developing the six sigma implementation strategy at dow corning corp

Developingthe

Six SigmaImplementation Strategy

atDow Corning Corp.

Developingthe

Six SigmaImplementation Strategy

atDow Corning Corp.

17 February 2005

Douglas R. Pratt, P.E.Director, Six Sigma Process Excellence

Dow Corning Corporation

© 2005 Dow Corning Corporation2

“It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change.”

- Charles Darwin

© 2001 Dow Corning Corporation


Who is Dow Corning ?


Dow Corning –• Established in 1943 specifically to explore the potential of silicones. • A joint venture, equally owned by Corning Glass Works (now Corning, Inc.) and The Dow Chemical Company.• Provides performance-enhancing solutions to serve the diverse needs of more than 25,000 customers worldwide. • A global leader in technology and innovation based on the element silicon.• ~ 7,000 products and services, ~ 8500 employees providing SOLUTIONS to customers. • More than half of Dow Corning’s annual sales* are outside the United States.• Dow Corning initiated Six Sigma in 2001.

* ~2.8 billion USD, 2003


The Dow Corning family...

HEMLOCKSEMICONDUCTORCORPORATION


Points of discussion:

- Pre-Six Sigma- Implementation - Present issues- ‘I wish we would have….’- Things we’re proud of…. - Questions


How does a small or medium-size

organization implement

Six Sigma……?

A case study…..


Pre-Six Sigma at Dow Corning…….

Total Quality Management (mid-1980s). Brought statistical techniques (SPC). Team problem solving. Enterprise-wide. No direct measured results. Not customer focused.

‘Renewal’ (late 1980s) - ?? Localized ‘LEAN’ (JIT) efforts at sites (1980s and 90s). ‘Project Upgrade’ (mid-1990s)

Used SPC on focused projects Project focused with full-time project leaders Only in manufacturing Not customer-focused, no measured results


A ‘chronology’……sort of……..some in parallel….


Assessment…….

CEO commitment. Timing.

When to launch? What else is going on?

Initial external benchmarking. What are you trying to accomplish?

Get on the ‘bandwagon’? ‘Stop the bleeding’? Operational improvement? Strategic improvement? Transform the culture?


CEO selects a credible leader who has / is…….

History with the company. History leading change successfully. Passionate and optimistic. Willing to stick it out, and persevere. Willing to be involved at all levels. Interacts well with executive management. Willing and able to challenge the status quo. The leader should report directly to the CEO.


CEO launches the effort to the enterprise……(DCC Jan 2001)

Presents the business case or reason. Names the leader or Director. Makes the alignment clear. Shares expectations. Continues from that day forward to….

Share the vision and passion relentlessly. Seek opportunities for involvement.

Kick off training. Project reviews. Recognition events. Leadership of Six Sigma in executive meetings.

Use the Six Sigma methodology to run the enterprise.


Leader or Director……

Refines the Six Sigma ‘vision’ for the CEO.


“Though there will always be the need for the skills and focus that come with Black Belt-led projects, we will know we have achieved success when we no longer view Six Sigma as an

‘additive’ task.

Our long term vision is that Six Sigma

becomes a key part of our Dow Corning culture,

that using the methodology becomes the way we do our work everyday.”

Six Sigma Vision

Stephanie A. Burns President and CEO

Gary E. Anderson Chairman


Leader or Director……

‘Dusts off’ change management information. Benchmarks…

Reads texts. Attends seminars. Talks to other companies’ directors and MBBs.

Develops Roles and Responsibilities for all. CEO, Sr. Champion, employee, stakeholder. Champion, process owner, project sponsor,

MBB, BB, GB, etc. Deployment leader.


Director……

Determines the Implementation Team or Six Sigma Leadership Team (SSLT).

Develops Roles and Responsibilities. Finance Specialist Communication Specialist Internal Marketing Specialist L & D Specialist IT / KM Specialist MBB Representative Deployment Leader


Director…… Gets people assigned to serve on the SSLT…...

L & D Specialist: Determines the consultant.

Training materials. Project management. Change management. Team leadership. Statistics.

Cost. Global availability / capability.

