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Operational Excellence, or OpEx, is the goal of improved business performance. It usually means using lean manufacturing techniques, made popular by Toyota with their Toyota Production System or TPS. For many organizations, OpEx is the set of TPS “tools” that assist in the identification and steady elimination of waste, or ‘Muda’ in Japanese terminology, and the improvement of quality in production time and costs. The eight wastes as defined by Shigeo Shingo of Toyota are:

  1. Overproduction
  2. Long wait times
  3. Excess transportation
  4. Variable processing methods
  5. Excess inventory
  6. Too much motion
  7. Too many defects
  8. Unused human creativity
Origins of OpEx

In the early 1970s, Dr. Joseph M. Juran was one of the few experts at the time that was teaching Japanese leaders how to improve quality. As more and more companies began to adopt the methods of Juran, Deming and others Toyota’s OpEx movement grew. Today, many manufacturing companies use OpEx as its sole purpose to create lean operations.

OpEx began in the early 1980s as a United State response to the quality crisis. It was created by Japanese organizations which enabled their products to outperform many US and European products, causing many organizations to lose market share and even go out of business.

Core Principles of OpEx

The basis of OpEx is best articulated by principles in the Juran and Shingo Models.

The Juran Model Guiding Principles:

  1. Grasp Juran’s universal principles that form the basis to answer the question, “what do we need to do differently than we are doing today?”
  2. Move your culture from thinking about quality as a product attribute (little q) to quality as a great customer experience (Big Q).
  3. Understand when and how to engage leadership & the workforce to drive performance.
  4. Build an effective and efficient change infrastructure complete with a set of methods
  5. Drive business process  effectiveness and agility.
The Shingo Model
  1. Focus on process, and all outcomes are the consequence of a process.
  2. Embrace scientific thinking. Innovation and improvement are the consequence of repeated cycles of experimentation and learning.
  3. Flow and pull value. Value for customers is maximized when it is created in response to real demand and a continuous and uninterrupted flow. Anything that disrupts the continuous flow of value is waste.
  4. Ensure quality at the source. Perfect quality can only be achieved when every element of work is performed perfectly the first time and every time. When and if errors occur, they must be detected and corrected at the point and time of their creation.
  5. Seek perfection. Perfection is an aspirational goal that is not likely to be achieved, but the pursuit of which creates a mindset and culture of both continuous and radical improvement.

Operational Excellence is an effective means to change a culture (typically in production organizations.) OpEx programs have a common set of principles but may have different set of methods and tools based on organizational maturity and need.

The post Introduction to Operational Excellence (OpEx) appeared first on Juran.

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Who Was W. Edwards Deming?

Edwards Deming was an American statistician, business professor and engineer who designed the ‘System of Profound Knowledge’ and devised a list of fourteen points for quality improvement in management. His work still carries significant influence to this day, and he is considered one of the leading proponents of management philosophy.

Although his work is cited around the world, Edwards Deming is most notable for his influence on Japanese business. His theories were applied at manufacturing companies across Japan, and led to hugely increased productivity, earning him an excellent reputation for reducing expenses and increasing productivity.

Edwards Deming’s achievements in business management led to a number of significant honours – most notably, in 1960 he was awarded Japan’s Order of the Sacred Treasure (Second Class) for his services to the country’s economic resurgence. In 1991, two years before his death, he was inducted into the Automotive Hall of Fame in New York.

The System of Profound Knowledge

Edwards Deming’s ‘System of Profound Knowledge’ works on the principle that every business is made up of related people and processes who work together, and that the success of the system depends on the ability to manage those components successfully. He theorized that there were four elements to understand in order to improve the effectiveness of a business:

  • Appreciation of the system (understanding the various processes of the business)
  • Knowledge of variation (understanding how and why quality may vary within the business)
  • Theory of knowledge (understanding how your workers act and think based on what they believe to be true)
  • Psychology (understanding the concept of human nature that instructs your workers’ beliefs and motivations)
What are Deming’s 14 Points for Management?

As well as his System of Profound Knowledge, Deming also presented 14 management principles that he believed could improve efficiency in business, encouraging a holistic approach that encompasses not only business ideas, but concepts centring on how humans operate as well.

  1. Create constancy of purpose by continually looking for ways to improve both products and services, in order to become/remain competitive.
  2. Recognize that the new philosophy of management imported from Japan, prioritising quality above all else, is key. Your business must welcome innovation and change in order to improve.
  3. Cease dependence on inspection – strive to ensure products and services are of excellent quality throughout the process, rather than relying on inspection to highlight faults or inefficiencies.
  4. End ‘lowest tender’ contracts – while this method may save money in the short-term, in the long-term it is better to build relationships with specific suppliers that you can rely on, ensuring a high quality of service.
  5. It is essential that you continually seek out problems – by constantly evaluating and ironing out creases in your processes, you can maximize productivity and minimize waste of both time and money.
  6. Institute training on the job – training is key to a successful business, and dedicated development of your staff allows them to improve their efficiency and understanding of how your business works.
  7. Institute supervision as part of your business plan – managers should be able to supervise operations effectively in order to ensure both employees and production lines work efficiently.
  8. Whether fear of failure, fear of reprisals or fear of management, fear is unhelpful to the success of your business. Drive out fear by encouraging communication, respect and teamwork at all levels of your business.
  9. Break down barriers between departments and hierarchies in order to ensure everyone in your business has a deeper understanding of how each part of the company works – better cooperation will naturally lead to better efficiency.
  10. Eliminate exhortations – Positive slogans and warnings are intended to motivate, but usually have the opposite effect. If morale is low or targets are missed, it is usually due to systemic issues rather than the fault of employees.
  11. Eliminate targets – demanding minimum quotas places an emphasis on quantity of production rather than quality, which can lead to mistakes.
  12. Employees should enjoy their work and take satisfaction from a job well done. Permit pride of workmanship in order to raise employee morale.
  13. Institute education – tying in with the point about training on the job, educating your employees is essential to an effective business. Making training and self-development a fundamental part of an employee’s job allows them to reach higher standards and improves morale.
  14. The transformation is everyone’s job – recognize that improving your business is the responsibility of everyone at the company, not just management’s, and that your management can give each employee the stimulus to increase efficiency in their individual areas.
The Deming Prize

