The document provides an overview of Lean Six Sigma, emphasizing its principles of eliminating waste and reducing variation to achieve high-quality outcomes. It discusses the DMAIC (Define, Measure, Analyze, Improve, Control) framework and various tools utilized in the process, such as process mapping, root cause analysis, and failure modes and effects analysis. It highlights the importance of data-driven decision-making and continuous improvement in achieving process excellence.

1. 1
Lean Six Sigma Overview

2. 2
What is Lean Six Sigma?
“Quality depends on good data. It also depends on executive leadership in using
that data.”
- Juran Institute, Inc.

3. 3
What is Lean Six Sigma?
Evolution of Lean Six Sigma

4. 4
What is Lean Six Sigma?
Lean Six Sigma
Lean vs. Six Sigma
-Waste results from
unnecessary steps in
processes
-Five Principles of Lean
-Eight Wastes
-Waste results from
variation within a process
-Kaizen Mistake-Proofing
-A Six Sigma process
achieves 3.4 defects per
million (99.99966% units
that are defect free)
-Focus on
streamlining
processes by
eliminating
waste

5. 5
Lean
“Quality cannot be copied; there is no step-by-step cookbook that applies
equally to all company situations and cultures.”
- Ernst & Young

6. 6
What is Lean Six Sigma?
There are five principles that are applicable
to any process that produces a product or a
service:
1. Focus on Value
2. Identify Value Stream
3. Create Flow
4. Customer Pulls Value
5. Continuously Improve
Five principles of Lean

7. 7
What is Lean Six Sigma?
D
O
W
N
Eight Wastes of Lean
Defects/Re-work
Overproduction
Waiting
Non-utilized
Employees (Intellect)
Transportation
Inventory
Motion
Extra Processing (Over
Processing)
T
I
M
E

8. 8
What is Lean Six Sigma?
Eliminate waste in every day processes- using Lean to improve meeting
effectiveness
Two items can be implemented to improve meeting effectiveness for any meeting;
agendas and minutes
Agendas
• Provide meeting attendees critical information prior to meeting:
 Date, time, duration of meeting
 Purpose
 Intended goals/outcomes
 Topics
 Participants
Minutes
• Record items discussed
• Ensure each item requiring further work is assigned for accountability and document
this
• Summarize and provide to participants in a timely manner

9. 9
Six Sigma
“Observing many companies in action, I am unable to point to a single instance
in which stunning results were gotten without the active and personal
leadership of the upper managers. “
- Joseph M. Juran

10. 10
What is Lean Six Sigma?
The Six Sigma model is derived from the normal distribution:
• A Six Sigma process achieves 3.4 defects per million, in other words, 99.99966% units
that are defect free (considered to be an aggressive goal)
• Focus on achieving consistent process results (reduction of process variation)
• Decision making utilizes verifiable data and statistical methods instead of assumptions
• Requires enterprise-wide commitment to continuous improvement
• Utilizes DMAIC project framework
What is Six Sigma?
1σ
2σ
3σ
4σ
5σ
6σ

11. 11
DMAIC
Define, Measure, Analyze, Improve,
Control
“Measurement is the first step that leads to control and eventually to
improvement. If you can’t measure something, you can’t understand it. If you
can’t understand it, you can’t control it. If you can’t control it, you can’t
improve it.”
- H. James Harrington
“In 2005 Motorola attributed over US$17 billion in savings to Six Sigma”1

12. 12
DMAIC
“Define the problem, improvement activity, opportunity for improvement, the project
goals, and customer (internal and external) requirements”2
Tools and Concepts:
• Logic Maps
• SIPOC
• Voice of the Customer (VOC)
• Critical to Quality Tree
• Kano Model
• SMART Goals
• Cost-Benefit Analysis
• Stages of Team Development
• Gantt Chart
• Stakeholder Analysis
• RACI
• Project Charter
Define

