mod 1 bbstrategy sept 02

8/12/2019 Mod 1 BBStrategy Sept 02

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1 Visteon Corporation BB Mod #1 Strategy Rev 2.4 9/02

Black Belt Execution

StrategyBlack Belt Training

Module #1


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Agenda Day

Black Belt Strategy

Roles and Responsibilities

Breakthrough Strategy Overview

Six Sigma Metrics


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4/102


Six Sigma Structure

Executive

Senior Leadership

Deployment Director

Deployment Champion Project Champion

Master Black Belt

Black Belt

Green Belt Team Members

Six Sigma Must Flow Top Down!!


5/102


Six Sigma Structure

Executive Management: will set meaningful goals and objectives for the corporation

will drive the implementation of Six Sigma publicly

Champion:

will select Black Belt projects consistent with corporate goals will drive the implementation of Six Sigma through public

support and removal of barriers

Black Belt: will deliver successful projects using the Breakthrough

Strategy will train and mentor the local organization on Six Sigma


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Establish the Vision Articulate the Business Strategy

Provide Resources

Remove Roadblocks

Support the Cultural Change Monitor the Results

Define the Scorecard for Six Sigma and hold others

Accountable for the Results

Align the Systems and Structures with the Changes

taking place Participate with the Black Belts through Project

Reviews and Recognition of Results.


Executive


8/102


Execute the vision through the

organization

Create and maintain passion

Identify and prioritize projects

Share best practices

Remove barriers for Black Belts

Drive and communicate results

Review projectsKeep score through metrics


Champion

Identify Black Beltspick the

best people

Develop the reward and

recognition program for Black

Belts

Coach Black Belts

Champions Mus t Dr ive Six Sigma Through the Funct ion s

Develop a comprehensive training plan

for implementing the Breakthrough

StrategyCommunicate the linkage between Six

Sigma and the business strategyAn area for oppo rtuni ty at Visteon


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Traits of a Champion

Responsible for the success of Six Sigma

efforts and the harmony with other initiatives

Must provide resources for approved projectsand tear down barriers that may exist

Typically 1 Champion for every 3 Black Belts


10/102


Six SigmaCHAMPION

Strategic

Business

Leader

Manager

of

Resources

Agent

ofChange

Mentor

Provide

Infrastructure

SupportProvide Customer FocusProject SelectionDetermine Timing and Sequence of Projects

Set Project GoalsIdentify Necessary Business MetricsDrive Best Practices across all Business UnitsMonitor Business ResultsDeploy Six Sigma for Best ResultsCommunicate Successes


Roles of a Champion


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Six Sigma

CHAMPION

Strategic

BusinessLeader

Manager

ofResources Agent

of

ChangeMentor Provide

Infrastructure

Support

People Resources

Material ResourcesFiscal Resources

Time

Influence


Roles of a Champion


12/102


Six SigmaCHAMPION

Strategic

Business

Leader

Manager

of

Resources

Agent

of

ChangeMentor

Provide

Infrastructure

SupportCreating a Shared Need

Shaping a VisionClear

Consistent

Mobilizing Commitment

Make Changes Last

Monitor Progress to an Improved State


Roles of a Champion


13/102


Six SigmaCHAMPION

Strategic

Business

Leader

Manager

ofResources

An Agent

ofChange Mentor Provide

Infrastructure

Support

Coach

Inspire Black Belts and TeamsDevelop a Career Path for Black Belts

Encourage Acceptance

Recruit, Reward and Recognize Black Belts & Teams

Develop Opportunity


Roles of a Champion


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Six Sigma

CHAMPION

Strategic

BusinessLeader

Manager

ofResources

An Agent

ofChange

Mentor

Provide

InfrastructureSupport

Vision and Mission Statement Metrics and Metrics Manual

Organizational Goals Roles, Responsibilities, Structure

Selection Criteria Rewards and Recognition Criteria

Evaluation Process Certification Policy

Project Selection Process Project Review Process

Budget Process Labor Reduction Policies and Process

How Improvements are Documented


Roles of a Champion


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Champion Skill Set

Champion Skill Blend

100%

100%

100%

20%

20%

10%10%

20%

20%

0% 20% 40% 60% 80% 100% 120%

Barrier Bust er

Project Evaluation

Six Sigma Concepts

Training

Mentoring

Quantitive

Technical Operat ions

Six Sigma Implementat ion

% Invov lement

Ability

Skills


16/102



Master Black Belt

Expert in the tools and conceptsDevelop and deliver training to

various levels of the organization

Assist in the identification of

projects

Coach and support Black Belts

in project work

Participate in project reviews to

offer technical expertise

Partner with the Champions

Passion around Six Sigma and

Cycle time

Lend a hand when necessaryCertify the Black Belts

Facilitate sharing of best practices

across the corporation

Just in time training/technical

resource

Take on leadership of major

programs

Develop, apply and teach new or

modified tools

Understand the big business picture

Work on the deployment of Six SigmaShould spend a minimum of 10% of

their time in training bring back

new skills and methods to the

organization

Master B lack Belts are the Trainers, Faci l i tator and Coaches


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Traits of a Master Black Belt

