Lt module 01 ls overview - rev b

© PPL Corporation 2011

Lean Technician ProgramLeanSigma Overview



Objectives

At the conclusion of this module you will be able to: Define the term Lean Define the term Six Sigma Understand how LeanSigma is:

– A Philosophy

– A Methodology

– A Measure

– A Culture

Discuss how LeanSigma is aligned with business and individual objectives

Discuss how Lean and Six Sigma work together to optimize processes

Understand some of the tools and measures Understand how LeanSigma makes our jobs easier!


Question Time?

• Are long working hours Common?• Is rework (doing the same task multiple times) a fact of life?• Do employees spend a lot of time compiling, re-compiling, editing?• Is there more than one way to perform a task?• Has the company grown without changing practices?• Have “Band-aids” been applied to areas that are broken?• Do you have standardized procedures?• Do you implement best practices?• Do employees understand how their role affects the process?• Do people communicate the right information at the right time to the right

people?

Does this ever occur?


Ensure highly effective World Class processes that are cost competitive and consistent with customers needs

Implement and Sustain change initiatives to improve performance

Lead initiatives to reduce operating costs to industry leading levels

Develop and implement blueprint for a World Class LeanSigma Enterprise

– common processes, measurements and systems– common training and skill requirements

What is LeanSigma Designed to do?


Lead TimeLead Time

Non Value Adding (NVA)Value

Adding

Typical Value-Adding** Typical Value-Adding** ratioratio

85% 15%

NVA

If focus is only on If focus is only on improving Value-Adding improving Value-Adding operationsoperations

87.5%

VA

12.5%

Companies decrease lead time Companies decrease lead time rapidly by reducing non value-rapidly by reducing non value-adding activity!adding activity!NVA VA

50% 50%

World Class Enterprise


People tend to support what they help create;

Tell Me and I Will Forget

Show Me and I Will Remember

Involve Me and I Will Understand

Learning Philosophy


The vision should be an integrated business system that links people and processes across the entire value stream ( Series of activities and materials )

“Improvement in Isolation is Not Effective”

Sales &

MarketingEngineering SCM Shop Floor Production

CUSTOMER

SERVICE

Information

Systems

Human

ResourcesQuality

SystemsSuppliers

There is no I in Team?


Lean Thinking

TransactionalSigma Lean Thinking means challenging the existing administrative processes and practices that:

– Are no longer applicable in a Lean Environment, and/or– Support business needs that no longer exist, and/or– Are complex and require simplification.

The following slides list typical questions that should be asked to generate ideas for LeanSigma Transactional Teams.


LeanSigma Thinking

Sales, Marketing, Order processing– What is the value to the organization in having complete and accurate

information in the quoting process?– What is the cost of selling products and services that do not fit well in the

production value stream?– How can you reduce the number of order entry transactions?– Can you eliminate manual interfaces by some means of electronic data

interchange methodology?– What would be the effect of reducing the skills required to perform order

processing using work simplification and standardization?


Human Resources– What would be the benefit of reducing the effort associated with payroll-related

activities such as processing and correcting time cards?– What would be the benefit to the organization of simpler, more frequent

employee reviews focused on value stream performance?– How can compensation practices be changed to reinforce lean behaviors such as

teamwork, standardized work, and cross training?– What would be the impact to the organization on employee retention of improving

the screening, hiring, and orienting process?

LeanSigma Thinking


LeanSigma Thinking

Supply Chain– Are there better ways to control inventory that require less effort while providing

the desired results? Using Visual Management?– How you reduce inventory transactions? What will be the impact of reduced

inventory transactions on the quality of data and information?– What activities will change with the incorporation of vendor managed inventories?– What is the impact on the value stream if you eliminate purchase orders?– How can you use the newly available time of purchasing and inventory

management personnel to improve supplier performance?


