bb wk1 170 project id select
TRANSCRIPT
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Project
Identification, Selection, Scoping,
And Definition
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Project Identificat ion, Selection, And Scoping Pg 1
The Breakthrough Strategy® – Project Scoping And Definition
1. Select Output Characteristic
2. Define Performance Standards
3. Validate Measurement System
4. Establish Baseline Process Capability
5. Define Performance Objectives
6. Identify Variation Sources
7. Screen Potential Causes
8. Discover Variable Relationships
9. Establish Operating Tolerances –
Implement Improvements
10.Validate Measurement System
11.Determine Final Process Capability
12.Implement Process Controls
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Project Identificat ion, Selection, And Scoping Pg 2
Module Objectives
By the end of this module, the participant will be able to:
• Explain how projects are identified, selected, scoped, and defined
• Use Performance to Plan method or Bubble up Organic ideas toidentify projects
• Prioritize project opportunities
• Create a SIPOC
• Prepare a concise project definition including problem statement,objectives, and linkage to top-level goals
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Project Identificat ion, Selection, And Scoping Pg 3
Why Project Identification – Definition Is So Critical
• Management should only apply resources to
activities that support the business objectives
• Management should only spend time onactivities that support the business objectives
• Poor project selection/definition is the #1
reason for poor Six Sigma results• Project success is the true validation of your
Six Sigma endeavor
Maintaining a project pipeline is theengine for Six Sigma success!
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Project Identificat ion, Selection, And Scoping Pg 4
Project Road Map
• Identify opportunities in organization
to select projects from.
• Select projects based onprioritization criteria.
• Scope project to ensure successfuland timely results.
• Define project for measurableobjectives and responsibilities.
Project Identification
Project Selection
Project Scoping
Project Definition
RecognizeOpportunities
ImplementBTS
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Project Identification
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Project Identificat ion, Selection, And Scoping Pg 6
Project Identification
Project Identification
Project Selection
Project Scoping
Project Definition
RecognizeOpportunities
ImplementBTS
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Project Identificat ion, Selection, And Scoping Pg 7
Project Identification Continuum
• Discrete projects are identified and chosen by Black Belts
• Management brainstorms and identifies projects
• Projects are selected from a brainstormed list and mappedback to the strategic goals of the firm
• Strategic goals are determined and projects Flow Down fromthese goals based on available data
• Strategic goals are determined and a statistical relationshipis used to describe how the strategic goal is improved bycompleting the project
Least
Desirable
Most
Desirable
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Assessment Overview Pg 8
Diagnosis – 5 Assessment Pathways
• Balanced Scorecard/Strategic Goal Flow Down
- Purpose: Get senior executive involvement to ensure a plan isfollowed to meet strategic objectives
• Operational Assessment
- Purpose: Assess the value stream for opportunities
• Financial Analysis- Look at financial indicators for project opportunities
• Performance to Plan
- Identify weaknesses in forecasting and execution of budgetsand schedules
• Organic Project Pathway- Capture people‟s project ideas at all levels of the organization
Focus of this module
Focus of the„Utilizing 6-Sigma to
Deliver the Business
Plan‟ module
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Project Identificat ion, Selection, And Scoping Pg 9
Project Identification Approaches
Project Identificationa. Performance-to-Plan
b. Organic bubble up ideas
Based on the Project Selection Continuum, choice “a” by itself is themore desirable method because there is direct line of sight to a
performance metric.
Either way, these projects must still support the Business Plan!
a. A project may be identified based on the organizational goals; as theactual performance is measured against the plan, or
b. It may not be strategic in nature, but is a good idea and will save moneyor improve customer/employee satisfaction.
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Project Identificat ion, Selection, And Scoping Pg 10
Using Graphs To IdentifyProject Opportunities
• See the following 3 pages
• Data was plotted on a run from pages out of the monthly operationsreview. The review had a back up slide showing causes.
