Overview of Lean Manufacturing and Six Sigma tools, comaprison between Lean Speed and Six Sigma Quality combining Lean with Six Sigma Overview of DMAIC and SIX SIGMA FORMULA

1. Prepared by Julian Kalac, P.Eng
Lean Six Sigma Master Black Belt
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The systematic elimination of waste and re- alignment of resources to deliver value to the customer faster, better, & more consistently
Lean in Manufacturing:
◦Focus: Eliminate waste, non-value add steps, process constraints and bottle necks that cause problems in work throughput
◦Approach: Intuitive and broad - “inch-deep, mile wide”
Leading to
Leading to
Eliminate Waste
Reduced Cycle Times
Increased Capacity

3. Value Added
Typically 95% of all lead time is non-value added
1.Overproduction
2.Waiting
3.Transportation
4.Non-Value Added Processing
5.Excess Inventory/Material
6.Defects
7.Excess Motion
8.Underutilized People
Non-Value Added
5%

4. | | 4
Lack of cross-functional training
Over relying on a select few while others are Inadequately trained
Operators are unable to rotate and help each other out to balance the work- load
High overtime, increased pressure stress

5. Cycle Time is dictated by the slowest (bottleneck) operation in the cell.
40 min
20 min
25 min
15 min
30 min
1
5
4
3
2
•What operation controls the cycle?
•How can you relieve the bottleneck?

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Cellular Concepts
1)CELL OPERATIONS
–Bottleneck Management:
•Maintain buffer in front of bottleneck
–(never starve the bottleneck !)
•Improve bottleneck operation
•Cross train on bottleneck
–Creates a visual work place
–Continuous Improvement
–Cell Support
–Balance activities / operations

7. KANBAN
◦A signal to produce
◦Signal can be an empty square, bin, shelf, cart, or kanban card
◦Kanban qty is safety stock used while new order is delivered
◦Kanban qty is calculated based on usage, lead time, delivery time
◦Can be setup manually or automated
◦Can extend through electronic notification to suppliers using automatic messaging and triggers

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9. SETUP TIME
◦Starts when last piece of previous job is complete; ends when first good piece of next job is complete
INTERNAL SET-UP: While machine is shut-down Goal is to reduce Internal setup time, less= better
EXTERNAL SET-UP: While machine is working
◦Goal is to transfer internal setup activities and increase external setup time, more= better

10. Poke yoke = Error Proofing
Eliminate/minimize chance for human error
to avoid mistakes
◦Prevention Poke Yoke
Stops the process before failures occur
Does not allow defects to pass through the process

11. VA/NVA Ratio= 46% DPU = ____ RTYield = _____
SCORE CARD:
I’m going to have coffee
Fill c.
maker
with
water
Scoop
Coffee
into
c. maker
Get & place Filter in c. maker
Drink
coffee
Is taste OK
Brew coffee
Pour c.
into cup
Add cream & sugar
Water Supply
Process
Shopping
Process
Electricity Supply Process
Eating
Equipment
Supply
Process
Tasting Process
Housekeeping Processes
Transactional &
Support Processes
Process Data & Information
NVA = Non-value Added Time VA = Value Added Time
VA Time
NVA Time
Temp of Water= ___
Quality of Water= ___
Pressure of Water= ___
Amount of Coffee= ___ Quality of Coffee= ___ Type of Coffee= ___ Defective Coffee= ___
60 sec
30 sec
60 sec
360 sec
10 sec
60 sec
10 sec
10 sec
5 sec
600 sec
30 sec

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The Five Principles of “Lean Thinking”
1.Define value from the perspective of the Customer
2.Map the value stream
3.Get the stream to “flow” by eliminating waste
4.Allow the customer to “pull” value from the stream
5.Pursue perfection (continual improvement)

