Control Strategy that Works

Maintaining the gains from operations improvements is challenging, but not insurmountable.  It all starts at the beginning of your improvement project before you have made any changes.  The following steps are a guide to make your improvements stick!

• Before and After Measurements
  • Pick one key performance metric that resonates with the process personnel.
  • Establish your baseline performance before making improvements or changing anything.
  • Track the performance over time for this one metric with a control chart or a run chart to show the before, during, and after improvement stages for the process.
• Operational Definitions
  • Document what was changed or improved
  • Document the steps taken for the corrective actions that drove the improvement
  • Update or develop work instructions that clearly describe how to do the impacted process activities correctly and consistently.
  • Make sure that the work instructions, or procedures, are U-SMART (Useful, Specific, Measureable, Not Ambiguous, Repeatable, and Terse and to the point).
• Control Plan
  • Name the owner of the process.
  • Identify where and who will measure your key performance metric.
  • Determine the frequency of measurements and updating of the tracking mechanism (control chart or run chart).
  • If something goes wrong name the corrective action takers.
  • Make a list of corrective action steps based upon the corrective actions that have already been implemented to resolve the past performance issues.
  • Keep all measurements, work instructions, process procedures, and corrective action steps visible for all process personnel to have ready access.

You can now run your process and maintain the gains from your improvements.  The Control Strategy that Works starts and ends with the measurement system.  We know where we are before we make changes and then validate the gains after implementation of corrective actions.  Keep on measuring to maintain those gains!

Keys to Successful Operations Improvement

Operations improvement is not magic, but strategically focused hard work. The keys to successful operations improvement include these five elements:

• Performance Metrics tied to business goals and objectives
• Leadership agreement on, and support for, select improvement projects
• Project teams staffed for success
• Project centric training
• Accountability for timely successful project completion

Include these elements sequentially in the operations improvement plan as your strategy for success.

Performance Metrics tied to business goals and objectives

The leadership team reviews the goals and objectives for the business and selects the performance metrics that measure success. Often, Quality Function Deployment (QFD) or a Prioritization Matrix is used to align and rank the performance metrics with the business goals and objectives. The marching orders are now set for the improvement projects.

Leadership agreement on, and support for, select improvement projects

The leadership team reviews the processes across the supply chain from the beginning to the end. Where are the issues? Where do we fall short of expectations? Where is the waste in the system? These questions drive the brainstorming to identify potential improvement projects. A list is made of the projects and incorporated into another QFD or Prioritization Matrix to align and rank the improvement projects with the rated and ranked performance metrics. Using the matrices keeps the prioritization of the projects aligned with the business goals and objectives.

Project teams staffed for success

The leadership team focuses on the top four or five projects based upon the priorities they have agreed on using prioritization matrices. The teams for these projects are selected from the best and the brightest personnel within the organization that have knowledge or skills relevant to the project. Often these individuals are considered too important or too busy to work on improvements. That is the reason for their selections. These personnel decisions answer the question, “Are you serious about making improvements?”

Project centric training

Each project and its assigned team progress through the Lean Six Sigma training and apply the tools and techniques directly on their improvement opportunity. As quickly as methods are learned they are applied to make progress toward the completion of the project following the train and do philosophy. If the opportunity is a process improvement the methodology follows DMAIC (define, measure, analyze, improve, and control). If the opportunity is a design improvement the methodology follows DMADV (define, measure, analyze, design, and validate), or Design for Six Sigma.

Accountability for timely successful project completion

Success requires the leadership team and the improvement project teams be held accountable to complete the projects in a timely manner. Deliverables based project plans focus the effort of the teams to move through the DMAIC, or DMADV, process phases successfully. Phase exit reviews are held between the project and the leadership teams. Phase exit reviews assure that all parties involved are held accountable to achieve successful strategically focused operations improvement.

Six Sigma and the Bottom Line

Many companies have gone down the path of continuous improvement only to be discouraged by the lack of “breakthrough” results. All of the texts on Total Quality harp on the need for strong commitment from senior management for these initiatives to be successful. What is it that motivates these business leaders? The answer is straightforward; Business Leaders are motivated and driven to achieve bottom line results and increase value to shareholders. Six Sigma provides a structured and rigorous approach with a customer focus that drives benefits to the bottom line.

What is Six Sigma?

