Six-Sigma Green Belt Part 2

Front 1

Process Lead Time (PLT)

Back 1

The time from release of a product into a process until its completion
Example: The elapsed time from when a homeowner calls, to when the mortgage refinancing closes averages 33 days.

Front 2

Work-In-Process (WIP):

Back 2

): Product that is within the boundaries of the process
Example: There were 3300 refinance applications in process at the end of the month.

Front 3

Exit Rate (Throughput)

Back 3

The output of a process over a defined period of time. It’s a rate.
Example: Our process closed 100 mortgage refinance applications per day last month

Front 4

Little’s Law

Back 4

PLT = WIP/Exit Rate

Front 5

Process Cycle Efficiency (PCE)

Back 5

PCE is a measure of the relative efficiency in a process – it represents the percentage of value add time (changing form, fit, function) of a product along the critical path.
It is calculated using:

Process Cycle Efficiency = (Customer Value Add Time/PLT)*100

Front 6

Benefits of a Work Control System

Back 6

The primary goals of a work control system are to stabilize then reduce process lead time and lead time variability

Front 7

Foundation for Lean Improvements

Back 7

Lean seeks to reduce process lead time.
o To reduce Process Lead Time, you either have to increase Exit Rate or reduce Work In Process – both require process improvements to improve process parameters
o To reduce Process Lead Time, first investigate the relationship between process parameters like setup time, scrap, downtime, etc. and Work in Process
o Then, for a given amount of demand per part, we can calculate the optimum amount of Work In Process needed to minimize the Process Lead Time
☺ Then we can…
o Find the part of the process that introduces the most time delay, in order to reduce Process Lead Time

Front 8

Work Control Systems

Back 8

The primary goals of a work control system are to stabilize then reduce process lead time and lead time variability

Fundamental Principle – Start Rate = Exit Rate

Fixed WIP Improves Flexibility

Front 9

How to Size a Work Control System:
Step 1. Determine current Process Lead Time (PLT)

Back 9

PLT = minute, hour day
WIP is the Stuff
ER = Qty output by time

PLT=WIP/ER or

PLT x ER = WIP or

ER = WIP/PLT

Front 10

Step 2. Determine current Process Cycle Efficiency (PCE):

Back 10

PCE% = Customer Value Add Time/PLT x (100)

Front 11

How to Size a Work Control System
Step 3. Identify appropriate target PCE

Back 11

Rules of Thumb:
If current PCE is << Low End Target, multiply current PCE by 10 (one order of magnitude improvement) for use as Target to be conservative.
If current PCE is < Low End Target, use Low End as Target PCE
If current PCE @ or > Low End Target, use High End as Target PCE

Front 12

How to Size a Work Control System
Step 4. Calculate theoretical best PLT

Back 12

PLTtb = CVA TIme/Target PCE

Front 13

How to Size a Work Control System
Step 5 Calculate WIP cap

Back 13

The WIP Cap…determines the maximum WIP allowed within the process at any time. It is measured as:
WIP Cap = PLTtb x ER

Front 14

Different Formulas used in sizing a work control system

Back 14

PLT = WIP/ER, also CVA/PCE
ER = WIP/PLT
PCE = CVA/PLT
WIP = PLT*ER
PLTTB = CVA/Target PCE
WIPCAP = PLTTB * ER

Front 15

Value of Speed & Work Control Systems

Back 15

Primary Goal is to stabilize then reduce process lead time and lead time variability
Benefit is a more manageable process with controllable WIP levels

Front 16

Quick Improvement – 5S

Back 16

Sort
Set in Order
Shine
Standardize
Sustain

Front 17

5S - Sort

Back 17

Sort means that you remove all items from the workplace that are not needed for current tasks.

Front 18

5S - Sit in Order

Back 18

arrange the items that are needed in the area and identify them or label them so that anyone can find them or put them away.

Front 19

Change Reduction

Back 19

Document the Set-up and seperate into serial and parallel events.
-Serial event – an activity that cannot (or should not) be performed while any other task is being completed
-Parallel event - is an activity that could be performed while another task is being completed
Convert Serial events to parallel.
Streamline remaining serial events
Eliminate adjustments

Front 20

Brainstorming

Back 20

Brainstorming is a structured method of generating unconstrained ideas/solutions and gaining engagement/involvement in the improvement process.
Brainstorming produces many ideas/solutions in a
short time.
Brainstorming facilitates the creative thinking process.