Typically there is 1 Master Black Belt for

every 10 Black Belts

Master Black Belts have a unique blend ofstrong quantitative, teaching, consulting and

leadership skills

Some companies differentiate betweenCorporate Deployment and Division Project

Master Black Belts


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Master Black Belt Skill Set

Master Black Belt Skill Blend

80%

80%

100%

100%

100%

100%

20%

100%

100%

0% 20% 40% 60% 80% 100% 120%

Barrier Bust er

Project Evaluat ion

Six Sigma Concepts

Training

Mentoring

Quantitive



% Invovl ement

Ability

Skills


19/102


Expert of the Breakthrough

Strategy

Identify project resources

Lead project teams

Teach and coach Breakthrough

Strategy methods and tools

Manage project risk

Complete final report and control plan


Black Belts

Report project status and data

Identify barriers

Insure the results are sustained

Black Belts are Accou ntable for Dr iv ing Projects

Full Time

Deliver results on time


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Traits of a Black Belt

Typically there is 1 Black Belt for every 100

employees

Black Belts are typically selected by executivesand champions, from a pool of the companies

highest potential employees

The Black Belt should be a visible advocate ofthe application of statistical methods and also be

an established leader within the organization


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:


Black Belt

Mentoring:

Cultivate a network of

experts in the factory or on-

site Working with the operators.

Working with the process

owners.

Working with all levels of

management.

Discipline

Specific

Skills

On-the-Job

Experience

On-the-Job

Experience

Statistical Skills

ClassicalClassical

Six SigmaSix Sigma

Support Skills

Discipline

Specific

Skills


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Black Belt

Teaching & Coaching: Provide formal training to

local personnel regarding

new tools and strategies

Become the conduit for

information

Provide one-on-one

support Develop effective teams

Discipline

Specific

Skills

On-the-Job

Experience

On-the-Job

Experience

Statistical Skills

ClassicalClassical

Six SigmaSix Sigma

Support Skills

Discipline

Specific

Skills


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Black Belt

Six Sigma Methods:Advocate of statistical

methods

Serve as the chief Six

Sigma cheer leader

Guide the implementation

of the DMAIC process in

the organization

Further the Six Sigma effort

by promoting new potential

Black Belt

Continuously train

Discipline

Specific

Skills

On-the-Job

Experience

On-the-Job

Experience

Statistical Skills

ClassicalClassical

Six SigmaSix Sigma

Support Skills

Discipline

Specific

Skills


24/102



Black Belt

Identification and Discovery: Find new applications

Identify new projects

Surface new businessopportunities

Connect the business

through the customer and

supplier Seek best practices

Discipline

Specific

Skills

On-the-Job

Experience

On-the-Job

Experience

Statistical Skills

ClassicalClassical

Six SigmaSix Sigma

Support Skills

Discipline

Specific

Skills


25/102



Black Belt

Being involved: Sharing best practices

throughout the organization

Being a spokesperson to

the customer Driving supplier

performance

Getting involved with

executive management Becoming a future leader

Discipline

Specific

Skills

On-the-Job

Experience

On-the-Job

Experience

Statistical Skills

ClassicalClassical

Six SigmaSix Sigma

Support Skills

Discipline

Specific

Skills


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Attributes For Successful Black Belts

Process/Product Knowledge Basic Statistical Knowledge

Communication Skills

Self Starter/Motivated

Open-Minded

Eager to Learn New Ideas

Desire to Drive Changes

Team Player Respected by Others

Track Record on Results


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Black Belt Skill Set

Black Belt Skill Blend

75%

50%

100%

50%

100%

90%50%

100%

100%

0% 20% 40% 60% 80% 100% 120%

Barrier Buster

Project Evaluation

Six Sigma Concept s

Training

Mentoring

Quantitive



% Invov lement

Ability

Skills


28/102



Black Belt Personality Trait

Analytical Expressive

Driving

Amiable

BB

The ideal Black Belt should be balanced between Driving and

Amiable, Analytical and Expressive and be adoptive to switch

among the styles when require


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PlanPlan

TrainTrain

ApplyApply

ReviewReview

6 s

Strategic

Guidelines

Black Belt Training Process

B lack Belt TrainingStrategy

The Black Belt trainingprocess follows the

Breakthrough Strategy

Plan-Train-Apply-Review

(PTAR) model.As should be apparent,

such a model is foundedupon the merits and

benefits most commonlyassociated with a closed-


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Event Cycle Activity Description Duration

1 Initial Meeting and Planning Session 2 days

2 1 Champion Coordination Meeting 1 day

3 1 Session 1: Black-Belt Training 5 days

4 1 On-The-Job Application Exercise 21 days


6 2 Standard Six Sigma Review 1 day









15 4 Session 4: Black Belt Training 5 days

16 On-The-Job Application Exercise

Contingency

15 days

6 days

1st

Month

2nd

Month

3rd

Month

4th

Month

Black Belt Events

17

4

4

C ti L i


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Continuous Learning

After the Black Bel t instruct ion is complete,the cont inuous l i felong learning begins

