Six Sigma Black Belt Wk1 Define Amp Measure

Six Sigma Black Belt Program
Define & Measure phase
General Introduction
Objectives of Black Belt Training Why 6 Sigma in our organization? Benefits of 6 Sigma
Objectives of Black Belt training

To develop professionals in quantitative analytical skills, project management, group dynamics, team building and change management to address the organizational challenges. To build quality in to the systems to meet and exceed customer requirements.
Why 6 Sigma in our organization?

Overall strategy is to: Accelerate improvements in all processes and services by: - Identifying customer needs - Crafting a value proposition - Designing business models Reduce cost of poor quality by eliminating waste, reducing defects and variations To delight the Customers / Clients To Grow revenues, Sustain Margins, Improve revenue productivity, Grow human capital
Benefits of 6 Sigma
When the principles and methodologies of Six Sigma are properly applied in a business process, they return positive top line & bottom-line results. Some of the 6 Sigma Benefits are * Improved overall customer satisfaction * Increased productivity and added value * Improved capacity and output * Reduced total defects and cycle time * Increased product and service reliability * Improved process flow * Improved ROI
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Introduction to Quality
Fundamental Principles Quality Concepts
Aim So High Youll Never Be Bored

The greatest waste of our natural resources is the number of people who never achieve their potential. Get out of that slow lane. Shift into that fast lane
If you think you cant, you wont. If you think you can theres a good chance you will.
Even making the effort will make you feel like a new person. Reputations are made by searching for things that cant be done and doing them.
Knowledge
Skills
Attitude
Habit
Moving up the competency ladder

Unconsciously Competent
1. Unconsciously Incompetent 2. Consciously Incompetent 3. Consciously Competent 4. Unconsciously Competent

Consciously Incompetent Consciously Competent
4
Unconsciously Incompetent
2 1
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Quality Concepts
Quality
Simply stated, quality comes from meeting customer expectations. This occurs as a result of four activities: Understanding customer requirements Designing products and services that satisfy those requirements Developing processes that are capable of producing those goods and services Controlling and managing those processes so they consistently deliver to their capabilities.
Importance of Quality
Classical Business Model PROFIT = PRICE - COST Classical Quality Belief Better Quality Means: Six Sigma Approach Better Quality Means: Less Defects Less Reworks
Modern Technology
Modern Machinery High Skilled Resources In short BETTER QUALITY = HIGH COST In short
Less Buffer
Low Cycle Time
BETTER QUALITY = LOW COST
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Qualitys contribution to Profitability

Quality
Better products and services Improved processes
Customer Satisfaction
Compete with value
Market Share
External
Product Quality
Reduced Scrap Improved customer Response time
Price
Productivity
Decreased Cycle time Elimination of setup time
Internal
Profit
Process Quality
Reduced Rework Elimination of in process inspection
Cost
Opportunity for profit
Organization
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Typical Waste.
Wastes of Manufacturing Process
Defects Waiting Processing Over production Motion Inventory Transportation Under-utilization Safety hazards
Wastes of Service Industry

Defects
--- rework
Unsatisfied Customer
---Customer not satisfied, wrong input
Under-utilization of Resources
--- Poor usage of infrastructure , manpower
Over- Processing
--- Over-support to customer ,unwanted information
Redundant Process steps

--- Wrong processes / methods
Wastes Kill .. Business and Profits

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Cost of Poor Quality

Inspection Warranty
Traditional Quality Costs

(Easily Identified) 4~ 6% of Sales
Rejects Rework (tangible) (tangible) Scrap
Lost sales
Additional Costs of Poor Quality

(Difficult or impossible to measure)
Long cycle time Late delivery
25~35% of Sales
(intangible) (intangible)
Lost Customer Loyalty Excess inventory Expediting costs
Lost Opportunity
Lost Opportunity
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Cost of Poor Quality (COPQ)?
Costs incurred due to product or process quality not meeting the customer requirement all the time.
Costs that would not exist if there were no defects.
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Cost of Quality Categories

Internal Failure Costs - costs that would disappear if no defects existed in the product prior to shipment to the customer. External Failure Costs - costs that would disappear if no defects were shipped to the customer. Appraisal Costs - costs incurred to discover the condition of the product (during first pass through). Prevention Costs - costs incurred to keep failure and appraisal costs to a minimum.
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Internal Failure Costs

Before shipment to customer
Examples Scrap (labor and material) Rework Retest / Recheck/ Re-inspection / Re-testing Productivity loss due to defects Excess inventories Failure analysis 100% sorting inspection
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External Failure Costs

After shipment to customer
Examples
Lost business Warranty Dealing with complaints Returned product Price concessions due to lower grade product
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Appraisal Costs
Examples
Maintaining test equipment
Quality audits / Transaction Monitoring Materials consumed through destructive testing Incoming, In process & Final inspection & testing Quality system audits Inspection & testing of materials & services
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Prevention Costs
Examples
Maintaining production/operations equipment Process Control & Capability evaluation Process improvement: -Error proofing -FMEA -DOE Training
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Evolution of Quality
1980s: Six Sigma
1960s: Japanese Quality Movements
1940s: Statistical Process Control
1920s: Invention of Control Charts by Walter A. Shewhart, Bell Labs

Each Phase Built on the Structure and Gains From the Previous Phases
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DEMINGS Philosophy
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Demings 14 points for Quality Management (Principles of transformation)

1. Create constancy of purpose for continual improvement of product and service. : Replace short-term reaction with long-term planning.
2. Adopt the new philosophy for economic stability. 3. Cease dependency on inspection to achieve quality. : If variation is reduced, there is no need to inspect manufactured items for defects, because there won't be any. 4. End the practice of awarding business on price tag alone. 5. Improve constantly and forever the system of production and service. : Constantly strive to reduce variation. 6. Institute training on the job. : If people are inadequately trained, they will not all work the same way, and this will introduce variation.
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Demings 14 points for Quality Management

7. Adopt and institute modern methods of supervision and leadership.
8. Drive out fear. Deming saw management by fear as counter- productive in the long term, because it prevents workers from acting in the organization's best interests.
9. Break down barriers between departments and individuals. : The concept of the 'internal customer', that each department serves not the management, but the other departments that use its outputs.
10. Eliminate the use of slogans & posters : Another central TQM idea it's not people who make most mistakes - it's the process they are working within. Harassing the workforce without improving the processes they use is counter-productive
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Demings 14 points for Quality Management

11. Eliminate numerical quotas. : Deming saw production targets as encouraging the delivery of poor-quality goods. 12. Remove barriers that rob the hourly worker of the right to pride in workmanship. : Many of the other problems outlined reduce worker satisfaction.
13. Institute a vigorous program of education and retraining.

14. Define top managements permanent commitment to ever-improving quality and productivity.
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Introduction to Six Sigma
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Introduction to 6 Sigma
Six Sigma History Success Stories Definitions and Drivers 6 Sigma : What Makes It Different? 6 Sigma : Meaning
6 Sigma : Benefits
6 Sigma : The Organization
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Six Sigma History

In 1979 during a executive meeting, Motorola engineers stated The real problem at Motorola is that our Quality stinks
They had data confirming 10 - 20% of annual revenues was spent on correcting poor Quality, costing the company 800 - 900 million US $ PA
To get rid of this problem Motorola came up with Six Sigma Breakthrough strategy.
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Motorola
And the Results?

1997
5.6
Products Manufactured
~ 16 Billion
1986
4.2
In 1988 Bob Galvin (CEO Motorola) while accepting first Malcom Baldrige National Quality Award for Motorola, described about something called as Six Sigma.
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Six Sigma History

Since then, hundreds of companies around the world have adopted Six Sigma as a way of doing business.
Six Sigma is a Structured, Project based approach to achieve BREAKTHROUGH results, leading to sustainable and significant FINANCIAL impact on our organization through intensive application of statistical tools and techniques by our people.
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Success stories - General Electric General Electrics, Jack Welch describes Six Sigma as the most important initiative GE has ever undertaken. GE had an operative income of 10% for decades and they were not able to improve this despite various efforts. After implementation of Six Sigma GE was able to improve its operative income from 10% in 1995 to 16.7% in 1998.
As Jack Welch explains it: The best Six Sigma projects begin not inside the business but outside it, focused on answering the questionhow can we make the customer more competitive? What is critical to the customers success? . . . One thing we have discovered with certainty is that anything we do that makes the customer more successful inevitably results in a financial return for us.
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Asea Brown Boveri
ABB, after application of Six Sigma has reduced

measurement equipment error by 83%. The company also made drastic improvements in material handling resulting in an annual estimated cost savings of US $775000.
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Allied Signal
Allied Signal, which was on the verge of

bankruptcy was made profitable by CEO Larry Bossidy through Six Sigma. The company implemented Six Sigma program in 1994. The cumulative impact on the savings in the direct costs during this period was more than US$ 2 billion.
Allieds leaders view Six Sigma as more than just numbersits a statement of our determination to pursue a standard of excellence using every tool at our disposal and never hesitating to reinvent the way we do things.
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A Six Sigma Journey 1987 to 2006
Over the past few decades six sigma has evolved from a focus on defects to cost reduction to value creation.
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Companies Implemented 6 Sigma Worldwide

Dupont Sony Black and Decker Kodak Microsoft
GE
Allied Signal
Motorola Corporation Ford Federal Express IBM Johnson and Johnson American Express Citibank Johnson Controls Caterpillar
Toshiba
Asea Brown Boveri
Texas Instruments
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Definition & Drivers

6 Sigma
A comprehensive and flexible system for achieving, sustaining and maximizing business success
6 Sigma Drivers
Close understanding of customer needs Disciplined use of facts, data, and statistical analysis Diligent attention to managing, improving, and reinventing business processes Six Sigma - A concept for Quality improvement
The Goal of Six Sigma is not to achieve six sigma levels of quality. It is about improving profitability, though improved quality and efficiency are the immediate by-products of Six Sigma.
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Definition of Quality as per Six Sigma

Quality is a state in which value entitlement is realized for the consumer and the provider in every aspect of business relationship.
Entitlement for companies means that they have rightful expectation to produce quality products at the highest possible profits. Entitlement for customer means they have a rightful level of expectations to high-quality goods at the lowest possible cost.
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6 Sigma : What Makes It Different?

Six Sigma metric provides a standard for communicating process status and improvement goals. Project selection tied to organizational strategy / balanced scorecard Customer focused / proactive vs. customer driven / reactive. Project outcomes / benefits tied to financial reporting system. Recognition and reward system established to provide motivation. Executives and upper management drive the effort through: Understanding Six Sigma. Significant financial commitments. Actively selecting projects tied to strategy. Setting up formal review process. Selecting Champions. Determining strategic measures.
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Six Sigma v/s TQM and ISO

ISO
Focus on Money Leadership & Top-Down Support
TQM
Six Sigma
Continuous Improvement
Deployment Strategy & Guidelines Measurement Criteria of Quality Goals Performance Targets Application of Statistical Tools Quality Career Path Extension to Cost, Cycle Time & Other Business Issues Integration of Business Goals with Quality Functional Focus Project Approach 38
6 Sigma: Meaning
Reduce Variation to the half of Tolerance Band Minimize defects to the level of 3.4 defects per million opportunities
6 Definition
It is a Greek term which

designates the spread or distribution about the mean of any process.
LSL
Defect !
USL
LSL
Defect !
USL
Precise But not Accurate: Not Accurate Not Precise Process is off target : High variation in the process
It is a metric that indicates how well the m o ni to r e d b us i n es s process performs. Higher the no., better t h e p r o c e s s .
Six sigma tool tries to reduce variation in the process and shifts process mean towards the target
LSL
USL
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Example 1
Time taken to process order - Advisor A
USL
45 44 43 42 41 40 39 38 37 36 35 1 2 3 4 5 6 Order no.
Time in Minutes
Process mean is 40 40
LSL
10
40
Time taken to procees order - Advisor B 45 44 43 42 41 40 39 38 37 36 35 1 2 3 4 5 6 Order no

USL
Time in Minutes
Process mean is 40 40
LSL
10
41
Time taken to process order - Advisor A & B

45 44 43 42 41 40 39 38 37 36 35 USL
Time in Minutes
40
A
1 2 3 4 5 6 7 8 9
LSL 10
Order no
Which Advisor will you prefer ?

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6 Sigma Goal
From Fixing products and services to become acceptable
The Goal
To Optimized processes that produce defect free products and services
Quantum Leap
Before 30 20
After
Influence of 6 Sigma
10
0 0 10 20 30 40 50 Process before and after Six Sigma

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A Six Sigma Landing .

Target USL
LSL
Six Sigma is about on target performance with reduced variability around the target
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Understanding
Sigma Level
Consider 10,00,000 (1 Million) planes take off per year. The plane crash resultsat each Sigma Level will be as follows
2 sigma 3,08,537 Planes per year 3 sigma 66,807 4 sigma 6,210 5 sigma 233 6 sigma - 3 Planes per year planes per year Planes per year Planes per year
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Sigma Level and Quality

Defects Per Million Opportunities 691,462 308,507 66,807
Sigma Level
1 2 3
% Defects
69 % 31 % 7%
4
5 6
6,210
233 3.4
0.6 %
0.02% 0.00034%
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Six Sigma Process

Predictably twice as good as what the customer wants 6
LSL
-6 1
+6
USL
10 11
12
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Sigma
A measure of variation from target.
LSL
USL 1 Std. Dev. / 1 Sigma
One standard deviation around the mean is about 31% of the total opportunities included with in specification limit.
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If we can fit six standard deviations on both side of the mean in between our target and the specification limits . . .
LSL 6 5 4 3 2 1 1 2 3 4 5 6
USL
6 Std. Dev. / 6 Sigma
.. then 99.99966% of our opportunities are included!
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6 Sigma : Benefits
Cost reduction Generates sustained success Sets a performance goal for everyone Enhances value to customers Accelerates the rate of improvement Promotes learning Executes strategic change Productivity improvement Market-share growth Customer retention
Cycle-time reduction
Defect reduction Culture change Product/service development And many more.
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6 Methodology
f(X)
Focus of the 6 Approach of Problem solving
Which one should we focus on the Y or X?
Y
Dependent Function Output Effect Symptom Monitor
X1,.,Xn
Independent Variable Input Cause Problem Control object
6 Application assures that problem is solved by focusing on the factors that cause the problem.
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Lets Avoid This Situation !

If we dont know the relationship between the Output (Y) and the Inputs (Xs) all we can do is to monitor and sort the good from the bad Ys. And Pray Hard that Y will turn out good !
Or
Implement Six Sigma ...
It discovers relationships between Y & Xs
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Y = f (X)
Everything has a cause. Cause influences the effect
Focus on the cause (x) to change the response
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Pr = f (V)
Problem is any deviation from the defined standards of a distinguishing feature.
Focus on source of variation to eliminate the problem
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V=E-O
Variation is the gap; A deviation from the expectation
Measure the variation. We cant improve what is not measured.
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Continual Improvement
Continual Improvement
Performance
act plan act do check do check do
6 / ISO / COPC / e-SCM Performance Management System
Assurance
Time
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Six Sigma Organization, Roles and Responsibilities
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Six Sigma Organization

Six Sigma focuses on reducing the variation in every process , makes intensive use of the statistical tools, enables decisions based on facts & data rather than gut feelings and puts customer in first place . Every improvement we are doing in house must be ultimately linked with the customer satisfaction whether it is internal or external . There must be strong and clear linkages between the internal processes, which ensures the end customer satisfaction . To transform our organization into Six Sigma organization , we must ensure that six sigma is used as a philosophy / strategy and not a tool . In an essence , It's a new way of managing the enterprise .
6 Sigma : The Organization
Leadership
Commitment at Executive Level

Governance Review,Enable,Monitor,Institutionalise e.g. Quality leaders, Master Black Belts etc. Implementation Scope, Apply Six Sigma Tools And Enhance Business Processes e.g. Project sponsors, BU Managers, BB, GB, YB who apply Six Sigma on-the-job
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Six Sigma Deployment Model

Deployment Champion / Top Management
Link Six Sigma to overall business strategy Creat Customer Feed back process Determine strategic goals and objectives Allocate appropriate resources Develop incentive plan & reward system Establish accountibilit y in annual performanc e reviews
Ispat Industries Ltd. Six Sigma Deployment Process
Creat a core six sigma leadership team with defined responsibilit ies
Extend the initiative in other group companies
Design and implement six sigma deployment
Creat an overall training plan
Design training Material & Periodic updates
Define a project selection process & criteria
Establish project review & project trac mechanism
Define a project validation & project closeout process .
Evaluate cultural obstacles & raise red alerts to manageme nt
Design a common database of closed projects & key learnings
MBB / Six Sigma core team
Compile the lessons learned & share best practices .
Identify opportunities for breakthrough improvement
Identify appropriate project leaders & arrive at cross functional team
Ensure resource availability for project execution
Review the team progress, remove barriers and resolve issues
Appreciate and recognize good efforrts. Motivate project team
Ensure controls are in place and project gains are sustained forever .
Project Champion / BU Managers
DEFINE the project. Pboblem statement, Objective, Scope, Team, Timeline
MEASURE the response variable Y. Baseline, Target, MSA
ANALYZE the negative effect. Identify root causes(X's) & verify statisticaly
IMPROVE peroformance ( Y's) by implementing the counter solutions for X's
CONTROL the KPIV's to sustain improved Y. Control plan, Control chart etc..
Black Belt / Green Belt / Project Team
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Organization / Infrastructure
Senior executive who sponsors the overall Six Sigma Initiative and who is responsible for implementing Six Sigma within the business. Select meaningful business impact projects. Responsible for achieving Six Sigma project results. Identify, prioritize, select & scope projects. Review, track, and report Six Sigma project progress and results. Eliminate project barriers, assure proper project resources. Reward, recognize Six Sigma project team Achievements.
Mentor black belts on their projects. Ensures effective application of DMAIC. Coach on appropriate, effective use of Six Sigma Tools & effective project management to achieve on-time results. Helps sponsor in improvement opportunity identification. Apply Six Sigma skills and expertise to their own Projects. Train BBs, Sponsors and Managers in Six Sigma. Highly experienced person with four weeks of classroom training, has managed several projects and is an expert in Six Sigma methods / tools. Organize, plan and lead Six Sigma projects. Escalates project barriers to sponsors. Project tracking, reporting. Apply Six Sigma skills and expertise to project execution. Responsible for coaching / mentoring / training Green and Yellow Belts, team members and for helping the Sponsor keep the initiative on track
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Sponsor
Master Black Belt
Black Belt
Organization / Infrastructure
Project leader
Understand DMAIC Process and Sustain Improvements. Provide domain / Process expertise. Accountable for timely completion of projects. Support improvements. Identifies project team and ensures their availability.
Green Belt
Professional who leads small scope Six Sigma projects. Typically has one week of classroom training in methods, statistical tools, and (sometimes) team skills, participates in Black Belt project team or leads smaller projects.
Typically has two days of classroom training in methods and basic statistical tools, participates on a Green Belt project team or leads smaller improvement projects. Professional who has general awareness of Six Sigma. (through no formal training) and who brings relevant experience or expertise to a particular project. Apply Six Sigma tools with help of Black / Green / Yellow Belts Contribute ideas during meetings and carry out action items. Collect and analyze data Lead small activities such as process capability studies, measurement system studies, verifying causes and solutions. Implement and sustain solutions.
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Yellow Belt
Team Member
Six sigma Roles

Black Belt
Organize, plan & lead Six Sigma projects Project barrier escalation to sponsors Project tracking & reporting coaching / mentoring / training Green & Yellow Belts, team members
Green Belt
Participates in Black Belt project team. Leads smaller projects
Team Members
Bring expertise to projects Contribute ideas during meetings and carry out action items Collect and analyze data Lead small activities Implement & sustain solutions
Yellow Belt
Leads smaller improvement projects
Master Black Belt

