Copyright 2011 John Wiley & Sons, Inc. Chapter 10 Lean Systems and Six-Sigma Quality 10-1.
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Transcript of Copyright 2011 John Wiley & Sons, Inc. Chapter 10 Lean Systems and Six-Sigma Quality 10-1.
Copyright 2011 John Wiley & Sons, Inc.
Chapter 10
Lean Systems and
Six-Sigma Quality
10-1
Lecture Outline
10-2
• What is Lean?
• Lean Production
• Respect for People
• Total Quality Management (TQM)
• Statistical Quality Control (SQC)
• Six-Sigma Quality
• Lean Six-Sigma Supply Chain
Copyright 2011 John Wiley & Sons, Inc.
What is Lean?
10-3Copyright 2011 John Wiley & Sons, Inc.
Lean is a management approach for creating value for the end customer through the most efficient utilization resources possible
• Standard in many industries
• Often results in:– large cost reductions– improved quality– increased customer service
Lean Six Sigma
Combines the approaches of Lean and Six Sigma
• Six Sigma– methodology to identify and eliminate causes of
quality problems
10-4Copyright 2011 John Wiley & Sons, Inc.
Tenets of Lean
There are six tenets of the Lean Philosophy:
1. Elimination of Waste– eliminate all non-value adding activities
2. A Broad View– decisions made for the success of the
entire supply chain– all supply chain members responsible for
adding value
3.Simplicity– the simpler the solution the better
10-5Copyright 2011 John Wiley & Sons, Inc.
Tenets of Lean Continued
4. Continuous Improvement– emphasis on quality and continuous
improvement– called kaizen
5. Visibility– visible problems are identified and solved
6. Flexibility– easily switch from one product type to
another, using flexible workers that perform many different tasks
10-6Copyright 2011 John Wiley & Sons, Inc.
Elements of Lean
Lean is composed of three elements that work in unison:
• Lean Production
• Total Quality Management (TQM)
• Respect for People
10-7Copyright 2011 John Wiley & Sons, Inc.
Elements of Lean
10-8Copyright 2011 John Wiley & Sons, Inc.
Lean Production
Coordinated system for producing the exact products desired, delivered in right quantities to where needed Just-in-Time
• The Pull System
• Visual Signals
• Small Lot Production
• Uniform Plant Loading
10-9Copyright 2011 John Wiley & Sons, Inc.
The Pull System
• Traditional approach– supply chains work as “push” systems
– inventory carried to cover up problems
• Pull approach– each stage in supply chain requests
quantities needed from the previous stage
– no excess inventory generated
– reduced inventory exposes problems
10-10Copyright 2011 John Wiley & Sons, Inc.
Visual Signals
Communication between workstations
• Kanban– “signal” or “card” in Japanese– contains information passed between stations– authorizes production
10-11Copyright 2011 John Wiley & Sons, Inc.
Visual Signals
10-12Copyright 2011 John Wiley & Sons, Inc.
Small Lot Production
The amount of products produced at any one time is small
– reduces inventory and excess processing
– increases flexibility
– shortens manufacturing lead time
– responds to customer demands more quickly
– setup time must be low
10-13Copyright 2011 John Wiley & Sons, Inc.
Uniform Plant Loading
• Problem– demand changes are magnified throughout
the supply chain
– contributes to inefficiency and waste
• Uniform Plant Loading– production schedule is frozen for the month
– also called “leveling”
– helps suppliers better plan own production
10-14Copyright 2011 John Wiley & Sons, Inc.
Respect for People
Respect for all people must exist for an organization to be its best
– flatter hierarchy than traditional organizations
– ordinary workers given great responsibility
– supply chain members work together in cross functional teams
• Look at Role of:– workers, management, and suppliers
10-15Copyright 2011 John Wiley & Sons, Inc.
Role of Workers
Workers have the ability to perform many different tasks and are actively engaged in pursuing company goals
• Worker Duties– improve production process– monitor quality– correct quality problems
• Work in Teams– quality circles
10-16Copyright 2011 John Wiley & Sons, Inc.
Role of Management
Create the cultural change in the organization needed for Lean to succeed
– provide atmosphere of cooperation
– Empower workers to take action based on their ideas
– develop incentive system for lean behaviors
10-17Copyright 2011 John Wiley & Sons, Inc.
Role of Suppliers
Lean builds long-term supplier relationships
– companies partner with suppliers
– improve process quality
– information sharing
– goal to have single-source suppliers
10-18Copyright 2011 John Wiley & Sons, Inc.
Total Quality Management (TQM)
TQM is an integrated organizational effort designed to improve quality at every level
Look at: • Quality Gurus
• Voice of the Customer
• Costs of Quality
• Quality Tools
• ISO 900010-19Copyright 2011 John Wiley & Sons, Inc.
