Quality Tools

The PDSA Cycle Plan Do Study Act

The Process Improvement Cycle Implement the Improved process Select a process Study/document Seek ways to Improve it Design an Evaluate Document

Process Improvement Tools There are a number of tools that can be used for problem solving and process improvement Tools aid in data collection and interpretation, and provide the basis for decision making

Seven Basic Quality Tools Check sheets Flowcharts Scatter diagrams Histograms Pareto analysis Control charts Cause-and-effect diagrams

Check Sheet Monday Billing Errors A/R Errors Wrong Account Wrong Amount A/R Errors

Flowchart Process Good? Process Process Good? Process

Scatter Diagram Variable B Variable A

Histogram frequency A B C D E

Pareto Analysis 80% of the problems may be attributed to 20% of the Smeared print Number of defects Off center Missing label Loose Other 80% of the problems may be attributed to 20% of the causes.

Control Chart 970 980 990 1000 1010 1020 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 UCL LCL

Cause-and-Effect Diagram Materials Methods Equipment People Environment Cause

Tracking Improvements UCL LCL Process not centered and not stable Process centered and stable Additional improvements made to the process

Seven Management Tools Affinity Diagram Interrelationship Diagraph Tree Diagrams Prioritization Matrices Matrix Diagram Process Decision Program Chart Activity Network Diagram

Methods for Generating Ideas Brainstorming Quality circles Interviewing Benchmarking 5W2H

A Brief History of Quality

America Re-discovers Deming

… and Juran

Rediscovering the Gurus Deming Emphasis on Statistical Control 14 Points for Management Juran Quality Planning and Analysis Managerial Breakthrough Quality Control Handbook

Statistics

Statistics

What Types of Companies Can Benefit from Six Sigma? Companies that benefit from structured organizational improvement Companies that need to improve customer satisfaction All types of companies can benefit: Manufacturing Service Non-profit Educational

What is Six Sigma? Customer Focus – Focus on what is critical to customers Data Driven – Extensive use of statistical tools Robust Methodology – Tools plus implementation methods to make success more likely

What is Six Sigma? Key Concepts Critical to Quality: What attributes are most important to the customer? (CTQ, CTC, CTD) Defect: Failing to deliver what the customer wants / expects (DPMO) Variation: The level of unpredictability the customer experiences These key concepts focus on the CUSTOMER! First, we find what is most important. Second, we define what it means to fail to please the customer. Third, we deal with the important dimension of how much do we miss the expectation. GE says that customers do not feel the average, but rather the variation.

What is Six Sigma? Key Concepts Process Capability: What your process can deliver – consistently Stable Operations: Stable ops are predictable Design for Six Sigma: Designing to meet customer needs and process capability

DMADV - DMAIC New Processes Existing Processes

Statistics Lite Centered 3s Process LSL USL

Statistics Lite Centered 3s Process LSL USL s

Statistics Lite Centered 3s Process Non-conforming Product 1,300 DPMO LSL USL s

Statistics Lite Centered 3s Process Non-conforming Product 2,600 DPMO LSL USL s

Statistics Lite Shifted 3s Process LSL USL s 1.5 s mean shift

Statistics Lite Shifted 3s Process Non-conforming Product 66,800 DPMO LSL USL s 1.5 s mean shift

Statistics Lite Shifted 3s Process Cost to your company – 15-30% of sales Non-conforming Product 66,800 DPMO LSL USL s 1.5 s mean shift

Cost of Poor Quality Lost Opportunity 5-8% of Sales 15-22% of Sales Inspection Overtime Downtime Rejects Rework 15-22% of Sales Lost sales Long cycle times Cost of Capital Late delivery (less obvious) Redundant Operations Lost Opportunity Once you begin tracking true defects, your cost of poor quality will correlate to the DPU metric. It’s highly likely that currently no data collection system, manual or automated, exists to track your project “defects”. Some product defects are more costly than others. The top line in the chart above represents an increasing rate for the cost of each additional defect. You and your team should spend the time to carefully and accurately define defects for your project. ___________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________ Inaccurate Reports Expediting costs Excessive Planning Lost Customer Loyalty

Statistics Lite Centered 6s Process LSL USL s

Statistics Lite Shifted 6s Process LSL USL s 1.5 s mean shift

Statistics Lite Shifted 6s Process Non-conforming Product 3.4 DPMO LSL USL s 1.5 s mean shift

Why Six Sigma? 99% (3.8 Sigma) 99.99966% (6 Sigma) 20,000 lost articles of mail per hour 5,000 incorrect surgical operations per week Two short or long landings at most major airports each day 200,000 wrong drug prescriptions each year No electricity for almost seven hours each month Seven articles lost per hour 2 incorrect operations per week One short or long landing every five years 70 wrong prescriptions per year One hour without electricity every 34 years

Six Sigma Breakthrough Strategy Define Measure Analyze Improve Control

DMADV - DMAIC New Processes Existing Processes

Define - Selecting Projects The project must relate to customer satisfaction The project’s results must reduce defects by some threshold amount The project should achieve some threshold of cost savings.

