Pyzdek Institute » deployment

U.S. Army Embarks on Improvement Using Lean Six Sigma

Thomas Pyzdek — Thu, 29 Dec 2011 19:42:02 +0000

The United States Army’s Office of Business Transformation is pursuing a 3 year program to improve its operations, and Lean Six Sigma is a big part of it. According to its web page on Lean Six Sigma, the Army has an award-winning, world-class Lean Six Sigma program that it applies as a core capability in its business transformation. The Army is reviewing core business processes to better support its forces, to reduce waste and to improve quality. The ultimate goal is to free human and financial resources for more compelling operational needs. The Army believes the fusion of Lean and Six Sigma improvement methods is required because:

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.

Lean Six Sigma Improvement and Work Design, Part 9

Thomas Pyzdek — Mon, 09 Aug 2010 07:10:29 +0000

This is the ninth post in a series taken from a lesson in Pyzdek Institute Lean Six Sigma Black Belt training. Future posts will continue the topic. You can find all of the articles in the series by searching this site for the title.

How can we keep the workplace safe, clean and organized? (5S)

The standardized approach to work is completely dependent upon maintaining discipline in the workplace. Procedures are useless if they are not maintained and followed. Change is not only inevitable, it is desirable and pursued continuously. When favorable change has been discovered it is made part of the standard.

The workplace itself is the physical manifestation of the standard. It includes the materials, equipment, and tools needed to do the work according to the standard. It does not include anything that is not needed. Just as the work cell is laid out to produce maximum efficiency, the details are also arranged to achieve this goal. The necessary tools are placed where they can be easily and immediately accessed when needed. Strict housekeeping is enforced to assure that clutter is non-existent; clutter is not needed to do the work, so it is to be eliminated. In Lean Six Sigma the system used to create and maintain an efficient, clutter-free and clean workplace is known as “5S.” 5S. 5S is the starting point for Lean deployment. 5S stands for Sort, Set in order, Shine, Standardize, and Sustain. These terms are defined as follows:

Sort. Clearly distinguish what is necessary to do the job from what is not. Eliminate the unnecessary.
Set in order. Put needed items in their correct place to allow for easy accessibility and retrieval.
Shine. Keep the workplace clean and clear of clutter. This promotes safety as well as efficiency.
Standardized cleanup. Develop an approach to maintaining a clean and orderly work environment that works.
Sustain. Make a habit of maintaining your workplace.

Sort

Earlier in the training we focused attention on process steps and operations activities that were non-value-added. The same search for waste occurs with 5S during the Sort phase. Sort means that you vigorously search for items in the work place that are not needed to perform the value-added work being done. This is much more difficult than it sounds. People tend to want to hold on to things “just in case” they are needed at a future time. This mentality is an artifact that results from the pre-lean era when unforeseen problems–for example equipment failures, quality defects, bottlenecks, etc.—created such needs. This hoarding behavior results in the accumulation of things that are not needed in the well designed lean work cell. They take up space which is needed for production and they get in the way of smooth movement within the work cell.

Red-Tagging

To deal with the “we may need this later” mentality, and the general uncertainty regarding what is and is not needed, it is best to proceed by placing an item in a holding area before discarding it completely. In Lean Six Sigma this is done by using red-tags. When a red-tag is placed on an item the team is asking three questions:

Is this item needed in this work cell?
If the answer to #1 is yes, is it needed in this quantity?
Does this item need to be located here?

Items that are red-tagged are considered one-by-one and one of the following actions is taken:

They are left where they are.
They are moved to another location for storage.
They are held in a local red-tag holding area for a specified period of time to see if they are needed or not.
They are disposed of, i.e., thrown away, sold, used elsewhere in the company, or moved to a central red-tag holding area.

If large equipment is red-tagged it should be handled as described above if possible. If the equipment can’t be moved it can remain where it is for a while, but it should be removed when it is determined that it is not needed where it is.