- Mentor black belts on their projects - Ensures effective application of DMAIC - Helps sponsor in improvement opportunity identification - Apply Six Sigma skills & expertise to their own projects - Train BBs, Sponsors & Managers in Six Sigma
Sponsor
- Sponsors the overall Six Sigma initiative - Select meaningful business impact projects - Eliminate project barriers, assure proper project resources. - Reward, recognize Sigma project team achievements
Project Leader
- Understand DMAIC Process and Sustain improvements - Accountable for timely completion of projects - Provide domain / Process expertise - Support improvements. Identifies project team and ensures their availability
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Champion or Sponsor
Requirements
Representative of Top Management Has Authority over the scope of project Statistical Knowledge is preferable
Responsibilities
At Start: * Identify the Goals of the Project * Select the Project Leader or Black Belt * Ensure the Project Scope is under his control * Identify Milestones * Prepare Project Schedule
Experience in carrying out Quality improvement Projects is preferable
On Going: Provide Resources Conduct Periodic Review & add value Ensure the Project is on Right Track Control Budget At End: Handle Implementation Issues Quantify the Project Results Verify whether the Goals are achieved Prepare Future Action Plan, if required Conclude Project
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Master Black Belt

Requirements
Sound knowledge of Statistical Tools are required
Good Communication & Teaching Skills are essential Should be a Good Consultant
Responsibilities
At Start: Create Six Sigma awareness among top management Provide guidance & training for gathering Voice of Customers & Stakeholders Help to identify projects Provide guidance to prepare Project Charter
On Going: Provide training on various Statistical Tools useful at different phases of the project life cycle Give Statistical Consultancy at different phases of the project life cycle
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Black Belt
Requirements
Statistical Knowledge essential Experience in Data Collection, Analysis & Interpretation required Should posses Leadership Qualities Should posses Good Communication Skills
Responsibilities
At Start: Select Team Members Prepare Project Charter Identify Ys On Going: Analyze Ys & compute Baseline Sigma Value Identify Xs Establish relationships between Ys & Xs Optimize Xs Devise Control Mechanism to ensure that Xs are at optimum always.
At End: Be equivalent to Master Black Belt. Conducts programs on Statistical tools Facilitates Business Unit Head for project selection
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Green Belts \ Team Members

Responsibilities
On Going: Collect data on Ys Help BB to analyze Ys data. Be part of identifying Xs Collect data on Xs Help BB to establish relationship between Xs &Ys Help BB to optimize & control Xs Help design the new process Drive the project to completion
At End: * Green Belt will be equivalent to Black Belt
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Team Members
Guidelines for team members Manageable team size up to 5 people People who are part of the process People who are benefited by removal of pain area
People who have domain knowledge

People from same location Guest members as required
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Project Teams
Champion
Black Belt
B
Green Belt
G
Team Members
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Team Dynamics
Skills
Problem Solving Technical/ Functional Interpersonal
Accountability Performance Results
Mutual Accountability Small group of people Individual Accountability
Specific Goals Common Approach Meaningful Purpose
Commitment
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Deployment Strategy
Elements of 6 Sigma Deployment Role Matrix Training Certification Criteria Project Classification
Project Benefits Evaluation
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Elements of 6 Sigma Deployment

1.Project Identification To contribute to the bottom-line of the organization, client satisfaction, etc
6. Fostering Quality Culture

Branding Yearly Awards dedicated facilities and staff
2. Project Classification
Black Belt Project Green Belt Project Yellow Belt Projects
Six Sigma is being implemented in the organization as a catalyst for change in culture and achieve competitive advantage. DMAIC methodology is being used to develop and fine tune both core and enabling processes. Six Sigma Deployment plan is properly documented as PACE guidelines.
5. Project Benefits Evaluation

Project Benefits (QNI) = Project Savings Project Expenditure
Top Management Commitment
3.Enhanced Training and certification

Awareness Program Yellow Belt Training Green Belt Training Black Belt Training
4. Review Mechanisms
Program Reviews Project Reviews
commitment for Six Sigma and Champions/ Sponsors are the most powerful success factors
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Team Structure - Role Matrix

Role Description Training Curriculum preparation and implementing improvements as per recommendations Preparing the Training Calendar Identifying the Trainers Certifying the Trainers Defining the Selection Criteria and improving the same on an ongoing basis Identifying the Trainees Selection of Projects based on ongoing experience and Business Goals Sponsor for the Project Project Management / Coordination Project Execution Project Certification Review of training material Quality Team Operations / Support Team HR Team SS Executive Committee (EC)
Respective BB / GB / YB
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Types of Training
Awareness Program The program will be of a 4 Hrs duration. This is engagement specific and will be conducted internally by the dedicated certified trainer. Yellow Belt Training Two continuous days as stipulated in the program calendar Green Belt Training Five Days program spread over 3 months (2days + 2days + 1day) as stipulated in the program calendar Black Belt Training 20 Days program spread over 4 months, 5 continuous days every month as stipulated in the program calendar. For YB/GB/BB trainings all trainees are expected to be fully available during the training period
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Certification Criteria
All trainees would need to attend a 2 day YB session/ 5 day GB session / 20 days BB session & pass the respective certification examination. Qualifying mark would be 70% for YB, 75% for GB & 80% for BB Project Certification will be granted to the BB, GB and YB identified and dedicated for the particular project Certification will be done internally by the Certification Board. The criteria for certification will be Complete training Pass the examination Meet any of the options as mentioned in the next page.
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Certification Criteria
1 2 3 4
OPTIONS 5
Black Belt Certification
Green Belt Certification

Black Belt Project Leader Green Belt Project Leader
Yellow Belt Certification
Yellow Belt Project Leader Yellow Belt/ Green Belt/ Black Belt Project Member 76
Project Classification
IMPACT
Green Belt Yellow Belt

Complexity
Black Belt X
Black Belt Projects
Projects that have cross functional scope and are of high impact and complexity with respect to NET revenue earnings / NET savings. (Expected savings $ 50,000/ annum min). Should complete within 4 to 6 months Base line, target and savings should be validated by Financial representative
Green Belt Projects

GB projects are less complex than BB projects. (Expected savings $10,000-$ 50,000/ annum) Should complete within 2 to 4 months Base line, target and savings should be validated by Financial representative
Yellow Belt Projects

YB projects are Cell wise projects, where cross functional team is not required and very limited statistical knowledge required to carry out the project This projects are taken as value addition to GB projects. YB projects by themselves do not generate / save revenue.
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Project Benefits Evaluation

Hard (Tangible) Benefits Soft (Intangible) Benefits
Definition: Any measurable Improvement which cannot be quantified and converted into Dollar Savings.
Examples:
Increase Customer Satisfaction Scores Improve VOC Scores Improving Federal / State regulatory Compliance Scores
Definition: Any measurable Improvement which can be Quantified and converted into Dollar Savings. Examples:
Reduction of 3 FTEs 1% market share Increase Eliminate 2 Temporary Positions Rework down 20% Lower vendor cost per transaction Save 1 temp. worker 2 hrs of work per week Eliminate 30% call volume Decrease AHT of the process by 60 secs Reduction in past due receivables by $10MM
Project Benefits (QNI) = Project Savings Project Expenditure

1. 2.
3.
Project Charter will include Sign-off from Finance Analyst Project validation / authentication is done by Sponsor, Head Quality and Finance Dept. The return on the project is verified. Only upon successful completion of the project, the respective BB will be eligible for certification.
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Six Sigma Project Identification and Selection
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Project Identification & Selection

Project Selection approach Project Sources and Selection Criteria Kano Model CTQ Tree Quality Function Deployment
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Project Selection Approach

Steps
What is the process ? Who are the potential customers ( Internal, External, Business owners) What are the process deliverables ? What is the Unit of Measurement ? Is Measurement System in place ? What is the Current Performance (Baseline) ? What is a expected / targeted performance ? Does gap exists ? Does gap carries significant impact to customer / business ? Identify the improvement approach Continuous Improvement OR Re designed ?
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SS Project Selection Approach Identifying Critical processes

Approach Steps Tools
Business Process Framework
Approach Description
One of the Business / Functional unit (e.g. Operations / Purchase Process flow steps
Business Unit
Business Process
Process Flow Chart Customer Surveys Brain storming Prioritization Step I Step II
Step III
Step IV
Step V
Step VI
Step VII
Identify Critical Process
Study Process
High level process mapping
Study the critical process and the pain areas identified during customer survey
Identify Customers
SIPOC
Identify External & Internal (Business Owner & other functions) for the critical process
List out Customer Expectations/Deliverables
SIPOC
Categorize the customer expectations (VOC / Pain areas) from critical process obtained form from surveys in to Deliverables of Quoting process
Does Process Exists? Yes
No A
Sub Process Flow Chart
For each deliverable of critical process identify If the sub process or product / service feature exists
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Six Sigma Project Selection Approach (Contd.)

Approach Steps
A Are Metrics in place? Define Metrics & implement data collection plan
Tools
SIPOC Data collection checklists Dashboard Enterprise Performance Management Matrix Process Capability
Approach Description
For each deliverable of critical process identify unit of measure & measurement system
Ensure that the critical process metrics are linked with Business objectives, Strategy & VOC
Validate the Metrics
Collect data for all critical process metrics to define baseline process performance
Process Base lining
Control Charts Conduct a gap analysis between the critical process baseline performance and targeted / customer expected performance level Process Performance Enhancement Apply DMADV / Process Re Engineering implementation 1. 2. DMAIC DMADV Re Design / Re Engineer Problem Solving Approach If the sub process exists for a metric / feature apply DMAIC for long term approach OR Problem solving approach for Quick wins for early realization of improvements where solutions are known If the sub process does not exist for a metric / feature apply DMADV or Process Re Engineering Approach.
Does Gap Exists? Yes Does Process exists?
No
Explore need of performance excellence
B No
Yes
Long Term Approach Apply DMAIC Quick wins Apply REIS
3. 4.
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SS Project Selection Approach

Identifying Undesirable Conditions
1. Identify the undesirable business process conditions. (Customer complaints, VOC, Quality reports, Monthly performance indicators) 2. Quantify the undesirable conditions in to Defect (%, PPM, DPMO, Sigma level) or Cost . 3. Identify the potential causes for the undesirable conditions. (High level process map, C & E analysis, Pareto analysis) 4. Arrive at the vital few potential causes and prioritize . (NVA's, Multivoting, 80:20 principle )
5. Identify the business process to which each prioritized suspected cause belongs to .
6. Select the core or enabling process for improvement, quantifying the gap between current performance and what customer wants (Process Deliverable).
Six Sigma Project 1 Define
Six Sigma Project 2 Define
Six Sigma Project N Define
Appl y...
Measure
Measure
Measure
Analyze Improve
Analyze Improve
Analyze
Improve
Target : Reliable (Stable & controlled) processes, Satisfied Customers, Happy Employees
Control
Control
Control
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Improvement Methodology Selection

Process Improvement
Product / Process Development : Where a sub process does not exist to take care of the customer requirement
Product / Process Performance Enhancement : Where the sub process exists but unable to meet the customer requirement with current process performance level
Product / Process Metric monitoring : Where the tentative solutions are known and systematic execution is required to ensure the Improved process performance & sustenance
DMADV (Define, measure, analyze, design and validate)
DMAIC (Define, measure, analyze, improve and control)
REIS (Recognize, evaluate, implement and sustain)
Design processes that do not exist for e.g. knowledge management
Enhance process metrics e.g. turnaround time, customer problem resolution effectiveness etc
Monitor and reduce errors in the process e.g. ineffective call close etc
85
Six Sigma DMAIC Project Flow

Define Tollgate Measure Tollgate Analyze Tollgate Improve Tollgate Control Tollgate
D
Define Define
Step 1: Identify customer & their care abouts. Covert their needs in to Critical to Satisfaction (CTS) i.e. CTQ Critical to quality, CTC Critical to Cost & CTD Critical to Delivery. Step 2: Develop Project Charter
M
Measure Measure
Step 3: Take the snapshot of the process, how the process performing currently & fix the baseline. Step 4 : Validate the measurement system from which we collect the data.
A
Analyze Analyze
Step 5: Identify the key process input variables that affects the outputs most. Step 6 : Verify the identified causes to see whether those are real or not.
I
Improve
Step 7: Determine the solutions to optimize the output & eliminate / reduce defects & variations. Step 8 : Implement the solutions partly & statistically verify their impacts on output.
C
Control
Step9 : Put the control in place to sustain the gains made by the process improvement. Step 10 : Integrate in daily work by Process Owner & team
Phase Deliverables
Required List of Project CTQs QFD/CTQ Tree Project Charter SIPOC Tools Box Project Risk Assessment Stakeholder Analysis High Level Project Plan In Scope/Out of Scope Customer Survey Methods (focus groups, interviews, etc.) Required Process Baseline capability Operational definition, Specification limits, target, defect definition for Project Y(s) Measurement System Analysis Tools Box Benchmarking Data Collection Plan Gage R&R Process Map FMEA Pareto Analysis Required Data Normality Test List of Statistically Significant Xs . List of vital few Xs & their verification Tools Box RCA / Fishbone Diagram Hypothesis Testing Correlation & Regression Analysis Required Optimization of Xs Improvement verification Tolerances on Vital Few Xs Required Post Improvement Capability Improvement tracking Process Control Plan Process Owner Signoff
Tools Box Design of Experiments Improved Process Maps FMEA on new process
Tools Box Control Charts Control Plan Hypothesis Testing Error Proofing
86
Six Sigma DMADV Project Flow
87
Problem Solving (Quick Win) Project Flow
88
Project Sources and Selection Criteria
Sources of Project Generation

C-Sat / V-Sat Short Term / Long Term Organizational Goals (Business and operations) Service Level Transaction Quality Resource Utilization Engagement Targets client complaints etc
Six Sigma Project Selection criteria

Business Filters
contribute to bottom-line of the organization Drastic, long term, risk free Improvement Solution Not known No other teams working on project
Project Filters
Availability of Data Measurable Time bound Realistic and Attainable
89
Customers Perception
Project identification begin not inside the business but outside it Focus on answering the following questions: * How can we make the customer more competitive? * What is critical to the customers success? Anything we do that makes the customer more successful inevitably results in a financial return for us. Kano Model is one of best technique to collect and understand Voice of Customer (VOC)
Business and operational goals can be analyzed by CTQ Drill down or Quality Function Deployment
90
Customers
Who is a customer? One who is paying for your service or product a person who buys goods or services
Types of customers External or internal Lost customers Prospective customers
91
What do customer & shareholders want?

What do customer wants?
Utility:They buy product or service for a need Time : They want it when they need it Value : They pay for it only if they perceive a value
What do shareholder wants?
The business must successfully serve the customers Wants and Still provide good profits.
92
Kano Model
CUSTOMERS WANTS
Must Be
Satisfiers
Delighters
Delighters
No penalty for not doing them However, if you do them, you get bonus points
Satisfiers
The better we do, the happier the customer is (Plane gets to the destination on time)
Performance
Must Be
The better I do, the less dissatisfied the customer is. (e.g., airlines get no credit for getting bags to you on-time)
Customer Satisfaction
93
Kano Model : Exercise

Exercise 1: Classify the following as Must Be, Satisfiers & Delighters 1. Air Conditioner free with every purchase of four wheeler 2. Availability of hot water in 5 star hotel bath room 3. More mileage per liter of fuel
Exercise 2:
1. Identify a Must Be, Satisfier & Delighter from your own process
94
Gather voice of the customer

* Review existing voc data * Decide what to collect * Select tool to collect *Collect data
Voice of Customer : Ways to Capture

SURVEYS FOCUS GROUPS INTERVIEWS WORD OF MOUTH COMPLAINTS
95

Surveys :
A method of gathering information From a sample representing the population these are comprehensive data driven information vehicles that are useful in capturing customer requirements as well as measuring performance against those requirements.
Focus groups:
in this group you group together similar customers and ask for their opinion on the requirements as well as performance against those requirements
Customer interviews:
could be informal or Structured. Informal interviews give good insight into the customer perspective of the product and services and depends on probing open ended questions
96

Word of mouth:
the customer feedback comes through direct and different channels. Internal: employee feedback External: reports from known sources
Be a customer yourself :
feel the quality of Service yourself
97
Voice Of The Customer

Sample Comments/Data
Im Tired Of Having To Call up for this Lousy Product Every Ten Days I simply dont understand what the Customer Support Professional Talks about Why Dont You Guys Get Your Act Together?! The Phone Must Have Rung Ten Times Before I Got An Answer Im Not Very Happy With Your Service
What do we do with VOC input?

98
Translating Customer Needs To Requirements

Voice Of The Customer
I Am Always On Hold Or Transferred To The Wrong Person.
Key Issue(s)
Want To Talk To The Right Person Quickly
Requirement
Add Additional Menu Items To Voice System (BAD) Customer Gets To The Correct Person The First Time (GOOD)
Im Getting My Bill At Different Times Of The Month.
Consistent Monthly Bill
Customer Wants Timely Bill (BAD) Customer Bill Received Same Day Of Month (GOOD)
Take Too Long To Process The Application.
Speed Up Loan
Customer Wants Fast Loan (BAD) Customer Receives Approval On Customer Request Date (GOOD)
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Exercise 1.1
Translating Customer Needs (VOCs) To Requirements.
1. Refer to your workbook.

2. You have given a Voice Of Customer (VOC) 3. Using these VOC - Identify key issues customer is facing - Identify the specific requirements which will tackle these issues
100
Collection of Voice of Customer (VOC)

Step 1: Get the Voice of Customer (VOC) and the importance rating through survey, feedback, market research, etc. Example: VOC of a BPO company VOC Rating
Utilization of billable resources should be Very Important maximum Abandoned calls should be minimum Right & Complete Resolution Talk Time should be reasonable Good Customer Service Skills Important Very Important Important Important
101
Step 2: Quantify the Customer rating numerically. VOC

Utilization of billable resources should be maximum Abandoned calls should be minimum Right & Complete Resolution Talk Time should be reasonable Good Customer Service Skills
Rating
5 3 5 3 3 Very Important: 5 Important: 3 Reasonable: 1
Step 3: Get Voice of Stakeholder.

Voice of Stakeholder
Buffer should be minimum Reduce loss of login hours Reduce Rework Increase CSat Score
Rating
Very Important Important Important Very Important
Reduce Customer Complaints
Very Important
102
Step 4: Quantify Stake holder's voice.

Voice of Stakeholder4 Buffer should be minimum Reduce loss of login hours Reduce Rework Increase CSat Score Reduce Customer Complaints Rating 5 3 3 5 5 Very Important: 5 Important: 3 Reasonable: 1
103
Step 5: Map the Customer Requirements & Stake Holder Requirements to Business and Operational Goals.
Requirements
Utilization of billable resources should be maximum Abandoned calls should be minimum Right & Complete Resolution Talk Time should be reasonable Good Customer Service Skills Buffer should be minimum Reduce loss of login hours
Rating
Quality
High Medium High
Cycle Time High High
Training
Multi Tasking Medium
5 3 5 3 3 5 3
Medium Medium
High
Medium High
Medium Medium
High high
Reduce Rework
Increase CSat Score Reduce Customer Complaints
3
5 5
High
High High
Medium
Medium Medium
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Step 6: Calculate importance ranking to Business and Operational Goals.

Requirements
Utilization of billable resources should be maximum Abandoned calls should be minimum Right & Complete Resolution
Rating
5 3 5
Quality
High Medium High
Cycle Time High High
Training
Multi Tasking Medium
Medium Medium
Talk Time should be reasonable

Good Customer Service Skills Buffer should be minimum Reduce loss of login hours Reduce Rework
3
3 5 3 3 High
High
Medium Medium Medium
Medium
High High High
Increase CSat Score

Reduce Customer Complaints Rank
5
5
High
High 124
Medium
Medium 118 42 55
105
Step 7: Identify Key Process Output Variables or CTQs (Ys).

