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Introduction to Lean Six Sigma

Section 1: The Essence of Lean Six Sigma


Section 2: The Lean Six Sigma Methodology
Section 3: Why Lean Six Sigma Works

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Introduction to Lean Six Sigma

Module Objectives

In this module, we will examine Lean Six Sigma from a very high level. We’ll explain what Lean Six Sigma is, and
we’ll describe the role of the Lean Six Sigma Black Belt.

We will also study the methodology used in Lean Six Sigma, including: The powerful DMAIC, or D-M-A-I-C
process; which helps you systematically reduce variables to determine Y as a function of X. DMAIC is the
traditional methodology used for Six Sigma. With the addition of key Lean tools, it has become the standard for
Lean Six Sigma projects as well.

Finally, we will explain why Lean Six Sigma works so well for so many companies today.

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Introduction to Lean Six Sigma

Section 1: The Essence of Lean Six Sigma


What is Lean Six Sigma?

In order to understand what Lean Six Sigma is, we'll have you consider four questions. Imagine for a moment that
you're a department leader within your organization. As the leader, answer the following questions:

How hard would it be for you to identify your department's biggest problems? Think about it, and then choose your
answer from those listed in the column to the right. In general, company leaders know where their biggest
problems are, and can identify them easily.

After identifying your organization’s top problems, how hard would it be to assign your best people to solve your
biggest problems? Think now about some of your company's very best people. These are usually the individuals
who are keeping the business running on a day-to-day basis, and are already dealing with the daily fires
associated with your biggest problems. Hence, it's not so uncommon that leaders assign the best and brightest
individuals to the biggest problems within a business. These people are typically in short supply and high demand.

Now how hard would it be to provide the people you’ve selected with all of the tools, resources and management
support needed to fix your biggest problems? It's common that these people have some tools, resources and
management support available to them, but not enough, and not on a consistent basis.

Now how hard would it be for these people, armed with all of the tools, resources and support, to be granted
totally uninterrupted time to work and focus on your biggest problems? Because these individuals are constantly
putting out fires, it's next to impossible to guarantee them uninterrupted time to actually solve your biggest
problems once and for all.

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Introduction to Lean Six Sigma

Doing all of those things – that's the essence of Lean Six Sigma. Lean Six Sigma is about: Identifying your
biggest problems; Assigning your best people to fix these problems; Providing them with all of the tools, resources
and support needed; and lastly, but most importantly, guaranteeing them totally uninterrupted time to focus on
permanently eliminating these problems. Lean Six Sigma is about doing all of these things, doing them
consistently, and doing them well.

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Introduction to Lean Six Sigma

The Importance of Uninterrupted Time - Part 1

Let's look at the importance of uninterrupted time, the last point we just discussed. Intuitively, every manager
knows that if a person can focus on one thing at a time, then that person will be more effective. The probability of
success goes up, and the quality of the results will be higher.

So if everybody knows that uninterrupted time is the way to get things done right, why don't we do it? There are
many reasons. Let's investigate. At the heart of Lean Six Sigma is the concept of the Black Belt. The Black Belt is
an individual selected from amongst your very best employees, whose time is 100% dedicated to the application
of a structured problem-solving methodology for the purpose of solving your organization's biggest problems.

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Introduction to Lean Six Sigma

The Importance of Uninterrupted Time - Part 2

Meet Joe. Joe is trained to be a Black Belt. Joe's boss assigns him to tackle a Lean Six Sigma project full-time.
But Joe's boss is not the only one who thinks highly of Joe.

Click on each of the people around Joe to find out what typically happens during the time that Joe is supposed to
be working on his Lean Six Sigma project.

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Introduction to Lean Six Sigma

The Importance of Uninterrupted Time - Part 3

This is a familiar scenario. Everyone needs something from Joe. Joe can't concentrate on his Lean Six Sigma
project, which jeopardizes its success. While the plan was for Joe to dedicate a certain percentage of his time to
Lean Six Sigma, it just never really seems to happen.