13. 13
DMAIC
Receive Claim
Process Claim
Compile Claims
Error Check
Generate Check
Send Check
Define- SIPOC
Suppliers Inputs Process Outputs Customers
• Hospitals • Medical
Claim
• Payment
Check
• Error Log
• Hospitals
• IT/Audit
Health Insurance Claim SIPOC Example

14. 14
DMAIC
Objective: Convert customer needs into measurable Critical to Quality (CTQ) metrics.
VOC to CTQ Steps:
1. Identify customer
2. Identify customer needs
3. Group needs into themes and identify theme requirements
4. Determine measurable metrics (CTQ)
Examples of Voice of the Customer (VOC) sources:
• Surveys
• Focus Groups
• Complaints
• Competitor Research
• Interviews
• Market Research
Define- VOC to CTQ Metrics

15. 15
DMAIC
Define- VOC to CTQ Metrics (continued)
Exceptional
Customer
Service
Expedient
Claim
Resolution
Courteous
Service
Accurate Claim
Resolution
No Customer
Follow-up
Required
Low Claim
Processing
Time
≤ 1 Customer
Contact Per
Claim
Resolution ≤
Takt Time
3.4 DPMO
Customer Needs
(VOC)
Customer Needs
(Themes)
Customer
Requirements
Measurable
Metrics (CTQ)
Health Insurance Claim Example

16. 16
DMAIC
Staff Auditor Senior Auditor Audit Manager CAE
Create Audit Plan I I C RA
Create Test Plan C R AC I
Test Controls R AC CI I
Issue Report I CI R A
Define- RACI
RACI
Responsible Responsible for majority of work
Accountable Signs off, assigns resources etc.
Consulted Subject matter expert; acts as a resource
Informed Needs kept up-to-date on initiative

17. 17
DMAIC
Define- Gantt Chart

18. 18
DMAIC
“Measure process performance”2
Tools and Concepts:
• Process Maps
• VSM Map
• Time Analysis (Takt)
• Measure Types
• Operational Definitions
• Data Collection Plan
• Measurement System Analysis
• Sampling
• Common vs. Special Cause Variation
• Run/Trend Chart
• Control Chart
• Histograms
• Central Tendency
• Process Capability
Measure

19. 19
DMAIC
Measuring a process provides a “map”
of the process
• Focuses in on how the process is
really done (as-is)
• Provides understanding of the
process for all parties involved
• Shows connections and
dependencies: supplier/customer,
upstream and downstream
Measure- why measure?

20. 20
DMAIC
Measure- process flowcharts

21. 21
DMAIC
Measure- process flowcharts

22. 22
DMAIC
What should be documented?
• Re-work Loops
• Hand-offs
• Delays
• Action Triggers
• Controls
• Decision/Potential Failure Points
• Value and Non-value Added Steps
• Cost of Poor Quality
• Flow Rates/Volume Manual
• Automated Steps
Measure- process flowcharts (continued)

23. 23
DMAIC
0.5
1
1.5
2
2.5
3
3.5
4
4.5
5
5.5
1/2
1/3
1/4
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1/25
1/26
1/27
1/28
1/29
1/30
1/31
ProcessingTime(min)
Date
Claim System Processing
Measure- histograms

24. 24
DMAIC
“Analyze the process to determine root causes of variation, poor performance
(defects)”2
Tools and Concepts:
• 8 Elements of Waste
• VA/NVA
• Brainstorming Tools
• Ishikawa Diagram
• 5-Why Analysis
• Pareto Analysis
• Control/Impact (CI) Matrix
• Scatter Plots
• Linear Regression
• Hypothesis Statements & Testing
Analyze

25. 25
DMAIC
A.K.A.- Fishbone Diagram and Cause and Effect Diagram
Analyze- Ishikawa Diagram
Problem
Statement
Measurements People Procedures
Policies Technology Environment
Cause
Sub-Cause
Sub-Cause
Cause
Sub-Cause
Sub-Cause
Cause
Sub-Cause
Sub-Cause
Cause
Sub-Cause
Sub-Cause
Cause
Sub-Cause
Sub-Cause
Cause
Sub-Cause
Sub-Cause

