Unit 1 Notes
1. Quality Definition
Quality is defined from the customer’s point of view as anything that enhances their satisfaction.
According to ISO, Quality is defined as “Degree to which a set of inherent characteristics, of a
product or service, fulfil requirements”
The essence of quality revolves around meeting customer expectations through four key activities:
• Understanding customer requirements: This involves actively listening to what customers
truly desire from a product or service. It is about understanding their needs, preferences,
and any specific criteria they expect to be fulfilled.
• Designing products and services that satisfy those requirements: With a clear
understanding of customer requirements, the next step is to translate that understanding
into tangible products or services. This phase focuses on crafting offerings that precisely
match or exceed what customers expect, ensuring they provide value and meet needs
effectively.
• Developing processes capable of producing those products and services: Quality is not just
about the result but also about the consistency and efficiency of the processes used to
create that result. Developing robust processes means establishing methods and systems
that can reliably produce high-quality products or services consistently.
• Controlling and managing those processes for consistent delivery: Once processes are in
place, it is crucial to monitor and manage them to ensure they operate at their full
potential. This involves implementing controls, checks, and measures to maintain
consistency, identify and rectify any deviations or issues, and continuously improve
processes for better outcomes.
2. Lean sigma & the principles of Lean Sigma
Lean Sigma is a management philosophy and methodology focused on maximizing efficiency,
minimizing waste, and continuously improving processes. Lean Sigma aims to deliver enhanced value
to customers by eliminating non-value-added activities, reducing lead times, and fostering a culture
of continuous improvement within an organization.
Five Core Principles of Lean Sigma:
• Define Value: Value is what customers are willing to pay for. Discovering their actual or latent
needs, even in cases of novel products, is crucial. Techniques like interviews, surveys, and
analytics help uncover preferences. This understanding guides product/service development
in terms of features, delivery, and pricing.
• Map the Value Stream: Identify and map activities contributing to customer value. Eliminate
or reduce non-value-added processes. Two types of waste are identified: non-value-added
but necessary and pure waste. Streamlining processes ensures customers receive what they
want while minimizing production costs.
• Create Flow: After removing waste, ensure smooth flow without interruptions or delays in
remaining processes. Strategies include breaking down steps, reconfiguring production,
levelling workload, creating cross-functional departments, and training employees to be
versatile.
• Establish Pull: Minimize inventory and work in process (WIP) by adopting a pull-based
system. Just-in-time delivery and manufacturing ensure products are created as needed and
in the required quantities. This system is customer-driven, aligning production with customer
needs.
• Pursue Perfection: Prevention of waste is achieved by identifying value, mapping the value
stream, creating flow, and establishing a pull system. However, the pursuit of perfection is
crucial. It embeds Lean thinking and continuous improvement in the organizational culture,
making every employee strive for perfection while adapting to customer needs. The
company becomes a learning organization, consistently seeking ways to improve.
In summary, Lean Sigma revolves around these five core principles, emphasizing customer value,
value stream mapping, creating flow, establishing pull, and continuously pursuing perfection through
incremental improvements. These principles collectively guide organizations in achieving operational
excellence and delivering superior value to customers.
3. 5 S in Lean
Lean Six Sigma is a team-focused managerial approach that seeks to improve performance by
eliminating resource waste and defects.
The five S’s represent the five steps, based on the original Japanese words of seiri, seiton, seiso,
seiketsu, and shitsuke, but translated into English to sort, set, shine, standardize and sustain.
• Sort (Seiri): Telling the difference between unnecessary and necessary things and removing
what is not needed. This process includes classifying and tagging items and removing broken
or outdated items from the work area.
• Set (Seiton): Seiton is the practice of storing things in an orderly fashion so the correct item
can be chosen quickly and efficiently, easily accessible to all, thereby eliminating waste.
• Shine (Seiso): Create and maintain a clean workspace without trash, dust, or dirt, so
problems (spills, leaks, damage, overflow) can be more easily identified. This process
includes keeping the area well-lit, keeping equipment and tools clean, making cleaning a
daily activity, and allowing only one work activity per workstation.
• Standardize (Seiketsu): This stage involves creating standards for a clean workplace.
Standardization includes a set of best practices through visual management, maintaining
consistency across all areas, ensuring that abnormalities are visible to management, and
creating processes for maintaining standards, including setting up roles and responsibilities.
