TGB2.01 Lean Six Sigma Define Phase Rev RK 20060224

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Six Sigma
2.01 Lean Six Sigma Define Phase
Green Belt Training Transactional - Week 2 -
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Agenda
1. Define Phase Overview 2. Project Identification and Selection 3. Project Scoping 4. Project Chartering 5. Project Management
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Six Sigma Green Belt Training, 2.01 Lean Six Sigma Define Phase
Version 2.1 2006-02-24 SKF/AIT
Lean Six Sigma Define Phase 1. Define Phase Overview

-3Six Sigma Green Belt Training, 2.01 Lean Six Sigma Define Phase Version 2.1 6 November, 2006 SKF/AIT
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DMAIC Roadmap
Six Sigma Methodology and Roadmap for Common Tool Usage
Define
Measure
Analyse
Improve
Control
Project Charter Process Map Rolled Throughput Yield Voice of Customer (SIPOC) Value Stream Map Cause & Effect Matrix Potential Failure Mode and Effects Analysis Measurement Systems Analysis Data Collection & Sampling Statistical Process Control Capability Study Multi-Vari Study Hypothesis Testing/Confidence Intervals Design of Experiments Control Plan Celebrate
-4Six Sigma Green Belt Training, 2.01 Lean Six Sigma Define Phase Version 2.1 2006-02-24 SKF/AIT
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Define Phase
Define the Problem Identify the Customer Select Output Characteristic and Identify Key Process Input and Output Variables and Graph Performance Outline the Financial Consideration of the Project Develop High Level Process Map Scope Project and Outline Scope on Process Map
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Define Phase
Purpose To obtain a clear understanding of the problem to be addressed To define the problem and parameters and to establish well defined boundaries To identify the input and output variables To develop roles, responsibilities, process steps, goals and milestones
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Define Phase
Deliverables A well defined problem statement, objective and improvement metric - project charter Identification of the process or products customers A Y/X diagram or similar graphic to outline the relationship between the input and output variables A primary metric trend chart indicating performance A high level process map A project scope including designation on the process map
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Lean Six Sigma Define Phase 2. Project Identification and Selection

-8Six Sigma Green Belt Training, 2.01 Lean Six Sigma Define Phase Version 2.1 6 November, 2006 SKF/AIT
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Objectives
Review of importance in selecting good Six Sigma projects Process to select Six Sigma projects Includes:
-Process for idea generation -Sorting for good Six Sigma projects -Prioritising
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Project Identification
Source of inputs for Six Sigma projects: Link to the SKF Business strategies;
-10 % operating Margin -6% sales growth -4Z: (* Zero Defects, * Zero Broken Promises, * Zero Accidents,
making businesses)
* Zero Loss
-Beyond zero (sustainability)

Other targets/activities from Business Plan/Scorecard Voice of Customer (VOC); e.g. satisfaction review Audits/Reviews Ideas individuals; Sponsors, Managers and other employees Spin off effects from other projects
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Project Identification Methods

Top-Down (Y) Projects are identified through association with the Metrics of the companys Strategic Plan or Business Plan Strategic / Operating Plan Goals, Issues, Metrics
Opportunities Opportunities to to reach reach the the goals goals
Issues Issues needing needing attention attention
Opportunities: Gaps in needs, Performance, New Markets, Problems, Defects, Dissatisfied Customers, Unused Capacity
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Bottom-Up (X) Projects are identified through association with current programme, process or product gaps, issues, challenges
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Six Sigma Project Identification

Y Y1 Y2 Y3 Y4 Yn
Improved quality
Specific SpecificSix Six Sigma Sigmaprojects projects
Delivery Service
Reduced cost
Profitable Growth
Y2,1
Y2,2
Y2,3
Y2,4
Reduced ReducedCycle Cycletime time for Time to Market for Time to Market
Y2,3,1 Y2,3,2
Reduce ReduceCycle CycleTime Time from idea conception from idea conception to tonew newproduct product Reduce ReduceCycle CycleTime Time for marketing for marketingof of new product new product
Root RootCauses Causes
X2,3,2,1
X2,3,2,2
X2,3,2,3
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Linking Projects to Corporate Goals

