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A Case Study on Improving Productivity

by Reducing Operation Cost as Six Sigma
Process Improvement

Keywords: DMAIC, FMEA, KPI Dash Board, NVA, Pilot Verification, Root
cause Analysis, Risk Analysis, Six sigma process improvement,

This case study illustrates the application of six sigma process improvement to productivity
improvement in manufacturing process.

To ensure sustainable profitable growth in a highly price-sensitive appliance
market Cost reduction through operational excellence is the key
imperative. Elin Appliances upgrades can often be justified in terms of savings
due to increased productivity. However, in a Six Sigma organization, the
DMAIC Method & host of tools can be used to improve productivity through
process improvements.

Six Sigma DMAIC
Six Sigma is a quality improvement program that looks at processes with a
view to analyzing process steps, determining what process elements need
improvement, developing alternatives for improvement, then selecting and
implementing one. It relies on a variety of qualitative and quantitative tools,
emphasizing the use of data and statistical analysis with in a method called
DMAIC, an acronym for the names of its five phases (Define, Measure, Analyze,
Improve, and Control) (Table 1). Six Sigma projects are typically selected for
their potential savings in improving any process, whether it is in production,
administration, engineering, or services. A Six Sigma project typically begins
with a high level definition of a process, using a diagram to specify the process
boundaries, inputs, outputs, customers, and requirement. In the measure phase,
a process metric is selected and used to baseline the current performance of the
process. In the analysis phase, the process is analyzed, usually with a process
map and a failure modes and effects analysis (FMEA), but may include other
types of analysis. The process map shows each process step with its inputs and
outputs and provides the basis for either a FMEA or a quantitative, usually
statistical, analysis. Areas for improvement are pinpointed and alternatives
are generated and evaluated. Once an improvement option is selected and
implemented, the project enters the control phase. In this phase, a plan is
established for monitoring and controlling the process to ensure that gains are
The use of the DMAIC method may vary between projects. For example,
the Measure and Analyze phases of this project ran concurrently rather than
150 Elin Appliances

sequentially. leading to an emphasis on planning and implementation in the Improve phase.18 70 _ X=66. and implement a solution. Define Phase As per “Voice of the Customer( VOC )”. To meet customer requirement cost reduction is the key driver for profitable growth. Also. Analyze . Baseline Process Capability Process mapping data for Problem statement – Throughput time: Data collected for all assembly lines I Chart of throughput time for Steam Iron 110 1 1 11 1 11 11 11111 1 100 1 90 Throuput time 80 UCL=75. Estimated losses in factory due to poor productivity exceeded 100 K Euros in 2006-2007 financial year 2. Measure Phase 1. Measure -Analyze the current process and specify the desired outcome. validate.83 60 LCL=58. Check data Quality 5.Prioritize solutions. Consequently. a proposed solution may emerge early in the Measure and Analysis phase.Develop a plan for measuring progress and maintaining gains. Understand Process behavior 6. The Flow through M-Phase- 2. Develop process measures 3. DMAIC Method for Process Improvement Phase Steps Define . Productivity improvement would generate hard and soft savings.48 11 1 1 1 11 1 11 1 1 1 1 50 1 1 1 111 1 11 40 1 11 21 31 41 51 61 71 81 91 Observation Improving Productivity by Reducing Operation Cost as Six Sigma Process Improvement 151 . Table 1. Problem / Opportunity statement 1.Identify root causes and proposed solutions. select. Improve . Control . plan.customer products should have price stability & products should be competitive in pricing. Collect Process data 4. Such was the case in the Productivity Improvement project. this paper focuses on the Measure and Analyze phases in which a simulation based on a process map provided the justification for Productivity Improvement.Identify an opportunity and define a project to address it.

