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Lean vs. Six Sigma Lean vs. Six Sigma.

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Presentation on theme: "Lean vs. Six Sigma Lean vs. Six Sigma."— Presentation transcript:

1 Lean vs. Six Sigma Lean vs. Six Sigma

2 Understand DMAIC and Lean Methodologies.
Learning Objectives Lean vs. Six Sigma Understand DMAIC and Lean Methodologies. Where are Six Sigma and Lean Methodologies used? What are the tools used for Six Sigma and Lean? What are the differences between Six Sigma and Lean? Lean vs. Six Sigma 2 .PPT

3 Six Sigma Basic Premise
Lean vs. Six Sigma Y f (X) = Outputs (CTQ) Inputs Do you know what is important to customers? Do you know what “Xs” are important to meet customer needs? How do the “Xs” drive outcomes, revenue, and cost? The Equation: “Y= f (X)” Lean Six Sigma is about improving what is important or “critical to the customer and quality (CTQ).” Y is the measurement of the CTQ that needs to be improved to meet customer needs. Once you understand what the Ys are, (those things critical to customers and quality), measure them and compare them to the targets. Understand the process characteristics that may cause variation and then reduce this variation by controlling the process variables. These process variables are called the Xs. There may be many Xs that can affect the Y. This simple equation is used to help communicate what a project is trying to accomplish. If Y is a function of X, then identify the Xs with enough precision to first improve them and then control them. Once Xs are maintained, the Y will be met. Lean vs. Six Sigma 3 .PPT Your role is to identify the Xs that cause negative variation and improve on them.

4 Six Sigma DMAIC Methodology
Lean vs. Six Sigma Control Improve Analyze Measure Define Test Hypotheses List Vital Few Xs Identify Control Subjects Develop Feedback Loops Develop Process Control Plan to Hold the Gains Implement, Replicate Select the Solution Design Solution, Controls, and Design for Culture Prove Effectiveness Develop Project Charter Determine Customers & CTQs Map High-Level Process Establish and Measure Ys Plan for Data Collection Validate Measurement System Measure Baseline Sigma Identify Possible Xs Six Sigma DMAIC Methodology The five phases of DMAIC are summarized here. In the Define Phase, the problem or Y is defined. In the Measure Phase, the Y is measured (size and span). In the Analyze Phase, the Xs are analyzed and are proven or disproven as to whether they belong in Y = f (X). In the Improve Phase, the levels of Xs are determined to achieve the desired level of Y performance. In the Control Phase, the Xs are controlled to those determined levels so that the desired Y performance is ensured. Focus on controlling the Xs, instead of inspecting Y. Lean vs. Six Sigma 4 .PPT

5 Y Xs Goal: Y = f ( x ) Six Sigma Methodology Define Practical Problem
Lean vs. Six Sigma Y Xs Measure Analyze Improve Control Characterization Process Optimization Goal: Y = f ( x ) Define Practical Problem Statistical Problem Statistical Solution Practical Solution Attacking Problems This slide summarizes how Six Sigma attacks problems. Translate a practical problem into a statistical problem so it can be analyzed statistically and come up with a statistical conclusion. Then translate the statistical conclusion back into the practical world so that you can implement those practical solutions. Lean vs. Six Sigma 5 .PPT

6 Insufficient Process Capability
Sources of Variation Lean vs. Six Sigma y x Poor Design Changing Needs Measurement System Insufficient Process Capability Variation Skills & Behaviors All products and services are designed with good intentions but without knowing what variables will cause the product or service to not meet customer needs over time. Over time excess variation from these root causes must be reduced. List examples of process variation in your system. Lean vs. Six Sigma 6 .PPT 1. 2. 3. 4. 5.