13. INSANITY --“Doing the same thing over and over again and expecting different results” Albert Einstein
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Lost managemant
time cost
Maintenance
cost
Lost opportunity
Lost assets cost
Rerun cost
Lost
business,
goodwill cost
Lost
credibility
cost
Prevention cost
appraisal cost
Project
rework cost
Litigation
SS Titanic
Management
Waste Costs:
Costs driven by problems and process steps that add no value
to products & services delivered to customers
Appraisal Costs:
Costs incurred to determine the degree
of conformance to customer needs
Prevention Costs:
Costs incurred to keep failure and
appraisal costs to a minimum
Failure Costs:
Costs directly incurred
due to defects internal
to the system or after
delivery to the
customer

15. THE PROCESS
PROCESS
OUTPUTS
CONTROLLED
VARIABLES
CUSTOMER
PROCESS
INPUTS
UNCONTROLLED
NOISE
VARIABLES
Process and Its Variables

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σUse data-driven, measurement-based, statistical methods to Solve problems, improve performance
σFocus: Surgical “inch-wide, mile-deep” investigation and resolution
σApproach:
σSolve problems at the system and root cause level
σImplement robust control plans for sustained improvements
What is “Six Sigma”? An Analytical Methodology that Focuses on Reducing Process Variation

17. 1
( )2


 
n
xi x

Sigma =  = Deviation 
( Square root of variance )
-7
-6
-5
-4
-3
-2
-1
0
1
2
3
4
5
6
7
Axis graduated in Sigma
68.27 %
95.45 %
99.73 %
99.9937 %
99.999943 %
99.9999998 %
result: 317300 ppm outside
(deviation)
45500 ppm
2700 ppm
63 ppm
0.57 ppm
0.002 ppm
between + / - 1
between + / - 2
between + / - 3
between + / - 4
between + / - 5
between + / - 6
 =

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•Identify customer metrics
•Select performances standards
•Select objectives
•Map the process
•Validate measurement System (MSA)
•RESULT: Process maps and good quality data collected by listening to the process
•Identify sources of variation & failure points
•Redefine and Re-prioritize
•Establish process capability
•Identify improvement opportunities
•RESULT: The critical sources of variation identified root causes determined
•Monitor processes to prevent recurrence of variation, defects and non-value work
•Maintain performance levels
•find more creative ways to improve
•fix root causes
•Find/Implement Preventive Fixes
•Deploy changes organization
•RESULT: Performance is more predictable ; culture changing
•Plan and apply Improve Tools to fix problems and reduce variation
•Implement improvement opportunities
•RESULT: Improve tools applied, changes implemented and performance improvement in place
DMAIC Improvement Model
A Road Map for guiding Improvement Projects
•Identify customer problems
•Identify performances standards
•Identify improvement objectives
•Link problem to the key performance metrics
•Find the right problems
•RESULT: Problem Statement & Project Charter DefineMeasureAnalyzeImproveControlResultsDefineMeasureAnalyzeImproveControlResults

20. To understand where you want to be, you need to know how to get there.v
Map the Process
Measure the Process
Identify the variables - ‘x’
Understand the Problem -
’Y’ = function of variables -’x’
Y=f(x)

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2) Clearly Define your Problem and the Impact
Example:
Too many mistakes in purchase request specifications are causing rework rates of 34%, high costs and late deliveries (less than 50% on time) to our customers
1) Find
• Customer Issues
• Performance
Reviews
• Meetings
• New Projects
• Failures, Re-work
• Projects
• Continuous improvement activities
• Champions
• Stakeholders
• Employees
• SCOR Maps
• Research
• Brainstorm
• Wait until the crisis hits you
• Value Stream Maps
3) Clearly State the Initial Scope for your project
(Set targets and timelines!)
Example:
This first phase of this project – by 3Q 2004 - will identify problems and root causes in the purchase request process, increase first pass yield rates to 95%, reduce the cost of poor quality by 50% and increase on-time deliveries to our customers to greater than 90%
4) Link improvement targets to customer needs and organizational objectives
5) Project Plan – Charter, Resources, Milestones

22. 2
2
Process Flow
for Measure Phase
Data
Storage
and
Archiving
Foundations for Wisdom and good decision
making start with Good Data
What data do we need?
Can we use “old” historical data?
Is old data (still) usable?
How was it collected?
Wisdom
Knowledge
Data
Information
Data Selection
Data Integrity Analysis
Data Collection
Measurement System Analysis
Process Mapping

