I

POLITECNICO DI MILANO

Master of Science in Management, Economics and

Industrial Engineering

PROJECT MANAGEMENT MODEL FOR A ROBUST

APPLICATION OF LEAN SIX SIGMA

SUPERVISOR: Prof. Alessandro Brun

CO-SUPERVISOR:

Prof. Maurizio Montagna

CANDIDATES:

Masoud Sheikhhassan Student’s ID Number:

851023

Awais Sadaqat Student’s ID Number:

850143

Academic Year 2017-2018

I

ACKNOWLEGEMENT

We would first like to present our sincere gratitude to our thesis advisor Prof. Maurizio Montagna for his

continuous support, motivation, enthusiasm and immense knowledge for our thesis. We are extremely

grateful to him for his expert, sincere and valuable guidance. The door to Prof. Maurizio Montagna was

always open whenever we ran into doubt or had questions regarding our research. He consistently steered

us in the right direction whenever he thought we needed it. We would also like to acknowledge Prof.

Alessandro Brun of the Management Engineering Department as our internal advisor of this thesis, we are

greatly indebted for his valuable comments and insights for this thesis. And also extend to all those who in

one way or another who contributed in the development of this thesis.

II

ABSTRACT

With the increasing complexities of the projects and ever more pressing expectation of the stakeholders to

fulfill the projects in a more affordable, efficient and accelerated way, the need to move in a direction to

generate new and innovative procedures and tools is highlighted more than ever.

Although Lean, Six Sigma and Project management have been used individually in many projects, In future,

to better achieve the expectations of all the stakeholders and results these tools cannot be effective alone.

In this thesis we have brought together the advantages of the tools (of Lean, Six Sigma and Project

Management) by integrating them into a unified platform.

The development of platform required the introduction and investigation of the tools, type of expected

advantages and common points of all the three methodologies for better merging. The research resulted in

the development of a template that is a practical sample of the platform for managing projects. The

template developed is designed to provide facilitation for all the different project members for daily

checking and upgrading, facilitating communications, and saving time and cost of implementations to satisfy

the defined goals.

Con l'aumento delle complessità dei progetti e l'aspettativa sempre più pressante delle parti interessate di

realizzare i progetti in modo più economico, efficiente e accelerato, la necessità di muoversi in una direzione

per generare procedure e strumenti nuovi e innovativi è evidenziata più che mai.

Sebbene il Lean, il Six Sigma e il Project management siano stati usati individualmente in molti progetti, in

futuro, per raggiungere meglio le aspettative di tutti gli stakeholder e i risultati, questi strumenti non

possono essere efficaci da soli. In questa tesi abbiamo riunito i vantaggi degli strumenti (di Lean, Six Sigma

e Project Management) integrandoli in una piattaforma unificata.

Lo sviluppo della piattaforma ha richiesto l'introduzione e l'analisi degli strumenti, il tipo di vantaggi attesi

e punti comuni di tutte e tre le metodologie per una migliore fusione. La ricerca ha portato allo sviluppo di

un modello che è un esempio pratico della piattaforma per la gestione dei progetti. Il modello sviluppato è

progettato per fornire facilitazione a tutti i diversi membri del progetto per il controllo e l'aggiornamento

quotidiani, facilitare le comunicazioni e risparmiare tempo e costi di implementazione per soddisfare gli

obiettivi definiti.

III

Table of Content:

Acknowledgement …………………………………………………………………………………………………….………………………… I

Abstract …………………………………………………………………….……………………………………………….………………………… II

Table of content ………………………………………………………………………………………………………….………………………. lll

List of Tables …………………………………………………………………………………………………………….…………………………. VI

List of Figures ………………………………………………………………………………………………………….………………………….. VII

1. Introduction …………………………………………………………………………………………………….….……………………….….. 1

1.1. The necessity for integration of six sigma and project management …………….……………….……….….. 1

2. Project Management …………………………………………………………………………………………….……….……..…….…… 5

2.1. Project management History ………………………………………………………………………..……………………………. 5

2.2. Project management definition ……………………………………………..…………………….………..………………….. 7

2.3. Project Management Process …………………………………………………….………………….…………………………… 8

2.3.1. Initiating Process ……………………………………………………………………….……………….……………………… 8

2.3.2. Planning Process ……………………………………………………………………….………………….………….………… 9

2.3.3. Executing Process ………………………………………………………………………………….….……………………… 10

2.3.4. Monitoring Process ……………………………………………………………………………………....…….…………… 11

2.3.5. Closing Process ………………………………………………….…………………………………………………..…………. 12

2.4. Project Management Roles to Facilitate Six Sigma …………………………………….………….…………………... 14

2.4.1. Value of Project Management in the Implementation Process ………….………….…………….……. 14

2.4.2. Planning the Process …………………………………………………………………………………….…………..……... 15

2.4.2.1. The statement of work (SOW) …………………………………………….………..…………..….…....… 16

2.4.2.2. Project Specification ………………………………………..………………..………..……………………..…. 16

2.4.2.3. Milestone Schedules ……………………………………………………..………………………………….…... 16

2.4.2.4. Work Breakdown Structure ……………………………………………………………….……...………..... 16

2.4.2.5. Process Planning roles to support Six Sigma ………………….………………..…….………….…… 18

2.4.3. Cost Management …………………………………………………………………………………………….…..……..….. 19

2.4.3.1. Cost Estimation ………………………………………………………………………………………….…….……. 19

2.4.3.2. Budget Determination …………………………………………………………………………..……..…….…. 20

2.4.3.2.1. Building Schedule and Budget …………………………………………………….………..… 21

2.4.3.2.2. Budget planning roles to support six sigma ………………………………...…..….….. 21

2.4.3.3. Controlling Cost …………………………………………………………………………………………….…..…… 22 2.4.3.4. Project Time and Cost Management roles to support six sigma ………………..……..…..…22

2.4.4. Risk management ……………………………………………………………………………………………………….…..… 22

2.4.4.1. Risk Management Process Supports Six Sigma ………………………………………….….…….….. 23

2.4.4.1.1. Planning …………………………………………………………………………………...….….…….. 24

2.4.4.1.2. Identify ……………………………………………………………………………………….…….….... 25

2.4.4.1.3. Analyze …………………………………………………………………………………….…..………… 25

2.4.4.1.4. Response ………………………………………………………………………………….…………….. 27

2.4.4.1.5. Monitor and Control ………………………………………………………………….…….…….. 29

3. Lean Six Sigma ……………………………………………………………………………………………………………………….…………..31

IV

3.1. Six Sigma Definition …………………………………………………………………………………………….………………………. 31

3.2. Evolution of Six Sigma …………………………………………………………………………………………….…………………… 31

3.3. Six Sigma Deployment ………………………………………………………………………………….……………………………… 33

3.3.1. Six Sigma Implementation ………………………………………………………………………………...………………. 33

3.3.2. Critical Success Factors …………………………………………………………………………………………….………… 34

3.3.2.1. Top Level / Executive Engagement ………………………………………………..………………………… 34

3.3.2.2. Opportunity Identification ………………………………………………………………………….…………… 34

3.3.2.3. Strategic Objectives and Plan …………………………………………………………………………….……. 34

3.3.2.4. Communication of Strategy / Effective Communication ………………………………….………. 34

3.3.2.5. Metrics Development ………………………………………………………………………………….………….. 35

3.3.2.5.1. Process Map Development ………………………………………………………….……………. 36

3.3.2.5.2. Project Selection …………………………………………………………………………………….…. 36

3.3.2.5.3. Coaching and Training / Deployment of Roles …………………………….…………….. 37

3.3.3. Summary ………………………………………………………………………………………………………….………………… 37

3.4. Six sigma roles and responsibilities …………………………………………………………………………….……………….. 38

3.4.1. Leadership …………………………………………………………………………………………………………..……………. 38

3.4.2. Six sigma team ……………………………………………………………………………………….………….……………… 38

3.4.3. Champion and sponsors ……………………………………………………………….…………………….…………….. 38

3.5. Lean Six Sigma ……………………………………………………………………………………….…………………….………………. 40

3.5.1. Tools of Lean and Six Sigma ……………………………………………….……………………………….…………….. 41

3.6. Six sigma methodology ………………………………………………………….………………………..…………….…………….. 45

3.6.1. IDOV process ……………………………………………………………………….………………..………….………………. 47

3.6.1.1. Tools for IDOV ……………………………………………………………………………...………………….…….. 49

3.6.2. DMADV Process …………………………………………………………………………………….…..………….………….. 49

3.6.2.1. Tools for DMADV ………………………………………………………………………….…..…….……………… 51

3.6.3. DMAIC Methodology ………………………………………………………………………………..……..……………….. 52

3.6.4. Other six sigma methodologies ……………………………………………………………………..…..……………… 53

4. The Synthesis of DMAIC Methodology and Project Management ……………………………..…………………..…… 54

4.1. Define …………………………………………………………………………………………..…………………………………..…………. 54

4.1.1. Cost of Poor Quality(COPQ) ………………………………………………………………………………..……..……….. 55

4.1.2. Voice of Customer …………………………………………………………………..…………………………………..……… 55

4.1.3. Quality Function Deployment ………………………………………………………………………………..…….…….. 56

4.1.4. Critical to Quality …………………………………………………………………………..…………………….……….…….. 57

4.1.5. SIPOC diagram ……………………………………………………………………………………………………...……….……. 58

4.1.6. Gemba …………………………………………………………………………………………………………..….…………….….. 59

4.1.7. Affinity Diagram …………………………………………………………………………………………..….……………….…. 59

4.1.8. Analytic Hierarchy Process ……………………………………………………………………………….……..……….…. 59

4.2. Measure …………………………………………………………………………………………………………………………………...…. 60

4.2.1. Key Performance Indicators ………………………………………………………………………………………………... 61

4.2.2. Operational Definition Diagrams …………………………………………………………….…………………………… 62

4.2.3. Data Collection Method ………………………………………………………………….…………………………… 63

4.2.3.1. Data Collection Plan and Stratification Concept ……………………………………………….. 63

V

4.2.3.2. Minimum Sample Sizes …………………………………………….…………….………………..…….. 63

4.2.3.2.1. Continuous Data ………………………………………………..………..…..………...….. 64

4.2.3.2.2. Attribute (Discrete) Data ……………………………………..………………..………… 64

4.2.3.3. Sampling Frequency …………………………………………………..………………………… 64

4.2.3.4. Data Stratification ……………………………….……………………..………………………… 64

4.2.4. Measurement System Analysis ………………………………………………………..…………………………. 65

4.2.5. Process Capability …………………………………………………………………………………..………………….. 65

4.2.5.1. Sigma Calculation ……………………………………………………………………..………… 66

4.2.5.2. Cp and Pp k Indexes ……………………………………………..…………………………….. 66

4.3. Analyze …………………………………………………………………………………………………………………..…………………… 68

4.3.1. Process Mapping and Value Stream Mapping …………………………………………………………..………… 69

4.3.2. Spaghetti Diagrams …………………………………………………………………………………………………..……….. 70

4.3.3. Brainstorming and Five Whys ……………………………………………………………………………………..……… 70

4.3.4. Fishbone (Cause and Effect) Diagrams ………………………..……………………………………………………… 70

4.3.5. Failure Mode and Effect Analysis …………………………………………..…………………………………………… 70

4.3.6. Graphical Tools ………………………………………………………………………………..…………………………………. 71

4.3.7. ANOVA and Regression ……………………………………………………………………………..……………………….. 71

4.3.8. Design of Experiment …………………………………………………………………………………………..…………….. 71

4.4. Improve ……………………………..……………………………………………………………………….………………………………. 73

4.4.1. Visual Management ………………..…………………………………………………………………………………………….. 74

4.5. Control …………………………………………………..………………………………………………….………………………………... 76

4.5.1 .Project Report …………………………………………..…………………………………………………………………………… 77

4.6 .Tools usage percentage ……………………………………………..………………………………………………………………… 80

5. The Robust Hybrid template …………………………………………………………..………………………………………………………. 81

5.1. A Dashboard for Top Managers ……………………………………………………..…………………………….………………. 81

5.2. Project Charter ………………………………………………………………………………………..…………………………………… 84

5.3. Project Plan ……………………..…………………………………………………………………………………………………………… 91

5.4. Status Plan …………………………………………………………..………………………………………………..…………………….. 92

5.5. Close Out ………………………………………………………………………..…………………………………………………..……….. 93

5.6. Search ……………………………………………………………………………………..………………………………………..…………. 94

5.7. Project selection and project report ……………………..…………………………………………………………..…………. 95

5.8. Financial Reporting System ……………………………………………..……………………………………………………………. 96

5.9. Conclusion ………………………………………………………………………………..………………………………………………….. 98

5.10. Future Development of lean Six Sigma ……………………………………………..………………………………………… 99

Bibliography …………………………………………………………………………………………….…………………..……………….…………… 100

VI

List of Tables:

Chapter Two

Table 2.1. The project management and Lean Six Sigma life cycles linkage ………………………..……….….……… 13

Chapter Three

Table 3.1. Developments that lead to the current six sigma methodology ……………………..……………………… 32

Table 3.2. Comparison of Methodology Strengths …………………………………………………….….…………..…………… 42

VII

List of Figures:

Chapter One

Figure 1.1. Three Level of Application of Project Management within Six Sigma ……………..…………………..... 3

Chapter Two

Figure 2.1. Project Management Process ……………………………………………………….………….…………….…………..… 8

Figure 2.2. The Implementation Process of Project Management ……………………………………………..…………… 15

Figure 2.3. The Work Breakdown Structure levels ……………………………………………………..……………..…………… 17

Figure 2.4.Process of developing a work breakdown structure …………………………………………..…………..…….. 18

Figure 2.5. Cost Management Steps ……………………………………………………………………………………………...……... 19

Figure 2.6.The Schedule and Budget sequences ……………………………………………………….………………..…………. 21

Figure 2.7.The risk management sequences ……………………………………………………………………….……..…………. 23

Figure 2.8. The Risk Management Process ……………………………………………………………………………..…….………. 24

Figure 2.9. The Strategies for Dealing with Positive Risks and Negative risks …………………………..………….… 27

Chapter Three

Figure 3.1. Metrics Deployment …………………………………………………………………………………………………….………. 35

Figure 3.2. Measure Types …………………………………………………………………………………………………………….………. 36

Figure 3.3. Six Sigma Belts …………………………………………..………………………………………………………………….…….. 39

Figure 3.4. Common Tools for both Six Sigma and Lean ……..…………………………………………….…………………… 43

Figure 3.5. DMAIC versus DMADV ……………………………………………..…………………………………………………..……… 46

Figure 3.6. Overview of key steps In IDOV process …………………………..……………………………………………..…….. 47

Figure 3.7. Overview of the tools in IDOV process …………………………………..……………………………..……………… 49

Figure 3.8. Overview of key steps In DMADV process ……………………………………..………………………..…………… 50

Figure 3.9. Overview of the tools in DMADV process ……………………………………..…………..…………………………. 51

Figure 3.10. Big Picture of DMAIC Methodology …………………………………………………………..………..……………… 52

Chapter Four

Figure 4.1. Tools for Define Phase ……………………..……………………………………………………..………………..………… 54

Figure 4.2. The flow through Define Phase ……………….……………………………………….………………………..………… 55

Figure 4.3. House of Quality …………………………………………….………………….…………………………….……..…..……… 57

Figure 4.4. The Critical to Quality Tree …………………………………….……………………………………….……………….….. 58

Figure 4.5. SICOP Flow Diagram for Process Improvement ………………………………….…………………..………….… 58

Figure 4.6. Tools for Measure Phase …………………………………………………………………….…………….………….……... 60

Figure 4.7. The Flow through Measure Phase …………………………………………….……………………………..………….. 61

VIII

Figure 4.8. The KPIs builds upon CTQs …………………………………………………………………………………….…………….. 61

Figure 4.9. Process Diagram ……………………………………………………………………………………………………..……..……. 62

Figure 4.10. Process Capability Route Maps ………………………………………………………………………..……………..…. 65

Figure 4.11. The Approach to Collect and Analyze the Data Depends on Type of Data ……………….…………. 67

Figure 4.12. Tools for Analyze Phase ……………………………………………………………………………..……….…………….. 68

Figure 4.13. The Flow through analyze Phase ……………………………………………………………………….………………. 69

Figure 4.14. The Steps for Design of Experiment ……………………………………………………..………….….……………. 72

Figure 4.15. The Flow through Improve Phase ………………………………………………………………………….…………… 73

Figure 4.16. Tools for Improve Phase ……………………………………………………………………..………………….…………. 74

Figure 4.17.The Visual Management Benefits …………………………………………………………………………….…………. 75

Figure 4.18. The flow through Control Phase …………………………………………………………..…………………….……… 76

Figure 4.19. Tools for Control Phase ……………………………………………………………………………………………………… 77

Figure 4.20. The Project Report Components ………………………………………………………………………………….……. 78

Figure 4.21. The most common Tools Usage on Projects ……………………………………………………………….……… 79

Figure 4.22. The usage Percentage of Tools by Considering 3000 Projects ………………………………….………… 80

Chapter Five

Figure 5.1. Project management and DMAIC Dashboard for top manager …………………………………..……….. 81

Figure 5.2. Systematic Evaluation Updating for Project and Daily Check all Project by top Manager …………….. 82

Figure 5.3. The E-tracker menu bar and functional ……………………………………………………………………..………… 83

Figure 5.4. The statement of extended improvement (project charter) ………………………………………..………. 84

Figure 5.5. The Project Plan …………………………………………………………………………………………………….……..……… 91

Figure 5.6. The Status Plan ………………………………………………………………………………………………………..………….. 92

Figure 5.7. Close Out …………………………………………………………………………………………………………….….…………… 93

Figure 5.8. Searching method (Note-based, Web-based) …………………..…………………………………….….……….. 94

Figure 5.9. Project selection, and project report ……………………………………………………………………..……………. 95

Figure 5.10. Six Sigma Financial Reporting system …………………………………………………………………..……………. 97

Figure 5.11. Future Development of Lean Six Sigma ……………………………………………………………….………….…. 99

1

Chapter One

Introduction

1.1. The necessity for integration of six sigma and project management

Competitions is becoming fierce by every passing day and customers are demanding higher quality at lower

prices while companies expect to see a reasonable profit margin especially in times of crises. Traditionally,

companies have implemented Six Sigma as the evolution of Total Quality Management, Total Quality

Application, etc. for product development, improving manufacturing and organizational capabilities,

reducing cost, realizing new market shares etc., and after the first Six Sigma application, companies

integrated within this approach, systems that identify better VOC (Voice of the customer), that understand

organizational capabilities and manage a portfolio of projects. But to stay ahead of the pack in today’s

competitive global economy companies need to do more than just identifying the voice of customer (VOC)

taking into account organizational competencies. It requires a continuous portfolio of projects focused on

improving revenues and lowering costs.

