team chartering six sigma foundations continuous improvement training six sigma foundations...
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Team CharteringTeam CharteringTeam CharteringTeam Chartering
Six Sigma FoundationsContinuous Improvement TrainingSix Sigma FoundationsContinuous Improvement Training
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Key Learning PointsKey Learning PointsKey Learning PointsKey Learning Points
Problem Statement/ Objective Primary/ Secondary Metric Cash/ Productivity (Benefits Model)
Problem Statement/ Objective Primary/ Secondary Metric Cash/ Productivity (Benefits Model)
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Team charteringTeam chartering
The methodology of CI needs to be combined with the right people for real results
For process teams to achieve results that are meaningful, the priorities of the team members need to be aligned to the strategic goals of the project
Management needs to create a supportive environment and realign resources to priorities when needed
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Project CharterProject CharterProject CharterProject Charter A “passport” or
governing document for a project team Fixes the beginning
and the end using a metric
Basic control over resources and resource conflicts
Demonstrates the need to change and areas of focus
Ensures that people are focussed on the businesses needs-example-
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Project Charter –Project Charter –Why Do We Need It?Why Do We Need It?
Project Charter –Project Charter –Why Do We Need It?Why Do We Need It?
To guard against projects collapsing due to: Inertia Passive resistance Redefinition Lack of buy in Lack of resource Overwhelming scope
To guard against projects collapsing due to: Inertia Passive resistance Redefinition Lack of buy in Lack of resource Overwhelming scope
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Project Charter-Project Charter-Who Should Create It?Who Should Create It?
Project Charter-Project Charter-Who Should Create It?Who Should Create It?
The Champion who has passion for the goal and who will fight for it. who is skilled at delegating. who has demonstrated success at involving others in
their goals. who has substantial organizational power and
awareness.
The Champion who has passion for the goal and who will fight for it. who is skilled at delegating. who has demonstrated success at involving others in
their goals. who has substantial organizational power and
awareness.
NOTE: The project charter is created after the initial project identification form has been developed and this project has been selected as one to be started on by a Black Belt or Green Belt.
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Project Charter Project Charter Project Charter Project Charter
Problem Statement
Objective
- example -free six sigma site
Project Problem Statements and Project Problem Statements and ObjectivesObjectives
Project Problem Statements and Project Problem Statements and ObjectivesObjectives
The problem statement and objective The problem statement and objective should be should be S.M.A.R.T.S.M.A.R.T. SSpecific---Focuses on a particular process, pecific---Focuses on a particular process,
process characteristic or areaprocess characteristic or area MMeasurable---Can be measured to establish easurable---Can be measured to establish
justification for project and validate justification for project and validate improvementimprovement
AAttainable---Narrow scope to allow successful ttainable---Narrow scope to allow successful completion in a specified period of timecompletion in a specified period of time
RRelevant---Directly tied to business and elevant---Directly tied to business and corporate imperativescorporate imperatives
TTime Bound---Specifies a realistic period of ime Bound---Specifies a realistic period of time (usually 3-6 months)time (usually 3-6 months)
The problem statement and objective The problem statement and objective should be should be S.M.A.R.T.S.M.A.R.T. SSpecific---Focuses on a particular process, pecific---Focuses on a particular process,
process characteristic or areaprocess characteristic or area MMeasurable---Can be measured to establish easurable---Can be measured to establish
justification for project and validate justification for project and validate improvementimprovement
AAttainable---Narrow scope to allow successful ttainable---Narrow scope to allow successful completion in a specified period of timecompletion in a specified period of time
RRelevant---Directly tied to business and elevant---Directly tied to business and corporate imperativescorporate imperatives
TTime Bound---Specifies a realistic period of ime Bound---Specifies a realistic period of time (usually 3-6 months)time (usually 3-6 months)
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Problem Statement (Description)Problem Statement (Description)Problem Statement (Description)Problem Statement (Description)
There are two purposes of the problem statement: To focus the team on a process deficiency To communicate the significance to others
The problem statement does NOT include any guess as to the cause of the deficiency, or what actions will be taken
There are two purposes of the problem statement: To focus the team on a process deficiency To communicate the significance to others
The problem statement does NOT include any guess as to the cause of the deficiency, or what actions will be taken
A poor problem statement
Warranty costs are too high due to product A and will be reduced by analyzing first and second level pareto charts.
A good problem statement
From Jan – Jun 20xx, the average warranty costs are 5% of sales with a range of 2% to 12%, resulting in a loss of $5M.
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Problem StatementProblem StatementProblem StatementProblem Statement
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1994 1995 1996 1997 1998
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1994 1995 1996 1997 1998
Warranty Returns
What if no data exists?
