Professional Documents
Culture Documents
1
General Introduction
Benefits of 6 Sigma
2
Objectives of Black Belt training
3
Why 6 Sigma in our organization?
4
Benefits of 6 Sigma
When the principles and methodologies of Six Sigma are properly applied in
a business process, they return positive top line & bottom-line results.
5
Introduction to Quality
Fundamental Principles
Quality Concepts
6
Aim So High…
You’ll Never Be Bored…
The greatest waste of our natural resources
is the number of people who never achieve
their potential.
Get out of that slow lane. Shift into that fast
lane
Knowledge Skills
If you think you can’t, you won’t. If you
think you can there’s a good chance you
will.
Even making the effort will make you feel Attitude
Habit
like a new person.
Reputations are made by searching for
things that can’t be done and doing them.
7
Moving up the competency ladder
Unconsciously
Competent
1. Unconsciously Incompetent
2. Consciously Incompetent Consciously
Competent
3. Consciously Competent
4. Unconsciously Competent Consciously
Incompetent
4
Unconsciously
Incompetent
8
Quality Concepts
Quality
Simply stated, quality comes from meeting customer expectations. This
occurs as a result of four activities:
9
Importance of Quality
In short In short
BETTER QUALITY = HIGH COST BETTER QUALITY = LOW COST
10
Quality’s contribution to Profitability
Price
External
Product Quality
•Reduced Scrap Productivity
•Improved customer
Response time
•Decreased
•Cycle time Internal Profit
•Elimination of setup time
Process Quality
•Reduced Rework
•Elimination of in Cost
process Opportunity for
•inspection profit
Organization
11
Typical Waste….
Wastes of Manufacturing Process Wastes of Service Industry
• Defects
• Defects
--- rework
• Waiting
• Unsatisfied Customer
• Processing
---Customer not satisfied, wrong input
• Over production • Under-utilization of Resources
• Motion --- Poor usage of infrastructure , manpower
• Inventory • Over- Processing
• Transportation --- Over-support to customer ,unwanted information
• Redundant Process steps
• Under-utilization
--- Wrong processes / methods
• Safety hazards
12
Cost of Poor Quality
Inspection
Traditional Quality Costs
Warranty
(Easily Identified)
Rejects 4~ 6% of Sales
Rework
(tangible)
(tangible)
Scrap
Lost sales
Expediting costs
13
Cost of Poor Quality (COPQ)?
14
Cost of Quality Categories
Internal Failure Costs
- costs that would disappear if no defects existed in the product
prior to shipment to the customer.
Appraisal Costs
- costs incurred to discover the condition of the product (during “first
pass through”).
Prevention Costs
- costs incurred to keep failure and appraisal costs to a minimum.
15
Internal Failure Costs
Before shipment to customer
Examples
• Scrap (labor and material)
• Rework
• Retest / Recheck/ Re-inspection / Re-testing
• Productivity loss due to defects
• Excess inventories
• Failure analysis
• 100% sorting inspection
16
External Failure Costs
After shipment to customer
Examples
• Lost business
• Warranty
• Dealing with complaints
• Returned product
• Price concessions due to lower
grade product
17
Appraisal Costs
Examples
18
Prevention Costs
Examples
• Maintaining production/operations equipment
• Process Control & Capability evaluation
• Process improvement:
-Error proofing
-FMEA
-DOE
• Training
19
Evolution of Quality
Each Phase Built on the Structure and Gains From the Previous Phases
20
DEMING’S Philosophy
21
Deming’s 14 points for Quality Management
(Principles of transformation)
1. Create constancy of purpose for continual improvement of product and
service. : Replace short-term reaction with long-term planning.
6. Institute training on the job. : If people are inadequately trained, they will
not all work the same way, and this will introduce variation.
22
Deming’s 14 points for Quality Management
7. Adopt and institute modern methods of supervision and leadership.
23
Deming’s 14 points for Quality Management
12. Remove barriers that rob the hourly worker of the right to pride in
workmanship. : Many of the other problems outlined reduce worker
satisfaction.
24
Introduction to Six Sigma
25
Introduction to 6 Sigma
Success Stories
6 Sigma : Meaning
6 Sigma : Benefits
26
Six Sigma History
27
Motorola And the Results?
1997
5.6σ ~ 16Billion
Products Manufactured
1986
4.2σ In 1988 Bob Galvin (CEO Motorola) while accepting
first “Malcom Baldrige National Quality Award ” for
Motorola, described about something called as Six
Sigma.
28
Six Sigma History
Since then, hundreds of companies around the world have adopted Six Sigma
as a way of doing business.
29
Success stories - General Electric
General Electric’s, Jack Welch describes Six
Sigma as the most important initiative GE has ever
undertaken. GE had an operative income of 10%
for decades and they were not able to improve this
despite various efforts. After implementation of Six
Sigma GE was able to improve its operative
income from 10% in 1995 to 16.7% in 1998.
30
Asea Brown Boveri
31
Allied Signal
32
A Six Sigma Journey • • 1987 to 2006
Over the past few decades six sigma has evolved from a
focus on defects to cost reduction to value creation.
33
Companies Implemented 6 Sigma
-Worldwide
Black and Decker
Dupont Kodak
Sony Microsoft
GE Allied Signal
Motorola
Corporation Toshiba
Johnson Controls
Ford Caterpillar
34
Definition & Drivers
6 Sigma
• A comprehensive and flexible system for achieving, sustaining
and maximizing business success
6 Sigma Drivers
• Close understanding of customer needs
• Disciplined use of facts, data, and statistical analysis
• Diligent attention to managing, improving, and reinventing
business processes
The Goal of Six Sigma is not to achieve six sigma levels of quality. It is about
improving profitability, though improved quality and efficiency are the immediate
by-products of Six Sigma.
35
Definition of Quality as per Six Sigma
36
6 Sigma : What Makes It Different?
• Six Sigma metric provides a standard for communicating process status and
improvement goals.
37
Six Sigma v/s TQM and ISO
ISO TQM Six Sigma
Focus on Money
Continuous Improvement
Performance Targets
Functional Focus
Project Approach
38
6 Sigma: Meaning
• Reduce Variation to the half of Tolerance Band
• Minimize defects to the level of 3.4 defects per million opportunities
6σ Definition
6 It is a metric that
indicates how well the
monitored business Six sigma tool tries to LSL USL
reduce variation in the
process performs.
process and shifts
Higher the no., better process mean
the process. towards the target
39
Example 1
42
41 40
40
39
38
37
36 LSL
35
1 2 3 4 5 6 7 8 9 10
Order no.
40
Time taken to procees order - Advisor B
USL
45
44
43 Process mean is 40
Time in Minutes
42
41 40
40
39
38
37
36 LSL
35
1 2 3 4 5 6 7 8 9 10
Order no
41
Time taken to process order - Advisor A & B
USL
45
44
43
Time in Minutes
42
41
40
40 B
39
38
37
36 A
LSL
35
1 2 3 4 5 6 7 8 9 10
Order no
20
Influence of 6 Sigma
10
0
0 10 20 30 40 50
Process before and after Six Sigma
43
A Six Sigma Landing .
Target USL
LSL
44
Consider 10,00,000 (1
Million) planes take off
Understanding per year. The plane
Sigma Level crash results…at each
Sigma Level will be as
follows
year
year
45
Sigma Level and Quality
2 308,507 31 %
3 66,807 7%
4 6,210 0.6 %
5 233 0.02%
6 3.4 0.00034%
46
Six Sigma Process
Predictably twice as good as what the customer wants
6σ
−6σ + 6σ USL
LSL
3σ
1σ 1σ 1σ 1σ 1σ 1σ
1 2 3 4 5 6 7 8 9 10 11 12
47
Sigma –
LSL USL
One standard deviation around the mean is about 31% of the total
“opportunities” included with in specification limit.
48
If we can fit six standard deviations on both side of the mean
in between our target and the specification limits . . .
LSL USL
6 5 4 3 2 1 1 2 3 4 5 6
6 Std. Dev. / 6 Sigma
….. then
99.99966% of our “opportunities” are included!
49
6 Sigma : Benefits
• Cost reduction
Y = f(X)
Focus of the 6σ
Approach of
Which one should we focus on the Y or X? Problem solving
Y X1,.…,Xn
■ Dependent Function ■ Independent Variable
■ Output ■ Input
■ Effect ■ Cause
■ Symptom ■ Problem
■ Monitor ■ Control object
Or
52
Y = f (X)
53
Pr = f (V)
54
V=E-O
55
Continual Improvement
Continual
Performa Improvement
nce 6σ / ISO /
act plan COPC
act do / e-SCM
check do Performance
check do Management
System
Assura
nce
Time
56
Six Sigma
Organization, Roles and
Responsibilities
57
Six Sigma Organization
Six Sigma focuses on reducing the variation in every
process , makes intensive use of the statistical tools,
enables decisions based on facts & data rather than gut
feelings and puts customer in first place .
Every improvement we are doing in house must be
ultimately linked with the customer satisfaction whether it
is internal or external . There must be strong and clear
linkages between the internal processes, which ensures
the end customer satisfaction .
To transform our organization into Six Sigma
organization , we must ensure that six sigma is used as a
philosophy / strategy and not a tool .
In an essence , It's a new way of managing the
6 Sigma : The Organization
Leadership
Commitment at
Executive
Level
Governance
Review,Enable,Monitor,Institutionalise
e.g. Quality leaders, Master Black Belts etc.
Implementation
Scope, Apply Six Sigma Tools And Enhance Business
Processes
e.g. Project sponsors, BU Managers, BB, GB, YB – who
apply Six Sigma on-the-job
59
Ispat Industries Ltd. Six Sigma Deployment Process
Six Sigma Deployment Model
Creat a
Champion / Top
core six
Management
Deployment
Evaluate Design a
Define a
Design Define a Establish cultural common Compile the
core team
Identify Appreciate
Review the Ensure
BU Managers
appropriate and
Identify Ensure team controls are
project recognize
opportunities resource progress, in place and
leaders & good
for availability remove project
arrive at efforrts.
breakthrough for project barriers and gains are
cross Motivate
improvement execution resolve sustained
functional project
issues forever .
team team
Belt / Project Team
Black Belt / Green
DEFINE CONTROL
MEASURE ANALYZE IMPROVE
the project. the KPIV's
the the negative peroformance
Pboblem to sustain
response effect. ( Y's) by
statement, improved Y.
variable Y. Identify root implementing
Objective, Control
Baseline, causes(X's) the counter
Scope, plan,
Target, & verify solutions for
Team, Control
MSA statisticaly X's
Timeline chart etc..
60
Organization / Infrastructure
Sponsor Senior executive who sponsors the overall Six Sigma Initiative and who is
responsible for implementing Six Sigma within the business. Select meaningful
business impact projects. Responsible for achieving Six Sigma project results.
Identify, prioritize, select & scope projects. Review, track, and report Six Sigma
project progress and results. Eliminate project barriers, assure proper project
resources. Reward, recognize Six Sigma project team
Achievements.
Master Black Mentor black belts on their projects. Ensures effective application of DMAIC.
Belt Coach on appropriate, effective use of Six Sigma Tools & effective project
management to achieve on-time results. Helps sponsor in improvement
opportunity identification. Apply Six Sigma skills and expertise to their own
Projects. Train BBs, Sponsors and Managers in Six Sigma.
Black Belt Highly experienced person with four weeks of classroom training, has
managed several projects and is an expert in Six Sigma methods / tools.
Organize, plan and lead Six Sigma projects. Escalates project barriers to
sponsors. Project tracking, reporting. Apply Six Sigma skills and expertise to
project execution. Responsible for coaching / mentoring / training Green and
Yellow Belts, team members and for helping the Sponsor keep the initiative
on track
61
Organization / Infrastructure
Project leader Understand DMAIC Process and Sustain Improvements. Provide domain /
Process expertise. Accountable for timely completion of projects. Support
improvements. Identifies project team and ensures their availability.
Green Belt Professional who leads small scope Six Sigma projects. Typically has
one week of classroom training in methods, statistical tools, and (sometimes)
team skills, participates in Black Belt project team or leads smaller projects.
