© Copyright Jean-Marie Cote SIX SIGMA

© Copyright Jean-Marie Cote© Copyright Jean-Marie Cote

SIX SIGMA SIX SIGMA A STRATEGIC TOOL A STRATEGIC TOOL

SLA – Toronto June 2005SLA – Toronto June 2005

Jean-Marie CoteJean-Marie Cote

Master Black BeltMaster Black Belt

© © Copyright Jean-Marie CoteCopyright Jean-Marie Cote

TOPICSTOPICS

Historical BackgroundHistorical Background What is Six Sigma?What is Six Sigma? The MethodologyThe Methodology

ToolsTools Practical Case StudyPractical Case Study

Business StrategyBusiness Strategy


1. Motorola (1987)

2. Texas Instruments (1988)

3. IBM (1990)

4. ABB (1993)

5. AlliedSignal / Kodak (1994)

Historical BackgroundHistorical Background

6. GE (1995) - A decisive turning point!!!6. GE (1995) - A decisive turning point!!!

7. Lockheed Martin, Bombardier, & Navistar (1996/97)

8. PACCAR (1998)

9. Amazon.com (1999)

10. Ford Motor Company (2000)

“Six Sigma” as a buzzword can trace itsorigins to Motorola.

The concept that Six Sigma embodiesgoes back much further.

Have they all been successful?Have they all been successful?


DRIVING BUSINESS EXCELLENCEDRIVING BUSINESS EXCELLENCE

THE SIX SIGMA UMBRELLATHE SIX SIGMA UMBRELLA


Different Names But Same Flavor…Different Names But Same Flavor…

Operation ExcellenceOperation Excellence Lean ManufacturingLean Manufacturing Lean Operations Lean Operations Lean Six SigmaLean Six Sigma TPS (Toyota Production System)TPS (Toyota Production System) High Impact KaizenHigh Impact Kaizen Complexity ReductionComplexity Reduction

Six Sigma in its today’s broadest definition means:Six Sigma in its today’s broadest definition means:

““Continuous Improvement in a Structured Approach”Continuous Improvement in a Structured Approach”


What is Six Sigma? What is Six Sigma? One View.One View.

Six Sigma is a comprehensive and flexible Six Sigma is a comprehensive and flexible systemsystem for achieving and sustaining for achieving and sustaining

business excellence. business excellence.

Six Sigma is uniquely driven by:Six Sigma is uniquely driven by:(1)(1) A close understanding of customer needs and wants A close understanding of customer needs and wants (2)(2) The disciplined use of facts, data and The disciplined use of facts, data and statistical statistical analysis analysis (3)(3) Diligent approach in problem solvingDiligent approach in problem solving


Six Sigma in Other WordsSix Sigma in Other Words

Quote from W. Edwards Deming:

When you measure, you can understand When you understand, you can control When you control, you can improve When you improve, you can achieve your goal


What is “Six Sigma”?What is “Six Sigma”?

A Statistical A Statistical MeasureMeasure of Performance of Performance

A Rigorous Analytical A Rigorous Analytical ApproachApproach for: for: Process Variation ReductionProcess Variation Reduction Complex Problem SolvingComplex Problem Solving Waste ReductionWaste Reduction

AA PhilosophyPhilosophy That Higher Quality Results In That Higher Quality Results In

- Increased Efficiency- Increased Efficiency - - Business Excellence Business Excellence - Enhanced Customer Satisfaction- Enhanced Customer Satisfaction

3 Short Definitions:


What “Six Sigma” is NOTWhat “Six Sigma” is NOT It is not just statisticsIt is not just statistics

Statistics is a tool, not an Statistics is a tool, not an end in itselfend in itself

It is not a rigid, mechanical It is not a rigid, mechanical approach approach

Six Sigma is flexible and can Six Sigma is flexible and can adjust to the business needsadjust to the business needs

It is not a panaceaIt is not a panacea Six Sigma is not suited for Six Sigma is not suited for

every situationevery situation

It is not magicIt is not magic


Why Is It Called “Six Sigma”?Why Is It Called “Six Sigma”?

