Quality Management for Organizations Using Lean Six Sigma Techniques

627 Pages·2014·6.01 MB·English

by  Erick Jones

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Manufacturing and Industrial Engineering e
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“… an excellent discussion of Lean Six Sigma techniques … it gives readers an in-depth
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history and process improvement methodology to learn and apply quality initiatives. Q
… very novel in that it compares Six Sigma with and without a Lean manufacturing
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approach; this comparison will allow readers to better understand and select the most Lean Six Sigma
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appropriate implementation method for Lean Six Sigma in their organizations.”
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—Matthew Franchetti, The University of Toledo s
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“… a must have for all industry professionals that want to implement Lean Six Sigma. Techniques
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I will not only have the book on my shelf, but will use it as a reference guide over and M

over … The author was extremely thorough in the topics covered and did not miss L
any tools. The methodology is straightforward and makes Lean Six Sigma an easy a
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fundamental element in one’s profession.” a n
—Tina Kanti Agustiady, Philips Healthcare n a
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“… integrates quality concepts, definitions, philosophies, and methodologies in a S e
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straightforward manner to help the practitioner and student better understand how
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to synthesize the often conflicting tools and techniques in the quality field within the
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Lean Six Sigma body of knowledge. … brings a refreshingly new perspective and
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incorporates many topics that have not been discussed in other textbooks related
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to Six Sigma, such as getting the right talent pool, prioritizing and integrating Six
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Sigma projects with the organization’s strategies, providing financial justification of o
Six Sigma projects, work measurement, and integration to the various quality tools, a r
methods, philosophies, and quality award programs.”
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––Sandra L. Furterer, Southern Polytechnic State University, Marietta, Georgia
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“… an incredibly useful … very easy to read and applicable … The level of detail
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and explanations make it appropriate for anyone wanting to realize the benefits of or
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champion Lean Six Sigma in their own company.”
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—Beth Cudney, Missouri University of Science and Technology q i
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6000 Broken Sound Parkway, NW K14294
Suite 300, Boca Raton, FL 33487 s
Erick C. Jones
711 Third Avenue ISBN: 978-1-4398-9782-9
New York, NY 10017 90000
an informa business
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www.crcpress.com Abingdon, Oxon OX14 4RN, UK
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w w w. c r c p r e s s . c o m
K14294 cvr mech.indd 1 1/24/14 10:08 AM
Quality Management
for Organizations Using
Lean Six Sigma
Techniques