Yellow Belt Typically has two days of classroom training in methods and basic statistical
tools, participates on a Green Belt project team or leads smaller improvement
projects.
Team Member Professional who has general awareness of Six Sigma. (through no formal
training) and who brings relevant experience or expertise to a particular project.
Apply Six Sigma tools with help of Black / Green / Yellow Belts Contribute ideas
during meetings and carry out action items. Collect and analyze data
Lead small activities such as process capability studies, measurement system
studies, verifying causes and solutions. Implement and sustain solutions.
62
Six sigma Roles
Black Belt Green Belt Team Members
• Organize, plan & lead Six Sigma • Participates in Black Belt • Bring expertise to projects
projects project team. • Contribute ideas during meetings
• Project barrier escalation to • Leads smaller projects and carry out action items
sponsors • Collect and analyze data
• Project tracking & reporting • Lead small activities
coaching / mentoring / training
Yellow Belt • Implement & sustain
• Leads smaller improvement
Green & Yellow Belts, team solutions
projects
members
65
Black Belt
Requirements Responsibilities
• Statistical Knowledge At Start:
essential • Select Team Members
• Prepare Project Charter
• Experience in Data Collection, • Identify Ys
Analysis & Interpretation
required On Going:
• Should posses Leadership • Analyze Ys & compute Baseline Sigma Value
Qualities • Identify Xs
• Establish relationships between Ys & Xs
• Should posses Good • Optimize Xs
Communication Skills • Devise Control Mechanism to ensure that Xs
are at optimum always.
At End:
• Be equivalent to Master Black Belt.
• Conducts programs on Statistical tools
• Facilitates Business Unit Head for project
selection
66
Green Belts \ Team Members
Responsibilities
On Going:
Collect data on Ys
Help BB to analyze Ys data.
Be part of identifying Xs
Collect data on Xs
Help BB to establish relationship between Xs &Ys
Help BB to optimize & control Xs
Help design the new process
Drive the project to completion
At End:
* Green Belt will be equivalent to Black Belt
67
Team Members
68
Project Teams
G
Champion
Black Belt
B
Green Belt
G G
Team Members
69
Team Dynamics
Accountability
Skills
Performance
Problem Solving Mutual Accountability
Results
Technical/ Small group of people
Functional
Individual Accountability
Interpersonal
C
dge t Wo ollec
wle en rk t
Pro ive
no cem du
K an ct
h
En
Specific Goals
Common Approach
Meaningful Purpose
Commitment
70
Deployment Strategy
Role Matrix
Training
Certification Criteria
Project Classification
71
Elements of 6 Sigma Deployment
1.Project Identification - Six Sigma is being
To contribute to the bottom-line implemented in the
of the organization, client
satisfaction, etc organization as a catalyst
2. Project for change in culture and
6. Fostering Quality Classification
Culture
achieve competitive
•Branding •Black Belt Project advantage.
• Yearly Awards •Green Belt Project
•dedicated facilities •Yellow Belt Projects
and staff Top DMAIC methodology is
Management being used to develop and
5. Project Benefits
Evaluation
Commitment 3.Enhanced Training
fine tune both core and
and certification
Project Benefits (QNI) = enabling processes.
Project Savings – •Awareness Program
Project Expenditure •Yellow Belt Training
4. Review •Green Belt Training
Six Sigma Deployment plan
•Black Belt Training
Mechanisms
is properly documented as
•Program Reviews
•Project Reviews
PACE guidelines.
Project Certification √
73
Types of Training
Awareness Program – The program will be of a 4 Hrs duration.
This is engagement specific and will be conducted internally by the
dedicated certified trainer.
Qualifying mark would be 70% for YB, 75% for GB & 80% for BB
75
Certification Criteria OPTIONS
1 2 3 4 5
Black Belt
Certification
Green Belt
Certification
76
Project Classification Green Belt Black Belt
IMPACT
Yellow Belt X
Complexity
Hard (Tangible)
Benefits Definition: Any measurable
Improvement which can be Quantified
and converted into Dollar Savings.
Soft
Examples:
(Intangible) • Reduction of 3 FTE’s
Benefits • 1% market share Increase
• Eliminate 2 Temporary Positions
Definition: Any measurable • Rework down 20%
Improvement • Lower vendor cost per transaction
which cannot be quantified and • Save 1 temp. worker 2 hrs of work
converted per week
into Dollar Savings. • Eliminate 30% call volume
• Decrease AHT of the process by 60
Examples: secs
• Increase Customer Satisfaction • Reduction in past due receivables
Scores by $10MM
• Improve VOC Scores
Project Benefits (QNI) = Project Savings – Project Expenditure
• Improving Federal
1. Project Charter will include/ State regulatory
Sign-off from Finance Analyst
Compliance Scores
2. Project validation / authentication is done by Sponsor, Head Quality and Finance Dept. The
return on the project is verified.
3. Only upon successful completion of the project, the respective BB will be eligible for
certification. 78
Six Sigma
Project Identification and
Selection
79
Project Identification & Selection
Kano Model
CTQ Tree
80
Project Selection Approach
Steps
81
SS Project Selection Approach – Identifying Critical processes
Approach Steps Tools Approach Description
Business Process
Framework One of the Business / Functional unit (e.g. Operations /
Business
Business Unit Purchase
Customer Step I Step II Step III Step IV Step V Step VI Step VII
Surveys
Identify
Identify Critical
Critical Process
Process
Brain storming
Prioritization
Study the critical process and the pain areas identified
Study Process
Process during customer survey
High level
process mapping
List
List out
out Customer
Customer
Expectations/Deliverables
Expectations/Deliverables SIPOC Categorize the customer expectations (VOC / Pain areas)
from critical process obtained form from surveys in to
Deliverables of Quoting process
Does
Process B
Exists? No Sub Process Flow For each deliverable of critical process identify
Chart If the sub process or product / service feature exists
Yes A
82
Six Sigma Project Selection Approach (Contd.)
Approach Steps Tools Approach Description
A
Are SIPOC
For each deliverable of critical process identify
Metrics Define
Define Metrics
Metrics &
& Data collection unit of measure & measurement system
in place? implement
implement checklists
data
data collection
collection plan
plan
Dashboard
Ensure that the critical process metrics are
Enterprise linked with Business objectives, Strategy & VOC
Performance
Validate
Validate the
the Metrics
Metrics Management Matrix
Collect data for all critical process metrics
Process to define baseline process performance
Capability
Process
Process Base
Base lining
lining
Control Charts
Conduct a gap analysis between the critical
process baseline performance and targeted /
Explore
Explore need
need of
of customer expected performance level
Does No performance
performance Process
Gap Exists?
excellence
excellence
Performance
Yes If the sub process does not exist for a metric
B Enhancement
/ feature apply DMADV or
Apply
Apply DMADV
DMADV // implementation Process Re Engineering Approach.
Does No Process
Process
Process exists? Re Engineering
Engineering 1. DMAIC
2. DMADV
If the sub process exists for a metric / feature apply
Long
Long Term
Term Approach
Approach –– 3. Re Design / DMAIC for long term approach OR Problem
Yes
Apply
Apply DMAIC
DMAIC Re Engineer solving approach for Quick wins for early
realization of improvements
4. Problem
Quick
Quick wins
wins –– where solutions are known
Solving
Apply
Apply REIS
REIS Approach
83
SS Project Selection Approach
– Identifying Undesirable Conditions
1. Identify the 2. Quantify the 3. Identify the 4. Arrive at the vital
undesirable undesirable potential causes for few potential
business process conditions in to the undesirable causes and
conditions. Defect (%, PPM, conditions. prioritize .
(Customer DPMO, Sigma level) (High level process (NVA's, Multivoting,
complaints, VOC, or Cost . map, C & E 80:20 principle )
Quality reports, analysis, Pareto
Monthly analysis)
performance
indicators)
84
Improvement Methodology Selection
Process Improvement
Design processes that do not Enhance process metrics e.g. Monitor and reduce errors in the
exist for e.g. knowledge turnaround time, customer problem process e.g. ineffective call close
management resolution effectiveness etc etc
85
Six Sigma DMAIC Project Flow
Define Measure Analyze Improve Control
Tollgate Tollgate Tollgate Tollgate Tollgate
D M A I C
Define
Define Measure
Measure Analyze
Analyze Improve Control
Step 1: Identify customer & Step 3: Take the Step 5: Identify the key Step 7: Determine the Step9 : Put the control in
their care abouts. snapshot of the process, process input variables solutions to optimize the place to sustain the gains
Covert their needs in to how the process that affects the outputs output & eliminate / made by the process
Critical to Satisfaction performing currently & fix most. reduce defects & improvement.
the baseline.
(CTS) i.e. CTQ – Critical to variations.
quality, CTC – Critical to Step 6 : Verify the Step 10 : Integrate in daily
Cost & CTD Critical to Step 4 : Validate the
identified causes to see Step 8 : Implement the work by Process Owner &
Delivery. measurement system
whether those are real or solutions partly & team
from which we collect the
not. statistically verify their
data.
Step 2: Develop Project impacts on output.
Charter
Phase Deliverables
86
Six Sigma DMADV Project Flow
Define Measure Analyze Design Validate
Tollgate Tollgate Tollgate Tollgate Tollgate
D M A D V
Define Measure
Measure Analyze
Analyze Design
Design Validate
Validate
Step1: Identify new Step 3: Identify Step 5: Develop design Step 7: Optimize the Step9 : Validate results on
product, Process, Service caustomer & their care alternatives micro level design full scale & Put the
abouts (CTQ) parameters controls in place to
sustain the gain.
Step 4 : Identify , deploy Step 6 : Develop & Step 8 : Evaluate and Step 10 : Integrate in daily
Step 2: Develop Project data collection plan & evaluate high level verify the micro level work by Process Owner &
Charter process base lining design capability design. team
Phase Deliverables
Required
Required
Required Required Required Required •• Post
Required PostDesign
DesignCapability
Capability
• Customer surveys, • Operational definition, •• Design • Optimization
Designalternatives
alternatives •• Scale
Scaleup
updecisions
decisions
Interviews • Specification limits, •• Selection • Of design parameters
Selectionofofbest
best •• Full
Fullscale
scaleprocess
process
• Project Charter • Current Performance alternative • Prediction model implementation
alternative implementation
• Performance target, •• Detail • Design Verification
Detaildesign
design •• Improvement
Improvementtracking
tracking
• defect definition requirements • Updated design •• Process
requirements ProcessOwner
OwnerSignoff
Signoff
Tools Box •• High scorecard
Highlevel
leveldesign
design
Tools Box capability
capabilitypredicated
predicated
• High Level Project Plan • Benchmarking Tools Box Tools
ToolsBox
Box
• In Scope/Out of Scope • Data Collection Plan Tools
ToolsBox
Box • Design of Experiments •• Control
ControlCharts
Charts
• Customer Survey • CTQ Tree •• Benchmarking • Improved Process Maps •• Control
ControlPlan
Plan
Benchmarking
Methods (focus groups, • Affinity Diagram •• Design • Updated FMEA •• Process
Processcapability
Designscorecard
scorecard capability
interviews, etc.) • Process capability •• FMEA • Software simulation •• Design
Designscorecard
scorecard
FMEA
• MSA •• Layout • Pilot / Test plan •• Process
Processmanagement
Layoutdiagrams
diagrams management
•• Process • Design score card chart
Processmap
map//model
model chart
•• Prototyping • Tolerance analysis •• Standards
Standards& &
Prototyping
• Process management Procedures
Procedures
chart
87
Problem Solving (Quick Win) Project Flow
R Phase Exit E Phase Exit I Phase Exit S Phase Exit
Review Review Review Review
Phase Deliverables
Required Required
Required Required
• List of Improvement tracking
• Customer surveys, • Vital causes
countermeasures/ Process Control Plan
Interviews
solutions Process Owner Signoff
• Problem & Goal
statement • Countermeasure /
• Business dashboard solution implementation
plan
88
Project Sources and Selection Criteria
etc 89
Customers Perception
90
Customers
Who is a customer?
One who is paying for your service or product a person who buys
goods or services
Types of customers
•External or internal
•Lost customers
•Prospective customers
91
What do customer & shareholders want?
