Rubber & Plastics News • July 10, 2006 17www.rubbernews.com

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SUMMARY NOTICE OF PROPOSED SETTLEMENT IN CLASS ACTION

AND HEARING ON SETTLEMENT APPROVAL, PLAN OF ALLOCATION

AND REQUEST FOR ATTORNEYS’ FEES AND COSTS

TO: ALL PERSONS AND ENTITIES IN THE UNITED STATES AND ITS

TERRITORIES (EXCLUDING GOVERNMENT ENTITIES) WHO

DIRECTLY PURCHASED RUBBER CHEMICALS FROM

ANY DEFENDANT AT ANY TIME FROM MAY 1, 1995 THROUGH

DECEMBER 31, 2001.

YOU ARE HEREBY NOTIFIED, pursuant to an Order of the United States District Court for the Northern District of California, that a settlement of this litigation has been reached with defendants Bayer AG and Bayer Corporation (collectively referred to as “Bayer”). The settlement consists of an aggregate payment by Bayer of more than $250 million, which has already been paid into Escrow by Bayer, and Bayer’s cooperation in prosecuting claims against the remaining Defendants. The Court will hold a hearing on September 12, 2006, at 9:30 a.m. at the United States

District Court for the Northern District of California, 450 Golden Gate Avenue, Courtroom 11, 19th Floor, San Francisco, California 94102 to determine whether the proposed settlement and plan of allocation for the settlement proceeds are fair, reasonable, and adequate such that they should be granted final approval. The Court will also decide counsel's request for attorneys’ fees and reimbursement of expenses. The Defendants in this action are:

The rights and options available to members of the Class are discussed in the Notice of Proposed Settlement in Class Action and Hearing on Settlement Approval, Plan of Allocation, and Request for Attorneys’ Fees and Costs (“Notice”) which was mailed to potential Class Members on or about June 30, 2006. If you did not receive the Notice or the accompanying Proof of Claim form, you may obtain them at www.gilardi.com or by writing to In re Rubber

Chemicals Antitrust Litigation (Bayer), c/o Gilardi & Co., LLC, P O Box 8060, San Rafael, CA 94912-8060. You may direct questions about the lawsuit or the settlement in writing to Class Counsel at

the following addresses:

Do not contact the Court.

Dated: June 26, 2006 BY ORDER OF: Clerk of the United States District Court for the Northern District of California

IN RE RUBBER CHEMICALS ANTITRUST LITIGATION

MDL Docket No. C-04-1648 (MJJ) ALL CASES

THIS DOCUMENT RELATES TO: ALL ACTIONS

Bayer Settlement

Akzo Nobel Chemicals International B.V. Solutia, Inc. Akzo Nobel Chemicals, Inc. Flexsys N.V. Flexsys America L.P. Bayer AG

Bayer Corporation Rhein Chemie Rheinau GmbH Rhein Chemie Corporation Crompton Corporation Uniroyal Chemical Company, Inc.

Steven. O. Sidener, Esq. Gold Bennett Cera & Sidener LLP 595 Market Street. Suite 2300 San Francisco, CA 94105

Richard A. Koffman, Esq. Cohen, Milstein, Hausfeld & Toll, P.L.L.C, 1100 New York Avenue, N.W., Suite 500 Washington, DC 20005-3964

Technical

Lean Six Sigma working in the latex industryBy Sandy Klaasse and Jeff Lytle

Omnova Solutions Inc.

The past several years have presentedseveral challenges for the latex indus-try. Economic cycles have intensifieddue to the globalization of our supplyand customer base, the continued drivefor innovative products and the balanceof capital efficiency and utilization.These factors have accelerated the rateat which all of our companies must beable to meet ever-changing marketneeds and supply dynamics.

How do corporations position them-selves for the speed and flexibility themarketplace is demanding? How do theystrengthen their ability to weathergreater cyclicality in raw material sup-ply? How do they delight their cus-tomers and bring them value to ensurecustomer retention and satisfaction?How do they keep their employees en-gaged, accountable and satisfied?

The answer to these questions is mul-tifaceted, but we have found Lean SixSigma to be a key strategic component.Lean Six Sigma helps to eliminate non-value added activities, drive down costs,maximize invested capital, improve cashflow and ensure an externally focusedcorporation that fosters teamwork andmaximizes customer value.

