LEAN SIX SIGMA TAGUCHI METHODS Manufacturing Planning Process
LEAN SIX SIGMATAGUCHI METHODS
Manufacturing Planning Process
“Quality begins with me.” Phil Crosby
Lean Six Sigma (LSS)
Improvement MethodsDesign for LSS (DFSS)LSS Implementation IssuesStrategic LSS RoadmapThe Malcolm Baldrige Award
Six Sigma Improvement Methods
No need to choose between improvement and replacement - Six Sigma accommodates both!
Define
Measure
Analyze
Design
Validate
Improve
Control
“He who stops being better stops being good.” Oliver Cromwell
LSS Tollgates/DMAIC Checklist
Review progress after each DMAIC phase
Approve transition to the next phase
to insure that the team does not rehash, regress, or fail for other reasons
Tollgate Purpose:
Responsibility: Quality Council (Steering Team)
Define Tollgate Checklist
Relevant Background InformationProblem Statement/Clear Business CaseVoice of CustomerProcess Description - SIPOC Project Charter
Project Benefits Resources Needed Source of Baseline Data
High Level Flowchart DMADV/DFSS?
Business Case
Cu
sto
me
r
Re
qu
ire
me
nt
Technical Requirem ent
Process Name
Product/ Service Description
Objective
Project Scope Statement
Assumptions/ Constraints/ Risk
Benefits
Schedule
Project NameBusiness Unit DepartmentStart DateProject Budget
Contact Information
Project Stakeholder Phone number E-mailNameProject Champion Process OwnerBlack/ Green Belt Team Members
Project Y Baseline Forecast Objective
Process Name
Product/ Service Description
Objective
Project Scope Statement
Assumptions/ Constraints/ Risk
Benefits
Schedule
Project NameBusiness Unit DepartmentStart DateProject Budget
Contact Information
Project Stakeholder Phone number E-mailNameProject Champion Process OwnerBlack/ Green Belt Team Members
Project Y Baseline Forecast Objective
MISSIONPurposeVisionValues
STRATEGYGOALS AND
OBJECTIVES
PROJECTS
MISSIONPurposeVisionValues
STRATEGYGOALS AND
OBJECTIVES
PROJECTS
S h i p p in gS o u r c i n g P a c k a g in g C u s t o m e r S e r v i c eI n p u t s O u t p u t s
E n v i r o n m e n t a l A n a l y s is
D e v e lo p R F PC o n d u c t B i d
P r o c e s s
I m p le m e n t S u p p l i e r C h a n g e
S e le c t S u p p l ie r
S h i p p in gS o u r c i n g P a c k a g in g C u s t o m e r S e r v i c eI n p u t s O u t p u t s
E n v i r o n m e n t a l A n a l y s is
D e v e lo p R F PC o n d u c t B i d
P r o c e s s
I m p le m e n t S u p p l i e r C h a n g e
S e le c t S u p p l ie r
Alignment Charter
High Level Process Map
Voice ofCustomers
S
Suppliers
I
Input
P
Process
O
Outputs
C
Customers
Input Boundary Output Boundary
Requirements Requirements
S
Suppliers
S
Suppliers
I
Input
I
Input
P
Process
P
Process
O
Outputs
O
Outputs
C
Customers
C
Customers
Input Boundary Output Boundary
Requirements Requirements
SIPOC
Measure Tollgate Checklist
Scheduled Team MeetingsIdentify Measures to Collect and Analyze dataCollect Baseline DataControl Charts for Y’sMSAInitial Cpk
RTYUpdate Charter
Types of Measures/Setting TargetsFinancial
Customer
Internal Process
Financial
Customer
Internal Process
Learning & Growth
Data Collection and PrioritizationBilling Errors
Wrong Account
Wrong Amount
A/R ErrorsWrong Account
Wrong Amount
Monday
Billing ErrorsWrong Account
Wrong Amount
A/R ErrorsWrong Account
Wrong Amount
Monday
Measurement Systems Analysis
Statistical Process Control vs. Inspection
Control Charts
Process Capability
Cause & Effect Matrix
1 02 03 04 05 06 07 08 09 0
0 0 0 0 0 0 0 0
Y 6
Y 8
Y 1
Y 2
Y 3
Y 4
Y 5
Total
To
tal
Process Step
Y 7
KPIV
KPOV
Cause & Effect Matrix
1 02 03 04 05 06 07 08 09 0
0 0 0 0 0 0 0 0
Y 6
Y 8
Y 1
Y 2
Y 3
Y 4
Y 5
Total
To
tal
Process Step
Y 7
Cause & Effect Matrix
1 02 03 04 05 06 07 08 09 0
0 0 0 0 0 0 0 0
Y 6
Y 8
Y 1
Y 2
Y 3
Y 4
Y 5
Total
To
tal
Process Step
Y 7
KPIV
KPOV
222gageproductobseerved
A B C D
Defects
A B C D
Defects
Take Sample
Receive Lot
MeetCriteria?