Data
Preliminary Problem Statement:During X length of time, the “Primary Metric” (the issue) was X, which resulted in a loss of $X.Specific data will be defined via data collection and analysis.
Specific data will have to be collected to justify giving the project priority.
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Problem StatementProblem StatementProblem StatementProblem Statement
050
100150200250300350400450500
1994 1995 1996 1997 1998
050
100150200250300350400450500
1994 1995 1996 1997 1998
050
100150200250300350400450
ProductA
ProductC
ProductE
Returns by Product Group # of Returns for Product A
Problem Statement After Data Collection: From 1994 to 1998, Product returns are 5% of sales with a range of 2% to 12%, resulting in a profit impact of $5M.
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A poor objective
Reduce Warranty costs by implementing individual performance measures and objectives.
A good objective
Reduce Warranty costs from 5% to 2.5% of sales by year end 20xx, which will result in a savings of $xxx.
ObjectiveObjectiveObjectiveObjective
The objective states the goal of the project. It must: Address the issue described in the problem statement Quantify the expected performance improvement Identify the expected timing
Like the problem statement, the objective does not state the cause of the deficiency or what actions will be taken
The objective states the goal of the project. It must: Address the issue described in the problem statement Quantify the expected performance improvement Identify the expected timing
Like the problem statement, the objective does not state the cause of the deficiency or what actions will be taken
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Primary MetricPrimary MetricPrimary MetricPrimary Metric
The primary metric is the yardstick that will be used to measure your success. It must: Be consistent with the problem statement and
objective Include 3 series of data, plotted as a function
of time: baseline performance (average over the past 12
months, if possible) actual performance Objective / goal
The primary metric is the yardstick that will be used to measure your success. It must: Be consistent with the problem statement and
objective Include 3 series of data, plotted as a function
of time: baseline performance (average over the past 12
months, if possible) actual performance Objective / goal
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Primary Metric - samplePrimary Metric - samplePrimary Metric - samplePrimary Metric - sample
Product Returns
0%
1%
2%
3%
4%
5%
6%
7%A
ug-9
6
Sep
-96
Oct
-96
Nov
-96
Dec
-96
Jan-
97
Feb
-97
Mar
-97
Apr
-97
May
-97
Jun-
97
Jul-
97
Aug
-97
Sep
-97
Oct
-97
Nov
-97
Dec
-97
Ret
urn
$ a
s a
pct
of
Sal
es $
BaselineActualObjective
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Secondary MetricSecondary MetricSecondary MetricSecondary Metric
The secondary metric is the conscience that will “keep you honest” Tracks potential negative consequences More than one may be required Examples: cycle time, cost, customer
satisfaction
The secondary metric is the conscience that will “keep you honest” Tracks potential negative consequences More than one may be required Examples: cycle time, cost, customer
satisfaction
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Sample Secondary MetricSample Secondary MetricSample Secondary MetricSample Secondary Metric
Pct of Orders Shipped within 24 hours
90%91%92%93%94%95%96%97%98%99%
100%A
ug-9
6
Sep
-96
Oct
-96
Nov
-96
Dec
-96
Jan-
97
Feb
-97
Mar
-97
Apr
-97
May
-97
Jun-
97
Jul-
97
Aug
-97
Sep
-97
Oct
-97
Nov
-97
Dec
-97
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Sample Secondary MetricsSample Secondary MetricsSample Secondary MetricsSample Secondary Metrics
Primary Metric: Lead Time Potential Secondary Metric: Quality, OT
Costs, Costs
Primary Metric: Quality (Defects) Potential Secondary Metric: Lead Time, OT
Costs, Costs
Primary Metric: Lead Time Potential Secondary Metric: Quality, OT
Costs, Costs
Primary Metric: Quality (Defects) Potential Secondary Metric: Lead Time, OT
Costs, Costs
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Project Charter Project Charter Project Charter Project Charter
This figure comes from the Company
Benefits model
-example-
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Cash and Productivity SavingsCash and Productivity SavingsCash and Productivity SavingsCash and Productivity Savings
Even in the preliminary stages of selecting a project, calculating the projected benefits is critical.
Savings are broken into two categories: Cash Savings: Those savings which directly goes to the
bottom line for the business (hard savings).Productivity Savings: The total measurable savings
generated from the project (hard and soft savings combined).