Continuous Learning

Application and practice

Seminars

Company supplied training

Academics / graduate course work

Affiliations with Professional Societies / Certifications

ASQ, SME, APICS, SAE

Self taught (individual researching / reading)

Working with peers and other widely recognized experts


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Green Belt

Often leader of projects withinnormal scope of job

Responsible for applying all steps

of Six Sigma process

10-20% of time working on

projects Apply the Breakthrough Strategy,

Tools and Methodology in

functional areas

Good quantitative andinterpersonal skills

Part time on Six Sigma

As knowledge grows, Six Sigma

becomes a larger and larger part

of the job Support Black Belts in

completing projects

Help ensure improvements are

sustained

R l d R ibiliti


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Traits of a Green Belt

Can be a future Black Belt or a team member fromthe project organization

Often the process leaders within the projectorganization

Understand Six Sigma methodology and beginning

in the use of statistical tools

Typically at least one Green Belt per project team

R l d R ibiliti


34/102



Green Belt Skill Set

Green Belt Skill Blend

50%

20%

100%

20%

50%

50%70%

70%

50%

0% 20% 40% 60% 80% 100% 120%

Barrier Bust er

Project Evaluation

Six Sigma Concept s

Training

Mentoring

Quantitive



% Invov lement

Ability

Skills

R l d R ibiliti


35/102



Summary Owns vision, direction,

integration, results

Leads change

Full-time

Trains and coaches Black Belts,

Green Belts,

and leaders

Full time

Facilitates problem solving

Trains and coaches Project Teams

Al l employees

Understand vision

Apply concepts to their

job and work area Part-time

Helps Black

Belts

Master BlackBelts

Black Bel ts

Green Belts

Project Team

MembersExecut ives

Champion

Deployment Champions

Implement deployment plans

Project Champions

Implement solutions

Black belt manager

Project-specific

Part-time

R l d R ibiliti


36/102



Communication

Upper management

language of moneyChampions, Black Belts, Master

Black Belts and middlemanagement must be bilingual

Others - language of defects, parts, transactions, etc.

Different Funct ionsin an Organizat ion

Speak DifferentLanguages


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38/102


BreakthroughStrategy

Characterization

Phase 1:Measurement

Phase 2:Analysis

Optimization

Phase 3:Improvement

Phase 4:Control

The Six Sigma Breakthrough Strategy

DefinePhase 0b:

The define phase is typical ly o ver looked

or m inimized in training but has been the

single most source of issues in Visteons

Six Sigm a implementat ion

Recognize

Phase 0a:

Identification

Core Phases of

Black Belt

Projects Cont inued


39/102


BreakthroughStrategy Institutionalization

Phase 5:Standardize

Phase 6:Integrate

The Six Sigma Breakthrough Strategy

The Ins t i tut io nal izat ion ph ase is less talked abou t and

is typical ly no t even addressed in tra in ing, but is an

important part to any Six Sigma effort

Cont inued

B kth h St t


40/102



Road Map

Recognize the need for change

1. Define the Problem

2. Identify the Customer

3. Select Output Characteristic and

Identify Key Process Input andOutput Variables and Graph

Performance

4. Outline the Financial

Considerations of the Project

5. Develop High Level Process Map

6. Scope Project and Outline Scope

on Process Map

Define

Recognize

Identification

B kth h St t


41/102



Road Map7 Define Performance Standards

8 Develop Data Collection Plan

9 Validate Measurement System

10 Conduct Data Collection

11 Perform Graphical Analysis

12 Establish Baseline Product /Process Capability/ FMEA

13 Define Performance Objectives

14 Identify Variation Sources

15 Screen Potential Causes

16 Begin to Discover VariableRelationships

Measure

Analyze

Characterization

Breakthro gh Strateg


42/102



Road Map17 Establish Variable Relationships

18 Develop Alternatives

19 Develop New Process Map

20 Establish Operating Tolerances

21 Conduct FMEA

22 Perform Cost/Benefit Analysis

23 Pilot

24 Validate Measurement System

25 Validate Improvement

26 Determine Process Capability

27 Implement Process Controls

(SPC, Poke Yoke, Reaction Plans)

28 Complete term MSA plans

29 Finalize Documentation

Improve

Control

Optimization

B kth h St t


43/102



Road Map

Tie Six Sigma Projects Together

Identify and Standardize Best in Class

Processes

Modify Organization ManagementProcesses Through Lessons Learned

in Six Sigma Projects

Transform How Day to Day Business is

Performed

Standardize

Integrate

Institutionalization



44/102


Practical Problem Statistical Problem

Statistical SolutionPractical Solution

y fxx xk= ( , ,..., )1 2


Overall Approach

Measure Analyze

ImproveControl

B kth h St t


45/102


Practical Problem

Improve Viscosity yield:

out of specification

Example


Practical Problem

B kth h St t


46/102



( )nxxxfY ,...,=Viscosity 21=

How can we improve Y such that defects to out

of specification viscosity is less than 1%

Example


Statistical Problem

B kth h St t


47/102



Statistical Solution

What are X's?

What is f ?

