Capability Assessment Six Sigma Foundations Continuous Improvement Training Six Sigma Foundations Continuous Improvement Training Six Sigma Simplicity

Key Learning Points  Define and describe capability  Provide simple capability measures  Define and describe capability  Provide simple capability measures

The first responsibility of a leader is to define reality. The last one is to say ‘thank you’. In between the two, the leader must become servant and a debtor. That sums up the progress of an artful leader. Credibility, Kouzes & Posner Credibility, Kouzes & Posner

Definition of capability  A measure of the chance of meeting specifications

Where we are….  Are we capable of  Meeting the customer specifications  Delivering an order in 6 weeks  Keeping Warranty below 0.5M$  Ordering the right paint  Getting castings through hydro test before Friday  Completing the General Arrangement this week  Are we capable of  Meeting the customer specifications  Delivering an order in 6 weeks  Keeping Warranty below 0.5M$  Ordering the right paint  Getting castings through hydro test before Friday  Completing the General Arrangement this week

Where we are going?  Can we become capable of  1000 valves per week  95% clean order entry  Increasing sales by 3M$  Answering the phone in 3 rings  Keeping WIP below 3x output  8 stock turns  Can we become capable of  1000 valves per week  95% clean order entry  Increasing sales by 3M$  Answering the phone in 3 rings  Keeping WIP below 3x output  8 stock turns

CapabilityCapability  The answer to each of these questions is ‘it depends’. Capability measures are designed to make the answers more believable and objective.  Capability helps us predict failure rates, identify process changes and avoid failure modes.  It starts with the definition of success which is the responsibility of leadership.  The answer to each of these questions is ‘it depends’. Capability measures are designed to make the answers more believable and objective.  Capability helps us predict failure rates, identify process changes and avoid failure modes.  It starts with the definition of success which is the responsibility of leadership.

Problem with Spread Target Actual Target Actual Problem with Centering  CapabilityCapability  When we look at our process and at our lack of ability to meet our target levels of performance, we must look at the nature of the difference (delta) between the target and the actual.  Is our problem with centering (or mean) differences?  Is our problem with spread (or variance) differences?  Is our problem with a combination of the two?  This understanding is critical to our ability to improve the process, and it forms the basis of our description of the problem.  When we look at our process and at our lack of ability to meet our target levels of performance, we must look at the nature of the difference (delta) between the target and the actual.  Is our problem with centering (or mean) differences?  Is our problem with spread (or variance) differences?  Is our problem with a combination of the two?  This understanding is critical to our ability to improve the process, and it forms the basis of our description of the problem.

Converting Attribute to Variable  On time/late  Pass / fail  Clean /dirty  Good /bad  Unacceptable late payments  Large penalties  Everyone  Expensive  Fit for purpose  On time/late  Pass / fail  Clean /dirty  Good /bad  Unacceptable late payments  Large penalties  Everyone  Expensive  Fit for purpose  % on time  Within 20 days  6S Audit level C  Count of 1 st time pass or % first time pass  Production capacity  DSO $  450K$ penalties  % of employees  API 610 datasheet

Converting Variables to Attribute Data  As a green belt you will pass or fail. Your project will succeed or fail.  The combination of your project’s primary metric will be acceptable or unacceptable.  As a green belt you will pass or fail. Your project will succeed or fail.  The combination of your project’s primary metric will be acceptable or unacceptable.  You use a measurement system and capability to identify what success will mean and record this in your charter.

Capability and Project Charters  Your project’s progress and $ return on investment will be gradual.  The variation of the X’s that drive the process your team is changing will also be capable of precise measurement.  Your project’s progress and $ return on investment will be gradual.  The variation of the X’s that drive the process your team is changing will also be capable of precise measurement.  Who has a system that can’t fail or can never succeed?  Remember with 6 sigma capability, 3.4 parts per million fail. So design your charter so that when one of these 3 in a million circumstances happen, your project team can still succeed.

ExamplesExamples  95% on time each day for at least 2 weeks  A 3 sigma process to achieve 95% on time  An average of 95% on time for 5 weeks  For 5 weeks in a row the team produced at least 100 units with cycle time of less than 2 days  95% on time each day for at least 2 weeks  A 3 sigma process to achieve 95% on time  An average of 95% on time for 5 weeks  For 5 weeks in a row the team produced at least 100 units with cycle time of less than 2 days

Simple capability measures  % on time  % passed  % accurate  These are so weak that we ask you not to use them to analyse problems or make decisions.  % on time  % passed  % accurate  These are so weak that we ask you not to use them to analyse problems or make decisions.  Weaknesses  1) Sample size (>30 ideal)  Ratios are poor predictors when based on small (less than 20) samples  2) Spread  Without information about spread you are lucky to make accurate predictions about no more than half of the process output  3) Shape  Without knowledge of the shape of capability you cannot diagnose the process

ExerciseExercise  Three casting suppliers offer 95% on time delivery – which is more capable? Total number of deliveries On time Average delivery Latest overdue delivery Delivery date which 95% of products delivered 10095%10 days10 weeks3 weeks 11095%10 days20 weeks10 days 2095%10 days20 weeks10 days

Graphical Representation 1. Gather data 2. Draw a histogram 3. Draw in Boundaries 4. Draw in Specification limits (upper and lower) 5. Identify from the data how many parts per million fall outside the specification limits 6. In this case 3/10 fall outside the limits 7. Analyze process capability 1. Gather data 2. Draw a histogram 3. Draw in Boundaries 4. Draw in Specification limits (upper and lower) 5. Identify from the data how many parts per million fall outside the specification limits 6. In this case 3/10 fall outside the limits 7. Analyze process capability Measure Frequency x x x x x x x x x x Lower specification Limit Upper specification Limit

PresentationPresentation The basic analysis is often enough to begin with. Your Black Belt can assist with Minitab which provides more accurate predictive information.

Step 0 Identify baseline Validate Central Tendency and Spread

Step 1 Define Limits LSL USL Note: Who decides the limits? ?

Step 2 Precision LSL USL Note: Often achieved by splitting into defined categories and working in each in turn

Step 3 Accuracy LSL USL

Step 4 Control LSL USL Note: Team has left!

Special Cases LSL USL Is this two processes or one? If metric is time, is there an echo?

Special Cases LSL USL Typical shape for lead time or a process with rework

Non-graphical descriptions of capability  Parts per million defective PPM  Sigma level (related to PPM)  Sigma levels can also be calculated based on: number of standard deviations between the center of the process and the nearest specification  Parts per million defective PPM  Sigma level (related to PPM)  Sigma levels can also be calculated based on: number of standard deviations between the center of the process and the nearest specification  Note: You may also see reference to long term capability and short term capability. This is a way of showing how a process under tight control today should be expected to perform with minor drift over time. (For processes less than 4 sigma - this effect is rarely significant.)

Capability Assessment Six Sigma Foundations Continuous Improvement Training Six Sigma Foundations Continuous Improvement Training