Why Lean Six SigmaThe success that early practitioners

such as Motorola, Allied Signal andGeneral Electric demonstrated with SixSigma is well documented. Over thepast several years many other corpora-tions, including specialty chemicals pro-ducer Omnova Solutions Inc., have seensimilar success with Six Sigma method-ology. The foundation of Six Sigma liesin strong statistical analysis leading tosignificant cost savings through the re-duction of defects and variation.

Today, however, the speed with whichcompanies must respond to an increas-ingly demanding and complex market-

Executive SummaryFor several years Six Sigma has been effectively used to drive continuous im-

provement activities in batch process industries with little attention given to Lean.Lean tools and philosophies were traditionally viewed as only applicable to discreteproducts and processes like automotive parts and pieces. This is not surprisingsince the roots of Lean stem from the Toyota Production System, and most peoplethink of a production cell when they think about Lean.

After several years of utilizing Six Sigma methodology, Omnova Solutions Inc. isearly in its journey of successfully incorporating Lean with Six Sigma in an emul-sion polymerization process environment. Combining Lean’s focus on reduction ofwaste and non-value added activities with Six Sigma’s focus on reduction of varia-tion, we have a powerful engine to drive continuous improvement and shape astrong business culture built on speed of execution and customer responsiveness.Lean Six Sigma can truly maximize the value provided to latex customers and dri-ve operating profit and cash flow improvements in batch process industries.

Fig. 1. Principles of Lean Six Sigma.

Fig. 2. Defining value to customers.

place is revealing that Six Sigma alonedoes not provide all of the tools an organi-zation needs.

In most cases there is more to fix thanjust variation and defects, and force fit-ting Six Sigma tools into each improve-ment opportunity gets to be clumsy andin some cases very difficult.

Companies also are looking for waysto drive more rapid improvement thanthe traditional six-month average timefor Six Sigma projects. Process industrycompanies are, therefore, looking acrossa diverse set of industries for best prac-tices that provide the additional toolsand management philosophy to succeedin these challenging times.

This search has led to Lean manufac-turing. With roots back to the ToyotaProduction System, Lean has long beenassociated with the automotive industryand discrete parts suppliers. Process in-dustries have been reluctant to pursueLean because it has traditionally beenassociated with moving equipmentaround to set up work cells. It is hard to

imagine moving a polymerization vesselor coating line to set up a work cell. It isjust not practical and in most cases notfeasible.

Why add Lean to Six Sigma in processindustries?

Lean has proven itself to “deliver re-sults” and the reality is that there is farmore to Lean than work cells. Lean in-cludes visual controls, standardizedwork, kanbans, flow at the pull of thecustomer, reduction of non-value addedwork, 5S, total productive maintenance,

TECHNICAL NOTEBOOKEdited by Harold Herzlichh

Kaizen and change-over reduction toname just a few key tools. Add this to theSix Sigma tool kit and an organizationnow has the right tool for the right im-provement opportunity. See Fig. 1 forthe principles of Lean Six Sigma.

So where do you start? Lean Six Sig-ma starts by defining customer value.

Customer valueLean philosophy revolves around the

identification of waste, which is similar

to Six Sigma’s focus on variation. TheLean definition of waste is “anythingthat the customer is not willing to payfor.”

Everything the customer is willing topay for is considered a value-added ac-tivity. Examples of waste include over-production, waiting time, defects, un-necessary transportation, excess motionor extra processing due to incapable ma-chines or processes.

See Lean, page 19

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Technical

Defining what the customer is willingto pay for can be a difficult step, as seenin Fig. 2. Organizations naturally as-sume they already know what the cus-tomer values—and why not? They arealways talking with customers, negoti-ating contracts and responding to com-plaints and inquiries.

In Lean Six Sigma, defining customervalue goes beyond price, quality and ser-vice. Customers define value based onall of their interactions with a supplier.Each of these interactions is known as“moments of truth.”1 Are you meetingthe expectations of your customers ineach of these interactions? How easy isit for your customers to do business withyour organization, as shown in Fig. 3?

Lean Six Sigma looks to define cus-tomer value at every point of interactionwith the customer; this information isthen used to drive the elimination ofwaste and defects in both transactionaland manufacturing processes. See Fig.4 for the first steps in defining customervalue.