Recently, many organizations are attempting to integrate the two methodologies i.e. Six Sigma and PMBOK

project management process to get the most out of the both.

Six Sigma and PMBOK have a lot of similarities, both the DMAIC methodology and the PMBOK focus on

creating an established plan of action, communication to stakeholders, managing resources, and timelines

throughout the project lifecycle.

Six Sigma tools basically offer a structured, defined and disciplined process for solving business problems.

The tools(Design of experiments (DOE), failure mode and effects analysis (FMEA), cause-and-effect diagram

(aka fishbone diagram, Ishikawa diagram), process flow diagram and gage repeatability and reproducibility

(R&R) studies) of Six Sigma are designed to find the root causes for the anomalies and defects present in

the processes that lower the quality of the products. Even though the Six Sigma work is done in cross-

functional teams that manage the project, the methodology can be strongly improved by integrating with

the project management tools for the management of the project itself. Project management tools and

techniques, on the other hand, focus on the processes and attributes related to the management of the

project. The phases of the PM contains an assortment of tools (Work breakdown analysis, schedule

development, risk analysis, scope definition, and status reporting and cost budgeting) throughout the

project for its management to completion.

Both of these methodologies have some degree of short comings and can complement each other in

varieties of ways based on the final objective. Tye (2005) suggests using Six Sigma to aid project

management when developing a new process or product [1]. Pyzdek (2003) discusses project management

requirements for a successful Six Sigma program execution but the discussion is focused at the program

2

level and not at the project level [2]. Stamatis (2001) also discusses project management integration for the

Design for Six Sigma (DFSS) methodology [3], [4].

Sagar, Lori, Ram, and Xuedong (2007) discusses utilizing project management principles for a successful Six

Sigma execution through comparing the PMBOK knowledge areas and DMAIC phases that how DMAIC

phases can leverage the PMBOK knowledge areas, moreover they also showed how much PMBOK is

deficient compared to the DMAIC phases (e.g. Analyze phase in PMBOK is completely deficient) which may

adversely affect the project execution and the success of the project. The study also suggests through a

cause and effect diagram that the factors causing the failure of a Six Sigma ( Project Tracking, Project Review,

Leadership, etc.) could be tackled through the PMBOK e.g. ( Project Review fault in Six Sigma can be tackled

through Project Integration Management in PMBOK) [5].

Hence, taking the process control attributes of effective project management and combining it with

problem-solving attributes of Six Sigma, will allow the organizations to create consistent, established and

predictable process and project problem-solving mechanism .i.e. Implementing Six Sigma methodology for

defining the problem adds statistical knowledge of the problem, lowering a chance of incorrect assessment

as it will be defined by the customer and scope documents. In the same way adding budgeting, scheduling

and resource management from project management can allow the management to take an informed

decision from jumping from 1 phase to another.

Lean Six Sigma (LSS) and PMBOK Guide both have a distinct project life cycle phases that follow a logical

progression from the start to end with defined deadlines. Each methodology is accompanied by a different

set of project life cycle phases based on the final objective of the approach. The integration of the objectives

of the two approaches creates a harmonized life cycle, hence presenting us a complimentary tool set

through leveraging the best of both methodologies. Our study focuses on the development of a robust

framework, which combines DMAIC phases of Six Sigma and integrates it with the Project Management

processes (Initiation, Planning, Execution, Monitoring, and Control) in order to make the whole project

management process more compliant to Quality standards of the Six Sigma.

In the below figure, we have displayed corresponding to the usage of project management tools, there are

three levels of applications:

The overall program is a level of application which has a general dimension of entire program which

manages with a Top manager. Usually, some tools like Gantt chart, WBS, and Risk Management are

exploited.

DMAIC application is included in the specific dimension for each project and the project tools are

used inside the DMAIC.

DFSS is an application in which the Impact of Project Management for DFSS is high according to the

major complexity of the project.

3

Figure 1.1. Three Level of Application of Project Management within Six Sigma

Key Words:

Lean Six Sigma: The activities that cause the customers critical to quality issue and create the longest time

delays in any process offer the greatest opportunity for improvement in cost, quality, capital and lead time.

Project management: Project management is the application of knowledge, skills, tools, and techniques to

project activities to meet project requirements. Work breakdown analysis, schedule development, risk

analysis, scope definition, status reporting and cost budgeting are common processes that project managers

use to plan, execute, control and close projects.

DMAIC Methodology: Within the Six Sigma’s approach, DMAIC assures the correct and effective execution

of the project by providing a structured method for solving problems. DMAIC resembles the Deming’s

continuous learning and process improvement model PDCA.

Overall Program

DMAIC DFSS

Absolutely High

High

PM Effectiveness:

4

Critical Success Factors for Six Sigma: It includes soft factors such as training and education, effective

communication, teamwork, culture change and also had factors such as statistical tools, techniques, and

methodologies, organizational infrastructure, project management.

Project Selection: Project selection is the most critical and easily mishandled element during project

implementation. Project selection is the process of evaluating individual projects or groups of projects, and

then choosing to implement some set of them so that the objectives of the organization will be achieved.

Projects should be linked to the right goals and impact at least one of the major stakeholders’ issues.

Project Charter: It provides a preliminary delineation of roles and responsibilities, outlines the project

objectives, identifies the main stakeholders, and defines the authority of the project manager and serves as

a reference of authority for the future of the project.

Data Collection Method: Successful data collection either automatically in the process or manually, need a

clear goal. It is influenced by minimum size (different in the Continuous data or discrete data), sampling

frequency.

Statistical thinking: The process of using wide-ranging and interacting data to understand processes,

problems, and solutions. Statistical thinking is the tendency to understand complete situational

understanding over a wide range of data where several control factors may be interacting at once to

produce and outcome.

Voice of Customer: Capturing requirement or feedback from the customer for one time or several times

because the customer’s changing requirement over time to provide them the best service or product

quality.

Gantt chart: one of the most commonly used methods for project planning and scheduling because it

simplifies the schedule by seeing the complex ideas as a picture and dividing the schedule of a big project

into different component parts, the user can understand them very easily and effectively.

Project Report: One of the important project management tools that can be exploited in the last phase of

DMAIC methodology is a formal presentation made to the champion and sponsor of the project. It consists

of some components such as lessons learned, record and data access, closure action log, keywords, and

clear storyboard.

Visual Management: It encompasses a wide range of techniques that help make all aspects of a workplace

and the processes that take place within it. Some areas that can be used are: improving quality as a part of

an error, safety program to show the accident situation, visual Kansans, and improving housekeeping as a

part of five S program.

5

Chapter Two

2. Project Management

2.1. Project management History

The use of project management as a business process (knowing- unknowing) has been around for quite a

long time ago. It is common to see various authors to exemplify the construction of the Great Egyptian

Pyramids as early historical projects. From the analysis of the development of the literature in this field, It

could concur that the project management had its genesis in the 1950s [6].

In the early 1950s, Bechtel was the first to employ the term project manager in the international work.

These practices in the companies gave birth to the theme and concept of the individual project manager

having total responsibility throughout the project (hence requiring the need to develop the tools and the

knowledge)

In the late 1950s, the main development in the field of project management was in network techniques,

which were related to project time management (i.e. Planning and project time controlling).The two

pioneering techniques for project management CPM and PERT were developed independently in the USA

in this era. Along these two techniques, PDM was also being developed at the same time. The CPM (Critical

Path Method) network technique (also known as Activity on Branch / Arrow Diagramming) developed

around 1959 emerged to tackle “construction scheduling problem”. The CPM network primarily focused on

activities, which were represented though “arrows”. While in PERT (Project Evaluation Review Technique)

the emphasis was put on project events/ milestones instead of the project activities. It was primarily

developed to simplify the planning and scheduling of large complex projects. Another distinctive feature of

PERT was the use of probabilistic duration estimates. Another networking technique later known as PDM

(Precedence Diagramming Method) also known as “Activity-on-Node” developed by Stanford’s university

John Fondahl to counter the time-cost problem, and was accessed to be simpler than the other models [7].

In the 1960s all the three methods saw an extension in their approach to cover their short comings. During

this era cost control, resource scheduling, identification of problems and the merger of PERT/CPM into

project management were in progress [8]. The earliest extension to CPM was resource leveling. Kelly &

Walker developed RPSM (Resources Planning and Scheduling Method), while CEIR developed RAMPS

(Resource Allocation and Multi-Project Scheduling) Fondahl developed time-cost tradeoff method for his

PDM approach and IBM developed the 1401 LESS program (Least Cost Estimating and Scheduling) [12].

Professional project management bodies were also formed in this era, the two professional project

management bodies, one in Europe and the other in North America. IPMA (International Project

Management Association – formerly INTERNET) formed in 1965 was a consortium of 15 national project

management associations. North America PMI (Project Management Institute) was formed in 1969.

The next decade saw the spread of project management applications from construction, defense and

aerospace industries into other disciplines and areas. (Kerzner, 1979) states, the concept of project

6

management was spread into virtually all the industries from defense and construction companies to

advertising and local businesses [9]. Synder (1987) stated, that 1970s were the era which gave project

management two significant new directions, one of “applications” while the other of “professional growth”

[8]. Literature in the field of project management began to increase by many folds in all the industry sectors.

sectors.The influential authors in the 1970s Cleland & King (1968) and Kezner(1979) approached their

analysis of project engineering from a systems perspective which is able to cut across many organizational

disciplines – such as finance, manufacturing, marketing, etc. while still carrying out functions of

management. Kezner(1979) states that this technique has come to be called out as System Management,

Project Management or Matrix management. [9] [10]

Many of the distinctive project management techniques which were developed or refined during the 1970s appear to owe much to the rational problem-solving approaches which were characteristic of the systems concepts of the time. These include WBS (Work Breakdown Structure), OBS (Organization Breakdown Structure), responsibility assignment matrices (e.g. Linear Responsibility Charts), and "Earned value" methods [6].

Other literatures in the 1970s are concerned with the organizational structures for project management and conflict management.

Whereas the decade of the 70s saw the proliferation of individual applications of project management, and

many extensions and refinements of project management tools and techniques, the decade of the 80s was

more one of trying to integrate the emerging experience from the many different application areas into

principles and practices which were applicable to most projects in most application areas (Sometimes

referred to as "generic") .The most conspicuous of these efforts was the North American PMI's (Project

Management Institute's) development of its Project Management Body of Knowledge (PMBOK) [6].

The ESA Report added six PM "functions" to the traditional project time and cost management functions.

The addition of the management of project scope, quality, risk, human resources, communications and

contract/procurement to time and cost as significant project management "functions".

Before the 1980s, the emphasis in project management tools and techniques had tended to be in the

execution or implementation phases of projects. But that situation was changing, and in the 80s increasing

emphasis was being placed on the "front end" of projects. [6][11].This increased focus on the front end of

projects helped redress the previous imbalance in effective project management of the project lifecycle, the

extension of this concept led to the increased focus on product(versus project) life cycle costing.

During the 1980s, there was a profound increase in the number and influence of "external" factors on

projects. For example, the number and influence of stakeholders and other "interested parties" on projects

continued to increase, putting increasing pressures on project managers to find acceptable solutions to the

(often legitimately) conflicting needs and objectives of the various stakeholders and other interested

parties. This is a prominent component of what is referred to by some as project interface management,

and by others as project management integration.

Another group of external factors which became increasingly important for many projects were physical

environmental constraints, one of the most publicized of which have been "green" issues.

7

Also during the 1980s, the perception of project management as an appropriate methodology for responding to change, and as the most appropriate vehicle for initiating and achieving change, gained wide acceptance[6].

2.2. Project management definition

Project management institute:” A project is a temporary endeavor undertaken to create a unique product,

service, or result.”

Associate for project management (APM):”An endeavor in which human material and financial resources

are organized in a novel way to deliver a unique scope of work of given specification often within constrains

of cost and time to achieve beneficial chances defined by quantitative and qualitative objectives.”

H. Kerzner:”Project management is the planning, organizing, directing and controlling of company resources

for a relatively short-term objective that has been established to complete specific goals and objectives.

Furthermore, project management utilizes the system approach to management by having functional

personnel (the vertical hierarchy) assigned to a specific project (the horizontal hierarchy).”

Project Management is the art and science of working within defined constraints of scope, time, cost, and

quality. A project is an organized commitment of effort to produce a defined outcome within defined

constraints of scope, time, budget, and quality. A project manager is a person responsible for the project,

who may use project management to deliver it.

8

2.3. Project Management Process

Each product has identifiable life cycle and specific aim and the characteristics of which are different

concerning the size and complexity level of the project. Project management processes are grouped into

five categories known as Project Management Process Groups (or Process Groups):

Figure 2.1. Project Management Process

2.3.1. Initiating Process

Initiating process does not involve starting work on creating any of the products of the project.it is

concerned exclusively with clarifying the project’s objectives and what will be needed to achieve them. The

most important output from this phase is a document that answers the questions:

What is the project going to achieve?

What is the business case?

What is the timeframe involved?

Who is going to sponsor it?

Who is going to manage it?

Project Management

Process

Initiatingprocess

Planning Process

Executing Process

Monitoring Process

Closing

Process

9

The answer to these questions are provisional at this point in time and will be subject to revision when and

if the project proceeds to the next phases. This document is known as the project charter, the project

initiation document depending on the project management method being used. Eliminating this phase from

project management process maybe leads to the misunderstanding that could cause serious problem when

the project move into the planning phase and various people involved to realizing that their expectations

are different.

2.3.2. Planning Process

Although majority people think that planning step have to complete before starting the executing step, it

could be continue and improve almost till the end of the project. Investing lots of time in planning is a big

mistake because not only it is time consuming but also it leads to false impression on members. The main

purpose of this phase is to plan time, cost, and resources adequately to estimate the work needed and to

effectively manage risk. This phase after proving some executing summary proceed as follow:

Developing the scope statement which is say what the project exactly is, people who need to

communicate with them for gain approve or sign off project, what is the end- user requirement

and final goals for the project.

Time frame management plan which provide the feasible delivery dates for each phases and also

the final date for the project, the probability constrains and milestone.

Cost management plan which is concern with details about the estimate cost of the project, report

and control the project budget by using earned value management technique to compare the

forecast expenditure cost with actual costs of the project.

Quality plan defined the quality standards the project have to meet, and explain how to manage

the compliance of deliverables. The cost of the projects goes up if in this part due to the poor

quality, reworking or customer complain have received.

Human resource plan define who are comfortable for the project in terms of expertise and skill.

Furthermore different approaches to organize the project resources has discussed.

Management of change define who could request for change and has authority for approve these

changes.

Communication plan related to the working relationships management in the projects.

Risk plan describe how to identify, assess, and manage risk. Moreover, it consider a RPN number

for each risk, which will be documented in risk break down structure (RBS).

Supplier management plan identified the products, services and resources that need to be

acquired or purchased from outside of the project team.

10

By starting the project some changes are likely to happen for instance the priority changes, promised

resources, and new factors rising up. So much that, if the planning process not be design sufficiently flexible,

then the project will fail.

Planning process can be defined according to the PMBOK as follow:

‘A formal approved document used to guide both project execution and project control. The primary uses

of the project plan are to document planning assumptions and decisions, facilitate communication among

stakeholder, and document approved scope, cost, and schedule baselines. A project plan may be

summarized or detailed.”

The PRINCE 2 also define the process plan as follow:

‘The project plan is a statement of how and when a project’s objectives are to be achieved, by showing the

major products, milestones, activities and resources required on the project.”

Another issues is the too little or too much planning process which will arise some problems in terms of

insufficient information ,invalid estimation in time and cost and team member, and generally conduct

project in the wring approaches for too little planning. Problematic issues in the reals of too much planning

could be slow down the project, and find out an unrealistic plan by project member due to the unfounded

assumptions. Moreover, when new people enter the project, at the beginning they feel uncomfortable with

the evolutionary approach to the planning process. To solve this problem there is a process is known as

“rolling wave planning” in which allows to plan the project in a series of waves. It is mean that every time

greater definition and detail has received and be able to elaborate on those further into the near future as

details become more clearly known. This is significant for those projects with high uncertainty where the

goals are clear at the beginning of the project but the final deliverables may change somewhat as the project

progresses.

2.3.3. Executing Process

The executing step is where to produce deliverables of some sort according to the project plan. It can be

considered as two processes: the executing phase, and the monitoring phase. This phase also can name

“executing and controlling” because they are strongly entwined, due to the cyclical process rather than just

blind implementation. All planning and executing and monitoring processes are interdependent. Executing

encompass of the process used to complete the work defined in the project plan to accomplish the project’s

requirements. Execution process involves coordinating people and resources, as well as integrating and

11

performing the activities of the project in accordance with the project plan. The main output of project

execution is the project deliverables and producing these will be the responsibility of the project team who

will be working to the project plan. Several actions should be done during this phase like all activities have

to align with the project objectives, managing executing team member and all involved resources, collecting

and monitoring performance data for reports and forecasts, determination of risk probability and set

managing approaches, determination communication channels, and collecting and documenting lessons

learned.

Even the precise planned projects change can be done as it process. These will results from both external

and internal influences, some source of changes could be cluster as follow:

Organizational: it derives from high level of business decision for instance change in business

scope.

Environmental: it derives from legislation and governmental policy changing.

Technical: new technologies could bring better solution, less expensive, and more effective.

End-user: feedback which has been gained during testing and review of products leads to better

understanding the customer’s requirements.

Acquiring the project team is often complicated because it is needed to confirming appropriate human

resource to complete the project assignments. Team builder need to tracking team member performance,

providing feedback, resolving issues, and managing change to optimize project performance. Managing

people is one of the complex area of the project due to the arising unexpected conflict between members

which can be lead to leave the project before completing. Any person associated to the project should be

able to raise any concern they have at any time the concern may involve a perceived problem of a suggestion

for improvement to some area of work. These issues should be reviewed at regular meeting, where project

manager should assess the change in terms of its effect on timescales, cost, benefit, quality, and risk. After

that, the project manager determine if the propose change is significant enough or not.

