BIM402 - 2 - Handout 4 - Lean Concepts, Tools and Methods

LEAN MANAGEMENT AND SIX SIGMA:
BIM 402
Instructor: Dr. Aruna Pugalenthi
HANDOUT # 4
Lean Concepts, Tools and Methods
2023-2024 Source: https://lms.lc.ac.ae/

Objectives of this course
CLO5: Use the techniques, skills, and modern engineering tools necessary to define-Measure-Analyze- Improve
and Control the Six Sigma Infrastructure.
CLO6: Implement Qualitative and Quantitative techniques of Lean Six Sigma and Continuous Improvement to
evaluate the Manufacturing System.
.
Learning objectives
• Lean Tools for Measurement
• Tools for Analysis
• Tools for Improvement
• Tools for Control
• Techniques for Lean Six Sigma: Quantitative Techniques
• Qualitative Techniques
Lean Tools for Measurement
4 BIM 402 - Lean Management and Six Sigma

Lean Tools for Measurement
➢ The important tools for measurement should include:
▪ M1: Check Sheets
▪ M2: Histograms
▪ M3: Run Charts
▪ M4: Scatter Diagrams
▪ M5: Cause and Effect Diagrams
▪ M6: Pareto Charts
▪ M7: Control Charts
▪ M8: Flow Process Charts
▪ M9: Process Capability Measurement
5 BIM 402- Lean Management and Six Sigma
Check sheets
➢ Check sheets are documents (forms, charts, tables, etc.) used to collect data.
➢ The items to be “checked”, or data to be gathered, are defined on the document

(either hard or electronic) so that this information can be collected easily and
concisely.
➢ Check sheets are used primarily in the measurement phase of DMAIC. This is
when data usually needs to be collected.

Check sheets
➢ 1. Number of Defective Items
Below is an example of a check sheet used to record the number of rejects

Flow chart
➢ An organized combination of shapes, lines, and text that graphically illustrates

a process or structure
➢ A pictorial representation showing all of the steps of a process
➢ There are no “one” definition for flowcharting symbols
➢ There are some guidelines for commonly used symbols

Flowcharting symbols
Manual Off Page

Input Connector Connector
Prompt for information, manually entered into

a system. Used to connect one part of a flowchart Connector used to connect one page
to another. of a flowchart to another.
Flowchart Example: Brewing Coffee

Histogram
➢ The Histogram is a graphical representation of data that is a dimensional

measurement of one feature.

Histogram
➢ The following data was collected when measuring the bow (warp) of a plastic
component. The specification is 0 to 8 x10-3 mm.
Bow measurements
2 5 8 8 2
4 6 6 6 4
4 7 6 6 4
8 7 7 5 9

Histogram Bow Frequency
0 0
6
1 0
5
2 2 4
3 0 3
Frequency
2
4 4
1
5 2
0
6 5
7 3
Thou
8 3
9 1
More 0
Histogram Bow Frequency
0 0
1 0 6
2 2 5
4
3 0
3
Frequency
4 4 2
5 2 1
6 5 0
7 3
Thou
8 3
9 1
More 0
Pareto Analysis
➢ Pareto analysis is a method for

prioritising data.
➢ It consists of a Bar Chart
displayed either in order of
frequency or relative cost.

Pareto Analysis - Example
➢ The information to be represented on a Pareto diagram should already have been
collected in some sort of record.
Houshold repairs over the last 10 years

frequency Cost £ per Total cost
Problem occurrence £
Light bulb fails 100 0.6 60
Broken central heating
pump 1 190 190
Broken window 2 50 100
Leaking taps 16 2.5 40
Faulty central heating
boiler 1 3000 3000
Leaking radiators 3 15 45
Pareto Diagram
➢ The data are then displayed graphically. Firstly, in terms of frequency.....
House repairs 1998-2008
120
100
Occurance
80 frequency
60
Cum %
40
20
0
bulb fails
window
Leakiung
Leaking
Broken
Broken
heating
heating
central
central
radiators
Faulty
taps
Light
Fault

Pareto Diagram
➢ The data are then displayed graphically. Secondly, in terms of the cost
House repairs 1998-2008 Total cost £
3500
3000
2500
2000
1500 Total cost £
1000
500
0
Faulty Broken Broken Light Leakiung Leaking
central central window bulb fails radiators taps
heating heating
boiler pump

Cause and Effect Diagram
➢ The data are then displayed graphically. Secondly, in terms of the cost

Cause and Effect Diagram
➢ Cause-and-Effect Diagram for Hospital Emergency Admission

Scatter Diagrams
What is it used for?