Accept
RejectRework/Waste
Send to Customer
Take Sample
Receive Lot
MeetCriteria?
Accept
RejectRework/Waste
Send to Customer
Understanding Variation
Time
Time
YieldRTY
YieldRTY
Analyze Tollgate Checklist
Detailed Process MapProcess AnalysisCollect Baseline Data on X’sRoot Cause AnalysisControl Charts for X’sAnalyze X’s vs. Y’sFMEA Benchmarking
Benchmarking/Appreciative InquiryPhase 6: International Benchmarking
Phase 5: Strategic Benchmarking
Phase 4: Different Industry Process Benchmarking
Phase 3: Similar Industry Process Benchmarking
Phase 2: Reverse Engineering
Phase 1:Internal Benchmarking4-D
Cycle
Discovery
Dream
Design
Des
tin
y 4-DCycle
Discovery
Dream
Design
Des
tin
y
Process Analysis and Little’s LawEnter Bank
Acceptable Queue?
Deposit ticket ready?
Prepare deposit ticket
Go directly to teller
line
Teller Queue
STAR T
EXIT
no
ye s
ATM
Teller
no
yes
Deposit envelop ready?
Prepare deposit
envelope
Go directly to ATM
line
ATM Queue
no
yes
ye s
y esn o
RateThroughput
WIP AverageTimeLead
Process Analysis and Little’s LawEnter Bank
Acceptable Queue?
Deposit ticket ready?
Prepare deposit ticket
Go directly to teller
line
Teller Queue
STAR T
EXIT
no
ye s
ATM
Teller
no
yes
Deposit envelop ready?
Prepare deposit
envelope
Go directly to ATM
line
ATM Queue
no
yes
ye s
y esn o
RateThroughput
WIP AverageTimeLead
Capacity Planning and Line BalancingStage 1 Stage 2 Stage 3
6,000 7,000 5,000Units per month
Stage 1 Stage 2 Stage 3
6,000 7,000 5,000Units per month
timeCycle * stations of#
s task timeofSum =nUtilizatio
Process/Product Failure Modes and Effects Analysis
Process Step Failure Mode Failure Effects Causes Controls use max SEV Action Resp Timing
May be process step, general activity, functional area, or
other rational grouping
What is the potential failure or undesirable
outcome for this area?
If the failure mode occurs, what will the effect be?
SEV
What is/are the cause/s of the failure?
OCC
What controls are in place to prevent the cause from occuring or to detect that the cause has
occurred?
DET
RPN
What specific actions are required to improve the RPN
number
Who will be accountable for implementing the change
When is completion of the action required or
planned
0 0
0 0
0 0
0 0
0 0
0 0
PSEV
POCC
PDET
PRPN
Failure Mode and Effects Analysis Process/Product Failure Modes and Effects Analysis
Process Step Failure Mode Failure Effects Causes Controls use max SEV Action Resp Timing
May be process step, general activity, functional area, or
other rational grouping
What is the potential failure or undesirable
outcome for this area?
If the failure mode occurs, what will the effect be?
SEV
What is/are the cause/s of the failure?
OCC
What controls are in place to prevent the cause from occuring or to detect that the cause has
occurred?
DET
RPN
What specific actions are required to improve the RPN
number
Who will be accountable for implementing the change
When is completion of the action required or
planned
0 0
0 0
0 0
0 0
0 0
0 0
PSEV
POCC
PDET
PRPN
Failure Mode and Effects Analysis
Other Lean ToolsPrevious Sub-Process or Supplier
Next Sub-Process
A
B
D
emand Customer D
TimeWork AvailableTimeTakt
Other Lean ToolsPrevious Sub-Process or Supplier
Next Sub-Process
A
B
D
emand Customer D
TimeWork AvailableTimeTakt
Statistical Roadmap for Analyze
CONTINOUS DATA DISCRETE DATA
DMAIC
ANALYZE
VALIDATE ROOT CAUSES
HYPOTHESIS TESTS
DMAIC
ANALYZE
VALIDATE ROOT CAUSES
HYPOTHESIS TESTS
1+1=2
Qualitative vs. Quantitative Tools
?? 1+1=2
Qualitative vs. Quantitative Tools
??