I ne at rig d pric
ed ht ti
What do customer wants?
at g
righ me .
oo
t pr ,
odu
e
v oic
r
ct,
Utility:They buy product or service for to me
cus
a need
Time : They want it when they need it
Value : They pay for it only if they What do shareholder wants?
perceive a value
r
lde
tom
r
ho
ar e
ers
Sh
ce
voi
92
Kano Model
CUSTOMER’S WANTS
•Must Be
•Satisfiers Delighters
No penalty for not doing Satisfiers
•Delighters them However, if you do The better we do, the
them, you get bonus happier the customer is
points (Plane gets to the
destination on time)
Performance
Must Be
The better I do, the less
dissatisfied the customer is.
(e.g., airlines get no credit for
getting bags to you on-time)
Customer Satisfaction
93
Kano Model : Exercise
Exercise 1:
Classify the following as Must Be, Satisfiers & Delighters
Exercise 2:
1. Identify a Must Be, Satisfier & Delighter from your own process
94
Gather voice of the customer
* Review existing voc data
* Decide what to collect
* Select tool to collect
*Collect data
• SURVEYS
• FOCUS GROUPS
• INTERVIEWS
• WORD OF MOUTH
• COMPLAINTS
95
Voice of Customer : Ways to Capture
Surveys :
A method of gathering information From a sample representing the
population these are comprehensive data driven information vehicles
that are useful in capturing customer requirements as well as
measuring performance against those requirements.
Focus groups:
in this group you group together similar customers and ask for their
opinion on the requirements as well as performance against those
requirements
Customer interviews:
could be informal or Structured. Informal interviews give good insight
into the customer perspective of the product and services and
depends on probing open ended questions
96
Voice of Customer : Ways to Capture
Word of mouth:
the customer feedback comes through direct and different channels.
Internal: employee feedback
External: reports from known sources
Be a customer yourself :
feel the quality of Service yourself
97
Voice Of The Customer
Sample Comments/Data
“I’m Tired Of Having To Call up for this Lousy Product Every Ten Days”
“I simply don’t understand what the Customer Support Professional Talks about ”
“The Phone Must Have Rung Ten Times Before I Got An Answer”
I’m Getting My Bill Consistent Monthly Bill Customer Wants Timely Bill (BAD)
At Different Times Customer Bill Received Same Day
Of The Month. Of Month (GOOD)
Take Too Long Speed Up Loan Customer Wants Fast Loan (BAD)
To Process The Customer Receives Approval On
Application. Customer Request Date (GOOD)
99
Exercise 1.1
Translating Customer Needs (VOCs) To Requirements.
100
Collection of Voice of Customer (VOC)
Step 1: Get the Voice of Customer (VOC) and the importance rating
through survey, feedback, market research, etc.
101
Step 2: Quantify the Customer rating numerically.
VOC Rating
Utilization of billable resources should be maximum 5 Very Important: 5
Abandoned calls should be minimum 3 Important: 3
Right & Complete Resolution 5
Reasonable: 1
Talk Time should be reasonable 3
Good Customer Service Skills 3
103
Step 5: Map the Customer Requirements & Stake Holder
Requirements
to Business and Operational Goals.
Requirements Rating Quality Cycle Training Multi Tasking
Time
Utilization of billable resources should be 5 High High Medium
maximum
Abandoned calls should be minimum 3 Medium High Medium
Right & Complete Resolution 5 High Medium
Talk Time should be reasonable 3 High Medium
Good Customer Service Skills 3 High
Buffer should be minimum 5 Medium High
Reduce loss of login hours 3 Medium high
Reduce Rework 3 High Medium
Increase CSat Score 5 High Medium
Reduce Customer Complaints 5 High Medium
104
Step 6: Calculate importance ranking to Business and Operational
Goals.
Requirements Rating Quality Cycle Training Multi Tasking
Time
Utilization of billable resources should be 5 High High Medium
maximum
Abandoned calls should be minimum 3 Medium High Medium
Right & Complete Resolution 5 High Medium
Talk Time should be reasonable 3 High Medium
Good Customer Service Skills 3 High
Buffer should be minimum 5 Medium High
Reduce loss of login hours 3 Medium High
Reduce Rework 3 High Medium
Increase CSat Score 5 High Medium
Reduce Customer Complaints 5 High Medium
Rank 124 118 42 55
105
Step 7: Identify Key Process Output Variables or CTQ’s (Ys).
106
Exercise 1.2 (10 minutes)
2. Identify Six Sigma projects for the areas identified through VOC
107
CTQ (Critical to Quality) & CTQ Tree
Voice of customer /
Organizational Goals/ Pain Areas
Business Y
Customer
Service Level Transactional Resource
Process Y Satisfaction
Agreement Quality
Development
Utilization
Score Cost
109
CTQ TREE
A methodology to break the CTQ’s in the over all level to the CTQ’s at
sub process level
Example 1: Example 2 :
CTQ Tree for the KPOV: Quality CTQ Tree for the KPOV: Cycle Time
Voice
& Accent Waiting
Time
Data Quality
110
Examples of Customer CTQs
A Car Purchaser A Prospective Employee
• Mileage • Good Salary
• Spacious • Location Preference
• Low price/affordable • Flexible Working Hours
• High technology • ESOPs
• Loan Facility • Good working place
• Yield
• Customer Sat (Ext)
• Productivity
• Customer Sat (Int)
• 1st Touch Cycle Time
• Service CSat (Ext)
• Case Res Cycle Time
• Service CSat (Int)
111
CTQ Drill Down responsibility Matrix
112
Exercise 1.3 (15 minutes)
Drawing a CTQ Tree
2. Draw a CTQ tree for your any one of the project you have selected
113
Quality Function Deployment (QFD)
What is QFD?
• QFD begins with Customer. It is also called House of Quality
114
Quality Function Deployment (QFD)
• It is a structured approach that facilitates the translation of the
customers voice into specific requirements.
115
Quality Function Deployment (QFD)
116
Quality Function Deployment (QFD)
Benefits of QFD
117
Quality Function Deployment (QFD)
How to build one?
1. The first portion of QFD matrix is the Customer Requirements. All the VOC that have been
translated into tangible requirements form the Customer Requirements part.
2. The second part, on the right hand side of QFD, is the Planning Matrix. It is used to quantify
Customers’ requirement priorities and their perception of the performances of existing
products. This is done through Importance Weighting of the Customer Requirements.
3. The third part of QFD is the Technical Requirement section. This describes the product or
service in the terms of the company and it includes all the measurable characteristics of the
product / service that might be related to meet the customers’ requirements. Often an
additional row is included to illustrate the direction in change of variables which is supposed
to result in improvement in product / Service performance.
4. The fourth part of QFD is Interrelationships section. This is used to translate the customer
requirements into the technical characteristics of the product / service. Inter-relationships
between each of the Customer requirements and technical characteristics are analyzed.
Generally, the level of inter-relationship is shown with the help of symbols denoting a 3 point
scale (High, medium, low ). Each level of inter-relationship is assigned a score. Generally a
score of 5-3-1 is used to denote High-medium-low-none.
118
Quality Function Deployment (QFD)
5. The fifth part of QFD is the Roof. This is used to denote the areas where the technical
requirements characterizing the product or service support or inhibit each other. Where
there is a deterioration because of interaction, “-” sign is used. Where there is an
improvement in one characteristic because of the other, “+” sign is used.
6. The final component of QFD is the Targets. It summarizes the conclusions drawn form
the matrix and team’s discussion. It consists of three parts: a) Technical Priority b)
competitive Benchmarks and c) Targets.
119
D M A I C
Technical Requirements
2
1 Customer Planning 5
INTER- RELATIONSHIPS
Requirements Matrix
Techincal Priorities
6
Targets
7
120
STEP - 1 Customer Requirement : Basically focus
on desired deliverable/outcomes from the
process
3
Roof
Technical Requirements
2
1 Customer Planning 5
INTER- RELATIONSHIPS
Requirements Matrix
ce
121
Technical Requirement : This describes the
STEP - 2 product or service in the terms of the company
and it includes all the measurable characteristics
of the product / service that might be related to
meet the customers’ requirements ; Basically
focus on input parameters which will have
direct/indirect impact on deliverable/outcomes of
3 the process;
Roof
Technical Requirements
2
1 Customer Planning 5
INTER- RELATIONSHIPS
Requirements Matrix
nce
Technical 122
STEP - 3
Roof : It shows the inter-relationship between
two or more inputs Parameters
` + ’ means positive relationship
` - ’ means negative relationship
+
+ 3
Roof
Technical Requirements
2
1 Customer Planning 5
INTER- RELATIONSHIPS
Requirements Matrix
ce
123
STEP - 4 Inter-Relationship Block : It shows the inter-
relationship between inputs parameters and
output deliverable
` 5 ’ means Strong relationship
` 3 ’ means Medium relationship
` 1 ’ means Weak relationship
` 0 ’ means No relationship
3
Roof
Technical Requirements
2
1 Customer Planning 5
INTER- RELATIONSHIPS
Requirements Matrix
ce
124
Planning Matrix :
STEP - 5
Our Product : Rating of existing
product/service on scale of 1-5 against
customer requirements
Competitor A/B : Rating of Competitor
product/services against our customer
requirements
3
Roof
Technical Requirements
2
1 Customer Planning 5
INTER- RELATIONSHIPS
Requirements Matrix
Competitor Rating shall
be benchmark rating
ce
125
Planned Rating : Target rating for customer
STEP - 5 requirement based on competitor rating
Improvement Factor : Ratio of Planned rating
and Our product Rating
Sales Point : Rating of Sales team (sales
perception)on ability to sell the
product/services based on how well each
3 customer need is met, on scale of 1.1, 1.3 and
1.5
Roof
Technical Requirements
2
1 Customer Planning 5
INTER- RELATIONSHIPS
Requirements Matrix
1.1 : Low inter-relationship
1.3 : Medium inter-relationship
ce
1.5 : Strong inter-relationship
126
Overall Weighting : Product of Sales Point,
STEP - 6 Improvement factor and Customer Importance
Technical Priorities : signifies the relative
importance of each of the technical
requirement in meeting the Customers’
specified needs. It is calculated by summing
up the products of interrelationships
weightings with the overall weighting in the
3 planning matrix.
Roof
5 8.7 43.5
5 13 65
Technical3 Requirements
5.9 17.7
2 3 10.8 32.4
1 4.4 4.4
3 7.3 21.9
5 4 7.8 39
224
1 Customer Planning 5
INTER- RELATIONSHIPS
Requirements Matrix
e
127
STEP - 7
Targets : The final outcomes of QFD are the
targets. These are a set of target
engineering values to be met by the new
product or service.
3
Roof
Technical Requirements
2
1 Customer Planning 5
INTER- RELATIONSHIPS
Requirements Matrix
e
128
4 House QFD
Customer
Measurements
(HOW’s)
Internal
House Actions
(HOW’s)
of Process
Quality House Requirements
s’ QT C
r e mot s u C
) s’ T A H W
#1 (HOW’s)
(
of Process
Customer
Customer Quality House Variables
House (HOW’s)
r e mot s u C
House #2
) s’ T A H W
(
of
st ne mer us ae M
Function
Quality House
Function
s noi t c A
l anr et nI
#3
) s’ T A H W
of
(
House
House
Process
Quality
Process
ss ec or P
#4
) s’ T A H W (
House
House
st ne meri uqe R
Control
Control
House
House
done right !
130
A Restaurant Example – Manila Pizza
CTQs from VOC (WHAT’s)
Importance Rating
– Type of Menu 3
– Economic aspect 4
– Presentation of staff 3
– Type of service 3
– Quality of service 4
– Quality of Food 5
131
Define
Capturing
Customer
Requirement
along with
importance
rating
132
Improve
133
Control
134
Exercise 1.4 (30 minutes)
2. Prepare the first two houses of the QFD for a given example
135
Brainstorming & Multi-voting Example
• Below table illustrates the number of group members & total ideas generated
• Now each member gives votes to ideas (maximum one vote to each idea) & below
is the vote distribution for ideas
• Top ideas whose vote count adds upto 32 are as below (30 is not possible), there
are 7 such ideas
136
Brainstorming & Multi-voting Example
• Take these 7 ideas for further round of multi-voting
• Give each member 4 votes (round off 50% of 7 to next higher integer) & ask them to distribute
these 4 votes among these 7 ideas. Below could be the distribution in this fresh round of voting
137
Points to Remember in Brainstorming
• All ideas are important, don’t out rightly reject any idea
138
Exercise 1.5 (15 minutes)
Multi-voting
139
A Right Project Selection is key to success
140
Six Sigma Project Selection Filters
Once the potential projects are identified next step is to verify, whether
these are six sigma project or not ?
