Slide 1

Report
Lean Sigma
applied to Government Workplaces
…making a Better Place to Work!
Helping Missouri Businesses Succeed!
“A job without frustration is not a job.”
• Inadequate resources
• Conflicting demands
• Unnecessary activities
• No clear definition of value
• ?
• Sources of stress?
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How are we doing?
• Satisfied constituents?
• Engaged employees?
• Balanced budget?
• Sustainable?
• ?
• Sense of accomplishment?
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“We like change as long as everyone else does it
and I don’t have to get out of my comfort zone”
“Everything continually changes”
“We must make change work for us, or at least not
against us”
“Will we be proactive in dedicating resources to
embracing change?”
Man-hours?
 Dollars?

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Lean Sigma integrates =
Lean: non-value added reduction
+
Six Sigma: root cause analysis
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Lean Strategy is focus on identifying
and eliminating (reducing) any
consumption of time and resources
that does not create constituent value.
These non-value added activities are the things
that give us headaches and hassles.
And they are unnecessary!
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Six Sigma is the use of root cause
analysis tools to identify and change
processes that result in less than
maximum constituent value.
These tools include the range of methods from
statistical models to group problem solving.
They reduce variation and increase predictability
of outcomes!
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Successful Lean Sigma is a developed
problem solving culture that combines
the use of technical tools with group
collaboration.
The building of a team culture requires an effort
equal to the implementation of technical tools.
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How do you do it?
1. Train in Lean Sigma culture and tools
2. Develop leadership steering function
3. Define meaningful measures of performance
4. Value Stream Mapping of customer service
processes
5. Pilot projects to refine methods and show
results
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Central Goals of Lean

Flexibility to respond to constituent needs
Focus on efficiency of value creation stream
 Eliminate non-value added activities (waste)

Maximize employee responsibility
 Environment of continuous improvement

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Lean = Elimination of Waste
Value Added
 Any activity that generates a portion or all of a desired
constituent outcome.
 Things that customer believe have value.
Non-Value Added
 Any activity that is not generating the outcome desired by
the customer.
 Should be eliminated, simplified, reduced or integrated.
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Lean = Eliminating Waste
Time to process customer transaction
Value Added
Non-Value Added
Time from Customer presenting need until fulfilled
For manufacturing typically 95% of all lead time is
non-value added
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8 Wastes of Lean
•
•
•
•
•
•
•
•
Overproduction
Excess Inventory
Transportation
Waiting
Excess Motion
Non-Value Added Processing
Defects
Underutilized People
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Lean Implementation Building Blocks
Continuous Improvement
Pull/Kanban Systems
Quality at the Source
Standardized Work
5S System
Cellular Flow
TPM
Quick Changeover
Batch Reduction
Visual
Workplace
Teams
POUS
Office Layout
Value
Stream
Mapping
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Lean Government
What does increased productivity mean in
government workplaces?
What is the impact on Manufacturing?
What is the impact on Healthcare?
Lean Enterprise implementation increases capacity.
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Innovation Engineering
Innovation Engineering is a systematic process to
focus resources on creating value in new ways.
Create new services/products
Create new customers for existing services/products
Create new communication messages to customers
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It begins with a
Value Stream Map
Map value streams for key markets or
customers
 Determine performance gaps
 Define improvement projects
 Charter improvement teams
 Train, monitor, coach, continuously improve

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Office Current VSM Example
8 hrs/day, 150 orders/day
Avg. order has 5 line items
Information System
Supplier
Companies
ERP
ABC/Other
Companies
Daily
Mail Room
Clerical Entry
1 min./line item
Fax, Phone, Email Orders
Signal
Customer Service
Sort by Customer
Initiate/Review
45 sec./line item
Orders processed
within one day
Da
i

