Table of Contents. Glossary. Copyright OpenSourceSixSigma.com. OSSS LSS Yellow Belt Manual

Transcription

1 Table of Contents Page Define Phase Understanding Six Sigma Selecting Projects Elements of Waste Wrap Up and Action Items. 77 Measure Phase Welcome to Measure Process Discovery 86 Six Sigma Statistics Measurement System Analysis Process Capability.200 Wrap Up and Action Items.221 Control Phase Welcome to Control 227 Lean Controls 230 Defect Controls. 245 Statistical Process Control.257 Wrap Up and Action Items. 297 Glossary

2 1 Lean Six Sigma ellow Belt Training Define Phase ow we will continue in the Define Phase with the. The output of the Define Phase is a well developed and articulated project. It has been correctly stated that 50% of the success of a project is dependent on how well the effort has been defined. There s that =f(x) thinking again.

3 2 Overview The core fundamentals of this phase are Process Maps, Voice of the Customer, Cost of Poor Quality and Process Metrics. We will examine the meaning of each of these and show you how to apply them. Understanding Six Sigma Process Maps Voice of the Customer Cost of Poor Quality Process Metrics Selecting Projects Elements of Waste Wrap Up & Action Items What is a Process? Why have a process focus? So we can understand how and why work gets done To characterize customer & supplier relationships To manage for maximum customer satisfaction while utilizing minimum resources To see the process from start to finish as it is currently being performed Blame the process, not the people proc ess (pros es) n. A repetitive and systematic series of steps or activities where inputs are modified to achieve a value-added output What is a Process? Many people do or conduct a process everyday but do you really think of it as a process? Our definition of a process is a repetitive and systematic series of steps or activities where inputs are modified to achieve a value-added output. Usually a successful process needs to be well defined and developed.

4 3 Examples of Processes We go thru processes everyday. Below are some examples of processes. Can you think of other processes within your daily environment? Injection molding Recruiting staff Decanting solutions Processing invoices Filling vial/bottles Conducting research Crushing ore Opening accounts Refining oil Reconciling accounts Turning screws Filling out a timesheet Building custom homes Distributing mail Paving roads Backing up files Changing a tire Issuing purchase orders Process Maps Process Mapping, also called flowcharting, is a technique to visualize the tasks, activities and steps necessary to produce a product or a service. The preferred method for describing a process is to identify it with a generic name, show the workflow with a Process Map and describe its purpose with an operational description. Remember that a process is a blending of inputs to produce some desired output. The intent of each task, activity and step is to add value, as perceived by the customer, to the product or service we are producing. ou cannot discover if this is the case until you have adequately mapped the process. The purpose of Process Maps is to: Identify the complexity of the process Communicate the focus of problem solving Process Maps are living documents and must be changed as the process is changed They represent what is currently happening, not what you think is happening. They should be created by the people who are closest to the process Process Map Start Step A Step B Step C Step D Inspect Finish There are many reasons for creating a Process Map: - It helps all process members understand their part in the process and how their process fits into the bigger picture. - It describes how activities are performed and how the work effort flows, it is a visual way of standing above the process and watching how work is done. In fact, Process Maps can be easily uploaded into model and simulation software allowing you to simulate the process and visually see how it works. - It can be used as an aid in training new people. - It will show you where you can take measurements that will help you to run the process better. - It will help you understand where problems occur and what some of the causes may be. - It leverages other analytical tools by providing a source of data and inputs into these tools. - It identifies many important characteristics you will need as you strive to make improvements. The individual processes are linked together to see the total effort and flow for meeting business and customer needs. In order to improve or to correctly manage a process, you must be able to describe it in a way that can be easily understood. Process Mapping is the most important and powerful tool you will use to improve the effectiveness and efficiency of a process.

