Utilization of Six-Sigma Methodology for Lean Operating System Monitoring In

Utilization of Six-Sigma Methodology for Lean Operating System Monitoring In Product Development Area Cristiano Marques de Oliveira Delphi Automotive Systems Packard Electrical / Electronic Architecture Division

Lean Implementation Challenge Expand the use of Lean Manufacturing concepts to Product Development related areas o Improve processes flow and connectivity Eliminate the seven types of waste on product development process o Correction o Overproduction o Movement of Information o Motion o Waiting o Inventory o Processing The complexity of the waste identification task can increase when the product development process is considered! 2

Lean Operating System Elements Process map with the connections between areas Performance metrics (Quality Volume Cost) Q: with quality V: on time C: at cost OK? OK? OK? Start Quality Volume Cost Return Visual management panel Activities scheduling system 3

No Defects Culture Culture Highlights Don't pass defects for the next step, including missing information. Stop Culture Do not start the next process if there are missing inputs, run risk assessments, evaluate and determine whether you can proceed. Fix Quick Culture Immediate feedback and resolution of the source of QVC issues. Visual Culture Uses simple visual controls for managing processes. QVC Ownership Culture All employees should be devoted to achieving the goals of QVC as well as the cost templates. 4

Why Use Six-Sigma Method? Standardize monitoring and avoid functional areas duplicate efforts for: Metrics collection and method definition. Visual management panel compilation. Define Measure Control Analyze Improve 5

DEFINE Understand the monitoring process including collecting QVC metrics and visual management panel creation Tools used: High level process map (SIPOC) Supplier Inputs Process Outputs Customer Requirements Requirements Operating System Implementation Team Functional Area Leadership Product & Process Development Flow Lean Definitions Strategic Plan With connection between areas With inputs and outputs per pipe With QVC strategy With definition for visual management panel With management routines frequency With scheduling details With implementation lead-times With names of area representatives With QVC metrics implementation goal Product Development QVC map Collect and compile QVC metrics and update the Visual Management Panel Visual Management Panel available with QVC data QVC metrics installed Visual Management Panel available Scheduling System in place With collect plan defined With owners names With updated data With defined updated frequency With charts per functional area With each activity due date With owner name With project name With read access to activity owners Functional Area Program Managers and activities owners 6

MEASURE Measure the gap to meet the QVC metrics implementation goal (strategic plan) for the product development process. Tools used: Bar chart Initial Situation 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 25 39 7 10 7 3 NOK OK Type OK NOK Q 7 25 V 10 39 C 3 7 Goal 91 Q V C 7

ANALYZE Define the main root cause for the duplicated effort. Lack of a common systematic for monitoring system implementation, including metrics and visual management panel. Tools used: Fishbone Material Man Because this kind of knowledge is not listed on functions description Because it is not the functional area focus have an IT tools specialist Because this knowledge is not mandatory to exceute the area activities 5 whys Lack of knowledge on IT tools available Duplicated Effort for Metrics and Visual Controls implementation Because there is no one responsible to create a common process Because each area is responsible only to provide the data no matter the format ause there is no guide or system to be followed for ess Each area creates its own independente control Methods Machines 8

IMPROVE Classify potential solutions according to selection criteria and choose the one that better fits to lean culture. Tools used: Decision matrix Solution Proposals Σ Simplicity Develop Internally Easy to use Investment Automatic Graphs Easy to Standardize Less data consolidation Excel spreadsheet locally stored 25 5 5 5 5 3 1 1 Excel spreadsheet stored in network 25 5 5 5 5 3 1 1 Excel spreadsheet stored in Share Point 23 5 5 3 5 3 1 1 Share Point site with lists and libraries 21 3 5 1 5 1 3 3 Share Point site integrated with MS Access 33 3 5 5 5 5 5 5 Share Point site integrated with XML forms 19 1 1 1 1 5 5 5 Share Point site integrated with standard XML form 19 1 1 1 1 5 5 5 9

Solution Details Create the Share Point site for data collect Upload project documents into site library Input some information to save the document Reports and graph available based on input information Advantages: Place to store the activities history data Structures data to generate automatic reports and graphs No specific IT programming required Advantages: Small user routine impact Flexible for expansion No documents format change required All historic data stored in one place Advantages: Few simples question to complete to upload a new item Data upload is part of day-by-day job (currently only communicate by email) Advantages: Reports always updated with last input data No duplicated efforts to create a report or graph (only once) Full history of Project activities 10

