Solving Problems Through Six Sigma

The Uni ersit of AkronThe University of AkronCollege of Business Administration

Six Sigma: Solving Problems Practical Application of DMAIC

Guest Lecture6500:333 Supply Chain & Operations Analysis

Akron, OHNovember 10, 2009

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What is Six Sigma?

A Statistical Measure

66 1Mi ll d d i ll lib

SigmaSigma Spelling ErrorsSpelling Errors Time Keeping ErrorsTime Keeping Errors

3 4

DPMODPMO

99 9997

Yield (%)Yield (%)

6 S d t

Process & Method for Continuous Improvement

66σσ 1 Misspelled word in a small library 3.4 99.99976 Seconds per century

Process & Method for Continuous ImprovementInspecting and Fixing products Fixing processes

Enabler for Culture ChangeF th C t

Ali P l P d S t A d M t i

•Focus on the Customer

University of Akron • College of Business Administration • Fall 20096500:333 Supply Chain & Operations Analysis • Guest Speaker: Michael Ryan

DMAIC | November 10, 2009 1

Align People, Process and Systems on Agreed Metrics

What’s In It For Me?

Where it Started:• Focus on cost and• Focus on cost andInternal productivity

To Where it’s Evolved…To Where it s Evolved• Delighting Customers

S l i P bl t C t Wi Wi S i

and Driving Revenue



Solving Problems to Create a Win‐Win Scenario

It’s All About the Customer

When it’s too anything(hot/cold, light/dark, small/big, etc…)is theit’s not acceptable to the customer

is theENEMY

of the customerQUALITY

C t F l th V i N t th M



Customers Feel the Variance, Not the Mean

The Recipe For Six Sigma

Define: What is the Problem Your Trying to Solve?

Measure: If it Can’t Be Measured, It Can’t be Fixed

Analyze: How & Why do Defects Occur?

Improve: Reduce Process Variation

Control: Maintain The Gain & Keep it Fixed!

S l i P bl t C t Wi Wi S i



Solving Problems to Create a Win‐Win Scenario

Three Keys To A Successful Project

What’s The Problem You’re Trying to Solve

Is it a Process? Can it Be Measured?You re Trying to Solve Measured?

Th K C iti l t P j t S



Three Keys are Critical to Project Success

What is The Problem You’re Solving?

Understanding Customer NeedsUnderstanding Customer Needs• Customers Can’t Always Tell You

Translate Emotion to Data• Customers Can’t Always Tell Youy

Customer: “Your Service Stinks”

Real Problem: “Of the 23 shipments we received from you last year, 2 were received on the requested date, but 14 were at least 2 days late.”



Translate the Voice of the Customer Into “Language Data”

What is a Process?Beginning Middle EndInput Transformation OutputStart And Then Some Magic Happens Finishg pp

Definable: Can draw a picture of it…f p f

Predictable: Know what result will be…

Repeatable: Outcome is assured & repeated…

M t B D fi bl P di t bl d R t bl



Must Be: Definable, Predictable and Repeatable

Customer Needs Must Be Measurable

Critical to Satisfaction (CTS)• “I want a good cup of coffee”

Critical to Quality (CTQ)• Identify measurable characteristics

The Challenge: • Qualitative to Quantitative

How Does the Customer Measure Your Process?*



How Does the Customer Measure Your Process?*Customer Has to Like It, Value It and Be Willing to Pay for It!

Practical Application of Six SigmaExternal Customer: Process Variation Impacting Delivery

Measurable Impact on Customer Satisfaction



Six Sigma In Reviewh h ( )Know What Is Important to The Customer (CTQ)

What is the customer willing to pay for?

Reduce Defects (DPMO)

Identify when & why defects occur 01234 01234

Center Around Target (Mean)

Build quality into the processXbar

Target

Reduce Variation (Standard Deviation)

Improve process capability to maintain the gainUSLLSL

A St t t D i Ch & D li R lt



A Strategy to Drive Change & Deliver Results

“What’s the problem you’re trying to solve?”

Ryanisms / Guiding Thoughts

What s the problem you re trying to solve? and it's corollary…

"What's the question you're trying to answer?”q y y g

…Some favorites:

“If it can’t be measured, it can’t be fixed”If it can t be measured, it can t be fixed“A Process is: Definable, Predictable and Repeatable”“What’s the business case ($) to fix this problem?”($) p"You don't know if you don't ask”

And remember:And remember:

“The measure of success is not whether you have a tough problem to deal with, but whether it’s the same



problem you had last year.”

APPENDIXAPPENDIX



It’s All About the Customer!C t V l C i t d Q litCustomers Value Consistency and Quality• Expect performance, reliability, competitive prices, and on‐time delivery.• When expectations are not met, it creates the opportunity for someone else.