( )nxxxfY ,...,=Viscosity 21=

What is the opt im al sett ing and

speci f icat ion l im i ts for each key x?


Statistical Solution

B kth h St t


48/102



Statistical SolutionPractical Solution

Change settings and specification

limits for key variables and

implement a control method


Practical Solution

B kth h St t


49/102



Define

Road Map Steps

1. Define the Problem

2. Identify the Customer

3. Select Output Characteristic and Identify Key Process Inputand Output Variables and Graph Performance

4. Outline the Financial Consideration of the Project

5. Develop High Level Process Map

6. Scope Project and Outline Scope on Process Map

B kth h St t


50/102



Define

Purpose

To obtain a clear understanding of the problem to be

addressed

To define the problem and parameters and to

establish well defined boundaries

To identify the input and output variables

To develop roles, responsibilities, process steps,goals and milestones

Breakthro gh Strateg O er ie


51/102



Define

Deliverables

A well defined problem statement, objective and

improvement metric

Identification of the process or products customers

A Y/X diagram or similar graphic to outline the

relationship between the input and output variables

A primary metric trend chart indicating performance A high level process map

A project scope including designation on the process

map



52/102



Measure

Road Map Steps

7. Define Performance Standards

8. Develop Data Collection Plan

9. Validate Measurement System

10. Conduct Data Collection

11. Perform Graphical Analysis

12. Establish Baseline Product / Process Capability / FMEA

13. Define Performance Objectives


53/102



54/102



Measure

Deliverables

Cause and effect matrix and existing FMEA

Cause and effect diagram

Data collection plan

A validated measurement system including a gage R&R

Sufficient data for the analysis phase

A complete graphical analysis including pareto chart, trend

charts, box-plots, histograms, scatter plots and any othergraphical displays required

A baseline capability study including calculation of sigma levels



55/102


The Process

X1 X2 X3

Controllable Inputs

Z1 Z2 Z3

Inputs:

Raw

Materials,

components,

etc.

Uncontrollable Inputs

Y1, Y2, etc.

Quality

Characteristics:

Outputs LSL USL


Measure

Establish the performance baseline



56/102



Analyze

Road Map Steps

14. Identify Variation Sources

15. Screen Potential Causes

16. Begin to Discover Variable Relationships



57/102



Analyze

ANOVA

Data Type

Attr ibuteData

VariableData

1 Propor t ion

2 Propor t ion

Chi-Square

Analys is of

Variat ion

Analys is of

Means

Correlat ion

Regression

F-Test

1-Sample

t-Test

2-Sample

t-Test

ANOVA for

Means

Design of

Exper iments

Possible Tests

ANOVA



58/102



Analyze

Purpose

To uncover potential sources of variation through an

understanding of the relationship between Xs and Ys

To reduce the number of process variables to be

acted on in the improvement phase

To identify and manage high risk inputs



59/102



Analyze

Deliverables

Statistical analysis of significance of X variables with respect to Y

Could be from a series of inference tests, regression, ANOVA

and/or DoE A cause and effect diagram outlining the relationship between X

and Y

The root cause for the problem

An outline of areas for the improvement to address



60/102


The Process

X1 X2 X3Controllable Inputs

Z1 Z2 Z3

Inputs:

Raw

Materials,

components,

etc.


Y1, Y2, etc.

Quality

Characteristics:

Outputs


Analyze

LSL USL

Identify vital few Xs



61/102



Improve

Road Map Steps

17. Establish Variable Relationships

18. Develop Alternatives

19. Develop New Process Map

20. Establish Operating Tolerances

21. Conduct FMEA

22. Perform Cost/Benefit Analysis

23. Pilot

24. Validate Measurement System

25. Validate Improvement

26. Determine Process Capability



62/102



Improve

Purpose

To verify the variable relationship

To identify potential solutions to address the root

cause

To verify the solutions are effective

To document the cost benefit

To ensure the solution is robust



63/102



Improve

Deliverables

Statistical analysis verifying the variable list

A brainstormed list of potential solutions

A new process map

Revised / new operating tolerances

Results for an optimization routine (I.e. EVOP)

Revised FMEA

Cost / benefit analysis

New measurement system assessment (gage R&R)

New capability analysis including calculation of sigma level



64/102



Improve


The Process


Z1 Z2 Z3

Inputs:

Raw

Materials,

components,

etc.

Y1, Y2, etc.

Quality

Characteristics:

Outputs LSL USL

LSL USL

Determine the governing equation



65/102



Control

Road Map Steps

27. Implement Process Controls (SPC, Poke Yoke, Reaction Plans)

28. Complete long term MSA plans

29. Finalize Documentation (S.O.P., W.I., Control Plan, etc)



66/102



Control

Flow Chart

Data Type

Attr ibu te Data Variable Data

Poke Yoke Long Term

MSA Plan

Reaction Plan SPC

p Chart

Update

Documentat ion

P ChartI-MR

Chart

Xbar-R

Chart



67/102



Control

Purpose

To ensure that any gains are sustained for the long

term



68/102



Control

Deliverables

List of Poke Yoke measures

Reaction plans

Updated control plan, work instructions, standard operatingprocedure and operator instructional aides

Control control with statistically driven limits

Trend chart verifying performance at or below target for three

months



69/102



Control

The Process


Inputs:

Raw

Materials,

components,

etc.

