define phase six sigma fundamentals

Define PhaseSix Sigma Fundamentals

Define PhaseSix Sigma Fundamentals

© Open Source Six Sigma, LLCOSSS LSS Yellow Belt v10.0 - Define Phase 2

Six Sigma Fundamentals

Voice of the CustomerVoice of the Customer

Cost of Poor QualityCost of Poor Quality

Process MapsProcess Maps

Process MetricsProcess Metrics

Six Sigma Fundamentals

Selecting Projects

Elements of Waste

Understanding Six Sigma

Wrap Up & Action Items


What is a Process?

Why have a process focus?– So we can understand how and why work gets done– To characterize customer & supplier relationships– To manage for maximum customer satisfaction while

utilizing minimum resources– To see the process from start to finish as it is

currently being performed– Blame the process, not the people

proc•ess (pros′es) n. – A repetitive and systematic series of steps or activities where inputs are modified to achieve a value-added output

proc•ess (pros′es) n. – A repetitive and systematic series of steps or activities where inputs are modified to achieve a value-added output


Examples of Processes

• Injection molding• Decanting solutions• Filling vial/bottles• Crushing ore• Refining oil• Turning screws• Building custom homes• Paving roads• Changing a tire

• Recruiting staff• Processing invoices• Conducting research• Opening accounts• Reconciling accounts• Filling out a timesheet• Distributing mail• Backing up files• Issuing purchase orders

We go through processes everyday. Below are some examples of those processes. Can you think of other processes within your daily environment?


Process Maps

• The purpose of Process Maps is to:– Identify the complexity of the process– Communicate the focus of problem solving

• Process Maps are living documents and must be changed as the process is changed– They represent what is currently happening, not what you

think is happening.– They should be created by the people who are closest to the

process

Step AStart

Insp

ect

FinishStep B Step C Step D

Process Map


Process Map Symbols

Standard symbols for Process Mapping (available in Microsoft Office™, Visio™, iGrafx™ , SigmaFlow™ and other products):

A RECTANGLE indicates an activity. Statements within the rectangle should begin with a verb

A DIAMOND signifies a decision point. Only two paths emerge from a decision point: No and Yes

An ELLIPSE shows the start and end of the process

A PARALLELAGRAM shows that there are data

An ARROW shows the connection and direction of flow

1A CIRCLE WITH A LETTER OR NUMBER INSIDE symbolizes the continuation of a flowchart to another page


High Level Process Map

One of the deliverables from the Define Phase is a high level Process Map, which at a minimum must include:

– Start and stop points– All process steps– All decision points– Directional flow– Value categories as defined below

• Value Added:– Physically transforms the “thing” going through the process– Must be done right the first time– Meaningful from the customer’s perspective (is the customer

willing to pay for it?)• Value Enabling:

– Satisfies requirements of non-paying external stakeholders (government regulations)

• Non-Value Added– Everything else


Process Map Example

A Process Map for a Call Center -

START

LOGON TO PC &APPLICATIONS

SCHEDULEDPHONE TIME?

LOGONTO PHONE

CALL orWALK-IN?

PHONE DATACAPTURE BEGINS

DETERMINE WHOIS INQUIRING

ACCESS CASE TOOL

CASE TOOLRECORD?

Y

N

A

Z

CALL

WALK-IN

DETERMINE NATUREOF CALL & CONFIRM

UNDERSTANDING

Y

N C

B

D PHONETIME

Y

N

Z

B

C

REVIEW CASETOOL HISTORY &

TAKE NOTES

PUT ON HOLD,REFER TO

REFERENCES

IMMEDIATERESPONSEAVAILABLE?

Y

N

TRANSFERAPPROPRIATE?

Y

N

TRANSFERCALL

ANSWER?Y

N

QUERY INTERNALHRSC SME(S)

ANSWER?Y

N

OFF HOLD ANDARRANGE CALL

BACK PHONE DATAENDS

PROVIDERESPONSE

PHONE&NOTE

DATA ENDS

D

ADD TORESEARCH

LIST

Z

LOGOFF PHONE, CHECKMAIL,E-MAIL,VOICE MAIL

SCHEDULEDPHONE TIME?

N

YA

E

EXAMINE NEXT NOTEOR RESEARCH ITEM

ACCESS CASE TOOL

ENTER APPROPRIATESSAN (#,9s,0s)

IF EMP DATA NOTPOPULATED, ENTER

OLDCASE

Y

N

UPDATE ENTRIESINCL OPEN DATE/TIME

CREATE A CASEINCL CASE TYPE

DATE/TIME, &NEEDED BY

AUTOROUTE

YROUTE

CASECLOSED

N

Y

N

CLOSE CASEW/

DATE/TIMEE

TAKE ACTIONor

DO RESEARCH

F

GO TOF or E

DEPENDING ONCASE F

ENEXT


Cross Functional Process Map

When multiple departments or functional groups are involved in a complex process it is often useful to use cross functional Process Maps.

