PROCESS MASTERY WITH

LEAN SIX SIGMA

22nndd E
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TIIO
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ED
A Practitioners Guide to the Utilisation of Modern Day
Lean Six Sigma Methodology
Written by

George Lee Sye

With additional tips and commentary by

Harry Sinko

A Soarent Publication

First published July 2004

Republished February 2009
Copyright by George Lee Sye (2003 - 2009)
All rights reserved; no part of this publication may be reproduced, stored in a retrieval system, or transmitted in any
form or by any means, electronic, mechanical, photocopying, recording, or otherwise without either the prior written
permission of the author or a license permitting restricted copying issued by the author. This book may not be lent,
resold, hired out or otherwise disposed of by way of trade in any form of binding or cover other than that in which it
is published, without the prior consent of the author.

Published by Soarent Pty Ltd

PO Box 1027,
Mt Ommaney, Queensland
AUSTRALIA, 4074
Web:

www.soarent.com.au

Email:

home@soarent.com.au

National Library of Australia Cataloguing-in-Publication entry

Author:

Lee Sye, George, 1959-

Title:

Process Mastery with Lean Six Sigma : a practitioners guide to the utilisation of modern day Lean
Six Sigma methodology. / George Lee Sye.

Edition:
ISBN:

2nd ed.
9781920875114 (pbk.)

Notes:

Includes index.

Subjects:

Bibliography.
Lean Manufacturing.
Six Sigma (Quality control standard)
Production Management.
Quality control--Statistical methods.

Dewey Number:

658.4

Printed and bound in Australia by Ligare Pty. Ltd.

Cover Designed by Chris Ransley (www.gigall.com)
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Process Mastery is a registered trademark of Soarent Pty Ltd.

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All material remains the exclusive property and copyright of Minitab Inc. All rights reserved.

Table of Contents
ABOUT THE AUTHOR .................................................................................................. 1
INTRODUCTION ............................................................................................................ 2
PART 1 - SIX SIGMA & LEAN THINKING FOUNDATIONS ......................................... 8
CHAPTER 1: QUALITY ASSURANCE VERSUS QUALITY IMPROVEMENT ............. 9
Quality .......................................................................................................................................... 9
Quality Improvement .................................................................................................................. 10
Quality Assurance (QA).............................................................................................................. 11

CHAPTER 2: SIX SIGMA & LEAN THINKING ............................................................ 14

What is Six Sigma? .................................................................................................................... 14
The Simplicity of Six Sigma - 2 Principles .................................................................................. 15
What is Lean Thinking?.............................................................................................................. 19
The Focus of Lean Thinking - 5 Principles ................................................................................. 22
Four Technical Approaches to Improvement ............................................................................. 22
The DMAIC Roadmap in Detail .................................................................................................. 27
20 Steps to Sustainable Process Improvement ......................................................................... 28
DMAIC and Traditional Project Management............................................................................. 30
The Improvement Project Component Matrix............................................................................. 31

CHAPTER 3: ORGANISING FOR LEAN SIX SIGMA PROJECT WORK................... 34

Roles and Responsibilities ......................................................................................................... 34
Project Reporting Structure ........................................................................................................ 38
Reporting Project Progress ........................................................................................................ 39
Key Learning Points ................................................................................................................... 40

CHAPTER 4: IMPROVEMENT TOOLS ....................................................................... 41

The Six Sigma Toolkit ................................................................................................................ 41

Integrating Lean Thinking with Traditional Six Sigma ................................................................ 42
The Lean & Six Sigma Toolkit .................................................................................................... 43
Tool Summary Table 1 In DMAIC Sequence .......................................................................... 44

