OMEGA Course Material v3.2

BENCHMARK SIX SIGMA
BLACK BELT PROGRAM

OMEGA MODULE
ENGAGING LEADERS AND TEAMS
BIG Y TO SMALL Y, ROOT CAUSE ANALYSIS
DEFINE PHASE OF D-M-A-I-C PROJECTS
© Benchmark Six Sigma. Version 3.2 All Rights Reserved 1

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➢ Course Material comprises of soft copies of Course Books
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➢ Minitab software will be used for all graphical and statistical exercises. Individual
laptops are required for all days of the training course
➢ Trainer notes are not available in soft copy. Please take notes as required

Lean Six Sigma Black Belt Modules
Omega Ω Iota, Ι Zeta, Z Epsilon, Ε Theta, Θ

Omega is the symbol Iota denotes a Small “Born Last”, It is the The maximum error Angular Position,
of last, best, or final difference sixth letter that can occur Temperature
Big Y to small y to root Metrics and

Process Stability Hypothesis Testing Experimentation
cause measurements
Measurement System Hypotheses and

Review of DMAIC Process Capability Design of Experiments
Analysis Comparisons

Lean Six Sigma Black Belt Modules
Omega Ω Iota, Ι Zeta, Z Epsilon, Ε Theta, Θ

Omega is the symbol Iota denotes a Small “Born Last”, It is the The maximum error Angular Position,
of last, best, or final difference sixth letter that can occur Temperature
Big Y to small y, Root Metrics and

Process Stability Hypothesis Testing Experimentation
cause analysis measurements
Measurement System Hypotheses and

Review of DMAIC Process Capability Design of Experiments
Analysis Comparisons

OMEGA – Overview
Project &
Change
CTQ
Management
identification
Project DMAIC
Selection overview
Project Root Cause

Charter Analysis
Refresher Refresher

Lean Six Sigma Critical Success Factors
➢ Top Management Support & Commitment
➢ Well Defined Project Selection Process
➢ Full Time Lean Six Sigma Leaders
➢ Business Improvement Process Framework
➢ Quantifiable and Measurable Results

Causes of Lean Six Sigma Failure
➢ Organizational Culture Effort
o We have tried this before & it failed Commitment Compliance
o Everyone has their own agendas
➢ Management Support
o Not attending toll gate review meetings
o Lack of control for completed projects
o Not providing full-time resources Time
o No retention program for trained personnel
Compliance requires low initial
o Lack of right projects effort but long-term organizational
change is a challenge…
➢ BB Resources
Commitment takes high initial
o Failing to appreciate people issues effort but long-term organizational
o Focusing on certification change is easier.
o Avoiding resistance

Organizational Change Management
➢ Organizational change management is the process of managing change with a focus on
people and culture.
o Process (Way the work flows)
o Structure (Organizational structure)
o People (Experience, Education, Skills)
o Culture (Behaviors, Beliefs)
➢ Change management focus is to communicate the value of the change and manage any
resistance.
➢ Communicate the need for change

o Burning Platform
➢ Change management tools

o SWOT analysis, Stakeholder analysis
o Influence strategy, Communication plan
o Changes to the Organizational structure
o Reward strategy

John Kotter: The Heart of Change
We See, We Feel, We Change
➢ Step 1: Increase Urgency
➢ Step 2: Build a Guiding Team
➢ Step 3: Get the Vision Right
➢ Step 4: Communicate for Buy-In
➢ Step 5: Empower Action
➢ Step 6: Create Short-Term Wins
➢ Step 7: Don’t Let Up
➢ Step 8: Make Change Stick

Stakeholder Analysis
➢ Stakeholder analysis can be done to measure resistance
o Identify key stakeholders of the project
o Identify the importance of stakeholder support for the project
o Identify current level of support/resistance
o Develop strategy to move each stakeholder to the required level of support.
➢ Key stakeholders can be either of the following:
o Process owners
o A contributor to the process
o Anyone affected or benefited by the process
o Anyone who has an interest in the process/ project
➢ Identify the importance and current commitment of key stakeholders in
the scale from Low – Med – High.
o If importance is Low, keep the stakeholders informed
o If importance is Med/High, and commitment is Low, then engage the
stakeholders appropriately.

Stakeholder Analysis: Example
Key stakeholder Importance Current Commitment Recommended actions
Keep interacting with him. Try

Production Director involving him. Detail him of all the
High Med
(Sponsor) intricacies/ resources required/
constraints.
Purchase executive Med Low Counsel with him.
Prod Planning Manager High High OK
Material control executive Low High OK
Financial representative Low Low Counsel him. Consult Finance Mgr.
In case of opposition or resistance, resolve it before proceeding further in the project

Types of Resistance
➢ Parochial Self-interest
o Some people are more concerned about themselves than the effect on the
success of the business
➢ Misunderstanding
o Communication problems, inadequate information
➢ Low Tolerance to Change

o Some people need to be very secure and stable
➢ Different Assessment of Situation

o Some people may see different advantages & disadvantages with the
proposed change

How to Deal with Resistance
➢ Education & Communication
o Inform & educate people of the change beforehand.
➢ Participation & Involvement
o Involve key stakeholders in the change process
➢ Facilitation & Support
o Be supportive of employees during difficult times
➢ Negotiation & Agreement
o Offer incentives to employees not to resist change
➢ Manipulation and Co-optation
o Bring resistors into change committee (but not listen to them!)
➢ Explicit & Implicit Coercion
o Force employees to listen (fear of job loss etc)

Managing Teams
Abilene’s Paradox
➢ Team Meetings On a hot afternoon visiting in Coleman, Texas, the family is comfortably playing
dominoes on a porch, until the father-in-law suggests that they take a trip to
o Meeting Frequency Abilene [53 miles north] for dinner. The wife says, "Sounds like a great idea."
The husband, despite having reservations because the drive is long and hot,
o Ground Rules thinks that his preferences must be out-of-step with the group and says, "Sounds
good to me. I just hope your mother wants to go." The mother-in-law then says,
o Communication "Of course I want to go. I haven't been to Abilene in a long time."
The drive is hot, dusty, and long. When they arrive at the cafeteria, the food is as
bad as the drive. They arrive back home four hours later, exhausted.
One of them dishonestly says, "It was a great trip, wasn't it." The mother-in-law
➢ Address Resistance says that, actually, she would rather have stayed home, but went along since
the other three were so enthusiastic. The husband says, "I wasn't delighted to be
o Overbearing participants doing what we were doing. I only went to satisfy the rest of you." The wife says,
o Feuding "I just went along to keep you happy. I would have had to be crazy to want to go
out in the heat like that." The father-in-law then says that he only suggested it
o Groupthink because he thought the others might be bored.
The group sits back, perplexed that they together decided to take a trip which
o Floundering none of them wanted. They each would have preferred to sit comfortably, but
did not admit to it when they still had time to enjoy the afternoon.
o Rushing to accomplish or finish
➢ Techniques to Address Assign one person as critical evaluator

o Coaching Leaders don’t express their opinion upfront
Invite outside experts to the meeting
o Mentoring Discuss solutions with outside team members
o Intervention
o Monitor progress & reward accomplishments
Addressing Resistance
➢ Clarify & summarize different points of view
➢ Look for points of agreement & disagreement
➢ Use facts & data
The greatest oak tree
➢ Put yourself in the other person’s “shoes” was once a little nut
that held its ground.
➢ Focus on ideas and not personalities
➢ Ask how to resolve conflict
➢ Give everyone a chance to air their concerns
➢ Deliver quick wins
➢ Use LCS method – first talk about Likes, then discuss Concerns
& finally Suggestions for improvement

Force Field Analysis
➢ Force Field Analysis helps us think
about the pressures for and
against a decision or a change. It
was developed by Kurt Lewin.
➢ To carry out a Force Field
Analysis, we describe our plan or
proposal in the middle of a piece
of paper or whiteboard. Then we
list all of the forces for change in
a column on the left-side, and all
of the forces against change in a
column on the right-side.
➢ We can use our analysis to think
about how we can strengthen the
forces that support the change
and weaken the forces opposing
it, so that the change is more
successful.

