© QiA Inc.

Control Plans

Control Plans

Six Sigma Tools

Six Sigma Tools

Takt TimeTakt Time

5-SHabits5-S

Habits

Work Instructions

Work Instructions

KaizenTeams

KaizenTeams

Quality in Action Inc.

Lean/SigmaCombining the Speed of Lean with the Power of Sigma

Lean/SigmaCombining the Speed of Lean with the Power of Sigma

© QiA Inc.

• General Electric, one of the early leaders in Six Sigma has made statements to the effect that they will save $5 - $10 billion in cost reductions alone in their investment in Six Sigma.

• The GE annual report prominently states: “…. Our Six Sigma quality initiative is changing the way we do everything.”

• General Electric, one of the early leaders in Six Sigma has made statements to the effect that they will save $5 - $10 billion in cost reductions alone in their investment in Six Sigma.

• The GE annual report prominently states: “…. Our Six Sigma quality initiative is changing the way we do everything.”

“If we don’t change our direction, we might end up where we’re headed.”

Chinese Proverb

© QiA Inc.

LEAN Manufacturing• LEAN teaches us about:WASTE, DEMAND, FLOW, DEFECT

PREVENTION, BALANCE

• WASTE All motion is waste. A perfect system is one that is self contained. Consider: where does everything come from? Where does everything go?

– A common Waste is stock piling. Inventory must be kept to a minimum. The optimum amount of available inventory is ZERO.

Scrap is the most common type of Waste. There are several kinds: Internal, External, Direct & Indirect.

• LEAN teaches us about:WASTE, DEMAND, FLOW, DEFECT

PREVENTION, BALANCE

• WASTE All motion is waste. A perfect system is one that is self contained. Consider: where does everything come from? Where does everything go?

– A common Waste is stock piling. Inventory must be kept to a minimum. The optimum amount of available inventory is ZERO.

Scrap is the most common type of Waste. There are several kinds: Internal, External, Direct & Indirect.

© QiA Inc.

Lean continued………….• DEMAND“TAKT TIME” is the demand on

the system to support the actual market requirements. The actual market requirement is known as PULL.

One purpose of a Pull System is to shut down an operation as soon as an abnormality occurs.

One must use this calculation: Divide the available manufacturing time in a period by the ACTUAL demand during that period.

• DEMAND“TAKT TIME” is the demand on the system to support the actual market requirements. The actual market requirement is known as PULL.

One purpose of a Pull System is to shut down an operation as soon as an abnormality occurs.

One must use this calculation: Divide the available manufacturing time in a period by the ACTUAL demand during that period.

© QiA Inc.

Lean continued………….• FLOW Also known as One Piece Flow. We

don’t want to BATCH or create FAKE Flows.

• DEFECT PREVENTION The system is designed to PREVENT rather than Detect.

– JIDOKA is the Japanese word for autonomation. Tools & fixtures as well as processing operations, are designed to detect problems and shut down when they occur.

• BALANCE Means: To Balance people and automation to optimize flexibility and balance the Work Flow.

• FLOW Also known as One Piece Flow. We don’t want to BATCH or create FAKE Flows.

• DEFECT PREVENTION The system is designed to PREVENT rather than Detect.

– JIDOKA is the Japanese word for autonomation. Tools & fixtures as well as processing operations, are designed to detect problems and shut down when they occur.

• BALANCE Means: To Balance people and automation to optimize flexibility and balance the Work Flow.

© QiA Inc.

Six SigmaSix Sigma• The basic framework behind Six Sigma is: DMAIC

• DEFINE What is the Objective? Goals?

• MEASURE Where are we NOW? Look at tools like: scrap reports, flow charts, Pareto, Cause & Effect, Distributions.

• ANALYZE Where are we GOING? Use tools like: Scatter diagrams, regression analysis, FMEA (Failure Mode & Effect Analysis), Hypothesis testing.

• IMPROVE What is the best way? Tools like: DOE (Design of Experiments), Functional Testing and Production Trials are employed.

• CONTROL We need to Control through Work Instructions and Control Plans. – Gauge Control, Mistake proofing and Preventative Maintenance.

• The basic framework behind Six Sigma is: DMAIC

• DEFINE What is the Objective? Goals?

