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Treasure Chest
of Six Sigma
Growth Methods,
Tools, and Best
Practices
A Desk Reference Book for
Innovation and Growth
Lynne Hambleton
PRENTICE HALL
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ptg6842824 for errors or omissions. No liability is assumed for incidental or consequential
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Library of Congress Cataloging-in-Publication Data:
Hambleton, Lynne.
Treasure chest of six sigma growth methods, tools & best practices : a desk reference book for innovation and growth / Lynne Hambleton.
p. cm.
Includes bibliographical references and index.
ISBN 978-0-13-230021-6 (pbk. : alk. paper) 1. Six sigma (Quality control standard) 2. Strategic planning. 3. Business planning. 4. Management. I. Title.
HD62.15.H354 2008 658.4’013—dc22
2007016916 Copyright © 2008 Pearson Education, Inc.
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10-Digit ISBN 0-132-30021-4 13-Digit ISBN 978-0-132-30021-6
Text printed in the United States on recycled paper at R.R. Donneley & Sons in Crawfordsville, Indiana. First printing, July 2007
Editor in Chief Karen Gettman Acquisitions Editor Bernard Goodwin Editorial Assistant Michelle Housley Development Editor George E. Nedeff Marketing Manager Curt Johnson Publicist Andrea Bledsoe Cover Designer Louisa Adair Managing Editor Gina Kanouse Copy Editor Language Logistics, LLC Graphic Artist Laura Robbins Senior Indexer Cheryl Lenser Compositor Eric S. Miller Manufacturing Buyer Dan Uhrig
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I dedicate this book first and foremost to my loving husband, Bill, and our
two wonderful sons, Corbin and Garrett. I also dedicate this book to Skip
and Kathy Creveling, whose friendship and support are invaluable gifts;
and to Janet Nelson, a fellow consultant and CSSBB, who is courageously
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Preface ...xv
Introduction Different Methods for Different Purposes...1
Part I
Six Sigma Methodology Overview: Choosing the Right
Approach to Address the Requirements
Section 1 Define-Measure-Analyze-Improve-Control (DMAIC)....13Section 2 Lean and Lean Six Sigma ...29
Section 3 Design for Six Sigma (DFSS) ...45
Section 4 Six Sigma for Marketing (SSFM) ...67
Part II
Six Sigma Tools and Techniques: Choosing the Right
Tool to Answer the Right Question at the Right Time
The Six Sigma Encyclopedia of Business Tools and Techniques ...115Summary Tool Matrix ...115
A Activity Network Diagram (AND) - 7M Tool . . . 127
Affinity Diagram - 7M Tool...136
Analysis of Variance (ANOVA)...142
Arrow Diagram...159
B Benchmarking ...160
Box Plots—Graphical Tool ...165
Brainstorming Technique ...168
C Capability Analysis ...173
Cause-and-Effect Diagram - 7QC Tool ...173
Cause-and-Effect Prioritization Matrix ...188
Cause and Prevention Diagram ...198
Checklists - 7QC Tool...204
Conjoint Analysis ...207
Control Charts - 7QC Tool...217
Cost/Benefit Analysis...238
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Critical Path Method (CPM) ...242
Critical-to-Quality (CTQ) ...242
D Data Collection Matrix...248
Design of Experiment (DOE) ...250
Dotplot ...280
F Failure Modes and Effects Analysis (FMEA)...287
5-Whys ...305
Fault Tree Analysis (FTA) ...309
Fishbone Diagram - 7QC Tool ...316
Flowchart - 7QC Tool ...316
G Gantt Chart...317
GOSPA (Goals, Objectives, Strategies, Plans and Actions)...320
Graphical Methods...323
H Histogram - 7QC Tool ...330
House of Quality (HOQ) ...335
Hypothesis Testing ...335
I Interrelationship Diagram - 7M Tool ...369
K KJ Analysis ...375
M Market Perceived Quality Profile (MPQP) ...390
Matrix Diagrams - 7M Tool ...399
Measurement System Analysis (MSA)...412
Monte Carlo Simulation ...431
Multi-vari Chart...439
N Normal Probability Plot ...444
P Pareto Chart - 7QC Tool...445
PERT (Program Evaluation and Review Technique) Chart ....453
Poka-Yoke ...462
Porter’s 5 Forces ...464
Prioritization Matrices - 7M Tool ...470
Process Capability Analysis ...486
Process Decision Program Charts (PDPC) - 7M Tool ...515
Process Map (or Flowchart) - 7QC Tool ...522
Pugh Concept Evaluation and Selection...534
ptg6842824 R RACI Matrix (Responsible, Accountable, Consulted,
Informed)...554
Real-Win-Worth (RWW) Analysis...560
Regression Analysis ...571
Risk Mitigation Plan...601
Rolled Throughput Yield...610
Run Chart - 7QC Tool...611
S 7M - Seven Management Tool ...615
7QC - Seven Quality Control Tool...616
Sampling ...618
Scatter Diagram - 7QC Tool ...640
Scorecards ...653
SIPOC (Supplier-Input-Process-Output-Customer)...663
SMART Problem & Goal Statements for a Project Charter ...665
Solution Selection Matrix ...672
Stakeholder Analysis ...681
Statistical Tools...684
Stratification - 7QC Tool ...697
SWOT (Strengths-Weaknesses-Opportunities-Threats)...699
T Tree Diagram - 7M Tool ...712
TRIZ...715
V Value Stream Analysis ...727
Voice of Customer Gathering Techniques...737
W Work Breakdown Structure (WBS) ...753
Y Y = f (X) ...758
Part III
Best Practices Articles
The Anatomy of Quality Loss in a Product ...763The Anatomy of Variations in Product Performance ...777
Benchmarking—Avoid Arrogance and Lethargy ...789
Building Strength via Communities of Practice and Project Management...799
Complex Organizational Change Through Discovery-based Learning ...827
Lean Six Sigma for Fast Track Commercialization High Risk-High Reward, Rapid Commercialization: PROCEED WITH CAUTION! ...835
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Listening to the Customer First-Hand; Engineers Too ... 851
The Practice of Designing Relationships...873
A Process for Product Development...887
Selecting Project Portfolios using Monte Carlo Simulation and Optimization ...921
Part IV
Appendixes
Appendix A Statistical Distribution Tables...939Appendix B Glossary...951
Appendix C References ...979
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Acknowledgments
Thank you to my friends and professional colleagues who contributed to this book. They took precious time out of their hectic schedules to share the wisdom they have gained through their business experiences. Some contributed inadvertently by brainstorming concepts with me, namely Dan Rose, Joe Szostek, and Chris Tsai. Thank you to the peer reviewers for reading the early drafts to test for understanding. This invaluable manuscript input came from colleagues such as Eric Maass and Scott Wise. Other colleagues authored Best Practices articles, featured in Part III (listed alphabetically):
• Thank you to Donna Burnette and David Hutchens, for agreeing to share some of their professional insights on the critical components of learning that have earned them firm national recognition. Their article on discover-based learning programs adds an invaluable per-spective on how best to digest and utilize new knowledge and skills. This approach transforms otherwise dry, dense content into a fun and memorable experience.