OMEGA – Overview
Project &
Change
CTQ
Management
identification
Project DMAIC
Selection overview
Project Root Cause

Charter Analysis
Refresher Refresher

Identification of Projects and CTQs
VOC Analysis (pain areas

identified on the basis of
Customer’s Voice)
List Down the Potential

VOB Analysis (pain areas Problems /Projects of
Identification of
identified on the basis of Business
CTQs Organization on the basis
problems)
of the above analysis.
COQ Analysis (pain areas

identified on the basis of Cost of
Poor Quality i.e. Process Defects) Self
Provided for self study

Project Identification Methods
Voice of the • Hear the emotional outburst of the customer Self

Customer (VOC) or • Do a self review in comparison to the competitors
Market • Example – Coffee delivered by you is not as tasty as served by “Mestle”
• Check if the business goals are being met and identify the gaps.
Voice of the • Find the opportunities for improvement
Business (VOB) • Example – We have not been able to meet our annual plan for our Cash flow in this
fiscal year.
Voice of Employees • Take feedback from employees in further identifying the scope.
/ Associates (VOE) • Example – A sudden increase in the number of people are falling ill
• Hidden factories, Wastes, and Defects

Voice of the Process • High resource consumption, Product unreliability
(VOP) • Example – Though we have increased the machine efficiency, the cycle time for the
product still remains the same.
• Projects based on high COQ can be retrieved from data on COQ from QA, Internal
Cost of Quality Audits and Management Engineering.
(COQ)
• Example – The field failures have risen suddenly in last few months.

VOC
Voice of the Customer (VOC) can help you understand the
Customer
customers requirements. These requirements could be
External broadly categorized as
1. Features: Does the process provide what the customer
expects? This closely relates to quality of the product
Voice of Customer and/or service
Customer’s Voice
2. Delivery: Does the process meet the customer’s time
- Surveys
frame? This closely relates to timeliness of the product
- Questionnaires
and/or service
- Interviews
- Focussed Group 3. Expense: Does the customer perceive value for the
Discussions (FGDs) price? This closely relates to cost of the product
- Complaints and/or service
VOC is the as-is expression of customer needs and desires
✓ May be specific – “I need delivery on Tuesday”
Identification of
Projects and CTQs ✓ May be ambiguous – “Deliver faster”

VOB
Voice of the Business (VOB) is often best obtained from
Customer
the Process Owner and represents the health of the
Internal organization
Voice of Business VOB is usually captured using a Balanced Scorecard –

organization’s scorecard. It comprises of around 20
Stakeholder’s Voice
measures under 4 components
- Balanced Scorecard
1. Financial Metrics
2. Customer Metrics
3. Internal Business Process Metrics
4. Learning and Growth Metrics
These measures provide information about

➢ Past Performance (Lagging Indicators)
Identification of
Projects and CTQs ➢ Future Performance (Leading Indicators)

Balanced Scorecard (VOB)
➢ It is a performance management tool that looks at more than just the financial
output (which is a lagging indicator):
o Financial Metrics
o Customer Metrics
o Internal Business Process Metrics
o Learning and Growth Metrics
➢ We should have no more than 20 measures across all of these metrics, so that the
management can focus on what is important.
➢ The chosen metrics need to reflect the strategy of the company. A new company
may want to focus on revenue from new products while a mature company may
focus on total revenue
➢ Each metric is tracked at least on a monthly basis and reviewed by management. If

a metric is red (behind target), it is a candidate for launching a Lean Six Sigma
project

Balanced Scorecard
Adapted from The Balanced Scorecard by Kaplan & Norton

Balanced Scorecard

Balanced Scorecard

Balanced Scorecard
If a metric is red (behind target), it
can be a candidate for launching a
Lean Six Sigma project

CTQ Identification
➢ “I want this product delivered faster”

➢ “You missed your quarterly budget numbers”
➢ “You haven’t grown market share”
➢ “Your product is not reliable”
➢ “I don’t like the changing delivery dates”
➢ “We need faster answers to our queries”
➢ “Our inventory levels are too high”
For some of the examples, CTQ identification might be easy but for others you
might feel that the statement is high level/vague and would require further drill
down.

Choice of CTQ and Project Y
➢ Best CTQ is:

o On lowest possible level
o Agreed upon by ‘Customer’ to address its needs
➢ Best Project Y:
o Is on lowest possible level
o Can be proven without too much effort to have a strong link with the
CTQ
o Is actionable
o Is agreed upon by Champion

The Big Picture
Input Process
variables variables (X’s) Process outputs Customer
(X’s) X X
X X
X
Y1
X
Project
X Y2
Y3 CT’s VOC
X Y3
Project Y3 = f(X1,X2,X3…Xk)
Goal is to control the X’s in order to fix Y such that we satisfy the customer’s needs

CTQ drill down (Tree diagram)
It relates high-level strategic focal points to project objectives. In

their turn project objectives are linked to and decomposed into
CTQs, which are made operational in the form of measurements.
When to use CTQ drill down:

1. Project definition is vague without indicating which
parameter needs to be improved.
2. Parameters/Dimensions on which project should aim are
framed in more abstract terms and not in a tangible or
specific form
3. When parameters lack operational form or are defined from
a customer perspective rather than process control
perspective

Metrics and Project Y’s
➢ Sometimes the CTQ and the Project Y are the same
➢ Sometimes you need a more specific item to work upon. This item
must be linked to the CTQ
➢ The measure of that item is called ‘Project Y’
Y1
CTD Y2 Project Y
Y3
VoC CTQ
Y1
In some projects, we will
CTC Y2 have to drill deeper into
Y3
the process to identify
the Project Y
Primary Metric

Example of Drill down
Variability of
Too much process
obsolete Safety stock
Inventory level levels Forecasting
Critical performance
material/comp. Order
to Costs
too high Procedures Delivery
Too much (Min/max,Q)
excessive performance
Days of inventory People
on hands Follow Others
procedures
Project Y: Relative
Production
forecast deviation
planning
Others
Use a Decision Tree to drill down

Goal- Means Diagram
Goal CTS
Big Y
Goal Goal Goal Goal CTQs
Means (y) Means (y) Means (y) Means (y)

CTPs
Means (y) Means (y) Means (y) Means (y) Means (y) Means (y) Means (y) Means (y)

Goal-Means diagram example
Improve the
service
Faster Better Cheaper
TAT for
Lead time Cost of
complaint Productivity
compliance quality
resolution
Customer
TAT for satisfaction
Effort
SR/CR score
variance
SLA
Defect rate
compliance

Goal-Means diagram example

Problem Definition Tree Example
Operating expenses for Operating expenses

this fiscal year are are very high
$1,000,000 [$ 1000000]
Work area A contributes

to 50% of the total Work area A Work area B Others
operating expenses [50%] [20%] [30%]
(TOE)
Drilling down shows that

overtime expense of Budgeted Overtime Scrap Other
work area A represents [25%] [15%] [7%] [3%]
15% of TOE
Finally it can be seen

that machine setup time Machine
Other
represents 12% of TOE setup time
[3%]
of the facility [12%]
Objective statement: Reduce the machine setup time by 50% to realize savings of $60000

Voice of Customer
We did not meet 2018 Customer Delivery Goals (Management Objective)
Tool / Reason to
Basis of Split
23% 69% 8% Eliminate Boxes
Existing Pareto of $$ late
Product Age New Products Other
Products [% of total]
18% 39% 12%

Digital Highest proportion of
Product Family Cable TV Other
Telephone late deliveries
22.7% 16.3%
Subscriber Critical new product
Product Type Other
Interface Unit family
3% 18% < 2%
Causes for Late Parts First Pass
Other Pareto
SIU Deliveries Shortages Yield
Problem Statement: First pass SIU yield for digital telephone is 77%
Objective: Raise First Pass Yield (FPY) to 95%

Line operations effectiveness too low (17%)
Basis of split Reason

83% 29% 73% 99%
Type of Planning Availability Performance Quality relative
loss (planned production (operational time (net operational time (valuable operational contribution
time / total time) / planned op. time) / operational time) time / net op. time)
Type of % of
6% 60% 0% 1% 2% 13% 13% 5% Availability
activity losses
Set up Change Man Material Material Repair Close Other (=downtime)
over shortage shortage defects down
Problem Statement: ‘Change over’ contributes 60% to our downtime

Objective: Decrease Change over time by half

1st rule for making splits
Boxes in a split should not overlap
Incorrect Types of Produce Fruit Oranges Apples
vs.
Parent Dictionary Fruit
Correct
Types of Fruit Apples Oranges Other Fruit
Types of Apples MacIntosh Granny Smith Other Apples
Mixed signals are obtained if boxes overlap