To help estimate project savings, use a “financial model” spreadsheet
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This Sheet represents the (Highlight one): PROJECTED ACTUAL Results of the project
Project: Project Start Date:
Champion: Project Complete Date:
Black Belt:
Controller:
[A] [B] [C] [D]=B*C [E] [F] = A+D+E+(H+I+J+K) [G] [H] [I] [J] [K]
Material Labor Labor Labor Other Total Cash / Cost Lead Time Square Cash * Other DateImprovement / Benefit ($) Hours Rate ($) Expense ($) Productivity ($) Savings ($) (Hours) Footage ($) (explain) Completed
Financial Model Cash and Financial Model Cash and Productivity Savings SheetProductivity Savings SheetFinancial Model Cash and Financial Model Cash and
Productivity Savings SheetProductivity Savings Sheet
Refer to the Excel Spreadsheet for complete details and examples on how to fill out this form.
One must be filled out for every project.
example
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Team members rolesTeam members rolesTeam members rolesTeam members roles
Contribute process expertise
Communicate change with other co-workers not on the team
Collect data
Accept and complete all assigned action items
Implement improvements
Attend and participate in all meetings
Stay motivated
Contribute process expertise
Communicate change with other co-workers not on the team
Collect data
Accept and complete all assigned action items
Implement improvements
Attend and participate in all meetings
Stay motivated
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Resources up to 20 hours of Black Belt
time 20 hours of systems
programmer $1000 Expenses 100 hours from
Accounts personnel Milestones
Q & M by day 3 A & I by day 15 C by day 20
Resources up to 20 hours of Black Belt
time 20 hours of systems
programmer $1000 Expenses 100 hours from
Accounts personnel Milestones
Q & M by day 3 A & I by day 15 C by day 20
Project Charter : ExampleProject Charter : ExampleProject Charter : ExampleProject Charter : Example Problem Statement –
From Jan to March, 20xx, 23 orders per day were invoiced, which resulted in a loss of $20,000 a year.
Objective - To increase the number of invoiced orders from 23 to 45 invoices per day for at least 10 days in succession by the end of the month, which will result in a savings of $20,000.
Benefits – The $20,000 is the cost of additional staff.
01020304050607080
1 3 5 9 11 15 17 21 23 25 29 2
Date
Invoices per day
01020304050607080
1 3 5 9 11 15 17 21 23 25 29 2
Date
Invoices per day
Baseline
Goal
Primary metric
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Resources up to 20 hours of Black Belt
time 20 hours of systems
programmer $1000 Expenses 100 hours from
Accounts personnel Milestones
D & M by day 3 A & I by day 15 C by day 20
Resources up to 20 hours of Black Belt
time 20 hours of systems
programmer $1000 Expenses 100 hours from
Accounts personnel Milestones
D & M by day 3 A & I by day 15 C by day 20
Project Charter : ExampleProject Charter : ExampleProject Charter : ExampleProject Charter : Example Problem Statement –
From Jan to March, 20xx, 23 orders per day were invoiced, which resulted in a loss of $20,000 a year.
Objective - To increase the number of invoiced orders from 23 to 45 invoices per day for at least 10 days in succession by the end of the month, which will result in a savings of $20,000.
Benefits – The $20,000 is the cost of additional staff.
Planning
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Project Charter : ExampleProject Charter : ExampleProject Charter : ExampleProject Charter : Example Budget 20XX $ Key milestones Define : Feb 01 Measure : April 02 Analyze : May 03 Improve : June 04 Control : July 05 Champion I.M. de Boss Team Members Alex Dollar : GB/GB Bernard Euro : Controller Charles Sterling: A/R David Yen : A/R
0
1
2
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6
1 3 5 9 11 15 17 21 23 25 3 3
Date
Number of A/R staff
0
1
2
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1 3 5 9 11 15 17 21 23 25 3 3
Date
Number of A/R staff
Secondary metric
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Project Charter - Leadership’s RoleProject Charter - Leadership’s RoleProject Charter - Leadership’s RoleProject Charter - Leadership’s Role
Check that your strategic goals (QMS) and local projects are linked
Check that your strategic goals (QMS) and local projects are linked
Provide Strategic Goals
Provide Strategic Goals
Check that local goals, resources and benefits are related
Check that local goals, resources and benefits are related
Appraise your managers on their ability to Champion change and to provide consistency
Appraise your managers on their ability to Champion change and to provide consistency
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Project Charter - Champion’s RoleProject Charter - Champion’s RoleProject Charter - Champion’s RoleProject Charter - Champion’s Role
Be more explicit about what you want than how to achieve it
Push, Push, Push! Review progress using Roadmap and Charter Metrics
Demand resources and results
Demonstrate passion. Put the Charter on your wall. Make time in your calendar
Enrol others. Help the team achieve buy in. Use your Elevator speech. Get a flip chart in your office.
Find out how the project is perceived.
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Team CharteringTeam CharteringTeam CharteringTeam Chartering
Six Sigma FoundationsContinuous Improvement TrainingSix Sigma FoundationsContinuous Improvement Training
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