• Thank you to Mike Cook, whose witty, provocative article on the
importance of collaboration and designing relationships adds color and
refreshing change of pace to this book and reminds us of the impor-tant human element involved in the work.
• Thank you to Clyde (“Skip”) Creveling for not only sharing his creativity and thought-leadership in writing an article on how to “fast track” a prod-uct development process, but also his unending professional support and guidance.
• Thank you to both Larry Goldman and Karl Luce for sharing best prac-ticesexperienceon project selection and the portfolio management process using Monte Carlo simulation and optimization techniques. Their insights help give a competitive advantage to any reader.
• Thank you to Bill Jewett for his sage and practical approach to writing not one, but four articles. His depth and breadth of experience as a practi-tioner, manager, and consultant were shared in two articles about robust
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design—specifically on quality loss and on performance variation. In addi-tion, the best practices of collecting and leveraging the Voice of the Cus-tomer article, as well as a benchmark product commercialization process article round out an engineering snapshot of product development for a non-technical business person.
• Thank you to Sy Zivan, one of the benchmarking pioneers in the 1980s from Xerox Corporation, for sharing his knowledge on the best
practices of the benchmarking process. His article reflects his latest
thinking on how benchmarking has evolved over the years. Thank you to each of these professionals and any others I inadvertently have missed mentioning for adding your unique and invaluable perspec-tives, all of which enhanced this book.
Thank you to my family and friends who put up with me during the writing process. Those who wove a supportive, energizing network around me include L. Berkowitz, K. Creveling, D. Croessmann, L. Judson, L. Markt, M. McCandless, and especially my husband, W. Magee.
Most importantly, thank you also to the professionals at Prentice Hall for their support and hard work to make this book a reality—Heather Fox, publicist; Bernard Goodwin, editor; Michelle Housley, editorial assistant; and George Nedeff, development editor (listed alphabetically).
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About the Author
Lynne Hambletonis a business consultant with special focus on strategy development and execution and change management to improve opera-tional processes and expand commercial opportunities. She has held sev-eral management positions in Xerox Corporation where she worked for almost 25 years. She also has worked in education, healthcare, and energy public sectors and start-ups. Hambleton’s experience spans general man-agement, marketing, field operations, strategic planning, alliance devel-opment, and sales/channel management. She also has served as an adjunct professor of strategic planning at Rochester Institute of Technol-ogy’s School of Business.
Ms. Hambleton received a Master’s degree in Business Administration, with an emphasis in industrial marketing; a Master’s degree in Adult & Higher Education/Organizational Development; and a Bachelor of Sci-ence degree in psychophysiology, all from University of North Carolina— Chapel Hill. Ms. Hambleton is also an active PMI-certified Project
Management Professional (PMP) (1998); a Master Black Belt; and Certi-fied Six Sigma Black Belt (CSSBB) from Villanova University (2006). Hambleton’s additional publications include Six Sigma for Marketing
Processes, An Overview for Marketing Executives, Leaders, and Managers
(co-authors C.M. Creveling and B. McCarthy), Prentice Hall, 2006; the chap-ter titled, “Supporting a Metamorphosis through Communities of
Practice,” in Leading Knowledge Management and Learning, by Dede Bonner, 2000; and the article, “How Does a Company the Size of Xerox Design a Curriculum in Project Management for the Entire Organization?” printed in In Search of Excellence in Project Management, Volume 2, by Harold Kerzner, 1999. Ms. Hambleton lives in Rochester, New York, and can be reached best via email at [email protected] or visiting www.mageemanagement.com.
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Preface
The Treasure Chest is part of Prentice-Hall’s Six Sigma for Innovation and
Growth Series. This book serves as a consolidated “how to” reference book
of Lean Six Sigma, covers growth and innovation tools, provides an overview of methods and the tools to which they align, and offers an overview of additional best practices used to manage a successful Six Sigma growth initiative. The Treasure Chest of Six Sigma Growth Methods,
Tools, and Best Practices guides you in selecting the right tool to answer the right question at the right time. The right question drives the requirement or
need to be addressed—regardless whether the requirement comes from your customer or a business need. Understanding the overall objective, or requirement, helps determine which Six Sigma methodology to use. The
right time dictates what else you know given where you are in your
approach. Understanding whether you are in the planning, designing, implementing, or maintaining phases of an overall process determines which process step, thereby the context of the question being asked. Finally, the right tool should be the last question asked, as it is based on first knowing what is required and at what point you are in the process.
The Treasure Chest is a desk-reference book for people interested in growth, operations excellence, and business-process improvement. This book speaks to the general business practitioner, business analyst, man-ager, and leader, regardless of the business context. It is for profit or non-profit enterprises; large or small firms; whether in headquarters-function, plant, or field location, regardless of functional discipline.
The book covers a range of applications from strategic planning aspects of business (offering portfolio renewal) to presenting development and launch preparation, from post-launch operations management to offering discontinuance. Whether contributing a new design (product and/or service), proposing a new process, evaluating a portfolio of offerings, or managing a current portfolio of offerings, this book compiles the
resources that help drive growth proactively and presents them in a quick-reference format for easy navigation. This book takes the hassle out of researching the methodology and tools so you can immediately begin to find solutions for your discipline.
The Treasure Chest speaks primarily to business people who need practical “hands-on” guidance and answers to the following questions:
ptg6842824 1. How do you select the appropriate tool based on the business need
(or question being asked) and the required deliverables? 2. How do you use the tool, what inputs or data are required, and
what comprises a step-by-step procedure for each tool or technique? 3. How do you analyze the tool’s output and decide on the next course
of action?
This book was specifically written for general business disciplines, such as marketing, strategic planning, pricing, finance, customer administra-tion, sales, services, support, maintenance, and parts and supplies distri-bution. This book also is targeted to the technical engineering and research community searching for candidate tools that support commu-nication, project management, risk mitigation planning, and change management requirements.
Common Language
Communication presents a challenge when a collaborative team speaks a different language, different filter, different perspective, different interpre-tation. Successful innovation and growth rely on the integration and collab-oration of multiple disciplines, often represented in a cross-functional team. Such teams may be comprised of internal, functionally distinct profession-als or any combination of external partners, clients, and sometimes even competition. Regardless if the goal requires creating something from scratch or fine-tuning the management of current offerings, the combina-tion of multiple disciplines, capabilities, and perspectives greatly enhance the end results of this work. However, this collaborative work requires a common language to understand and integrate the diversity.