2nd rule for making splits
Splits must encompass the whole dictionary
from the level above (add up to 100%).
Use a common basis for boxes within a split
Incorrect Dictionary Split Apples Oranges How can these be

added up?
vs.
Parent Dictionary Fruit
Correct Kinds of Fruit Apples Oranges Other Fruit
Kinds of Apples MacIntosh Red Del Other Apples
Important information can escape if the whole

dictionary is not represented

3rd Rule for Making Splits
Split boxes must be accessible

i.e. must be able to run experiments / gather data that rule boxes out
Incorrect Material Processing

Dictionary Split Requires SEM
Defects Defects
vs.
80% 20%
Location of Concentration
Correct Defects
Left End Right End
Diagram
Reverse part
Dictionary Split Parts Process
through process
Inaccessible boxes result in multiple open branches

Rules for using Decision Trees
➢ Use logic to make splits

o be creative, search for alternatives
➢ Never move to the next level until the most important family
is identified.
➢ Preferably all but one box on a level can be ruled out
o if not look for a different split
➢ Make broad splits first, detailed splits later.
o Avoid testing individual X’s until end of the Solution Tree
➢ Use facts and physical laws to make decisions.
o If facts are not available, use people’s knowledge via a Cause and
Effect Matrix

Practice Exercise 1
High-level problem: Our profit margins are shrinking
Insights: A leading bank CEO identifies shrinking of profit margins for 2

consecutive quarters. The profitability of the north, northeast and east
regions was calculated. The northeast region was the least profitable. There
are two key processes in the northeast region - wire transfer and check
clearance. Wire transfer, the low profitability process, is the focus of the BB
project. The two main parameters for this process are lead time and accuracy
of transfers. On prima-facie data analysis, majority of issues / non-
compliances were observed with respect to lead time.
Construct a problem definition tree and write down the objective for the
project.

Quality Function Deployment (QFD)
It is a tool that can help translate raw Voice of the Customer

statements (VOC) into specific measurable project CTQ’s or
Project Y’s. QFD provides a process for planning new or
redesigned products and services.
VOC
CTQ
QFD: Steps
In essence, the QFD matrix can be completed by taking the following steps:
1. List the customers’ needs (i.e. the what’s).
2. Classify and assign priority index to the customers’ needs
3. List the technical attributes of the design to fulfil the needs (i.e. the how’s).
4. Determine the relationships between the what's and the how's; strong
relationships are given a score of 9, moderate a score of 3, and weak a score
of 1
5. Calculate scores for each how. This is done by multiplying the priority index
column with the relationship score under the respective how column.
6. Identify those how’s with high weighted scores. (CTQ’s)
7. Check the correlation matrix to check the relationships of the how's
8. Define the targets and limits on the how's (not shown).
9. Determine further course of action.

QFD Example- Printer

QFD Example- Credit card

Replication Opportunities
➢ Look for projects that were implemented in one area that could benefit
from implementing in other areas. This requires a database of completed
projects across the company.
➢ Before reinventing the wheel, look for projects in other divisions, best
practices, competitive information if available.
➢ Projects are often scoped so they can be completed in a short period of

time – focus on one specific aspect of an overall issue. This often implies
significant opportunity to replicate the results in other areas.
➢ Replication helps a company complete the projects faster and deliver

greater rewards to the company.

Benchmarking: Another Source of Ideas
➢ Compare cost, time, quality of what one area/group/organization does
compared to other area/group/organization.
➢ Best Practice:
• Compare processes with respect to a best practice usually within sector
• Example look at cost & efficiency of competitors
➢ Collaborative Benchmarking:
• Benchmarking carried out collaboratively by a group of companies.
➢ Strategic Benchmarking:
• Look at how others compete. Look across industries
Lot of times, people don’t try new things because they don’t believe it is possible to do it.
Benchmarking provides facts & data to individuals of what others are doing, so that they can do
the same.

Primary & Secondary Metrics
➢ Primary metric, Project Y, is the output of the process that we

can measure which if we improve will lead to greater
customer satisfaction.
Project Y CTQ VOC
➢ Secondary metrics are metrics that we need to track to

ensure that we are not adversely affecting the process by
just focusing on the primary metric alone.
➢ Example: Project to improve delivery time.

o Primary Metric: Time to deliver product since order is placed.
o We can reduce this time by excessively increasing inventory which is
not the right way to approach the problem. Secondary metric could
track the amount of inventory in the system.
EXERCISE
Think of appropriate secondary metrics for the following cases:
1. Reduce time for preventive maintenance activities.

2. Reduce cost for component A in the assembly.
3. Reduce number of poor-quality shipments to customer.
4. Improve customer satisfaction score.
5. Decrease call handling time in support center.
6. Increase internal quality score in a service process.
7. Reduce turn around time for account opening in a bank.

OMEGA – Overview
Project &
Change
CTQ
Management
identification
Project DMAIC
Selection overview
Project Root Cause

Charter Analysis
Refresher Refresher

Prioritization Matrix- Example 1
➢ Used for prioritizing the available project ideas

➢ Also known as Selection Matrix
➢ Is an aid to project selection
➢ Can be customized based on the organizational preferences

Prioritization Matrix- Example 2
Project prioritization matrix is a top-down approach that defines potential
projects that line up with the firms strategic objectives
AHP
The weighting factor for your

criteria is typically made on a
1-to-10 scale with 1 being a
negative effect and 10 being a
positive effect.

OMEGA – Overview
Project &
Change
CTQ
Management
identification
Project DMAIC
Selection overview
Project Root Cause

Charter Analysis
Refresher Refresher

DMAIC Roadmap
Step 1: Generate Project Ideas
D Step 2: Select Project

Step 3: Finalize Project Charter and High-level Map
Step 4: Finalize Project Y, Performance Standards for Y
M Step 5: Validate Measurement System for Y

Step 6: Measure Current Performance and Gap
Step 7: List All Potential X’s
A Step 8: Identify Critical X’s

Step 9: Verify sufficiency of Critical X’s for the project
Step 10: Generate and Evaluate Alternative Solutions
I Step 11: Select and Optimize best solution.

Step 12: Pilot, Implement and Validate the solution
Step 13: Implement Control System for Critical X’s
C Step 14: Validate Effectiveness of Controls

Step 15: Documentation, Transfer and Project Closure

(Priorities)
DEFINE 1=Identify customer requirements (CTQ’s) and Standards • 13=Implement Control Systems
(specifications), 2=Select Project, 3=Charter and Map Start
• Ensure New Procedures Are Used and
CONTROL
Are Effective (also 14= Validate
(Getting an early start on subjective
Preliminary C&E, FMEA Controls)
type of “Analyze Phase” tools)
• 14 Monitor Ever-Changing Customer
Needs and Requirements
4=Develop measures with respect to CTQ standards
(Symptoms, “Y”
• 15 Document, transfer ownership and

MEASURE
Outcomes)
(Specs, Capability, Z) project closure

5=Evaluate Measurement System (MSA) “Voice of the Customer”
6 =Process is reasonably stable? No

6=Collect Process Data**, Is process Stable?, Capable? Yes
6 =Capability acceptable? Yes
“Stability message is in a SINGLE point”
No
No
(Diagnosis, Find Root Causes, X’s)
Simpler Approach Advanced Approach - When

historical data and experience are
7= List all potential X’s insufficient to meet objective
ANALYZE
8 = Use history to Find “Critical X’s” 7,8,9 =Use “Experimentation

• Search for the critical cause: Strategy”
- What is impacting MORE? X
- Which X just exerted its influence on Y? Investigate relationships among
inputs (X’s) and output (Y) via
- 9 = Are critical X’s sufficient for the goal? Y
experiments and/ or DOE:
“Message is in ALL the points” “Message is in ALL the points”
IMPROVE
(Solutions)
• 10=Generate and evaluate alternative solutions

12=Goal • 11= Select and optimize best solution. 12=Goal
realizable? No • Verify Impact/Success (Before Vs After - DOE) realizable? Yes
• 12=Pilot, implement and validate the solution
** =Data from an unstable, unpredictable process can still be used for a “Pseudo-Capability Study” -- A rough “Before Vs After” guess at how
much progress©may be possible
Benchmark Sixif Sigma.
we succeed in improvingVersion
the “approximate
3.2 Z(Overall)” (using “OverallAll
StdDev”)
Rightsto Z(Within).
Reserved 64
OMEGA – Overview
Project &
Change
CTQ
Management
identification
Project DMAIC
Selection overview
Project Root Cause