7 Lean Methodology Lean vs. Six Sigma Define Value Measure Value Analyze
Analyze the Value Stream Attribute Map Analyze the Process Load and Capacity Perform VA/NA Decomposition Analysis Apply Lean Problem Solving to Solve for Special Causes Stabilize and Refine Value Stream Complete Process and Visual Controls Identify Mistake-proofing Opportunities Implement S4-S6 Control Plan, Monitor Results, and Closeout Project Conduct the Rapid Improvement Event Design the Process Changes and Flow Feed, Balance, Load the Process Standardize Work Tasks Implement New Processes Define Stakeholder Value and CTQs Define Customer Demand Map High-level Process Assess for 6S Implementation Measure Customer Demand Plan for Data Collection Validate Measurement System Create a Value Stream Attribute Map Determine Pace, Takt-time and Manpower Identify Replenishment and Capacity Constraints Implement S1-S3 Control Process Improve Process - Pull Analyze Process - Flow Measure Value Define Value Lean Methodology This slide summarizes the Lean methodology. Lean focuses on value and flow. Lean vs. Six Sigma 7 .PPT

8 Why Define a Process as a Value Stream?
Lean vs. Six Sigma A Value Stream Focuses attention on what is important for the customer. Identifies all the necessary components to bring a product or service from conception to commercialization. Identifies waste inherent in processes and works to remove it. Reduces defects in products and deficiencies in processes. Focuses on improving specs and cost. Value Streams As part of the focus, processes are viewed as value streams. What value Is provided through each step of the process and what can be done to improve value-add. Waste and non-value add is removed or reduced. Lean vs. Six Sigma 8 .PPT

9 What Is Typically Found
Lean vs. Six Sigma Lean Value Stream Management starts with defining value in terms of products and process capabilities to provide the customer with what they need at the right time and at an appropriate price. Value added Non-value added/waste Value-Added Activity An activity that transforms or shapes material or information to meet customer requirements. Those activities that require time or resources, but do not add value to the customer’s requirement (but may meet company requirements). Non-Value Added Activity (COPQ) Lean vs. Six Sigma 9 .PPT

10 The Eight Wastes Lean vs. Six Sigma
Overproduction—making or doing more than is required or earlier than needed. Waiting—for information, materials, people, maintenance, etc. Transport—moving people or goods around or between sites. Poor process design—too many/too few steps, non- standardization, inspection rather than prevention, etc. Inventory—raw materials, work-in-progress, finished goods, papers, electronic files, etc. Motion—inefficient layouts or poor ergonomics at work-stations or in offices. Defects—errors, scrap, rework, non-conformance. Underutilized personnel resources and creativity—ideas that are not listened to, skills that are not utilized. adapted from Taiichi Ohno How to Identify the Eight Wastes Overproduction—making or doing more than is required or earlier than needed What is the minimum quantity the customer needs? What is the minimum order quantity or lot size? Waiting—for information, materials, people, maintenance, etc. Any wait-time is waste. Look to eliminate or minimize by ensuring that items arrive only when they are truly needed. Transport—moving people or goods around or between sites Although some is necessary, this is also pure waste. Calculate the amount of travel distance and number of times items, materials, and WIP are moved per day (Spaghetti Diagram). Look to minimize distance or number of daily moves. Poor process design—too many/too few steps, non-standardization, inspection rather than prevention, etc. This is attacked through VA/NVA analysis. U-shaped cells and moving areas in close proximity. Standardize on a size (i.e. using same screw size for all assemblies). Design to eliminate inspection. Inventory—work-in-progress, papers, electronic files, etc. Calculate days of supply for all goods. Understand how long it takes to replenish each item (more frequent supplies means less inventory). Develop strategy for the amount of supply to keep. Monitor and measure. Motion—inefficient layouts at workstations; poor ergonomics in offices Motion requires detailed analysis of movements. Defects—errors, scrap, rework, non-conformance Any defect is waste. Use Pareto Analysis to identify key defect reasons. Need to understand causes of the errors—use cause-effect diagram. Look to eliminate all causes through mistake proofing. Underutilized personnel resources and creativity—ideas that are not listened to, skills that are not utilized Remember, that everyone can contribute. Lean vs. Six Sigma 10 .PPT