Another significant aspect in executing process phase is quality assurance which is related making sure that

the quality objective are met. This process also concern with continues process improvement for decreasing

waste and eliminate non value activities.

2.3.4. Monitoring Process

After work is done according to the project plan, it is time for wok monitoring and comparing the executing

actions with the project plan to find any probability different, then fulfilling the correction actions to change

the plan or the way in which the plan is being executed. By considering what is being learned from the

execution plan and re-plan on the basis of this new information, in order to prevent future plan from

becoming too detached from the plan. By make comparison between actual measured results and plan,

12

project manager could understanding where correction actions are necessary to keep the project align with

budget and scheduled plan?

In the case of significantly process deviation, it is necessary to carry out the risk assessment to determine

the underlying causes and possibility correction actions.

Another fundamental principle here is reporting mechanisms which is critical and time sensitive, because

the appropriate action just being to take if the deviation reporting happen on the correct time. Project team

members are usually expected to maintain up-to-date timesheets and records the activities they are

involved with. Another key success factor is quality of this performance data, many projects face to problem

because reported process does not match to what is actually happening.

Next point is that depending on which types of project has selected, complexity, level of management, and

size; control framework is changed. Best control system is the simplest one and as it get complex leads to

more cost and higher error probability.

The last point in this phase is project change control process, which is related to the reviewing all change

requests, approving changes, managing changes, document changes, and project plan. Even precise planned

projects will need to be change throughout its life cycle. This area of project consider also as an important

part because cost of implementing change goes up as the project progresses.so much that the essential

change should be done as soon as possible to reduce cost of executing. The next step is a process to control

potential changes and their effect on the project. This process named change control which ensure that

proposed changes are interpreted in terms of their potential effect on project timescales, cost, benefits,

quality, and personnel.

2.3.5. Closing Process

This phase includes administrative closure which is the termination of the activities of the project team, the

completion of all project documentation, and a formal sign-off of any contracts. When a project is closed:

All of the project deliverables are formally transferred to others and support functions start.

All the lesson learned from the project are documented and archived.

Any contracts established by the project are formally closed.

In this phase the project manager review all information from the previews phases to ensure that all project

work is complete before considering the project closed.

Here are some key activities for closing phase:

Obtaining acceptance by the customer which could close the contract.

Releasing people and resources.

13

Reporting on the team performance and lessons learned.

Updating or finalizing documents, project records, and results.

Finalizing procurement.

Performing quality assurance.

Storing or archiving information.[13]

The figure below reveals project management life cycle which are assigned to DMAIC phases, in the

following chapter the complete explanations about six sigma methodologies (particularly DMAIC) have

found.

PMBOK Project Life Cycle Lean Six Sigma Project Life Cycle Phases

Define Measure Analyze Improve Control

Initiating ✔

Planning ✔ ✔

Executing ✔ ✔ ✔

Monitoring ✔ ✔ ✔ ✔ ✔

Control ✔ ✔ ✔ ✔ ✔

Table 2.1. The project management and Lean Six Sigma life cycles linkage

14

2.4. Project Management Roles to Facilitate Six Sigma

Project management is referred to as the application of knowledge, skills, tools and techniques in order

satisfy or exceed the project stakeholder’s needs. This includes balancing of competing demands for

stakeholders, such as:

1. Scope, cost, time, quality and other project domains 2. Stakeholder , customers matrix – with diverse needs 3. Known and unknown requirements of the project stakeholders

This part addresses Project management, how it can be used in Six Sigma initiatives with in organization.

Project Management and Six Sigma .The basic aim of applying project management principles is to ensure

the success of the implementation process of the Six Sigma by following the generic four phases of the

project life cycle[14] .

2.4.1. Value of Project Management in the Implementation Process

As the implementation of Six Sigma or any other Quality initiative is a project, then according to D.H Stamatis

project management can be at least appreciated in the 2 areas.

1. Planning the process 2. Setting reliable, realistic and obtainable goals

15

Figure 2.2. The Implementation Process of Project Management

2.4.2. Planning the Process

Planning is one of the foremost important step in the project management, and possibly the only process

with the highest number of project hours dedicated to it. Planning process allows the management to plan

the project from start to end, identify all the relevant stakeholders, and perform project selection and

evaluation. It includes the project scope, defining project specifications and identifying the possible

schedule of the project.

Effective total program planning cannot be accomplished unless all of the necessary information becomes

available at project initiation. These information requirements are:

The statement of work (SOW)

The project specifications

The milestone schedule

Value of Project

Management

Planning the Process

Cost and Schedule

Management Plan

Risk Management

Plan

Define Scope,

Resources, and

Work package

(SOW, Milestone,

Gates, and WBS)

Better Estimation

and Activity

Planning

(Resource, work

duration, and cost)

Identify, analyze,

and Response to

Possible Risks

16

The work breakdown structure (WBS) if necessary for complex situation like design for six sigma.

2.4.2.1. The statement of work (SOW)

The statement of work (SOW) can be defined as a narrative description of the work to be accomplished. It

includes the objectives of the project, a brief description of the work, the funding constraint if one exists,

and the specifications and schedule. The schedule is a “gross” schedule and includes below items:

Start date

End date

Major milestones

Written reports (data items)

Milestone Schedules

2.4.2.2. Project Specification

A specification list is separately identified or called out as part of the statement of work. Specifications are

used for man-hour, equipment, and material estimates. Small changes in a specification can cause large cost

overruns.

2.4.2.3. Milestone Schedules

Project milestone schedules contains some information like Project start date, Project end date, Data items

(deliverables or reports), and other major milestones.

2.4.2.4. Work Breakdown Structure

The first major step in the planning process after project requirements definition is the development of the

work breakdown structure (WBS). Work breakdown structure is a product-oriented family tree subdivision

of the hardware, services, and data required to produce the end product. The WBS is structured in

accordance with the way the work will be performed and reflects the way in which project costs and data

will be summarized and eventually reported. Preparation of the WBS also considers other areas that require

structured data, such as scheduling, configuration management, contract funding, and technical

performance parameters. Although a variety of work breakdown structures exist, the most common is the

six-level indented structure shown below:

17

Level Description

Managerial Levels 1 Total program

2 Project

3 Task

Technical Levels 4 Subtask

5 Work package

6 Level of effort

Figure 2.3. The Work Breakdown Structure levels

The first level describes the total program and is composed of a set of projects. The summation of the

activities and costs associated with each project must equal the total program. Each project, however, can

be broken down into tasks, where the summation of all tasks equals the summation of all projects. The

reason for this subdivision of effort is simply ease of control. The upper three levels of the WBS are normally

specified by the customer (if part of an RFP/RFQ) as the summary levels for reporting purposes. The lower

levels are generated by the contractor for in-house control. Each level serves a vital purpose: Level one is

generally used for the authorization and release of all work, budgets are prepared at level two, and

schedules are prepared at level three.

18

Figure 2.4.Process of developing a work breakdown structure

2.4.2.5. Process Planning roles to support Six Sigma

Properly communicating on a project is a critical success factor for managing the expectations of the sponsor

and the stakeholders. If these people are not kept well informed of the project progress there is a much

greater chance that you will face problems due to differing expectations and surprises. In fact, in many cases

where conflicts arise, it is not because of an actual problem, but because the person was surprised.

Management support and involvement greatly increase a project’s chances for success. When top

leadership puts its full support behind a Six Sigma project, it typically encounters much less resistance. The

tools of planning from the project management, helps to better define the scope of the project and the at

the same time uses its visual management tools to properly communicate the projects objectives,

milestones and reviews with all the major stakeholder of the project in order to create consistency and a

strong senior management support. By properly defining the project specifications and determining the

required level of resources (Human resources, time, etc.) and timing of different work packages defined

through the WBS allows the management of the possible bottlenecks in future and benefits realized in

future. A project with easily-understood financial benefits helps focus the attention of both its team

members and the organization’s leadership.

19

2.4.3. Cost Management

Figure 2.5. Cost Management Steps

Project underestimation of resources and costs is one of the most common contributors to project failure.

As such, project managers should be knowledgeable of and consider the various industry techniques and

tools in the definition and execution of project cost estimation. As defined by the Project Management Body

of Knowledge (PMBOK), cost estimation is the iterative process of developing an approximation of the

monetary resources needed to complete project activities. Project teams should estimate costs for all

resources that will be charged to the project. 3Project cost management includes all the processes involved

in planning, estimating, funding, budgeting and controlling cost. The process of Project cost management

are:

2.4.3.1. Cost Estimation

Developing estimated and measurement for the costs needed for a resource to complete the project tasks

and activities. Cost estimation is basically an estimation based on the information known at given point. It

is a process which helps in identification and evaluation of costing alternatives to realize a project from start

to finish. The following list includes common tools and techniques used in project cost estimation:

• Expert Judgment – use of knowledge gained from past project management experience. Expert

judgment, in conjunction with objective estimation techniques, provides valuable information

about the organizational environment and information from prior comparable projects.

• Analogous Estimating – use of the metrics from a previous, similar project as the basis of

estimation for the current project. Analogous estimating takes the actual cost of previous, similar

projects as a baseline and then adjusts for known differences (such as size, complexity, scope,

duration, etc.).

Cost Estimation Determine Budget Cost Control

20

• Parametric Estimating – use of a statistical relationship between historical data and other

variables (for example, lines of code in software development) to calculate an estimate for activity

parameters, such as scope, cost, budget, and duration. Used correctly, this technique can produce

high levels of accuracy.

• Bottom-Up Estimating – estimating all individual work packages/activities with the greatest level

of detail, summarizing higher-level estimates with the combination of the individual estimates. The

accuracy of bottom-up estimating is optimized when individual work packages/activities are defined

in detail.

• Three-Point Estimates – use of three estimates to determine a range for an activity’s cost: the

best-case estimate, the most likely estimate, and the worst-case estimate.

• Reserve Analysis – determination of contingency reserves to account for cost uncertainty.

• Project Management Estimating Software – use of project management cost estimating software

applications, computerized spreadsheets, simulation, and statistical tools. Such tools can allow for

rapid consideration of multiple cost estimate alternatives.

• Vendor Bid Analysis – determination of what the project should cost based on a review of vendor

bids/proposals. This technique may be used in conjunction with other cost estimation techniques

to ensure that cost estimates are comprehensive.

2.4.3.2. Budget Determination

Determining and collecting cost estimated and combining them to develop the overall cost and baseline.

This budget consists of all authorized budgets except the management reserves. It constitutes the funds

authorized to execute the project.

This process yields the following output.

Cost performance Baseline Authorized time phased budget used to measure, monitor and control the overall cost

performance of the project developed through summing up of all the budgets by time

period and is represented by S curve.

Project Funding Requirements

Total funding requirements and periodic funding requirements developed through cost

baseline which include projected expenditures plus liabilities.

Project document updates

Budget Updates, Revised cost estimates, Re-base lining

21

2.4.3.2. 1. Building Schedule and Budget

Figure 2.6.The Schedule and Budget sequences

2.4.3.2. 2. Budget planning roles to support six sigma

Improving the quality of the budgeting process by applying the DMAIC methodology to the Project

budgeting process. The define phase in Six Sigma can affect the scope and planning of the project

management processes, While the Improve life cycle in Six Sigma can contribute to the cost estimation

related to implementing solutions. The main aim of applying Six Sigma in the budget planning would be to

derive only the required project budget and at the same time actively manage the project budget.

By listing all the budget and non-budget related cost categories, and then writing statements related to

individual skill sets to understand how much of the time will be taken to complete the activity. Listing the

estimated dates and forming total costs per category. [15]

Estimate the work(effort

hours)

Create Work Break down

Structure WBS

Sequence te Detailed Activites

from WBS

Assign Resources

to the Schedule Activities

determine the

Duration of the Project

Estimate Project Cost

Establish Milestones and Gate Reviews

22

2.4.3.3. Controlling Cost

Managing and controlling factors that in some way may affect or change the budget. It helps to monitor the

project status and manage the cost of baseline. If a y change in budget is required it can only be done

through integrated change control process. Cost control efforts analyzes the relationship between the

physical work accomplished and the expenses done. It results in Work Performance measurements, budget

forecasts, Change request and Project Update. [16]

2.4.3.4. Project Time and Cost Management roles to support six sigma

Six sigma tools can help to prevent the expectations failures which are caused by poor estimates and

through inadequate prioritization and feature selection issues. Through strong analytical tools such as

analytical hierarchy process, conjoint analysis and concept selection scorecards that give rise to fact based

and reasonable conversations between the project team and the relevant stakeholders, incorrect

visualizations and assumptions could be avoided.

Proper Use of the Six Sigma tools and methodologies can go as far as to reduce to the occurrence of political

decisions about schedules and budgets that commit project teams to run proverbial “three minute mile”

i.e. setting up nonfactual and unreal goals without any statistical analysis. [17][18]

2.4.4. Risk management

Before to elaborate what is the functionality of risk management’s steps, it is urgent to mention this part is

used for general program of six sigma and complex projects.

Risk is a measure of the probability and consequence of not achieving a defined project goal. Probability of

occurrence and the consequence of occurrence are two primary components for a given event that are

tough to measure them directly.

For projects with a time duration of less than one year, the environment is known and stable but for project

higher than one year or more it is necessary to consider technology forecasting because by considering rapid

change of technology improvement it is tough for project managements to define and plan the scope of the

project over a year or so in length. Some causes will contribute to uncertainty in forecasting technology and

the associated design needed to meet technical performance requirements, some items are listed as follow:

the project not consider enough budget for the desired level of technical performance, Starting a project

before consider adequate requirements and resources, Having an overall development process (or key parts

of that process) that favors one or more variables over others like technical performance over cost and

schedule, starting a design that has face to some limitations in achievable technological performance, and

the last item is confirming the design decision before consider the role of important items such as cost or

schedule or risk. These items will contribute to inability of project management to accurately forecast

technology. So much that the related design face to technical risk and can also lead to cost and/or schedule

risk.

23

Risk management defines as some activity that deals with the risk. A good risk management characterize as

proactive instead of reactive and positive instead of negative, and just aims to the project success. Risk

management should be closely coupled with key project processes, because it is not consider as a separate

project. It is important that a risk management strategy be established early in a project and that risk be

continually addressed throughout the project life cycle.

Figure 2.7.The risk management sequences

2.4.4.1. Risk Management Process Supports Six Sigma

Risk management includes several related actions, including risk: planning, identification, analysis in both

quantitative and qualitative way, response (handling), and monitoring and control [19]. Risk Management

starts early in the life of a project. It starts during project planning and is continuously executed throughout

the life of the project. Risk management is not standalone, but is integrated with many other project

management processes.

Create Risk Managment

Plan

Identify all possible Risk

Analyze Important

Risks

Respond to important

project risks

Create Contigency

Plans for High Risks

Control Risk during the project and

look for new Risks

24

Figure 2.8. The Risk Management Process

2.4.4.1.1. Planning

Once identified potential risks, team needs to prioritize them to develop plans to mitigate the risks.

Prioritizing is something all practitioners of Six Sigma. Prioritization Matrix helps you in narrowing down the

activities or projects by identifying a beneficial order of getting the most important things done first. When

it comes to using a prioritization matrix, it is important to identify whether the solutions that will be provided

by the Six Sigma actions or projects are interrelated. The prioritization matrix is created when everything

cannot be done at the same time.

The first step is planning which usually performed only once, during project planning. However, if the

project experiences a significant change (e.g., scope, personnel, and schedule) then the Risk Planning

process would be re-visited concurrently with any overall project re-planning. Risk planning is repeatable

and includes the whole the project risk management. An important output of the risk planning process is

the risk management plan (RMP) which is such a roadmap that indicate the ultimate destination in the

future and proposing the corresponding approach to reach the final point. [20]

Plan

Identify

AnalyzeResponse

Monitorand

Control

25

2.4.4.1.2. Identify

In the second step the main focusing is on identifying those potential risks that pose opportunities or threats

to the project. Risk identification determines which risks might affect the project and identifies some of

their characteristics. For instance risk identification in production includes concerns over packaging,

manufacturing, lead times, and material availability. Support risks include maintainability, operability, and

trainability concerns. For risk assessments it takes some time to evaluate and determining the root and

causes of the risk. The objective sources for risk assessment are varied like recorded experience from past

projects and the current project as it proceeds, Interviews and lessons learned. Risk identification is

executed continuously during a project’s life; it is first performed during Project Planning to identify an initial

set of project risks. This activity results in the first version of the project’s Risk Register, which shows all

identified risks and other related information. It is executed periodically, as scheduled in the Risk

Management Plan, to identify new risks that may have surfaced or become apparent as project conditions

have changed. Risks can also be identified according to life-cycle phases, in the early life-cycle phases, the

total project risk is high in part because of the lack of information, and because risk response plans have yet

to be developed and implemented. In the later life-cycle phases, financial risk is generally substantial both

because of investments made (such as cost) and because of foreclosed options (opportunity cost). Effective

risk identification is heavily influenced by the experience of project team members and others who

participate in risk identification activities.

2.4.4.1.3. Analyze

The third step related to the risk Analysis, shown in this process flow as the two distinct steps of Qualitative

and then Quantitative Risk Analysis, prioritizes risks for further analysis and risk response planning. It is

through this analysis that the project team identifies the most significant risks and targets those risks

requiring immediate or near-term attention.

Qualitative risk analysis supplements information assembled during risk identification and adds new

information for each risk about the probability (typically using a High/Medium/Low scale or possibly low,

medium low, medium, medium high, and high) of the risk occurring which can be define as follow:

High risk: Substantial impact on cost, technical performance, or schedule. Substantial action required to alleviate issue. High-priority management attention is required.

Medium risk: Some impact on cost, technical performance, or schedule. Special action may be required to alleviate issue. Additional management attention may be needed.

Low risk: Minimal impact on cost, technical performance, or schedule. Normal management

oversight is sufficient.

26

Risk impact be able to define as well as the risk probability (High/Medium/Low or use other scales). After

dedication Probability and impact for each identified risk and the rating be obtained, it is time for to set the

relative priority for each risk. This priority is used to focus attention on most significant risks. Qualitative

Risk Analysis is performed periodically during a project’s life, and is explicitly executed as the list of identified

risks change and as project conditions change.