For Lean Six Sigma to be implemented successfully, the entire company must embrace the philosophies of Lean
Six Sigma, and respect the need for uninterrupted time for Black Belts assigned to work on Lean Six Sigma
projects.

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Introduction to Lean Six Sigma

Uninterrupted Time - Firefighting

Meet Bill. Bill is a real firefighter. Day in and day out, Bill and his fire battalion fight fires. Then one day his boss,
the fire chief, says to him, "Bill, I'm sick and tired of this. Year after year we're out here fighting these fires, and we
never do anything about preventing them. From now on, I want you to spend your mornings fighting fires, and
your afternoons working on fire prevention by delivering community talks." Sounds like a fine idea, and coming
from the fire chief, Bill probably won't question it. But imagine Bill's schedule once he tries to take this from being
a good idea to reality.

On the first day, Bill does a fairly good job of making the fire chief happy. So far, so good. Imagine Bill on the next
day at noon, with a fire hose in his hand, looking at his watch and thinking, "I have to go do some fire prevention
talks at the local elementary school. Should I put this hose down?" But of course, he can't. The fire is still burning.
The midday fire does not care about Bill's scheduled afternoon talks. You can guess how the rest of Bill's week
goes.

The fires follow an unpredictable schedule, and what seemed like a good idea in practice, points to what in
retrospect is an obvious result. You see, when we say to somebody, "I want you to spend half your time
firefighting and half your time on fire prevention," the assumption is that that person is a good time manager, and
that they'll figure out how to get it all done. And maybe they are a good time manager. Unfortunately, when you
assign somebody to firefighting tasks, you effectively take away their right to manage their own time.

So it doesn't matter how good a time manager that person is. When you say, "spend 50 percent of your time on
Lean Six Sigma and 50 percent on something else," that 50 percent for Lean Six Sigma quickly becomes 40, and
30, and 20 percent. We just never get the time we were looking for.

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Introduction to Lean Six Sigma

Uninterrupted Time - Practice Makes Perfect

Meet Jane. Jane receives four to five weeks of Black Belt classroom training. That's more than 160 classroom
hours. It sounds like a lot of training time, doesn't it? But consider that the average college semester is generally
about 14 weeks times 15 credit hours, or more than 200 hours in the classroom. So while it seems that Black
Belts are getting a lot of training, and they are, that training is not even the equivalent of a semester at a university.

The training alone will not produce highly competent Black Belts. Hence, if Jane is not continuously practicing the
tools and techniques of Lean Six Sigma over and over again, she will never become good at it. Without Black
Belts dedicating 100 percent of their time to Lean Six Sigma, they cannot become experts in the application of the
methodology to real world problems.

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Introduction to Lean Six Sigma

Uninterrupted Time - Human Nature

Human nature is another reason why Lean Six Sigma must be embraced full-time at the Black Belt level.

Meet Mark. Mark has been assigned a Lean Six Sigma project. Mark is also regularly assigned smaller, one- to
two-hour tasks. Lean Six Sigma projects can sometimes take five to six months to complete. Occasionally it could
be even more. Some may be only weeks. But they are always viewed as long-term efforts.

If you were Mark and you had to choose between a two hour task and a two month task, what would more likely
tackle first? The little tasks, of course. Human beings are conditioned to want to get things done, and to show that
they're productive. And unfortunately, we never run out of two-hour tasks. Which means when we try to split our
time, we never really get to the longer-term tasks. This is yet another reason that Black Belts need to be assigned
to Lean Six Sigma full-time.

Now do you realize why the concept of a full-time Lean Six Sigma Black Belt is not just a little incremental
improvement in the way we manage people? It‘s a dramatic change in the management paradigm, and it’s critical
to the success of your Lean Six Sigma initiative.

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Introduction to Lean Six Sigma

The Right Tools and Resources - Part 1

We’ve talked about the importance of assigning your best people to Lean Six Sigma full-time. Now let’s talk about
all of the tools they will need to be successful. The example I like to use here is the Vise-Grip.

