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How to plan for an effective Six Sigma How to plan for an effective Six Sigma Implementation in your OrganizationImplementation in your Organization

(Workshop)(Workshop)Dr. David Tan, Motorola UniversityDr. David Tan, Motorola University

Corporate University Conference Corporate University Conference Johannesburg, , South AfricaJohannesburg, , South Africa

6th May 20106th May 2010

Workshop AgendaWorkshop Overview

LeadershipJumpstart

Project Selection

• Workshop Overview • Leadership Jumpstart

•Team Activity- Identifying of Strategic Objectives and Customers Expectations

•Team Activity- Identify the Big "Y" and Vital "x"•Project Selection:

•Team Activity- Identifying the Six Sigma Projects•Project Implementation

Workshop OverviewWorkshop Overview

LeadershipJumpstart

Project Selection

•Overview of Six Sigma Business Improvement Campaign

•Phases in Jumpstart and Project Selection Process

Overview of Six Sigma Business Improvement Campaign

1

Phases Processes

Leadership JumpstartLeadership Jumpstart

Governance for S

ustainabilityG

overnance for Sustainability

Project SelectionProject Selection

Project ClosureProject Closure

Project ImplementationProject Implementation

Voice of Customers, Market,

Shareholders & Technology

YBalanced Scorecard

Phase 1- Jumpstart Processes & Deliverables

ASSESSMENTASSESSMENT


Voice of Customers, Market, Shareholders & Technology

Y

Balanced Scorecard

“Deliverables”1. VOC2. Financial Data3. Performance Data4. Scorecard5. WIP Project Review 6. Sponsor Alignment

Identification ofKRA and Big Ys’(KPI)

Identification ofKRA and Big Ys’(KPI)

VOC= Voices of CustomerCustomer Expectations Practice in Workshop

Phase 2 – Project Selection Processes & Deliverables

“Deliverables”1. Schematic Creation2. Root Cause Analysis3. Vital Few Analysis4. Project Identification

Identification ofVital Xs’ and Projects

Identification ofVital Xs’ and Projects


DRIVERSDRIVERS

VITAL X’SVITAL X’S

Practice in Workshop

Phase 3 – Project Implementation

“Deliverables”1. Charter Creation2. Resource Allocation3. Sponsor Review &

Approval4. Governance Plan

Creation ofProject Charter and Governance Plan

Creation ofProject Charter and Governance Plan


CHARTERSCHARTERS

GOVERNANCEGOVERNANCE

Covered in Workshop

Leadership JumpstartWorkshop Overview

LeadershipJumpstart

Project Selection

•Assessing Current Situations

•Team Activity- Identifying of Strategic Objectives and Customers Expectations

•Team Activity- Identify the Big "Y" and Vital "x"

Phase 1- Jumpstart Processes & Deliverables(Assessing Current Situations)

1

Phases Processes


Governance for S

ustainabilityG







YBalanced ScorecardIdentify of (VOC) Customer Expectations and Score Card

What Do Customers Want?The challenge is to understand how your customers define and prioritize the various needs and expectations they have of your products and services.

QualityProduct or Service Features, Attributes, Dimensions, Characteristics Relating to the Function of the Product or Service, Reliability, Availability, Taste, Effectiveness - Also Freedom from Defects, Rework, or Scrap.

Cost Prices to Consumer (Initial Plus Life Cycle), Repair Costs, Purchase Price, Financing Terms, Depreciation, Residual Value.

Delivery Lead Times, Delivery Times, Turnaround Times, Setup Times, CycleTimes, Delays.

Service & SafetyService Requirements, After-Purchase Reliability, Parts Availability, Service, Warranties, Maintainability, Customer-Required Maintenance, Product Liability, Product/Service Safety.

CorporateResponsibility

Ethical Business Conduct, Environmental Impact, Regulatory and Legal Compliance.

Example: Voice of the Customer

• Meet or exceed product/service expectations.• Communicate order status.• Provide products customized for each specific

application.• Easy access to information throughout the buy-build-

install cycle.• Provide product that works.• Provide more value.• 24 X 7 immediate availability on support services.

Voice of the CustomerWhat are the key expectations for your business?

Scorecard Assessment

• Review current scorecard and capture what’s important to the stakeholders.

• Determine if it corresponds to items important to them gathered from the VOC collection.

• * If a Scorecard is not available, then reference to the Business Plan/KPIs/Organization Goals, etc.