Sorts other logistics. Print and other support materials. Training venues and food.



IT / KM Specialist: Buys / builds project tracking tools. Connects ‘Analytics’ (Minitab, etc.). Knowledge management taxonomy. Works closely with the Finance Specialist

and Communications Specialist.



Financial Specialist: Benchmarks other firms. Builds the evaluation methodology. Provides initial financial training. Develops financial database.


Project evaluation methodology and reporting credibility……


Six Sigma impact categories…….

Growth Cost savings

Balance sheet impact

Non-value added (NVA) shift Cost (or loss) avoidance

Hard

Hard

Soft


Growth Cost SavingsBalance Sheet

ImpactNon-Value Add

(NVA) ShiftCost (Loss) Avoidance

Definition

Net increase in Operating Income due to increased

capacity or demand

Net difference in Operating Costs from period to period (12

months)

Net reduction in asset or increase in liability

Time spent on non-value added activity

costs

Costs that will not need to be expended

within next 12 months as a result of project

Increase capacityReduce raw material

usage or costSell Equipment

Removing work without removing

people

Eliminate need to hire new employees

Existing customer buying other products

Reduce waste disposal costs

Collect Receivables more quickly

Eliminate need to increase current expense

base

Entering new markets with existing products

Reduce headcount Reduce Inventory LevelEliminate need for capital investment

Increase capacity due to elimination of scrap

Reduce use of chemical or other supplies

Loss avoidance is true, potential lost sales

Reduce maintenance exp

Reduce utilities expense

Other Comments

Rework: capture in proper categories where specific,

identifiable financial impacts are experienced; reduce raw

material, waste disposal, supplies; remove work w/o removing people; increase

capacity, etc.

Inventory Carrying Costs: capture in proper categories

when there are specific, identifiable financial impacts

related to reducing inventory. An estimated % is not used

herein since it cannot be measured post-project.

Rates: Plant accts will document a few avg rates

per plant to be used (operators, exempt, QA).

SW&B only. We can calc hourly rates for sales

force, cust service, PE, etc as needed.


• Conservative approach to project evaluation.• All projects have a financial advisor.• Financial advisors are ad hoc project team

members.• Only financial advisors can close out a project

moving it to ‘complete’ status.

Financial Advisors



Communication (Marketing) Specialist:

Determines the ‘logo’.

Determines the ‘slogan’. Promotes Six Sigma (trinkets?). Writes or edits success stories. Positions Six Sigma in other communications.

Internally. Internet web site.

Builds a intranet web site.


Six Sigma internet page….


Click

Six Sigma intranet website…..


Six Sigma website leader messages


Six Sigma website success stories


Director…… Develops the overall implementation plan.

Timing. Cost (ensures funding before beginning). Possible benefits.


What about a Six Sigma pilot?….. Can soften the ‘landing zone’ – part of change

management. Can provide early success stories. But, can complicate implementation.

Timing Reconciliation if not controlled

If done, clearly communicate. The intent….

Gain learning and experience. Not as a ‘go’ – ‘no go’ trial.

The scope and time line.


CEO launches Six Sigma with the Executive Committee (EC)……

Shares the ‘passion’. Communicates the ‘compelling reason’ to do it. Sets expectations. Explains consequences of not adopting. Offers the first ‘taste’ of Six Sigma.

Watch for the ‘Monty Hall’ manager (‘let’s make a deal’). We’re different, we’re special, doesn’t apply here! Can we delay? We need more time / resources! We’re already doing ‘it’……

Yeh, right!


Especially at the beginning, the Director must be…..

Rigid on intent. Flexible regarding ‘uncontrollables’. A salesperson. A ‘pain’…. “We are Six Sigma, resistance is futile”. A passionate, optimistic zealot. Highly involved, role modeling in / through….

Personal GB projects. Recognition events. MBB / BB Natural Work Groups. Training activities.

Be present, on hand. Teach as appropriate.


Train the Executive Committee and their reports (3-day Champion Training) to……

Understand Six Sigma (discussion and simulation). Understand and do project selection*. Understand and do initial BB selection.