The Deming Prize is an award given to individuals who have successfully integrated Total Quality Management (TQM) into their business, or have contributed to the advancement of the concept of quality. Established in 1951 and named after W. Edwards Deming in recognition of the huge impact he had on quality control in Japan, the award is usually reserved for Japanese companies – although worldwide companies are now eligible.

The post W. Edwards Deming: From Profound Knowledge to 14 Points for Management appeared first on Juran.

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Juran Blog by Dr. Joseph A Defeo - 1w ago

Today, the term “quality control” often means quality control and compliance. The goal is to comply with critical to quality requirements and international standards or regulatory authorities such as ISO 9000. In Japan, the term “quality control” retains a broader meaning. Their “total quality control” is equivalent to the term “business excellence.” In 1997, the Japanese Union of Scientists and Engineers (JUSE) adopted the term Total Quality Management (TQM) to replace Total Quality Control (TQC) to more closely align themselves with the more common terminology used in the rest of the world.

Quality Control (Process Control & Regulatory)

Quality control is the third universal process in the Juran Trilogy.

The term “control of quality” emerged early in the twentieth century (Radford 1917, 1922). The concept was to broaden the approach to achieving quality, from the then-prevailing after-the-fact inspection (detection control) to what we now call “prevention (proactive control).” For a few decades, the word “control” had a broad meaning, which included the concept of quality planning. Then came events that narrowed the meaning of “quality control.” The “statistical quality control” movement gave the impression that quality control consisted of using statistical methods. The “reliability” movement claimed that quality control applied only to quality at the time of test but not during service life.

Why is Quality Control Needed?

When designing a product we create features to satisfy the customer needs. Quality control is the method carried out every day to assure we are making and delivering the product or service to the right targets. We maintain control of product features, or key product characteristics, required to meet customer needs. This consists of a system of product and process controls, which can provide stability to the operating process. A key product characteristic one that controls anticipated variation could significantly affect a product’s safety, compliance to government regulations, performance, or fit.

Quality Control Tools & Techniques

Quality control takes place by use of a simple feedback loop.

The progression of steps in Figure is as follows:

  1.  A sensor is “plugged in” to evaluate the actual quality of the control subject—the product or process feature in question. The performance of a process may be determined directly by evaluation of the process feature, or indirectly by evaluation of the product feature—the product “tells” on the process.
  2. The sensor reports the performance to an umpire. The umpire may be a computer or a person.
  3. The umpire also receives information on the quality goal or standard.
  4. The umpire compares actual performance to standard. If the difference is too great, the umpire energizes an actuator.
  5. The actuator stimulates the process (whether human or technological) to change the performance so as to bring quality into line with the quality goal.
  6. The process responds by restoring conformance.

Quality control maintains whatever was planned or designed. The QC methods enable an organization to reduce risk  which could lead to a failure or an injury or even death.

The post What is Quality Control? appeared first on Juran.

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Juran Blog by Dr. Joseph A Defeo - 2w ago

What is Design Thinking?

Design thinking is the cognitive, strategic and practical process behind the development and improvement of products, services, applications and more, and encompasses a range of analytical processes including:

  • Audience research
  • Empathetic analysis
  • Situational and contextual analysis
  • Ideation
  • Problem framing
  • Prototyping
  • Experimentation

Today, with technology playing a major role in designing innovative solutions to solve problems, newly-developed design thinking approaches have emerged. The Juran approach to design thinking consists of utilizing a simple methodology to:

  • Develop new goods and services
  • Develop new processes to deliver those goods and services
  • Solve complex problems that do not lend itself to traditional problem-solving methods and faster.

Each method can be used together or separately to meet the design charter.

It starts and ends with the customer. Every new good or service in development has some amount of trade-off involved. If there are multiple customers, they may have conflicting needs with each other and with stakeholders such as business functions like sales, marketing, finance, etc. Even the same customer may have needs that compete with each other.

Capacity and speed compete with the cost of operation. Capacity can compete with speed. Flexibility and feature-rich offerings may have reduced ease of use, and so on. By discovering the customers and finding hidden needs, new and innovative features can be “designed in” while understanding the process capability of the operation to assure highly profitable and saleable new goods and services.

The Juran method of design thinking includes a range of tools intended to make these tradeoffs explicit and optimal for the customer and the stakeholders. Most of the tools are non-statistical and relate more to understanding customer behavior. The Juran approach to design thinking sets strong expectations for creative approaches to functional design, features, and setting targets and goals.

Design Thinking Methodology – How Do We Do It?

This method extends beyond Agile Design thinking and provides a simple 3 or 6 phase approach.

The first three phases: Define – Discover – Design Product Features are used to create innovative goods and services and the next three are focused on creating innovative processes or solve process problems that may prevent the innovation goods or services from being delivered to customers.

The second three phases: Design Process Feature – Develop Controls – Deliver to Operations focuses on design or redesign of operational processes to deliver new or existing goods and services.