Lean Six Sigma tools, capabilitiesOnce the organization understands

what the customers value, Lean Six Sig-ma tools can be used to drive improve-ment across the organization.

If your organization is not happy withtoday’s results, identify the valuestream the organization wants to im-prove. A value stream is typically aproduct platform. At Omnova, for exam-ple, a value stream would be styrene bu-tadiene latex for the paper industry.

Having selected a value stream to op-timize, the next step is to map the exist-ing value stream.

A value stream map is the set of activ-ities performed to transform the prod-ucts and services into what is requiredby the customer. The critical metricacross the value stream map is time asseen in Fig. 5. Time is defined as value-added time, relative to what the cus-tomer is willing to pay for, and non-val-ue-added time or waste.

In most industries when an organiza-tion first creates a value stream map, itis not unusual to find it is only addingvalue during about 0.5 to 5 percent ofthe total time. The opportunities forimprovement are found in reducing the95 percent of activities that are non-value added.

Lean

Fig. 4. Steps in defining customer value.

Fig. 3. Ease for customer.

Fig. 6. How Lean Six Sigma fits into or-ganization.

The value stream map is used to de-fine project opportunities. These pro-jects may include pure Six Sigma pro-jects where defects and variation arecausing waste. They also will includeLean projects that increase the speedacross the value stream through the re-duction of non-value added activities.An example may include setting up akanban system to pull material throughthe process at the flow of the customerversus push material through based onless than accurate forecasts.

One of the most exciting aspects ofLean projects is that they tend to be exe-cuted through Kaizen events. These arecross-functional team-based improve-ment activities that last from one to fivedays.

At the end of a Kaizen event, positivechange has been made. The energy forchange needs to be fostered through a“just do it” culture versus one that isslow to move due to over analysis andbureaucracy. The organization needs tobe structured and prepared to supportrapid change.

Lean Six Sigma organizationThe functional organizational struc-

ture needed to be successful in Lean SixSigma is similar to that needed for Six

See Lean, page 20

Fig. 5. Value stream map.

Continued from page 17

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20 Rubber & Plastics News • July 10, 2006 www.rubbernews.com

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Sigma. This structure includes Lean SixSigma BlackBelts and Champions. Toensure success, however, one of the mostcritical factors is the passionate and un-yielding support for Lean Six Sigma bythe CEO and his/her senior leadershipteam. The next critical organizationalfactor is selection of the best people inthe organization to serve as “full-time”Lean Six Sigma BlackBelts. Typically,this team will receive about five weeksof Lean Six Sigma training over fivemonths and then serve as a full-timeBlackBelt for approximately two to

LeanContinued from page 19

three years.With leadership commitment and a

great team, the next critical factor ispicking the right projects to work on. Asmentioned previously, Lean Six Sigmaprojects are associated with valuestreams and are usually identified froma value stream map analysis. The key isto select projects closely aligned withthe customer and strategic needs of thebusiness.

It also is critical that every projecthas clear measurable metrics that canbe tracked to the bottom line. The twometrics Omnova uses most often arecash flow and operating profit improve-ment from cost savings. Financial ac-countability is critical. Fig. 6 providesthe critical organizational success fac-

Technicaltors.

Lean Six Sigma benefitsOrganizations have realized substan-

tial bottom line impact from Lean SixSigma activities. The investment in re-sources may seem significant; however,the typical annualized impact per expe-rienced BlackBelt is $1 million.

See Fig. 7 for the value proposition ofLean Six Sigma.

Omnova has been actively involvedwith Six Sigma since 1995 and hastrained about 2.5 percent of its workforce as Six Sigma BlackBelts. The 2003BlackBelt training wave was the firsttraining wave that incorporated Leanwith Six Sigma.

To date, Omnova has successfullycompleted Lean Six Sigma projectsacross several value streams. Fig. 8and 9 provide some results.

Omnova has targeted 15 valuestreams across the organization. Someprojects underway within these valuestreams include visual managementsystems, laboratory efficiencies, cycletime reduction and utility optimization.The current projects are a great mix ofboth Six Sigma and Lean and havedemonstrated the value of Lean in aprocess industry setting without need-ing to move a polymerization vessel orcoating line to realize benefits.