33σσ 1 5 Misspelled words per page in a book

SigmaSigma Spelling ErrorsSpelling Errors

3 5 Months per century

Time Keeping ErrorsTime Keeping Errors

66 800

DPMODPMO

93 32

Yield (%)Yield (%)

33σσ 1.5 Misspelled words per page in a book

44σσ 1 Misspelled words per 30 pages in a book 2.5 Days per century

3.5 Months per century

6,200

66,800

99.379

93.32

55σσ 1 Misspelled word in set of encyclopedias

66σσ 1 Misspelled word in a small library

30 Minutes per century

6 Seconds per century

233

3.4

99.9767

99.9997

The Secret of Success is to Do Common Things Uncommonly Well.



The Secret of Success is to Do Common Things Uncommonly Well.‐ John Rockefeller

A Process of Continuous ImprovementDMAIC: It’s All About ProcessDMAIC: It’s All About ProcessSix Sigma is a highly disciplined process that helps us focus on developing and delivering near‐perfect products and services.

DDefineefine Customer expectations of the process?A. Identify Project CTQ’sB. Develop Team CharterC. Define Process Map

1. Select CTQ Characteristics

MMeasureeasure What is the frequency of defects?1. Select CTQ Characteristics2. Define Performance Standards3. Measurement System Analysis on Y

AAnalyzenalyze Why, when, and where do defects occur?4. Establish Process Capability5. Define Performance Objectivesyy6. Identify Variation Sources

IImprovemprove How can we fix the process?7. Screen Potential Causes8. Discover Variable Relationships9. Establish Operating Tolerances

Si Si B “Th W Y W k”

CControlontrol How can we make the process stay fixed?10. Define & Validate Measurement System11. Determine Process Capability12. Implement Process Control



Six Sigma Becomes “The Way You Work”

Variation is the Enemy of QualityFundamental Objective of Six SigmaFundamental Objective of Six SigmaReduce variation and eliminate defects

Accurate PreciseAccurate AND PreciseAccurate,Not Precise

Precise,Not Accurate

01234 01234

01234 01234 01234 01234

01234 01234

XbarTargetXbar

TargetXbar

Target

C t F l th V i N t th MUSLLSLUSLLSL USLLSL



Customers Feel the Variance, Not the Mean

l k l j ll i b & li

Practical Application of Six Sigma

Black Belt Projects: Full Time Job to Focus & Deliver

Black Belt Projects Lead (7)Fi F i t j t i l diFinance: Four process improvement projects, including:

Removed 1 day from monthly closing cycle for largest business unitGE Superabrasives

Lapping Process EDM Process

EDM Cut Wire DiesGE Superabrasives

Lapping Process EDM Process

EDM Cut Wire DiesClosing Process TimelineClosing Process Timeline

Place parts on lapper

Quick FinishLap (<12 hrs)

Lapper removesMaterial

49 Ho rs

Cut to NearNet Shape

Add Diamond640 g/gal

@ 14 ml/min/

Finished Part Place parts on EDM Finished PartPlace parts on lapper

Quick FinishLap (<12 hrs)

Lapper removesMaterial

49 Ho rs

Cut to NearNet Shape

Add Diamond640 g/gal

@ 14 ml/min/

Finished Part Place parts on EDM Finished Part

2006 - 20071997 - 2005

19961995

Historical Target: Between 1997 and 2005 the Closing Transmission Target = 12pm +6WD

Process Evolution: In 2006, the Closing Transmission Target was moved up to = 12pm +5WD

Days to Close

2006 - 20071997 - 2005

19961995

Historical Target: Between 1997 and 2005 the Closing Transmission Target = 12pm +6WD

Process Evolution: In 2006, the Closing Transmission Target was moved up to = 12pm +5WD

Days to Close

MCR / March 8, 2002Wire Cut Summary.ppt

Eliminated 75% of Lap Feed to Finish 5211/08 Wire DiesGenerated Annual Savings of $96m

Process Issues•Consumes a great deal of lap feed•$2.28 per hour, per piece to lap•Average of $111.72 in lap feed for 5208•On average 49 hours needed to lap 5208

Project Resolution • EDM cutting produces near-net shape• Leaves 0.050” on each side for clean up• Reduces lapping to <12 hrs

49 Hours

Slide 1/2

709.6 ct/hr

MCR / March 8, 2002Wire Cut Summary.ppt

Eliminated 75% of Lap Feed to Finish 5211/08 Wire DiesGenerated Annual Savings of $96m

Process Issues•Consumes a great deal of lap feed•$2.28 per hour, per piece to lap•Average of $111.72 in lap feed for 5208•On average 49 hours needed to lap 5208

Project Resolution • EDM cutting produces near-net shape• Leaves 0.050” on each side for clean up• Reduces lapping to <12 hrs

