Archive for the ‘lean-six-sigma’ Category

Online Lean Six Sigma Black Belt Training Released

Monday, March 1st, 2010
Thomas Pyzdek

Pyzdek Institute President and Lean Six Sigma Instructor

New online product added to existing online and live courses
Tucson, AZ March 1, 2010 – The Pyzdek Institute LLC has added Lean Six Sigma Black Belt training and certification to its portfolio of online and live courses on  Process Excellence topics. The new course is written and presented by Thomas Pyzdek, author of The Six Sigma Handbook and numerous other authoritative works. “We have been teaching Lean Six Sigma to clients in live classes for well over a decade, and we’ve been teaching Six Sigma for much longer than that,” Pyzdek said. “But the ongoing economic crisis is causing a substantial increase in customer demand for online training, which provides significant cost benefits. In response we are creating online versions of our most popular courses. Online Lean Six Sigma Black Belt training is the most recent result of this effort, and we are very excited about it.”

Online Lean Six Sigma Black Belt training consists of 69 modules covering the entire Lean Six Sigma Black Belt body of knowledge. Pyzdek stated “When I developed this training I did my best to fully integrate Lean and Six Sigma into a comprehensive approach to Process Excellence. When I teach the subject in my live seminars I emphasize that Lean and Six Sigma are complementary, and I tried to make sure that this message also came across in my online training. I believe that I succeeded.”

Among major providers of online Lean Six Sigma training, the Pyzdek Institute’s online training is the only one to utilize the popular Moodle Course Management System. Moodle allows the company to carefully monitor the progress of all students, including lesson modules viewed, resources downloaded, assignment submissions, quiz results, and so on. With Moodle, when a student says that they have successfully completed their training, they can provide documented evidence to prove it. Moodle Powered Logo

Moodle also lets corporate customers monitor their students as they move through training. Students can communicate with their instructors or with each other via Moodle forums, which students find are great for interacting with and learning from Master Black Belts and from each other. By using Moodle, The Pyzdek Institute can create separate “Groups” of students. Each group can be coached by its own Master Black Belt and when members of the group communicate with one another, their communications are private and can’t be seen by those who are not in the group. This allows corporate trainees to share their learning experiences with others internally, without worrying about compromising proprietary information. For example, Coventry Health Care is using The Pyzdek Institute to provide training to students in Florida and Arizona, coached by a Pyzdek Institute trained Master Black Belt employed by Coventry. Companies can even coordinate the training of employees anywhere in the world. Corporations can save substantially via group discounts.

The company’s training program is also unique in that it offers three levels of recognition, Bronze, Silver, and Gold. “We found that people have different training needs.” Said Pyzdek. “If a company will be testing and certifying their  own people, then Bronze recognition is right for them and save them money. Silver recognition adds certification testing, and Gold adds certification project presentation to a board of Master Black Belts.”

In addition, The Pyzdek Institute is the only major Lean Six Sigma training provider to offer payment plans. Every online course provides the option to pay for the training over a period of several months.

Media Contact:
Thomas Pyzdek (520) 204-1957
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Lean, Six Sigma, and Lean Six Sigma Elevator Speech

Friday, February 5th, 2010

I teach that by itself Lean is a way to redesign a value stream according to certain principles to improve flow in a value stream, thereby reducing cycle time and achieving a number of other benefits quickly. Six Sigma has two modes: project and operational. The project mode involves a framework such as DMAIC or DfSS. The operational mode employs Six Sigma principles (management by facts and data, statistical thinking, systematic identification of root causes of outcomes, etc.) to achieve stakeholder goals. Lean Six Sigma can be used to provide a framework for kaizen bursts, or to solve other problems preventing continuous flow in an organization or value stream.

Hmmm…Upon re-reading this it strikes me that it’s full of jargon. Let’s try putting it into layman’s terms.

Lean helps you make things with minimal waste and delay. Six Sigma helps you find out why things vary and how to reduce variation. Lean Six Sigma helps you solve challenging problems causing waste and delay.

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Lean Financial Services

Friday, January 8th, 2010

The Wharton School and Boston Consulting Group (BCG) have released a special report investigating the reasons why the financial services sector is lagging in their adoption of lean tools and practices. The study finds that the attitudes are changing, albeit slowly. Apparently lower costs, fewer errors, improved efficiency and reduced cycle times appeal to bankers. Who knew?

