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Operational

Excellence
Six Sigma

Six Sigma: DMAIC; Y=f(x)


Is it a Goal, a Measure, a Process,
a Tool or an expletive deleted?

By Lee Olson
D efine Presentation to INFORMS
Measure
Analyze
Improve
Control
Define
Measure
Objectives Analyze
Improve
Control

 Understand the Basics of the Six Sigma Program


 Understand How Six Sigma Relates to Lean, TOC, TQM
(Theory Of Constraints; Total Quality Management)
 Ability to Define a Strategy and Roadmap for Success

Operational Excellence Training


Define
Measure
Define Analyze
Improve
Control

 Is it a Goal, a Measure, a Process, a Tool or an expletive


deleted?

 Yes

Operational Excellence Training


Define
Measure
Define Analyze
Improve
Control

Six Sigma
 Is a management methodology
• Customer focused
• Data driven decisions
• Breakthrough performance gains
• Validated bottom line results

Operational Excellence Training


Define
Measure
Customer Focused Analyze
Improve
Control

ON TIME DELIVERY (sample)


The percentage of sales order line items that ship complete on or before the original customer promise date, for
all line items shipped in the month.

On-Time Delivery
Pareto of Drivers

Our Performance Compared to Competitors 100%


90%

80%
100%

75%

% Impact
70%
60% 50%
50%

• Complete
25%
40%
Importance to Customers

30% 0%

xyz Cell

Credit Hold

Engineering
Unrealistic

on part abc
Deliveries

Orders on
Always
Supplier

Low Yield
Promise
20%

Late

Change
Orders
Late

Date
Target
10%
0%

• Quality • OTD
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Reason

Top 5 Action Items


Original Due Current

High
Driver Action Description Status Status Description Ow ner Date Due Date
Late Supplier Deliveries Monthly reporting to suppliers on delivery & On Report Cards Implemented. Adam 5/21 5/21
quality metrics. track

Late Supplier Deliveries Arrange face to face meetings with top On Meetings Complete with top 10 Beth 6/15 6/15
offenders. track Suppliers.

Late Supplier Deliveries Review and approve supplier's corrective action Caution Corrective Action Plan in Place for 2 Carlos 7/15 9/15
plan. major Suppliers

xyz Cell Always Late Kaizen Event to focus on improving throughput On Event held 5/1. 25% throughput Doreen 5/21 5/21
by 40% and improve labor efficiency by 35% track improvement in May. Labor Efficiency
Increase of 30%
Unrealistic Promise Date Focus on custom products to provide realistic Problem Continued lack of progress. Re- Earnest 6/15 8/15
ATP based on inventory and leadtime of structured and focused team.
components. Developing detailed plan.

• Training
Moderate-
• Price
• Shared Goals • Complaints to-’Low’

We’re Better They’re Better

Operational Excellence Training


Define

Data Driven Decisions Measure


Analyze
Improve
Control

Y= f (X)
To get results, should we focus our behavior on the Y or X ?

• Y • X1 . . . XN
• Dependent • Independent
• Output • Input-Process
• Effect • Cause
• Symptom • Problem
• Monitor • Control
• Response • Factor

Why should we test or inspect Y, if we know this relationship?

Operational Excellence Training


Define
Measure

Breakthrough performance gains Analyze


Improve
Control

(Distribution Shifted ± 1.5σ )

σσ PPM
PPM
22 3
30
08
8,5
,5 337
7
33 6
66
6 ,8
,8 0
07
7
44 66 ,21
,210
0
55 2
23333
66 3
3.4
.4
Process
Process Defects
Defectsper
perMillion
Million
Capability
Capability Opportunities
Opportunities

Sigma is a statistical unit of measure which reflects process


capability. The sigma scale of measure is perfectly correlated to such
characteristics as defects-per-unit, parts-per million defective, and
the probability of a failure/error.