y
Confirm
Verify
Check product ID
1 hr. and Availability
1 min./line item
2 hr.
Notify Delivery or
Negotiate Change
1 min./line item
Fill Order
4 hr.
Pull product &
Enter in ERP
1 min./line item
Every
2 hrs.
4x’s
Daily
Ship Order
Package &
Arrange Delivery
2 min./order
20%
2 hr.
Buyer
Check Supplier
Availability
5 min./line item
3 hr.
Purchase
Payment
Issue P.O. Send
to Supplier
5 min./line item
12-72 Verify Packing list,
hr. P.O., Issue Check
5 min./line item
Receive/Inventory
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Verify Deliver &
Put in Stock & ERP
5 min./line item
w/i 30 days
Office Current VSM Example
3 hr.
1 hr.
3.75 min.
5S
5 min.
12 - 72 hr.
5 min.
5 min.
Teams
2 min.
Link Processes
Balance Workload
Standardize Work
Kanban Suppliers
Takt
(Pitch)
18 – 78 hr.
20.75 min.
2 hr.
Buffer Resources
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Form U-Shaped
Cells
Cross-Functional Process Map
Sales
Marketing
Engineering
Customer
Needs
Opportunity
Defined
Review
and Plan
Evaluate
Review Options
Product
Concept
Procurement
Manufacturing
Final
Product
Prototype
Process
Feasibility
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Set Price and
Rollout
Readiness
Material, Tooling
O.S. Services
Production
Office Future VSM Example
ABC/Other
Companies
Supplier
Orders
150 orders/day
8 hours/day
Avg. order has 5
line items
2 CELLS
Purchase
Da
i

y
Rec. & Fill
Orders
Ship Order
Payment
Cust. Service
3 CELLS
From: 14 People & 2.3 to 9.8 shift leadtime
To:
14 People & 1.3 shift leadtime target
Some? – Target 2 hrs.
Supermarket - Target 8 hrs.
23.75 min. per order
10 hrs./order max.
35.75 min./order
12 min. per order
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Measuring the Impact
Attribute/
Metric
Current State
Performance
Future
State Goal
Leadtime
43 days
20 days
First Pass Yield/
Reworks
56%
80%
Processing Time
122 hours
100
hours
Etc.
Etc.
Etc.
Actual
Results
Measured
Value
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Six Sigma Defined

A disciplined, problem solving methodology
for continuous improvement using statistical
techniques to improve process capability and
eliminate VARIATION

Rigorous application of the DMAIC process in
solving problems
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DMAIC Problem-Solving Tollgate
Process
Define
Charter
•Problem
Statement
•Scope
•Business Case
•Team
•Goals
Measure
Analyze
Improve
•Data
•Identify
collection and possible causes
display
•Narrow to
root cause
•Identify and
test solutions
•Refine and
pilot solutions
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Control
•Control plan
•Close and
hand-off project
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Primary Six Sigma Tools
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
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DMAIC Process
Charter
QFD
Fishbone
Root Cause
Brainstorming
FMEA
Gauge R & R
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
DOE
Hypothesis Testing
Regression
ANOVA
Histograms
Benchmarking
Control Charts
CTQ
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Where Do I Begin?
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Project Prioritization Matrix
1. Low Effort / High
return
3. High Effort / High
Return
2. Low Effort / Low
Return
4. High Effort / Low
Return
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Project Prioritization Matrix
1. Low Effort / High
return
2. Low Effort / Low
Return
3. High Effort / High
4. High Effort / Low
Kaizen –
Return Rapid Improvement Return
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Project Prioritization Matrix
1. Low Effort / High
return
2. Low Effort / Low
Return
DMAIC
Projects
3. High Effort / High
Return
4. High Effort / Low
Return
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Grand Rapids, MI
•
1700 employees
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15% reduction in employees due to revenue decline
•
Lean gains improved productivity but did not offset
reduced available capacity
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“provide quality of service …, in less time and with
less effort and frustration”
•
“engage staff members responsible for the work in
redesigning it”
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Clarence, NY
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100 employees, $20 million budget
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Trained 20 employees in basics, 2 Green Belts
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Use volunteer business advisory group
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Project to capture additional $86,000 in park
facility usage
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Project reduce meetings and employee hours on
large community development projects
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Q&A
Missouri Enterprise
A Private, Not-for-Profit, Public-Private
Partnership
Corporate Headquarters
900 Innovation Drive, Suite 300
Rolla, MO 65401
800-956-2682
Visit us at www.MissouriEnterprise.org
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