When all six phases are used in order, an innovative good or service can be developed alongside the processes to deliver them.

Why is Design Thinking essential?

For the most part of the 1990s thru 2010, most design methods such as design for six sigma, agile design, and Juran’s quality by design consisted of multi-functional “design teams” working to improve the speed of innovation and taking steps early in the design process to assure that products and services were designed with few defects and be saleable at a fair margin.

The best of these methods, such as Juran’s Quality By Design, focused on “discovering hidden needs of often overlooked customers and designing innovative features to meet those needs. The customer in Juran’s definition went beyond the typical customer – the user or consumer – to include hidden customers such as stakeholders, buyers, operations and the supply chain to assure products and services, and subsequently, processes, were proven to work before shipping or delivering the products and services to those customers.

For more information on design thinking methodology and how Juran can use it to improve your business, please get in touch with the team, or take a look at our programs and workshops here.

The post Design Thinking in Practice appeared first on Juran.

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Juran Blog by Dr. Joseph A Defeo - 1M ago

When looking to define Continuous Improvement, one will find that it is used in multiple ways to describe multiple methods. In some instances, it could be used to describe the process of carrying out daily kaizens (Japanese for ‘improvement’); improvement through quality circles; or small, daily incremental improvements. At Juran, we define Continuous Improvement, or CI, as the need to continuously create ‘breakthroughs’.

There are two types of breakthrough, aimed at both sides of the definition of quality:

  1. Achieving higher-quality product and service features to provide customer satisfaction and revenue for the producing organization.
  2. Achieving freedom from failures to reduce customer dissatisfaction and non-value added waste.

Breakthrough is applicable to any industry, problem or process. For the producing organization, reducing product failures – and therefore reducing costs – is a target for breakthrough.

Many organizations create extensive CI programs to reduce excess failures and deficiencies. They may be implemented to drive the following actions:

  • Increase the yield of production processes
  • Reduce error rates of administrative reports
  • Reduce field failures
  • Reduce claim denials
  • Reduce the time it takes to perform critical patient clinical procedures

The methods and tools used to secure superior results are fundamentally different from day-to-day improvement methods, and for subtle reasons.

Why Continuous Improvement?

Products and services compete poorly in the market, and as a result, new weaknesses, or ‘chronic wastes’, are created. Such weaknesses are usually traceable to weaknesses in the planning process, and show up in an organization’s daily operational processes. To attain breakthroughs in current levels of performance, it is important to first have management commit to a program of quality improvement such as Six Sigma. A program like Six Sigma can help to identify the problems and discover their causes, and organizations must make the time to carry out a diagnosis of the current processes in order to do so. Once the causes are uncovered, remedies can be applied to remove them.

Continual breakthroughs are needed to meet the changing needs of customers and competitive prices. However, breakthroughs in improvement usually lag behind any breakthroughs in design, as they progress at very different rates. The chief reason is that many upper managers give a higher priority to increasing revenue through other means, rather than focusing resources on attaining breakthroughs by achieving unprecedented levels of performance. This difference in priority is usually reflected in the respective organizational structures.

The two main causes of a breakthrough approach include:

  • Global competition has intensified and has become a permanent.
  • There is a need to create a high rate of breakthrough, year after year.

Customers are becoming increasingly demanding of improved products from their suppliers, and these demands are then transmitted through the entire supplier chain of an organization. The demands may go beyond product breakthrough and extend to improving the system of managing for quality.

Breakthroughs must be directed at all areas that influence an organization’s performance: all business, transactional, and manufacturing processes.

CI should not be left solely to voluntary initiatives; it should be built into the strategic plan and DNA of a system.

Effective CI models require that:

  • Leaders mandate it, project by project, year after year
  • Projects be assigned to teams that must discover root causes of the problems to sustain the gains
  • Teams devise remedial changes to the “guilty” processes to remove or deal with the cause(s)
  • Teams work with functions to install new controls to prevent the return of the causes
  • Teams look for ways to replicate the remedies to increase the effect of the breakthrough
  • All teams must follow a systematic fact-based method.

Regardless of what your organization calls or brands its improvement model, breakthrough results only occur after the completion of both journeys.

It has been more than 50 years since Dr. Juran first published articles on the universal sequence for breakthrough. During that time, Dr. Juran witnessed many models and many organizations trying to simplify, reengineer, and rename this simple breakthrough method – some have worked; some have not. The most recent success is Six Sigma, or Six Sigma DMAIC, which has become the most effective “brand” of continuous improvement since the Motorola Corporation first began using the quality improvement method in the late 1970s. Six Sigma methods and tools employ many of these universal principles, and have been combined with the rigor of statistical and technological tools to collect and analyze data.

To put continuous improvement into action at your organization, contact us today or look into our programs and workshops here.

The post Introduction to Continuous Improvement appeared first on Juran.

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Many of you reading this blog are undoubtedly recognized experts regarding Lean Six Sigma methodologies, tools, and applications.

However, we continue to receive requests both nationally and internationally to explain the origins of these improvement methodologies; their differences and similarities; which to use for success; and the strategic advantages of each.

What is Lean?

Lean is a process improvement methodology used to optimize organizational systems by eliminating or reducing common types of “waste” within them. It does this so organizations perform faster, cheaper and better by improving cycle time and throughput.

Anything that does not offer value is considered waste. Lean methods and tools can provide significant improvements in organizational efficiency. Lean has experienced a continual rebirth in manufacturing-based industries, as well as in service and healthcare-based organizations.