Charter Analysis
Refresher Refresher

Finalize Project Charter
A project charter is a written document that works as an agreement
between management and the team about what is expected from the
project.
The Charter:
✓ Clarifies what is expected of the team.
✓ Keeps the team focused.
✓ Keeps the team aligned with organizational priorities.
✓ Transfers the project from the champion(s) to the project team.
Project Charter development is an iterative process, a living document

which will change over time

Deciding Scope and Team Members
➢ SIPOC is the tool used for scope determination
➢ Helps us determine boundaries of the process
S I P O C
Supplier Inputs Process Outputs Customer
Steps in creating SIPOC

i. Update Process Column
ii. Update Inputs Column
iii. Update Suppliers Column
iv. Update Outputs Column Self
v. Update Customers Column

SIPOC Example
Supplier Inputs Process Output Customer

Reimbursement Search for WIP
Details and or new Completed / WIP
Employee Receipts reimbursements reimbursements Employee
HR Check for Rejected Finance
Department Bank Details completeness Reimbursements Team
Employee Check for approvals
Partner Bank Details and eligibility Payment Details QC team
Reimbursement
Policy Process payment
Payment Close the
Gateway reimbursement Self

High Level Process Map
➢ Process Map is a graphical representation of the flow of

material and/or information in a process. It shows the
following
o The start point
Self
o The end point
o The decision points
o Sequence of steps
o Current involvement of functions/ departments
➢ Process Maps are living documents and must be changed as
the process is changed
o They represent what is currently happening, not what you think is
happening
o They should be created by the people who are closest to the process

High Level Process Map Self
Standard symbols for process mapping Provided for self study
A RECTANGLE indicates an A PARALLELOGRAM shows

activity. Statements within that there are data
the rectangle should begin
with a verb
A DIAMOND signifies a decision An ELLIPSE shows the start

point. Only two paths emerge and end of the process
from a decision point: No and
Yes
An ARROW shows the A CIRCLE WITH A LETTER OR

A NUMBER INSIDE symbolizes
connection and direction
the continuation of a
of flow flowchart to another page

Steps in Reimbursement Process
Create the High-level Process Map for the employee reimbursement process
1. Search for WIP and open reimbursement requests in the queue
2. Prioritize the requests as per FIFO
3. Check if the reimbursement form is complete (employee, bank,
reimbursement details along with receipts)
4. If incomplete, request is rejected with comments
5. If complete, check for necessary approvals and eligibility
6. If anything is missing, request is rejected with comments
7. If everything is in order, process the reimbursement payment
8. Enter the payment details in records
9. Close the reimbursement request
Self

Answer
Search for WIP and open Prioritize the requests
Start
reimbursement requests as per FIFO
Check if the
No reimburseme
nt form is
complete?
End Reject with comments Yes
No Check for
approvals and
eligibility?
Yes
Close the reimbursement Enter the payment details Process the

request in records reimbursement

Key Elements of a Project Charter
• Why should we do this? What is the benefit?
Business Case • How does this project align with the business strategy?
• What is the quantified value of the project ($$$)?
• What “pain” are we or our clients experiencing?

Opportunity or Problem • What is wrong or not working?
Statement • Why do we think we can generate the value proposition described in the
Business Impact?
• What are our improvement objectives and targets?

Goal Statement • Is the Goal statement ‘SMART’
• How will success be measured? What specific parameters will be measured?
• What are the boundaries of the initiative (start and end points of the process
Project Scope or parts of a system)?
• What authority do we have? What is not within scope?
• Who are the team members?

Team Selection • What is their role?
• How much time will be dedicated to the project?
Self
• How are we going to get this done?
Project Plan/Timelines • When are we going to complete the work?
• What are the major milestones (tollgates)?

Problem Statement and Business Case
Problem Statement: Describe the “why” of project undertaking

• What is wrong or not working?
• When and where does the problem occur?
• Since how long has the problem been occurring?
• How extensive is the problem?
• What “pain” are the customers experiencing?
• What is the “pain” for our business or employees?
• Should include NO BLAME, NO SOLUTION, NO CAUSE
Business Case: Describe the benefits of undertaking the project

• Why is the project worth doing?
• Why is it important to do it now?
• What are the consequences of NOT doing the project?
• What activities have higher or equal priority?
• Does this project align with company strategy? Self
• How does it fit with the business initiatives and target?
• What benefits will be derived from this project?
• Has the business benefits been quantified?

Calculating Financial Benefits
Interpretation of cost savings expected from a Lean Six Sigma project varies from
organization to organization. Primarily, two types of benefits can be achieved - tangible
and intangible
➢ Tangible- Tangible benefits typically have clear, measurable, positive impacts on the
income statement or balance sheet.
o General categories
Cost takeout Cash flow
• • Growth Reduction
Scrap/Rework (incremental earnings), • Reduced Accounts Receivable
• Staffing or Overtime Reduction • Increased Accounts Payable
• Direct Labor Utilization (Increased • Reduced Inventory
Efficiency)
• Reduced Operating Expenses
• Material Cost Reduction
➢ Intangible
o May be difficult to quantify but could be substantial. Example.
• Cost avoidance; NVA to VA
• Customer satisfaction or employee satisfaction

Calculating Financial Benefits
➢ The reported benefits must be directly linked to Lean Six Sigma project,
that is, those which would not have been realized otherwise.
➢ Expenses on the project must be subtracted to get the net benefit from
the project.
➢ A financial analyst must be a member of the project so that all the
financial calculations are verified and approved by him. The project
sponsor must be made a part of the analysis.
➢ Following are the various categories of tangible benefits:
1) Earnings due to Increased capacity.
2) Earnings due to Improved Product Quality / Service Levels
3) Price Adjustment/ Concession Expenditure Reduction due to Improved
Product Quality/ Service Levels
4) Increased Net Sales by reduction in discounts and credits

Exercise
BVA
How will you calculate benefits in the following cases?
Case 1: One company that sells through distributors realized that a large
number of distributors were inactive—that is, they hadn’t sold anything for
the past several months. The company tried to solve the problem through
traditional methods (such as senior sales managers yelling at junior
salespeople, and junior salespeople yelling at distributors), but without any
results. 29 percent of the previously inactive distributors became active after
the LSS project.
Case 2: Most ITES companies in India provide company transport to all

employees. If the organization initiates a project to reduce transport costs
and the projects results in reduction on transport cost per employee per
month (through better utilization and routing), that would be a sustainable
save. However, if the project also results in the organization needing fewer
vehicles due to which additional vehicles can be sold off.

Exercise
Case 3: Projects improving the internal invoicing process, resulting in lower
accounts receivables
Case 4: Projects reducing inventory requirements through increased process

efficiency
Case 5: Projects to achieve conformation to changes in the law
Case 6: Projects for increased safety in the workplace
Case 7: Projects for increasing employee satisfaction
Case 8: Project for improving customer satisfaction

Exercise
Case 9: Three engineers are budgeted for hire in the fourth quarter. The cost of
the three engineers is not in the baseline, nor has any spending for these
engineers occurred. A productivity improvement project eliminates the need to
hire these engineers. Eliminating these planned expenses has an impact on the
future budget.
Case 10: Cycle time reduction project was undertaken. The process cycle time
that involved two workers was reduced by 10 percent. Assuming the 10 percent
amounts to two hours per worker per week, the two workers save four hours per
week. These four hours are allocated to other tasks.
Case 11: One company noticed that only about 20 percent of the sales orders
brought by its salespeople were FTR. In other words, for 80 percent of the sales
orders, the company had to go back to the customer more than once to complete
some requirement that was missed the first time. What was really worrisome was
that nearly 30% of the 80 percent of customers had changed their mind when the
company went back to them, and were no longer interested in buying.

Key Financial Metrics
➢ Return on Investment (ROI):
o The ratio of money gained or lost divided by the initial investment
o A $1000 investment that results in interest of $50 has a 5% ROI
o A $100 investment that results in interest of $20 has a 20% ROI
➢ Internal Rate of Return (IRR):

o It is the effective compound rate of interest which can be earned on the invested capital
o If the IRR is greater than alternate investment with similar risk, then it is a worthwhile
project. The typical hurdle rate is 12%.
➢ Net Present Value (NPV):

o It is the total present value of a series of cash flows that considers the time value of
money.
o Usually used to appraise long-term projects.
o If NPV > 0, then the project would add value to the firm.