Sigma or standard deviation is a statistical term used by statisticiansSigma or standard deviation is a statistical term used by statisticians It is a measure of process performanceIt is a measure of process performance

6 standard deviations (sigma) from process center to the nearest specification limit

UpperRequirement

LowerRequirement

We are comparing performance to requirements.


Doing It Right the first Time and Every TimeDoing It Right the first Time and Every Time


A Six Sigma Process Aims at Zero DefectA Six Sigma Process Aims at Zero Defect


PracticalPractical Meaning of Six Sigma PerformanceMeaning of Six Sigma Performance(Why 99% Good is often not “Good Enough”)(Why 99% Good is often not “Good Enough”)

99% Good 99.9997% Good

U.S. Postal System

20,000 Lost Articles Of Mail every hour 7 Lost Articles every hour

Football Kicker

4,100 misses in 500,000 attempts < 2 misses in 500,000 attempts

Baggage Handling System – Houston Airport

20,000 Lost bags per Day < 5 Lost bags per day

Delta Airlines (1) : Currently: $100M / year for mishandled luggage (98.75% good)Six Sigma: $25,000 / year (99.9997%)

(1) Airport Equipment & Technology, 2005 p.10 by John Croft


The Right PeopleThe Right People

Black BeltsBlack Belts Black BeltsBlack Belts Black BeltsBlack Belts

Green Green BeltsBelts




Building Capability to Drive ExcellenceBuilding Capability to Drive Excellence

Six Sigma Champions

Master Black Belts


Six Sigma Six Sigma MethodsMethods

Six Sigma Applies Everywhere!Six Sigma Applies Everywhere!

MFG.

DESIGNSERVICE

PURCH.

MAINT. ITD

QA

FinanceFinance

SALES


The Breakthrough Strategy –The Breakthrough Strategy –

DMAIC & DMADVDMAIC & DMADV

MeasureMeasure

AnalyzeAnalyze

Improve / DesignImprove / Design

Control / ValidateControl / Validate

DefineDefine

A cookbookA cookbookfor for

improvement!improvement!


DEFINE PHASEDEFINE PHASE

Project Selection Must :Project Selection Must : Be in line with the business strategyBe in line with the business strategy Target customers needs and wantsTarget customers needs and wants Add value to the processAdd value to the process WELL DEFINEDWELL DEFINED

• BaselineBaseline• MeasureMeasure• GoalGoal• Time LineTime Line


PROJECT DEFINITIONPROJECT DEFINITION

A PRACTICAL EXAMPLE:A PRACTICAL EXAMPLE: Issue:Issue: The Response Time to Customer Request The Response Time to Customer Request

takes to longtakes to long Problem Statement:Problem Statement: Response Time to Customer Response Time to Customer

Request Takes an Average of 3.2 daysRequest Takes an Average of 3.2 days Objective:Objective: Average Response Time to Customer Average Response Time to Customer

Request Must Be 1.2 days (2 days reduction).Request Must Be 1.2 days (2 days reduction).


MEASURE PHASEMEASURE PHASE

Understanding The Process:Understanding The Process: Process Characterization Using Soft ToolsProcess Characterization Using Soft Tools

ObjectivesObjectives Gather Data to Create KnowledgeGather Data to Create Knowledge Refine the ProjectRefine the Project Identify NVA (Non-Valued Added Activities)Identify NVA (Non-Valued Added Activities)


MEASURE PHASEMEASURE PHASE

Refining the Project:Refining the Project: Statement: It takes in average 3.2 days to answer Statement: It takes in average 3.2 days to answer

customer request.customer request. Findings:Findings:

• 10% of the requests are processed within a day10% of the requests are processed within a day

• 20% of the requests are incomplete20% of the requests are incomplete

• 70% of the requests are improperly routed through 70% of the requests are improperly routed through the systemthe system

Defect Definition: Every time a request is improperly Defect Definition: Every time a request is improperly routed in the system.routed in the system.


