CSUN

Engineering
Management
Six Sigma Quality
Engineering
Week 3
Define Phase
Topics


Six Sigma Project Team
Six Sigma Team Charter
Project Management
Structure of the Define Phase
Define Metrics
Problem Statement Exercise
SIOPC Analysis
Voice of the Customer Analysis
Class Exercise

Six Sigma Project Team
The team must:
Understand the organizational context for process improvement
projects
Know the basic elements of the team charter and review any
questions you have about the charter for your own project
Understand the basics of estimating the business impact of a
project and be able to relate them to your own project
Be able to identify key players and stakeholders and incorporate
them into the communication plan for your own project
Six Sigma Team Charter
A team charter is an agreement between management and the
team about what is expected.
The charter:
A project charter is a form that has key information about your
project. It is used to:
Better define your project
Define what is Critical to Quality (CTQs) to the Customer
Write a business case (links project to business goals)
Write a problem and goal statement
Scope a project
State the problem or opportunity
Establish the project goal(s)
Identify criteria for success
List assumptions, risks and obstacles
Communicate the above
Obtain management support
Six Sigma Project Charter Example
Process
Process in which opportunity exists
Project Description
Projects purpose and scope
Project Scope
Define the part of the process that will be investigated
Objectives
Define the baseline, goal & target
Business Case
Define the improvement in business performance anticipated and when
Team Members
Who are the full time team members
Expected Customer Benefits
Who is the final customer?
What benefit will they see and what are their most critical requirements?


Six Sigma Project Charter Example
Schedule
Give the key milestones/dates
Define completion date
Measure completion date
Analyze completion date
Improve completion date
Control completion date
Support required
Support needed for any special capabilities
Project Management
Problem Statement Objectives Measures
Problem Statement
Should focus the team on a process deficiency
Communicate the significance to others

Objectives
Should address the problem statement
Quantify performance improvement
Measures
Primary Metric(s)
Used to measure success
Consistent with problem statement and objectives
Secondary Metric(s)
Tracks potential negative consequences
Project Management
Project Problem Statement
A problem is the unsatisfactory result of a job or process
So what? What is the impact on the customer?
What problem or gap are you addressing?
What impact will closing the gap have on the customer?
How will you know things are better?
It should not include theories about solutions
To help give more focus on the problem, ask the following
questions:
What are the symptoms? What happens when the problem
appears?
Where do symptoms appear? Where dont they appear?
When do symptoms appear? Where dont they appear?
Who is involved? Who isnt?
Project Management
A poor problem statement
Product returns are too high and will be reduced by analyzing
first and second level pareto charts

A better problem statement
Product returns are 5% of sales resulting in a business unit
negative profit impact of $5M and reduced market share of 10%

Project Problem Statements
Project Management
Project Objectives
Should address the problem statement
Quantify performance improvement
Should also identify timing
Needs to be Measurable, Actionable and Realistic
Quality / Quantity / Time / Cost

A poor objective
Reduce product returns by implementing performance
measures and objectives

A better objective
Reduce product returns of product line abc from 5% to 2.5% by
the year end, to reduce overall returns by 1% and saving $1M


Project Management
Measures
Should be consistent with the problem statement and
objectives

Primary Metric(s) - used to measure success
Needs to include 3 series, plotted as a function of time:
Baseline performance (average over past 12 months)
Actual performance
Objective / target performance