And I’ll ask an audience, “How many people in the audience have a pair of Vise-Grips in the garage?” (You know
Vise-Grips, Vise-Grips are those pliers with the spring in them so you can squeeze anything.) And most all hands
will go up. Certainly all of the guys are going to put up their hands and say, “yeah, I’ve got a pair of Vise-Grips in
the garage or in the kitchen drawer.”

The next question is, “How many times have you been told not to use Vise-Grips to turn nuts and bolts?” Why?
The answer is because you strip the threads. There’s not a good fit, you squeeze the threads, you have soft
metals. So we shouldn’t use Vise-Grips to turn nuts and bolts. But how many people use Vise-Grips to turn nuts
and bolts? Everybody says, “I do,” and the question is, “why?”

Very often it’s the only tool in the toolbox. You open up the toolbox and you’re fishing for a tool to do the job; you
don’t really have the right tool; the only tool that’s going to get the job done is the vice grips. So what we’re
constantly doing is force-fitting the problems we have to the tools that we have available and we know how to use.

It takes many, many years and thousands, or tens of thousands of dollars, before you have a full toolbox with all
of the right tools. And many more years of training before you’re a master mechanic and you know how to use all
of the tools.

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Introduction to Lean Six Sigma

The Right Tools and Resources - Part 2

When we train our employees, the traditional approach goes like this. We send one person to study process
mapping. Another to study root cause analysis. A third to study design of experiments, and yet a fourth to study
statistical process control.

The training is spread around so that a given individual obtains training in a limited number of tools. This is done
because we're trying to be fair. We're trying to ensure that we have all the necessary skills in the company. And
we're trying to avoid having one person out for too long at training.

When you approach training this way, don't be surprised if the person who knows only Statistical Process Control
tries to use that tool for every problem encountered. In every case, this person will try to find an SPC solution for
the problem - a new control chart perhaps. This is what happens when we have a limited tool set — we tend to
force-fit problems to the tools we've learned.

In Lean Six Sigma, we concentrate all the training on one person, the Black Belt, so that this person can turn to
the right tools at the right time to solve problems. Not only does the Black Belt learn to use many tools, he also
learns how to properly sequence the tools. That's a big change from the approach of training many people, each
on a limited number of tools. If we don't have Black Belts armed with a comprehensive toolbox, we can't create
master mechanics that are able to choose the right tool at the right time.

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Introduction to Lean Six Sigma

Section 2: The Lean Six Sigma Methodology


Data - The Driving Force

Before we discuss the Lean Six Sigma methodology, we want to make sure you understand that this methodology
forces us to make improvements through data-driven decision making. Although people frequently believe they
are making decisions using data, more often than not, they're using their intuition.

Organizations can take various approaches to data usage in driving problem solving. The approach used by a
particular company is related to the level of maturity of its problem solving methodology. These decision-making
levels range from using your intuition and going with a gut feeling, to qualitative and quantitative brainstorming
tools, to basic and inferential statistics.

To what degree does your organization use data in its daily decision making? Click on each level to view the
typical percentage of data-driven decision making utilized in an average organization. Press "Continue" to go on
with the lesson.

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Introduction to Lean Six Sigma

Let's Make a Deal! - Introduction

Let’s do a quick exercise. If you have a little bit of grey hair, you probably remember the old American TV game
show, “Let’s Make a Deal.”

As you may recall, a member of the studio audience would be called to the stage, where they’d find three very
large doors, typically the size of a garage door. Behind one of the doors was a big prize: a car, a boat, a vacation
trip to Hawaii, while the other two doors had gag prizes, such as 100 cans of Spam or a goat.

As a contestant on the show, you’d be given the opportunity to choose a door. After your initial choice, in an
apparent effort to help you, the host would open one of the remaining doors, revealing a gag prize. Now two doors
remain. At this point, you’d be given a choice: you could keep the first door you chose, or you could switch doors,
and have what’s behind the other remaining door.

Let’s see what you’d do if you found yourself in this situation.

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Introduction to Lean Six Sigma

Let's Make a Deal!