PART 2 - IMPROVEMENT PROJECT LEADERSHIP ................................................. 53

CHAPTER 5: PROJECT LEADERSHIP ...................................................................... 54
Shifting Paradigms ..................................................................................................................... 54
The Challenge of Leading Teams .............................................................................................. 55
Working with the Team............................................................................................................... 55
Elements of Team Performance................................................................................................. 57
Meeting Roles ............................................................................................................................ 59
Meeting Tools and Techniques .................................................................................................. 60
Decision Making in a Team ........................................................................................................ 64
The Project Team Leader as Facilitator ..................................................................................... 67
Meeting Management................................................................................................................. 68
Sample Project Team Meeting Agenda...................................................................................... 72
Rating Meeting Quality ............................................................................................................... 72
Team Member Personalities ...................................................................................................... 74
Communicating to Different People............................................................................................ 76
Communication and Meaning..................................................................................................... 78
Communicating to Build Rapport & Connection ......................................................................... 78
Listening - A Total Body Rapport Building Behaviour ................................................................ 81
Physiological Rapport................................................................................................................. 84
Symbolic Rapport ....................................................................................................................... 86
Matching Internal Representation Systems................................................................................ 87
Dealing With Conflict .................................................................................................................. 92

Too Much Agreement & Too Little Agreement ........................................................................... 99

The Team Leader as Coach....................................................................................................... 99
Being a Successful Coach to Potential Leaders ...................................................................... 101
The Gift of Feedback................................................................................................................ 102

PART 3 LEAN SIX SIGMA PROJECT FOCUS ...................................................... 103

CHAPTER 6: A LEAN MENTALITY .......................................................................... 104
Lean - Simply A Way of Thinking ............................................................................................. 104
Different Approaches to Lean................................................................................................... 105

CHAPTER 7: DEFINE PHASE FOR CHAMPIONS AND PROCESS OWNERS .... 106
The Most Important Activity of Business Improvement ............................................................ 106
CORE BUSINESS PROCESSES ............................................................................................ 107
The Idea of a Value Stream ..................................................................................................... 108
Listening to Voices ................................................................................................................... 109
IDENTIFYING OPPORTUNITIES WITH S.I.P.O.C.................................................................. 110
SIPOC in Improvement Project Identification ........................................................................... 113
IDENTIFYING OPPORTUNITIES WITH VALUE STREAM ANALYSIS................................... 113
Dimensions of Value Stream Measurement............................................................................. 116
Using Value Stream Analysis in Project Identification.............................................................. 119
IDENTIFYING OPPORTUNITIES WITH QFD ......................................................................... 120
The Application of QFD ............................................................................................................ 123
Subsystem Level Houses of Quality......................................................................................... 129
Characteristics of Good Lean & Six Sigma Projects ................................................................ 130
Chartering the Project .............................................................................................................. 131

CHAPTER 8: TOOLKIT FOR CHAMPIONS & PROCESS OWNERS ...................... 134

S.I.P.O.C. ................................................................................................................................. 134

Value Stream Analysis ............................................................................................................. 134

Quality Functional Deployment ................................................................................................ 138
Project Charter ......................................................................................................................... 144

CHAPTER 9: PROJECT DEFINE PHASE............................................................... 164

The Define Phase as a Process............................................................................................... 165
Common Define Phase Tools .................................................................................................. 166
DEVELOPING THE PROJECT CHARTER (STEP 3).............................................................. 166
Finishing the Project Charter.................................................................................................... 169
Project Duration........................................................................................................................ 171
A Generic Project Plan ............................................................................................................. 172
STARTING THE PROJECT (STEP 4) ..................................................................................... 174
Operating Agreement with the Team ....................................................................................... 174
Preparing for the First Team Meeting....................................................................................... 175
Communication Planning ......................................................................................................... 177
Expanding Your Level of Thinking............................................................................................ 179
DOCUMENTING THE PROCESS (STEP 5)............................................................................ 180
Process Flowcharting ............................................................................................................... 181
Documenting The Process For Six Sigma Projects ................................................................. 183
Documenting The Process For A Lean Project ........................................................................ 188
DOS AND DONTS OF THE DEFINE PHASE ......................................................................... 189

CHAPTER 10: THE DEFINE PHASE TOOLKIT........................................................ 190

IPO Worksheet (Six Sigma Projects) ....................................................................................... 190
Process FLowcharting (Lean Projects) .................................................................................... 191
Communications Plan .............................................................................................................. 192
Meeting Agenda ....................................................................................................................... 193