Secondary Metric(s) - drives the right behaviour
Tracks potential negative consequences
More than one may be required
Project Name:
Estimated
completion
date
Actual
completion
date
Define Customers and Requirements (CTQs)
Develop Problem Statement, Goals and Benefits
Identify Champion, Process Owner and Team
Define Resources
Evaluate Key Organizational Support
Develop Project Plan and Milestones
Develop High Level Process Map
Define Defect, Opportunity, Unit and Metrics
Detailed Process Map of Appropriate Areas
Develop Data Collection Plan
Validate the Measurement System
Collect the Data
Begin Developing Y=f(x) Relationship
Determine Process Capability and Sigma Baseline
Met Measure Phase Criteria No
Measure
Define
Met Define Phase Criteria
Status DMAIC PROCESS AND PHASE GATE
No
Structure of the Define Phase
Define Completion Checklist
By the end of Define, you should be able to describe for your
Champion:
What key process is involved (including its Suppliers, Inputs, Outputs,
and Customers)
What about the process output is important to customers
What customers currently think of the process and its output
Why this project is important to your organization and what business
goals the project must achieve to be considered successful
Who the players are on the project (sponsors, advisors, team leader,
team members)
What limitations (budget, time, resources) have been placed on this
project
Six Sigma Problem Statements
A problem statement has the form:
WHAT is wrong
WHERE it happened
WHEN it occurred
TO WHAT EXTENT and
I KNOW THAT BECAUSE


A problem statement:
Does not include causes of the deficiency.
Does not include likely actions or solutions.
Is clear and concise and specific.
A good problem statement is essential to a good start.
What is Wrong and Where Does it
Happen?
A good problem statement will clearly define WHAT is wrong. Examples:
Customers are not satisfied with my product
Yields are suffering
Reliability is insufficient


A good problem statement will clearly define WHERE the problem occurs.
Examples:
Customers in the Midwest Region are not satisfied with my ordering service
Equipment availability for Urgent Care is poor
Document correctness is insufficient in Billing
When Was This Seen?
A good problem statement will clearly explain WHEN the
problem occurred.
Customers in the Midwest Region are not satisfied with my
ordering service. Starting in January
Equipment availability for Urgent Care is poor. Since the
consolidation of services
Document correctness is insufficient in Billing after the
introduction of flexi-forms
How Widespread is the Problem?
A good problem statement will clearly explain the EXTENT of the problem.
Customers in the Midwest Region are not satisfied with my ordering service.
Starting in January, complaints have increased 15%
Equipment availability for Urgent Care is poor. Since the consolidation of services,
delays caused by lack of availability have increased by 40%
Document correctness is insufficient in Billing after the introduction of flexi-forms.
Errors have increased 28%
What is the Standard?
A good problem statement will clearly explain HOW I KNOW there is a
problem. Examples:
Customers in the Midwest Region are not satisfied with my ordering
service. Starting in January, complaints have increased 15% at a time
when complaint rates from other regions have remained static
Equipment availability for Urgent Care is poor. Since the consolidation of
services, delays caused by lack of availability have increased by 40%
when the patient traffic has increased by only 5%
Document correctness is insufficient in Billing after the introduction of
flexi-forms. Errors have increased by 28% when the goal of the project
was to reduce errors by 90%
Primary Metric
Primary Metric (used to measure process performance)
The gage used to measure your success
It must be consistent with the problem statement. It is used to track progress
towards your goals and objectives.
It is usually reported as a time series graph of:
Baseline data averaged over a year, if available
Target performance goal or objective
Actual (current) performance
Examples:
Rolled throughput yield (RTY) [versus FTY]
Process Sigma Level or Ppk
Defects per unit (DPU) [versus Proportion Defective]
The Primary Metric is how the success of your project will be measured
Sample Primary Metric
Product Returns
0%
1%
2%
3%
4%
5%
6%
7%
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A
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$

Baseline
Actual
Objective
Secondary Metrics
Secondary Metrics:
Measurements of key input/output features, cycle time, or process resource usage
that may improve as a result of meeting objectives using the primary metric
Can be Drivers or Riders i.e. Vital Xs impacting the project (Primary Metric) or
Good Consequential Metrics

Examples:
Primary Metric : Cycle Time
Secondary Metric : Reduced backorders

Primary Metric : Defects per Unit
Secondary Metric : Available Floor Space
Sample Secondary Metric
Pct of Orders Shipped within 24 hours
90%
91%
92%
93%
94%
95%
96%
97%
98%
99%
100%
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Problem Statements Exercise
Break out into your groups. Using the guidelines of this module,
each group will rewrite these problems statements to make
them better:
The complaint rate for our customer service group is too high,
probably due to all of the new people in the department.
Food Services order errors are too high. They must be reduced.
Reduce measurement errors by cleaning the instruments more
often.
Consumable use is increasing too fast. Reduce consumable cost.
Long term rolled throughput yield for Accounts Payable billing this
year is 83% versus a past RTY of 95%.
Long wait time for phone service. It takes customers about 30
minutes to get an order completed.
What is a SIPOC?