SIX SIGMA TOOLSSIX SIGMA TOOLSMEASURE/ANALYSEMEASURE/ANALYSE

THE SOFTTHE SOFT

AND AND

THE TOUGH THE TOUGH (1)(1)

(1) Translation: “The Beauty and The Beast”


THE SOFT TOOLSTHE SOFT TOOLS

Process Map (IPO)Process Map (IPO) If you cannot map the process you don’t understand itIf you cannot map the process you don’t understand it If you don’t understand it, you cannot improve it.If you don’t understand it, you cannot improve it.

Cause & Effect Matrix (QFD)Cause & Effect Matrix (QFD) The “What” and “How”The “What” and “How” ““What” the customer wants and “How” we are addressing itWhat” the customer wants and “How” we are addressing it

Cause & Effect Diagram (Fishbone)Cause & Effect Diagram (Fishbone) What we What we “think”“think” is driving the issue is driving the issue

Waste Elimination ToolsWaste Elimination Tools Value Stream MapValue Stream Map Process FlowProcess Flow

Pareto and Time ChartsPareto and Time Charts

QFD: Quality Functional Deployment


Process Map ExampleProcess Map Example

Information

AnalysisBooksMagazinesWeb SearchesEnvironmentDatabasesSuppliersAnalyst

Knowledge

Input Output

ServiceService


Input/Output CharacteristicsInput/Output Characteristics

Input/Output Must Be CharacterizedInput/Output Must Be Characterized Each Characteristics Must be Weighted in Relation Each Characteristics Must be Weighted in Relation

with the Goal or the Issue.with the Goal or the Issue. Critical Characteristics must be measured.Critical Characteristics must be measured. The Number of Characteristics Must be Manageable.The Number of Characteristics Must be Manageable.

Example:Example: Type: electronic or paperType: electronic or paper Shape: round or rectangularShape: round or rectangular Volume: small or largeVolume: small or large Color: white or blackColor: white or black


EXERCISEEXERCISE

A SMALL CAR WASH BUSINESS:A SMALL CAR WASH BUSINESS: Issue: Customer’s complaints Issue: Customer’s complaints

• Small damages to their carsSmall damages to their cars• Streak and dull spot (not very clean)Streak and dull spot (not very clean)

The question is: Why?The question is: Why?

Let’s map the process….Let’s map the process….


Process MappingProcess MappingWashing Your CarWashing Your Car

Prepare Material

Rinse Car

Wash Car

Dry/Polish Car

Rag/SpongeHot Water /SoapBucketDirty Car

Material Ready

Hot Soapy Water

Material Ready

Hot Soapy Water

Clean Soapy Car

Cold Dirty Water

Dirty Rag

Clean Soapy Car

Clean Water

Clean Wet Car

Dirty Rag

Dirty Water

Clean Wet Car

Clean/Dry RagClean Dry CarClean Dry Car

No DamageNo Damage

INPUTS OUTPUTSPROCESS


Input/Output CharacteristicsInput/Output Characteristics

Input/Output Must Be CharacterizedInput/Output Must Be Characterized Each Characteristics Must be Weighted in Relation Each Characteristics Must be Weighted in Relation

with the Goal or the Issue.with the Goal or the Issue. Critical Characteristics must be measured.Critical Characteristics must be measured. The Number of Characteristics Must be Manageable.The Number of Characteristics Must be Manageable.

Example: the bucket to wash the car - Example: the bucket to wash the car - Material: plastic or steelMaterial: plastic or steel Shape: round or rectangularShape: round or rectangular Volume: small or largeVolume: small or large Color: white or blackColor: white or black


Main Library Not a Destination

Homeless

Population Density

Businesses

Isolation

Downtown Area

Vision

Sticky Factors

Leadership

Experience

Culture

AV Rental

Cinema

Book Stores

Activities

Internet

Branches

Novelty

Display

Selection

Accessibility

Availability

Parking Cost

Floor Layout

Atmosphere

Public Transport

Location

Training

Sticky Factors

Culture

Motivation

Creativity

Initiative

Staff

Building

Materials

Alternatives

Management

Environment

Main Library C & E Diagram


Rating of Importance 9 10 5 7 10 7

1 2 3 4 5 6

How?