KPOVs (Ys) Quality Ranking 124
Cycle Time
118
Identify Six sigma projects to improve these KPOVs
106
Exercise 1.2 (10 minutes)

Six Sigma project identification through VOC 1. Refer to your workbook.
2. Identify Six Sigma projects for the areas identified through VOC 3. Allowable time : ----- Minutes
107
CTQ (Critical to Quality) & CTQ Tree

The basic reason any process exists for is to satisfy the requirements of the customer / Stakeholders.
Business CTQ Business Y
Customer CTQ
The critical customer satisfaction parameters can be broadly categorized under Cost, Quality, Delivery, Service, productivity etc which are called as CTQs
Internal CTQ Process Y
CTQ is a Product , Process or Service characteristic that satisfies a Customer Requirement (External & Internal Business Owners, all functions )
Project CTQ Project Y

108
Business Objective
Voice of customer / Organizational Goals/ Pain Areas
Business Y
Identification of Improvement Areas
Process Y
Customer Satisfaction Score
Service Level Agreement
Transactional Quality
Development Cost
Resource Utilization
Project Y
Six Sigma Black Belt & Green Belt Projects Leading to significant Top line improvement with Customer Satisfaction & Bottom line impact through Revenue generation and cost saving
109
CTQ TREE
A methodology to break the CTQs in the over all level to the CTQs at sub process level
Example 1: CTQ Tree for the KPOV: Quality Voice & Accent Example 2 : CTQ Tree for the KPOV: Cycle Time
Waiting Time
Cycle Time
Voice Quality
Empathy
Quality Data Quality
Culture
Handling Time
110
Examples of Customer CTQs

A Car Purchaser
Mileage Spacious Low price/affordable High technology Loan Facility
A Prospective Employee
Good Salary Location Preference Flexible Working Hours ESOPs Good working place
Order Management Client

Service Quality
Customer Sat (Ext)

Customer Sat (Int) Service CSat (Ext) Service CSat (Int)
Yield Productivity 1st Touch Cycle Time Case Res Cycle Time 111
CTQ Drill Down responsibility Matrix
Define what is critical (CTQ) to Business Define your Customer Explore Customer CTQ Define Internal CTQ / Critical Business Process
Champion, BB Champion, BB Champion, BB Champion, BB
112
Exercise 1.3 (15 minutes) Drawing a CTQ Tree

2. Draw a CTQ tree for your any one of the project you have selected 3. Allowable time : ----- Minutes
113
Quality Function Deployment (QFD)

What is QFD?
QFD begins with Customer. It is also called House of Quality QFD links the needs of the customer with design, development, engineering, manufacturing and service functions. It helps organizations seek out both spoken and unspoken needs, translate these into actions and designs, and focus various business functions toward achieving this common goal. QFD empowers organizations to exceed normal expectations and provide a level of unanticipated excitement that generates value. The basic idea of QFD is to translate the voice of customer, throughout the marketing, R&D, engineering and manufacturing stages of product development.
114

It is a structured approach that facilitates the translation of the customers voice into specific requirements. These specific requirements are mapped to the design process production process and delivery processes to determine the process and design requirements. Quality function deployment allows customers to prioritize their requirements Benchmark with competition, help optimize and to attain competitive advantage
115

QFD: When to use ?
To develop new product or service capability, specially for complex ones. For products and services where clarification and prioritization of efforts on key customer wants is needed. For developing or refining existing internal systems in order to build or product delivery capability.
For development of products or services that do not have a clear mapping of the customer requirements and the design attributes.
116

Benefits of QFD
QFD brings in involvement of all the departments thus improving the communication among them. Provides excellent frame work for cross functional deployment of quality cost & delivery. Since QFD is a documentation process it helps in reducing mistakes. Brings robustness in the product.
117

How to build one?
1. The first portion of QFD matrix is the Customer Requirements. All the VOC that have been translated into tangible requirements form the Customer Requirements part. 2. The second part, on the right hand side of QFD, is the Planning Matrix. It is used to quantify Customers requirement priorities and their perception of the performances of existing products. This is done through Importance Weighting of the Customer Requirements. 3. The third part of QFD is the Technical Requirement section. This describes the product or service in the terms of the company and it includes all the measurable characteristics of the product / service that might be related to meet the customers requirements. Often an additional row is included to illustrate the direction in change of variables which is supposed to result in improvement in product / Service performance. 4. The fourth part of QFD is Interrelationships section. This is used to translate the customer requirements into the technical characteristics of the product / service. Inter-relationships between each of the Customer requirements and technical characteristics are analyzed. Generally, the level of inter-relationship is shown with the help of symbols denoting a 3 point scale (High, medium, low ). Each level of inter-relationship is assigned a score. Generally a score of 5-3-1 is used to denote High-medium-low-none.
118

5. The fifth part of QFD is the Roof. This is used to denote the areas where the technical requirements characterizing the product or service support or inhibit each other. Where there is a deterioration because of interaction, - sign is used. Where there is an improvement in one characteristic because of the other, + sign is used. 6. The final component of QFD is the Targets. It summarizes the conclusions drawn form the matrix and teams discussion. It consists of three parts: a) Technical Priority b) competitive Benchmarks and c) Targets. a) Technical Priority signifies the relative importance of each of the technical requirement in meeting the Customers specified needs. It is calculated by summing up the products of interrelationships weightings with the overall weighting in the planning matrix. b) Competitive Benchmarking: Each of the technical requirements identified as important characteristic of the product or service are compared vis--vis the existing product and the competitors product. c) Targets: The final outcomes of QFD are the targets. These are a set of target engineering values to be met by the new product or service.
119
Structure
3
Roof
Technical Requirements
4 1
Customer Requirements INTER- RELATIONSHIPS Planning Matrix
Techincal Priorities Targets
120
3
Roof
STEP - 1
Planning Matrix
4 1
Customer Requirements
Customer Requirement : Basically focus on desired deliverable/outcomes from the process Customer Importance : Rating of Customer requirement on a scale of 1-5
INTER- RELATIONSHIPS
6 7
Customer importance
Quality monitoring
Overall weightage
Technical Requirement
Improvement factor
Planned rating
Process tools
Competitor A
Competitor B
Our product
Technology
Experience
Sales point
Training
Complete Resolution first Time Resolution good Customer Service Ontime delivery Aware of support boundaries Quick Response Customer Education Technical Priorities % of total Benchmarking all products Competitor product A Competitor product B Design Targets
5 5 4 5 3 5 3
Culture
Customer Requirement
% of Total
121
3
Roof
STEP - 2
Planning Matrix
4 1
6 7
Technical Requirement : This describes the product or service in the terms of the company and it includes all the measurable characteristics of the product / service that might be related to meet the customers requirements ; Basically focus on input parameters which will have direct/indirect impact on deliverable/outcomes of the process;
Improvement factor Quality monitoring Overall weightage
Customer importance
Planned rating
Process tools
Competitor A
Competitor B
Our product
Technology
Experience
Sales point
Training
5 5 4 5 3 5 3
Culture
% of Total
122
3
Roof
STEP - 3
4 1
Roof : It shows the inter-relationship between two or more inputs Parameters ` + means positive relationship ` - means negative relationship
6 7
+ +
Customer importance Improvement factor Quality monitoring Overall weightage
Planned rating
Process tools
Competitor A
Competitor B
Our product
Technology
Experience
Sales point
Training
5 5 4 5 3 5 3
Culture
% of Total
123
3
Roof
STEP - 4
4
6 7
+
Customer importance
Inter-Relationship Block : It shows the interrelationship between inputs parameters and output deliverable ` 5 means Strong relationship ` 3 means Medium relationship ` 1 means Weak relationship ` 0 means No relationship
Quality monitoring
Overall weightage
Improvement factor
Planned rating
Process tools
Competitor A
Competitor B
Our product
Technology
Experience
Sales point
Training
5 5 4 5 3 5 3
5 5 3 3 1 3 5
5 5 5 3 3 3 5
1 1 1 5 1 5 1
5 5 1 5 3 3 1
5 5 3 1 3 3 5
Culture
1 1 5 1 1 3 3
3 2 3 3 3 3 2
% of Total
124
3
Roof
STEP - 5
Planning Matrix
Planning Matrix : Our Product : Rating of existing product/service on scale of 1-5 against customer requirements Competitor A/B : Rating of Competitor product/services against our customer requirements
4
6 7
+
Customer importance
Quality monitoring
Overall weightage
Improvement factor
Planned rating
Process tools
Competitor A
Competitor B
Our product
Technology
Experience
Sales point
Training
5 5 4 5 3 5 3
5 5 3 3 1 3 5
5 5 5 3 3 3 5
1 1 1 5 1 5 1
5 5 1 5 3 3 1
5 5 3 1 3 3 5
Culture
1 1 5 1 1 3 3
3 2 3 3 3 3 2
4 4 4 5 4 4 4
4 3 4 4 4 4 3 Total
Competitor Rating shall be benchmark rating

125
% of Total
3
Roof
STEP - 5
Planning Matrix
4
6 7
+
Customer importance
Planned Rating : Target rating for customer requirement based on competitor rating Improvement Factor : Ratio of Planned rating and Our product Rating Sales Point : Rating of Sales team (sales perception)on ability to sell the product/services based on how well each customer need is met, on scale of 1.1, 1.3 and 1.5
Improvement factor
Quality monitoring
Overall weightage
Planned rating
Process tools
Competitor A
Competitor B
Our product
Technology
Experience
Sales point
Training
5 5 4 5 3 5 3
5 5 3 3 1 3 5
5 5 5 3 3 3 5
1 1 1 5 1 5 1
5 5 1 5 3 3 1
5 5 3 1 3 3 5
Culture
1 1 5 1 1 3 3
3 2 3 3 3 3 2
4 4 4 5 4 4 4
4 3 4 4 4 4 3
4 1.3 4 2.0 4 1.3 5 1.7 4 1.3 4 1.3 4 2.0 Total
1.3 1.3 1.1 1.3 1.1 1.1 1.3
1.1 : Low inter-relationship 1.3 : Medium inter-relationship 1.5 : Strong inter-relationship 126
% of Total
3
Roof
STEP - 6
Planning Matrix
4 1
6 7
+
Customer importance
Overall Weighting : Product of Sales Point, Improvement factor and Customer Importance Technical Priorities : signifies the relative importance of each of the technical requirement in meeting the Customers specified needs. It is calculated by summing up the products of interrelationships weightings with the overall weighting in the planning matrix.
Improvement factor Quality monitoring
Planned rating
Process tools
Competitor A
Competitor B
8.7
43.5 65
Training
Culture
Customer Requirement Complete Resolution first Time Resolution good Customer Service Ontime delivery Aware of support boundaries Quick Response Customer Education Technical Priorities % of total Benchmarking all products Competitor product A Competitor product B Design Targets
3 3 1
5.9
17.7 32.4 4.4
10.8 4.4
5 5 4 5 3 5 3
5 5 1 5 5 1 3 4 3 2 7.34 5 5 1 5 5 1 3 5 1 1 3 5 5 3 7.84 3 3 5 5 1 1 3 5 1 3 1 3 3 1 3 4 3 3 5 3 3 3 3 4 5 5 1 1 5 3 2 4 224 244 131 211 211 112 1133 20% 22% 12% 19% 19% 10%
4 4 1.3 321.9 2.0 4 4 394 1.3 4 5 1.7 4 4 1.3 4 224 1.3 4 3 4 2.0 Total
1.3 8.7 14.97% 1.3 13.0 22.45% 1.1 5.9 10.13% 1.3 10.8 18.71% 1.1 4.4 7.60% 1.1 7.3 12.67% 1.3 7.8 13.47% 57.9
% of Total
13
Overall weightage
Our product
Technology
Experience
Sales point
127
3
Roof
STEP - 7
Planning Matrix
4 1
Targets : The final outcomes of QFD are the targets. These are a set of target engineering values to be met by the new product or service.
6 7
+
Customer importance
+
Improvement factor
Quality monitoring
Overall weightage
Planned rating
Process tools
Competitor A
Competitor B
Our product
Technology
Experience
Sales point
Training
5 5 4 5 3 5 3
5 5 1 5 5 1 3 5 5 1 5 5 1 2 3 5 1 1 3 5 3 3 3 5 5 1 1 3 1 3 1 3 3 1 3 3 3 5 3 3 3 3 5 5 1 1 5 3 2 224 244 131 211 211 112 1133 20% 22% 12% 19% 19% 10%
Culture
4 4 4 5 4 4 4
4 3 4 4 4 4 3
4 1.3 4 2.0 4 1.3 5 1.7 4 1.3 4 1.3 4 2.0 Total
1.3 8.7 14.97% 1.3 13.0 22.45% 1.1 5.9 10.13% 1.3 10.8 18.71% 1.1 4.4 7.60% 1.1 7.3 12.67% 1.3 7.8 13.47% 57.9
% of Total
128
4 House QFD
Customer Measurements (HOWs)
Customer Measurements (WHATs)
House of Quality #1
Customer House
Customer CTQs (WHATs)
Internal Actions (HOWs)
Internal Actions (WHATs)
House of Quality #2
Function House
Process Requirements (HOWs)
Process Requirements (WHATs)
House of Quality #3
Process House
Process Variables (HOWs)
House of Quality #4
Control House
Define
Improve
Control
129
Points to Remember in QFD

Dos
Focus on the end-user
Donts
Charts as the ends & not the

means Find reasons to succeed, not excuses for failure If there are no tough spots the Dont apply QFD on everything Avoid too much chart focus Dont hurry up & get done
first time, it probably is not being

done right !
130
A Restaurant Example Manila Pizza

CTQs from VOC (WHATs) Type of Menu Economic aspect Presentation of staff Type of service Quality of service Quality of Food
Importance Rating 3
4 3 3 4 5
Measurements on CTQs (HOWs) Varieties available in terms of Chinese, Indian, Continental food Price Availability of parking space Food served at right temperature Waiting time for food/order Options to pay ( Cash/Debit card/Credit card) Cleanliness of cutlery / attendants attire Staff courtesy Taste of food Ambience
131
Define
+
Customer importance
+ +
Improvement factor
Varieties available
Overall weightage
Options to pay
Planned rating
Taste of food
Competitor A
Competitor B
Waiting time
Our product
Sales point
Capturing Customer Requirement along with importance rating
Type of Menu Economic aspect Presentation of staff Type of service Quality of service Quality of Food
Technical Priorities % of total Benchmarking all products Competitor product A Competitor product B
3 4 3 3 4 5
5 3 1 3 1
Price
3 5 3 3 3
3 1 1 5 5
1 5 1 5 5
5 5 1 1 3
1 3 5 1 1
3 2 3 3 3
4 4 4 5 4 4
4 3 4 4 4 4
4 1.3 1.3 4 2.0 1.3 4 1.3 1.1 5 1.7 1.3 4 1.3 1.1 4 1.3 1.1 Total
5.2 13.10% 10.4 26.20% 4.4 11.08% 6.5 16.37% 5.9 14.78% 7.3 18.47% 39.7
3 3 1 1 5 1 3 109 140 100 131 143 78 700 16% 20% 14% 19% 20% 11% 3 5 10 minsopts 3 3 4 USD 15mins opts 2 4 6USD10mins opts 3 5 4 5 5 5 3
5 USD per person
All three options
3 Varities
Above 4
Design Targets
Above 4
10mins
% of Total
Ambience
132
Improve
+ +
Qualificaiton of Chef Experience of Chef
+
Raw Material availability Communication system Raw Material Quality Improvement factor Overall weightage Delivery System
Customer importance
Planned rating
Competitor A
Competitor B
Our product
Sales point
Taste as per expectation Temperature of Food Add-on over ordered food Effect on Health
Technical Priorities % of total Benchmarking all products Competitor product A Competitor product B
5 4 1 5
5 5 3
5 1 3
5 3 1
1 5 1
5 1 5
5 1 5
3 3 3
5 4 4 5
4 3 5 4
5 1.7 1.3 4 1.3 1.3 5 1.7 1.1 5 5.0 1.3 Total
10.8 20.79% 6.9 13.31% 1.8 3.52%
3 3 1 1 1 5 1 192 164 109 80 103 233 881 22% 19% 12% 9% 12% 26% min 4yrs PG 5yrs PG 8yrs PG
10mins 5yrs PG
32.5 62.38% 52.1
5 5 5
5 3 5
Above 4
5 4 5
Above 4
5 3 5
Design Targets
% of Total
133
Control
+ +
Training to Material Handlers Inward Quality Inspectors Temperature of Storage system
Improvement factor
Overall weightage
1.1
Inventory Management
Customer importance
Planned rating
Competitor A
Competitor B
Our product
Sales point
Freshness of Vegetable used5 Quality of Food grain used 4 Storage System 1 FIFO 5
Technical Priorities % of total Benchmarking all products Competitor product A Competitor product B Design Targets
5 1 5
5 5 1
Supplier
1 3 1
1 3 5
3 1 5
4 5 4
4 4 4 5
4 3 4 4
4 1.0 1.3 4 0.8 1.3 4 1.0 1.1 5 1.7 1.3 Total
6.5 28.77% 4.2 18.41% 4.87%
5 1 1 1 5 3 96 65 31 35 83 311 31% 21% 10% 11% 27% SOP PG SOP PG SOP PG Cert. Cert. Cert. 5 5 5 5 5 5
10.8 47.95% 22.6
SOP
PG
% of Total
134

Preparing the first two houses of the QFD
2. Prepare the first two houses of the QFD for a given example
135
Brainstorming & Multi-voting Example

Below table illustrates the number of group members & total ideas generated
Now each member gives votes to ideas (maximum one vote to each idea) & below is the vote distribution for ideas
Top ideas whose vote count adds upto 32 are as below (30 is not possible), there are 7 such ideas
136
Brainstorming & Multi-voting Example

Take these 7 ideas for further round of multi-voting
Give each member 4 votes (round off 50% of 7 to next higher integer) & ask them to distribute these 4 votes among these 7 ideas. Below could be the distribution in this fresh round of voting
Take top ideas whose vote count adds upto 9
This list is manageable
137
Points to Remember in Brainstorming

All ideas are important, dont out rightly reject any idea Participation should be ensured from all team members To ensure this, project teams could use the round-robin method of idea generation Its advised to use the Black Belt as the facilitator here
138

Multi-voting
2. Do a multi-voting exercise for a given example
139
A Right Project Selection is key to success

Right Project Selection Selecting the right project can have a tremendous effect on your business. If done properly, Processes will function more efficiently in 3 to 6 months, employees will feel satisfied and Appreciated for making business improvements and ultimately stakeholders will see the benefit Wrong Project Selection If project selection is done improperly, a project may be selected that doesn't have the full business buy-in, project roadblocks may not be removed due to other business priorities, the team may feel Ineffective and the end result may be less than ideal. No one wins in this situation
140
Six Sigma Project Selection Filters 1. Company Filters and 2. Six Sigma Filters
Once the potential projects are identified next step is to verify, whether these are six sigma project or not ? There are two type of filters to qualify the potential projects as six sigma projects. They are 1) Company filters and 2) Six Sigma Filters
141
1. Company Filters
Aligned with company Strategy? No Why do it? Drop No Yes No Does project lead USD--- min. per annum? 1) Is it a severe pain in the process 2) Is documental proof available to prove pain 3) Is the pain sensed by process experts
Yes
Yes (all 3)
No
Can it be completed in 4 to 6 months?

