No matter what your knowledge of Lean Six Sigma, come join us in a one hour lively discussion on “11 ways to Sink Your Six Sigma Project.” Master Black Belt Peter Bersbach will give an overview of each way, then open the session to a discussion on how to avoid that particular failure mode. No ideas are wrong, but we will learn different approaches we might use to avoid each of the 11 ways and have a very successful project.

1. Poor Project Selection
2. Defining Defects
3. Training Variation
4. Statistical Training
5. Shoddy Certifications
6. High Attrition Rates
7. Relying on GEMBA
8. Tool Application
9. Sustaining Results
10. Estimating Benefits
11. Six Sigma or Lean

Update:
Click here to view the recording of the webinar 11 ways to sink your six sigma project. Length 44:17. This was a great webinar with a lot of input from the audience.

The questions you are asking regarding “Where do these statistics come from?” require entire courses in statistics to answer. In Lean Six Sigma we take information from a dozen or so statistics courses, project management courses, psychology courses, business courses, mathematics courses, etc. and put it into an action framework that can be used to make fast improvements. We probably present less than 10% of the information you would receive if you sat through all of these courses, but we do so in less than 5% of the time it would take to complete all of these courses. It’s a tradeoff. We make the greatest compromises in the field of statistics. We discuss the use and interpretation of a select subset of statistics, and answer the question “where do these statistics come from?” by saying “they come from computer software.” While most are satisfied with this answer, some find the answer to be most unsatisfying. Judging from your questions, I suspect you are in the latter group.

Two-Way ANOVA Calculations from E-Handbook of Statistics

Assuming you don’t have the time or the desire to take all of the courses relating to the Lean Six Sigma body of knowledge, but still seek answers to the specific statistics you asked about, I recommend the E-Handbook of Statistical Methods. This reference source is free and very comprehensive. It’s easy to search and will give you the answers you seek. For example, I searched on the term sum of squares, which you asked about, and the search returned pages on the half-normal probability plot (your question about fig. 10.26,) 1-way ANOVA (several of your question were about these calculations,) and several other related topics. A search on ss interaction provides answers to your question about the calculation of this intermediate statistic.

Sorry I can’t address all of your questions via email, but perhaps the reference above will start you on your way to answers. I had the same questions when I started learning about quality improvement nearly 45 years ago, and I am still looking for answers to questions today. Have fun!

Tom Pyzdek

Click the link below to reserve your seat for this webinar.

Wednesday, January 18, 11:00AM EST. Click here to register.

Click here to view a recording of the webinar.

True enough, but not the whole story. The fact is that when I look at what my clients do with Lean Six Sigma, and review projects from students, I can see that they are, in fact, innovating. In Phase I, when companies begin Lean Six Sigma, it is usually viewed as an initiative and the first efforts focus on creating a culture where change is possible, organizing an infrastructure for change, training a cadre of part- and full-time change agents, and pursuing projects chosen to move the organization towards its vision. This sets the stage for innovation. The real transformation here is in the way people in the organization think, specifically:

• They are fact and data driven. Opinions are considered the source of hypotheses to be tested, not absolute truth. The change agents have the tools they need to rigorously test these hypotheses.
• They are customer focused and they know how to identify the voice of the customer. This gives them insights into customers needs that go well beyond what customers explicitly say their needs are.
• They think of organizations as processes as well as functions. They understand that functions exist to serve stakeholders and enable core processes.
• They understand variation differently than their untrained counterparts. They know that some variation demands an immediate response, but other variation requires system changes. They know how to tell one type of variation from the other.
• They think of results as stemming from systems rather than individuals.
• They know that outcomes–both wanted and unwanted–are caused, and they know how to drill down to these causes. I.e., they understand that processes are transfer functions that transform inputs into outputs.
• They understand the importance of focusing on the few critical to quality drivers, and how to identify them.
• They know how to organize people for change.

By design the time spent as a full-time change agent is limited. Black Belts serve their terms and return to the organization in other roles.  As time goes by these Lean Six Sigma change agents begin to change the organization’s DNA. Phase II occurs as the culture change takes hold and the change agents, now in key leadership positions, see the Lean Six Sigma approach as the best way to lead the organization towards its vision. They see that they can create new and innovative ways to serve their customers’ latent needs based on the intimate knowledge of the customer and the insights gained using Lean Six Sigma on a smaller scale. They better understand the organization’s capabilities based on experiences learned during the deployment of the initiative. Lean Six Sigma moves far beyond discrete improvement projects and becomes the  framework for leading the organization as a whole towards its vision.

