Managing Risks in Six Sigma
Implementation
LSS IQPC Conference, Singapore
17-20 May 2010
18 May 2010, 4.40pm, Sheraton Towers
Lee Chai Erl/IMS Health Asia
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Just to know you better
Is this NEW to you and your Organization?
DfSS or DMAIC?
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Agenda
What is Six Sigma?
Types of Six Sigma
Understanding the needs of stakeholders
Leveraging on tools for effective risk
management
Project management for Six Sigma
implementation
Question and Answer (10min)
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What is Six Sigma?
A number
Variation reduction
Methodology
Managing risks
Philosophy
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Types of Six Sigma
Define-Measure-Analyse-Improve-Control
Design for Six Sigma
(Define-Identify-Design-Optimise-Verify)
Lean Sigma
etc
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Understanding the needs of
stakeholders
Who are the stakeholders
Why are they important
What can we do to achieve the desired
stakeholders enrollment
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Who are the stakeholders?
You?
Me?
Customers?
CEO?
Suppliers?
Functions?
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Boss?
Differing Expectations from different
Stakeholders
Managing their expectations
differentiates a success from a failure
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Managing expectations is key
... by bridging different expectations and reducing
uncertainty, anxiety or fear of the unknown
Understand what each stakeholder is looking forward to
in the project and try to achieve that
Made more convincing by regular updates &
Engaging them in decision making
Change Management
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Leveraging on tools for effective risk
management
What are the Risks?
Where are they from?
What are the tools available within the Six Sigma
framework for managing risks?
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Risks
Resources (time, manpower, $$$, etc)
Job security
A flavour of the month
Pressure to deliver
Living up to expectations
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Risk Sites
Define
Measure
Cause/s identification
Improve
Indicators
Analyse
People
Scope
Business case
Timeline
Solutions
Control
Ways of sustaining the gains
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Minimizing Risks
You dont know what you dont know
Six Sigma involves maximizing knowledge
The ability to manage risk in what is unknown is an
important factor
DMAIC tools help manage the risk of the unknown they
are self-correcting or insurance tools
However, they do not directly appeal to the quest for
knowledge and the promise of power, thus they tend to be
mistakenly discarded when we try to streamline the
problem solving process
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Get to the tools in
Lee Chai Erl/IMS Health Asia
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Define : Charter
Charter Development
Vague problem statement
Poorly considered team selection
Careless estimation of financial or strategic impact
When tools are not addressed properly, the entire focus,
direction of the project are at risk
Lack of attention to effective team selection will affect
team facilitation and decisions
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Define : Metrics
Metrics Definition
What gets measured gets managed
Primary n secondary metric (as an insurance)
Effective pilots and implementation among team
members and stakeholders to review findings and
proposed solutions can help promote the correct focus
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Define : Stakeholder Analysis
Risks related to change management and acquisition of
resources
Employed to understand the climate
Provide guidance for ensuring resistance is minimised
Exclusion of this tool will fail to address potentially
detrimental organizational resistance
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Define : Voice of the Customer
Illusion that we know the customers!
Produced misguided and dangerous solutions
Requirements failure, released design failures and
customer dissatisfaction especially evident in DfSS projects
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Define : Team Facilitation
Poor decisions made without meetings
Increase risks of not knowing root causes
Solutions not well conceived
No buy-in from people affected by the decisions
Effective team facilitation is instrumental in creating an
effective list of critical process inputs in Measure
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Measure : MSA
BAD data can kill the project!
Verification of operational definitions
Logical inquiries and analyses of the data collection process
Sample audits for accuracy to gage R&R
Basic investigation of the data collection systems
Value of the it brings to ensuring the integrity of decisions
Other than team facilitation, this is an important aspect
which is often underappreciated as it does not fix
processes or products.
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Measure : FMEA
Relentless attention to detail helps train people to think
critically about the processes
A discovery tool by first revealing process opportunities
Increases what is known about the process at the same
time; ensures that what is unknown is kept minimal
Discover, validate or prioritise potential root causes
Critical thinking in FMEA ensures that all bases are
covered
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Analyse : Analyse Plan
Basic guidance document that is typically produced at
the beginning of the phase
Provide direction by way of a documented trail of results
and conclusions
Drive decision making in the presence of data/evidence
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Improve : Mistake Proofing
Other than training, mistake proofing is essential
Innovate or think out of the box for ideas that would not
allow failure to occur
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Improve : Pilot Runs
Discover the unknown with runs
Assist in the identification of potential risks in a solution
Simulation is cheap!
