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Unit 2: Project & Processes Unit Objectives : Projects & Processes

The objectives of this

unit that need to be
understood: • What is a Process ?

• What is Quality ?

• Selecting the Right Projects

• Six Sigma Team Management

• Introduction to DMAIC and DMADV

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What is a Process

➢ A process is a collection of tasks, steps, or activities that are performed, usually

in a specific order, and result in an end product such as a tangible good or the
provision of a service.

➢ In a business, multiple processes work together to achieve organizational goals.

Technically, the business or organization itself can be seen as one enormous
process.

Chapter 7
What is a Process?

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Four Layers of the Process Definition Major Process Components

As you continue with this chapter, you’ll see that processes can be very complex.
Our basic definition above is just that: Basic. Before we begin defining the Customer places an order for a
medium cheese pizza.
components of a process, let’s peel back the layers of this concept known as “a
process.” ➢ Inputs
Inputs: Tasks: Decisions:
➢ The Steps Cheese Putting the What size ➢ Outputs
Dough Sauce ingredients crust/how
Oven together many
temperature Placing pizza ingredietns?
➢ Processing Time Cook time in oven How long does ➢ Events
Taking pizza the pizza cook
out of oven for?

➢ Interdependencies ➢ Tasks
➢ Resources and Assignment Process: Make medium cheese pizza ➢ Decisions

All Components Are Related

Output:
a medium cheese pizza

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Process Owners Data

A process owner can be:

Data is extremely valuable
➢ A person in charge of a very specific process or function, A team supervisor or to Six Sigma teams
department manager, An executive-level individual who is probably responsible
because it’s often how they
for a number of processes in his or her division
define whether a process is
What does a process owner do? in control and successful.
➢ The responsibilities of a process owner are often defined by the infrastructure of a specific business, but
commonly, a process owner will: All processes generate
➢ Monitor how the process performs, usually using one or more metrics or regularly reported data some form of data. Even if
elements.
data isn’t yet being
➢ Understand how the process fits into the overall business, why the output of the process is critical to
business goals, and what inputs feed the process. captured, information is
➢ Ensures the process is documented via standard operating procedures (SOPs) and that process inherent in any process.
documentation is kept current and accurate.

➢ Ensures operators within the process have the resources and training they need to complete their jobs.

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Defining Process Components: The SIPOC Creating a SIPOC Diagram

➢ Step 1: Create Swim Lanes

➢ Step 2: Set Boundaries and

Name Your Process

➢ Step 3: Complete Swim

Lanes

❖ Name Outputs and

Customers

❖ Name Inputs and Suppliers

➢ Step 4: Validate the

Information

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Quality

One of the most concise definitions of quality comes from the International
Organization for Standardization, or ISO. ISO 9000 defines quality as the “degree
to which a set of inherent characteristics fulfils requirements.”

A Six Sigma team should be interested in requirements generated by all interest

points, but often focuses most on those generated by the customer. Various types of
requirements might include:

Chapter 8 ➢ Customer expectations

Quality ➢ Compliance or regulatory rules, which are obligatory

➢ Brand expectations

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Critical to Quality Characteristics (CTQ’s)

Critical to quality characteristics, or CTQs, are the factors or parameters that When creating a CTQ tree, you don’t have to follow an equal
are the major drivers of quality within an organization or process.
pattern for drivers and requirements. Some customer needs will
Usually, CTQs are key characteristics that can be measured; where the have more drivers than others; some drivers will have more
performance of said metric provides information about whether or not the
requirements. You might also have multiple CTQ trees – you’ll want
customer is going to be satisfied.
to create one for every need you identify that is critical to a
customer.
• Identify Critical-to-Customer

• Needs Identify Drivers of Quality

• List Requirements for Each Driver

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The CoQ and the CoPQ

Quality comes at a cost. When talking about quality costs, many organizations
consider what is known as the cost of poor quality, or CoPQ.

The cost of poor quality is defined as the costs or expenses associated with defects
created by a process. Quality actually has a broader cost – avoiding poor quality
comes at an expense as well.