• Make sure you capture the persons name who identified the opportunityso you can refer to them when questions arise
• The project was entered in the “project portfolio spreadsheet”
• A Project Charter was written to improve the process
- The following pages were printed and stapled to the charter for reference
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Project Identificat ion, Selection, And Scoping Pg 11
With the current underlying processes, the company can expect to runapproximately 10% and 25% off schedule. The likelihood of being on time is low.
Data Source; include data source for future reference.
Example Of A Project OpportunityIdentified Using Run Charts
The Run Chart
indicates the
performance is not
acceptable to the
customer
Written by John Doe
Note:
Person who created
the charter 0
5
10
15
20
25
30
1 2 3 4 5 6 7 8 9 10 11 12
The goal is < 5%
Month
%
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Project Identificat ion, Selection, And Scoping Pg 12
Several reasons for „Off Schedule‟. Need to work top 9 areas to reduce
„Off Schedule‟ to acceptable level.
Data source: 03 Scheduling Compliance Report.xls
Example(Cont‟d)
Data Source; include data source for future reference.
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Project Identificat ion, Selection, And Scoping Pg 13
Several areas responsible for „Off Schedule‟. Need to work all 11 areas to
reduce „Off Schedule‟ to acceptable level.
Percentage of Batches Completed for 2003
8 7 . 5
%
7 7 . 0
%
9 0 . 4
%
8 8 . 8
%
8 5 . 7
%
7 6 . 9
%
8 7 . 6
%
8 3 . 6
%
8 2 . 6
% 8 9 . 2
%
8 8 . 2
%
70.0%
75.0%
80.0%
85.0%
90.0%
95.0%
Q C R a w
M a t e r i a l
( 6 7 3
)
C e n t r
a l W
e i g h ( 2
0 2 9 )
G r a n
u l a t i o n ( 1
1 4 4 )
B l e n
d i n g ( 1
1 3 1 )
C o m p
r e s s i o n ( 1
2 5 4 )
E n c a
p s u l a
t i o n ( 1 3 4 )
C o a t i n g
( 3 1 4 )
M R F -
F l u i
d B e d ( 5 9
0 )
M R F - E n
c a p s
u l a t e ( 3 2 8 )
P a c k a g i n g
( 9 0 9 )
F G R e l e
a s e ( 1
2 1 0 )
Example(Cont‟d)
Data Source; include data source for future reference.
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Project Identificat ion, Selection, And Scoping Pg 14
Historical Data Pitfalls
• History does not always repeat itself so be aware that some of the ideas
you find may not yield a project
• Be sensitive to the Process Owners. We may be pointing outmanagement issues, e.g., failure to meet budget or perform to a givenschedule. Choose your words carefully!
• Data integrity issues- There is not enough time to do an analysis of the measurement system
(MSA) used to collect the data. You may think you hit a big processproblem when, in fact, their process is good and their data is bad.
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Project Selection
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Project Identificat ion, Selection, And Scoping Pg 16
Project Road Map
Project Identification
Project Selection
Project Scoping
Project Definition
RecognizeOpportunities
ImplementBTS
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Project Identificat ion, Selection, And Scoping Pg 17
Project Candidate 1
Project Candidate 2
Project Candidate 3Project Candidate 5
. . . etc.
