CUSTOMER

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D
ESIGN FOR
SIX SIGMA
CUSTOMER COMPETITIVE INTELLIGENCE FOR PRODUCT,
PROCESS, SYSTEMS ENTERPRISE EXCELLENCE
DEPARTMENT OF STATISTICS
REDGEMAN_at_UIDAHO.EDU
OFFICE 1-208-885-4410
DR. RICK EDGEMAN, PROFESSOR CHAIR SIX SIGMA
BLACK BELT
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IGMA
a highly structured strategy for acquiring,
assessing, and applying customer, competitor, and
enterprise intelligence for the purposes of
product, system or enterprise innovation and
design.
DEPARTMENT OF STATISTICS
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Design for Six Sigma Applications of Six Sigma
that focus on the design or redesign of products
and services and their enabling processes so
that from the beginning customer needs and
expectations are fulfilled are known as Design
for Six Sigma or DFSS. The aim of DFSS is to
create designs that are resource
efficient, capable of exceptionally high yields,
and are robust to process variations. This aim
produces a recasting of DMAIC that can be
characterized as Define-Measure-Analyze-Design
-Verify (DMADV) or as Invention-Innovation-Design-
Optimize-Verify (I2DOV) or as CDOV
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Six Sigma from the GE Perspective Six Sigma is
a highly disciplined process that helps a company
focus on developing and delivering near-perfect
products and services. Why sigma? The word is
a statistical term that measures how far a given
process deviates from perfection. The central
idea behind Six Sigma is that if you can measure
how many defects you have in a process, you
can systematically determine how to eliminate
those and approach zero defects. Six Sigma has
changed the DNA at GE it is the way that GE
works in everything that GE does and in every
product GE designs. What is Six Sigma? The
Roadmap to Customer Improvement www.ge.com/sixsig
ma/makingcustomers.html
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Design for Six Sigma at GE DFSS is changing GE.
With it GE can build on all of its capabilities
and take all of its product and process designs
to a new level of world-class performance and
quality. The essence of DFSS is predicting
design quality up front and driving
quality measurement and predictability
improvement during the early design phases- a
much more effective and less expensive way to get
to Six Sigma quality than trying to fix problems
further down the road. What We Do. GE Corporate
Research and Development Formerly posted at
www.crd.ge.com/whatwedo/sixsigma.html
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• Another View of Design for Six Sigma
• DFSS is the change in the product design
  organization from a deterministic to a
• probabilistic culture. Our people were trained to
  incorporate statistical
• analysis of failure modes, both in products and
  processes. Then they began
• to incorporate design changes that modify and
  eliminate design features
• with a probability of failure within a predefined
  range of operating
• environments and conditions. The design
  organization changed from a
• factor-of-safety mentality to one in which
  there was a quantitative assessment
• of design risk. Four elements of design are most
  critical to the effort
• Design for producibility (design for
  manufacturing and assembly)
• Design for Reliability
• Design for Performance (technical requirements)
  and
• Design for Maintainability.
• Design for Six Sigma 15 Lessons Learned,
  Quality Progress, Vol. 35, No. 1, pp. 33-42,
  January 2002.

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Voice of the Customer
Improve
Analyze
Measure
Define
Control
Institutionalization
The DMAIC Model
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Define the problem and customer requirements. Me
asure defect rates and Document the process in
its current incarnation. Analyze process data
and Determine the capability of the
process. Improve the process and remove defect
causes. Control process performance and ensure
that defects do not recur.
Define
Control
Measure
Improve
Analyze
Six Sigma Innovation the DMAIC Algorithm
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Team Charter Project Scoping Of similar
importance structure as in DMAIC
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Team Charter
Table of Contents   1.  
EXECUTIVE SUMMARY 3 2.  
PROJECT OBJECTIVES3 3.  
PROJECT SCOPE ..3 4.  
BUSINESS CASE 3 5.  
PROJECT ORGANIZATION 3 6.  
SCHEDULES.4 7.  
COMMUNICATION PLAN ...4 8.
  PROJECT CONTROL PROCEDURES ...4
9.   PROJECT ASSUMPTIONS ..4
10. CONFLICT RESOLUTION . 5
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Project Scope

• On what process will the team focus on?
• What are the boundaries of the process we are to
  improve? Start point? Stop point?
• What resources are available to the team?
• What (if anything) is out-of-bounds for the team?
• Under what (if any) constraints must the team
  work?
• What is the time commitment expected of team
  members?
• What are the advantages to each team member for
  the time commitment?