• MEASURE Where are we NOW? Look at tools like: scrap reports, flow charts, Pareto, Cause & Effect, Distributions.

• ANALYZE Where are we GOING? Use tools like: Scatter diagrams, regression analysis, FMEA (Failure Mode & Effect Analysis), Hypothesis testing.

• IMPROVE What is the best way? Tools like: DOE (Design of Experiments), Functional Testing and Production Trials are employed.

• CONTROL We need to Control through Work Instructions and Control Plans. – Gauge Control, Mistake proofing and Preventative Maintenance.

© QiA Inc.

Basic DifferencesLean Six Sigma

Short/Quick Improvement Processes

Longer Term Project Periods

“Kaizen” – Many small

improvements

Bigger Solutions

“Rocket Science?”

Process Knowledge Based

Statistical Knowledge Based

Small Teams & Individuals

Black Belts often assisted by Green Belts

© QiA Inc.

Challenges

• Can anyone be a “Lean Practitioner”?– YES in fact this is the organizational goal

of Lean – EVERYONE is responsible and practicing Lean.

– It’s intuitive– It’s habit forming– It’s quick & fast – Doesn’t need Kaizen or even teams

• BLITZ

• Can anyone be a “Lean Practitioner”?– YES in fact this is the organizational goal

of Lean – EVERYONE is responsible and practicing Lean.

– It’s intuitive– It’s habit forming– It’s quick & fast – Doesn’t need Kaizen or even teams

• BLITZ

© QiA Inc.

Challenges

• Can anyone be a “Black Belt”?– No, if the statistical side of the world is

difficult for you maybe this isn’t your place.

• Can anyone be a “Green Belt”?– Sure, virtually everyone can be trained in

the concepts.

• Do you need to be a “Belt” to do this Sigma stuff?– We say: Yes

• Can anyone be a “Black Belt”?– No, if the statistical side of the world is

difficult for you maybe this isn’t your place.

• Can anyone be a “Green Belt”?– Sure, virtually everyone can be trained in

the concepts.

• Do you need to be a “Belt” to do this Sigma stuff?– We say: Yes

© QiA Inc.

The Hard Fact:

It is far easier for a Black or Green Belt to “pick-up” Lean and effectively operate the tools than it is for a Lean Practitioner to “pick-up” Six Sigma and practice it competently.

It is far easier for a Black or Green Belt to “pick-up” Lean and effectively operate the tools than it is for a Lean Practitioner to “pick-up” Six Sigma and practice it competently.

© QiA Inc.

The Dumbing Down of Six Sigma• Don’t be fooled into believing that by

just learning a few chart methods that you are REALLY doing Six Sigma.

• Or that Lean/Sigma is somehow simpler than either practice by itself.

• The Quality Community needs to recognize these dangers that erode our very profession!

• Don’t be fooled into believing that by just learning a few chart methods that you are REALLY doing Six Sigma.

• Or that Lean/Sigma is somehow simpler than either practice by itself.

• The Quality Community needs to recognize these dangers that erode our very profession!

© QiA Inc.

Recommendations

• Certify Black Belts

• Train Black Belts in Lean– Lean Certification

• Involve Green Belts in Lean Teams along with other Lean Team members

• Follow DMAIC for all Lean Events!

• Certify Black Belts

• Train Black Belts in Lean– Lean Certification

• Involve Green Belts in Lean Teams along with other Lean Team members

• Follow DMAIC for all Lean Events!

© QiA Inc.

• Lean Seeks to Optimize processes while Sigma Reduces Variation.

• It is truly a “blend” of methodologies.

• Lean Teams utilize the DMAIC model and use the tools.

• Lean Seeks to Optimize processes while Sigma Reduces Variation.

• It is truly a “blend” of methodologies.

• Lean Teams utilize the DMAIC model and use the tools.

“Combining the speed of Lean with the Power of Sigma”

© QiA Inc.

Time Frames

• Remember the timeline differences?– Lean: 2 to 5 day events– Even Kaizen Blitz – could happen anytime.– Six Sigma: 2- ?? Months

• Remember the objective differences?– Lean / Kaizen: Many small improvements– Six Sigma: Rocket Science (at least Science)

• Remember the timeline differences?– Lean: 2 to 5 day events– Even Kaizen Blitz – could happen anytime.– Six Sigma: 2- ?? Months

• Remember the objective differences?– Lean / Kaizen: Many small improvements– Six Sigma: Rocket Science (at least Science)

© QiA Inc.