PROJECT FUNNEL
Project Ranking
Identified projectsare added to theProject Funnel
Prioritized Projects
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Project Identificat ion, Selection, And Scoping Pg 18
Black Belt Training Projects
• 70% reduction in defects is a typical goal
• Projects, especially first projects, should:
- Have high priority
- Include opportunities to learn and apply the appropriate tools
- Have a high probability of success, but solution is unknown- Have commitment of resources
- Focus on processes with frequent units and defects
- Have a measurement system in place
- Be executable in 4-6 months
- Be tightly focused with a precise defect definition
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Project Identificat ion, Selection, And Scoping Pg 19
A Project Selection Tool
7 5 4 8 9 3 6
R e v e n u e
G r o w t h
E a s e o f
c o m p l e t i o n
C u s t o m e r
s a t i s f a c t i o n
S a v i n g s
C y c l e t i m e
C a s h f l o w
Core
Process
Sub
Process Project Title
1 A 1 Bridgeport Efficiency 3 8 8 3 8 10 2 231
2 A 2 Spur Gear Defects 4 4 4 10 10 2 2 252
3 B 1 Chemical Waste Costs 1 1 1 1 9 1 9 162
4 B 2 Plating Adhesion 2 1 1 8 4 5 2 150
5 C 1 Lost Sales Bids 10 10 2 4 6 1 8 265
Rating of Importance to Project Desirability
Overall
Project
ValueRatings
Project Selection
Factors
Pro ect Selection Matrix - Desirabilit
• A Rating Matrix may be used to select individual projects
• Select the Factors that are of importance to your organization and rate howimportant they are in defining the desirability of a project. These desirabilityratings may be modified as times and conditions require.
• The individual projects are then rated against the Factors, these values aremultiplied by the desirability ratings and then summed for each project
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Project Identificat ion, Selection, And Scoping Pg 20
P r
o j e c t S e l e c t i o
n C h e c k l i s t
Project Selection
11. Is data collection relatively easy?
8. Can starting and end points for the process be defined?
2. Is there a pre-determined solution to the project goals?
3. Does this project conflict with other projects?
4. Does this project have a high probability of success?
5. Is project linked/aligned to goals of the business?
6. Does the cost reduction opportunity meet the goals of the business?
14. Can you define the defects in the process?
13. Are resources available and supportive for this project?
12. Is there a “good” measurement system in place?
10. Are metrics available or could they be developed quickly at low cost?
9. Does the Champion have functional control of the impacted process?
7. Has the project been properly scoped?
1. Has the project been done already (or in progress)?
NoYesProject Selection Criteria
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Project Identificat ion, Selection, And Scoping Pg 21
Another Method Of Project Selection
Increasing Value from Project Selection Matrix (No EOC)
I n c r e a s i n g E a s e
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Project Scoping
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Project Identificat ion, Selection, And Scoping Pg 23
Project Road Map
Project Identification
Project Selection
Project Scoping
Project Definition
RecognizeOpportunities
ImplementBTS
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Project Identificat ion, Selection, And Scoping Pg 24
Project Scoping
• At the end of the project selection process we frequently have a Project
“Cluster” or “Area” as apposed to a precisely scoped project
• In these cases, Project Scoping is the process that takes us from thegeneric to the specific
• Project Scoping minimizes the risks associated with improperly
scoped projects
Project Scoping is an intermediate step between theselection of a general project and the formal
“definition” of the project to be physically worked.
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Project Identificat ion, Selection, And Scoping Pg 25
Project Scoping
• The scope of a project refers to boundaries of the process and/or
the problem
• It is primarily the Project Sponsor‟s responsibility to define the initial scope
but the Black Belt and the Process Owner may be involved due to their closer involvement with the actual processes
Guidelines:• Brainstorm the start and end points of the process
- What will and will not be addressed?
• Evaluate potential issues vs. sphere of influence
- Are the boundaries within your control (organizationally)?
• Avoid scope creep
C C S S
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Project Identificat ion, Selection, And Scoping Pg 26
A Critical Component To Success – Scope
• If we have too large a scope (boi l the ocean o r end world hung er) we
wi l l fai l to accom pl ish the pro ject on t ime
• If we have too small a sco pe the Return On Investm ent (ROI) may no t
jus t ify the pro jec t
• Examples of poor scoping:
- Reduce total Work In Progress (WIP) inventory (what if sales volume
goes up?)