• Validating "hunches" about a cause-and-effect relationship between two
variables.
• Displaying the direction of the relationship (positive, negative, etc.)
• Displaying the strength of the relationship

Constructing scatter diagram
• In order to construct a scatter diagram, you need two variables to be plotted
against each other. One on the x axis the other on the y axis.
• The relationship is then plotted.

Interpreting a scatter diagram

Run Charts
▪ Run charts are used to analyze processes
according to time or order.
▪ A Run Chart has a wide range of applications

to detect trends, variation or cycles. It allows a
team to compare performances of a process
before and after the implementation of the
solution. The application areas include sales
analysis, forecasting, performance reporting
and seasonality analysis.

Run Charts
▪ An Example of Using a Run Chart
- An organization’s desire is to have their product arrive to their customers on time,

but they have noticed that it doesn’t take the same amount of time each day of the week.
They decided to monitor the amount of time it takes to deliver their product over the next
few weeks.

Control charts
▪ Dr. Shewhart developed the control charts as a statistical approach to the
study of manufacturing process variation.
▪ it helps the process perform consistently and predictably.
▪ it can minimise the variation in output.
▪ it can help to achieve lower product costs.
▪ it can help to increase effective capacity.
▪ it can help to meet customer expectations

Control charts

Control charts
Histograms do not
take into account
changes over time.
Control charts can

tell us when a
process changes

Process Capability Index
product specification range USL − LSL
Cp = =
process var iation range 6
where: USL = upper specification limit

LSL = lower specification limit
Cp Values:
• Cp = 1: process is minimally capable

• Cp ≤ 1: process is not capable of producing products within specification
• Cp ≥ 1: process exceeds minimum capability
• Six sigma requires Cp =2

Cp Example
Given a process with three separate machines that are used to fill jars with pasta
sauce.
• specification range is between 30 and 34 ounces

• process mean, μ, is 31 ounces
Calculate the Cp for each machine to determine capabilities

Cp Example Continued
Machine A has a Cp > 1,

however the process
mean is not centered

Cpk Example
Cpk addresses the lack of

centering of the process
over the specification
range

The following data was collected when measuring the bow (warp) of a plastic
component. The specification is 0 to 8 x10-3 mm. Cpk = ? and 𝜎 = 1,95
Bow measurements
2 5 8 8 2
4 6 6 6 4
4 7 6 6 4
8 7 7 5 9

The following data was collected when measuring the bow (warp) of a plastic
component. The specification is 0 to 8 x10-3 mm. Cpk = ? and 𝜎 = 1,95
Bow measurements
2 5 8 8 2
4 6 6 6 4
4 7 6 6 4
8 7 7 5 9


A specification requiring a delivered pizza to be between 120 degrees
Fahrenheit and 125 degrees Fahrenheit when it arrives at the customer’s door.
The data collected are as follow


Tools for Analysis
• The objective is to identify all possible sources of variation.

• The data collected in the Measure stage are examined to generate a
prioritized list of sources of variation.

Tools for Analysis
Tools for Analysis

❖ Regression Analysis
❖ PESTLE Analysis
❖ The Five Whys
❖ SWOT Analysis
❖ Interrelationship Diagram
❖ TRIZ: Innovative Problem Solving

Regression
➢ Regression is the attempt to explain the variation in a dependent variable

using the variation in independent variables.
➢ Regression is thus an explanation of causation.
➢ If the independent variable(s) sufficiently explain the variation in the

dependent variable, the model can be used for prediction.