There are two type of filters to qualify the potential projects as six sigma
projects. They are 1) Company filters and 2) Six Sigma Filters
141
1. Company Filters
Aligned
Alignedwith
with No Why
company Whydo
doit?
it?
company Drop
Strategy? Drop
Strategy?
No
Yes
1)
1)IsIsititaasevere
severe
No pain
pain inthe
in theprocess
process
2)
2) Is documentalproof
Is documental proof
Does
Doesproject
projectlead
lead available
available to provepain
to prove pain
USD--- min. per annum?
USD--- min. per annum? 3)
3) Is the pain sensedby
Is the pain sensed by
process experts
process experts
Yes
Yes (all 3)
No Scope
Can
Canititbe
becompleted
completedinin Scopeisistoo
toolarge.
large.
44toto66months? Consider making
Consider making
months? Multiple
Multipleprojects.
projects.
Yes
No
Is
Isneeded
neededdata
data No Implement
Implementaadatadata
available
available to quantifythe
to quantify the collection plan
collection plan
problem?
problem?
Yes
Yes
Is
Isthe root
theyes
root Derive
Deriveand
andimplement
implement
cause known?
cause known? the solution
the solution
No
Is
Issomeone
someoneelse
else Yes Implement
Implementthe
theother
other
working on the problem?
working on the problem? team’s solution
team’s solution
no
No
144
SS Project Execution Process Map
Client & Top
Management
Voice Of Customer & Pain Areas
BB Project Charter
(Champion /
sponsor) Project Kick Off Project Execution
( DMAIC / DMADV )
(MBB & Champion (MBB & Champion
are secondary resp.) are sponsor )
GB &
Team Integration & Deliver
Improvement Project Execution
1- MBB 1- BB, 1- GB Project
4 - PA 1
Project
DMAIC Project 2
Project
3
1- BB, 1- GB Project
Business 4 - PA 1
Process Project
Improvement DMADV Project 2
Project
3
Project
1- GB
4 - PA
1
Project
REIS Project
2
Project
3 146
Six Sigma
DMAIC Methodology
147
Overview of DMAIC Methodology
DMAIC Vs DMADV
DMAIC Methodology
– Define
– Measure
– Analyze
– Improve and
– Control
148
DMAIC Vs DMADV
CREATION PROCESS
IMPROVEMENT PROCESS
(DMADV)
(DMAIC)
Define, Measure,
Define, Measure, Analyse, Analyse, Design and
Improve and Control Validate
Improve processes, Create new processes,
DM
products, services, and products, services, and
C
AD
organisation to 6 Sigma
AI
plants to 6 Sigma
V
DM
quality quality.
It is also Called DFSS
Process Management
PROCESS MANAGEMENT
Leverage and sustain the gains achieved by
improvement and creation with BPMS, QMS, COPC etc
149
DMAIC Methodology
Step 5:
Step 1: DMAIC
CONTROL
DEFINE
Define Define project goals & customer
(internal & external) deliverables
Measure Measure the process to determine
current performance
DMAIC Analyze Analyze and determine the root
Step 4: Step 2: cause of the defects
IMPROVE MEASURE Improve Improve the process by eliminating
defects
Control Control future performance
Step 3:
ANALYZE
150
Define
Objective:
is to define the problem in a clear manner and in a way that is related to an
internal or external customer.
Deliverables:
• Fully trained team, committed to work on improvement project.
• Customers identified and defined (CTQ’s)
• Project charter and Process map
Check points:
• Trained team
Customers (and CTQ’s)
• Project Charter
• Business process mapping (SIPOC)
• Process Map
151
Measure
Objective
to measure what you care about most, making certain that your measurement
approach is sound and not based on questionable formulas or data.
Deliverables:
• Key measures identification, data collection plan, data on process variation
performance baseline, sigma level calculation.
Check points:
• Identification of Key measures - Defining high impact defects
• Data Collection Plan - Data collection
• Measurement system analysis
• Process Variation
• Long term and short term variability accounted for.
• Performance Baseline/Sigma Calculation
• Measure baseline process performance (capability, yield, sigma level).
152
Analyze
Objective
is to look for the critical root causes of the variability by applying statistical
tools to determine what factors are contributing to the problem.
Deliverables:
• Data and process analysis, root cause analysis, quantifying the
gap/opportunity.
Check points:
• Data and Process Analysis – Identification of gaps between current
• performance and the goal performance
• Root Cause Analysis- Verify and quantify the root causes of variation
• Quantifying the Gap/Opportunity - Determine the performance gap.
153
Improve
Objective
is to determine and confirm the optimal solution.
Deliverables:
• Generate (and test) possible solutions, select the best
solutions, design implementation plan
Check points:
• Generating (and Testing) Possible Solutions
• Selecting the best Solution (s)
• Designing Implementation Plan
154
Control
Objective
is to be sure the quality improvements remain in effect and the problem
does not recur.
Deliverables:
• Documentation and implementation of monitoring plan, standardized
process, documented procedures, response plan established and
deployed, transfer of ownership (project closure).
Check points:
• Monitoring Plan
• Process Standardization
• Documented Procedures
• Transfer of Ownership (Project Closure)
155
Define Phase
156
Define
Main Activities
1.0 Step 1:
Define • Identify customer & their care about.
Defi
Opportunit • Convert their needs in to Critical to Satisfaction (CTS) i.e.
ies CTQ – Critical to quality, CTC – Critical to Cost & CTD
Critical to Delivery.
ne Step 2:
• Develop Project Charter reporting improvement
opportunity and effective project team
Target charter
SIPOC • Team Charter
• CCRs
SI OC •
Process Process SIPOC
Map • Macro Level Process
Map
157
Define Phase Topics
Project Charter
Team Charter
SIPOC
Process Mapping
– Top Down Model
– Cross Functional Process Mapping &
– ICOM model
158
Project Charter
159
Project Charter
What Is A Project Charter?
• A project charter is a document that provides purpose and goals
for an improvement team
160
Business Case
Business Case Development
• The business case describes the benefit for undertaking a
project. The business case addresses the following
questions:
– Does this project align with other business initiatives?
– What is the focus for the project team?
161
Problem Statement
Description Of The “Pain”
162
Problem Statement Example
Poor Example:
Weak Problem statement
Our Fatal accuracy score is at 80% against the client target of 95% and
we Need to improve it
Improved Example:
Fatal accuracy score (what) this quarter (when) has been observed to be
at 80% for the last 4 months (extent) against the client target 95% which
has significant impact on customer satisfaction. (impact)
163
The Problem Statement
Key Considerations/Potential Pitfalls
164
The Goal Statement
Project Objective
165
SMART Problem And Goal Statements
Specific
Measurable
Attainable
Relevant
Time Bound
166
Goal Statement Example
Poor Example:
Put in place a Transaction monitoring evaluation system to increase
the fatal accuracy.
Improved Example:
Increase the fatal accuracy from the existing 80% to 95% by the end of
first quarter 2005.
167
Project Scope
• What Process Will The Team Focus On?
168
8 Steps to Scope a Project
1. Identify the customer
• Who receives the process output?
• May be an internal or external customer
1. Define customer’s expectations and needs
• Ask the customer
• Think like the customer
• Rank or prioritize the expectations
1. Clearly specify your deliverables tied to those expectations
• What are the process outputs?
• Tangible and intangible deliverables
• Rank or prioritize the deliverables
• Rank your confidence in meeting each deliverable
1. Identify CTQ’s for those deliverables
• What are the specific, measurable attributes that are most critical in
the deliverables
• Select those that have the greatest impact on customer satisfaction
169
8 Steps to Scope a Project
5. Map your process
• The process of producing the deliverables
• The process as it is working prior to the project
• If you are delivering something, there is a process, even if it has not
been formalized
6. Determine where in the process the CTQ’s can be most seriously
affected
• Use a detailed flowchart
• Estimate which steps contain the most variability
7. Evaluate which CTQ’s have the greatest opportunity for improvement
• Consider available resources
• Compare variation in the processes with the various CTQ’s
• Emphasize process steps which are under the control of the team
conducting the project
8. Define the project to improve the CTQ’s you have selected
• Define the defect to be attacked
170
Importance of Scoping
– Team focuses on trivial pain areas, and missing out the vital ones
171
Milestones
• A preliminary High Level Project Plan with dates
172
Take Aways –Project Charter
• Key elements of a charter include: Business Case, Problem and Goal
• Statements, Project Scope, Milestones, and Roles.
• A charter clarifies what is expected of the project team, keeps the team
focused, keeps the team aligned with organizational priorities, and
transfers the project from the champion to the improvement team
173
Period
Start End Responses
Project Charter Example 1 Mar 05 30 May 05
Project Sponsor xxxxxx
MBB
Xxxx (YB)
Goal statement: Reduction of rework from 38% to 5% Project Leader
xxxxxxxxx
Problem Statement : Black Belt
Name Sign
The rework percentage in this quarter (Apr’05 to June’05) has been observed jkafkj
MEMBERS
to be at 38% based on the system reports which is leading to over stretching jkjklaj
of PE to meet the production targets. dxcv
175
Exercise 1.6 (15 minutes)
Project Scoping
176
Team Charter
177
Team Charter
Team Roles Refresh Team Charter explains following
•How do you want the champion to work
Sponsor with the team?
• Review the project progress once a month
• Provide/modify direction/alignment with • Is the team’s role to implement or
business realities recommend?
• Provide resources required from time to time
• Remove Roadblocks • When must the team go to the champion
for approval? What authority does the
Black Belt/MBB team have to act independently?
• Provide content knowledge on Six Sigma
tools to the team • What and how do you want to inform the
champion about the team’s progress?
Project Leader
• Keep the team focused. Arrange logistics • What is the role of the team leader and
and team meetings and raise issues with the team coach?
Sponsor
• Are the right members on the team?
Team Member (s) Functionally? Hierarchically?
• Participate in meetings, collect data, do
analysis using Quality tools, provide subject
matter expertise related to process
178
Exercise 1.7 (45 minutes)
179
A Good Project
• A good project:
• Problem & goal statement clearly stated
• Defect and opportunity definition is clearly understood
• Does not presuppose a solution
• Clearly relates to the customer and customer requirements
• Aligns to the business strategy
• Uses the tools effectively
• Data driven
• A bad project:
• Project is not focused – scope is too broad
• Not clear on what you are trying to fix
• Solution is already known/mandated without proper
investigation
• Difficult to see linkage to customer needs
• Working on a project that will not move the needles
• Little or no use of tools
180
SIPOC
181
SIPOC
SIPOC:
• A tool to identify all relevant elements of a process
• Helps to understand a complex process better
• Graphic display of steps, events and operations that constitute a
process
S - Suppliers
I - Inputs
P - Process
O - Outputs
C - Customers
182
SIPOC
Suppliers
– People who provide input to the process
Inputs
– Information, material etc., goes into the process from some other group of
people (supplier)
Process
– Process is a series of activities that takes an input, adds value to it and
produces an output for a customer
Outputs
– Output of a process creating a product or service that meets a customer need
Customers
– Users of the output 183
Information Flow & Measures
Thinking
Flow
Requirements Requirements
S I P O C
184
SIPOC: Uses
185
Steps to create SIPOC
1. Attaining a full understanding of all the steps of a process. This is done by
looking at processes from customer’s point of view.
3. Brainstorm list of all process steps. Go on the floor, walk through the
process and interview people working on the process as needed.
5. Discuss, review & modify process step sequence to agree on “As Is”
process map.