- Increase overall efficiency of General Merchandise Warehouse Flow(Labor or design issue or invoicing issue or Cycle Time or defects or…)
• Better scope:
- Reduce excess WIP inventory on list of high volume/high cost product asdetermined by weekly deltas between actual inventory and plannedinventory, e.g., adjusted for volume, time of year
- Reduce fulfillment rework of General Merchandise due to defects onthe invoices
S i Th P j
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Project Identificat ion, Selection, And Scoping Pg 27
Scoping The Project
Having quantified or estimated the baseline performance and compared it
against our goals/needs (a gap analysis):• Which gaps/issues should be addressed first?
• Should the project consist of resolving all of the gaps?
- If we have 5 characteristics in a process, is the project focused
on the one with the most defects, or the most costly defects, or ALLof them?
• Can/should the project be phased into 2 or more projects?
- For the same Black Belt?
- Should additional Black Belt resources be assigned?
• If the project can logically be broken into several complete integralstand-alone projects, the scope is probably too large
Note that Selecting and Scoping are closely related.Consider Scoping to be the fine tuning of the selection process.
S i P j t G l
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Project Identificat ion, Selection, And Scoping Pg 28
Scoping Projects – General
• These slides provide guidelines for scoping projects
• Much of your knowledge will develop as you obtain and analyze the data – This is critical
• SIPOC will be introduced
• Let‟s get started . . .
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SIPOCA High-level Process Mapping Tool
A Pi t I W th 1 000 W d
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Project Identificat ion, Selection, And Scoping Pg 30
A Picture Is Worth 1,000 Words
• Once we have selected our general project, it is highly recommended
that we create a Process Map to assist in our scoping and later our definition of the final project
- There are many types of charts, some of which are taught inother modules
- We will introduce 1 chart here, the SIPOC
- It is meant to be a high-level Process Map
- It clearly defines the customer (needed for definition)
- It helps identify the gaps between the process outputs and thecustomer requirements (scoping and focusing the project)
- It breaks the process down into macro steps which assists in scopingand focusing the project
• The SIPOC is useful throughout the early phases of the project, e.g., itidentifies suppliers of the process inputs
L l Of A P
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Project Identificat ion, Selection, And Scoping Pg 31
Levels Of A Process
Core
FunctionalDepartments
Sub-process
DetailedSub-process
BusinessProcess
(“Strategic”)
BusinessProcesses
High-level
Process Map
(SIPOC)
DetailedSub-process Map
BusinessDevelopment
Sales Underwriting ContractingCustomer
Service
Terms Docs Negotiate Close
Underwriters(external)Customers(internal)Customer Service Dept.
Customer
Tasks Procedures
Supplier
B i St t Of SIPOC
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Project Identificat ion, Selection, And Scoping Pg 32
Basic Structure Of SIPOC
S I P O C
Requirements Requirements
Suppliers Inputs Outputs CustomersInput Boundary Output Boundary
Process
High-level Process Map also known as SIPOC.
Projectcomes from
VOC
Eliminating Gap betweenOutput quality and Customer
Requirements is focus of project
SIPOC F G id E l V i
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Project Identificat ion, Selection, And Scoping Pg 33
Suppliers Inputs Process Outputs Customers(Providers of the requiredresources)
(Resourcesrequired bythe process)
(Top-level description of activity)
(Deliverablesfrom theprocess)
(Anyone who receives adeliverable from the
process)
Requirements Requirements7
Who is the
supplier of eachinput?
6What
Inputs arerequired toenable thisprocess to
occur?
8
Whatdoes theprocessexpect
from eachinput?
1What is
the
process?
3
What arethe
outputsfrom theprocess?
5
Whatdoes eachcustomer
expectfrom eachoutput?
4Who is thecustomer of each
output?
2When does
the Processstart?
Boundary
Boundary
S I P O C
SIPOC Form Guide – Excel Version
File: 140_SIPOC.xls
2When doesthe Process
end?
