Lean Six Sigma That Works

Bill Carreira, Bill Trudell

• Publisher: AMACOM
• Year: 2006
• ISBN:
  9780814429457
• Topic: Negocios y empresa
• Subtopic: Operaciones

If lean manufacturing moves your products through processes faster, and Six Sigma improves their quality, just imagine what combining these two powerful disciplines will do for you! Lean Six Sigma That Works provides the key to transforming your results in any manufacturing environment, giving you detailed, practical processes that let you leave the conference room, and get right to work. A strong and sensible combination of the "why" and the "how, " this book gives you a step-by-step improvement plan, plus a thorough understanding of: * cost, cash flow, materials velocity, lead time, balance, waste, and non-value-added processes * value stream mapping and the DMAIC process for solving problems and improving quality profitability * how every form of waste impacts customer satisfaction and the bottom line * and much more Whether you're a seasoned professional, or implementing your first lean sigma project, this invaluable guide offers you a clear path to higher quality, customer loyalty, and increased efficiency.

PART 1

The What

Chapter 1 Overview of Lean Six Sigma

Chapter 2 Customer Satisfaction

Chapter 3 Waste

Chapter 4 Value Added, Nonvalue Added, Required Nonvalue Added

Chapter 5 Flow and Pull vs. Push and Batch; Balance

Chapter 6 Velocity, Throughput, and Lead Time

Chapter 7 Cost and Profit—Cash Flow

Chapter 1

Overview of Lean Six Sigma

Lean Six Sigma is about relentless, sustained improvement—analysis after analysis, metric after metric, and project after project. Lean causes products to move through processes faster, and Six Sigma improves quality.

On the strategic side, Lean Six Sigma is an organizational philosophy of applying relentless efforts to drive waste out of the organization at every level and improve product quality to the level of only 3.4 defects per million opportunities. In a way, it's almost like a religion for which the goal is perfection, which is nearly impossible. Yet, it is the constant striving and never-ending effort to reach it that is important.

On the tactical side, Lean Six Sigma is a very effective approach of combining the principles of Lean Manufacturing and Six Sigma. It is a continuous analysis of the organization to determine where improvement is needed followed by Kaizen events and projects. The projects are managed by means of the Six Sigma define, measure, analyze, improve, and control (DMAIC) process using the many great tools included in the Six Sigma body of knowledge. We will review the DMAIC process in detail later on in the book.

LEAN MANUFACTURING

The basic goals of Lean are high quality, low cost, short cycle times, flexibility, relentless efforts to drive waste out of the organization, and all value being defined by the customer. Waste is anything a customer is not willing to pay for. Value is anything the customer is willing to pay for.

The basic tools of Lean are process maps, baselines, value stream mapping, spaghetti diagrams, time studies, and Kaizen events. A most important tool, the Kaizen event is a focused set of actions on applying or driving one or more of the goals into an area in the manufacturing process.

Manufacturing nirvana is a factory where the only activities occurring and product attributes being produced are those that customers are willing to pay for. No waste, no rework, no nonvalue added, no unwanted features.

SIX SIGMA

Six Sigma is about improving quality by applying a methodical approach to measuring products and processes against metrics, and arriving at improvement activities through the formal DMAIC process. The analytical and improvement tools used in Six Sigma can range from simple to highly complex.

Think of Six Sigma as a big tool box alongside a process for improving quality. This tool box contains a myriad of tools available for an individual or organization to improve quality. Tools and terms can range from simple brainstorming, Pareto analysis, and Kaizen events to the relatively complex such as statistical analysis, hypergeometric distributions, design of experiments, and analysis of variance.

One of the benefits of using the Six Sigma approach is that it is a data-driven improvement process. Processes or areas are measured, data are gathered, and progress is tracked against metrics derived from available data. During all of this, the data are sorted and displayed in charts and analysis that make it meaningful and valuable. It will tell a team where to focus their improvement efforts. This approach is beneficial because it minimizes situations in which precious resources are applied toward feel good projects that create the aura of things getting better, but in reality nothing is changing. With the Six Sigma approach, meaningful metrics are created and tracked so we are only feeling good when we should be.

Unfortunately, the perceived complexity of Six Sigma methodologies can drive many people or organizations away from applying them. This is too bad and unnecessary. Most Lean books are a fairly easy read and can be easily understood by the majority of employees in any manufacturing organization. After all, it is the commonsense attributes and simplicity of Lean principles that make Lean so powerful. Opening up or glancing into a Lean book will probably reveal pictures of work cells or baselines, 5S areas, and so forth, whereas the pages in a Six Sigma book contain graphs of bell curves, calculations of standard deviations, t scores, and analysis of variance tables. It can be overwhelming even to those with knowledge of college-level statistics.

For these reasons, many people shy away from reading Six Sigma books or studying the methodologies. This is unfortunate, because many useful parts of the Six Sigma methodologies need not be any more complex to understand or apply than Lean manufacturing principles. Six Sigma methodologies can be applied in a simple or complex manner, or somewhere in between. Significant improvements or gains can be made using the basic tools, and without applying complex statistical analysis.

