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Application of Lean Six Sigma
Practical experience
Steven Farr, 12th November 2015
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©2015 Deloitte & Touche (M.E.) All rights reserved 4
Inspiration
Career
Industry
Companies
Education Where I
have lived
Interests
My journey Steven Farr
Family
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Some practical insights Nothing beats going to the ‘Gemba’ and observing, taking photos and
talking to the operational team at the location – ‘Seeing is believing’
If your process doesn’t work don’t just
automate it: Rubbish in = Rubbish out
• Ask why isn’t it working?
• Solve the problem(s) at the root
cause(s) with available tools
• Then ‘Automate’ for efficiency gains
Don’t be afraid to stop a project at any
phase if the business case no longer exists
Don’t skip the basics
Plot, Plot, Plot…
“If the words don’t add up, its usually because the
truth wasn’t included in the equation”
In the words of Clay
Shirky, “there is no such
thing as information
overload, there’s only
filter failure.”
Have an effective pipeline
management process which
assesses priorities throughout
a project’s lifecycle
©2015 Deloitte & Touche (M.E.) All rights reserved 6
“The reasonable man adapts himself to
the world: the unreasonable one
persists in trying to adapt the world to
himself. Therefore all progress depends
on the unreasonable man.”
David and Goliath: Underdogs, Misfits and the Art
of Battling Giants | Malcolm Gladwell
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• Each line produces trash Bags @
750ft/minute (150 to 200 bags/min)
• There are 19 lines in this one facility and
there are four facilities in America
• They run planned maintenance (PM)
every 2 weeks on each line. On average
there is an unplanned maintenance
activity 1½ days after the PM
• They buy in approx. US$1.5m of product
from competitors to meet demand
• Similar problems are seen in: Metal
Fabrication, Paper Mills and other high
speed manufacturing facilities
Case study Trash bag winder system
High speed commodity production with low profit margins
©2015 Deloitte & Touche (M.E.) All rights reserved 9
Plant machine overview Breakdown of machine Areas & Subassemblies. created during
data cleanse
Winder, Drum & Hem Sealer account
for 57.7% of all lost hours.
If we include the Sally, Jones and
Draw tape then these 6 areas account
for over 80% of lost production time.
©2015 Deloitte & Touche (M.E.) All rights reserved 10
49hrs
24hrs
Jacksonville Winder Rotor data analysis Analysing available data from ERP Work Order planning system
Analysis completed of a component
called the ‘Rotor’ on the Winder
system. This component accounts
for 138 hours worth of downtime
over the assessment period.
Non-normal distribution with a right
skew. Therefore shape
characteristics:
• Q1 (25%) at 12 days
• Median (50%) of 38.7 days
• Q3 (75%) at 60 days ©2015 Deloitte & Touche (M.E.) All rights reserved 11
Shape of Hazard Plot verses Bathtub curve Using the Weibull distribution we can develop an idea of the shape,
Survival and Hazard functions using statistical inference
Here the shape of the hazard
function shows clearly that we
are in the range of Decreasing
Failure Rate due to Early “Infant
Mortality” failures.
©2015 Deloitte & Touche (M.E.) All rights reserved 12
Failure Mode and Effect Analysis (FMEA) Whilst waiting for components we conducted a Failure Mode and Effect
Analysis (FMEA) to establish areas of opportunities and potential
frequencies of failures
©2015 Deloitte & Touche (M.E.) All rights reserved 13
“Systems do not fail, components do!”
$5.00 Fishing Tackle Box
Analysis of the Rotor unit bearings Cut a bearing open and discussed with supplier. Focus is on building
these units and checking dimensions
Top Left: Rotor bearing. Was
completely seized. Been installed and
run for 3 weeks
Top Right: Running groves show no
sign of wear
Bottom Right: Outer seal shows high
heat loads and has distorted.
©2015 Deloitte & Touche (M.E.) All rights reserved 14
End Plate Data Working ‘with’ CMD to understand design tolerances for end plates
Bore Diameter
Bore # 1 2 3 4 5 6 7 8
1 1.3770 1.3780 1.3767 1.3766 1.3765 1.3765 1.3766 1.3765
2 1.3772 1.3781 1.3766 1.3765 1.3764 1.3767 1.3767 1.3767
3 1.3772 1.3781 1.3767 1.3767 1.3765 1.3766 1.3766 1.3766
4 1.3770 1.3776 1.3767 1.3766 1.3765 1.3767 1.3767 1.3767
5 1.3770 1.3780 1.3765 1.3766 1.3765 1.3766 1.3767 1.3768
6 1.3771 1.3781 1.3764 1.3766 1.3764 1.3766 1.3767 1.3766 Thermal images of Rotor.
Top reading was at 142°F
(61°C)
©2015 Deloitte & Touche (M.E.) All rights reserved 15
Rotor unit fixture assembly completed Found End plates and spacers too short – had discussions with OEM
supplier and ended up making our own to the correct tolerances
Spacers that are too short (0.015”).
Creates binding of rotor unit adding
to stress issues with bearings.