Quantitative Risk Analysis is an in-depth investigation of significant risks that were prioritized during

Qualitative Risk Analysis – not all risks merit this level of examination. Quantitative Risk Analysis assesses a

range of project outcomes based upon risks, and will almost always make use of advanced analysis,

modeling and simulation techniques. Quantitative Risk Analysis is proper to numerical description of risks,

providing meaningful figures (e.g., probability of achieving project cost and schedule) under a variety of

conditions and assumptions. As in Qualitative Risk Analysis, this process step gives a prioritized list of

project risks – this list is a key consideration in planning risk responses. The Risk Management Plan should

explicitly decide, based upon several factors, whether quantitative risk analysis is appropriate for your

project. On smaller projects or those projects with few significant risks, quantitative risk analysis may not

provide any additional insights beyond the information generated during qualitative risk

analysis. Quantitative risk analysis is an advanced skill that may be unfamiliar to the project team, and there

may be no opportunities to acquire or build this skill for your project. This project management skill may

not be present within the project or executive team - project executives and stakeholders may not

comprehend the significance of the generated analysis and as a result may not be able to use this

information in making decisions. Some examples about types of risk existence in the different organization

are:

Is the right expertized people exist in the organization? (It is means if the manager is collected all

people with different needed background).

Are the current people engaging in the right activities insight the organization?

Is the organization competence align with technologies?

Do the organization consider the complexity of the project?

Conducting a risk assessment is an opportunity to evaluate the magnitude that potential events might have

on an organization’s ability to achieve both its strategic and operational objectives. There are three Six Sigma

tools that can be used to translate the historically qualitative approach to more quantitative methods.

1. Cause-and-effect matrix helps identify critical steps in a process and the presence, or absence, of controls

that prevent, mitigate or monitor adverse events. Numerical scores determine which activities create the

greatest risk. Inputs into the process are then scored to refine the areas of potential risk.

2. Risk matrix can be used to score the enterprise’s ability to recognize sources of risk and its willingness and

abilities to manage those risks. Twelve statements regarding risk are numerically scored to identify areas

on which to focus, and opportunities to emphasize and leverage areas of strength.

27

3. Failure mode and effects analysis (FMEA) helps evaluate the risk associated with steps in a process or with

the steps in the implementation plan of any project. Potential failure modes and their potential resulting

effects are identified and scored for severity of impact to the organization. Potential causes are then

identified and scored based on frequency or likelihood of occurrence. Finally, present controls are

identified and scored based on the organization’s ability to prevent, mitigate or detect these failure modes.

The three scores are then multiplied together to create a risk priority number (RPN).

2.4.4.1.4. Response

The fourth step is Risk Response Planning which develops options and selects actions to take that will

enhance opportunities (positive risks) and reduce threats (negative risks) to the project’s objectives. Once

the RPN has been calculated, the FMEA requires that an action plan be developed and responsibilities

assigned to reduce the risk associated with the critical areas identified. Based on the RPN and the risk

tolerance established by the organization, business decisions can be made to avoid or prevent the risk,

reduce or mitigate the risk, share the risk, or accept the risk. A formal cost/benefit analysis of these

alternatives assists leadership in defining their response. Once the action plan has been completed, a

recalculation of the RPN is performed to determine if the activity now falls within the risk tolerance or if

additional actions are needed. Following figure be provided more complete details corresponding to the

eight status of the Risk Response:

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Figure 2.9. The Strategies for Dealing with Positive Risks and Negative risks

Except the accept strategy that be able to use for both negative and positive risk the three strategy for

dealing with positive risk or opportunity are enhance, exploit, and share that each of them have unique

impact on the project. They are selected by considering the critically phenomenon which indicate in the risk

analyze level of risk management. Avoid strategy uses for high probability and high impact events, transfer

strategy (such as purchasing insurance) uses for low probability and high impact events, mitigate is apples

for high probability and low impact events, accept uses for low probability and low impact events.

Enhance: This response aims to modify the “size” of the positive risk. The opportunity is enhanced by

increasing its probability and/or impact, thereby maximizing benefits realized for the project. If the

probability can be increased to 100 percent, this is effectively an exploit response.

Exploit: The aim is to ensure that the opportunity is realized. This strategy seeks to eliminate the uncertainty

associated with a particular upside risk by making the opportunity definitely happen. Exploit is an aggressive

response strategy, best reserved for those “golden opportunities” having high probability and impacts.

Risk ResponseStrategy

Opportunity

Reponse

Enhance

Share

Exploit

Accept

Risk

Response

Accept

Avoid

Transfer

Mitigation

29

Share: Allocate risk ownership of an opportunity to another party who is best able to maximize its

probability of occurrence and increase the potential benefits if it does occur. Transferring threats and

sharing opportunities are similar in that a third party is used. Those to whom threats are transferred take

on the liability and those to whom opportunities are allocated should be allowed to share in the potential

benefits.

Same as the positive response, in negative response there are three strategies which are deal with deal with

threats or risks which are as avoid, transfer, and mitigate. The fourth strategy, accept, can be used for

negative risks or threats as well as positive risks or opportunities.

Avoid: Risk can be avoided by removing the cause of the risk or executing the project in a different way

while still aiming to achieve project objectives. Not all risks can be avoided or eliminated, and for others,

this approach may be too expensive or time‐consuming. However, this should be the first strategy

considered.

Transfer: Transferring risk involves finding another party who is willing to take responsibility for its

management, and who will bear the liability of the risk should it occur. The aim is to ensure that the risk is

owned and managed by the party best able to deal with it effectively. Risk transfer usually involves

payment of a premium, and the cost‐effectiveness of this must be considered when deciding whether to

adopt a transfer strategy.

Mitigate: Risk mitigation reduces the probability and/or impact of an adverse risk event to an acceptable

threshold. Taking early action to reduce the probability and/or impact of a risk is often more effective than

trying to repair the damage after the risk has occurred. Risk mitigation may require resources or time and

thus presents a tradeoff between doing nothing versus the cost of mitigating the risk.

The last common strategy in both risk and opportunity is acceptance which is adopted when it is not possible

or practical to respond to the risk by the other strategies, or a response is not warranted by the importance

of the risk. When the project manager and the project team decide to accept a risk, they are agreeing to

address the risk if and when it occurs. A contingency plan, workaround plan and/or contingency reserve

may be developed for that eventuality.

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2.4.4.1.5. Monitor and Control

The last step which is risk Monitoring and Control should continuously performed during a project’s life, and

is the primary means of ensuring that risks are being handled properly on a project. Through Risk

Monitoring and Control activities, the project incorporates newly arising risks into the Risk Management

activities and monitors previously identified risks. This process step ensures that the project always has a

valid list of risks to be managing and that proper action is being taken for all prioritized risks. Six Sigma

consolidates multiple process control systems into a framework so process owners can constantly monitor

and report key output, input and process metrics that more accurately reflect the enterprise’s performance.

Control activities, such as policies and procedures, activity management, data integrity, and information

processing all ensure leadership’s risk responses are performed with minimal variation and reported

accurately.

Other techniques suitable for risk monitoring and control are Earned Value, Program Metrics, Schedule

Performance Monitoring, and Technical Performance Measurement. Earned Value (EV) which is used to

determine if risk response actions are achieving their forecasted results by using standard cost/schedule

data. Program metrics evaluate development process achieving its objective. Schedule Performance

Monitoring which use to assess running program success to completion and Technical Performance

Measurement (TPM) is used to assess the effect of risk response actions on values of technical performance

parameters of the current design.

A project manager can request a risk contingency budget based on a qualitative risk analysis at the beginning

of a project. However, risk identification is not something that only happens at the beginning of a project.

The project manager needs to assess risks throughout the project. Therefore, it can make sense for medium

to large projects to include time and budget for unknown risks as a part of your estimating process. This

would especially make sense for projects that have a number of high-risk events. If you do an effective job

of periodically reassessing risks, you may find new risks to manage that were not included in the original

risk contingency budget. This particular set of tool set is weak in the Six Sigma domain, and the Six Sigma

deployment can leverage heavily for successful project completion though Risk management tools of project

management.

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Chapter Three

3. Lean Six Sigma

3.1. Six Sigma Definition

Six sigma is a data driven problem solving methodology which focuses on process variation and puts an

emphasis on customer satisfaction. It is a business process that allows companies to drastically improve

their bottom line by designing and monitoring everyday business activities in ways that minimize waste and

resources while increasing customer satisfaction. Pioneered in the Motorola in the mid-1980s by Bill Smith

and known as the magic number of 3.4 defects per million opportunities, six sigma is viewed as rigorous

statistical quality control mechanism. It guides companies into making fewer mistakes in everything they

do. [21]

In the past, the definitions of Quality focused on conformance to standards by striving to create process and

services that fell within certain specification limits. The performance standards of the company was

considered correct and high if they produced quality products and services, regardless of how these quality

standards were met. For example, reworking a part several time to achieve conformity with the standard.

The concept of Six Sigma broadens the scope of Quality (for both customer and company) to include

expected standards of economic value (e.g. the cost to produce product and practical utility) [22].

3.2. Evolution of Six Sigma

The Six Sigma methodology is not a completely new and different mindset with a radical new set of tools and methodologies to tackle the company’s problems. It is more of an evolutionary development of the science of continuous improvement that combines the elements from many earlier initiatives, though some of the tools used in six sigma are new (QFD – Quality Function Deployment) , most of them date back to 50 years ( e.g. Fishbone diagram).

The thing which makes Six Sigma a powerful tool, is the combination of these elements with a rigorous disciplined approach. The Six sigma approach itself was developed in the 1980s within mass manufacturing environment in Motorola [23] in their struggle to meet their quality standards for their complex products. After its adoption by GE in the 1990s (Folaron and Morgan 2003, Thawani 2004), it became widely known and evolved from a process improvement methodology to a companywide philosophy. Initially it was a quality measurement approach based on statistical principles, which transformed into a disciplined process improvement technique.

32

Each Era contribution to Six Sigma

1798: Eli Whitney, Mass Production and Interchangeable Parts

• Need for consistency. • Identification of defects.

1924: Walter Shewhart

• Process oriented thinking. • Control charts (assignable and common cause).

1945: The Japanese Quality Movement Begins

• Statistical methods and use of statisticians. • Continuous improvement (plan-do-study-act) Methodology. • Active engagement of management and involvement of everyone. • Diagnostic and remedial journeys.

1973: The Japanese Make Their Move • Quick response to changing customer needs.

1980: Philip Crosby and Quality Is Free • Methodology to achieve companywide quality improvement. • Improve product, process and service. Strive for perfection.

1987: International Organization for Standardization

• Widespread sharing of basic elements of sound quality systems. • Organizational rally cry for improvement.

1987: Malcolm Baldrige National Quality Award

• Sharing best practices. • Strong focus on customers and results.

1987: Motorola and Six Sigma • Focus on customer needs and comparison of process Performance to those needs. • Structured methodology with discipline and proven business results.

1960-1995: Other Initiatives • Focus on customer needs and comparison of process performance to those needs. • Structured methodology with discipline and proven business results.

Table 3.1. Developments that lead to the current six sigma methodology [23]

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3.3. Six Sigma Deployment

3.3.1. Six Sigma Implementation

Six Sigma implementation strategies could vary on the basis of the organizations, based on the type of

culture, priorities and their strategic objectives. Once having decided to implement Six Sigma initiative, an

organization may select in its simplest forms the following two basic options [24]:

Implement a Six Sigma Program or Initiative

Develop an Infrastructure for Six Sigma

Whatever the way of implementing a Six Sigma project is selected, the project in itself, follows the DMAIC

methodology.

D: Define the strategic direction of the organization.

M: Set measures for the strategic objectives of the organization.

A: On a continual basis collect data on the measures set and analyze using Six Sigma tools and techniques.

I: Identify the opportunities for improvement and convert them to Six Sigma projects for improvement.

C: Set up a management control action of continuous reviews on the improvements made on Six Sigma

projects. [25]

How is Six Sigma Implemented?

To focus on successful implementation of Six Sigma in your company, what should be the starting point?

Which steps and factors should be kept in mind while the implementation or deployment process of the Six

Sigma. There are companies who stared to implement the Six Sigma initiative but were unable to act as they

couldn’t comprehend and understand how to properly deploy a Six Sigma project in there organization. A

successful implementation of Six Sigma requires a thorough understanding of company`s performance, a

strategic plan with key objectives, metrics, goals and plan that will help the executives to focus on the

organization. [26]

Based on the literature review and previous researches, the critical success factors for Six Sigma include soft

factors such as training and education, effective communication, teamwork, culture change etc. and had

factors such as statistical tools, techniques and methodologies, organizational infrastructure, project

management, etc. [27]

3.3.2. Critical Success Factors

Despite the immense popularity of this approach, there still exists a concern regarding the failure of this

approach [28]. According to the research of Gray and Anantatmula (2009) [29], 67 % of the respondents

faced failure of the Six Sigma at least once during its implementation. . In a related way, Zimmerman and

Weiss (2005) argued that less than 50 % of the survey respondents from aerospace companies were satisfied

34

with their Six Sigma programs [30]. In the context of Six Sigma project implementation, critical success

factors represent essential ingredients without which a project stands little chance of success Critical

Success Factors Road Map for successful Deployment of Six Sigma Initiatives:

3.3.2.1. Top Level / Executive Engagement

Executive engagement is one of the most critical factors for Six Sigma to succeed. The consistent support

and buy in from management are essential elements during the cultural change of implementing, lack of

commitment from leadership is the major resistance/barrier for the successful implementation of Six Sigma.

Executive engagement may include Deploying Six Sigma as a core business process; Creating accountabilities

and rewards system; Attending regular meetings to verify progress; and Commitment of time, resources,

and people.

3.3.2.2. Opportunity Identification

The first step in the deployment is the need to find the existence of opportunity with in the organization,

this should be done through the self-assessment of the organizational capabilitities.to understand the

current AS-IS situation. With the AS-IS map developed hunt and identify the various opportunities for

improvement.

3.3.2.3. Strategic Objectives and Plan

This step allows the organization to clearly identify its current strategies and growth opportunities. At the

same time it allows the executives to re-evaluate their current strategies and strategic objectives. This factor

also allows the executives to embark on possible new strategic objectives to develop the TO-BE situation of

the company.

This important step lays the foundation for the project selection methodology. For each focus group of the

process, opportunities are identified and for each opportunity, projects are then scoped and selected. This

steps provides a disciplined and structured approach that ensures that Six Sigma project is aligned to

business success factor, objectives and metrics.

3.3.2.4. Communication of Strategy / Effective Communication

Effective communications on Six Sigma play an important role in creating the Six Sigma community within

an organization.

Development of an effective communication plan, communication of the organizational strategy of the

organization in one of the main critical success factor. One of the most effective methods to communicate

the strategy of the organization is through balanced scorecard and strategy road map. This technique allows

to understand the four perspectives and helps the executives to understand better their strategy and hence

provides an effective linkage between the business process metrics and strategic (perspectives) metrics.it

helps clarify the strategic objectives of the organization and serves as an excellent communication tool to

all in the organization so that there is a common understanding and alignment within the organization.

35

3.3.2.5. Metrics Development

One of the key requirements for the proper implementation of the Six Sigma Program is the development

of the metric system. The strategy map allows us to develop metrics consistent with the strategy of the

organization. In other words, when developing metrics, organizations try to focus on what needs to be

measured to achieve the strategy.

Figure 3.1. Metrics Deployment

Metrics and measure development is one of the key and essential element in any six sigma project. As they

allow the top managers and executives to evaluate the necessary measures and select the relevant project.

Measures can generally take form of 2 types, lead and Lag measures. Lagging indicators are typically

“output” oriented, easy to measure but hard to improve or influence while leading indicators are typically

input oriented, hard to measure and easy to influence .[31]

Identify CSFs for each Containing Lag and Lead Measures

Shareholders Employees Customers

Learning and Growth

Internal Processes

36

Figure 3.2. Measure Types

3.3.2.5.1. Process Map Development

Another key element in the Six Sigma Deployment is the development of process maps based on the SIPOC

(Supplier, Input, Process, Output, and Customer). This element allows us to see the key and support

processes of the organization, which leads to the development of the metrics or measures for each of these

processes. Which then can be related with measures/metrics of the strategy map to create a concurrency

in the process and strategy objectives.

This is key pre-step before the project selection, as it allows you to statistically analyze different processes

and strategic business impacts related to it. All this information acts as an input for the project selection

matrix.

3.3.2.5.2. Project Selection

The above mechanism, is one of the most general one, which involves development of metrics and measures

through which, later, data is collected on continual basis to identify the gaps in the organization.

These kind of mechanisms involve senior management who have received trainings (Champions, Master

Black Belts) who analyses the data and develops a formal mechanism to select Six Sigma projects in line with

the company strategy. [32] Many publications revealed that project selection is the most critical and easily

mishandled element during project implementation [33].

Project selection is the process of evaluating individual projects or groups of projects, and then choosing to

implement some set of them so that the objectives of the organization will be achieved. Projects should be

linked to the right goals and impact at least one of the major stakeholders’ issues, e.g. growth acceleration,

Lag Measure Lead Measure

Measures the Goals

Predictive: Measures

Something that Leads to

the Goals

Influence able:

Something we can

Influence

37

cost reduction or cash flow improvement [34]. Good project selection is itself a process; if it is properly

carried out the potential benefits of six sigma can improve substantially [35]. Project selection is related

with the project implementation, contributes to success and not only to the efficiency of the business

processes and supports the development of the project culture in the organization.

3.3.2.5.3. Coaching and Training / Deployment of Roles

Szeto and Tsang (2005) stated that improving the quality standards requires change, and change happens

with people [36]. One of the most effective way to change people is making them understand what is

happening and why is happening, like including this important resource into the strategy of the company.

Whenever a Six Sigma project is implemented in an organization, it allows the company to set new goals

through new paradigm, thinking, tasks and behavior. All these factors introduce the need, to train certain

employees within the industry with Six Sigma skills and qualifications. This is the key element for the

sustainability of the Six Sigma programs, because this provides not just a solid infrastructure to manage and

implement the Six Sigma projects but also the fuel (the trained professionals) to keep the process going.

The real benefits from the Six Sigma methodology are reaped after continuous and successful

implementation of the SS techniques.

For this purpose SS has developed training programs like Champions, Master Black Belts, Black Belts and

Green Belts. Which identify, implement and control the Six Sigma projects.