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SMART

• Problem Goal Statements Should be
• Specific
• Measurable
• Attainable
• Relevant
• Time-Bound

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Eight Steps for Establishing Project Boundaries

• Identify the customer
• Who receives the process output?
• (May be an internal or external customer)
• Define customers expectations and needs
• Ask the customer
• Think like the customer
• Rank or prioritize the expectations
• Clearly specify your deliverables tied to those
  expectations
• What are the process outputs? (Tangible and
  intangible deliverables)
• Rank or prioritize the deliverables
• Rank your confidence in meeting each deliverable
• Identify CTQs for those deliverables
• What are the specific, measurable attributes that
  are most critical in the deliverables?
• Select those attributes that have the greatest
  impact on customer satisfaction.

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Eight Steps for Establishing Project Boundaries

• Map your process
• Map the process at it works today (as is).
• Map the informal processes, even if there is no
  formal, uniform process in use.
• Determine where in the process the CTQs can be
  most seriously affected
• Use a detailed flowchart
• Estimate which steps contain the most variability
• Evaluate which CTQs have the greatest
  opportunity for improvement
• Consider available resources
• Compare variation in the processes with the
  various CTQs
• Emphasize process steps which are under the
  control of the team conducting the project
• Define the project to improve the CTQs you have
  selected
• Define the defect to be attacked

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The SIPOC Model
Process Steps
Inputs
Outputs
Suppliers
Customers
Inform Loop
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Six Sigma COPIS Model
Process Steps
Outputs
Inputs
Suppliers
Customers
How does Six Sigma Work?
The Voice of the Customer (VOC) is aggressively
sought and rigorously evaluated and used to
determine needed outputs and hence the optimal
process configuration needed to yield those
outputs and their necessary inputs for which the
best suppliers are identified and allied
with. From Concept to Market the Voice of the
Customer
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D
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DFSS LESSONS LEARNED LEADERSHIP
DEPARTMENT OF STATISTICS
REDGEMAN_at_UIDAHO.EDU
OFFICE 1-208-885-4410
DR. RICK EDGEMAN, PROFESSOR CHAIR SIX SIGMA
BLACK BELT
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Design for Six Sigma at GE DFSS is changing GE.
With it GE can build on all of its capabilities
and take all of its product and process designs
to a new level of world-class performance and
quality. The essence of DFSS is predicting
design quality up front and driving
quality measurement and predictability
improvement during the early design phases- a
much more effective and less expensive way to get
to Six Sigma quality than trying to fix problems
further down the road. What We Do. GE Corporate
Research and Development Formerly posted at
www.crd.ge.com/whatwedo/sixsigma.html
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Design for Six Sigma Define-Measure-Analyze-Design
-Verify (DMADV) Define customer requirements and
goals for the process, product or
service. Measure and match performance to
customer requirements. Analyze and assess the
design for the process, product or
service. Design and implement the array of new
processes required for the new process,product or
service. Verify results and maintain performance.
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• ImprovementFocuses on high priority problems in
  business processes. This uses the DMAIC
  methodology Define, Measure, Analyze, Improve,
  and Control.
• DesignDesign For Six Sigma (DFSS) addresses new
  or fundamentally poor processes. The methodology
  is called the DMADOV model Define, Measure,
  Analyze, Design, Optimize, and Verify.
• Business Process Management aids in definition
  and management of operations and activities in
  terms of core and enabling processes. The
  resulting process management systems provide a
  foundation of process definition and baseline
  data for all process design and improvement
  activities.

