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Sources of the Continuous Improvement or Lean Six Sigma Projects

In a Continuous improvement journey, improvement projects are nothing but the lifeline. In this series of articles, we covered on the Need for Project Selection and the Criteria for project. Now we’ll answer the big question – Where can I get my projects from? Essentially various sources of the project!

Customers Interactions: “Customers” are the biggest source for improvement projects. Classically, negative customer sentiments are good places to start. Your customers are unhappy, so it’s time to fix the issue. Mixed or ambiguous sentiments are also relevant places to start.

·Customer Complaints:If your organization has a list of customer complaints, then that is an apt place to commence. Complaints are not only sore for your customers, but for you too. Such complaints may cover a vast product or service attributes such as product or service quality, delivery time, responsiveness, people issues, pricing or areas of monetary impact including warranty claims,process & policy issues.

· Repeat Complaints: You can go one step further and target repeat complaints instead. Repetitive complaints from the same customer with the same tagging indicates high priority area for improvement.

·Enquiries & Requests: Few organizations target the need of customers to call or contact the organization and, reduce them. It might not be a complaint, instead just an enquiry or request. In other words, interactions with the organization that can be avoided. Looking at enquiries and requests serve as a proactive means to identify future problem areas.

·VoC Program output: If your organization conducts structured VoC surveys, then the outputs of such mechanism can be a good source of Continuous Improvement or Lean Six Sigma projects

·Customer Experience (CX) Dipstick: Customer Experience is usually hidden and not so obvious as customer feedback. Structured and unstructured mechanisms can be deployed to understand the customer experience. For example, many organizations now use mystery shopping to unearth issues in customer experience. Observation or Listening posts are also a good way to identify how customer experience can be improved.

First Time Right (FTR): If you closely have a look at your company’s process, you will find that there are many internal defects (work-in-progress) occurring, such as rework, repairs & in-process rejections. Such defects are silent killers because they drain organization’s efficiency and effectiveness silently. If your organization is measuring FTR, then its improvement can be an ideal project. More evolved organizations use RTY (Rolled Throughput Yield) as a metric which is also a good place to demonstrate Continuous Improvement.
However, most organizations have a simpler measure of success for quality – Defect Rate (% Defective). While there’s nothing wrong with this metric, is a bit holistic and hence factors leading to inefficiencies escape unnoticed with this metric. Nonetheless, it is good starting point for Continuous Improvement projects.

Reliability Data/Warranty data: Field failures are sometimes grave. It can cost you a lot and, the overall cost of ownership for customers might increase esp if the warranty is denied or the product is under breakdown. In broader terms, the principle of warranty is to institute accountability in the event of an untimely failure of an item or the inability of the item to perform its intended function. Experts consider reliability data analysis as a quality measure over time. This reliability analysis is done to analyze whether your product will survive for the time defined by the company in the normal conditions. Improving the reliability of a product can work both ways – organizations can lower its operational cost and provide longer warranty and customers would experience break down less often.

Process Performance Data: If your organization has a well-defined and structured reporting mechanism for process performance metrics, such as a dashboard or scorecard, then it would be a very good source to identify opportunities for continuous improvement projects. As leadership teams are consumers of such reports, such opportunities can easily gain sponsorship as well.

Competitive Benchmarking: Benchmarking is a continuous process of comparing your firm’s or company’s practice to those of the competitors or say most successful competitors. In certain cases, you might not be doing well. For example, having control over the delivery time to the customers. Then this can be taken as a project for improvement in our company. So, to generalize, competitive benchmarking results can also be a good source for Continuous Improvement projects.

Business Plans/Strategies: Gap between strategic plan and reality can be the cause of concern for leadership. Sometimes such problems may be because of supporting processes. They can hinder new business plans or strategies. Such process improvement opportunities are also a good source for projects, provided they are scoped well with well-defined objectives & goals.

Employee Feedback: While customers don’t see your process but only experience its outcomes, employees have an end to end visibility. They experience problems as customers and can associate inward aspects of such poor experience. Many organizations, pilot their products with employees, because employees are pseudo customers. If you can establish a structured process through which employees are encouraged to share their experience and enable them to take up such opportunities as Continuous Improvement or Lean Six Sigma projects, there’s nothing like it.

All the above can serve as a good source for Continuous Improvement or Lean Six Sigma projects.