3.3.3. Summary

The organization carefully determine how to focus and deploy its Six Sigma efforts so that they were aligned

with key business priorities and the company’s strategy. Each developed an effective Six Sigma

infrastructure of Champions, Master Black Belts, Black Belts, and Green Belts to learn, apply, and

disseminate Six Sigma methodology. This infrastructure, in turn, formed a solid foundation for the project

selection process, helping ensure that improvement would be directed toward creating the most value and

advancing the company’s objectives. Most importantly, all of these Six Sigma programs enjoyed the full

support and active involvement of the top management teams, thus demonstrating the importance to all

employees of the improvement efforts. Equally important, all of these Six Sigma programs depended for

their ultimate success on the quality and scope of the training that their people received at all levels.

Through comprehensive curricula, designed to maximize knowledge transfer, diffuse knowledge through

the organization, provide hands-on application of tools, and address such people issues as motivation and

multi-cultural understanding, these companies have developed a cadre of improvement experts who not

only generated substantial returns on the investment initially but who are in place to generate even more

value in the future.

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3.4. Six sigma roles and responsibilities

In each organization, Six Sigma is the primary enterprise strategy for process improvement. To make this strategy

a success it is necessary not only to implement Six Sigma, but also to institutionalize it as a way of doing business.

It is not enough to train a few individuals to act as champions for Six Sigma. To the contrary, such a plan virtually

guarantees failure by placing the Six Sigma activities somewhere other than the mainstream.

3.4.1. Leadership

The primary responsibility of leadership is to assure that Six Sigma goals, objectives, and progress are properly

aligned with those of the enterprise as a whole. This is done by modifying the organization in such a way that

personnel naturally pursue Six Sigma as part of their normal routine. This requires the creation of new positions

and departments, and modifying the reward, recognition, incentive, and compensation systems for other

positions.it also contains creating a team for deploying Six Sigma and accomplishing the goals of the enterprise.

3.4.2. Six sigma team

Six Sigma teams are sometimes lead by the Black Belt, but the team leader is often the Green Belt or a Six Sigma

champion who has a passion for the project. Six Sigma teams are composed of groups of individuals who bring

authority, knowledge, skills, abilities and personal attributes to the project. There is nothing particularly special

about Six Sigma teams compared with other work teams. They are people with different backgrounds and talents

pursuing a common short-term goal. Like all groups of people, there are dynamics involved that must be

understood if the mission of the team is to be accomplished.

3.4.3. Champion and sponsors

To deploy six sigma within a company, its employees must be trained using Six Sigma’s hierarchical process, which

is similar to that used in martial arts. Each belt offers different business benefits for the holder and its teams.

There are five Six Sigma Belts—White, Yellow, Green, Black and Master Black—and what is known as a

Champion.

39

Figure 3.3. Six Sigma Belts

Understands the structure and goals of LSS.

•Uses basic six sigma vocabulary terms.

•Reports process issues to Green and Black belts.

Understands basic LSS concepts.

•Participates on project teams and receivies just-in-time training.

•Reports process issues to Green belts and Black belts.

Starts and manages LSS projects

•Has LSS expertise but in less detail than Black belts.

•Providing just- in-time training to others.

Functions as a coach, mentor, teacher, and project leader for project team.

•Has advance LSS expertise.

•Can report to a Master Black belts.

Work with leader to identify gap and select projects.

•Responsible for LSS implementation and change culture.

•coachs, teachers, monitors, and lead projects.

Executive leader who drives the initiations.

•Help to select projects and remove the barriers for the team.

•Support changes and develops a LSS culture.

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3.5. Lean and Six Sigma

The concept of Lean Thinking (LT) developed from Toyota Production System (TPS) involves determining the

value of any process by distinguishing valued-added activities or steps from non-value added activities or

steps and eliminating waste so that every step adds value to the process. Lean focuses on efficiency, aiming

to produce products and services at the lowest cost and as fast as possible. The commitment to LT must

start at the top management level and should be cascaded down to various levels across the organization

to improve flow and efficiency of processes. Lean strategy brings a set of proven tools and techniques to

reduce lead times, inventories, set up times, equipment downtime, scrap, rework and other wastes of the

hidden factory.

Six Sigma was developed at Motorola by an engineer Bill Smith in the mid-1980s. Six Sigma is a business

improvement approach that seeks to find and eliminate causes of defects or mistakes in business processes

by focusing on process outputs which are critical in the eyes of customers. Six Sigma principles can be used

to shift the process average, help create robust products and processes and reduce excessive variation in

processes which lead to poor quality. The statistically based problem solving methodology of Six Sigma

delivers data to drive solutions, delivering dramatic bottom-line results.

Moreover, Lean is primarily focused on material and information between the process steps whereas Six

Sigma can be extremely useful in addressing poorly performing value adding transformations within the

process steps. Many Lean principles are fundamentally based on qualitative models developed from years

of experience. Six Sigma on the other hand can play a critical role in understanding what is really happening

inside the process steps. Each methodology proposes a set of attributes that are prerequisites for effective

implementation of the respective program: top management commitment, cultural change in organizations,

good communication down the hierarchy, new approaches to production and to servicing customers and a

higher degree of training and education of employees. The integration of two systems can achieve better

results than what either system could not achieve alone. [37]

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Lean Six Sigma: The combination of the two systems yield a methodology known as Lean Six Sigma (LSS),

which focuses on maximizing the shareholder value by achieving the fastest rate of improvement in

customer satisfaction, cost, quality, process speed and invested capital.

The fusion of the two techniques is very much necessary as Lean alone cannot bring a process under

statistical control, while sigma alone cannot improve the process speed. Lean six sigma follows the following

principle:

The activities that cause the customers critical to quality issue and create the longest time delays in any

process offer the greatest opportunity for improvement in cost, quality, capital and lead time.

This technique allows us to focus on external quality issues that affect the customer and the order in which

these improvements should be executed. This combined technique answers the following focal questions.

Which process steps should the LSS tools be applied first.

In which order these tools should be implement and to which extent.

How can we achieve biggest improvements in cost, quality and lead time.

Vince Lombarti said: It is hard to be aggressive when you don’t know who to hit.

3.5.1. Tools of Lean and Six Sigma

Both of these methodologies (Six Sigma and Lean) are focused on process stability and in forming a

continuous improvement culture. The fundamental lea strategy tools include Value Stream Mapping (VSM),

SMED, and Total Productive Maintenance (TPM), Kaizen, and TAKT time, LOAD Balancing, Poka Yoke and

Kaizen. Although many of the problem solving and identification techniques are commonly used in both

Lean and Six Sigma methodologies which may include Brainstorming, 5 WHYS, Pareto Analysis, cause and

effect diagrams, etc., Six Sigma tools are rather more focused on systematic method to find the root cause.

The DMAIC cycle in Six Sigma makes use of some advanced statistical tools like ANOVA, DOE (Design of

Experiments), Regression Analysis etc. to decrease the variability and improve the customer focused quality

issues.

The following table depicts the comparison of the strengths of the two methodologies and how these

strengths can complement each other.

42

COMPARISON OF METHODOLOGY STRENGTHS

SIX SIGMA LEAN

Visibility of the Supply Chain System X

Establishes Continuous Improvement Culture X X

Highlight Waste and Identifies Actions X

Implements Process and System Improvements X X

Systematic methodology for Problem Solving X

Variability and Quality Improvement Emphasis X

Customer centric focus X X

Table 3.2. Comparison of Methodology Strengths [38]

43

Review of tools:

A review of the both methodologies showed that there exist a commonality of certain tools. While the

remaining tools of both Six Sigma and Lean methodology compliments each other to achieve excellence in

an organization.

Figure 3.4. Common Tools for both Six Sigma and Lean. [39]

ValueValue

StreamFlow Pull Perfection

Improve Efficiency

Define Measure Analyze Improve Control Reduced Variability

-Physical Maps -Time Value -Takt Time -Cycle Time

-Level loading SMC Tools

-Single Piece Flow

-Cell Design Set- Up

Reduction -5S

-Kanban POLCA -kaizen

-SPC -Standard Work

-Mistake Proof -Visual Controls

-TPM -Brainstorming

-VSM -KPI

-Brainstorming -Pareto

-C&E -5 Whys -COPQ

-QFD -FMEA

-Chartering -Project Selection

-Cost Benefits -Communication

Skills

-Pre Control -Hypothesis Testing

- Pugh Matrixs

-MSE -Multi-variant

-DOE -Regression

-Anova

-Basic Stats Sigma Level & DPMO

Process capability Yield cals.

-Sampling Confidence Intervals Non-normal

Distribution. -Data

Transformations.

Six

Sigm

a To

ols

Le

an T

oo

ls

Co

mm

on

To

ols

Lean

an

d c

apab

le

pro

cess

es

44

The above illustration shows that, by combining the different phases of Lean and Six Sigma methodology,

the different tools complement each other by covering the short comings of the other approach.

The first phase in LSS is the Defining the Value or Scope of the Project, in this phase customer demands are

considered. Both approaches have their own defined set of tools to gather the required information. A

SIPOC flow chart is usually employed in the LSS methodology. The Second Phase involves the Measuring of

the Value streams, in this phase both methodologies gather quantitative and qualitative data to get a clear

as-is situation. The Lean tools gives the eyes to the observer through VSM and Takt time tools while the Six

Sigma tools go into statistical tools for better understanding the process flows. The next step involves

Analyzing the Flows, in this phase Six Sigma relies on analytical technologies and focuses on to find the root

cause of the process problem, while Lean at this stage focuses on eliminating waste. Six Sigma at this stage

requires FMEA, ANOVA techniques for quantitative analysis, while Lean uses load balancing, SMED and 5 S

to eliminate the flow problems. The next phase is Improving Process Pull, this is where both methodologies

converge to gather information and decide on a specific solution of defects and issues generated during the

previous phase. In this process Six Sigma generally uses DOE (Design of Experiments) while Lean uses

KAIZEN. DOE focuses on improving the quality while KAIZEN focuses on change. The last phase is the

controlling perfection, Lean usually implies Audits to sustain the gains (5S, Process redesign, TPM) while Six

Sigma implies control system (SOPs) to sustain change.

The value of any process by distinguishing valued-added activities or steps from non-value added activities

or steps and eliminating waste so that every step adds value to the process. Lean focuses on efficiency,

aiming to produce products and services at the lowest cost and as fast as possible. The commitment to LT

must start at the top management level and should be cascaded down to various levels across the

organization to improve flow and efficiency of processes. Lean strategy brings a set of proven tools and

techniques to reduce lead times, inventories, set up times, equipment downtime, scrap, rework and other

wastes of the hidden factory. Six Sigma was developed at Motorola by an engineer Bill Smith in the mid-

1980s. Six Sigma is a business improvement approach that seeks to find and eliminate causes of defects or

mistakes in business processes by focusing on process outputs which are critical in the eyes of customers.

Six Sigma principles can be used to shift the process average, help create robust products and processes and

reduce excessive variation in processes which lead to poor quality. The statistically based problem solving

methodology of Six Sigma delivers data to drive solutions, delivering dramatic bottom-line results.

Moreover, Lean is primarily focused on material and information between the process steps whereas Six

Sigma can be extremely useful in addressing poorly performing value adding transformations within the

process steps. Many Lean principles are fundamentally based on qualitative models developed from years

of experience. Six Sigma on the other hand can play a critical role in understanding what is really happening

inside the process steps. Each methodology proposes a set of attributes that are prerequisites for effective

implementation of the respective program: top management commitment, cultural change in organizations,

good communication down the hierarchy, new approaches to production and to servicing customers and a

higher degree of training and education of employees. The integration of two systems can achieve better

results than what either system could not achieve alone. [37]

45

3.6. Six sigma methodology

Every step needs some period of time to complete, the sequence of steps and the times will vary widely,

depending on the size and the complexity of the project. For instance, one of the characteristics of complex

project is multiple goals and obviously fulfilling related measurements for multiple possible improvement

which would be more time consuming even if lead to satisfied results for first try, otherwise these

measurements should be repeated one more time. Complex projects recycle through the steps multiple

times until they achieve results.

One key to accomplishing Six Sigma projects quickly is having an experienced black belt or master black belt

because they help keep a team moving and get them through other rough spots that would otherwise delay

the project for extra weeks. Some elements of each project, like the steps in a process or the customers, are

unique to the specific process and must be debated and analyzed by the project team. Other elements, like

when to apply what measures and how to set up certain types of measures, can be accomplished quickly by

someone experienced in the Six Sigma process and armed with an appropriate software tool that they know

how to use.

Not all projects achieve Six Sigma. As most Six Sigma practitioners explain, Six Sigma is a goal. The ultimate

idea is to improve the process and to reduce the variation in the process as much as possible. It is the

attitude and not a specific target that is most important.

Design for six sigma (DFSS) is set of modeling and analysis tools use to predict the probability of failure, then

the optimize the process design before lunching project by minimizing the failure and variation align with

maintaining all requisite process capacities and customer expectations. DFSS is a powerful approach to

designing products, processes and services in more reliable and capable way and in more cost effective and

simple manner for satisfied the customer’s needs. The intent of DFSS is to minimize future problems,

minimize variability, maximize satisfaction, deliver what is desired in a timely fashion and include suppliers

in the design process. The aim to present the DFSS theory along with its concept and related tools is to

eliminate or reduce both the conceptual and operational types of vulnerabilities of designed. Operational

vulnerabilities takes variability reduction and mean adjustment of the critical-to-quality (CTQs)

requirements and conceptual vulnerabilities lead to high development costs, longer time to market, lower

quality levels. [13]There are two supportive for DMADV methodology: Lean and Knowledge Management.

Therefore, combination of Lean, Six Sigma-DMADV and Knowledge Management is very powerful for

process improvement and reduction of cost of quality. [40]

There are different options for the implementation of DFSS: DMADV synonymously referred to as DFSS,

although alternatives such as IDOV are also used. DFSS uses to design a new service, product, or process

where none existed or when existing process seems to be improper and need to exchange.

46

The next methodology in six sigma that is also our main focus also is DMAIC which be able to implement as

a quality improvement procedure or as a part of lean process. DMAIC and DMADV are two of the most

widely used Six Sigma methodologies. Both these methods help make the business process more efficient

and effective. Although both methodology have some part in similar, they are not interchangeable. The first

three phases of both these methodologies are the same and the rest are totally different. DMAIC states the

applicability of the business process, whereas DMADV focuses on the customer needs as they relate to a

service or a product. With DMAIC, the Improve and Control Phases focus on spot improvements and

controlling the use of DMADV in process. In contrast, with DMADV, the Design and Verify phases deal with

redesigning the process in order to meet the customer requirements. DMAIC concentrates on improving a

business process in order to reduce or eliminate defects; DMADV develops an appropriate business process

that will meet the customers’ requirements. In the following sentences the main concentration are in

process and requirement’s tools of the three mentioned options. [41][42]

Figure 3.5. DMAIC versus DMADV. [43]

47

3.6.1. IDOV process

IDOV is well known methodology for designing products and services to meet the six sigma standards,

especially in manufacturing world. It has four phases process consists of identify, design, optimize and verify.

Figure 3.6. Overview of key steps In IDOV process

Phase 1: Identify requirements

Step 1: Draft project charter: in comparison with the DMAIC improvement, the only difference in this step

are two following facts, project duration which is usually longer an initial cost which is usually higher. The

reason why the project duration is higher is because of companies trying to designing or redesigning a

different entity completely rather than revising the current problems; and higher initial cost is concern to

the many more customer requirements to be identified and studied, since one needs to identify all

important critical-to-satisfaction (CTS) metrics to conceive and optimize better designs, in contrast to the

DMAIC case, one may only work on improving a very limited subset of the CTSs.

Step 2: Identify customer and business requirements: Through the quality function deployment (QFD) and

Kano analysis all customers and their needs have collected and then analyzed. Then the most appropriate

set of CTSs metrics are determined in order to measure and evaluate the design and one more time by using

QFD and Kano analysis, the numerical limits and targets for each CTS are established.

Phase 2: Characterize design

Step 1: Translate customer requirements (CTSs) to product/process functional requirements: Although by

considering both critical-to-satisfaction (CTS) and Customer requirements, ideas about what really leads to

customer satisfactions has found, they are not enough as the requirements for product or process design.

QFD can be used to translate customer requirements to product/process functional requirements.

Verify the design

Optimize the design

Characterize the desisn

Identify requirements

48

Step 2: Generate design alternatives: after fulfilling the new design for entity by considering function

requirements, it is time to develop design entities that will be able to deliver those functional requirements.

In some cases the existing technology or known design concept is be able to satisfy the customer’s needs.

Otherwise, new a new design concept needs to be developed which concerning the degree of deviation

from the baseline design, it could be creative design or incremental (they are the project types) design.

Step 3: Evaluate design alternatives: a various range of alternatives could be defined in this step. So much

that, they need to evaluate by using some methods like the Pugh concept selection technique, design

reviews, design vulnerability analysis (El-Haik 1996, Yang and Trewn 1999), and FMEA to select the most

appropriate concept.

Phase 3: Optimize the design:

After completing the concept design, still more adjustments have needed for design parameters which

could be determined the optimal parameter settings by help of some methods like computer simulation,

DOE modeling, Taguchi’s robust design methods, and response surface methodology. Usually this

parameter optimization phase, in product DFSS projects, will be followed by a tolerance optimization step.

If the design parameters are not controllable, which is usually the case on the DFSS product projects, we

may need to repeat phases 1 to 3 of DFSS for manufacturing process design.

Phase 4: Validate the design:

The last phase move forward the verification and validation activities.

Step 1: Pilot test and refining: in this step, the design failure mode–effect analysis (DFMEA) as well as pilot

and small-scale implementations use to test and evaluate real-life performance of products or services, then

they are prepare to transfer to the market.

Step 2: Validation and process control: In this step, the new entity will validate for confirming the design

requirements achieved and that the process controls in manufacturing and production are established in

order to ensure that critical characteristics are always produced to specification of the optimization phase.

Step 3: Full commercial rollout and handover to new process owner: After validation of design entity and

process control has defined, it is time for starting the new entity and full-scale commercial together with

supporting processes.

49

3.6.1.1. Tools for IDOV

Figure 3.7. Overview of the tools in IDOV process [13]

3.6.2. DMADV Process

The DMADV approach was designed to develop a service, product, or process that will successfully address

identified issues and maintain it through normal operations. A top level decision is needed to drive and

support the DMADV project, and this can be one basis for its link to strategy implementation. From another

perspective, implementing strategies identified in a long-range or strategic plan often involves introducing

new services, products, or processes and procedures. Because of its focus on success through thorough

analysis, DMADV may be a useful approach to strategy implementation.