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DFSS as a Growth Strategy Lesson 1 Achieving
world-class performance through any set of tools
takes careful preparation and a commitment to the
foundational change efforts required for
world-class capability.
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DFSS as a Growth Strategy Lesson 2 DFSS grows
into program profits in direct proportion to the
size of the initial investment. The more the
initial investment to eliminate (adverse) design
issues, the greater the life cycle profits that
will be realized.
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DFSS as a Growth Strategy Lesson 3 A
structured compensations system that
substantially rewards leadership cooperation and
co-ownership for successfully implementing
cross-functional DFSS projects significantly impro
ves the bottom line. Note the corporate
example that produced the most impressive results
was a firm where DFSS involvement was directly
linked to management rewards. This firm REQUIRED
senior management to spend 30 of its time on
DFSS activity.
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DFSS as a Growth Strategy Lesson 4 Leaders,
especially middle managers, need to be selected,
prepared and trained much earlier in the
process to achieve desired levels of commitment.
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DFSS as a Growth Strategy Lesson 5 DFSS
should be regarded as a part of doing business
and represent of part of reinvesting a portion
of the profits into the business to produce even
greater profits in the long run. If DFSS is to
be the driving force, the heart and soul of a
business, then adequate dollars, time and
resources must be incorporated into the annual
budget to ensure the companys success. Success
is rarely the result of unplanned, fortuitous
accident.
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DFSS as a Means of Serving Customers Lesson 1
Continual customer feedback and ideas are
essential to achieve a partnership with the
customer. In an age where competition for
customers is relentless, companies that make the
customer a partner in the DFSS activity and
maintain that partnering throughout the product
life cycle have a customer for the product life
cycle.
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DFSS as a Means of Serving Customers Lesson 2
A DFSS must be inclusive, and a conscious
effort must be made to embed it in the fabric of
the entire organization. All employees must
understand how it works and why it benefits the
customer, the business and themselves.
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Product-Process Fusion Through DFSS Lesson 1
Drive product and process compatibility across
the entire value chain and product life cycle.
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Product-Process Fusion Through DFSS Lesson 2
The value chain of your customer includes
everything incorporated into the final
product. Substantial elements often come from
suppliers and subcontractors. If they are not
integrated into the DFSS activity, then the final
product is sub-optimized.
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Product-Process Fusion Through DFSS Lesson 3
Six Sigma activity to reduce variability in the
factory is a losing process if the new designs
cause new variability. DFSS is intended to
reduce the introduction of new variability and
achieve process stability and uniform quality
faster.
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Product-Process Fusion Through DFSS Lesson 4
Metrics must tell the story of the
organizations performance AND must be discussed
regularly among the staff in each area.
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Product-Process Fusion Through DFSS Lesson 5
DFSS can have applicability in
diverse industries some that are nontraditional
such as pharmaceuticals, if the design and
production is integrated and balanced.
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The DFSS Engineering Organization Lesson 1
Design organizations are struggling with the
loss of domain knowledge and lack of
experience and skills among the DFSS teams
themselves. This slows the movement to
probabilistic design approaches as there seems to
be little time to meet schedules and conduct
thorough analysis using statistical tools.
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The DFSS Engineering Organization Lesson 2
Enlarging the responsibility of design
engineering to follow the product from start to
finish creates ownership that changes the
approach to product design. It accelerates the
incorporation of lessons learned outside the
design studio.
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The DFSS Engineering Organization Lesson 3
The trend toward engineering efficiency in
which organizations assign engineers from pools
to cover assignments has made engineers a
commodity at just the point in time when the loss
of domain knowledge makes the need for longevity
in an organization essential.
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D
ESIGN FOR
SIX SIGMA
And Lean Management
DEPARTMENT OF STATISTICS
REDGEMAN_at_UIDAHO.EDU
OFFICE 1-208-885-4410
DR. RICK EDGEMAN, PROFESSOR CHAIR SIX SIGMA
BLACK BELT
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The People of Six Sigma
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Six Sigma Champions

• Create the vision of Six Sigma for the company.
• Define the path to implement Six Sigma across the
  organization.
• Develop a comprehensive training plan for
  implementing the Breakthrough Strategy.
• Carefully select high-impact projects.
• Support development of statistical thinking.
• Ask Black Belts many questions to ensure that
  they are properly focused.
• Realize the gains by supporting Six Sigma
  projects through allocation of resources and
  removal of roadblocks.
• Hold the ground by implementing Black Belt
  recommendations.
• Make sure that project opportunities are acted
  upon by the organizations leadership and the
  finance department.
• Recognize people for their efforts.

