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Section II: Six Sigma Goals

Section II: Six Sigma Goals. What are Black Belts?. Black Belts are individuals that are trained in the application of Six Sigma philosophy. Black Belts typically receive 160 hours of training and work full-time on projects.

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Section II: Six Sigma Goals

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  1. Section II: Six Sigma Goals

  2. What are Black Belts? • Black Belts are individuals that are trained in the application of Six Sigma philosophy. Black Belts typically receive 160 hours of training and work full-time on projects. • They are change agents, and by working with the employees, will increase knowledge through the acquisition of data. • Working together will make this philosophy part of the company culture in all aspects of the business. II-1

  3. What are Green Belts? • Green Belts are individuals that may come from various backgrounds in any functional area. (manufacturing or transactional/office) • They are respected by their peers and are proficient in basic and advanced process improvement tools. • Green Belts assist the Black Belts, leads process improvement teams within their own natural work team, trains and coaches on tools and analysis, is typically part-time on a project, and may lead groups or organization where multiple projects are being worked. II-1

  4. The Six Sigma Infrastructure II-1

  5. What is Six Sigma? Metric based on standard deviation s 3 Process Centered • Process is slightly Lower Upper WIDER than the Specification Specification specifications, s 3 Process Limit Limit Six Sigma is MUCH more than this! causing waste and cost of poor quality Determined by Determined by the customer the customer s s s s s s s s s s s s s 0 - - 6 6 - 5 - 4 - 3 - 2 - 1 +4 +5 +1 +2 +3 +6 WASTE WASTE s 6 Process s 6 Process Centered • Process FITS well within the specifications, so even if the process shifts, the values fall well within tolerances s s s s s s s s s s s s +1 - 1 +2 +3 +6 - 6 - 5 - 4 - 3 - 2 +4 +5 0 II-3

  6. What is Six Sigma? L o w e r S p e c U p p e r S p e c • A statistical number • 3.4 parts per million defective (+/- six standard deviations with mean shift of +/-1.5s) • A proven, powerful five-step methodology for improving any process • Define - Measure - Analyze - Improve - Control • Tools are nothing new, but extremely powerful when executed in strict sequence • A culture, a mindset • the relentless pursuit andelimination of variation • A business methodology 0 . 0 8 0 . 0 9 0 . 1 0 0 . 1 1 0 . 1 2 0 . 1 3 0 . 1 4 0 . 1 5 Sigma Defects 2 308,537 3 66,807 4 6,210 5 233 6 3.4 A Six Sigma business lives these concepts in everything they do. II-3

  7. What Six Sigma is and is not 6s is: • a comprehensive business methodology for achieving breakthrough improvement in performance by linking metrics and goals to innovation 6s is not: • a quality initiative from the quality department The elevator speech: Six Sigma is the relentless pursuit of variation reduction in all business processes. II-3

  8. Aggressive goals II-3

  9. Benchmarking II-3

  10. DMAIC Characterize Analyze • Define • Describe in detail the process/product you are trying to improve? • Measure • Baseline • Analyze • Identify the Critical Few • Improve • Reduce Variation • Error Proofing • Control • Control input • Control Plan Define Measure Improve Control Optimize See Quality Digest Article (MAIC_Introvert/Extrovert) II-4

  11. “14 Questions” • What are my processes? (SIPOC) • What is the capability (sigma level) / defect levels (PPM) of my processes? (Defect sheets, histograms, run charts) • Which processes have the highest defect levels? (Pareto analysis) • Who would I need on my team to eliminate the defects? (Team building) • What is causing the variation / defects? (Cause and effect diagrams; “Fishbone”) • Is my gaging at fault? (Gage R&R studies) • Are all of the steps necessary in my process? (Process mapping) • Which steps can be removed to reduce cycle time, eliminate waste? (Work simplification / Waste elimination) • Are there set-up reduction opportunities? (SMED analysis) • How can I prevent this problem from reoccurring? (Error proofing, poka-yoke) • Are there simple visual aids that could help reduce defects? (Visual controls) • Are there designed experiments that could shed some light on the situation? (DOE) • Do I have the right tools available to do the job? Are tools organized in a neat and orderly manner in the work area? Is everything clearly labeled? (5S and ergonomics) • Can this problem be solved quickly, or is an in-depth investigation using a Black Belt or Kaizen event necessary? (Six Sigma project / Kaizen event identification) These 14 knowledge questions will lead you through the DMAIC steps II-4

  12. Why do we need Six Sigma? Total Product or Service Price to Customers Budget Constraints and Competition Drive a Lowered Price Profit Profit Total Cost to Produce or Provide Waste (COPQ) Profit Profit Price $ COPQ Theoretical Costs i.e.., Cost of Doing the Right Things Right the First Time Waste (COPQ) Theoretical COSTS Theoretical COSTS 0 a. b. c. d. e. “The price of gaining knowledge is nothing compared to the cost of ignorance.” Anonymous II-4

  13. Why “Six” Sigma? There is a correlation between a company’s Cost of Quality and the s rating of its key processes. II-4