B X2 Y2 Beta
C X3 Y3 Gamma
187
SIPOC: Example 1:
Contract Management : Contract Publishing
SIPOC LEVEL I Contract Management : Contract Publishing
7.Publish Contract
Contract
Number.xls,
Contract
Information Sheet 8.Update Contract Tracking Sheet
188
Contract Management : Contract Enquiry
SIPOC LEVEL I Contract Management : Contract Enquiry
Job Aid
3. Verify Authorization
P2P Contract Communication
Management to the Enquirer P2P Arthur
Onshore Team
Contract
Number.xls, 4. Check Availability
Authorization
Sheet
5. Get information/document
189
Contract Management : Contract Review
SIPOC LEVEL I Contract Management : Contract Review
P2P Contract
Management 3. Validate Contract Data
Onshore Team Emptoris P2P Arthur
Contract
Number.xls
190
SIPOC: Example 2:
Call Handling
S I P O C
Agents Team Incoming Call Opening Completed Caller
Call Call
Y
Spanish? Interpreter
Managers Client
ACD
Performance
Confirmation
Reports
Auditors IVR Internal
Verification Customers
SIPOC
1. Refer to your workbook.
192
Process Mapping
193
Process
“Process is a series of activities that takes an
input, adds value to it and produces an output for
a customer ’’
RESOURCE
S
INPUT OUTPU
PROCES T
S
MEASURE
S
SLAs
194
Process Mapping Definition
195
Why Process Mapping?
• Validates our understanding of the process with the client (The way
work gets done)
196
Flowchart Vs. Process Map
197
Process Map Symbols
Symbol Meaning
Start or End of Process
Activity or Process Step
Decision or Inspection Point
Delay
Connector
Document
Data
Direction of Flow
198
Basic Types of Process Maps
• Linear Process Maps Call Opening
Confirmation
Closing
199
“As Is” Process Map in define phase
200
Steps to create “As Is” Linear Process map
1. Attaining a full understanding of all the steps of a process. This is done by
looking at processes from customer’s point of view.
3. Brainstorm list of all process steps. Go on the floor, walk through the
process and interview people working on the process as needed.
5. Discuss, review & modify process step sequence to agree on “As Is”
process map.
201
Analyze “As Is” Linear Process map
202
“As Is” Linear Process map : Example 1
Call
Opening A
Collect data on
% Spanish calls
Yes
Spanish? Interpreter Response
No
Assistance
Confirmation
Collect data on
% escalated calls
Yes
Escalate?
Verification
No
NVA
On hold
Call closing Collect data on
% accuracy
Assistance
After call
work
A
NVA = Non value added activity
203
“As Is” Linear Process map : Example 2
Business Unit A
Are
Metrics Define Metrics &
in place? implement
Business Process data collection plan
Explore need of
Identify Customers Does No performance
Gap Exists?
excellence
4. Brainstorm list of all process steps. Go on the floor, walk through the
process and interview people working on the process as needed.
6. Discuss, review & modify process step sequence to agree on “As Is”
process map.
205
Analyze “As Is” Cross functional Process map
206
Cross Functional Process Mapping
Step
Function 1 Step 5
4
Step 3
Function 2
Step 2
Step 6 Step 7
Function 4
207
Client & Top
Voice Of Customer & Pain Areas
Example 1
Management
BB Project Charter
(Champion
sponsoror.) Project Kick Off Project Execution
( DMAIC / DMADV )
(MBB & Champion (MBB & Champion
are secondary resp.) are sponsoror.)
GB &
Team Integration in Deliver
208
Example 2 : Photo Process
Photographer Postal System Processor
Take Photograph
Return home
Place film in
Pre paid envelope Send to Processor
1 Day Delay
3 days Process Negative
Produce Prints
1 hr
Inspect
N
OK ?
Await Photograph Send to Photographer
Y
Package for posting
3 days
Inspect Photograph
Photograph Y Frame
to be framed N
Store in album
209
Example3: Import process
Imports Supplier Finance Forwarder / Customs
Clearing Agent
Planning
Approve P.O
Direct
Payment or Check payment
Site Draft terms
LC
Request for LC
Open LC & send
Copy to Imports
Not OK
Verify LC
OK
Inform & send Verify correctness
Copy to supplier Of LC & Inform
Follow-up material
A 210
Example3: Import process
Imports Supplier Finance Forwarder / Customs
Clearing Agent
A
B
211
Example3: Import process
Imports Supplier Finance Forwarder / Customs
Clearing Agent
Deposit amount in
Customs & clear the goods
Move to
Stores.
212
Other Types of Process Maps
213
Macro to Micro (M2M) Process Map
It can be used when
- Team wants to pay attention to the important process steps in detail.
The Process
The Sub-Process
The Micro-Process
214
Example 1 : Quotation Sub-Processes
Research Create Proposal Refine Proposal Accept Quote
Optional
Previous Create initial Create final
Purchase proposal with all proposal
History relevant options
Look up
Previous
Profile defined Escalate
Quote
concession
History
request
Look up
Optional indirect
Cross geo Validate customer
customer and proposal pre- Concession
quoting credit check credit process
Look up rating lookup
215
Other process mapping models (additional information)
ICOM
Control
Input:
The material / information which enters in to the
system with specified process capability Input Output
Process
Control :
The systems, policies which control or governs
the process. Mechanism
Output :
The value added material / information through Single Process
the process and entitled for next process
Level 0 Business/Enterprise
1
Basic process Increasing
Level 1 structure of the
business
level
of detail
1.1
Level 2 1.2
Sub-process
1.3
1.3.1
1.3.2
Activities within
Level 3 Sub-process
1.3.3
217
ICOM Model – Example (Process : Call Handling )
SOP Rules of verification Rules of verification Database
SLA Data base Data baseIdentified
Identified
Customer Type
Connected Genuine
Call Agent press Agent Identification of call Obtaining the
Call caller
Button to Verifies Of Type Requirement
attend call Caller & authorization of call Of caller
Soft skills
Peripheral Server, Software Server, Software
Caller’s
Agent training Agent training
requirement
Database
No SOP
Hold call and Processed
Database Obtain information Need to information Searching and
from supervisor verify from processing
Information supervisor? of information
as requested
Agent provides by caller Yes Server, Software
information Agent’s training &
to caller Process Knowledge
219
Measure
Phase
220
Main Activities
Step 3:
Measure Phase
Tools used Outcomes
• Operational
Definitions
Process • Measurement System
Map Analysis
Data Collection Plan
Gage R&R • Data Collection
Formats and Plans
• Process Baseline
• capability
• Specification limits,
FMEA Baseline and target
Benchmarking setting
• target, defect
definition for Project
Preparation
Preparation FMEA Process
FMEA Process
Y(s) Improve
Improve
221
Measure Phase Topics
Fundamentals of Minitab
Basic Statistics
– Measures of Central Tendency
– Measures of Dispersion
– Probability Distribution
222
Measure Phase Topics
Gage R&R
– Gage R&R for Continuous Data
– Gage R&R for Attribute Data
Process Capability
223
Why to Measure ?
If we can’t accurately
measure something
We can’t control it
224
Science of Six Sigma
227
Knowledge is Power
228
Use of Statistics
Data
Statistics
convert
to
Usable
Information
229
Data Collection Plan
Decide objective
Step 3
Data Collection
• Stick to procedure/plan
Evaluation of Data
230
Operational Definition
Clarity is more important when developing and selecting the measures that
will be used to determine the SIGMA PERFORMANCE of the process.
231
Operational Definition
Example :
the total number of defective invoices (any invoice with any defect)
or
Each of these cases may require a very different approach for gathering
the data.
232
Operational Definition
233
Example of Operational Definition.
234
Exercise: Operational Definition
235
Develop Measurement Plan
Measurement Plan
Determining current process performance usually requires the collection of
data. When developing a measurement plan ensure that:
– The data collected is meaningful
– The data collected is valid
– All relevant data is collected concurrently
236
Data Classification
Before data collections starts, classify the data into different types:
continuous or discrete.
237
Types of Data
Example
% of applications with or without
errors.
238
Continuous Data
Data generated by
– Physically measuring the characteristic
– Generally using an instrument
– Assigning an unique value to each item
Continuous Data:
Example (Call Waiting Time in Secs)
Examples:
SL No. Waiting SL No. Waiting Time
Time
1. The time it takes to write a
1 98 11 102
proposal.
2 103 12 98
2. The time it takes to conduct a
3 100 13 101
feasibility study.
4 100 14 101
3. The time it takes to close the
5 99 15 99
books each month.
6 101 16 100
4. Invoice amounts.
7 97 17 101
5. Sales order amounts.
8 102 18 99
6. Handling Time, Time to Certify
9 100 19 100
PEs, etc.
10 99 20 102
239
Discrete Data Good
NOGO GO
Examples:
• Gender, Shade Variation, etc.
• Escalations, Repeat Calls, Defective Transactions, Defects in
Transactions etc.
240
Defects versus Defective
Out of these 09 Invoices… there are...
Quantity: AAAAA Quantity: AAAAA Quantity: AAAAA
Price: $BBBBB Price: $BBBBB Price: $BBBBB
Date: YY/YY/YY Date: YY/YY/YY Date: YY/YY/YY
3 Defective
Invoices
Quantity: AAAAA Quantity: AAAAA Quantity: AAAAA
Price: $BBBBB Price: $BBBBB Price: $BBBBB
Date: YY/YY/YY Date: YY/YY/YY Date: YY/YY/YY
6 Defects
241
Example of Opportunities
• Classifying the items into only two groups based on some criteria
• Each item will fall in either of the two groups
• All the items classified into a group will have same value
• Expressed or summarized as proportion p or percentage
Examples:
• Gender, Escalations, Repeat Calls, Defective Transactions, etc
• An invoice is either “complete” or “incomplete”.
• A delivery is either “late” or “not late”.
• A product is either “damaged” or “not damaged”.
• A hotel room is either “dirty” or “clean”.
• A sales pitch is either a “thumbs up” or “thumbs down”.
243
Binary Data : Example
(Month wise Escalation of Transactions)
244
Discrete : Count Data (Poisson)
Data generated by
• Counting the exact number of occurrences of the characteristic in a
group of items.
• It takes integer values as 0,1,2,-,-,-,
• Expressed or summarized as average number of occurrences
Examples:
• Number of fatal defects in transactions processed
• Number of accidents in the city during June 2005
• Number of suicides in the city during 2004.
• The number of errors on twenty invoices.
• The number of computer system failures in a month.
245
Count Data: Example
(Data on Defects found during Transaction Audit)
246
Exercise 1.10 (20 minutes)
Type of Data
247
Cause
Data Measurement Plan Format Data
Performance Operational Definition Data Source Sample Who will Data collection How will Other data that should
measure & location size collect period date be be collected at the
the data collected same time
Time to Date and time of transaction Client 256 Raju 1-Aug-05 to 31-Random Type of transaction,
process a was download from client server server Smita Aug-05 selection Day of week,
transaction by an agent to the date and time system Agent name
of the PROCESSED transaction time.
was submitted in client server
The data is being collected to measure the performance is called PERFORMANCE DATA.
On the other hand, CAUSE DATA, focus on why the process performs as it does. Cause
data supports the problem solving by helping to isolate root causes of the problems.
Most of the times, however, we won’t know enough about potential causes until we have
determined our processes current performance level. Be prepared to document current
performance first, then brainstorm potential causes and collect additional data related to
those causes at a later date.
248
Data Collection
While collecting data ensure that the data measurement plan is followed.
Note any deviations from the plan.
Use various tools like check sheets to record and grouping of the data.
249
Sampling
250
Sampling Objectives
251
Basic Definitions and Symbols
Population (N): The entire set of objects or activities for a process
252
Sampling Definition
Sampling is the process of:
Collecting only a portion of the data that is available or could be available,
and drawing conclusions about the total population (statistical inference)
Population Sample
x x x
x
x x x x
x
x x x x x
x x
x x x x
x x
x x x
x x
x x
N = 5000 n = 100
Example:
Estimating the average height of students in a college by measuring the
heights of only 250 students (250 is a subset of entire students
population).
253
Sample ….. When ?
When to …..
• Collecting all the data is impractical or too costly
When not to ……
• A subset of data may not accurately depict the process, leading to a
wrong conclusion (every unit is unique-e.g., structured deals)
254
Kinds of Sampling
Random Sampling
• This sampling ensures that the
characteristics of the population are
collected with equal possibility.