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Master Black Belts

• Understand the big business picture.
• Partner with the Champions.
• Get certified as Master Black Belts.
• Develop 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.
• Help train and certify Black Belts.
• Take on leadership of major programs.
• Facilitate sharing of best practices across the
  corporation.

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Black Belts

• Act as Breakthrough Strategy experts and be
  Breakthrough Strategy enthusiasts.
• Stimulate Champion thinking.
• Identify the barriers.
• Lead and direct teams in project execution.
• Report progress to appropriate leadership levels.
• Solicit help from Champions when needed.
• Influence without direct authority.
• Determine the most effective tools to apply.
• Prepare a detailed project assessment during the
  Measurement phase.
• Get input from knowledgeable operators,
  first-line supervisors, and team leaders.
• Teach and coach Breakthrough Strategy methods and
  tools.
• Manage project risk.
• Ensure that the results are sustained.

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Black Belt Activities

• MENTORS Cultivates a network of Six Sigma
  individuals at the local organization or site.
• TEACH Provides formal training of local
  personnel in new strategies and tools.
• COACH Provides one-on-one support to local
  personnel.
• TRANSFER Passes on new strategies and tools in
  the form of training, workshops, case studies,
  and local symposia.
• DISCOVER Finds application opportunities for Six
  Sigma strategies and tools, both internal and
  external (e.g. suppliers and customers).
• IDENTIFY Highlights / surfaces business
  opportunities through partnerships with other
  organizations.
• INFLUENCE Sells the organization on the use of
  Six Sigma strategies and tools.

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Green Belts

• Function as Green Belts on a part-time basis,
  while performing their regular duties.
• Participate on Black Belt project teams in the
  context of their existing responsibilities.
• Learn the Six Sigma methodology as it applies to
  a particular project.
• Continue to learn and practice the Six Sigma
  methods and tools after project completion.

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Corporate Six Sigma Leadership
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Six Sigma and General Electric

• General Electric CEO, Jack Welch, describes Six
  Sigma as the most important initiative GE has
  ever undertaken. GEs operating income, a
  critical measure of business efficiency and
  profitability, hovered around 10 for decades. In
  1995 Welch mandated that each GE operation from
  credit card services to aircraft engine plants to
  NBC-TV work toward achieving Six Sigma. GE was
  averaging about 3.5? when it introduced the
  program.
• With Six Sigma embedding itself deeper into GEs
  processes, they achieved the previously
  impossible operating margin of 16.7 in 1998
  up from 13.6 in 1995.
• In dollar amounts, Six Sigma delivered more than
  300 million to GEs 1997 operating income and
  more than 600 million in 1998.

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Six Sigma and Raytheon

• Former AlliedSignal executive Daniel P. Burnham,
  who became Raytheons CEO in 1998, has made Six
  Sigma a cornerstone of the companys strategic
  plan.
• By pursuing Six Sigma quality levels throughout
  the company, Raytheon to improved its cost of
  doing business by more than 1 billion annually
  by 2001.

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Six Sigma and the Service Sector Robert Galvin
Former Motorola CEO

• Failing to implement Six Sigma in commercial
  areas with the same force that the company
  implemented it in its industrial sectors cost
  Motorola 5 billion over a four-year period.

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How Big is the Service Sector?

• 79 of the U.S. Workforce is employed by
  commercial businesses.
• 90 of those employed in manufacturing are
  actually doing service work such as finance,
  marketing, sales, distribution and purchasing.
• So 79 (.9)(21) 98 of the U.S. Workforce
  is involved in service work.
• MISTAKEN BELIEFS
• Some companies still believe that improving
  commercial processes is less important than
  improving industrial processes or that seemingly
  intangible commercial processes cant be
  controlled.
• BOTH ARE WRONG
• Customers are more likely to take their business
  elsewhere because of poor service than poor
  products.
• Companies like GE have shown that improving
  internal and external commercial processes adds
  to the bottom line and to customer satisfaction
  significantly

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AlliedSignal

• 70,000 Employees
• Chemicals, Fibers, Plastics, Aerospace Products,
  Automotive Products.
• Larry Bossidy came from GE to become CEO in 1991
• Market Value 4 billion in 1991
• Market Value 29 billion by the end of 1998
• Market Value 38 billion by 2000.