Standard Measurement Units Quality: Based on the document upload loop and reason for upload Volume (Schedule Attainment): Base on the actual date filled-out in document upload form Cost: Based on cost check answer in document upload form 5-Excellence 4-OK 3-OK with comments 2-Not OK/No Info 1-PROBLEM Q V C Completed at first time Completed but not at first time Completed with rework/revision First time not successful Not completed and revised Document published on time On time but not published yet Finished late No due dates (no planning) Late and not finished <= Target and finished <= Target on going Pending document No target available > Target 11

CONTROL Monitoring system automatically updated based on projects documents upload Work instruction published and training sessions done Functional Area List the documents to be monitored and filed Lean Team Define what documents creates each QVC metric Program Mgt Input the due dates for activities evidences uploads Program Mgt Insert projects to be monitored on Project Master List Functional Area Upload the project documents in the system QVC Monitoring Automatic metrics and visual controls 12

Conclusions Product development can benefit from the use of lean optimization tools and methods applied in manufacturing. Each new product/process development is unique in its contents, but the work done in each project is similar. Major improvements expected in the medium term, due to the time required for the incorporation of new culture. The use of the lean operating system combined with the cultural change can increases the waste visibility in product development area so they can be properly eliminated. 13

Questions? Thank you for your attention! Cristiano Marques de Oliveira Delphi Automotive Systems Email: cristiano.m.oliveira@delphi.com Phone: 55-12-3978-2528

BACK-UP SLIDES

7 Types of Waste Correction Re-designs, additional testing, audits, correcting documentation, inspection, etc. Overproduction Completing a process earlier than is needed, producing more than is needed, or processes not being synchronized Movement of Information Material or information that is moved from one location to another, such as: o o o Unnecessary handoffs Emails or creating redundant status reports Multiple locations of storage for the same information Motion Usually focuses on man and machine Attending unnecessary meetings, reviews, tours, etc...without any action Waiting Waiting for decisions or information including approvals or not having the right information I order to start a process Inventory Excess information or material waiting to be processed Information waiting for a resource to begin work Processing Redundant tasks, designing new components rather than using existing ones, or lack of standardization 16

Lean Principles Make right part, right time, right volume Short lead time Built in quality High capacity utilization High resource utilization 17

Policy Declaration Discipline All information is on time, accurate and correct before starting work. Escalation is used assure compliance Efficient Quality, Lead time and Cost of each process step is tracked and continuously improved to benchmark levels. Effective All Program Imperative commitments are met. Problem Prevention A culture of perfection by anticipating and identifying defects before they occur. Perfect A culture of not passing along defects that are detected to assure 100% quality to downstream processes & customers. On Time Master program schedule exists and is respected, with visual controls and achievement plans in place. At Cost Total product cost is monitored and achieved by the process. Capability All People are developed and trained to follow the OS, and their time is used efficiently. 18

QVC Gates Quality The gate evaluates the quality of the work that is performed in that process It should identify mistakes, omissions, and sub-standard work for each output It requires that a standard be developed and a means of evaluating the work against the standard (checklist, calculations, computer program) Volume (Schedule Attainment) The gate evaluates the schedule attainment of the work performed in that process It requires a clear definition of when this process step begins and when it is completed and those events must be measurable Cost The gate evaluates the cost variance (+/-) related to work performed in that process against the business case or budget allocation for that work It requires a clear definition of how, if at all, the process directly impacts product cost, capital cost, or development cost The QVC gate can omit the cost evaluation if the process step does not impact cost 19

Why use Visual Controls Allows you to passively see status OK or not OK Drives immediate action Highlights capacity issues and supports reallocation of resources Identifies roadblocks Reminds you what to work on Motivates you to hit targets (don t want to be red ) Provides you a means to monitor process control Encourages system/process improvements Promotes awareness of process and status Tracking of QVC expectations Possibly used for predicting QVC issues 20

Monitoring Systematic OK? OK? OK? Start Quality Volume Cost Return QVC => Status of our Outputs Monitoring => Visual Control of QVC s Management Routines => Drive Action based on QVCs 21

Metrics Implementation Summary Initial Situation New Situation 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 25 39 7 7 10 3 Q V C NOK OK 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 0 0 0 32 49 10 Q V C NOK OK Type OK NOK Type OK NOK Q 7 25 Q 32 0 V 10 39 V 49 0 C 3 7 C 10 0 Goal 91 Goal 91 22