5 4 Process Map Symbols Standard symbols for process mapping (available in Microsoft Office, Visio, igrafx, SigmaFlow and other products): A RECTAGLE indicates an activity. Statements within the rectangle should begin with a verb A DIAMOD signifies a decision point. Only two paths emerge from a decision point: o and es A PARALLELAGRAM shows that there are data An ELLIPSE shows the start and end of the process An ARROW shows the connection and direction of flow 1 A CIRCLE WITH A LETTER OR UMBER ISIDE symbolizes the continuation of a flowchart to another page There may be several interpretations of some of the process mapping symbols; however, just about everyone uses these primary symbols to document processes. As you become more practiced you will find additional symbols useful, i.e. reports, data storage etc. For now we will start with just these symbols. High Level Process Map At a minimum a high level Process Map must include; start and stop points, all process steps, all decision points and directional flow. Also be sure to include Value Categories such as Value Added (Customer Focus) and Value Enabling (External Stakeholder focus). One of the deliverables from the Define Phase is a high level process map, at a minimum it must include: Start and stop points All process steps All decision points Directional flow Value categories as defined below Value Added: Physically transforms the thing going through the process Must be done right the first time Meaningful from the customer s perspective (is the customer willing to pay for it?) Value Enabling: Satisfies requirements of non-paying external stakeholders (government regulations) on-value Added Everything else

6 5 Process Map Example D START LOGO TO PC & APPLICATIOS SCHEDULED PHOE TIME? Z A LOGO TO PHOE PHOE TIME WALK-I CALL or WALK-I? Z CALL PHOE DATA CAPTURE BEGIS C B REVIEW CASE TOOL HISTOR & TAKE OTES TRASFER APPROPRIATE? IMMEDIATE RESPOSE AVAILABLE? PUT O HOLD, REFER TO REFERECES TRASFER CALL PROVIDE RESPOSE PHOE& OTE DATA EDS D Z LOGOFF PHOE, CHECK MAIL, ,VOICE MAIL E SCHEDULED PHOE TIME? EXAMIE EXT OTE OR RESEARCH ITEM ACCESS CASE TOOL ETER APPROPRIATE SSA (#,9s,0s) IF EMP DATA OT POPULATED, ETER A F Call Center Process Map DETERMIE WHO IS IQUIRIG ASWER? OLD CASE CREATE A CASE ICL CASE TPE DATE/TIME, & EEDED B ACCESS CASE TOOL QUER ITERAL HRSC SME(S) UPDATE ETRIES ICL OPE DATE/TIME AUTO ROUTE ROUTE DETERMIE ATURE OF CALL & COFIRM UDERSTADIG CASE TOOL RECORD? B C ASWER? OFF HOLD AD ARRAGE CALL BACK PHOE DATA EDS ADD TO RESEARCH LIST CASE CLOSED TAKE ACTIO or DO RESEARCH CLOSE CASE W/ DATE/TIME GO TO F or E DEPEDIG O CASE E EXT E F Cross Functional Process Map When multiple departments or functional groups are involved in a complex process it is often useful to use cross functional Process Maps. Draw in either vertical or horizontal swim lanes and label the functional groups and draw the Process Map These are best used in transactional processes or where the process involves several departments. The lines drawn horizontally across the map represent different departments in the company and are usually Vendor Department Bank Financial Accounting General Accounting Start Request transfer Produce an Invoice Sending Fund Transfers Attach ACH form to Invoice Vendor info in FRS? ACH Automated Clearing House. o es Fill out ACH enrollment form Input info into web interface Accepts transactions, transfer money, and provide batch total Receive payment Review and Process transfer in FRS Match against bank batch and daily cash batch 3.0 Journey Entry End Maintain database to balance ACH transfers 21.0 Bank Reconciliation referred to as Swim Lanes. By mapping in this manner one can see how the various departments are interdependent in this process.