• A Program that follows a Structured and Rigorous Approach to Process Improvement
  • Production Processes
  • Service Processes
  • Basically, applicable to all Business Processes

• Where Projects are Identified and Prioritized Based upon “Bang for the Buck”
  • Outwardly Customer Focused
  • Bottom Line Impact Potential is the Key Driver
  • Facilitates allocation of a business’s “scarce” resources to the projects with significant business importance
  • Separates the “Vital Few” from the “Trivial Many”

• Where Specific Targets for Improvement are Base lined and Monitored
  • Cost (hard, soft, and cash flow)
  • Cycle Time
  • Non-Value Adding Activities
  • Rework
  • Failures
  • Defects

The Structured and Rigorous Improvement Process is called DMAIC and is comprised of the following five phases.

• Define
  • In this first phase the projects purpose and scope are defined as well as the initial pass at a business case. Process and Customer information is collected to identify how well the process is meeting customer requirements.
• Measure
  • The goals of the Measure phase are to establish baseline process performance, narrow the focus of the project scope and problem statement, and increase the accuracy of the business case. The output from this phase provides the data necessary for the analyze phase.
• Analyze
  • The goals of the Analyze phase are to identify potential root causes of process issues that directly effect critical to quality customer requirements. Theories are tested and validated with data. The output from this phase is verified causes that lead to solution development in the next phase.

• Improve
  • The goals of the Improve phase are to develop and pilot proposed solutions, validate that they address the root causes of the process issues, and achieve or exceed the expected benefits. Once validated, plans are developed for full-scale implementation of solutions.
• Control
  • The goals of the Control phase are to evaluate the new process performance and compare it to the baseline. The business case is updated with the quantified benefits and booked by finance. Standards, documentation, and training in the new process are completed. Process controls are institutionalized to maintain the gains and identify further opportunities for continued improvement.

Teams utilizing the five phases of DMAIC can deliver breakthrough improvements to business processes. This is the road to the Six Sigma stretch goal of 3.4 defects per million opportunities.

How Do Six Sigma Efforts Impact the Bottom Line?

• Income Statement Elements affected:
  • Reduces Cost of Goods Sold
  • Increases Gross Margin
  • Reduces Operating Expenses
  • Increases Net Income
  • Positive Impact on Profitability Ratios
  • Increases Return on Sales
  • Increases Return on Investment

• Balance Sheet Elements affected:
  • After Processes are Improved and Stabilized
  • Inventory Reductions Become Possible
  • Impacts Activity and Efficiency Ratios
  • Increases Asset Turnover
  • Increases Inventory Turnover
  • Decreases Inventory on Hand

Reductions of 10%-30% in both Cost of Goods Sold and Operating Expenses are common, with most companies averaging 20% reductions.

• Consider this example:
  • $200M Sales
  • $100M Cost of Goods Sold
  • $90M Operating Expenses
  • $5M Depreciation and Interest
  • Return on Sales ratio of 2.5%
  • $100M Total Assets
  • Asset Turnover Ratio is 2.0
• Given a conservative reduction of 10% in both COGS and OE from a Six Sigma implementation the Return on Sales increases from 2.5% to 12%.
• Without any balance sheet improvements the Return on Investment Ratio increases from 5% to 24%.
• Inventory is generally addressed after processes have been improved and the need to carry excess inventory to meet customer demand has been reduced.
• A project to reduce the cycle time on the accounts receivable process is often addressed early on in six sigma implementations.

How Do Six Sigma Efforts Do It?

• The key to Six Sigma successes at achieving bottom line improvements is following a Structured and Rigorous Improvement Process that is Customer Focused.

The DMAIC Process comprises the following:

• Define Elements
  • Project Charter and Business Case
  • High Level Process Map called a SI P O C
  • Suppliers to the process
  • Inputs to the process
  • Process steps (5-7 at this level of detail)
  • Outputs from the process steps
  • Customers of the process outputs
  • Voice of the Customer information
  • Needs
  • Drivers
  • CTQs (Critical to Quality Requirements)

• Measure Elements
  • Data Collection Plan
  • Sampling Strategy for Collecting the Data
  • Measurement System Analysis
  • Data Collection
  • Graphically Assessing Patterns in the Data
  • Establishing the Baselines from which to Measure Improvements
  • Business Case Metrics
  • Process Sigma Levels

• Analyze Elements
  • Organize potential root causes using:
  • Affinity Diagrams
  • Cause & Effect Diagrams
  • Process Analysis
  • Analyze Cycle Time
  • Identify Value Added and Non-Value Added activities
  • Data Analysis
  • Identify variation over time
  • Identify relationships between process inputs and outputs
  • Hypothesis Testing (Theory Testing)
  • Does one or more of the potential root causes actually make a difference?
  • Here is where we answer those questions.
  • Regression Analysis of Historical Data
  • Identify the process variables that if controlled, allow us to predict with great certainty the outcome of the process.
  • For example, what is the time (+/- some number of minutes) and the temperature (+/- some number of degrees) that will cook the perfect pizza based upon historical customer feedback of their critical to quality preferences?
  • Design of Experiments
  • Testing that is designed to specifically identify which process variables affect process outputs and is conducted in a controlled fashion.
  • Provides the ability to test many variables where historical data may not have existed, or was not collected in a manner allowing analysis.