The concept of Lean was developed by Toyota executive, Taiichi Ohno, who first identified the seven types of muda (waste). From there, the Toyota Production System was born, followed by multiple other improvement processes such as World Class Manufacturing (WCM).

Lean therefore, is typically based on the Toyota Production System, and seeks to minimize waste, shorten lead times, and maximize efficiency.

In summary, Lean:

  • Reduces lead time
  • Increases throughput
  • Eliminates waste
  • Provides more value to customers
  • Creates greater profitability
  • Improves delivery time
Lean Methodology – The Roadmap

Lean uses the same DMAIC methodology as Six Sigma, which is an acronym of five phases:

  • Define
  • Measure
  • Analyze
  • Improve
  • Control

The difference with Lean, however, is that you use this step-by-step methodology on an entire process as opposed to a specific chronic problem. The Lean DMAIC roadmap goes as follows:

  • Define Value
    • Define stakeholder value and CTQs
    • Define customer demand
    • Map high-level process
    • Assess for 6S implementation
  • Measure Value
    • Measure customer demand
    • Plan for data collection
    • Validate the measurement system
    • Create a value stream map
    • Determine pace, takt time, and manpower
    • Identify replenishment and capacity constraints
    • Implement S1-S3 of 6S
  • Analyze Process Flow
    • Analyze the value stream map
    • Analyze process and load capacity
    • Perform VA/NVA decomposition analysis
    • Apply Lean problem solving to solve for special causes
  • Improve Process Pull
    • Conduct rapid improvement events
    • Design the process changes and flow
    • Feed, balance, and load the process
    • Standardize work tasks
    • Implement new processes
  • Control the Process
    • Stabilize and refine the value stream
    • Complete process and visual controls
    • Identify mistake-proofing opportunities
    • Implement S4-S6 of 6S
    • Monitor results and close out the project

A Lean expert working with subject matter experts attempts to understand the “value streams” (the end-to-end process tasks that add value to the good or service produced when combined together). They then synchronize processes with customer demand, which enables them to drive out the eight common wastes in processes:

  1. Overproducing
  2. Waiting
  3. Transport
  4. Poor process design
  5. Inventory
  6. Motion
  7. Defects
  8. Underutilized personnel and creativity
The Value Stream
  • Lean Six Sigma projects can begin by selecting a problem to solve or a value stream to improve.
  • A value stream differs from a problem-solving activity. It is more encompassing because it includes all the activities required to bring goods or services from conception to commercialization.
  • A value stream can include detailed design, order taking, scheduling, processing, and delivery or a subset of it.
  • Understanding the value stream allows you to see value-added steps, non-value added steps, and non-value added, but necessary, steps.

The image above displays a very basic value stream map, a tool which shows all steps in a process.

What is Six Sigma?

Six Sigma typically focuses on identifying and meeting the needs of customers first, and the organization or business second. In this way, revenues increase and costs decrease; ultimately improving results.

Six Sigma is about improving what is important or “Critical to the customer (CTQs).” We call this the “Y.” Here, the equation Y = f(x) is used to guide the team and help communicate what a project is trying to accomplish.

Once we understand what the Ys are, we then measure them to see if we are meeting the target. We analyze the Ys to understand the process characteristics that cause variation, and then reduce their variation by controlling the process variables. We call these variables the “Xs.”

There may be many Xs that can impact the Y. If Y is a function of X, then all we need to do is define the Xs with enough precision to control them. Once controlled, the Y should be met. Once this is done we can then hold the gains to maintain performance.

Y = f (x1, x2, x3, x4,…)

Lean Vs Six Sigma

Lean is not a replacement for Six Sigma, and vice versa, because they both take different approaches in the quest for greater effectiveness, efficiency and cost reduction. Essentially, they focus on different problems.

For instance, Lean starts by analyzing workflow and defining value in terms of the benefits the customer gains from the goods or services that are produced. It is conducted in Rapid Improvement or Kaizen events instead of projects.

Alternatively, Six Sigma is focussed on eliminating defects and waste to improve quality and efficiency. This will not only streamline processes, but will also achieve a higher level of customer satisfaction.

Six Sigma and Lean have become two of the most widely recognized and effective methods for creating breakthrough improvement. Both have also evolved from the basis of prior methods, such as Dr. Juran’s Universal Sequence for Breakthrough Quality Improvement, Dr. Shewhart’s and Dr. Deming’s PDCA Cycle and, as mentioned, Toyota’s specialized focus on driving out waste.

Lean and Six Sigma are separate yet complementary methods for improvement. When used independently, Six Sigma allows project teams to improve the effectiveness of processes, while Lean helps improve process efficiency. When used together, the two can both be fit into the DMAIC model to create a new process which is both effective and efficient; driving out waste while increasing value.

What is Lean Six Sigma?

Lean Six Sigma is quite simply the integration of Lean and Six Sigma methodologies. Lean focuses on efficiency, and Six Sigma focuses on how effectiveness can lead to faster results. Together, they are more powerful than either method applied independently of the other. A successful Lean Six Sigma deployment is dependent on a clear understanding of the roles, responsibilities, structures and training requirements of the employee.

Lean Six Sigma can be traced back to 1986, at Motorola in the United States. Ever since World War II Japan was experiencing an economic boom through the implementation of the Kaizen business model, and Japanese products were considered to be of a higher quality than American products as a result. Therefore, Lean Six Sigma was created to compete with the Kaizen business model.

Lean Six Sigma originated from the Juran Trilogy; an approach to planning, controlling, and improving performance in an organization. The Trilogy utilizes projects to focus on achieving breakthroughs in current levels of performance through design or improvement methods. Breakthroughs do not just happen, they require a systematic change process, one that can be achieved with the “project-by-project” approach.