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Cost of Quality (COQ) The Cost of Quality and Six Sigma

The optimal COQ is one that reflects the appropriate balance for investing in the cost of prevention and
appraisal to avoid failure costs. Models show that there is an optimal quality cost for projects, where
investing in additional prevention/appraisal costs is neither beneficial nor cost effective

CoQ = CoPQ + Prevention Costs + Appraisal Costs

<

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Identifying Prevention and Appraisal

Managing Cost of Quality
Activities
The first step to removing quality-related muda is identifying it. Process maps, spaghetti Six Sigma is one of the best methodologies for managing the cost of quality because it
diagrams, and value stream maps are valuable tools for uncovering activities that don’t works to build quality into every process. When approaching an organization or process
need to be included in a process that has a high cost of quality, teams and leadership can apply a triage-based method to
• Does the activity itself add any value to the output? reduce those costs. While no organization can remove quality costs 100 percent, the goal
should be zero costs of failure, either internal or external, and minimal preventative and
• Does the activity substantially reduce the time it takes for the process to produce an
output? appraisal costs.
• Does the activity substantially increase the cost of the process?
The benefit of building failure stop-points into a process include:
• If the activity is designed to prevent defects within the process, can the
activity be made more efficient?
• Earlier detection when errors do occur, which keeps hidden costs down
• If the activity is designed to prevent defects, can the activity be made less expensive? • Employees are able to support and manage higher quality
• If an activity is designed to capture quality data about the process for • In-process quality assurance is actually more effective than post-process or over-process
reporting purposes, are those reports necessary? prevention and appraisal methods.
• If quality reports are necessary– either because of obligatory requirements
such as compliance or because the reports provide value in another process Often, in a process that is functioning at a high sigma level, prevention and appraisal
– can the reports be automated to reduce associated expense? activities are a form of muda. They can be expunged from the process without impacting
the end product, quality, customer satisfaction, or employee morale.

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Quality is Critical to Success

When Six Sigma teams are expunging quality-related costs and unnecessary activities from
processes, it is critical that they don’t actually remove quality. While it’s true that
traditional quality programs and costs don’t have to be present to ensure a reduction in
defects and an improvement in customer satisfaction, it’s equally true that you have to
replace those programs with some other form of control.

It’s also worth noting that a single Six Sigma team – or even an entire department devoted
to Six Sigma – can’t reduce the costs of quality in an organization on their own. Corporate
leadership must buy into the belief that quality is better when controls are incorporated
within the process, and they have to be willing to communicate this fact via training and Chapter 9
example.
Selecting the Right Projects

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Juggling the Right Amount of Projects Enterprise-Level Selection Process

When companies are working to apply Six Sigma culture to the entire enterprise, executive
Since Six Sigma works best when it is implemented as a company-wide culture, project
leaders and other decision makers should work directly with Six Sigma experts to identify
selection should work as an enterprise-wide function. This chapter covers a number of
improvement opportunities and launch projects.
tools and methods for brainstorming and selecting projects that are most likely to bring
Doing so lets leadership align project selection with organizational goals, ensure projects are
significant improvement to processes and serve overall business goals.
organized in a way that matches resources, and keep a bird’s eye view of improvement
endeavors.
No formula exists for how many Six Sigma projects a company should run at a given time,
Organizations can apply a five-step procedure for identifying viable Six Sigma improvement
but a few well- designed projects are more likely to make greater impact than many poorly
projects.
designed, overlapping, or unfunded projects. Organizations should only launch projects
they can: 1. Data-Based Review of Current State of the Organization

1. Fund 2. Brainstorm and Describe Potential Projects

2. Support with people resources 3. Apply Some Basic Criteria to Shorten the List

4. Create Unique Business Criteria

3. Manage
5. Use Business Criteria to Prioritize Project Lists

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Data-Based Review of Current State of the Create Unique Business Criteria