Yes
Scope is too large. Consider making Multiple projects.
Move to Six Sigma Filters
142
2. Six Sigma Filters

Is the solution already known? No Is needed data available to quantify the problem? Yes Is the root yes cause known? No Is someone else working on the problem? no No Yes Derive and implement the solution No Implement a data collection plan yes Implement the solution
Yes
Implement the other teams solution
Six Sigma Potential Project
143
Types of Projects
1. Projects cutting across processes focusing on CTQ. 2. Projects cutting across CTQ focused on process. 3. Projects focusing on a specific CTQ for a process.
144
SS Project Execution Process Map

Client & Top Management
Voice Of Customer & Pain Areas
Champion
Recognition of Improvement opportunity
Problem Definition Project Agreement & Target setting Project Review at Pre-defined Frequency (MBB & Champion)
MBB
Project Evaluation & Methodology selection (DMAIC / DMADV)
Finance Controller
Initial Financial Validation
Final Financial Validation
Project Validation, Closure and signoff by champion, MBB and Financial controller
BB
Project Charter
(Champion / sponsor)
Project Kick Off (MBB & Champion are secondary resp.)
Project Execution ( DMAIC / DMADV ) (MBB & Champion are sponsor )
GB & Team
Integration & Deliver
Improvement Project Execution

1- MBB 1- BB, 1- GB 4 - PA DMAIC Project
Project 1
Project 2 Project 3
Business Process Improvement
1- BB, 1- GB 4 - PA DMADV Project
Project 1
Project 2 Project 3
1- GB 4 - PA
Project 1
REIS Project
Project 2 Project 3
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Six Sigma DMAIC Methodology
147
Overview of DMAIC Methodology

DMAIC Vs DMADV DMAIC Methodology Define Measure Analyze Improve and Control
148
DMAIC Vs DMADV
IMPROVEMENT PROCESS CREATION PROCESS
(DMAIC)
Define, Measure, Analyse, Improve and Control Improve processes, products, services, and organisation to 6 Sigma quality
(DMADV)
Define, Measure, Analyse, Design and Validate
Create new processes, products, services, and plants to 6 Sigma quality. It is also Called DFSS
Process Management
PROCESS MANAGEMENT Leverage and sustain the gains achieved by improvement and creation with BPMS, QMS, COPC etc
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DMAIC Methodology
Step 5: CONTROL
Step 1: DEFINE
DMAIC Define Define project goals & customer (internal & external) deliverables Measure Measure the process to determine current performance
DMAIC
Step 4: IMPROVE
Step 2: MEASURE Improve Improve the process by eliminating

defects
Analyze Analyze and determine the root cause of the defects
Control
Control future performance
Step 3: ANALYZE
150
Define
Objective:
is to define the problem in a clear manner and in a way that is related to an internal or external customer.
Deliverables:
Fully trained team, committed to work on improvement project. Customers identified and defined (CTQs) Project charter and Process map
Check points:
Trained team Customers (and CTQs) Project Charter Business process mapping (SIPOC) Process Map
151
Measure
Objective
to measure what you care about most, making certain that your measurement approach is sound and not based on questionable formulas or data.
Deliverables:
Key measures identification, data collection plan, data on process variation performance baseline, sigma level calculation.
Check points:
Identification of Key measures - Defining high impact defects Data Collection Plan - Data collection Measurement system analysis Process Variation Long term and short term variability accounted for. Performance Baseline/Sigma Calculation Measure baseline process performance (capability, yield, sigma level).
152
Analyze
Objective
is to look for the critical root causes of the variability by applying statistical tools to determine what factors are contributing to the problem.
Deliverables:
Data and process analysis, root cause analysis, quantifying the gap/opportunity.
Check points:
Data and Process Analysis Identification of gaps between current performance and the goal performance Root Cause Analysis- Verify and quantify the root causes of variation Quantifying the Gap/Opportunity - Determine the performance gap.
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Improve
Objective is to determine and confirm the optimal solution.
Deliverables: Generate (and test) possible solutions, select the best solutions, design implementation plan Check points: Generating (and Testing) Possible Solutions Selecting the best Solution (s) Designing Implementation Plan
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Control
Objective
is to be sure the quality improvements remain in effect and the problem does not recur.
Deliverables:
Documentation and implementation of monitoring plan, standardized process, documented procedures, response plan established and deployed, transfer of ownership (project closure).
Check points:
Monitoring Plan Process Standardization Documented Procedures Transfer of Ownership (Project Closure)
155
Define Phase
156
Define
Main Activities
Define Opportunities
1.0
Define
Step 1: Identify customer & their care about. Convert their needs in to Critical to Satisfaction (CTS) i.e. CTQ Critical to quality, CTC Critical to Cost & CTD Critical to Delivery. Step 2: Develop Project Charter reporting improvement opportunity and effective project team
Main Tools used

Project Charter
Define Phase Outcomes

Gap Analysis List of Project CTQs QFD/CTQ Tree Signed off Project charter Team Charter CCRs SIPOC Macro Level Process Map
157
VOC
Problem Statement Goal Statement Project team
Business Case Project Scope Project Timeline
Baseline
Target
SIPOC OC S I Process Process Map
Define Phase Topics

Project Charter Team Charter SIPOC
Process Mapping Top Down Model Cross Functional Process Mapping & ICOM model
158
Project Charter
159
Project Charter
What Is A Project Charter?
A project charter is a document that provides purpose and goals for an improvement team
Six Major Elements of a Project Charter

1. Business Case Explanation Of Why To Do This Project 2. Problem And Goal Statements Description Of The Problem/Opportunity And objective In Clear, Concise And Measurable Terms 3. Project Scope Defined project beginning and end points 4. Milestones Key Steps And Dates To Achieve Goal 5. Roles People, Expectations, Responsibilities 6. Financial Impact Savings, impact on bottom-line
160
Business Case
Business Case Development The business case describes the benefit for undertaking a project. The business case addresses the following questions: Does this project align with other business initiatives? What is the focus for the project team?
What impacts will this project have on other business units and employees?
What benefits will be derived from this project? Has the value of the benefits been quantified?
161
Problem Statement
Description Of The Pain
What Is Wrong Or Not Meeting Our Customers Needs? Who is the customer of the process ?
What is the process ?
When And Where Do The Problems Occur?
How Big Is The Problem?

Whats The Impact Of The Problem?
If I let it be what will happen ? If I reduce it what will happen ? If I increase it what will happen ?
162
Problem Statement Example

Poor Example:
Weak Problem statement Our Fatal accuracy score is at 80% against the client target of 95% and we Need to improve it
Improved Example:
Fatal accuracy score (what) this quarter (when) has been observed to be at 80% for the last 4 months (extent) against the client target 95% which has significant impact on customer satisfaction. (impact)
163
The Problem Statement

Key Considerations/Potential Pitfalls
Is The Problem Based On Observation (Fact) or Assumption (Guess)?

Does The Problem Statement Prejudge A Root Cause? Can Data Be Collected By The Team To Verify and Analyze The Problem? Is The Problem Statement Too Narrowly or Broadly Defined? Is A Solution Included In The Statement? Would Customers Be Happy If They Knew We Were Working On This?
164
The Goal Statement

Project Objective
Definition of The Improvement The Team Is Seeking To Accomplish Starts With . Reduce, Eliminate, Control, Increase. Tends To Start Broadly Eventually Should Include Measurable Target And Completion Date Must Not Assign Blame, Presume Cause, Or Prescribe Solution!
165
SMART Problem And Goal Statements
Specific
Measurable
Attainable
Relevant
Time Bound
166
Goal Statement Example

Poor Example: Put in place a Transaction monitoring evaluation system to increase the fatal accuracy.
Improved Example: Increase the fatal accuracy from the existing 80% to 95% by the end of first quarter 2005.
167
Project Scope
What Process Will The Team Focus On?
What Are The Boundaries Of The Process We Are To Improve? Start Point? Stop Point?
What Resources Are Available To The Team?

What (If Anything) Is Out Of Bounds For The Team?
What (If Any) Constraints Must The Team Work Under?

What Is The Time Commitment Expected Of Team Members? What Will Happen To Our Regular Jobs While We Are Doing The Project?
168
8 Steps to Scope a Project

1. Identify the customer Who receives the process output? May be an internal or external customer 2. Define customers expectations and needs Ask the customer Think like the customer Rank or prioritize the expectations 3. Clearly specify your deliverables tied to those expectations What are the process outputs? Tangible and intangible deliverables Rank or prioritize the deliverables Rank your confidence in meeting each deliverable 4. Identify CTQs for those deliverables What are the specific, measurable attributes that are most critical in the deliverables Select those that have the greatest impact on customer satisfaction
169
8 Steps to Scope a Project

5. Map your process The process of producing the deliverables The process as it is working prior to the project If you are delivering something, there is a process, even if it has not been formalized 6. Determine where in the process the CTQs can be most seriously affected Use a detailed flowchart Estimate which steps contain the most variability 7. Evaluate which CTQs have the greatest opportunity for improvement Consider available resources Compare variation in the processes with the various CTQs Emphasize process steps which are under the control of the team conducting the project 8. Define the project to improve the CTQs you have selected Define the defect to be attacked
170
Importance of Scoping
Poor/improper scoping may result in following:
Team loses interest in the project

Project becomes difficult to implement Even after implementation, the desired/significant benefits are not seen Team focuses on trivial pain areas, and missing out the vital
ones
Process selected is too broad to handle or too small to realise breakthrough improvements.
171
Milestones
A preliminary High Level Project Plan with dates
Tied to phases of DMAIC process

Should be aggressive (dont miss window of opportunity ) Should be realistic ( dont force yourself into corrective rather than preventative solutions)
1-May Define Measur e Analyze Improve
7-May
16-Jun
23-Jun
7-Jul
Week : Review Charter with Champion Collect VOC Complete Map
1 X
3 4
X X
X X
Validate Map
Collect Data
X
X
Control
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Take Aways Project Charter

Key elements of a charter include: Business Case, Problem and Goal Statements, Project Scope, Milestones, and Roles. The team charter is a vital part of the projects overall success. It communicates the project direction to all members of the team. A Problem Statement describes what is wrong while a Goal Statement defines the improvement objective. A charter clarifies what is expected of the project team, keeps the team focused, keeps the team aligned with organizational priorities, and transfers the project from the champion to the improvement team
173
Project Charter
Goal statement:
Problem Statement :
Example
Start
1 Mar 05
End
30 May 05
Responses
Project Sponsor MBB Project Leader Black Belt Name
MEMBERS
xxxxxx
Xxxx (YB)
Reduction of rework from 38% to 5%
xxxxxxxxx
Sign
The rework percentage in this quarter (Apr05 to June05) has been observed to be at 38% based on the system reports which is leading to over stretching of PE to meet the production targets.
In-scope :
All exiting sub processes in the process
jkafkj jkjklaj dxcv Target
Out-scope :
Any new sub-process to be adding with in the project period
Measurable Goals : Rework reduction Unit: Percentage
Current
Current Target
38
2.5
4.2
Business case
Estimated Saving Expected, ( 1 Fin. Year)

Revenue Enhancement Expense Reduction
Rework is one of the main concern area in our xxx process. Due to rework, most of our PE are over stretching their working hours. Our quality percentage is being maintained below the SLA.
The client also concern about the issue and suggested to take action with in 3 months to improve the same. Failure of the same may lead to employee attrition and loss of business.
IMPCHG/QLTY/TMPL/6111 Version 1.0, Copy if printed
Loss Avoidance
Costs
50,000 USD
Basic Schedule Define 16.03.05 Measure 25.03.05 Analyze 07.04.05
Improve 21.04.05
Control 06.05.05
174
Project Scoping responsibility Matrix
Scope the Project Develop Team Charter
GB, BB, Champion GB, BB
175

Project Scoping

2. Define in-scope & out-scope given project example
176
Team Charter
177
Team Charter
Team Roles Refresh Sponsor Review the project progress once a month Provide/modify direction/alignment with business realities Provide resources required from time to time Remove Roadblocks Team Charter explains following How do you want the champion to work with the team? Is the teams role to implement or recommend? When must the team go to the champion for approval? What authority does the team have to act independently? What and how do you want to inform the champion about the teams progress? What is the role of the team leader and the team coach? Are the right members on the team? Functionally? Hierarchically?
Black Belt/MBB Provide content knowledge on Six Sigma tools to the team
Project Leader Keep the team focused. Arrange logistics and team meetings and raise issues with Sponsor Team Member (s) Participate in meetings, collect data, do analysis using Quality tools, provide subject matter expertise related to process
178

Team Charter Breakout Activity 1. Refer to your workbook.
2. Practice writing problem and goal statements
179
SIPOC
181
SIPOC
SIPOC:
A tool to identify all relevant elements of a process Helps to understand a complex process better Graphic display of steps, events and operations that constitute a process S - Suppliers I - Inputs Process
P -
O - Outputs C Customers
182
SIPOC
Suppliers
People who provide input to the process
Inputs
Information, material etc., goes into the process from some other group of people (supplier)
Process
Process is a series of activities that takes an input, adds value to it and produces an output for a customer
Outputs
Output of a process creating a product or service that meets a customer need
Customers
Users of the output
183
Information Flow & Measures

Thinking Flow
Requirements Requirements
S
Suppliers
I
Inputs
P
Process
O
Outputs
C
Customers
Input Measures
Process Measures
Measures That Are Internal To Your Process. They Include Quality and Delivery Measures Important To Your Internal Customers As Well as Waste and Cycle Time Measures.
Output Measures
The Key Quality and Delivery Requirements Placed On Your Suppliers.
Output Measures Are Measures Used To Determine How Well Customer Needs And Requirements Are Met.
184
SIPOC: Uses
To know who supplies input to the process To know what are the inputs to the process To know step by step flow of process To know the outputs of process To know the customer of a process
185
Steps to create SIPOC

1. Attaining a full understanding of all the steps of a process. This is done by looking at processes from customers point of view. 2. Clearly define the process start and end boundaries 3. Brainstorm list of all process steps. Go on the floor, walk through the process and interview people working on the process as needed. 4. Recorded process steps using a sticky-note method. In this method each step in the process is recorded on a sticky-note and built in front of the individual completing the work.
5. Discuss, review & modify process step sequence to agree on As Is process map.
6. Add suppliers, inputs, outputs, customers 7. Add Input, Process, & Output measures
186
SIPOC: Format
Supplier A B Inputs X1 X2 Process Output Y1 Y2 Customer Alpha Beta
X3
Y3
Gamma
187
SIPOC: Example 1: Contract Management : Contract Publishing

SIPOC LEVEL I
Contract Management : Contract Publishing
Supplier
Scanning Team
Input
Electronic Documents Job Aid: Four-Eye principle, Commodity Classification, Template from Emptoris, Asignatory list
Process
1.Receive scanned images 2.Sanity Check
Output
Customer
Contract Record 3.Assign Contract Number
ABC Bank
Global SourcingABC Retained
4. Upload Data Vendor folder in shared drive
P2P Arthur
5.Create Vendor Folder in the shared drive Vendor Number from SAP, Contract template from Emptoris
6. Review Contract record
7.Publish Contract Contract Number.xls, Contract Information Sheet
8.Update Contract Tracking Sheet
188
Contract Management : Contract Enquiry

SIPOC LEVEL I
Contract Management : Contract Enquiry
Supplier
Input
Query Received
Process
1. Receive Query and review
Output
Customer
2. Update Query tracker sheet
Resolution Document
ABC Bank
Job Aid 3. Verify Authorization P2P Contract Management Onshore Team Contract Number.xls, Authorization Sheet 4. Check Availability Communication to the Enquirer P2P Arthur
5. Get information/document
6. Communicate to the user
7. Close query in the tracker
189
Contract Management : Contract Review

SIPOC LEVEL I
Contract Management : Contract Review
Supplier
Input
Electronic Documents
Process
1. View & analyze electronic document
Output
Customer
2. Check Contract Compliance Job Aid
Review Record
ABC Bank
P2P Contract Management Onshore Team
3. Validate Contract Data Emptoris
P2P Arthur
4. Check terms & conditions Vs ABC standard terms & conditions Contract Number.xls 5. Create Contract Summary records
190
SIPOC: Example 2: Call Handling

S
Agents Team Managers
I
Incoming Call ACD IVR
P
Call Opening Spanish?
O
Completed Call Interpreter Performance Reports
C
Caller Client
Confirmation Auditors Verification
Internal Customers
Number of agents, Managers, Auditors,

Certified / On training Experience /Vintage Process Knowledge Listening / Accent, speaking & keyboarding Skills
App
Number of ACD calls, Pattern, Q Spanish? Nature of Query
Assistance
Response Escalate?
Speed of answer
Calls abandoned & Time Quality Talk Time
Satisfaction score ASA Agent productivity Talk Time
N
Closing After Call Work No of lines per step, Time per step, Time holding for response, Call Accuracy, Quality, Cycle Time
App
Response Uptime of ACD, Alltel Noise?
Wrap Time
Hold time Resolved ?
Wrap Time
% Abandoned Aband Time AHT,ACW
Input Measures
Process Measures
Output Measures
191

SIPOC
1. Refer to your workbook. 2. Draw the SIPOC for your process
192
Process Mapping
193
Process
Process is a series of activities that takes an input, adds value to it and produces an output for a customer
RESOURCES
INPUT
PROCESS
OUTPUT
MEASURES SLAs
194
Process Mapping Definition
Process mapping is a graphical display of steps, events and operations that constitute a process.
195
Why Process Mapping?

Validates our understanding of the process with the client (The way work gets done) Identifies hidden process steps Helps to understand weak links in the process Eliminate the ambiguity & brings standardization Helps to identify data collection point during measure phase
Imparts training to others

To design the to be process
196
Flowchart Vs. Process Map Flowchart

May only shows the connected steps in a process
Process Map
Goes further showing who is doing what, with whom, when, for how long and with what documents.
It shows how operational decisions are made
197
Process Map Symbols Symbol Meaning

Start or End of Process
Activity or Process Step Decision or Inspection Point

Delay Connector Document Data Direction of Flow
198
Basic Types of Process Maps Linear Process Maps

It can be used when The process is not very complicated Micro level (detailed) map is dropped down from the macro (high level) process steps.
Call Opening Confirmation Verification Assistance Response Closing
Cross Functional Process Maps

(also known as Swim Lane process map)
Dept 1
Step 1
It can be used when The process complicated consists of several activities between different departments or groups.
Dept 2
Step 1
Step 4
Dept 3
Step 3
Dept 4
199
As Is Process Map in define phase

Objective of As Is process map in define phase is to identify hidden process steps in process. It helps to understand weak links in the process It also helps to identify non value adding process steps in the process
200
Steps to create As Is Linear Process map

1. Attaining a full understanding of all the steps of a process. This is done by looking at processes from customers point of view.
2. Clearly define the process start and end boundaries
3. Brainstorm list of all process steps. Go on the floor, walk through the process and interview people working on the process as needed.
4. Record individual process steps on the sticky-note / post it. 5. Discuss, review & modify process step sequence to agree on As Is process map.
201
Analyze As Is Linear Process map

Next Step : Analysis of As Is process map 1. Analyze process map to identify NVAs. (identify unnecessary approvals, isolating rework, removing duplicate forms and investigating decisions leading to no results)
2. Identify data collection & decision making points.

3. Compare with To Be process map to identify the gaps.
202
As Is Linear Process map : Example 1

Call Opening
Collect data on % Spanish calls
Spanish?
Yes
Interpreter
Response
No Confirmation Assistance
Collect data on % escalated calls
Yes Verification NVA On hold No Call closing Escalate?
Collect data on % accuracy
Assistance After call work
NVA
= Non value added activity
203
As Is Linear Process map : Example 2

Business Unit A Are Metrics in place? Define Metrics & implement data collection plan
Business Process
Identify Critical Process
Validate the Metrics
Study Process
Process Base lining
Identify Customers
Does Gap Exists? Yes Does Process exists? Yes
No
Explore need of performance excellence Apply DMADV / Process Re Engineering
List out Customer Expectations/Deliverables
No
Does Process Exists?
No
Long Term Approach Apply DMAIC Quick wins Fix it
Yes A
204
Steps to create As Is cross functional map

1. Attaining a full understanding of all the steps of a process. This is done by looking at processes from customers point of view. 2. List all departments or groups involved in the process. (Record in left column of swim lanes) 3. Clearly define the process start and end boundaries 4. Brainstorm list of all process steps. Go on the floor, walk through the process and interview people working on the process as needed. 5. Record individual process steps on the sticky-note / post it. 6. Discuss, review & modify process step sequence to agree on As Is process map.
205
Analyze As Is Cross functional Process map

Next Step : Analysis of As Is cross functional process map 1. Analyze process map to identify NVAs. (identify unnecessary approvals, isolating rework, removing duplicate forms and investigating decisions leading to no results)
2. Identify data collection & decision making points.