Z1 Z2 Z3Uncontrollable Inputs

Y1, Y2, etc.

Quality

Characteristics:

OutputsLSL USL

Implement long-term control methods



70/102


Measure

Analyze

Improve

Optimized Process

30 - 50 Inputs

10 - 15 Xs

8 - 10 Xs

4-8 Critical

Xs

3-6 CriticalXs

ea t oug St ategy

Dynamics of the Strategy

The Funnel Effect

Control


71/102


Six Sigma Metrics

Six Sigma Metrics


72/102


Six Sigma is about ident i fy ing/quant i fy ingand elim inating the Hidden Factory through

Defect Reduct ion and ult im ately Design for 6 Sigm a

90% Yield After

Inspection or Test

Each defect must be detected, repaired and placed

back in the process. This results is Wasted:

Time

Money Resources

Floor Space

Scrap

Rework

Hidden Factory

NOTOK

OperationInputs Inspect Final TestYield

OK90%

Customer Quality

Six Sigma Metrics

Defects and the Hidden Factory

This classic approach to

calculating yield does not

account for the hidden factory.

Described below is any process that meets a customer need

Six Sigma Metrics


73/102


Six Sigma Metrics

RTY Versus First Time Yield

66% 90%

... why not?

Scrap

90%Customer Quality

Rework

Hidden FactoryNOT

OK

Yield AfterInspection or Test

OperationInputs Inspect Final TestYield =

OK

ProcessA B C

90%

Yield

90%

Yield81 % 73 %

Final Test

D

Using final test yield ignores the hidden factory. Final test performance is

a function of inspection & test not actual defect data.

Rolled-Throughput Yield (RTY) Final Test Yield

90%

Yield66 %

90%

YieldRolled Yield

Six Sigma Metrics


74/102


Six Sigma Metrics

What Causes Defects?

Excess Variation due to: Manufacturing processes

Supplier (incoming) material variation

Unreasonably tight specifications (tighter than the

customer requires) Inadequate DesignMargin

Unstable

Parts and

Materials

Insufficient

Process

Capability

Six Sigma Metrics


75/102


g

Dissecting Process Capability

Defects

Process Capability

Inadequate

Design

Margin

Inadequate

Process

Capability

Unstable Parts &

Materials

Defects Acceptable

Premise of 6- sources of variation can be: Identified

Quantified

Eliminated or Controlled

LSL USL

Six Sigma Metrics


76/102


Six Sigma is about ident i fy ing/quant i fy ingand elim inating the Hidden Factory through

Defect Reduct ion and ult im ately Design for 6 Sigm a

90% Yield After

Inspection or Test

Each defect must be detected, repaired and placed

back in the process. This results is Wasted:

Time

Money Resources

Floor Space

Scrap

Rework

Hidden Factory

NOTOK

OperationInputs Inspect Final TestYield

OK90%

Customer Quality

Six Sigma Metrics

Defects and the Hidden Factory

This classic approach to

calculating yield does not

account for the hidden factory.

Described below is any process that meets a customer need

Six Sigma Metrics


77/102


Six Sigma Metrics

RTY Versus First Time Yield

66% 90%

... why not?

Scrap

90%Customer Quality

Rework

Hidden FactoryNOT

OK

Yield AfterInspection or Test

OperationInputs Inspect Final TestYield =

OK

ProcessA B C

90%

Yield

90%

Yield81 % 73 %

Final Test

D

Using final test yield ignores the hidden factory. Final test performance is

a function of inspection & test not actual defect data.

Rolled-Throughput Yield (RTY) Final Test Yield

90%

Yield66 %

90%

YieldRolled Yield

Six Sigma Metrics


78/102


Six Sigma Metrics

What Causes Defects?

Excess Variation due to: Manufacturing processes

Supplier (incoming) material variation

Unreasonably tight specifications (tighter than the

customer requires) Inadequate DesignMargin

Unstable

Parts and

Materials

Insufficient

Process

Capability



79/102



Premise of 6- sources of variation can be: Identified

Quantified

Eliminated or Controlled

Defects

Process Capability

Inadequate

Design

Margin

Inadequate

Process

Capability

Unstable Parts &

Materials

Defects Acceptable

LSL USL

Six Sigma Metrics


80/102


g

How Do We Improve Capability

)X,...,X,X,X(f=Y k321

Our Outputs (Ys) are determined by our Inputs (Xs). If

we know enough about our Xs we can accurately

predict Y without having to measure it.

If we dont know much about our Xs, then we have to

resort to inspection and test (non value added

operations).

By knowing and controlling the Xs, we reduce thevariability in Y, which decreases the number of defects,

improves RTY, cycle time, etc. We can also eliminate

or reduce inspection, test, and rework.