Quality Gurus
10-20Copyright 2011 John Wiley & Sons, Inc.
Voice of the Customer
Quality is defined as meeting or exceeding customer expectations
• Determine customer wants:
– focus groups
– market surveys
– customer interviews
10-21Copyright 2011 John Wiley & Sons, Inc.
Costs of Quality
10-22Copyright 2011 John Wiley & Sons, Inc.
Quality Tools
Lean requires workers to identify and correct quality problems
• Seven Tools of Quality Control:
– Cause and Effect Diagrams– Flowcharts– Checklists– Control Charts– Scatter Diagrams– Pareto Analysis– Histograms
10-23Copyright 2011 John Wiley & Sons, Inc.
Cause and Effect Diagrams
Identify causes of a quality problem– sometimes called “fishbone diagrams”
10-24Copyright 2011 John Wiley & Sons, Inc.
Flowchart
Diagrams the sequence of steps in an operation or process
10-25Copyright 2011 John Wiley & Sons, Inc.
Checklist
Lists common defects and number of occurrences of the defects
10-26Copyright 2011 John Wiley & Sons, Inc.
Control Chart
Determines whether a process is operating within expectations
10-27Copyright 2011 John Wiley & Sons, Inc.
Scatter Diagram
Graph that visually shows how two variables are related to one another
10-28Copyright 2011 John Wiley & Sons, Inc.
Pareto Analysis
Based on the premise that a small number of causes create the majority of problems
– identifies problems based on degree of importance
10-29Copyright 2011 John Wiley & Sons, Inc.
Histogram
Chart that shows the frequency distribution of observed values of a variable
10-30Copyright 2011 John Wiley & Sons, Inc.
ISO 9000
“Family” of standards for quality management
– increased international trade developed a need
– published by International Organization for Standards (ISO) in 1987
– concerns measuring and documenting the quality process
– ISO provides a certification process
• ISO 14000– standards for environmental management
10-31Copyright 2011 John Wiley & Sons, Inc.
Statistical Quality Control (SQC)
SQC is the use of statistical tools to measure product and process quality
Three categories:
• Descriptive Statistics– describe quality characteristics
• Statistical Process Control (SPC)– a random sample of output is used to
determine if characteristics are acceptable
• Acceptance Sampling– sample determines if whole batch is acceptable
10-32Copyright 2011 John Wiley & Sons, Inc.
Sources of Variation
All processes have variation
• Assignable Variation– caused by factors that can be clearly
identified and managed
• Common Variation– inherent in the process
– also called random variation
10-33Copyright 2011 John Wiley & Sons, Inc.
Process Capability
Process Capability evaluates the variation of the process relative to product specifications
• Product Specifications– ranges of acceptable quality characteristics– also called tolerances
• Process Variation– all processes have natural variation– defects are produced when variation exceeds
product specifications
10-34Copyright 2011 John Wiley & Sons, Inc.
Process Variation Equal to Specification Range
10-35Copyright 2011 John Wiley & Sons, Inc.
Process Variation Exceeds Specification Range
10-36Copyright 2011 John Wiley & Sons, Inc.
Process Variation Narrower than Specification Range
10-37Copyright 2011 John Wiley & Sons, Inc.
Process Capability Index
where: USL = upper specification limit
LSL = lower specification limit
• Cp Values:
– Cp = 1: process is minimally capable
– Cp ≤ 1: process is not capable of producing products within specification
– Cp ≥ 1: process exceeds minimum capability10-38Copyright 2011 John Wiley & Sons, Inc.
6
LSLUSL
rangeiationvarprocess
rangeionspecificatproductCp
Cp Example
Given a process with three separate machines that are used to fill jars with pasta sauce.
– specification range is between 30 and 34 ounces– process mean, μ, is 31 ounces
10-39Copyright 2011 John Wiley & Sons, Inc.
Machine σ
A 0.6
B 0.7
C 1.2
Calculate the Cp for each machine to determine capabilities
Cp Example Continued
• A:
• B:
• C:
10-40Copyright 2011 John Wiley & Sons, Inc.
6
LSLUSLCp
11.1)6.0(6
3034Cp
95.0)7.0(6
3034Cp
55.0)2.1(6
3034Cp
Machine A has a Cp > 1, however the process mean is not centered
Cpk Example
Cpk addresses the lack of centering of the process over the specification range
• Machine A:
Cpk = min (1.66, 0.55) = 0.55
10-41Copyright 2011 John Wiley & Sons, Inc.