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AlliedSignal

• TODAYS GOALS
• 6 productivity increase
• Reduced Inventory
• Full-Capacity Utilization
• Little or no Overtime
• Reliable Products
• 5s Manufacturing
• 5s Designs
• Predictable Cash Flow
• 5s Suppliers

• BY END OF 1998
• Total Impact of Six Sigma Within AlliedSignal
  Reached 2 Billion.
• Six Sigma Profits in Service Areas including
• Order Processing
• Shipping
• Procurement
• Product Innovation

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We cant tell other organizations how to do Six
Sigma, but we can tell them how not to do it.
Allied has made mistakes along the way and, in
the process, learned some tremendous lessons.

• Lesson 1 The Organizations Leadership Must Own
  Six Sigma
• Upper management supported Six Sigma, managers
  below those at the top saw it as a flavor of the
  month.
• Black Belts seen as a nuisance.
• Black Belts were using Six Sigma jargon while
  managers were using business vocabulary. This led
  to confusion.
• SOLUTION Introduce ALL levels of management to
  Six Sigma.
• Management had weeklong training sessions to
  understand the methods of the Breakthrough
  Strategy and how Black Belt training and
  experience could be leveraged. ALSO how various
  initiatives fit together.
• BEGAN TO FOCUS ON PROCESSES NOT PEOPLE as the
  source of problems. Also, understanding of the
  Breakthrough Strategy provided a plan of
  action, rather than just a command to make
  something happen.

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Six Sigma Changed the Company Culture and

• One of the flaws at Allied is that we had too
  much vertical mobility. Managers inch up the same
  smokestack, learning more and more about less and
  less. But companies that train promising
  individuals as Black Belts circumvent the
  vertical flow and move people around
  horizontally, having them serve time in as many
  major businesses or divisions as possible to give
  them a kaleidoscopic view of the organization and
  the benefit of being mentored by a variety of new
  blood.

Linked AlliedSignals Goals, Vision Activities.
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• Having recognized the need to train managers in
  the Six Sigma Breakthrough Strategy, Allied
  dedicated the next year to training 1,000 leaders
  in the organization in how Six Sigma worked, and
  in its potential financial impact.
• Training sessions lasted 3.5 days and emphasized
  Six Sigmas impact on
• Profitability through improved processes
• The Crucial role of Black Belts, RATHER THAN
  teaching statistical processes involved in
  achieving Six Sigma.
• Initially trained top managers at each of
  Allieds 11 Strategic Business Units and
  gradually worked their way down the organization
  to middle management, line supervisors, and so
  on.
• COMPLAINTS FROM BLACK BELTS WITHIN SIX MONTHS
  Management turnover and too much promotion of
  Black Belts into management before benefit from
  the training and skills could be realized. SO
  training had to be ongoing.

Allied is not in the business of measuring
activity. We are in the business of measuring
results. IF something doesnt have a positive
impact on customer satisfaction, our
shareholders, and employees, and in the process
makes a lots of money, THEN we just flat out
arent going to do it. RICHARD A. JOHNSON,
Director of Six Sigma at AlliedSignal
Lesson Two A Beginning Without an End
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• AlliedSignals goal send Black Belts with a
  minimum of 18-24 months experience mastering the
  Breakthrough Strategy back into the organization
  to create Six Sigma behavior thinking.
• 40 of Black Belts were promoted to departmental
  or plant managers. Others left AlliedSignal for
  higher-paying jobs at suppliers. Others completed
  only one or two projects before they were pulled
  back into their previous assignments with
  leadership not properly reviewing projects and
  properly acting upon financial opportunities
  created by Black Belts so that managers felt that
  Six Sigma wasnt particularly important.
• 50 of Black Belts were absorbed back into the
  organization within six months.
• NOW BLACK BELTS must work at least 18-24 months
  on a series of Six Sigma projects prior to a
  change of roles. TIME EXPERIENCE ARE VIEWED AS
  CRITICAL TO SIX SIGMA SUCCESS AND THE MATURITY OF
  THE BLACK BELT.