Info graphic -Sources of the Continuous Improvement or Lean Six Sigma Projects

Criteria For Project Selection

We talked about the need for Lean Six Sigma project selection in detail in the earlier articles, in this one we’ll cover the criteria for selection and the in the following article, we’ll move on to talk about the tools used for selection and how to engage the stakeholders in the process.I have found that while leaders agree on the need for project selection, their views on the criteria is quite divergent. Most of them see this as a process to sway the process in favor of their priorities and interests.

There is nothing wrong in doing so, as long as the process is not biased.
Through this article, we draw consensus on the criteria and its relevance to the whole process.

The real good news is that the criteria for getting the project selection right are not too complicated.

What does project selection countdown look it? We’re going to start with the least of the top 5 criteria and find our way to the top most criteria.
Here you go:

7. Probability of Success:Not all the projects will be successful in any company. Hence, while selecting the project, most project leaders consider the contingencies which might come up and use that as a yardstick to select the project. Sponsors want their project leaders to be successful equally as projects leaders’ desire success. Well, sounds like a good approach. But doesn’t this approach make it very orthodox? Unlike other implementation projects in technology, improvement projects are bound to have ups and downs; and it is quite natural that not all projects achieve their goals. That is what continuous improvement is all about.

Thus choosing to play it safe isn’t the best criteria to select projects, though unfortunately, it is very popular criteria in use. That is why Probability of Success is the last in our countdown list! One of the organizations flips these criteria to select the project which has failed in the past or have a low probability of success as Black Belt project.  That is certainly a best practice to emulate.

6. Availability of Data:

Is data readily available for the project? If not, can it be easily gathered? While most project leaders and sponsors know that rarely will all the data needed for a project is waiting around to be analyzed. But they use the availability of data criteria to select projects because the unreasonable expenditure of time, resources and effort can be avoided. Yes, data is needed for analysis. But making it a criterion reduces the scope Continuous Improvement deployment.

Improvement projects are expected to venture into unchartered territories of the process and present root cause and opportunities. Getting people to measure something that is not being reported till now, in it is a feat. Having vanilla project can hardly be a criterion for project selection. That is why the availability of data comes second last in our countdown!

5. Savings potential:

Any project implemented, is implemented with an intention to gain any kind of tangible or say monetary benefits. But along with monetary benefits, there are other benefits like customer satisfaction, increased efficiency, total company involvement; increases workspace and much more. While it is absolutely apt to select projects which have savings to the organization, it is misleading to make saving potential a primal purpose of projects. I have seen many times, project leaders come up with simple ideas or improvements with a huge saving potential to the organization, but virtually no complexity involved. Such projects hardly qualify for Black Belt projects.

They best serve as Just Do It project. Giving undue importance to saving potential in project selection also sends the wrong message across the organization. That is why I not really excited about having this as a top item in the countdown. That’s why Saving Potential is only Number 5 in our countdown.

4. Apt Time:

There is always a perfect timing to initiate a project. Relevance is contextual. By apt timing, I mean both the time to commence, and the closure as per plan. An important project has to close on time. It has to be first of all, planned to close on time. It has to be scoped to close on time. That is why Apt Time is No.4 in our countdown.

3. Availability of Resources:

I don’t know if this has to do with the culture. Most organizations, if not all, end up with a laundry list of projects because everything seems to be Business or Customer priority. Even the biggest and richest of the organizations have limited resources. Either resource is depleted, busy elsewhere or simply not committed to deliver. The best person is often leading many projects, making everything he/she does venerable to failure. Project selection is about de-selection and not selected. Ruthlessly put ideas into a parking list for which right resources are not available; and if it is so important that it has to be executed now, then pull the right resource into this project rather than sharing.

While I have largely kept this point around manpower, it equally applies to money & time. I say with conviction that organizations that ensure that the leader of the Lean Six Sigma project is a dedicated resource, either full time or handling only one project even if it means he is part time on it are surely successful. This is why Availability of Resource is No.3 on our countdown!

2.Customer impact:

Ask yourself “will the results of the project bring any difference in the life of the customer? Will it improve the perception of the customers about the quality of your product or services?” Quite often this answer to this question is yes. Unfortunately, it’s motherhood in apple pie question. So insist on quantifying the impact.

If you can pin a number to the impact, then go ahead. And if you’re not able to do so, then there’s no point in wasting your time on the project. Consider Voice of the Customer in your organization as a starting point. Why don’t you start with complaints and alleviate customer pain? Thus Customer Impact is Number 2 in the countdown.

1.Business Priority:

Selection of projects is based on the need or priority of the business. Project leaders need to understand that the tail can’t wag the dog. Often, people package their ideas into a project and fuel it as an organizational priority. Scanning of the external and internal environment will give first-hand insight on what is the organizational priority, NOW? Go for it. Well, that may put you out of your comfort zone, competency or expertise, but remember that’s what the organization needs.