LeanSigma Thinking

Accounting– What is the time and effort required to perform month-end closing activities?– How will more real time financial and accounting information benefit the decision

making process and the organization in general?– What changes are required in the accounting process to support a lean

transformation of manufacturing?– What would be the impact to the organization if the accounting function reduced

its portion of the order-to-cash process?


What is Lean?

Lean is the elimination of anything not absolutely required to deliver a quality product or service, on time, to our customers.

Lean focuses on improving process flow. Lean is a means of driving process standardization. Lean drives work at the pull of the customer.


Lean Focuses on Waste

All Waste degrades performance

There are 8 Primary Sources of Waste:

− Defects− Over production − Waiting− Not Using Talent− Transportation − Inventory− Motion− Extra Processing

Lean eliminates waste, improving process Speed

• Identified

• Quantified and prioritized

• Eliminated or greatly reduced

Sources of waste can be:


History of Lean

Taiichi Ohno of Toyota was the primary architect Started with a factory/manufacturing orientation Developed to systematically attack the eight types of

muda (waste) Tools and methods evolved by trial and error over

decades The result was the Toyota production system; the basis of

all lean systems


What is Six Sigma?

Six Sigma is a philosophy for managing process improvement.

Six Sigma is a means of continuously improving to meet customer needs.

Six Sigma is a method for reducing process variation and improving process stability.

Six Sigma is a measurement of defects and variation.


Six Sigma Focuses on Variation

All variation degrades performance

Variation buffers include:– Inventory– Time– Extra Capacity

Not all variation is bad– New products– New services

Six Sigma focuses on– Variation due to process– Variation due to flow

Six Sigma improves Stability and Accuracy

• Identified

• Quantified and prioritized

• Eliminated or greatly reduced

Sources of variation can be:


History of Six Sigma

Originated in Motorola in the mid ’80’s– Lots of tools, but no method for solving problems

Six Sigma Black Belt methodology began in late 80’s/early 90’s. Many companies have embraced Six Sigma:

– Allied Signal – 1994– The Stanley Works – 2004– Air Products – Prior to 2000– GE – 1996– Bank of America - 2002

Strategically driven program with top down projects that yield high Return on Investment

Follows LeanSigma roadmap to identify problem’s root causes and implement improvements


Sigma: The Measure

LeanSigma the Methodology, uses Sigma the Measure to Quantify Process Performance

LeanSigma the Methodology, uses Sigma the Measure to Quantify Process Performance


Sigma: The Measure

Source: Journal for Quality and Participation, Strategy and Planning Analysis

World Class99.9997% 3.4 <10% 6

Industry Average

99.4% 6,210 15-20% 4

99.976% 233 10-15% 5

93% 66,807 20-30% 3

Non Competitive65% 308,537 30-40% 2

50% 500,000 >40% 1

Yield DPMO COQ Sigma

What is 15 - 20% of Revenue worth to you?

Cost of Quality – total costs of quality issues to products, process,

opportunities and customers


Say you played 100 rounds of golf per year… what would a Six Sigma be in your game?

2 sigma - you'd miss 6 putts per round

3 sigma - you'd miss 1 putt per round

4 sigma - you'd miss 1 putt every 9 rounds

5 sigma - you'd miss 1 putt every 2.33 years

6 sigma - you'd miss 1 putt every 163 years

Understanding LeanSigma Levels


What Does LeanSigma Mean In Your Daily Life?

99% Good (3.8 Sigma) 99.99966% Good (6 Sigma)

Postal System

20,000 Lost Articles of Mail / Hr

Airline System

Two Short-Long Landings / Day

Medical Profession

200,000 Wrong Drug

Prescriptions / Week

Postal System

7 Lost Articles of Mail / Hr

Airline System

1 Short-Long every 5 Years

Medical Profession

68 Wrong Drug

Prescriptions / Week


What Does LeanSigma Mean Your Daily Life?

Tax Advice

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


Lean Removes WasteSix Sigma Optimizes

Inputs Process Outputs

Removes WasteRemoves Waste

Removes VariationRemoves Variation


Why Six Sigma + Lean?

