Summary of LSS Concepts

LSSG Black Belt Training

Summary Module

“Quality begins with me.” Phil Crosby

Agenda for LSS Summary Module

DMADV/DFLSS Supplier LSS LSS Implementation Issues Strategic LSS Roadmap The Malcolm Baldrige Award Miscellaneous Topics, Based on Participant

Feedback Elevator Speech Sharing

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 Information Problem Statement/Clear Business Case Voice of Customer Process 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 i n 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 i n 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 Meetings Identify Measures to Collect and Analyze Collect Baseline Data Control Charts for Y’s MSA Initial Cpk

RTY Update 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

TotalT

ota

l

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

TotalT

ota

l

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

TotalT

ota

l

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 Map Process Analysis Collect Baseline Data on X’s Root Cause Analysis Control Charts for X’s Analyze X’s vs. Y’s FMEA 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 Solution Develop Implementation Plan Improvement Significance Obtain Approvals Implement Improvements Mistake Proof Service 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

ServiceService

Customer

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 ie f L e a n in 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 ie f L e a n in 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

Process Identification

Incidents

Rem edies

Cost of Incident

M easurem ent of Frequency

Custom erIdentification

M issionStatem ent

C ost o fPoor Q uality

Control Tollgate Checklist

Standardize Work Assure Change Management Guarantee Process Capability Obtain Management Sign-off Implement Controls Insure Gains Monitor Process Assign Process Owner Implement 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

-15

-10

-5

0

5

10

15

20

25

30

35

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35

Th

ou

sa

nd

s

M o n ths

Hig h Estim a te

L o w Estim a te

No

Yes

Yes

No

Yes

No

Yes

No

Yes

No

Yes

18Receive Travel

Requirements

19

QC trip

1

Travel Need

10

Select TravelPlanner

44Send Email of

Itinerary

20Book Airfare

8Call Travel #

40Problem

Acknowledgedwith Traveler

26Select and

Confirm Hotel

a

Problem w/ Itinerary?

22View Preferred

Hotels

Flight

Required?

2Use On-line

tool

14

Lowest AirfareSelected?

15

EnterReason

Code

41

Problemresolved within

72 hrs?29

Select Hertz orNational

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

Tools: QFD, Benchmarking, FMEA, DOE, Simulation,Optimization, Life-Cycle Planning, Taguchi Loss Functions, and Triz

Loss Loss

LSL USL

No Loss

T

Loss (L)

x

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

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 computer Utilizes historical data or other knowledge to

make assumptions about the likelihood of future events

Allows for the study of variation in processes Enables analysis and learning without

disrupting the real system under investigation by using random numbers to “simulate” events

Not an optimization technique; decision variable 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 O

rde

r Q

ua

nti

ty

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 Length LSS Buy-in

Leadership Individuals and teams

Measurement of LSS Success

LSS 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

Process

Learning/InnovationUCL

LCL

Gap

Customer

Create VisionIdentify VOC

Establish Metrics

Business Leadership

Business Measures

Select ProjectsManage Tollgates

Company Balanced Scorecard

LCL

UCL Process Measures

Y'sX's

Pro

cess Da

shb

oard

Process Flow

VSMSupplier

ServiceServiceCustomer

6 Lean

GapGap

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

LSSG Participant Expectations

LSS Elevator Speech

Each participant has been asked to create a brief but effective response to the anticipated senior management question about the value of 6 Sigma, Lean or LSS.

Your answer may be the key to LSS success in your company, and may also affect your career!

It is critical that you be prepared for this event in advance.

A summary document of these contributions will be shared with all participants

LSSG Participant Project Status Reports

5-10 minutes report-outs on current project thinking

Potential measures of project success Obstacles to completion/success Help needed Other issues

The focus of our last session on Saturday