Organization
Organizations can begin with a high-level look at internal and external sources of information After removing project ideas that don’t fit Six Sigma methodology, teams should create and
about performance. Internal information might include complaints or issues raised by apply business criteria to further filter the list.
employees, existing performance metrics or reports, financial reports, and quality reports. Business criteria usually come in the form of expenses, monetary gains, impact on customer
External sources include all of the Voice of the Customer tools. satisfaction, and urgency. Some questions teams might ask include:

In reviewing internal and external information, organizations should ask: • How will the improvement impact revenue-facing measurements such as profit,
orders, or income?
• What types of things are customers or employees complaining about? • What savings will the improvement create?
• Where is the organization falling short of benchmarks or competitor performance? • How is the problem trending? Is it becoming a bigger and more urgent issue quickly,
• What needs do customers have that the organization is not meeting? or can the organization operate with minimal impact without making an immediate or
• What needs might customers have in the near future that the organization is not yet near-future change?
able to meet? • How much will the improvement cost?
• What processes are outputting the most defects? • How many employees/employee hours will be required for the improvement?
• What processes are known for the most rework? • What resources are required for the improvement?
• What are the slowest or most expensive processes in the organization?
• What are some obstacles keeping the organization from reaching its goals?

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Use Business Criteria to Prioritize Project Lists The Project Viability Model
Criteria Definition
Using the business criteria, teams should prioritize projects and select projects from the top 1. Sponsorship The project is likely to be sponsored at a high level. (For more information on project sponsorship, see the team building information in
Chapter 10). Sponsorship increases the chance that teams will have access to the funds and resources required for a successful potential
of the prioritized list for immediate work. One of the best ways to prioritize projects is to project.
create a selection matrix with defined criteria and a numerical ranking system. The goals of the project are aligned with the goals of the business. Working on potential projects that aren’t aligned with business goals
2. Corporate alignment
can reduce business effectiveness.
3. Data Data is available or can be accessed so the team can design project metrics. Without access to data, a Six Sigma methodology can’t be
For example, using the example questions in step four, we might create the following list of applied. If data is excessively time-consuming or expensive to collect, then the potential project is usually not the best choice.

criteria: 4. Definition of defect There is a specific, well-defined defect or problem. Without a well- defined defect, potential projects run the risk of scope creep.
• Potential savings
5. Stability The potential process is stable and there are no expectations that the process is going to be overhauled, redesigned, or changed in the
• Potential cost near future. There is usually no reason to spend time and money improving a process that will drastically change soon anyway.

• Potential increase to revenue 6. Customer The planned goal of the potential project would create a substantial and positive impact on customer satisfaction or perception of quality.

• Ability to access resources needed 7. Benefits The potential project has a strong cost-benefit ratio.
8. Timeline The timeline for a potential project is relatively short. Timelines for most Six Sigma improvement projects are around 6 months, though some
do run longer. Longer timelines decrease the chance that an improvement fits within the DMAIC methodology.
Savings Costs Revenue increase Access to
9. Solution The potential project purpose is to find a solution that is not already known or defined. As we previously stated, if a solution is obvious, you don’t need to
resources Total run a project to find it.
10. Implementation is likely A solution identified and verified by the potential project is likely to be implemented. If, for any reason, change is very unlikely within a process, then going
Project 1 through Six Sigma improvement work is a waste of resources.
1 8 9 10
28 11. Required investment The potential project requires a large investment of cash. Generally, the greater the cash or capital investment required, the less likely a project will be
selected or a solution will be implemented due to cost- benefit analysis.
Project 2 5 5 4 6 20
12. Available Six The Black and Green Belts required for the project are available.
Sigma Resources
Project 3 10 2 2 2 16 21 13. Inputs can be controlled For a Six Sigma process improvement project to be successful, at least some of the inputs must be within control of the team or organization. For example,
a team can’t work to improve the quality of a part that is provided wholly by a vendor.