CHAPTER 11: DEFINE PHASE TOLLGATE & CHECKLISTS................................. 194

Tollgate Questions ................................................................................................................... 194

Project Charter Checklist.......................................................................................................... 196
Define Phase Checklist ............................................................................................................ 197

CHAPTER 12: PROJECT MEASURE PHASE ........................................................ 198

Preparing for Analysis .............................................................................................................. 199
The MEASURE Phase as a Process ....................................................................................... 199
Common MEASURE Phase Tools ........................................................................................... 201
MEASURE PHASE FOUNDATIONS ....................................................................................... 201
Data Versus Information........................................................................................................... 201
Descriptive Statistics ................................................................................................................ 204
Measures of Central Tendency ................................................................................................ 205
Measures of Spread or Dispersion........................................................................................... 206
Skewness and Kurtosis ............................................................................................................ 208
Summary of Notations.............................................................................................................. 210
Descriptive Statistics With Excel, SigmaXL & Minitab.............................................................. 210
Interval Estimation.................................................................................................................... 215
Data Types ............................................................................................................................... 219
Frequency Distributions............................................................................................................ 221
PLANNING DATA COLLECTION (STEP 6)............................................................................. 227
Data Collection Fundamentals ................................................................................................. 227
Planning Data Collection .......................................................................................................... 228
Step 1 - Identify Key Variables ................................................................................................. 231
Step 2 - Plan Data Collection For The Primary Metric ............................................................. 233
Operational Definition............................................................................................................... 236
Identifying Stratification Variables (or Sources of Variation) .................................................... 238
Determining Your Sampling Plan ............................................................................................. 240

Step 3 - Plan Data Collection For Secondary Metrics .............................................................. 246

The Completed Data Collection Plan ....................................................................................... 248
Case Study The Coffee Shop................................................................................................ 249
ANALYSE THE MEASUREMENT SYSTEM (STEP 7) ............................................................ 254
Measurement System Variation ............................................................................................... 255
Accuracy Studies for Variable Data.......................................................................................... 256
Precision Studies for Variable Data - Gage R&R ..................................................................... 258
Desired MSA Results ............................................................................................................... 268
Dealing With Excessive Variation............................................................................................. 268
COLLECT THE DATA (STEP 8) .............................................................................................. 271
ESTABLISH BASELINE PROCESS CAPABILITY (STEP 9)................................................... 273
Probability Distributions............................................................................................................ 273
Discrete Probability Distributions.............................................................................................. 273
Continuous Probability Distributions......................................................................................... 279
Testing for Normality ................................................................................................................ 292
Process Capability with Sigma Quality Levels ......................................................................... 300
Long-Term Process Capability Indices..................................................................................... 311
Potential Capability Indices ...................................................................................................... 314
What are good Cp / Pp values? ............................................................................................... 317
Process Capability Analysis with Minitab ................................................................................. 319
Process Capability with SigmaXL............................................................................................. 323
Process Yield Calculations....................................................................................................... 325
Key Learning Points ................................................................................................................. 326
ESTABLISH BASELINE PROCESS EFFICIENCY (STEP 9) .................................................. 327
Process Efficiency Metrics ....................................................................................................... 327

CHAPTER 13: THE MEASURE PHASE TOOLKIT ................................................... 338

XY Worksheet .......................................................................................................................... 338

Data Collection Plan................................................................................................................. 339
Operational Definition............................................................................................................... 340
Estimating Proportions of a Population .................................................................................... 341
Estimating the Mean of a Population........................................................................................ 342
Process Sigma - DPMO Method .............................................................................................. 343
Process Sigma - Z Score Method ............................................................................................ 344
Process Cycle Efficiency Metrics ............................................................................................. 345
Time Value Analysis (Detailed Option)..................................................................................... 346
Time Value Analysis (Simplified Option) .................................................................................. 347

CHAPTER 14: MEASURE PHASE TOLLGATE & CHECKLISTS ............................ 348

Tollgate Questions ................................................................................................................... 348
Measure Phase Checklist......................................................................................................... 350