Operational Excellence Training


I
L mott o BP not ca p m
ri c
e
In
cr
ea
Vo M se
lu at
m er
ia
e lC
In
c. os
w ts
ith
Le
ve
r ag
M e
an
uf
ac
tu
rin
g
Vo
lu
m
e SG
In

Operational Excellence Training


c. &A
No
Le
ve
ra
g e

Ta

Factors
xe
s

La
G W bo
en or r
ki
er
al n g
-5 Ca
% p
Pr ita
ic l
e
Assuming a 10% change in the factor

Re
d
Validated bottom line results

uc
tio
n
Control
Define

Analyze
Improve
Measure
Define
Measure
Define Analyze
Improve
Control

Methodology
 Define
 Measure
 Analyze
 Improve
 Control

Operational Excellence Training


Define

Roadmap Measure
Analyze

Example Improve
Control

Next Project Define


Customers, Value, Problem Statement Validate
Scope, Timeline, Team Project $
Celebrate Primary/Secondary & OpEx Metrics
Project $ Current Value Stream Map
Measure
Voice Of Customer (QFD)
Control Assess specification / Demand
Document process (WIs, Std Work) Measurement Capability (Gage R&R)
Mistake proof, TT sheet, CI List Correct the measurement system
Analyze change in metrics Process map, Spaghetti, Time obs.
Value Stream Review Measure OVs & IVs / Queues
Prepare final report

Validate
Project $
Validate
Project $

Improve Analyze (and fix the obvious)


Optimize KPOVs & test the KPIVs Root Cause (Pareto, C&E, brainstorm)
Redesign process, set pacemaker Find all KPOVs & KPIVs
Validate
5S, Cell design, MRS FMEA, DOE, critical Xs, VA/NVA
Project $
Visual controls Graphical Analysis, ANOVA
Value Stream Plan Future Value Stream Map

Operational Excellence Training


Plan Execute
• Strategic Link to Business Plan defined in Project Selection Process
• Defined Business Impact with Op Ex Champion support
Identify • Structured Brainstorming at all organizational levels
Problem • Cause and Effect Diagrams identifying critical factors
• Primary and Secondary Metrics defined and charted
Operational Excellence

• Multi-Level Pareto Charts to confirm project focus

• Develop a focused Problem Statement and Objective


• Develop a Process Map and/or FMEA
Practical • Develop a Current State Map
Methodology

Problem • Identify the response variable(s) and how to measure them


• Analyze measurement system capability
• Assess the specification (Is one in place? Is it the right one?)

• Characterize the response, look at the raw data


• Abnormal? Other Clues? Mean or Variance problem?
• Time Observation • Spaghetti Diagram • Takt Time
Problem
• Future State Maps • Percent Loading
Definition • Standard Work Combination
• Use Graphical Analysis, Multi-Vari, ANOVA and basic
statistical tools to identify the likely families of variability

• Identify the likely X’s


• 5S • Set Up Time Reduction (SMED)
• Material Replenishment Systems
Problem • Level Loading / Line Leveling
Solution • Cell Design • Visual Controls
• Use Design of Experiments to find the critical few X’s
• Move the distribution; Shrink the spread; Confirm the results

• Mistake Proof the process (Poka-


Yoke) Problem
 What do you want to know?
Problem • Tolerance the process Solving
 How do you want to see what it is that you need
• Measure the final capability to know?
Control
• Place appropriate process controls on  What type of tool will generate what it is that you
need to see?
the critical X’s  What type of data is required of the selected tool?
• Document the effort and results
Execute Plan  Where can you get the required type of data?
• Standard Work • TPM
Based in part on Six Sigma Methodology developed by GE Medical Systems and Six Sigma Academy, Inc. Co. Op. Ex. Methodology Originated by MBBs; D. Braasch, J. Davis, R. Duggins, J. O’Callaghan, R.
Crane
Define

Define Measure
Analyze

Key Items Improve


Control

 Customers, Value, Problem Statement


 Scope, Timeline, Team
 Primary/Secondary & OpEx Metrics
 Current Value Stream Map
 Voice Of Customer (QFD)
(Quality Function Deployment)

Operational Excellence Training


Define

Project Selection Measure


Analyze

Impact Improve
Control

 Business Impact
• Revenue Growth
• Cost Reduction
• Capital Reduction
• Key Business Objectives
• On Time Delivery
• Lead Time
• Quality
• Customer Satisfaction
 Impact on Operational Excellence Metrics

Operational Excellence Training


Define

Evaluate and Rank Suggestions Measure


Analyze

Effort and Risk Improve


Control

 Effort required
• People Resources
• Capital Resources
• Duration of Project
 Probability of success
• Technical Risk
• Data available
• Knowledge of process
• Management Risk
• Aligned with objectives
• Support by value stream manager
 Impact vs. Risk vs. Effort
• Assess ROI (Return On Investment)
• Assign priorities to projects
Operational Excellence Training
Define
Measure
Evaluate and Rank Suggestions Analyze
Improve
Control

Example tool to rank projects


0106-01 Project Rating.xls

Operational Excellence Training


Project Risk =
Project
Ranking Ball Size
Number
n

4 9
6

3 4
Impact

1
3
2

7 5
1 2
8

0
1 2 3 4 5
Effort

Example chart to rank projects 0106-01 Project Rating.xls


Define
Measure
Measure Analyze
Improve
Control

 Establish measurement capability


• Validate the database (transactional)
• Gage R&R (Repeatability & Reproducibility)
• Calibration is not enough
• Many (or most) measurement systems are not capable
• How good is the data you are using to make decisions?