Identify

•Market/customer research

•Quality function deployment

•Kano analysis

• Risk analysis

Characterize

• TRIZ

•QFD

•Axiomatic design

•Robust design

• DFMEA and PFMEA (design and performance failure mode–effect analysis)

• Design review

• CAD/CAE (computer-aided design/engineering)

•Simulation

•Process management

Optimize

• Design of experiment

• Taguchi method, parameter design, tolerance design

•Reliability-based design

•Robustness assessment

Validate

• Process capability modeling

• DOE

•Reliability testing

• Poka-yoke, error proofing

• Confidence analysis

• Process control plan

• Training

50

Figure 3.8. Overview of key steps In DMADV process

Define: The goal of this step can be identified as three items: the first one is initiating the project by develop

the business, define the problem and relative goals, and calculate the planned benefits and the execution

roles. The second one is define the scope of the project by define the plan and its effect on the project. The

last goals is managing the project by planning the resources, cost , time schedule, change management, risk

assessment and kick off meeting. Align with the planned goals is necessary to consider the customer’s

requirements, quality of services or products, cost, delivery time, safety and corporate responsibility.

Project team is formed after identified the problem. By determination each member responsibility in team,

it is time to set goals and its measurement approaches. The last part will be finish by determining a time

schedule and guideline for project review and risk assessment.

Measure: In this step goals consider as the follow: identifying customer and their need by segmentation

them, system critical design requirement, allocation the output measure and their target values and

tolerances. At the beginning this step starts with data gathering and fulfilling accurate analyzing on data to

state the problem situation and there are also some preliminary ideas of possible causes for problem. This

step consists product characteristics, process mapping, requirement measurement, and result publishing.

The vital point in this step is measuring the factor that are critical to quality (CTQs) to understand which

factor are critical to the stakeholder and to translate the customer requirements into the project goals.

Analyze: In this step goals define as follow: identify and prioritization of system function, develop and

optimize design concept, and assess the design concept as to its capacity to meet customer requirements.in

this step the hypothesis run about the possible causes of the problem and then try to assess it by

determining the root and causes. This phase is concerned with analyzing and benchmarking the key

product/process performance metrics and identify the common factors of successful performance. Develop

design alternatives, identify the best combination requirements to provide value within constraints, develop

conceptual designs, evaluate, select the best components and develop the best available design.

VerifyDesignAnalyzeMeasureDefine

51

Design: Generating and selecting concepts, make a robust design and optimization, meeting specification,

and avoiding design failures are four goals for this step which complete by Develop a high level design,

Develop exact specifications, Develop detailed component designs, Develop related processes, Optimize

design. The process map should create to building clearer layout, along with the engineering detail of the

product specification. All critical process parameters are identified, then risk assessment and capability

analysis fulfil in order to identify where error may occur and to make necessary modifications.

Verify: validate that design is acceptable to all stakeholders, complete pilot test, confirm expectations, and

expand deployment are four goals here.to assessment the marketability of the product, the pilot test run

to engage customers. Several pilot and production runs will be necessary to ensure that the quality is the

highest possible. Here, expectations will be confirmed, deployment will be expanded and all lessons learned

will be documented. The Verify step also includes a plan to transition the product or service to a routine

operation and to ensure that this change is sustainable. [40]

3.6.2.1. Tools for DMADV

Figure 3.9. Overview of the tools in DMADV process.

Define

•Kano/ servey

•Project Management Tools

•Project Selection

•Benchmarking

•SIPOS

•C&E Matrixs

•CTQ Matrixs

Measure

•Brainstorming

•FMEA

•DOE

•QFD

•Benchmarking Transfer Function Process Map

Analyze

•FMEA

•Reliability

•Risk Analysis

•Pareto Analysis

•Gap Analysis

Design

•Robust Design

•DOE

•Specification Design

•Work Design

•Machine Design

•Engineering Design

Verify

•Reliability Test

•FMEA

•Simulation

•SPC

•Control Plan

52

3.6.3. DMAIC Methodology

Figure 3.10. Big Picture of DMAIC Methodology

Definethe

prblem

Measurethe

process

Analyze the

process

Improve the

process

Control the

process

To develop a clear project

charter based on the real

problem that is relevant to the

customer, and that will

provide a significant benefits

for the organization.

To understand and the baseline

the current performance of the

process, through a set of

relevant and robust measures

(KPIs).

To find root and causes of

problem, and

understand/quantified their

effect on process

performance.

To develop, select and

implement the best solutions,

with controlled risks.

To ensure the solutions are

embedded, the process has

robust controls, and the

project has clear closure.

Gain project approval:

The end of the define

phase is decision point. A

project review is required

to assess the define phase

outputs, to gain a

consensus that the project

is worth doing, and to

commit the resources

required for it to succeed.

Close the project:

Successful projects need

clear and visible closure, the

key element of which should

include; documenting

lessons learnt, transfer of

the process back to

“business as usual”, and

finally celebrating success.

An iterative

approaches:

Despite the

rigid nature of

the DMAIC

flow, the first

four phases are

often iterative

in their

application.

53

3.6.3. Other six sigma methodologies

There are also other types of options for implementing DFSS process like DCCDI, DMEDI and DMADOV

(define, measure, analyze, design, optimize and verify) which is not necessary to cover them for this essay.

54

Chapter Four

4. The Synthesis of DMAIC Methodology and Project Management

DMAIC resembles the Deming’s continuous learning and process improvement model PDCA (plan-do-check-

act) [44]. Most Six Sigma projects are organized around a process improvement approach that is referred to

as the DMAIC process. DMAIC is an acronym for five interconnected phases: define, measure, analyze,

improvement, and control. It is a six sigma business philosophy that employs a client- centric, fact-based

approach to reducing variation in order to dramatically improve quality by eliminating defects and as e

result, reducing cost [45]. Within the Six Sigma’s approach, DMAIC assures the correct and effective

execution of the project by providing a structured method for solving problems [46]. Here all four steps have

explained with their related tools:

4.1. Define

The define phase ensures that the problem/process selected to go through the DMAIC process

improvement methodology is linked to the organization’s priorities and has management support. The

define phase start with identifying a problem that requires a solution and ends with a clear understanding

of the scope of the problem and evidence of management support, who authorize the project to move

forward through a commitment of resources .[47] In the following pages, a list of tools has collected in this

phase.

Figure 4.1. Tools for Define Phase

Project Charter

VOC

COPQ

GEMBA

SIPOC

kano Analyze

QFDs Matrixs

CTQs Matrixs

AHP

Affinity Diagram

Gantt Chart

The official plan and authorization for the project is summarized in this tool.

Capturing the feedback from the customer for providing better service and

product.

It is means actual place and used for determining which process contains of

problem.

A simple map for understanding the core process.

A simple ranking scheme which distinguishes between various attributes.

Translate customer needs into technical requirements and measurable

features.

Covert customers’ needs to measurable requirements for implementation.

It aids the decision maker to set priorities and reduce complexity.

Organizing large gathering info into groupings based on their natural

relationships. Type of chart to show project scheduling (Time, Duration, Task…)

The costs associated with any activity that is not done right the first time.

55

Figure 4.2. The flow through Define Phase [48]

4.1.1. Cost of Poor Quality(COPQ)

There are many Costs of Poor Quality (COPQs) that are easily recognized, such as rework, rejects, inspection,

testing, customer returns and complaints, etc. However, behind these, there is also usually a large range of

COPQs that have become so common that we start to view them as 'normal', such as excess inventory, late

payments, expediting costs, high employee turnover etc. The different kind of cost of poor quality as before

in the project management chapter has been explained can be defined as appraisal, prevention, internal

failure, and external failure.

4.1.2. Voice of Customer

The Voice of customer (VOC) is a process used to capture the requirement or feedback from the customer

(internal or external) to provide them with best-in-class service or product quality. The process is all about

responsiveness and constant innovation to capture the customer’s changing requirement over time.it could

be captured in a variety of ways including direct discussion or interview, surveys, focus group, observation,

warranty data, field reports, and even complaint logs. The data is used to identify the quality attributes

needed for a supplied component or material to incorporate into the process or product. Typically the

output of voice of customer process are:

A list of customers and customer segmentations.

Define the business

case

Understant the

customer

Define the process

Manage the process

Gain project approval

-Project Charter -Project charter and Plan

- Effective team and meeting

-SIPOC Diagram -GEMBA

-VOC - KANO Analysis

-QFD - CTQ

-problem statements -Goal Statements

-cost of poor quality

What is wrong? What do you

want to achieve?

How does the problem link to the customer?

Are you clear which process the

problem relates to?

Who? When? How?

Where?

Does the project have the buy-in to proceed

and succeed?

56

Identification of relevant and proactive source of data.

Verbal and numerical data that identify customer needs.

Define critical to quality (CTQ) requirements.

Specification for each CTQ requirement.[49]

Moreover, measuring the VOC requires understanding three important concepts: Kano needs, value stream,

and market segmentations. The first concept presented by Professor Noriaki Kano of Tokyo Rika University

who developed three categories to classify customer needs, the first is categorized as basic, the second as

performance, and the third as excitement. This tools is be able to classify and prioritize customer needs.

The second concept is about value stream which can be summarized as price, time, utility, function, and

relative customer importance. understanding that value is defined solely by what the customer actually

desires and for which they are willing to pay and that value enabling activities, while not adding direct value,

are necessary. We all then look for the true non-value added activities that add waste in the form of

unnecessary time, effort or cost.

The last concept is presented due to the different needs and value acceptations of the customer. Market

segmentation starts by distinguishing customer needs and wants. Market Segmentation divides the market

into subsets of customers. Any subsets may be selected as a market target to be reached with a distinct

marketing mix.

Understanding the VOC relative to three concepts allow ad organization to design system to collect, analyze,

and translate the VOC into meaningful internal metrics and targets. [50]

The point in the realm of this part is that most of the time the problem is clear, so collecting VOC is not

necessary always.

4.1.3. Quality Function Deployment

Quality function deployment (QFD) deploys the voice of the customer through a cross-functional team’s

project management of the integrated development process. The QFD process establishes customer

objectives and measures and records them on a series of matrices. QFD is a structured methodology to

identify and translate customer needs into technical requirements and measurable features and

characteristics. It is used to identify CTQs of the process. QFD also has a relationship with the VOC. VOC is

the independent process and QFD is the dependent process. [51]

57

Figure 4.3. House of Quality

In six sigma DMAIC the QFD methodology can be used in define phase [52]. QFD is a customer driven

planning tools that help to increase efficiency of product design and production. The principle aim is to

ensure that the customer requirement are integrated in the design and production of the product. QFD

ensure that the product is not offered to the customer as seen by the design engineer but rather as seen by

the customer itself. This could lead to improve the competitiveness of the manufacturer, ensure customer

loyalty, reduce waste, and improve the bottom line. [53]

4.1.4. Critical to Quality

Once the VOC accomplish, the project be at a point where the CTQ (Gitlow and Levine, 2004) is ready to

define. [54] The aim of CTQ tree is to covert customers’ needs to measurable requirements for the business

to implement. By using the CTQ tree, the organization will be able to identify critical to satisfaction

requirements. [49] For every specific need, it can be used to determine different drivers for meeting the

need, then for each driver, some measurable performance requirements have found.

Customer Priority

Tech

nic

al

Req

uir

emen

ts

Technical Assessment

Customer Assessment/

Competitive Evaluation

58

Figure 4.4. The Critical to Quality Tree

4.1.5. SIPOC Diagram

Although it is too early for detailed process mapping (that comes in the Analyze phase), a simple process

definition and map at this stage can help ensure everyone understands the core process [48]. Five elements

of suppliers, inputs, process, outputs, and customers are exploited to build the SIPOC diagram which is use

for determining all project elements corresponding to the improvement before beginning the project. At

the end of this diagram the customer requirements can be considered to increase the customer satisfaction

probability by concentrating on effort clarification. It started by supplier’s identification and proceed by

determining the input required by suppliers. Then mapping the process into which the input go and

document its result which is named output. Identify the customers to whom the outputs are directed [55].

Figure 4.5. SIPOC Flow Diagram for Process Improvement[55],[47]

CTQsDriverNeed

DefineNeed

Driver 1

CTQ 1

CTQ 2

Driver 2 CTQ 3

Driver 3

Suppliers Inputs Process Outputs Customers

Provide

Inputs

Inputs enter

the process Transforms inputs

to outputs Product/service

leaving the process

Receive the

Product/service

Specific and Easy to Measure General and Hard to Measure

59

4.1.6. Gemba

Gemba is an approach that focuses on the actual place where key activities happen. For better determining

which process contains of problem, the Gemba can be used. Gemba (a Japanese word) refers to the 'actual

place'. So, in a manufacturing environment, Gemba can refer to the actual place where products are made

like shop floor. Similarly, in a service environment, Gemba can refer to the actual place where a service is

created and delivered like a website. Gemba is used In order to understand how a process really works. In

other words, only by spending time seeing a process actually happening, will be able to observe things such

as:

How the process operates normally.

How the process operates when things go wrong.

What types of problems occur?

How problems are resolved.

How the process is managed and controlled.

The differences between written instructions and reality. [48]

4.1.7. Affinity Diagram

An Affinity Diagram is a tool that gathers large amounts of language data (ideas, opinions, issues) and

organizes them into groupings based on their natural relationships. The Affinity process is often used to

group ideas generated by Brainstorming. It may be used in situations that are unknown or unexplored by a

team, or in circumstances that seem confusing or disorganized, such as when people with diverse

experiences form a new team, or when members have incomplete knowledge of the area of analysis. This

method used to create a kind of cluster in complex situation.

4.1.8. Analytic Hierarchy Process

The Analytic Hierarchy Process (AHP), introduced by Thomas Saaty (1980), is an effective tool for dealing

with complex decision making, and may aid the decision maker to set priorities and make the best decision.

By reducing complex decisions to a series of pairwise comparisons, and then synthesizing the results, the

AHP helps to capture both subjective and objective aspects of a decision. In addition, the AHP incorporates

a useful technique for checking the consistency of the decision maker’s evaluations, thus reducing the bias

in the decision making process. [56]

60

4.2. Measure

In this phase, the six sigma resources determines the baseline performance of the process, validates the

measurement system in place is accurate, and makes an assessment of capability. This is the sigma level of

the process and is the measure of process performance against the customer’s expectations. By measuring

the process capability to reach the six sigma level for meeting the customer’s expectations. Just for give a

frame of reference, if a process was at sigma level of six, it is means that the process would has a few defects

and if the process positioned in zero sigma level indicate the half of the productions would be defected[57].

Here is list of tools in measure phase:

Figure 4.6. Tools for Measure Phase

KPIs

Operational Diagram

Stratification and Data Collection Plan

MSA

Histogram

Normal Distribution

Process Capability

Pareto Principle

It is a measurement tool to reflect the performance of the process

A common and useful statistical model to show the data normality.

It is the assessment of how well the process delivers what the customer wants.

Determining how much the variation within the measurement process contributes to overall process variability

A diagram consisting of rectangles whose area is proportional to the frequency of a variable and whose width is equal to the class interval.

Decide about what, how, how much, and how often data should be collected by considering the data type (discrete or continuous) and also determine how to classify the data.

Part of an operation which shows each KPI is referring to which parts of the process

The majority of influence on an outcome is exerted by a minority of input factors.

61

Figure 4.7. The Flow Through Measure Phase [48]

4.2.1. Key Performance Indicators

Key Performance indicators (KPIs) are measurements that reflect the performance of the process. By

understanding customers CTQ features in the define phase, they are then used as the basis for KPIs.

Developprocess

Measures

collect process

data

check the data

quality

understant process

behaviour

baseline process

capability and

potential

How can measure the

problem?

When and where does the data come from?

Does the data represent

Well the thinking?

How does the process currently

behave?

What is the Current performance of the

process?

-KPIs -Operational

Definition Diagram

-Pareto Diagram

-Strafication and Data

collection plan

-MSA

-Normal Distribution -Normality

testing -histogram

-Process Capability -Cp, CpK -DPMO

-%Defection

TOO

LS

62

Figure 4.8. The KPIs builds upon CTQs

Customer driven KPIs are usually percentages that classify the process output into pass or fail categories

based upon the customer's CTQs.

A KPI Tree is a visual method of displaying a range of process measures that are relevant to project or

process. It is particularly useful for demonstrating the different categories of measures.

4.2.2. Operational Definition Diagrams

A process diagram or picture is an essential part of an effective operational definition. By a simplified process

map can demonstrate that the KPI is referring to which parts of the process. For example in the below figure

two KPIs are considered; for the first KPI, the time to repair starts at the end of the fault reporting process

and stops after the customer has been informed and the Fault closed and the second KPI, represents the

percentage of faults that are fixed after the engineer's first visit.

The Needed Collected Data

Customer Driven KPIs

CTQ Specifications Call answered within 7 rings

Percentage of call answered within 7 rings

Time taken to answer each call

63

Figure 4.9. Process Diagram

4.2.3. Data Collection Method

Data collection is an expensive process and yet most companies collect large amounts of poor quality data

with high duplication. Successful data collection requires clear goals and a focus on preparation. Two key

types of data collection can be consider as follow:

In process: where the data collection is integrated into the process and therefore recorded

automatically.

Manual: where the data collection system is additional to the process and recorded by text

and typing.

4.2.3.1. Data Collection Plan and Stratification Concept

Having decided what to measure and how to record it, a Data Collection Plan specifies how much

data will be collected (the sample size), and how often (the sampling frequency).

Data collection from a Population or Process?

Collecting data from a static group is focused on a Population. Every day examples include

taking a water sample from a swimming pool to estimate its chlorine content or market

research with a focus group to estimate the population's view. In these situations, the main

data collection decision is what sample size to use (how much data to collect).

Customer Report Fault

Diagnose Fault

Engineer Visit

Fault Fixed

Inform Customer and Close

KPI 2= Fixed first

time(%)

KP

I 1=

Tim

e t

o R

apai

r(H

ou

rs)

64

Collecting data on an ongoing basis in order to detect changes over time, is focused on a

Process. Everyday examples include tracking the fuel consumption of a car over its lifetime

or monitoring a commute time to work. In these situations, the data collection decision is

not only what sample size to use (how much), but also the sampling frequency (how often).

4.2.3.2. Minimum Sample Sizes

According to types of data, Continuous data or discrete data the minimum size of sampling can be different

because each of them has a specific calculated formula. Minimum sample sizes are just a starting point for

use in basic Six Sigma tools such as Histograms, Capability Studies and Sigma Levels. More advanced

techniques such as SPC charts and Hypothesis Testing may require larger sample sizes. The most common

question concerning data collection is how much data should be collected? Answering to this question

depends on the data types: continuous data or discrete data.