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X1 = _____
Y1 = _____
X2 = _____
Y2 = _____
X1 = _______
Y1 = _______
X2 = _______
Y2 = _______
X3 = _______
Y3 = _______
SIPOC Diagrams can be characterized as a 3-step, high-level (“30,000-foot) Process Flow Diagram for a process
Critical to Customer Quality Requirements
(the “CTQ’s)
Key Inputs (Materials & Resources) and Key Process Input Variables
(KPIV’s)
Inputs Processes Outputs
Supplier Customer
Secondary Metric
(e.g. Field Returns)
Primary Metric
(e.g. Scrap $/Month

24. Is your error in the process or in the way you measure it?
Could it be that you actually are “good” but the error in the measurement system shows that you are not “good”?
Overall Variation
Occurrence-to- Occurrence ( or Piece- to-Piece) Variation
Measurement System Variation
Repeatability:
Variation due to gage or measurement tool
Reproducibility:
Variation due to people or operators who are measuring
2Total = 2Part-Part + 2R&R

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Organize & Understand your data
Statistical Analysis
Determine significant factors
Sort, Collate, Investigate your data
Organize your data and put it into some sort of
perspective, concept, picture or visual
representation that is easier to understand
Use maps, graphs, charts, summaries, spread
sheets, etc., that organize the data
Wisdom
Knowledge
Data
Information

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We know we must change X to create a change in Y…
But how do we know which Xs to change
and how to change them ?
Y =f (x1, x2, …)
process output key process input factors
affecting process output
function of

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P value< 0.5--Significant

28. Statistical Analysis
0.000 0.005 0.010 0.015 0.020 0.025
7
6
5
4
3
2
1
0
New Machine
Frequency
0.000 0.005 0.010 0.015 0.020 0.025
30
20
10
0
Machine 6 mths
Frequency
 Is the factor really important?
 Do we understand the impact for
the factor?
 Has our improvement made an
impact
 What is the true impact?
Hypothesis Testing
Regression Analysis
5 15 25 35 45 55
60
50
40
30
20
10
0
X
Y
R-Sq = 86.0 %
Y = 2.19469 + 0.918549X
95% PI
Regression
Regression Plot
Apply statistics to validate actions & improvements
P value< 0.5--Significant

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The minimum sample size required to provide exactly 5% overlap (risk). In order to distinguish the Delta.
Note: If you are working with Non- normal Data, multiply your calculated sample size by 1.1
40
50
60
70
40
60
70
50
Population
P value< 0.5--Significant

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Normal
Test of Equal Variance
1 Sample t-test
1 Sample Variance
Variance Not Equal
Variance Equal
2 Sample T
One Way ANOVA
2 Sample T
One Way ANOVA

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PROBLEM
FINDING
FACT
FINDING
PROBLEM
DEFINITION
IDEA
FINDING
EVAL. &
SELECT
PLAN
ACCEPT
-ANCE
ACTION
1
2
3
4
6
7
8
5
Select
Tool
Analyze Data & Information
Apply tools & Make Changes
Six
Sigma
Projects
5S
PM/TPM
TQM
Rapid Improve-
ment Event
Integrated
Process
Team (IPT)
Establish Baselines/Metrics
Other CI
Tools
Kanban
DFSS
Apply the Tool
(1)
(2)
(3)
Implement / Deploy Fixes
(0) Identify failure points, bottlenecks and improvement opportunities from Define-Measure-Analyze Phases
PM = Preventive Maintenance
TPM = Total Productive Maintenance
CI = Continuous Improvement
DFSS = Design for Six Sigma
TQM = Total Quality Management

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Maintaining and Improving Control:
Managing Change
Quality Management Systems
What’s Left? What’s Next?
Control Tools:
•POKA YOKE
•Control Charts
•Statistical Process Control (SPC)
Document Procedures and Best Practices
Create Visual Controls and “Dashboards”
Update
Deployment Plan
Complete Control FMEA
Update and Deploy
Communication Plan
Execute Deployment Plan
Document Other Opportunities
Prepare and Implement Control Plan
Report out, Hand- off and Closure
Prepare and Implement Training Plan
Process Flow Diagram for Control Phase:

