Operational Excellence Using Lean Six Sigma · Operational Excellence using Lean Six Sigma • Increasing globalization & competitive pressures compelling organisations to raise their

© Amit Dasgupta 1111

Operational Excellence using Lean Six Sigma

Amit Dasgupta


Contents

Introduction to Operational Excellence

Deployment Practice

Our Services


Operational Excellence using Lean Six Sigma

• Increasing globalization & competitive pressures compelling organisations to raise their performance bar

• Consequently, Operational Excellence (OE) is high on the priority list of many companies

• Yet, finding ways to actually enable operational excellence remains a challenge

• Top companies with successful track records have discovered Lean Six Sigma as an effective approach for operational excellence. Some examples:

• The right operations strategy using a holistic approach involving key stakeholders, focused not just on efficiency but also on innovation, can help institutionalize operational excellence in an organization.

� Motorola adopted Six Sigma in 1987 – The company saved $16 billion in 10 years

� In The first year Xerox’s saved $240,000 using Lean Six Sigma, through reduction in production loss

of toner. Also Xerox helped Bank of America save $800,000 by consolidating document centers

� Toyota worked with one supplier to reduce lead time by 46%, work-in-process inventory by 83%,

finished goods inventory by 91%, overtime by 50%. All this increased productivity with 83%.

Source: Business week and Internet


Operational Excellence Framework

Teamwork

ProcessesPerformance Management

Continual Improvement

Leadership

Operational Excellence

Mindset ChangeCollaborationExecution

FlowValue Addition Best Practices

MeasurementBenchmarkingControl

Learning & KMAdaptive

Strategy

Cust

om

er

Focu

s

Quality

Innova

tion

Drivers

VisionCommitment

Enablers

This framework is adoptedto institutionalize OE


Concept of Lean Six Sigma

Lean is about doing more with less: less time, inventory, space,

labor, and money.

It is a commitment to improving efficiency by eliminating or reducing waste and non value added activities

Six Sigma seeks to improve the quality and reliability of processes and

minimizing variability using quality management and statistical methods

What is Lean Six Sigma?

• Lean Six Sigma, is a marriage of two distinct business management strategies.

• As a result, Lean Six Sigma allows managers to effectively address issues of speed,

quality and cost.

Product or Service Output

Critical Customer Requirement

Defects: Service unacceptable to

customer

B A

Product or Service Output

Critical Customer Requirement

Defects: Service unacceptable to

customer

B A

As-Is Flow To-Be Flow

� Simplifies work flows,

� Eliminates waste,

� Focuses on high-value steps

� Increases consistency

� Reduces variation

� Eliminates defectsLean Six Sigma


Contents


Deployment Practice

Our Services


Lean DADIM Method

Project SelectionProject CharterMobilize Team

SIPOCDemand FlowCause and EffectValue Stream Map

Brainstorm Possible SolutionsApply LSS PrinciplesPoka YokeFuture State MapImpact Benefit AssessmentFuture State Components

DashboardEnsure Controls Handover ProcessProject Closure

Define

Manage

Implement

Deve

lop

Analyze

PrioritizeImplementation PlanTest Solution

Rollout SolutionsMeasure BenefitsCommunication


Lean Deployment - Workshop Driven Approach

W4W3W2 W5W1

• Mobilisation & Training 1 week • Deployment 10-12 Weeks/Project • Report out to sponsors & management team after each workshop

1 Week 2 Weeks4 Weeks2 Weeks2 Weeks1 Week

Mobilize

• Identify Value Stream

• Select Team• Training

Define

• Project Charter SIPOC, VOC

• Data Collection • Demand Flow• Value Tree

Analyze

• Fish Bone Diagram • Interviews• Work Flow• Current State

Map• Value Analysis

Design

• Brainstorming• Future State Design

• Action Plans• KPIs

Implement

• Prioritization• Test Cell• Implement• Measure

Manage

• Dashboard• Establish Controls• Handover

Leadership Commitment

Establishing Leadership commitment and sponsorship, the most important success factor for operational excellence. Leadership is assisted to; articulate company’s strategy and vision & communicate the importance of operational excellence

Value Stream Selection

Assistance in selection of process areas for deploying Lean Six Sigma, that are closely aligned to company’s business goals

Training

• Awareness creation and training on Operational Excellence framework, Lean Six Sigma & Kaizen principles, tools & techniques and performance management

• Experiential learning through simulation games• Training for Lean Six Sigma certification

Workshops

• A participative workshop driven approach is followed, where teammembers are actively involved in assessing the current situation, identifying areas for improvement and designing process changes.