• Sustain (Shitsuke): It involves implementing habits and behaviors designed to maintain the
company’s established standards over the long term and ensuring that the efforts to keep
the workplace organized remain the key to managing the process for success. This stage
involves a leader committed to establishing and maintaining responsibilities, everyone being
“all in” and making these activities a habit, addressing the causes rather than the symptoms,
regular reviews and audits, and continuous 5S improvement.
4. 7 Wastes in Lean
The 7 wastes, known as ‘muda’, are the various forms of inefficiency that the lean production
systems seek to eliminate. Waste, by definition, is something that adds no value. By removing these
forms of inefficiency, you can boost your manufacturing plant’s productivity and return-on-
investment.
In Japan, waste is generally known as ‘muda‘, meaning wasted effort. The most common way people
remember the 7 Wastes in English is with the acronym TIMWOOD (Transportation, Inventory,
Motion, Waiting, Over Processing, Over Production, Defects)
• Transportation: Transportation is the process of moving something from one place to
another. Transportation itself does not add any value to the customer, so it should be
minimized as much as possible. This can be done by making plants closer together and
minimizing the cost of transportation.
• Inventory: This is the waste that is associated with unprocessed inventory. This includes the
waste capital tied up in excess stock, wasted transport used moving the inventory, the light,
and heating used to store the capacity and the containers used to store the excess product.
Excess inventory can also hide other forms of inefficiencies that are produced by your
current workflows.
• Motion: Motion wastage is any movement made that could have been used for another
purpose. This results in a form of wastage as it is unnecessary energy and time. Wasted
motion can be anything from a factory worker bending over to pick something up, to an
unnecessary trip made by a machine.
• Waiting: This is any form of waiting that must be done by either staff or machinery to
complete a task. This will frequently happen when one process along the production line
takes longer than it needs to, resulting in wasted worker time. Employees can be paid when
not being productive, and materials can be spoilt when waiting for production.
• Over Processing: Lean manufacturing relies on products delivering value to the customer, but
not over-engineering any product. Any work that doesn’t need to be done, shouldn’t be
done. Over-processing is essentially delivering more value than is needed by the customer.
• Over Production: Overproduction is the most obvious form of manufacturing waste. Not only
does it lead to depleted raw materials, but also to wasted storage and excess capital tied up
in unused products. The process of disposal also creates wasted human effort and can pose
the risk of exposing your workers to harmful waste materials. The aim is to only produce
what is required by the customer. Lean production relies on the ‘just-in-time’ principle,
meaning your product should be created at the time it is needed, and not before.
• Defects: Defects refer to a product not meeting the specifications expected by the customer.
Defects lead to a huge waste of time, starting in the form of paperwork. The product then
needs to be disposed of and reproduced, which also costs time and money. Defects also lead
to lost customers and reputation. It is, therefore, an exponentially costly form of waste.
5. Six-sigma
Six Sigma is a methodology for process improvement developed by a scientist at Motorola in the
1980s. Six Sigma practitioners use statistics, financial analysis, and project management to achieve
improved business functionality and better quality control by identifying and then correcting
mistakes or defects in existing processes.
The term Six Sigma originated in manufacturing as a means of quality control. Six Sigma quality is
achieved when long-term defect levels are below 3.4 defects per million opportunities (DPMO).
The five phases of the Six Sigma method, known as DMAIC, are defining, measuring, analyzing,
improving, and controlling.
6. Lean Six-sigma
Lean Six Sigma is a team-focused managerial approach that seeks to improve performance by
eliminating waste and defects while boosting the standardization of work.
It combines Six Sigma methods and tools and the lean manufacturing/lean enterprise philosophy,
striving to reduce the waste of physical resources, time, effort, and talent while assuring quality in
production and organizational processes. Any use of resources that does not create value for the end
customer is considered a waste and should be eliminated.
7. DMAIC Overview
DMAIC refers to a cycle of process improvement that is data-driven and aims at improving,
optimizing, and stabilizing business processes and designs. It is an integral part of a Six Sigma
initiative. By using DMAIC, organizations can identify and address the root causes of problems,
improve processes, and achieve better outcomes, regardless of whether they are formally practicing
Six Sigma or not.
• Define Phase:
o Review Project Charter
o Validate problem statement and goals
o Validate Voice of Customer and Voice of Business
o Validate Financial benefits
o Validate high level value stream map and scope
o Create communication plan
o Select and launch team
o Develop a project schedule
o Complete Define Gate
A successful Define phase helps you move forward with clear, well-defined objectives
and timeline for project completion.