A high-level map of your process that includes:
Approximately 4-7 process steps
Inputs that feed the process
The Suppliers (sources) of those Inputs
Outputs that result from the process
The Customers (recipients) of those Outputs

Keep it simple, and think carefully about the scope
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Outputs Inputs Process
Why Create a SIPOC Map?
SIPOC helps your team to:
Define process boundaries (starting and ending points)
Identify data collection opportunities
Clarify who are the true customers of the process

To avoid scope creep.

To identify likely sources of performance problems

To expose fundamental issues early in the project that could
change the direction of the team

When to Create a SIPOC
All work can and should be considered as a process

In the Early Stage of Any Project!
Ideas
Process Information
Questions to Help with SIPOC
From the Output/Customer End:
Why does this process exist?
What products, services or
outcomes does this process
produce?
How does this process end?
Who uses the outputs or
experiences the results from this
process?
Who provides funding or staffing for
the process activities, and who
cares about the quality of outcome?
From the Input/Supplier End:
What items or information gets
worked on?
Where do the items or information
come from?
What effect do the inputs have on
the process and on the outcome?
How does this process start?
From the Middle Inside the Process:
What major steps happen to convert
inputs into outputs?
What people or resources perform
those steps?
SIPOC - Process Development
Example
CUSTOMERS OUTPUTS PROCESS INPUTS SUPPLIERS
NEUTROGENA CORPORATION
Green Belt Project- Line Trial Anytime
SIPOC
Industrial Ingineering
Maintenance
Warehouse
Package Development
Quality Assurance
Scheduling
Routing
Cost Estimate
Change Parts
Specs
B.O.M.
Protocol
LINE
TRIAL
EXECUTION
Create/Deliver
Protocol
Deliver Supplies/
Change Parts
Line Set Up/Fine
Tune
Contact Line Trial
Team
Fill Product
Deliver Samples/
Documentation
START STOP
Stability Samples
Validate Change Parts
Validate Fill Process
Validate Cost
Quality Validation
R&D
MFG
Package Dev
I.E.
QA
Suppliers Material
Labor
SIPOC Workshop
Instructions:
Prepare a SIPOC for the process of baking your cake. Use the
guidelines on the following page.

Be prepared to share your work with the class.
15 minutes to prepare + 2 presentations (5 minutes each)


How to Create a SIPOC Map
Name the process

Identify, name, and order the major process steps (approximately 4-7
steps)

Clarify the boundaries of the process where it starts and where it
stops

List key outputs and customers

List key inputs and suppliers

SIPOC a Foundation for Next Steps
The list of Customers from your SIPOC are the starting point for the Voice of
the Customer (step 3)

The major process steps (macro map) from your SIPOC are the overview for
later detailed process mapping

The Inputs, Process Steps, and Outputs on your SIPOC generates ideas for
what can and should be measured, which feeds the Data Collection Plan in
the Measure phase

The SIPOC contains clues about potential root causes that drive performance.

Voice of Customer
Understand why the Voice of the Customer (VOC) is critical
Know how to create a plan for gathering VOC data
Know both reactive and proactive ways to gather VOC
information
Know how to analyze data through the use of affinity diagrams
and Kano diagrams
Be able to use a CTQ tree diagram to identify customer
requirements and set specifications for them

What Is the Voice of the Customer?
The term Voice of the Customer (VOC) is used to describe
customers needs in a process improvement effort and their
perceptions of your product or service.
Why VOC Is Critical
VOC data helps an organization and a project to:
Decide what products and services to offer
Identify critical features and specifications for those products,
process outputs and services
Decide where to focus improvement efforts
Get a baseline measure of customer satisfaction to measure
improvement against
Identify key drivers of customer satisfaction
Why Collect VOC Data