The methods and tools presented in this book assist with interpretation of different perspectives and provide a common platform, foundation, and language from which multiple views can work in harmony. Interestingly,
each discipline has its own unique language, different thought-processes, and/or different tools that characterizes its work. Sometimes, perhaps with minor
adaptations, a tool considered commonplace by one discipline can be viewed as an “a-ha” eureka discovery to a second group when properly applied. Tools commonly used by marketing groups can excite a technical team if introduced at the appropriate time. For example, a communication summary tool or prioritization tool may be overlooked because it is a “soft tool,” but it actually can fit perfectly when communicating “big picture” thinking. Similarly, if the time is right, marketing teams enjoy the rigor of techniques from the technical counterparts to provide a fresh perspective.
Treasure Chest embraces tools used by both the technical and
non-techni-cal communities and describes when and how to use them. It contains the business tools and methods for innovation and growth to facilitate best practices sharing and a “common language” across multi-disciplined teams. It also integrates some key technical tools appropriate for general business use (or understanding).
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I n t r o d u c t i o n
Different Methods for Different
Purposes
The Evolution of Six Sigma
Six Sigma (or “Lean Six Sigma,” as some refer to it) evolved into a rich set of different standardized methods, tools, and best practices. Six Sigma started as a problem-solving approach to reduce variation in a product and manufacturing environment. That application has expanded to process improvement and other areas of the business, including product or process redesign, research, and technology design, offering portfolio renewal, product development, and post-launch operations management. Six Sigma application stretches beyond the manufacturing enterprises into the services industry and non-profit organizations. Regardless of the application, businesses search for simplicity without jeopardizing the need for robust data. Six Sigma offers a set of methods and tools from which to choose. Six Sigma methods build from a common core founda-tion yet allow flexibility to adapt to changing environment needs. Part of the flexibility stems from a plethora of candidate tools available, depend-ing on the situation. The tool library ranges from rigorous statistical and quantitative tools to “soft” qualitative ones. The purpose of this book is to help in selecting the most appropriate method and the most appropriate tool within the suite of available candidate tools.
Common Approach to Leverage Everyone’s Contribution,
Regardless of Business Model
A method establishes the foundation for how work gets accomplished. It defines the who, what, when, where, why, and how of a process; wherein a process describes a series of logically sequenced tasks to complete work. It answers the questions such as, “what gets done;” “who does the work;”
ptg6842824 “when the work starts and stops;” “where the work is done;” “why the
work is being done;” and “how the work is to be completed.” A well-deployed method orchestrates and integrates the people working in a process in an efficient and effective (streamlined) set of activities. It organizes the work as defined by a set of customer requirements. The work produces the agreed-to deliverables according to their “acceptance” criteria. A well-constructed method defines a set of tasks that circumvent redundancies and gaps. Activities done beyond the prescribed work to produce the required deliverables arguably could be called unnecessary or a “waste.” A method defines which tool best supports a task and will produce the desired results, providing a common language of terms and tools and a common way of working for those involved in the process.
Overview of Six Sigma Method
The methods used in Six Sigma (including Lean Six Sigma) contain sev-eral common principles, such as data-driven decision-making and project management fundamentals. Part I, “Six Sigma Methodology Overview— Choosing the Right Approach to Address the Requirements,” uses these principles to organize its content.
Tool-Task-Deliverables Linkage
Six Sigma methods represent a structured thought process that starts with thoroughly understanding the requirements (or key business questions) before proceeding. The requirements, in turn, define the deliverables to be produced and the tasks needed to produce those deliverables and, last, the supporting tools to be used to complete the tasks and produce the deliverables. This structure is often called the Tools-Tasks-Deliverables com-bination to indicate the interdependencies. The Tools-Tasks-Deliverables linkage is executed in “reverse” or from right-to-left, starting with Deliv-erables. Hence, a tool is selected only after the requirements, deliverables, and tasks are well understood to ensure that the appropriate tool is used for a given task and to avoid the “rut” of treating everything as if it were a nail when the only tool you use is a hammer. The various Six Sigma methods suggest a variety of applicable tools to choose from, but rarely does a given project require the utilization of every tool. No tool fits every situation. Determining which tool fits best depends on the situation. Thus, tool selection is done only after the requirements, resulting deliver-ables, and tasks are completely understood. [Part II of this book provides not only an inventory of potential tools, but also information on how to apply and interpret results to help you in tool selection.] Remember: Use the right tool at the right time to help ask and answer the right ques-tions.
ptg6842824 Result-metrics
The result-metrics focus is a distinguishing principle of Six Sigma meth-ods. These fact-based metrics determine whether (internal or external) customer requirements are achieved. Performance typically is evaluated via a statistical metric of the process or offering (e.g. product, services, or information).
High-level process and performance metrics define what critical-to-quality is and encompass the critical parameters necessary to meet requirements. Eventually, these metrics should be translated into a lan-guage that is “meaningful” to a process worker involved in providing either the inputs or process deliverables (outputs). Depending on the requirements, the result-metrics may be “hard” or “soft” measurements— quantitative or qualitative; continuous or attribute data. A good litmus test for translated critical-to-quality metrics is whether a “new hire” understands clearly what is expected of him/her to meet requirements with no “fuzzy” or nebulous evaluation of what characterizes “good” or “poor” performance.
Process-centric
Another principle employs a process-centric view. Understanding how inputs to a process are integrated and how value is added to a product, information, or services offering is as important as what is being added. Understanding the combination of what and how inputs and other key variables come together to produce the final outputs (or deliverables) enables a more accurate forecast of whether customer requirements (or targets) will be satisfied. Prior “results” alone are poor predictors of future outcomes, and without knowledge of the process, any forecast is blinded; any successful forecast would be by chance. Because business prefers accurate forecasts of performance, a process-centric view becomes an integral ingredient.
Adaptive and Iterative
Methods used in Six Sigma are adaptive and iterative. Adaptive implies the fact that it can be tailored to a variety of situations and business contexts. Moreover, any given Six Sigma method can be integrated with another process or methodology as an underpinning to identify, gather, analyze, and report on critical parameters in a proactive or reactive manner. For example, if your firm has an existing standard product development process or customer account selling approach, Six Sigma can supplement it and make it more robust. The adaptive nature of these methods also speaks to the wide array of industries and situations in which they can be applied. The breadth of industries includes military, government, auto-motive, aerospace, high-tech, manufacturing, office products, financial
ptg6842824 services, e-commerce, logistics and supply chain, healthcare, and
pharma-ceutical industries. Within companies, multiple disciplines have
embraced Lean Six Sigma: manufacturing, engineering, finance, adminis-tration, customer operations, maintenance, services deployment, and marketing and sales. The approach can even be applied to personal and social situations. Of the Top 100 companies in the 2005 Fortune 500 list, 70 of them have been in the top 100 for five or more years. Interestingly, of those 70 companies, 63% of them publicly acknowledge implementing Six Sigma to some degree. Through further analysis, we have found that these same 44 Six Sigma users also reported 49% higher profits (com-pounded annually) on average than their peers.