Balanced Scorecard

- Investment Rate - Illness rate - Internal Promotions % - Employee Turnover - Gender/Racial Ratios

- Number of Activities - Opportunity Success Rate - Accident Ratios - Overall Equipment

Effectiveness

- Delivery Performance to Customer - by Date

- Delivery Performance to Customer - by Quality

- Customer satisfaction rate - Customer Loyalty - Customer retention

- Financial- Cash flow - ROI - Financial Result - Return on capital

employed - Return on equity

PeopleProcessCustomerFinancialBalanced Scorecard



Effectiveness






PeopleProcessCustomerFinancial

ASSESSMENTASSESSMENT

Activity Format

Brainstorm SortConsolidate Prioritize

Item oneItem twoItem threeItem fourItem fiveItem six

Poster and post-it note driven.

General to specific, small teams to large group roll up.

“Drill down” to deeper clarity and real insight.

Identifying of Strategic Objectives and Customers Expectations

In your team….• Review current scorecard and capture what’s

important to the stakeholders.• Determine if it corresponds to items important

to them gathered from the Customer Expectations.

Balanced Scorecard



Effectiveness






PeopleProcessCustomerFinancialBalanced Scorecard



Effectiveness






PeopleProcessCustomerFinancial

TEAMACTIVITY

30 mins

V oic e o f t h e C us t o m e r / S t a k e ho lde r

What are your customer/stakeholders’ key expectations?“In order to meet my expectations, you must …”

Step 1

Inventory

V o ic e o f t h e C us t o m e r / S t a k e ho lde r

What are your customer/stakeholders’ key expectations?“In order to meet my expectations, you must …”

Step 1

Inventory

Customer ExpectationsCustomer

Expectations

KRA/KPI, Business Plan/Organization Goals

KRA/KPI, Business Plan/Organization Goals

Phases Processes


Governance for S

ustainabilityG



Phase 2 – Project Selection Processes & Deliverables(Schematic Creation)





YBalanced Scorecard

1

The Leadership Challenge – Keeping a Focus on the Big “Ys”

Results that matter Which activities will enable you to achieve those results?

Y = f (1x1 , 10x2 , 2x3 ... )

On-going Sponsorship and Review

Six Sigma Project

Selection

1

Identify the Key Metrics (Y’s)

y1 y3 Y4yn

YY

Y2

X5 X7 X8 X12 1X132X3 X14X4 10X9 XnX10X1 1X2 X115X6

X3 X5 X6 X8 2X9X1 X101X2 X4 5X7 10Xn

1

ProfitabilityBig Y’s Revenue GrowthQuality Engineering

Effectiveness

Customer Reported Defects

Engineering Productivity

CompetitiveDifferentiation

Emerging Market Gross

Margins

ProductCost

Reductions

Little Y’s

EngineeringCost of Quality

Product Reliability

Cycle Time Innovation to CommercialAvailability

CustomerLoyalty

Common Platform

Q R P E

1

2

3

4 Right the First Time

Product Gaps

Program Execution

Portfolio Planning

Example of Key Metrics (Y’s)

What are the right “Y’s” for monitoring your business performance and how do they link together?

In your team, brainstorm the key metrics that are the best indicators of business performance.

Capture on post-it notes (one idea per note).

Post on the Poster.

Ask, “Is this a metric or an activity?”

Identify the Big "Y" and Vital "x"

Litt l

e Y’

sVi

tal X

The

Bi g

“Y”

Searc hing for t he Right “ Y’s”

Litt l

e Y’

sVi

tal X

The

Bi g

“Y”

Searc hing for t he Right “ Y’s”

TEAMACTIVITY

30 mins

Project SelectionWorkshop Overview

LeadershipJumpstart

Project Selection

•Six Sigma Project Identification

•Project Alignment and Definition

•Team Activity- Identifying the Six Sigma Projects

Phases ProcessesLeadership JumpstartLeadership Jumpstart

Governance for S

ustainabilityG



Phase 2 – Project Selection Processes & Deliverables(Projects Identification and Selection)





YBalanced Scorecard

1

Assign importance weightage here --> 9 10 9Criteria Category -->

Project Ideas: State the ProblemExisting

Six Sigma

project?

Ranking Total Strategic gap "Big Y"

Important strategic customer

Sales impact or

growth potential

Strategic

Vital X ProjectsPriorityBig X Vital X ProjectsPriorityBig X

Projects Identification (Ideas)Projects Selection

What’s the Output We Want?

Six Sigma Business Improvement

Campaign Targets and Metrics

ImprovementProject “A”

4-6 months forinitial campaign

ImprovementProject “B”

ImprovementProject “C”

The Leadership Challenge – Keeping a Focus on the Big “Ys”

YResults that matter Which activities will enable you

to achieve those results?