On

-Lin

e L

ibra

ry

Exp

ert

An

aly

st

Tech

Pu

bli

cati

on

Up

-to

-Date

Mate

rial

Info

. M

an

gem

en

t S

yste

m

Exp

ert

Syste

m

Total

What?1 Timeless Information 9 9 7 7 9 1 352

2 Consistent Service 5 9 5 7 9 5 334

3 Value Added Information 9 9 5 7 5 5 330

4 Reliable Information 1 9 1 9 9 5 292

5 Prevention of litigation 1 9 1 9 1 9 240

6 0

7 0

8 0

Total 225 450 95 273 330 175

Cause and Effect Matrix


THE TOOLS THE TOOLS

THE LOW HANGING FRUIT FIRST:THE LOW HANGING FRUIT FIRST:

VALUE STREAM MAPPINGVALUE STREAM MAPPING KAIZEN APPROACHKAIZEN APPROACH

• Eliminating waste and non-value activitiesEliminating waste and non-value activities LEAN MANUFACTURINGLEAN MANUFACTURING

• Focus on optimizing layout, processes and work Focus on optimizing layout, processes and work sequencesequence


Put Another Way...Put Another Way...

Value-Added: Activities performed to meet Value-Added: Activities performed to meet customer requirements.customer requirements. ““What the customer values is not the service but What the customer values is not the service but

what the service does for him”what the service does for him” Non-Value Added: Activities performed which do Non-Value Added: Activities performed which do

not not directlydirectly contribute to meeting customer contribute to meeting customer requirements.requirements.

Non-Value Added Necessary: Activities that Non-Value Added Necessary: Activities that contribute to running the business but do not directly contribute to running the business but do not directly add value to meeting customer requirements. (e.g., add value to meeting customer requirements. (e.g., legal, regulatory, etc.)legal, regulatory, etc.)


Process FlowProcess FlowReceive Account

Payable Documents

Check Document Completeness and

Accuracy

Correct?

Sign and Attach supporting documents

Sent to Accounting Audit Group

Correct?

Return to Sender for correction

Return to Account Payable

Department

Send to Controller for final approval

no

yes

yes

noRevise and Re-

submit to Accounting

Waste


Workflow Diagram - (Spaghetti Diagram)Workflow Diagram - (Spaghetti Diagram)

BLDG A

Warehouse

Walking the process


ANALYSE PHASEANALYSE PHASE

Use the Information (data + context) to Create Use the Information (data + context) to Create Knowledge (Information + Expertise)Knowledge (Information + Expertise)

Draw some conclusionsDraw some conclusions

Objectives:Objectives: Find the root causeFind the root cause Propose “options”Propose “options”


ANALYSE PHASEANALYSE PHASE

SIMPLE CHARTSSIMPLE CHARTS ParetoPareto Time LineTime Line

Result

0

0.2

0.4

0.6

0.8

Routing Incomplete Correct

Events

0

1

2

3

4

5

6

7

8

1 2 3 4 5 6 7 8 9 10

Day

Sco

re


Practical ExamplePractical Example

Service: Columbus Metropolitan LibrariesService: Columbus Metropolitan Libraries The issue: The Main Library is not a DestinationThe issue: The Main Library is not a Destination

Looking at Data with a different approachLooking at Data with a different approach Data + Context = InformationData + Context = Information Information + Expertise = KnowledgeInformation + Expertise = Knowledge


Looking at DataLooking at Data

Branch 1992 1997 2002Driving Park 110,208 130,051 172,136Dublin 332,185 350,288 455,050Franklinton 137,055 109,534 188,108Gahanna 362,283 329,522 444,143Hilliard 276,448 441,254 585,100Hilltop 228,796 366,829 425,796Karl Road 545,315 561,779 585,620Linden 92,633 103,828 168,207Livingston 240,409 245,324 260,211Main 1,383,892 1,349,858 1,273,872ML King 77,660 111,100 177,640Northern Lights 294,423 234,959 318,516Northside 168,106 224,415 263,335Parsons 153,395 139,994 191,275Reynoldsburg 475,115 599,070 611,966Shepard 87,284 94,314 101,582Southeast 243,099 276,827 422,545South High 215,097 207,348 246,032Whetstone 674,698 361,255 642,386Whitehall 146,385 198,968 254,106System Total 6,398,226 6,436,517 7,842,375