  14. Why Six Sigma cont.... Traditional Quality Costs Inspection, Warranty, Scrap, Rework, Rejects Tangible...easy to measure! 4X : 6X Additional COPQ More setups, Expediting Costs, Lost Sales, Late Delivery, etc... Intangible...difficult or impossible to measure! If Company Sales = $300M Traditional Costs = 4 - 6% of Sales = $15M Additional COPQ = 25 - 35% of Sales! = $90M II-4

  15. Lessons Learned • Must have management support and understand COPQ • Must see ROI and customer satisfaction increase • Don’t give up – no turning back • NEVER remove anyone from the company because of process improvement • Rigorous Black/Green Belt selection process • Six Sigma implementation should follow the DMAIC cycle • Must have management support and understand COPQ II-6

  16. In Summary, Six Sigma... • Provides common measurement and common goals • Promotes team work • Fixes quality problems • Beats the competition • Runs our whole business more effectively • Puts more money on our bottom line • Promotes prevention rather than detection • Focus should be on: • Quality • Delivery • Responsiveness • Cost II-6

  17. Cost of Poor Quality (COPQ) See V-59 • COPQ is defined as costs associated with using / maintaining business processes that produce services or products of inferior quality. There are four recognized categories: • Prevention costs: costs related to avoiding costs in three areas listed below, as well as avoiding general quality failures. • Appraisal costs: assessing sufficient conformance to quality requirements • Internal failure costs: finding/correcting defects prior to delivery to the customer • External failure costs: delivering inferior services or products to the customer II-29

  18. Cost of Quality Examples See V-59-61 Preventative Costs: • Training • Quality Planning • Design Review • Quality system audits • Continuous improvement • Technical data review • Process validation • Marketing research • Customer surveys • Field trials • Supplier quality planning • SPC • Process Control Appraisal Costs: • Receiving/Incoming Inspection and Test • Measurement Equipment • Qualification of Supplier Product • Source Inspection and Control Programs • Planned Inspections, Tests • Product or Service Quality Audits • Review of Test and Inspection data • Set-up Inspections and Tests • Depreciation Allowances • Measurement Equipment Expense • Special Product Evaluations • Evaluations of Field Stock and Spare Parts • Process Control Measurement II-29

  19. Typical response to process problems… • Blame and train • Try to widen tolerances • Add inspection operations • Which do you think will be effective? II-29

  20. Inspection and Six Sigma Four fully armored aircraft carriers launched fifteen flights of fighter planes on a daily basis. In each flight of planes, there were four F-15's, five F-14's, and a few support aircraft. For three hours the planes flew, finding target after target to attack, with few enemy fighters to bother them. Finally, after the mission was over, they did a flyby at the airfield, to show their friends how well they had fared. Their mission had been very successful. How many F’s do YOU see? II-29

  21. Reliability on visual inspection methods? 1. How many F's did you find in the story after reading it only once? _______ 2. How many F's did you find in the story after reading it through the second time? _______ 3. What was your range from your first to second reading? _______ 4. How is this similar to common inspection systems? ________________________________________________________________________________________________________________________________ 5. What is the most cost-effective way to prevent non-conformances from passing through the system? ________________________________________________________________________________________________________________________________ II-29

  22. How Many F’s? • There were 29 F’s • How many did you find? • Do you still think inspection is the answer? I cdnuoltblveieetaht I cluodaulacltyuesdnatnrdwaht I was rdgnieg  THE PAOMNNEHAL PWEOR OF THE HMUAN MNID. Aoccdrnig to rscheearch atCmabrigdeUinervtisy, it deosn'tmttaer in wahtoredr the ltteers in a word are, the olnyiprmoatnttihng is taht the frist and lsatltteer be in the rghitpclae. The rset can be a taotlmses and you can sitllraed it wouthit a porbelm. Tihs is bcuseae the huamnmniddeos not raederveylteter byistlef, but the wrod as a wlohe. Amzanig huh? Visual inspection only catches 85% of the errors* II-29

  23. The Boeing Company D1-9000 Long-Range Mission To be the number one aerospace company in the world and among the premier industrial concerns in terms of quality, profitability, and growth. Objectives To fulfill the Boeing mission, the following objectives will guide company actions. Continuous improvement in quality of products and processes A highly skilled and motivated workforce Capable and focused management Commitment to integrity Technical excellence Financial strength Introduction Continuous improvement in quality of products and processes Our commitment to steady, long-term improvement in our products and processes is the cornerstone of our business strategy. To achieve this objective, we must work to continuously improve the overall efficiency and productivity of our design, manufacturing, administrative and support organizations. The ability of Boeing to successfully accomplish its mission is dependent upon the quality of hardware provided by our suppliers. The primary purpose of this document is to establish The Boeing Company’s quality requirements for its suppliers. The focus is on defect prevention rather than defect detection! Use of statistical methods described in this document enables suppliers to reduce variation in their processes in order to prevent defects. This variation reduction will provide direct benefits to both Boeing and the supplier. II-29

  24. The Quality Tradeoff 1. Where do we spend most of our money? ________________________________________________________________________________________________________________________________ 2. How can the small moneybag on the left balance the large moneybag on the right? ________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________ II-29