= f (1x1 , 10x2 , 2x3 ... )

On-going Sponsorship and Review

Six Sigma Project

Selection

Six Sigma Project Identification

Perform Project

Project Readiness Assessment

Strategic Goals

Vital Drivers

Key Processes

Issue Statements/ Goal Prioritize Projects

Impact Performance

ProjectDefinition

ProcessDefinition

X

Y

Successful deployment of Six Sigma requires alignment to Strategic Goals and definition of projects at the process level of the business

Alignment? And Significant Impact?

Manageable Scope?4-6 months

Example - Six Sigma Project Identification

Perform Project

Project Readiness Assessment

BIG “Y” Operating Earnings Little “y” Cost of Poor Quality

Vital Drivers Excess & Obsolete

Key Processes Life Time Buy

Issue StatementsMinimize LRP Variation in LTB Process

Run Methodologies DMAIC, DMADDD, DMADV

Life Time Buy Project

Impact Performance

ProjectDefinition

ProcessDefinition

X

Y

Example - Six Sigma Project Identification

Current and

Future Economic

Profit

Return on

capital

Cost of capital

Growth

Operating margin

Net asset turnover

Revenue Management

Cost Management

Fixed asset management

Working capital

management

Are

as t

o A

pply

Six

Sig

ma

Proj

ect

• Customer retention• Revenue per customer• Service Speed• Service Quality

•Yield•Cycle time•Productivity•Service / Product

Performance

•Facilities utilization•Capacity utilization•Technology utilization

• Inventory turnover•Accounts receivable days•Accounts payable days

•Market penetration•Market development•Service / product

development

Project Ideas (Examples)Big X Vital X Priority Projects

Conversion Cost

Overall Productivity -Machine

Overall Productivity -Personnel

Overall Productivity -Process

Overall Productivity -Machine

Overall Productivity -Process

1 1. To increase machine efficiency on liquid production line

2. To increase machine efficiency on solid production line

3

Conversion Cost

2 1. To increase operator efficiency at Back-End line

2. To increase QA operator efficiency

Conversion Cost

3 1. To reduce schedule variability for consumer healthcare products

3 1. To optimize machine utilization

1. To improve in-process control for blistering section for product X line

Six Sigma Project Criteria

• Impacts a key business goal• Requires analysis to uncover root cause• Has cross-function/cross-business impact• Addresses customer pain• Focuses on a key business process• Produces quantifiable results

• A minimum of $50K for Green Belt projects (example)• A minimum of $100K for Black Belt projects (example)

• Achievable in time to make a difference • Average 4 months for Green Belt projects• Average 6 months for Black Belt projects

Project PrioritizationSample Template

Assign importance weights to criteria. Weight assigned is

for illustration.

Revise criteria accordingly. Criteria

shown is for illustration.

List all identified improvement opportunity

project ideas here. Projects shown here are

for illustration.

Score the projects as a team by rating (Use any scale desired. Example: Use numbers 1-10 or a one (1) for correlation

and zero for low correlation, etc.).

Identifying the Six Sigma ProjectsTEAM

ACTIVITY

20 mins

What specifically could we improve that would have direct impact on each priority performance driver?

Identify the vital/key drivers (x’s) that are aligned to the Y’s

Identify the processes/projects that are aligned to the vital/key drivers (x’s)

Prioritize the projects identified.Use post-it notes (one x and process per post-it note).

In your team…(assign by common “application” or Y’s)Vital X ProjectsPriorityBig X Vital X ProjectsPriorityBig X

Assign importance weightage here --> 9 10 9Criteria Category -->

Project Ideas: State the ProblemExisting

Six Sigma

project?

Ranking Total Strategic gap "Big Y"

Important strategic customer

Sales impact or

growth potential

Strategic

Project Ideas (Template)Big X Vital X Priority Projects

Six Sigma Projects Identification- Drill Down Format

Y =

‘y’ = ‘y’ ‘y’

‘x’ = ‘x’ = ‘x’ = ‘x’ = ‘x’ = ‘x’ =

Projects Projects Projects Projects Projects Projects

Phases ProcessesLeadership JumpstartLeadership Jumpstart

Governance for S

ustainabilityG



Phase 3 – Project Implementation(Charter Creation and Governance Plan)





YBalanced Scorecard

1

Why develop a Team Charter?

• Create a single-page summary of the project

• Establish a contract between Stakeholders and Team Members

• Clearly establish the reasons for change

• Communicate the key milestones of the project

Project Charter Elements

Elements of a Team Charter:

• Business Case: Purpose

• Opportunity Statement: Business Impact

• Goal Statement: Success Criteria

• Project Scope: Boundaries

• Project Plan: Activities

• Team Selection: Who and What

Team CharterBusiness Case¨ Why should we do

this?

Opportunity Statement¨ What ‘pain’ are we

experiencing?¨ What is wrong?

