6 – Sigma Training

Review

Outline

Topic 1 - Six Sigma OverviewTopic 2 – Team process and logisticsTopic 3 – Intro to Project CharterTopic 4 – Project Charter ContinuedTopic 5 – Think MeasurementTopic 6 – Pre-Project Planning - WBSTopic 7 – Data Analysis

Topic 1 - Six Sigma Overview

What is Six Sigma?

• In statistics, sigma (s) refers to “standard deviation” which is a measure of variation.

• You will come to learn that variation is the enemy of any quality process.

• We need to understand, manage and minimize process variation.

• Six Sigma is actually an aspiration or goal of process performance.

• A Six Sigma process only yields 3.4 defects for every million opportunities! In other words, 99.9997% of the products are defect-free!

Six Sigma Levels

Six Sigma Levels

• Higher sigma level means lower defect rate. Let’s take a look at the defect rates of processes at different sigma levels.

• A 3 Sigma processes has a defect rate of approximately 7%. What would happen if processes operate at 3 sigma?• Virtually no modern computer would function*.• 10,800,000 health care claims would be mishandled each year.• 18,900 US Savings bonds would be lost every month.• 54,000 checks would be lost each night by a single large bank.• 4,050 invoices would be sent out incorrectly each month by a modest-sized telecommunications company.• 540,000 erroneous call details would be recorded each day from a regional telecommunications company.• 270,000,000 (270 million) erroneous credit card transactions would be recorded each year in the United States.

• Sigma level is the measure - Six is the goal!

Six Sigma - Fundamentally

Fundamentally….

Six Sigma is a set of techniques and tools for process improvement.

Six Sigma seeks to improve the quality of process outputs by identifying and removing the causes of defects (errors)

Six Sigma tries to focus improvements from a customer’s need perspective.

Customer is someone, group or process who receives an output. Customers can be both internal and external.

Six Sigma incorporates measurements (statistics) as a way to both identify areas to work on and results of improvement efforts.

Six Sigma Approach

Y=f(x) is the relational transfer function that is used by all Six Sigma practitioners. 

Y refers to the measure or output of a process.• The “Y” is the measure of process performance

that you're trying to improve. 

f(x) means “function of x”.• x’s are factors or inputs that affect the “Y”

In simple terms: “My process performance is dependent on certain x’s”.

Y=f(x) Approach

Y=f(x)

X8

X6

X1

X5X7

X3X2

D-M-A-I-C

Define• Define and quantify

the Problem & Objective

Measure• Baseline process, validate

measures & Identify all possible x’s and dependent y’s

Analyze • Analyze & Validate Causes identifying critical factors

Improve • Develop Solutions

Control• Implement &

sustain solutions

Expectations from You

Develop Skills• Gain insight into tools and techniques that can help

you do your jobs more effectively.• Develop a “Problem-Solving” toolbox.

Develop Process and Customer-centric Approach to Problem-Solving• Understanding dependencies of tasks and processes• Solving the Customer’s problem completely• Use a consistent and disciplined approach on projects

Work more collaboratively• Work with each other, both internal to TS and the rest

of the College, solving complex, cross-functional issues.

VOC – Review

• VOC stands for Voice of the Customer.• The 4 primary forms are...

• VOC: Voice of the Customer• VOB: Voice of the Business• VOA: Voice of the Associate• VOP: Voice of the Process

• VOC is gathered via • Direct Methods• Indirect Methods

• Discussion point • How did you gather your Pain point?

D-M-A-I-C

Define• Define and

quantify the Problem & Objective

Measure• Baseline process, validate

measures & Identify all possible x’s and dependent y’s

Analyze • Analyze & Validate Causes identifying critical factors

Improve• Develo

p Solutions

Control• Implement

& sustain solutions

Lets spend the day here- Define f(x)’s - Affinity modeling - Process mapping

• P4ME – Affinity Categories• People: People who are involved in the

process;• Methods: How the process is completed

(e.g. procedures, policies, regulations, laws);

• Machines: Equipment or tools needed to perform the process;

• Materials: Raw materials or information needed to do the job;

• Measurements: Data collected from the process for inspection or evaluation;

• Environment: Surroundings of the process (e.g. location, time, culture)

P4ME Affinity Model

Y=f(x)

ME

MM

PM

Team Identification

• Self-awareness is key• Understanding yourself helps you explain who you are

and how you work

• Key to comprehending team dynamics • Understanding your team members helps you better

interact with them and understand their motivations, perspective, needs and wants

• Personality is only one basis of guiding interaction, not the only basis

• No one is black or white – everyone is nuanced

• Practical applications for forming teams

Project Charter

The purpose of the project charter is to get the project approved

Secure a Sponsor High level timeline agreement ROI agreement High level deliverable agreement Setting expectations

Lets Spend 20 Minutes putting a first draft of our charters together

See template

Pareto Principle• The Pareto Principle is commonly known as the “law of the vital few” or

“80:20 rule”.

• It means that the majority (approximately 80%) of effects come from a few (approximately 20%) of the causes.

• Example of applying Pareto Principle:• 80% of the defects of a process come from 20% of the causes.• 80% of sales come from 20% of customers.