The iterative nature of the Six Sigma methods stems from the fact that more information on a variable or potential root cause gets revealed as the project progresses. Hence, one path of inquiry based on one assump-tion may prove to be a dead-end or altered, as more data on the current state becomes known. Although Six Sigma methods use a project-struc-ture with phase-gates, a fundamental principle across the various approaches encourages informed updates to prior step deliverables, as appropriate, and promotes proper communication. Use the best informa-tion available at the time but continue to ask quesinforma-tions and keep an open mind. Six Sigma projects involve a discovery process wherein an individ-ual serves as a “sleuth,” investigating, exploring, hypothesizing, and test-ing assumptions.
Data-driven Decision-making
Given the uncertain nature of projects, when seeking facts that answer key business questions, revisions to earlier project work reflect the evolving discovery of fact-based results. For example, a business operations review may focus on a set of key metrics to manage a process. If a chronically missed target evokes a Six Sigma project, an interim project deliverable could identify that some of the metrics associated with the key variables driving the desired business outcomes are missing, hence the “dashboard” requirements become refined to reflect the vital few parameters, com-prised of both leading and lagging metrics. Next, the project could focus on establishing baseline data for the “new” critical metrics to re-evaluate performance and better understand any cause-and-effect relationship(s).
Project-based Methods
As previously referenced, Six Sigma methods tend to use a project structure. A project structure has a distinct beginning and end to the work performed. The requirements phase determines the boundaries of this definitive time-frame. A project team, with defined roles, forms only for the duration of the project’s timeframe. A project structure adds the rigor of requiring
ptg6842824 meeting with the project and key stakeholders) before exiting a given
phase-gate or step and starting another one. Project structure borrows heavily from the project management discipline and its nine knowledge areas to manage the lifecycle of the project: scope, time, budget/cost, risk, quality, communications, human resources, procurement, and integration.
The project context of Six Sigma methods incorporates a rather short-term perspective (averaging a three, six, or twelve-month project scope). A project may involve an improvement or enhancement to something [often focused on reducing defects, minimizing variance from a target, or improving velocity (speed)], clean-sheet innovation, or design and cre-ation (such as product or services development or portfolio assessment). The technical community (for example, engineering or manufacturing) has embraced a category of Six Sigma methods called Design for Six Sigma (DFSS). A newly emerging field is Six Sigma for Marketing (SSFM). SSFM may be a misnomer, because the various methods apply to the remaining (“non-engineering”) business disciplines, such as marketing, sales, strategic planning, services, and customer operations. Examples of project-based methods include
• DMAIC (Define-Measure-Analyze-Improve-Control, and its variants DMAIIC (with “II” representing Improve-Innovate) and Lean Six Sigma)
• Lean (and its variants PDCA Do-Check-Act) / PDSA (Plan-Do-Study-Act) and Lean Six Sigma)
• DFSS category with DMADV (Define-Measure-Analyze-Design-Verify), CDOV (Concept-Design-Optimize-Verify) (and their variants DMEDI (Define-Measure-Explore-Develop-Implement), PIDOV (Plan-Identify-Design-Optimize-Validate), ICOV (Identify-Characterize-Optimize-Verify), and IIDOV (Invent-Innovate-Develop-Optimize-Verify))
• SSFM category with UAPL (Understand-Analyze-Plan-Launch) and (sometimes) IDEA (Identify-Define-Evaluate-Activate)
Operational-based Methods
Managing an ongoing operation, however, is emerging as a new applica-tion area. Hence, the applicaapplica-tion of the Six Sigma method and tools to an operational process may last for years, rather than months as with a short-term project. The objective of operational-based Six Sigma is to manage or sustain an improvement of a launched product and/or serv-ices offering, for example, or to adapt and respond to environmental changes. This operational focus of Six Sigma is being applied to business areas such as customer operations (for sales, services, support, adminis-tration, financing, and related business disciplines) and strategic
ptg6842824 planning (for offerings portfolio management). Some might argue that
portfolio management can be handled as a project defined by an annual planning cycle, but others view it as an ongoing area.
Nonetheless, Six Sigma discipline has added a competitive advantage to those firms that have begun to apply its method and tools to this process area. The operations-based methods currently fall within the SSFM (Six Sigma for Marketing) category with LMAD (Launch-Manage-Adapt-Discontinue, for customer operations) and sometimes IDEA (Identify-Define-Evaluate-Activate, for strategic planning), which can be considered operational given that the management and revitalization process of a firm’s offerings portfolio is cyclical and can span multiple years.
How Do the Various Six Sigma Methods Fit Together?
In summary, this Introduction overviews the major Six Sigma approaches being used currently. Each Six Sigma method has a valid purpose in today’s business world, the selection of which approach best fits a need depends on the key business question being asked at the time. They all fit together and inform one another. The integrated view is as follows:
An enterprise’s strategic platform defines its business and offerings, so typically a process flow starts with the business strategy process of port-folio definition and renewal (IDEA — Identify-Define-Evaluate-Activate).
From there, funding gets earmarked for research, tactical, and opera-tional activities. Research and Technical Development (R&TD) efforts are funded to develop forward-looking capabilities that eventually feed product development and commercialization. The approach used to guide Research’s activities is called I2DOV
(Invent-Innovate-Develop-Optimize-Verify).
The specific offering’s design, development, and commercialization efforts split into two branches: 1) the technical team that uses CDOV (Concept-Design-Optimize-Verify) to guide its activities and 2) the mar-keting and business areas that use the UAPL (Understand-Analyze-Plan-Launch) approach.
Finally, the operational and supporting infrastructure and business areas of a post-launch customer value chain environment use the LMAD (Launch-Manage-Adapt-Discontinue) approach to guide and direct their activities.
If any of these areas of an enterprise encounter a trouble spot in an existing process or offering, the Lean Six Sigma DMAIC (Define-Measure-Analyze-Improve-Control) method and any of its variants (that is,
DMAIIC (Define-Measure-Analyze-Improve-Innovate-Control), DMADV Analyze-Design-Verify), DMEDI (Define-Measure-Explore-Develop-Implement)) focus on the problem and its root cause-and-effect to determine the best correction.
ptg6842824 Figure 1 depicts how each method integrates with one another.
Right Tool at the Right Time 7
I-D-E-A
I2-D-O-V
U-A-P-L C-D-O-V
L-M-A-D
Marketing, Selling and Customer Value Chain
Production Engineering and
Manufacturing Tactical Offering
Commercialization Processes
Marketing and Business
Techinical
Strategic Research and Technology Development Process
D-M-A-I-C
Lean Six Sigma Problem-solving Process
Operational Post-Launch Process Strategic Offering Portfolio
Renewal Process Unique Focus on Proactive Growth
Unique Focus on Reactive Cost Control and Variation Reduction
Figure 1:Integrated Portfolio of Six Sigma Methods
The various Six Sigma approaches have their appropriate applications. Moreover, their candidate tools and methods sometimes overlap or feature tool variants of another’s, as they all build from the core Six Sigma
fundamentals.