4.2.3.2.1. Continuous Data

To calculate the minimum sample size for continuous data, the standard deviation of the process should be

estimated. A very basic approach for estimating standard deviation is to look at the historical range of a

process (the difference between the highest and lowest results) and normally, there are around six standard

deviations in the range, so this is a safe over-estimate. Then decide on the precision

that project requires. After that the following formula can be applied to calculate the minimum sample size:

MSS= (2 x Standard Deviation) / Precision) ^2

4.2.3.2.2. Attribute (Discrete) Data

To calculate the minimum sample size for discrete data, first the proportion of the process should be

estimated. Knowing the expected proportion in the process helps to achieve a more realistic sample size.

Then decide on the precision that project requires. After that the following formula can be applied to

calculate the minimum sample size:

MSS = (2/precision) ^2 x Proportion x (1- Proportion)

65

4.2.3.3. Sampling Frequency

Sampling frequency means decide when and where to sample the process. As every process has some level

of expected 'cycles' in its output, the company should select the frequency with which to monitor its

process. For a process for an example, operating across 3 shifts, the duration of the expected cycles could

be around eight hours. [48]

4.2.3.4. Data Stratification

Data stratification is the separation of data into smaller, more defined strata based on a predetermined set

of criteria. A simpler way to view data stratification is to see it as a giant load of laundry that needs to be

sorted.

4.2.4. Measurement System Analysis

A measurement system is not just a device, such as a ruler or timer, but it includes the people, standards,

and procedures that surround the measurement process itself. Measurement System Analysis (MSA) refers

to a range of techniques that can help to identify and measure the sources of error in collected data.

MSA is a process that was developed by the nonprofit organization Automotive Industry Action Group

(AIAG). AIAG concentrates on the following measurement analysis conditions: Bias, stability, linearity, and

repeatability and reproducibility.

Bias is a measure of the distance between the average value of the measurements and the “True”

and “Actual” value of the sample or part.

Stability refers to the capacity of a measurement system to produce the same values over time

when measuring the same sample.

Linearity is a measure of the consistency of Bias over the range of the measurement device.

Reproducibility assesses whether different appraisers can measure the same part/sample with the

same measurement device and get the same value.

Repeatability assesses whether the same appraiser can measure the same part/sample multiple

times with the same measurement device and get the same value. [58]

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4.2.5. Process Capability

Process Capability refers to a range of KPls (metrics) that measure the ability of a process to deliver the

customer's requirements. for example in the a histogram the range between the lower and upper

specification limits is referred to as the Voice of the customer (VOC) and the total variation in the process

(affecting the width of the histogram) is referred to as the voice of the process (VOP). Process capability is

the comparison of the VOP to the VOC (process versus customer).if the width of the histogram (VOP) is

smaller than the gap between the specifications limits (VOC), it appears that this process should be capable

of delivering within specifications.

Figure 4.10. Process Capability Route Map [48]

4.2.5.1. Sigma Calculation

Sigma calculations are very useful in the Measure Phase to determine the current sigma level of an activity

or transaction. In order to calculate the Defects per Million Opportunities (DPMO), three distinct pieces of

information are required:

The number of units produced

The number of defect opportunities per unit

The number of defects

The actual formula is:

DPMO = (Number of Defects × 1,000,000)

(Number of Defect Opportunities/Unit) × (Number of Units)

4.2.5.2. Cp and CpK Indexes

Several statistics may be used to measure process capability. A capable process is one where almost all the

measurements fall inside the specification limits. A measurement similar to sigma is Capability Metrics (Cp),

which measures the process capability. A technique used to determine how well a process meets a set of

Calculate the % Defective

Clarify if your % defective is

short /and /or long term

Convert into a sigma level

Calculate sigma level

67

specification limits is called a process Capability Analysis. A Capability Analysis is based on a sample of data

taken from a process and usually produces:

An estimate of the DPMO

One or more capability indices

An estimate of the sigma quality level at which the process operates

The process capability index, Cpk, measures a process’s ability to create a product within specification limits.

Process capability refers to the ability of a process to produce a defect free product or service in a controlled

manner. This is often measured by an index. The process capability index is used to find out how well the

process is centered within the specification limits. [58]

68

Figure 4.11. The Approach to Collect and Analyze the Data Depends on Type of Data

Tools Selection

Decision

Continuous

Data

Attribute

Data

Data

Collection

Population Sampling

MSA

If Necessary

Data

Collection

Sampling

Histogram

(For Simple

presentation)

Process

Capability (If

Collected Data

Short and Long

Term)

Generally

Entire

Population

Data

Collection

Pareto Analyze

(For Select the

most Relevant

Data)

Like internal failure and

scrape (Final Control of

painting in Car Factory)

Like Dimension, Weight,

Hardness, and so on.

69

4.3. Analyze

This is the phase where the technical expert, the black belt, tortures the data collected to uncover the root

causes of the defect. Once they have isolated the potential factors, they use statistical, or hypothesis, testing

to prove concluding that the factors are indeed causing or contributing to the problem. Expect all of these

results to be documented in an FMEA alongside the current risk mitigation measures for each of those

factors. [57]Here are tools for this phase:

Figure 4.12. Tools for Analyze Phase

Process mapping and value stream mapping

Spaghetti Diagram

Fish bone Diagram

Brainstorming

Five Whys

FMEA

RegressionFMEA

Graphical Tools

ANOVA

DOE

A simple tool that can help to highlight process waste, particularly excessive transportation by mapping the actual route and sometimes use to find potential root causes.

A statistical processes for estimating the relationship among variables by modeling and analysing several variables.

Bring clarity to complex processes and can be used to highlight particular aspects of the process that are relevant to your improvement project.

A powerful tools to achieve manufacturing cost savings by minimizing

process variation and reducing rework, scrap, and the need for

inspection

Be able to offer excellent functionality by presenting graphs. • Graphical Tools

For determining the existence of differences among several population mean (three or more).

Graphical Tools

It is used to identify a range of potential root causes for a generic type of failure.

• Graphical Tools

Capturing ideas and stimulating team’s brainstorming on root causes which help to visually display the many potential causes for a specific problem .

It can be used to investigate specific failures (opposite of Brainstorming). • Graphical Tools

A procedure used to identify, assess, and mitigate risks associated with potential failure modes in a product, system, or process.

70

Figure 4.13. The Flow through analyze Phase

4.3.1. Process Mapping and Value Stream Mapping

Process mapping is a way of visually representing a process. It helps in understanding how the process

actually works, and is a foundation for further process analysis. Among other benefits, process maps help

bring clarity to complex processes and can be used to highlight particular aspects of the process that are

relevant to your improvement project, such as: value add or non-value add steps, reworks loops. Moreover,

Process mapping is a fundamental tool within process improvement. By documenting how a process actually

works, process mapping stimulates questions and provides useful insights.

This enables a project team to start thinking about potential improvements. It also link to other elements

of process improvement like value stream within the process. Value Stream Mapping (VSM) is an advanced

form of process mapping that focuses on a process using the principles of Lean and from the perspective of

value which is used for projects that are focusing on improving flow and efficiency and reducing waste.

Analyze the Process

Potential Root Causes

Analyze the Data and root

causes verification

Supplementary Verification Rootcauses

-DOE: Depending on the situation

is used.It is not mandatory.

-Process mapping and Value stream

mapping -Spaghetti Diagrams

-Graphical tools -ANOVA

(X= discrete, Y= continuous) and

Regression (X= continuous, Y=

continuous).

-Fish bone Diagram

- Brainstorming - Five Whys

-FMEA

How does the process

actually work?

What does the existing process knowledge say?

What does the data say?

How does the root causes affect the process output?

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4.3.2. Spaghetti Diagrams

Spaghetti diagrams are a practical tool that are very easy to use and provide valuable information. Spaghetti

diagrams are a simple tool that can help to highlight process waste (particularly excessive

transportation) by mapping the actual route of a particular resource through a physical environment.

4.3.3. Brainstorming and Five Whys

Brainstorming is a valuable technique that can be used in many environments, and for many purposes. In

Lean Six Sigma projects, brainstorming is often used at the beginning of the analyses phase. While the five

whys technique (opposite) can be used to investigate specific failures. Brainstorming can be used to identify

a range of potential root causes for a generic type of failure. If a problem is going to be fixed, the real root

cause needs to be understood. Sometimes it is useful to randomly select two to three real failures in the

process and to investigate them in much more detail using five whys.

4.3.4. Fishbone (Cause and Effect) Diagrams

Fishbone diagrams are usually used during brainstorming, to identify root causes. However, they can

be also be used throughout the analyze phase as a great tool for structuring a team's thoughts.

4.3.5. Failure Mode and Effect Analysis

Failure Mode and Effect Analysis (FMEA) can be used during analyze, improve or control to highlight the

aspects of a product or process that should be targeted for improvement. FMEA is essentially a risk analysis

tool that can be useful in environments where you have to prevent an event ever happening or where the

failure rate for a process is so low that there is little opportunity to learn from past failures. There are two

key types used within Six Sigma, as follows:

Product FMEAs analyze the function, design and potential failure of each component of a product.

Process FMEAs analyze the key outputs and potential failures of each step of a process, and consider

the effect of process failure on the product or service concerned.

72

For calculating the risk amount, the value for three elements should be multiple to each other (RPN). There

are severity, occurrence and detection .The ratings for severity, occurrence and detection are usually on a

scale of 1 to 1 0. There are several versions of tables that help to define the different ratings.

4.3.6. Graphical Tools

Some engineering software like Minitab be able to offer excellent functionality by presenting graphs. Some

of the m can be listed as description statistics, histograms, dot plot, graphical summary, probability plots,

time series plots, run charts and Pareto charts, box plot, individual value plots, matrix plots, and scatter

plots.

4.3.7. ANOVA and Regression

By considering the hypothesis testing, where a specific statement or hypothesis is generated about a

population parameter, and sample statistics are used to assess the likelihood that the hypothesis is true.

The hypothesis is based on available information and the investigator's belief about the population

parameters. The specific test considered here is called analysis of variance (ANOVA) and is a test of

hypothesis that is appropriate to compare means of a continuous variable in two or more independent

comparison groups.

(Boston University School of Public Health, Professor of Biostatistics, Lisa Sullivan, PhD)

Linear regression attempts to model the relationship between two variables by fitting a linear equation to observed data. One variable is considered to be an explanatory variable, and the other is considered to be a dependent variable. A linear regression line has an equation of the form Y = a + bX, where X is the explanatory variable and Y is the dependent variable. The slope of the line is b, and a is the intercept (the value of y when x = 0).

73

4.3.8. Design of Experiment

DOE is the acronym given to a range of experimental techniques in which the process is experimented on in

a controlled manner, and the results observed and analyzed. The aim is to identify the important inputs to

the process and lo understand their effect on the process output. Designed experiments are used to create

and analyze real time data that is taken from the process in an experimental mode. Generally the DOE

procedure can be considered as follow:

Figure 4.14. The Steps for Design of Experiment

Identify the process OUTPUT variable

Identify the process

inputs that might affect the output

Design the experiment

Run the experiment

Analyse the results and run further

experiments if necessarySt

art

fro

m

Her

e

74

4.4. Improve

This phase begins with this fact that the black belt knows what is the causing of the problem, they should

predict what the performance of the process would be if they fixed the issues they have uncovered. This is

achieved through design of experience (DOE), and allows them to build an equation called the transfer

function. This is crucial as it facilitates the evaluation of the multiple solution sets, which should be

documented in a solutions design matrix, by allowing side-by-side comparisons of the proposed solutions

and performance of the competition. This is consider as final opportunity to halt the project prior to further

investment and irreversible, at least without great cost, changes to the process. [57]

Figure 4.15. The Flow through Improve Phase

Generate Potential Solutions

Select the Best Solutions

Assess the RisksPilot and

Implement

What are all the different possible

solutions?

What are the risks of implementing

the solutions?

Which solutions are most likely

to work?

When,Where,and How will the solutions

be implemented?

-Negative Brainstorming

- Brainstorming

-Pugh Matrixs -Priorisation Matrixs - paired Comparisons

-FMEA

-Five S -Pilot Management

- Visual Management

TOO

LS

75

Figure 4.16. Tools for Improve Phase

4.4.1. Visual Management

Visual Management encompasses a wide range of techniques that help make all aspects of a workplace,

and the processes that take place within it, more visually apparent. It includes visual techniques that help

to: organize the workplace. , control and standardize process inputs, manage the storage and flow of

products/services, monitor processes (often in real time), communicate process performance, and improve

safety. [48] As one of the lean manufacturing component, the purpose of visual management is to improve

the effectiveness of communication and reaction. Visual aids can convey messages quicker and invite more

interest than written information. And this also means exposing defects and problems to allow them to be

addressed sooner.

Negative Brainstorming

Benchmarking

paired Comparisons

Prioritision Matrixs

Pugh Matrixs

FMEA

Five S

Poka -Yoke Principles

Pilot Management

VisualManagement

It helps think very differently about a problem, and how to solve it.

Identifying and adopting the best practices from other organizations to improve process.

A team based approach for ranking different options against each other.

Selecting the most proper solution by using weighted criteria and consensus of the team. Not only is a selecting solution method but also it is a method for further developing and refining the potential solutions together.

A pilot study is a localized, controlled trial of a solution in order to test its effectiveness before full implementation.

A useful structure for improving workplace environments, organization‘s culture.

By reconsider FMEA In improve step, in order to improve the solution , it is not used for selecting cause and effect here.(actually using second part of FMEA)

A graphical method to display and communicate how a process/ work place is managed, controlled, and performing.

A mechanism that helps prevent human error or inadvertent error prevention.

76

Figure 4.17.The Visual Management Benefits

VisualManagement

Improve housekeeping as part of Five S

program.

Improve quality as a part of an error

proofing program.

Ruduce accidents as part of a safety

program.

Minimise work in progress through visual kanbans.

77

4.5. Control

After implementation in the improvement phase, the final phase is ensuring that the solution is integrated

into the operational environment and that is indeed improved the process.

Figure 4.18. The flow through Control Phase

Implementongoing

measurement

Standardise the solutions

Quantify the improvement

Close the project

How will the process will be measured after the project?

Have the changes become business as

usual?

Has the project goal been achieved?

Does the project have a clear closure

process?

- Control plan - KPIs Tree - Statistical process control(SPC)/ control chart

-Visual Management

- Statistical process control

(SPC)

-Project Report and entering key information

in project tracking approach in project.

-Evaluate the possibility of repetition

TOO

LS

78

Figure 4.19. Tools for Control Phase

4.5.1 .Project Report

One of the important project management tools that can be exploited in the last phase of DMAIC

methodology is a formal presentations made to the champion and sponsor of the project. Others may be

part of the group, including other black belts, process owners and member of management. The project

report should follow the DMAIC sequence and include the process and tools used at each step. An evaluation

about working situation at each step provides learning for others. A side- by – side comparison of the

elements of the original charter and scope of the project with validated results from the project

demonstrates success. It is instructive for sponsors and process owners to see the change from the originally

conceived problem statement or project scope to the agreed upon scope. In general, people who have seen

Control Plan

KPIs Tree

Statistical process control (SPC) and

Control chart

Visual Management

Project Report

Project Tracking

SPC is a sophisticated control chart form of Time Series plot that enable the stability of the process, and the type of variation involved, to be understood. The control chart is a graph used to study how a process changes over time. Comparing current data to control limits to find whether the process variation is in control or is out of control.

A visual method of displaying a range of process measures that are relevant to project or process.

For each process step, a control plan defines the characteristics that are measured, their specification, historical capability, measurement method

used and a response plan if out of specification.

A visual method of displaying a range of process measures that are relevant to project or process.

A formal document that includes project descriptions, problem solving key points, detailed supported, and recommendations.

Project Tracking can refer to Project Management software, which automates the tracking of tasks, assignments, events and activities related to the project.

79

a number of presentations from successful projects learn and are better at developing a properly scoped

project. Using the learning from a previous project may reduce the time significantly. The small saving in the

time and effort from using a short cut process are seldom worth the problem that arise.it would be wisely

to go through the full DMAIC steps for every implementation of changes. [65] In figure below some

components for project report are listed.

Figure 4.20. The Project Report Components

The last but not the least point is in the formal part of the final project report there be a section for

identification of new projects that are extensions of the completed project, or come from the investigation

of the current project, and are, in the opinion of the black belt and project team.[65]

In the next chapter, there is a table about the project selection and project report which is provide the

opportunity for all members who access to E- tracker, to write their ideas and opinions about projects.

Furthermore, each member according to the type of responsibility that hold, can insert his/her report.

Component of project report

Clear storyboard through the DMAIC

phases of the project.

Keywords (for successful archiving

and knowledge management).

Closure Action Log

Clear records and access to data

used.

Lessons learnt

All outstanding actions should be documented at project closure with clear responsibility and target. dates for completion.

80

Figure 4.21. The most common Tools Usage on Projects

Project Charter

Gantt chart

Process Mapping

(High Level)

Is VOC is clear?

VOC Package Data Collection

Strategy

Pareto Diagram Process Capability

Histogram

- For simple Project: Cause & Effect Diagram

- For Complex Project: FMEA

ANOVA

X= discrete

Y= continuous

Regression

X= continuous

Y= continuous

Brainstorming

Pugh Matrix

Discrete Continuous

NO YES

Control Plan

Control Chart

Focus group

Claim

Warranty

Survey

Interview

81

4.6 .Tools usage percentage

This below figure derived by investigating the diverse number of projects in very prominent companies. As

the figure has shown, increasing the percentage of usage, indicates that specific tool has much common in

different projects. It is urgent to add this point, it does not always mean that fewer usage tools are less

important. For instance, some tools related to the risk management just have been exploiting in the complex

project. So much that, they are less common in comparison those process planning tools which have pivotal

roles in every defined project.

Figure 4.22. The usage Percentage of Tools in Classical Six Sigma by Considering 3000 Projects.

(1200 Fiat- 500 GE- 500 Caterpillar- 800 Others.)