* A Critical to Quality (CTQ) parameter


CEO and Director establishes the Executive Six Sigma Leadership Team (ESSLT)……

Chaired by the CEO. All key business units present. Ensures continued growth and understanding of Six Sigma. Venue to showcase early success stories. Visibility for early Black Belts. Keeps executives involved and owning Six Sigma. Resolves key issues….

Black Belt compensation. Enterprise Six Sigma Goals and Metrics. Etc.


Director presses every Business Unit (BU) for a Six Sigma Deployment Leaders (DL)…

DLs sit on the SSLT. Part of the BU management team. Manages the ‘nuts and bolts’ within the Business

Unit….. MBB / BB staffing. Monitors the project portfolio.

Advises the Director and BU of issues.


Develop and launch a middle-level leader overview workshop…..

2-Day version of the Champion Workshop. High-level overview through discussion and simulation. Aimed at wining hearts and souls of these leaders. Director or executives teach most sessions. More than 1300 attendees to date. Very popular, highly rated.


Train Black Belts….. Training.

Body of Knowledge. Project Leadership. Change Management. Team Leadership. Statistics.

4 weeks over 4 consecutive months. Initial waves by consultants, later waves by MBBs. Recognition (Dinner, shirt, certificate, etc.).

Ongoing coaching by MBBs.


Train Black Belts…..(cont.) Certification.

Requirements. BB training. Two projects completed. Teach others. ASQ 4hr. Certification Examination. Review board.

Recognition. Dinner, watch, $$. Web announcement.


Six Sigma community stories…..


Select and train Master Black Belts (MBBs) as soon as possible…..

Use consultant trainers as BB coaches to start. Select MBBs.

Best BBs? Certified BBs? Top leaders? Determine how to get started.

Train MBBs (two weeks). Body of Knowledge.

Methodology / tools deeper dive. Statistics deeper dive. Teaching skills. Coaching skills.

Recognition (Dinner, shirt, certificate, etc.). ASAP ‘jettison’ the consultants as trainers / coaches.


Select and train Master Black Belts (MBBs) as soon as possible…..(cont.)

Certification. Requirements.

Training. Projects. Teaching / Coaching. Black Belt Certification.

Recognition.

Dinner and $$$ or something valued. Web announcement.


Institute Natural Work Groups (NWG)….. Aimed at…

Sharing best practices. Surfacing issues. Continuing learning and building skills.

Black Belt NWG – Community of Practice….. Led by local or BU MBB. Global – net meetings used. Typically monthly. Project storyboards are shared.

Master Black Belt NWG….. Training and instruction issues. Upward coaching issues. Overall deployment success.


Launch Green Belt program…… Training

3x3 DMAIC Basic Training (three days, in each of three consecutive months, project required).

Aimed at giving small-project leadership skills. Similar to BB training, but less depth. Taught by MBBs and BBs.

GB Certification Requirements

Lead two projects, serve on two BB projects, or combination.

40 question exam. Recognition

Certificate. GB shirt.


Launch Design for Six Sigma (DFSS) training……

Two-week training, over two months. Train MBBs to be trainers as soon as possible. Release consultants. Develop and launch two-day DFSS workshop for

middle-level leaders. Move DFSS into all creation processes….

New workflow design. New product design. New IT solution design. New facilities / process design.


Reconcile Six Sigma with earlier initiatives, activities, and legacy workflows…..

Management Systems Quality, safety and environmental.

E.g. ISO, TS 16949, Baldridge, EFQM, TQM,TPM (Japan)

LEAN initiatives. Workflows

Commercialization workflows (DFSS). Product design workflows (DFSS). IT project workflows (DMAIC / DFSS). Capital engineering workflows (DFSS) Manufacturing engineering workflows (DMAIC / DFSS).


Business Unit ongoing Six Sigma activities… Ongoing staff of full-time Black Belts (FTBB). Develop and maintain a healthy project portfolio. Communicate Six Sigma BU success stories. Provide BB and Team Reward and Recognition. Support the enterprise effort with…

MBBs for overall training. Executive managers for recognition and communication.

Develop Six Sigma goals, and communicate progress. FTBB staffing. Number of completed projects. Number of Certified GBs. Key roles through specific training. $$ from projects.