Welcome to "Let's Make a Deal!" It’s time to play, “Let’s Make a Deal!” Behind one of these doors is a brand new
car! However, behind each of the two other doors, there’s a goat. You will have a chance to choose one door, and
you will win the prize behind that door. If you are lucky, you could be driving home today in a brand new set of
wheels. However, if you choose one of the other doors, you will be taking home a new guest.

Let’s play! Please choose one of the doors.

You have chosen a door. But before we show you what is behind the door you have chosen, we are going to
show you what is behind one of the doors you have not chosen. Yes, we have eliminated one of the other
possibilities. Now that we have shown you what is behind one of the other doors, you have two doors remaining,
and you have a choice. You can stay with your current choice, or you can change your selection and have what’s
behind the other remaining door. What would you choose?

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Introduction to Lean Six Sigma

Let's Make a Deal! - What Do You Think?

This game illustrates a classic example of human nature. What do you think the odds are of winning the car if you
stay with your original selection, after the host has opened one of the remaining doors revealing one of the goats?
There are two doors left at this point.

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Introduction to Lean Six Sigma

Let's Make a Deal! - Solution

The right answer is 33 and 1/3rd percent. And would you believe that after the host has opened one of the doors,
the odds of winning the car increases to 66 and 2/3rds if you switch doors?

The initial perception is that after the host opens one of the doors that you didn’t select, the odds of winning
increase from 33 percent on any one door to a 50-50 chance on either of the two unopened doors.

However, the truth is that the odds are actually two to three in favor of winning the car if you switch to the
alternate closed door. How can this be?

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Introduction to Lean Six Sigma

Let's Make a Deal! - Analysis

A simple look at the possibilities proves that switching is the better deal. When you select a door, this determines
which of three possible situations you are in. Let’s assume you choose the first door. At this point, you have a one
in three chance of winning the car.

In this possibility, the car is behind the selected door, Door number 1. In the second situation, the car is behind
the first non-selected door, Door number 2, and there's a goat behind the door you have selected. The last
possibility is that the car is behind the second non-selected door, Door number 3, and again, there is a goat
behind the door you have selected.

There is a 33 percent chance of winning the car before the host reveals what's behind one of the other doors.
That also means that there is a 66 percent chance you will go home with a goat. In the first situation, the host can
open up either of the remaining doors, because they both contain a goat. In the second and third situations, the
host must open the only remaining door that contains a goat. Certainly you don't think the host would open up the
door with the car behind it, do you?

If we look at the odds of winning without switching, we only win the car 33 percent of the time. However, if you
switch, 66 percent of the time you will win the car. Therefore, the contestant should always switch. The moral of
the story is that our intuition tells us that there's a 50-50 chance of winning the car once the host has opened one
of the doors. In fact, the reality is that there is now a 66 percent chance of winning if we switch doors. All too often
we allow our decisions to be based on intuition. We must understand that sometimes, what seems obvious to us,
in reality, is much more complicated. Therefore, we must use solid tools and careful analysis to make the right
decision.

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Introduction to Lean Six Sigma

One of the goals of Lean Six Sigma is that we become much more data driven in our approach to decision making.
This is part of the long-term, cultural transformation we see from Lean Six Sigma. Lean Six Sigma is about data.

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Introduction to Lean Six Sigma

Let's Make a Deal! - Letters to Marilyn

In 1991, Parade magazine’s Marilyn vos Savant was asked the question, “In the situation presented in Let’s Make
a Deal, should one switch or should one stay?” Marilyn replied, “You should switch every time.” For those of you
not familiar with Parade magazine, it’s a magazine found at the center of most Sunday newspapers in the United
States.

Take a moment to read some of the letters that Marilyn received regarding this issue. It’s amazing how many
people insisted on believing their intuition, and not the data.

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Introduction to Lean Six Sigma

Methodology Phases [A]

The Lean Six Sigma methodology is composed of many phases.

Before we get into the details, familiarize yourself with each phase.

In the Define phase, we transform each opportunity identified into a clearly defined Lean Six Sigma project. This
means identifying metrics, objectives and timelines.