Improve Tollgate Checklist
Create Future State/Pilot Solution Optimize SolutionDevelop Implementation PlanImprovement SignificanceObtain Approvals Implement ImprovementsMistake ProofService Recovery
Kaizen Events
Develop and Simulate Future State
Optimize Solutions Mistake-Proof New Process/Risk Management
Service RecoverySupplier
I110 units
RECEIVE PRECUT PRE SPICE
Service
Customer
I92 units
I130 units
FINAL ASSEMBLYI
125 units
Supplier
I110 units
RECEIVERECEIVE PRECUTPRECUT PRE SPICEPRE SPICE
ServiceService
Customer
I92 units
I130 units
FINAL ASSEMBLYFINAL ASSEMBLYI
125 units
Develop Future State Implementation PlanCurrent State Value Stream Map
3 min5 min6 min
Supplier
I110 units
RECEIVERECEIVE PRECUTPRECUT PRE SPICEPRE SPICE
ServiceService
Customer
MondayMonday
I92 units
I130 units
CT = 6 min
FPY=92%
CT=5 min
FPY=90%
CT=3 min
FPY= 94%
FINAL ASSEMBLYFINAL ASSEMBLYI
125 units
CT=5 min
FPY= 95%
138 min 143 min 101 min
Lead Time = 503 min
Process Time = 19 min
5 min
Throughput Time = 522 min
3.6% cy EfficienProcess
036.0522
19
Time Throughput Total
Time ProcessTotal cy EfficienProcess
Future State Value Stream Map
3 min6 min
RECEIVERECEIVE PRE SPICEPRE SPICE
ServiceServiceCustomer
I46 units
I130 units
CT = 6 min
FPY=92%
CT=3 min
FPY= 94%
FINAL ASSEMBLYFINAL ASSEMBLY
CT=5 min
FPY= 95%
121 min 143 min 50 min
110 units
Supplier
I
MondayMonday
Lead Time = 314 min
Process Time = 14 min
5 min Throughput Time = 328 min
4.2% cy EfficienProcess
042.0328
14
Time Throughput Total
Time ProcessTotal cy EfficienProcess
A c t iv i t y
Id e n t i f y S a l e w i t h 8 0 % P r o b a b i l i t y A
Id e n t i f y A v a i la b le T r u c k s B
C o n t r a c t f o r A d d i t io n a l T r u c k s C
C lo s e t h e S a le D
D e v e l o p P r o m o t io n a l M a t e r i a ls E
Im p le m e n t p r o m o t io n F
D e b r i e f L e a n i n g s / W r i t e F in a l R e p o r t G
1 2 3 4 5 6 7 8 9 1 0 1 1 1 2W e e k
A c t iv i t y
Id e n t i f y S a l e w i t h 8 0 % P r o b a b i l i t y A
Id e n t i f y A v a i la b le T r u c k s B
C o n t r a c t f o r A d d i t io n a l T r u c k s C
C lo s e t h e S a le D
D e v e l o p P r o m o t io n a l M a t e r i a ls E
Im p le m e n t p r o m o t io n F
D e b r i e f L e a n i n g s / W r i t e F in a l R e p o r t G
1 2 3 4 5 6 7 8 9 1 0 1 1 1 2W e e k
Describe Defect and Defect rate
Determine Defect Location
Study the Process Flow
Observe the Process
Identify errors and determine cause
Determine prevention method
Test/re-test in extreme conditions
P ro cess Identification
Inc idents
R em edies
C o st o f Inc id en t
M easu rem ent o f Freq uency
C usto m erIdentifica tion
M iss ionS tatem en t
Cost ofPoor Quality
Control Tollgate Checklist
Standardize WorkAssure Change ManagementGuarantee Process CapabilityObtain Management Sign-offImplement ControlsInsure Gains Monitor ProcessAssign Process OwnerImplement a Periodic Review
Change Management
Monitor Process
Response Plan
Financial Benefit
Closure
CURRENT STATE
TRANSITION STATE
FUTURE STATE
CURRENT STATE
TRANSITION STATE
FUTURE STATE
F in a n c ia l B e n e fit
-1 5
-1 0
-5
0
5
1 0
1 5
2 0
2 5
3 0
3 5
1 3 5 7 9 1 1 1 3 1 5 1 7 1 9 2 1 2 3 2 5 2 7 2 9 3 1 3 3 3 5
Th
ou
sa
nd
s
M o n th s
H i g h E sti m a te
L o w E sti m a te
No
Yes
Yes
No
Yes
No
Yes
No
Yes
No
Yes
18Receive TravelRequirements
19QC trip
1Travel Need
10Select Travel
Planner
44Send Email of
Itinerary
20Book Airfare
8Call Travel #
40Problem
Acknowledgedwith Traveler
26Select and
Confirm Hotel
a
Problem w/ Itinerary?