Lesson Three Black Belt Retention
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Lesson Three - Continued

• AlliedSignals Champions Master Black Belts
• 3.5 Day Executive Overview followed by the
  traditional Four-Month Black Belt training
  process.
• MASTER BLACK BELTS are selected from the best of
  the Black Belts.
• Each of these trains and mentors 10 Black Belts
• Each Black Belt trains and mentors 10 Green
  Belts.
• NOW All Salaried Employees are Expected to
  Undergo the 26 Hours of Training Required for
  Green Belt Certification by 2000.
• CHAMPIONS 20 Master Black Belts 70
• Black Belts 2000 Green Belts 18,000
• Total of Employees 70,000

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Lesson Four Supplier Capability is Critical to
the Success of the Breakthrough Strategy

• The Majority of AlliedSignals Suppliers were
  operating at about three sigma.
• This prevented the company from realizing the
  full benefits of Six Sigma.
• AlliedSignal recognized that they needed to view
  suppliers as their partners.
• AlliedSignal began TRAINING its suppliers and
  offering other technical assistance.
• To achieve Six Sigma it is important to minimize
  the number of suppliers, limiting these to those
  that have been trained in the Breakthrough
  Strategy.
• Not only does AlliedSignal provide training, BUT
  then follows up by dedicating ITS OWN BLACK BELTS
  to mentor and work with critical suppliers.
  AlliedSignal estimates that for every 300 Black
  Belts it trains, 100 are either customers or
  suppliers.

W. Edwards Deming End the Practice of Awarding
Business on Price Tag Alone.
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Lesson FiveThere is No Such Thing as Operator
Error

• It is PROCESSES not PEOPLE that Fail.
• This maps to one of Demings 14 Points for
  Management DRIVE OUT FEAR.
• Focus on Processes implies that people are not
  accused, but rather, that they are able to
  investigate processes and be part of the
  solution.

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Lesson Six Focus on Bottom-Line Improvement

• The number one source of failure in deploying Six
  Sigma is the result of Lack of Commitment FROM
  THE Organizations Leadership.
• The Finance Department must be involved so that
  the impact of Six Sigma Projects on the
  Bottom-Line is apparent.
• Black Belts, the Finance Department, and
  Executive Leadership must work in tandem.
• While Black Belts create opportunities for cost
  reduction and increased profitability, the
  companys Leadership must make sure that Black
  Belts focus on the right projects and take action
  on the savings opportunities they generate.
  Finance provides closure to the effort by
  ensuring that the savings are returned to the
  organizations bottom line.

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Lesson Seven Initiative Overload

• LARRY BOSSIDY, CEO One of the things I have
  trouble with is non-financial objectives. Often
  theyre just as obscure and vacuous as they
  sound.
• FIVE ACTIONS TO PERPETUATE SIX SIGMA
• TRAINING Allieds employee base changes enough
  every nine to ten months that maintenance of Six
  Sigma culture requires that new employees be
  trained in the Breakthrough Strategy.
• Senior management involvement.
• Continued on-site leadership training, and
  alignment of goals among divisions to reinforce
  Breakthrough Strategy thinking and goals.
• Requiring Black Belts to dedicate a minimum of
  two years to working on Six Sigma projects.
• Supplier involvement and improvement in Six Sigma
  initiatives.

Products and services should be improved ONLY to
the degree that customer value is increased. Six
Sigma is a program designed to generate money for
the company, either through savings resulting
from reduced costs, or from boosting sales by
increasing customer satisfaction.
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AlliedSignalHindrances to Six Sigma Success

• Working on too many improvements at the same
  time.
• Not having someone accountable for the problem.
• Not being a process-based company.
• A lack of trained and experienced people.
• Middle managers who fear uncertainty about future
  roles.
• Lack of metrics focused on customer value-added
  processes.
• Lack of integrated information and financial
  systems.
• Fragmented, staff-driven approaches.

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D
ESIGN FOR
SIX SIGMA
End of Session
DEPARTMENT OF STATISTICS
REDGEMAN_at_UIDAHO.EDU
OFFICE 1-208-885-4410
DR. RICK EDGEMAN, PROFESSOR CHAIR SIX SIGMA
BLACK BELT