Spacer length: 0.015” too short on
some units
Bore size too small on some end plates:
Bearing mfr says preferred press fit 0.0003”.
Have seen 0.0005” to 0.0018” press fit.
Fixture assembly: re-enforced to
eliminate flexing during press fit of
bearings
©2015 Deloitte & Touche (M.E.) All rights reserved 16
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©2015 Deloitte & Touche (M.E.) All rights reserved 18
The Mission was split into several key areas:
• Lead Control Agenda
• Deliver Continuous Efficiency
• Manage Processes to Drive Business
Outcome
• Demonstrate Great Customer Service
Values: Proud of what we do; The freedom
to succeed; Be the best; Passionate about
consumers; and We value each other.
An opportunity was identified to deliver value
to the business in DBS Budapest through the
implementation of Lean Workplace to 700
employees
Case study
Business Service Centre
Aim to be ‘The Solutions Division’
Background: Areas of Improvement Large outsourcing activity has meant lots of change within their location
• Focus on steadying the business and making as
many small changes as possible to improve the
overall processes
• Work Life Balance (WLB) levels are excessive for
almost all teams
• Various high periods of demand throughout the
business puts strain on systems and the employees
• Reports locally produced that are known within
business not to be read or sometimes believed
• Quality of information received, and sometimes
delivered, could be improved upon
• Increased awareness of Customer needs and
expectations - Talk to the Customer more often
• Need rapid change across all processes to
achieve Mission Goals
©2015 Deloitte & Touche (M.E.) All rights reserved 19
Lean Workplace: Through “Challenge the Norm”
20
©2015 Deloitte & Touche (M.E.) All rights reserved 20
Principles of a decentralised deployment
©2015 Deloitte & Touche (M.E.) All rights reserved 21
Modular Framework
• Modular framework for local selection
• Supportive tools and a common language
• Simple outcomes and needs
Cultural Resonance
• Language and needs of the local teams
• Pool of success stories
• Share right one at right time
Type of Change
• Individual nature of solutions is very local
• Top down performance drivers
• Core framework uses selective modules at local level
Centralised Strategy
Modular Approach
Multiple Levels
• Understand the needs of each level within the business
• Provide for support all levels
Centralised & Decentralised
• Centralised for programme support
• Decentralised for ownership of delivery
Leadership Behaviours
• Role model
• Seeking and promoting success
• Accountable for change success and sustainability
Leadership Focus
Framing
• National and local level
• Local experimentation and empowerment
Decentralised Change
• Ability to take modules and deliver locally
• Pick and choose
• Local ownership and solutions
Empowerment & Accountability
• Locally own deployment, funding and prioritisation
• Identifies personal risk business is willing to take
Local Accountability
People Segments
• Let early adopters / innovators come forward
• Others observe and participate later
Positive Deviance
• Encourage “Mavericks”
• Unofficial distribution and implementation
Interpersonal Networks
• Encourage peers to discuss the programme
• Formal and/or informal communications
• Yammer, My News, etc
Sharing & Collaboration
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Future of Analytics - Process X-ray Provides detailed analytical visibility into processes and enables objective
improvements based on the truth rather than perceptions and assumptions
Traditional Process Diagnostic vs. X-ray Enabled Diagnostic
Opinion of pain points
Individual
experiences
Perception of
process execution
Actual Process Perceived Process
Qu
alita
tive
inp
uts
Fa
ct-b
as
ed
da
ta
Visualize all variants and their
frequency throughout the actual process Drill down into any variant to identify
issues and gain insight into root causes
View how work flows between
individual users and teams
Objective view of
process execution
Fact-based insights
to pinpoint issues
End-to-end process
execution visibility
Illustrative X-ray Analytics
VS
©2015 Deloitte & Touche (M.E.) All rights reserved 23
X-ray was used to identify $44M in cost savings opportunity in
PTP across 3 countries
• Client aimed to understand the P2P
end-to-end process execution across
three main markets
• Client aimed to identify process
improvement opportunities and to
further harmonize process execution
• Hypotheses are tested to get insight
into process variations
• Workshops are held with regional and
local process owners to acknowledge
findings
• Deep dives are executed for specific
hypotheses to find root causes
• 3 countries were analyzed across
process efficiency, working capital
and compliance, identifying cost
reduction opportunity of $44M
• In a short timeframe, fact-based
opportunities were identified, aligned
on, and implemented to harmonize
processes and drive value
Ba
ck
gro
un
d
Ap
pro
ac
h
X-r
ay V
alu
e A
dd
8 w
ee
ks
• Test variation in P2P
execution in main markets
• Identify improvement
potential in efficiency,
controls and working capital
Overview of process improvement initiatives and
approach for global roll-out
• Structured approach in
which 16 hypotheses are
tested and discussed. On
selected hypotheses deep
dives are executed
• Improvements were
identified in the field of
rework, work distribution,
automation and data
integrity issues
• At the request of the client,
Deloitte supported to build
in-house X-ray capability
Test variation in P2P execution in 3 main markets
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