Implementing Structures and Processes for Lean Six Sigma in Product Development

© Nathan Soderborg, 2008. All rights reserved.

Implementing Structures and Processes for

Lean Six Sigmain Product Development

Dr. Nathan SoderborgDesign for Six Sigma Master Black Belt

North America Product Development

Ford Motor Company

WCBF Global Lean, Six Sigma and Business Improvement Summit

Orlando, Florida

October 15, 2008

2© Nathan Soderborg, 2008. All rights reserved.

Purpose & Outline

Discuss application of Lean principles to Six Sigma in Product Development (DMAIC and DFSS)

� Align projects with customer value

� Increase project throughput

� Root out waste in decision making & scoping

� Generate more profound and lasting benefits

Topics

� Avoid pitfalls in assigning project value

� Institute “pull” systems for filling the project pipeline

� Error Proof—prevent defects before they are created

� Scope wisely—segment large projects into sub-projects


Lean and Six Sigma

� Lean

The elimination of waste with the goal that all steps in a process add value from the customer’s perspective

� Six Sigma

� A statistics-based, data-driven, problem solving methodology

� DMAIC: Define, Measure, Analyze, Improve, Control,

focuses on finding and fixing existing defects in products and processes

� DFSS is a product development (PD) approach that complements DMAIC, focusing on

� Innovation to satisfy customers and improve profitability

� Discovering and preventing defects before they occur in

products or processes


Lean Thinking (Womack & Jones)

� Correctly specify value so you are providing what the

customer actually wants

� Identify the value stream for each product family and

remove the wasted steps that don't create value but do

create muda (waste)

� Make the remaining value-creating steps flow

continuously to drastically shorten throughput times

� Allow the customer to pull value from your rapid-

response value streams as needed (rather than pushing

products toward the customer on the basis of forecasts)

� Never relax until you reach perfection, which is the

delivery of pure value instantaneously with zero muda


Project Value

� Basic product of Six Sigma is a project

� Lean Principle: “Correctly specify value so [projects]

provide what the customer actually wants”

� What does the customer want? Typical answer:

� Defect free products

� Ability to perform the intended function or use

� Performance better than competition in attributes that matter

� Features that satisfy, even enthuse or excite

� Answer focused on value:

� Experience and characteristics that relieve cost from the

customer

� Performance and features for which the customer is willing to pay


Assigning Project Value

� A project is worth doing if

� It saves the end customer money

� Directly: reduced repair bills, service costs, etc.

� Indirectly: time & effort, product marketing/warranty costs that get passed back

� It leads to performance or features for which the customer will pay

(extra)

� Set a standard prioritization scheme and get on with it

� If possible, use existing accounting techniques for projects that cut

costs or will generate revenue

� For projects that prevent future costs

� Assign relative weights to different customer issues based on experience

� Work on issues with high weights and high likelihood of occurrence

� Avoid the waste of instituting complex project value calculations

and involving multiple layers of the finance department

Debating value does not add value


Pull Systems

� Lean Principle: “Allow customer to pull value

from rapid-response value streams as needed”

� “Pull” in lean production means to produce or process

an item only when the customer needs and requests it

� Lean manufacturers design their operations to respond

to the ever-changing requirements of customers

� Such operations avoid the traditional batch-and-queue

system many manufacturers must rely on

� Pull systems

� Should be convenient and easy to use

� React to needs—don't anticipate them


Example: Pull in a Manufacturing Process

� A light bulb is set up on a pole at an assembly line; when the light goes on, it is the signal (kanban) to

the producing station to wheel over a cart of

components to the assembly line

� A full cart is dropped off at the assembly line and an

empty cart is wheeled back to the producing station—the empty cart is the signal that authorizes

the producers to make more parts

� Finished components from the last operation at the

producing station are placed directly on the cart—if there is no cart there is no production

� The process eliminates double handling

� Parts are placed on the cart as produced

� Parts are taken off the cart during the first operation at the assembly line and put directly into an assembly


Filling the DMAIC Project Pipeline

For projects related to Defect Elimination,

pull comes from…

� Repair/Service Data

� In plant repairs (surrogate for customers)

� Warranty claims (sellers & customers)

� Survey Data

� Customer satisfaction

� Complaints: “Things Gone Wrong”

What are customers

complaining about

right now?