Regression
➢ Regression is the attempt to explain the variation in a dependent variable
using the variation in independent variables.
➢ Regression is thus an explanation of causation.
➢ If the independent variable(s) sufficiently explain the variation in the

dependent variable, the model can be used for prediction.

Regression

Simple Linear Regression
➢ The output of a regression is a function that predicts the dependent variable
based upon values of the independent variables.
➢ Simple regression fits a straight line to the data.

PESTLE Analysis
➢ The PESTLE Analysis is an analytical tool for assessing the impact of
external contexts on a project or a major operation and also the impact of a
project on its external contexts.

5 Whys
➢ 5 Whys is an iterative interrogative technique used to

explore the cause-and-effect relationships underlying a
particular problem. The primary goal of the technique is to
determine the root cause of a defect or problem by
repeating the question "Why?" Each answer forms the basis
of the next question.

5 Whys
Problem Statement: Customers are unhappy because they are being shipped
products that don’t meet their specifications.
1. Why are customers being shipped bad products?
– Because manufacturing built the products to a specification that is
different from what the customer and the salesperson agreed to.
2. Why did manufacturing build the products to a different specification than
that of sales?
– Because the salesperson expedites work on the shop floor by calling
the head of manufacturing directly to begin work. An error happened
when the specifications were being communicated or written down.
5 Whys
3. Why does the salesperson call the head of manufacturing directly to start
work instead of following the procedure established in the company?
– Because the “start work” form requires the sales director’s approval
before work can begin and slows the manufacturing process (or stops
it when the director is out of the office).
4. Why does the form contain an approval for the sales director?
– Because the sales director needs to be continually updated on sales
for discussions with the CEO.

SWOT analysis

SWOT
analysis

Interrelationship Diagram
❑ Identifies and explores causal relationships among related concepts or ideas.
❑ It allows the team to classify the cause-and-effect relationships among all
factors so that the key drivers and outcomes can be used to solve the problem.
Interrelationship Digraph (2)

❑ Benefits:
❖ Allows the team to identify root causes from subjective data.
❖ Systematically explores cause-and-effect relationships.
❖ Encourages members to think multidirectional.
❖ Develops team harmony and effectiveness.

Repeated service calls on a machine

TRIZ: Theory of Inventive Problem Solving
❑ “TRIZ” is the (Russian) acronym for the “Theory of Inventive Problem

Solving.”
❑ Common creativity tools have been limited to brainstorming and related
methods, which depend on intuition
❑ TRIZ is a problem-solving method based on logic and data, not intuition,
which accelerates the project team’s ability to solve these problems
creatively.

❑ More than three million patents have been analyzed to discover the patterns that
predict breakthrough solutions to problems.
❑ TRIZ research began with the hypothesis that there are universal principles of
creativity
❖ Somebody someplace has already solved this problem (or one very similar to it.)
❖ Creativity is now finding that solution and adapting it to this problem.

❑ The “General TRIZ Solutions” referred to in Exhibit have been developed

over the course of the 60 years of TRIZ research and have been organized in
many ways. Some of these are analytic methods such as:
➢ The Ideal Final Result and Ideality,
➢ Locating the Zones of Conflict. (This is more familiar to Six Sigma
problem solvers as “Root Cause Analysis.”)

Part 3 : Tools for Improvement

Tools for Improvement
❑ During the Improve phase, the ideas and solutions are put to work. Various
options are then compared with each other to determine the most promising
solution.
❑ The objectives of the tools of the Improve phase are to help the team to develop
a solution for improving process performance and to confirm that the proposed
solution will meet or exceed the quality improvement goals of the project.

Tools for Improvement
The important tools for improvement should include:
❖ Affinity Diagram
❖ Nominal Group Technique
❖ SMED
❖ FIVE S
❖ Mistake Proofing
❖ Value Stream Mapping
❖ Brainstorming
❖ Mind Mapping

Affinity Diagram
❖ This tool gathers large amounts of text data
(ideas, opinions, issues, etc.)
❖ Organizes it into groupings based on the natural
relationship between each item
❖ Is largely a creative rather than a logical process

Affinity Diagram
Purpose:
❖ The purpose of an affinity diagram is to provide a visual representation
of grouping of a large number of ideas or factors or requirements into
logical sets of related items to help one organize action-plans in a
systematic manner.
❖ Due to visual representation, one can easily understand the problem and
its various solutions and impact, which, in turn, help implement the
solutions with a clear understanding.