CHAPTER 15: PROJECT ANALYSE PHASE......................................................... 351

Forms of Analysis..................................................................................................................... 352
The ANALYSE Phase as a Process......................................................................................... 353
Common ANALYSE Phase Tools ............................................................................................ 354
EVALUATING PROCESS STABILITY (STEP 10) ................................................................... 354
Statistical Process Control ....................................................................................................... 354
Run Charts ............................................................................................................................... 357
Control Charts .......................................................................................................................... 363
Practical Subgroups versus Rational Subgroups ..................................................................... 386
LOCATING THE SOURCE OF VARIATION (STEP 11) .......................................................... 389
Methods for Graphically Representing Data ............................................................................ 390
Common Graphical Methods for Stratification.......................................................................... 395
Pivot Charts.............................................................................................................................. 399

Inferential Statistics .................................................................................................................. 402

Central Limit Theorem.............................................................................................................. 404
Validating Sources of Variation with Hypothesis Tests ............................................................ 410
Basic Hypothesis Testing with SigmaXL and Minitab .............................................................. 422
Test for Equal Variances .......................................................................................................... 422
1 Sample t Test ........................................................................................................................ 425
1 Sample Sign Test .................................................................................................................. 428
2 Sample t Test ........................................................................................................................ 429
Mann Whitney Test .................................................................................................................. 432
Paired t Test ............................................................................................................................. 433
One Way ANOVA..................................................................................................................... 435
Two Way ANOVA..................................................................................................................... 441
Moods Median Test ................................................................................................................. 442
2 Proportion Test...................................................................................................................... 444
Chi-Square Test ....................................................................................................................... 446
Practical Hypothesis Testing .................................................................................................... 450
IDENTIFYING SOURCES OF WASTE (STEP 11A)................................................................ 453
Takt Time Chart........................................................................................................................ 453
Spaghetti Diagrams.................................................................................................................. 456
Cross Functional Flowchart...................................................................................................... 458
Utilising Other Lean Tools ........................................................................................................ 458
STUDYING CAUSE & EFFECT RELATIONSHIPS (STEP 12A) ............................................. 459
The Art of Questioning in Cause Effect Analysis...................................................................... 460
Cause and Effect Diagram ....................................................................................................... 462
5 What Cause Effect Chain ...................................................................................................... 464
Cause Effect Structure Tree..................................................................................................... 465

Case Study the Coffee Shop................................................................................................. 467

VALIDATING CAUSE & EFFECT RELATIONSHIPS (STEP 12B) .......................................... 469
Tools for Examining Relationships ........................................................................................... 470
Scatter Plots ............................................................................................................................. 471
Correlation and Linear Regression Analysis ............................................................................ 472
Check Validity of the Regression Model................................................................................... 500
Analysing Graphs and Numbers .............................................................................................. 504
Logistic Regression .................................................................................................................. 506
Designed Experiments ............................................................................................................. 517
Two Way Analysis of Variance (ANOVA)................................................................................. 519
Design of Experiments (DOE) .................................................................................................. 532
Fractional Factorial (DOE)........................................................................................................ 545
Caution in Using Regression Models from DOE ...................................................................... 551

CHAPTER 16: ANALYSE PHASE TOOLKIT ............................................................ 554

Attribute Control Charts............................................................................................................ 554
Variables Control Charts .......................................................................................................... 555
Statistical Analysis Tools.......................................................................................................... 556
Hypothesis Testing Worksheet................................................................................................. 557
Takt Time Chart........................................................................................................................ 558
Spaghetti Diagram.................................................................................................................... 559
Cause Effect Diagram (Fishbone) ............................................................................................ 560
5 What Cause Effect Chain ...................................................................................................... 561
Cause Effect Structure Tree..................................................................................................... 562
Multiple Regression Summary ................................................................................................. 563
DOE Worksheet ....................................................................................................................... 565

CHAPTER 17: ANALYSE PHASE TOLLGATE & CHECKLISTS............................. 566

Tollgate Questions ................................................................................................................... 566

Analyse Phase Checklist.......................................................................................................... 568

