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  1. Design for Success DFSS: Design For Six Sigma Mark M. Skinner

  2. Q.What do sports eyewear and retirement plans have in common? A. Process Design for Success

  3. Six Sigma:Quality Design for Success

  4. Q.What is quality? Design for Success

  5. What is Six Sigma... • Six Sigma is a business concept that answers customers’ demand for high quality and defect-free business processes. • Six Sigma was born when Motorola published its Six Sigma quality program in 1987. • Six Sigma is a unified approach to process excellence. • Six Sigma has transformed some of the most successful companies in the world (Motorola, Allied Signal, GE). • Six Sigma is a target (Fewer than 3.4 defects or errors per million opportunities – 99.99966 perfection). • Six Sigma is an approach to aiming at that target by changing the culture of a company. It involves everyone in the company. Design for Success

  6. What is Six Sigma... • Six Sigma can be used to design in excellence and then make continuous improvements. • Six Sigma is used to bring new products and services to market (Define, Measure, Analyze, Design, Validate) by methodically laying everything out first. • Six Sigma identifies problems in a process, sets up projects within the process, evaluates the process and works through the projects (Define, Measure, Analyze, Improve, Control) to improve the process. • Six Sigma aims to raise customer satisfaction by reducing the number of defects in a process, thereby raising the Sigma rating. • Six Sigma is a culture which permeates a company in the desire of all staff to achieve targets, increase customer satisfaction, lower costs and improve profitability. Design for Success

  7. Greek Letter • Measure of variation • aka: standard deviation • Process Quality Measurement Design for Success

  8. Perfection 99.7% 54,000 2 5 1,350 10,000 54,000 4.3 99.9% 4,000 1 2 500 3,000 4,000 4.6 99.99966% 1 every 25 years 1 second every16 years 1 in 10 years atall U.S. airports 1 in 20 years 10 1 6 • Incorrect drug prescriptions each year • Unsafe drinking water; hours per month • Missed landings each day at London’s Heathrow airport • Incorrect surgical operations per week • Newborn babies dropped by doctors and nurses each year • Lost mail per hour Sigma Level Design for Success

  9. Q.Can you give an example of something that didn’t represent quality? Design for Success

  10. Q.Can you describe something of high quality? Design for Success

  11. Six Sigma Precepts • Customer and process focused • Focus is on the things that matter • Data driven decisions • Act on fact • Reduced variation in process performance • Variation is the enemy • Reduction in cycle time • Faster is usually better • Prevention of defects • Proactive not reactive • A new perspective of performance • 99% is not good enough Design for Success

  12. Core Principles of Six Sigma • Customer satisfaction • Profit improvement • Project-by-Project improvements • Prioritization of improvements • Process-driven approach to managing the business • DMADV / DMAIC • Near Perfection as a goal of performance • Teamwork draws on experience, knowledge and dedication • Recognition - expression of respect for employee contribution Design for Success

  13. The Six Sigma Difference • Assigns and trains improvement experts • Involves all/most organizational members • Targets significant and lasting improvements • Requires the use of proven statistical tools • Attacks the root cause of problems • Focuses on improvements that have financial impact • Provides a single measure to compare disparate processes • Pushes processes to achieve near-perfect quality levels • Six Sigma is a permanent long-term program Design for Success

  14. Q.What 3 skills are critical? • Communication • Teamwork • Mathematics Design for Success

  15. Q.What is Communication? Design for Success

  16. Q.What is Teamwork? Design for Success

  17. Q.What is Mathematics? Design for Success

  18. Customer Perceptions... A View of Process Improvement Opportunity Processes that Influence Perception of Value Processes that Influence Strength of Relationship Processes that Influence Perception of Service • Attention to Customer Feedback • Customer Needs Analysis • Creation of Innovation Solutions • Product Development • Pricing • Risk Management • Sales Management • Account Management • Brand Management • Hiring and Staffing • Employee Development • Attention to Employee Feedback • Access and Availability • First Experience • Customer Wait Time • Inquiry Investigation • Transaction Execution Design for Success