Traditional Six Sigma deals with Variation: “How can we eliminate process variation and defects?”

Lean strategies look at Speed: “How can we do the work faster and more efficiently?”

Not all projects need all the tools.

TripleConstraint

QualityDelivery

Cost


Why Lean + Six Sigma?

LeanLean• Waste Elimination• Standard Work• Flow• Customer PULL

SPEED

Six SigmaSix Sigma• Variation Reduction• Scrap / Rework Elimination• Process Optimization• Process Control

STABILITY & ACCURACY

LEANLEAN + + SIX SIGMASIX SIGMA = A POWERFUL COMBINATION = A POWERFUL COMBINATION


LeanSigma Benefits

Our Company: Financial savings Better cash flow Increased revenue Waste, defect and variation

reduction Improved efficiency Higher skilled workforce Commonality – tools, language Our Customers:

Requirements consistently met Higher quality Consistent on time delivery Higher satisfaction


LeanSigma is…

….A Philosophy that – Focuses on continuous organizational improvement– Institutes data driven decision making– Covers the whole business value stream– Aligns projects with strategy– Drives big results

and

….A Methodology that– Is based on Lean and Six Sigma tools– Provides a problem solving roadmap– Uses a set of data driven tools to measure process performance and

identify critical process drivers


LeanSigma is….

…a simple, unique, proven and lasting approach for improving our business performance based on:

Alignment of the customer, strategy, processes and people Big, measurable business results Selective but broad deployment of advanced quality and

statistical tools


LeanSigma Focuses on Processes

“85% of the reasons for failure to meet customer requirements are related to deficiencies in systems and processes… rather than the employee. The role of management is to change the process rather than badgering individuals to do better.”

- W. Edwards Deming


Decision MakingPath

Types of ProblemsYou Will Normally Solve

1. Intuition, gut feel, I think…

2. We have data and look at it

3. We make graphs / charts of the data

4. We use advanced statistical toolsto evaluate the data

Simple

Complex

Changing The Decision Making Processes

How Many Times Have Your Heard This?“I Think The Problem Is…”

How Many Times Have Your Heard This?“I Think The Problem Is…”


Roles and Responsibilities

Executive Team

Champion

Master Black Belt

Team Members

Green Belt

Lean Techs

Black Belt

Projects / Team Direction

Reporting

Support

Strategy / Annual Operating

Plan


The Roadmap

MeasureMeasure AnalyzeAnalyze ImproveImprove ControlControl Initiate the

Project

Define the Process

Determine Customer Requirements

Define Key Process Output Variables

Verify Critical Inputs Using Planned Experiments

Design Improvements

Pilot New Process

Lean Tool Applied

Analyze Data to Prioritize Key Input Variables

Identify Waste

Finalize the Control System

Verify Long Term Capability

Understand the Process

Evaluate Risks on Process Inputs

Develop and Evaluate Measurement Systems

Measure Current Process Performance

DefineDefine

3 - 4 weeks 4 – 6 weeks On-going


Using Lean Tools Within the LeanSigma Roadmap

Define Measure ControlImproveAnalyze

Baseline analysis Process observation Value Stream Map

Spaghetti diagrams Time Value Chart TAKT time / Cycle time

Cell Design Kanban / Pull Mistake Proofing Improvement Events 5S Improvement

Performance to TAKT Standard Work

Charter

Purpose


Summary

Six Sigma is:– An initiative used to proliferate process improvement in any organization– A problem solving approach based on following the DMAIC roadmap that

focuses on reducing variation– A measure of defects

Lean is:– A set of tools used to reduce waste in a process, thus increasing process velocity

Six Sigma focuses on variation, Lean on speed

Lean and Sigma together, form LeanSigma and enable us to drive breakthrough improvements in our organizations.

Lean and Sigma together, form LeanSigma and enable us to drive breakthrough improvements in our organizations.

Lt module 01 ls overview - rev b

Business

Transcript of Lt module 01 ls overview - rev b