Where are customers

experiencing problems right now?

Prioritize on data from first few weeks or months of ownership—often correlates well to data from higher time in service


“When ____ arrived six months ago, he found ____'s quality

operations bogged down with drawn-out decision making and

interdepartmental finger-pointing.

“If there was a problem with an air conditioning system, for example, the

engineering department might suggest the plant didn't put oil in the unit,

while the plant might say the unit was improperly designed. Weeks of back-

and-forth e-mails would ensue, "and meanwhile, the customer is out there

saying, 'I'm hot,'‚" ____ said.

“____ scrapped the old system, created standard definitions of quality, and

established the view that customer satisfaction starts with a potential

customer's perception of a brand and continues though vehicle ownership and

repurchase.

“He launched dedicated interdepartmental teams to address problems in

minutes over conference tables, not weeks over e-mail.”

Detroit News, April 14, 2008

Recently In the News


Customer

brings vehicle

to dealer for

service

Customer Pull

Example

� “Every warranty claim received by a dealer is sent to

the plant where the vehicle is built and the issue is

‘mapped back’ to the work station where it might have

originated.”Ford’s Drive One campaign, answers for employees to FAQs related to Quality

Dealer fixes

issues and

records

information

Information is

sent to plant

immediately for

review

Plant groups

issues and

shares with

engineering

Issues with

highest

frequency are

next up projects

Project Portfolio


Reaction to Field Concerns is just the Beginning

� Even better than reacting quickly when (1) customers

discover failures, is to react quickly to (2) failures

discovered in development

� Find them before they escape

(ideally as soon after creation as feasible)

� Immediately mitigate their effect

(on customer and the organization)

� Even better than reacting quickly to failures discovered

in development is to (3) prevent creation of the defect

that leads to failure in the first place

� Because no process or person is perfect, we need to

plan for and address all three scenarios


Lessons from High Reliability Organizations

� “HROs” exhibit

� Preoccupation with failure

� Reluctance to simplify interpretations

� Sensitivity to operations

� Commitment to resilience

� Deference to expertise

� “…high reliability organizations are preoccupied with small,

emerging, early failures aka problems (failures in the sense of things

not working out exactly as expected). They see those small failures

as clues that the system is not as healthy as they thought it was.

Those early small failures are also easier to deal with than are full blown failures. And HROs spend a great deal of time and effort to

catch stuff while it is still small.”“Revisiting Mindfulness, Managing the Unexpected, and the Cerro Grande Staff Ride”http://www.myfirecommunity.net/documents/Santa_Fe_post_conference_reflections_kms.pdf

Karl Weick & Kathleen SutcliffeManaging the Unexpected: Assuring High Performance

In an Age of Complexity, John Wiley & Sons, 2001


Defect Creation

� Failures result from product or process defects (Defect: “an imperfection that impairs worth or utility;” for our

purposes, can include gaps to competition or company targets)

� Defects are not created at the moment the product is

manufactured or the process is instituted—they are created

much earlier, during development

� For example

� Wrong identification of requirements important to customer, wrong targets

� Incorrect assessment of environmental, usage, manufacturing conditions

� Selection of an inadequate or non-robust design concept

� Incorrect characterization of the system, e.g., use of an inaccurate model

� Improper optimization assumptions or methods

� Selection of inadequate materials, geometry, interfaces

� Mistakes in execution of design or build

� Using detection events that can’t detect defects, ETC.


Example

The I-35W Mississippi River bridge catastrophically failed during the

evening rush hour on August 1,

2007, collapsing to the river and riverbanks beneath. Thirteen people

were killed and approximately one hundred more were injured.

The defect that led to the collapse was not created

when the bridge was built.

When was it created?


“Although the Board's investigation is still on-

going and no determination of probable cause has

been reached, interim findings in the investigation

have revealed a safety issue that warrants

attention," said NTSB Chairman Mark V.