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Control : Control Plan
Self checking and self correcting system
Application of solutions (implemented correctly,
maintained properly and optimised through additional
learning)
Tipping points identified and reviewed periodically
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Control : Project Post Mortem
Self correcting but never utilised
Review and actions
Feedback and fine-tune
Lessons learnt
Team review
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Risk Management
2 key elements
Uncertainty
Impact in terms of potential loss (if it happens)
It is continuous process with key steps of:
Identify risks
Assess each risk
Rank all risks according to their severity
Plan for risk mitigation and contingency on the basis
of outcome
Monitor each risk
Control deviations (if any) from risk mitigation plan
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Identify Risks
Start of each project on the elements of
Cost
Specifications
Time
Program/Project Management Process in place
Tool to assure that project delivers outcome
Communication! Communication! Communication!
Make status visible!
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Assess Risks
Determine the uncertainty, the impact and the
first risk
Probability of occurrence
Impact (should it happen)
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Effectively managing risks in:
All phases by giving due consideration in:
Define where Charter helps in focus; stakeholder
analysis in overcoming organizational resistance to
change
Measure with clear operational definitions for
alignment
Analyse with FMEA to mitigate associated risks
Improve in which new processes are mapped and
explored with feasible studies
Control with sustaining the gains in mind
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FMEA as a Thinking Tool for Analysing
Risks in a Six Sigma Project
Process / Product
Failure Modes and Effects Analysis
(FMEA)
Process or
Product Name:
Prepared by:
Responsible:
FMEA Date (Orig) ______________ (Rev) _____________
Potential Causes
What causes the
Key Input to go
wrong?
O
C
C
D
E
T
Current Controls
What are the existing controls and
procedures (inspection and test)
that prevent either the cause or the
failure mode? Should include an
SOP number.
R
P
N
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Actions Recommended
Resp.
Actions Taken
What are the actions for
What are the completed
reducing the occurence of Who is
responsible actions taken with the
the cause, or improving
for the
recalculated RPN? Be sure
detection? Should have
to include completion
actions only on high RPN'srecommended
action?
month/year
or easy fixes.
S
E
V
O
C
C
D
E
T
R
P
N
How Severe is the
effect to the
custotmer after
How often does
cause or FM occur
after actions?
How well can you
detect cause or FM
after actions?
After actions
What is the impact on the Key
Output Variables (Customer
Requirements) or internal
requirements?
S
E
V
How well can you
detect cause or
failure mode?
What is the
Key Process
Input?
In what ways
does the Key
Input go
wrong?
Potential Failure Effects
How often does
cause or failure
mode occur?
What is the
process step
Key Process
Potential
Input
Failure Mode
How Severe is the
effect to the
customer?
Process Step
Page ____ of ____
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Project management for Six Sigma
implementation
Ingredients for a good recipe
Trust
Tried and Tested method
Setting milestones
Getting commitment
The success story
Change Management
What are the checkpoints? Control points?
Use of a success story to garner interest
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Areas of Focus in Managing Risks at
Different Phases
Before Six Sigma, project risks are managed in
organizations. The deliverables and tools form part of the
risk management process.
Business
Case
Concept
Prototype
Trial Run
Market
Release
Market
Requirements
Detailed
requirements
Gaps closure
Data
collection/review
Customers
Timelines
Capability
Risks
management
User feedback &
Actions
Goals, etc
Targets, etc
Mistake
Proofing
Indicators
established
User acceptance
Define
Identify
Design
Optimize
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Verify
Monitor
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Recipe for a Successful Six Sigma
implementation
Managing expectations
Doing more with less
Placing the priorities
Atypical training program (consultant, program, etc, no
guaranteed results. Running alongside helps)
Some food for thought questions
Do we need to impress the whole world? What is best?
What are the pressing issues? The quickwins?
Motivation balancing with work needs?
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Questions?
Acknowledgements &
Thank You
Lee Chai Erl/IMS Health Asia
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