Six Sigma Metrics


81/102


g

Continuous Improvement

Six Sigma is characterized by:

defining critical business metrics

tracking them

improving them using proactive process

improvement


82/102


Six Sigma Metrics

Six Sigmas primary metrics are:

Defects per Unit (DPU)

Rolled Throughput Yield (Yrt) which is directly related toDPU: Yrt= e-DPU

Defects per Million Opportunities (DPMO)

An opportunity for a defect can be developed based on the type

of defects or the steps in a process (each time work isperformed or a movement is made on a product)

Sigma Level which is directly related to DPMO through the

normal distribution


83/102


Six Sigma Metrics

Defects per unit (DPU) drives plant-wideimprovement through the analysis of defects

RTY drives plant-wide improvement throughas a productivity measure

Defects per million opportunities (DPMO)allows comparison of dissimilar products andis a process capability measure

Sigma level is an overall group or

organization capability measure and allowsfor benchmarking within and acrosscompanies


84/102


Six Sigma Metrics Assumptions

The equation for Rolled Throughput Yield (Yrt= e-DPU) is based on the poisson distribution

probability density function

The conversion from DPMO to Sigma Level is

based on the normal distribution - this

conversion can be calculated or looked up on

a conversion chart

Six Sigma Metrics


85/102


Tracking Trends in Metrics

7654321

2

1

0

Month

Dpu

First Six Months of Six Sigma Implementation

Our objective is to track the trends in the Metrics to establish,

based on fact, our improvements. These metrics can be Defects

Per Unit, Parts Per Million Defective, Time, Defects, Rolled

Throughput Yield, etc.

Six Sigma Metrics


86/102


Calculating the Product Sigma-Level

Calculate Defects per Unit (DPU):

DPU=Total # of Defects

Total # of Units Produced

Calculate Defects per Million Opportunities (DPMO):

Go to a Sigma Chart and Estimate the Sigma Level

DPMO= DPO x 1,000,000

Total Opportunities for Error in One Unit

Calculate Defects per Opportunity (DPO):

DPO=DPU

(# of Opportunities for Error in One Unit)

Six Sigma Metrics


87/102


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0.01

0.10

1.00

10.00

100.00

1000.00

10000.00

100000.00

1000000.00

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

Shifted 1.5Shifted 1.5

AA

BB

Z or Sigma ScaleZ or Sigma Scale

PPMDPMO

Axis

Axis

CenteredCentered

Sigma Level is determined by Defects

6 Sigma generates

only 3.4 defects per

mi l l ion oppor tuni t ies

over long term

examination

DPMO Conversion Chart

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Calculating Yield

Calculate Yield

Yield = e-DPU

(Using Poisson Approximation)

Rolled Throughput Yield = Y1*Y2*Y3*Y

(Actual Values)

There is adifference

depending on

what method is

used


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Six Sigma Metrics

There is still much controversy in industry onhow DPU, RTY, DPMO and Sigma Level are

calculated

Different Interpretations of Six Sigma Metrics

Use of alternative methods productivity measures

of First Time Throughput, First Time Yield, First

Run Capability or OEE (Overall Equipment

Effectiveness) in place of TY and multiply the

individual process values together to get a RTY

Only taking the productivity measure at the end of

the last process rather than calculating a rolled

number from each process

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Six Sigma Metrics

Different Interpretation of Six Sigma Metrics Calculating Sigma levels based on productivity

measures like First Time Throughput, First Time

Yield, First Run Capability, OEE (Overall

Equipment Effectiveness), TY and RTY Not calculating the number of defects per

opportunity and using PPM instead of DPMO

Calculating Sigma Level off of Cpk / Ppk

Using DPU to calculate Sigma Level

Using an ad hoc methods to calculate

opportunities for DPMO

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Six Sigma Metrics

Disadvantages of Alternative Methods to DPUand RTY Six Sigma scaling of sigma levels is based

empirical definition using DPMO

Alternative methods may not uncover the hiddenfactory

Alternative methods may mask additional costsincurred to hit productivity goals

Costs and consequently projects are notstatistically correlated to First Time Yield

No compensation factors exist for more complexprocess if opportunities are not considered

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Six Sigma Metrics

Advantages of Alternative Methods to DPUand RTY It is much more straight forward to measure

It is the way that industry has traditionally

measured productivity The is no accounting issues and room for

manipulation of the system in having to calculateDPMO

Cost of Poor Quality and Cycle Time(Throughput) are also important metricsconsidered in Six Sigma

Six Sigma Metrics


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SUPPLIERProcess

Step 1

Process

step 2 CUSTOMERProcess

step 3

RECORD

DEFECTSRECORD

DEFECTS

RECORD

DEFECTS

RECORD

DEFECTSRECORD

DEFECTS

MEASURE

CONTROL

IMPROVE

ANALYZE

CONTINUOUS IMPROVEMENT MODELPROCEDURE

TIME

GOAL

TREND CHART

ACTION PLANACTION NAME DATE

Vital Few

Identification

Continuous Improvement

The following visual illustrates how the system can work

Y1 Y2 Y3 Yrt

Six Sigma Metrics

E l f Di M f i


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Line Process

1 Tank Line

2 Paint Line

3 Core

4 Insulation

7 Core/Coil

9 Tanking

10 Fit for Ship11 Block&Braze

12 Tank Storage

13 Engineering

14 Purchasing

The following example tracks actual production data forone month in a transformer factory. Listed are the

process steps. Notice engineering and purchasing are

listed as well.