Once a new product, service or process is designed or improved, the outcomes must be controlled to hold the gains. This is done through a quality control process and the root cause corrective action method.

Improving products, processes, and services is a never-ending pursuit. Achieving breakthroughs may require a tenfold improvement, or even better than 3.4 parts per million, which is a Six Sigma level.

For an organization to continue making breakthroughs and meet the needs of their stakeholders, they must master the skills to plan, control, and improve quality. To do this they must use Yellow Belts, Green Belts, Black Belts, and Master Black Belts who follow the Lean Six Sigma methodology.

Benefits of Lean Six Sigma

Lean and Six Sigma – or Lean Six Sigma – provide a comprehensive set of methods and tools that enable organizations to improve quality and reduce costs; all for the ultimate goal of continuous value creation for the customer. Certainly, these are strategic advantages for any company. However, there are five additional benefits that Lean Six Sigma companies enjoy:

Strategic Planning

Strategic planning is driven by an organization’s mission and vision statements, with the mission statement focused on why the organization exists and the vision statement articulating what the organization hopes to achieve. The very best strategic plans translate the vision statement to quantifiable and measurable objectives, such as increasing market share or reducing employee turnover. Lean Six Sigma can accelerate the pace at which those objectives are achieved.

Productivity

As organizations reduce waste and variation from their processes, the noticeable effect is that it increases employee productivity. This happens for several reasons. First, with less waste and less variation, there is less rework. When you get it right the first time, you don’t spend time fixing errors.

Employee Satisfaction

With increased employee productivity comes increased employee motivation, as well as higher employee satisfaction. Employees who don’t have to fight through poorly designed processes, devise workarounds to get things done, or spend time on non-value-adding steps, are more motivated and happier. This isn’t the only employee benefit. As organizations embed Lean Six Sigma into the fabric of their companies, employees naturally become more attuned to identifying waste and variation, as well as seeking opportunities to improve quality and create additional customer value.

Customer Loyalty

Imagine a company that was adept at creating customer value, reducing defects, reducing variation in its products and services, increasing features and benefits, offering a high variety of options at little to no additional cost, and increasing the speed at which the products and services were delivered. That company would certainly enjoy high customer satisfaction, which translates to equally high customer loyalty and retention.

Supply Chain Management

What mature Lean Six Sigma companies usually discover, is that to continuously improve processes, suppliers must eventually become integrated into their quality improvement initiatives. To fully reduce waste and variation in your processes, your suppliers must reduce the waste and variation in their processes, too.

Choosing Methodologies

Whether with the customer-based approach of Six Sigma, or the more speed-focused strategy of Lean, many organizations around the world are succeeding in achieving performance breakthroughs where they had failed before. This is even more-so the case for organizations through the combination of both into the Lean Six Sigma methodology. Smart companies recognize this as not simply a “fix” to one-time problems, but truly a new way of doing business.

Your organization must not debate which to do first, but rather determine how to do both. When you do, you will join the ranks of many globally successful companies. Organizations worldwide are under continuing pressure to control costs, maintain high levels of safety and quality, and meet growing customer expectations. This breakthrough improvement process has been adopted by many large organizations, like Samsung Electronics, General Electric and smaller organizations, like Molex (electronics), A. Schulman (plastics), J. R. Simplot (food processing), and Highmark (insurance) to name a few, as the most effective method for achieving their goals.

How To Think About Lean vs Six Sigma - YouTube

To put these principle into action at your organization, contact us today, email Matthew Muller @mmuller@juran.com or look into our programs and workshops here.

The post Lean, Six Sigma, & Lean Six Sigma: A Definitive Guide appeared first on Juran.

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What is DMAIC? – Superior Project Quality

DMAIC is a process or quality improvement and problem-solving method used to improve business performance. A quality improvement project is a problem defined as a process, customer, or product issue that must be resolved to reduce the cost of poor quality, improve customer experience, or reduce defects.

During the DMAIC process, improvement happens “project by project” and a “project” can be best defined as a “problem scheduled for a solution.” This means management has decided it is important enough to schedule the resources it needs to get the problem solved.

There are many projects carried out in organizations such as:

  • Improving employee and customer satisfaction
  • Decreasing the time from order to shipment received
  • Launching new services

Successful projects follow the following DMAIC methodology:

  • Define
  • Measure
  • Analyze
  • Improve
  • Control

This methodology is usually used as a part of a larger Lean and Six Sigma program.

DMAIC Process & Methodology

The DMAIC process is used to create ‘breakthroughs’ in the organization. Each project is assigned to a leader called a Black or Green Belt and a team of subject matter experts. Once a problem is identified by an organization’s senior management, a project team is selected to resolve it. This team simply follows their project charter through the five steps of the DMAIC methodology, by applying appropriate DMAIC tools during each DMAIC step.