3
LSL,
3
USLminCpk
)6.0(3
3031,
)6.0(3
3134minCpk
Process Control Charts
Graph that shows whether a sample of data falls within the common range of variation
1. sample process output
2. plot result on the control chart
3. use to determine if process is in control
• can monitor: – variables
• characteristics that can be measured
– attributes• characteristics that can be counted
10-42Copyright 2011 John Wiley & Sons, Inc.
Process Control Charts
10-43Copyright 2011 John Wiley & Sons, Inc.
Control Charts for Attributes
A p-chart monitors the proportion of defective items in a sample
• centerline: average value of p across all samples, p
• UCL = p + z sp
• LCL = p – z sp
where: z = standard normal variablep = sample proportion defective
sp = = standard deviation of
10-44Copyright 2011 John Wiley & Sons, Inc.
n
)p1(p
avg. proportion defective
P-Chart Example
Given the following five samples of data tracking incorrect procedures in a hospital
10-45Copyright 2011 John Wiley & Sons, Inc.
Sample# of Incorrect Procedures # Inspected
Fraction Defective
1 0 10 0.1
2 1 10 0.1
3 2 10 0.2
4 1 10 0.2
5 1 10 0.1
Total 5 50
P-Chart Example Continued
p = 5/10 = 0.10
UCL = p + z sp = 0.10 + 3(0.095) = 0.385
LCL = p + z sp = 0.10 - 3(0.095) = 0.185
10-46Copyright 2011 John Wiley & Sons, Inc.
095.010
)10.01(10.0
n
)p1(psp
What is Six Sigma?
Six Sigma is a quality management process that uses measurement to reduce process variation and eliminate defects
– no more than 3.4 parts per million defective
– sigma stands for # standard deviations of the process
– originated at Motorola in 1970s
– “zero defects”
10-47Copyright 2011 John Wiley & Sons, Inc.
Six Sigma Methodology
Two Aspects:
• Use of technical tools– statistical quality control– seven tools of quality
• People involvement– all employees responsible for rooting out
quality problems– all employees trained to use technical tools
10-48Copyright 2011 John Wiley & Sons, Inc.
Six Sigma Five-Step Plan
Define:– define the quality problem of the process
Measure:– measure the current performance of the process
Analyze:– analyze to root out cause of quality problem
Improve:– improve process by eliminating root causes
Control:– control process to ensure continued improvement
10-49Copyright 2011 John Wiley & Sons, Inc.
10-50Copyright 2011 John Wiley & Sons, Inc.
Lean Six Sigma Supply Chain
Developing a Lean Six Sigma Supply Chain
Steps:
1. Jointly Define Value
2. Conduct Supply Chain Capability Analysis
3. Develop Key Financial & Operational Metrics
4. Identify & Implement System Improvements– Value Stream Mapping (VSM)
10-51Copyright 2011 John Wiley & Sons, Inc.
Impact on Supply Chain Activities• Suppliers
– lower costs due to efficient systems– shorter lead times– lower safety stock
• Operations– proper cycle time calculation ensures
production according to customer demand– uniform work flow– pull production
• Logistics– optimization models to select routes– warehouse design changes reduce waste
10-52Copyright 2011 John Wiley & Sons, Inc.
Review
1. Lean management approach concerns the most efficient use of resources possible. The most important tenet is eliminating waste.
2. Lean consists of 3 elements: Lean Production, Total Quality Management, Respect for people.
3. Lean relies on visual signals to pull products through the system.
4. Jidoka is the authority of every worker to stop the production process.
10-53Copyright 2011 John Wiley & Sons, Inc.
Review Continued
5. The “seven tools of quality control” include cause-and-effect diagrams, flowcharts, checklists, control charts, scatter diagrams, Pareto analysis, and histograms.
6. ISO 9000 standards address quality management. ISO 14000 standards address environmental management.
7. SQC measures and identifies quality problems in both the product and process. 3 categories: descriptive statistics, SPC, acceptance sampling.
10-54Copyright 2011 John Wiley & Sons, Inc.
Review Continued
8. All processes have variation. Assignable variation can be identified and managed. Common variation is inherent in the process.
9. Process capability evaluates the processes ability to meet product specifications.
10.Process control charts ensure that the process is “in a state of control.”
11.Six Sigma uses measurement to reduce process variation and eliminate defects.
10-55Copyright 2011 John Wiley & Sons, Inc.
Copyright 2011 John Wiley & Sons, Inc.All rights reserved. Reproduction or translation of this work beyond that permitted in section 117 of the 1976 United States Copyright Act without express permission of the copyright owner is unlawful. Request for further information should be addressed to the Permission Department, John Wiley & Sons, Inc. The purchaser may make back-up copies for his/her own use only and not for distribution or resale. The Publisher assumes no responsibility for errors, omissions, or damages caused by the use of these programs or from the use of the information herein.
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