Visual Management by Project 5-Excellence 4-OK 3-OK with comments Q V C Active Closed On-hold 08-001 08-002 08-003 08-004 08-005 08-006 08-007 08-009 08-010 08-014 08-015 08-016 08-017 08-022 08-023 08-024 08-025 08-026 08-027 08-031 08-032 08-034 08-035 08-036 08-044 08-041 08-043 08-047 08-008 08-011 08-012 08-013 08-021 08-040 08-038 08-042 08-028 08-029 08-030 08-048 08-049 Cancell ed SA306- Calha/Cover VW SA329- Caixa BFRM SA331- Modificação da Caixa do Pálio SA312- Base J-Case SA385- Localização 10W 150 SA298- Header 26w Siemens VDO SA299- Header 32w Siemens VDO SA301- Two Pieces One Step SA302- Calha N-Lev SA307- Code D - DC SA314- Abraçadeira Black SA315- Abraçadeira Natural SA309- Caixa de Fusivel VW Gol NF SA389- Loc ASM CONN 2 F 6.3 FASTIN-ON BLK SLD SA390- Loc ASM CONN 1 F 6.3 TIMER BLK SLD STD PWR SA391- Loc Montg ASM CONN 2 W SA392- Loc ASM CONN GT 6W 280 SA393- ASM CONN 8M GT 150 SLD BLK SA394- Loc ASM CONN 4W GT 150 GRY SLD SA386- Fuse Box Renault Logan Conector fuse 7F SPT 6.3 Conector 10F MXD SLK 2.8 Con 10 vias (Key less go) SA405- PDU 326+327 Low SA298- Header 12w Siemens VDO SA430- Clip Toyota SA298- Header 6w Siemens VDO SA33- ASM Conn 2F M/P 150 SLD- Gravação VW no conector da lanterna SA300- Rail Blower Siemens SA303- Loc Montagem ASM CONN 8F GT 150 SA304- ASM CONN 8F GT 2.8 SLD BLK SA305- ASM CONN 2M GT 280 SA399- Maxi Fuse Renault Logan ASM Conn 10F Slide Lock ASM Conn 4F Yesc 630 Conector 8F MQS 0.64 SA395- Loc Fbr Asm Conn 2W (Doors Conn) SA396- Loc Conn. 6W SA397- Loc Asm Conn 8W 280 Cable Channel for VW Cable Channel for GM Cruvinel, Alexandre Da Costa Cruvinel, Alexandre Da Costa Cruvinel, Alexandre Da Costa Cruvinel, Alexandre Da Costa Cruvinel, Alexandre Da Costa Sumita, Paulo Cruvinel, Alexandre Da Costa Cruvinel, Alexandre Da Costa Cruvinel, Alexandre Da Costa Cruvinel, Alexandre Da Costa Cruvinel, Alexandre Da Costa Marini, Marcos Cruvinel, Alexandre Da Costa Cruvinel, Alexandre Da Costa 2-Not OK/No Info 1-PROB LEM Completed at first time Completed but not at first time Completed w ith rework/revision First time not successful Not completed and revised Document published on time On time but not published yet <= Target and finished <= Target on going Finished late Pending document No due dates (no No target available planning) Late and not finished > Target PipeName MetricName Function QVCFlag Customer Requirements (Y/G folder, DR, or 4.1 - Define Customer Requirements Q 4 4 4 4 2 5 5 5 equiv) Sales - Vendas V 5 5 1 5 1 1 1 3 5 1 1 1 1 3 1 2 1 2 DFMEA Initiated PE - Eng. Produto V 5 5 5 2 5 5 5 5 5 5 5 5 5 4.2 - Develop Design Investment Request PM - Gestão de Projetos V 3 5 1 1 3 3 3 3 2 5 5 3 3 3 3 3 3 2 3 5 5 2 2 2 2 Product Design Review PE - Eng. Produto V 5 5 5 5 3 3 5 5 2 2 2 5 5 2 5 2 2 PIR accepted by Finance FIN - Finanças V 5 1 1 5 5 1 1 1 1 1 1 1 1 1 MSD ME - Eng. Processos V 5 5 1 3 PFMEA Initiated ME - Eng. Processos V 3 3 3 2 1 1 2 1 1 1 2 5 5 5 5 5 3 2 1 5 2 1 2 2 2 2 3D Model / 2D Drawing (PD) PE - Eng. Produto Q 5 4 5 5 5 4 5 5 5 4 5 5 2 V 3 5 5 5 5 3 3 3 1 5 2 5 2 2 Validation Plan PE - Eng. Produto Q 2 4 2 4 5 5 4 4 4 5 4 5 4 3 4 V 2 5 5 5 1 5 5 2 3 3 4 4 1 5 2 5 2 2 2 Investment Released