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L6s
A look at process improvement…
The Evolution of Lean Six Sigma
The Lean Six Sigma Methodology
Agenda
Concluding Comments / QA
L6s
L6sProcess Improvement
“A project is a temporary endeavor undertaken to create a unique product, service, or result.”
An ongoing work effort is generally a repetitive process because it follows an organization’s existing procedures.”
PMBOK, 4th ed.
So… why should project managers care about process improvement???
L6sProcess Improvement
• 4 Reasons…– Project Management is a discipline built on processes
– Project plans link processes together to achieve project results
– Improving process efficiency and effectiveness, in both dimensions, is fundamental to improving overall project management performance
–Project managers typically must include quality assurance processes for project deliverables
L6sBut, typically, what can be said about our processes?
“We don't know what we don't know. We can't act on what we don't know.We won't know until we search.We won't search for what we don't question.We don't question what we don't measure.Hence, we just don't know.”
– Dr. Mikel Harry
L6s Lean Six Sigma Process Improvement
Define
Measure
AnalyzeImprove
Control
Lean Six Sigma seeks to :• Improve the effectiveness (quality) of manufacturing and
business processes by identifying and removing the causes of defects (errors) and variation.
• Improve the efficiency of manufacturing and business processes by identifying and removing sources of waste within the process.
• Improve effectiveness and efficiency,based on outputs that are critical tocustomers.
L6s Lean Six Sigma Process Improvement
• It is a management philosophy - a commitment to managing through process, not function, and making decisions based on facts and data.
• Lean Six Sigma seeks to understand performance concerns through a methodology and toolset focused on understanding customer through process, value flow and data driven analysis.
L6sLean Six Sigma Practitioners
• Most Lean Six Sigma programs seek to drive a quality culture change through a multi-level based program.
Level Training
Green Belt LSS Methodology and basic tool set
Black Belt Green Belt content plus advanced data analysis
Master Black Belt Black belt content plus program management, leadership skills, some advanced tools
L6sKey Factors for Success
• Establish goals and objectives for the program up front.
• Strong Executive and mid-level management support.
• Integrate the program into existing operations not as a separate organization.
• Shared goals and objectives between practitioners and leadership.
• Build the program to change the culture so that at some future point, everyone is a practitioner.
L6s
1930 19501900
L E A N
S i x S i g m a
Ford Assembly Line
Guinness Brewery
Shewhart Introduces SPC
Gilbreth, Inc.•Management Theory•Industrial Engineering
Deming•14 Points•7 Deadly Diseases
Toyota Production System
Lean Six Sigma Timeline
L6s
1990 20001980
Motorola Introduces Six Sigma
S i x S i g m a
L E A N
Just – in–Time
SPC
Lean Mfg.
TQM
AlliedSIgnalGE Adapt LSS to Business Processes Lean
Six Sigma
Lean Six Sigma Timeline
L6sEvolution of Lean Six Sigma• Lean Six Sigma evolved over a century• It is built upon proven quality and process
improvement tools and techniques• Lean Six Sigma introduced three new principles or
methods:• Focus on quality and efficiency as defined by the
customer• Focus on financial impact to the bottom line• An enhanced problem solving methodology that
looks for sustainment of performance gains
Five Principles of Lean Thinking
• Specify value in the eyes of the customer• Identify the value stream and eliminate waste• Make value flow at the pull of the customer• Involve and empower employees• Continuously improve in the pursuit of
perfectionL6s
L6sSeven Types of Waste• Defects (the effort involved in inspecting for and fixing
defects)• Overproduction (making more than what is needed, or making
it earlier than needed)• Transportation (moving products further than is minimally
required)• Waiting (products waiting on the next production step, or
people waiting for work to do)• Inventory (having more inventory than is minimally required)• Motion (people moving or walking more than minimally
required)• Processing Itself
L6sVOC vs. VOP
Voice of Customer
Voice of Process
The Voice of the Process is independent of the Voice of the Customer
SigmaCapability
Defects per Million Opportunities
% Yield
2 308,537 69.15%
3 66,807 93.32%
4 6,210 99.38%
5 233 99.98%
6 3.4 99.99966%
L6sWhat’s good enough?
99% Good (3.8 Sigma) 99.99966% Good (6 Sigma)
20,000 lost articles of mail per hour (based on 2,000,000/hr)
7 articles lost per hour
Unsafe drinking water for almost 15 minutes each day
1 unsafe minute every 7 months
5,000 incorrect surgical operations per week
1.7 incorrect operations per week
2 short or long landings daily at an airport with 200 flights/day
1 short or long landing every 5 years
2,000,000 wrong drug prescriptions each year
680 wrong prescriptions per year
No electricity for almost 7 hours each month
1 hour without electricity every 34 years
L6sGoals of Lean Six SigmaLSL USL
Customer Target
DefectsDefects
Prevent Defects byReducing Variation
LSL USL
Customer Target
Defects
Prevent Defects byCentering ProcessLSL USL
Customer Target
Meet Customer Requirements
L6sIntroducing DMAICThe foundational methodology to Lean Six Sigma’s Success is, DMAIC. It’s
uniqueness as a problem solving methodology is it’s intentional focus on data and requirement of a sustainment strategy.
Define: Describe the problem quantifiably, and the underlying process to determine how performance will be measuredMeasure: Use measures / metrics to understand current performance and the improvement opportunityAnalyze: Identify the true root cause(s) of the underlying problemImprove: Identify and test the best (cost, time to implement, impact, etc.) improvements that address the root causes. Control: Identify sustainment strategies that ensure process performance maintains the improved state.