Lean/Sigma

• Lean/Sigma looks at blending time frames as well as methodologies

• Not Days

• Not Months

• Probably more like Weeks

• Lean/Sigma looks at blending time frames as well as methodologies

• Not Days

• Not Months

• Probably more like Weeks

© QiA Inc.

Lean/Sigma – a typical project• Week 1

– DEFINE the objective.– Establish the Team. 3-7 members– Set Rules.– Train. (Day 1-2)– MEASURE the current situation.

• Create Current State Value Stream Maps• Financial Reports, Exec Reports, Loss

Function• Quality Reports, Customer Complaints,

Scrap Records,

• Week 1– DEFINE the objective.– Establish the Team. 3-7 members– Set Rules.– Train. (Day 1-2)– MEASURE the current situation.

• Create Current State Value Stream Maps• Financial Reports, Exec Reports, Loss

Function• Quality Reports, Customer Complaints,

Scrap Records,

© QiA Inc.

Lean/Sigma – a typical project• Week 2

– ANALYZE the process.• Send out the Team with assignments.• Team gathers analyze information.

Tools to use:– DOE (Design of Experiments)?– t test, f test, hypothesis testing?– Tukey Quick test?– Flow, Line Balance, Point of Use?– Takt Time, Buffer Stock, Inventory

• Week 2– ANALYZE the process.

• Send out the Team with assignments.• Team gathers analyze information.

Tools to use:– DOE (Design of Experiments)?– t test, f test, hypothesis testing?– Tukey Quick test?– Flow, Line Balance, Point of Use?– Takt Time, Buffer Stock, Inventory

© QiA Inc.

Lean/Sigma – a typical project

• Week 3– Review Action Items– IMPROVE Set up new DOE?

Functional tests? Production Trials?– Apply Lean concepts: Jidoka, Balance,

5S,Heijunka, Line Balancing, Cellular Layout, Quick Changeover

– Create Future State Value Stream Map

• Week 3– Review Action Items– IMPROVE Set up new DOE?

Functional tests? Production Trials?– Apply Lean concepts: Jidoka, Balance,

5S,Heijunka, Line Balancing, Cellular Layout, Quick Changeover

– Create Future State Value Stream Map

© QiA Inc.

Lean/Sigma – a typical project

• Week 3 or 4– Team gathers DOE or test information.– CONTROL Update current plans or

create new Standard Operating Procedures• PM• Gage Control

• Team Report & Recognition • Perform Closed Loop Surveillance

• Week 3 or 4– Team gathers DOE or test information.– CONTROL Update current plans or

create new Standard Operating Procedures• PM• Gage Control

• Team Report & Recognition • Perform Closed Loop Surveillance

© QiA Inc.

Process Step 1

Process Step 2

Process Step 3

The Value Stream

© QiA Inc.

Process Step 1

Process Step 2

Process Step 3

The Value Stream

The Castle Step

© QiA Inc.

Process Step 1

Process Step 2

Process Step 3

The Value Stream

Add the process times

3 min 15 min 5 min

© QiA Inc.

Process Step 1

Process Step 2

Process Step 3

The Value Stream

Add the wait times in-between

3 min 15 min 5 min

65 min 180 min

© QiA Inc.

Process Step 1

Process Step 2

Process Step 3

The Value StreamTotal the

wait times

3 min 15 min 5 min

65 min 180 min245 min

© QiA Inc.

Process Step 1

Process Step 2

Process Step 3

The Value Stream Total the Process times

3 min 15 min 5 min

65 min 180 min245 min

23 min

© QiA Inc.

Process Step 1

Process Step 2

Process Step 3

The Value Stream Total the Entire

Process

3 min 15 min 5 min

65 min 180 min245 min

23 min+268 min

© QiA Inc.

Process Step 1

Process Step 2

Process Step 3

The Value StreamThis is Non

Value Added

3 min 15 min 5 min

65 min 180 min245 min

23 min+268 min

© QiA Inc.