Define

Define is the first phase of the DMAIC methodology. This is when the project team better defines the problem they have been given to by leadership. This is when the team asks questions to both internal and external customers to affirm that the issue really exists. Some DMAIC tools which are used at this point are:

  • Stakeholder analysis
  • Collection of the voice of the customer using the voice of the customer matrix
  • Voice of the customer to critical to quality translation
  • High-level process map (SIPOC diagram)
Measure

Measure is the second phase of the DMAIC methodology. This is when the project team begins the current baseline performance of the problem. During this step, we begin to collect data and interpret the data on current performance. This often leads to a redefining of the problem to focus on the most pressing or ‘vital few issues.’ Some DMAIC tools which are used at this point are:

  • Juran’s Pareto Analysis
  • Data Collection Plan
  • Detailed Process Mapping
  • 6S
  • Value Stream Maps
Analyze

Analyze is the third phase of the DMAIC methodology. This is when the project team collects and uses data to prove theories of root cause, or causes of the problem. These root causes are known as ‘Project Xs’. By the conclusion of this phase, the team will have narrowed down their multiple theories to a vital potential few root causes to test and prove true of false.  Some DMAIC tools which are used at this point are:

  • Calculating Sigma Level
  • Graphs and Charts
  • Brainstorming
  • Stratification
  • Histograms
  • Box Plots
  • Scatter Diagrams
  • Cause-Effect Diagrams
  • 5-Why Analysis
  • Failure Mode and Effect Analysis
  • Impact Control Matrix
Improve

Improve is the fourth phase of the DMAIC methodology. This is when the project team begins the remedial journey and begins acting, on what they have learned by making improvements. At this point the team will:

  • Generate alternative solutions
  • Design the solution (including designs for culture, and designs for control)
  • Prove the effectiveness of the solution
  • Implement the solution

Some DMAIC tools which are used at this point are:

  • Brainstorming
  • Solution Matrix
  • Barriers and Aids Chart
  • Pilot Study
  • Mistake Proofing
  • Benchmarking
  • Pugh Matrix
Control

Control is the fifth and final phase of the DMAIC methodology. This is when the project team ensures that gains made during the Improve phase are held, and the problem does not recur. To ensure this, the team needs to:

  • Identify control subjects
  • Establish a measurement for control
  • Establish standards of performance
  • Measure actual performance
  • Compare actual measured performance to standards
  • Take action on the difference

Some DMAIC tools which are used at this point are:

  • Process Control Plan
  • Control Charts
Using the Steps: DMAIC as a Roadmap

The DMAIC method is a guide to keep the team and project moving forward in an efficient way. WE often refer to the DMAIC steps as the “boss of the project.” Although there is a team leader, the steps are the boss because one must follow the steps to complete the project. Skipping a step could cause the organization to waste money, cause unnecessary culture issues and solutions that do not hold gains.

The DMAIC methodology, whether implemented using just Six Sigma or in conjunction with Lean, is a simple yet very powerful tool for teams to use when making improvements within an organization. When followed, and tools are used appropriately, the DMAIC methodology rarely fails to achieve positive results, and can greatly benefit any organization by:

  1. Assuring that quality thinking becomes the way of doing business, creating a focus on customers and building customer loyalty.
  2. Applying proven quality tools to improve goods and services, and achieve breakthrough performance.
  3. Defining quality process performance metrics that tie to organizational goals.
  4. Creating a quality culture that is fun and provides a pragmatic way to achieve greater levels of process quality.
  5. Identifying projects to drive the improvement that will yield superior quality and sustainable results.

To put this principle into action at your organization, contact us today or look into our programs and workshops here.

The post DMAIC: Attaining Superior Quality & Sustainable Results appeared first on Juran.

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Juran Blog by Dr. Joseph A Defeo - 1M ago
What is the Juran Trilogy?

The Juran Trilogy, also called Quality Trilogy, was presented by Dr. Joseph M. Juran in 1986 as a means to manage for quality. The traditional approach to quality at that time was based on quality control, but today, The Trilogy has become the basis for most quality management best practices around the world.

The Juran Trilogy diagram is often presented as a graph, with time on the horizontal axis and cost of poor quality on the vertical axis. The initial activity is quality planning, or as we refer to it today, ‘quality by design’ – the creation of something new. This could be a new product, service, process, etc.

As operations proceed, it soon becomes evident that  delivery of our products is not 100 percent defect free. Why? Because there are hidden failures or periodic failures (variation) that require rework and redoing. In the diagram, more than 20 percent of the work must be redone due to failures. This waste is considered chronic—it goes on and on until the organization decides to find its root causes and remove it. We call it the Cost of Poor Quality. The design and development process could not account for all unforeseen obstacles in the design process.

Under conventional responsibility patterns, the operating forces are unable to get rid of the defects or waste. What they can do is to carry out control—to prevent things from getting worse, as shown. The figure shows a sudden sporadic spike that has raised the failure level to more than 40 percent. This spike resulted from some unplanned event such as a power failure, process breakdown, or human error. As a part of the control process, the operating forces converge on the scene and take action to restore the status quo. This is often called corrective action, troubleshooting, firefighting, and so on. The end result is to restore the error level back to the planned chronic level of about 20 percent.

The chart also shows that in due course the chronic waste was driven down to a level far below the original level. This gain came from the third process in Juran’s Trilogy—improvement. In effect, it was seen that the chronic waste was an opportunity for improvement, and steps were taken to make that improvement.

In essence, the Juran Trilogy is a universal way of thinking about quality—it fits all functions, all levels, and all product and service lines. The underlying concept is that managing for quality consists of three universal processes:

  • Quality Planning (Quality by Design)
  • Quality Control (Process Control & Regulatory)
  • Quality Improvement (Lean Six Sigma)
Quality Planning (Quality by Design)

The design process enables innovation to happen by designing products (goods, services, or information) together with the processes—including controls—to produce the final outputs. Today many call this Quality By Design or Design for Six Sigma (DFSS)

The Juran Quality by Design model is a structured method used to create innovative design features that respond to customers’ needs and the process features to be used to make those new designs. Quality by Design refers to the product or service development processes in organizations.

Quality Control (Process Control & Regulatory)

Compliance or quality control is the third universal process in the Juran Trilogy.