3. Compare with To Be process map to identify the gaps. 4. Identify the cross functional complexities involved in the process.
206
Cross Functional Process Mapping

Function 1
Step 4 Step 5
Step 3
Function 2
Step 2
Function 3
Step 1
Step 8
Step 9
Function 4
Step 6
Step 7
207
Client & Top Management
Voice Of Customer & Pain Areas
Example 1
Project Sponsor
Recognition of Improvement opportunity
Problem Definition Project Review at Pre-defined Frequency (MBB & Champion)
Project Agreement & Target setting Project Evaluation & Methodology selection (DMAIC / DMADV)
MBB
Finance Controller
Initial Financial Validation
Project Validation, Closure and signoff by champion, MBB and Financial controller
BB
Project Charter
(Champion sponsoror.)
Project Kick Off (MBB & Champion are secondary resp.)
Project Execution ( DMAIC / DMADV ) (MBB & Champion are sponsoror.)
GB & Team
Integration in Deliver
208
Example 2 : Photo Process

Photographer
Take Photograph Return home Place film in Pre paid envelope Send to Processor 1 Day Delay 3 days Process Negative Produce Prints 1 hr Inspect N Await Photograph Send to Photographer 3 days Photograph to be framed Inspect Photograph Y Frame N Store in album Y OK ? Package for posting
Postal System
Processor
The flowchart below depicts the activities involved from taking a photo to developing, framing and storing the result.
209
Example3: Import process

Imports Planning Get Options details from Logistics if reqd. Supplier Finance Forwarder / Clearing Agent Customs
Plan & Schedule
Obtain price & Prepare P.O Approve P.O Fax / Mail copy to supplier Direct Payment or Check payment Site Draft terms LC Request for LC Open LC & send Copy to Imports Prepare Order Ack & Send to Company
Verify LC
OK Inform & send Copy to supplier Follow-up material
Not OK
Verify correctness Of LC & Inform
210

Imports A Arrange material Collect material Arrange shipment & Details to company/Supplier Send documents to company And Supplier Prepare checklist for Internal circulation Advise finance for Insurance Send to clearing agent For preparation of BE Receive info from Bank Send to Imports for certification Arrange for payment & Retire documents Send documents to Clearing agent Send documents to Imports Prepare Bill of Entry & Files with Customs B Send documents To bank Arrange Insurance Supplier Finance Forwarder / Clearing Agent Customs
Check & certify docs
211

Imports Supplier Finance Forwarder / Clearing Agent B Inspect & ascertain Customs Duty Customs
Inform Company - Imports Prepare RFC to finance customs duty Prepare payment and Send to clearing agent
Deposit amount in Customs & clear the goods
Inform Company-Imports for Collection of material Inform W.H to collect The material
W.H Collect the material & prepare GR
Move to Stores.
212
Other Types of Process Maps
Top Down Model ICOM
213
Macro to Micro (M2M) Process Map

It can be used when - Team wants to pay attention to the important process steps in detail.
The Process
Step 1 Step 2 Step 3 Step 4
The Sub-Process
The Micro-Process
214
Example 1 : Quotation Sub-Processes

Research Create Proposal Refine Proposal Accept Quote
Previous Agreement Look up
Guided selling tool maps requirements to offerings Create initial proposal with all relevant options
Optional
Refine proposal (iterative)
Quote Acceptance
Previous Purchase History Look up Previous Quote History Look up Cross geo customer quoting Look up
Create final proposal
Profile defined
Escalate concession request
Optional indirect
Validate customer and proposal precredit check credit rating lookup
Concession process 215
Other process mapping models
(additional information)
ICOM
Input:
The material / information which enters in to the system with specified process capability
Input
Control
Process
Output
Control :
The systems, policies which control or governs the process.
Mechanism
Output :
The value added material / information through the process and entitled for next process
Single Process
Mechanism :
The entity which may consume or act as resource for processing. Eg. Machine, computer, Agent
fsdafdf
High Level Process Or Multiple processes
216
ICOM Model (additional information)

It can be used when - Team want to map processes hierarchically
Level 0
Business/Enterprise
Level 1
Basic process structure of the business
Increasing level of detail
1.1
Level 2
1.2 1.3
Sub-process
1.3.1 1.3.2 1.3.3
Level 3
Activities within Sub-process
217
ICOM Model Example (Process : Call Handling )

SOP SLA Customer Call Agent press Button to attend call Connected Call Database Rules of verification Rules of verification Data base Identified Data base Identified Type Genuine Identification Obtaining the Agent of call caller Of Type Requirement Verifies of call Of caller Caller & authorization Server, Software Agent training No Need to verify from supervisor? Yes Processed information Server, Software Agent training Soft skills Callers requirement Database SOP Searching and processing of information Server, Software Agents training & Process Knowledge SOP SLA Completed call Agent does after Call work (ACW) Completed ACW SOP SLA Agent press to button to give access to attend next call Agent ready to take next call
Peripheral
Database Information as requested Agent provides by caller information to caller Answered call Soft skills Satisfied caller
Hold call and Obtain information from supervisor
SOP SLA Termination of call Peripheral
Agent check for the Caller satisfaction
Soft skills Agents training
Server, Software Agents training & Process Knowledge
Peripheral
218

Process Mapping
2. Draw the process map for your process
219
Measure Phase
220
Main Activities
Measure
Tools used
Step 3: Take the snapshot of the process, how the process performing currently & fix the baseline. Step 4 : Validate the measurement system from which we collect the data.
Measure Phase Outcomes
Preparation Preparation
1. Select Process Team 2. Develop Process Map & Identify Process Steps 3. List Key Process Outputs To Satisfy Internal And External Customer Requirements 4. List Key Process Inputs For Each Process Step 5. Define Matrix Relating Product Outputs To Process Variables 6. Rank Inputs According To Importance
FMEA Process FMEA Process

7. List Ways Process Inputs Can Vary (Causes) and identify associated Failure Modes and Effects 8. List Other Causes (Sources of Variability) And Associated FM&Es 9. Assign Severity, Occurrence And Detection Rating To Each Cause 10. Calculate Risk Priority Number (RPN) For Each Potential Failure Mode Scenario
Improvement Improvement
11. Determine Recommended Actions To Reduce RPNs 12. Establish Timeframes For Corrective Actions 13. Create Waterfall Graph To Forecast Risk Reductions 14. Take Appropriate Actions 15. Re-calculate All RPNs 16. Put controls into place
Data Collection Plan
Gage R&R
Process Map
Failure Modes and Effects Analysis (FMEA)

Process or Product Name: Responsible:
Process Step/Part Number
Potential Failure Mode
Potential Failure Effects
S E V
Potential Causes
O C C
Current Controls
D E T
R P N
Actions Recommended
Resp.
FMEA Benchmarking
Baseline and target setting
Operational Definitions Measurement System Analysis Data Collection Formats and Plans Process Baseline capability Specification limits, target, defect definition for Project Y(s)
221
Measure Phase Topics

Data Collection Plan Operational Definition Develop Measurement Plan Data Collection Data Display and evaluation of Data
Fundamentals of Minitab
Basic Statistics Measures of Central Tendency Measures of Dispersion Probability Distribution
222
Measure Phase Topics

Gage R&R Gage R&R for Continuous Data Gage R&R for Attribute Data Process Capability Process Sigma Level Calculations
223
Why to Measure ?
If we cant accurately measure something We dont know enough about it
We cant control it We are at the mercy of chance!!!
224
Science of Six Sigma

When you measure what you are speaking about and express in numbers, you know something about it. Scientific Explanation : Very little progress is possible in any field of investigation without the ability to measure. The progress of measurement is in fact the progress of science ! Non Scientific Explanation : If you can not measure, just forget it ! It will be a sheer waste of time.
Without data you are just a loud mouth with an opinion ..

225
Foundation of six sigma is Data based decision making, Data drives decisions and actions !!!
226
What is data Data are measurements or observations we record and use to understand, characterize, optimize or control something such as process.
227
Knowledge is Power
Knowledge is not based on opinion, rather it is derived from facts & data.
In order to efficiently collect the data & effectively analyze it, to extract the maximum knowledge available, one must rely On statistical techniques.
228
Use of Statistics
Data
Statistics convert to
Usable Information
229

Decide objective
Step 1 Operational definition
Define a Metric
Step 2 Develop Measurement Plan Step 3 Data Collection
What, How, by Whom the measurement will be done
Stick to procedure/plan
Step 4 Data display
By Plotting (Graphing) the Data, the result can be easily understood.
Evaluation of Data
230
Operational Definition
An operational definition is a precise description of the specific criteria used for the measures (the what), the methodology to collect the data (the how), the amount of data to collect (how much) and who has the responsibility to measure the data
When developing an operational definition, it is important for the team to fully understand and agree that the DEFINITION reflects exactly what information the team is attempting to gather on the process.
Clarity is more important when developing and selecting the measures that will be used to determine the SIGMA PERFORMANCE of the process.
231
Example :
Operational definitions may determine whether, a team is required to count all the defects on an invoice (required to calculate defects per million opportunities) or
the total number of defective invoices (any invoice with any defect) or the type of defects encountered on an invoice (to eliminate the most common defects first). Each of these cases may require a very different approach for gathering the data.
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Operational definition provides the foundation for the team to
1. Reach an agreement on what data to be collected. 2. Build consistency and reliability into data collection. 3. Fully agree on how a particular characteristic of a process is to be measured.
233
Example of Operational Definition.

Poor Operational Definition: Cycle time of a transaction Good Operational Definition: Collect data for all transactions processed from 1-Aug-05 to 31-Aug-05. The cycle time of each transition will be determined by the date and time of transaction download from client server by an agent/CSR to the date and time of the PROCESSED transaction was submitted in client server as per the client server system time.
234
Exercise: Operational Definition

Write operational definitions for the following cases
1) Maximization the server availability

2) Reduction of the attrition rate in ABZ 3) Improving the quality percentage a process 4) Reduction of call handling time 5) Minimization of abandoned calls in a call center
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Develop Measurement Plan

Measurement Plan Determining current process performance usually requires the collection of data. When developing a measurement plan ensure that: The data collected is meaningful The data collected is valid All relevant data is collected concurrently
What is the Purpose of Collecting the Data? Will it serve the purpose ? How will you collect the data?
-what result will you measure? -what kind of cause will you analyze for the ineffective process?
What kind of tool will be required?

-form, check sheet ?
All related Data collected? -Sample size, frequency, sampling method? Is the Data Collecting method is adequate? -who will collect the data? -where can we collect the data? -when will we collect the data? -what kind of assistance will be necessary?
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Data Classification
Before data collections starts, classify the data into different types: continuous or discrete. This is important because it will:
Provide a choice of data display and analysis tools
Dictate sample size calculation

Provide performance or cause information Determine the appropriate control chart to use Determine the appropriate method for calculation of Sigma
237
Types of Data
Continuous Data
Description
Discrete Data
Binary : Classified into one of two categories
Measured on a continuum or scale
Count : Counted discretely Ordered categories : Rankings or ratings
Example
% of applications with or without errors.
Time (in hours) to process an application Number of errors in an application. Customer satisfaction rating of call center service. 238
Continuous Data
Data generated by Physically measuring the characteristic Generally using an instrument Assigning an unique value to each item
Continuous Data: Example (Call Waiting Time in Secs)
SL No. Waiting Time 98 103 100 100 99 101 97 102 100 99 SL No. 11 12 13 14 15 16 17 18 19 20 Waiting Time 102 98 101 101 99 100 101 99 100 102
Examples: 1. The time it takes to write a proposal. 2. The time it takes to conduct a feasibility study. 3. The time it takes to close the books each month. 4. Invoice amounts. 5. Sales order amounts. 6. Handling Time, Time to Certify PEs, etc.
1 2 3 4 5 6 7 8 9 10
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Discrete Data
Data generated by
Good
NOGO
GO
Bad
Classifying the items into different groups based on some criteria All the items classified into a group will have same value
Examples:
Gender, Shade Variation, etc. Escalations, Repeat Calls, Defective Transactions, Defects in Transactions etc.
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Defects versus Defective

Out of these 09 Invoices
Quantity: AAAAA Price: $BBBBB Date: YY/YY/YY
tgxkvlzzvz zlkjzljvzzz oerriovfzz zxljzppopgz zljvodldzz czvkjozddz erioitnm
there are...


3 Defective Invoices 6 Defects






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Example of Opportunities
Quantity: AAAAA Price: $BBBBB Date: YY/YY/YY tgxkvlzzvz zlkjzljvzzz oerriovfzz zxljzppop gz zljvodldzz czvkjozddz erioitnm
Only three line items on this invoice are critical to the customer. ( Quantity, Price, Date)
Errors in the rest of the invoice are not critical
Hence, there are 3 opportunities per invoice even though the invoice contains more than 3 line items.
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Discrete : Binary Data (Binomial)

Classifying the items into only two groups based on some criteria Each item will fall in either of the two groups All the items classified into a group will have same value Expressed or summarized as proportion p or percentage
Examples:
Gender, Escalations, Repeat Calls, Defective Transactions, etc An invoice is either complete or incomplete. A delivery is either late or not late. A product is either damaged or not damaged. A hotel room is either dirty or clean. A sales pitch is either a thumbs up or thumbs down.
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Binary Data : Example

(Month wise Escalation of Transactions)
Month Jan Feb No. of Transactions Processed 2000 2500 No. of Transactions Escalated 20 30
Mar
Apr May Jun
1500
3000 4000 3500
14
27 40 33
Proportion of Escalated Transactions p = No. of Transactions Escalated / Total No. of Transactions Processed = (20 + 30 + 14 + 27 + 40 + 33) / (2000 + 2500 + 1500 + 3000 + 4000 + 3500) = 164 / 16500 = 0.0099 0.01 = 1 % On an average, 1 % of Transactions are escalated
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Discrete : Count Data (Poisson)

Data generated by
Counting the exact number of occurrences of the characteristic in a group of items.

It takes integer values as 0,1,2,-,-,-, Expressed or summarized as average number of occurrences
Examples:
Number of fatal defects in transactions processed Number of accidents in the city during June 2005 Number of suicides in the city during 2004. The number of errors on twenty invoices. The number of computer system failures in a month.
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Count Data: Example

(Data on Defects found during Transaction Audit)
No. of Items Audited
No. of Defects
100
3
50
4
76
0
82
1
172
5
150
10
89
1
Average Number of Defects = Total No. of Defects / Total No. Audited = (3 + 4 + 0 + 1 + 5 + 10 + 1) / (100 + 50 + 76 + 82 + 172 + 150 + 89 ) = 0.033 On an average 0.033 defects found per Transactions On an average 3.3 defects found per 100 Transactions
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Type of Data
2. Identify the type of data given in example
247
Data Measurement Plan Format

Performance measure Operational Definition Data Source & location Sampl e size Who will collect the data Raju Smita Data collection period How will date be collected
Cause Data
Other data that should be collected at the same time
Time to process a transaction
Date and time of transaction was download from client server by an agent to the date and time of the PROCESSED transaction was submitted in client server
Client server system time.
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1-Aug-05 to 31-Aug-05
Random selection
Type of transaction, Day of week, Agent name
The data is being collected to measure the performance is called PERFORMANCE DATA. On the other hand, CAUSE DATA, focus on why the process performs as it does. Cause data supports the problem solving by helping to isolate root causes of the problems. Most of the times, however, we wont know enough about potential causes until we have determined our processes current performance level. Be prepared to document current performance first, then brainstorm potential causes and collect additional data related to those causes at a later date.
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Data Collection
While collecting data ensure that the data measurement plan is followed. Note any deviations from the plan. Avoid bias and ensure consistency. Use various tools like check sheets to record and grouping of the data.
Ensure that the sample selected is representative of the population. If there is any concern on this issue, record the things that may cause the data collected to not be representative of the population.
Data Rich Ensure Effective and Efficient Data Collection
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Poor Information
Sampling
250
Sampling Objectives
Understand the purpose and advantages of sampling Understand the application of different sampling techniques to ensure accurate process representation Gain experience in asking appropriate questions to ensure a robust sampling plan is implemented effectively and efficiently Understand guidelines and formulas used to determine sample size
251
Basic Definitions and Symbols

Population (N): The entire set of objects or activities for a process : the mean (arithmetic average) calculated for a population : the standard deviation calculated for a population
Sample (n): a group that is a part or subset of a population x: the mean (arithmetic average) of a sample
s: the standard deviation of a sample
252
Sampling Definition
Sampling is the process of: Collecting only a portion of the data that is available or could be available, and drawing conclusions about the total population (statistical inference)
Population
x x x x x x x x x x x x x x x x x x x x x N = 5000
Sample
x x x x x x x x
n = 100
Example: Estimating the average height of students in a college by measuring the heights of only 250 students (250 is a subset of entire students population).
253
Sample .. When ?
When to .. Collecting all the data is impractical or too costly Data collection can be a destructive process When measuring a high-volume process When not to A subset of data may not accurately depict the process, leading to a wrong conclusion (every unit is unique-e.g., structured deals)
254
Kinds of Sampling
Random Sampling This sampling ensures that the characteristics of the population are collected with equal possibility.
Stratified Sampling Make stratifying plan for population characteristics. Select the sample among each stratified group
Group A
Group B
255
Frequency of Sampling
Recommended more often for unstable processes (Systematic, Subgroup sampling) Recommended less than usual for stable processes. To make a useful business decision we have to decide the precision of data and frequency of data.
256
Sampling: Methodology
Select a sample of items from the population Measure the characteristics on each item in the sample Calculate the sample statistics Provide the sample statistics as an estimate of population statistics
257
Methodology: Example
To estimate the average height of students in a college
Select a sample of items from the population, say 250 students
Measure the characteristics on each item in the sample i.e. measure the height of all the 250 students in the sample
Calculate the sample statistic i.e Calculate the average height of 250 students ( = 5.5 feet)
Provide the sample statistic as an estimate of population statistics Estimate of average height of students in the college = 5.5 feet
258
Methodology: Issues
The following are the Waiting Times (Seconds) values of 36 Calls:
10 50 40 30 60 26 30 40 34 25 35 17 34 25 20 15 30 50 52 20 37 12 10 24 30 40 16 24 10 10 20 10 40 50 20 32
Mean Waiting Time = 28.55
The following data is a sample of 10 from the above data:

30 34 17 10 24 12 16 50 50 10
Sample Mean = 25.3 Sample Statistics may not be exactly equal to Population Statistics
259
Methodology: Issues
The following data is another sample of 10 from the parent data:
26 40 34 30 20 16 10 50 20 32
Sample Mean = 27.8
The estimate may vary from sample to sample
To overcome these issues Confidence Intervals are developed
260
Confidence Interval: Methodology

Select a sample of items from the population Measure the characteristics on each item in the sample Calculate the sample statistics
Provide two limits: an upper bound & a lower bound to the population statistics such that the true value of population statistics will lie within these limits with a specified level of confidence
261
Continuous Data: CI for Population Mean

Select a sample of n items from the population Measure the characteristics on each item in the sample Calculate the sample Mean & Standard Deviation (SD). Then
(1-) % Confidence interval : Sample Mean Constant (confidence level) x Standard Error (SD of Sample Mean)
262

(1-) % Confidence interval on Mean: Sample Mean Z /2 x SD / n Z /2 is the Standard Normal variate for an area of /2 as shown in figure
4 3 2 1 0 -3 -2 -1 0 1 2 Z /2 3
263
/2
0.05 0.01 0.10
CI 95 % 99 % 90 %
Z /2 1.96 2.57 1.64
Obtained from Z table
264
CI for Population Mean: Example

The following are the Waiting Times (Seconds) values of 36 Calls:
10 50 40 30 60 26 30 40 34 25 35 17 34 25 20 15 30 50 52 20 37 12 10 24 30 40 16 24 10 10 20 10 40 50 20 32
Mean Waiting Time = 28.55 The following data is a sample of 10 from the above data:
30 34 17 10 24 12 16 50 50 10
Sample Mean = 25.3 Sample SD = 15.34

265
CI for Population Mean: Example

95 % Confidence interval on Mean: Sample Mean 1.96 x SD / n = 25.3 1.96 x 15.34 / 10 = 15.79 to 34.80
Similarly, 2nd Sample:

26 40 34 30 20 16 10 50 20 32
Sample Mean = 27.8
Sample SD = 11.94
95 % Confidence Interval on Mean: 27.8 1.96 x 11.94 / 10 = 20.39 to 35.20
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CI for Population Mean
2. Calculate CI for a given example
267
Discrete Data: CI for Proportion

Collect a sample of size n from the population Calculate sample proportion p Calculate Standard error (SE): (p(1-p)/n) Then
(1 - ) % CI interval for Population Proportion:

p Z /2 x (p(1-p)/n) 95 % CI interval for Population Proportion:
p 1.96 x (p(1-p)/n)
268

CI for Discrete data
2. Calculate CI for a given example
269
Sample Size Calculation: Continuous Data

Using 95 % CI True value of population Mean will lie between Sample Mean 1.96 SD / n Then Population Mean - Sample Mean < 1.96 SD / n ( with 95 % Confidence) Hence To estimate the population mean with an accuracy of say 5 I.e Population Mean - Sample Mean < 5 I.e 5 = 1.96 SD / n n = (1.96 SD / 5)2 Sample Size required to estimate population mean with an accuracy of 5: (1.96 SD / 5)2
270
Sample Size Calculation: Methodology Continuous Data
Collect a small sample
Calculate Sample Mean & Standard Deviation Equate accuracy required to 1.96 SD / n
Solve for n
271

Sample Size Calculation for continuous data
2. Calculate sample size for a given example
272
Sample Size Calculation: Discrete Data

Using 95 % CI True value of population proportion will lie between p 1.96 x p(1-p) / n where p is sample proportion Then Population Proportion - Sample Proportion < 1.96 x p(1-p) / n
Hence
To estimate the population proportion with an accuracy of say 0.01 I.e Population proportion - Sample proportion < 0.01 I.e 0.01 = 1.96 x p(1-p) / n n =1.962 p (1-p) / 0.012 Sample Size required to estimate population proportion with an accuracy of 0.1: 1.962 p (1-p) / 0.012
273
Sample Size Calculation: Methodology Discrete Data

Collect a small sample
Calculate Sample proportion p
Calculate Standard Deviation (p(1-p) / n)

Equate accuracy required to 1.96 (p(1-p) / n)
Solve for n
274

Sample Size Calculation for discrete data
2. Calculate sample size for a given example
275
Data Display and Evaluation

Once we collect the data, it is always preferable to evaluate the data for its accuracy and usage prior to calculation of the capability of the process As a initial step, display the data using Patero charts, Scatter plot, control charts, Histogram or Normality etc to look for data errors, trends and outliers. Be prepare to collect more data or different data based on the above observations.
Evaluate the data to confirm that the data is dependable, consistent, reliable and representative.
Also ensure that, we get similar results if we repeat the data collection.
Finally confirm that the data collected provide the information we need.
276
Fundamentals of Minitab
(Statistical Package)
277
Once you start Minitab, Minitab opens with two main windows.
Session Window It displays the results of your analysis in text format.