 Fix the measurement system


• Enables calculation of process capability
• Enables calculation of alpha & beta risks

• This step is often skipped

Operational Excellence Training


Define

Analyze Measure
Analyze

(and fix the obvious) Improve


Control

 Find all KPOVs & KPIVs


(Key Process Output Variables; Key Process Input
Variables)
 FMEA, DOE, critical Xs, VA/NVA
(Failure Modes Effects Analysis; Design Of Experiment)
 Graphical Analysis, ANOVA
(Analysis Of Variance)
 Future Value Stream Map

Operational Excellence Training


Define
Measure
Improve Analyze
Improve
Control

 Optimize KPOVs & test the KPIVs


(Key Process Output Variables; Key Process Input
Variables)
 Redesign process, set pacemaker
 5S, Cell design, MRS
(Material Replenishment System)
 Visual controls
 Value Stream Plan

Operational Excellence Training


Define
Measure
Control Analyze
Improve
Control

 Management of Change
• Owned by project champion and value stream manager
• Critical to long term success of project
• Physical and cultural changes
 Measurement controls
• On-going metrics
 Visual Controls
• Enable workers to self-manage the process

Operational Excellence Training


Define

Basic Implementation Measure


Analyze

Roadmap Improve
Control

Identify Customer Requirements

Understand and Define


Entire Value Streams
Vision (Strategic Business Plan)
Deploy Key Business Objectives
- Measure and target (metrics)
- Align and involve all employees
- Develop and motivate
Continuous Improvement (DMAIC)
Define, Measure, Analyze, Improve
Identify root causes, prioritize, eliminate waste,
make things flow and pulled by customers

Control
-Sustain Improvement
-Drive Towards Perfection

Operational Excellence Training


3.0 Improve Customer Focus

3.1
3.2
2.0 Educate/Get Everyone Involved

2.1
2.2
1.0 Improve the Metrics

1.1
1.2

8
7
6
5
4
3
2
1
1
2
3
4
5
6
Your Manager's 1-Year
Breakthrough
Objectives

Train functional leaders as LGBs


Improve On Time Delivery to 98%
Establish tracking of OTD in every cell

Benefits
Conduct interviews with top 10 customers

Objectives
Train leadership team as Lean Green Belts (LGB)
Train workers inhow our products are used by our major customers

Your Annual Breakthrough

Indicator's and Goals


Complete 1 Leadership LGB training course

100% Completion of LGB Projects

Operational Excellence Training


Leaders have ability to map a value stream

Metrics module in all appropriate training sequences

Training projects demonstrate flowdown of metics to


✔ ✔ ✔
✔ ✔

operational level

Develop culture of teams


Trainees participate in customer survey


✔ ✔ ✔ ✔ ✔ ✔ ✔
✔ ✔

Complete 3 functional LGB training courses


✔ ✔ ✔ ✔ ✔ ✔ ✔
Type in
Key:

Bring reps from top 10 customers in for plant tours


-->



4

Implement lean concepts in top 3 volume lines


establish pareto of drivers for OTD


✔ ✔
✔ ✔
✔ Impact

IT
l

Operations


❍ ●

Quality

Engineering
Hoshin
● Owner

Maintenance
❍ ● ❍ ❍ ❍

Resource
m

Marketing




Training
❍ ❍ ❍ ❍ ❍ ❍ ●


Control
Define

Analyze
Improve
Measure

❍ Support
ON TIME DELIVERY (sample)
The percentage of sales order line items that ship complete on or before the original customer promise date, for
all line items shipped in the month.