34. Lean Manufacturing = SPEED
focusses on reducing waste/Non-Value Add activity and “Speeding” up the Process cycle Times.
Six Sigma = QUALITY 3.4 PPM
focusses on improving quality, reducing process variation
Six Sigma “Quality”+ Lean “Speed" =
PERFORMANCE
34

35. Lean manufacturing v Six Sigma Tools
Lean Manufacturing
1)Value Stream Mapping
2)Line Balancing
3)Continuous Flow
4)PULL system
5)KANBAN
6)Set Up reduction (SMED)
7)Poke Yoke/Error Proofing
8)5S
Six Sigma
1)DMAIC, SIPOC process
2)Gage R&R
3)FMEA
4)Hypothesis Testing
5)Regression
6)Statistical Analysis
7)Process Capability Cp, Cpk
8)Roll Throughput Yield
9)Design of Experiments
10)Control Charts
35

36. What are the Methods and Tools?
“Lean” focuses on:
The systematic elimination of waste
and re-alignment of resources to
deliver value to the customer faster,
better, & more consistently
Supply Chain Management:
Mapping your processes
through the entire business
enterprise with standard elements
“Six Sigma” focuses on:
Use of analytical and methodical fact based
problem solving methods
Drastically reduce variation then control and
manage whatever variation is left over
Increase predictability, accuracy and precision
Product and Services
Cash/Funding
Information
Customer’s
Customer
Supplier’s
Supplier
Supplier Your Company Customer
Plan
Make Source Make / Deliver
Repair
Deliver Source Deliver Source Make Deliver Source
Return Return Return Return Return Return Return Return
Plan Plan
LSL Ẋ USL
Theory of
Constraints:
Find & eliminate
the bottle necks
Business
Process Re-engineering:
Start over
VA Time
NVA Time
FLOW

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Kaizen Events
& TPM
SPC
Six Sigma (GB &BB)
D.O.E
Which Tools
to Apply
Intuitive/
Common
Sense
Data
Driven
Non-
Value
Added
Value
Added
Type of
Variation
Special
Cause
Variation
Common
Cause
Variation
Lean
vs
6
95%
vs
5%
CONTINUUM
5S
PIT & Brainstorming
Creative Problem Solving
Process
Content
Where do Visual Displays Fit In?
Visual Displays Identify and Communicate Where You Are

38. 38
Kaizen Events
& TPM
SPC
Six Sigma (GB &BB)
D.O.E
Which Tools
to Apply
Intuitive/
Common
Sense
Data
Driven
Non-
Value
Added
Value
Added
Type of
Variation
Special
Cause
Variation
Common
Cause
Variation
Lean
vs
6
95%
vs
5%
CONTINUUM
5S
PIT & Brainstorming
Creative Problem Solving
Process
Content
Where do Kaizen Events Fit In?
© Ci2 2009

39. 39
Kaizen Events
& TPM
SPC
Six Sigma (GB &BB)
D.O.E
Which Tools
to Apply
Intuitive/
Common
Sense
Data
Driven
Non-
Value
Added
Value
Added
Type of
Variation
Special
Cause
Variation
Common
Cause
Variation
Lean
vs
6
95%
vs
5%
CONTINUUM
5S
PIT & Brainstorming
Creative Problem Solving
Process
Content
Where do Green Belt/Black Belt Projects Fit In?
© Ci2 2009

40. Numbers, words, quantities, values stored sitting in piles or queues waiting for future use
Charts, summaries, spread sheets, etc. that organize the data
Presentations, plans and tools that explain and communicate the information
Processes, organizations and team using the information to improve, manage, build systems and develop cultures
Push the data “up” to become Wise
Always loop back to check the data
Wisdom
Knowledge
Data
Information
Where are you looking from?
The WISDOM TOWER: Changing Perspectives