Column
Data Window It contains an open worksheet, which is similar in appearance to a spread sheet. We can open multiple work sheets.
Row Cell
278
Column with Text data
Column with Numeric data
Column with date/time data
Column Name To be written by us
Row Number
All the columns are formatted by default to Numeric data. As per the requirement we can reformat the columns. Right click mouse>Format Column>numeric/text/date.
279
File
Most of the functions of the File Menu are similar to Excel sheet. Open existing or new files Save file Print files, etc.
Edit
Most of the functions of the File Menu are similar to Excel sheet.
Cuts, Paste cells, Undo, redo Clear cells etc.

280
Data
It is very useful function menu in Minitab. to immunize the duplicate data entry in the work sheets. Using this menu, we can subset the worksheets, split and merge work sheets. Minitab automatically opens multiple data windows. We can transpose and sort the columns. Group of the points from the graphs can be selected and corresponding data subset can be stored in separate work sheet.
281
Calc
Calculator: Data in various columns can be computed and stored in separate column Column and Row statistics: Various statistics like mean, SD etc can be calculated for the data listed in the column / row
Random data: Can be generated for all the distributions

Probability Distribution: All the distribution statistics can be calculated.
282
Stat
All sorts of statistical analysis can be done for the data stored in various columns in the work sheet.
Graphs
Various graphs can be plotted using this menu
Editor
Used for Formatting of the columns
283
Basic Statistics
284
Describe Sets of Continuous Data

The following three characteristics can describe the continuous data set
1. Measures of Central Tendency

1. Mean 2. Median 3. Mode
2. Measures of Dispersion
1. Range 2. Variance 3. Standard Deviation
3. Shape
1. Histogram
285
Continuous Data: Measures of Central Tendency
1. Mean
2. Median
3. Mode
286
Mean: Numerical value indicating the central value of data Sum of all observations / Total number of observations Suppose x1, x2, - - - xn be the data, then Mean = (x1+ x2 + - - -+ xn ) / n = xi /n Mean: Sum of all observations / Total number of observations
Continuous Data : Example Call Waiting Time = (98 + 103 + 100 + 100 + 99 + 101 + 97 + 102 + 100 + 99 + 102 + 98 + 101 + 1.01 + 99 + 100 + 101 + 99 + 100 + 102) / 20 = 200.2 / 20 = 100.1 Minutes
287
Median:
Middle Value Value which divides observations arranged in ascending or descending order into two equal halves Case 1: Total number of observations is odd Median: Middle Value Case 2: Total number of observations is even Median: Average of two middle values
Median: Example Call Waiting Time in Minutes

97
100
98
100
98
101
99
101
99
101
99
101
99
102
100
102
100
102
100
103
Total Number of observations: 20 (even) The middle Values : 100 & 100 (10th value and 11th value) Median: Average of 2 middle values = (100 + 100) / 2 = 100
288
Mode:
The observation which occurs maximum number of times in the data
Example Call Waiting Time in Minutes

97 100 98 100 98 101 99 101 99 101 99 101 99 102 100 102 100 102 100 103
Total Number of observations: 20 (even) The observation with maximum number of occurrences : 100 Mode: 100
289
Continuous Data : Measures of Dispersion
1.Range
2.Variance
3.Standard Deviation
290
Range: Definition
Range: Maximum value Minimum Value
Example:
5 15 4 9 7 8 3 5 2 2
Maximum Value = 15 Minimum Value = 2 Range = 15 2 = 13
291
Range: Issues
It depends only on extreme values Hence affected by outliers
16 14 12 10 8 6 4 2 0 1 2 3 4 5 6 7 8 9 10
Range
Better measure of Dispersion is Standard Deviation

292
Standard Deviation: Definition

Square root of the average squared deviation from mean Indicates On an average how much each value is away from the Mean
Example :
5 15 4 9 7 8 3 5 2 2
Step 1: Calculate Mean = (5+4+7+3+2+15+9+8+5+2) / 10 Mean = 6
293
Example: Standard Deviation

Step 2: Take deviations from Mean
16 14 12 10 8 6 4 2 0 1 2 3 4 5 6 7 8 9 10
-1 9
-2 3
1 2
-3 -1
-4 -4
294
Step 3: Since some values are positive & rest are negative, while taking sum they will cancel out. So square the values & Sum 1 81 4 9 1 4 9 1 16 16
Sum of Squares = 142
295

5 15 -1 9 1 81 4 9 -2 3 4 9 7 8 1 2 1 4 3 5 -3 -1 9 1 2 2 -4 -4 16 16 Step 1: Calculate Mean, Mean = 6
Step 2 : Take deviations from Mean

Step 3: Since some values are positive & rest are negative, while taking sum they will cancel out. So square the values & Sum
Sum of Squares = 142
Step 4: Standard Deviation = (Sum of Squares / (n -1)) = (142 / (10 -1)) = 15.77 = 3.972 Variance = (SD)2 = 15.77
296
Standard Deviation: Example 2

Data x1 x2 x3 x4 x5 x6 x7 x8 x9 x10 Sum n Mean 98 103 100 100 99 101 97 102 100 99 999 10 99.9 (xi Mean) -1.9 3.1 0.1 0.1 -0.9 1.1 -2.9 2.1 0.1 -0.9 3.61 9.61 0.01 0.01 0.81 1.21 8.41 4.41 0.01 0.81 28.9
Call Waiting Time in Minutes
(xi Mean)2
S D = (28.9) / (10 1) = 1.7919
297
Continuous Data: Graphical Representation of Data: Histogram

Example: Call Waiting Time Data 97 100 98 100 98 101 99 101 99 101 99 101 99 102 100 102 100 102 100 103
Total Number of observations : 20

Minimum Value Maximum Value Number of Classes : 97 : 103 : n = 20 = 4.47 5
Class Interval : (Maximum Minimum) / Number of Classes : (103 97) / 5 = 1.2
298
Construction of Frequency Table

Lower Limit of a Class 1st Class Lower Limit : Minimum Value Lower Limit of any class other than 1st class : Upper Limit of Previous Class Upper Limit of a Class Lower Limit of the Class + Class Interval
Construction of Frequency Table

SL No 1 2 Lower Limit 97 98.2 Upper Limit 98.2 99.4 Tally Marks lll llll Frequency 3 4
3
4 5
99.4
100.6 101.8
100.6
101.8 103
llll
llll llll
5
4 4
299
Graphical Representation of Data: Histogram
6 5 4 3 2 1 0 98.2 99.4 100.6 101.8 103
300

Mean, Median, Standard Deviation and histogram
2. Calculate Mean, Median, Standard Deviation and construct histogram for a given example
301
Probability & Normal Distribution
302
Probability Definition
Ratio of number of favorable outcomes to total number of outcomes
Example Number of tosses of a coin = 100 Number of times Head occurred = 49 Number of times Tail occurred = 51 Probability of getting Head in a toss of coin =Number of Times Head occurred / Total number of tosses = 49/100 = 0.49 = 0.5 (Approximately)
303
Example 1 :
The day wise average waiting time in seconds (AWT) of calls for 10 days is given below:
50 61 58 55 56 55 48 54 62 51
a. Calculate the probability that average waiting time > 60 Seconds?

b. Calculate the probability that average waiting time < 50 seconds
a. Probability of AWT > 60 = Number of cases with AWT > 60 / Total number of cases = 2 / 10 = 0.2 20 % of the days AWT will be more than 1 Minute b. Probability of AWT < 50 seconds = Number of cases with AWT < 50 / Total number of cases = 1 / 10 = 0.1 10 % of the days AWT will be less than 50 seconds
304
Example 2 :
The number of transactions processed per day by 40 member team for 12 days during transition is given below:
750 810 780 750 760 740 690 775 725 796 743 765 820 735
Suppose the SLA on productivity is minimum 720 transactions per day, calculate the risk of not meeting the SLA? Risk of not meeting SLA = Probability that productivity < 720 transactions = Number of days with Productivity < 720 / Total number of days
= 1 / 14 = 0.071
Risk of not meeting SLA is 7 %
305
Issues
To estimate probability using this method,
huge amount of data is required
Solution
When data is less, identify the underline distribution & estimate probability from the distribution
306
Statistical Distributions
Continuous distribution Normal distribution Discrete distribution
Binomial distribution
Poisson Distribution
307
Normal Distribution
Definition: Consider the following data on Average Handling Time (AHT) in minutes of 16 Days:
2.3 2.5 2.7 2.4 2.4 2.5 2.6 2.6 2.3 2.2 2.7 2.8 2.5 2.4 2.5 2.6
Plot of the Data:

5 4 3 2 1 0 2.1 2.3 2.5 2.7 2.9
308
Plot of the Data:

3
0 2.2 2.3 2.4 2.5 2.6 2.7 2.8
Bell Shaped Symmetric Total Area under the curve is 1 Then : Normal Curve & Data follows Normal Distribution
309
Normality Test : Probability Plot using Minitab

Step1: Copy the data to Minitab worksheet column Step 2: Choose Stat > Basic Statistics > Normality Test
310
Step3: Enter the Column Title to the Variable Text Box and Click OK button
311
Step 4: Minitab Output
Interpretation: If P-Value 0.05, then Data is Normal

312
Standard Normal Distribution

If
Data follows Normal Distribution

then (Data - Mean) / SD will follow Standard Normal Distribution
For Standard Normal Distribution:

Mean = 0 SD = 1
313
Standard Normal Distribution: Example

Data:
2.3 2.5 2.7 2.4 2.4 2.5 2.6 2.6 2.5
Mean = 2.5 SD = 0.1225 Z : (Data - Mean ) / SD

-1.633 0.00 1.633 -0.8165 -0.8165 0.00 0.8165 0.8165 0.00
Mean = 0.00 SD = 1.0
314
Standard Normal Distribution: Properties
Between
3 2 1 0 -3 -2 -1 0 1 2 3
Mean 1 SD : 68.26 % of Values will lie Mean 2 SD : 95.46 % of Values will lie Mean 3 SD : 99.73 % of Values will lie
68.26% 95.46%
99.73%
315
0 2.3 2.4 2.5 2.6 2.7
If data follows normal distribution, then the probabilities can be estimated from Normal Curve
Example:
The probability that AHT will be more than 2.6 Minutes is the area above 2.6 Minutes in Normal Curve
316
0 2.3 2.4 2.5 2.6 2.7
Example: The probability that AHT will be less than 2.35 Minutes is the area below 2.35 Minutes in Normal Curve
317
Normal Distribution: Examples

The Time to Certify PEs is normally distributed with mean 40 days and standard deviation 8 days. If the client wants that all PEs shall be certified within 34 to 48 days, estimate the chance of meeting client requirement? Mean = 40
SD = 8
Let x be the Time to Certify PE Case 1: Probability of certifying PEs within 34 days
P(x < 34)

Transforming to Standard Normal P[((x - Mean) / SD ) < ((34 - 40)/8)] = P ( z < -0.75)
318

Case 1: P ( z < -0.75)
4 3 2 1 0 -3 -2 -1 0 1 2 3
From Standard Normal Tables P(z < -0.75) = 1 0.7733 = 0.2266

319
Case 2: Probability of certifying PE in > 48 days
P ( x > 48) = P (z > (48 - 40) / 8) = P ( z > 1)
4 3 2 1 0 -3 -2 -1 0 1 2 3
320

Case 2: From Standard Normal Tables P (z > 1 ) = 0.1587
Chance of Meeting Client Requirement = 1 0.2266 - 0.1587 = 0.6147 = 61.47 %

OR Chance of Meeting Client Requirement = 0.7733 - 0.1587 = 0.6147 = 61.47 %
4 3 2 1 0 -3 -2 -1 0 1 2 3
321
Exercise 1.16.1 (20 minutes)

Probability distribution for continuous data
2. Calculate probability distribution for a given example
322
Handing Non normal data
323
Binomial Distribution:
If the data is binary, then probabilities are estimated using Binomial Distribution
324
Binomial Distribution: Example

On an average, 2 % of the transactions processed in a process are defective. On a particular day, out of 400 transactions audited 21 turned out to be defectives. Is it an indication that the process performance deteriorated? Let p = 2 % = 0.02 Number of Transactions Audited (n) = 400 Number of Defectives (d) = 21 The probability of getting 21 defectives out of 400 when p = 2 % = 0.02 is calculated using Binomial Distribution as shown below
P(getting x = 21 defectives out of 400 transactions) = nCxpx(1-p)n-x

=
400C 0.0221(1-0.02)400-21 21
325

Let p = 2 % = 0.02
Number of Transactions Audited (n) = 400

Number of Defectives (d) = 21 The probability of getting 20 defectives out of 400 when p = 2 % = 0.02 is calculated using Binomial Distribution as shown below P ( x 20) = P ( x = 0 ) + P ( x = 1 ) + P ( x = 2 ) + - - - + P ( x = 20) P ( getting x = 20 defectives out of 400 transactions ) = nCxpx(1-p)n-x =
400C 0.0220(1-0.02)400-20 20
326
Calculation of Binomial Probabilities using Minitab

Step 1: Copy the defective data to Minitab Worksheet as shown below:
327

Step 2: Go to Calc Probability Distributions Binomial
328

Step 3: Select Cumulative probability, Enter Number of trials, Probability of success, Input Column, Option Storage and click OK button
329

Step 4: Minitab will calculate Binomial Probabilities as display in Optional Storage Column as shown below
Note: % Chance = Probability x 100

330

p = 2 % = 0.02 From Binomial Distribution, Number Audited (n) 400 400 400 400 400 400 400 400 400 400 400 Defectives (d) 0 2 4 6 8 10 12 14 16 18 20 Chance of getting d or less defects (%) 0.03 1. 31 9.73 31.09 59.26 81.79 93.81 98.38 99.66 99.94 99.99
331

Let p = 2 % = 0.02
Number of Transactions Audited = 400

From Binomial Distribution, Probability of getting less than 20 defectives in 400 transactions = 0.9999 Hence Probability of getting 20 or more defectives = 1 0.9999= 0.0001 0 i.e. if the process is operating at 2 % defectives: the chance of getting 21 defectives out of 400 is almost 0 , Process performance is deteriorated.
332

Probability distribution for Binomial Distribution
333
Poisson Distribution:
If the data is Count, then probabilities are estimated using Poisson Distribution
334
Poisson Distribution: Example

The average number of repeat calls per day in a voice process is 20. On a particular day , there were 25 repeat calls. Is there any problem with the process that day? Let : Average number of Repeat Calls = 20 The probability of getting x 24 calls when average number of repeat calls is 20 is calculated using Poisson distribution as follows P ( x 24) = P ( x = 0) + P ( x=1)+ P ( x = 2) + - - - + P ( x=24) P ( x = 24 when = 20) = e-x / x! = e-202024 / 24!
335
Calculation of Poisson Probabilities using Minitab

Step 1: Copy the different values of repeat calls to Minitab worksheet as shown below:
336

Step 2: Go to Calc Probability Distributions Poisson
337

Step 3: Choose Cumulative probability, Enter Mean, Input column & Optional storage as shown below and click OK button.
338

Step 4: Minitab will display the probabilities in the Optional storage column as shown below
Note: % Chance = Probability x 100

339

Average number of repeat calls per day = 20 Average Repeat Calls Repeat Calls (d) Chance of getting d defects or less (%)
20
20
0
5
0.00
0.01
20
20 20 20
10
15 20 24
1.08
15.65 55.91 84.32
340

Average number of repeat calls per day = 20
From Poisson Distribution,

Probability of getting less than 25 repeat calls = 0.84 Hence Probability of getting 25 or more repeat calls = 1 - 0.84= 0.16 = 16 % i.e. if the process is operating at 20 repeat calls per day: the chance of getting 25 repeat calls is 16 % 16 % is large enough to conclude that there is nothing wrong in the Process.
341

Probability distribution for Poisson Distribution
342
Gauge R&R (Measurement System Analysis)
343
Introduction
When ?
Identify the Project Define Measure
Identify Y(CTQ)
Gage R&R for Y
Data Collection Baseline
Baseline Process Capability
Gage R&R is pre-requisite for data collection / analysis
Gage R&R study is a method to evaluate measurement system to determine the amount of variation it contributes to the total observed process variation.
In Manufacturing industries, gages are evaluated for repeatability (of readings when a component is measured multiple times) and Operators / inspectors are evaluated for reproducibility (of same readings when the component is measured by different operations). In service industries, Appraisers will be assessed instead of Gage
344
Importance of Gauge R&R

It is a method to determine how good the data is A Simple method to aid in improving the measurement system A simple method to evaluate new gage / agents repeatability A simple method to quantify measurement reproducibility
Examples
A black belt wants to reduce the variability in transaction time A black belt wants to improve the quotation process
A black belt wants to assess the process knowledge of the agents
345
Measurement System What is Measurement ?

To give the value to express specific function of a certain material.
What is Measurement System ?

A given value is called measurement data. All equipment and tools to get the measured data are termed gage. Gage, operator, software, measurement method and process are termed as measurement system.
346
Why Worry about Measurement Variation?

Consider the reasons why we measure:
Verify product/process conformity to specifications
Process Measurement
How might measurement variation affect these decisions? What if the amount of measurement variation is unknown
Assist in continuous improvement activities

Process Measurement
Measurement variation can make our process capabilities appear worse than they are.
347
Accounting For Changes

While we can come up with many explanations, they would fit into three general categories
Simple Day-to-day Random Variation An Event That Changed the Distribution of Calls Coming in to Agents A Difference in How Calls Are Classified Between You and the People Classifying Calls Yesterday Expected Variation A Change to the Process
A Change to the Measurement System
How Can We Determine the Cause?

348
Sources of variation
Product Variability (Actual variability)
Measurement Variability
Total Variability (Observed variability)
349
Observed Process Variation
Actual Part to Part Variation Long Term Process variation
Measurement Variation
Within Sample Variation
Variation due to operators
Variation due to Gage
Short Term Process variation
Reproducibility Issue
Repeatability Issue
2Total = 2Part-Part
2R&R
To study & reduce the process variation the measurement variation has to be identified and separated from process
350
Accuracy (Bias)
The difference between the observed average of measurements and the true average of the items measured.
Accuracy
Observed Average
True
Average
351
Repeatability
The variation due to the Gauge. The variation observed when the same Appraiser monitors/evaluates the same transaction repeatedly using same facilities / aids. Master Value Poor Repeatability
Good Repeatability
Mean
Mean
352
Reproducibility
Appraiser to Appraiser Variation The variation observed when different Agents process the same transaction using the same facilities / aids.
Master Value
Good Reproducibility
Poor Reproducibility
Operator 1 Operator 2 Operator 3
Operator 1 Operator 2 Operator 3

353
Stability
The variation in the average of at least two sets of measurements obtained with a gage as a result of time on the same pieces.
Stability
Time 1
Time 2
354
Methods of performing Gage R&R Studies.