Right Tool at the Right Time
Part II of this book explores how to select the most appropriate tool to answer
the right question at the right time. It organizes the tools in alphabetical
order and, using an encyclopedia-style article format, describes what question each tool tries to answer and how to use the tool.
Take a closer look at the structure of the various Six Sigma (or Lean Six Sigma) methods to understand their similarities and differences and when best to apply each of them. Start with Part I to understand the various methods and their structure, requirements, deliverables, and list of candi-date tools. Afterward examine Part II, the heart of this book, to decide which of the candidate tools might be appropriate for your project. Part II is structured as a desk reference that inventories the different tools and techniques. Each tool “article” describes the main purpose of the tool, how best to use it, how to interpret the results of the tool, and any variations on how to apply the tool or technique. Most importantly, Part I lists the candi-date tools aligned with particular requirements and task-deliverable
ptg6842824 combinations, but Part II identifies in more detail which key question each
tool tries to answer. Remember—an effective Six Sigma practitioner scruti-nizes the candidate tool set and selects the right tool, at the right time, to answer the right question.
Special Note
Throughout this book, the word “product” references to a generic company “offering” and represents both a tangible product as well as a services offering. This book discusses technology-based products frequently because of marketing’s interdependency with the technical community. In parallel, R&D, design and production/services support engineering should be using growth and problem prevention-oriented forms of Six Sigma in their phases and gate processes. The Six Sigma approach serves as a common language between the marketing and technical disciplines. The term “solutions” usually involves both tech-nology and services; thus, “product” and “services” encompass the scope of a given solution. Regardless of the offering, the Six Sigma approach we are outlining is the same and can be applied to either a tangible product or a services offering.
In addition, the term “Six Sigma” refers to the generic field or disci-pline and encompasses the many different approaches. People may dis-tinguish Six Sigma (SS), Lean Six Sigma (LSS), Design for Six Sigma (DFSS) and Six Sigma for Marketing (SSFM) from one another. However, this book uses “Six Sigma” categorically unless otherwise noted.
What this Book Covers
The Treasure Chest is organized into three parts: 1) Six Sigma methodology, 2) tools and techniques, and 3) best practices applicable to Six Sigma deploy-ment. The book uses an encyclopedia-like format made up of over 60 topics. Part I Six Sigma Methodology Overview—Choosing the Right
Approach to Address the Requirements
This segment of the book presents an overview the various Six Sigma approaches and describes the purpose of each. With the knowledge of the different methods, this book connects the requirements of a method to the appropriate candidate tools and techniques. This Part serves as the foun-dation for selecting the right tool for a given purpose.
ptg6842824 It discusses the various technical, business and marketing Six Sigma
methods, including DMAIC, Lean Six Sigma, Design for Six Sigma (DFSS), and Six Sigma for Marketing (SSFM). Within each approach, a general description, common applications, and key requirements provide an overview of its structure and purpose. In addition, the key require-ments determine each method’s unique tools-tasks-deliverables combina-tion. The Method Section provides the foundation for comparing and contrasting the different approaches. Once a method is selected, it estab-lishes a team’s common language, regardless of whether or not people are part of a hetero- or homogeneous team. The method defines the require-ments for its work activities. It sets expectations, describes required deliv-erables and their due dates, and identifies who does what when. A common method is the single most critical unifying theme for a team’s work. If it is well understood and followed by each team member, then collaboration, coordination, and communication can occur fluidly. Part II Six Sigma Encyclopedia of Business Tools and Techniques— Choosing the Right Tool to Answer the Right Question at the Right Time This Part features an in-depth look at a robust library of tools, organized in alphabetical order for easy reference. By design, it represents the bulk of this book, with an exhaustive review of the Growth and Lean Six Sigma tools and techniques. Each tool (tangible item) or technique (for example, brainstorming) features a “how to” description explaining how to utilize the tool and interpret typical outcomes. Each description identi-fies the deliverable the tool or technique supports. Part II features the fol-lowing topics for each of the 60+ tools included in this book:
• The question the tool helps to answer
• Any alternative names or variants associated with the tool
• When best to use the tool or technique
• A brief description and useful real-world examples
• How to implement the tool for your application
• How to analyze and apply its output
• Helpful hints and tips that encourage you to think outside of the box
• Supporting candidate tools that link to the featured tool, depending on the question needing to be answered, by providing either input to or using the output from this featured tool
Part II begins with a useful summary table of tools organized by the type of question it helps to answer. The Treasure Chest organizes the candidate tools and techniques alphabetically for easy reference. The encyclopedia includes an array of soft tools and techniques, graphical methods, and statistical tools. The statistical tool descriptions leverage some of the appropriate software
ptg6842824 tools such as MINITAB, Minitab’s new Quality Champion, Decisioneering
Crystal Ball, Visio, and other Microsoft applications, such as Excel. Part III Best Practices Articles
This portion of the book contains a series of articles written by well-reputed professionals that complements and extends beyond the world of Six Sigma to provide that competitive advantage in growth and operational excellence. It features a collection of technical and humanistic topics ranging from the latest thinking on benchmarking strategy to determining and offering the best portfolio. Articles describe how best to accelerate the development of an offering, how to ensure design robustness, and how to govern projects. Part III includes a discussion on best practices to introduce, deploy, and sustain a major culture change, such as deploying Six Sigma thinking, by featuring a set of articles to support a change initiative including communities of prac-tice and project management; simulation approach to training of new skills, knowledge, and attitudes; and designing collaborative work relationships.
A final note, the “Six Sigma for Marketing” (or SSFM) terminology in the marketplace may mislead prospective practitioners wishing to use Six Sigma to drive innovation and growth. While the primary application of SSFM involves processes typically associated with marketing, the respective work often encompasses additional functional disciplines within a company. Depending on the size of the firm and its business model, the professionals involved in 1) portfolio renewal, 2) offering development and commercializa-tion preparacommercializa-tion, and finally 3) post-launch operacommercializa-tions management through-out an offering’s lifecycle reach beyond just marketing. General business professionals involved in these three processes also represent disciplines such as strategic planning, pricing, finance, customer administration, customer service and support, professional services, and logistics and supply chain. In fact, the third process involving post-launch operations spans the entire cus-tomer value chain. Hence, when this book references “SSFM,” it follows the marketplace terminology of the emerging Six Sigma focus. In the context of SSFM, the identification of “marketing” (and sometimes sales) distinguishes the new Six Sigma application as different from the classic variation reduc-tion, problem-solving, and cost cutting approach, and as different from the technical DFSS (Design for Six Sigma). However, the Treasure Chest intends the reference to marketing as a “loose” association and prefers the broader refer-ence of “general business” to better articulate its broader scope and applicabil-ity. This book works nicely as a sequel to the Six Sigma for Marketing Processes, co-authored by CM Creveling, L. Hambleton, and B. McCarthy.