Lean Six Sigma also teaches leaders a new way to lead. Their involvement in defining the organization’s core processes and enabling functions, identifying process owners, finding opportunities for improvement linked to their strategies, defining the drivers of these opportunities, selecting relevant metrics for the drivers, and linking the metrics to activities throughout the organization (including but not limited to Lean Six Sigma projects,) gives them a new way to get things done.

The combination of a new way of thinking, intimate knowledge of the customer, a culture that embraces and expects change, and a powerful new way to lead, makes it possible for the leadership to bring together disparate parts of their organization all focused on a single purpose: wowing the customer. In short, innovation. This is not the aforementioned clumsy and ill-advised attempt to measure the unmeasurable or to “manage the innovation process,” it is an inspired expansion of the scope of Lean Six Sigma from a purely operational improvement tool to a purposeful search for innovative improvement opportunities. It is the application of the core principles of Lean Six Sigma to the  problem of creating a resilient organization that not only responds quickly to changing customer needs and competitive pressures, but also improves the human condition by creating products and services never before conceived.

In summary, Lean Six Sigma becomes the springboard for continuous innovation. It’s a natural extension of the idea of continuous improvement.

“We provide safe and clean stores along with first-to-market products and exceptional customer experiences,” Dennis Folden, COO, told CSP Daily News. “That’s why we are able to ensure continued loyalty from our customers. Specifically, Six Sigma, continuous process improvement and a ‘passion for excellence’ are not easily replicated.”

Margins in the retail industry are extremely tight, so every penny counts. Lean Six Sigma is a way to identify opportunities to eliminate waste, unwanted variation, and errors in retail business processes, all of which cost money, add no value for customers, and don’t contribute to the bottom line.

Although Lean Six Sigma’s roots may be in manufacturing, it has been applied in a wide variety of other industries and businesses. If there is a repetitive process involved, the approach can be used to improve it. A retail chain serving millions of customers from hundreds of stores has many such processes. Lean Six Sigma helps first by getting people to understand their business from a process perspective. Most managers who are trained in traditional business schools are taught to view the business as a set of functions, such as marketing, purchasing, human resources, etc.. But customer value is created by processes, not functions. When processes are examined with Lean Six Sigma opportunities for improvement often jump out from the analysis. For example, process maps may reveal a great deal of duplication of effort, or important tasks for which no one has clear responsibility, or confusing lines of authority. Lean Six Sigma’s super-effective DMAIC project execution framework provides a way to pursue these opportunities.

An unfortunate side effect of this emphasis is the proliferation of useless data. If the useless data weren’t used then collecting the data would merely be a waste of time. But if a person’s performance is being measured by this data, you can bet your last euro that the measurements will get a lot of attention, and it will drive a lot of behavior. And if the system doesn’t change, there’s still one way to make the measurements look better: cheat.

I often open my face-to-face training sessions with Dr. Deming’s Red Bead Experiment. It’s a great icebreaker and it introduces some important statistical ideas. The experiment is actually a game with very simple rules. “Willing Workers” are required to use a paddle with holes in it to sample beads from a container which has red and white beads in it. “We don’t want any red beads.” The workers are told. To drive the point home there are Quality Inspectors to check the samples for the unwanted red beads and to record the results, and Supervisors to use the results to “coach” and discipline the hapless Willing Workers. Before the game concludes there are always participants who, seeing a bunch of red beads on their paddle, quickly dump the sample back before the count can be made. Others deliberately pick out red beads and throw them back. Still others bring partially filled paddles to the Quality Inspectors. There are all manners of ways to try and beat the system. And this is just a fun game, played for no stakes at all. Imagine what people do when real consequences are on the line, such as pay and promotions.

The most serious games are probably paid in totalitarian countries where factory managers are measured and sometimes executed when the results are less than required by the authorities. According to the UK History Learning Site in Stalin’s Russia

Factories took to inflating their production figures and the products produced were frequently so poor that they could not be used - even if the factory producing those goods appeared to be meeting its target. The punishment for failure was severe. 

In the book Eat the Rich author P.J. O’Rourke tells us that in the USSR

The trouble wasn’t that factory managers disobeyed orders. The trouble was that they obeyed them precisely. If a shoe factory was told to produce 1000 shoes, it produced 1000 baby shoes because they were the cheapest and easiest to make. If it was told to produce 1000 mens shoes, it made them all one size. If it was told to produce 1000 shoes in a variety for men, women and children, it produced 998 baby shoes, one pump and a wing tip. If it was told to produce 3000 pounds of shoes it produced one enormous pair of concrete sneakers.