– Draw in either vertical or horizontal Swim Lanes and label the functional groups and draw the Process Map

Gen

era

l A

ccou

nti

ng

Ban

kFi

nan

cial

Acc

ou

nti

ng

Ven

dor

Dep

art

men

t

Start Requesttransfer

Attach ACHform toInvoice

Produce anInvoice

Fill out ACHenrollment

form

Receivepayment End

Vendorinfo inFRS?

Input info intoweb interface

Match againstbank batch

and daily cashbatch

Accepts transactions,transfer money andprovide batch total

Review andProcess

transfer inFRS

3.0Journey Entry

21.0Bank

Reconciliation

Maintain database to balance ACHtransfers

ACH – AutomatedClearing House.

No

Yes

Sending Fund Transfers


Process Map Exercise

Exercise objective: Using your favorite Process Mapping tool create a Process Map of your project or functional area.

1. Create a high level Process Map, use enough detail to make it useful.• It is helpful to use rectangular post-it’s for

process steps and square ones turned to a diamond for decision points.

2. Color code the value added (green) and non-value added (red) steps.

3. Be prepared to discuss this with your mentor.


Do you know your Customer?

Knowing your customer is more than just a handshake. It is necessary to clearly understand their needs. In Six Sigma we call this “understanding the CTQ ’s” or critical to customer characteristics.

Voice Of the Customer Critical to Customer Characteristics


Voice of the Customer

Voice of the Customer or VOC seems obvious; after all, we all know what the customer wants. Or do we??

The customer’s perspective has to be foremost in the mind of the Six Sigma Belt throughout the project cycle.

1. Features• Does the process provide what the customers expect and need?• How do you know?

2. Integrity• Is the relationship with the customer centered on trust?• How do you know?

3. Delivery• Does the process meet the customer’s time frame?• How do you know?

4. Expense• Does the customer perceive value for cost?• How do you know?


What is a Customer?

There are different types of customers which dictates how we interact with them in the process. In order to identify customer and supplier requirements we must first define who the customers are:

External– Direct: those who receive the output of your services,

they generally are the source of your revenue– Indirect: those who do not receive or pay for the output of

your services but have a vested interest in what you do (government agencies)

Internal- those within your organization

who receive the output of your work


Value Chain

The relationship from one process to the next in an organization

creates a “Value Chain” of suppliers and receivers of process outputs.

Each process has a contribution and accountability to the next to

satisfy the external customer.

External customers needs and requirements are best met when all

process owners work cooperatively in the Value Chain.

Careful – each move has many impacts!


What is a CTQ?

• Critical to Quality (CTQ ’s) are measures that we use to capture VOC properly. (also referred to in some literature as CTC’s – Critical to Customer)

• CTQ ’s can be vague and difficult to define.– The customer may identify a requirement that is difficult to

measure directly so it will be necessary to break down what is meant by the customer into identifiable and measurable terms

Product:• Performance• Features• Conformance• Timeliness• Reliability• Serviceability• Durability• Aesthetics• Reputation• Completeness

Service:• Competence• Reliability• Accuracy• Timeliness• Responsiveness• Access• Courtesy• Communication• Credibility• Security• Understanding


Developing CTQ’s

Identify Customers• Listing• Segmentation • Prioritization

Validate CTQ s• Translate VOC to CTQ’s• Prioritize the CTQ’s• Set Specified Requirements• Confirm CTQ’s with customer

Capture VOC• Review existing performance• Determine gaps in what you need to

know• Select tools that provide data on gaps• Collect data on the gaps

Step 1

Step 2

Step 3


Cost of Poor Quality (COPQ)

• COPQ stands for Cost of Poor Quality

• As a Six Sigma Belt, one of your tasks will be to estimate COPQ for your process

• Through your process exploration and project definition work you will develop a refined estimate of the COPQ in your project

• This project COPQ represents the financial opportunity of your team’s improvement effort (VOB)

• Calculating COPQ is iterative and will change as you learn more about the process No, not that

kind of cop queue!


The Essence of COPQ

• COPQ helps us understand the financial impact of problems created by defects.

• COPQ is a symptom, not a defect– Projects fix defects with the intent of improving symptoms.

• The concepts of traditional Quality Cost are the foundation for COPQ.– External, Internal, Prevention, Appraisal

• A significant portion of COPQ from any defect comes from effects that are difficult to quantify and must be estimated.


COPQ - Categories

External COPQ

Internal COPQ

• Warranty• Customer Complaint

Related Travel• Customer Charge Back

Costs• Etc…

Prevention

• Error Proofing Devices• Supplier Certification• Design for Six Sigma• Etc…

Detection

• Supplier Audits• Sorting Incoming

Parts• Repaired Material• Etc…

• Quality Control Department

• Inspection• Quarantined

Inventory• Etc…


COPQ - Iceberg

Rework

InspectionWarranty

Rejects

Lost sales

Late delivery

Engineering change orders

Long cycle times

Expediting costs

Excess inventory

Hidden Costs

Visible Costs

Lost Customer Loyalty

More Set-ups

Time value of money

Working Capital allocations

Excessive MaterialOrders/Planning

Recode

(less obvious)

define phase six sigma fundamentals

Documents

sigma belt

llcosss lss yellow belt

process map open source

process maps open source

center open source

value chain open source

complex process

cross functional process