Part IV Appendixes
The Appendixes contain a set of references such as charts and statistical tables for hypothesis testing, a glossary, and a list of references.
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P a r t
I
Six Sigma Methodology
Overview: Choosing the Right
Approach to Address the
Requirements
Section 1 Define-Measure-Analyze-Improve-Control (DMAIC) Section 2 Lean and Lean Six Sigma
Section 3 Design for Six Sigma (DFSS) Section 4 Six Sigma for Marketing (SSFM)
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1
Define-Measure-Analyze-Improve-Control (DMAIC)
Six Sigma’s most common and well-known methodology is its problem-solving DMAIC approach. This section overviews the methodology and its high-level requirements, given that the requirements define the appropriate deliverables, which dictate the tasks and the tool selection to aid in the task. This section also outlines the DMAIC standard toolset, through the understanding of the tool-task-deliverables linkage, to facilitate appropriate selection of a tool when refer-encing the “how to” tool articles in Part 2 of this book.
What Is the Main Objective of this Approach?
The DMAIC (Define-Measure-Analyze-Improve-Control) is the classic Six Sigma problem-solving process. Traditionally, the approach is to be applied to a problem with an existing, steady-state process or product and/or service offering. Variation is the enemy—variation from customer speci-fications in either a product or process is the primary problem.
Variation can take on many forms. DMAIC resolves issues of defects or failures, deviation from a target, excess cost or time, and deterioration. Six Sigma reduces variation within and across the value-adding steps in a process. DMAIC identifies key requirements, deliverables, tasks, and standard tools for a project team to utilize when tackling a problem.
Brief Description of DMAIC Applications
This classic or traditional Six Sigma methodology was designed to solve a problematic process or product and/or service offering to regain control. It addresses improvements in productivity (how many), financial (how much money), quality (how well) and time (how fast)—PFQT. Originally costs dominated the financial aspects, but lately project focus has shifted
ptg6842824 to revenues and growth. The 5-step DMAIC [pronounced “duh-MAY-ick”]
method often is called the process improvement methodology.
The classic strategy reduces process variance (in total, across the activ-ities and within-step) to bring it back on target—the customer specifica-tion or requirement. Knowing that Six Sigma resolves more issues than just cycle time, Figure 1-1 highlights its impact on cycle time by contrast-ing a problematic process versus its post-Six Sigma improved state.
Problematic Process
Step 1 Step 2 Step 3 Step 4
Process After Six Sigma
Step 1 Step 2 Step 3 Step 4
Cycle Time
Figure 1-1:Six Sigma’s Impact on Cycle Time
The DMAIC approach is designed to allow for flexibility and iterative-work, if necessary. As more is learned through the 5-step process,
assumptions or hypotheses as to the root cause of the problem may be disproved, requiring the project team to revisit them and modify or to explore alternative possibilities. For example, root cause to a sales force effectiveness issue may have been hypothesized as a sales training prob-lem in a specific geographic region. Rather than jumping to conclusions without facts by implementing a new sales training program, the Six Sigma project team wisely decides to gather facts about the problem first. After some investigation and analysis, the team discovers that the root cause points to an issue with sales management direction, not lack of sales representatives’ knowledge and skills. If the project team acted upon the original assumption, time and money would have been wasted on developing a mismatched solution that would have produced poor results; the team’s hard work would have gone to waste. Instead, the team did a mid-course correction based on facts, adjusted its hypothesis, and developed a solution directly aimed at the true root cause—hence favorable results ensued.
DMAIC builds on three fundamental principles:
• Results-focused; driven by data, facts, and metrics.
• Work is project-based (short-term in nature, with length depending on scope and complexity) and project-structured, versus an ongoing process.
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• Inherent combination of tools-tasks-deliverables linkage that varies by step in the method.
The DMAIC methodology uses a process-step structure. Steps generally are sequential; however, some activities from various steps may occur concurrently or may be iterative. Deliverables for a given step must be completed prior to formal gate review approval. Step Reviews do occur sequentially. The DMAIC five steps are
Step 1. DEFINE the problem and scope the work effort of the project team.The description of the problem should include the pain felt by the customer and/or business as well as how long the issue has existed. Hence, identify the customer(s), the project goals, and timeframe for completion.
The appropriate types of problems have unlimited scope and scale, from employee problems to issues with the production process or advertising. Regardless of the type of problem, it should be systemic—part of an existing, steady-state process wherein the problem is not a one-time event, but has caused pain for a couple of cycles.
Step 2. MEASURE the current process or performance. Identify what data is available and from what source. Develop a plan to gather it. Gather the data and summarize it, telling a story to describe the problem. This usually involves utilization of graphical tools. Step 3. ANALYZE the current performance to isolate the problem.
Through analysis (both statistical and qualitatively), begin to for-mulate and test hypotheses about the root cause of the problem. Step 4. IMPROVE the problem by selecting a solution. Based on the
identified root cause(s) in the prior step, directly address the cause with an improvement. Brainstorm potential solutions, pri-oritize them based on customer requirements, make a selection, and test to see if the solution resolves the problem.
Step 5. CONTROL the improved process or product performance to ensure the target(s) are met.Once the solution has resolved the problem, the improvements must be standardized and sustained over time. The standard-operating-procedures may require revi-sion, and a control plan should be put in place to monitor ongo-ing performance. The project team transitions the standardized improvements and sustaining control plan to the process players and closes out the project.
A DMAIC project typically runs for a relatively short duration (three to nine months), versus product development projects (using UAPL or DFSS) and operational line management (using LMAD), which can run
Brief De scription of DMAIC Applications 15
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ptg6842824 years. Given the relatively shorter duration to other types of Six Sigma
methodologies, we distinguish the DMAIC as having five steps, rather than phases.
The DMAIC method is primarily based on the application of statistical process control, quality tools, and process capability analysis; it is not a product development methodology. It can be used to help redesign a process—any process, given that the redesign fixes the initial process problem. To be implemented, the method requires four components:
• A measurement system (a gauge) of the process or product/service offering in trouble.
• Standard toolsetthat supports tasks to produce deliverables (including statistical, graphical, and qualitative tools and techniques).
• An ability to define an adjustment factor(s) to correct the process or product/service offering back on target.
• A control schemeto maintain the improvement or correction over time by implementing a control plan with a monitoring system to audit the response performance against statistical control limits and defined action plans if needed.
What Key Overall Requirements Define this Approach?
Requirements come from the customer and the business, depending on the problem scenario. The (internal and external) customer requirements get translated into what is critical-to-quality (CTQ). These CTQs define the criteria to evaluate what good looks like—how well the project scope and deliverables meet requirements. Hence, the project team must meet the requirements of a phase before declaring completion and closing it out.
The DMAIC method was designed and structured to answer the fol-lowing overall business questions:
• What does the customer define as the problem?