JMG 180 160 Cycletime in seconds 140 120 100 80 60 40 20 0 l y x PE l et ua itch ing ing n.LEDI 2500 Cycletime in seconds 2000 1500 1000 500 0 l ing ing ing t e ing ing ing na ing ing ing ing ing s t g G g n ck g s t g x x t t fix p pla nt fix fix mi fix fix fix ut fix t e at in KIN o lin itio he nin i ru k in Bo Bo se t e e e o u w p e r w d g ro y ty he EC Co po s a l c cle a nt pac in A h A ld bk r k y p m re m .5 4.July'07 60000 100 Time in minutes 50000 80 Percent 40000 60 30000 40 20000 10000 20 0 0 y ed s ms er Fact ors causing line st oppage alit ilab le w n ssue h qu va issu ak d o i b le Ot nt t a n ot re w er p ro e o b o ilit y on tn kit ine Manp Ut mp en ch Co on Ma mp Co Count 2887717320 2845 2545 2270 1605 1699 Percent 50.41 Through put time 45 40 _ X=37.0 100.43 35 30 25 LCL=24. t dy ysc n la ut sc s c o u Co Sa Pre p C o f is u a & c o x e t c in o d o n g ain H m n &v v is ring Fa n f b W Ro t al r fix B Bo N e Sq thin M Te & o in g ke g e ve r g n ic t in M o Ea in a st t lc fix Cle Pu al ta Di Me Work stages.2 97.0 2. I Chart of throughput time of Juicer Mixer Grinder 55 1 1 1 50 UCL=50.1 n.0 Component having high Quality issue 152 Elin Appliances . t re o r sin rd Inla fe H f u l A y g co ary o v e g.3 5.8 90.8 3.0 Cum % 50.8 85. Root cause analysis of line stoppage Pareto of Line stoppage factors for period Jan'07.5 80. there is wide variation in process through put times Cycle Time Study of Line Chart of Cycletime vs Work stages.2 94.JMG Assembly lines are highly unbalanced due to no value added content.5 30.LEDI Chart of Cycletime vs Work stages .0 4.2 ing fet ing ing ing ing ing ing bo l vis sw r fix ous c on c on fix S a atch atch lean ack ber ack cy p T A Pa sing eed oto op h ir e ir e ttom e m rm c g p um r p Fan op a N f e B u Sp M &t w w Bo v a b f ho le Si e J ly Bu le dd po dd Mi Mi Work stages .45 1 4 7 10 13 16 19 22 25 28 Observation As per data.

bottleneck Analyze Phase The flow through A-phase 1. Analyze data using process stratification 3. Verify root causes with test data Solution selection process Generate solution ideas Evaluating criterias Select solutions determine cost benefit Verify solutions with tests & data Map new process Improving Productivity by Reducing Operation Cost as Six Sigma Process Improvement 153 . Non valued WHY WHY WHY WHY WHY No.Why analysis of Non Value Added activity on line S. Determine potential root cause to measure 2. added stage 1 Toaster cooling time Heat dissipation Is not Cooling Design of cooling stage properly controlled equipment equipment is not deficiency optimised 2 Sieve matching Selective assay To check for noise and Unbalanclng of Interaction effect of specs of and jar matching process vibration sieve components components not optimised 3 Iron cooling stage Cooling time is high Uniform cooling is not Iron farthest from Iron coding is cooling happening fan takes longer influenced by arrangement time to cool ambient conditions Is adequate also 4 Preheating stage Has to go through 3 This is a to ensure iron Requirement Reliability of cold Cold setting heating cycles attains steady state for 100% temp setting process validation Inadequate 5 Packaging and line Packaging stages are Manual and too To many items in Packaging cleaning not balanced many offline packaging design design not activities simple 6 Pop up testing time at the testing Only four toasters can Testing Equipment is not stage be tested at a time equipment designed to line capacity is a speed.

High impact solutions selected against each problem statement Problem statement Problem statement Problem statement Line stoppage High NVA & TPT High TPT Remove hex screw Replicate steam Introduce conveyor iron cooling jig belt Recalibrate standard Automate cold setting process Strengthen engineering function at comaker Duplicate /repair moulds Temperature checking on sampling basis Standing working Plastic JMG collar Control Sieve unbalance <10 mg& motor coupler Enclosed chamber Within 0.1 mm run out Streamline material for powder feeding Increase capacity of pop up Jar assy relocation testing jig Near to comaker Automate RTV application Source sieve from Simplify packing and better supplier cleaning stages Implement phase The Flow through implement phase- • Assess risk using FMEA • Design implementation plan • Communicate to People • Pilot solution and track improved performance 154 Elin Appliances .

