Course Outline

1. Lean Six Sigma Yellow Belt Course WEP 223Francis SmithCarsten SvenssonOmar MoheyeldinShakeelParkar

2. Course Outline Course runs from 09:30 to 17:00 for 2 days Agenda • Introductions • Introduction to industrial history • Yellow Belt training

3. What is Lean Six Sigma ? Lean Six Sigma is an integrated approach to Continuous Improvement. It seeks to improve quality, speed, efficiency and effectiveness by removing overburden, waste and variation from an organisation’s core processes. It can strongly impact the culture of the organisation by focusing on leadership, behaviours, competence and capability development and is most effective when used as a strategic initiative. Levels of training • Yellow - entry level introduction • Green - standard training • Black Belt - advanced training • Master Black Belt – Jedi The use of belts to describe level was a Motorola marketing gimmick

4. Why start with Industrial history? The tools and techniques that underpin Lean Six Sigma originated in the systematic changes of the second industrial revolution Lean Six Sigma is a concept that originated in manufacturing and spread to business processes in transactional and service. It can now be found in finance, banking, healthcare, communications and media to name a few

5. What happened ?

6. Revolution Enablers Improved Farming Methods • Fertilization • Iron plough • Drainage • Crop rotation • Seed Drill Effects • Dramatic improvement of output • Reduction of food shortage • Better health • Driving small farmers off the farm and into the cities Seed drill1701 Rotherham plough 1730

7. Harnessing Power - At a cost

8. From Hand to Machine To remain competitive, large investments were required. As a result cottage industries died and thousands had to find new ways of supporting themselves.

9. England’s Resources - Capital The international trade made many English merchants very wealthy These merchants had the capital to invest in the factory system to buy buildings, machinery, and raw materials

10. Why the Industrial Revolution Started in England

11. The Birth and Growth of the Textile Industry 1

12. The Birth and Growth of the Textile Industry 2

13. Key Innovations Spread of knowledge Mass production Replaceable parts Human power to machine power

14. Effects of Industrialization Move from cottage industries to factories Increasing urbanization Improved transport infrastructure

15. Maturing of Industrialization The Watt Steam Engine (1775) Based on known technology Extremely powerful (c. 30hp) Reliable

16. Effects of improved transportation

17. Second Industrial Revolution Transportation improved • Ships • Wooden ships → Iron ships → Steel ships • Wind-powered sails → Steam-powered boilers → diesel • Trains • Roads & Automobiles Communication improved • Newspapers • Telegraph • Radio

18. Scientific ManagementChild of the second Industrial Revolution Apply scientific methods for studying work execution Define processes Document knowledge Record data Analyze observations Optimize for efficiency

19. Scientific Management Time and Motion study Break jobs down into tasks Eliminate unnecessary movement Set productivity goals Use experimental designs Establish one best way

20. Ford Motor Company Unrelated but parallel to Taylor The assembly line revolutionizes car manufacturing First car for the masses Standardisation – “Any colour, as long as it’s black”

21. 2 World Wars Recruitment simplified by urbanization Warfare revolutionized by the mass production of ammunition and weapons A race to produce ships, planes, weapons and ammunition Industry becoming a primary target Woman in large numbers enter the workforce A liberty ship could be built in 42 days

22. Rebuilding US commercialized wartime innovation US supported the reconstruction of in Germany and Japan with administration, engineers and doctors War industry was transformed to peace time capability

23. Deming in Japan • Deming was a statistician • His methods gained little traction in US • Worked with Japanese Union of Scientists and Engineers JUSE • Introduction of statistical process control SPC • Cost of poor quality COPQ

24. Post WWII US Manufacturing Post WWII boom resulted in demand of US manufactured goods – if you could make it, you could sell it Unions grew stronger to protect workforce rights Introvert perspective on improvement No burning platform for change

25. Oil Crises American cars missed the market Little had been invested in development Machinery was becoming outdated Quality was poor

26. Japanese and German Inspiration Understanding customers’ wants and needs Focus on productivity and output Ark and Pilat (1993): Productivity Levels in Germany, Japan, and the United States: DiJferences and Causes

27. Lean Six Sigma Evolution

28. Lean Six Sigma and the Knowledge Economy IT has revolutionised business processes We are still waiting for a revolution in administrative processes A number of process improvement methods such as Lean, TQM, BPR, OD, Six Sigma became popular in the 90’s integrating People, Processes and Technology Significant growth of Lean Sigma initiatives in finance, banking, healthcare, local government, telecommunications and media in the “noughties” Buy-in depends on the need to flex and adapt to rapidly changing markets

29. KAUST Lean Six SigmaWEP 2014 Yellow Belt Course

30. Time for a Video, and some reflection

31. How does this happen ?

32. Agenda Day 1: Define and Measure Day 2: Analyse, Improve and Control

33. The 7 Quality ToolsUseful tools for Yellow Belts 1. Flow Charts (Process Maps) 2. Check Sheets 3. Pareto Charts 4. Control Charts (Run Charts) 5. Fishbone Diagrams 6. Histograms 7. Scatter Diagrams