On-Time Delivery
Pareto of Drivers
100%
90%
100%
80% 75%

% Impact
70%
60% 50%
50%
25%
40%
30% 0%

Engineering
Credit Hold
xyz Cell
Deliveries

Unrealistic

on part abc
Orders on
Always

Low Yield
Supplier

Promise
20%

Late

Change
Orders
Late

Date
Target
10%
0%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Reason

Top 5 Action Items


Original Due Current
Driver Action Description Status Status Description Ow ner Date Due Date
Late Supplier Deliveries Monthly reporting to suppliers on delivery & On Report Cards Implemented. Adam 5/21 5/21
quality metrics. track

Late Supplier Deliveries Arrange face to face meetings with top On Meetings Complete with top 10 Beth 6/15 6/15
offenders. track Suppliers.

Late Supplier Deliveries Review and approve supplier's corrective action Caution Corrective Action Plan in Place for 2 Carlos 7/15 9/15
plan. major Suppliers

xyz Cell Always Late Kaizen Event to focus on improving throughput On Event held 5/1. 25% throughput Doreen 5/21 5/21
by 40% and improve labor efficiency by 35% track improvement in May. Labor Efficiency
Increase of 30%
Unrealistic Promise Date Focus on custom products to provide realistic Problem Continued lack of progress. Re- Earnest 6/15 8/15
ATP based on inventory and leadtime of structured and focused team.
components. Developing detailed plan.
Define
Measure
Does it work?. Analyze
Improve
Control

The top companies in Customer Satisfaction grow MVA at


nearly twice the rate of their poor-performing counterparts.

In Billions $
50
$42
Market Value Added

1999
40
73
companies 30 $23
Ralston
Purina 20
Quaker Oats
Hilton Hotels
Coca-Cola
10
Unilever
etc. 0
Low High
Customer Satisfaction Index Score
Source: American Customer Satisfaction Index, U Michigan, HBR, 2001

Operational Excellence Training


Define
Measure
What about Lean, TOC, TQM Analyze
Improve
Control

 Six Sigma
• Remove defects, minimize variance
 Lean
• Remove waste, shorten the flow
 TOC
• Remove and manage constraints
 TQM
• Continuous Improvement

Operational Excellence Training


Value Stream Map - Current State
6 WEEK Production 90/60/30 day
Forecast Control Forecasts Customer

y
ekl MRP
Suppliers We ax Order Entry
F Demand = 45 per day
Orders/day 2 shifts
= 36 Takt Time
Lead Time - 34 Days Queue = 18.2 Minutes
WEEKLY SCHEDULE = 1.5 Days
Competitive Lead Time
= 3 Days

1X
Daily

I
Coils Stamping S. Weld # 1 Assembly Test Shipping
5 days I I
I I
342 81
I
122 202 90
CT=1sec CT=3 min CT= 15 min CT= 67 min CT= 4 min Lead Time
Co=1 hr. Co=10 min. Co=0 min. Co= 23 min Co=0 =23.6 days
Uptime=85% Uptime=70% Uptime=100% FTY = 67% Uptime=100%
2 shifts 2 shifts Touch Time
1 shift 1 shift 2 shifts
= 89 min

5 days 7.6 days 1.8 days 2.7 days 4.5 days 2 days
1 sec 3 min 15 min 67 min 4 min
Customer Data
Demand = 45/day
On-Time Delivery
Takt Time = 18.2 min 90/60/30 day
6 WEEK Production
Forecast Control Forecasts Customer
Competitive LT = 3 days
y
ekl MRP
Suppliers We ax Order Entry
F Demand = 45 per day
Orders/day 2 shifts
= 36 Takt Time
Lead Time - 34 Days Queue = 18.2 Minutes
WEEKLY SCHEDULE = 1.5 Days
Competitive Lead Time
= 3 Days

1X
Daily

I
Coils Stamping S. Weld # 1 Assembly Test Shipping
5 days I I
I I
342 81
I
122 202 90
CT=1sec CT=3 min CT= 15 min CT= 67 min CT= 4 min Lead Time
Co=1 hr. Co=10 min. Co=0 min. Co= 23 min Co=0 =23.6 days
Uptime=85% Uptime=70% Uptime=100% FTY = 67% Uptime=100%
2 shifts 2 shifts Touch Time
1 shift 1 shift 2 shifts
= 89 min

5 days 7.6 days 1.8 days 2.7 days 4.5 days 2 days
1 sec 3 min 15 min 67 min 4 min
Raw = 5 days Inventory
WIP = 12.1 days 90/60/30 day
6 WEEK Production
Forecasts Customer
FG = 6.5 days Forecast Control

y
ekl MRP
Suppliers We ax Order Entry
F Demand = 45 per day
Orders/day 2 shifts
= 36 Takt Time
Lead Time - 34 Days Queue = 18.2 Minutes
WEEKLY SCHEDULE = 1.5 Days
Competitive Lead Time
= 3 Days