The term “control of quality” emerged early in the twentieth century. The concept was to broaden the approach to achieving quality, from the then-prevailing after-the-fact inspection (detection control) to what we now call “prevention (proactive control).” For a few decades, the word “control” had a broad meaning, which included the concept of quality planning. Then came events that narrowed the meaning of “quality control.” The “statistical quality control” movement gave the impression that quality control consisted of using statistical methods. The “reliability” movement claimed that quality control applied only to quality at the time of test but not during service life.

Today, the term “quality control” often means quality control and compliance. The goal is to comply with international standards or regulatory authorities such as ISO 9000.

Quality Improvement (Lean Six Sigma)

Improvement happens every day, in every organization—even among the poor performers. That is how businesses survive—in the short term. Improvement is an activity in which every organization carries out tasks to make incremental improvements, day after day. Daily improvement is different from breakthrough improvement. Breakthrough requires special methods and leadership support to attain significant changes and results. It also differs from planning and control. Breakthrough requires taking a “step back” to discover what may be preventing the current level of performance from meeting the needs of its customers. By focusing on attaining breakthrough improvement, leaders can create a system to increase the rate of improvement. By attaining just a few vital breakthroughs year after year (The Pareto Principle), the organization can outperform its competitors and meet stakeholder needs.

As used here, “breakthrough” means “the organized creation of beneficial change and the attainment of unprecedented levels of performance.” Synonyms are “quality improvement” or “Six Sigma improvement.” Unprecedented change may require attaining a Six Sigma level (3.4 ppm) or 10-fold levels of improvement over current levels of process performance. Breakthrough results in significant cost reduction, customer satisfaction enhancement and superior results that will satisfy stakeholders.

The Juran Trilogy has evolved over time in some industries. This evolution has not altered the intent of the trilogy. It only changes the names. For instance, traditional goods producers call it QC, QI and QP while another may say QA/QC, CI and DFSS. The Trilogy continues to be the means to present total quality management to all employees looking to find a way to keep it simple.

To put this principle into action at your organization, contact us today or look into our programs and workshops here.

The post The Juran Trilogy: Quality Planning appeared first on Juran.

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Juran Blog by Dr. Joseph A Defeo - 1M ago

When looking to define Continuous Improvement, one will find that it is used in multiple ways to describe multiple methods. In some instances, it could be used to describe the process of carrying out daily kaizens (Japanese for ‘improvement’); improvement through quality circles; or small, daily incremental improvements. At Juran, we define Continuous Improvement, or CI, as the need to continuously create ‘breakthroughs’.

There are two types of breakthrough, aimed at both sides of the definition of quality:

  1. Achieving higher-quality product and service features to provide customer satisfaction and revenue for the producing organization.
  2. Achieving freedom from failures to reduce customer dissatisfaction and non-value added waste.

Breakthrough is applicable to any industry, problem or process. For the producing organization, reducing product failures – and therefore reducing costs – is a target for breakthrough.

Many organizations create extensive CI programs to reduce excess failures and deficiencies. They may be implemented to drive the following actions:

  • Increase the yield of production processes
  • Reduce error rates of administrative reports
  • Reduce field failures
  • Reduce claim denials
  • Reduce the time it takes to perform critical patient clinical procedures

The methods and tools used to secure superior results are fundamentally different from day-to-day improvement methods, and for subtle reasons.

Why Continuous Improvement?

Products and services compete poorly in the market, and as a result, new weaknesses, or ‘chronic wastes’, are created. Such weaknesses are usually traceable to weaknesses in the planning process, and show up in an organization’s daily operational processes. To attain breakthroughs in current levels of performance, it is important to first have management commit to a program of quality improvement such as Six Sigma. A program like Six Sigma can help to identify the problems and discover their causes, and organizations must make the time to carry out a diagnosis of the current processes in order to do so. Once the causes are uncovered, remedies can be applied to remove them.

Continual breakthroughs are needed to meet the changing needs of customers and competitive prices. However, breakthroughs in improvement usually lag behind any breakthroughs in design, as they progress at very different rates. The chief reason is that many upper managers give a higher priority to increasing revenue through other means, rather than focusing resources on attaining breakthroughs by achieving unprecedented levels of performance. This difference in priority is usually reflected in the respective organizational structures.

The two main causes of a breakthrough approach include:

  • Global competition has intensified and has become a permanent.
  • There is a need to create a high rate of breakthrough, year after year.

Customers are becoming increasingly demanding of improved products from their suppliers, and these demands are then transmitted through the entire supplier chain of an organization. The demands may go beyond product breakthrough and extend to improving the system of managing for quality.

Breakthroughs must be directed at all areas that influence an organization’s performance: all business, transactional, and manufacturing processes.

CI should not be left solely to voluntary initiatives; it should be built into the strategic plan and DNA of a system.

Effective CI models require that:

  • Leaders mandate it, project by project, year after year
  • Projects be assigned to teams that must discover root causes of the problems to sustain the gains
  • Teams devise remedial changes to the “guilty” processes to remove or deal with the cause(s)
  • Teams work with functions to install new controls to prevent the return of the causes
  • Teams look for ways to replicate the remedies to increase the effect of the breakthrough
  • All teams must follow a systematic fact-based method.

Regardless of what your organization calls or brands its improvement model, breakthrough results only occur after the completion of both journeys.