The Measure, Analyze and Improve phases are the heart of the problem solving process. These phases focus on
determining the relationship between key leverage variables and process outputs. This is characterized by
expressing the inputs and outputs of a process with a simple equation, "Y" is a function of "X."

The Control phase is the time for implementation of the solutions identified earlier. We track the results and
benefits of each Lean Six Sigma project. It's also the time to establish controls and accountabilities for the proper
operation of the process once the Black Belt moves on.

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Introduction to Lean Six Sigma

Systematic Variable Reduction - Part 1

One of the goals of the D-M-A-I-C process is to identify the most significant variables affecting the output or Y’s of
the process we're concerned with.

In the Measure phase, we open the door to all possible input variables, called X's, which could be the cause of the
problem, no matter how likely or unlikely the X’s appear to be. Often, Lean Six Sigma targets problems that have
been around for a long time. Problems that have been "solved" a number of times before, yet keep coming back.
Sometimes these are problems that are common to other companies in the industry. Though it's sometimes hard
to believe, occasionally the problem remains because we're looking in the wrong place for the solution. That's
because when we're in firefighting mode, we have to jump to conclusions; we have to guess at the two, three, or
four key variables that we believe are the cause of the problem; we don't have time to explore all of the
possibilities.

But with Lean Six Sigma, we make the time. We don’t let ourselves overlook or easily dismiss possibilities. In the
example shown here, there may be as many as 50 variables initially considered. The least relevant variables are
quickly filtered out using qualitative or simple quantitative tools.

In the Analyze phase, we take an uncommon approach. We begin to apply statistical analysis, which involves
looking for relationships between the X's and the output of the process we care about, called the Y. In this phase,
quantitative analysis further narrows down the field. Historical data is often used during this phase. We're working
toward the identification of the vital few X's, while weeding out the trivial many.

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Introduction to Lean Six Sigma

Systematic Variable Reduction - Part 2

During the Improve phase, we're looking to accomplish two tasks. First, we seek to validate that the X's remaining
on our list are the right X's, or what we often refer to as the key leverage variables. Second, we try to figure out
what the optimal solution to the problem is and what settings in the process will yield the very best performance in
the future.

By the time we conclude the Control phase, we hope to narrow our list of key leverage variables to only two or
three, perhaps as many as five critical input variables. There's a well-supported rule of thumb that suggests that
85 percent of the variation in any process is controlled by two to five critical X's. The problem is, we don't usually
know what those two to five critical variables are, so we try to control everything. This becomes a waste of time,
and we simply spin our wheels. Sometimes we think we've solved the problem, when we really haven't. With
these critical input variables properly identified, we can put systems in place to ensure that improvements are
maintained for the long term.

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Introduction to Lean Six Sigma

The Black Belt Training Schedule

The first Lean Six Sigma project that a Black Belt delivers is completed simultaneously while going through the
five training in D-M-A-I-C. Some organizations expect that when Black Belts begin training, savings will be
realized almost immediately. This is not the case, as it takes approximately five or more months to complete a
project and begin to realize its benefits.

A Black Belt will attend one week of technical training, followed by three to four weeks of applying Lean Six Sigma
tools and techniques to an actual project. The training process repeats itself until all five phases of D-M-A-I-C
have been covered. Once the application period for the Control phase is completed, the project is validated and
its benefits are formally quantified and tracked.

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Introduction to Lean Six Sigma

Y as a Function of X

The Lean Six Sigma methodology focuses on determining the equation that relates process outputs called Y's to
process inputs, called X's. Generically, this equation is referred to as "Y equals some function of X." We can
explain the notion of X's and Y's using numerous analogies. The X's are independent factors, while the Y's are
dependent on these X's.

The X's can be thought of as the inputs to processes, while the Y's are the outputs. The X's can be considered the
causes while the Y's are the effects. The X's are the causes of problems, while the Y's are the symptoms. The X's
are what we need to control. The Y's we can only monitor. If we're so good at controlling X's, then why do we
constantly focus on inspecting and measuring Y?

If we truly knew the X's that need to be controlled, we would eliminate our need to constantly inspect and
measure Y's. The reality is, we don't usually know the X's that need to be controlled, and we need the structured,
problem-solving methodology of Lean Six Sigma to determine what they are.