CHAPTER 18: PROJECT IMPROVE PHASE ......................................................... 569

The IMPROVE Phase as a Process......................................................................................... 570
Common IMPROVE Phase Tools ............................................................................................ 571
Improvement Strategies For Six Sigma.................................................................................... 571
GENERATE AND SELECT SOLUTIONS (STEP 13) .............................................................. 575
A Good Six Sigma Solution ...................................................................................................... 575
Solution Generation Approaches and Tools............................................................................. 576
Shewhart-Deming PDCA / PDSA Cycle................................................................................... 576
Benchmarking .......................................................................................................................... 577
The Concept of Creativity......................................................................................................... 583
The Good Ideas Process ........................................................................................................ 589
Stating Desired Outcomes ....................................................................................................... 591
Good Questions to Focus Thoughts and Discussion ............................................................... 592
Open Up to New Ideas ............................................................................................................. 592
Organise Ideas ......................................................................................................................... 593
Decide on Final Solutions......................................................................................................... 594
Decision Approaches and Tools............................................................................................... 596
Financial Models in Decision Making ....................................................................................... 598
QUICK EFFICIENCY IMPROVEMENTS WITH LEAN (STEP 13) ........................................... 605
Creating a Lean Workplace with 6S ......................................................................................... 605
Process Balancing.................................................................................................................... 609
Generic Pull systems................................................................................................................ 612
Single Minute Exchange of Die (S.M.E.D.) .............................................................................. 614
Work Cell Optimisation............................................................................................................. 617

Total Productive Maintenance (TPM)....................................................................................... 618

MITIGATING OR ELIMINATING CONSEQUENCES OR FAILURES (STEP 14).................... 622
Mitigating Consequences of New Solutions ............................................................................. 622
Anticipating and Addressing Failures with FMEA..................................................................... 623
Mistake Proofing & Mistake Prevention.................................................................................... 638
SOLUTION IMPLEMENTATION PLANNING (STEP 14)......................................................... 639
Project Management ................................................................................................................ 639
Defining the Improvement Project ............................................................................................ 643
Work Planning and Activity Scheduling.................................................................................... 643
Microsoft Project....................................................................................................................... 654
Project Risk Management ........................................................................................................ 655
The Cultural Elements of Change ............................................................................................ 665
Engaging Stakeholders ............................................................................................................ 666
Communication Planning ......................................................................................................... 670
Force Field Analysis ................................................................................................................. 671
Piloting Solutions and Implementation Plans ........................................................................... 672
Pre-implementation Stakeholder Check-in............................................................................... 678

CHAPTER 19: IMPROVE PHASE TOOLKIT ............................................................ 680

Tools for GENERATING SOLUTIONS Brainstorming........................................................... 680
Nominal Group Technique ....................................................................................................... 681
Anti Solution Brainstorm........................................................................................................... 681
Channel Brainstorm.................................................................................................................. 682
Solution Thought Mapping ....................................................................................................... 683
Analogy Association (Process analogy) ................................................................................... 685
Tools for ORGANISING IDEAS - Removing Duplicates .......................................................... 686
Multi Voting............................................................................................................................... 687

Weighted Multi Voting .............................................................................................................. 687

Advocacy.................................................................................................................................. 688
Affinity Grouping....................................................................................................................... 688
Tools for CHOOSING SOLUTIONS - Absolute Criteria Screening .......................................... 690
Payoff Analysis......................................................................................................................... 691
Potential Failure Analysis ......................................................................................................... 691
Weighted Criteria Rating .......................................................................................................... 693
Paired Ranking......................................................................................................................... 695
LEAN IMPROVEMENT Tools Lean Improvement Strategies ............................................... 696
Process Balancing.................................................................................................................... 697
Pull Systems............................................................................................................................. 698
Single Minute Exchange of Die (S.M.E.D.) .............................................................................. 699
SMED Worksheet..................................................................................................................... 700
Work Cell Optimisation............................................................................................................. 701
Total Productive Maintenance.................................................................................................. 702
Mistake Proofing & Mistake Prevention.................................................................................... 703
Failure Mode & Effect Analysis (FMEA) ................................................................................... 704
Schedule Bar Chart .................................................................................................................. 705
Work Breakdown Structure ...................................................................................................... 706
Network Diagram...................................................................................................................... 706
PERT Worksheet...................................................................................................................... 707
Critical Path Method ................................................................................................................. 708
Responsibility Matrix ................................................................................................................ 709
Stakeholder Commitment Evaluation ....................................................................................... 710
Stakeholder Engagement Plan................................................................................................. 711
Communications Plan .............................................................................................................. 712