Front 21

Affinity

Back 21

A tool for organizing facts, opinions and issues into natural groups as an aid to diagnosing a complex problem
Helpful when a breakthrough is needed
Helps organize ideas, concepts and/or facts
Allows the development of central themes

Front 22

Cause & Effect (C&E)

Back 22

Represents the relationship between an effect (problem) and its potential causes. Categorizes causes.
Helps ensure that a balanced list of ideas have been generated during brainstorming.
Helps us overcome the “theme” or “group think” effect.
When you have identified major causes, ask “Why?” five times to develop more detailed causes

Front 23

Nominal Group Technique (NGT)

Back 23

NGT supplements brainstorming. It is a structured approach to generate additional ideas, survey the opinions of a small group, and prioritize brainstormed ideas
Structured to focus on problems, not people; to open lines of communication; tolerate conflicting ideas
Builds consensus and commitment to the final result. Especially good for highly controversial issues.

Front 24

Force Field Analysis

Back 24

A tool to help a team understand the forces that keep things the way they are so it can make change possible
Forces creative thinking focused on the issues of change
List all of the driving forces (direct movement toward a goal) and all the restraining forces (block movement toward a goal).
Establish a plan to eliminate or diminish some or all of the restraining forces

Front 25

C&E Matrix

Back 25

The C&E matrix is a team tool used to focus in on the process steps and/or inputs that potentially have the greatest effects on CCRs.
Customer requirements are ranked by order of importance and then inputs and outputs are rated by their interaction impact.
Numbers show strength of relationship between step/input and CCR.
blank = no correlation
1 = remote correlation
3 = moderate correlation
9 = strong correlation
Note: When matrix is complete 50-60% of cells should be blank.
Totals show importance of each step/input. Use these numbers to focus on most important steps/inputs

Front 26

Hypotheses Testing

Back 26

A sample is taken to make inferences about a population when it is not practical or possible to measure/query every item/person in the population.

In order to make those inferences, the sample must be representative of the population.

Confidence Intervals for a sample statistic define the range of values in which we can expect to find the population parameter at a given Confidence Level. (e.g. When we specify a 95% Confidence Level, we are 95% confident that the population mean, also known as a parameter, falls within the confidence interval about a sample mean.)

Front 27

Null Hypothesis (Ho) & Alternative (Ha)

Back 27

(H0) is a statement we assume is “true” unless we have enough evidence to prove otherwise
If we cannot prove otherwise, then we fail to reject the null hypothesis
If we can prove otherwise, then we reject the null hypothesis and accept the alternative hypothesis (Ha)
How will we know if Ho is likely to be true?
If the p-value is less than or equal to a pre-selected level of significance (a - level), then we reject Ho and accept Ha.
If the p-value is greater than the a - level, then we fail to reject Ho and cannot support Ha.
“If P is low then H0 must go!”
The p-value is the probability we are wrong if we reject the Ho(null hypothesis

Front 28

Contingency Table

Back 28

The two categorical variables are usually a Y and an X, but not always. Can be two Y’s, two X’s, etc. However, they must be discrete.
Contingency Analysis is used to test the association between a discrete “X” and a discrete “Y

Front 29

Analysis of Variance (ANOVA):

Back 29

is a statistical method for comparing the means of three or more levels of a discrete factor (X). In our case the factor is the site, i.e., PR05, Sesto, etc

Front 30

Process Flow Improvement:

Back 30

Process Flow Improvement follows a definite path that includes decision criteria to identify both the appropriate process improvement tool to apply, and when.
If the current process capacity is unable to meet customer demand, then the constraint operation must be identified and eliminated as a capacity constraint.
If the process is simply unbalanced (different workloads for different steps), then it needs to be balanced.