• Measure Phase
o Value Stream Map for deeper understanding and focus
o Identify key input, process and output metrics
o Develop data collection plan
o Validate measurement system
o Collect baseline data
o Determine process capability
o Complete Measure Gate
The use of visual management tools such as control charts, bar charts, and run
charts etc. can help you achieve better results at this stage
• Analyze Phase
o Determine critical inputs
o Identify potential root causes
o Reduce list of potential root causes
o Confirm & estimate the impact of root cause effect on output
o Prioritize root causes
o Complete Analyze Gate
After this phase, you will be able to capture and document all opportunities for
improvement successfully, and your plan of action will start taking shape.
• Improve Phase
o Develop potential solutions
o Evaluate, select, and optimize best solutions
o Develop “to-be” Value Steam Map
o Develop and implement pilot solution
o Confirm attainment of project goals
o Develop full-scale implementation plan
o Complete Improve Gate
• Control Phase
o Implement mistake proofing
o Develop SOPs, training plan and process controls
o Implement solution and ongoing process measurement
o Identify opportunities to apply project lessons
o Complete Control Gate
o Transition monitoring / control to process owner
This phase continues until new opportunities for improvements arise, and then, the
DMAIC cycle runs from start all over again.
8. Cost of Quality / Cost of Poor Quality
Cost of quality is a method for calculating the costs companies incur ensuring that products meet
quality standards, as well as the costs of producing goods that fail to meet quality standards.
It incorporates all associated costs with the quality of a product, from preventive costs intended
to reduce failures, cost of process controls to maintain quality levels, and the costs related to
both internal and external failures
• Prevention Cost: Prevention costs are the costs created from the effort to reduce poor
quality. Examples are designing the products so that they will be durable, training employees so
they do a good job, certifying suppliers to ensure that suppliers provide quality in products and
services, conducting preventive maintenance on equipment, and documenting quality
procedures and improvements.
• Appraisal Cost: The appraisal costs can be regarded as the costs that the business incurs
when it works towards identifying defective items. Appraisal costs include the inspection and
testing of raw materials, work-in-process, and finished goods.
• Internal Failure Cost: This cost occurs when quality defects are discovered before they reach
the customer. Examples of internal failure costs include scrapping a product, reworking the
product, and lost productivity due to machine breakdowns or labor errors.
• External Failure Cost: External failure costs when the defect is discovered after it has
reached the customer. They include warranty claims, product returns, and the potential loss of
future business.
9. Process Mapping
A process map is a planning and management tool that visually describes the flow of work.
The purpose of process mapping is for organizations and businesses to improve efficiency.
Process maps provide insight into a process, help teams brainstorm ideas for process improvement,
increase communication and provide process documentation. Process mapping will identify
bottlenecks, repetition, and delays.
They help to define process boundaries, process ownership, process responsibilities and
effectiveness measures or process metrics.
10. Problem Statement / Goal Statement
A Six Sigma problem statement articulates the central problem the project will solve. The statement
quantifies an existing process issue. A problem statement is a concise and clear description of an
issue or challenge that needs to be addressed. It serves as a roadmap for problem-solving and
decision-making, helping individuals and teams define the scope of their work and focus on the most
critical aspects of a problem.
Tips for defining a problem statement:
• Describe briefly
• Avoid technical jargon
• Quantify the problem, think quantitative and not qualitative
• Explain the cost of the problem
• Define the scope
A Six Sigma goal statement pinpoints the project’s target and articulates what will occur once the
team solves the problem. This portion of the project charter should include quantifiable, measurable
information.
11. Pareto Chart
A Pareto Chart is a graph that indicates the frequency of defects, as well as their cumulative impact.
Pareto Charts are useful to find the defects to prioritize in order to observe the greatest overall
improvement.
These charts are often used to identify areas to focus on first in process improvement. Pareto charts
show the ordered frequency counts of values for the different levels of a categorical or nominal
variable. The charts are based on the “80/20” rule. This rule says that about 80% of the problems are
the result of 20% of causes. This rule is also called the “vital few and trivial many.” Again, the idea is
that you can focus on a vital few root causes of the problem and ignore the trivial many.
A Pareto chart helps a team focus on problems that offer the greatest potential for improvement, by
showing different problems' relative frequency or size in a descending bar graph, which highlights
the problems' cumulative impact.