The Lean Six Sigma visionImagine an organization that is exter-

nally focused on the voice of the cus-tomer, one that can quickly respond tochanging market pressures and needsthrough quick Kaizen improvement ac-tivities. Imagine an organization whereall associates look to reduce waste andvariation and feel empowered to drivepositive change. Imagine an organiza-tion that is passionate in its pursuit ofperfection and delivers continued im-provements in productivity, cash flow

and operating profit. This is a Lean SixSigma organization. Fig. 10 tells how toget started.

References1. Carlzon, Jon. “Moments of Truth.” New York:Ballinger Publishing Co., 1987.2. George, Michael. “Lean Six Sigma.” New York:McGraw – Hill Co., 2002.3. Hanna, David. “Designing Organizations for HighPerformance.” Massachusetts: Addison-Wesley Pub-lishing Co., 1988.4. Human Capital Associates. Lean Six SigmaTraining. Colorado Springs, Colo., 2003.5. Pande, Peter, et al. “The Six Sigma Way: HowGE, Motorola, and Other Top Companies are Hon-ing Their Performance.” New York: McGraw-HillCo., 2000.6. Smith, Dick, et al. “Strategic Six Sigma: BestPractices from the Executive Suite.” New York: Wi-ley, John & Sons, Inc., 2002.7. Womack, James and Jones, Daniel. “Lean Think-ing.” New York: Simon & Schuster, 1996.

Fig. 7. Questions on value of Lean SixSigma.

Fig. 8. Lean Six Sigma project beforeand after.

Fig. 10. Steps to get started.

Fig. 9. Benefits of Lean Six Sigma.

The authorSandra Klaasse is vice president,

Lean SixSigma, for Omnova Solu-tions Inc.

She has worked with Omnova asvice president of manufacturing op-erations, general manager of func-tional coatings and vice president ofpaper chemicals for the company’sPerformance Chemicals segment.

Klaasse served Omnova Solutions’former parent, GenCorp, in many posi-tions. Prior to joining GenCorp,Klaasse was a technical service engi-neer for Firestone Synthetic Rubber &Latex Co. and Ashland Chemical Co.

Rubber groupsChicago Rubber Group: Golf outing, July 27, IndianLakes resort, Bloomingdale, Ill. (Mike Szymborski,phone 262-472-6612; Web site www.chicagorubber-group.com)

Los Angeles Rubber Group: Golf tournament, July24 (Russ Shorter, phone 562-905-3456; e-mailruss@viprubber.com; Web site www.tlargi.org)

New York Rubber Group: Summer golf outing, Aug.3, Black Bear Country Club, Franklin, N.J. (Robert Car-

roll III, phone 609-695-6211)

Ohio Rubber and Plastics Group: Golf outing, Aug.28, Silver Lake Country Club, Akron (Bev Lipinski,phone 330-920-1699; Web site www.ohiorpg.org)

Twin Cities Rubber Group: Golf outing, Aug. 1, Mis-sissippi Dunes, Cottage Grove, Minn. (Karin Kingstad,e-mail karin.kingstad@lanxess.com)

Western New York Rubber & Plastics Group: Golfouting, Aug. 15, Glen Oak Golf Course, East Amherst,N.Y. (Jerry Fasolino, phone 716-691-2141)

Wisconsin Rubber Group: Golf outing, Aug. 15 (Website http://wisconsinrubbergroup.com)

Seminars/conferencesAdhesives/Sealants Tech Training/Workshops:Program on adhesives and sealants, Aug. 1-2, Sept. 19-20, sponsored by Chemsultants International (Web sitewww.chemsultants.com/chemworkshops)

International Latex Conference: Conference and ex-hibition, July 25-26, Marriott-Charlotte City Center,Charlotte, N.C., sponsored by Rubber & Plastics News

and Akron Dispersions Inc. (Jim Finn, phone 330-666-0045; e-mail jimfinn@akrondispersions.com)

ITEC 2006: International Tire Exhibition and Confer-ence, Sept. 12-14, John S. Knight Center, Akron, spon-sored by Rubber & Plastics News (Web site www.rub-bernews.com)

Trade/tech associationsTire Society: Twenty-fifth annual business meetingand conference on tire science and technology, Sept. 11-12, Akron (www.tiresociety.org)

Calendar

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