Stratified Sampling
• Make stratifying plan for Group A Group B
population characteristics.
• Select the sample among each
stratified group
255
Frequency of Sampling
256
Sampling: Methodology
257
Methodology: Example
To estimate the average height of students in a college
10
Mean Waiting Time = 28.55 30
The following data is a sample of 10 from the above data:
50
30
Sample Mean = 25.3
60
34
Sample Statistics may not be exactly equal to Population Statistics
259
Methodology: Issues
The following data is another sample of 10 from the parent data:
26
The estimate may vary from sample to sample
40
To overcome these issues Confidence Intervals are developed
260
Confidence Interval: Methodology
• Provide two limits: an upper bound & a lower bound to the population
statistics such that the true value of population statistics will lie within
these limits with a specified level of confidence
261
Continuous Data: CI for Population Mean
262
Continuous Data: CI for Population Mean
α /2
1
0
-3 -2 -1 0 1 2 Z α /2 3
263
Continuous Data: CI for Population Mean
α CI Zα /2
0.05 95 % 1.96
0.01 99 % 2.57
0.10 90 % 1.64
264
CI for Population Mean: Example
10
Mean Waiting Time = 28.55
30
The following data is a sample of 10 from the above data:
50
30
Sample Mean = 25.3
Sample SD = 15.34
60
34 265
CI for Population Mean: Example
26
95 % Confidence Interval on Mean:
27.8 ± 1.96 x 11.94 / √10 = 20.39 to 35.20
40
266
Exercise 1.11 (20 minutes)
CI for Population Mean
267
Discrete Data: CI for Proportion
268
Exercise 1.12 (20 minutes)
CI for Discrete data
269
Sample Size Calculation: Continuous Data
Using 95 % CI
True value of population Mean will lie between
Sample Mean ± 1.96 SD / √n
Then
Population Mean - Sample Mean < 1.96 SD / √n ( with 95 %
Confidence)
Hence
To estimate the population mean with an accuracy of say 5
I.e Population Mean - Sample Mean < 5
I.e 5 = 1.96 SD / √n
n = (1.96 SD / 5)2
270
Sample Size Calculation:
Methodology Continuous Data
Solve for n
271
Exercise 1.13 (20 minutes)
Sample Size Calculation for continuous data
272
Sample Size Calculation: Discrete Data
Using 95 % CI
True value of population proportion will lie between
p ± 1.96 x √ p(1-p) / n where p is sample proportion
Then
Population Proportion - Sample Proportion < 1.96 x √ p(1-p) / n
Hence
To estimate the population proportion with an accuracy of say 0.01
I.e Population proportion - Sample proportion < 0.01
I.e 0.01 = 1.96 x √ p(1-p) / n
n =1.962 p (1-p) / 0.012
Sample Size required to estimate population proportion with an accuracy of 0.1:
1.962 p (1-p) / 0.012
273
Sample Size Calculation: Methodology Discrete
Data
Collect a small sample
Solve for n
274
Exercise 1.14 (40 minutes)
Sample Size Calculation for discrete data
275
Data Display and Evaluation
Once we collect the data, it is always preferable to evaluate the data for its
accuracy and usage prior to calculation of the capability of the process
As a initial step, display the data using Patero charts, Scatter plot, control
charts, Histogram or Normality etc to look for data errors, trends and outliers.
Evaluate the data to confirm that the data is dependable, consistent, reliable
and representative.
Also ensure that, we get similar results if we repeat the data collection.
Finally confirm that the data collected provide the information we need.
276
Fundamentals of Minitab
(Statistical Package)
277
Once you start Minitab, Minitab opens with two main windows.
Session Window
It displays the results
of your analysis in text
format.
Column
Data Window
It contains an open
worksheet, which is
similar in appearance
to a spread sheet.
We can open multiple
work sheets.
Row
Cell
278
Column with Column with
Column with
Numeric data date/time data
Text data
Column Name
To be written by us
Row Number
All the columns are formatted by default to Numeric data. As per the requirement we can
reformat the columns.
Right click mouse>Format Column>numeric/text/date.
279
File
Most of the functions of the
File Menu are similar to Excel
sheet.
Edit
Most of the functions of the File
Menu are similar to Excel sheet.
280
Data
It is very useful function menu in
Minitab. to immunize the
duplicate data entry in the work
sheets.
282
Stat
All sorts of statistical analysis
can be done for the data
stored in various columns in
the work sheet.
Graphs
Various graphs can be plotted
using this menu
Editor
Used for Formatting of the
columns
283
Basic Statistics
284
Describe Sets of Continuous Data
The following three characteristics can describe the continuous data set
2. Measures of Dispersion
1. Range 2. Variance 3. Standard Deviation
3. Shape
1. Histogram
285
Continuous Data:
Measures of Central Tendency
1. Mean
2. Median
3. Mode
286
Mean: • Numerical value indicating the central value of data
• Sum of all observations / Total number of observations
287
Median: • Middle Value
• Value which divides observations arranged in ascending or
descending order into two equal halves
Case 1: Total number of observations is odd
Median: Middle Value
Case 2: Total number of observations is even
Median: Average of two middle values
289
Continuous Data :
Measures of Dispersion
1.Range
2.Variance
3.Standard Deviation
290
Range: Definition
Example:
5 4 7 3 2
15 9 8 5 2
Maximum Value = 15
Minimum Value = 2
Range = 15 – 2 = 13
291
Range: Issues
It depends only on extreme values
Hence affected by outliers
16
14
12
10
8 Range
6
4
2
0
1 2 3 4 5 6 7 8 9 10
Example :
5 4 7 3 2
15 9 8 5 2
Step 1:
Calculate Mean = (5+4+7+3+2+15+9+8+5+2) / 10
Mean = 6
293
Example: Standard Deviation
Step 2: Take deviations from Mean
16
14
12
10
8
6
4
2
0
1 2 3 4 5 6 7 8 9 10
-1 -2 1 -3 -4
9 3 2 -1 -4
294
Example: Standard Deviation
Step 3:
Since some values are positive & rest are negative, while
taking sum they will cancel out.
So square the values & Sum
1 4 1 9 16
81 9 4 1 16
295
Example: Standard Deviation
5 4 7 3 2 Step 1: Calculate Mean,
15 9 8 5 2 Mean = 6
298
Construction of Frequency Table
Lower Limit of a Class
• 1st Class Lower Limit : Minimum Value
• Lower Limit of any class other than 1st class : Upper Limit of
Previous Class
Upper Limit of a Class
0
98.2 99.4 100.6 101.8 103
300
Exercise 1.15 (40 minutes)
Mean, Median, Standard Deviation and histogram
301
Probability & Normal
Distribution
302
Probability Definition
Example
Number of tosses of a coin = 100
Number of times Head occurred = 49
Number of times Tail occurred = 51
303
Example 1 :
The day wise average waiting time in seconds (AWT) of calls for 10
days is given below:
50
a. Calculate the probability that average waiting time > 60 Seconds?
b. Calculate the probability that average waiting time < 50 seconds
a. Probability of AWT > 60
61
= Number of cases with AWT > 60 / Total number of cases = 2 / 10 = 0.2
20 % of the days AWT will be more than 1 Minute
750
Suppose the SLA on productivity is minimum 720 transactions per
day, calculate the risk of not meeting the SLA?
= 1 / 14 = 0.071
810
= Number of days with Productivity < 720 / Total number of days
305
Issues
To estimate probability using this method,
huge amount of data is required
Solution
306
Statistical Distributions
Continuous distribution
•Normal distribution
Discrete distribution
•Binomial distribution
•Poisson Distribution
307
Normal Distribution
Definition: Consider the following data on Average Handling Time
(AHT) in minutes of 16 Days:
0
2.1 2.3 2.5 2.7 2.9
308
Plot of the Data:
0
2.2 2.3 2.4 2.5 2.6 2.7 2.8
• Bell Shaped
• Symmetric
• Total Area under the curve is 1
310
Step3: Enter the Column Title to the Variable Text Box and Click OK button
311
Step 4: Minitab Output
Interpretation:
If P-Value ≥ 0.05, then Data is Normal
312
Standard Normal Distribution
If
Data follows Normal Distribution
then
(Data - Mean) / SD will follow Standard Normal Distribution
313
Standard Normal Distribution: Example
Data:
2.3 2.7 2.4 2.6 2.5
2.5 2.4 2.5 2.6
Mean = 2.5
SD = 0.1225
Z : (Data - Mean ) / SD
-1.633 1.633 -0.8165 0.8165 0.00
0.00 -0.8165 0.00 0.8165
Mean = 0.00
SD = 1.0
314
Standard Normal Distribution: Properties
4
Between
3
Mean ± 1 SD :
68.26 % of Values will lie
2
Mean ± 2 SD :
1 95.46 % of Values will lie
0 Mean ± 3 SD :
-3 -2 -1 0 1 2 3 99.73 % of Values will lie
68.26%
95.46%
99.73%
315
3
0
2.3 2.4 2.5 2.6 2.7
Example:
The probability that AHT will be more than 2.6 Minutes is the
area above 2.6 Minutes in Normal Curve
316
3
0
2.3 2.4 2.5 2.6 2.7
Example:
The probability that AHT will be less than 2.35 Minutes is the
area below 2.35 Minutes in Normal Curve
317
Normal Distribution: Examples
The Time to Certify PE’s is normally distributed with mean 40 days and
standard deviation 8 days. If the client wants that all PEs shall be certified
within 34 to 48 days, estimate the chance of meeting client requirement?
Mean = 40
SD = 8
Let x be the Time to Certify PE
318
Normal Distribution: Examples
0
-3 -2 -1 0 1 2 3
0
-3 -2 -1 0 1 2 3
320
Normal Distribution: Examples
Case 2: From Standard Normal Tables
P (z > 1 ) = 0.1587
OR
Chance of Meeting Client Requirement = 0.7733 - 0.1587 = 0.6147 = 61.47 %
0
-3 -2 -1 0 1 2 3
321
Exercise 1.16.1 (20 minutes)
Probability distribution for continuous data
322
Handing Non normal data
Handling Non
Normal Data
323
Binomial Distribution:
If the data is binary, then probabilities are estimated using Binomial Distribution
324
Binomial Distribution: Example
Let p = 2 % = 0.02
Number of Transactions Audited (n) = 400
Number of Defectives (d) = 21
325
Binomial Distribution: Example
Let p = 2 % = 0.02
Number of Transactions Audited (n) = 400
Number of Defectives (d) = 21
326
Calculation of Binomial Probabilities using Minitab
Step 1:
Copy the defective data to Minitab Worksheet as shown below:
327
Calculation of Binomial Probabilities using Minitab
Step 2:
Go to Calc Probability Distributions Binomial
328
Calculation of Binomial Probabilities using Minitab
Step 3:
Select Cumulative probability, Enter Number of trials, Probability of success,
Input Column, Option Storage and click ‘OK’ button
329
Calculation of Binomial Probabilities using Minitab
Step 4:
Minitab will calculate Binomial Probabilities as display in Optional Storage
Column as shown below
Let p = 2 % = 0.02
Number of Transactions Audited = 400
From Binomial Distribution,
Probability of getting less than 20 defectives in 400 transactions = 0.9999
Hence Probability of getting 20 or more defectives = 1 – 0.9999= 0.0001 ≅ 0
i.e. if the process is operating at 2 % defectives:
the chance of getting 21 defectives out of 400 is almost 0 ,
Process performance is deteriorated.
332
Exercise 1.16.2 (20 minutes)
Probability distribution for Binomial Distribution
333
Poisson Distribution:
If the data is Count, then probabilities are estimated using Poisson Distribution
334
Poisson Distribution: Example
The average number of repeat calls per day in a voice process is 20. On a
particular day , there were 25 repeat calls. Is there any problem with the process
that day?
335
Calculation of Poisson Probabilities using Minitab
Step 1:
Copy the different values of repeat calls to Minitab worksheet as shown below:
336
Calculation of Poisson Probabilities using Minitab
Step 2:
Go to Calc Probability Distributions Poisson
337
Calculation of Poisson Probabilities using Minitab
Step 3:
Choose Cumulative probability, Enter Mean, Input column & Optional storage as
shown below and click “OK” button.