Without a real need, do you think any leader would offer sponsorship to your project or will it at all help anyone – NO.? That is why Business Priority is Number 1 in our countdown.

Project Selection and implementation of Lean Six Sigma is easy and at the same time should be handled delicately by keeping all the above aspects in mind otherwise it might turn into a big disaster. An effective diagnostic study is required before selecting projects and with the undivided involvement of the top management are pre-requisites for project selection.

Info graphic – Criteria for project selection

Criteria for project selection from Canopus Business Management Group

Info Graphic – Continuous Improvement

Continuous Improvement from Canopus Business Management Group

Why should you be worried about Project selection in any Continuous Improvement (CI) Program?

While leaders strive to build a culture of continuous improvement (CI) in their organizations, it is equally important to understand that business-as-usual activities take precedence over improvement activities. CI programs commence with a big bang and a lot of enthusiasm, but time wears out even the strongest and what it leaves behind is mere CI hubbub. This is not a simple problem to solve. If you have been part of any enterprise-wide CI deployment, you will have no difficulty relating to this. This problem is complex and has several failure modes.

In this article, I’ll like to highlight a common but significant failure mode – Selection of projects. It’s needless to emphasize that projects play a big role in any CI journey, but to its disgrace, projects are also a significant contributor to the downfall of CI program.

Going overboard and having too many concurrent projects is one way to fail. Not selecting the right projects to pursue is another. Here are few compelling reasons to consider project selection as an important activity rather than opening the floodgates of projects:

Business Priority: Every business has its own priorities and so it’s important to select the right projects that are aligned with your priorities. Having many dispersed projects will blemish, if not nullify the impact of projects. Alignment between leader’s priority & CI program can be easily accomplished if you select projects right at the beginning.

Change due to competition: If your competition is disrupting the industry, well you better select where you need to improve. External environment often forces organizations ruthlessly reform their way of thinking and working. And today, we all live in a world that is fast changing. So unless your right projects are selected and pursued, your CI program will become redundant soon.

High Customer Expectations: Everyone I talk to says, customers are demanding more than ever before. Understanding the changing their needs and aligning the CI program to customers is vital to the success of any organization’s CI program. Organizations sometimes pursue trivial opportunities such as cost saves but miss on acting on big ticket customer facing projects or customer pain points. Of course, while dealing with customers, things are going to be volatile, but that’s not a reason to avoid them. The good project selection process should filter such project opportunities.

Limited Budgets: All organizations must work within the framework of budgets. Improvements need monetary resources to support the change. Sometimes they are direct and hence easily associated to direct cost centers. But projects with intangible benefits or the ones incurring indirect costs usually end up as scapegoats. If an organization commits to project selection, many such failures can be prevented.

Availability of Resources: Human capital is scarce. CI projects need quality time and mindshare from people of importance in the organization. Quite often resource requirements are never considered during the commencement of projects. Even if considered, it’s only the project leader’s time. As CI projects are a cross-functional effort, active participation of experts from all involved functions defines the success of the project. In order to ensure we get the best out of our teams, we need to time our success. Thus project selection is a time sensitive activity.

Optimizing Number of Projects: Not all the areas of your organization need improvement at the same time, And improvement culture building is a slow and steady process which can never be implemented overnight, nor will the results reap overnight. So getting to rush out the organizational adrenaline may not be a success recipe for good CI program. Selection of projects will ensure that you sustain optimum enthusiasm in the system for CI.
So it is very evident that selection of projects impacts the CI culture, employee satisfaction, alignment to customers and ROI to business for the investments it makes in CI in a positive way. In the future articles, we’ll take this one step further and talk about the criteria used for selecting projects.

Are Design Thinking and Six Sigma mutually exclusive?

Read Nilakanta Srinivasan's answer to Are Design Thinking and Six Sigma mutually exclusive? on Quora

Significance of Y=f(X) in Lean Six Sigma

If you are new to Lean Six Sigma then Y=f(X) is one amongst many jargons that you will have to familiarize yourself.

The objective of Lean Six Sigma philosophy and DMAIC improvement methodology is to identify the root causes to any problem and control/manage them so that the problem can be alleviated.

Six Sigma is process oriented approach which considers every task as a process. Even the simplest of the tasks, such as performing your morning workout or getting ready to office is considered as a process. The implication of such a view point is to identify what is the output of that process, its desired level of performance and what inputs are needed to produce the desired results.