Quality Management
for Organizations Using
Lean Six Sigma
Techniques
Erick C. Jones
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Contents
Preface ........................................................................................................................................xxvii
Acknowledgments ....................................................................................................................xxix
Introduction ...............................................................................................................................xxxi
Author ........................................................................................................................................xxxv
Section I: Modern quality and Lean Six Sigma overview
Chapter 1 Overview of modern quality .................................................................................3
1.1 Introduction .......................................................................................................................3
1.2 What is quality? ................................................................................................................3
1.2.1 How is quality defined? ...................................................................................3
1.2.1.1 Global approach ...............................................................................3
1.2.1.2 Product-based approach .................................................................3
1.2.1.3 User-based approach .......................................................................4
1.2.1.4 Manufacturing-based approach ....................................................4
1.2.1.5 Value-based approach .....................................................................4
1.3 What do organizational departments or functions think about quality? ................6
1.3.1 Functional perspectives on quality................................................................6
1.3.1.1 Engineering perspective on quality ..............................................6
1.3.1.2 Operations perspective on quality ................................................6
1.3.1.3 Systems perspective on quality .....................................................6
1.3.1.4 Executive management perspective on quality...........................7
1.3.1.5 Marketing perspective on quality .................................................8
1.3.1.6 Financial perspective on quality ...................................................8
1.3.1.7 Human resources perspective on quality ..................................10
1.4 Total quality management and quality overview .....................................................10
1.5 Who is taught and trained to attain quality by an organization? ...........................11
1.5.1 The implementation of quality .....................................................................11
1.5.1.1 The integrated approach ...............................................................11
1.5.1.2 Three spheres of quality ...............................................................11
1.6 What if quality is too expensive to justify?.................................................................12
1.6.1 “As-needed” implementation of quality .....................................................12
1.7 Limitation of quality measures ....................................................................................12
1.8 How can the COQ be justified? ....................................................................................13
1.8.1 Cost of quality .................................................................................................13
1.8.2 Traditional COQ .............................................................................................13
© 2010 Taylor & Francis Group, LLC v
vi Contents
1.9 Who started quality and what ideas did they contribute? .......................................14
1.9.1 Quality philosophers, gurus, and contributors .........................................14
1.9.1.1 William E. Deming ........................................................................14
1.9.1.2 Joseph M. Juran ..............................................................................14
1.9.1.3 Philip B. Crosby..............................................................................15
1.9.1.4 Armand V. Feigenbaum ................................................................15
1.9.1.5 Garvin ..............................................................................................15
1.9.1.6 Ishikawa ..........................................................................................15
1.9.1.7 Taguchi ............................................................................................15
1.9.1.8 Japanese contributions to quality ................................................15
1.10 How is quality rewarded and enforced globally? .....................................................16
1.10.1 Quality awards ...............................................................................................16
1.10.1.1 The Deming Prize ..........................................................................16
1.10.1.2 Malcolm Baldrige National Quality Award...............................16
1.10.1.3 European Quality Award .............................................................17
1.11 Quality standards ...........................................................................................................18
1.11.1 ISO 9000 ...........................................................................................................18
1.11.2 ISO 14000 and 14001 .......................................................................................18
1.12 Integrating QM with LSS techniques ..........................................................................19
1.13 Will LSS really work? .....................................................................................................19
1.14 How can I integrate LSS into the operations throughout my supply chain? .........20
References ......................................................................................................................................20
Further Reading ............................................................................................................................21
Chapter 2 Quality gurus and philosophies .........................................................................23
2.1 Introduction .....................................................................................................................23
2.2 William E. Deming .........................................................................................................23
2.3 Joseph M. Juran ...............................................................................................................24
2.4 Philip B. Crosby ..............................................................................................................24
2.5 Armand V. Feigenbaum .................................................................................................24
2.6 Garvin ..............................................................................................................................25
2.7 Ishikawa ...........................................................................................................................25
2.8 Taguchi .............................................................................................................................25
2.9 Japanese contributions to quality .................................................................................25
References ......................................................................................................................................26
Further Readings...........................................................................................................................26
Chapter 3 Quality awards and standards ............................................................................27
3.1 The Deming Prize ...........................................................................................................27
3.1.1 Categories ........................................................................................................28
3.1.2 Deming Prize and TQM ................................................................................28
3.1.3 Deming Prize in detail ..................................................................................29
3.2 The Malcolm Baldrige Award .......................................................................................30
3.2.1 Baldrige model for quality ............................................................................30
3.2.2 Six Sigma method ...........................................................................................31
3.2.3 Baldrige model and Six Sigma ......................................................................31
3.2.3.1 Implementing Six Sigma within the Baldrige model ...............32
3.2.3.2 Full integration ...............................................................................33
© 2010 Taylor & Francis Group, LLC
Contents vii
3.2.4 A quality alliance ...........................................................................................34
3.3 ISO 9000 ...........................................................................................................................34
3.3.1 Purpose ............................................................................................................35
3.3.2 ISO 9000—Performance.................................................................................36
3.4 Other quality awards and standards ...........................................................................36
3.4.1 Strategic quality planning .............................................................................36
3.4.2 European Quality Award ..............................................................................37
3.4.3 Quality Systems ..............................................................................................38
References ......................................................................................................................................38
Further Reading ............................................................................................................................39
Appendix 3A: A relationship between Six Sigma and Malcolm Baldrige
Quality Award .....................................................................................................40
3A.1 Introduction .....................................................................................................................40
3A.2 The Baldrige model for quality .....................................................................................40
3A.3 Six Sigma methodology .................................................................................................41
3A.4 The Baldrige model and Six Sigma ..............................................................................42
3A.4.1 Implementing Six Sigma within the Baldrige model ................................43
3A.5 Integrating Six Sigma with the Baldrige model .........................................................44
3A.5.1 The case for Motorola ....................................................................................45
3A.5.2 Leadership and Six Sigma .............................................................................46
3A.5.3 Human resource management and Six Sigma ...........................................46
3A.5.4 Strategic planning and Six Sigma ................................................................46
3A.6 Conclusion .......................................................................................................................47
References ......................................................................................................................................47
Further Readings...........................................................................................................................48
Appendix 3B: Comparing quality management practices between the United States
and Mexico ............................................................................................................48
3B.1 Introduction .....................................................................................................................48
3B.2 Literature review ............................................................................................................49
3B.3 Theoretical framework: Comparative management ..................................................50