Rosenker. …

“This review discovered that the original design

process of the I-35W bridge led to a serious error in

sizing some of the gusset plates in the main truss.

“Undersized gusset plates were found at 8 of the

112 nodes (joints) on the main trusses of the bridge.

These 16 gusset plates (2 at each node) were

roughly half the thickness required and too thin to

provide the margin of safety expected in a properly

designed bridge.”

NTSB URGES BRIDGE

OWNERS TO PERFORM

LOAD CAPACITY

CALCULATIONS BEFORE

MODIFICATIONS; I-35W

INVESTIGATION

CONTINUES; Jan 15, 2008, http://www.ntsb.gov/Pressrel/2008/080115.html

http://minnesota.publicradio.org/display/

web/2008/06/03/astaneh_bridgecollapse


� Apparently the defect was created in two parts: first, in the analysis and decision making process during design; second,

with the later modification to the bridge

� Nevertheless, the defect could have been detected prior to the

collapse by engineering analysis and calculation

“The… bridge was brought down by too much weight

from construction materials and pavement added to the

roadway years before, a structural engineering expert

reports in a paper delivered today… Hassan Astaneh's

research concludes MnDOT and the consulting firm it

hired could have prevented the collapse.”…

“In January the National Transportation Safety Board reported the bridge's

gusset plate at node U10 was undersized. Last August, Astaneh's research

found the same thing. But Astaneh says despite this design flaw, the plate

would have held up if it weren't for the extra weight.”--“Study: Heavy construction materials, added pavement brought down 35W bridge,” by Sea Stachura,

Minnesota Public Radio, June 4, 2008, http://minnesota.publicradio.org/display/web/2008/06/03/astaneh_bridgecollapse/


Waste Due to Defects

� A defect created at a certain point in the development

process cannot be fixed without revisiting that point in

the process

� Work completed after the defect is created is subject to

be re-done or at least re-evaluated: WASTE

� The further downstream the defect is

detected, the more re-work is required

to mitigate it

� When the customer detects the defect, there is not only

re-work needed to fix it, but potentially severe

implications for corporate image, customer satisfaction,

sales, profits, etc.


Filling the DFSS Project Pipeline

For projects related to Defect Detection

& Mitigation, pull comes from…

� Process Health Indicators

� Launch Concerns

� First time through and re-work metrics

� Number of part changes during development

� Results of Detection Events

� Checks against Design Standards

� Computer Simulations

� Physical Tests

Where are resources

being spent now?

Where are the

emerging problems?

(Things we know we know)


Filling the DFSS Project Pipeline

For projects related to Defect Prevention

& Business Opportunity, pull comes from…

� History

� Sustained high warranty costs

� Chronic gaps to competition in

survey results (e.g., JD Power)

� Launch concern trends

� Part change trends

� Design Review Discoveries

� Defect Anticipation (e.g., using structured tools

such as FMEA, FTA)

� Risk Analysis

What area or discipline

have we not yet mastered?

What concerns are

revealed after thorough

review?

(Things we know we don’t know)

(Things we don’t know we don’t know)

“Pull systems react to needs, don't anticipate them.”

If capability won’t meet demand, the defect already

exists. Identify it and react.

Identification


Example

Toyota’s GD3 and Design Review

Based on Failure Mode (DRBFM)

� Good Design

“A fundamental principle for reliability is to avoid changing the conditions of

a good design.”

� Good Discussion/Good Design Review

“We implemented Good Design Reviews in the development process as a creative “breakthrough”… This breakthrough

emphasizes discovery of undetected problems caused by intentional or incidental changes. Good Design Review is a

process of thoroughly discussing design plans to discover

undetected problems (Good Discussion), and of formulating countermeasures to solve those problems one by one.”

Hirokazu Shimizu, Toshiyuki

Imagawa, Hiroshi NoguchiReliability Problem Prevention Method for Automotive Components, SAE 2003-01-2877


Example

� Design Review Based on Failure Mode

� “Pay close attention to intentional and incidental changes in new development items.”