SIPOC E ample Widget Man fact ring
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Project Identificat ion, Selection, And Scoping Pg 34
SIPOC Example – Widget Manufacturing
Widget, Model A – Manufacturing Process
1. Load part # 23 “blank with pre-machinedchamfer” into fixture AA
2. Insert 3/8” drill bit into chuck 3. Drill 3/8” through hole 4. Remove and Inspect for Hole Location,
Diameter and Surface Finish5. Deburr and stack part
0.5”
2.5”
0.5”
0.5”
1.0”
1.5” 0.9”
MoveableJaw
Solid Jaw
PositiveStop
Fixture AA Drill attached
to solid jawPart #23
.375” dia
SIPOC Example Widget
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Project Identificat ion, Selection, And Scoping Pg 35
SIPOC Example – Widget
Suppliers Inputs Outputs(Providers of
the required
resources)
(Resources
required by
the process)
(Deliverables
from the
process)
Requirements Requirements
3/8 Diameter 3/8" +/-.005 Buyer
118 deg point angle
Sharp
Gashed Deburred
Tool Crib Fixture Fixture AA RMS<64 Buyer
1 HP Stacked Next Operator
Fixture cleaned Tool Room
Fixture put away Tool Room
Adjust Coolant
etc. etc. etc.
Operator Load Part Correct Orientation
etc. etc. etc.
Supervisor
Teardown
Parts
Hole Assembly
Operator
Production
Control
Supervisor Operator
Location per
Blueprint
Paperwork
complete
Chips brought toRecycle
Machine
cleaned
DrillTool Crib
Vice to hold Fixture
AA
Drill Area Drill press
Start with
Operator
receiving a
production
order for
Widgets
Process is to
set up, run,
clean,
inspect,and
stack parts
Ends with
Stacked parts
ready for
Material
Handler & set-
up dismantled
Adjust RPM and
feed rate
Run & check proof
part
Install & align
Fixture AA
Setup
Process Customers
(Top level description of the
activity)
(Anyone who receives a
deliverable from the process)
SIPOC Example: Airline Reservation
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Project Identificat ion, Selection, And Scoping Pg 36
SIPOC Example: Airline Reservation
Suppliers(Providers of the
required resources)
Inputs
(Resources requiredby the process)
Process
(Top level description of activity)
Outputs
(Deliverables fromthe process)
Customers
(Anyone who receives a deliverable fromthe process)
Requirements Requirements
Client Request for Travel Dates ServiceProfessional and
Courteous
Business/CorporateTraveler
Company
Company Travel
Authorization
Travel Approval
Code
Customer
Request For Travel
Time to Process
Less Than 10
Minutes
Business/
CorporateTraveler
Traveler AvailabilityInitiates
ReservationCost
Low to ModerateCost
Biggest Client
Company Travel Agency
Request For Reservation
Company Profile,Traveler Profile, Author. Code
Booking aBusiness Airline
ReservationCarrying Cost
Low to ModerateCost
Company
Traveler Travel InformationDeparture and Arrival Cities,Date, Times
Travel ItineraryMail/email, carrier,times, dates, seat,special requests
Business/CorporateTraveler
Traveler Payment MethodCurrent Credit
Card w/availablecredit limit
Airline Reservat ion Ticket or E-ticket Zero Defects
Business/CorporateTraveler
Traveler Address; mailand/or email
Correct Revenue Profit MarginTravel Agent and
Carrier
BillingsElectronic
CommunicationDaily
Company AcctRec, Credit Card
Company
Occurs before process starts After process ends
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Project Definition
Project Road Map
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Project Identificat ion, Selection, And Scoping Pg 38
Project Road Map
Project Identification
Project Selection
Project Scoping
Project Definition
RecognizeOpportunities
ImplementBTS
Background Information
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Project Identificat ion, Selection, And Scoping Pg 39
Background Information
• Why work on this project?
- Resolves a difficult business problem for the last time
- This business problem has clear linkage to the goals of the business
This is the link between Project Selection and Project Definition:We need to know for whom we are doing the project, why we
are doing the project, i.e., what is important.Then we may proceed to define the project in detail.