Goal Statement¨ What are our

improvement objectives and targets?

Project Scope¨ What authority do we

have?¨ What processes are

we addressing?¨ What is not within

scope?

Project Plan¨ How are we going to

get this done?¨ When are we going to

complete the work?

Team Selection¨ Who are the team

members?¨ What responsibilities

will they have?

Projects Charters

Project 1:To increase

machine efficiencyon liquid

production line


QA operator efficiency

Project 4:To optimize

machine utilization


machine efficiency onsolid production line

Map project to key stakeholders (sponsor, champion, belt candidates)

Barriers/Pitfalls to avoid


Team CharterTeam Charter

StakeholderStakeholderAnalysisAnalysis

Customer Customer RequirementsRequirements

Lack of alignment with a strategic priorityInsufficient reasons for changeNo financial estimateCan’t be completed in 3-6 months

No clear & measurable goalsNot staffed with the right people or enough time

Lack understanding of customer experience & needs

Risk Risk AssessmentAssessment Starting projects with no understanding of risk

Ignoring early red flags

Key stakeholders unwilling to try new solutionsKey stakeholders and managers not committed

70% of process initiatives fail due to:

Governance Plan: Project Progress Reporting to Management

D/M D/M D/M A A I I C CNo Project Title Team Leader 1 2 3 4 5 6 7 8 9

1

2

3

4

5

6

7

8

9

Keys

A Improving performance and meeting goal

B Improving performance and moving closer to meeting goal

C Improving performance but not meeting goal

D No progress from last review but still meeting goal

E No progress from last review and not meeting goal

F Not improving but still meeting goal

G Not improving and not meeting goal

Any or in any projectwarrants escalation to project champion and senior management sponsor for remedial actions

Project Coaching Template (Example for D/M phases)

Business Case Opportunity Statement Goal Statement Project Scope Project Plan Team Members Action Plan Process Map Quick Win Opportunities Critical Customer Requirement Prepared Team Input, Process & Output Indicators Operational Definitions . Data Collection Formats & Plans Baseline Performance Productive Team Atmosphere

Legend: Completed, add comment if needed e.g. refinement needed (color blue) Not completed; add comment, what needs to be done (color red) Not applicable (color black)

Project Name: XXX Project Leader: XXX

Date: XXXCoaching Session # X

D M A I C

Annual Cost Saving/Revenues

PLEASE QUANTIFY

Critical Customer Requirement 1. XXX 2. XXX 3. XXX 4. XXX 5. XXX

Project Goals Indicators Baseline Goal Due Date

MU Consultant’s Signature: ________________Project Champion’s Signature:______________

Building Six Sigma Capability

. . . to support a Six Sigma Campaign in your organization

Leadership Jumpstart Event (1 Day)- align with business strategy- secure commitment, prioritize and resource projects

SeniorLeadershipTeam

Project Coaching by Motorola University (MU)

Green BeltsSix Sigma Green Belt Training (5 days)- prepare team members to execute project activities- provide solid foundation of improvement processes and tools

Diagnosis, Project Selection & Organization• Understanding business & Six Sigma Approach• Development of Organization Design• Selection of appropriate six sigma projects

1

Project Definition• Executive workshop• Champion development• Finalize project charter

2

Institutionalize Six Sigma• Horizontal spread to all areas

5

3

Training & Project Work• Green Belt / Black Belt training.• Project initiation & Follow up.

Time

Step

Project Reviews & Completion• Execute projects.• Document and publicize success stories.

4

CalculateROI

3

Six Sigma DeploymentA Comprehensive Approach

Six Sigma Roll Out Plans 2010 - South Africa• Run open Green Belt Classes at Johannesburg – 5 day

classes. This will be called Lean Six Sigma Green Belt Program focus on 2 powerful methodologies – Six Sigma and Lean

• Planned Dates for the 1st open class – July 19 to 23, 2010• Max Class Size –15 Participants, Minimum –8 participants• Pricing Details

• Only Training – USD 2500/-• Training and Certification – USD 2850/-

• In house Programs: Can be offered based on specific requests from Organizations• Minimum Nominations Required – 10 Participants per session• Pricing: To be Determined and firmed after review of scope

• Contact Point from Motorola • Name : Jacob J, Email – [email protected]

Lean Six Sigma Green Belts Certification Process

Lean Six SigmaGB Training

Validation of project &GB skill-set by

MU and candidate’smanagement

Lean Six SigmaGB Exam

MinRequirement

Met?No Final Review

by MU MBBYes Approved? Certified

Green BeltYes

No

Lead aLean Six Sigma

GB Project

Legend

MU – Motorola UniversityMBB - Master Black BeltGB – Green Belt

Thank You