Process Step 1

Process Step 2

Process Step 3

The Value StreamThis is Value Added Time

3 min 15 min 5 min

65 min 180 min245 min

23 min+268 min

© QiA Inc.

Process Step 1

Process Step 2

Process Step 3

The Value Stream

3 min 15 min 5 min

65 min 180 min245 min

23 min+268 min

23 minutes VA / 268 min total process time = 8.6% ratio

© QiA Inc.

Process Step 1

Process Step 2

Process Step 3

But wait…. There’s more

3 min 15 min 5 min

65 min 180 min245 min

23 min+268 min

© QiA Inc.

Process Step 1

Process Step 2

Process Step 3

The Rework Loop

3 min + 3 min

65 min +65 min

310 min

26 min+336 min

26 minutes VA / 310 min total process time = 7.7% ratio

180 min

15 min 5 min

© QiA Inc.

A Recent Client Says:•Each time we loop it costs us an average of $31,637 and a minimum of $860

•Our total savings in cycle time through elimination of rework loops is: 11% or $10540 per cycle!

© QiA Inc.

Lean and Lean Sigma Examples

© QiA Inc.

Transportation Study

Transportation Description (Old Process)

Old Process Time

(Seconds)

Old Process Distance

(Feet)

Transportation Description (New Process)

New Process (Seconds)

New Process Distance

(Feet)Truck to storage 65 124 Truck to storage 48 60Storage to Giben 60 193 Storage to router 15 40Giben to Edge Bander 32 118 Router to edge bander 10 15Edge Bander to P2P 17 53 Edge bander to polisher 10 15PTP to Polisher 10 15 N/APolisher to Eagle Creek 80 192 Polisher to Eagle Creek 60 60

264 695 143 190

Annual Cost Savings21,500$

Distance Savings73%

© QiA Inc.

We Found Money!

• $60,000 in unknown raw materials.

• African Mahogany

• Red & White Oak• Old Forest Eucalyptus

• $60,000 in unknown raw materials.

• African Mahogany

• Red & White Oak• Old Forest Eucalyptus

© QiA Inc.

Creating Metrics for Sustainability

© QiA Inc.

Quality Measures Comparisons

CPK Sigma Level DPM(Defects per

Million)

0.33 1.0 600,000

0.667 2.0 308,538

1.00 3.0 66,807

1.33 4.0 6,210

1.67 5.0 233

2.00 6.0 3.4

1.5 sigma shift has been applied

© QiA Inc.

Hiring Process Cycle TimeIndividuals (Xi) Chart

78.95UCL

CL 49.25

LCL 19.5519.5

29.5

39.5

49.5

59.5

69.5

79.5

89.5

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

Ela

psed

Tim

e (D

ays)

Data Points

UCL

+2 Sigma

+1 Sigma

Average

-1 Sigma

-2 Sigma

LCL

© QiA Inc.

Hiring Process Cycle TimeIndividuals (Xi) Chart

FUTURE EXAMPLE

43.06

78.95UCL

CL

26.69

49.25

LCL

10.32

19.55

9.4

19.4

29.4

39.4

49.4

59.4

69.4

79.4

89.4

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30

Ela

psed

Tim

e (D

ays)

Data Points

UCL

+2 Sigma

+1 Sigma

Average

-1 Sigma

-2 Sigma

LCLK

aize

n E

vent

Jun

e 20

06

© QiA Inc.

Account Receivables Process TimeFUTURE EXAMPLE

115.65

219.08UCL

CL

82.67

194.42

LCL

49.68

169.75

0

50

100

150

200

250

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

Hou

rs

Data Points

UCL

+2 Sigma

+1 Sigma

Average

-1 Sigma

-2 Sigma

LCL

KA

IZE

N E

VE

NT

JU

LY

- A

UG

'0

6

CURRENT STATE Est.FUTURE STATE

© QiA Inc.

• “60% to 80% of all costs related to meeting customer demand are Administrative or Non-Production Related functions.”

– Value Stream Management for the Lean Office, 2004, Don Tapping & Tom Shuker

• “60% to 80% of all costs related to meeting customer demand are Administrative or Non-Production Related functions.”

– Value Stream Management for the Lean Office, 2004, Don Tapping & Tom Shuker

© QiA Inc.

