© 2006 MHTC, Inc.© 2006 MHTC, Inc.

Green Belt Certification

Chapter 5

Lean Six Sigma for Government Certification Series

Introduction to Continuous Process Improvement (CPI)

DMAIC (CONTINUED)

DMAIC in CPIImprove

• Improve Stage Objectives– Develop Potential Solutions– Evaluate and develop optimal solutions– Create To-Be value stream maps– Pilot the solution– Confirm project goals and objectives will be met, build a

business case for change– Develop a full-scale implementation plan

• Purpose– To identify and validate the solutions that will add value

for the customer in a more cost effective and efficient process defined by the projects scope.

– To confirm benefits of process change.– To prepare to execute full-scale implementation.

DMAIC in CPIImprove

• Generate Potential Solutions– Refer to Root Causes from

Analyze– Lean Six Sigma Techniques– Idea Generation

• Brainstorming • Benchmarking

DMAIC in CPIImprove

• The Lean Manufacturing Philosophy– Muda = Waste:

• Anything that uses resources without providing value to the customer (DoD CPI Guidebook)

• Eliminate it– 7 Ways to Waste

• Poor Quality - Mistakes/Defects• Inventory• Over Production• Unnecessary Process Steps• Transportation/Moving• Waiting/Delays• Excessive Motion

DMAIC in CPIImprove

• Lean Concepts (George, Rowlands & Kastle, What is Lean Six Sigma?)

• Delight Customers– Quality, Speed and Cost (Value)– Voice of the Customer (VOC)

• Improve Processes• Work as a Team• Make Decisions Based on Data

DMAIC in CPIImprove

• Cellular Processing

IN

OUT

CELLULAR FLOW

DMAIC in CPIImprove

• Error Proofing (Poka Yoke)– Design parts that fit only one

way

– Warning devices that prevent rather than catch the error

• User-Friendly

• Simple to Install

• Don’t require close attention from employee

• Low-cost

• Provides instantaneous feedback, prevention or correction

DMAIC in CPIImprove

• Kanban (Card)

• A signal from a customer to a supplier within an organization’s internal operations and/or throughout the entire supply chain .

• Triggers the entire supply chain to respond to the customer demand.

• Work-order / AFTO 350 Tag

DMAIC in CPIImprove

• Automated Resource Planning – Material Resource Planning

(MRP)

– Manufacturing Resources Planning (MRP II)

– Maintenance, Repair and Overhaul (MRO)

– Enterprise Resource Planning (ERP)

• Integrated planning for physical, material and human resources

• May include external suppliers

DMAIC in CPIImprove

• Mixed Model Scheduling– Avoids separate

lines– Batches– Match Customer

Orders– Requires rapid

changeover

DMAIC in CPIImprove

• Pull – Production or Maintenance on Demand

– Customer-Supplier Relationship Internal and External

– Reduce inventory while satisfying the external customer

– Manage capacity better

WarehouseReceiving

Shipping

Manufacturing

Inventory

Inventory Inventory

Inventory

PUSH SYSTEM

Receiving

Shipping

Manufacturing

Inventory

PULL SYSTEM

CustomerCustomer DemandDemand

Supply PushSupply Push

DMAIC in CPIImprove

• Reliability Centered Maintenance : RCM/RCM 2

Reliability Fact-Based Decision Making ProcessReliability Fact-Based Decision Making Process

Repair & Record

MeetsDesign

life

Yes

One TimeCondition

Overused/Overstressed

Yes

No

Yes

PermanentUsage Change

Bad Actor

Required LifeNot Met

Mis-handled

Infant Mortality

Wearout Mode

Redesign For Robust Rugged

Modification Retro-fit

Retire Replace

Corrective Action

Higher Quality ComponentScreen Burn-in

Overhaul USLFP

No

No

1 2

3

8

7

6

9

5

4

DMAIC in CPIImprove

• Takt Time – German for beat/rhythm

– Pull concept for tuning the rate of the process to customer need

– Synchronizing Supply and Demand

– Computed rate that a process in a value stream should operate at to just satisfy customer demand

– Analysis of flow in the process identifies non-value- added steps

DMAIC in CPIImprove

• Theory of Constraints (TOC)– Developed by Eliyahu Goldratt focus on:

• Identifying the system’s constraint• Exploit the constraint to optimize performance• Subordinate all else to the attention on the constraint• Elevate the constraint to reduce its influence

– Equipment, personnel, eliminate waste, balance flow• Go back to step one and repeat for new process

– Critical Chain (CC): a planning tool that respects constraints across a number of projects or activities.