Example from Discrete Manufacturing

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Process Steps, Defects, Units and DPU (1)

Line Process Def Units DPU

1 Tank Line 10,166 17,671 0.58

2 Paint Line 3,992 20,292 0.20

3 Core 2,096 38,397 0.05

4 Insulation 120 18,924 0.017 Core/Coil 302 15,757 0.02

9 Tanking 720 14,874 0.05

10 Fit for Ship 895 13,598 0.07

11 Block&Braze 379 17,307 0.02

12 Tank Storage 461 11,386 0.04

13 Engineering 775 18,924 0.04

14 Purchasing 11,747 18,924 0.62

TOTAL= 31,653 206,054

Which three process areas to attack first?

Six Sigma Metrics


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Process Steps, Defects, Units and DPU (2)

Line Process Def Units DPU1 Tank Line 10,166 17,671 0.58

2 Paint Line 3,992 20,292 0.20

3 Core 2,096 38,397 0.05

4 Insulation 120 18,924 0.01

7 Core/Coil 302 15,757 0.029 Tanking 720 14,874 0.05

10 Fit for Ship 895 13,598 0.07

11 Block&Braze 379 17,307 0.02

12 Tank Storage 461 11,386 0.04

13 Engineering 775 18,924 0.04

14 Purchasing 11,747 18,924 0.62

TOTAL= 31,653 206,054

TanksPaint

Materials

Defects per unit drives plant wide improvement

Six Sigma Metrics

St C l it & Si L l


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Process Def Units DPU Op Total Op DPU DPO DPMO 1 5 YieldTank Line 10,166 17,671 0.58 35 618,485 0.58 0.0164 16,437 3.63 56.3%

Paint Line 3,992 20,292 0.20 30 608,760 0.20 0.0066 6,558 3.98 82.1%

Core 2,096 38,397 0.05 25 959,925 0.05 0.0022 2,184 4.35 94.7%

Insulation 120 18,924 0.01 10 189,240 0.01 0.0006 634 4.72 99.4%

Core/Coil 302 15,757 0.02 8 126,056 0.02 0.0024 2,396 4.32 98.1%

Tanking 720 14,874 0.05 35 520,590 0.05 0.0014 1,383 4.49 95.3%

Fit for Ship 895 13,598 0.07 28 380,744 0.07 0.0024 2,351 4.33 93.6%

Block&Braze 379 17,307 0.02 16 276,912 0.02 0.0014 1,369 4.50 97.8%

Tank Storage 461 11,386 0.04 22 250,492 0.04 0.0018 1,840 4.40 96.0%

Engineering 775 18,924 0.04 28 529,872 0.04 0.0015 1,463 4.48 96.0%Purchasing 11,747 18,924 0.62 25 473,100 0.62 0.0248 24,830 3.46 53.8%

TOTAL= 31,653 206,054 262 53,986,148 1.69 0.0614 61,443 3.04

Benchmarking process

steps and product

Steps, Complexity & Sigma LevelYield = e-DPU

Sigma Level

Six Sigma Metrics

P St FTY d RTY


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Process Def Units DPU Op Total Op DPU DPO DPMO 1 5 YieldTank Line 10,166 17,671 0.58 35 618,485 0.58 0.0164 16,437 3.63 56.3%

Paint Line 3,992 20,292 0.20 30 608,760 0.20 0.0066 6,558 3.98 82.1%

Core 2,096 38,397 0.05 25 959,925 0.05 0.0022 2,184 4.35 94.7%

Insulation 120 18,924 0.01 10 189,240 0.01 0.0006 634 4.72 99.4%

Core/Coil 302 15,757 0.02 8 126,056 0.02 0.0024 2,396 4.32 98.1%

Tanking 720 14,874 0.05 35 520,590 0.05 0.0014 1,383 4.49 95.3%

Fit for Ship 895 13,598 0.07 28 380,744 0.07 0.0024 2,351 4.33 93.6%

Block&Braze 379 17,307 0.02 16 276,912 0.02 0.0014 1,369 4.50 97.8%

Tank Storage 461 11,386 0.04 22 250,492 0.04 0.0018 1,840 4.40 96.0%

Engineering 775 18,924 0.04 28 529,872 0.04 0.0015 1,463 4.48 96.0%Purchasing 11,747 18,924 0.62 25 473,100 0.62 0.0248 24,830 3.46 53.8%

TOTAL= 31,653 206,054 262 53,986,148 1.69 0.0614 61,443 3.04 18.4%

Rolled Throughout Yield (Product of the Individual Yields) = 18.4%

Although the First Time Yield at any specific process step is high, only

18.4% of the transformers make it through the factory without rework.