(Secondarily, is the problem sustained over time, is it chronic, or is it a one-time occurrence?)
• What characterizes the current problem (e.g., process and perform-ance metrics), and how has it changed over time?
(Secondarily, is the process in control, and does it have a good meas-urement system? Is the process capable of producing the customer requirements?)
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• What are the root causes, and what improvement actions correct them to meet customer requirements again?
(Secondarily, is the process capable of producing the customer requirements?)
• What controls should be implemented to sustain this improvement, including a warning system, action plan, and communication plan needed in case requirements fail to be met?
(Secondarily, can the improvements be sustained over time?)
What Requirement Determines the Key Activities in this
Approach?
The preceding key business questions determine the DMAIC architecture. Figure 1-2 depicts a high-level process flow of the DMAIC method
through its five steps.
What Requirement Determine s the Key Activitie s in this Approach? 17
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AIC
Define
Close Project No
Measure Analyze Improve Control
In Control? Good measurement system? Remove Measurement System variation Yes No No Yes Process Capable? Close Project Process Capable? Sustained Improvement? Yes Yes Close Project No Yes Yes No No Remove Known Special Causes Problem over-time?
Figure 1-2: High-Level DMAIC Process Flow
Table 1-1 shows the linkage between the high-level business require-ments and the five-step DMAIC method.
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Table 1-1: DMAIC Requirements-Step Linkage
Requirements Resulting High Level Task (Step)
What does the customer 1. DEFINE
define as the problem? • Describe in the words of the external or
internal customer—Voice of Customer (VOC).
• Define the boundary conditions set forth
by the business, including regulatory environment—Voice of Business (VOB).
• Understand the current process. What has
happened over time, examine process control charts to identify incidents of common and special cause variation— Voice of the Process (VOP).
What characterizes the 2. MEASURE
current problem (that is, • Measure the problem; describe it with
process and performance facts, data, and performance metrics.
metrics), and how has it Determine if the process in control and if
changed over-time? the measurement system is accurate.
• Considered iterative until metrics are
gathered over time.
What are the root causes? 3. ANALYZE
Determine if the process capable of pro-ducing the customer requirements. If not, consider it iterative until root causes are identified and verified with facts and data.
What improvement actions 4. IMPROVE
correct the root causes to Determing if the process is capable of
meet customer require- producing the customer requirements.
ments again? If not, consider it iterative until
improve-ments are identified and verified with facts, data, and performance metrics.
What controls should be 5. CONTROL
implemented to sustain this • Demonstrate how the improvements
improvement, including a and/or changes can be sustained.
warning system, action plan, • Manage Risks
and communication plan needed in case require-ments fail to be met?
ptg6842824 Figure 1-3 provides a DMAIC icon that reinforces both the overall flow
of a method and the purpose of each step and respective interrelationships. It summarizes the five-step DMAIC process and its notable iterative nature. Throughout the remainder of this text, Figure 1-3 will symbolize the
DMAIC approach and indicate a particular step within it if appropriate.
What Tools Are Aligned to Each Step of the Proce ss? 19
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AIC
Define Measure Analyze Improve Control
Figure 1-3: DMAIC Icon
What Tools Are Aligned to Each Step of the Process?
Given the preceding High Level Task Step(s), the following series of tables summarize the subsequent tool-task-deliverables combination associated with each individual step within the five-step approach.
The detail behind how to use each tool can be found in Part II, “Six Sigma Encyclopedia of Business Tools and Techniques: Choosing the Right Tool to Answer the Right Question at the Right Time.”
Table 1-2:Define Tools-Tasks-Deliverables
Step 1: DEFINE What does the customer
define as the problem?
Deliverables Tasks Candidate Tools and Techniques
Project Charter Approved Identify Problem • SMART
(contract with the statement/Opportunity • Project Charter Form
Sponsor regarding and Goal statement. containing: Problem
problem, project scope, Statement (As-Is),
project goal(s), key Desired State (To Be),
deliverables, timeframe, and the Business Reasons
and budget) • Big “Y” over time
Define Measure Analyze Improve Control
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Table 1-2:Continued
Deliverables Tasks Candidate Tools and Techniques
High-level Process Develop High-level • Process Map
Map Constructed Process Map • RACI Matrix
Critical Parameters Gather VOC and • VOC/VOB Gathering
Hypothesized Business techniques
Requirements • Current process control
charts (VOP)
• Stakeholder Analysis
• CTQ
Project Charter Develop Communi- Communication Plan
Published and cation Plan template
Communicated
High-Level Project Finalize Project • Project Charter Form
Plan Defined and Charter • High-level Process
Approved Map
• SIPOC
• Project RACI Matrix
Table 1-3:Measure Tools-Tasks-Deliverables
Step 2: MEASURE What characterizes the
current problem, and how has it changed over time?
Deliverables Tasks Candidate Tools and Techniques
Data Collected • Identify Sources • Y = f(X); Big “Y” and
of Data little “Ys”
• Collect Baseline • Data Gathering Plan
Data from existing template
process • Control Charts
• Determine current • Statistical Sampling
Process Performance; • Graphical Methods
is it in control? • QFD (Quality Function
• Remove any known Deployment)
special causes; verify if process is in control
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Deliverables Tasks Candidate Tools and Techniques
Process Map Defined Develop Detailed • Detailed Process Map
In-depth With Current Process Map • RACI Matrix, revised
Measures
Current Measurement • Validate measure- • Measurement System
System Capability ments and Analysis (MSA)
Evaluated collection system • Process Capability
• Is the process Analysis
capable of meeting requirements?
Project Charter and • Revise Problem and • Project Charter; its plan
Plan updated, as Goal statements as and milestones
necessary needed • Project RACI Matrix
• Update Project
Plan, as needed
Table 1-4:Analyze Tools-Tasks-Deliverables
Step 3: ANALYZE What are the root causes
of the current problem?
Deliverables Tasks Candidate Tools and Techniques
Data Analyzed •Validate gaps in • Y = f(X); Big “Y”; little
requirements vs. “Ys” and the “Xs”
current metrics • Critical Gap/Step
•Establish Y=f(X) Analysis
•Quantify Opportunity • Pareto Charts
to close gaps • Statistical Analysis:
Normal Distribution, Variation
• Correlation and
Regression
What Tools Are Aligned to Each Step of the Proce ss? 21
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Define Measure Analyze Improve Control
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Table 1-4:Continued
Deliverables Tasks Candidate Tools and Techniques
Process Analyzed •Develop Detailed • Detailed Process Map
Process Map (inputs, outputs,
met-•Establish Y=f(X) rics, process step
•Quantify Opportunity owners)
to close gaps • RACI Matrix, revised
• Process Mapping of Critical Parameters • Y = f(X) • Pareto Charts • Process Capability Analysis
Root Cause Analyzed •Conduct Root • Brainstorming
Cause Analysis Technique
•Prioritize Root • Cause and Effect
Causes Diagrams
•Quantify Oppor- • Five Whys
tunity to close gaps • Affinity Diagram (KJ)
• Hypothesis Testing of
key causes and/or critical parameters (vital few Xs) • Inferential statistics (Correlation and Regression) • DOE • FMEA
Project Charter and •Revise Problem and • Project Charter;
Plan updated, as Goal statements as its plan and milestones
necessary needed • Project RACI Matrix
•Update Project Plan,
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Table 1-5:Improve Tools-Tasks-Deliverables
Step 4: IMPROVE
What improvement actions correct the root causes to meet customer requirements again?