14. Redesign The process can be improved as is and doesn’t need a complete redesign.
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15. Process quality is The improvement doesn’t negatively impact the quality of service or products along the value chain.
improved/maintained

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Project Selection at a Process Level Project Selection at a Process Level

Weight No Mostly Possibly (3) Mostly Yes

(1) No (2) Yes (4) (5)
Is there a sponsor or champion?
Do project goals align with corporate goals?
Is data available or accessible?
Score DMAIC Viability
Are defects well defined?
Is the process stable? < 2.0 Not viable for DMAIC
Are there customer benefits to the project?
Are there company benefits to the project?
2.0 to 3.0 Possibility viable, but organizations shouldvalidate further
Can the project be completed within 6 months?
Is the solution unknown?
Is it likely a discovered solution will be implemented? Above 3.0 A viable DMAIC project
Would a new solution cost little to no cash?
Are Six Sigma team members available for the project?
Can inputs in the process be controlled?
Can the process be improved without a full redesign?
Will the improvements maintain or improve qualityacross
the value chain?
TOTALS:
Score:

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Six Sigma leadership group

Some roles of a high-level Six Sigma leadership group include:

❖ Creating a rationale for the use of Six Sigma in the organization and
supporting process improvement as a cultural goal.

❖ Setting clear objectives for Six Sigma initiatives to ensure that project
goals align with business goals.

❖ Holding Six Sigma teams and the organization accountable for

Chapter 10 improvements and performance.

Basic Six Sigma Team Management ❖ Demanding and reviewing measurements of results

❖ Communicating wins and losses to the team in an honest manner.

❖ Rewarding teams and individuals for Six Sigma successes.

❖ Advocating for resources and funding for necessary improvement

projects.
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Building a Six Sigma Team Tips for Selecting Team Members

➢ Choosing employees who are knowledgeable about the customer, product, or process
➢ A Six Sigma leader
related to the project.

➢ A process owner ➢ Choosing employees who have shown a willingness and ability to work toward
improvement in a team environment.
➢ An expert on the process ➢ Selecting employees who have access to and an understanding of the data required to
learn about and measure the process or problem.
➢ Someone to manage
➢ Picking employees who can provide at least five hours of work per week to the team.
budgeting and accounting
➢ Matching the skills of employees to the projects at hand; if a project is likely to include
all technical improvements, you would be less likely to add a team member who is
skilled in marketing.

➢ Removing political obstacles through team selection; if a specific person in an

organization is likely to be an obstacle to a team, sometimes putting that person on the
team can increase the chance that they will buy into the process.

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Team Member Roles The Project Team

➢ Sponsors and Champions A Team comprises a group of people

➢ Business or Process Owners linked in a common purpose.
There is NO ‘I’ in the Team.
➢ Six Sigma Leaders
Team Building is a process of
➢ Project Managers
establishing and developing a greater
➢ Timekeeper sense of collaboration and trust between
member
➢ Scribes or Minute-Takers
Just forming a team is not building
➢ Team Members
one.

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Tuckman's Team Building Stages Define Communications

Effectiveness of communication is essential for desired action to happen.

2.Storming 4.Performing
“ Plan to Communicate”
1.Forming Voice and 3.Norming Synergy is created 5.Adjourning
Confronts ideas and becomes an
Getting to know Resolve conflicts
and perspectives. effective team.
each other. and begin to work
together, Solve problems as Completes the Top Down Bottom up Horizontal
Not much work is Necessary evil to Communication Communication Communication
team. work.
accomplished go through to Members trust
position Large amount of • Policies, • Feedback from the
each other. • Across functional
Learns about roles themselves in the work gets Moves on from the Instructions, operator, Project areas during
and teams Some amount of accomplished project and go on feedback on Status to the top problem solving,
responsibilities work with other performance from management
Top Management conflict
accomplished activities. resolution,
• Employee surveys, information
• Written Open door policy,
communication is Suggestion boxes sharing etc.,
better to avoid
filtration or
distortion of
message

Do not forget the Stage 4.a: Recognition of team members .