Project Charter: Goal
Describe the objective of the project
➢ What is the improvement the project will deliver?
➢ How will the project success be measured?
➢ What specific parameters will be measured?

o Tangible Measures
o Intangible Measures
➢ Is the Goal statement SMART

o Specific, Measurable, Achievable, Relevant, Time Bound
➢ What is the timeline for delivery of the results? Self

Example Problem & Goal Statement
Poor Problem Statement : Our Customers Are Not Paying Credit Card Dues
on Time.
Improved Problem Statement: In the last 10 months (when) in the Asia
Oceania region (where), 20% of our credit card users are more than a month
late (what) in paying the dues. The percentage of late payment is up from
10% in 2003-04 to 30% of outstanding receivables (magnitude) in 2004-05.
This is negatively affecting our recoverable cash flow (impact) by 1000K
USD/year.
Poor Goal Statement: To reduce the %late payments as much as possible, as

soon as possible.
Improved Goal Statement: To reduce the percentage of late payment to 15%
in next 3 months and realize tangible savings of 500KUSD/ year.
Self

Example Problem & Goal Statement
Poor Problem Statement: Human resources is taking too long to fill

personnel requests.
Better Problem statement: Recruiting time for engineers for the South-India
plant is missing the goal of 70 days 90 % of the time. The average time to fill a
position is 110 days over the past 15 months. This delay is adding costs of
$50,000 per month in overtime, contractor labour, and rework costs.
Poor Goal statement: Improve human resources recruitment process

Better Goal statement: Reduce the plant engineer average recruiting time
from 110 days to 50 days, with an upper limit of 70 days. The new goal will be
achieved by Dec’18.
Self

Practice Exercise 2
➢ Poor Problem statement: Claim forms submitted by hospital to the
insurance company have too any errors.
➢ Better Problem statement:___________________
➢ Poor Goal statement: Reduce errors in forms as much as possible, as soon

as possible.
➢ Better Goal statement: ______________________
Self

Project Charter: Scope
Describe the boundaries of this project

➢ What process will the team focus on? Self
➢ What are the boundaries of the process to be improved?
o Start point? Provided for self study
o Stop point?
➢ Who are the stakeholders?
➢ What resources are available to the team?
➢ What (if anything) is out-of-bounds for the team?
➢ Under what (if any) constraints must the team work?
➢ What is the time commitment expected of team members?
If project content is allowed to change freely the rate of change will exceed the rate of progress.

Project Scoping Tool
Tire inflator for IN-SCOPE Tire inflator

Heavy Vehicles that is a
like Bus / permanent fix
Tire inflator
Trucks to the problem
that works for
two wheelers
& cars
Tire inflator that
is based on
Tire inflator mechanical or
that chemical
automatically processes
senses & fixes
Self

Team Selection
➢ Identify the departments closely associated with the problem
➢ Choose a representative from each department
➢ Check authority, responsibility, and knowledge of each member.
➢ Any change triggers resistance. Sometimes the resistance is so strong that
it becomes the cause of failure of the project. There are active and passive
resistors. Passive are difficult to handle. Resistance is a part of the scope
of the project and should be handled at the earliest.
“There is nothing more difficult to take in hand more

perilous to conduct, or more uncertain in its success,
than to take the lead in the introduction of a new order
of things.”
- Nicolo Machiavelli
Self

Stages of Team Formation
- Members are - Intragroup - Group - Productive

enthusiastic conflicts harmony is collaboration
about the new - Team members restored - Members start
opportunity still do not see - Members start contributing to
- Interpersonal themselves as helping each their full
relationships a part of a other potential to
are established team achieve project
Self
goals

Timelines
Gantt chart is used to decide the timelines of the project. It depicts
➢ Activities in the project
➢ Start time of each activity
➢ Duration of each activity
➢ End time of each activity
➢ Progress as on date
Today
Week →
Phase 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Define
Measure
Analyze
Improve
Control

Critical Path Method
The Critical Path Method is the sequence of scheduled activities
that determines the duration of the project
Immediate
Activity Days
Predecessors
A None 5
B A 2
C A 3
D A 4
E B,C 1
F D 3
G E, F 1

Time Management
➢ List the tasks or activities to be performed
➢ Identify the resource responsible for the activity
➢ Obtain estimates of task duration
➢ Link the tasks with each other with sequencing rules
➢ Identify the critical path & determine the project schedule
➢ Compress timelines as appropriate
o Doing things in parallel
o Using different resources if necessary
o Increasing the priority of tasks with respect to other tasks
➢ On a weekly basis, check if the timeline is being followed
➢ Time management techniques:
o Publish agendas with time limits for each entry
o Adhere to the agenda
o Require pre-work by attendees
o Ensure that the right resources and people attend the meeting Self
o Creation of meeting minutes & update management on the timeline

Toll Gate Reviews
➢ Purpose:
o To monitor team progress
o Reinforce priorities – provide guidance
o Share best practices
o Assist team with any issues they may have
o Recognize and reward efforts
➢ Participants:
o Black Belt, Team members
o Project Sponsor
o Master Black Belt
o Other Key stakeholders
➢ Guidelines:
o Done at the end of each phase
o Minimize preparation by a team
o Send storyboard to reviewers a few days in advance
o Opening & closing by project sponsor

Summary
➢ Identify Project CTQs

o Obtain and interpret data from key customers for the product or process
o Identify the relevant business stakeholders
o Determine the problems to be addressed
➢ Agree on Project Charter & Obtain Approval

o Develop the project charter
o Revise the charter as the project matures
o Review charter with business stakeholders & obtain approval
➢ Develop a High-level Process Map

o Create a process map to identify your suppliers, customers, inputs,
outputs, and key process steps

OMEGA – Overview
Project &
Change
CTQ
Management
identification
Project DMAIC
Selection overview
Project Root Cause

Charter Analysis
Refresher Refresher

Definition of Root Cause
Root Cause
➢ Root Cause or a system of root causes is the underlying reason of a problem

which has the following two characteristics – PARADIES
o It is actionable
o Once actioned, it shall prevent the occurrence of a problem.
➢ Root Cause is a MIN process. Something that is either missing or

incomplete or not followed – IVAN FANTIN
M - Missing
I – Incomplete
N – Not followed.

5 Why Analysis
➢ Most common tool used for Root Cause Analysis

➢ Start with the problem and ask the 1st Why
➢ Continue asking ‘Why’ until you arrive at the root cause.
How do you identify that you have arrived at the root cause?
1. Is the cause actionable?
2. If actioned, will it prevent the problem from recurring?

5 Why Analysis Example
Problem – Car does not start Self

1st Why
Cause – Battery is dead Provided for self study
2nd Why
Cause – Alternator is not working
3rd Why
Cause – Belt is broken
4th Why
Cause – Belt beyond its usable life
5th Why
Cause – Scheduled replacement not done

6th Why
Cause – Car not serviced as per the plan

List all Potential Causes / X’s
Utilize one of the below tools to list all the potential causes
➢ Cause and Effect / Fishbone / Ishikawa Diagram
➢ Affinity Diagram

Cause & Effect / Fishbone / Ishikawa Diagram
➢ Helps identify potential causes to a problem in a pictorial format
➢ Format appears like the skeleton of a fish
➢ Developed by Kaoru Ishikawa in the 1960s, who pioneered quality
management processes in the Kawasaki shipyards
➢ Causes in a typical diagram are normally grouped into categories, the main
ones of which are:
o The 6 Ms: Men/people, machines, methods, materials, measurement,
mother nature (environment)
o 4 Ps – Places, Procedures, People, Politics
o 4 Ss – Surroundings, Suppliers, Systems, Skills
➢ Steps involved
1. Identify the problem
2. Work out the categories to be used
3. Brainstorm the causes leading to the problem
4. Analyze the diagram Self

Example 1: Fishbone Diagram
Self

Example 2: Fishbone Diagram
Measurement Man Material
Incoming QC Training Level

Raw Material
Measurement moisture variation
Method Skill Level
Measurement
Capability Adherence to procedure Multiple Vendors
Frequent staff
changes Reasons for
variation in
Moisture
Startup inspection Room Humidity Content of
Column Capacity
RM Supply in Market
powder
Handling Nozzle type
Purification Method Outside Temperature Dryer Temp
controller
Method Mother Nature Machine Self

Affinity Diagram
Is a tool used to generate ideas related to issues and then organizing these
ideas into logical categories basis their underlying similarity. Affinity diagrams
are useful for analysis of quality problems, defect data, customer complaints,
survey results, etc. They can be used in conjunction with other techniques such
as cause and effect diagrams
Steps involved in Affinity Diagram