11 US war production TPS Lean JIT Lean 6s
History of Lean Lean vs. Six Sigma Toyota Ohno and Shingo Flow of work Small batch sizes New philosophy Womack “Mach. Changed World” Eliminate Waste Improve performance Flexibility Just-in-Time Schonberger “Japanese Mfg Techniques” Takes TPS and imports to US Added to 6s tool kit Large quantities Rapid pace High training US war production TPS Lean JIT Lean 6s History of Lean The historical development that led to Lean and to Lean Six Sigma is summarized here. During the WWII war production years, the focus was on large quantities. The Toyota Production System (TPS) focused on streamlining flexible production flow through reduced batch sizes, improved quality, and producing to the pull of customer demand. JIT or Just-In-Time production expanded the application, philosophy, tools, and techniques of TPS to the U.S. and other parts of the world. JIT is synonymous with TPS. Lean took it one step further. Womack in his seminal book expanded TPS/JIT to include all industries—services and other non-manufacturing industries. Lean focuses on flow, flexibility and speed, and the minimizing of waste. The waste or obstacles are obvious after some simple analysis. Six Sigma focuses on reducing variation and ensures that the Xs in Y = f (X) are determined and controlled to solve chronic problems. The Xs are usually not obvious. High consistent quality is the result. Lean Six Sigma deployment marries the two to enable companies to address a larger variety of problems. Depending on the type of problem, Lean or Six Sigma or a combination of both will be used. Lean vs. Six Sigma 11 .PPT

12 Lean & Six Sigma Methods Results The Methods Lean vs. Six Sigma
Improve Speed Higher Quality Lower Costs Sustain Performance Culture Change Achieve Breakthrough Dashboard Results The Methods Lean and Six Sigma enable and provide the right tools, the right projects, and the right processes to drive sustainable breakthrough improvements resulting in improved quality, lower costs, improved dashboard metrics, and culture change. Lean vs. Six Sigma 12 .PPT

13 How to Think About Improvement
Lean vs. Six Sigma The Juran Trilogy ® Plan Control Improve DFSS RCCA Lean Six Sigma Time Lessons Learned Breakthrough Sporadic Spike Six Sigma & Beyond Chronic Waste COPQ Key Word Is “Breakthrough” Breakthroughs achieve substantially higher levels of performance quickly. Breakthroughs do not just happen. They require a systematic change process, one that can be achieved with the “project-by-project” approach. Costs of Poor Quality (COPQ) are those costs that would disappear if every task were done perfectly the first time, every time. It can also be defined as the difference between the theoretical minimum cost and the actual cost. Improving products, processes, and services is a never-ending pursuit. Achieving breakthroughs may require a tenfold improvement, or even better than 3.4 ppm, which is a Six Sigma level. Lean and Six Sigma are methodologies and toolsets that can enable an organization to improve performance systematically. For an organization to continue making breakthroughs and meet the needs of their stakeholders, they must master the skills to plan, control, and improve quality. Accelerated Change Management Support Lean vs. Six Sigma 13 .PPT

14 Matching Improvement Process to Need
Lean vs. Six Sigma Change Management Plan, Do, Study, Act (PDSA) Lean & Six Sigma DMAIC Design for Lean Unclear Solution Clear Solution Radical Moderate Small Gains or Clear Solution Launch New Product, Service, or Process Large Gains Medium Definitions Change Management is about anticipating and planning for human reaction to improvements, in addition to the technical and business components of the change. It begins with understanding the values and habits of the population that must change. It develops the means to promote that change among the target population members, including communication, changes in reward and recognition, and adaptation of details of the change in ways that are consistent with the population values. Root Cause Corrective Action (RCCA): Provides a means to attack sporadic spikes or special causes that occur daily. Lean and Six Sigma (DMAIC): Lean is a set of methods used to eliminate non-value added tasks and increase speed. The Six Sigma method of Define-Measure-Analyze-Improve-Control (DMAIC) is a business improvement approach that drives dramatic breakthroughs in performance. Lean Six Sigma is not watered down Six Sigma, it means Six Sigma combined with the Lean methods to remove waste and speed up processes. The combination is more powerful than either alone. Design for Six Sigma (DMADV): This method of Define-Measure-Analyze-Design-Verify (DMADV) is used to design or redesign processes, services, and products at high sigma levels so that they are almost flawless from the beginning. Lean vs. Six Sigma 14 .PPT

15 Lean and Six Sigma Lean vs. Six Sigma LEAN = Improvement principles focused on dramatically improving process speed and eliminating the eight deadly wastes. Improve Process- Pull Control Process Analyze Process-Flow Measure Value Define SIX SIGMA = Breakthrough Process, Design, or Improvement Teams focused on eliminating chronic problems and reducing variation in processes. Lean vs. Six Sigma 15 .PPT