• Improve Elements
  • Develop potential solutions using Brainstorming and Advanced Creativity methods.
  • Conduct FMEA (Failure Mode and Effects Analysis) to assess risks and potential failures of the proposed solutions. Try to understand and determine what could go wrong?
  • Rate the severity of a potential failure.
  • Rate the Occurrence of a potential failure.
  • Rate the ability to detect the existence of the failure.
  • Identify the best solutions to minimize failures, or defects.
  • Test the best possible solutions in a pilot implementation.
  • Using the Analyze phase tools answer the question, “Is there a difference with the new method versus the old method?”
  • Select the solutions that actually make a difference.
  • Plan for full-scale implementation.
  • Implement the solutions on a full-scale basis.

• Control Elements
  • Determine and implement process controls.
  • Develop, Document, and Implement Standards.
  • Procedures
  • Policies
  • Operational Definitions
  • Monitor process performance metrics.
  • Evaluate the improvement from the baseline to the current improved state.
  • Determine and quantify the improvement in terms of cost, cost avoidance, revenue enhancement, cycle time, and customer satisfaction.
  • Close the project and celebrate a job well done by the Six Sigma team.

Six Sigma is not just another “Quality” program like TQM, or Quality Circles, but one that has teeth rooted in the financials of the business. Projects are only undertaken if they meet strict business case guidelines set by the senior management team. Not all projects make the cut. Some typical minimum thresholds for a green belt project are $150k cost or expense reduction, $500k cost avoidance, or $1000k cash flow depending on the nature of the business process. The first wave of 5 to 7 projects, completed within 12 to 14 weeks after green belt training, should yield $1 to $2 Million in annualized benefits. That’s bottom line “breakthrough” results.

DMAIC or DMADV, Which Process to Choose?

To choose the proper process for the improvement project requires a brief understanding of each of the acronym based processes of DMAIC and DMADV.  DMAIC is namely Define, Measure, Analyze, Improve, and Control. Its five phases are geared toward breakthrough improvements in products, processes, and service delivery.  DMADV is namely Define, Measure, Analyze, Design, and Validate.  Its five phases are geared toward development of new products, processes, or service delivery.

Choosing which process to follow can be a little confusing at the outset of an improvement project where the names of the first three phases for each of the processes is exactly the same.  To clarify the differences in the first three phases in DMAIC it’s clearly spelled out as Define, Measure, and Analyze with no hidden meanings.  In DMADV the definitions need clarification:

• Define - Development Project Definition


• Measure – Product, Process, or Service Delivery Requirements Definition


• Analyze - Product, Process, or Service Delivery Conceptual Design

If the project’s goal is to develop a new product, process, or service delivery than clearly the process to follow is DMADV, which is a five phased development process.  If the project’s goal is to improve an existing product, process, or service delivery than clearly the process to follow is DMAIC, right?  In most cases it is, but if the existing situation is so broken and just fixing it won’t provide the ability to meet or exceed customer requirements a course correction to DMADV from DMAIC is in order.

Was time wasted by starting off with DMAIC?  The Define and Measure phases in the DMAIC process generate deliverables that will be essential in the development project.  The Analyze phase provides great detail about the failure modes that a new product, process, or service delivery will have to mitigate to be successful.  Time wasn’t wasted, but the conversion from DMAIC to DMADV should take place during the Analyze phase at the latest.  Often after the Measure phase it is clear that a new development is required to meet customer expectations.

From the outset if the project is a new development it is DMADV.  Otherwise, start with DMAIC and course correct if it is determined that redesign is required for the product, process, or service delivery.  Time will not have been wasted unless you don’t course correct.

Measuring Improvement without Data

When faced with a process that cycles infrequently it is often deemed impossible to measure the improvement from the current state to the future state. It doesn’t have to be.

FMEA (failure mode effects analysis) can be used to show before and after improvements based upon the difference in RPN (risk priority number) Score. The question then becomes, “What does an RPN reduction of 500 points actually mean from an improvement standpoint?”

We have developed a table that links the RPN Score to Process Yield which in turn links to Process Sigma. By using the table we can calculate the improvement in Process Sigma from the current state to the future state.

To see how this concept works take our Free Nano Course. Complete topics in 5 minutes or less. (this course is actually about 8 minutes, oops)

To see the Nano Courses available visit EducateVirtually.com

This Nano sized course introduces FMEA, RPN, and converting RPN to Process Sigma Level.