DMAIC in CPIImprove

• Value-Added– In the eye of the customer

– Three types of Activities

• Value-Added

• Non-Value-Added

• “Necessary” Non-Value-Added

– The Goal Identifying and Reducing or Eliminating NVA Activities

Can eliminate without impacting

customer?

Can eliminate without impacting

customer?

Value AddedValue Added

Eliminate ifpreceding activitydone correctly?

Eliminate ifpreceding activitydone correctly?

Required by a Control?

Required by a Control?

Customer request? Customer request?

Impact internal customer?

Impact internal customer?

Improving internal efficiency

Improving internal efficiency

Non-value addedNon-value added

NecessaryNecessary

Non-value addedNon-mandatory

Non-value addedNon-mandatory

Can control be eliminated?

Can control be eliminated?

Yes

No

No

Yes Yes

No

No

Yes

Yes

Yes

No

No

Yes

Value Added Analysis

No

Yes

DMAIC in CPI Analyze

DMAIC in CPIImprove

• Total Productive Maintenance (TPM)– Design products that can be produced with existing

equipment

– Design machines, tooling and fixtures for easier operation, changeover and maintenance

– Train and retain personnel

to operate and maintain

equipment

– Purchase machines that

maximize production potential

– Design preventive mainte-

nance plans that span the

life of the equipment

Just too much Maintenance

DMAIC in CPIImprove

• Quality at the Source– A quality philosophy that places

responsibility for meeting customer specifications and standards at the point of task accomplishment.

– Approaches

• Source inspection for purchased components and consumables

• Personnel self-inspection of their work and that of previous steps

• Poka-Yoke: Design and utilize mistake proof equipment, processes and products.

DMAIC in CPIImprove

Quality At The Source

DMAIC in CPIImprove

5 / 6 S• 5S

– Seiri: Sort – Get rid of clutter • Separate the needed from the unneeded• Eliminate the latter

– Seiton: Set in order• Everything in its proper place

– Seiso: Shine, i.e. Clean the work area– Seiketsu: Standardize

• Establish written standards for cleanliness– Shitsuke: Sustain i.e. Make the first 4S a habit

• 6S = 5S + Safety

DMAIC in CPIImprove

DMAIC in CPIImprove

• Visual Management: Making information that is relevant about the process clear, timely and regular.– Displays production status– Communicate between departments/shifts– Faster response to problems– Increased awareness of Waste– Promotes culture change

DMAIC in CPIImprove

• Visual Management– Subjects: Safety, security, training, productivity

measurements, production status, process performance, housekeeping, defect/scrap rate.

– CAUTION! Visual Management is not show and tell for the bosses! Don’t be seen as showing off to upper management or bragging about the goals you set.

DMAIC in CPIImprove

Single Minute Exchange of Dies (SMED)– Reduce Setup Time– Not limited to

Manufacturing– The Approach

• Separate internal and external setup

• Convert internal to external setup

• Streamline setup• Perform setup in

parallel or eliminate • Document procedures

DMAIC in CPIImprove

• Batch Size Reduction– Applicable to Manufacturing &

Maintenance & Other– Reduce batch size by

eliminating constraints• Tradition• Instructions (lack-of)• Equipment• Material• Co-dependency

– Large batches strain systems– Cost vs. Benefit

DMAIC in CPIImprove

• Production Leveling– SMED

– Batch Size Reduction

– Automated Resource Planning (JIT)

– Mixed Model Scheduling

DAILY PRODUCTION

0

10

20

30

40

50

OOUTPUTS

VO

LU

ME

DAILY PRODUCTION

0

2

4

6

8

10

12

14

OUTPUTS

VO

LU

ME

DMAIC in CPIImprove

• Point-of-Use Systems– Placing required resources at the site of production

Cus

tom

er S

ervi

ceC

usto

mer

Ser

vice

Custom

er Service

Custom

er Service

Inventory

Quality Assurance

Person 1

Person 1

Person 1

Person 1

Personnel

Personnel

Personnel

Personnel

Person 1

Management

Personnel

DMAIC in CPIImprove

Point-of-Use Systems– Placing required resources at the site of production

Cus

tom

er S

ervi

ce

Custom

er Service

Inventory

Quality Assurance

Person 1

Person 1

Person 1

Person 1

Personnel

Personnel

Personnel

Personnel

Person 1

ManagementPersonnel

Personnel

Personnel

Person 1

Person 1

DMAIC in CPIImprove

• Standardized Work– An agreed upon set of work procedures that:

effectively combine people, materiel, and machines to maintain quality, efficiency, safety, and predictability.