Control plan far cold setting process 3. proper design of material transfer trolleys 4 Sampling checking of Irons with high/ ow temp. High cycle times 2. Cold setting and nine stage in a con- temperature at nine Into market trolled atmosphere stage 2. Proper pilot. High wastages operate the machine. passing 1. show bench marks 3 Milkman feeder Material not reaching on main line 1. ControlonT1088 Aluminium composition Improving Productivity by Reducing Operation Cost as Six Sigma Process Improvement 155 . Preventive maintenance plan application b. Solution Failure mode Recommended actions 1 Conveyorisation a. Preventive maintenance plan 3. 2 Standing working a. Misalignment in speed 2. Breakdown 1. SOP for Job setup validation and how to c. Proper evaluation and release finished irons 2. Machine breakdown 1. 2. Proper routing plan on time. Proper design evaluation and release b. Introduce automation in cold setting process 5 Automation In RTV a. High fatigue levels below morale 1.No. 6 Deletion of antirust in Oxidation of soleplate in market 1.Elements of an implementation plan Overview of pilots Updating the business case & objectives Project plan The implementation plan Identifying resource requirements Budget/control Communication Dealing with resistance Risk analysis by FMEA Some of the high risks for solutions that were addressed through FMEA S. reconfirm working ergonomics during in operators pilot 2. have a proper communication plan to deal with resistance and change 3.

mental bafflers standing working 3.1 0 LC L=0 701 707 713 719 725 731 737 743 749 803 809 Week no 156 Elin Appliances .Training was provided. Reprogramming of m/c RTV application 2. revision of critical spares list 2 Oil shields in Jar 1 Paper caps not durable 1. make work instruction and 3. High wastage of RTV 1.6 300 __ 150 M R=132.T in minutes 1 500 U C L=516 _ X=165 0 LC L=-186 701 707 713 719 725 731 737 743 749 803 809 Week no b 1 a 600 Moving Range 450 U C L=431. 3. change into plastic caps pots 2. Fitment Issues 2. Pilot verification plan was used to modify the proposed solutions before implementation S. working ergonomics not 2. Operator needs training. one to one communication proper channels 3. Gradual phasing in of 2. Operator fatigue 1. proper capacity of compressors were incorporated in the design. lncrease table height The improved process-Primary metric unit/man hour Down time trend of Low end dry Iron b a 1000 Weekly D. Compressor not getting burnt 2. Misalignment of RTV 2. 4 Standing Working 1.No. modify dimensions 3. reduce nozzle dia dispenser with soleplate 3. Pilot on Pilot Verification Modifications done on Proposed solutions solution 1 Automation on 1. S Introduce cooling 1 Metal cover not cooling in 1. new failure points identified training 4. Addition of cooling fans jigs required time on top 2.

030 3 2 703 709 716 723 729 734 740 746 802 808 We e k no A B 3 Moving Range 2 1 U C L=0.Process mean improved with reduced variation Unit / man hour for Dry Irons(NDI/ODI ) A B Weekly unit/ man hour 6 U C L=5. to be monitored monitor 1 Unit per man hour Production manager Control chart & OCAP 2 TPTof main assy process Line supervisor Control chart & OCAP 3 Hourly rate of production for PPC manager Control chart & OCAP main assy 4 Line stoppage time Production manager Control chart & OCAP 5 DPMO Quality manager Control chart Improving Productivity by Reducing Operation Cost as Six Sigma Process Improvement 157 .772 __ M R=0.287 5 _ X=4.658 4 LC L=4.236 0 LC L=0 703 709 716 723 729 734 740 746 802 808 We e k no Down Time Trend Control Phase Implement permanent control methods • Track and confirm improved long term process capability • Standardize control plan • Identify leverage opportunities • Validate final financial results • Project handout KPI Dash board – The Process outputs to be monitored S. What are the Y’s Who will measure/ Control methods No.

Results of Project Financial Pulse 158 Elin Appliances .

Productivity (Measured in Unit per Man hour) Learnings from Project • A rigorous base line is important to define the improved state of the process • Never underestimate the power of Pilots for an effective implementation of solutions • It is important to build a critical mass of people who will build the change in the organization • An effective and consistent communication plan is the key for embedded change • Behind every good product there is a good process Improving Productivity by Reducing Operation Cost as Six Sigma Process Improvement 159 .