3B.4 Hypotheses ......................................................................................................................51
3B.5 Research methodology ..................................................................................................51
3B.5.1 Survey instrument ..........................................................................................51
3B.5.2 Data collection .................................................................................................53
References ......................................................................................................................................54
Further Readings...........................................................................................................................56
Chapter 4 Six Sigma without Lean ........................................................................................57
4.1 Introduction .....................................................................................................................57
4.1.1 The Six Sigma thinking in this text .............................................................57
4.2 Background .....................................................................................................................58
4.2.1 Which Six Sigma points are retained from TQM? ....................................59
4.2.2 Which Six Sigma point changed from TQM? ............................................59
4.2.3 Six Sigma roots................................................................................................59
4.2.3.1 From product quality program to firm-wide
decision-m aking strategy .............................................................59
4.3 Corporates support Six Sigma popularity ..................................................................60
4.3.1 Industries other than manufacturing ..........................................................60
4.4 Challenges of Six Sigma ................................................................................................61
© 2010 Taylor & Francis Group, LLC
viii Contents
4.5 Six Sigma and engineers ................................................................................................62
4.5.1 Six Sigma and engineering education .........................................................62
4.5.2 Controversy between engineers education and green/black belts .........62
4.6 The statistics of Six Sigma .............................................................................................63
4.7 The 3.4 defects per million or long-term shift confusion ..........................................64
4.8 Methodologies .................................................................................................................65
4.8.1 The Juran Six Sigma approach ......................................................................65
4.8.2 Different methodologies ................................................................................65
4.8.3 Six Sigma statistical tools ..............................................................................66
4.9 Conclusion .......................................................................................................................66
References ......................................................................................................................................66
Further Readings...........................................................................................................................67
Chapter 5 Lean ..........................................................................................................................71
5.1 Introduction .....................................................................................................................71
5.2 Lean enterprise ...............................................................................................................71
5.3 Ohno seven sources of waste ........................................................................................72
5.4 Lean elements of manufacturing .................................................................................72
5.5 Lean tools .........................................................................................................................73
5.6 Value stream mapping ...................................................................................................73
5.7 Lean success ....................................................................................................................74
5.8 Conclusion .......................................................................................................................75
References ......................................................................................................................................75
Further Readings...........................................................................................................................76
Chapter 6 Lean Six Sigma .......................................................................................................79
6.1 Introduction .....................................................................................................................79
6.1.1 History of Lean Six Sigma .............................................................................79
6.1.2 What is the real difference?...........................................................................79
References ......................................................................................................................................81
Further Readings...........................................................................................................................82
Section II: Deciding on firm qualities and Lean Six Sigma initiatives
Chapter 7 The cost approaches and engineering economics of Six Sigma projects ......87
7.1 Introduction .....................................................................................................................87
7.2 Cost approach ..................................................................................................................88
7.3 Value approach ................................................................................................................88
7.4 Application approach .....................................................................................................89
7.5 LSS/Quality decision matrix .........................................................................................91
7.6 Determining economic justification of engineering projects ...................................91
7.7 Previous economic studies ............................................................................................92
7.7.1 Impact of Six Sigma on performance of a company ..................................92
7.8 Critical factors in Six Sigma implementation .............................................................93
7.9 Methodology ...................................................................................................................94
7.9.1 Baseline ............................................................................................................94
7.9.2 Identifying engineering economics metric.................................................94
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Contents ix
7.9.3 Comparison .....................................................................................................94
7.9.4 Evaluation ........................................................................................................96
7.9.5 Sensitivity ........................................................................................................96
7.10 Case study ........................................................................................................................96
7.10.1 Sample calculation..........................................................................................96
7.11 Results and discussions .................................................................................................98
7.11.1 Decision comparison based on EBIT growth rate and IRR ......................98
7.12 Conclusion .......................................................................................................................98
References ......................................................................................................................................98
Chapter 8 Lean Six Sigma and firm performance: A managerial perspective ...........101
8.1 Introduction ...................................................................................................................101
8.2 What is special about Six Sigma? ...............................................................................102
8.3 Process management ....................................................................................................103
8.3.1 Understanding organizational processes .................................................104
8.3.2 Process management and firm performance ...........................................105
8.3.3 Process management and innovation .......................................................106
8.4 Final notes ......................................................................................................................108
References .....................................................................................................................................108
Further Readings.........................................................................................................................110
Chapter 9 Benchmarking high-performing Six Sigma companies ..............................113
9.1 Introduction ...................................................................................................................113
9.1.1 Lean Six Sigma criteria testing model .......................................................113
9.1.1.1 Identification of Six Sigma companies ......................................114
9.2 Lean Six Sigma priority evaluation models ..............................................................117
9.2.1 Estimation of MARR ....................................................................................118
9.2.2 Discount for inflation ...................................................................................118
9.2.3 Calculate performance of each company ..................................................118
9.3 Non-LSS projects in the LSS organization—How do we manage non-LSS
projects? Evaluation and comparison of practices between high- and
low-p erforming companies .........................................................................................119
9.3.1 Study factors critical for Six Sigma implementation ...............................119
9.3.2 Examine and compare failure factors for companies under our study ....122
9.3.3 Difference between traditional and high performance organization ....125
9.4 Lean Six Sigma/no Lean Six Sigma management integration strategy ................128
References ....................................................................................................................................128
Appendix 9A: Developing an instrument for measuring Six Sigma implementation......129
9A.1 Introduction ...................................................................................................................129
9A.2 Background and literature review .............................................................................130
9A.2.1 Six Sigma methodology ...............................................................................130
9A.2.2 Literature review ..........................................................................................130
9A.3 Construct development ................................................................................................131
9A.4 Methodology .................................................................................................................132
9A.5 Analysis ..........................................................................................................................132
9A.5.1 Black belt roles ..............................................................................................132
9A.5.2 DMAIC versus DMADV ..............................................................................133
9A.5.3 Plan .................................................................................................................134
© 2010 Taylor & Francis Group, LLC