Corporate Goals Customer Satisfaction Business Critical Ys Project Clusters
B1a
Potential Projects
1 2 3 4 5 6
Six Sigma
B1
Growth
B1b B1c B1d B1e
B2 B3
Other Initiatives
Productivity / Cost
Quick Actions
Capital
B1f
All projects must connect

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Project Difference in Complexity
$$$$
Continues Improvements, Ground fruits Six Sigma Projects
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Other Projects where Six Sigma is not suitable
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Look for the Right Metrics for Projects

Sigma Level Rolled Throughput Yield (RTY) Defects Scrap & Rework Inspection time Broken promises Capacity or Cycle Time Customer Satisfaction and Warranty Costs Supplier Quality Overtime Expedited Freight ...
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Elements of a Six Sigma Project
Project Statement
-Describe, in detail, the problem (defect) that the business wants to solve and
why it is a problem
-The problem statement should also include the baseline data and statistics
that support the justification as a project
Process Deficiency Basis
-Is the problem caused by defective process (Common Cause or Special

Cause)
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Clear Objectives
-Describe, in detail, the objective of the project and, what and how the
business experts to improve as a result of completing the project Reduction in costs Improved quality Improved Product/service on-time delivery
Is the required data/measurements available? Can a measurement system be implemented?
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Reasonable Scope
-The project should be scoped for completion in approximately 6 months to

maintain momentum and enable correction with training (less than 4 months for GB).
Return on Investment
-Describe, in detail, the calculation basis and assumptions for the projects
savings goal.
-Projects with lower potential returns should be calculated as potential

future Green Belt project
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Well Defined Ownership
-Project teams must be comprised of all significant process experts. -Managers with fiscal responsibility for the focus process area must be
ultimately responsible for the project implementation.
Management Commitment (Resources)
-Is the budget available to support capital required expenditures? -Are necessary team members available in the time frame of the project?
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Project Categories Based on Complexity

Examples of projects that are too big and too complex for Six Sigma are: a new factory acquisitions
S I X S I G M A
Improvement projects, following DMAIC roadmap led by Black Belts
If the actual task is too complex for this level, it should be moved to next level
Less complex problems and improvement projects, following DMAIC roadmap led by Green Belts
Continuous improvements, e.g. Five Whys Five S , QITs
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Projects Type
Start with your customer!

External Driven Projects (one who receives finished goods) Reactive to customer concerns / complaints Proactive to customer desires (strategic projects)
Internal Pain Projects (next process operation) Result from not doing things right the first time, poor system design, poor information flow, poor work flow systems
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Example of Manufacturing Projects
Conformance to external customer use specifications;
-Warranty reduction, customer satisfaction projects to ultimately improve

profitability
Conformance to internal product specification;
-Most products have manufacturing standards to meet (often related to

rework and scrap) to reduce cost
Operational efficiency;
-Processing time, material usage, equipment and facility usage to reduce cost
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Example of Administrative Process and Service Operations Projects

Internal Business Processes (payroll systems, mail systems, accounting systems) Order System Processing (internal processing time, errors, amount of rework) Application Processing (internal approval process) IT Systems (information flow, complaints) Human Resource Management (staffing, training, benefits analysis)
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Example of Customer Transactional Projects
Call Centres (response/ resolution time) Ordering Systems (order time to delivery, order accuracy) Hospital Systems (patient flow) Human Resource Management (customer service training) Retail Services (wait time, customer satisfaction)
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Project Selection Process
This entire process is recommended, especially for the first Six Sigma projects Leaders new to selecting Six Sigma projects should consider coaching from Champions and MBBs Tip: First Six Sigma projects tend to need re-scoping as Belts and Leaders gain experience Scoping is the process in which some projects should be expanded, and some will need to be divided to close on time
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Six Sigma Project Identification and Selection

Detailed process reviewed in Sponsor Training
Create Project Ideas List
No pass
Not typical Sigma Projects
Input
Assure the linkage to the Business Strategies
Review with the "Filtering questions"
Pass
Potential Projects Hopper
Six Sigma Project Hopper
Create a draft Project Charter
Prioritise the ideas
Assign Sponsor and Belt
Finalise the Project Charter built on a SIPOC

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Verify scope and approve project start

