Lean Six Sigma Measure Phase Tollgate Review

1. Measure Phase • Lean Six Sigma Measure Phase Tollgate Review

2. Lean Six Sigma DMAIC Tools and Activities • Review Project Charter • Validate High-Level Value Stream Map and Scope • Validate Voice of the Customer & Voice of the Business • Validate Problem Statement and Goals • Validate Financial Benefits • Create Communication Plan • Select and Launch Team • Develop Project Schedule • Complete Define Tollgate • Value Stream Map Flow • Identify Key Input, Process and Output Metrics • Develop Operational Definitions • Develop Data Collection Plan • Validate Measurement System • Collect Baseline Data • Determine Process Capability • Complete Measure Tollgate • Identify Root Causes • Reduce List of Potential Root Causes • Confirm Root Cause to Output Relationship • Estimate Impact of Root Causes on Key Outputs • Prioritize Root Causes • Value-Add Analysis • Takt Rate Analysis • Quick Wins • Statistical Analysis • Complete Analyze Tollgate • Develop Potential Solutions • Evaluate, Select, and Optimize Best Solutions • Develop ‘To-Be’ Value Stream Map(s) • Develop and Implement Pilot Solution • Implement 5s Program • Develop Full Scale Implementation Plan • Cost/Benefit Analysis • Benchmarking • Complete Improve Tollgate • Develop SOP’s, Training Plan & Process Controls • Implement Solution and Ongoing Process Measurements • Confirm Attainment of Project Goals • Identify Project Replication Opportunities • Training • Complete Control Tollgate • Transition Project to Process Owner Improve Control Define Analyze Measure • Mistake-Proofing/Zero Defects • Standard Operating Procedures (SOP’s) • Process Control Plans • Visual Process Control Tools • MGPP • Statistical Process Controls (SPC) • Solution Replication • Visual Workplace • Metrics • Project Transition Model • Team Feedback Session • Replenishment Pull/Kanban • Stocking Strategy • Process Flow Improvement • Process Balancing • Analytical Batch Sizing • Total Productive Maintenance • Design of Experiments (DOE) • Solution Selection Matrix • Piloting and Simulation • Work Control System • Setup reduction • Pugh Matrix • Pull System • Value Stream Mapping • Process Cycle Efficiency/Little’s Law • Operational Definitions • Data Collection Plan • Statistical Sampling • Measurement System Analysis (MSA) • Gage R&R • Kappa Studies • Control Charts • Spaghetti Diagrams • Histograms • Normality Test • Process Capability Analysis • Process Constraint ID and Takt Time Analysis • Cause & Effect Analysis • FMEA • Hypothesis Tests/Conf. Intervals • Simple & Multiple Regression • ANOVA • Components of Variation • Conquering Product and Process Complexity • Queuing Theory • Project Charter • Voice of the Customer and Kano Analysis • SIPOC Map • Project Valuation/ROIC Analysis Tools • RACI and Quad Charts • Stakeholder Analysis • Communication Plan • Effective Meeting Tools • Inquiry and Advocacy Skills • Time Lines, Milestones, and Gantt Charting • Pareto Analysis Kaizen Events Targeted in Measure to Accelerate Results International Standards for Lean Six Sigma

3. Project Charter Problem:Describe problem in non-technical terms • Statement should explain why project is important; why working on it is a priority Goal: Goals communicate “before” and “after” conditions • Shift mean, variance, or both? • Should impact cost, time, quality dimensions • Express goals using SMART criteria • Specific, Measurable, Attainable, Resource Requirements, Time Boundaries • Explain leverage and strategic implications (if any) Problem/Goal Statement Financial Impact • State financial impact of project • Expenses • Investments (inventory, capital, A/R) • Revenues • Separate “hard” from “soft” dollars • State financial impact of leverage opportunities (future projects) Team Tollgate Review Schedule • PES Name Project Executive Sponsor (if different from PS) • PS Name Project Sponsor/Process Owner • DC Name Deployment Champion • GB/BB Name Green Belt/Black Belt • MBB Name Master Black Belt • Core Team Role % Contrib. LSS Training • Team Member 1 SME XX YB • Team Member 2 TM XX GB • Team Member 3 SME XX PS • Extended Team • Team Member 1 BFM XX Not Trained • Team Member 2 IT XX Not Trained TollgateScheduledRevisedComplete Define: XX/XX/XX - XX/XX/XX Measure: XX/XX/XX XX/XX/XX XX/XX/XX Analyze: XX/XX/XX XX/XX/XX XX/XX/XX Improve: XX/XX/XX XX/XX/XX XX/XX/XX Control: XX/XX/XX XX/XX/XX XX/XX/XX • Review high-level schedule milestones here: • Phase Completions • Tollgate Reviews Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