338
Calculation of Poisson Probabilities using Minitab
Step 4:
Minitab will display the probabilities in the Optional storage column as shown
below
340
Poisson Distribution: Example
341
Exercise 1.16.3 (20 minutes)
Probability distribution for Poisson Distribution
342
Gauge R&R
(Measurement System Analysis)
343
Introduction
Measure
When ? Define
Data Baseline
Identify the Identify Gage R&R Collection Process
Project Y(CTQ) for Y Baseline Capability
Examples
• A black belt wants to reduce the variability in transaction time
345
Measurement System
What is Measurement ?
To give the value to express specific function of a certain material.
346
Why Worry about Measurement Variation?
Verify Assist in
How might measurement
product/process continuous
conformity to variation affect these decisions? improvement
specifications activities
What if the amount of
Process
Process measurement variation
is unknown
Measurement
Measurement
?
Measurement variation can make our process capabilities appear worse than they are.
347
Accounting For Changes
While we can come up with many explanations, they would fit into
three general categories
348
Sources of variation
Product Variability
(Actual variability)
Measurement
Variability
Total Variability
(Observed variability)
349
Observed Process
Variation
Actual Measurement
Part to Part Variation
Variation
Long Term
Within Sample
Process Variation due Variation due
Variation
variation to operators to Gage
To study & reduce the process variation the measurement variation has to be identified
and separated from process
350
Accuracy (Bias)
The difference between the observed average of measurements and
the true average of the items measured.
Accuracy
Observed True
Average Average
351
Repeatability
Master
Master
Value
Value
Poor
Good Repeatability
Repeatability
Master
Master Poor
Value
Good Value Reproducibility
Reproducibility
353
Stability
The variation in the average of at least two sets of
measurements obtained with a gage as a result of time on
the same pieces.
Stability
Time 1 Time 2
354
Methods of performing Gage R&R Studies.
Attribute
Discrete Agreement
Data
Analysis
355
Exercise: Gage R & R– Continuous Data
Given the data below for reading by 3 appraisers on 6 calls with 2 trails,
determine whether the measurement system is acceptable
356
Gage R & R– Continuous Data
Step 1:
Copy the data to Minitab worksheet as shown below
357
Gage R & R– Continuous Data
Step 2:
Choose Gage R&R Study (Crossed) from Stat Menu as shown below:
358
Gage R & R– Continuous Data
Step 3:
Enter Part Numbers, Operators & Measurement Data.
Choose Xbar and R as shown below
Click “OK” button
359
Gage R & R– Continuous Data
Step 4:
Minitab will give the following Output
Source Var Comp % Contribution
Total Gage R & R 17.434 4.06
Repeatability 7.338 1.71
Reproducibility 10.096 2.35
If < 20 %.
Part-To-Part 411.568 95.94 Gage acceptable
Total 429.002 100 Else if > 30 %,
Gage not acceptable
Else
Source StdDev (SD) (6 * SD) (%SV)
some problem with
Total Gage R & R 4.1754 25.052 20.16 gage, use with
Repeatability 2.7088 16.253 13.06 caution
Reproducibility 3.1774 19.065 15.34
Part-To-Part 20.2871 121.723 97.95
Total Variation 20.7154 124.274 100
360
Gage R & R– Continuous Data
Step 5: Graphical Output 1
Components of Variation
100 % Contribution
% Study Var
80
60
Percent
40
20
0
Gage R&R Repeat Reprod Part-to-Part
361
Gage R & R– Continuous Data
Step 5: Graphical Output 2
Gage R&R (Xbar/ R) for Data
Reported by:
Gage name: Tolerance:
Date of study: Misc:
_UCL=83.11
_
80 X=77.36
LCL=71.61
60
40
R Chart by Appraiser
A B C
10 UCL=9.98
Sample Range
5
_
R=3.06
0 LCL=0
Interpretation:
All points in R chart should be within the control limits for all Appraisers
Xbar chart for all appraisers should have more or less same pattern and most
of the points should fall outside control limits. 362
Gage R & R– Continuous Data
Step 5: Graphical Output 3
Gage R&R (Xbar/ R) for Data
Reported by:
Gage name: Tolerance:
Date of study: Misc:
Data by Call Id
100
90
80
70
60
50
40
1 2 3 4 5 6
Call I d
Interpretation:
All readings for each call is shown with their means connected. Ideally the
variation around mean for different calls should be equal and minimum.
363
Gage R & R– Continuous Data
Step 5: Graphical Output 4
Gage R&R (Xbar/ R) for Data
Reported by:
Gage name: Tolerance:
Date of study: Misc:
Data by Appraiser
100
90
80
70
60
50
40
A B C
Appraiser
Interpretation:
All readings for each appraiser is shown with their means connected. Ideally
the variation around mean for different appraisers should be equal and
minimum. 364
Gage R & R– Continuous Data
Step 5: Graphical Output 5
Gage R&R (Xbar/ R) for Data
Reported by:
Gage name: Tolerance:
Date of study: Misc:
80
Average
70
60
50
40
1 2 3 4 5 6
Call I d
Interpretation:
Ideally the lines should overlap or at least parallel. Large deviations from
parallelism indicates lack of agreement among appraisers with respect different
calls. 365
Gage R&R for Continuous Data
Data Collection
Transaction 367
Gage R & R: Example
Operator 1 Operator 2
Part 1 2 Range 1 2 Range
1 21 20 1 20 20 0
2 24 23 1 24 24 0
3 20 21 1 19 21 2
4 27 27 0 28 26 2
5 19 18 1 19 18 1
6 23 21 2 24 21 3
7 22 21 1 22 24 2
8 19 17 2 18 20 2
9 24 23 1 25 23 2
10 25 23 2 26 25 1
Rbar 1.2 Rbar 1.5
368
Gage R & R: Example
Trails K1
2 0.8862
3 0.5908
369
Gage R & R: Example
Part 370
Gage R & R: Example
371
Gage R & R: Example
372
Gage R & R: Example
Part Variation:
Part
Rp: Mean max – Mean min = 27.00 – 16.00 = 11
373
Gage R & R: Example
Part Variation:
= 3.4606 2 0.7071
3 0.5231
4 0.4467
5 0.4030
6 0.3742
7 0.3534
8 0.3375
9 0.3249
10 0.314
374
Gage R & R: Example
Total Variation:
Total Variation: √ Gage R &R2 + Part Variation2
Total Variation: √ 1.20942 + 3.46062 = 3.6658
375
Gage R & R: Example
Summary Table:
% Study variation is
Source SD 5.15 x SD % Study Var
32.99% > 30% hence
variation in processing
Repeatability 1.19681 6.1636 32.64 time is not acceptable.
Reproducibility 0.1739 0.8956 04.74
Total Gage R &R 1.2094 6.2284 32.99 Reasons shall be
Part Variation 3.4606 17.8221 94.40 investigated and
improvement plan shall
Total Variation 3.6658 18.8791 100
put in place.
376
Summary of Case Study (Using Minitab)
10 Transactions,
2 Agents
Each Agent processed each transaction twice
Data Collection
Transaction 377
Enter the data in Minitab as shown
Click on columns
as shown
378
% Study variation is
35.28% > 30% hence
variation in processing
time is not acceptable.
Reasons shall be
investigated and
improvement plan shall
put in place.
379
Total Gage R&R. Focus only on Green Bars.
These represents the % of total variation
contributed from the data.
The Gage R&R should be only 10% of total
variation. Rest should be attributed to within
transactions Variation. 35.28% is not acceptable
Part-to-part variation (transaction to
transaction) (estimate of process variation)
381
Exercise 1.17 (20 minutes)
Gage R & R– Continuous Data
382
Gage R&R for Discrete Data
Example: Gage R & R for evaluate appraiser process knowledge
An Engagement Team Lead (TL) considered 10 transaction and chosen 2 appraisers
at random for Gage R&R study. The transactions were evaluated on “Correct” or
“Incorrect” basis. For all the 10 transactions actual results (Standard) are also
available with TL. 2 appraisers processed each transaction twice within gap of one
week. The results are as follows. Study the Gage R&R.
384
Analyze Results
385
Analyze Results
Enter
2,
2,
Radha, Krishna
386
Percent Repeatable
by appraiser
(it should be >=80%)
387
Repeatability Vs Standard
388
Percentage Reproducibility
For all appraisers
(it should be >=80%)
Percentage Reproducibility
For all appraisers Vs Standard
(it should be >=80%)
389
Date of study:
Assessment Agreement Reported by:
Name of product:
Pictorial Representation Misc:
100 100
[ , ] 95.0% CI
90 90
Percent
80 80
70 70
Percent
Percent
60 60
50 50
40 40
30 30
391
Exercise 1.18 (20 minutes)
Gage R & R– Attribute (Discrete) Data
392
Process Capability
393
Process Capability
Process Capability
Refers to the inherent or natural variation of a process
394
Potential capability Cp:
A measure of the ability/potential to meet the customer
specifications
Example 1: Specification: 55 ± 5 Days
Allowed variation = 50 Days to 60 Days
Natural Variation = 52 Days to 58 Days
Example:
Mean = 55 Days & SD = 1 Day
Natural Variation = 55 – (3 x 1) to 55 + (3 x 1)
= 52 Days to 58 Days
396
Potential capability Cp:
397
Potential capability Cp: Example
The Time to Certify Agents in days is given in the table below. If the client
requirement on Time to Certify Agents is 50 to 90 days, check whether
the process has the capability to meet the client requirement ?
85 75 80 65 75 60 80 70 75 60
80 75 70 70 75 75 85 60 50 65
398
Potential capability Cp: Issues
• Cp checks only whether the process has the potential to meet the
requirements
• Cp never checks whether the Process is actually meeting
requirements
399
Potential capability Cp: Issues
Example:
Process: Training Process Characteristic: Time to Certify Agents
Specification : 55 ± 5 Days
400
Potential capability Cp: Issues
Example:
Process: Training Process Characteristic: Time to Certify Agents
Specification : 55 ± 5 Days
Process 1 Process 2 Process 3
Cp 1.66 1.66 1.66
Allowed variation 50 to 60 50 to 60 50 to 60
402
Achieved Capability Index Cpk: Graphical Representation
LSL USL
Cpl = a / c
= (Mean – LSL ) / 3 SD
a b
1.2
Cpu = b / d
1
= (USL - Mean ) / 3 SD
0.8
0.6
0.4
0.2
0
1 2 3 4 5 6 7
3 SD Mean + 3 SD
c d
403
Achieved Capability Index Cpk: Example
6 12
Example:
USL : 12 LSL: 6
Mean : 9 SD : 1
3 3
1.2
Cpu = 3 / 3 = 1
1
Cpl = 3 / 3 = 1
0.8
0.6
Cpk = Min [1 , 1] = 1
0.4
0.2
0
Cpk = 1
6 7 8 9 10 11 12
- 3 SD Mean + 3 SD
3 3
404
Achieved Capability Index Cpk: Example
6 12
Example:
USL : 12 LSL: 6
Mean : 8 SD : 1
2 4
1.2
Cpu = 4 / 3 = 1.33
1
Cpl = 2 / 3 = 0.66
0.8
0.6
Cpk = Min [1.33, 0.66] = 0.66
0.4
0.2
Cpk < 1, Process doesn’t meet the
0
customer requirements.
5 6 7 8 9 10 11
- 3 SD Mean + 3 SD
3 3
405
Achieved Capability Index Cpk: Example
6 12
Conclusion:
Cpu = 3 / 3 = 1
Cpl = 3 / 3 = 1
Cpk = Min [1 , 1] = 1
3 3
1.2
1
Cp = (USL – LSL) / 6 SD = 6 /6 = 1
0.8
0.6
When process Mean is at center of
0.4 Specification then
0.2
0
Cpk =Cp
6 7 8 9 10 11 12
- 3 SD Mean + 3 SD
3 3
406
Potential capability Cp: Issues
Example:
Process: Training Process Characteristic: Time to Certify Agents
Specification : 55 ± 5 Days
407
Relationship of Cp and Cpk
USL
LSL
Cp =2 Cpk = 2
Cp =2 Cpk = 1.5
Cp =2 Cpk = 1
Cp =2 Cpk = 0
Cp =2 Cpk = -0.5
Mean
408
Exercise 1.19 (20 minutes)
Process Capability
409
Process Sigma Level Calculations
410
Process Capability for Continuous Data
General Guidelines
6. Still, data is non-normal, recheck the data or check whether the data fit in
any non-normal distribution.