82

Chapter Five

5. The Robust Hybrid template 5.1. A Dashboard for Top Managers

Figure 5.1. Project management and DMAIC Dashboard for top manager

Managerialresponsibilities

Project 1 Project 2 Project N

Project Charter 1

Project Charter 2

Project Charter N

3NN

Systematic evaluation for updating and cheaking Whole the projects in an united Gantt chart

83

Figure 5.2. Systematic Evaluation Updating for Project and Daily Check all Project by top Manager

Put project name here SUBMIT CANCEL

Name of Project

Started

Date

Finished

Date

Gantt Chart

Team

Leader

Status

Roadmap

Project 1

12/07/17

23/08/19

Mr/Mrs

Measure

DMADV

Project 2

01/03/17

01/09/18

Mr/Mrs

Define

DMAIC

Project 3

05/08/17

07/03/18

Mr/Mrs

Imrove

DMAIC

Project 4

09/02/17

24/08/18

Mr/Mrs

Optimize

IDOV

Project 5

12/06/17

30/04/18

Mr/Mrs

Measure

DMAIC

Project 6

30/1/17

04/04/18

Mr/Mrs

Analyze

DMAIC

Project 7

12/08/17

30/03/18

Mr/Mrs

Control

DMAIC

Project 8

15/12/17

15/04/18

Mr/Mrs

Define

DMADV

Project 9

25/09/17

30/04/18

Mr/Mrs

Define

DMAIC

84

Template be prepared in this chapter is derived of investigating on some big companies that have

approximately following similar procedures. DMAIC methodology is designed to increase the problem

solving capabilities, by providing the opportunity to combine it with project management which aims to

increase our capability to control the problem, each organization can expect the better result in comparison

with use each of them solely.

E-Tracker software is a Web-based project tracking and reporting tool which needs to update regularly. It

can display project information for each user who project was assigned to him or her. E-tracker can be

accessed either via web or notes. In both web-base and note-base the functionality is same except for web-

based which provides more sophisticated searching. It includes key project management information

(project charter, team composition, status plan, project plan, and closeout). Another capability of this

software is storing gates, tasks, milestones and critical issues along with due dates and completion dates. E-

tracker provides easy access to different part of a project for each eligible member of the project. The first

attempt is clicking on the E-tracker bottom which provides a concurrent access for all project authorities

and obliviously leads to saving time and increasing performance and team collaboration. The opened page

contains the menu bar at the top and some other parts which indicate the project situation like a canceled

project. If the project was under process, then the desired project can be selected among various available

active projects. By clicking on desired project’s name, the project charter corresponding to it will be opened.

Figure 5.3. The E-tracker menu bar and functional

Click on Project‘s

Name to Access

Project Charter

By Clicking on the

Triangle can expand

the Project list

85

5.2. Project Charter

The project charter is a document that officially announces and authorizes the existence of the project. Over

the signature of the project sponsor, the charter names, the project manager and indicate the extent of the

project manager’s authority over the project and its resources. The project charter is prepared as part of

your initiation work, so it is ready to distribute once the project is approved. [59]

This below template (Figure 5.4) provides several possible sections heading for a project charter. Some

information can be filled in initially and the rest can be completed by going through the define phase of

DMAIC, periodically updating the charter. For each component of the project charter, a number is dedicated,

at the end of figure 5.4, there are completed explanation about each component.

Project title: Project ID:

Project Identification:

Project Description Business Unit

Project Sponsor Team Lead

Process Owner Core Process

Supported Organization Sub- Process

Project status: Active On Hold Cancelled

Start data Duration

End data Modified data

Ownership information:

Organization Business Unit Name Code

Targets or Goals:

1

2

3

86

Objectives:

Business case:

Project Scope

Scope title:

List of stakeholders, sponsors, and other members :

Mr/Mrs Mr/Mrs Mr/Mrs

Project Justification :

Project product :

Major deliverables :

These three items are considered as the speared items of project scope in our template:

- Deliverables and milestones

- Assumptions and constraints

- Risk management

.

Providing some reasons for why the project should be run? (E.g.

customer dissatisfaction or complaint).

What is the project expectation at the end? For instance, resolve 90 %

of the customer’s trouble report whining 20 minutes.

-On duty staff member notified of customer trouble report within 2 minutes.

-staff accesses customer information system whining 6 minutes.

-staff contacts customer with problem analysis and recommendations within 17

minutes.

-90 % of customer use new contact system for trouble reports.

4

5

6

87

Deliverables and milestones:

Key Activity/ Milestone Responsible Target dates Delivarable

Start Due

Assumptions and constraints:

1.

2.

Risk management:

Risk Severity Probability Mitigation approaches

Cost and funding:

1.

2.

Critical Success Factor:

1.

2.

3.

7

8

9

10

11

88

Benefits:

Quantifiable Benefits Descriptions Metrics

Qualitative Benefits Descriptions Metrics

Stakeholder and organization effected:

1.

2.

3.

Project organization:

Figure 5.4. The statement of extended improvement(project charter)[64]

12

13

89

1 - Choose a short, energizing name or acronym that describes your project. Be specific and make sure

you're not duplicating another project's name.

2 - This section describes the context surrounding the project, and presents the primary motivation for the

project. It includes accountable people, a high-level description of the business area, the current situation,

time schedule.

3 - As compelling and inspirational as the business purpose may be, it is still no more than a broad direction,

lacking details about a specific target for the project. Project goals can be defined as cost, time, and

quality.[61]

4 - These are detailed statements describing the ways through which you intend to achieve the goal.

5 - Business case discusses the business issue that is assigned to the project team. Provided by the project

Champion or sponsor, the business case explains why there is a need for the organization to undertake

the project and how it will support organizational objectives. To be sure about the business case, some

questions should be asked about its necessity for customers, businesses, employees, etc.

6 - A project scope is a description of the work required to deliver the product of a project. The project

scope defines what work will, and will not, be included in the project. The project scope guides the project

manager on the decision to add, change, or remove the work of the project. There are two types of scope:

product scope- defines the attributes of the product or service the project is creating and project scope-

defines the required work of the project to create the product. Actually the product scope as a subset of

the project scope. [62] Project scope deals with the required work to create the project deliverables. But

product scope is the attributes and characteristics of the deliverables the project is creating.

A Well- defined project scope that supports the project goal and success criteria is agreed on by the

stakeholders stands a good chance of remaining under control throughout the project.

7 - Refining the project scope breaks deliverables into smaller pieces of work, allowing the scope and the

existing project schedule, budget, etc. to be more accurately defined. In project scope statement, the

deliverables highlighted but here the team must go one step further. Using the information learned during

project initiation, and upon inputs gained by communicating regularly with the customer and other

appropriate stakeholders, the project team must refine the project scope statement to clearly verify each

deliverable including an exact definition of what will be produced and what will not be produced.

Milestones are major events and points in time, indicating the progress in implementing the work

statement and producing deliverables. As a crucial part of the scope statement, the milestones in the

project should be identified.

8 - Assumption: An assumption is a condition that is part of the project and it will affect the project, but

for which specifies are as yet unknown. To move forward with planning, the assumptions about those

90

specifies should be made. Those assumptions might prove true or false, and that is a risk that organizations

have to take. So much that, always there should be a provision for what happens if the assumption turns

out to be false and it can consider as one of the identified risks (risk management is brought in the next

boxes).Maybe the false effect creates more funding, which can be seen in contract with a customer.

Constraint: a constraint is any limitation that places boundaries on the project like finish date or budget

imposed by the project sponsor or contractual constraints imposed by the customer. constraints section

in the project provide this facility for stakeholders to see all limitations of the project and understanding

the factor that can affect the finish date, cost, and other factors.

In this template, the assumptions and constraints have been considering as a separate section of scope

because of providing a better explanation but in general, it can also be integrated with the scope.[59]

9 - A risk is an uncertain event or condition that has a possibility of occurrence in the future, which if it

occurs, can affect the success of a task, a phase, a deliverable, or even the entire project. Risks are typically

occurrence beyond the control of your project that could muck up the works. Like risk of competitors

getting to market sooner. However, in chapter two of this thesis, completed explanations have provided.

The important point here is the awareness of key stakeholders from risks when they attempt to approve

or sign off on a new project. It is also a proper time here to address risks that have plagued projects in the

past. This ensures that the key stakeholders have the facts necessary to make a sound decision about

moving on to the next steps.[59]

10 - It is not possible to create a detailed or accurate cost estimation before the development of the work

breaks down structure which leads to identifying resources, and work estimation. After fulfilling WBS, the

cost becomes more and more clear. But before reaching to that point, in this stage (proposal stage), some

rough cost estimation is needed. For this purpose, the “rough order of magnitude (ROM)” can be created.

By using ROM, it is possible to guess whether a project will be in the neighborhood of some specific

amounts (like one thousand Euros or ten thousand Euros, etc. that is an order magnitude for cost).

Typically, this estimation is based on the cost for similar projects in the past and it will prevent from wasting

time and money.[59]

11 - Critical success factors are the criteria that must be met in order for the project to meet the stated

goal. These factors are determined at the initiation of a project and will not change unless the project goal

change.

12 - Although here in the project charter of our template some initial projection of benefits should be

listed, for creating a complete business case, all potential benefits need to be identified and quantified. In

this template, the benefit has two pillars, one quantifiable benefits (cost reduction, cost avoidance) and

another qualitative benefits (quality improvement, increased functionality).The cost reduction can

consider as one of the most desirable benefits because the reduced cost can be used to justify the

expenditure involved in the new projects. Although cost avoidance is less concrete than cost reduction,

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cost avoidance is also a key benefits area, like avoided additions to staff, whether temporary or

permanent. Almost no one doubts that improved quality is important, the challenge is to quantify all

benefits. If the quality impacts external customers, there may be research that demonstrates either

increased sales due to improved quality or less erosion of the customer base. Quantifying difficulty is also

happen for increased functionality, sometimes increased functionality is instrumental in identifying new

products and new markets. This can translate into increased sales. Similarly, new functionality may reduce

the time to get a product from conceptual stage to market. [63] Metrics are used to ensure benefits, as

well as goals and objectives of organizational stakeholders.

13 - A stakeholder is defined as any person, group, or organization that can affect or be affected by the

project. The primary goal that the project manager has in identifying stakeholder is to ensure their support

for the project (or that they do not oppose the project).

After stakeholders have been identified, it is important to analyze their expectations, requirement, and

the priority with which they should be looked after. The process of stakeholder analyzing encompasses

some steps. It is starts with identify all potential project stakeholder and relevant information about them.

Then, analyze the potential impact, influence, or support that each stakeholder has or could generate for

the project. At the end use this information to classify and prioritize stakeholders to ensure an efficient

use of stakeholder expectation management tasks and activities. The last point is that if any stakeholder

joint to project during the project lifecycle, the stakeholder analyze should update which by using the E-

tracker in this template all member can be notified.[62]

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5.3.Project Plan

The official plan and authorization for the project are summarized in the six sigma project charter, it is a

contract between the project team and its sponsor because any change in the critical elements of scope,

objectives, or schedule requires approval from the sponsor and consensus of the team [60]. By using E-

tracker this cooperation can rise more than before.

For more investigation and project data exploitation, as they are shown in the below figures, the project

leader or member of a team can choose three available below items: project plan, status plan, and close

out. By clicking on each of them another page will be opened which contains relative information.

The first item here is project plan, The objective of a project plan is to define the approach to be used by

the project team to deliver the intended project management scope of the project. The project manager

creates the project management plan following input from the project team and key project stakeholders.

The plan should be agreed and approved by at least the project team and its key stakeholders. Depending

on the type of six sigma methodology which had selected for the project fulfillment, The relative planning

data can be seen in the project plan. Here the DMAIC methodology is selected, by clicking on every step

(Define to control), the task’s list would be opened on the next page. Then by selecting each desirable task,

information like started data, completed data, milestone, gate, etc. can be checked by members. The

important point here is that dates should keep update always.

Figure 5.5. The Project Plan

Due dates, review dates,

and completion dates

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5.4. Status Plan

The second item is the status plan which begins with a note on the project milestone which is a smart way

to note the progress of your project and whether it’s on schedule or not. It is included milestone name, the

completed percentage, the planed/ actual dates.

The risks and issues part, includes issue ‘name, priority or severity of the issue, and current activities to

resolve the issue. This is also a good way for stakeholders to know what going on with the project and it

follows up with the actions that should take in order to avoid or deal with them.

At the end address the overall expenditure and it makes clear where is the project in terms of budget.

Figure 5.6. The Status Plan

Risks & Issues identified

during the life of the

project

Budged spent

Budged spent

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5.5. Close Out

The practice of project close-out finalizes all project activities completed across all phases of the project to

formally close the project and transfer the completed or canceled project as appropriate. The purpose of

project closeout is to assess the project, ensure completion, and derive any lessons learned and best

practice to be applied to future projects.

The project closing process is generally phased over a period of time, rather than being a single event.

Depending on the project type, project close-out can begin as deliverables are completed. Iteration/phases

closed, or at the end of the project.

The project manager should ensure that the sponsor and steering committee understand and support the

project closing process to reduce final project implementation risks.

Figure 5.7. Close Out

These questions should be

answered before project

close out

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5.6. Search

By applying of E-tracker the access to another part through web-based search or note-based search have

been providing.

Figure 5.8. Searching method (Note-based, Web-based)

Search accessed through

the notes by Writing a

Keyword

Listing of Search Results

Refine search

parameters

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5.7. Project selection and project report

In this template, the team’s member’s ideas have been selecting a link which is named ‘Project Ideas”. All

members write their suggestions down and in the next step, whole the collected ideas would be clustered

by some techniques. Selecting a project is achieved by not only navigating the business case influencers and

supporters but how the project is viewed compared to others along the selection criteria. In comparison

part, some form of risk and reward have been compared to choose the best project in terms of benefits.

The project which brings the highest reward relative to the cost with a good chance of it successfully meeting

its objectives will be chosen by the selection committee. For selection committee’s member, collecting

project’s team members have a pivotal role.

The next item, in the below figure, is project reporting which is displayed for all members and team member

with various responsibilities fill in the reports. As communication about the project is a key element in effective

project management within a corporate environment and report and documents should be distributed to various

areas within the company to provide information on the goals and status of the project, in this template, all

members can update with the latest released reports easily. Whenever a report has left in this section all

members would give a notification. Other members after reading reporting files, can attach their comments

and suggestions online to the relative report file.

Figure 5.9. Project selection, and project report

Click here for future

six sigma projects

The user has the

ability to choose

from several types of

reports sorted in

multiple ways.

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5.8. Financial Reporting System

The role of the financial reporting system is to promote decisions that are well-informed and to provide

investors the information they need to make those decisions. A project is fully successful when it delivers

optimum benefit to the organization and its stakeholders and to report these benefits, the best approach is

to introduce them through financial reporting which is relevant, unbiased, understandable, and easier to

use. Benefits should also not be constrained by financial benefits, there are others that it is difficult, undesirable,

or insensitive to put a financial value on (these benefits are called non-monetary).

In this template, all fulfilled projects are listed on the first page of the financial reporting system. By selecting

the desired project the relative information will appear on the next page includes project’s details (all

financial control date, currency, risk should be entered by financial represent), realized benefits, revised

benefit projection (enter initially by the project leader at the end of define phase and later by the financial

represent), and preliminary benefit projection (it considers in two level, the first level is direct benefit and

the second level is indirect benefit like the benefit which going to earn by using same machines or employees

). Another point here is that both revised and actual benefits should update monthly thereafter.

The benefits realization plan is a view of all the benefits, their dependencies and expected to time for benefits

realization. It sets out what stakeholders can expect from the project or program and is used as the basis for

tracking against what is actually realized (entered by financial represent). It contains the intermediate and final

targets and thresholds of the KPIs that are relevant to gauge the performance of the implemented solution.

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Figure 5.10. Six Sigma Financial Reporting system

Update the project by

selecting on them

By Clicking on edit bottom

can Revise Benefit Project

Some information like

project name, phase, and

status have recorded here

Preliminary Benefit

Projection in Two level

The First level is for Direct Benefit

and the Second is for Indirect Benefit

(Same Machine Usage)

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5.9. Conclusion

As specified in previous chapters, in this thesis, plenty of successful projects in leading companies have been

considered and the designed template is a result of the experiment obtained from these immense amounts

of projects and the advanced knowledge and standard in the realm of lean six sigma and project

management.

In our thesis, we broke down every step of elected six sigma methodology in groups of tasks by determining

their sequence. And then, for succeeding to fulfill every task, list of tools from lean six sigma and project

management have been proposed. In the designed template, we have followed this approach and we have

tried to display that how the capability of the project management to practically control a problem and lean

six sigma as problem-solving methodology, can be integrated to create a dominant instrument to fulfill the

distinct range of projects including the complex ones.

This template includes the necessary subjects from initial planning to ultimately reporting, which are needed

to cover the domains of a project. We have tried to elaborate them as much as we can, according to the

scope of this thesis.

Although this template is concentrating on different perspectives of the project, the main purpose is

presenting an approach to make a transparent, accelerated, uncomplicated, manageable cooperation

between project members with different responsibilities by exploiting or integrating tools.

Obviously, this work cannot be considered an end of the work. Some actions like recording data, lesson

learned, closure action log, etc. should be completed and exploited in the future thesis (projects), especially

complicated projects. As of now, a list of future trend for lean six sigma has been proposed in the next page

to emphasize at this stage that we should develop our organizations for fulfilling more complex and

immense projects by using change management to organize our organization in the realm of generating

mature culture; training employees with enthusiasm and commitment; create more professional employees

by providing sophisticated training; building more effective and practical tools, affordable, manageable, and

effective procedures for oncoming projects, etc.

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5.10. Future Development of lean Six Sigma

Figure 5.11. Future Development of Lean Six Sigma [66]

Future Trends for Lean Six

Sigma

Comprehensive Data Collection

and Analysis (Big Data)

Renewed Focus on Interpersonal and Team Skills

six sigma project management

must be Strongly Recommended

Smaller

Projects and Daily Usage of Lean Six Sigma

Techniques

Although data mining is valuable, the significant point here is not potential and power to collect data, but the key is the ability to properly collect and analyze data.

Every member need to be competent in interpersonal skills such as negotiations, conflict resolution, and leadership. Effective stakeholder management and communication are essential elements for anyone leading process improvement initiatives.

Powerful

Analytical

Tools (Business

Analytics)

When processes are complicated and the simple tools are not giving the improvement that is needed, then it is time to break out the more advanced analysis and testing techniques. These tools can lead to breakthrough improvements.

Another evolution is six sigma project management must be strongly recommended for the complex projects (DFSS).

Including smaller “rapid improvement events” into the mix of projects will help Lean Six Sigma and process thinking to become part of daily operations, Not every process improvement effort needs to be a huge project.

101

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