Perhaps P.J. is exaggerating, but the point is still essentially valid: metrics can–and probably will–be gamed. In Lean Six Sigma there’s a common metric gaming activity which I call Denominator Improvement. One of the most popular metrics is defects per million opportunities, or DPMOs. The formula itself is quite simple: DPMO = 1,000,000 x Defects/Opportunities. If someone’s performance is being measured using DPMOs they can make the metric look better by reducing defects (the numerator,) or by increasing the number of opportunities (the denominator.) For example, we might be interested in the number of typing errors in this post. The DPMO metric might be 1,000,000 x Errors/Total Words. But if this number didn’t look good enough I might also use 1,000,000 x Errors/Total Letters or 1,000,000 x Errors/Total Characters, counting spaces and punctuation.

The solution to metrics gaming is to use metrics to guide improvement, not to measure the performance of people. Metrics should be limited to those numbers that quantify an important outcome (Y metrics,) or quantify an input that is critical to the quality of the outcome (a CTQ or X metric.) The reason for quantifying these things is to discover, validate, and use a transfer function — Y=f(x), a model of the cause-and-effect relationship — to guide improvement planning and activity. When metrics serve a useful purpose such as this the tendency to manipulate and game them is, if not eliminated, at least reduced.

• Lean cannot bring a process under statistical control
• Six Sigma alone cannot dramatically improve process speed or reduce invested capital
• Both enable the reduction of the cost of complexity

The Army’s deployment is one of the largest anywhere. The Army’s Lean Six Sigma program has trained more than 1,450 senior leaders. As of the date of the report on their web site, the Lean Six Sigma community has completed nearly 5,200 projects, and more than 1,900 projects are currently in progress. Completed projects have yielded significant financial and operational benefits at organizations across the Army.

The Army’s use of Lean Six Sigma is part of its effort to transform the Army through the establishment of the Institutional Army Transformation Commission in August 2011. The Secretary of the Army, John M. McHugh, established the Commission in a Memorandumon 15 August 2011. According to the Secretary, “reforming and restructuring the Institutional Army – the Generating Force – is critical to building the Army of the future and supporting the forces of today. It must be as nimble, agile and adaptive as our Operating Force – driven by ideas, innovation and a determination to bring the best services and equipment, training and leaders, medical care and support to our Soldiers, civilians, and their family members.”

I think its safe to say that creating an organization that is nimble, agile, adaptive, driven by ideas, innovation, and a determination to bring the best are all goals that any leader can embrace. I believe that the Army is correct in believing that Lean Six Sigma can help them achieve these goals.

Military logistics operations are centered on providing the best possible service to their customers. Ensuring the best possible service to soldiers downrange is the priority of every logistics leader. One deployed unit is providing their soldiers an opportunity to learn new ways to improve logistic capabilities. The Task Force Resolute command provides a Lean Six Sigma course at the U.S. Forces Afghanistan conference room on Kandahar Airfield, Afghanistan.

“Through Lean Six Sigma, soldiers and leaders will learn how to properly manage time and resources while delivering a top quality product the first time,” said Chief Warrant Officer Jackie Vuorinen, the TF-Resolute safety officer. “This is a program all soldiers can use to save Army resources while providing higher quality products.”

It’s only natural that the Task Force Resolute command use Lean Six Sigma. After all, providing military logistics is a complex process and, like any process, it can be improved. The current best practice for improving complex processes is Lean Six Sigma. Soldiers are being taught the Lean Six Sigma Green Belt body of knowledge. The most fundamental principal taught by the “Green Belt” course is to center the students thinking to several key concepts: define, measure, analyze, improve and control.

The soldier begins by defining a need within their organization centered around quality, cost or timing. The need must be clearly stated through a quantifiable unit such as units shipped, number of products delivered in a sub-standard state or the amount of time it takes to bring a product to the customer. soldiers measure all their statistics through historical data. The data is analyzed and the implications of faults within the organizations system are used to determine methods of improvement. These methods are implemented and used to create a steady improvement in service to the end customer.

Perhaps the effectiveness of the approach is why, according to the DVIDs website story, that students strongly recommend the course to all leaders and soldiers. In truth, this is the standard Lean Six Sigma approach applied in the context of military logistics. Let’s hope that the word spreads.