Lean Six Sigma

Green Belt Training

 UNIT 3
Analyze

ING Business School

 Analyze – Learning Objectives
• At the conclusion of this unit, you will be able
to:
• “Peel back” the layers of the causal chain to
identify potential causes of process problems.
• Complete a fishbone diagram to identify
potential root causes.
• Confirm root causes with data.

ING Business School Ref Unit 3-1

 Analyze – Major Activities

DEFINE MEASURE ANALYZE IMPROVE CONTROL

Identify Identify Collect Data to

Potential Potential Root Confirm
Causes Causes Root Causes

Overall objective: Identify and confirm the root

causes of the revised problem statement.

ING Business School

Ref Unit 3-2a
Analyze – Key Deliverables and Commonly Used Tools

Key Deliverables Commonly Used Tools

 List of potential root  NVA and VA Analysis
causes (Xs)  Affinity Diagram
 Confirmed relationship  Fishbone Diagram
of Xs to revised problem
 Scatter Plots
statement (Y)
 Stratified Frequency
Plots
 Contingency Table

ING Business School Ref Unit 3-2b

 Analyze – Major Activities

DEFINE MEASURE ANALYZE IMPROVE CONTROL

Identify Identify Collect Data to

Potential Potential Root Confirm
Causes Causes Root Causes

ING Business School

Ref Unit 3-3a
 Identify Potential Causes
• Analysis is a search for causes
• Many causes may be identified
• The objective is to identify those causes that
most significantly contribute to the problem -
root cause

Cause and effect analysis begins with

experience‑based guesses and progresses
toward data-based proof.

ING Business School

Ref Unit 3-3b
 Cycle Time Analysis

Cycle
Cycle time is the Time
total time required
to perform all Process

process activities, Suppliers Customers

including both Outputs

Inputs
value-add and non-
value-add time.

ING Business School

Ref Unit 3-4a
 Cycle Time Analysis
Waste vs. Work

Eliminate Non-Value-
Added Actions
NET
Increase Value- WORK
WASTE
Added Work ALL
WORK Typically 50-75%
of work in
manufacturing
AUXILIARY WORK
and 60%-75% of
work in
transactional
processes is non-
Minimize Non-Value-Added
value add.
But Necessary Work

ING Business School

Ref Unit 3-4b
 Cycle Time Analysis (cont’d.)

Lean Thinking
A. Identify waste
B. Define what is value-add and not
C. Measure cycle time

ING Business School

Ref Unit 3-5a
 Cycle Time Analysis (cont’d.)

Seven Types of Waste

1. Processing
2. Waiting
3. Motion
4. Inventory
5. Transportation
6. Overproduction
7. Correction

ING Business School

Ref Unit 3-5b
 Cycle Time Analysis (cont’d.)

Processing Waste
• Information is requested but
not actually required, e.g.
application forms
• Exception processing / rework
required by defects in the
process
• Activities no longer needed, but
still a part of the process

Inventory

ING Business School

Ref Unit 3-5c
 Cycle Time Analysis (cont’d.)

Waiting Waste
• Colleagues not being able to perform
work, e.g., IT system is down
• Only one fax available for department –
often in use
• Bottlenecks
• Delays waiting for decisions to be taken
before being able to continue work

Inventory

ING Business School

Ref Unit 3-5d
 Cycle Time Analysis (cont’d.)

Motion Waste
• Inefficient office layout, requiring
frequent movement for colleagues
to collaborate
• Redundant activities – more than
one person doing the same thing
• Client files move to storage while
still requiring consultation

Inventory

ING Business School

Ref Unit 3-5e
 Cycle Time Analysis (cont’d.)

Inventory Waste
• Extra brochures are printed
‘just in case’
• Stationary is ordered annually
requiring storage space
• Piles of ‘Work In Progress’ exist
between process steps
• Physical files are stored on
department floor

Inventory

ING Business School

Ref Unit 3-5f
 Cycle Time Analysis (cont’d.)