49 Hours

Slide 1/2

709.6 ct/hr

4CIS Monthly Financial Close Process ImprovementGlobal Finance Quality & Process Improvement

5 Day Close Project is First Major Effort Since 1997

+3 WDNoon

50.5 hrs elapsed

+4 WDNoon

74.5 hrs elapsed

+6 WDNoon

122.5 hrs elapsed

+5 WDNoon

98.5 hrs elapsed

+2 WDNoon

26.5 hrs elapsed

+1 WD9:30 am

0 hrs

+8 WDNoon

170.5 hrs elapsed

+10 WDNoon

218.5 hrs elapsed

4CIS Monthly Financial Close Process ImprovementGlobal Finance Quality & Process Improvement

5 Day Close Project is First Major Effort Since 1997

+3 WDNoon

50.5 hrs elapsed

+4 WDNoon

74.5 hrs elapsed

+6 WDNoon

122.5 hrs elapsed

+5 WDNoon

98.5 hrs elapsed

+2 WDNoon

26.5 hrs elapsed

+1 WD9:30 am

0 hrs

+8 WDNoon

170.5 hrs elapsed

+10 WDNoon

218.5 hrs elapsed

Manufacturing Productivity: Three projects, $430k in productivity including:Wire die scrap reduction, control of sonic velocity, and near‐net shape finishing

L 6 A th B i t D i R lt



Leverage 6σ Across the Business to Drive Results

Practical Application of Six SigmaInternal Customer: Digitization (Process Automation) Project



l j il l

Practical Application of Six Sigma

Green Belt Projects: Integrate Into Daily Role aka “Divide & Conquer”

Green Belt Projects Mentored (20)Green Belt Projects Mentored (20)Finance: 13 reporting, digitization, and process improvement projects, including:

Monthly Closing, Monthly AR, Material Handling, and P&E Status

Environmental, Health, and Safety (EHS): One project focused on Reduced non‐occupational lost‐time days 24%, saving $334k in first full year

Commercial Opportunity: One project focused on excess inventory utilizationCommercial Opportunity: One project focused on excess inventory utilizationIdentified market to sell excess inventory, generating $400k sales1

Manufacturing Productivity: Five projects delivering $459k including:N d lifi ti 2 t ti d ti i t tili tiNew vendor qualification2, setup time reduction, inventory utilization

G B lt 6 B A F M lti li

1. Won 1Q 2002 GE Superabrasives Award for Six Sigma Productivity for inventory reduction program2. Won 3Q 2001 GE Superabrasives Award for Six Sigma Leadership for new vendor qualification



Green Belts: 6σ Becomes A Force Multiplier

Sample Financial Benefit of 6σ : EHS ProjectInternal Customer(s): Hourly Associates & Business Leadership

Reactive Case Management (96 cases @ avg. 70.1 days/case)

6725 Days Lost in ’01

Pro-Active Intervention (64 cases @ avg. 54.5 days/case)

3491 Days Lost in ‘02Employee Informs Disability Center Disability Center InformsGESW Shoulders

B d i L t

Reactive Case Management (96 cases @ avg. 70.1 days/case)

6725 Days Lost in ’01

Pro-Active Intervention (64 cases @ avg. 54.5 days/case)

3491 Days Lost in ‘02Employee Informs Disability Center Disability Center InformsGESW Shoulders

B d i L ty

of Injury/Illnessy

Onsite Care Nurse Regularly of New Cases

Frequency and

Burden in LostTime Days

yof Injury/Illness

yOnsite Care Nurse

Regularly of New Cases

Frequency and

Burden in LostTime Days

Disability Center Informs

Duration of Injury / Illness reduced

Identify OpportunitiesFor early

Return to WorkDisability Center Informs

Duration of Injury / Illness reduced

Identify OpportunitiesFor early

Return to Work

Reactive Case Management•Employee set expectation of return to work date•Onsite Care Nurse notified after the fact

Pro-Active Intervention • Onsite Care Nurse Works with Disability Center and Operations Management team• Each Monday, all open cases are reviewed

yOnsite Care Nurse

of Projected Lost Time

Return to Work

Reactive Case Management•Employee set expectation of return to work date•Onsite Care Nurse notified after the fact

Pro-Active Intervention • Onsite Care Nurse Works with Disability Center and Operations Management team• Each Monday, all open cases are reviewed

yOnsite Care Nurse

of Projected Lost Time

Return to Work

•Onsite Care Nurse notified after-the-fact•No structure for early return to work • Opportunities for early return to work

identified and communicated to employee

•Onsite Care Nurse notified after-the-fact•No structure for early return to work • Opportunities for early return to work

identified and communicated to employee

48% R d ti i L t Ti D S i $356k



48% Reduction in Lost Time Days, Saving $356k

Documents

Solving Problems Through Six Sigma