Lean’s manufacturing origins are probably part of the problem. Non-manufacturing organizations have a difficult time making the mental adjustment between manufacturing and services terminology. I recall many years ago teaching a class where I presented a control chart of a manufacturing process. The data showed the diameters of truss rods. This was a public seminar and I had a mix of students from manufacturing, health care, insurance, services and other industries. These students were truly baffled as to how they could make this work with their businesses. Sensing the reason, I though I’d try something. I wrote the first few rows of the data table that was used for the control chart, but I didn’t put a title on the table. Then I went around the room one-by-one and asked the students some questions about their businesses. For the health care student I wrote the title on the table as “Infections per 100 Surgeries.” For the insurance student “Claims Processed per Worker per Hour.” For the service department student “Service Calls Requiring a Follow Up Visit.” As I addressed each student’s particular application, I could visibly see the light come on.

This exercise caused me to be somewhat disappointed in analysis presented by the Wharton/BCG report’s authors. Deepak Goyal, a partner in BCG’s New York office, commented “Finance is just a different kind of factory. It is a processing factory, and there’s a lot of waste.”  Another comment was “Becoming lean involves eliminating the “seven deadly sins” of waste in a process — overproduction, waiting, poor transportation/logistics, over-processing, sub-optimal inventory control, rework, and unneeded movement.” Yeah, sure. But I doubt that people in the financial sector know precisely what these guys are talking about. I suspect that a few specific financial sector examples of each type of waste would go a long way towards improving understanding. I mean, is it supposed to be obvious that sub-optimal inventory control is a problem at a bank?

Still, the report is a wealth of valuable information for those seeking to expand the reach of Lean to non-traditional areas. Those of us who are professionals in this area can glean a lot of useful guidance from the report, because we already understand Lean and Lean Six Sigma. We can add a great deal of value by translating the report into terms that our clients and employers understand so they can see exactly how these important process excellence philosophies and technologies can be applied to the processes in the financial sector.

Then, perhaps, the lines at the teller window and the waiting times for loan approvals won’t be quite so long!

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Six Sigma, Lean, and Lean Six Sigma

Monday, August 24th, 2009

Which process improvement approach is right for you and your needs?

People sometimes ask me to explain the difference between lean production and six sigma. The question is usually phrased something like, “Should I use six sigma or lean production methods to improve my operations?” Before I tell you my answer, let me provide a brief background on these different approaches to process improvement.

Lean production is based on the Toyota Production System and usually includes the elements shown in Figure 1. When properly implemented, a lean production system can dramatically improve productivity (by as much as 95 percent when compared with traditional batch-and-queue production systems).

Figure 1: Elements of Lean Production

Lean production dates back to the post-World War II era in Japan. It was developed by Taiichi Ohno, a Toyota production executive, in response to a number of problems that plagued Japanese industry. The main problem was that of high-variety production, required to serve the domestic Japanese market. Mass-production techniques, which were developed by Henry Ford to economically produce long runs of identical products, were ill-suited to Toyota’s situation. The lean approach (the term “lean” was coined in the early 1990s by MIT researchers) systematically minimizes waste–called muda–in the value stream. Muda includes all types of defective work, not just defective products. Wasted time, motion and materials are also muda.

OK, so how does this relate to six sigma? To make a valid comparison, we need a new definition of quality itself. By defining quality in terms of value rather than in terms of defects, we can see that six sigma quality involves a search for ways to reduce muda . I propose the following definition for six sigma:

  • A general approach to reducing muda in any environment
  • A collection of simple and sophisticated methods for analyzing complex cause-and-effect relationships
  • A means of discovering opportunities for improvement

The lean approach offers a set of solutions to muda in a high-variety production environment. Six sigma applies to the problems addressed by lean but also seeks to solve other problems common to production. However, because both six sigma and lean address the problem of muda, there is a great deal of overlap. The approaches should be viewed as complements to one another. Some examples of this synergism are shown in Table 1.

Table 1: The Synergy of Six Sigma and Lean Production

If you’re facing a situation where lean solutions can be used (e.g., high-variety production), you shouldn’t hesitate to implement lean: It offers proven solutions to known problems. Six sigma methods will help you with lean, and they will help you continue to improve when it’s time to move into administrative and other nonproduction areas.