Y is usually used to denote the Output and X for the inputs.

Y is also known as dependent variable as it is dependent on the Xs. Usually Y represents the symptoms or the effect of any problem.

On the other hand, X is known as independent variable as it is not dependent on Y or any other X. Usually Xs represents the problem itself or the cause.

As you will agree that any process will have at least one output but most likely to have several inputs. As managers, we all are expected to deliver results and achieve a new level of performance of the process such as Service Levels, Production Levels, Quality Levels, etc., or sustain the current level of performance.

In order to achieve this objective, we focus our efforts on the output performance measure.  However a smart process manager will focus on identifying Xs that impact the output performance measure in order to achieve the desired level of performance.

How does one identify the input performance measures or Xs?

Six Sigma DMAIC methodology aims to identify the inputs(Xs) that have significant impact on output (Y). After that the strength and nature of the relationship between Y and Xs are also established.

Six Sigma uses a variety of qualitative and quantitative tools & techniques listed below to identify the statistical validation of the inputs (or root causes), their strength and nature of relationship with Y:

  • Cause and Effect Diagram/Fish Bone diagram
  • 5 Why Analysis
  • Process Maps
  • Histogram
  • Descriptive Statistics
  • Run Charts
  • Normal Distribution Plots
  • Box plots
  • Stem and Leaf Plots
  • Hypothesis Testing
  • ANOVA (Analysis of Variance)
  • Chi-Square Test
  • 1-t Test
  • 2-t Test
  • Paired t Test
  • Correlation
  • Regression
  • Scatter Plots
  • Statistical Process Control (SPC)/Control Charts

What does f in Y= f(X) mean?

‘f’ represents the nature and strength of the relationship that exists between Y and X. On one hand, this equation can be used for a generic interpretation that symbolizes the fact that Y is impacted by X and nature of relationship can be quantified. On the other hand, such a mathematical expression can be created provided we have sufficient data using the above mentioned analytical tools such as regression and other hypothesis tests.

The mathematical expression that we obtain is nothing but an equation such as:

TAT = 13.3 – 7.4*Waiting Time + 1.8*No. of Counters – 24*Time to Approve

Once such an equation is established, it can be easily used to proactively identify the Y for various values of X. Thus Y= f(X) is the basis for predictive modeling. All the newer analytical concepts such as Big Data, etc are based on this foundation principles.

Webinar : Applications of Statistical Process Control(SPC) in Six Sigma Projects

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Lean Six Sigma Project – A Beginner’s Guide

Lean Six Sigma Project – A beginner’s guide is a series that explains how to run Lean Six Sigma projects in detail. The biggest benefit of combining Lean and Six Sigma is to deliver more value to customers and business. In order for a Six Sigma Green Belt to be successful with a project, they must know what’s to be done, and how to accomplish them! This guide is a step-by-step procedure to execute the 5 phases of a Lean Six Sigma project.

Lean Six Sigma improvement projects follow 5 phase DMAIC approach. A six sigma project is not an academic exercise, but its primary objective is to impact customers, business, and employees positively. Thus stakeholder buy-in and sponsorship are very important factors for its success. Every project should have at least one project sponsor (One sponsor is just fine, two is OK, but greater than that is undesirable). The project sponsor is usually the process owner or a senior management executive who is accountable for the overall project and its success. They take the lead in identifying the project & its objectives, and in team formation.

The team composition should be cross-functional. The sponsor also has to decide whether this Six Sigma project should be led by a Black Belt or Green Belt. Once identified, the respective Six Sigma Belt plays the lead role in the project. It is their responsibility to complete the project on time, and deliver desired results. Now, for the remaining part of this beginner’s guide, let’s assume that it is a Lean Six Sigma Green Belt Project.
The duration of a typical project should be between 3 to 4 months. The overall project plan for all Six Sigma improvement projects are mapped to Define, Measure, Analyze, Improve, and Control. There are defined deliverables for each of these phases which have to be accomplished before progressing further. At the end of each phase, a formal tollgate is used to stage a gate review by the sponsors. Various Six Sigma concepts and tools can be applied to progress and accomplish desired phase-wise outcomes.

In order to make sure the project meets the timeline, and set-out objectives; the Green belt and team members are to meet regularly. In addition to this, Six Sigma Green Belts are mentored by Black Belts or Master Black Belts.