1. Generate ideas: Brainstorming is immensely helpful in generating ideas
2. Display ideas: Write the ideas on small pieces of paper (Post-its work very
well).
3. Sort ideas into groups: To put an idea into a category a person simply picks
up the Post-it and moves it.
4. Create header cards: The final groupings are then reviewed and discussed by
the team. Usually, the grouping of ideas helps the team to develop a
coherent plan.
5. Draw finished diagram

Affinity Diagram Example
➢ Customer Requirements for design of clothes to wear for climbing (safety
gear)
o Safe ,Does not restrict movement, Fits over different clothes, Easy to
put on, Comfortable, Attractive, Accessible gear loops, Lightweight

Affinity Diagram Example: App based taxi complaints
Cab Wi-fi
Payment Driver related Connectivity
maintenance Safety issues
related issues issues issues
related issues
Fare higher than Accident during GPS not

Driver is rude AC not working working
estimated ride
Discount Unsafe AV
Longer route AV break down
coupon not experience disconnection
applied
Ride Cab unclean
Fare break up abandoned
unclear midway
Cab breakdown
Charged twice mid-way
Different car
Toll charged
incorrectly Different driver

Affinity Diagram Solution
What are issues associated with increasing attendance in professional
trainings?
Poor planning Objectives Work-load on Faculty Post- training

not clear participants issues
Last- minute Usefulness of No alternate Inappropriate No follow-ups on

information training not during absence knowledge feedback from
delivery defined participants
Respective No integration No concern/ load Internal faculty No accountability

bosses not with practical sharing by after the training
informed implications immediate boss
In- house venue Proposed Faculty not

causing participants informed in
interruptions are not the advance
doers

Interrelationship Diagram Example

Affinity diagram: Why does LSS initiative fail?

Inter-relationship diagram

Pareto Analysis
➢ Fishbone helps in listing of all causes.

➢ Pareto analysis helps in prioritizing the top few of them.
➢ Pareto analysis is a bar graph used to organize data in such a
way that shows what major X’s influence Y. It is frequently
referred to as “the search for significance”
➢ The basis for building a Pareto is the 80/20 rule. Typically,
approximately 80% of the problem(s) result from
approximately 20% of the causes
➢ An outcome of Pareto’s Analysis is Pareto chart
➢ What can go wrong when we use Pareto Analysis?

Practice Exercise 3: Weighted Pareto
➢ Weighted Pareto is a modified Pareto which helps in assigning weightages
to different defect categories thereby overcoming the limitation of a
normal Pareto where all defects are considered to be of same severity.
➢ The most common parameter used for weightage is the cost of a defect
but other parameters can also be used.
➢ Once the weightage is decided, the bar graph is plotted with the product
of weightage and frequency (instead of frequency alone) in the decreasing
order. Rest everything remains similar to a normal Pareto Chart.

Failure Modes and Effects Analysis (FMEA)
It is a structured approach to:
➢ Predict failures and prevent their occurrence in manufacturing and other
functional areas which generate defects.
➢ Identify the ways in which a process can fail to meet critical customer
requirements (Y).
➢ Estimate the Severity, Occurrence and Detection (SOD) of defects
➢ Evaluate the current Control Plan for preventing these failures from
occurring and escaping to the customer.
➢ Prioritize the actions that should be taken to improve and control the
process using a Risk Priority Number (RPN)
This enables us to evaluate current risks in the process and thereafter

developing an action plan to mitigate risks
It is developed and maintained by multi-disciplinary (or cross functional)

team typically led by the Green Belt/ Black Belt/Process Owner

FMEA Concept
Effect
Severity
Risk Action
Failure Mode Cause Priority Plan
Number
Occurrence
Control
Detection

FMEA – Draw connections
How How How How

Bad? Often? well? risky?
What can
What is the
What go wrong What are How can
Effect on What
is the with the the these be
the can be
Input Input? Causes? found or
Outputs? done?
prevented?

Types of FMEA
System Design Process

Components Components Manpower
Subsystems Subsystems Machine
Components Components Method
Material
Focus: Focus: Measurement
Minimize failure Minimize failure Environment
effects on the effects on the
Focus:
System Design
Minimize failure
Machines effects on the
Objectives/Goal: Objectives/Goal: Processes
Maximize System Maximize Design Objectives/Goal:
Quality, reliability, Tools,
Quality, reliability, Maximize
Cost and Workstations,
Cost and Production Lines,
Total Process
maintenance maintenance Quality, reliability,
Operator Training,
Cost and
Processes, Gauges
maintenance
Failure Modes and Effects
➢ The relationship between failure modes and effects is not

always 1 to 1
Failure Mode 1 Effect 1

Failure Mode 2 Effect 2
Failure Mode 1
Effect 1
Failure Mode 2
Effect 1
Failure Mode 1
Effect 2

Process FMEA
Customer Requirements
Deign Specifications
Key Product Characteristics
Machine Process Capability
Process Process Operator

Flow Process FMEA Control Job
Diagram Plan Instructions
Conforming Product
Reduced Variation
Customer Satisfaction

Process Map Analysis
A process map is a schematic model for a process. Many procedures are simply described
by word of mouth or may reside in documents that are obsolete. Process management,
often by simply trying to define and map the process, we provide a means for both
understanding and communicating operational details to those involved in the process. It
provides a baseline, or standard, for evaluating the improvement. In many cases, merely
defining and charting the process as it is can reveal many deficiencies such as redundant
and needless steps and other non value-added activities.
Process maps can be analyzed for : Self

✓ Time-per-event (reducing cycle time)
✓ Process repeats (preventing rework)
✓ Duplication of effort (identifying and eliminating duplicated tasks)
✓ Unnecessary tasks (eliminating tasks that are in the process for no apparent
reason)
✓ Identifying and segregating Value-added and non-value-added tasks

VA and NVA (Lean)
Value Added Activities must satisfy the following three criteria:
1. Work that the customer is willing to pay for
2. Work that physically transforms the product (or document/information)
3. Work that is done right the first time
Use the acronym CPR to remember: Customer pays for it, Physically transforms the
product, Right the first time.
Non value-Added Step:

• Is not essential to produce output.
• Does not add value to the output.
Non-Value-Added Steps can be further classified
1. Required NVA
Business necessity (e.g. accounting)
Employee necessity (e.g. payroll) Self
Process necessity (e.g. inspection)

2. Pure Waste/ NVA
Mnemonics to Remember
WORMPITS TIMWOODS DOWNTIME

W Waiting T Transportation D Defects
O Over Production I Inventory O Over Production
R Rejects M Motion W Waiting
M Motion W Waiting N Non-utilized Talent
P Over Processing O Over Production T Transportation
I Inventory O Over Processing I Inventory
T Transportation D Defects M Motion
S Skillset S Skillset E Extra-Processing
Self

VA/NVA analysis procedure
Step 1: Map the process like a flowchart detailing each activity, arrow and decision.
Step 2: For each arrow, box, and diamond, list its function and the time spent (in
minutes, hours, days) on the value-added check list
Step 3: Now become the customer. Step into their shoes and ask the following
questions:
o Is the customer not willing to pay for it?

Self
o Is this inspection, testing, or checking ?
o Is this just “fix it” error correction work or waste? Provided for self study
Step 4: If the answer to any of these questions is “yes”, then the step may be non-value-
added.
Step 5: How can activities and delays be eliminated, simplified, combined, or

reorganized to provide a faster, higher quality flow through the process?

