Integrating lssiso9ts

Integrating Lean & Six Sigma with ISO 9000:2000 &

ISO/TS16949:2002

Achieving Continual Process Improvement

2 © Copyright 2003 Omnex. All rights reserved

First EditionSeptember 2003

Omnex provides training, consulting and software to the international market with offices in the USA, Brazil, Canada, India, Mexico, Venezuela, China (PRC) and Thailand. Omnex offers over 25 training courses in business and quality

management systems worldwide.

3025 Boardwalk Suite 120Ann Arbor, MI 48108

(734) 761-4940email: [email protected]: www.omnex.com

This publication is protected by Federal Copyright Law, with all rights reserved. No part of this publication may be reproduced, stored in a retrieval system, translated, transcribed, or transmitted, in any form, or by any means manual, electronic, electro-magnetic, mechanical, chemical, optical, or

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http://www.omnex.com/


Dave Watkins

President of Omnex Management and Engineering Consultants, LLC, a global training and consulting company headquartered in Ann Arbor, Michigan, Dave Watkins has a wide range of executive and managerial experience in general and automotive manufacturing, as well as production and distribution management, in a variety of industries including custom molded thermo sets and thermosetting materials, chemical processing, metal fabrication and man-made fibers. He has provided training and consulting services in the U.S. and in all major international markets, primarily to senior and executive management groups, in the strategic implementation of integrated management systems incorporating QS/ISO 9001:2000, ISO/TS 16949:2002, QOS/BOS, Product Development & Launch (NPD), and lean enterprise solutions.Dave’s focus is on effectively employing approaches that enhance the client’s ability to create value for customers and stockholders; he is particularly adept at the integration of quality and business management systems to enhance overall performance and to achieve sustainable competitive advantage with significant bottom line impact.Dave has delivered papers on a variety of topics in the U.S., India, Bahrain, Thailand and China.Having pioneered the application of these approaches in non-manufacturing companies, Dave has also authored or co-authored most of Omnex’s seminars for service companies, including ISO 9001:2000 for Service, Advance Quality Planning (AQP) for Service, and QOS for Service. He has trained many of Ford Motor Company’s STAs, Buyers and Suppliers in ISO 9001, QOS, AQP/APQP and Q1 2002 (both manufacturing and service). His education includes a BA from Widener University and numerous professional courses. Dave has served on the Board of Directors of the Illinois Manufacturers’ Association, as a Trustee for the IMA’s Education Foundation, and as a Trustee for Northeastern Illinois University Foundation.


Ron Mitchell

Ron Mitchell is Director of Lean/Six Sigma Services at Omnex. He is a trainer and consultant with over twenty years experience-helping clients to understand and apply Lean Manufacturing and Quality Improvement Technologies. Ron studied the Toyota Production System at NUMMI, the joint General Motors and Toyota Motors Corporation facility in Fremont, California; and, was part of the team that helped launch Synchronous Manufacturing in General Motors. Ron received his training in Quality Management from Dr. W.E. Deming, Dorian Shainin and through The Crosby Quality College. Ron is a Lean Manufacturing Black Belt, a Six Sigma Black Belt and a candidate for Six Sigma Master Black Belt. Ron holds Bachelor’s Degrees in Industrial and Organizational Psychology and a Master’s degree in Organizational Development.


Rationale for Quality Management Systems from ISO 9001:2000

• Enhance customer satisfaction

• Encourages – Analysis of customer requirements– Definition of processes – Process control

• Framework for continual improvement

• Provides confidence in the ability to provide consistent products and services


Omnex Approach:Why Integrate Lean/Six Sigma?

• Achieve and sustain competitive advantage• Employ system approach across the entire

enterprise to determine, deploy and achieve Strategic Objectives

• Employ a dynamic, managed process for continual improvement in products and processes

• Maximize bottom-line impact


Eight Quality Management Principles

• Customer focused organization• Leadership• Involvement of people• Process approach• Systems approach to management• Continual improvement• Factual approach to decision making• Mutually-beneficial supplier relationship


QMS Process Model


Process Focus Versus Functional Focus

AccountingHumanResources

OperationsPurchasing Sales

Top Management

Result Measurables

Process Variation Outputs

Process A

Processes, not functions, Drive Performance


Processes vs. Functions • We are organized functionally

– Maximize use of limited knowledge & skills– Standardize methods and activities– Commensurate with design authority concept

• We work in processes– Do not recognize functional boundaries– Are self defining (making coffee is the same

regardless of the functional organization but differs by customer expectations)

– Fail if any part of the functional input is incorrect or late

– Processes are at different levels of maturity


Characteristics of a Process

• A process can be identified by a series of unique, but consistent, characteristics. There are six characteristics of a process that are mandatory for effective quality management.– A process owner exists– The process is defined

– The process is documented

– The linkages of the process are established– The process is monitored and improved– Records are maintained


Performance Management

Key performance objectives cascade down while performance data pass upward for analysis and action.