16 Lean Project Attributes
Lean vs. Six Sigma Simply stated: “Lean is about moving the Mean.” It focuses on efficiency. Lean reduces average cycle time. Lean reduces excess inventory. Lean improves average response time. Improvement Lean Project Attributes Note the shift in the mean. For example, the mean cycle time is reduced. Lean vs. Six Sigma 16 .PPT

17 Increase Process Yield
Six Sigma Attributes Lean vs. Six Sigma Simply stated: “Six Sigma is about Reducing Variation.” It focuses on Effectiveness. The mean will most likely also be improved. Decrease defect rate Increase Process Yield Improvement Six Sigma Attributes Note the shift in the mean and the reduced variation. Lean vs. Six Sigma 17 .PPT

18 Lean and Six Sigma Lean vs. Six Sigma Six Sigma = Breakthrough Process Improvement Teams focused on eliminating chronic problems and reducing variation in processes. Lean = Rapid Improvement Teams focused on dramatically improving process speed, and the elimination of the eight deadly wastes. IMPROVED EFFICIENCY Improve Process- Pull Control Process Analyze Process-Flow Measure Value Define EFFECTIVENESS Lean vs. Six Sigma 18 .PPT

19 Lean Six Sigma Lean vs. Six Sigma Lean Six Sigma is an approach to integrating the power of Six Sigma Tools and Lean Enterprise Tools which can be applied within an organization to create the fastest rate of improvement, maximize shareholder value, and increase customer delight. Improve Process- Pull Control Process Analyze Process-Flow Measure Value Define Lean Six Sigma As needed, a project can be a Lean project, a Six Sigma project, or a Lean Six Sigma project which uses the tools of both Lean and Six Sigma, as appropriate. Lean vs. Six Sigma 19 .PPT

20 Which Technique to Begin With?
Lean vs. Six Sigma It is often advantageous to begin with Lean projects. These are easier to understand and implement. Begin with streamlining processes and Rapid Improvement Events. This gets the operation in good order. Chronic problems are now easier to deal with. “Low Hanging Fruit” is eaten. Next, select Six Sigma projects Other Reasons to Begin Lean? Lean attacks obvious waste. Lean vs. Six Sigma 20 .PPT

21 Improve assembly line throughput Reduction in Finished Goods Inventory
Lean Projects Lean vs. Six Sigma Use Lean when you are trying to streamline any process and reduce process waste. Improve assembly line throughput Reduction in Finished Goods Inventory Reduce the time to process new proposals Reduce machine setup time Improve order processing time Lean Projects Examples of Lean projects are listed here. Note the emphasis on flow, speed, and time. Lean vs. Six Sigma 21 .PPT

22 Improve yield on a continuously running machine
Six Sigma Projects Lean vs. Six Sigma Use Six Sigma where process metrics are more difficult to collect or understand, and project success requires analysis of multiple input factors (Xs). These are often chronic problems. Improve yield on a continuously running machine Reduce defects on a machine with multiple inputs and machine settings Reduce the amount of wait time for a call center Improve the number of quality new hires Six Sigma Projects Note the emphasis on determining the root causes (that we do not know or are not obvious) and determining the best levels of Xs in Y=f (X). Lean vs. Six Sigma 22 .PPT

23 It is all about the correct tools.
Mixed Projects Lean vs. Six Sigma What happens when you start a Six Sigma Project and it turns into a Lean project? It is all about the correct tools. Use the Lean tools for project success. What happens if a Lean project turns into Six Sigma? Depending when this is discovered, it may mean going back to utilize some Six Sigma tools before proceeding. Mixed Projects As indicated earlier, both sets of tools may be needed. For example, a Six Sigma project may determine in the Analyze Phase that there is no standard process or there is no process in place. In the Improve Phase, the team will want to conduct a Lean event to develop the best standard work process. Alternatively, a Value Stream project may find that certain portions of the Value Stream have too much variation. Six Sigma tools will be used to determine the Xs that drive the variation in Y = f(X) and thus, improve process capability. If it is a big effort, then a Six Sigma sub-project is launched as part of that Value Stream Management project. Lean vs. Six Sigma 23 .PPT

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