4. Data Collection Plan • For each performance measure (Y), update a data collection plan • Include MSA measure plan (Gantt chart, MS project plan is Optional) • Add Financial measure plan if separate from performance Y • Add any Time Study or other data collection plans for Value Stream Map • Sample Size Calculation • Use additional slides if needed Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

5. Operational Definitions • Y – Continuous data (Process start/stop and cycle time boundaries (such as the unit of measure (ex minutes), the unit (the thing you are measuring), will you include weekends, holidays, non-business hours?) • Y – Discrete data (Define Success/Defect or other attribute values you will measure • X – The subgroups values or X-factor groupings you will use on your project data collection • Other unique terms that apply to your project that require clear operational definitions • Use additional slides as needed to complete your operational definitions Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

6. MSA Conclusions • The measurement systems are acceptable. The data is considered to have no potential for significant error. Need to be careful to appropriately use the data during the Analyze Phase. Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

7. Baseline Basic Statistics • The current process has a non-normal distribution with the P-Value < 0.05 but does have a normal bell-shape. • Since the mean and median are the same in days (29) +/- 0.5 days, we will not transform data. • The range is 35 and the standard deviation is 2.7 days Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

8. Baseline Process Capability • 266 data points collected between 11/1/04 thru 11/30/04 • Mean 29 days, St. Dev. 2.9 days, CP is 1.16 indicating process needs centering to the LSL of 10 and USL of 30 days. Cpk is .1 indicating that the process is exceeding the USL. • With an overall PPM of 371,895 defects per million opportunity, the current process has a Sigma Quality Level of 1.8 or a 62% yield Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

9. Sigma Calculator: Continuous Data Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

10. Sigma Calculator: Discrete Data Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

11. Quick Win Documentation Template • Root Cause: _________________________________________________ • Obvious Solution: __________________________________________ • Low or No Cost: __________________________________________ • Low Risk: ________________________________________________ • Implementation Plan: ______________________________________________ • Stakeholder (s) Approval: ___________________________________________ Process Name: __________________ Process Lead: ___________________ Process Owner: ______________________ Start Date: ______________ Process Area: ________________________ Stop Date: ______________ • 5s • 4-Step Setup Reduction • Inventory Reduction • MSA Improvements • Price reductions • Reduced DOWNTIME (NVA steps or work) • Pull System • Kaizen events • Other Benefits: • __________________________________________________________ • __________________________________________________________ • __________________________________________________________ Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

12. Sources of Waste Overproduction Transportation Sources of Waste • ? • ? • ? • ? • ? Defect Area 1 Area 1 Area 1 Sub area 1 Sub area 1 Sub area 1 NVA Area 1 Area 1 Area 1 Sub area 1 Sub area 1 Sub area 1 Processing Inventory Waiting Motion < Insert your waste percentage as shown in pie chart > Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

13. Swim Lane Process Map Oval shapes : Start/Stop of process Diamonds: Decision points Rectangles: process steps Half-Moon: Delay/Queue Time Notify HR of employee exit date Client Mgr Note: Steps in blue shapes are non-value added steps Form require approval? Places information into HR database Sends exit date to IT, telecom & facilities Avg. Delay 2 days Re-verifies with mgr on employee’s exit status No Client HR Yes Avg. Delay 2 days Avg. Delay 2 days Sends Email to Admin Secure approval(s) Sends Email to Admin Client Contact Admin closes ticket and manager notified Create ticket if request coming directly from client Utilize e-mail vendor’s web tool to submit delete request to vendor NT Admin Avg.Delay 1 day Generates ticket & forwards to Admin Avg. Delay 1 day Admin Avg.Delay 4 days Mark request as completed on admin web site Delete account Email Vendor Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

14. Value Stream MapCurrent State Order Mgmt Screen for Acct Mgr Order Mgmt Supervisor CUSTOMER SUPPLIERS Service lead time = 384 min Customer call time = 24 min 2-5 days Order Mgmt Order Mgmt Order Mgmt Order Mgmt DIST 4 4 4 4 10 Weekly Update Phone Call Phone Call Manual Update Automate Monitoring P/T = 3 min Lost calls=10% Volume=1200 Large Business Simplify/ Combine Improve Visibility Forecast Improvement 6 Customers Small Business Customer Info Shipping Info Product Need Pick Pack & Ship Pricing Simplify/ Mistake Proof 5 Customers 20 Orders P/T = 2 Min P/T = 2 min P/T = 120 Min P/T = 6 Min P/T = 6 Min Home Error Rate=1% Error Rate=2% Error Rate=1% Error Rate=0% Error Rate=2% Volume=800 Volume=1200 Volume=800 Volume=800 Volume=800 3 Customers 5 min 240 min 3 min 2 min 6 min 6 min 2 min 120 min Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

