Improvement That Flows to the Bottom Line Requires

• Vision• Focus on Customers and Employees• Active Leadership Involvement and Alignment• Willingness to Break Established Paradigms• Hierarchy of Trained, Empowers, and

Incentivized Employees• Constancy of Improvement Activity• Celebrate and Reward Success

Dick LewisRoll Royce COO 2001-2004

MIT 16.660 – Jan 2008

Notes

• Teams• DMAIC (adapted from the Deming Cycle)– Define (Process map, problem definition, metrics,

improvement goals)– Measure (Process analysis, statistics, data

collection & analysis)– Analyze (Data analysis, Lean, FMEA)– Improve (DOE, Kaizen, Non-value eliminated)– Control (Poka-Yoke, 5S, Kanban, SPC, TPM)

notes

• Metrics (defined by the voice of the customer)– On-time delivery– Delivered Product Quality– First Pass Test Yields– Past Due receivables– Capital ROI

• Started with “Low hanging Fruit”– 5S, multi-skills training, supply chain– Leadership Team, metrics, organizational restructuring,

focus on data– Saved 3% ($150M the 1st yr)

notes

• Reduce the Barriers to Change– Define the burning platform– Obtain buy-in from key stakeholders– Communicate3

– Dispatch the resistance– Reward Results (recognition and rewards)