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Introduction to Lean Six Sigma

The Complexity of y=f(x)

Defining Y as a function of X is one of the primary goals of the Lean Six Sigma process. However, in practice, the
equation is not as simple as Y = f(x).

For example, this equation tells us that Y can be a function of not just one, but many input factors. But in reality,
the equation is not always this simple either. Often there are many factors that affect a process, but some affect
the process more than others. However, this may be oversimplifying, too. Some of the input factors may not affect
the output in a linear fashion. Even though this looks complicated, the equation can be still more complicated.

We can also have some factors that are co-dependent: the effect of a change in one factor really depends on the
value of something else. In other words, there may be what we call "interactions" going on between variables.

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Introduction to Lean Six Sigma

A Real Life Example of y=f(x) - Temperature Problems

So here’s an example that I like to use very often in my classes.

I came into my office one day, sat down at my desk, and I was cold. I walked over to the wall to turn up the
temperature where the thermostat was and I realized very quickly that it was not a thermostat, it was just a
thermometer, and it said it was 68 degrees. I was cold. I was never cold before in my office, but all of a sudden I
was cold. So I called our facilities manager, and as it turns out, I was in kind of a newer, high-tech building, where
the temperature controls were controlled by a central computer system. And the facilities manager agreed to turn
the heat up for me. He turned it up to 69 degrees.

Well, a couple of hours later, I came back from a meeting, and I still felt cold. I called again and asked to have the
temperature turned up again, and it was turned up to 70 degrees. And this went on over the course of the day; by
the end of the day, the temperature had been turned up to about 72 degrees and I was feeling comfortable.

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Introduction to Lean Six Sigma

A Real Life Example of y=f(x) - The Real Problem

The interesting thing is, though, that it had always been set at 68 degrees and I had never had a problem. As it
turns out, some of the people in other offices around me were also feeling cold that day. So we had to solve the
problem, and we did that; we turned up the temperature. But, you know, you got to scratch your head and say,
“why are we all of a sudden cold when we were never cold before?” 68 degrees is kind of comfortable.

So everybody had their ideas of why we had this problem. And we did solve the problem; we turned up the
temperature. But what do you know, I come to work about a month later, sit down at my desk, and boy, was it hot
in my office. I made the comment to someone, “I thought we solved this problem with the temperature a month
ago.” The problem is back. And that’s what often happens.

We think we solve the problem, but the problem comes back. Maybe it looks a little bit differently, right? Now
we’re hot, last time we were cold, the problem looks a little different. But as it turns out, what had happened was,
the humidifier in my part of the building had broken.

I live in Colorado, and in Colorado in January, the humidity can get down to 10 or 15 percent. The humidifier
typically kept the humidity up around a comfortable 60 percent. The humidifier broke, all of sudden the air is at the
same dryness as outside, and 68 degrees feels cold, where it normally felt comfortable. Somebody was doing
monthly maintenance, noticed the humidifier was broken, and fixed it. So all of a sudden the humidity is back up
here, the temperature is 72 degrees and the problem has come back.

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Introduction to Lean Six Sigma

A Real Life Example of y=f(x) - The Equation

So what did we do? Well, we solved the problem at this level of complexity. We thought, conceptually, the
problem looked this tough, and we knew that the biggest factor that affected the comfort level was the
temperature. If you keep turning the temperature up, eventually we’ll get comfortable.

The reality is that the problem existed at this level of complexity, where there is a relationship between
temperature and humidity. What we call an interaction. This was constant, if “this” is humidity, this was constant
the whole time I was solving the problem. So if I keep turning up the temperature, I can overwhelm the effect of
the humidity, and it appears that I solved my problem.

And then of course the problem comes back. This is what corporations do all the time when they solve problems
and the problems come back. They think the problem is this simple, they adjust something, the problem goes
away; and lo and behold, three months later, six months later, it comes back.

Problems can come back because a vendor made a slight change to the material. The material might still be in
specification, but now all of a sudden it’s changed. The problem may come back because we have a new person
doing the job in accordance with the procedures but doing the job a little differently than the previous person.