APPENDIX

VOC: Critical to Satisfaction
The term VOC describes the expectations

and desires of a Customer
To identify what is critical to customer satisfaction, find out:

➢ Who are your customers? - current, lost, potential, and competitors’
customers
➢ What do you provide your customers?
➢ What is Critical to Satisfaction (CTS) for your customers as per their
expectation?
➢ What is the relative importance of the CTS(s)?
Self

What do customers want?
• Product or Service features, attributes, dimensions

Quality • Characteristics related to function of the product or service
• Purchase price, repair costs, financing terms

Cost • Maintenance costs, depreciation, residual value
• Lead times, delivery times, on-time commitment

Delivery • Response times to requests
• Service requirements, parts availability, courteous service

Service & • Warranties, product liability
Safety
Self

Customers crucial to business
VOC
Without a customer, there
Competition Environment is NO company…
Technology Market
…customers are critical

Vision to the existence of any
company.
Voice of the Customer
Business Strategy …If we don’t take care of

our customers, some one
Market Strategy else will.
Discover Growth Gain Competitive Build Loyalty

Opportunities Advantage
Identify Acquire Obtain Customer

Potential Customers New Customers Referrals
Self
Profitable Business Growth

Plan for VOC Data
Step 1
Identify information needed from Customers
Step 2
Develop research plan and questionnaire
Step 3
Collect Voice of the Customer (VOC)
Step 4 Self
Analyze VOC to Determine CCR


Step 1. Identify Information Needed Self
Decision Information Needed Data Needed

Should we Nature and extent of skill shortages that ▪Aided evaluation of current labor
offer more customers currently face shortage (scale response)
training to ▪Open-ended evaluation of how labor
customers’ or shortage impacts their business
make the
machines
easier to How do customers currently train and ▪Open-ended assessment of current
operate and develop their operators and service? training practices
repair?
Do customers believe there is an efficiency ▪Open-ended assessment of current
gap in their operations due to skill shortages, training practices
lacking machine capabilities, or both?
Level of customer interest in having ▪Aided and open-ended assessment of

Caterpillar provide more operator and manufacturer’s role in addressing this
service technician training shortage
What specific type(s) of training would ▪Aided and open-ended assessment of

customers like to receive? manufacturer’s role in addressing this
shortage
How much would customers be willing to Conjoint/discrete evaluation of training

pay for? options

Step 1. Identify Information Needed
➢ Aided-evaluation
o Scale response Self
o Quantitative data that can be analyzed statistically
➢ Open-ended evaluation
o Qualitative information where interviewer can probe for customer’s
perspective
o Classification of verbatim responses
➢ Trade-off methodology
o Conjoint analysis – helps identify value of specific features of total offering
o Discrete choice analysis – helps determine price customer is willing to pay for
specific features

Step 2. Develop Research Plan Self
Type Description Advantages Disadvantages

Focus Groups In-depth qualitative ▪ Broad amount of information can be ▪ Data is strictly qualitative so cannot
interviews with a small gathered in short time span be statistically analyzed
number of people ▪ Can identify key issues and explore ▪ Sample is not randomly selected nor
brought together to related but unanticipated topics representative of target population
discuss selected topics ▪ Does not require complex samples ▪ Quality of data is influenced by skills
of moderator
Face-to-Face Face-to-face interviews ▪ Provides opportunity to probe for ▪ Cost

Interviews to collect customer additional information ▪ Time required for interview
input to specific ▪ Provides qualitative and quantitative ▪ Potentially limits number of
questions (close-ended information respondents
and/or open-ended
questions)
Telephone Telephone interviews to ▪ Quicker and less expensive than ▪ Higher cost than mail or e-mail
Interviews collect customer input face-to-face interviews surveys
▪ Cost effective option if you need to ▪ Time required for interview by
probe for information respondent
Mail Surveys Mail surveys to ▪ Cost effective ▪ Potential low response rate
customers (may be ▪ Facilitates stratification of data ▪ No opportunity to explain question if
entire target population ▪ Promotes honest answers respondent does not understand
or sample) (respondents more likely to believe question
their answers will be anonymous) ▪ No opportunity for follow-up
questions

Step 2. Develop Research Plan
Type Description Advantages Disadvantages
Internet E-Mail surveys to customers ▪ Cost effective ▪ Some individuals in target population
Surveys (may be entire target ▪ Less intrusive and burdensome to may not have e-mail access so results
population or sample) respondents could be biased
▪ Higher response rates
▪ Timeliness
▪ Extremely good for internal groups
Listening Kiosks or other tools to ▪ Cost effective ▪ May not be effective in picking up
Posts monitor customer feedback ▪ Continuing feedback changes in customer requirements
on a continuing basis ▪ Obtain lots of responses quickly
▪ No data entry required
Observation Observations of customers; ▪ Provides real-life perspective ▪ Very expensive

usually done at customer’s ▪ No bias ▪ Time consuming
job site ▪ Hard to schedule
▪ No statistically valid measures
Self

Step 2. Develop Questionnaire
➢ Detailed questions are developed to explicitly provide the data needed to make the
business decision(s)
➢ Considerations in developing Survey/Interview Questions

o Need to ask the right questions
o Need to ask questions in the right way
• Avoid bias in the way you ask the questions; e.g. “Do you advocate a lower speed
limit to save human lives?” (Who will answer no?)
o Need to understand the answers
o Need to provide the right response scale
• 1 to 10 scale better than 1-5 or 1-7
• Typically too little variation in responses with reduced scale (Can’t do statistical
tests)
Self

Step 3. Collect the VOC Data
1. Train the interviewing team to ensure consistency
2. Pilot the questionnaire
3. Modify questionnaire as needed
4. Collect information from customers
Self

EXERCISE
➢ You want to do a survey to gather VOC data. Discuss the following within
your teams:
Self
o What’s wrong with a 3-point scale in a survey?
o What are some ways in which bias can creep into a survey? Provided for self study
o What’s wrong with the question “Do you use regular or premium petrol in your
car?
o In which survey method do you feel, the respondents will provide a more honest
feedback?
o What is the biggest problem/issue with using a mail survey or internet survey to
gather VOC data?

Step 4. Translate VOC to CCR
What is a Critical Customer Requirement (CCR)?
Self
➢ Important to the customer
o “Customer cares about it” Provided for self study
➢ Specifies requirement — “must-have” or “must be” attributes

o Ultimately satisfy customer
o Potentially delight customer
➢ Can be measured Tools to analyze Customer Responses:

Graphical:
Box Plots, Histograms
➢ Establishes a target Statistical:
Mean, Standard Deviation, 2-Sample
o Customer specifications T tests
Chi-Squared Tests, ANOVA
o Acceptable range of performance

Step 4. Critical Customer Requirements Self
Voice of the Customer Key Customer Issue Critical Customer

Requirement
Actual customer statements The real customer concerns, The specific, measurable
and comments which reflect values, expectations etc. expectation which a customer
their perception of product or regarding a product or has regarding a product or
service service. This statement is service
void of emotion or bias
The scooter is way too hard Customer wants the scooter • Scooter should start on the
to start to start quickly and painlessly first kick.
• The kick should be
effortless with a force of less
than 100 N.
I’m always on hold or end up Customer wants to talk to the • Customer reaches the
talking to the wrong person right person quickly correct person the first time
within 30 seconds

Glossary (1/5)
A B cont… C Cont… D
•Accuracy •Binomial Distribution •Coefficient of Variation (CV) •Defectives
•Activity Based Accounting •Black Noise •Common Cause •Defects
•Agile •Blockchain •Confidence Interval •Descriptive Analytics
•Algorithm •Bootstrapping •Confidence Level •Design For Assembly (DFA)
•Alternative Hypothesis •Bottleneck •Constraint •Design Risk Analysis (DRA)
•Apples to Oranges •Box plot •Continuous Data •Design of Experiments (DOE)
•Ansoff Matrix •Brainstorming 1 •Continuous Flow •DFMEA
•ARMI •Brainstorming 2 •Control Chart 1 •DFSS
•Artificial Intelligence (AI) 1 •Bubble Plot •Control Chart 2 •Discrete Data
•Artificial Intelligence (AI) 2 •Bullwhip Effect •Control Chart 3 •Discrimination
•Attribute Agreement Analysis •Burn Down Chart •Control Limits •DMADV
•Attribute Data •Burn Up Chart •Control Plan 1 •DMAIC 1
•Automation •Business Analytics •Control Plan 2 •DMAIC 2
•Autonomation •Business Excellence •CONWIP •DMAIC 3
•Correction •DMAIC 4
B C •Corrective Action •DMAIC 5
•Balanced Scorecard 1 •Capability Analysis •Correlation-1 •DPMO 1
•Balanced Scorecard 2 •Capability Index •Correlation-2 •DPMO 2
•Baseline •Capable Process •COPQ, Cost of Poor Quality 1 •Drum Buffer Rope approach
•Bathtub Curve •Cause •COPQ, Cost of Poor Quality 2
•Bayes' Theorem •Causation •Crashing
•Bells and Whistles •Central Limit Theorem 1 •Creativity & Innovation 1
•Benford's Law •Central Limit Theorem 2 •Creativity & Innovation 2
•Ben Franklin Effect •Central Tendency •CRM
•Bessel's Correction •Chaku Chaku •Crowd Intelligence
•Bias •Change Acceleration Process •CTQ
•Biased Sampling Error •Checksheet •Customer
•Big Hairy Audacious Goal •CLOSED MITT •Customer Satisfaction (CSAT)
(B.H.A.G.) •Clusters •Cycle Time