Transportation Waste
• Unnecessary movement of
paperwork and equipment
• Often linked to poor office lay-
out
• Using Internal Mail / Fax to hand
over work to colleagues

Inventory

ING Business School

Ref Unit 3-5g
 Cycle Time Analysis (cont’d.)

Overproduction Waste
• We produce more or earlier than
required
• Process output is increased to ensure
enough quality items are produced
• Multiple data entries for same
information
• Manual work - not taking advantage of
system capability

Inventory

ING Business School

Ref Unit 3-5h
 Cycle Time Analysis (cont’d.)

Correction Waste
• Process errors are allowed to
move to the next process
step without finding
preventive solution
• Orders are checked 5 times
before sending to customer
• All orders are checked on
quality vs. sampling

Inventory

ING Business School

Ref Unit 3-5i
 Cycle Time Analysis (cont’d.)

Value-Added Time Non-Value-Added Time

•Customers care about it; •Processing
they are willing to pay for •Waiting
it •Motion
•The process activity •Inventory
physically changes the
•Transportation
product/service
•Overproduction
•Re-work is not involved;
•Correction
the work is done right the
first time
• Do not get too hung up on what type of waste it is
• Focus on finding a sustainable way to remove it

ING Business School

Ref Unit 3-5/6
 Cycle Time Analysis (cont’d.)

Measuring Cycle Time

 Decide whether to measure cycle time on the entire
process or a sub-process
 Use a flowchart/process map
 Develop operational definitions for the starting and
ending points of each activity
 Develop consensus about what is value-added and
what is non-value-added time
 Create a data collection form to identify which
activities will yield the most process improvement

ING Business School

Ref Unit 3-7a
 Cycle Time Analysis (cont’d.)

Useful Cycle Time Data

• Estimated cost/activity – total cost, not activity-based cost
• Process time – value-add time per unit
• Change-over time – time required to change from one type of
product/service to another, including learning time
• Queue time – time spent waiting to be processed
• Takt time – the rate at which output is completed, compared to
customer demand
• Complexity – the number of different products/services
processed at the activity
• Uptime – time worked per day minus breaks and interruptions
• Defects and rework – time needed to correct defective
products/services

ING Business School Ref Unit 3-7b

 Cycle Time Analysis (cont’d.)
Cycle Time Data Collection
Credit Voucher Turnaround Time
Non-
Value-Add Total Step
Process Step Value-Add Notes
Time Time
Time
1. Customer Service Data reentered into
5 min 5 min 10 min
prepares voucher system

2. Receiving clerk
5 min 5 min Logging is not necessary
logs voucher

Form should be filled out

3. Accounting clerk
10 min 10 min correctly and not require
reviews voucher
review

All additional process steps, time, and notes are included here

Total Process Time

ING Business School

Ref Unit 3-8
 Activity

Identify cycle time waste in

your process.

ING Business School

Ref Unit 3-9
 Identify Potential Causes

• Gather Many Causes

• Use data from Measure Step
• Talk with people
• Focus on what you know
• Think about sources of variation – people,
materials, methods, equipment, environment
• Review past records

ING Business School

Ref Unit 3-10
 Identify Potential Causes (cont’d.)

• Brainstorming
Brainstorming approaches
• Brainstorming
guidelines

ING Business School

Ref Unit 3-11
 Analyze – Major Activities

DEFINE MEASURE ANALYZE IMPROVE CONTROL

Identify Identify Collect Data to

Potential Potential Root Confirm
Causes Causes Root Causes

ING Business School

Ref Unit 3-12a
 Identify Potential Root Causes

The search for potential causes

evolves to a selection of those
causes most likely to be the
reason for the revised problem
statement.

ING Business School

Ref Unit 3-12b
 Identify Potential Root Causes (cont’d.)
Cause and Effect Analysis

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ING Business School

Ref Unit 3-12c
 Identify Potential Root Causes (cont’d.)