Nominal Group Technique
Provides the issues/ideas input from everyone on the team and for
effective decisions.

Nominal Group Technique
Steps:
1. Everyone writes on a piece of paper the situation they think is
most important.
2. The papers are collected, and all situations are listed on a flip
chart.
3. Rank the situations (using another paper). Give numerical
values 1…
4. Points for each problem are totaled and the item with the
highest number of points is considered to be the most
important.
Stages

Single Minute Exchange of Dies (SMED)
❑ SMED or Single Minute Exchange of Dies is name of the approach used

for reducing output and quality losses due to changeovers and setups.
❑ ‘ Single Minute ’ means that necessary setup time is counted on a single
digit.
❑ SMED is considered as an essential tool in Lean Manufacturing, and it is
instrumental in the reduction of non-value-added activities in process
times.

Single Minute Exchange of Dies (SMED)
❑ Large time losses due to setup are generally accepted in many industries
❑ Expensive, high-tech equipment is often seen as beneficial in saving time
and money
❑ It is often the case that creativity and simplicity is the best solution to
these problems
❑ Generally, several smaller/simpler machines will be more beneficial

Benefits of Single Minute Exchange of Dies (SMED)
❑ Reduced setup time

❑ Higher efficiencies
❑ Increased capacity
❑ Lower batch sizes
❑ Increased safety
❑ Increased flexibility
❑ Elimination of waiting
❑ Stockless production

Internal Vs. External Setup
Classification essential to effective SMED system
❖ External Setup: One that may be completed while machine is in

operation
❖ Internal Setup: One that requires the shut down of the machine for
completion

Internal Vs. External Setup (cont’d)
❖ Primary goal is to change all internal setups to external ones

❖ Reduce length of internal setup if unable to convert to external
❖ Reduce length of all external setups as well

Simple Suggestions
❖ Analysis of setup procedures using videotapes

❖ Use more people where available
❖ Use offline time as maintenance time
❖ Practice makes perfect

5-S Implementation
❖ Promotes visual management and a clean and safe workplace that results in a
high level of organization and efficiency

The 5-S’s
❖ “Straighten” - separating what is and is not needed

❖ “Sort” - a place for everything, and everything in its place
❖ “Shine” - a clean workplace should be an established goal
❖ “Sustain” - adherence to the first three S’s in the 5S program
❖ “Standardize” - continuous use of the first four S’s until they become
second nature to employees

Benefits of 5-S
❖ Increased morale
❖ Safety
❖ Non-Value-added activity decreased
❖ Efficiency and organization
❖ Increased quality
❖ Faster Lead Time
❖ Increased creativity, and willingness to contribute among employees.

Mistake Proofing
❑ What is Mistake Proofing?
❖ The use of process or design features to prevent errors or their negative
impact.
❖ Also known as Poka yoke, Japanese slang for “avoiding inadvertent
errors” which was formalized by Shigeo Shingo.
❖ Inexpensive.
❖ Very effective.
❖ Based on simplicity and ingenuity.

Seven Guidelines to Poka Yoke Attainment
❖ Quality Processes - Design “Robust” quality processes to achieve zero
defects.
❖ Utilize a Team Environment - leverage the teams knowledge, experience to
enhance the improvement efforts.
❖ Elimination of Errors - Utilize a robust problem solving methodology to drive
defects towards zero.
❖ Eliminate the “Root Cause” of The Errors-Use the 5 Why’s.
❖ Do It Right The First Time - Utilizing resources to perform functions
correctly the “first” time.

Seven Guidelines to Poka Yoke Attainment
❖ Eliminate Non-Value Added Decisions - Don’t make excuses - just do it !