Run project
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Excerpt from Project Charter

Excerpt from the Six Sigma Charter to remind us all Six Sigma projects should improve one of the major drivers (10, 6, 4Z, Beyond Zero).
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Prioritise Using the

<SKF Project Selection Matrix.xls>
Simply list all of your sorted projects and sum the leaderships votes to help in prioritising.
Weight Criteria Category
Existing Six Sigma Project Ideas: State the Problem project? Author
10
10
Strategic
Strategic or important customer need
10
10
10
10
10
Business Fit
Sales Improves and Improves or impact or develops Core develops growth Product or Core potential Service Offering Competency
Financial
Project Ranking
Strategic gap
TVA impact
BOI impact (annualized)
10
10
10
10
10
10
Solvability
10
Stakeholder
Zero Accident impact
Data Scopable Causes and to achieve available or solutions Broken Zero Zero Loss in < 6 possible to Probability Belt unknown or Promises Defects Businesses months validate of success available not validated
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Project Prioritisation Matrix

Project Prioritization Matrix FILTERS 1 2 3 4 5 6 Prioritizations from: 1(low), 3 (medium), 9 (high) 1 2 3 4 5
EASY TO DO (up to 4-6 months) GIVES A PROFIT STRATEGIC (link to Scorecard) HIGH PROCESS FREQUENCY Solution/ root cause Known or solution is easy to implement? Problem being addressed elsewhere? Y/N Project address strategic area ? Y/N Total Savings/Benefit meets the target?Y/N Process under our control Y/N? New product/ process or service? Y/N
VALUE FOR CUSTOMER
Criteria
Project Name
No. Steering Seal Optimization 2 (zytel parts) Eliminate rework of phosphated stampings at 5 satellite plants 4 Curl Design change Increase FTY/decrease cost 1 for new product tools
1.3 9
1.5 6.429
1.5 9
1.3 2.714 9
SAVINGS ESTIMATION / YEAR FOR PRIORITIZED PROJECTS (in $ U.S) Hard Soft not 47.37 $ 193,754 estimated
N N N
N N N
Y Y Y
Y Y Y
Y Y Y
N N Y
9 5.57143 0
3 3 0
9 3 0
4.429 9 0
9 9 0
3 Crankshaft Seal Optimization N 0 0 0 0 0 Y Y Y Y N 6 7 8 9 10 HINTS FOR PROJECT SELECTION: 1) Problem not to simple to solve 2) Try to formulate title starting with word: " Improve" or "Decrease " 3) For the first (learning) projects select to improve something what is: easy to measure with (preferably) continuous data, and easy to collect the data 4) Do Project Priority results fit with gut feeling ?? >>>>>>>>> IF NOT - RECHECK THE SCORING
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PROJECT PRIORITY
$55,000 not 36.94 $ 75,000 estimated not 0.00 $ 84,456 estimated not 0.00 $ 38,266 estimated 0.00 0.00 0.00 0.00 0.00
44.46 $ 216,174
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Six Sigma Critical Success Factors
If the projects arent important
Management is reluctant to dedicate resource & time
and results wont happen

Lean Six Sigma Define Phase 3. Project Scoping

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Project Scoping
Project scoping has been one of the largest areas of opportunity within many organisations Six Sigma deployment efforts
Issues have cantered primarily around over scoping the Six Sigma Belts initial projects
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Project Scoping
Responsibility for Project Scoping
Project Sponsor
Primary Lead
Six Sigma Belt
Secondary Lead
The Project Sponsor has the ultimate responsibility in effectively scoping a project however the Belt has a vested interest and should be included in the process
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Project Scoping
Support for Project Scoping
Project Sponsor
Primary Lead
Six Sigma Belt
Secondary Lead
Master Black Belts Experienced Black Belts
Deployment Champion
The Project Sponsor and Belt should use their available resource pool in scoping projects
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Project Scoping
Narrowing the Scope
World Peace Boil the Ocean World Hunger
Issue with Large Scoped Projects
Additional Time Required to Close Project
Tangible cost of deployment Intangible costs increase

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Project Scoping
Narrowing the Scope
Tangible cost of deployment