Xbar-R Method
Continuous Data
General use. It does not evaluate the interaction effect.
ANOVA Method
It evaluates the interaction effect of the agents also. More effective when extreme values are present
Discrete Data
Attribute Agreement Analysis

355
Exercise: Gage R & R Continuous Data

Given the data below for reading by 3 appraisers on 6 calls with 2 trails, determine whether the measurement system is acceptable Call ID Appraiser A 1 2 Appraiser B 1 2 Appraiser C 1 2
1
2 3 4 5 6
65
100 85 85 55 100
60
100 80 95 45 100
55
100 80 80 40 100
55
95 75 75 40 100
50
100 80 80 45 100
55
100 80 80 50 100
356
Gage R & R Continuous Data

Step 1: Copy the data to Minitab worksheet as shown below
357

Step 2: Choose Gage R&R Study (Crossed) from Stat Menu as shown below:
358

Step 3: Enter Part Numbers, Operators & Measurement Data.
Choose Xbar and R as shown below

Click OK button
359

Step 4: Minitab will give the following Output
Source Total Gage R & R Repeatability Reproducibility Part-To-Part Total Source Total Gage R & R Var Comp 17.434 7.338 10.096 411.568 429.002 StdDev (SD) 4.1754 % Contribution 4.06 1.71 2.35 95.94 100 (6 * SD) 25.052 (%SV) 20.16
Repeatability
Reproducibility Part-To-Part Total Variation
2.7088
3.1774 20.2871 20.7154
16.253
19.065 121.723 124.274
13.06
15.34 97.95 100
If < 20 %. Gage acceptable Else if > 30 %, Gage not acceptable Else some problem with gage, use with caution
360

Step 5: Graphical Output 1
Gage R&R (Xbar/R) for Data
G age name: D ate of study : Reported by : T olerance: M isc:
Components of Variation
100
% Contribution % Study Var
80
Percent
60
40
20
Gage R&R
Repeat
Reprod
Part-to-Part
Graphical Representation of the first table in the previous slide

361

G age name: D ate of study : Reported by : Tolerance: M isc:
Xbar Chart by Appraiser

100 A B C _ _ UCL=83.11 X=77.36 LCL=71.61
Sample Mean
80 60 40
R Chart by Appraiser
10 A B C UCL=9.98
Sample Range
_ R=3.06 LCL=0
Interpretation: All points in R chart should be within the control limits for all Appraisers Xbar chart for all appraisers should have more or less same pattern and most of the points should fall outside control limits.
362

Data by Call Id
100 90 80 70 60 50 40 1 2 3 Call Id 4 5 6
Interpretation: All readings for each call is shown with their means connected. Ideally the variation around mean for different calls should be equal and minimum.
363

Data by Appraiser
100 90 80 70 60 50 40 A B A ppraiser C
Interpretation: All readings for each appraiser is shown with their means connected. Ideally the variation around mean for different appraisers should be equal and minimum. 364

Appraiser * Call Id Interaction

100 90 80
Appraiser A B C
A verage
70 60 50 40 1 2 3 Call Id 4 5 6
Interpretation: Ideally the lines should overlap or at least parallel. Large deviations from parallelism indicates lack of agreement among appraisers with respect different calls. 365
Gage R&R for Continuous Data

Example: Gage R & R for Transition Cycle Time
A Team Lead in a finance related data process is responsible to monitor and control the cycle time a sub-process. This sub-process is well established and consumes almost equal amount of time to process each transaction. Over period of time volumes are increased and agents are also increased proportionately. But he observed that currently, the variation in cycle time is very high and not meeting the SLA some times. He wondered how it can happen? He is in doubt about the agents capability and likes to measure and assess the same.
He chosen 2 agents and 10 transactions. He has conducted Gage R&R study by processing each transaction twice by each agent. The transactions are selected on random basis for the processing.
366
Summary of Case Study (Manual Calculations)

10 Transactions, 2 Agents Each Agent processed each transaction twice Data Collection
Transaction 1 2 3 4 5 6 7 8 9 10 Agent 1 1 2 21 20 24 23 20 21 27 27 19 18 23 21 22 21 19 17 24 23 25 23 Agent 2 1 20 24 19 28 19 24 22 18 25 26 2 20 24 21 26 18 21 24 20 23 25
367
Gage R & R: Example

Repeatability: Variation due to measurement instrument
Variation occurs when same operator measures the same part again and again
Operator 1 2 Range 20 1 23 1 21 1 27 0 18 1 21 2 21 1 17 2 23 1 23 2 Rbar 1.2 Operator 2 2 20 24 21 26 18 21 24 20 23 25 Rbar
Part 1 2 3 4 5 6 7 8 9 10
1 21 24 20 27 19 23 22 19 24 25
1 20 24 19 28 19 24 22 18 25 26
Range 0 0 2 2 1 3 2 2 2 1 1.5
368
Gage R & R: Example

Repeatability: Variation due to measurement instrument
Variation occurs when same operator measures the same part again and again
Variation due instrument : Average of Rbars
= 1/2(1.2 + 1.5) = 1.35

Repeatability (EV) = K1 x Average Rbar = 1.19681
Trails
2 3
K1
0.8862 0.5908
369
Gage R & R: Example

Reproducibility: Variation caused by operators
Variation occurs when same part is measured by different operators
Part 1 2 3 4 5 6 7 8 9 10
1 21 24 20 27 19 23 22 19 24 25
Agent 1 2 20 23 21 27 18 21 21 17 23 23 Mean 1
Mean 20.5 23.5 20.5 27.0 18.5 22.0 21.5 18.0 23.5 24.0 21.9
1 20 24 19 28 19 24 22 18 25 26
Agent 2 2 20 24 21 26 18 21 24 20 23 25 Mean 2
Mean 20.0 24.0 20.0 27.0 18.5 22.5 23.0 19.0 24.0 25.5 22.35
370
Gage R & R: Example

Reproducibility: Variation caused by operators
Variation occurs when same part is measured by different operators

Overall Variation between operators : Difference between xbars = (22.35 - 21.9) = 0.45 Reproducibility AV) = ((xbar diff x K2)2 (EV2 / n r)) = ((0.45 x 0.7071)2 (1.196812 / 10 x 2))
= 0.1739
Operators n: Number of Parts r: Number of trails 2 3 K2 0.7071 0.5231
371
Gage R & R: Example

Total Gage R & R : Repeatability2 + Reproducibility2
= ( 1.196812 + 0.17392) = 1.2094
372
Gage R & R: Example

Part Variation:
Agent 1 Part 1 2 3 4 5 6 7 8 9 10 1 21 24 20 27 19 23 22 19 24 25 2 20 23 21 27 18 21 21 17 23 23 1 20 24 19 28 19 24 22 18 25 26 Agent 2 2 20 24 21 26 18 21 24 20 23 25 Mean 20.25 23.75 20.25 27.00 16.00 17.25 17.25 18.50 23.75 24.75
Rp: Mean max Mean min = 27.00 16.00 = 11

373
Gage R & R: Example

Part Variation:
Rp: Mean max Mean min = 27.00 16.00

= 11 Part Variation (PV): K3 x Rp = 0.3146 x 11 = 3.4606 Parts 2 K3 0.7071
3
4 5 6
0.5231
0.4467 0.4030 0.3742
7
8 9 10
0.3534
0.3375 0.3249 0.314
374
Gage R & R: Example

Total Variation: Total Variation: Gage R &R2 + Part Variation2 Total Variation: 1.20942 + 3.46062 = 3.6658
375
Gage R & R: Example

Summary Table: Source SD 5.15 x SD % Study Var
Repeatability
Reproducibility Total Gage R &R Part Variation Total Variation
1.19681
0.1739 1.2094 3.4606 3.6658
6.1636
0.8956 6.2284 17.8221 18.8791
32.64
04.74 32.99 94.40 100
% Study variation is 32.99% > 30% hence variation in processing time is not acceptable. Reasons shall be investigated and improvement plan shall put in place.
376
Summary of Case Study (Using Minitab)

10 Transactions, 2 Agents Each Agent processed each transaction twice Data Collection
Transaction 1 2 3 4 5 6 7 8 9 10 Agent 1 1 2 21 20 24 23 20 21 27 27 19 18 23 21 22 21 19 17 24 23 25 23 Agent 2 1 20 24 19 28 19 24 22 18 25 26 2 20 24 21 26 18 21 24 20 23 25
377
Enter the data in Minitab as shown

Select Stat>Quality Tools> Gage Study> Gage R&R (Crossed)
Click on columns as shown
Choose either ANOVA or Xbar&R. It is preferable to chose ANOVA as it also analyses the interaction effect
378
% Study variation is 35.28% > 30% hence variation in processing time is not acceptable. Reasons shall be investigated and improvement plan shall put in place.
379
Total Gage R&R. Focus only on Green Bars. These represents the % of total variation contributed from the data. The Gage R&R should be only 10% of total variation. Rest should be attributed to within transactions Variation. 35.28% is not acceptable Part-to-part variation (transaction to transaction) (estimate of process variation) Agent to Agent (Reproducibility)
Within Agent (Repeatability)

Represents the repeatability. Presence of of assignable causes (point out of control point) indicates stability problem. Excessive common cause variation to be addressed Represents the reproducibility. The detectable shift in the pattern on X-bar chart and inconsistent pattern are unwarranted.
Remember : Most of the points should fall outside control limits.
380
This graph shows the data for the 10 transactions for each Agent. It display the raw data and highlights the average of those measurements
Similar to top graph but the data is presented by Agent instead of Transaction. The graph will help identify Agent issues
This graph shows the data for each Agent for all the Transactions. Represents the Bias. Ideally, all the lines should overlap each other
381

2. Calculate Gauge R & R for a given example
382
Gage R&R for Discrete Data

Example: Gage R & R for evaluate appraiser process knowledge
An Engagement Team Lead (TL) considered 10 transaction and chosen 2 appraisers at random for Gage R&R study. The transactions were evaluated on Correct or Incorrect basis. For all the 10 transactions actual results (Standard) are also available with TL. 2 appraisers processed each transaction twice within gap of one week. The results are as follows. Study the Gage R&R.
TRANSACTION NUMBER 1 2 3 4 5 6 STANDARD TRIAL 1 CORRECT INCORRECT INCORRECT CORRECT INCORRECT CORRECT CORRECT CORRECT INCORRECT INCORRECT INCORRECT CORRECT RADHA TRIAL 2 CORRECT INCORRECT INCORRECT INCORRECT INCORRECT CORRECT TRIAL 1 CORRECT INCORRECT INCORRECT CORRECT INCORRECT CORRECT KRISHNA TRIAL 2 INCORRECT INCORRECT INCORRECT CORRECT CORRECT CORRECT
7
8 9 10
CORRECT
CORRECT INCORRECT CORRECT
CORRECT
INCORRECT INCORRECT CORRECT
CORRECT
CORRECT CORRECT CORRECT
CORRECT
CORRECT
383
Note: Minitab 13 is used. Commands are similar to Minitab 14
Enter the data in Minitab worksheet. Test1 and test 2 results of same appraiser should be at one place, as shown
384
Analyze Results
Select Stat > Quality Tools > Attribute Agreement Analysis
385
Analyze Results
Enter 2, 2, Radha, Krishna

386
Percent Repeatable by appraiser

(it should be >=80%)
387
Repeatability Vs Standard
388
Percentage Reproducibility For all appraisers (it should be >=80%)
Percentage Reproducibility For all appraisers Vs Standard (it should be >=80%)
389
Assessment Agreement
Pictorial Representation
Within Appraiser
Date of study: Reported by: Name of product: Misc:
Appraiser vs Standard
100 90 80 70 60 50 40 30
100
[ , ] 95.0% CI
90 80 70 60 50 40 30
Percent
Percent
RADHA
KRISHNA
Percent
RADHA
KRISHNA
Appraiser Appraiser Since R&R is less than 80%, root causes to be identified and corrective actions to be taken. Re-conduct study to assess the improvement.
390
Rules for Gauge R&R study conclusions

Case 1: Continuous Data If Total gage R &R %SV < 20 % , Measurement system is acceptable If Total gage R &R %SV between 20 % to 30 % Some problem with measurement system, use with caution If Total gage R &R %SV between > 30 % Measurement system is unacceptable. Case 2: Discrete Data If Gage R &R (Agreement) > 80 % Measurement system is acceptable
Else, Measurement system is unacceptable.
391

Gage R & R Attribute (Discrete) Data
2. Calculate Gauge R & R for a given example
392
Process Capability
393
Process Capability
Process Capability Refers to the inherent or natural variation of a process Common Process Capability Indices 1. Potential capability Cp 2. Achieved capability Cpk Process Capability Cpk A methodology to check whether the process have the capability to meet the customer requirements Customer requirements are also expressed as Lower Specification Limit (LSL) = 50 Days Upper Specification Limit (USL) = 60 Days
394
Potential capability Cp:

A measure of the ability/potential to meet the customer specifications Example 1: Specification: 55 5 Days Allowed variation = 50 Days to 60 Days Natural Variation = 52 Days to 58 Days Natural Variation < Allowed variation Hence Example 2 : Process have the capability to satisfy customer Specification: 55 5 Days Allowed variation = 50 Days to 60 Days Natural Variation = 48 Days to 62 Days Natural Variation > Allowed Variation Then Process doesnt have the capability to satisfy customer
395

If the data is normally distributed, then Natural variation : Mean 3 SD
Example:
Mean = 55 Days & SD = 1 Day
Natural Variation = 55 (3 x 1) to 55 + (3 x 1)
= 52 Days to 58 Days
396

Ratio of allowed variation to Total variation
Cp = Allowed variation / Natural variation

= (USL LSL) / ((Mean + 3 SD) (Mean - 3 SD)) = (USL LSL) / 6 SD
A Process has the capability to meet customer requirements if Allowed variation > Natural variation (USL LSL) > 6 SD Cp > 1
Preferably Cp should be greater than 1.34
397
Potential capability Cp: Example

The Time to Certify Agents in days is given in the table below. If the client requirement on Time to Certify Agents is 50 to 90 days, check whether the process has the capability to meet the client requirement ?
85 80 75 75 80 70 65 70 75 75 60 75 80 85 70 60 75 50 60 65
USL = 90 Days LSL = 50 Days
Cp = (USL LSL) / 6 SD = (90 50) / (6 x 9.2) = 40 / 55.2 = 0.72
Mean = 71.5
SD = 9.2
Conclusion ?
398
Potential capability Cp: Issues

Cp checks only whether the process has the potential to meet the requirements
Cp never checks whether the Process is actually meeting requirements
399

Example:
Process: Training Process Specification : 55 5 Days Process 1 Process 2 Process 3 Characteristic: Time to Certify Agents
Mean
SD USL LSL 6 SD Cp
55
1 10 6 1.66
52
1 10 6 1.66
58
1 10 6 1.66
400

Example: Process: Training Process Specification : 55 5 Days
Characteristic: Time to Certify Agents

Process 1 Process 2 1.66 50 to 60 49 to 55 Process 3 1.66 50 to 60 55 to 61
Cp Allowed variation Total process variation Cp = 1.66 for all 3 processes
1.66 50 to 60 52 to 58
all 3 process have the capability to meet customer requirement But only Process 1 is meeting customer requirement Hence
Achieved Capability Index is developed
401
Achieved Capability Index Cpk:

Cpk = Min [Cpl, Cpu] Cpl = (Mean LSL) / 3 SD Cpu = (USL - Mean) / 3 SD Cpk checks whether the process is centered.
402
Achieved Capability Index Cpk: Graphical Representation

LSL USL
Cpl = a / c = (Mean LSL ) / 3 SD

a
1.2 1 0.8 0.6 0.4 0.2 0 1 2 3 4 5 6 7
Cpu = b / d = (USL - Mean ) / 3 SD
3 SD c
Mean d
+ 3 SD 403
Achieved Capability Index Cpk: Example

6 12
Example:
USL : 12
Mean : 9
3
1.2 1 0.8 0.6 0.4 0.2 0 6 7 8 9 10 11 12
LSL: 6
SD : 1
Cpu = 3 / 3 = 1 Cpl = 3 / 3 = 1
Cpk = Min [1 , 1] = 1
Cpk = 1
- 3 SD 3
Mean 3
+ 3 SD 404

6 12
Example: USL : 12 Mean : 8 LSL: 6 SD : 1
2
1.2 1 0.8 0.6 0.4 0.2 0 5 6 7 8 9 10
Cpu = 4 / 3 = 1.33
Cpl = 2 / 3 = 0.66
Cpk = Min [1.33, 0.66] = 0.66 Cpk < 1, Process doesnt meet the customer requirements.
11
- 3 SD 3
Mean 3
+ 3 SD 405

6 12
Conclusion: Cpu = 3 / 3 = 1 Cpl = 3 / 3 = 1
3
1.2 1 0.8 0.6 0.4 0.2 0 6 7 8 9 10
Cpk = Min [1 , 1] = 1
Cp = (USL LSL) / 6 SD = 6 /6 = 1
When process Mean is at center of Specification then
Cpk =Cp
11 12
- 3 SD 3
Mean 3
+ 3 SD 406

Example: Process: Training Process Characteristic: Time to Certify Agents
Specification : 55 5 Days
Process 1 Mean SD USL LSL 6 SD 55 1 10 6
Process 2 52 1 10 6
Process 3 58 1 10 6
Cp
Cpk
1.66
1.66
1.66
0.67
1.66
0.67
407
Relationship of Cp and Cpk
Cp =2 Cp =2
Cpk = 2 Cpk = 1.5 Cpk = 1 Cpk = 0 Cpk = -0.5
LSL
USL
Cp =2
Cp =2 Cp =2
Mean
408

Process Capability
2. Calculate process capability for a given example
409
Process Sigma Level Calculations
410
Process Capability for Continuous Data

General Guidelines
1. Ensure that the data collected is free from measurement error 2. Ensure that the data is true representation of the population 3. Ensure that the process is stable 4. Ensure that the data is following Normal distribution. 5. If data is not normal, check for the transformed functions. 6. Still, data is non-normal, recheck the data or check whether the data fit in any non-normal distribution.
411
Process Capability for Continuous Data

Z Calculation for Normal Distribution Data
If data is normal follow the following sequence. Calculate Ppk using Minitab. Sigma multiple Long term of the process is = Zlt = (3 * Ppk) Sigma multiple Short term of the process is = Zst = (3 * Ppk)+1.5
Note the DPMO also from Minitab output.
412
Data Transformation
Typically one sided specification processes have skewed data. In such cases we transform the data points and specifications to convert data into a normal data. Transformed data for Y may be in the form of Y2, Y3, Y0.5, Ln(Y) etc. We can also use the Box-Cox transformation available in Minitab or apply instead of try out all the combinations. Transformation used for Y is also applied to LSL and USL
However, test of normality should be done again to check if the transformed data has now become normal
413
Process Capability for Continuous Data Example 1

The cycle time (in Minutes) of each transaction in a day on both the shifts was collected. The SLA for the cycle time of the process is 60min. Calculate the process capability.
Cycle Time 50 51 50 55 56 52 48 52 51 49 52 50 56 52 52 Shift 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 Cycle Time 60 55 49 53 46 51 50 41 51 58 54 57 50 49 41 Shift 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2
Enter the data in Minitab
414
Stability Test
Select Stat>Control Charts> Variable charts for Individuals> IMR chart
Click Cycle time
Click OK
415
Stability Test
I-MR Chart of Cycle Time_1
U C L=62.65 60
Individual V alue
55 50 45 40 1 4 7 10 13 16 O bser vation 19 22 25 28
_ X=51.37
All the points in the I-MR control chart are within control limits. No significant trends also.
So, it is a stable process.
LC L=40.09
15
U C L=13.86
M oving Range
10
__ M R=4.24
0 1 4 7 10 13 16 O bser vation 19 22 25 28
LC L=0
Note: If there are any out of control point, the related data to be analyzed and eliminate the assignable cause. Then, remove that data point and continue.
416
Select Stat>Basic Statistics> Normality Test Click cycle time in Variable field
Probability Plot of Cycle Time
Normal
99 Mean StDev N AD P-Value 51.37 4.206 30 0.696 0.062
Normality Test
95 90 80
Percent
70 60 50 40 30 20 10 5
P-Value is great than 0.05. So, it is a normal Distribution. Since the data is satisfying all the pre-requisites, we can calculate the process capability for this process.
417
40
45
50 Cycle Time_1
55
60
Capability Test
Select Stat>Quality Tools>Capability Analysis>Normal Click Cycle time Enter 1
Enter 60 in Upper Spec.
Click OK
418
Select Stat>Quality Tools>Capability Analysis