FIN - Finanças V 1 5 1 1 1 1 1 1 5 5 1 1 1 1 1 1 1 1 1 Piece Cost / Investment PM - Gestão de Projetos V 1 1 1 3 1 1 1 5 5 5 5 1 1 1 C 3 3 3 1 3 3 3 5 5 1 1 3 3 3 4.3 - Develop Process 2D Drawing (TQD) PE - Eng. Produto Q 5 4 4 V 2 5 2 Prototype Purchase Requisition PE - Eng. Produto C 2 Prototype Design Release PE - Eng. Produto Q 5 V 5 Prototype Parts Available PE - Eng. Produto V 2 4.4 - Validate Design Prototype parts Test Request PE - Eng. Produto Q 5 V 5 Purchase Requisition for Test Devices PE - Laboratório C 4 Prototype Validation (if required) PE - Laboratório V 1 4.6 - Refine Design 3D Model / 2D Drawing (PD) PE - Eng. Produto Q 4 5 V 2 3 Refined Validation Plan PE - Eng. Produto Q 3 V 3 2D Drawing (TQD) PE - Eng. Produto Q 4 5 4 4 4 5 5 5 4 4 V 3 5 5 5 3 3 3 1 3 2 5 Tool Release Authorization (Eng. Release) / 4.8 Q 4 4 5 5 4 4 4 4 4 5 5 4 4 Eng. Changes PE - Eng. Produto V 5 5 2 3 3 3 3 3 3 5 5 3 3 4.7 - Refine Process ME Purchase Requisition ME - Eng. Processos C 5 5 5 3 3 3 3 3 5 2 2 2 2 2 2 5 3 4 3 2 2 Purchase Requisition for External Tool C 3 3 3 3 3 3 3 3 3 Design/Build ME - Tool SQE Piece Cost / Investment PM - Gestão de Projetos V 1 4 1 1 1 1 1 4 4 4 4 1 1 1 C 3 3 3 3 3 3 3 3 3 Tool Design Review ME - Ferramentaria V 1 2 5 1 1 1 1 4 4 5 1 1 5 1 2 2 Tool Drawing (tool build start-up) ME - Ferramentaria V 1 2 5 1 1 1 1 1 5 1 5 1 2 2 Purchase Requisition for Parts of Internal Build ME - Ferramentaria C 3 5 5 3 3 3 3 5 3 5 3 5 5 Tools Tool Release (internal build) ME - Ferramentaria V 4 1 1 1 1 1 Tool Release (external build) ME - Tool SQE V 1 1 1 1 1 1 1 1 Tool Design Change ME - Ferramentaria Q 3 Tool Try-out Request ME - Ferramentaria V 1 4 1 1 1 1 1 1 4 4 1 1 1 Equipment Build Leadtime ME - Eng. Processos V 2 4 2 1 1 4 4 2 4 4 4 3 3 5 4 1 1 2 2 Launch / Kick off Tool ME - Ferramentaria Q 4 1 2 2 V 3 4 1 1 1 1 5 1 1 4 4 1 1 1 Purchased Parts Check availability of APQP GSM - Compras V 4 1 1 1 1 timing chart Purchased Parts Approved date meet GSM - Compras V 4 1 1 1 1 Run@Rate due date Purchased Parts Approved date meet PPAP due GSM - Compras V 4 1 1 1 1 date Inspection Report Request (dimensional) ME - Eng. Processos V 3 4 3 4 1 1 1 1 4 4 4 4 4 1 2 1 Control Plan CS - Qualidade Q 4 2 2 5 4 4 4 5 5 4 5 4.8 - Complete Validation 1st samples (or 1st shots) & Inspection Report Q 2 3 5 1 ME - Eng. Processos V 1 4 1 1 4 3 1 3 1 4 4 4 1 1 2 V 1 4 1 4 1 1 1 1 4 4 4 1 1 Technical Tool Release ME - Eng. Processos 2 4 4 4 5 3 5 2 Validation Test Request PE - Eng. Produto Q 4 5 5 5 5 5 5 5 5 5 V 3 3 5 3 3 3 5 3 2 2 4 4 4 4 4 4 4 Q 3 Capacity Study ME - Eng. Processos Purchase Requisition PE - Laboratório C for Test Devices 3 3 3 3 3 Validation Complete / Test Conclusion PE - Laboratório Q 2 2 3 Notification V 4 1 5 4 1 1 3 1 4 4 4 4 4 1 1 V 4 3 5 3 5 4 4 4 5 5 Ready for PPAP PE - Eng. Produto 3 5 1 2 2 2 Manufacture Process CS - Qualidade Q 2 5 4 5 Release 5 5 5 V 1 3 3 3 3 5 5 4 1 1 1 1 4 4 4 4 1 Q 5 2 4 5 5 PPAP CS - Qualidade 5 4 2 4 5 5 2 V 3 5 3 3 3 5 5 1 2 2 2 5 1 4 1 4 1 4 4 4 4 1 1 V 1 4 1 4 1 1 1 4 4 4 1 1 Production Piece Cost / Final Investment PM - Gestão de Projetos 4 4 4 C 3 3 3 3 3 3 3 23

Visual Management by Area 24