7 6 Process Map Exercise Exercise objective: Using your favorite process mapping tool create a process map of your project or functional area. 1. Create a high level process map, use enough detail to make it useful. It is helpful to use rectangular post-it s for process steps and square ones turned to a diamond for decision points. 2. Color code the value added (green) and non-value added (red) steps. 3. Be prepared to discuss this with your mentor

8 7 Do you know your Customer? Knowing your customer is more than just a handshake. It is necessary to clearly understand their needs. In Six Sigma we call this understanding the CTQ s or critical to customer characteristics. Voice Of the Customer Critical to Customer Characteristics An important element of Six Sigma is understanding your customer. This is called VOC or Voice of the Customer. By doing this allows you to find all of the necessary information that is relevant between your product/process and customer, better known as CTQ s (Critical to Quality). The CTQ s are the customer requirements for satisfaction with your product or service. Voice of the Customer Do you feel confident that you know what your customer wants? There of four steps that can help you in understanding your customer. These steps focus on the customer s perspective of features, your company s integrity, delivery mechanisms and perceived value versus cost. Voice of the Customer or VOC seems obvious; after all, we all know what the customer wants. Or do we?? The customer s perspective has to be foremost in the mind of the Six Sigma Belt throughout the project cycle. 1. Features Does the process provide what the customers expect and need? How do you know? 2. Integrity Is the relationship with the customer centered on trust? How do you know? 3. Delivery Does the process meet the customer s time frame? How do you know? 4. Expense Does the customer perceive value for cost? How do you know?

9 8 What is a Customer? Every process has a deliverable. The person or entity who receives this deliverable is a customer. There are two different types of customers; External and Internal. People generally forget about the Internal customer and they are just as important as the customers who are buying your product. There are different types of customers which dictates how we interact with them in the process, in order to identify customer and supplier requirements we must first define who the customers are: External Direct: those who receive the output of your services, they generally are the source of your revenue Indirect: those who do not receive or pay for the output of your services but have a vested interest in what you do (government agencies) Internal - those within your organization who receive the output of your work Value Chain The relationship from one process to the next in an organization creates a value chain of suppliers and receivers of process outputs. Each process has a contribution and accountability to the next to satisfy the external customer. External customers needs and requirements are best met when all process owners work cooperatively in the value chain. Careful each move has many impacts! The disconnect from Design and Production in some organizations is a good example. If Production is not fed the proper information from Design how can Production properly build a product? Every activity (process) must be linked to move from raw materials to a finished product on a store shelf.

10 9 What is a CTQ? Critical to Quality (CTQ s) are measures that we use to capture VOC properly. (also referred to in some literature as CTC s critical to customer) CTQ s can be vague and difficult to define. The customer may identify a requirement that is difficult to measure directly so it will be necessary to break down what is meant by the customer into identifiable and measurable terms Product: Service: Performance Competence Features Reliability Conformance Accuracy Timeliness Timeliness Reliability Responsiveness Serviceability Access Durability Courtesy Aesthetics Communication Reputation Credibility Completeness Security Understanding Example: Making an Online Purchase Reliability Correct amount of money is taken from account Responsiveness How long to you wait for product after the Merchant receives there money Security is your sensitive banking information stored in secure place Developing CTQ s The steps in developing CTQ s are identifying the customer, capturing the Voice of the Customer and finally validating the CTQ s. Step 1 Identify Customers Listing Segmentation Prioritization Step 2 Validate CTQ s Translate VOC to CTQ s Prioritize the CTQ s Set Specified Requirements Confirm CTQ s with customer Step 3 Capture VOC Review existing performance Determine gaps in what you need to know Select tools that provide data on gaps Collect data on the gaps