  25. The Cost of Poor QualityFailure Costs Examples: • Scrap • Rework • Customer Complaint Investigation • Returned Goods • Retrofit Costs • Recall Costs • Warranty Claims • Liability Costs • Penalties • Customer/User Goodwill • Other Failure Costs II-29

  26. Why do we need metrics? • Perception and intuition are not always reality • To gather the facts for good decision making • Paradigms can limit our thought process • To identify/verify problem areas/bottlenecks • To understand our processes better (which factors are important, which are not) • To characterize our processes (to know how inputs and outputs are related) II-30

  27. Why do we need metrics? (cont..) • To validate our processes (are they performing within requirements/specs) • To evaluate customer satisfaction • To document our processes and communicate about them • To baseline a process • To see if our processes are improving • To determine if a process is stable or predictable and how much variation is inherent in the process II-30

  28. Why are Business Processes Difficult to Measure? • Business functions are rarely well defined nor managed as production processes • Measurements are typically non-existent • Traditional cost accounting systems don’t capture true costs of business processes • Many business processes are not tied to strategic objectives of the organization • They are complex and cross functional in nature -Quoted from “Six Sigma on Business Processes: Common Organizational Issue”s, Six Sigma Associates II-30

  29. The Main Idea: Y = f(x) Y is the dependent output variable of a process. It is used to monitor a process to see if it is out of control, or if symptoms are developing within a process. It is a function of the Xs that contribute to the process. Once quantified through Design of Experiment, a transfer function Y=f(X) can be developed to define the relationship of elements and help control a process.Y is the output measure, such as process cycle time or customer satisfaction. f(x) is the transfer function, which explains the transformation of the inputs into the output. xis any process input process step that is involved in producing the output. II-30

  30. A Short Story…. “A manager of a large agricultural collective in the former Soviet Union three years in a row won the prize for the most productive collective. The performance measure used was the number of kilos of meat produced per year. The fourth year, he shot himself. He had no breeding stock left. II-30

  31. A Traditional View Market Share Output Variables Sales Growth • Profitability Manage the outputs. II-30

  32. A Non-traditional View Product Quality • Input Variables COPQ Service On-Time Delivery Credit Terms Customer Training Customer Satisfaction Market Share Output Variables Sales Growth • Profitability Manage the inputs - respond to the outputs. II-30

  33. Yield See V-18 • The percentage of parts from a process that are free of defects. • It is also defined as the percentage of met commitments (total of defect free events) over the total number of opportunities. II-35

  34. Example: Time frame: 4 weeks Quantity launched: 100 parts in one-piece flow Process: 2 processes including 3 operations (A-B-C) Process 1 Operation A Yield: 100 % Operation B Yield: 100% Operation C Yield: 100% Process 2 Operation A Yield: 90 % Operation B Yield: 90% Operation C Yield: 90% II-35

  35. A B C Y = 90% Y = 90% Y = 90% Rolled Throughput Yield Process 1 A B C PARTS IN PARTS OUT 100 100 100 100 Y = 100% Y = 100% Y = 100% THE TOTAL PROCESS YIELD= 1*1*1= 1 or 100% Process 2 PARTS IN PARTS OUT 100 90 81 73 THE TOTAL PROCESS YIELD= 0.9*0.9*0.9= 0.73 or 73% II-35

  36. Exercise: FPY / RTY • Each team will be handed 20 cards. • Each team will have three operators, each of whom will drop one card at a time onto a target area. • The method of drop will be to hold the card straight out at arms length (while standing upright) over the target area or not. Only those cards that fall completely within the target area may move on. • The goal is to deliver 20 completed products or units to the customer. • Metrics- • # of good units per station (A) • # of cards used per station (B) • Total time of exercise (C) • Total # of defects (D) Start Station 1 Station 2 Station 3 Customer II-35

  37. Exercise cont… A = # of good units B = # of cards A1= B1= A2= B2= A3= B3= FPY: Y1 = A1/B1 = Y2 = A2/B2 = Y3 = A3/B3 = RTY = Y1 * Y2 * Y3 Total Cost = ($10 * D) + ($2 *[B1+B2+B3])= Average cost per unit = Total cost / 20 = Average cycle time = C / 20 = II-35

  38. a.k.a. LeanSigma RTY chart II-35

  39. The idea of capability: What’s the probability of a bent fender? II-35

  40. The idea of control: What’s the probability of a bent fender…if the driver is not in control? II-35

  41. In Control Special causes are eliminated Time Out of Control Special causes are present Size Process Control Definition of a Special Cause: A quality failure outside of the normal process that is unpredictable, intermittent or unstable. II-35

  42. Time Process Capability In Control and Capable Variation from common causes are reduced Lower Specification limit Upper Specification limit Definition of a Common Cause: A quality failure that is always present as part of the random variation in the normal process. In Control but not capable Variation from common causes are excessive Size II-35

  43. Variability T LSL USL LSL T USL 50% Reduce Process Variation to Improve Process Capability 6s = only using half the tolerance II-35

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