Fishbone Diagram
Major Bone Major Bone

1st Level Cause 1st Level Cause

3rd Level

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Revised
ve

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Problem

2 nd
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Statement
1st Level Cause
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Review for Continuity

ING Business School
Ref Unit 3-15
 Identify Potential Root Causes (cont’d.)

Affinity Cluster Approach

• Brainstorm possible causes for problem
statement
• Arrange causes into affinity clusters
• Label each cluster
• Expand causal levels for each major bone

ING Business School

Ref Unit 3-16
 Identify Potential Root Causes (cont’d.)

Affinity Cluster Approach (cont’d.)

• Brainstorm possible causes for the
problem statement.
Fish boning
tip:

 Focus on the problem statement Write the

causes on post-
developed in the Measure step and it notes as you
brainstorm causes for it to occur. identify them.
This facilitates
moving them
around.

ING Business School

Ref Unit 3-17
 Identify Potential Root Causes (cont’d.)

Affinity Cluster Approach (cont’d.)

• Arrange possible causes into affinity clusters.

 Clarify the meaning

 Sort into clusters according to affinity.
 Adding new items is okay, as is editing.
 If a cause seems to fit into two different clusters,
make another post-it note and place one in each
cluster.

ING Business School

Ref Unit 3-18a
 Example
Brainstorm list
1. Data entry error 7. Process not well defined
2. Not familiar with rules 8. Different operating systems in use
3. No system support 9. Manual calculations required
4. Inefficient scanner 10. Short-sighted planning for new product
5. Documents not checked 11. Applicable rules must be checked manually
6. Operations delays 12. New product launch was expedited

Manual calculations required Conversion form delayed

Process not well defined
Operations delays Affinity
New product launch was expedited
Applicable rules must be checked manually Clusters
Short-sighted planning for new product
Data entry error
Duplicated
Applicable rules must be checked manually
Not familiar with rules No system support Edited Inefficient
Documents not checked System support not available at this time scanner
Different operating systems in use
ING Business School
Ref Unit 3-18b
 Identify Potential Root Causes (cont’d.)

Affinity Cluster Approach (cont’d.)

• Label each cluster.

 Focus on one cluster.

 Discuss what the listed causes have in common.
 Agree on a name for that cluster.
 Draw a main bone and label it with cluster name.

ING Business School

Ref Unit 3-19a
 Example
People
New Product Launch Process
Affinity
Conversion form delayed
Manual calculations required Clusters Process not well defined
Operations delays
New product launch was expedited
Applicable rules must be checked manually
Short-sighted planning for new product
Data entry error Inefficient
scanner
Systems
Not familiar with rules Applicable rules must be checked manually
Documents not checked Add to fishbone System support not available at this time
where appropriate Different operating systems in use

People Systems Turnaround time

for 83% of XYZ
product clean
cases exceeds
seven working
New Product Launch Process days

ING Business School

Ref Unit 3-19b
 Identify Potential Root Causes (cont’d.)

Affinity Cluster Approach (cont’d.)

• Expand causal levels for each major bone.
 Use the causes listed in each cluster.
 Write new ideas on post-it notes.
 Modify wording/placement of causes.
 Continue with all major bones in same manner.
 Check for continuity – Ask, “Does this level cause
effect this other level cause?”
 You should be able to answer yes at each level.

ING Business School

Ref Unit 3-20a
 Example

Continue by asking, “ Why

Ru
are docs not checked?”
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he c
ck
People
ed
Systems

m
Not familiar w/rules
an
ua
lly
Operations delays
Docs not checked
ed
Data entry error
uir
eq

Not familiar w/rules

sr

Turnaround time for

io n

83% of XYZ product

l at
l cu

clean cases exceeds

ca

seven working days

al
nu
Ma

From affinity cluster –

shown with cause/effect
relationship
New Product Launch Process

ING Business School

Ref Unit 3-20b
 Identify Potential Root Causes (cont’d.)