Glossary (2/5)
E F Cont… I L
•80:20 Rule •Fraud •IDOV •Law of Large Numbers
•8D Problem Solving •Fraud Detection •Industry 4.0 •Lead Time
•Effective/Efficient •Fraud Prevention •Instruction Creep •Lean
•Efficiency •Internal Rate of Return (IRR) •Lean Six Sigma
•Efficiency Metrics G •Internet of Things (IoT) •Lessons Learned
•Eisenhower Matrix •Gage R&R 1 •Internet of Things Security •Linearity
•Elevator Pitch •Gage R&R 2 Risks •Little's Law
•Emergency Response Action 1 •Gage R&R 3 •Inter Quartile Range •Logical Sub-grouping
•Emergency Response Action 2 •Gemba •Inventory
•European Foundation for •Genchi Genbutsu •Important vs Urgent M
Quality Management (EFQM) •Green Belt •Ishikawa Diagram •Management By Walking
•Evolution of Six Sigma •Groupthink Around (MBWA)
•Excellence •Guide to Hypothesis Test J •Mean Improvement
•Exponential Function •Jidoka •Measurement System Analysis
H (MSA)
F •Hammurabi Code K •Median
•5S •Handoffs •Kaikaku •Metrics
•False Alert, Missed Alarm •Hansei •Kaizen 1 •Mistake Proofing 1
•Fast Tracking •Hawthorne Effect •Kaizen 2 •Mistake Proofing 2
•Fault Tree Analysis •Herd Immunity •Kakushin •Mistake Proofing 3
•Filter Bubble •Heuristic Methods •Kanban 1 •Mixtures
•Fishbone Diagram •Hidden Factory •Kanban 2 •Monte Carlo Simulation
•First Time Yield •Hypothesis Testing 1 •Kano Model 1
•FMEA 1 •Hypothesis Testing 2 •Kano Model 2
•FMEA 2 •Hypothesis Testing 3 •Kaplan Meier Estimator
•FMECA •Hypothesis Testing 4 •Kappa Value
•Force-Field Analysis •Kendall's Coefficient
•Forecasting •KNOT Technique
•Kurtosis

Glossary (3/5)
N P Cont… P Cont… R Cont…
•Nash Equilibrium •Paynter Chart •Project •Rework
•Net Present Value (NPV)-1 •Personal Excellence •Prototype •Risk Priority Number (RPN)
•Net Present Value (NPV)-2 •PFMEA 1 •Pull System 1 •Robotic Process Automation
•Net Present Value (NPV)-3 •PFMEA 2 •Pull System 2 (RPA) 1
•Net Promoter Score (NPS) •PICK Chart •Purple Cow •Robotic Process Automation
•Nominal Condition •Pilot •Push System 1 (RPA) 2
•Nominal Group Technique •Planning Poker •Push System 2 •Root Cause
(NGT) •Point of Use Inventory •P-value •Root Cause Analysis 1
•Noninferiority Testing •Poka-yoke •Root Cause Analysis 2
•Non Value Adding (NVA)-1 •Power of a test Q •Rolled Throughput Yield
•Non Value Adding (NVA)-2 •Pre-Control Chart •Quality Assurance •R-Squared
•Normal Distribution •Prediction Interval •Quality Control •R-Squared Adjusted
•Null Hypothesis •Predictive Analytics •Quality Costs •Run Chart
•Prescriptive Analytics •Quantile Regression
O •Precision •Quick Win
•Observation •Preventive Action
•One Factor At a Time (OFAT) •Price Elasticity of Demand R
•Operational Definition •Process •RACI
•Operational Excellence •Process Capability •Range
•Optimal Stopping •Process Cycle Efficiency •RATER Model
•Oscillations •Process Excellence •Rational Subgrouping-1
•Outlier •Process Input/Process Output •Rational Subgrouping-2
•Process Mapping 1 •Regression Analysis-1
P •Process Mapping 2 •Regression Analysis-2
•Pacemaker Process •Process Maturity •Regression Testing
•Pareto Chart 1 •Process Stability •Reporting Bias
•Pareto Chart 2 •Product Limit Estimator •Resolution
•Pascal's Triangle •Productivity •Return on Investment (ROI)

Glossary (4/5)
S S cont… T V cont…
•6 Big Losses •Simpson's Paradox •Takt Time 1 •Variation Reduction
•6S •Single Piece Flow •Takt Time 2 •Visual Control
•Sample •SIPOC •Test of Equivalence •VOB
•Sample Size-1 •Sisyphus Effect •Theory of Inventive Problem •VOC-1
•Sample Size-2 •Six Sigma Solving (TIPS) •VOC-2
•Sample Size-3 •Skewness •Time Series •VOC-3
•Sampling •SMED •TIMWOOD •VUCA
•Sampling Error •Spaghetti Diagram •Tollgate Reviews 1
•SCAMPER •Special Cause •Tollgate Reviews 2 W
•Scatter Plot •Special Process •Trends •Wastes-1
•Scope Creep •Special Requirement •Tribal Knowledge •Wastes-2
•Scrum •Specification Limit •TRIZ •Waste Elimination
•Scrum Poker •Sponsor •Turing Test •Web Analytics
•Scrumban •Spread •Type I Error •Weighted Pareto
•Secondary Metric 1 •Sprint •Type II Error •WIFM
•Secondary Metric 2 •Stability •Will Rogers Phenomenon
•Segmentation •Stable Process U •Wisdom of the Crowds
•Sensitivity Analysis •Stakeholder •Unbiased Sampling Error •Work-Out
•Service 4.0 •Stakeholder Engagement •Unusual Observation •WORMPIT
•SERVQUAL Model •Standard Deviation •Urgent
•Seven Wastes of Lean •Statistical Significance
•Severity Ranking •Stop Gap Arrangement V
•Shojinka •Stop The Line •Validation
•Sigma Level-1 •Stratified Sampling •Value Adding (VA)-1
•Sigma Level-2 •SWAG •Value Adding (VA)-2
•Swim Lane Mapping •Value Stream Map (VSM)
•Verification
•Variance

Glossary (5/5)
X
•X
•Xbar-R
Y
•Y
•Y=f(X)
•Yield-1
•Yield-2
•Yokoten
Z
•Zero Defect
•Zipf's Law
Link for World’s Best Business Excellence Dictionary –

https://www.benchmarksixsigma.com/forum/business-excellence-dictionary-glossary/
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BENCHMARK SIX SIGMA

BLACK BELT PROGRAM

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 1

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 2

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 5

RAB ASQ Exemplar

Jan, 1989, Jan, 2005 Oct, 2013

RAB: Registrar Accreditation Board, USA

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 6

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 7

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 8

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 9

Omega Ω Iota, Ι Zeta, Z Epsilon, Ε Theta, Θ

Big Y to small y to root Metrics and

Measurement System Hypotheses and

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 10

Omega Ω Iota, Ι Zeta, Z Epsilon, Ε Theta, Θ

Big Y to small y, Root Metrics and

Measurement System Hypotheses and

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 11

Project Root Cause

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 12

➢ Top Management Support & Commitment

➢ Well Defined Project Selection Process

➢ Full Time Lean Six Sigma Leaders

➢ Business Improvement Process Framework

➢ Quantifiable and Measurable Results

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 13

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 14

➢ Communicate the need for change

➢ Change management tools

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 15

➢ Step 1: Increase Urgency

➢ Step 2: Build a Guiding Team

➢ Step 3: Get the Vision Right

➢ Step 4: Communicate for Buy-In

➢ Step 5: Empower Action

➢ Step 6: Create Short-Term Wins

➢ Step 7: Don’t Let Up

➢ Step 8: Make Change Stick

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 16

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 17

Key stakeholder Importance Current Commitment Recommended actions

Keep interacting with him. Try

Prod Planning Manager High High OK

Material control executive Low High OK

Financial representative Low Low Counsel him. Consult Finance Mgr.

In case of opposition or resistance, resolve it before proceeding further in the project

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 18

➢ Low Tolerance to Change

➢ Different Assessment of Situation

© Benchmark Six Sigma. Version 3.2 All Rights Reserved 19

o Inform & educate people of the change beforehand.

➢ Participation & Involvement

o Involve key stakeholders in the change process

➢ Facilitation & Support

o Be supportive of employees during difficult times

➢ Negotiation & Agreement

o Offer incentives to employees not to resist change