Higher material costs Higher labour costs
Intangible costs increase

Frustration due to lack of progress Diversion of manpower away from other activities Delay in realisation of project benefits Team member turn-over Lower project closure rates Decline in the confidence of the Six Sigma programme
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Project Scoping
Narrowing the Scope Larger scoped projects should be broken down into a number of smaller projects Small Projects Small Projects Small Projects Small Projects Any project that is scheduled to take longer than six months to complete should be broken down into smaller subsequent projects
Larger Projects
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Project Scoping
Tools Used for Scoping a Project Y=f(X) Diagram High Level Process Map (SIPOC) Value Stream Mapping Cause and Effect Diagram (fishbone) Cause and Effect Matrix Pareto Chart
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Project Scoping
Tools Used for Scoping a Project
Y=f(X) Diagram can be used to progressively uncover the deeper relationship between an issue and its constituents
The relationships are continually uncovered until a factor is identified that would serve as an adequate scope for a Six Sigma project
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Project Scoping
Reference: Ford Motor Company Consumer Driven Six Sigma Project Guidebook
Y=f(X) Diagram Example - Lemonade Y = X1 + X2 + X3 + X4

The taste of a glass of lemonade is dependent on: X1 the type of lemon ingredient X2 the amount of sugar added X3 the type of water added X4 the amount of ice added The type of lemon ingredient is dependent on: X1 if it was from fresh squeezed lemons X2 if it was from liquid concentrate lemons X3 the it was from powder concentrate lemon
Y = X1 + X2 + X3
Y = X1 + X2 + X3 + X4 + X5
In this example an adequately scoped project may deal with the process for how the lemons are squeezed as indicated by the circle around X4 A fresh squeezed lemon are dependent on: X1 where the lemons are grown X2 how the lemons are transported X3 age when squeeze X4 how the lemons were squeezed X5 if pesticides where used when growing
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Project Scoping
High Level Process Map outlines the boundary area for a project scope The area addressed by the scope in a process map is circled If the circle encompasses a large process area or if there is more than one circle in separate areas of the map ... The project may be overscoped
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Project Scoping
Business Process (Strategic)
Process Mapping Example

Business Development
Business Processes
Sales
Underwriting
Contracting
Customer Service
SIPOC
S
Underwriters
Terms
Docs
Neg
Close
C
(ext.) Customers (int.) Cust. Service Dept.
Detailed Sub-process Map

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Project Scoping
Cause and Effect Diagram (fishbone) can be used to outline the boundary area for a project scope in the same manner as the process map however with respect to causes instead of process steps
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Project Scoping
Pareto Chart can be used to break down a project scope using numerical data the Pareto chart is typical used in conjunction with one of the above methods to select the area of focus
If the potential scope encompasses several bars on the Pareto chart, the project may be over-scoped
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Project Scoping
Refining the Scope After data is collected in the measure phase it may be required to go back and refine the scope and redefine the project specifics
Define Re-scope Measure If re-scoping is required the project charter should be revised
Data
Lean Six Sigma Define Phase 4. Project Chartering

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Six Sigma DMAIC Roadmap

Six Sigma Methodology and Roadmap for Common Tool Usage
Define
Measure
Analyse
Improve
Control
Project Charter Process Map Rolled Throughput Yield Voice of Customer (SIPOC) Value Stream Map Cause & Effect Matrix Potential Failure Mode and Effects Analysis Measurement Systems Analysis Data Collection & Sampling Statistical Process Control Capability Study Multi-Vari Study Hypothesis Testing/Confidence Intervals Design of Experiments Control Plan Celebrate
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Write Project Charters for Project Hopper
For projects chosen that require a Six Sigma resource If variation is the likely cause - choose Six Sigma
-If the cause of the problem are waste, long lead time, long set-ups,
consider using lean approach or a combination of lean and Six Sigma.
Using the Sponsor, Belt, and others if necessary Recognising that further development of charter will be required by the Sponsor and Belt
Note: Controller is necessary and critical for successful project savings - Involve the Controller from the start to estimate all potential savings
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Project Descriptions and Charters
A REQUIREMENT for Belts to enter Six Sigma training!
Must have metrics identified PRIOR to training
NOTE: A Belt can enter training with multiple projects!
NOTE: A charter is a requirement to begin a Six Sigma project