Process Capability of Cycle Time
USL
P rocess Data LS L * Target * USL 60 S ample M ean 51.3667 S ample N 30 S tDev (Within) 3.76009 S tDev (O v erall) 4.24218
Capability Test
Within Overall
P otential (Within) C apability Cp * C PL * C P U 0.77 C pk 0.77 O v erall C apability Pp PPL PPU P pk C pm * * 0.68 0.68 *
40
O bserv ed P erformance P P M < LS L * P P M > U S L 0.00 P P M Total 0.00
45
50
55
60
E xp. Within P erformance P P M < LS L * P P M > U S L 10836.64 P P M Total 10836.64
E xp. O v erall P erformance P P M < LS L * P P M > U S L 20919.46 P P M Total 20919.46
Ppk =0.68 Zlt = (3 * Ppk) = 2.04 Zst = (3 * Ppk)+1.5 = 3.45 DPMO = 20919.46 419
Process Capability for Continuous Data Example 2

HR is working on reduction of recruitment cycle time. 30 data points are collected to set the baseline capability, as shown below. The SLA is 60 days. Calculate the baseline capability of the process.
Recruitment Cycle time 50 51 50 55 56 52 48 55 51 50 52 50 56 52 52 Recruitment Cycle time 55 55 58 53 46 51 50 41 51 58 54 50 50 49 40
Enter the data in Minitab
420
Stability Test
Select Stat>Control Charts> Variable charts for Individuals> IMR chart
Click Recruitment Cycle time
Click OK
421
Stability Test
I-MR Chart of Recruitment Cycle time
60 U C L=61.45
Individual V alue
55 50 45 40 1 4 7 10 13 16 O bser vation 19 22
1
_ X=51.37
Some of the points are crossing control limits. No significant trends also.
So, it is a not a stable process. Since there are some out of control points, the related data to be analyzed and eliminate the assignable cause. Then, remove that data point and continue.
LC L=41.28
1
25
28
12
U C L=12.39
M oving Range
9 6 3 0 1 4 7 10 13 16 O bser vation 19 22 25 28
__ M R=3.79
LC L=0
Let us continue with the same data now.
422
Normality Test
Select Stat>Basic Statistics> Normality Test Click Rec. cycle time in Variable field
Probability Plot of Recruitment Cycle time
Normal
99 Mean StDev N AD P-Value 51.37 4.115 30 0.911 0.018
95 90 80
P-Value is less than 0.05. So, it is a non-normal Distribution. So look for the transformation.
Percent
70 60 50 40 30 20 10 5
40
45
50 55 Recruitment Cycle time
60
423
Select Stat>Control Charts>Box-Cox Transformation
Data Transformation
Ensure dot on top option
Click Recruitment Cycle time Enter 1 Enter C2 It store the transformed data in C2 column Click Ok
Click on Options
424
Data Transformation
Box-Cox Plot of Recruitment Cycle time
Lower CL
4.2
Lambda (using 95.0% confidence) Estimate 3.03 -1.26 * 3.03
4.0
Lower CL Upper CL Rounded Value
Lambda Value = 3.03
StDev
3.8
3.6 Limit 3.4
3.2 -5.0 -2.5 0.0 Lambda 2.5 5.0
425
Data Transformation
Select Stat>Basic Statistics> Normality Test Click Box-Cox in Variable field
Probability Plot of Box-Cox

Normal
99 Mean StDev N AD P-Value 155934 35099 30 0.673 0.071
95 90 80
Percent
70 60 50 40 30 20 10 5
P-Value is greater than 0.05. So, The transformed data is following normal Distribution. Now let us calculate the process capability
426
50000
100000
150000 Box-Cox
200000
250000
Select Stat>Quality Tools>Capability Analysis>Normal
Capability Test
Click on Box-Cox
Click Rec. cycle time
Enter 1
Enter 60 in Upper Spec. Click Box-Cox button
Enter Lambda value 3.03 Click others

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Select Stat>Quality Tools>Capability Analysis

Process Capability of Recruitment Cycle time
Using Box-Cox Transformation With Lambda = 3
Capability Test
U S L* P rocess Data LS L * Target * USL 60 S ample M ean 51.3667 S ample N 30 S tDev (Within) 3.36268 S tDev (O v erall) 4.15021 A fter Transformation LS L* Target* U S L* S ample M ean* S tDev (Within)* S tDev (O v erall)* * * 244230 155371 29657.1 35265.1
transformed data
Within O v erall P otential (Within) C apability Cp * C PL * C P U 1.00 C pk 1.00 O v erall C apability Pp * PPL * P P U 0.84 P pk 0.84 C pm *
75000 O bserv ed P erformance P P M < LS L * P P M > U S L 0.00 P P M Total 0.00
100000 125000 150000 175000 200000 225000 E xp. O v erall P erformance P P M < LS L* * P P M > U S L* 5872.39 P P M Total 5872.39
E xp. Within P erformance P P M < LS L* * P P M > U S L* 1366.91 P P M Total 1366.91
Ppk =0.84 Zlt = (3 * Ppk) = 2.52 Zst = (3 * Ppk)+1.5 = 4.02 DPMO = 5872
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Process Capability for Attribute Data

We can use Capability Analysis (Binomial) if the data meet the following conditions. Each item is the result of identical conditions. Each item can result in one of two possible outcomes (success/failure, Go/No go) The probability of success (or failure) is constant for each item. The outcomes of the items are independent of each other.
429
Process Capability for Attribute Data - Example

A Black belt is working on project to reduce the defective transaction in a process. He has collected data for 30 days as shown below. Calculate the baseline Capability of the process.
Sl No 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Trasactions / day Defective Transations 52 9 55 11 51 16 47 11 50 9 49 11 54 9 48 13 53 11 50 7 45 10 50 6 52 11 47 7 45 10 Sl No 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 Trasactions / day Defective Transations 45 14 53 13 55 12 49 10 51 7 46 8 55 9 50 8 53 11 55 10 45 12 49 12 53 12 48 9 50 17
Enter the this data in Minitab

430
Capability Test
Select Stat>Quality Tools >Capability Analysis>Binomial
Click on Defective Transactions
Click on No. of Transactions
Target, by default 0. Value can be entered if there is any target.
Click OK
431
Capability Test
P r opor tion
Binomial Process Capability Analysis o

P C har t 0.4 U C L=0.3819 _ P =0.2093
The P-Chart Verifies that the process is in a state of control.
0.2
In this case there is no out of control point.

The proportion defective is 20.93%.
0.0 1 4 7 10 13 16 19 Sample 22 25 28
LC L=0.0367
Tests performed w ith unequal sample sizes C umulative % Defective
S ummary S tat
% Defective
Cumulative % defective is the running average of the percentage defective.

It verifies that you have collected data from enough samples to have a stable defective estimate. The rate appears to be stabilizing around 21%
22.8 21.6 20.4 19.2 18.0 5 10 15 20 Sample 25 30
(using 95.0% confide % Defectiv e: Low er C I: U pper C I: Target: P P M Def: Low er C I: U pper C I: P rocess Z: Low er C I: U pper C I:
2 1 2
20 18
23 0. 0. 0.
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Defective Transations
Rate of Defectives
Capability Test
Defective rate plot verifies that the % defective is not influenced by the number of items sampled.
% Defective
30 20 10 45 50 Sample Size 55
Data should appear randomly distributed.
Dist of % Defective Tar 6.0 4.5 3.0 1.5 0.0
3 0 7 0 2 0
5 8 4 6
10 15 20
25 30 35
Histogram of % defective displays the over all distribution of the % defectives from the samples collected
433
0.0 1 4 7 10 13 16 19 22 25 28 Sample
LC L=0.0367
10
Tests performed w ith unequal sample sizes Binomial Process Capability Analysis of Defective Transations
P C har t 0.4 U C L=0.3819 _ P =0.2093
C umulative % Defective
% Defective
30 20 10 45 50 Sample Size 55
Rate of Defectives
Summary Stats (using 95.0% confidence) %Defective: Lower CI: Upper CI: Target: PPM Def: Lower CI: Upper CI: Process Z: Lower CI: Upper CI: 20.93 18.90 23.07 0.00 209302 189000 230745 0.8088 0.7364 0.8816
P r opor tion
0.2
22.8
T 6.0 4.5 3.0 1.5 0.0
7 10 13 16 19 22 25 28 Sample
% Defective
0.0
LC L=0.0367
21.6 20.4 19.2
Tests performed w ith unequal sample sizes C umulative % Defective
Summary Stats %Defective: Lower CI: Upper CI: Target: PPM Def: Lower CI: Upper CI: Process Z: Lower CI: Upper CI:
Dist of % Defective Tar 6.0 4.5
(using 95.0% confidence)

22.8
% Defective
21.6 20.4 19.2 18.0 5 10 15 20 Sample 25 30
20.93 18.0 18.90 23.07 0.00 209302 189000 230745 0.8088 0.7364 0.8816
5 3.0
1.5 0.0
10
15 20 Sample
25
30
10 15 20
25 30 35
Capability Test
Results: P-chart indicates that process is stable as there are no data points out of control The chart of cumulative % defective show that the estimate of the overall defective rate appears to be settling down around 21%. The process Z is around 0.8, which is very poor. This process could use a lot of improvement
434
Process Sigma Multiple for Discrete Data

Terminology Unit:
A unit is the tangible & measurable characteristic of a process input / output. Defects are observed / counted in the output characteristic of a unit (Denoted as Y)
Examples:
Every Call received by a call center Agent: Each employee recruitment cycle time Each transaction processed by agent The transaction not meeting the customer requirement Non-availability of system Unit= Call Unit = Employee Unit = Transaction Unit: Transaction Unit = System
Defect:
A defect is a failure to conform to requirements Any type of undesired result is a defect. A failure to meet one of the acceptance criteria of a customer. A defective unit may have one or more defects.
435
Specification Vs Characteristic
Specification is a customer-defined tolerance for the output unit value. There may be two sided specifications. Specification form the basis of any defect measurement exercise on continuous data A characteristic is a customer-defined expectation on the output unit. Characteristic from the basis of any defect measurement exercise on discrete data There may be multiple characteristics defined on a single unit. It is also possible to have a combination of specifications and characteristic on an single unit
Specification : Continuous Data
Characteristic : Discrete Data
Example: Transaction processing

Unit: Each transaction processed
Some of the defect definitions may be 1) Transaction not completed before 24min = Specification 2) Transactions not submitted in to client server after processing = Characteristic 3) Transactions submitted with out filling up the amount = Characteristic
436
Opportunity for Defect:

Any critical characteristic which is routinely inspected before passing the item is an opportunity for defect. (or) Opportunity for the error in a process is the number of steps / task / actions in the process, where there is a possibility of committing error, that may result in a defect. Concept of OFD is applicable only when defect measurement is discrete.
Recollect the operational definition >>>>>> Clarity is more important when developing and selecting the measures that will be used to determine the SIGMA PERFORMANCE of the process.
e.g. Operational definitions may determine if a team is to count all the defects on an invoice (required to calculate defects per million opportunities) or the total number of defective invoices (any invoice with any defect) or the type of defects encountered on an invoice (to eliminate the most common defects first). Each of these cases may require a very different approach for gathering the data
437
Examples:
For example, if client wants to ensure that each transactions to be completed with in 20 min, it can be considered as specification and follow the continuous data path.
If client is interested in controlling defective transactions, the entire unit is either good or Bad. A proportion can be calculated (Binominal).
If operation head or client head is interested in minimizing the abandoned calls and team is interested in identifying the steps / task / actions in the process, First team suppose to map the process and identify the steps which results in abandoned calls and those steps can be considered as Opportunity for Defect.
In some cases, client may scope the improvement area. In that situation, team can consider only that portion and identify the Opportunities for Defects.
438
Examples:
If the measurement and improvement of process characteristics calls for noting all the defects, each detail of the process to be considered OFD.
If there is no limit to the number of defects that can be counted, It is not possible to count the non-defects, poison distribution can be used.
If operation head or client head is interested in minimizing the abandoned calls and team is interested in identifying the steps / task / actions in the process, First team suppose to map the process and identify the steps which results in abandoned calls and those steps can be considered as Opportunity for Defect.
439
Exercise for DPMO calculation for Discrete data

The Inspection result for a set of 100 Purchase Orders (PO) are given in the Table below:
Cause of Rejection Supplier Name Incorrect Supplier Door # Incorrect Quantity Higher than that in Indent Number of Defects 1 1 3
Quantity less than that in Indent

Price is higher than that in the Indent Price is lower than that in the Indent Number of Defects = Number of Opportunities for Defects =
1
2 2
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DPU: Defects Per Unit

The ratio of Number of Defects found to the total Number of Items Inspected Cause of Rejection Supplier Name Incorrect Supplier Door # Incorrect Quantity Higher than that in Indent Number of Defects 1 1 3

Price is higher than that in the Indent Price is lower than that in the Indent Number of Defects = 10
1
2 2
DPU = Number of Defects / Total Number Units Inspected = 10 / 100 = 0.1
441
DPO: Defects Per Opportunity

Ratio of total number of Defects to the total number of opportunities in the inspected lot. Cause of Rejection Supplier Name Incorrect Supplier Door # Incorrect Quantity Higher than that in Indent Number of Defects 1 1 3

Price is higher than that in the Indent Price is lower than that in the Indent
1
2 2
DPO = Defects / (Opportunities x Total number of Units Inspected) DPO = 10 / (100 x 4) = 0.025
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DPMO: Defects Per Million Opportunity

DPMO = DPO x 1000000
Cause of Rejection Supplier Name Incorrect Supplier Door # Incorrect Quantity Higher than that in Indent Quantity less than that in Indent Number of Defects 1 1 3 1
Price is higher than that in the Indent

Price is lower than that in the Indent
2
2
DPO = Defects / (Opportunities x Total number Inspected) DPO = 10 / (100 x 4) = 0.025 DPMO = DPO x 1000000 = 0.025 x 1000000 = 25000
443
Yield:
Yield = e-DPU Cause of Rejection Supplier Name Incorrect Supplier Door # Incorrect Quantity Higher than that in Indent Quantity less than that in Indent Price is higher than that in the Indent Price is lower than that in the Indent Number of Defects 1 1 3 1 2 2
DPU = Defects / (Total Number Inspected) = 10 / 100 = 0.01 Yield = e-DPU= e-0.01=0.99005 = 99 %
444
ZST: Short Term Sigma Value

Z is the Standard Normal Variate equivalent to DPO obtained from Z table.
Cause of Rejection Supplier Name Incorrect

Supplier Door # Incorrect Quantity Higher than that in Indent Quantity less than that in Indent Price is higher than that in the Indent Price is lower than that in the Indent
Number of Defects 1
1 3 1 2 2
DPO = Defects / (Opportunities x Total number Inspected)

DPO = 10 / (100 x 4) = 0.025 ZST = 1.96 From conversion tables
445
ZLT: Long Term Sigma Value ZLT = ZST - 1.5 Cause of Rejection Number of Defects
Supplier Name Incorrect

Supplier Door # Incorrect Quantity Higher than that in Indent Quantity less than that in Indent Price is higher than that in the Indent Price is lower than that in the Indent
1
1 3 1 2 2
DPO = 0.025
ZST = 1.96 From conversion tables ZLT = ZST - 1.5 = 1.96 - 1.5 = 0.46
446

Sigma level calculations
447
Some Helpful Hints:

It is always preferable to deal with continuous data. Continuous data is measured on a continuum or scale. Collect the cause data along with performance data for initial quick wins. Once you determine the entire processes, collect the additional data related to those causes. Always evaluate the colleted data, before calculating the base line capability
448
Some Helpful Hints:

Proportion Defective: The entire unit is either good or bad. A proportion can be calculated. Assume Binomial Count of defects: There is no limit to the number of defects that can be counted. Assume poison. Calculate Zlt value using Ppk (noted in Minitab output) instead of Cpk, as Ppk is represents the long term process capability Not all the percentages are discrete or count data. Eg. % system availability. If both the numerator and denominator are determined by measuring the % is considered continuous data.
449
Exercise D & M Phase deliverables

Deliverables 1 2 3 4 5 6 7 8 Type of data Descriptive Statistics (Mean, Median, Mode, SD, Histogram) Sample Size & confidence interval (Accuracy required 10 Secs) Probability of getting transaction time between 55 to 65 seconds. Probability of getting transaction time > 70 seconds Normality Test Process Capability ( LSL : 58 Secs, USL : 65 Seconds) Sigma level calculation
Table 1: Raw data on Transaction time of express Teller

Woking day Appraiser A 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 63 69 57 58 79 55 57 58 65 73 57 66 63 68 70 65 63 61 65 70 55 63 60 64 68 66 61 51 66 66 63 63 53 67 62 59 69 56 57 60 Transaction Times(sec) Appraiser B 56 60 61 60 65 62 58 61 62 61 56 65 69 59 66 60 58 62 69 67 53 65 65 61 61 63 64 57 68 70 64 59 60 58 80 61 56 59 62 79 Appraiser C 61 61 66 57 74 56 55 66 61 72 62 70 61 65 71 62 66 57 58 75 64 66 62 65 71 52 63 59 67 78 59 61 58 59 76 65 61 55 72 68
Gauge R & R
450
Week 1 Define & Measure Phase

Sigma level calculations
451
Thank You
452

Six Sigma Black Belt Wk1 Define Amp Measure

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Six Sigma Black Belt Program

Define & Measure phase

Objectives of Black Belt training

Why 6 Sigma in our organization?

Fundamental Principles Quality Concepts

Aim So High Youll Never Be Bored

Moving up the competency ladder

1. Unconsciously Incompetent 2. Consciously Incompetent 3. Consciously Competent 4. Unconsciously Competent

BETTER QUALITY = LOW COST

Qualitys contribution to Profitability

Wastes of Service Industry

Redundant Process steps

Wastes Kill .. Business and Profits

Cost of Poor Quality

Traditional Quality Costs

Rejects Rework (tangible) (tangible) Scrap

Additional Costs of Poor Quality

Long cycle time Late delivery

Lost Customer Loyalty Excess inventory Expediting costs

Cost of Poor Quality (COPQ)?

Cost of Quality Categories

Internal Failure Costs

External Failure Costs

Maintaining test equipment

1980s: Six Sigma

1960s: Japanese Quality Movements

1940s: Statistical Process Control

1920s: Invention of Control Charts by Walter A. Shewhart, Bell Labs

Demings 14 points for Quality Management (Principles of transformation)

Demings 14 points for Quality Management

Demings 14 points for Quality Management

13. Institute a vigorous program of education and retraining.

Introduction to Six Sigma

Six Sigma History

And the Results?

Six Sigma History

Asea Brown Boveri

ABB, after application of Six Sigma has reduced

Allied Signal, which was on the verge of

A Six Sigma Journey 1987 to 2006

Companies Implemented 6 Sigma Worldwide

Asea Brown Boveri

Definition & Drivers

Definition of Quality as per Six Sigma

6 Sigma : What Makes It Different?

Six Sigma v/s TQM and ISO

It is a Greek term which

Time taken to procees order - Advisor B 45 44 43 42 41 40 39 38 37 36 35 1 2 3 4 5 6 Order no

Time taken to process order - Advisor A & B

Which Advisor will you prefer ?

0 0 10 20 30 40 50 Process before and after Six Sigma

A Six Sigma Landing .

Sigma Level and Quality

Six Sigma Process

USL 1 Std. Dev. / 1 Sigma

6 Std. Dev. / 6 Sigma

.. then 99.99966% of our opportunities are included!

Which one should we focus on the Y or X?

Lets Avoid This Situation !

Focus on the cause (x) to change the response

Focus on source of variation to eliminate the problem

Measure the variation. We cant improve what is not measured.