The results of the red-tag effort should be documented to show the value of the effort. It is not uncommon for companies to postpone or scrap plans to add facility space after seeing the amount of floor space freed as a result of the red-tag program. This is the infamous “hidden factory” made visible.

A Quality Lexicon

Thomas Pyzdek — Thu, 02 Jul 2009 18:11:51 +0000

Let’s define those buzzwords we use every day.

In the deployment of six sigma, we usually begin by defining our terms. I must admit to negligence in this regard, because I haven’t yet defined for you what I mean when I write about “quality.” As this definition is at the root of all of our discussions in one way or another, it deserves and needs to be stated in explicit terms.

Let’s start at the beginning: ethics. Most of us feel that quality is important because it’s “right” at a fundamental level. Conversely, failing to provide the best possible quality is considered somehow “wrong.” These feelings of right and wrong are implicit in discussions of quality and are the source of heated debate between quality practitioners and others. But feelings aren’t tools of cognition; they’re automatic responses based on previous conclusions. As such, they may be in error. If feelings are to provide a useful guide for behavior, they must correspond to reality. Let’s see if we can validate the feeling that quality is “good.”

Productiveness and honesty are the moral virtues upon which the concept of quality is based. Productiveness is the process of sustaining your life by using your mind.1 Most of us spend a substantial percentage of our waking hours engaged in this pursuit. Productive work is the central purpose of rational people’s lives and the central value that integrates and determines the hierarchy of all of their other values. Reason is the source, the precondition of a person’s productive work. Pride is the result. Productiveness involves reshaping the world in the image of one’s own values. Honesty is the refusal to fake reality to acquire value. When managers know how to provide greater quality but fail to do so, they are being dishonest. Employees who fight to keep jobs that are no longer needed, or who fail to perform their jobs to the best of their ability, are likewise being dishonest.

With these terms defined, we’re ready to define quality: Quality is the value added by a productive endeavor.

Quality comes in two flavors: potential and actual. Potential quality is the known maximum possible value added per unit of input. Actual quality is the current value added per unit of input. The difference between potential and actual quality is waste. Waste, we all know, is bad, and now we know why it’s bad: It’s dishonest.

Quality science is the attempt to increase potential quality through mental and physical effort. It’s the systematic search for knowledge of productivity improvement. It may involve creating more value with the same resources, creating the same value with fewer resources or creating entirely new values.

Quality improvement is the process of increasing actual quality through mental and physical effort. This can be done by either reducing waste or developing new systems that increase both actual and potential quality. Because quality is value-added, it can be measured for any process that adds value.

In any enterprise, all stakeholders engage in a value exchange. Employees exchange their labor and ideas for monetary compensation in the form of wages or bonuses. Owners exchange their investments for a financial reward. Managers exchange their organizational and planning systems for monetary compensation. Customers exchange their money for the benefit they derive from the product or service.

These value exchanges are based on the belief that other parties in the exchange are performing to the best of their abilities. Investors assume that management utilizes the assets entrusted to them in the most effective way they know. Owners expect management to look for better ways to utilize the organization’s assets. Management assumes that employees will, to the best of their abilities, do the jobs they are paid to do and offer suggestions for how the job might be done better. Employees assume that they will be rewarded commensurately to the value they create. Customers assume that the products and services provided are the best the company can produce consistent with the rightful interests of the owners, managers and employees.

Because everyone knows that these assumptions are held by the various parties, any departure from them is dishonest unless the departure is made explicit. In short, all stakeholders are entitled to receive maximum value from any exchange.

The rate of exchange for these values is established by the market. The market’s moral function is to establish an honest rate of exchange. This is what we mean when we say that inefficient producers or producers of shoddy merchandise are “punished” in the marketplace. Ultimately, in a free market, reality determines the value of an exchange. Dishonesty (i.e., creation of a fake reality) is impractical in all its forms, including poor quality. When poor producers suffer in the marketplace, it isn’t punishment–it’s justice.

1 . Definitions of philosophical terms discussed in this column are from The Ayn Rand Lexicon: Objectivism from A to Z, edited by Harry Binswanger (www.second renaissance.com).