Project Definition 1 View
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Problem Statement
• Clear and concise description of the problem
• Quantified with a metric thatincludes units
Metric
• Units of measure, significant digitsCTSs
• Why is it important to our customer:Quality, delivery, cost, other?
Defect Definition
• Describe the defect. What is it thatwe are attempting to correct? Whatmakes something good or bad?
Objective
• Where do we wish to be and when?
Project Definition – 1 View
Current/Goal/Stretch Goalxxx,xxx current DPMO (defectsper million opportunities)xx,xxx goalx,xxx stretch goal
Projected Benefits Turn the reduction in DPMO into $
for upper management
Let us discuss these one at a time.
Typical Issues With Problem Statements
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Typical Issues With Problem Statements
• Problem does not link to Voice Of Customer (no CTS link)
• Scope of problem too large/too small(refer back to criticality of proper scoping)
• Problem poorly defined or not quantifiable/vague
• Quantification based on anecdotal information
• Includes $ as the defect
- Save $250K on assembly line 1
• Stated as predetermined solution instead of as problem
- $250K on assembly line 1 by replacing old equipment
Problem Statement Drill Down
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Problem Statement Drill Down(Example 1)
Problem Statement: The Winding Operation Functional Test defect rateas based on specification AA-21 and as measured for the quarter ending
Dec. 02 is 12% (120,000 DPMO). Benchmark is 1% (10,000 DPMO).
Winding operation AA1 has too high afallout rate, i.e., too low a yield.
Over the last quarter, defects on the“Operation Functional Test” (Spec AA-21) has been 12% compared
to best-in-class of 1%.
Note that all products in this area arefrom the same family and use thesame processes.
Problem Statement Drill Down
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Problem Statement Drill Down(Example 2)
We are receiving customer complaints over late shipments.
The average XYZ order shipped during thisperiod was 6.5 days late with a standarddeviation of 4.5 days.
Our internal benchmark/allowance is 5% late.
Problem Statement: Product XYZ orders for the past 6 months (1st and2nd quarter 02), have shipped an average of 6.5 days late with a StDev of
4.5 days = 925,700 DPMO vs. standard of 50,000 DPMO.
Most of the complaints about late shipments over the last 6 months have involved Product XYZ.
Problem Statement Drill Down
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Problem Statement Drill Down(Example 3)
Customers take too long to pay us.
Of those who do not pay on time, 68% claim it is dueto a discrepancy between the work order andthe invoice.
Data that was gathered over the last 3 quartersending Sep 02 showed 55 days on the average.
Problem Statement: Over the last 3 quarters ending Sept 02, of the 45%of our XYZ customers that take more than 65 days to pay, 68% of them
delay due to a discrepancy between the work order and the invoice.
45% of our XYZ customers take more than 65 daysfrom the final billing date to pay us.
Problem Statement
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Problem StatementScope Discussion (1)
• Note that this defect is an amalgamation of 3 separate defects
• We may consider this 1 project or 3• If we cannot collect data on the defects by characteristic, we have only
1 project
- This implies a less than perfect relationship between a root causeand the measured output (defect)
- Example: If a fix is put in that entirely eliminated the surface finishdefects, but at the same time diameter defects increased significantly(for whatever reasons), the improvement to surface finish or theoverall defect reduction will not be seen
Problem Statement: The B hole in the Large Widget product family has
for the year ended Dec 02 exhibited a defect rate of 10% (100,000DPMO) based on inspection of the 3 key characteristics
(location, diameter, and surface finish).
Problem Statement
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Problem StatementScope Discussion (2)
• If the list of potential Xs for each of the 3 key outputs are essentially thesame, it may be beneficial to consider this as 1 project, e.g.,
- Quality of part material, drill, and drill grind affect all
- Speeds and feeds of tool affect all
- Rigidity and quality of machine tool and holding fixture affect all
• Even if we consider this as 1 project and therefore have only 1 projectDPMO, it is still highly advisable to collect defect data by characteristic
• Note also the use of the word “defect”. We are not trying to reduce scrap,
we are trying to reduce scrap AND rework (may be a hidden factory)
Problem Statement: The B hole in the Large Widget product family has
for the year ended Dec 02 exhibited a defect rate of 10% (100,000 DPMO)based on inspection of 3 key characteristics
(location, diameter, and surface finish).