Force Field Analysis ................................................................................................................. 713

Project Risk Management ........................................................................................................ 714
Pilot Study Checklist................................................................................................................. 716

CHAPTER 20: IMPROVE PHASE TOLLGATE & CHECKLISTS ............................. 717

Tollgate Questions ................................................................................................................... 717
Improve Phase Checklist ........................................................................................................ 720

CHAPTER 21: PROJECT CONTROL PHASE ........................................................ 722

The CONTROL Phase as a Process........................................................................................ 723
Common CONTROL Phase Tools ........................................................................................... 724
STANDARDISE PROCESSES (STEP 16)............................................................................... 724
Document the Process ............................................................................................................. 724
Plan for Training ....................................................................................................................... 725
MONITOR PROCESS PERFORMANCE (STEP 17) ............................................................... 726
Developing a Monitoring Plan .................................................................................................. 726
Document the Process with SIPOC ......................................................................................... 727
Process Mapping...................................................................................................................... 729
The Customer as the Central Theme ....................................................................................... 733
Defining Customer Requirements ............................................................................................ 738
Case Study The Coffee Shop................................................................................................ 754
Identifying and Selecting Measures ......................................................................................... 755
Performance Monitoring Plan................................................................................................... 763
CONTROL PROCESS PERFORMANCE (STEP 18) .............................................................. 765
Choosing a Method of Control.................................................................................................. 765
Control Feedback Loops .......................................................................................................... 766
Visual Process Controls ........................................................................................................... 767
Statistical Process Control ....................................................................................................... 772

PROJECT CLOSURE .............................................................................................................. 776

CHAPTER 22: THE CONTROL PHASE TOOLKIT ................................................... 777

Training Plan ............................................................................................................................ 777
SIPOC ...................................................................................................................................... 778
Activity Flowchart ..................................................................................................................... 779
CTQ Tree Diagram................................................................................................................... 780
Customer Comments Worksheet ............................................................................................. 781
Customer Priorities Worksheet................................................................................................. 782
Cause Effect (CE) Tree Diagram ............................................................................................. 783
Cause Effect (CE) Matrix.......................................................................................................... 784
Performance Monitoring Plan................................................................................................... 786
Process Performance Control Plan .......................................................................................... 787

CHAPTER 23: CONTROL PHASE TOLLGATE & CHECKLISTS ............................ 789

Tollgate Questions ................................................................................................................... 789
Control Phase Checklist ........................................................................................................... 791

CHAPTER 24: TERMS AND DEFINITIONS .............................................................. 792

Terms and Definitions .............................................................................................................. 792

PART 4: APPENDICES ............................................................................................. 800

Appendix A - Exponential Equations ........................................................................................ 801
Appendix B - Table of Variable Control Chart Factors ............................................................. 802
Appendix C - Process Sigma Conversion Table..................................................................... 803
Appendix D - Zst to DPMO Conversion Table........................................................................... 804
Appendix E - Z Table for Normal Distribution........................................................................... 806
Appendix F - Critical Values for t Distribution........................................................................... 808
Appendix G Answers to Problems......................................................................................... 809

Appendix H Lean Projects and the 20 Step DMAIC Roadmap ............................................. 810
Appendix I - Accelerated Projects / Kaizen .............................................................................. 811
Appendix J - Bibliography......................................................................................................... 817
Appendix K - Index ................................................................................................................... 819
Visionary, Author, Speaker, Performance Coach..................................................................... 826
Other Books and Audio Products by George Lee Sye ............................................................. 828
Performance Education and Coaching Services...................................................................... 828
Contact Details ......................................................................................................................... 829