22View Preferred
Hotels
FlightRequired?
2Use On-line
tool
14Lowest Airfare
Selected?
15Enter
ReasonCode
41Problem
resolved within72 hrs?
29Select Hertz or
National
32Submit and
ConfirmItinerary
a
42Client Notified
ProblemResolved
A
b
b
KPOV KPIV LSL Target USL
Measurement Method
Sample SizeWho
Checks Data
ProcessSub
Process Step
VariableSpecification/ Requirement
FrequencyWhere is
DataDecision Rule/
Corrective Action
Process Capability
Standardization
Design for Lean Six Sigma (DFLSS)
A design process for re-engineering opportunities (DMADV) Objective is to design a new process with Six Sigma
quality to start Focus is on “front-loading the pain”
Must be identified by management as major opportunities for savings and/or customer satisfaction
Projects will be longer; team members may need to be back-filled in their jobs for the duration of the project
Design for Lean Six Sigma (Continued)
DFLSS Dimensions: Design for Manufacture and Assembly Design for Reliability Design for Maintainability Design for Serviceability Design for Environmentality Design for Life-Cycle Cost
Benefits Include: Reduced Life-Cycle Cost Improved Quality Increased Efficiency and Productivity
“When organizations are considering making a change, they will consider associated costs, but will not give adequate consideration to the cost of not making the change.”
Source: F. Breyfogle, Implementing Six Sigma, 2003
Tools
QFD, Benchmarking, FMEA, Simulation,
Optimization, Life-Cycle Planning, DOE, Taguchi Loss Functions, and Triz
DFLSS Tools: Taguchi
Taguchi Methods are statistical methods developed largely by GENICHI TAGUCHI to improve quality of manufactured goods.
The philosophy of off-line quality control.
Innovations in the design of experiments.
Taguchi Loss Function
Taguchi defines Quality as “the loss imparted by the product to society from the time the product is shipped.”
LOSS = Cost to operate, Failure to function, maintenance and repair cost, customer satisfaction, poor design.
Product to be produced “being within specification”
Taguchi’s Vs. Traditional Approachs
Taguchi’s Traditional
When a product moves from its Target the loss is there even if the product lies within Limits
There are Good or Bad Products only as per Limits
Taguchi’s Quadratic Quality Loss Function
Quality Loss Occurs when a product’s deviates from target or nominal value.
Deviation Grows, then the Loss increases.Taguchi’s U-shaped loss Function Curve.
Taguchi’s U-shaped loss Function Curve.
UTL
Scrap or Rework Cost.
LTL Nominal
Measuredcharacteristic
Taguchi loss Fn
Loss
Formula to find Taguchi’s Loss Fn
L (x) = k (x-N)² Where L (x) = Loss Function, k = C/d² = Constant of proportionality d - Deviation of specification
from target value x = Quality Features of selected product, N = Nominal Value of the product and (x-N) = Tolerance
Taguchi: Loss Curve
Loss Loss
LSL USL
No Loss
T
Loss (L)
x
DFLSS Tools: Life Cycle Planning
The probability of a new product or service failure is highest in the early stages due to design or production flaws, and decreases and then levels out with usage e.g., initial problems with new cars or homes
However, at some point, the probability of failure increases as parts wear out
Some systems are repairable or replaceable, while others are not.DFLSS planning must
consider these factors
“Bathtub” Curve
Usage (time)
Failure Rate
DFLSS Tools: Simulation
A method for replicating real world relationships using a few factors, simply related
Typically done with the aid of a computerUtilizes historical data or other knowledge to
make assumptions about the likelihood of future events
Allows for the study of variation in processesEnables analysis and learning without
disrupting the real system under investigation by using random numbers to “simulate” events
Not an optimization technique; decision variables are inputs to a simulation
DFLSS Tools: Design of Experiments
DOE is a statistical procedure for conducting a controlled experiment, where the impact of high versus low settings of X’s are determined, including possible interactions
“Blocking” and other aspects of DOE help to reduce the needed number of trials, and remove the effect of noise factors
DOE can also be used to test the prediction quality of a DSS model
Catapult Experiment
This compares to “OFAT” experiments, which take too long and cannot detect interactions!
