excellence<br />Salil<br />27<br />
    36. 36. Integrated Enterprise Excellence<br />Developed by Forrest W. Breyfogle III, the President and CEO of Smarter Solutions, Inc<br />Uses the familiar Six Sigma DMAIC road map not only at the project level, but at the enterprise level as well. <br />28<br />IEE<br />E - DMAIC<br />P - DMAIC<br />Enterprise Level Roadmap<br />Project Level Roadmap<br />Integrated Enterprise Excellence<br />* DMAIC = define, measure, analyze, improve, control <br />
    37. 37. The Need<br />Where Lean Sigma Falls Short <br /><ul><li>Just another Problem Solving System
    38. 38. Steering committee aims at process improvement and providing certifications
    39. 39. Low hanging fruit gets selected as a goal
    40. 40. Most process improvement techniques often occur in silos
    41. 41. Benefits are not propagated to executive level
    42. 42. In a financial crisis, Lean Six Sigma programs are often downsized</li></ul>29<br />
    43. 43. Integrated Enterprise Excellence (IEE)<br />An enterprise system that provides structure for integrating innovation with analytics<br />30<br />Integrated Enterprise Excellence<br />Six Sigma<br />Balanced Score Cards<br /> Lean <br />
    44. 44. How it Works<br />31<br />
    45. 45. How it Works<br />Step 1: Describe a vision and a mission<br />Step 2: Describe the value chain<br />Step 3: Analyze the enterprise<br />Step 4: Establish goals for satellite-level metrics<br />32<br />Define<br />Measure<br />Analyze<br />Analyze<br />
    46. 46. How it Works<br />Step 5: Create strategies<br />Step 6: Identify high-potential improvement areas<br />Step 7: Identify and execute projects<br />Step 8: Assess the project’s final impact on enterprise goals<br />Step 9 : Maintain the gain<br />33<br />Analyze<br />Analyze<br />Improve<br />Improve<br />Control<br />
    47. 47. How it Works<br />34<br />
    48. 48. Recommendations<br /><ul><li>Do not use Six Sigma for Innovation Activities directly
    49. 49. Identify processes/methodologies used to support innovation and other activities; Use six sigma to improve such processes</li></ul>Innovation Maturity Model<br />Next generation organizational behaviors<br /><ul><li>Instead of applying Six Sigma in silos, use it for the processes of the entire organization </li></ul>35<br />
    50. 50. Weighted criteria analysis<br />John<br />36<br />
    51. 51. Options for Recommendations<br />Passed<br />Failed<br />Keep Six Sigma - Continue using Six Sigma, improve the image of the Six Sigma unit, 1% of all RMS employees<br />Increase Collaboration, Innovation Network Model, Crowd sourcing - Increase collaboration inside and outside the company<br />Do not Integrate Six Sigma and Innovation – Keep separate<br />Implement Integrated Enterprise Excellence (IEE) - Or other forward thinking Six Sigma derived methodology<br />Integrate 'Bike Shop' – i.e. Skunk Works, into the mainstream activities of RMS<br />Hire Consultants - Specializing in Six Sigma and technology, e.g. Thomas Pyzdek, Bain Performance Improvement<br />End of Management - Pyzdek, eliminated because RMS is not facing a crisis<br />Outsource Six Sigma - Only core competencies should be kept in house<br />Guidance and Collaboration with other Raytheon Six Sigma Groups - RMS is not the only division of Raytheon with Six Sigma teams<br />Further Six Sigma Education - Improper education is said to be one of the leading causes of 6S failures<br />Race the Red Queen - Implement adaptive approach, i.e. keep your finger on the pulse of 6S to adapt quickly and take advantage of change<br />37<br />
    52. 52. Criteria Selection Process<br />Raytheon’s Vision, Strategy, Goals, and Values<br />Admiration<br />Respectability<br />Knowledge (leveraging)<br />Broadening focus<br />Customer focus<br />International growth<br />Revenue growth<br />Improved cash flow<br />Predictability<br />Productivity<br />World class employees<br />Performance<br />Conversations with Daniel Kuz and Dr. Jennie Campos<br />Feasibility<br />Cost<br />Innovativeness <br />Long-Term Revenue Growth<br />Short-Term Revenue Growth<br />Brand Image of Six Sigma / Raytheon<br />Employee Satisfaction<br />Values & Behaviors Next Gen Six Sigma Organization<br />Speculative<br />38<br />
    53. 53. Criteria<br />Feasibility<br />Can this option be implemented?<br />Cost<br />Cost to implement; cost/benefit ratio<br />Innovativeness<br />Contribution to Raytheon’s innovativeness<br />Long-Term Revenue Growth<br />Basic need to keep investors happy<br />Short-Term Revenue Growth<br />Basic need to keep investors happy<br />Brand Image of Six Sigma / Raytheon<br />Per company Vision & 6S unit’s needs<br />Employee Satisfaction<br />Per company goals, mission, values & 6S unit image<br />39<br />
    54. 54. Weighted Criteria Matrix <br />40<br />
    55. 55. Recommendations<br />Increase collaboration, innovation network model, crowd sourcing<br />Do NOT integrate Six Sigma with innovation<br />Implement Integrated Enterprise Excellence<br />41<br />
    56. 56. Next Steps<br />Whatever path is decided:<br />Get support from the top<br />Arrange sufficient funding<br />Incentivize employees to encourage change<br />42<br />
    57. 57. Questions<br />43<br />
    58. 58. Appendix<br />44<br />
    59. 59. Collaborators<br />University of Arizona MIS Master’s Project Team<br />Justin Frey<br />Prem Mathiyalagan<br />Salil Deshmukh<br />John Gastreich<br />MIS Faculty<br />Dr. David Pingry<br />RMS Reps<br />Daniel Kuz<br />Dr. Jennie Campos<br />RMS Special Guest<br />Tom Birdsall<br />45<br />
    60. 60. Example Metrics<br />46<br />
    61. 61. Other Sources<br />Myths<br />Myth No. 1: Innovation just happens.<br />Myth No. 2: Innovation only happens in R&D.<br />Myth No. 3: The best innovation comes from inside.<br />Myth No. 4: The more innovative ideas we generate, the better.<br />Myth No. 5: We have lots of smart people, so innovating will be no problem.<br />Innovation Culture<br />Establishing and benchmarking organizational culture<br />Sources<br />Five Myths of Innovation.pdf<br />the_innovation_culture_defin_156182.pdf<br />47<br />