Deliverables Tasks Candidate Tools and Techniques
Potential Solution Develop Potential • Brainstorming
Generated Improvements or Technique
solutions for root • Positive Deviance
causes • TRIZ
Potential Solution •Develop Evaluation • Basic DOE
Evaluated Criteria • Pilots/Tests
•Measure results • FMEA
•Evaluate improve- • Cost/Benefit Analysis
ments meet targets
•Evaluate for Risk
Solution Selected Select and Implement • Pugh Concept
improved process and Evaluation
metrics • Solution Selection
matrix
• Force Field diagram
• QFD
• Measurement System
Analysis (MSA)
• Process Capability
Analysis
Improved Path Develop Detailed • Detailed Process Map
Forward Implemented Future Process Map • RACI Matrix, future
of improvement • Procedure manual
(standard operating procedure)
• Implementation and
Transition Plan
Project Charter and •Revise Problem and • Project Charter; its plan
Plan updated, as Goal statements as and milestones
necessary needed • Project RACI Matrix
•Update Project Plan,
as needed
What Tools Are Aligned to Each Step of the Proce ss? 23
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Table 1-6:Control Tools-Tasks-Deliverables
Step 5: CONTROL
What controls should be implemented to sustain this improvement?
Deliverables Tasks Candidate Tools and Techniques
Control Plan Defined •Document New • Control Plan Design
Measurement • Control Charts (SPC)
Process • FMEA/Risk Analysis
•Define control plan • Communication Plan
• Stakeholders Analysis
Improvements/ Validate metrics and • Measurement System
Innovation Implemented collection systems Analysis (MSA)
• Process Capability
Analysis
• Cost/Benefit Analysis
Training Conducted Train • Training/Transition plan
Process Documented Document recommend- • Process Map
ation or improvement • RACI
summary and highlight • Procedure manuals
changes from As-Is to Improved
Tracking System Establish Tracking • Scorecard or Dashboard
Deployed Procedure • Data Mining (MINITAB
graphical data analysis)
Lessons Learned •Revise Problem and • Project Charter; its plan
Documented and Goal statements to and milestones
Project Closed reflect actual • Project RACI Matrix
•Update Project Plan • New SIPOC
to reflect actual
•Record lessons
learned and file along with final project documentation
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What Are Some of the Key Concept s that Characterize this Approach?
What Are Some of the Key Concepts that Characterize
this Approach?
There are some key characteristics that distinguish DMAIC from other Six Sigma methods. The following overview wraps up the DMAIC highlights and introduces some of its variants.
How Is the Problem Defined?
The problem statement in a Project Charter typically speaks to defects or variance from a target over time with an existing, steady state, process, or product. (The charter is part of a standard Six Sigma toolset used to docu-ment the project scope. See Also“SMART,” in Part II, p. 665) Typically, the customer should determine the target; however, at times the business, industry standard, or regulatory agency may set it. Time-based problem statements indicate the problem may be chronic (has persisted for a period of time), which helps create a case for change (versus a one-time occurrence) to incite interest in and resources to tackle the issue.
Common metrics include DPMO (Defects per Million Opportunities (or units)), PPM (Parts per Million), Mean Time between Failures (MTBF), Cost, Percent Variance, or Errors.
What Is Commonly Measured?
Typically, three key items are measured:
• Output (or Outcome)—The end result of the process (or product) requiring improvement
• Process—The workflow (of activities and items) that produces the output
• Inputs—The raw materials and information used by the process to produce the output
The relationship of these three key items often is described as an equa-tion: Y = f(x), which reads, “Y is a function of X.” The “Y” refers to the out-put(s); the “X” refers to the key measures from the process variables (inputs and/or the process itself). See Also“Y=f(x),” in Part II, p. 758.
The DMAIC project goal is to identify the critical (or vital few) Xs—the
root cause of the problem—and select their optimal level(s) to best drive
the desired improvement in the output performance (sometimes called the “Big Y”). This language sounds foreign to many people not comfort-able with mathematically-structured sentences; however, it is readily used in most Six Sigma texts. A simpler articulation is the goal of a DMAIC project is to improve PFQT—Productivity (how many), Financial (how much money), Quality (how well), and Time (how fast).
25
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ptg6842824 Are There any DMAIC Variations?
There are two prevalent variations to the traditional DMAIC method. Both build on the DMAIC fundamentals but add new dimensions to extend its applications. The first is DMAIIC, wherein innovation is added for situations where a simple improvement modification is inadequate and a new design may be required. (Note that in the technical, engineer-ing arena that an innovation adaptation typically aligns with the
DMADV method. DMADV distinguishes itself from DMAIIC by not only its often unique environment scenario, but also it usually calls for a requirement of building a new process (or product design) from scratch at the start of the project; whereas, DMAIIC often is unaware of the redesign requirement until much later into the project lifecycle. See Also “DFSS,” in Section 3, p. 45) The second is Lean Six Sigma, which adds concepts of velocity, value-add, and flow to the DMAIC concepts.
1. DMAIIC—Adding an “I” for Innovation—Many organizations have found that improving a current process or product may not be enough to deliver the desired results, and at times innovation is needed. Since the project teams have just completed the Define-Mea-sure-Analyze stages of the process and are in the midst of Improve, rather than starting over from scratch, project teams have found that the work done to this point is a good foundation for innovation work. Hence, some companies have built on the DMAIC framework already in-place and added a second “I” for innovation to keep the project team progressing. Therefore, the variation is Define-Measure-Analyze-Improve/Innovate-Control.
Figure 1-4 shows the DMAIIC flow diagram and depicts how the Inno-vate tasks integrate into the classic DMAIC model.
2. Lean Six Sigma—Adding Lean Concepts—By incorporating lean concepts into DMAIC, the project adds a dimension of velocity (i.e. improved cycle time), value-add, and flow to what Six Sigma already offers.
Both concepts share similar views on customer-focus, process-centric work, and appropriate tools. Lean simply adds a deeper set of tools to eliminate waste between process steps handoffs. Often DMAIC pro-vides a project the big picture view (what the customer values balanced by business values) and process stabilization and capability—while Lean introduces speed and flow concepts at a more detailed level. The Define-Measure-Analyze-Improve-Control structure still holds true for Lean Six Sigma projects. See Also“Lean and Lean Six Sigma,” Section 2, p. 29, for more details on Lean.