11 10 Cost of Poor Quality (COPQ) Another important tool from this phase is COPQ, Cost of Poor Quality. COPQ represents the financial opportunity of your team s improvement efforts. Those opportunities are tied to either hard or soft savings. COPQ, is a symptom measured in loss of profit (financial quantification) that results from errors (defects) and other inefficiencies in our processes. This is what we are seeking to eliminate! COPQ stands for Cost of Poor Quality As a Six Sigma Belt, one of your tasks will be to estimate COPQ for your process Through your process exploration and project definition work you will develop a refined estimate of the COPQ in your project This project COPQ represents the financial opportunity of your team s improvement effort (VOB) Calculating COPQ is iterative and will change as you learn more about the process o, not that kind of cop queue! ou will use the concept of COPQ to quantify the benefits of an improvement effort and also to determine where you might want to investigate improvement opportunities. The Essence of COPQ COPQ helps us understand the financial impact of problems created by defects. COPQ is a symptom, not a defect Projects fix defects with the intent of improving symptoms. The concepts of traditional Quality Cost are the foundation for COPQ. External, Internal, Prevention, Appraisal A significant portion of COPQ from any defect comes from effects that are difficult to quantify and must be estimated. There are four elements that make up COPQ; External Costs, Internal Costs, Prevention Costs and Appraisal Costs. Internal Costs are opportunities of error found in a process that is within your organization. Whereas, External Costs are costs associated to the finish product associated with the internal and external customer. Prevention Costs are typically cost associated to product quality, this is viewed as an investment that companies make to ensure product quality. The final element is Appraisal costs, these are tied to product inspection and auditing. This idea was of COPQ was defined by Joseph Juran and is a great point of reference to gain a further understanding. Over time and with Six Sigma, COPQ has migrated towards the reduction of waste. Waste is a better term, because it includes poor quality and all other costs that are not integral to the product or service your company provides. Waste does not add value in the eyes of customers, employees or investors.

12 11 COPQ - Categories Internal COPQ Quality Control Department Inspection Quarantined Inventory Etc Warranty Customer Complaint Related Travel Customer Charge Back Costs Etc Prevention Error Proofing Devices Supplier Certification Design for Six Sigma Etc Detection Supplier Audits Sorting Incoming Parts Repaired Material Etc COPQ - Iceberg Generally speaking COPQ can be classified as tangible (easy to see) and intangible (hard to see). Visually you can think of COPQ as an iceberg. Most of the iceberg is below the water where you cannot see it. Rework Engineering change orders Lost sales Time value of money More Set-ups Inspection Warranty Recode Rejects (less obvious) Visible Costs Late delivery Expediting costs Excess inventory Similarly the tangible quality costs are costs the organization is rather conscious of, may be measuring Working Capital allocations Hidden Costs Lost Customer Loyalty Excessive Material Orders/Planning Long cycle times already or could easily be measured. The COPQ metric is reported as a percent of sales revenue. For example tangible costs like inspection, rework, warranty, etc can cost an organization in the range of 4 percent to 10 percent of every sales dollar it receives. If a company makes a billion dollars in revenue, this means there are tangible wastes between 40 and 100 million dollars. Even worse are the intangible Costs of Poor Quality. These are typically 20 to 35% of sales. If you average the intangible and tangible costs together, it is not uncommon for a company to be spending 25% of their revenue on COPQ or waste.

13 12 COPQ and Lean Waste does not add, subtract or otherwise modify the throughput in a way that is perceived by the customer to add value. In some cases, waste may be necessary, but should be recognized and explored: Inspection, Correction, Waiting in suspense Decision diamonds, by definition, are non-value added Often, waste can provide opportunities for additional defects to occur. We will discuss Lean in more detail later this week. Lean Enterprise Seven Elements of Waste * u Correction u Processing u Conveyance u Motion u Waiting u Overproduction u Inventory Implementing Lean fundamentals can also help identify areas of COPQ. Lean will be discussed later. COPQ and Lean While hard savings are always more desirable because they are easier to quantify, it is also necessary to think about soft savings. COPQ Hard Savings Labor Savings Cycle Time Improvements Scrap Reductions Hidden Factory Costs Inventory Carrying Cost COPQ Soft Savings Gaining Lost Sales Missed Opportunities Customer Loyalty Strategic Savings Preventing Regulatory Fines Here are examples are COPQ s Hard and Soft Savings.

14 13 COPQ Exercise Exercise objective: Identify current COPQ opportunities in your direct area. 1. Brainstorm a list of COPQ opportunities. 2. Categorize the top 3 sources of COPQ for the four classifications: Internal External Prevention Detection otes