Ask Why 5 Times

84% of proposals not
• Ask, “Why does this (cause) happen?” prepared on time for
manager’s approval
• Keep asking until answers are not actionable. involve delays.

1. Why are 84% of Proposals not sent on time? 1. Cause

Answer: Sales Rep. doesn’t make decision in time.
2. Why isn’t decision made in time?
Answer: Sales Rep. busy researching to prepare response. 2. Cause
3. Why is Sales Rep. busy researching?
Answer: Uncertain about products, services, & pricing. 3. Cause
4. Why is Sales Rep. uncertain?
Answer: Does not always have new product information.
4. Cause
5. Why doesn’t Sales Reps. have information needed?
Answer: Didn’t know information was needed.
5. Cause

ING Business School

Ref Unit 3-21
 Identify Potential Root Causes (cont’d.)

Select Root Causes of Revised Problem

Statement
• Usually the source of other causes.
• Occurs several times during analysis.
• Is not a symptom.
• Trust instincts.
• May be more than one root cause.
• Focus on causes you can measure/control.

ING Business School

Ref Unit 3-22
 Activity

Practice fishbone diagram.

ING Business School

Ref Unit 3-23
 Analysis – Major Activities

DEFINE MEASURE ANALYZE IMPROVE CONTROL

Identify Identify Collect Data to

Potential Potential Root Confirm
Causes Causes Root Causes

ING Business School

Ref Unit 3-24
Collect Data to Confirm Root Cause

Testing Theory with Data

• The data collected in the Measure step may help.
• Collect new data if existing data does not confirm
your theory.
• Use “paired data” to enable comparison between the
potential root cause and the problem statement
(effect).
• If a positive relationship exists between occurrences
of the potential root causes and changes in the
problem statement data, your theory is confirmed –
you have found a root cause.

ING Business School

Ref Unit 3-25a
Collect Data to Confirm Root Cause
(Effect data, Y)
Cause Data, X
Theory:
The more time spent on the
phone with the customer, the
larger the sale
Effect Data, Y
(Cause data, X)
X = Amount of time spent with
customer
Y = $ amount of purchase
Theory:
The higher the level of approval
needed, the longer it takes to
close the sale
X = Level of approval needed
Y = Time to close sale
ING Business School
(cont’d.)
Theory:
The more time spent with a
customer, the more likely it is we
will make a sale
X = How much time spent with
customer
Y = Make the sale? (Yes/No)
Theory:
Experienced sales staff will sell
more types of products than
inexperienced sales staff
X = Experience level of
salesperson
Y = Types of products sold
Ref Unit 3-25b
Collect Data to Confirm Root Cause
“Y”Cause
EffectData,
Data X (cont’d.)
Continuous Discrete
Attribute

Scatter Plot Stratified Frequency Plots

Continuous

X1

Ya
X2
DataY
Data,

Yb
X3
Y
X Data
Cause

Data
Effect

Stratified Frequency Plots Contingency Table

X

X1 Sub Cause
Attribute
Discrete

Present Not Present

Ya

Defect Present
X2
Yes 4 11
X3 No
Yb 19 22
XYData
Data

ING Business School

Ref Unit 3-26
 Collect Data to Confirm Root Cause
Scatter Plots (cont’d.)
When both cause and effect data are continuous
Scatter plots clarify the relationship between two
variables. They help you:
 Discover whether two variables are
related
Sale Amount (Y effect)

 Find out if changes in one variable are

associated with changes in the other

Note: Finding a relationship does not

always imply causation

Time Spent with Customer (X cause)

ING Business School

Ref Unit 3-27
Collect Data to Confirm Root Cause
Scatter Plots (cont’d.)