❖ Implement an Incremental Continual Improvement Approach - implement
improvement actions immediately and focus on incremental improvements;
efforts do not have to result in a 100% improvement immediately.

Value Streams
❖ What Are Value Streams?

A Value Stream is the set of all actions (both value added and nonvalue
added) required to bring a specific product or service from raw material
through to the customer.

Identifying the Value Stream
❖ The starting point is to learn to distinguish value creation from waste in

your whole value stream
❖ By putting on waste glasses!
❖ By choosing a product family
❖ By assembling the team and taking a walk together up the value stream
❖ And drawing a map of what you find!

Value Stream Mapping
❖ Helps you visualize more than the single process level

❖ Links the material and information flows
❖ Provides a common language
❖ Provides a blueprint for implementation
❖ More useful than quantitative tools
❖ Ties together lean concepts and techniques

❖ Follow a “product” or “service” from beginning to end, and draw a

visual representation of every process in the material & information
flow.
❖ Then, draw (using icons) a “future state” map of how value should flow.


Brainstorming
❑ A group creativity tool used to generate a large number of ideas to solve a
problem
❑ There are different techniques
❖ Round Robin: move around group in turn
❖ Silent: write Shout Out: as it comes to you
❖ Post Up: Pin ideas / suggestions on board so all can see and add for
getting inputs from different departments, the weekend crew or multi-
shifts
❖ down ideas on slip of paper

Idea Generation Tips
➢ Ideas and inspiration come from association – build on words, themes, topics
➢ Try reverse thinking: how can we make this worse? then turn it around
➢ Ask why?, then ask why? And again …
➢ Avoid idea assassins, eliminate the “can’t” word from your group

Rules for More Effective Brainstorming
DO
▪ Understand the focus, record all ideas
▪ Allow individuals to complete their thoughts
▪ Build on existing ideas (this is the power of brainstorming)
▪ Strive for quantity – clarify the idea later…
▪ Organize, categorize, and evaluate LATER!
DON’T
▪ Criticize ideas (consolidation and evaluation come later)
▪ Make judgments, verbal or visual, as ideas are being offered
▪ Allow any one person to dominate the session
▪ Stop when the page is full, (hang paper up on wall and go on)
Mind Mapping
❑ Mind Mapping is a learning tool for ordering and structuring the thinking process
of an individual or team working on a focused theme.
❑ It is a graphic tool to express ‘ radiant thinking ’ comprising four key
characteristics:
1. The subject or theme is presented as a central image or key word.
2. The main components of the subject root out from the central image as branches.
3. Each branch contains a key word printed on an associated line.
4. The sub-components of each branch are also represented as branches attached to
higher level branches.
Mind Mapping
❖ Mind Map is arguably comparable to the Cause-and-Effect Diagram where

the effect represents the central image of the Mind Map. Each of the
branches of the Mind Map are the causes in the Cause-and-Effect Diagram.

Mind Mapping
An example of a Mind Map for Late Delivery is illustrated in Figure 7.4 .

Part 4 : Tools for Control

Tools for Control
The objective of the ‘ Control ’ phase is to implement the solution, ensure

that this solution is sustained, and share the lessons learned from the
improvement projects throughout the organization.

Tools for Control
The key tools for Control should include:

❖ C1: Gantt Chart
❖ C2: Activity Network Diagram
❖ C3: Radar Chart
❖ C4: PDCA Cycle
❖ C5: Milestone Tracker Diagram
❖ C6: Earned Value Management

Gantt Chart
❖ A Gantt Chart is a simple tool which represents time as a bar or a line on

a chart. The start and finish times for activities are displayed by the
length of the bar and often the actual progress of the task is also
indicated.
❖ A Gantt Chart is also known as a Bar Chart.

Gantt Chart
❖ The merits of Gantt Charts are that they are simple to use, and they
provide a clear visual representation of both the scheduled and actual
progress of activities.