• Extensive use of visual charts & templates to improve effectiveness• Periodic report out to sponsors and management team• Our consultations mainly coach, guide and facilitate.

A proven practice of workshop based deployment ensures successful results


Workshop Artifacts

• Active participation by teams. • Use of visual charts & templates to

design & deploy Lean processes


1. Committed Leadership

Strong Leadership commitment is absolutely essential and the most

important of all success factors

2. Employee Teamwork and Collaboration

Operational excellence is a collective responsibility for which ownership,

teamwork and collaboration is necessary

3. Performance Measurement & Benchmarking

Without well defined key performance indicators and processes for measurement,

success of operational excellence cannot be established or sustained

4. Alignment of Lean projects to Business Vision

Unless Lean projects are closely aligned to business strategy, full

potential for benefits may not be realized

5. Mindset Change

Success of operational excellence is largely dependant on cultural

and mind set change towards continual improvement

Critical Success Factors


Benefits of Operational Excellence

Financial Benefits

– Creates additional new revenue streams

– Cost savings

– Increases profitability of existing products & services

– Lowers cost of production and servicing

Organizational Benefits

– Creates new customer opportunities

– Fosters collaboration and teamwork to accomplish

company goals

– Improves market position relative to competitors

Operational Benefits

– Decreases employee work loads for undesirable work

– Eliminates non-value added activities

– Improves employee morale, team spirit and productivity

– Improves use of resources – equipment, assets, space,

people and money

– Simplifies processes and improves throughput

Large companies across the world have reported benefits in billions of dollars

Savings of 20-50% in Value Streams quite common

Case Study - Gold Seal Engineering Products Ltd.

Production Space: Increased by 45%Machine Downtime: Reduced by 60%Machinery Breakdown: Reduced by 42%Scrap: Reduced by 75%Standard Operating Procedures: Increased by 50%Workforce Flexibility: Increased by 57%Quality Awareness: Increased steadilyStaff Motivation: Improved significantly

Source: e-coach – UNIDO Partnership Programme


Contents


Deployment Practice

Our Services


Services … Consulting

We offer consulting services and training to assist organisations, embark on

their Operational Excellence journey & build capabilities internally, to sustain OE

Consulting

We support companies in initiating operational excellence by:

• Assisting senior management team to articulate company’s vision, strategy, and business

objectives to their middle and junior management teams

• Developing communication plans to convey management’s commitment to operational

excellence and its impact on achieving business goals

• Identifying and prioritizing functions and processes where LSS could be successfully applied

• Awareness creation and training on Operational Excellence with Lean Six Sigma

• Guiding and facilitating LSS project deployment across multiple process areas

• Designing performance management systems for monitoring KPIs and visual controls

• LSS toolkits and workplace best practices

• Developing transformation and change management programs to build a culture of

excellence and continual improvement


Services …Training

Training Objectives

Training is aimed at helping participants get insights on:

• The importance of leadership and teamwork in operational excellence

• The enablers and drivers for achieving operational excellence

• Lean Six Sigma and Kaizen techniques, tools and deployment framework

• The importance of customer focus, value addition and flow to achieve higher customer satisfaction

• Analysis of current business processes to reduce waste and non value added activities to deliver faster process times and improve profitability

• How to design, deploy and manage process changes

• Performance management, metrics, KPIs and visual communication to monitor process adherence, improve quality and manage delivery

• How to achieve mindset change within the organisation to embrace a culture of continual improvement and learning

Training MethodologyThe training methodology is interactive and workshop based, using simulation games to get a

direct experience on application of Lean Six Sigma concepts, techniques & tools necessary to

develop operational excellence.

Training Modules

• Introduction to Operational Excellence & LSS – 1 day

• Operational Excellence Deployment for a deeper understanding on application of OE – 2-3 days

• Training for Lean Six Sigma Certification

Operational

Excellence

Documents

Operational Excellence Using Lean Six Sigma · Operational Excellence using Lean Six Sigma • Increasing globalization & competitive pressures compelling organisations to raise their