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Check for Accountability
Personal Level Each Belt, Sponsor, and Business Leader must be held personally accountable for the success of the project Reflected in performance review criteria
Business Level Sponsor accountable for the project closure at goal
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Project Charter Elements

Project Title and General Information 1. Problem Statement 2. Process Impacted 3. Benefit to Internal and External Customers 4. Benefit to the SKF Business 5. Constraints 6. Project Scope 7. Goals - Metrics 8. Project Costs 9. Milestone Chart/Schedule
Lean Six Sigma Define Phase 5. Project Management

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Project Management
Keys to Successful Project Management Project Charter Milestones from Project Plan - Belt Gantt chart Weekly schedule reviews Formal toll gate review process
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Project Management
Project Plan Every Belt project should have a detailed Gantt chart The completion of DMAIC phases should be outlined as milestones Work Breakdown Structure (WBS) of the Six Sigma Road Map should be developed, based on experience and similar projects, for each phase Gantt chart should be used to manage the daily control of the project and to make decisions
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Project Management
Weekly Schedule Reviews Sponsors review of the Belts projects in their area 30-60 minutes in duration Used to monitor all continuous improvement activity within an area Road blocks should be reviewed GYR (green-yellow-red) format used to identify projects requiring additional help G = ok, Y = team has correction plan in place, R (or Y on consecutive weeks) = requires separately scheduled supplemental Sponsor project review
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Project Management
Formal Tollgate Review Process Typically performed on monthly or as needed basis Review performed by Sponsor and Master Black Belt Approval required at the end of each phase for the Black Belt to continue on to next phase Review of goal / purpose, deliverables, relevant tools for each phase Key questions guide review
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Green Belt Training Transactional - Week 2 -

Version 2.1 2006-02-24 SKF/AIT

Lean Six Sigma Define Phase 1. Define Phase Overview

Version 2.1 2006-02-24 SKF/AIT

Version 2.1 2006-02-24 SKF/AIT

Lean Six Sigma Define Phase 2. Project Identification and Selection

Version 2.1 2006-02-24 SKF/AIT

-Beyond zero (sustainability)

Project Identification Methods

Issues Issues needing needing attention attention

Six Sigma Project Identification

Specific SpecificSix Six Sigma Sigmaprojects projects

Root RootCauses Causes

Linking Projects to Corporate Goals

B1b B1c B1d B1e

All projects must connect

Project Difference in Complexity

Other Projects where Six Sigma is not suitable

Version 2.1 2006-02-24 SKF/AIT

Look for the Right Metrics for Projects

Elements of a Six Sigma Project

Process Deficiency Basis

-Is the problem caused by defective process (Common Cause or Special

Version 2.1 2006-02-24 SKF/AIT

Elements of a Six Sigma Project

Is the required data/measurements available? Can a measurement system be implemented?

Version 2.1 2006-02-24 SKF/AIT

Elements of a Six Sigma Project

-The project should be scoped for completion in approximately 6 months to

-Projects with lower potential returns should be calculated as potential

Version 2.1 2006-02-24 SKF/AIT

Elements of a Six Sigma Project

Well Defined Ownership

Management Commitment (Resources)

Version 2.1 2006-02-24 SKF/AIT

Project Categories Based on Complexity

Improvement projects, following DMAIC roadmap led by Black Belts

Continuous improvements, e.g. Five Whys Five S , QITs

Version 2.1 2006-02-24 SKF/AIT

Start with your customer!

Version 2.1 2006-02-24 SKF/AIT

Example of Manufacturing Projects

Conformance to external customer use specifications;

-Warranty reduction, customer satisfaction projects to ultimately improve

Conformance to internal product specification;

-Most products have manufacturing standards to meet (often related to

Example of Administrative Process and Service Operations Projects

Version 2.1 2006-02-24 SKF/AIT

Example of Customer Transactional Projects

Version 2.1 2006-02-24 SKF/AIT

Project Selection Process

Version 2.1 2006-02-24 SKF/AIT

Six Sigma Project Identification and Selection

Not typical Sigma Projects

Review with the "Filtering questions"

Potential Projects Hopper

Six Sigma Project Hopper