L6sThe Define Phase“Well begun is half done” – Mary Poppins
Purpose:• Identify the problem and underlying process to be improved• Understand the customer, their needs / requirements (CTQs)• Quantify the performance gap and its impact• Define the performance standard or measures• Set project success criteria• Ensure sponsorship and resources are in place
Deliverables:• Approved charter• Project plan with milestones• Planned benefit analysis• Team formed and engaged• High level process map• Customer performance requirements (CTQs) linked to process outputs
and value stream
L6sThe Define Phase - Example“Well begun is half done” – Mary Poppins
Problem:Project execution is poor at ScoobyDoo Enterprises.
Problem:Project execution is poor at ScoobyDoo Enterprises.Projects are always late and overbudget at ScoobyDoo
enterprises costing lots of money.60 out of 80 IT projects completed in 2008 at ScoobyDoo
enterprises exceeded time estimates by more than 25% at a cost of $21.1M dollars in expense and lost opportunity.
Problem:Project execution is poor at ScoobyDoo Enterprises.Projects are always late and overbudget at ScoobyDoo
enterprises costing lots of money.
Project Sponsor: Billy Bob Buckaroo, Exec VP IT ServicesProject Team: Sally Straightedge, Business Analyst
Wiley Poindexter, Technical Architect / Lead DeveloperReggie Rocketeer, PMP, Project Management LeadBruce Lee, LSS Black Belt
Objective: 50% improvement in on-time delivery; $10.5M benefit
L6sThe Define Phase - Example“Well begun is half done” – Mary Poppins
High Level Process Map:ScoobyDoo Enterprises utilizes PMI compliant process set.
L6sThe Measure Phase“Measure what is measureable, and make measurable what is not so.” – Galileo
Purpose:• Identifies / establishes data sources to be used for project• Identifies process steps for project focus• Establishes baseline process performance against CTQs
Deliverables:• Validated project problem definition• Data Collection plan• Detailed process map with ins/outs and associated measures• Measurement Accuracy / Consistency Assessment (MSA)• High level Root Cause Analysis to identify process focus• Stability assessment of the process
L6sThe Measure Phase - Example“Measure what is measureable, and make measurable what is not so.” – Galileo
Data Source: Project Tracking Database – 80 IT Projects, closed in 2008Validation of Data Source: Data is collected via automated time tracking.
Sampled 14 project confirmed project start and stop dates were accurate based on confirmation with accounting systems and email tracking.
L6sThe Measure Phase - Example“Measure what is measureable, and make measurable what is not so.” – Galileo
Baseline Performance: 63 out of 80 – 78.75%Total Cost of Poor Quality: $21.1M
L6sThe Measure Phase - Example“Measure what is measureable, and make measurable what is not so.” – Galileo
Potential Area of Focus Observed in Data: Project Manager Team
L6sThe Measure Phase - Example“Measure what is measureable, and make measurable what is not so.” – Galileo
Potential Area of Focus Observed in Data: Sponsoring Organization
L6sThe Analyze Phase“It requires a very unusual mind to undertake the analysis of the obvious.” – Alfred North Whitehead
Purpose:• Identifies actionable root causes – tied to discrete process
steps• Connects the Process Outputs (Ys) to Process Inputs (Xs) to
identify root causeDeliverables:
• A prioritized list of potential root causes• Data Collection / Analyzed supporting conclusions
L6sThe Analyze Phase - Example“It requires a very unusual mind to undertake the analysis of the obvious.” – Alfred North Whitehead
Why would the team a project manager came from make a difference?
• Different Experience Levels?
• Different Methodologies?
No; data shows no statistical difference.
Each team develops their own best practicesWhich process steps differ between Best and Worst results?
Best: PERT Estimation linked to Risk ProcessesWorst: Single point estimates
• Co-location with project teams?
Best performing teams were co-located
L6sThe Analyze Phase - Example“It requires a very unusual mind to undertake the analysis of the obvious.” – Alfred North Whitehead
Why would the sponsoring organization make a difference?
• More difficult projects?
• Change Management?
Best: Changes required formal assessment of impactWorst: Changes were assessed but impact was overridden 67%
• Strong sponsorship?
Best performing groups shared objectives for project success
No; data shows no statistical difference.
L6sThe Improve Phase - Example“This became a credo of mine...attempt the impossible in order to improve your work.” – Bette Davis
Possible Improvements1. Standardize PERT analysis with Risk Identification / Mitigation2. Co-Location of project team3. Sponsors share accountability with project managers for success4. Standardize Change Management Processes across groups
Low Impact High Impact
High Cost
Low Cost 1
2
34
Improvements to be piloted.
Pilot to execute as production for 6 months. Performance will be assessed as projects execute and complete
L6sThe Improve Phase - Example“This became a credo of mine...attempt the impossible in order to improve your work.” – Bette Davis
Pilot Results
Impact of improvements showed in time
L6sThe Improve Phase - Example“This became a credo of mine...attempt the impossible in order to improve your work.” – Bette Davis
Pilot Results
Previous Baseline 78.75% Defective
Improved Baseline16% Defective
Original Goal 50% Improvement$10.5M Benefit
Achieved Goal80% Improvement$16.8M Benefit
L6sThe Control Phase“The greatest potential for control the ends to exist at the point where action takes place. .” – Louis Allen
Purpose:• Document an approved control plan that contains all necessary items –
documentation, activities, etc. to sustain the improved performance.• Include a process monitoring capability which will prevent and/or alert
process owners should the process begin to deviate from improved performance levels.
Deliverables:• Updated process documentation with integration into existing systems• Control plan with transition to process team• Training Schedule• Next steps – further improvement recommendations, replication, etc.
L6sThe Control Phase“The greatest potential for control the ends to exist at the point where action takes place. .” – Louis Allen
Control Plan should include some kind of performance monitoring system on process variables that will alert process owners of drift.
It should also identify an appropriate reaction plan in such an event