Front 31

Time Trap

Back 31

The process step that inserts the most delay in to the process.
Example: Our sample preparation group prepares 120 samples per day, all other process steps can process 145 samples per day

Front 32

Constraint

Back 32

A process step that is unable to produce at the exit rate required to meet customer demand (internal or external

Front 33

Process Flow Improvement Hierarchy

Back 33

Process is not meeting customer demand
Use process constraint identification
Process is meeting customer demand, but the tasks/work loads are not balanced
Use process balancing
Tasks are balanced, but there is too much movement of information/material
Use CVA / BVA / NVA analysis
Process has limited movement, but has too much NVA time
Use CVA / BVA / NVA analysis

Front 34

Lean improvement in ‘DMAICV’

Back 34

Document and measure the process (D,M)
Analyze the process for improvement (A)
Apply process flow improvement techniques (I)
Standardize Operations (C)

Front 35

Solution Generation

Back 35

We’ll use this process to generate Great solutions:
Step 1 – Generate Solution Ideas
Step 2 – Reduce the List of Potential Solutions and Develop Solution Concepts
Step 3 – Evaluate and Prioritize Solution Concepts against established Criteria (use your CCRs and CBRs);
and
Step 4 – Tie Together: Synthesize Better Solution Concepts and Iterate

Front 36

Analytical Hierarchy Process (AHP)

Back 36

AHP has many uses, but is most effective in determining the relative importance of evaluation criteria
It converts subjective assessments of relative importance into a set of overall scores or weights
The fundamental input to the AHP is the team’s answers to a series of questions of the general form, “How important is criterion A relative to criterion B?”

Front 37

PUGH- Weight the Evaluation Criteria based on importance

Back 37

Using a numeric scale (often 1 to 5, but it doesn’t matter), rank the criteria in terms of relative importance
Good opportunity to utilize pair wise comparisons and the Analytical Hierarchy Process to determine weights for the evaluation criteria
Be sure to discuss the criteria and the weighting with the sponsor – if you agree in the criteria and weighting, you should agree on the result.

Front 38

PUGH- Prepare Evaluation matrix

Back 38

Compare each of the alternatives against the BASELINE

Front 39

Random Word

Back 39

This technique helps teams approach problems from different perspectives rather than through patterned ways of thinking

Front 40

20 Questions

Back 40

Useful to “tear apart” an existing process or service and challenge all current assumptions prior to developing the next generation

Front 41

Process Balancing

Back 41

Process Balancing” is a procedure whereby a set of process steps are “equalized” in terms of time required to accomplish them

Front 42

Process Flow Improvement Decision Hierarchy

Back 42

Process is not meeting customer demand
Use process constraint identification
2. Process is meeting customer demand, but the tasks/work loads are not balanced
Use process balancing
3. Tasks are balanced, but there is too much movement of information/material
Use CVA / BVA / NVA analysis
4. Process has limited movement, but has too much NVA time
Use CVA / BVA / NVA analysis

Front 43

Process Flow Hierarchy key Item

Back 43

Remember, CVA / BVA / NVA analysis
is a part of EVERY Lean process improvement

Front 44

GREaT solutions

Back 44

Step 1 – Generate Solution Ideas
Step 2 – Reduce the List of Potential Solutions and Develop Solution Concepts
Step 3 – Evaluate and Prioritize Solution Concepts against established Criteria (use your CCRs and CBRs);
and
Step 4 – Tie Together: Synthesize Better Solution Concepts and Iterate

Front 45

Mistake Proofing

Back 45

• A method which makes it very difficult or impossible to produce defective work

Front 46

FMEA (Failure Modes and Effects Analysis)

Back 46

Examine the implications of a solution or redesigned process
Plan for unintended consequences related to your solution before you implement or promote it.

Front 47

Steps of a Pilot

Back 47

Conduct a Design Review
Set the Pilot Plan and Timeline
Prepare All Stakeholders
Run the Pilot
Summarize the Pilot Conclusions

Front 48

Project Risk management

Back 48

Project Risk Management is a comprehensive
means to proactively Identify, Assess,
and Mitigate the risks related to your project

Front 49

Project Risk Elements

Back 49

Project Risk Management consists of four primary elements:
Initial Risk Analysis: Risks related to successful project completion (schedule and results)
Business Risk Management: Potential risks resulting from the planned solution and implementation plan on the business and its customers
Organizational Acceptance Risk Management: Risks related to lack of cultural buy-in for the proposed solution and implementation
Sustainment Risk Management: Risks related to sustaining the project gains over the long-term