  19. Business Definition Quality:No coffee stains on tables Design for Success

  20. Business Definition Quality:The delivery of a hot steak, cooked medium rare Design for Success

  21. Lunch is a Process Design for Success

  22. 1. IDENTIFY OPPORTUNITIES 2. FORM TEAM & SCOPE PROJECT 3. ANALYZE CURRENT PROCESS 4. DEFINE DESIRED OUTCOMES Process Flow Analysis FOR IMPROVED PROCESS Process Flow Analysis Identify Customers Establish Process and Requirements Define Performance Boundaries Measures Benchmarking Agree on Goals Analyze Available Check Sheet SURVEY Pareto Analysis Data GOAL YES NO A HISTORY CHECK SHEET Tree Diagram REPORT B C D 9. ACKNOWLEDGE TEAM AND 5. IDENTIFY ROOT CAUSES & PROPOSED SOLUTIONS COMMUNICATE RESULTS Brainstorming Process Redesign TEAM RESULTS REPORT Why-Why Diagram Nominal Group Technique Cause & Effect Diagram EFFECT 6. PRIORITIZE, PLAN AND TEST PROPOSED SOLUTIONS RECYCLE IF NECESSARY Design of Level Loading Experiments PRODUCTION DAYS 1 2 3 30 8. MEASURE PROGRESS & HOLD 7. REFINE AND IMPLEMENT C+ 90.00 A 83.67 B GAINS SOLUTIONS 77.33 C- C 71.00 Brainstorming Force Field Analysis PhaseStep(s) Define 1 & 2 Measure 3 & 4 Analyze 5 Improve 6 & 7 Control 8 & 9 C- D 64.67 58.33 Trend Chart SPC C+ 52.00 Pull System A- A+ NEXT OPERATION PRIOR Training & Procedures GANTT Chart OPERATION Six Sigma DMAIC Model Design for Success

  23. Using Successive Projects for Cycle Time andDefect Reduction Hi As Is (Current State) Should Be (new As Is) Cycle Time and Defects Should Be (new As Is) Should Be (new As Is) Could Be (Best-in-Class) Low Time Design for Success

  24. DMAIC • Define • What is important? • Measure • How are we doing? • Analyze • What is wrong? • Improve • Fix what’s wrong • Control • Ensure gains are maintained to guarantee performance Design for Success

  25. Define • Identify our internal and external customers • Determine what our customers want • Identify our suppliers • Determine what we need from our suppliers • Identify problems • Identify the process that contributes to the problems • Identify improvement opportunities • Scope the improvement project • Select the right players • Set goals and objectives Design for Success

  26. Measure • Review the current process • Identify key inputs and outputs • Develop baseline and entitlement metrics • Performance • Cost • Collect and organize data • Evaluate the performance of the process • Defects • Cycle time • Assess the amount of variation • In the process • In the measurement system Design for Success

  27. Analyze • Identify issues that occur at each step in the process • Assess customer impact of problems • Prioritize most critical inputs • Assess the effect on outputs or performance • Determine root causes • Generate solutions • Select most likely solutions Design for Success

  28. Improve • Develop Action Items • Prioritize improvements • Test solutions • Determine best combination of inputs and controls • Refine solutions • Document solutions • Implement solutions Design for Success

  29. Control • Measure progress • Capture and quantify benefits of the process improvements • Document the project • Communicate for organizational learning • Recognize the team’s efforts and success • Monitor and manage to hold gains • Adjust for continuous improvement Design for Success

  30. Tools & Templates by DMAIC Phase Note: The relationship between the specific tool and the DMAIC phase is based on most likely usage as opposed to possible usage. Design for Success

  31. Tools & Templates by DMAIC Phase continued Note: The relationship between the specific tool and the DMAIC phase is based on most likely usage as opposed to possible usage. Design for Success

  32. Define - Team Charter • What is the focus of the team’s efforts? • What are the boundaries of the effort? • What is the expected outcome? • Why is this important? • Who are the key players? Design for Success

  33. Define - Thought Process Map • What is the problem? • Do we have any data and information on the problem? • What processes are being considered? • What are the key questions that need to be answered? Design for Success