Branch 1992 1997 2002Northwest 289,767 472,487Hilliard 464,329 984,105 1,411,460Hilltop 354,577 631,183 768,138ML King 57,783 93,944 173,317Shepard 75,697 122,406 160,404Driving Park 80,869 110,210 134,627Whitehall 202,822 271,450 381,309Gahanna 575,373 743,088 1,253,547Southeast 380,945 485,213 855,966Main 2,061,699 2,550,076 2,525,616Karl Road 860,947 1,018,052 1,191,076Reynoldsburg 944,618 1,101,058 1,356,912Northern Lights 271,587 314,525 404,230Linden 97,587 112,340 157,376South High 252,731 288,866 354,469Dublin 781,221 830,280 1,229,613Franklinton 152,204 161,617 167,589Northside 183,271 193,643 352,507Whetstone 983,783 927,708 1,185,493Livingston 308,283 287,742 313,576Parsons 193,396 175,636 208,006System Total 9,642,350 11,811,189 15,323,558

MEASURE


Data AnalysisData Analysis

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

60%G

ah

an

na

So

uth

ea

st

No

rth

sid

e

Du

blin

Hill

iard

ML

Kin

g

Sh

ep

ard

Wh

ets

ton

e

Wh

iteh

all

Re

yno

ldsb

urg

So

uth

Hig

h

Lin

de

n

Hill

top

No

rth

ern

Lig

hts

Ka

rl R

oa

d

Ma

in

Pa

rso

ns

Liv

ing

sto

n

Dri

vin

g P

ark

Fra

nkl

into

n

% Change Book Circulation 1997-2002

MEASURE


NW NE

SW SE

Columbus Metropolitan Library

Geographical Distribution

No. Location Library Name1 SE Driving Park2 NW Dublin3 SW Franklinton4 NE Gahanna5 NW Hilliard6 SW Hilltop7 NE Karl Road8 NE Linden9 SE Livingston

10 MAIN Main Library11 NE Martin Luther King13 NE Northern Lights14 NW Northside16 SE Parsons17 SE Reynoldsburg18 NE Shepard19 SE Southeast20 SE South High21 NW Whetstone22 NE Whitehall


Data Analysis: AnovaData Analysis: Anova

NW NE MAIN SW SE

20

30

40

50

60

70

80

Location

% C

hang

ePercent Change 1997 - 2002A

NALYSE


THE TOUGH TOOLSTHE TOUGH TOOLS

Statistical Data AnalysisStatistical Data Analysis Variable DataVariable Data

• Hypothesis TestingHypothesis Testing• RegressionRegression• Weibull & Reliability AnalysisWeibull & Reliability Analysis

Attribute DataAttribute Data• Chi-SquareChi-Square

Capability AnalysisCapability Analysis ChartsCharts


2520151050-5

USLLSL

Process Capability Analysis for C1

PPM Total

PPM > USL

PPM < LSL

PPM Total

PPM > USL

PPM < LSL

PPM Total

PPM > USL

PPM < LSL

Ppk

PPL

PPU

Pp

Cpm

Cpk

CPL

CPU

Cp

StDev (Overall)

StDev (Within)

Sample N

Mean

LSL

Target

USL

687520.13

554607.20

132912.93

673422.73

559030.23

114392.51

900000.00

750000.00

150000.00

-0.05

0.37

-0.05

0.16

*

-0.05

0.40

-0.05

0.18

5.12602

4.73941

20

10.7039

5.0000

*

10.0000

Exp. "Overall" PerformanceExp. "Within" PerformanceObserved PerformanceOverall Capability

Potential (Within) Capability

Process Data

Within

Overall


A Six Sigma Process Aims at Zero DefectA Six Sigma Process Aims at Zero Defect


IMPROVEMENT / DESIGNIMPROVEMENT / DESIGN

IMPROVEMENT:IMPROVEMENT: The process can be fixedThe process can be fixed Viable options exitsViable options exits