1X
Daily

I
Coils Stamping S. Weld # 1 Assembly Test Shipping
5 days I I
I I
342 81
I
122 202 90
CT=1sec CT=3 min CT= 15 min CT= 67 min CT= 4 min Lead Time
Co=1 hr. Co=10 min. Co=0 min. Co= 23 min Co=0 =23.6 days
Uptime=85% Uptime=70% Uptime=100% FTY = 67% Uptime=100%
2 shifts 2 shifts Touch Time
1 shift 1 shift 2 shifts
= 89 min

5 days 7.6 days 1.8 days 2.7 days 4.5 days 2 days
1 sec 3 min 15 min 67 min 4 min
Flow of Value
Lead Time = 23.6 days
Lead Time
Touch Time = 89 min 90/60/30 day
6 WEEK Production
Forecast Control Forecasts Customer

y
ekl MRP
Suppliers We ax Order Entry
F Demand = 45 per day
Orders/day 2 shifts
= 36 Takt Time
Lead Time - 34 Days Queue = 18.2 Minutes
WEEKLY SCHEDULE = 1.5 Days
Competitive Lead Time
= 3 Days

1X
Daily

I
Coils Stamping S. Weld # 1 Assembly Test Shipping
5 days I I
I I
342 81
I
122 202 90
CT=1sec CT=3 min CT= 15 min CT= 67 min CT= 4 min Lead Time
Co=1 hr. Co=10 min. Co=0 min. Co= 23 min Co=0 =23.6 days
Uptime=85% Uptime=70% Uptime=100% FTY = 67% Uptime=100%
2 shifts 2 shifts Touch Time
1 shift 1 shift 2 shifts
= 89 min

5 days 7.6 days 1.8 days 2.7 days 4.5 days 2 days
1 sec 3 min 15 min 67 min 4 min
Constraints
Max Wip = 7.6 days
OTD, Lead Time
CT (67) > Takt Time (18) 90/60/30 day
6 WEEK Production
Forecast Control Forecasts Customer

y
ekl MRP
Suppliers We ax Order Entry
F Demand = 45 per day
Orders/day 2 shifts
= 36 Takt Time
Lead Time - 34 Days Queue = 18.2 Minutes
WEEKLY SCHEDULE = 1.5 Days
Competitive Lead Time
= 3 Days

1X
Daily

I
Coils Stamping S. Weld # 1 Assembly Test Shipping
5 days I I
I I
342 81
I
122 202 90
CT=1sec CT=3 min CT= 15 min CT= 67 min CT= 4 min Lead Time
Co=1 hr. Co=10 min. Co=0 min. Co= 23 min Co=0 =23.6 days
Uptime=85% Uptime=70% Uptime=100% FTY = 67% Uptime=100%
2 shifts 2 shifts Touch Time
1 shift 1 shift 2 shifts
= 89 min

5 days 7.6 days 1.8 days 2.7 days 4.5 days 2 days
1 sec 3 min 15 min 67 min 4 min
Setup Times
CO = 1 hour
OP Margin, Lead Time
CO = 23 min 90/60/30 day
6 WEEK Production
Control Forecasts Customer
CO = Changeover
Forecast

y
ekl MRP
Suppliers We ax Order Entry
F Demand = 45 per day
Orders/day 2 shifts
= 36 Takt Time
Lead Time - 34 Days Queue = 18.2 Minutes
WEEKLY SCHEDULE = 1.5 Days
Competitive Lead Time
= 3 Days

1X
Daily

I
Coils Stamping S. Weld # 1 Assembly Test Shipping
5 days I I
I I
342 81
I
122 202 90
CT=1sec CT=3 min CT= 15 min CT= 67 min CT= 4 min Lead Time
Co=1 hr. Co=10 min. Co=0 min. Co= 23 min Co=0 =23.6 days
Uptime=85% Uptime=70% Uptime=100% FTY = 67% Uptime=100%
2 shifts 2 shifts Touch Time
1 shift 1 shift 2 shifts
= 89 min