Process Steps, FTY and RTY

First time Yield of calculation of 99.8% assumes that 31,240 of the 31,653

defective units will be re-worked and put immediately back into the process

Six Sigma Metrics

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Line Process Def Units DPU Op DPMO 1 5 Y ield1 Tank Line 10,166 17,671 0.58 35 16,437 3.63 56.3%

2 Paint Line 3,992 20,292 0.20 30 6,558 3.98 82.1%

3 Core 2,096 38,397 0.05 25 2,184 4.35 94.7%

4 Insulation 120 18,924 0.01 10 634 4.72 99.4%7 Core/Coil 302 15,757 0.02 8 2,396 4.32 98.1%

9 Tanking 720 14,874 0.05 35 1,383 4.49 95.3%

10 Fit for Ship 895 13,598 0.07 28 2,351 4.33 93.6%

11 Block&Braz 379 17,307 0.02 16 1,369 4.50 97.8%

12 Tank Storag 461 11,386 0.04 22 1,840 4.40 96.0%

13 Engineering 775 18,924 0.04 28 1,463 4.48 96.0%

14 Purchasing 11,747 18,924 0.62 25 24,830 3.46 53.8%

TOTAL= 31,653 206,054 1.69 262 61,443 3.04 18.4%

Dynamics of the System

Ensure you Review the Costs and Customer Impact of each process

Drives plant wide

improvement focus Drives SBU widebenchmarkingDefect data drives projectteam improvement

Rolled Throughout Yield= 18.4

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50% Reduction in DefectsProcess Def Units DPU Op DPMO 1 5 Y ield

Tank Line 5,083 17,671 0.29 35 8,218 3.90 75.0%Paint Line 1,996 20,292 0.10 30 3,279 4.22 90.6%

Core 1,048 38,397 0.03 25 1,092 4.56 97.3%

Insulation 60 18,924 0.00 10 317 4.92 99.7%

Core/Coil 151 15,757 0.01 8 1,198 4.54 99.0%

Tanking 360 14,874 0.02 35 692 4.70 97.6%

Fit for Ship 447 13,598 0.03 28 1,174 4.54 96.8%Block&Braze 189 17,307 0.01 16 683 4.70 98.9%

Tank Storage 230 11,386 0.02 22 918 4.62 98.0%

Engineering 387 18,924 0.02 28 730 4.68 98.0%

Purchasing 5,873 18,924 0.31 25 12,414 3.74 73.3%

TOTAL= 15,824 206,054 0.85 262 30,714 3.37

Roll Throughput Yield 43.0%

Rolled Throughput Yield improved from 18.4% to 43.0%

(134% improvement). Sigma went from 3.04 to 3.37.

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Six Sigma vs. Traditional Metrics Simulation.xlsSimulat ion 1

Process Process Process Process Total

1 2 3 4

Potential Defects Per One Unit 3 12 49 1 65

Operating Time (hours) 8.0 8 8 8

Acutal Cycle Time (sec/piece) 6.1 6.2 6.9 3.3

Nominal Cycle Time (sec/piece) 6.0 6.0 6.0 3.0

Amount of Downtime (hours) 0.5 1.2 0.3 0.3

Good Parts Produced (pieces) 4350 3957 4531 9010 21848

Defects Produced (pieces) 150 123 89 230 592

Number of Parts Repaired 68 68 89 2 227

Short Long

Term Term

RTY for Sigma Sigma

Process Level Level

Availability 93.75% 85.00% 96.25% 96.25%

Efficiency 98.36% 96.77% 86.96% 90.91%

Quality Rate 96.67% 96.99% 98.07% 97.51% 89.66% 2.76 1.26

PPM 33333 30147 19264 24892 107636 2.74 1.24

OEE 89.14% 79.78% 82.08% 85.32% 49.80% 1.50 0.00

First Run throughput 98.18% 98.65% 100.00% 97.53% 94.46% 3.09 1.59

TOP (total opportunity for defects) 13500 48960 226380 9240 288840

DPO (defects per total opportunity ) 0.01111 0.00251 0.00039 0.02489 0.03891

Yield From DPO 98.89% 99.75% 99.96% 97.51% 96.11%

DPMO 11111 2512 393 24892 38908 3.26 1.76

DPU 0.03333 0.03015 0.01926 0.02489 0.10764

TY (Throughput Yield) 96.72% 97.03% 98.09% 97.54% 89.80% 2.77 1.27

The correct w ay to calculate sigma levels off

of DPMO - how ever es tablishing the number

of opportunities poses a challenge

The correct w ay to calculate throughput yield (w ith Poisson apprx.) how ever incorrect

w ay to calculate sigma level (based on TY) even many people do it this w ay

Sigma level

significantly

understated w hen

PPM is used instead

of DPMO

Six Sigma Metrics

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- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

Sweet Fruit

Design for Manufacturability, Design for Six Sigma

Bulk of Fruit

Process Characterization

and Optimization

Low Hanging Fruit

Seven Basic Tools

Ground FruitLogic and Intuition

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

We don' t know what we don't know

We can' t act on wh at we don ' t know

We won ' t know un t i l we search

We won't search for w hat we don' t quest ion

3 Wall, Beat Up Suppliers

4 Wall, Improve Processes

5 Wall, Improve Designs

Harvesting the Fruit of Six Sigma

mod 1 bbstrategy sept 02

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