Criteria for Project Selection Does it involve recurring events? Is the scope narrow? Do measures exist? Do you have control of the process?

Define Phase, Continued If these criteria are met then: 1) Identify the customers involved, both internal and external to the function. 2) Find out what the customer’s CT’s are (Critical to Quality, Critical to Delivery, Critical to Cost, etc). 3) Define the project scope and goals. 4) Map the process to be improved.

Define Phase - Tools Project Charter Stakeholder Analysis Affinity Diagram SIPOC Voice of the Customer CT Tree Kano Model SWOT Analysis Cause-and-Effect Diagrams Supplier Segmentation Project Management

Charter Problem statement Business case Goals, milestones, success criteria, & deliverables Project scope / boundaries Roles & responsibilities Stakeholder support / approval needed What is the problem? Know the difference between a problem and a cause. The Rational Manager Where is the value? Is there a burning platform? How much value and how much effort will be required to realize it? Gantt charts, Strategies, Tactics, Objectives, Dates Is the project sufficiently bounded? The strategy should trickle down to personal objectives. Responsibility matrix Whose approval do we need in order to be successful?

Define Phase Charter Development Charter – An agreement between management and project team members about what the team will accomplish.

Charter: Providing Direction You have to be careful if you don’t know where you’re going, ... because you might not get there.

Define Phase Charter – What it does Clarifies expectations (what and why) Keeps team focused Reduces tampering Reduces wandering Reduces goal creep Transfers ownership from management to team

Define Phase Charter – What it does Provides overview of purpose Describes why you are working on this project (business case) Defines scope of project Determines deliverables Defines measures of success Determines resources available

Potential Improvement Business Case Potential Improvement Potential Impact Improve quality Reduce cost, inventory Improve OTD Shortages , inventory  Select better suppliers Q, $, LT, reduce inventory Implement rating system Improve supply efficiency, better suppliers Reduce price Reduce cost

Define Phase - Tools Project Charter Stakeholder Analysis Affinity Diagram SIPOC Voice of the Customer CT Tree Kano Model SWOT Analysis Cause-and-Effect Diagrams Supplier Segmentation Project Management

SIPOC Example Ops Mgt Buyers Engrg. Mfg. Suppliers Inputs Processes Outputs Customers Ops Mgt Supplier Perf. Supplier Evaluation Survey Buyers Complaints Rating system Engrg. Tech Reqts Improved Supplier Perform. Engineering Mfg. Commit. to suppliers Supplier Complaints

SWOT Analysis Positive Negative Internal Strengths Weaknesses External Opportunities Threats

Define Outputs Once completed, the Define Phase should answer the following questions: 1) Who is the customer? 2) What matters? 3) What is the scope? 4) What defect am I trying to reduce? 5) What are the improvement targets?

Define Phase Toll Gate Review Submit project storyboard to sponsor Toll Gate review presentation Sponsor provides feedback Project corrections are made prior to proceeding to the next phase

The Measure Phase Purpose To collect current performance of the process identified in the Define phase This data is used to determine sources of variation and serve as a benchmark to validate improvements

Measurements Benefits of having good data need to outweigh the costs of getting it What does this measure do for the Project?

The Measure Phase Upon completion of the measure phase, Project Teams will have: A plan for collecting data that specifies the type of data needed and techniques for collecting the data A validated measurement system that ensures the accuracy and consistency of the data collected A sufficient data set for problem analysis

Measure - Key Concepts Measurement Variation Data Data Collection Plan Exists naturally in any process and is the reason Six Sigma projects are undertaken Data Data Collection Plan Measurement System Analysis Ensures measurement techniques are reproducible and repeatable

Recording Measurements 3 stages The output stage These tell how well customer needs are being met Parts of the process These are taken at critical points in the process The input stage These evaluate contributions to the process that are turned into value for the customer

Recording Measurements Output Stage Shortages Line shutdowns Quality – discrepant material Material price variances Internal customer survey

Recording Measurements Parts of the process Project milestones Supplier ship on time performance Supplier OTD Supplier internal throughput yield Supplier suggested cost reductions

Recording Measurements The input stage Supplier base size % Buyers with degrees % of spend covered by LTC’s % of spend from reverse auction Supplier FMEA’s

Operational Definitions Walter Shewhart, the inventor of statistical process control, believed his work on operational definitions to be of greater importance than his work on control charts.