411
Process Capability for Continuous Data
412
Data Transformation
Transformed data for Y may be in the form of Y2, Y3, Y0.5, Ln(Y) etc.
413
Process Capability for Continuous Data
Example 1
The cycle time (in Minutes) of each transaction in a day on both the shifts
was collected. The SLA for the cycle time of the process is 60min.
Calculate the process capability.
50 1
51 1
50 1 414
Stability Test
Select Stat>Control Charts>
Variable charts for Individuals> I-
MR chart
Click OK
415
Stability Test
I-MR Chart of Cycle Time_ 1
UCL=62.65
60
I ndividual Value
55
50
_
X=51.37 All the points in the I-MR control
45 chart are within control limits. No
40
1 4 7 10 13 16 19 22 25 28
LCL=40.09
significant trends also.
Observation
15
UCL=13.86
So, it is a stable process.
Moving Range
10
5 __
MR=4.24
0
1 4 7 10 13 16 19 22 25 28
LCL=0 Note:
Observation
If there are any out of control
point, the related data to be
analyzed and eliminate the
assignable cause. Then, remove
that data point and continue.
416
Select Normality Test
Stat>Basic Statistics> Normality Test
60
50
40
30
20
10
P-Value is great than 0.05.
5 So, it is a normal Distribution.
1
40 45 50 55 60
Cycle Time_ 1 Since the data is satisfying all the
pre-requisites, we can calculate
the process capability for this
process.
417
Capability Test
Select
Stat>Quality Tools>Capability Analysis>Normal
Enter 1
Click OK
418
Select Stat>Quality Tools>Capability Analysis
Capability Test
Process Capability of Cycle Time
USL
Process Data Within
LSL * Overall
Target *
USL 60 Potential (Within) Capability
Sample Mean 51.3667 Cp *
Sample N 30 CPL *
StDev(Within) 3.76009 CPU 0.77
StDev(O verall) 4.24218 Cpk 0.77
O verall Capability
Pp *
PPL *
PPU 0.68
Ppk 0.68
Cpm *
40 45 50 55 60
O bserved Performance Exp. Within Performance Exp. O verall Performance
PPM < LSL * PPM < LSL * PPM < LSL *
PPM > USL 0.00 PPM > USL 10836.64 PPM > USL 20919.46
PPM Total 0.00 PPM Total 10836.64 PPM Total 20919.46
Ppk =0.68
Zlt = (3 * Ppk) = 2.04
Zst = (3 * Ppk)+1.5 = 3.45
DPMO = 20919.46
419
Process Capability for Continuous Data
Example 2
HR is working on reduction of recruitment cycle time. 30 data points are
collected to set the baseline capability, as shown below. The SLA is 60 days.
Calculate the baseline capability of the process.
50
51
50 420
Stability Test
Click Recruitment
Cycle time
Click OK
421
Stability Test
55
50
_
X=51.37 control limits. No significant trends
45 also.
LCL=41.28
40 1
1
1 4 7 10 13 16 19 22 25 28
Observation
So, it is a not a stable process.
12 UCL=12.39
Moving Range
3
__
MR=3.79 control points, the related data to
0 LCL=0 be analyzed and eliminate the
assignable cause. Then, remove
1 4 7 10 13 16 19 22 25 28
Observation
422
Normality Test
Select Stat>Basic Statistics> Normality Test
60
50
40
30
20
So look for the transformation.
10
1
40 45 50 55 60
Recruitment Cycle time
423
Select Data Transformation
Stat>Control Charts>Box-Cox
Transformation
Ensure dot on
top option
Click Recruitment
Cycle time
Enter 1
Enter C2
It store the
Click on transformed data
Options in C2 column
Click Ok
424
Data Transformation
Box-Cox Plot of Recruitment Cycle time
Lower CL
4.2 Lambda
(using 95.0% confidence)
Estimate 3.03
4.0 Lower CL -1.26
Upper CL
3.6
Limit
3.4
3.2
-5.0 -2.5 0.0 2.5 5.0
Lambda
425
Data Transformation
Select
Stat>Basic Statistics> Normality Test
60
50
40
30 So, The transformed data is
following normal Distribution.
20
10
capability
426
Select Stat>Quality Tools>Capability Analysis>Normal Capability Test
Click on Box-Cox
Click Rec. cycle
time Enter 1
Enter 60 in Upper
Spec.
Click others
427
Select Capability Test
Stat>Quality Tools>Capability Analysis
Process Capability of Recruitment Cycle time
Using Box-Cox Transformation With Lambda = 3
USL*
Process Data transformed data Within
LSL * O verall
Target *
USL 60 Potential (Within) Capability
Sample Mean 51.3667 Cp *
Sample N 30 CPL *
StDev(Within) 3.36268 CPU 1.00
StDev(O verall) 4.15021 Cpk 1.00
LSL* * Pp *
Target* * PPL *
USL* 244230 PPU 0.84
Sample Mean* 155371 Ppk 0.84
StDev(Within)* 29657.1 Cpm *
StDev(O verall)* 35265.1
Ppk =0.84
Zlt = (3 * Ppk) = 2.52
Zst = (3 * Ppk)+1.5 = 4.02
DPMO = 5872
428
Process Capability for Attribute Data
We can use Capability Analysis (Binomial) if the data meet the following
conditions.
429
Process Capability for Attribute Data - Example
A Black belt is working on project to reduce the defective transaction in a
process. He has collected data for 30 days as shown below.
Sl No Trasa
1
2 Enter the this data in Minitab
3 430
Capability Test
Select
Stat>Quality Tools
>Capability Analysis>Binomial
Target, by default 0.
Value can be entered if there
is any target.
Click OK
431
Capability Test Binomial Process Capability Analysis of Defect
P Chart
% Defective
Proportion
process is in a state of control. 0.2
_
P=0.2093
LCL=0.0367
In this case there is no out of control 0.0
1 4 7 10 13 16 19 22 25 28
Sample
point. Tests performed with unequal sample sizes
Cumulative % Defective
Summary Stats
The proportion defective is 20.93%. 22.8 (using 95.0% confidence)
% Defective: 20.93
21.6
% Defective
Lower CI : 18.90
Upper CI : 23.07
Cumulative % defective is the 20.4
19.2
Target:
PPM Def:
0.00
209302
defective. 5 10 15 20 25 30
Process Z:
Lower CI :
0.8088
0.7364
Sample Upper CI : 0.8816
Dist of % Defective
Data should appear randomly distributed.
ar
433
1 4 7 10 13 16 19 22 25 28 45 50
Sample Sample
Tests performed with unequal sample sizes
% Defective
30
Proportion
% Defective
0.2 P=0.2093
20 Upper CI: 23.07
0.0
LCL=0.0367 20.4
10
Target: 0.00 3.0
1 4 7 10 13 16 19 22 25 28
Sample 19.2
45 50
Sample Size
55
PPM Def: 209302
Tests performed with unequal sample sizes Lower CI: 189000 1.5
Cumulative % Defective
Summary Stats 18.0 Dist of % Defective Upper CI: 230745
(using 95.0% confidence)
6.0
Tar
Process Z: 0.8088 0.0
22.8 %Defective: 20.93 5 10 15 20 25 30 0 5 10 15 2
Lower CI: 18.90 Lower CI: 0.7364
21.6 4.5 Sample
% Defective
Capability Test
Results:
P-chart indicates that process is stable as there are no data points out of
control
The chart of cumulative % defective show that the estimate of the overall
defective rate appears to be settling down around 21%.
The process Z is around 0.8, which is very poor. This process could
use a lot of improvement
434
Process Sigma Multiple for Discrete Data
Terminology
Unit:
A unit is the tangible & measurable characteristic of a process input / output.
Defects are observed / counted in the output characteristic of a unit (Denoted as Y)
Examples:
Every Call received by a call center Agent: Unit= Call
Each employee recruitment cycle time Unit = Employee
Each transaction processed by agent Unit = Transaction
The transaction not meeting the customer requirement Unit: Transaction
Non-availability of system Unit = System
Defect:
• A defect is a failure to conform to requirements
• Any type of undesired result is a defect.
A failure to meet one of the acceptance criteria of a customer.
• A defective unit may have one or more defects.
435
Specification Vs Characteristic
Specification is a customer-defined tolerance for the output unit value.
There may be two sided specifications.
Specification form the basis of any defect measurement exercise on continuous data
436
Opportunity for Defect:
Any critical characteristic which is routinely inspected before passing the item is an
opportunity for defect.
(or)
Opportunity for the error in a process is the number of steps / task / actions in the
process, where there is a possibility of committing error, that may result in a
defect.
Concept of OFD is applicable only when defect measurement is discrete.
e.g. Operational definitions may determine if a team is to count all the defects on
an invoice (required to calculate defects per million opportunities) or the total
number of defective invoices (any invoice with any defect) or the type of defects
encountered on an invoice (to eliminate the most common defects first). Each of
these cases may require a very different approach for gathering the data”
437
Examples:
• For example, if client wants to ensure that each transactions to be completed
with in 20 min, it can be considered as specification and follow the continuous
data path.
• In some cases, client may scope the improvement area. In that situation,
team can consider only that portion and identify the Opportunities for Defects.
438
Examples:
439
Exercise for DPMO calculation for Discrete data
The Inspection result for a set of 100 Purchase Orders (PO) are given in the Table
below:
Cause of Rejection Number of Defects
Number of Defects =
Number of Opportunities for Defects =
440
DPU: Defects Per Unit
The ratio of Number of Defects found to the total Number of Items Inspected
Number of Defects = 10
DPU = Number of Defects / Total Number Units Inspected = 10 / 100 = 0.1
441
DPO: Defects Per Opportunity
442
DPMO: Defects Per Million Opportunity
443
Yield:
Yield = e-DPU
Cause of Rejection Number of Defects
444
ZST: Short Term Sigma Value
445
ZLT : Long Term Sigma Value
ZLT = ZST - 1.5
DPO = 0.025
ZST = 1.96 From conversion tables
ZLT = ZST - 1.5 = 1.96 - 1.5 = 0.46
446
Exercise 1.20 (20 minutes)
Sigma level calculations
447
Some Helpful Hints:
• It is always preferable to deal with continuous data. Continuous data is
measured on a continuum or scale.
• Collect the cause data along with performance data for initial quick wins.
Once you determine the entire processes, collect the additional data
related to those causes.
• Always evaluate the colleted data, before calculating the base line
capability
448
Some Helpful Hints:
• Proportion Defective: The entire unit is either good or bad. A proportion
can be calculated. Assume Binomial
• Count of defects: There is no limit to the number of defects that can be
counted. Assume poison.
• Calculate Zlt value using Ppk (noted in Minitab output) instead of Cpk, as
Ppk is represents the long term process capability
• Not all the percentages are discrete or count data. Eg. % system
availability. If both the numerator and denominator are determined by
measuring the % is considered continuous data.
449
Table 1: Raw data on Transaction time of express Teller
Exercise Woking Transaction Times(sec)
day
D & M Phase Appraiser A Appraiser B Appraiser C
deliverables 1
2
63
69
55
63
56
60
53
65
61
61
64
66
3 57 60 61 65 66 62
Deliverables 4 58 64 60 61 57 65
5 79 68 65 61 74 71
1 Type of data 6 55 66 62 63 56 52
6 Normality Test 11 57 63 56 64 62 59
9 Gauge R & R 14 68 67 59 58 65 59
15 70 62 66 80 71 76
16 65 59 60 61 62 65
17 63 69 58 56 66 61
18 61 56 62 59 57 55
19 65 57 69 62 58 72
20 70 60 67 79 75 68
450
Week 1 Define & Measure Phase
Sigma level calculations
451
Thank You
452