Lean Six Sigma

A quick review of the above should make it clear that there is a natural affinity between Lean and Six Sigma. This has been incorporated into a single approach to business improvement: lean six sigma. Lean Six Sigma takes parts of Lean and parts of Six Sigma and puts them together in a single, integrated approach to achieving process excellence. Organizations can move from Lean or Six Sigma to Lean Six Sigma, or they can simply introduce Lean Six Sigma from the outset. If an organization is just starting the journey to excellence, I recommend the following:

  1. Begin with Lean. Identify value streams for the most important product families and move these as closely as practical to one piece flow based on pull systems.
  2. Examine the improved value streams to determine where obstacles exist to moving closer to one piece flow. These obstacles will generally be caused by excessive setup or changeover times, information flow issues, excessive variation, and other forms of muda.
    • Decide how best to deal with each obstacle on an issue-by-issue basis. Some can be remedied by “just do” projects, others by Kaizen events, others by routine continuous improvement activities, and still others by applying Lean Six Sigma

Of course, for most organizations conducting these improvement activities will require a complete transformation in the culture of the organization. But that’s the topic for another post!

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Activity Based Cost Accounting Hinders Lean Six Sigma

Friday, July 24th, 2009

In a recent post Bill Waddell tackles one of my pet peeves: activity based costing, or ABC. Few things do more harm to lean six sigma than this method of accounting. In fact, it is my opinion that the accounting systems used by American businesses are responsible for a great deal of our country’s declining economic prowess. Hindering improvement activities are just one example, but it’s the example nearest to my heart.

Let me give you one example to illustrate (it would take a book to describe all that’s wrong with ABC.) Let’s say we are trying to convince Mary that lean six sigma is a great idea. “Mary,” we say enthusiastically, “using lean six sigma will help you reduce inventory. Inventory is a bad thing. It takes up valuable space, it hides quality problems, it costs money to build it and it doesn’t generate any revenue…” Mary nods in agreement and tells us to stop badgering her with the obvious. Furthermore, she adopts lean for several important product families and her inventories drop dramatically.

Mary is likely to find herself out of a job if the company is using ABC. With lean six sigma Mary doesn’t make something until it’s needed by a customer. But if ABC is used a unit built for inventory is valued as highly as a unit built for delivery to a customer. ABC’s absorption accounting allocates overhead and other costs to units produced, why the units were produced doesn’t matter to ABC. Mary’s lean approach won’t look good, especially in the begining. Consider that Mary might begin with two months inventory. Depending on takt time, she may not need to produce anything for several weeks. It’s likely that Mary’s boss will pay her a visit with a message something like “Whatever the hell you’re doing, Mary, stop it. You’re killing my numbers!”

There are many other things wrong with ABC, and with the generally accepted accounting principles (GAAP) on which ABC is based. Considering that these accounting methods are taught to MBA students at our elite universities, we can only hope our economy survives our accountants.

Bill offers one alternative to ABC, which is described in a book called Real Numbers. Another is Throughput Accounting, which is based on Goldratt’s Theory of Constraints. Both methods are far more simple than ABC.

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Resources for Six Sigma


Introduction to Six Sigma
Six Sigma Projects
Six Sigma Tools
Six Sigma Statistics
Six Sigma Videos (Requires QuickTime)
Leading Six Sigma
Healthcare Quality
Process Excellence Podcasts
Other Useful Links
Good books on Six Sigma and other topics

What is Six Sigma?

By Thomas Pyzdek, Author of The Six Sigma Handbook

For Motorola, the originator of Six Sigma, the answer to the question "Why Six Sigma?" was simple: survival. Motorola came to Six Sigma because it was being consistently beaten in the competitive marketplace by foreign firms that were able to produce higher quality products at a lower cost. When a Japanese firm took over a Motorola factory that manufactured Quasar television sets in the United States in the 1970s, they promptly set about making drastic changes in the way the factory operated. Under Japanese management, the factory was soon producing TV sets with 1/20th the number of defects they had produced under Motorola management. They did this using the same workforce, technology, and designs, making it clear that the problem was Motorola's management. Eventually, even Motorola's own executives had to admit "our quality stinks." Read More...