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Phased Based Timeline

Six Sigma projects usually follow a specific series of phases; we’ve briefly introduced
the concept of the DMAIC method. DMAIC breaks a project up into five phases: Define,
Measure, Analyze, Improve, and Control.

Experienced Six Sigma experts with some data and information about a project and
process can usually provide a very basic and raw estimate of time by assigning a certain
number of weeks to each phase. It’s also worth noting that most of the phases are
likely to overlap.
Developing Schedules & Budgets

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Milestone Meetings

You can also set up milestones within a team environment to manage

goals and tasks; these milestones can be kept within the team. For
example, a team working for a chain of sandwich shops is hoping to
improve the process by which sandwiches are put together. They have
set up the following milestones:

❖ Define: January 21

❖ Measure: February 12 Chapter 11

❖ Analyze: February 22 Introduction to DMAIC and DMADV
❖ Improve: March 15

❖ Control: April 10

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What is DMAIC DMAIC versus DMADV

Some roles of a high-level Six Sigma leadership group include:

❖ Creating a rationale for the use of Six Sigma in the organization and
supporting process improvement as a cultural goal.

❖ Setting clear objectives for Six Sigma initiatives to ensure that project
goals align with business goals.

❖ Holding Six Sigma teams and the organization accountable for

improvements and performance.

❖ Demanding and reviewing measurements of results

❖ Communicating wins and losses to the team in an honest manner.

❖ Rewarding teams and individuals for Six Sigma successes.

❖ Advocating for resources and funding for necessary improvement

projects.
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Phase 1: Define Phase 2: Measure

➢ During a DMAIC project, the Define ➢ The DMAIC Measure phase is when teams use
phase is concerned with identifying the data to validate their assumptions about the
problem, defining requirements for the process and the problem. Validation of
assumptions also merges into the analyze
project, and setting goals for success
phase. The bulk of the measure phase is
➢ In a DMADV project, the Define stage is occupied with actually gathering data and
slightly more rigid. Teams also have to formatting it in a way that can be analyzed.
identify a problem and begin defining ➢ Teams working through a DMADV approach
requirements, but requirements must be might do some of the same things during the
made within a change-management Measure phase, but activities are typically more
environment. targeted. Teams will likely collect data and
measurements that help them define
performance requirements for the new process.
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Phase 3: Analyse Phase 4: Improve or Design

➢ During the Analyze phase of a DMAIC project, teams ➢ Six Sigma teams start developing the ideas that began in
develop hypotheses about causal relationships between the Analyze phase during the Improve phase of a project.
inputs and outputs and between Xs and Ys, they narrow They use statistics and real-world observation to test
causation down to the vital few (using methods such as the hypotheses and solutions. Hypothesis testing actually
Pareto principle), and they use statistical analysis and data begins in the analyze phase, but is continued during the
to validate the hypotheses and assumptions they’ve made improve phase as teams select solutions and begin to
so far. implement them.

➢ A team using DMADV might also identify cause and effect ➢ The fourth phase is where DMADV projects begin to diverge
relationships, but they are usually more concerned with substantially from DMAIC projects. The team actually works
identifying best practices and benchmarks by which to to design a new process, which does involve some of the
measure and design the new process. Teams might also solutions testing mentioned above, but also involves
begin process design work by identifying value- and non mapping, workflow principles, and actively building new
value-added activities, locating areas where bottlenecks or infrastructures. That might mean putting new equipment in
errors are likely, and refining requirements to better meet place, hiring and training new employees, or developing new
the needs and goals of the project. software tools. Teams also start to implement the new
systems and processes during the fourth phase.
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Phase 5: Control or Verify Lean Six Sigma Process Improvement Projects

➢ For DMAIC and DMADV teams, the control or

verify phase is where loose ends are tied and
the project is transitioned to a daily work
environment.

➢ Controls and standards are established so that

improvements can be maintained, but the
responsibility for those improvements is
transitioned to the process owner.

➢ During the transition, the Six Sigma team might

work with the process owner and his or her
department to troubleshoot any problems with
the improvement.
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