It has been more than 50 years since Dr. Juran first published articles on the universal sequence for breakthrough. During that time, Dr. Juran witnessed many models and many organizations trying to simplify, reengineer, and rename this simple breakthrough method – some have worked; some have not. The most recent success is Six Sigma, or Six Sigma DMAIC, which has become the most effective “brand” of continuous improvement since the Motorola Corporation first began using the quality improvement method in the late 1970s. Six Sigma methods and tools employ many of these universal principles, and have been combined with the rigor of statistical and technological tools to collect and analyze data.

To put continuous improvement into action at your organization, contact us today or look into our programs and workshops here.

The post Introduction to Continuous Improvement appeared first on Juran.

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Pareto diagrams are not hard to construct. With a calculator, graph paper, and a sharp pencil (or even better, a computer with spreadsheet and charting software), an improvement team can easily produce Pareto diagrams to help in decision making.

Getting Ready

As with all the analytical tools, a good Pareto diagram starts with good data. In this case, the data that is needed is any measure of quality, stratified by the various categories that contribute to the overall effect.

The measure of quality can be anything that the team agrees will quantify the negative impact of the issue under consideration. Typical measures include: Cost, time, number of errors or failures, percent of customers expressing an opinion, etc.

The measure (e.g., cost) must be the same for all contributors in the analysis. Pareto analysis is a measured and ranked comparison. You cannot rank by different measures on the same Pareto table or diagram; that would be “comparing apples to oranges.”

Make sure that you spend time identifying all of the potential contributors before you set out to gather the data. Otherwise, you may end up with “miscellaneous” or “unclassified” items. It does not help to focus your team’s efforts if one of the “vital few” is titled “miscellaneous.”

The list of contributors to the effect can come from a variety of sources: Group brainstorming sessions, cause-effect diagrams, process flow diagrams, or the data itself.

Sometimes, the data you need already exists in accounting systems, routine management reports, or the files of individuals in the organization. If, however, the data does not exist, your team should develop a means for gathering it.

No matter how you develop the raw data for your Pareto analysis, to be successful, your data must:

  • Use facts, not opinions, as the basis for decision making.
  • Use the same measure for all contributors, and use the same assumptions and calculations throughout. Keep in mind that Pareto analysis is a comparison technique. Also note that consistency is more important than absolute precision in the numbers. It does not matter so much if assumptions and cost estimates are, say, conservative throughout by ten percent; as long as they stay consistent across all categories, the comparisons will still yield the correct “vital few.”
  • Make sure your data represents the actual conditions and situations in the process.
  • Avoid controversial assumptions or techniques. Keep in mind that you are using Pareto analysis to support decision making. If people do not believe the data, they will not support your team’s decision.
  • Be creative!
Steps to Construct a Pareto Diagram

The following example will display the steps to construct a Pareto Diagram.

A team wanted to reduce the number of billing problems. Customer service reps were asked to record the type of defects (or billing problems) for each customer call during a one-week study period. At the end of the week, the team collected the checksheets and tallied the results by specific cause. To build the Pareto, they followed these steps:

Step 1: Total the data on effect of each contributor, and sum these to determine the grand total.

Defect Type

# Queries

Address Wrong

8

Time Incorrect

20

Rate Factor Incorrect

4

Service Coding Wrong

32

Format Confusing

6

Payment Not Credited

3

73

Step 2: Re-order the contributors from the largest to the smallest.

Defect Type

# Queries

Service Code Wrong

32

Time Incorrect

20

Address Wrong

8

Format Confusing

6

Rate Factor Incorrect

4

Payment Not Credited

3

73

Step 3: Determine the cumulative-percent of total.

For example, the cumulative-percent of total through the fifth contributor is the sum of the effects of the first five in rank ordering, divided by the grand total, and multiplied by 100.

[(32+20+8+6+4)/73]x100=(70/73)x100=96%

The resulting table is called the Pareto Table.

Defect Type

# Queries

Cumulative %

Service Code Wrong

32

44%

Time Incorrect

20

71%

Address Wrong

8

82%

Format Confusing

6

90%

Rate Factor Incorrect

4

96%

Payment Not Credited

3

100%

73

Step 4: Draw and label the left vertical axis.
  • Label the axis from zero to the grand total or just beyond.
  • Provide a caption to describe the measure being used.
Step 5: Draw and label the horizontal axis.
  • Divide the axis into as many divisions as there are contributors.
  • List the contributors from largest to smallest, going from left to right.
  • Provide a caption to describe them.
  • If the contributor names are long, label the axis A, B, C, etc. and provide a separate key.
Step 6: Draw and label the right vertical axis.
  • Label the axis from zero to 100 percent.
  • Line up 100 percent with the grand total on the left axis. In this example, the grand total is 73, so the 50 percent point on the right axis should line up with 36.5 on the left axis.
  • (50/100)x73=36.5
  • Provide the caption: “Cumulative-Percent of Total.”
Step 7: Draw bars to represent the magnitude of each contributor’s effect.

The height of the bars corresponds to the magnitude of that contribution as measured on the left axis.

Step 8: Draw a line graph to represent the cumulative-percent of total.
  • The plotted points correspond to the cumulative-percent as measured on the right axis.
  • Line up the points above the right-hand edge of the bars.
  • The cumulative-percent-of-total point for the first ranked contributor should be even with the height of the first bar. If not, you have made an error.
Step 9: Analyze the diagram.

Look for a breakpoint on the cumulative-percent graph.

Step 10: Title the chart, label the “vital few” and “useful many”, and show the cumulative-percent contribution of the vital few.

Read our guide on the Pareto Principle and Pareto Analysis for more information on these key quality improvement concepts.

To put this principle into action at your organization, contact us today or look into our programs and workshops here.

The post How to Construct a Pareto Diagram appeared first on Juran.

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