26. 26
DMAIC
What is it?
• 5 why analysis involves looking at any problem and asking “why?” and “what caused
this problem?”
• Helps determine root cause
• Made popular by Toyota (developed by Sakichi Toyoda)
• It changes the way people think and make decisions in an organization
Analyze- 5 why analysis
Why?
• The Washington
Monument is
disintegrating
Why?
• Harsh chemicals used to
clean it
Why? • To remove
pigeon waste
Why? • Pigeons eat spiders at
monument
Why?
• Spiders eat gnats
at the monument
Why?
• Gnats attracted to
monument lights

27. 27
DMAIC
Analyze- Pareto Analysis

28. 28
DMAIC
“Improve process performance by
addressing and eliminating the root
causes”2
Tools and Concepts:
• ESSA
• Push vs. Pull Production
• Impact/Effort 2x2 Matrix
• Decision-Analysis Matrix
• Future State Map
• Implementation Plan for Pilot
• FMEA
• Mistake Proofing (Poka-Yoke)
• Value Quantification
• Kaizen
• 5S
• Plan Do Check Act
Improve

29. 29
DMAIC
Eliminate
Process Wastes
• Identify wastes in the
process
• Identify issues with
process
• Identify anything that
adds cost or time
without adding value
Simplify & Standardize
Process Flow
• Ensure consistent
capability
• Provide for consistent
application and
availability of resources
(people, material and
equipment)
• Maintain reliability of
processes
Improve- ESSA (Eliminate-Simplify-Automate)
Automate Process
Activities
• Use technology to add
value to process
• Use technology to
eliminate waste
• Use technology as an
aid to continuous
improvement

30. 30
Priority 1
DMAIC
Improve- 2x2 Impact/Effort Matrix to prioritize analysis
• Focus on options A, D and E
immediately
• Plan for difficult/high impact
option C
• Reconsider if B is still a viable
option
Priority 3
Priority 2
B
D A
E
C
Effort
Degree of Impact/Return
Low High
LowHigh
Low Priority
Reconsider
Just do it
Complex but worthwhile
A Option A
B Option B
C Option C
D Option D
E Option E
• Most common axes are Effort vs. Impact
• Other axes include risk, speed, profitability, etc.

31. 31
DMAIC
• A systematic way to evaluate and prioritize the operational risks and potential failures
of a process or product
• Method to assess and plan for problems which could impact safety, reliability,
customer satisfaction, profits, etc.
 Failure Modes= types of possible error or defect
 Looks at common or rare events and relative risk
• Also a tool for process owners to allocate measurement and prevention resources
(control)
• Promotes consideration for questions like:
 “What could go wrong with the process or product?”
 “How badly might it go wrong?”
 “What needs to be done to prevent failures?”
Improve- Failure Modes and Effects Analysis (FMEA)

32. 32
DMAIC
Why use FMEA?
• Focuses processes on “prevention” rather than “fire fighting”
• Evaluates risk based on three criteria:
 Severity: Consequences if failure does occur
 Occurrence: Likelihood failure will occur over time, given a certain number of
opportunities
 Detection: Probability failure could be detected promptly before it occurs
• Promotes better solution implementation and more proactive ongoing management
Improve- Failure Modes and Effects Analysis (FMEA continued)

33. 33
DMAIC
FMEA Steps:
1. Identify potential problems or “failure modes”
• Focus on critical or complex steps, key requirements
• List the potential “failures”
2. Rate each: Severity, Occurrence and Detectibility
• 1 to 10 scale (10 meaning “worst case”)
• Helps to “operationally define” the scale
3. Calculate the risk-priority number (RPN)
• Multiply Severity x Occurrence x Detection (max =
1,000)
4. Focus prevention, contingencies and/or alarms on
highest priority areas
Improve- Failure Modes and Effects Analysis (FMEA continued)