Positive Negative No
Correlation Correlation Correlation

Possible Possible
Positive Negative
Correlation Correlation

ING Business School

Ref Unit 3-29
Collect Data to Confirm Root Cause
Stratified Frequency Plots (cont’d.)
Attribute causal data; Continuous problem data
Theory: Variation in
Location A
training, technique, and
procedures at different
locations accounts for Time to Complete
Application
how long it takes to (all locations)
7 8 9 10 11 12 13 14 15 16 17 18 19 20 21

complete insurance Location B

application
Data: Measure time
needed to complete 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21

application at different
locations Location C
7 8 9 10 11 12 13 14 15 16 17 18 19 20 21

Minutes

7 8 9 10 11 12 13 14 15 16 17 18 19 20 21

ING Business School

Ref Unit 3-30a
 (cont’d.)
Collect Data to Confirm Root Cause
Stratified Frequency Plots
Continuous causal data; Made the
Sale
Attribute problem data
Theory: More time spent with
a customer, the more likely to 5 10 15 20 25 30 35 40 45 50 55 60 >60
Time With Customer
make a sale (in minutes)
Data: Measure time spent with
Did Not
customer and separate into Make the
two categories: Sale

 Made sale 5 10 15 20 25 30 35 40 45 50 55 60 >60

 Did not make sale Time With Customer
(in minutes)

ING Business School

Ref Unit 3-30b
Collect Data to Confirm Root Cause
Contingency Tables (cont’d.)
Attribute causal data (x); Attribute problem data (y)

“X” Cause: Poor Legibility

Present Not Present

Present
77 23
“Y” Defect: A root
cause!
Data errors
Not 11 89
Present
n = 200

ING Business School

Ref Unit 3-32
Collect Data to Confirm Root Cause
(cont’d.)
More Than One Root Cause
• What does the data tell you about the
contribution each makes to the problem?
• Select confirmed root causes that have the
greatest impact on the problem statement
to conserve resources.
Potential Contribution to
Root Causes the Problem
A 85%
B 10%
C 0%

ING Business School

Ref Unit 3-34
 Activity

Create a fishbone diagram for your

revised problem statement; Identify
potential root causes; Plan how to
confirm root causes with data.
ING Business School
Ref Unit 3-35
 Analyze Tollgate Questions
1. What process deficiencies produce wasted
cycle time in your process? Why?
2. What potential root causes were identified?
How?
3. How do you know whether one root cause
has greater impact than another?
4. How was root cause verification
demonstrated?

ING Business School

Ref Unit 3-36
 Unit Summary

1. What are the three tests to determine if a

process activity is Value-Add?
2. How does cause and effect analysis “peel
back” the layers of the causal chain to
uncover potential root causes of process
problems?
3. What are the components of a fishbone
diagram?
4. What is involved when confirming
suspected root causes?

ING Business School

Ref Unit 3-37a
 Project Components: ANALYZE
Overall objective: Identify and confirm the root
causes of the problem statement.
From Measure Step
Confirm Root Causes with Data
Scatter Plots
Identify Value Added &
Non-Value Added Steps Y
Continuous
Customer Customer Data

X
Stratified Frequency Plots
Made the Sale
Made the Sale

Brainstorm and Organize Mixed 5

Data 5 10 15 20 25
25 30
30
30 3 55 40
40 45
45 50
50
50 55
55 60 >60

Potential Causes Did Not

Did Not Make the Sale

Root Cause and Effect Diagram Make the Sale

Cause
1 Contingency Table
Level 2 Cause
5

Level 3 Cause

Sub Cause
5 10 15 20 25
25 30
30
30 33 55 40
40 45
45 50
50
50 55 60 >60
Level 1
Cause Level 1
Cause Yes No Time With Customer
Time With Customer

Level 2 Cause
Revised (in minutes)

(in minutes)

Level 1
Cause
Problem Present To
Statement Improve
Defect

Level 1 Cause
Level 2 Cause
Level 1
Attribute
Root Level 2 Cause
Cause

Not
Data Step
Cause
2 Present

ING Business School

Ref 3-37b