Network Diagrams
❖ Two popular network diagrams:
❖ Activity on Arrow (AOA) network diagrams or Arrow diagramming method (ADM)
❖ Project network diagrams or Precedence Diagram Method (PDM)

Activity on Arrow (AOA) Network Diagrams
❖ Also called Arrow Diagramming Method (ADM)
❖ A network diagram in which activities are represented by arrows
❖ ADM is used for scheduling activities in a project plan
❖ Precedence relationships between activities are represented by circles connected
by one or more arrows
❖ The length of the arrow represents the duration of the activity
❖ ADM only shows finish-to-start relationships, meaning that each activity is
completed before the successor activity starts
❖ Sometimes a "dummy task" is added, to represent a dependency between tasks,
which does not represent any actual activity. Such a dummy task often has a
93
completion time of 0
BIM 402- Lean Management and Six Sigma


Project Network Diagrams
▪ Also called Precedence Diagram Method (PDM)

▪ A visual representation technique that depicts the activities involved in a project
▪ Communicate the flow of project execution
▪ Identify missing activities: When an activity is not identified, it’ll never be
done.
▪ Identify dependencies: Each activity is dependent on some other activity. When
a dependency is not identified, the project will be delayed until such a time that
identification occurs

▪ Identify critical activities: Certain activities have a greater impact on

project schedule than others. This is known as the Critical Path Method
(CPM)
▪ Create a project schedule: The final goal is to create a practical and robust
project schedule.

▪ Task Dependency types


Radar Chart
❖ A Radar Chart is a polar graph to show using just one graphic the size
of the gaps in the performance levels of key performance indicators.
❖ A Radar Chart is also known as a Polar Graph and, because of its
appearance, as a Spider Diagram.
❖ A Radar Chart is a useful visual tool to display the important metrics of
performance at the Control stage of a quality improvement program.
10
0
Public Perception Survey Brand Reputation
100 100
88 90
80
Future Orientation
100 100
100
70 Tech Support
65
86
60
50 Notes
60
40
30 This chart compares the public perception of

three high-technology companies. It's based on
20 a hypothetical survey distributed in a popular
industry magazine with a circulation of more
10 than 600,000. There were approximately 20,000
respondents. The survey asked participants to
100 86 75 60 80 90
Customer Focus Community Awareness rate each subject in eight categories on a scale
of 0 to 100.
This analysis shows that for the area of Tech

Support, at three companies enjoy similar
reputations. This rating might be considered
industry standard. The ethical practice category
shows a very different picture with the public
clearly perceiving company B as behind in that
area.
70 50
86 85
90
Product Quality100 70 100
Employment Practices
86
Ethical Practices
Company A Company B Company C
10
1
PDCA
10
2
Milestone Tracker Diagram
❖ A milestone is a key event selected for its
importance in the project.
❖ A Milestone Tracker Diagram is used to
show the projected milestone dates and
the best estimated date on the week of the
progress review on a single chart.
❖ The purpose is to assess the achievement
or slippage of the progress. Thus the
Milestone Tracker Diagram is also called
10
the Milestone Slippage Chart.
3
Control Costs – Earned Value Management
▪ Earned Value Management (EVM) – Is an Project Management

methodology to determine project performance at any given point of
time and forecast project’s future performance.
▪ EVM Integrates project triple constraints (scope, cost, schedule) to
determine project progress and performance
10
4
Control Costs – Earned Value Management
❑ EVM uses three key measurement components
❖ Planned Value (PV) – denotes the authorized budget to be expended for an
activity, work package, or to the project at a given point, sometimes referred
to as the “Budget At Completion (BAC)” (the total PV at the end of the
project)
❖ Earned Value (EV) – The value of work performed expressed in terms of
the authorized budget
❖ Actual Cost (AC) – Cost incurred or expended for the work performed at a
given point
10
5
Graphical Analysis
10
6
Earned Value Metrics
Earned Value Variances
Cost Variance (CV) > 0 means under budget
= Earned Value (EV) - Actual Cost (AC) < 0 means over budget
Schedule Variance (SV) > 0 means ahead of schedule
= Earned Value (EV) - Planned Value (PV) < 0 means behind schedule
Earned Value Indices
Cost Performance Index (CPI) > 1 means better progress for the money
= EV/AC < 1 means less progress for the money
Schedule Performance Index (SPI) > 1 means more work performed than scheduled
= EV/PV < 1 means less work performed than scheduled
Project Percent Complete Percent of project work complete.
= (EV/BAC) * 100 Where BAC = Budget at Completion
To Complete Performance Index (TCPI) The cost performance index required to complete the project
= (BAC-EV)/(BAC-AC) on budget.
Earned Value Forecasts
Estimate at completion (EAC)
The estimated total cost at project completion.
= BAC/CPI
Variance at completion (VAC) The estimated variance between actual total cost and planned
= BAC-EAC total cost at project completion.
10
7
EVM - Example
Let us consider the following example to understand the concepts better.
An ERP implementation project for ABC company is estimated to cost