15. Business Impact • State financial impact of future project leverage opportunities • Separate “hard or Type 1” from “soft Type 2 or 3” dollars Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

16. Business Impact Details • Type 1: Describe the chain of causality that shows how you determined the Type 1 savings. (tell the story with cause–effect relationships, on how the proposed change should create the desired financial result (savings) in your project ) • Show thefinancial calculation savings and assumptions used. • Assumption #1 (i.e. source of data, clear Operational Definitions?) • Assumption #2 (i.e. hourly rate + incremental benefit cost + travel) • Type 2: Describe the chain of causality that shows how you determined the Type 2 savings. (tell the story with cause–effect relationships, on how the proposed change should create the desired financial result (savings) in your project ) • Showthe financial calculation savings and assumptions used. • Assumption #1 (i.e. Labor rate used, period of time, etc…) • Assumption #2 (i.e. contractor hrs or FTE, source of data, etc…) • Describe the Type 3 Business Impact(s) areas and how these were measured • Assumption #1 (i.e. project is driven by the Business strategy?) • Assumption #2 (i.e. Customer service rating, employee moral, etc…) • Other Questions • Stakeholders agree on the project’s impact and how it will be measured in financial terms? • What steps were taken to ensure the integrity & accuracy of the data? • Has the project tracking worksheet been updated? Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

17. Current Status • Key actions completed • Issues • Lessons learned • Communication, team building, organizational activities Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

18. Next Steps • Questions to answer • Barrier/risk mitigation activities • Key actions • Planned Lean Six Sigma Tool use Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

19. Sign Off • I concur that the Measure phase was successfully completed on MM/DD/YYYY • I concur the project is ready to proceed to next phase: Analyze Enter Name Here Green Belt/Black Belt Enter Name Here Deployment Champion Enter Name Here Sponsor / Process Owner Enter Name Here Financial Representative Enter Name Here Master Black Belt Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

20. Tollgate ReviewsBackup Slides Halt - Hold D M A I C Go Forward Wait - Go Back

21. MeasureTollgate Checklist Stop Tollgate Review • Has a more detailed Value Stream Map been completed to better understand the process and problem, and where in the process the root causes might reside? • Has the team conducted a value-added and cycle time analysis, identifying areas where time and resources are devoted to tasks not critical to the customer? • Has the team identified the specific input (x), process (x), and output (y) measures needing to be collected for both effectiveness and efficiency categories (i.e. Quality, Speed, and Cost measures)? • Has the team developed clear, unambiguous operational definitions for each measurement and tested them with others to ensure clarity/consistent interpretation? • Has a clear, reasonable choice been made between gathering new data or taking advantage of existing data already collected by the organization? • Has an appropriate sample size and sampling frequency been established to ensure valid representation of the process we’re measuring? • Has the measurement system been checked for repeatability and reproducibility, potentially including training of data collectors? • Has the team developed and tested data collection forms or check sheets which are easy to use and provide consistent, complete data? • Has baseline performance and process capability been established? How large is the gap between current performance and the customer (or project) requirements? • Has the team been able to identify any complete ‘Quick Wins’? • Have any Kaizen opportunities been identified to accelerate momentum and results? • Have key learning(s) to-date required any modification of the Project Charter? If so, have these changes been approved by the Project Sponsor and the Key Stakeholders? • Have any new risks to project success been identified, added to the Risk Mitigation Plan, and a mitigation strategy put in place? Key Deliverables: • Detailed Value Stream Map(s) • Data Collection Plan • Measurement Collection Results • Process Capability Results • Current Baseline Process Performance • Quick Wins, if applicable • Identification of Kaizen Opportunities, if applicable • Refined Charter, as necessary • Updated Risk Mitigation Plan • Deliverables Uploaded to Central Storage Location or Deployment Management System. Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

22. AnalyzeTollgate Checklist Stop Tollgate Review • Has the team examined the process and identified potential bottlenecks, disconnects and redundancies that could contribute to the problem statement? • Has the team analyzed data about the process and its performance to help stratify the problem, understand reasons for variation in the process, and generate hypothesis as to the root causes of the current process performance? • Has an evaluation been done to determine whether the problem can be solved without a fundamental recreation of the process? Has the decision been confirmed with the Project Sponsor? • Has the team investigated and validated (or devalidated) the root cause hypotheses generated earlier, to gain confidence that the “vital few” root causes have been uncovered? • Does the team understand why the problem (the Quality, Cycle Time or Cost Efficiency issue identified in the Problem Statement) is being seen? • Has the team been able to identify any additional ‘Quick Wins’? • Have learningsto-date required modification of the Project Charter? If so, have these changes been approved by the Project Sponsor and the Key Stakeholders? • Have any new risks to project success been identified, added to the Risk Mitigation Plan, and a mitigation strategy put in place? Deliverables: • List of Potential Root causes • Prioritized List of Validated Root Causes • Additional “Quick Wins”, if applicable • Refined Charter, as necessary • Updated Risk Mitigation Plan • Deliverables Uploaded to Central Storage Location or Deployment Management System Has the team identified the key factors (critical X’s) that have the biggest impact on process performance? Have they validated the root causes? International Standards for Lean Six Sigma 22