Customer requirements change constantly

Specifications tend to focus on technical data only
VOC Process
Outcomes
A list of customers and customer segments
Identification of relevant reactive and proactive sources
of data
Verbal or numerical data that identify customer needs
Defined Critical to Quality requirements (CTQ)
Specifications for each CTQ
Based on Rath & Strong
1.
Identify
customers
and determine
what you need
to know
2.
Collect and
analyze
reactive
system data
then fill gaps
with proactive
approaches
3.
Analyze data
to generate
a key list
of customer
needs in
their language
4.
Translate
the customer
language
into CTQs
5.
Set
specifications
for CTQs
VOC Step 1: Identify Customers & Determine What You
Need to Know
Goal
Identify your customers
Decide what you need to know about their needs
Decide when and how you will get this information

1.
Identify
customers
and determine
what you need
to know
2.
Collect and
analyze
reactive
system data
then fill gaps
with proactive
approaches
3.
Analyze data
to generate
a key list
of customer
needs in
their language
4.
Translate
the customer
language
into CTQs
5.
Set
specifications
for CTQs
Who Are Your Customers?









What are the outputs of your process? Who are the customers
of that output?
Are there particular groups of customers whose needs are
especially important to your organization and project success?
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Outputs Inputs Process
AB-588.2
Common Customer Segments
Customer status: Former Customers, Current Customers,
Customers of Competitors, Substitute Customers
Where they are in the customer chain
Internal user Distributor End user
Geography
Industry, Division or Department
Demographics
Do You Have Customer Segments?

If your customers seem to have similar needs across the
board, you dont necessarily have to divide them into
segments

If you suspect that different groups will have significantly
different needs, and that these differences will influence
how you structure your process, product, or service, then
it will be worthwhile to think in terms of segments
Deciding the What and Why
Revisit your charterwhat is the purpose of your project?
How does your purpose relate to customer needs?
What do you need to know about the needs of the customers youve
identified to make sure your projects purpose stays on track?
Sample Questions
For all customers, you should ask questions such as:
1. What is important to you about our process/product/service? (Ask them to
rank each of these needs in order of importance.)
2. What do you think of as a defect?
3. How are we performing on the areas you consider important?
4. What do you like about our product/service?
5. What can we improve about our process/product/service?
What can we do to make your job easier?
6. What specific recommendations would you make to us?

VOC Step 2: Collect and Analyze Reactive and Proactive Data
1.
Identify
customers
and determine
what you need
to know
2.
Collect and
analyze
reactive
system data
then fill gaps
with proactive
approaches
3.
Analyze data
to generate
a key list
of customer
needs in
their language
4.
Translate
the customer
language
into CTQs
5.
Set
specifications
for CTQs
Reactive systems
Information comes to you whether you take action or not

Proactive systems
You need to put effort into gathering the information
Typical Reactive Systems
Customer complaints (phone or written)
Problem or service hot lines
Technical support calls
Customer service calls
Claims, credits, contested payments
Sales reporting
Product return information
Warranty claims
Web page activity

Reactive systems generally gather data on:
Current and former customer issues or problems
Current and former customers unmet needs
Current and former customers interest in particular products, process outputs or services
Proactive VOC Systems
Interviews
Focus groups
Surveys
Comment cards
Data gathering during sales visits or calls
Direct customer observation
Market research, market monitoring
Benchmarking
Quality scorecards
VOC Plan: Final Touches
The last step to finishing your data collection is to decide
specifically how you will obtain the information, within what time
frame the data gathering should take place, and how you will
record the data

VOC Step 3: Analyzing Customer Data







Goal is to generate a list of key customer needs in their language.
It is helpful to summarize this information in a meaningful way.
1.
Identify
customers
and determine
what you need
to know
2.
Collect and
analyze
reactive
system data
then fill gaps
with proactive
approaches
3.
Analyze data
to generate
a key list
of customer
needs in
their language
4.
Translate
the customer
language
into CTQs
5.
Set
specifications
for CTQs
Questions? Comments?