$500,000 with an estimated duration of 40 weeks. At the end of 10 weeks the
project is 20% complete with $150,000 being already spent on the project.
BAC =500,000, AC = 150,000,
PV = 10/40*500,000 = 125,000
EV = 20/100*500,000 = 100,000
10
8
Variance and Performance Analysis
BAC = 500,000 PV = 125,000 EV = 100,000 AC = 150,000
Metric Formula Value Analysis

CV EV-AC -50,000 This indicates $50,000 has already been additionally
spent in excess of the project worth of work up-to this
point
SV EV-PV -25000 The negative value indicates the project is lagging behind
its planned schedule.
CPI EV/AC 0.67 A value less than 1 indicates over utilization of funds
against the actual work. In this case the project is earning
$0.67 worth value for every $ spent, not a good sign.
SPI EV/PV 0.80 A value less than 1 indicates that the project is behind
planned schedule and progress has only been at 80% .
10
9
Budget Forecast Analysis
BAC = 500,000 PV = 125,000 EV = 100,000 AC = 150,000
CV = -50,000 SV = -25,000 CPI = 0.67 SPI = 0.80
Metric Formula Value Analysis
EAC BAC/CPI 746,268.65 The revised estimates now for project completion
based on current performance is $746,268.65 as
against planned $500,000.
ETC EAC-AC 596,268.65 The project would now require additionally
$596,268.65 to complete from this point onwards
VAC BAC-EAC -246,268.65 There is an additional $246,268.65 required to

complete the project compared to original
estimates
TCPI (BAC-EV)/(BAC-AC) 1.14 The project need to now perform at an
(WORK LEFT TO performance of 1.14 times in order to stay within
DO)/ MONEY the estimated budget
REMAINING)
11
0
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LEAN MANAGEMENT AND SIX SIGMA:

2023-2024 Source: https://lms.lc.ac.ae/

and Control the Six Sigma Infrastructure.

evaluate the Manufacturing System.

4 BIM 402 - Lean Management and Six Sigma

➢ The items to be “checked”, or data to be gathered, are defined on the document

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7 BIM 402- Lean Management and Six Sigma

➢ An organized combination of shapes, lines, and text that graphically illustrates

➢ A pictorial representation showing all of the steps of a process

➢ There are no “one” definition for flowcharting symbols

➢ There are some guidelines for commonly used symbols

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Manual Off Page

Prompt for information, manually entered into

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➢ The Histogram is a graphical representation of data that is a dimensional

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➢ Pareto analysis is a method for

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Houshold repairs over the last 10 years

House repairs 1998-2008

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House repairs 1998-2008 Total cost £

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What is it used for?

• Displaying the direction of the relationship (positive, negative, etc.)

• Displaying the strength of the relationship

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• The relationship is then plotted.

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▪ A Run Chart has a wide range of applications

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- An organization’s desire is to have their product arrive to their customers on time,

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▪ it helps the process perform consistently and predictably.

▪ it can minimise the variation in output.

▪ it can help to achieve lower product costs.

▪ it can help to increase effective capacity.

▪ it can help to meet customer expectations

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Control charts can

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where: USL = upper specification limit

• Cp = 1: process is minimally capable

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• specification range is between 30 and 34 ounces

Calculate the Cp for each machine to determine capabilities

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Machine A has a Cp > 1,

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Cpk addresses the lack of

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