A word about goals and reporting…..


Six Sigma Goals

Specific Six Sigma Goals Pros – Develops commitment and accountability.

Especially when linked to bonus. Cons – Six Sigma as a “What”.

Business Goals to be delivered by Six Sigma Pros – Integrates Six Sigma into the business strategy, i.e. Six Sigma as the “How”. Cons – Slower to see results, difficulty in separating Six Sigma results.


Ongoing activities for all……. Revisit change management

(Plan, Do, Check Act - PDCA) continually.• Culture change takes time, and is culture dependent.• Use coaches, accept input / advice from all sources.

Communicate continually and relentlessly…. Use enterprise and BU Web Sites, face-to-face, etc.

Financial impact.


Six Sigma Impact Reporting

• ‘In-your-face’ monthly text report, figures to date.

• Reporting posted:

• In public folders.

• Six Sigma intranet website.

• Business Unit intranet websites.


Six Sigma Dashboards

Six Sigma Website Dashboard


Business Unit real-time Six Sigma Dashboards…….


Ongoing activities for all……. Communicate continually and relentlessly….

By, enterprise and BU websites, face-to-face, etc. Success stories. Messages from leaders. Six Sigma community achievement (certification).

Monthly updates. Promotional activities. Gallery Walks.


Six Sigma Gallery Walks


Ongoing activities for all…….(cont.) Visits by executive management and Director with /

for…. BBs / GBs. Site and area leaders. Project and portfolio reviews.

Benchmark with other companies. Yearly assessment of implementation progress and

shortfalls.


Current issues…….

Ongoing BB and MBB staffing (loss to new roles, hiring freeze).

Uptake in Governance (Finance, Legal, etc.) has been slow.

Uptake in some parts of the world has been slow. Need more aggressive application of DFSS in

creation activities. Further work on Business Process Management to

sustain the gains.


‘I wish we would have……’ Pursued change management / stakeholder analysis

more aggressively early on. Had more time with the Executive Committee

separately to…. Agree on goals. Understand….

Six Sigma. Enormity and duration of the task. Similarities / differences from previous efforts. How it would be implemented. How it will HELP them achieve their goals.

Had the EC members co-teach their direct reports. Put MBBs in place earlier to coach BBs.


‘I wish we would have……’ (cont.) Had less ‘competition’ from other enterprise initiatives

/ activities at the beginning. Spent more time on Six Sigma at Mergers and

Acquisitions. Spent more time at non-USA locations.


Things we are proud of…that worked well…

Recognition of MBBs and BBs. Certification programs. Quality and skill of our MBBs and BBs. 2-day DMAIC Workshop for Middle-level Leaders. Selection of the consultant, and the quality of the

service and materials provided. Use of Six Sigma (KPI, SIGs, etc.) at the highest level

of enterprise and business unit planning. Project tracking system and impact reporting.


Click


GRS Search – Shanghai / Songjiang (23 Nov 04)


Things we are proud of…that worked well…

Progress reporting through dashboards.

Six Sigma Communications and Websites at the enterprise and business unit levels.


Business Unit Six Sigma websites


Things we are proud of…that worked well… Changing culture and level of engagement. Employee engagement…

~ 7000 training events. ~ 4900 project team members.

Solving long-standing Internal problems Problems serving our customers

Bottom line results!

~ 20 x ROI


Things we are proud of…that worked well… Increased customer satisfaction. Increased enterprise profitability. And finally, after four years….

is STILL HERE!


Summary…..take-aways….must haves….

Top-level commitment and involvement. Capable deployment leadership. Continual benchmarking. Relentless communications. Credible financial impact. Healthy project portfolios. Business Unit ownership. Full-time Black Belts and Master Black Belts. Ongoing, effective learning and development. Perseverance, hard work and optimism.


“A company doing Six Sigma”

“A Six Sigma company”



Future activities are clear….

Incorporate LEAN principles and tools with the Six Sigma.

Expanded the use of DFSS. Fully use business process management to sustain

our gains. Relentlessly and continually communicate.

future!


We are innovative leadersunleashing the power of silicon to benefit everyone, everywhere.


Questions ?Questions ?


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