Spaghetti Diagram – Valessa C

© QiA Inc.

Spaghetti Diagram – Beth C.

© QiA Inc.

Summary –Business Kaizen Event• Paperwork Reduction

– Modified forms to reduce lead-time, increase communication with advisors.

– Consolidated several forms to eliminate redundancy. • Cycle time Reduction

– 39% reduction in through-put time.– 51 to 31 Average days

• Creation of function measurable (Cycle Time Chart)• Point Kaizens

– 17 opportunities• New Event – Orientation Kaizen• 30 – 60 day follow through list.

• Paperwork Reduction– Modified forms to reduce lead-time, increase

communication with advisors.– Consolidated several forms to eliminate redundancy.

• Cycle time Reduction– 39% reduction in through-put time.– 51 to 31 Average days

• Creation of function measurable (Cycle Time Chart)• Point Kaizens

– 17 opportunities• New Event – Orientation Kaizen• 30 – 60 day follow through list.

© QiA Inc.

Unusual Events

© QiA Inc.

Current Process• We have two processes

– The external vendor lumber process– The (internal) Lumber process

• We have two processes– The external vendor lumber process– The (internal) Lumber process

© QiA Inc.

© QiA Inc.

Distribution & Stores

Distribution

Store

Store

Store

Store

Store

Vendor

Vendor

Vendor

Vendor

Vendor

Vendor

Vendor

© QiA Inc.

Future ProcessThe Future Process centralizes the purchasing

function and involves new partners: 1. Lumber Category Manager 2. Purchasing

The Future Process centralizes the purchasing function and involves new partners: 1. Lumber Category Manager 2. Purchasing

© QiA Inc.

Vendors

Merchandising(Cat Managers)

Events & Programs

Vendor Program ProcessRev A

Co-op(GateKeeper)

Accounting

Purchasing

Marketing/Creative

Financial Planning

CURRENT PROCESS (sometimes)

VendorsSALES

BILLING

PROOF of PERFORMANCE

PROMOVehicles

AGREEMENTS

SCORECARD

DATA

INTERNETSALES

Transportation

DATA

PROOF of PERFORMANCE

© QiA Inc.

Vendors

Merchandising(Cat Managers)

Vendor Program ProcessRev C

Financial Planning

CURRENT PROCESS (sometimes)

Vendors

SALES

BILLING

PROMOVehicles

AGREEMENTS

SCORECARD(Future)

DATA

Transportation(Future)

DA

TA

Program & Promo Claims

Database

Co-op

MarketingAssistant

Accounting

Purchasing

Retail

Marketing

Internet

Creative

CURRENT PROCESS (sometimes)

© QiA Inc.

$$$ “What If’s?” Current Vendors Terms Discount Average @ 1.5 % $368,901

Current Vendors Terms Discount Average @ 2.0 % $491,868

Remaining Vendors Terms Discount Potential @ 1.0% $214,027(Additional $$ to bottom line)

Remaining Vendors Terms Discount Potential @ 1.5% $321,041(Additional $$ to bottom line)

Remaining Vendors Terms Discount Potential @ 2.0% $428,055(Additional $$ to bottom line)

© QiA Inc.

Injection

M

oldin

g

Move

Lean/Sigma

Combo event

DEFECT

DEFECT

© QiA Inc.

Injection

M

oldin

g

Jidoka Autonomation

Autonomation transfers a level of human intelligence to automated machinery. Machines detect a single

defective part and immediately stop while

asking for help. 

U-S

hap

ed C

ell

Feedback loop

© QiA Inc.

Injection

M

oldin

g

Jidoka Autonomation

U-S

hap

ed C

ell

Six Sigma ProjectReducing Variation

thru DOE

© QiA Inc.

Injection

M

oldin

g

Jidoka Autonomation

U-S

hap

ed C

ell

Lean Kaizen EventCellular Production

& Jidoka

© QiA Inc.

This project was the result of Lean/Sigma thinking. A robot-camera system added to an injection molding press resulted in documented 6 sigma quality, less than 3.4 defects per million.

© QiA Inc.

Lean/SigmaCombining the Speed of Lean with the Power of Sigma

Lean/SigmaCombining the Speed of Lean with the Power of Sigma