5 days 7.6 days 1.8 days 2.7 days 4.5 days 2 days
1 sec 3 min 15 min 67 min 4 min
Maintenance
Uptime = 70%
OTD, Lead Time
6 WEEK Production 90/60/30 day
Forecast Control Forecasts Customer

y
ekl MRP
Suppliers We ax Order Entry
F Demand = 45 per day
Orders/day 2 shifts
= 36 Takt Time
Lead Time - 34 Days Queue = 18.2 Minutes
WEEKLY SCHEDULE = 1.5 Days
Competitive Lead Time
= 3 Days

1X
Daily

I
Coils Stamping S. Weld # 1 Assembly Test Shipping
5 days I I
I I
342 81
I
122 202 90
CT=1sec CT=3 min CT= 15 min CT= 67 min CT= 4 min Lead Time
Co=1 hr. Co=10 min. Co=0 min. Co= 23 min Co=0 =23.6 days
Uptime=85% Uptime=70% Uptime=100% FTY = 67% Uptime=100%
2 shifts 2 shifts Touch Time
1 shift 1 shift 2 shifts
= 89 min

5 days 7.6 days 1.8 days 2.7 days 4.5 days 2 days
1 sec 3 min 15 min 67 min 4 min
FTY = 67% Quality
6 WEEK Production 90/60/30 day
Forecast Control Forecasts Customer

y
ekl MRP
Suppliers We ax Order Entry
F Demand = 45 per day
Orders/day 2 shifts
= 36 Takt Time
Lead Time - 34 Days Queue = 18.2 Minutes
WEEKLY SCHEDULE = 1.5 Days
Competitive Lead Time
= 3 Days

1X
Daily

I
Coils Stamping S. Weld # 1 Assembly Test Shipping
5 days I I
I I
342 81
I
122 202 90
CT=1sec CT=3 min CT= 15 min CT= 67 min CT= 4 min Lead Time
Co=1 hr. Co=10 min. Co=0 min. Co= 23 min Co=0 =23.6 days
Uptime=85% Uptime=70% Uptime=100% FTY = 67% Uptime=100%
2 shifts 2 shifts Touch Time
1 shift 1 shift 2 shifts
= 89 min

5 days 7.6 days 1.8 days 2.7 days 4.5 days 2 days
1 sec 3 min 15 min 67 min 4 min
Flow of Value
Who is setting the pace?
OTD, Lead Time
What is the pitch time?
6 WEEK Production 90/60/30 day
Forecast Control Forecasts Customer

y
ekl MRP
Suppliers We ax Order Entry
F Demand = 45 per day
Orders/day 2 shifts
= 36 Takt Time
Lead Time - 34 Days Queue = 18.2 Minutes
WEEKLY SCHEDULE = 1.5 Days
Competitive Lead Time
= 3 Days

1X
Daily

I
Coils Stamping S. Weld # 1 Assembly Test Shipping
5 days I I
I I
342 81
I
122 202 90
CT=1sec CT=3 min CT= 15 min CT= 67 min CT= 4 min Lead Time
Co=1 hr. Co=10 min. Co=0 min. Co= 23 min Co=0 =23.6 days
Uptime=85% Uptime=70% Uptime=100% FTY = 67% Uptime=100%
2 shifts 2 shifts Touch Time
1 shift 1 shift 2 shifts
= 89 min

5 days 7.6 days 1.8 days 2.7 days 4.5 days 2 days
1 sec 3 min 15 min 67 min 4 min
Define
Measure
Making it happen Analyze
Improve
Control

Three major roles


 Implementer
• Learns the tools
• Works the process
• Solves day to day problems
 Manager Where do you
• Learns the methodology
• Manages a value stream need to focus?
• Reviews project teams
 Leader
• Establishes the vision for the future
• Sets priorities
• Encourages

Operational Excellence Training


Define
Measure
What Is a Sigma? Analyze
Improve
Control

 A metric that indicates how well a process is performing.


• Higher is better
• Measures the capability of the process to perform defect-free
work
• Also known as “z”, it is based on standard deviation for
continuous data
• For discrete data it is calculated from DPMO

Operational Excellence Training


Define
Measure
Analyze
Improve
The Normal Curve and Capability Control

Units of Measure
Performance
Limit
Area of Yield Probability
of a Defect Units of Measure
µ
µ

Units of Measure

Excellent
Poor Process Process
Capability Capability
VeryHigh VeryHigh VeryLow VeryLow
Probability Probability Probability Probability
of Defects of Defects of Defects of Defects

LSL USL LSL USL

Low
LowSigma
Sigma High
HighSigma
Sigma

Operational Excellence Training

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