• Since this 80:20 rule was originally based upon the works of Wilfried Fritz Pareto (aka. Vilfredo Pareto), the Pareto principle and references to it should be capitalized because Pareto refers to a person (proper noun).• Mr. Pareto is also credited for many works associated with the 80:20 some more

loosely than others:• Pareto’s Law• Pareto efficiency• Pareto distribution etc.

What is FMEA?

• FMEA (Failure Modes & Effects Analysis) is an analysis technique to identify, evaluate and prioritize a potential deficiency in a process so that the project team can design action plans to reduce the probability of the failure/deficiency occurring.

• FMEA activity follows the process mapping and is followed by a Pareto Analysis.

• FMEA is completed in cross-functional brainstorming sessions in which attendees have a good understanding of the entire process or a segment of it.

• There are seven (7) common forms of waste that are often referred to as the Seven Deadly Muda.

• Technically there are more than seven forms of waste but if you can remember these seven you'll capture 90+% of your waste.1. Defects2. Over Production3. Over Processing4. Inventory5. Motion6. Transportation7. Waiting

Cost of Poor Quality

Six Sigma Metrics

• There are many Six Sigma metrics and/or measures of performance used by Six Sigma practitioners.

• In addition to the ones we’ll cover here, several others (Sigma level, Cp, Cpk, Pp, Ppk, takt time, cycle time, utilization etc.) will be covered in other modules throughout this training.

• The Six Sigma metrics of interest here in the Define Phase are:• Defects per Unit (DPU)• Defects per Million Opportunities (DPMO)• Yield (Y)• Rolled Throughput Yield (RTY)

What is SIPOC?

• SIPOC (Suppliers-Input-Process-Output-Customers) is a high-level visualization tool to help identify and link the different components in the process.

• It is usually applied in the Measure phase in order to better understand the current state of the process and define the scope of the project.

Activities

Element of project work that requires an action to produce a deliverable. Have an expected duration. Consume budget and/or human resources. Are named in verb-noun format.

Example: Activities in a company project. Revise user manual. Make a sales presentation. Reserve conference room.

Verb (Action)Verb (Action) Noun (Deliverable)Noun (Deliverable)

Revise user manualExpected duration determined by (whatever)

Work Package

Planned work or deliverables. Lowest-level component of the work breakdown structure. Cost and schedule can be easily estimated.

A work breakdown structure showing the work packages

The 8/80 Rule

A general guideline regarding work packages: they require more than 8, but fewer than 80, hours of effort to complete.

Helps project managers create work package lists.

The Sequence Activities Process

A planning process that involves identifying and documenting interactivity dependencies among project activities for the purpose of creating the project schedule.

Types of Activity Dependencies

Dependency Description

Mandatory Inherent to the work itself and are usually affected by physical constraints.

Discretionary Defined by the project and project management team at their discretion.

External Contingent on inputs from outside the project activities.

Precedence Relationship Types

Relationship Description

Finish-to-Start (FS) Activity A must finish before activity B can start.

Finish-to-Finish (FF) Activity A must finish before activity B can finish.

Start-to-Start (SS) Activity A must start before activity B can start.

Start-to-Finish (SF) Activity A must start before activity B can finish.

The Critical Path Path with the longest total duration. Has no scheduling flexibility.

1[6W] + 2[4W] + 4[3w] + 6[1W] = 14 Weeks1[6W] + 3[5W] + 5[4w] + 6[1W] = 16 Weeks Critical Path

A network diagram showing the critical path of activities

Schedule Compression

• The shortening of the project schedule without affecting the project scope.

• Two methods:• Fast-tracking• Crashing

Example: Schedule compression for building and installing cabinets.

• Involves carpenter and sub-contractor.• Sub-contractor installs cabinets while carpenter builds.• Changes precedence.

How do you collect and analyze data?

1. Implement the observational system you’ve planned.

2. Organize the data you’ve collected.

3. Conduct data graphing, visual inspection, statistical analysis, or other operations on the data as appropriate.

4. Take note of any significant or interesting results.

5. Interpret the results.

What is Sampling

• Sampling is the process of selecting objects or observations from a population of interest about which we wish to make statistical inference.

• It is extensively used to collect information about a population which can be physical or intangible objects.

SamplingPopulation Sample

Basic Sampling Steps

• Determine the population of interest• Determine the sampling frame• Determine the sampling strategy• Calculate the sample size• Conduct sampling

What is SPC

• Statistical process control (SPC) is a statistical method to monitor the performance of a process using control charts in order to keep the process in statistical control.

• Statistical process control can be used to distinguish between the special cause variation and the common cause variation in the process.

• It presents the voice of the process.

What is Measurement System Analysis

• Measurement System Analysis (MSA) is a systematic method to identify and analyze the variation components in the measurement.

• It is a mandatory step in Six Sigma project to ensure the data are reliable and trustworthy before making any data-based decisions.

• It is the check point of data quality before we start any further analysis and draw any conclusions from the data.

Accuracy vs. Precision

• Accuracy• The level of closeness between the average observed value and

the true value• How well the observed value reflects the true value

• Precision • The spread of measurement values• How consistent the repeated measurements deliver the same

values under the same circumstances