34. What is Lean and What is Six Sigma? Lean A people centric discipline focused on : • creating value in the eyes of the customer • identifying the value stream • products and services are pulled by the customer and flow through the organisation • perfection is pursued relentlessly by the removal of waste from the process • Cultural and behavioural change at all levels of the organisation Six Sigma A data driven quality improvement methodology focused on : • Applying statistical tools and a structured project management methodology to process problems • Identifying drivers of variation in the process • Reducing variation so the process can be run to target as defined by the customer

35. The Five Key Principles of Lean Thinking Create Pull Value Process only what the customer needs when they need it Focus on value as defined by the customer Pursue Perfection Continuously look for ways of improving and perfecting the process Create Flow Value Stream The sequence of activities along which information or materials flow to provide value to the customer Flow happens when information or materials flow freely through the value stream without interruptions

36. How do we make improvement ? Muri (Overburden) Muda (Waste) Mura (Unevenness)

37. Six Sigma focuses on theConcept of Variation Variation exists in everything • In some cases, variation is so small that it is difficult to detect; but it is there • If it is assumed that everything is a result of some process, then it is rational to conclude that the process explains product or service variation • Variation in the product or service is due to variation in the process itself

38. Lean Six Sigma The best of Lean & Six Sigma Focus on customer value, waste elimination, speed, flow Focus on customer value, defect reduction, variability, and rigorous project driven problem solving Lean Process Thinking Six Sigma Defect Reduction Lean Six Sigma Improvement Business Improvement methodology with lean & data analysis tools built in

39. The Magnificent Seven – the Key Principles of Lean Six Sigma Focus on the customer Identify and understand how the work gets done – the value stream Manage, improve, and smooth the process flow Remove Non-Value-Add (NVA) steps and waste Manage by fact and reduce variation Involve and equip the people in the process Undertake improvement activity in a systematic way

40. In short… Lean Six Sigma is a rigorous and a structured project-based methodology that utilizes data to : measure and improve a company's operational performance, practices and systems from the customer’s perspective verify root causes and prevent 'defects' in processes meet customer and stakeholder expectations, wants and needs

41. Quality – Targets and Variation Specifications are met. The pilot landed on the runway each time.

42. Quality: Uniformity Around a Target Value The pilot lands closer to the center of the runway (the target value).

43. A 1 A A A A 6 5 7 8 A A A 3 10 9 B B B B B B B B 1 8 2 6 B 3 4 9 A 7 5 A 2 4 B 10 Understanding Variation Center of the Runway (TARGET) Pilot B Pilot A Left Edge of the Runway (LSL) Right Edge of the Runway (USL)

44. What is a Sigma score? We use the Defects Per Million Opportunities (DPMO) method to get a high level measure of process performance

45. Calculating Process Sigma • Number of units processed N = __________ • Total number of defects made (include defects made and later fixed) D = __________ • Number of defect opportunities per unit (equate to CTQs) O = __________ • Calculate # defects per million opportunities DPMO = 1,000,000 x ( = 1,000,000 x = __________ • Look up process sigma in sigma conversion table Sigma= __________ D N x O ) ( ) ( ) ( )

46. Sigma Conversion Table

47. Calculating Process Sigma • Number of units processed N = 500 • Total number of defects made (include defects made and later fixed) D = 57 • Number of defect opportunities per unit (equate to CTQs) O = 3 • Calculate # defects per million opportunities DPMO = 1,000,000 x = 1,000,000 x = 38000 • Look up process sigma in sigma conversion table Sigma = 3.3 D N x O 57 (500 ) x (3 )

48. Let’s try it... Let’s try it with some Smarties and have a bit of fun as well...... Let’s discuss this product and come up with 2 CTQs • CTQs must be measurable • Count the defects (events when the CTQ is not met) • Calculate the DPMO and then the Sigma score

49. Measuring the Sigma Value of Your Processes • We need to calculate the sigma performance of our processes • We need to know the baseline performance • This will help us understand how much improvement is needed • And, in time, how much improvement we’ve achieved

50. Ignore the Soft Stuff at Your Peril • Underpinning any successful initiative, you’ll find some softer, yet essential elements of change • George Eckes’ formula to express this relationship is E = Q x A • E is Effectiveness • This represents the effectiveness of the implementation which depends on the quality of the solution and the level of acceptance • Q is the quality of the solution • An ideal solution may have been identified, but its effectiveness will depend on how well it is accepted • A is the level of acceptance of the solution • The level of acceptance is key, as it has a multiple effect on the overall success of the implementation • All too many organisations focus only on the Q forgetting the importance of the A • So, what are these elements?