� “Promote discussions based on FMEA and FTA results.”

Reliability Problem Prevention Method for Automotive Components—Development of GD3 Activity

and DRBFM (Design Review Based on Failure Mode), JSAE 20037158, SAE 2003-01-2877


Sources of Project Pull: Summary

� Chronic Repair/Service Issues

� Chronic Survey Gaps

� Design Review Discoveries

� Defect Detection Events

� Process Health Indicators

� Current Survey Data

� Current Repair/Service Data

From the Lean perspective: Proactive is Reactive

Reacting to the right things is how to be proactive

DMAIC

DFSS

Proactive

Reactive


Product Development Error Proofing

� Projects react to the identification of defects

� The final step in any project must be implementing

permanent corrective actions, determining…

� How, in the future, we will operate differently and in a standardized way

� What structures (controls) have been put in place to ensure this will continue to happen

� Examples of Design Error Proofing (SOPs)

� Established design guidelines (don’t reinvent good design

practices)

� Better methods for detecting defects earlier (including

simulation and component testing)

� More robust design concepts and solutions

Never close a project without institutionalizing the learning


Final Observations on Project Scoping

� Proper scope reduces waste & re-work

� Originally, we planned DFSS projects to take a system

through the entire PD process (months to years)

� Projects needed adjustment with movement of key people

� Hard to maintain focus over many months

� Changes in direction at higher levels negate previous work

� Subdivide big projects

� Multiple small projects, each focused on eliminating a single defect or few related defects

� Projects for each phase of the development process (e.g. Definition, Characterization, Optimization, Verification)—as

we know different types of defects arise in each phase

� Let the most current circumstances “pull” scope


Benefits of Focus

� Situation: A black belt is requested to split time

between two “equally important” DFSS projects

� Scenario 1: The black belt works on them

simultaneously and completes both in 6 months

� Scenario 2: The black belt focuses entirely on one

project for 3 months and completes it, then works on

and completes the second project in 3 months

Is one scenario better?

� Scenario 1: neither project is finished for 6 months;

average time to complete projects=6 months

� Scenario 2: one project is finished in 3 months; one in

six months; average time to completion=4.5 months


Example Deliverable Scopes for DFSS Projects

Institute technical training

Improve detection

measurement

system/gage RR

Add/intensify noise

content in a test or

simulation to better excite

failure modes

Develop/improve a

transfer function (model)

to discover failure modes

analytically

Create a new detection

event or standard

Develop/improve a

customer-correlated

metric, target

Replace a test or

simulation event with a

design standard

Replace a hardware test

by a virtual simulation

Move a detection event

from a system to

subsystem or component

level

Improve design to reduce

severity of a failure mode

Institute updated

procedures and error-

proofing to prevent

mistakes

Institute generic robust

design guidelines

Institute product-specific

design improvements,

e.g., optimize for

robustness

Implement a new, robust

concept

Increase Detection Capability

Move Detection Capability Earlier

Make Designs More Reliable/Robust


REFERENCES

� Tim P. Davis, “Science, engineering, and statistics,” Applied Stochastic Models in Business and Industry, Vol. 22, Issue 5-6,

pp401-430, 2006.

� James M. Morgan and Jeffrey K. Liker, The Toyota Product

Development System: Integrating People, Process and Technology, Productivity Press, 2006.

� James P. Womack and Daniel T. Jones, Lean Thinking: Banish Waste and Create Wealth in Your Corporation, Simon and Schuster, 2003.

Collapsed bridge photo from Wikipedia: This image or file is a work of a United States Coast Guard service personnel or

employee, taken or made during the course of that person's official duties. As a work of the U.S. federal government, the image or file is in the public domain (17 U.S.C. § 101 and § 105).

Standing bridge photo from Wikipedia: Permission is granted to copy, distribute and/or modify this document under the terms of

the GNU Free Documentation License, Version 1.2 or any later version published by the Free Software Foundation

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Implementing Structures and Processes for Lean Six Sigma in Product Development