DESIGN:DESIGN: The process is brokenThe process is broken Old process cannot be more robustOld process cannot be more robust No valid optionsNo valid options

Goal: Implement Robust Solutions or DesignGoal: Implement Robust Solutions or Design


CONTROL / VALIDATECONTROL / VALIDATE

CHALLENGES:CHALLENGES: Foresee the impact of the changesForesee the impact of the changes Communication planCommunication plan Validate resultsValidate results Achieve planned goalsAchieve planned goals

Goals: Goals: A Stable ProcessA Stable Process

A Fix That WorksA Fix That Works

Improvements can be sustainedImprovements can be sustained


Using the Tools Is Not LinearUsing the Tools Is Not Linear

D M A I C

START Loop back regularly to enhance your

learning about the process.

04/10/2304/10/23 © Copyright Jean-Marie Cote© Copyright Jean-Marie Cote

The way we do business.....

Six Sigma

Strategic Tool

Jean-Marie Cote MBB


SuccessSuccess

What is your Mission?What is your Mission? What is your Vision?What is your Vision? Are you generating:Are you generating:

DataData Information Information KnowledgeKnowledge

Data + Context = Information

Information + Expertise = Knowledge

THE PROCESS OF CREATING KNOWLEDGE


Six Sigma SuccessSix Sigma Success

Actions are in Line with the StrategyActions are in Line with the Strategy Meet or Exceed Customer ExpectationsMeet or Exceed Customer Expectations Meet Management ExpectationsMeet Management Expectations Adding Value to the ProcessesAdding Value to the Processes Doing the Right ThingDoing the Right Thing A Clear and Well Defined StrategyA Clear and Well Defined Strategy


StrategyStrategy Strategy as a BridgeStrategy as a Bridge: (1): (1)

Values are the bedrock on which the piers of the Values are the bedrock on which the piers of the bridge are planted.bridge are planted.

The near bank is today’s reality – your baseline.The near bank is today’s reality – your baseline. The far bank is the visionThe far bank is the vision Your strategy is the bridge itselfYour strategy is the bridge itself

(1) Source:The Bottom Line, Joseph R. Matthews, 2002 Librairies Unlimited


Why Six Sigma Deployment Fails?Why Six Sigma Deployment Fails?The 7 Deadly Sins The 7 Deadly Sins (1)(1)

The 7 Deadly Sins:The 7 Deadly Sins:1.1. Inadequate InformationInadequate Information2.2. Poor Project SelectionPoor Project Selection3.3. Creating Solution-Caused ProblemsCreating Solution-Caused Problems4.4. Serving the Wrong CustomerServing the Wrong Customer5.5. Leaping to the FixLeaping to the Fix6.6. Faulty ImplementationFaulty Implementation7.7. Failing to Consider the Human SideFailing to Consider the Human Side

While they can be deadly, redemption is possible.While they can be deadly, redemption is possible.

(1) Source: J. Zimmerman and Dr J. Weiss, Quality Magazine Jan 05.


In Other WordsIn Other Words

““If you want to start doing something new, If you want to start doing something new, you need to stop doing something old” – you need to stop doing something old” – Peter DruckerPeter Drucker..

Insanity: “Doing the same thing over and Insanity: “Doing the same thing over and over and hoping for a change”over and hoping for a change”


SOME FOOD FOR THOUGHT...SOME FOOD FOR THOUGHT...

SIX SIGMA TRAINING IS NOT THE END, IT IS JUST THE END OF THE BEGINNING

SIX SIGMA MENTORING IS ABOUT ASKING QUESTIONS, NOT GIVING ANSWER

THE BEST TEACHER IS THE ONE WHO TEACH YOU HOW TO THINK

……WORDS OF WISDOMWORDS OF WISDOM



Prepared and Presented by:

Jean-Marie Cote Six Sigma MBB

Work contact:

Phone: 740-774-5151

email: [email protected]

Personal contact:

Home phone: 614-801-2367

email: [email protected]

Six Sigma in the Service Sector

Special Libraries Association (SLA)

Annual Conference, Toronto, June 2005

© Copyright Jean-Marie Cote SIX SIGMA

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