01 LSS Introduction

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Lean Six Sigma Operational - Delegate Workbook

SSG06301ENUK - Intro /Issue 1.3/September 2008 1 The British Standards Institution 2008

Lean Six Sigma Introduction

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SSG06301ENUK Delegate Slides/Issue 1.3/ S eptember 2008

History of Six Sigma

Established by Motorola in the 1980s and still

being developed. Seen as a cornerstone to the

companys culture

Companies adopting 6 Sigma include GeneralElectric, Allied Signal, ABB, BT, Sony, RBS,

Lockheed Martin, Ford, Nissan and many others

It is essential for companies to take responsibility

for their own (unique) programme


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What is Six Sigma?

A systematic approach to process

improvement

Processes can be related to design,

manufacturing or administrative functions

It involves the use of statistical tools and

techniques to analyse & improve processes

The relentless pursuit of variability reduction

and defect elimination

LSL USL

LSL USL

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Where can Six Sigma be applied?

Six Sigma can be applied to all company

processes

A distinction is often made between:

Design applications (Design for Six Sigma)

Manufacturing applications (Operational Six Sigma)

Administrative and Service applications (Transactional

Six Sigma)


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The Six Sigma Metric

Used in statistics as a measure of variation

Sigma=

Standard Deviation

The central philosophy of 6 Sigma is the reductionof variation in all our work processes

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The Normal Distribution

The 3 Sigma mentality means 2700 defectives per million!

Lowerspeclimit

Upperspeclimit

-1 +1

y 1 = 68.26%

+2-2

y 2 = 95.44%

-3 +3

y 3 = 99.73%

y

(Target)


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The 6 Sigma Metric

-6 -5 -4 -3 -2 -1 y +1 +2 +3 +4 +5 +6

Lower

specification

limit

Upper

specification

limit

Normal Distribution

Centred on Target

6 99.999999999 0.002

5 99.99994 0.6

4 99.9937 63

Specification

Limit

Percent within Specification

(Centred Distribution)

Defects per Million

(Centred Distribution)

3 99.73 2700

-6 -5 -4 -3 -2 -1 y +1 +2 +3 +4 +5 +6-6 -5 -4 -3 -2 -1 y +1 +2 +3 +4 +5 +6

6 99.999999999 0.0026 99.999999999 0.002

5 99.99994 0.65 99.99994 0.6

4 99.9937 634 99.9937 633 99.73 27003 99.73 2700

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From 3 Sigma to 6 Sigma

Lowerspeclimit

Upperspeclimit

2700

Defects per Million

Lowerspeclimit

Upperspeclimit 0.002


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1.5 Shift

Lowerspeclimit

Upperspeclimit

-6 -5 -4 -3 -2 -1 y +1 +2 +3 +4 +5 +6

Motorolas 6 Sigma Metric

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7

Sigma Level

1,000,000

100,000

10,000

1,000

100

10

1

PPM

Restaurant Bills

Payroll Processing

Prescription Writing

Baggage Handling

AirlineSafety Rate

3 4 5 621

Best inClass

Tax Advice

What does 6 Sigma mean in yourdaily life?


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History of Lean

Lean originates from the work of Taiichi Ohno who was looking tocreate effective production processes at Toyota after the SecondWorld War

The fundamental principle is the elimination of all forms of waste(or MUDA)

Initially adopted by other Japanese companies it took some time toreach the West and is known by various names (eg ToyotaProduction System (TPS), Just-In-Time (JIT), etc)

Leans systematic focus on the removal of waste is now being

applied across many industrial sectors and is used by many of theorganisations using Six Sigma

Waste is worse than theft!Waste is worse than theft! Taiichi Ohno, ToyotaTaiichi Ohno, Toyota

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What is Lean? The five principles

Always define Valuefrom the customers perspective

Identify the Value Stream (and component activities)

needed to take a product (or service) from customer request

to completed delivery

Ensure product or service activity Flowsthrough the value

stream without any delays

Use Pullscheduling so that product is made or a service is

provided only when the customer wants it

Strive continuously to eliminate all forms of Wastefrom the

processes involved


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The Hidden Office/Factory When a defect is produced (eg incorrect quote, unordered package

delivered, wrong meal served) time, energy, raw material, and the

companys capacity to undertake value adding work is reduced

This all takes time, people, material, energy, and floor space....

Defects can cause the requirement to audit and inspect as well as

creating the need for excess motion and/or transport

Rework needs to be re-checked usually or we may need to start again

and scrap the first attempt

Often this non-value added activity is not shown within business

metrics in operations its called the hidden factory, in transactional

environments the hidden office

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Lean and the 7 Deadly Wastes

Interoffice mail, document movementTransportation

Walking to shared resources eg printers, copiersMotion

Unnecessary approval routes for documents (false

customers), duplicated process steps in different departmentsOver-Processing

Excessive copies, standard cc lists, hard copies of electronic

documentsOverproduction

Delaying a decision until a colleague returns from a business

trip

Waiting

Wrong prices, wrong codes, missing informationDefects

Full in-trays, long to-do lists, queues of orders waiting to be

processedInventory


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Lean Sigma Optimisation: the Link

Customer Focus- Defect Reduction- Business Growth

Business Infrastructure- Green Belts- Black Belts- Sponsors

Statistical Thinking- Prove with Data

- Metrics- Variation Reduction

Speed

Flow

Removal of Waste- Excess Inventory- Wasted Timeand Motion

Reducing Complexity

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Process Yield

RawMaterials

Mixing Forming CoolingFinishedProduct

FinalInspection

100% Pass

0% FailThis process has 100%

yield. Our customers wouldbe very pleased. Should webe just as happy?


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Detailed examination reveals thatwe have rework or repair at eachstage of the process.

Rolled Throughput Yield

RawMaterials


FinalInspection

100% Pass

0% Fail

Rework& Repair

Rework& Repair

Rework& Repair

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RTY = 0.925 x 0.94 x 0.95 = 0.826 = 82.6%

0% Fail

7.5% of Units

6% of Units

5% of Units

RawMaterials


FinalInspection

100% Pass

0% Fail

Rework& Repair

Rework& RepairRework& Repair

Rolled Throughput Yield


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COPQ in Six Sigma Projects

Estimate the potential savings the project could yield (Define/Measure Phase).

Quantify the actual savings once improvements have been made

(Improve/Control Phase).

Six sigma

project/savingsCostofpoorquality

Chronic waste

Time

Sporadic spike, historicalfocus of management

attention

Six sigma

project/savingsCostofpoorquality

Chronic waste

Time

Sporadic spike, historicalfocus of management

attention

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Which Process to Follow?

Problem Solving used when we were OK, now

have a problem, and wish to return to the previous

state (will not improve the process)

Operational DMAIC used when we intend toimprove any process which works on physical

transformations of materials into products

Transactional DMAIC used when we intend to

improve any process which transforms data and

information into the required outputs


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Summary

An initiative that extends and strengthens quality

and productivity efforts

A proven breakthrough contributor to the financial

bottom line

A detailed roadmap to process improvement

A methodology that our people can and should be

using to do their jobs

01 LSS Introduction

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Transcript of 01 LSS Introduction