34. 34
DMAIC
Improve- Failure Modes and Effects Analysis (FMEA continued)
Prepared by:
FMEA Start Date:
Core Team:
Actions
Taken
Sev
Occur
Det
RPN
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Actual End
Date
Action Results
Failure Modes and Effects Analysis
Target End
Date
Potential
Effect(s) of
Failure
Sev
Potential
Cause(s)
Current
Control(s)
Det
RPN
Recommended
Action
Responsibility
Occur
Step #
Process
Function
Potential
Failure Mode

35. 35
DMAIC
Poka-Yoke is a concept of error proofing processes that consists of:
• Anticipating problems to make processes “fail-safe”
• Allowing for preventative actions to be a part of process design
Error Proofing Techniques
• Elimination to prevent the possibility of an error
• Control/automation to self-correct processes
• Shut down the process when an error occurs
• Alerts/warning signals when something has gone wrong
• Statistical Process Control (SPC) to graphically monitor process
• Standard Operating Procedures
• Training and Awareness for new people or new procedures
Improve- Mistake proofing (Poka-Yoke)
Most Effective
Least Effective

36. 36
DMAIC
Improve- 5S
5S is a methodology for creating and maintaining an organized,
clean, high performance workplace. It’s also a process of
maintaining discipline and order as well as reducing waste and
errors
Components:
1. Sort: Get rid of what is not needed; only required items are
stored in that location
2. Set-in-order: Arrange everything such that it is easy to
locate, use and replace
3. Shine: Clean daily
4. Standardize: Guidelines and practices for sort, set-in-order
and shine are established and followed consistently
5. Sustain: Ensure that 5S activities become a habit that
everyone performs continually.

37. 37
DMAIC
“Control the improved process and
future process performance”2
Tools and Concepts:
• Process Control Plan
• Visual Management/Dashboards
• Control Charts
• Documentation: Maps and SOPs
• Response Plans
• Change Management
Control

38. 38
DMAIC
1. Processes defined and measured
2. Measures of key indicators defined
• Leading indicators- metrics that mainly refer to future developments &
drivers/causes
• Lagging indicators- metrics that mainly refer to the past developments &
effects/results
3. Regular assessment of performance
• Customer, financial, process, people, innovation
• Capability and (statistical) control
4. Appropriate, proactive, timely response
• Corrective action, quick fixes
• DMAIC improvement & design/redesign as needed
5. Management of flow and function
• Solution and/or process ownership, governance
• Cross-functional, cross-process coordination
Control- Setting up a control plan

39. 39
DMAIC
Control- Setting up a control plan
Control plans focus attention on a balanced set of factors important to the customer
(CTQs) and the business
• Prevention: Eliminating variation and insulating the process from special cause
disruptions
• Early Detection: Identifying a potential problem or cause (X) prior to it becoming
a problem, prompting proactive efforts
• Quick & Effective Response: Detecting problems in key performance factor
(outcome or Y) and taking immediate corrective/contingent action

40. 40
DMAIC
Control Plan Elements:
• Process Map
 Show interfaces to other processes
 Use annotation and reference notes
• Monitoring
 What’s the measure (not every step)?
 What’s the requirement or standard?
 How’s the data gathered?
 How’s the data displayed (control charts)?
• Response Plan
 How do we take quick action?
 What’s our path for moving to DMAIC?
Control- Setting up a control plan

41. 41
DMAIC
A Response Plan is part of your overall Process Control Plan and is used when an input,
process or output measure indicates an out-of-control condition. The goal of a
response plan is to ensure your gains or achievements can be maintained
• Examine each key step in the process
 Entire SIPOC
 Use revised process map (the new “as-is”)
• Apply preventative planning to anything that could go wrong
 How would we respond (contingency plan)
 Who would be responsible?
• Set “trigger” measures
 What would warrant a response?
• Document the plan and associate it to your FMEA
 Close the loop
 Key ingredient for process management
Control- Building response plans

42. 42
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