Operational Definitions “An operational definition is a procedure agreed upon for translation of a concept into measurement of some kind.” Operational definitions should be valid and reliable. Deming, 1986

Operational Definitions? Slump, I ain’t in no slump. I just ain’t hitting.

Operational Definitions On-Time Delivery On-Time Payment Late Defective Clean Good communication Engineering support Do you, your management, and your suppliers agree on these definitions?

Determining Data Type What do we want to know? Review materials developed during design phase What characteristics do we need to learn more about?

Data Collection Plan What data will be collected? Why is it needed? Who is responsible? How will it be collected? When will it be collected? Where will it be collected?

Measurement System Analysis After Data Collection Plan is complete, it needs to be verified before actual data is collected MSA is performed on a regular basis MSA ends when a high level of confidence is reached that the data collected accurately depicts the variation in the process

Analyze Phase The analyze phase allows the Project Team to target improvement opportunities by taking a closer look at the data.

Analyze Phase Capability Analysis - establishing current performance level Graphical Analysis - a visual indication of performance using graphs Root Cause Analysis – developing a hypothesis about the causes of variation Root Cause Verification – verifying that the planned action will generate the desired improvement

Process Capability When selecting a process to perform an operation, the inherent variability of process output should be compared to the range or tolerances allowed by the designer’s specifications.

Much of the process output fits within specification width Process Capability process distribution Lower Specification Upper Specification Much of the process output fits within specification width In other words, is the process capable of producing the item within specifications? Almost all of the process output fits within the specification width A significant portion of the process output falls outside of the specification width

Analyze Phase Cause Hypotheses Identifying Obvious Process Problems Disconnects Bottlenecks Redundancies Unnecessary distance Rework Decision points Process Map Review

Analyze Phase Cause Hypotheses Quantifying Value-Added Steps Value-Adding Value-Enabling Non-Value-Adding Process Map Review

Analyze Phase Cause Hypotheses Process Time Analysis Work time (value, but often only 5%) Wait (& queue) time (usually dominates) Setup time (tremendous leverage) Move time (process dependent)

Analyze Phase Tools Brainstorming . . . And beyond! Process Maps Cause-and-Effect Diagrams Focused Problem Statement Statistical Tools

Cause-and-Effect Diagrams Supplier Failure - Causes

Elements of Improve Phase Generate Improvement Alternatives Create a “Should Be” Process Map Conduct FMEA Perform Cost/Benefit Analysis Pilot Validate Improvement

Improve Phase Elements Generate Improvement Alternatives Create a “Should Be” Process Map Conduct FMEA Perform Cost/Benefit Analysis Pilot Validate Improvement

Failure Modes Effects Analysis Identify failure modes – How can this product or process fail? Identify failure effects – What happens when this failure occurs? Identify potential causes of the effects & their probability of occurring. Rate the likelihood of detecting the occurrence.

FMEA - Output Ranked list of products that contribute to risk List of actions and persons responsible for addressing the risk Revised ranked priority list

Improvement Phase Methods UCL LCL Process not centered and not in control Process centered and in control Evidence of additional improvements

Review of Improvement Phase Generate Improvement Alternatives Create a “Should Be” Process Map Conduct FMEA Perform Cost/Benefit Analysis Pilot Validate Improvement

Generating Improvement Alternatives Define Improvement Criteria Generate Possible Improvements Evaluate Improvements and Make Best Choice

Pilot Benefits of Pilot Determine best way to implement the improvement Lowers risk of failure Increases opportunity for feedback Obtain buy-in from affected personnel Provides opportunity to revise the improvement before full implementation

Stakeholder Analysis People or Groups Level of Commitment Buy Mfg Eng Enthusiastic Support Help it work Compliant Hesitant X Indifferent Uncooperative Opposed Hostile

Review of Implementation Phase Generate Improvement Alternatives Create a “Should Be” Process Map Conduct FMEA Perform Cost/Benefit Analysis Pilot Validate Improvement

Control Phase Why is it important? The Control Phase begins as the project team tries to eliminate errors by “Mistake Proofing” their improvement alternative. Mistake Proofing attempts to eliminate the opportunities for error.

Control Phase Why is it important? Mistake Proofing tries to make it impossible for an operation to be performed incorrectly, and/or correct errors before they are passed to the next worker, where they might become a defect.