23. Bonacorsi Consulting

24. Bonacorsi Consulting

25. Lean Six Sigma DMAIC Improvement Process • Define the opportunity from both the customer and business perspective Define Tollgate Review • Understand the baseline process performance Stop Measure • Identify the critical X factors and root causes impacting process performance Tollgate Review Analyze Stop Tollgate Review • Develop solutions linked to critical x’s Stop Improve Tollgate Review Stop • Implement solutions & control plan Control Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

26. Attitude Charting & Key Constituency Map (Optional) “Critical mass must be won-over” Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

27. Sample Size: Continuous Data (Optional) • ? • ? • ? • ? • ? • ? • ? • ? • ? • ? Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

28. Sample Size:Discrete Data (Optional) • ? • ? • ? • ? • ? • ? • ? • ? • ? • ? Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

29. Measurement Systems Analysis (MSA) (Optional) Gage R&R %Contribution Source VarComp (of VarComp) Total Gage R&R 0.0015896 3.70 Repeatability 0.0005567 1.29 Reproducibility 0.0010330 2.40 Operator 0.0003418 0.79 Operator*Part 0.0006912 1.61 Part-To-Part 0.0414247 96.30 Total Variation 0.0430143 100.00 Study Var %Study Var Source StdDev (SD) (6 * SD) (%SV) Total Gage R&R .039870 0.23922 19.22 Repeatability 0.023594 0.14156 11.38 Reproducibility 0.032140 0.19284 15.50 Operator 0.018488 0.11093 8.91 Operator*Part 0.026290 0.15774 12.68 Part-To-Part 0.203531 1.22118 98.13 Total Variation 0.207399 1.24439 100.00 Number of Distinct Categories = 7 • Measurement system is acceptable with the Total % Contribution <10% Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

30. Probability Plot (Optional) Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

31. Control Chart(Optional) • The current baseline delivery time is stable over time with both the Moving Range (MR) (3.22 days) and Individual Average (29.13 days) experiencing common cause variation • 255 data points collected with zero subgroups, thus the I&MR control chart selected Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

32. PDCA(Optional) • Plan: • ? • ? • Do: • ? • ? • Check: • ? • ? • Act: • ? • ? ? Plan ? Do ? Check ? Act Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

33. 5s(Optional) Sort • ? • ? Set Order • ? • ? Shine • ? • ? Standardize • ? • ? Sustain • ? • ? Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

34. Benchmark Analysis(Optional) Based on the information above, what is the performance objective*? • Reduce defects by % • Reduce long-term DPMO from to . • Improve short-term Z from to . *If you do not benchmark, performance standards are based on: • For a process with  3 sigma level, decrease % defects by 10x. • For a process with > 3 sigma level, decrease % defects by 2x. • Other….please explain (corporate mandate, compliance/legal, VOC data, etc) Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

35. Key Buying Factor Analysis(Optional) Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

36. Sample Value Stream Mapping Symbols (Optional) I C/T = 36 Sec Machining Quotes Flow (Physical) Set Up Time 7 Min Queue/ Inventory Uptime 86% Electronic Information Flow (Information) Data Box Process Box 1 Physical Pull Electronic Data System Personnel “Go See” Monitoring F I F O Truck Shipment Sign Off Point FIFO Lane Physical Transport Project Burst Paper Kanban Kanban Station Supplier/ Customer Supermarket Replenishment Push Systems Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

37. Spaghetti Diagram(Optional) EAST Foyer To Office Parking Lot Order Taker 1 Order Entry 1 Reception Order Entry 2 Order Entry 3 Supply Room (paper and office supplies) Printer, Fax OM Lead CC & Val 2 Order Taker 2 Copier OM Supr Office Records Room (Order Management) CC & Val 1 CC & Val 3 Order Taker 3 Restrooms Cafeteria Vault (finance) Engineering Offices Lines indicate paper/information travel: - No set path - Lots of rework Indicates an in-box or outbox where work (forms/ information) waits to be worked on or transferred Planning & Scheduling Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma

38. AS-IS Process Mapping Symbols (Optional) Enter Key Slide Take Away (Key Point) Here International Standards for Lean Six Sigma