In a nutshell, following are the broad outlines for each of the DMAIC phases of Lean Six Sigma Project:

  • Define – Identify the project objective and define the problem to be solved
  • Measure – Collect necessary data regarding the problem and establish current performance
  • Analyze – Use the data collected to analyze and screen factors which are the root causes for a problem
  • Improve – Identify suitable solutions to overcome the root causes
  • Control – Implement the solutions and monitor its results

Next, as a part of this beginner’s guide, let’s understand how to accomplish the deliverable of the Define phase here. Next >>>

What is Design for Six Sigma (DFSS)

Design for Six Sigma (DFSS) is an approach that is part of the Six Sigma methodology, and it aims to develop products and services which operate at Six Sigma or above. What does this mean; and how is this approach different from implementing six sigma in existing products, services & processes? If you have read our articles What is Six in Six Sigma, and What is Sigma in Six Sigma; you will understand how Six Sigma is measured.
Every process performs at its designed and operating capability. For instance, consider the Indian traffic and transportation management system. A good measure of its performance is the number of deaths due to road accidents. There are several other measures, but for simplicity let’s just consider this one. This performance measure is called CTQ (Critical To Quality).
India has the largest number of deaths per year due to road accidents (Approximately 130,000 deaths per annum). If we were to commence a Six Sigma project to reduce the number of deaths, we would use DMAIC approach. We will identify root causes for this problem, and try to eliminate them with good and sustainable solutions. For instance, helmets and seat belts mandatory, enforcement of speed limits & drunken driving laws, additional traffic patrols, etc., may be few solutions we will implement.

By doing so, lets hypothetically assume that we have been able to reduce the number of deaths to 30,000 per annum, in 3 years’ time. However, we aren’t able to reduce it any further. This stage; when any process or system is delivering its best performance, is referred to as Process Entitlement.
However, 30,000 is still a high number and we want to bring it down to manageable double digits. So we have to discard our existing traffic & transport management system; and design a completely new system, from scratch, that will help us reach our target. Double digit fatality means we will operate well within Six Sigma level, considering our 1.2 billion population as a base.
Such a process of re-designing or newly designing any product, service or products is referred to as DFSS. Design for Six Sigma is defined as a Customer focused design approach used for creating products, services, and processes which will deliver Six Sigma Performance. Samsung products are a very good example of Design for Six Sigma.
In many fields like airline, surgery, automobile braking, etc., require processes to deliver Six Sigma at all times. For such systems, design for six sigma concept comes handy. The very first time products and processes are developed, they are designed to deliver Six Sigma performance.
Following are the key differentiators for DFSS:

  • Understand customer requirements, and translate them to product performance measures.
  • Design products, sub-systems, and processes to deliver Six Sigma performance.
  • Design ‘first time right’ products and services.
  • Innovative designs deliver Six Sigma performance, rather than existing designs.
  • Optimize the design for usability, manufacturability, or serviceability.

While DFSS is a principle, there are different ways in which it can be put to use. IDOV and DMADV are popular approaches.

IDOV is a 4 step approach representing Identify, Design, Optimize & Verify.  And DMADV is a 5 step approach representing Define, Measure, Analyze, Design & Verify.

Six Sigma Process

Six Sigma has been a successful management approach, and a philosophy for many leading global enterprises. Let’s understand Six Sigma Process – in other words – Six Sigma Deployment Approach.

While the deployment of Six Sigma depends on several factors; the following approach explains Six Sigma process in its simplest form.

Six Sigma as a management discipline puts customer’s interest ahead of others. The process of gathering customer requirements is called as Voice of Customer (VOC). A good deployment program starts with VOC. Customer requirements directly translate into business performance standards. In Six Sigma and many quality management approaches, these performance standards are called as Customer Specification Limits.

Operational metrics and performance measures like KPIs are created based on customer requirements. Such operational measures or KPIs are called as Critical To Quality (CTQ) metrics in Six Sigma.

Output of existing processes is measured against customer requirements. This becomes a benchmark of performance. In Six Sigma, this step is called as Assessment of Current Process Capability.

In case an end-to-end process is not capable of consistently meeting customer requirements, and produces high volume of defects; it is taken up for improvement.

Process improvement approach used in Six Sigma is called as DMAIC. It is the acronym of Define, Measure, Analyze, Improve and Control: a 5 step improvement approach.

In this manner, Six Sigma aims to link Customers, Business Processes, CTQs and process improvement all together.

The real power of a Six Sigma Process is in consistently and iteratively following the above activities.

Thus, an organization following a Six Sigma Process:

  1. Systematically and regularly gathers VOC
  2. Measures its process capability
  3. Identifies improvement opportunities
  4. Uses DMAIC to improve its processes