DFLSS Tools: Optimization
Objective is to find the settings for the “vital few” controllable inputs (X’s) to optimize desired results (Y’s)
Note that optimization of parts of systems can lead to sub-optimization of the whole system (e.g., Sales over-committing Operations to customers, reduced quality due to purchasing cheaper items)
Simple spreadsheet tools (such as Solver in Excel) can be used to determine the best levels of input factors to optimize a system (maximize profit, minimize costs, etc.)
Response Surface Methodology (RSM) is a sequential statistical procedure (supported by
Minitab) that combines optimization techniques and DOE
DFLSS Tools: Theory of Inventive Problem Solving (TRIZ)
A combination of methods, tools, and a way of thinking developed in the Soviet Union in the 1940s
Used for concept generation and problem-solving Assumes that all inventions contain at least one
contradiction e.g., faster auto acceleration reduces fuel efficiency,
productivity vs. accuracy, etc. Success depends on resolution of contradiction Involves trade-off between contradictory factors,
or overcoming the contradiction Despite the immensity of problems, only 1250 typical
system contradictions in 39 design parameters have been found to date
Many Triz tools have been developed to deal with these contradictions Source: Design for Six Sigma, Yang and El-Haik,
2003
Lean and Single Supplier Strategy
Time saved dealing with many suppliers Larger batch sizes possible (more stable process) Fewer changeovers; less idle time Captive assembly lines possible; easy to schedule
priorities Supplier can demand higher quality from its
suppliers due to larger quantities More time for corrective action Reduction in price due to quantity given to single
supplier Reduction in incoming quality rejections Reduction in variability
Advantages
Lean and Single Supplier Strategy
Easier to share responsibilities for quality; more commitment; better communications
Greater moral responsibility for quality from supplier More volume available if industry shortages of materials Simpler and faster training Improved document and sample control (less specs, more up-
to-date) Minimized identification issues when field failures One stop corrective actions Reduced cost of quality (less travel, telephone costs,
executive time) More time to communicate with customers Priority access to supplier’s R&D breakthroughs
Lean and Single Supplier Strategy
Fewer brainstorming opportunities and competitive benchmarking opportunities (but can offset with industry research, benchmarking, FMEA analysis, leveraging best ideas of single supplier, etc.)
Dependence on one supplier to get it right (but can use SPC for early warnings of process deviations)
Emergency breakdown at single supplier facility (can be offset with contingency planning, dormant supplier preparedness, and long-term ordering)
Potential loss of diversity of suppliers
Disadvantages
Other Lean Considerations
Many organizational decisions negatively impact continuous flow
Lean continuous flow is not always appropriate Innovative products Need responsiveness and flexibility
Multiple supplier relationships cannot support Lean Single supplier strategy is needed, even for critical resources Need to partner with a supplier to achieve your Lean goals!
Lean is a prerequisite to outsourcing
Ord
er
Qu
an
tit y
TimeWholesaler’s OrdersRetail Orders
Manufacturer’s Orders
Bullwhip Effect
LSS Implementation Issues
Change Management Resistance to change Lack of appropriate data Threat of job security Rewards and recognition Training
LSS LengthLSS Buy-in
Leadership Individuals and teams
Measurement of LSS SuccessLSS buy-in: the LSS steering team vs. the management team
LSS Training Roll-Down
Start with Executive Management/Champions Orientation to Lean Six Sigma
DMAIC methodology Key tools Management responsibilities
Complete initial LSS plan after this training Initiate 1-2 LSS projects to begin to “walk the talk”
Develop/Purchase Training Materials MBB/BB Training and Learning
Develop the infrastructure for LSS training Middle Management/Process Owners Green Belts/Other Belts Remaining Organization Orientation
Strategic LSS Roadmap
Measure
Control
Analyze
Improve
Define
Strategic PlanSystems Alignment Benchmarking
Business Objectives
Financials
Internal Process
Learning/Innovation
UCL
LCL
Gap
Customer
Create VisionIdentify VOCEstablish Metrics
Business Leadership
Business Measures
Select ProjectsManage Tollgates
Company Balanced Scorecard
LCL
UCL
Process Measures
Y'sX's
Pro
cess D
ash
board
Process Flow
VSMSupplier
ServiceServiceCustomer
6 Lean
Gap
Gap
Baldrige Award Criteria Framework
A Systems Framework for Performance Excellence
Leadership
StrategicPlanning
Customer andMarket Focus
ProcessManagement
Human ResourceDevelopment
& Management
BusinessResults
Measurement, Analysis, and Knowledge Management
Organizational Profile: Environment, Relationships, and Challenges