– Define the Work• Cycle Time• Work in Process (WIP)• Sequence• Takt Time• Layout • Inventory needed to conduct the activity

– Poka Yoke

DMAIC in CPIImprove

Best Practices (Benchmarking)• Benchmarking is a process of comparing

– Who do we compare ourselves to?

• Benchmarking is a continuous process– If you want to stay on top you have to keep

climbing.

• Benchmarking is a measurement and analysis process.– What Characteristics do we measure?

– How do we measure?

DMAIC in CPIImprove

• Home Grown Ideas– Who knows the As-Is work best?

– Do people ever complain about how work is done?

– Do people ever say things like:

• “If we only had this tool, computer, etc.”

• “Why don’t we do it this way.”

• “I know there has to be a better way.”

– Is the organization’s culture receptive to new and innovative Ideas?

– Some of the best and brightest minds are in your own organization. USE THEM.

DMAIC in CPIImprove

• Rank and Select Solutions

IMPLEMENT EASY

BIG PAYOFF LITTLE PAYOFF

IMPLEMENT POSSIBLE

CHALLENGE KILL

IMPLEMENT HARD

52

3

1

6

7

4

DMAIC in CPIImprove

• Develop To-Be Process Models/Maps– Model Activities

• IDEF 0

• Business Process Modeling Notation (BPMN)

– Model Cost

• Activity Based Costing (ABC)

– Model Data

• IDEF 1X

– Develop To-Be Process/Activity Maps

• Cross Functional Process Mapping

DMAIC in CPIAnalyze/Improve

• IDEF 0 – Context Diagram

PROVIDE DOUGHNUTS AND PASTRY

A0INGREDIENTSCUSTOMER ORDERSUPPLIESBILLPAYMENT

SALEMATERIAL ORDERPAID BILLBANK DEPOSIT

PERSONNEL

RECIPEPOLICY & PROCEDURESHEALTH REGULATIONS

EQUIPMENTINFORMATION SYSTEMFACILITIES

BUDGET

Internal (Private) Business Processes

High Level Internal Model

Take Order

+

ObtainMaterial

+

MakeProduct

+

SellProduct

+

Take Order

+

Take Order

+

ObtainMaterial

+

Take Order

+

ObtainMaterial

+

Take Order

+

MakeProduct

+

ObtainMaterial

+

Take Order

+

SellProduct

+

MakeProduct

+

ObtainMaterial

+

Take Order

+

Do

ug

hn

ut

Sh

op

Abstract (Public) Processes

SellProduct

+

MakeProduct

+

ObtainMaterial

+

Take Order

+

Do

ug

hn

ut

Sh

op

Customer

Place Order Deliver Product

Collaborative (Public/Global) B2B Processes

Ship OrderFill Order

ReceivePurchase

Order

Fo

od

Ser

vice

Ven

do

r

SellProduct

+

MakeProduct

+

ObtainMaterial

+

Take Order

+

Do

ug

hn

ut

Sh

op

DMAIC in CPIImprove

Resources

Cost Objects

Activity &Activity

Cost Pool

ACTIVITYCENTER(s)

RESOURCEDRIVER Cost

Element

ACTIVITYDRIVER

ABC Model

PROCESS

A B C

DMAIC in CPIImprove

Resources

Cost Objects Derived from IDEF- 0 Outputs

Activity &Activity

Cost Pool

ACTIVITYCENTER(s) RESOURCE

DRIVER CostElement

ACTIVITYDRIVER

IDEF interviews & Controls

Activity definitions

Activity Surveys

PROCESSfrom

Strategic PlanBSP

Goals & Objectives

Direct from IDEF-0 activities

IDEF Inputs and Mechanisms, as well as

Traditional Ledger Accts

-- Derived from Traditional reports-- Expenses incurred-- Interviews

ICOMs Point To Entities

Enroll

Student

StudentEnrolledNew

Student

Registrar Staff

Course Schedule

An

Student

Course-Schedule

Personnel

DMAIC in CPIImprove

Departments (Organizational Elements/Units)

Symbols:Start, Activity, Decision, etc.