Project Metrics
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Project Metrics
• Include Units of Measure
• Indicate where collected
• MUST BE DIRECTLY RELATED TO THE PROJECT DEFECT
• The measurement system capability will be verified as part of the project
• Recall, our process outputs are our customers inputs
• Ask the customer to provide an “operational definition” for their metrics - A common understanding of when and how metrics are measured is
often needed to eliminate ambiguities
- Example: Delivery of product to customers
• We measure when the product leaves shipping• Customer measures
- When it arrives on their dock or
- They may not measure delivery until product is in their inventory
The CTSs And The Defect Definitions
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The CTSs And The Defect Definitions
CTS
• The Problem Definition needs to include the CTSs that you areaddressing (providing a CT Tree or matrix as an attached reference isgenerally of value)
Defect Definition
• The project needs to have its Defect Definition CLEARLY established- It must be aligned to the CTSs
- It must be CONCISE
- It must clearly establish what makes the result good or bad, asdefined by the customer
-It is what will define our DPMO
• DMAIC is a FIND-and-FIX approach- If you do not have defects (DPMO), you cannot reduce them
• If you do not have a Defect Definition, you don‟t have defects
Project Objective
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Project Objective
• End goal or target
• Perfectly aligned with problem statement
• Same units as problem statement
• Timeframe or estimated completion date
Example Project Objective
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Example Project Objective
• On a previous slide an example Problem Statement was:
- Over the last 3 quarters ending Sept 02, of the 45% of our XYZcustomers that take more than 65 days to pay, 68% of them delay dueto a discrepancy between the work order and the invoice
• The appropriate Project Objective would be:
- Of the 45% of our XYZ customers that take more than 65 days to pay,our objective is to reduce the number of delays due to a discrepancybetween the work order and the invoice to pay from 68% to 10% byFebruary 2003
Projected Benefits
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Projected Benefits
• This is where the language of defects is turned into the language
of Quality, Hard Savings, Revenue Generation, etc.• Include all potential savings in an abbreviated form
- Note which are hard and which are soft
- Indicate if it is an early estimate or a firm number
• Savings are generally based on the remainder of the calendar year or 12months net savings
• Have detailed backup to support numbers
Project Definition
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Project Identificat ion, Selection, And Scoping Pg 52
Problem Statement
Assembly alignment defects on line 1 onall products have been averaging 121,000DPMO for the last 4 months. Best inclass benchmark is 20,000 DPMO
Metric
Alignment measured in inches/inch
CTSsCTQ = quality defectsCTC = Cost of rework/scrap
Defect Definition
Alignment of assembly not to spec per Blueprint AA-23
Objective
Reduce assembly alignment defects online 1 for all products from an average of 121,000 DPMO to 36,000 DPMO, areduction of 70%, by July 1, 2000
Project DefinitionEuropean Example
Current/Goal/Stretch Goal
121,000 current DPMO36,000 goal by July 2000
9,000 stretch goal by Dec. 2000
Projected Benefits
Material Savings: Reducing defectsfrom 121,000 to 36,000 DPMO willsave £306,000 annuallyOvertime Savings: £8,160savings annuallyTotal Savings: £314,160 Approved by Finance
Objectives Review
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Project Identificat ion, Selection, And Scoping Pg 53
Objectives Review
The participant should be able to:
• Explain how projects are identified, selected, scoped, and defined
• Use Performance to Plan method or Bubble up Organic ideas toidentify projects
• Prioritize project opportunities
• Create a SIPOC
• Prepare a concise project definition including problem statement,objectives, and linkage to top-level goals
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