APPLYING LEAN SIX SIGMA

Lean Six Sigma is about applying a strategy to improve your business. It can be applied to improve certain areas of your business or operations on a tactical level, or to achieve strategic objectives. One way to determine where to focus Lean Six Sigma tools is to determine what your critical success factors are. In other words, what things (usually three to five of them) are critical to improve your business. You can then apply the DMAIC process and Lean Six Sigma tools to achieve the improvement. These types of efforts are what I call Quick Sigma because they follow a more informal application of the DMAIC process. They do not involve the highly complex and detailed tools of Six Sigma. They are directed to a lower level or to tactical-type projects to eliminate defects in a particular process or area in the plant. An example would be to reduce finish defects in a coating operation.

Strategic objectives, on the other hand, are those objectives that are created by top management directed at improving the business or achieving the organization's vision. These are a big deal and provide a great opportunity for the Lean Six Sigma approach using several of the tools and analysis in the toolbox. An example of a strategic project would be a project to reduce warranty costs to the business. These types of projects are important to the business. The success of these projects can be enhanced when a Six Sigma Black Belt is assigned to manage or lead them. The Black Belt has the knowledge and ability to deploy any of the complex statistical and analytical tools from the tool box. He or she can also provide training to the team as required. However, as you will read ahead, having a Black Belt is not absolutely necessary, but having someone with certain skills is. Not having a Black Belt should not keep you from applying the Lean Six Sigma tools.

Whether tactical or strategic, all Lean Six Sigma projects should be driven by metrics. Each area the company desires to improve must be measured to develop meaningful metrics. Metrics are most effectively applied via dashboards. A dashboard is a cluster of charts, graphs, and other data revealing performance to key metrics. Dashboards are simple, yet powerful tools to communicate progress to everyone in the organization.

The ideal situation is when there are dashboards of integrated metrics at the operator level, supervisory/management level, and executive level. This situation and focused improvement efforts at all these levels ensure that the efforts of the entire organization are focused on achieving the strategic objectives of the company. This is powerful. One cannot overstate the value of having representation and participation from the finance and accounting department in Six Sigma teams. First, their knowledge of cost and financial data will be very valuable in executing projects. This knowledge will help ensure the validity of numbers and metrics used to measure progress. Another benefit is that it will help avoid a situation in which a project team is communicating or reporting their exciting results from their hard work while the finance guy is at the end of the table shaking his head (in the wrong direction!). This situation can take all the fun out of it. Make sure you get a thumbs up from accounting.

KAIZEN OR DMAIC?

The question of when to use a Kaizen event, or when to execute a Six Sigma project with the DMAIC process, is often asked. We believe that Kaizen events are best used to drive process improvements in smaller areas that are not all-encompassing. They are also well suited for applying the basic principles of Lean such as shortening cycle times, improving flow, or eliminating waste. For example, if your team would like to improve efficiencies on an assembly line, a Kaizen event would probably be the best tool. Developing a current state map, a future state map, and a set of actions to realize the latter is a great application for the Kaizen event.

On the other hand, Six Sigma projects using the DMAIC process are well suited for improving quality by reducing defects, improving yield, or attacking situations in which decisions will be made by analyzing relatively significant amounts of data. Any situation that demands or uses statistics leans toward Six Sigma. Problems that are broad-based across the organization are well suited for DMAIC. For example, a Six Sigma/DMAIC project would be the best approach if your goal is to reduce total warranty costs for the organization. This project would require considerable data and analysis to base improvement efforts on. Six Sigma offers great tools for any situation like this in which data will be used. The analytical tools range across all levels of complexity.

One of the key premises of this book is that applying Lean Six Sigma need not be highly complex. However, it is fair to say that you and your team need to become knowledgeable about Lean Six Sigma. It is a journey, and the more you know and familiarize your team with the tools the more successful you will be. It can also be enjoyable because there a lot of great publications out there. As you begin to apply Lean Six Sigma I recommend that you order a handful of the many pocket guides, books, and pamphlets on Lean Six Sigma that are on the market. There is no shortage of them. Pass them around to your staff. I find reading them very enjoyable. Get one of the pocket-size guides and put it in your brief case. They make for great reading in the airport or while your car is getting its oil changed.

DMAIC PROCESS

Here is a brief overview of the Six Sigma DMAIC process.

Define

The Define stage of the DMAIC process is where the problem or objective is clearly defined. What is it we are trying to accomplish? What are we trying to do? For strategic and higher level projects, a Project Charter is formed that lays out the intent and objective of the project. Top management signs off and designates a Champion and a Project Leader to ensure the support of the process in time and resources. This is top management's way of saying hey, this project is critical and highly important and it has our full support, and our expectation of results.

Some of the tools used in the Define phase include Project Charter, SIPOC diagram (suppliers, inputs, process, output, and customers), process mapping, and benchmarking. We will review these in more detail later.

Measure

The goal of the Measure phase is to focus the improvement effort by gathering information on the current situation. The process is measured, data are gathered, and metrics are created. For strategic projects the whole Six Sigma toolbox of tools is at your doorstep. You are only limited by your ability, or your Black Belt's ability to apply them. It can be complex, but it can also be fun. These tools are powerful and effective. They are all tied to metrics, and if used properly a movement in t...

Table of contents

• Cover Page
• Title Page
• Copyright Page
• Dedication Page
• Contents
• Preface
• Introduction: The Why
• Part 1: The What
• Part 2: The How
• Index
• About the Authors