Activity Flow:Arrows

DMAIC in CPIImprove

• Develop To-Be Value Stream Map

Field UnitOutsideSource

AssembleInspectMachinePlateMachine

Disassemble

Warehouse

ERP

Material/Production

Control

Inspect/Order Parts

Pack/Ship

LANDING GEAR OVERHAUL

Rework Process

PASS

FAIL

Repairable Item

Packing Material

Assembly PartsMachiningConsumables

MachiningConsumables

PlatingConsumables

Repairable Item

Consumables &Repair Parts

Request for Replacement

30/60/90 DayPurchase Order

Ship Order

Name UnitValue

Name UnitValue

Name UnitValue Name UnitValue Name UnitValue

Name UnitValue

Name UnitValue Name UnitValue

Name UnitValue

DMAIC in CPIImprove

• Proof the Concept – Design of Experiments (DOE)

– Introduction to Prototyping/Piloting

– Introduction to Benchmarking

– Introduction to Simulation

Design of Experiments (DOE)• Experiments vs. Observations• Experimental Approaches

• Trial and Error• One factor at a time• Multiple factors at a time

(DOE)

• Purpose of DOE: What drives the process?

• Identify which Xs are Significant to Y

• Quantify relationships between Xs and Y

• Confirm Improvement• Set Xs to Optimize Y

DMAIC in CPIImprove

DMAIC in CPIImprove

Prototyping/Piloting• Test the To-Be

• Mitigate Risk

• Tweak the Process

• Less Disruption

• Lower Cost

DMAIC in CPIImprove

Benchmarking• Benchmarking is a

process of comparing– Who do we compare

ourselves to?

• Benchmarking is a continuous process– If you want to stay on top

you have to keep climbing.

• Benchmarking is a measurement and analysis process.– What Characteristics do we

measure?– How do we measure?

Uses & Benefits of Simulation

• Test Assumptions About the Process

• Conduct “What If” Scenarios

• Mitigate Risk– Lets process

improvement be tested while current process continues

– Less cost involved

– Make corrections before implementation

DMAIC in CPIImprove

Simulation• Discrete-Event

System Models– Number of customers

waiting to be served is a discrete event

– There is a specific number at given points in time

DMAIC in CPIImprove

DMAIC in CPIImprove

Simulation• Continuous System

Models– Amount of Oil flowing

through a pipeline varies continuously

– The volume of oil passing a given point can vary depending on pressure, rate, supply and demand

DMAIC in CPIImprove

Develop Business Case• Introduction to Business Case Analysis• When is BCA applied in CPI?

– Preliminary BCA

• Develop Preliminary Business Case Analysis (BCA)

• Perform Technical Review of BCA Documents

– Final BCA

– Update BCA

• BCA as a Management Tool

DMAIC in CPIImprove

Types of BCA

(Analyze)(Analyze)

(Improve)(Improve)

(Control)(Control)

1. Review process improvement recommendations

2. Review organizational change management plan

3. Review technology change management plan

4. Develop preliminary Business Case Analysis

5. Perform technical review of BCA documents

6. Validate/revise preliminary BCA report

7. Prepare final Business Case Analysis report

8. Review and approve BCA

Steps to Document the BCA Decision Package

DMAIC in CPIImprove

DMAIC in CPIImprove

Approve Final Solution

• Once senior authority approves the improvement plan actual deployment may begin

• Deployment planning and execution are key to success

DMAIC in CPIImprove

• Plan and Implement Solution– Organization

(culture & structure) change management plan

– Technology change management plan

– Project management planning

– Visual Management

DMAIC in CPIImprove

Organization & Culture Issue Areas

• Organization Culture

• People Skills and Knowledge

• Organization Structure and Demographics

• Organization Policies and Directives

DMAIC in CPIImprove

Technology Enablers• Process Information

• Automation

• Tracking

• Parallelism

• Analysis Support

• Artificial Intelligence

• Relocation of

• Activities

DMAIC in CPIImprove

Deployment Strategies

• Phased deployment – involves bringing on

parts of the new process on line over time

• Parallel deployment – involves keeping the

old process going while bringing the new process on line.

• Big Bang deployment – the all at once scenario