1. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Lecture 9 Six Sigma Organization and Infrastructure

2. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Focus of this lecture How to organize for Six Sigma? How to change the culture to accept Six Sigma? Learn from the successes achieved by GE in Six Sigma implementation. What are the critical roles and responsibilities in a Six Sigma organization? Development and selection of Black Belts

3. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Interrelationships in a Six Sigma organization (Everybody talks to each other)

4. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Six Sigma organization with Strategic Business Unit (SBU) Companies use one of the following organization charts: 1) Six Sigma under organizational leader a) SBU manager champions the project. b) Process owners & managers are selected within his organization. c) Black Belts have multiple projects with different sponsors. 2) Six Sigma under Quality leader (GE) a) Master Black Belts report to Quality leader. b) Master Black Belts train Black Belts and Green Belts. c) Project leaders have dedicated team members.

5. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Six Sigma under Organizational leader

6. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Six Sigma under Quality leader

7. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Critical elements of Six Sigma organization and infrastructure Understand and define the key operational roles of the people from the start. All the people involved in Six Sigma should know how their roles work together. Involve executive managers in leading the Six Sigma initiatives and in promoting it throughout the organization. Champions must own their processes and should make every effort to make it easier for the Black Belts to achieve results. Use the expertise and experience of Master Black Belts wherever possible due to their extraordinary knowledge. Select the Black Belt and Green Belt candidates carefully and provide the necessary training, both technical & nontechnical.

8. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Customer focus The key to the successful Six Sigma infrastructure is how well it is able to focus on the customer needs and requirements. The factors that are important to the customer should be the necessary inputs to the process improvement projects. Customer complaints should be viewed as an opportunity for growth and market share. These complaints should be the areas for process improvement.

9. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Steps to get customer input Walking the customer process Performing customer survey Conducting personal interviews with key customers Establishing feedback/complaint system Developing customer panel (committee)

10. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Steps to conduct effective customer surveys 1) Conduct a focus group and individual interviews 2) Review interview issues, and select key issues 3) Customize, administer, and digitize the survey 4) Analyze the feedback reports to identify the key issues 5) Communicate feedback to appropriate people 6) Create an action plan based on the customer feedback 7) Monitor progress of the action plan 8) Evaluate and make modification to the survey

11. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Format for developing an effective survey Survey items should consist of simple language. Items should be mildly positive or mildly negative. Items should measure one issue at a time. For each item, determine what corrective actions would be required if the feedback is negative. Test your survey to check for the quality of the feedback Include few open ended questions, which will provide valuable feedback. Use a five-point scale for feedback

12. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Critical resources for Six Sigma organization Champion (Executive-level Manager) Master Black Belt (Statistical expert) Black Belt (project Manager/Facilitator) Green Belts Team Member Sponsor/Process owner (Manager of the Process)

13. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Responsibilities of the Champion Communicate Six Sigma vision Determine project selection criteria Approve or reject any recommendations Implement change & provide necessary resources Approve completed projects

14. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Responsibilities of the Master Black Belts Provide extensive Six Sigma training Couch multiple Black Belts and Green Belts Share Six Sigma methodology expertise Help with project execution efficiency Formulate business strategies with management Help with effective presentation

15. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Responsibilities of the Black Belts Select, teach, and use most effective tools Develop and manage detailed project plan Schedule and lead team meetings Oversee data collection and analysis Establish reliable measurement system Provide team motivation and stability Calculate project savings

16. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Responsibilities of the Green Belts They assist Black Belts in their functional area and work part-time on projects in specific field. They apply Six Sigma tools to examine and solve chronic problems on projects within their dept. Their knowledge of the process in their area is very critical to the success of the project. They help Black Belts accomplish more in less time by collecting data, running experiments, or conducting other important tasks in the project.

17. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Responsibilities of the Process Owner Ensure that the process improvements are implemented properly Communicate process knowledge Obtain necessary approval for any process change Select team members Ensure that the improvements can be sustained over time

18. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Responsibilities of the Team Member Communicate change to other coworkers who are not part of the team Provide knowledge and expertise of the current process Collect data for the project Accept and complete all assigned action items Implement recommended project improvements

19. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Project tracking method used by GE All Black Belts are required to provide following detailed information about their projects in the database: Key process output variables (KPOV) Key process input variables (KPIV) Estimated completion date by phase Actual completion date by phase Six Sigma tools utilized for the project Open action items Defect definition Baseline measurement Financil calculations and actual project savings Lesson learned from project execution

20. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Force field analysis A Force field analysis is an effective way of illustrating the forces in an organization that drive toward a Six Sigma solution and those working against it.

21. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Example of action items that can change from current culture to Six Sigma culture

22. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Selecting a Black Belt Not every employee is a Black Belt candidate. Its a full time position that combines leadership ability, technical skills, some statistical knowledge, and ability to communicate and motivate others. Black Belts are technical leaders and change agents. They are the key players who implement the Six Sigma principles, techniques, and tools.

23. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Rating a Black Belt candidate (A candidate who scores at least 38 has excellent potential) 1) Process and product knowledge_____ 2) Basic statistical knowledge_____ 3) Knowledge about the organization_____ 4) Communication skills_____ 5) Self starter, motivated_____ 6) Open minded_____ 7) Eager to learn about new ideas_____ 8) Desire to drive change_____ 9) Team player_____ 10) Respected in the organization_____ 11) Results oriented track record_____ Rate on a scale of 1 to 5. (5 = excellent, 4 = above average, 3 = average, 2 = below average, 1 = unacceptable). Total score _____________

24. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Before taking a Six Sigma role ask the following questions How long will the Six Sigma project last? What happens after I complete the assignment? Who will be my boss during this assignment? How will my work be measured for compensation? If it is a part-time Green belt assignment, how much time will be freed up to work on Six Sigma project? What kind of training or certification process will I need to pass? What are my growth potential after this experience?

25. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Eight critical steps to change from traditional culture to Six Sigma culture 1) Establishing a sense of urgency for change 2) Forming a powerful guiding coalition of key people 3) Creating a vision of Six Sigma culture 4) Communicating the vision to the organization 5) Empowering others to act on the vision 6) Planning and creating short term wins 7) Consolidating improvements & changing the metrics 8) Institutionalizing the new approach

26. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Project breakdown structure

27. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Ten critical elements for a successful team 1) Clear understanding of scope of the project goals 2) Clearly defined project execution plan 3) Clearly defined roles of team members 4) Good communication and listening skills 5) Encouragement to use individual skills & methodoligies 6) Well-defined decision procedure 7) Should be open to the contribution of others and be committed to the success of the project 8) Establish ground rules on how meetings will be run 9) Be aware of how the team works together 10) Focus on scientific approach and facts, not opinions

28. Copyright 2006 © by Dr. Govind Bharwani, Wright State University Certification for Black Belts Most of the organizations have their own certification for Black Belts. This involves completion of training and a minimum number of projects. The candidate should also demonstrate proficiency with certain statistical tools. Some organizations have also started the Six Sigma certification process, but be careful of the promotion. Talk to reputable associations.

29. Green Belts & Black Belts GE has very successfully instituted this program –4,000 trained Black Belts by YE 1997 –10,000 trained Black Belts by YE 2000 –“You haven’t much future at GE unless they are selected to become Black Belts” - Jack Welch Kodak has instituted this program –CEO and COO driven process –Training includes both written and oral exams –Minimum requirements: a college education, basic statistics, presentation skills, computer skills Other companies include: –Allied Signal-Texas Instruments –IBM- ABB –Navistar- Citibank

30. Task Time on Consulting/ Training Mentoring Related Projects Green Belt Utilize Statistical/ Quality technique 2%~5% Find one new green belt 2 / year Black Belt Lead use of technique and communic ate new ones 5%~10% Two green belts 4 / year Master Black Belt Consulting/ Mentoring/ Training 80~100% Five Black Belts 10 / year Green Belts & Black Belts