Lean Six Sigma offers organizations a way to ensure that a problem is really never going to come back, because
we’re finally going to get an intimate understanding of the way our process works. That is the essence of the Lean
Six Sigma problem solving methodology.

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Introduction to Lean Six Sigma

Section 3: Why Lean Six Sigma Works


Why Lean Six Sigma Works

Suppose you're the owner of a very successful movie theater. You're about to take off on a three month business
trip overseas. While you're gone, you'd like to stay informed. You've asked the manager of your theater to fax you
a report every Monday morning. What five pieces of information would you ask for that would be most important
to you?

Let's assume that you're going to the movies yourself. The movie you'd like to see is playing at several different
theaters in your area. All charge the same price for a ticket, and the movie is playing at about the same time at
each theater. They're all in safe shopping malls with decent restaurants. They all offer the same stadium seating
arrangement, and are about the same driving distance from your home. How do you decide which theater to visit?

Now let's take a look at the answers recorded for both exercises. What do these two lists have in common? How
close is the owner's list to his customer's list? How in-tune is the owner with his customers? If you're like most, as
an owner you ask to see things like ticket sales, concession sales, employee attendance, a listing of which
movies are playing, customer complaints and equipment problems. And as a customer, you probably thought of
things like the length of the lines, good tasting popcorn, clean restrooms, a good quality sound system, availability
of parking and the friendliness of the staff.

The difference between these two lists centers on the fact that the customer’s needs should drive the items on the
owner's list. The owner's list is not information we can directly act on. Instead, it's lacking data that is a
consequence of how our customers feel. By the time an item on the owner's list shows a negative trend,
something in our customer's needs has been wrong for some time.

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Introduction to Lean Six Sigma

If we really understand the relationship between X's and Y's, where the X's are the customer’s needs, and the Y's
are the owner's needs, we can directly measure those things that keep us in touch with our customers, and act
before there's a negative impact on the business.

Lean Six Sigma is about improving customer satisfaction, and to do so means understanding what matters to your
customers. Once you can link customer satisfaction to internal business processes, you can appropriately drive
improvements in the business.

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Introduction to Lean Six Sigma

Building Project Benefits

The investment in Lean Six Sigma is ultimately worth it. For organizations that build a good solid foundation, Lean
Six Sigma will become the standard way by which we approach and resolve business issues. Let's work through a
simple example.

Assume that a company selects 10 people to become Black Belts. Then, let's assume that each project worked by
a Black Belt produces a $120,000 per year benefit to the company. This is about $10,000 per project per month,
or $100,000 total return per month.

During training, Black Belts follow a cycle of one week of training, followed by three weeks of action. Benefits from
the first project typically begin after the Control phase.

As the Black Belts complete and move on to other projects, the benefits from the previous projects grow while we
add the benefits of new projects. And as new waves of Black Belts are trained, we get even greater returns. After
a while, we begin to experience exponential growth, as the benefits of additional projects compound.

You can see that while there're not a whole lot of exciting returns in the first few months, and the accumulation of
returns is limited following the completion of the first projects, once we get out to the eighth, ninth and tenth month,
we really begin to see the power of Lean Six Sigma.

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Introduction to Lean Six Sigma

Module Review

In closing, there are numerous factors critical to the success of Lean Six Sigma.

The first factor we discussed was the notion of well-trained problem solvers, usually called Black Belts, working in
the context of a well-architected support system.

The second critical success factor we described was a powerful data-driven problem-solving methodology. We're
referring here to the powerful D-M-A-I-C methodology: the systematic reduction of input variables and the
identification of key leverage variables.

And last, we presented how the deployment of Lean Six Sigma projects should be closely aligned with the needs
of our customers and the strategic priorities of the business, generally with a sharp focus on financial results.

You should now understand what Lean Six Sigma is, its methodology, the potential impact to an organization's
culture, and why it works.

© Lean Methods Group. All rights reserved. No portion may be copied, rewritten, reproduced, or published.

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