Control Phase #2 During the Control Phase the Project team will: 1) Develop a plan to make sure the measurement system will remain relevant over the long term. 2) Establish Control Charts the process owner will use to manage the process. 3) Create a Reaction Plan to address situations that might cause the process to move out of control.

Control Phase #3 The Control Phase ends when: 1) Standard Operating Procedures have been updated. 2) Process Operators, the people who do the job, have been trained for the new process. Once completed, the Control Phase should sustain the gains the project made while implementing ongoing process controls.

Control Phase #4 When is a project complete? 1) When other Black Belts can see the ongoing controls work 2) When the customer sees the results 3) When the business sees the money.

Six Sigma Six Sigma People Executives Champions (deployment, project) Master Black Belts Black Belts Green Belts

Control Phase Methods During the Control Phase the Project team will: 1) Develop a plan to make sure the measurement system will remain relevant over the long term. 2) Establish Control Charts the process owner will use to manage the process. 3) Create a Control Plan to address situations that might cause the process to move out of control.

Statistical Process Control (SPC) Chance variations are the many sources of variation within a process that is in statistical control. They behave like a constant system of random chance causes. If only natural causes of variation are present, the output of a process forms a distribution that is stable over time and is predictable.

Statistical Process Control (SPC) Assignable variation in a process can be traced to a specific reason. Machine wear Misadjusted equipment Fatigued or untrained workers If assignable causes of variation are present, the process output is not stable over time and is not predictable.

SPC - Assignable Causes The operational definition of assignable variation is variation that causes out-of-control points on a control chart.

Natural Patterns or Variations Natural patterns exhibit the following characteristics: Most of the points are near the centerline. A few points spread out and approach the control limits. None (or only on rare occasions) of the points exceeds the control limits. Reference: Statistical Quality Control Handbook, Western Electric

Unnatural Patterns or Variations Unnatural patterns exhibit the following characteristics: Absence of points near the centerline produces a pattern known as a “mixture.” Absence of points near the control limits produces an unnatural pattern known as “stratification.” Presence of points outside of the control limits produces an unnatural pattern known as “instability.” Reference: Statistical Quality Control Handbook, Western Electric

Tests for Unnatural Patterns Instability A single point falls outside of the 3 sigma control limits. Two out of three successive points fall in the outer one third of the control limits. Four out of five successive points fall in the outer two thirds of the control limits. Eight successive points fall on one side of the centerline. Systematic variable A long series of points are high, low, high, low without interruption. Reference: Statistical Quality Control Handbook, Western Electric

Statistical Process Control Why use averages? To create a normal distribution Averages are more sensitive to change than individuals

Central Limit Theorem Simulation The distribution of a sample approaches normal even when the parent population is not normally distributed.

Control Phase Mean and Range Charts Drift Detected No drift detected Process Distribution process mean drifting upward UCL LCL x-Chart UCL LCL R-chart

Control Phase Mean and Range Charts No shift detected Increase detected Process Distribution process variability increasing UCL LCL x-Chart UCL LCL R-chart

Statistical Process Control Tolerance or specification limits Defined by an engineer Related to product design requirements Control limits Defined by the process Related to the variation in the process Unrelated to product needs

Control Phase Control Plans Structured approach for designing value added control methods Control actions necessary to ensure output quality May include controls anywhere in the process

Control Phase Radar Chart Product Features -  Days Late Data Entry Errors ___________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________ Savings by Project

Control Phase Radar Chart Defect Levels by Supplier ___________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Final Toll Gate Review Submit project storyboard to sponsor Toll Gate review presentation Did the team carry out the agreed upon tasks? Did the team achieve the desired results? Sponsor provides feedback Project corrections are made prior to termination or proceeding to next cycle

Why TQM Fails Lack of Top Management Commitment Wasted Education & Training Lack of Short-Term Results Failure to Empower Employees Commitment Up Front Appropriate Training Biz Case Threshold Charter Brown, Hitchcock, and Willard - 1994

Why Six Sigma Fails (and it does) Lack of Top Management Commitment Interdepartmental / cross-functional issues Communication People

Kimball Bullington, Ph.D. Quality Tools Kimball Bullington, Ph.D.

References Books: Web sites: Six Sigma Pocket Guide (Rath & Strong’s) The Black Belt Memory Jogger (GOAL / QPC) Six Sigma (Harry and Schroeder) Implementing Six Sigma (Breyfogle) The Six Sigma Way Team Fieldbook (Pande, et al) The Vision of Six Sigma: A roadmap for breakthrough (Harry) Why TQM Fails and What To Do About It (Brown, Hitchcock, & Willard) Web sites: www.isixsigma.com www.ge.com/sixsigma www.asq.org www.aiag.org