  34. Plan Participant requests,completes and Field Office/Outside Carrier mails a Distribution Request receives the request - Office Manager Reviews - Carrier Reviews - Mails request to National Office Mail Room (N.O.) Benefits Area sorts by plan receives application - Opens Mail - Opens Mail - Sorts Mail - Sorts by Plan - Distributes to Processors - Delivers to Benefits Department Benefits Processor reviews Benefits Processor and processes applications processes the check - Review for good order - Reviews check to Distribution - If not in good order, recycles Form - If in good order, processes - If in good order, mails - If not in good order, voids check and reprocesses Mailroom sends check to the Plan Participant receives Plan Participant the check - Places check in envelope - Sends out the check Define - Top Level Process Map Benefit Distributions - Top Level Map • What is the starting point of the process? • What is the end point of the process? • What are the major steps in the process? • Who is involved in the process? Design for Success

  35. Measure - DPMO and Sigma • What is the output volume of the process? • What are the opportunities for error? • How many defects are produced? • What is the performance level of the process? (Defects per million opportunities) Design for Success

  36. Measure - Descriptive Statistics • Is our data normally distributed? • What are the confidence intervals? • Can we use our data for further analysis? Design for Success

  37. Measure - Control Charts • What are the performance trends? • Is variation within the normal range? • Is the process stable? • Is the process capable? Percent of Transactions Rejected Design for Success

  38. Measure - Detailed Process Map • Who are the suppliers and customers? • What are the inputs and outputs? • Which inputs are controllable? • Where do we have issues? • What impacts cycle time? • Is there a hidden factory? • What % of the steps add value? Design for Success

  39. Measure - Issues List • What goes wrong at each step in the process? • Where are the majority of the problems? • What functional areas are most affected? Design for Success

  40. Analyze - Cause and Effect Matrix • What are the most important customer requirements? • What is the relationship of major process steps and inputs to customer requirements? • Where should we focus our improvement efforts? Design for Success

  41. Analyze - Ishikawa (Fishbone) • Which of the process inputs are likely to contribute to the problem? • What are the categories of root causes? • What are the most likely root causes within each category? Design for Success

  42. Pareto by Reason Code Analyze - Pareto • What is the frequency of occurrence of each potential root cause? • Which root causes are likely to contribute most to our defects? • Which root causes should we focus on first? Design for Success

  43. Analyze - FMEA • How can our product, service or process fail? • What are the consequences of failure? • How likely is the failure to occur? • How likely is the customer to be affected? Design for Success

  44. Nested Hierarchy Nationwide L S 1 2 3 4 1 2 3 4 Mutual L S 1 2 3 4 1 2 3 4 Travelers L S 1 2 3 4 1 2 3 4 Carrier Form Type Reason Code Dot Frequency Diagram . Reason Codes 3 2 1 Analyze - Components of Variation (COV) • Where are the major sources of variation? • How much variation is present at each level of the hierarchy? • Where should we focus our efforts to reduce the variation? Design for Success

  45. Improve - MSE • How real is the variation that we observe in our process? • Does the measurement system contribute to the variation? • Is the measurement system adequate? Design for Success

  46. Improve - DOE • Which of the improvement ideas identified with other tools represent the largest payback with respect to the CBI? • Do multiple improvements work in concert to produce a better result? Design for Success

  47. Improve - Action Items • Which of the validated improvements are we going to implement? • What is the expected benefit? • What are the key deliverables? • What is the implementation schedule? • How will we know that the Action Item was successfully implemented? Design for Success

  48. Control/Reaction Plan for Distributions Control - Control and Reaction Plan • Do the key outputs meet the performance standard? • What are the most likely causes of anout-of-standard condition? • What actions need to be taken? • Who is responsible to take the actions? Design for Success

  49. Percent of Transactions Rejected Control - Control Charts • What are the performance trends? • Are we holding the gains from our process improvements? • Is any further action required? Design for Success

  50. Control - Business Impact (ABM) • What is the business impact of the process improvement? • How should the savings be reflected in the current plan or forecast? • Does the improvement free up capacity to satisfy new demand? Design for Success