Challenge

• ISO 9001:2000:– The organization shall continually improve the

effectiveness of the quality management system through the use of the quality policy, quality objectives, audit results, analysis of data, corrective and preventive actions and management review.

What is your process for managing continual improvement?


Business Excellence Model

Interested Parties

Knowledge Management

CustomerSatisfaction

Customer Expectation &Requirements


Customer

Expectation &

Requirements

Plan

Do

Check

ActDo

Check

Standardize

Study

Act

Knowledge Management

Interested Parties

Lean Six Sigma

Dynamic Continual Improvement

Customer

Satisfaction


Integrated Lean / Six Sigma


Six Sigma Quality

σ DPMO

2 308,537 69.1 % 3 66,807 93.3 % 4 6,210 99.4 % 5 233 99.97 % 6 3.4 99.99966 %

Defects per Million

Opportunities

Process Capability

RTY

Rolled Throughput Yield

(Long Term)

Six Sigma is a Standard of Performance.It means no more than

3.4 Defects per Million Opportunities


The Lean Enterprise

• Lean companies use less of everything than do more traditionally managed companies:– half the human effort in the factory,– half the manufacturing space,– half the investment in tools,

– half the engineering hours to develop a new product in half the time,

– less than half the inventory,


2 days

7.0

45

19

NUMMI

Fremont

Toyota Takaoka

GM Framingham

2 hours2 weeksInventories of Parts (average)

4.88.1 Assembly Space per Car

45135Assembly Defects per 100 Cars

1631Assembly Hours per Car

General Motors Framingham versus Toyota Takaoka versus NUMMI Fremont, 1987

Source: IMVP World Assembly Plant Survey


Toyota Today

• FY 2002 profit report - $12 Billion pre-tax operating profits.• More than Ford, GM & DaimlerChrysler AG....

combined.• On 10% market share compared with 60% for

Ford, GM & Chrysler combined.

• Toyota’s market capitalization (Shareholder Value) of $80 Billion is $10 Billion more than Ford, GM and DaimlerChrysler AG combined.


L/SS Focuses on the Biggest Cost Levers


AccountingHumanResources

OperationsPurchasing Sales

Strategic Measures – Voice of The Customer

Process Variation

Process MeasuresVoice of the Process

Leadership TeamObjectives

Lean / Six Sigma Integrated With BOS

Projects

L e a n S i x S i g m a I m p r o v e m e n t O r g a n i z a t i o n

L e a n S i x S i g m a S e n s e i

L S S P r o j e c t T e a m



L e a n S i x S i g m a P r o j e c t M a n a g e r









L e a n C h a m p i o n


Study the Process – Value Stream Mapping

• To design and communicate the Lean / Six Sigma Vision – the Future State.

• To identify and quantify the improvement opportunities – the gap between the current state and the future state.

• To develop project plans for achieving the future state (integrates Lean & Six Sigma improvement projects).

• To monitor progress toward the Future State.


Profits

Products

Process

Projects

People

Scorecard

Scorecard

Scorecard

Scorecard

Scorecard

BOS

Value Stream Mapping

Continuous Flow Supermarket PullSix Sigma Quality SMED/TPM/Five S

StandardsEducationTrainingResourcesFeedback

Planning for Improvement


Profits

Products

Process

Projects

People

Scorecard

Scorecard

Scorecard

Scorecard

Scorecard

Achieving Improvement

New Knowledge, Skill & Attitudes

New Methods, Policies & Procedures

Lean Productivity Six Sigma Quality

Improved Satisfaction Increased Sales Increased Margins


Solution

• Omnex Lean/Six Sigma Approach:– Provides a systemic approach for continual process

improvement – Is a managed process – Champions/BB/GB Structure– Develops the culture that embraces continual

improvement– Produces Immense bottom line impact


Questions & Answers

Documents

Integrating lssiso9ts