FMEA (Failure Mode and Effects Analysis) is a powerful tool for identifying, defining, and quantifying root causes to operations issues.

The RPN (Risk Priority Number) is calculated by multiplying the severity score times the occurrence score times the detection score.

The RPN quantifies the impact of a potential root cause providing the means to rank the root causes.

This is how we separate the vital few from the trivial many.

Converting the RPN into a Process Sigma Level is shown in a handy table.

When processes cycle infrequently the FMEA, RPN, and conversion to Process Sigma level provide the means to quantify the improvement.

Try a Nano Course, then Register for a Course Today!

More Free Nano Sized Courses

Our Nano courses cover complete topics in 5 minutes or less. These courses are offered for Free!

Take one today, then register for a full sized course that you can take at your leisure, when the time is right for you.

The New Nano Courses

TAKT Time and Process Flow are explained in this Nano course. Our bucket and spigot analogy fully illustrates the concept. Take this course today in less than 5 minutes!

Classifying Customer Wants and Needs Statements using the Kano Model. This Nano course includes an interactive quiz. Take this course in 5 minutes and 50 seconds

Each Nano Course will cover a Continual Improvement Topic, or Software Application, that supports improvement of products, processes, and service delivery.

Try a Nano Course, then Register for a Course Today!

To see the Nano Courses available visit EducateVirtually.com

Lean Six Sigma e-Learning - $299.95 per DMAIC Phase

Our premise is to provide the Lean Six Sigma Training by DMAIC phase concurrently while you work on your Lean Six Sigma Project. The format follows a train and do philosophy.

You will learn the deliverables, be provided with the templates to get them done, and have Master Black Belt support via e-mail for review and coaching.

The Define and Measure Phase Courses are currently available.

As you work on your project we provide the training when the time is right for you to coincide with the progress you are making on your project. When you finish the five DMAIC Phases of the Lean Six Sigma e-Learning, and complete your project you will be eligible for a University Certified Green Belt in Lean Six Sigma.

Taking the course by DMAIC Phase as you work a project is a great way to get certified and your organization benefits from the completed improvement project. It’s budget friendly at only $299.95 per DMAIC phase.

For course information visit EducateVirtually.com

Review our Success Stories Results from Applications of Our Training

For further reading Click here for Reference Books we Recommend

Free Nano Courses – “The How To” in 5 minutes or Less!

We offer free Nano sized courses to give you a taste of some e-learning short subjects.

Each Nano Course will cover a Continual Improvement Topic, or Software Application, that supports improvement of products, processes, and service delivery.

Try a Nano Course, then Register for a Course Today!

To see the Nano Courses available visit EducateVirtually.com

Lean Six Sigma Certification Policies: What are they in your organization?

The problem is no organization or entity has been able to define and establish a universal definition that everyone agrees upon. The ASQ established a testing criteria that has gained some acceptance, but still not universal. Many companies have struggled with what the criteria should be. Many consulting and training firms have defined what they think the criteria should be.




The Management Development Institute (MDI) of Missouri State University has stood by a criterion that was established 8 years ago. It has proven to be very successful with green belts becoming black belts and a few achieving the master black belt status. One of these master black belts was awarded the Missouri Quality Award which is analogous to Malcolm Baldrige, but at the state level.




These certified “belts” have been able to effectively conduct Six Sigma and Lean Six Sigma projects and drive them to successful outcomes that their companies and organizations are extremely happy with. The total savings on certified projects from this program are close to $20 million dollars at this point with projects completed in the United States, Germany, Mexico, and South Africa.

The MDI criterion is as follows:



• Green Belts – complete the Green Belt Lean Six Sigma Training and successfully complete their 1st Project for their organization.


• Black Belts – complete the Black Belt Lean Six Sigma Training and successfully complete a 2nd Project for their organization.


• Master Black Belts – successfully complete their 3rd, 4th, and 5th Projects for their organizations.

Successful completion requires confirmation from the management team of the organization, documented and submitted project report to MDI MSU, and master black belt review by the instructor.




The key to certification is demonstrating the use of the tools and methods by completing projects that benefit your organization. Your reward is certification!




The instructor for MDI is Charlie Carpenter, President, Process Predictability Management Inc, and founder of EducateVirtually.com.




To find out more please visit EducateVirtually.com

Process Predictability Management Inc Receives Endorsement

Process Predictability Management Inc (PPM) has just received an endorsement of the quality and effectiveness of its training and coaching services from DRS Sustainment Systems, Inc. of St. Louis, Missouri.

Naples, Florida (PRWEB) 22, May, 2009 -- “PPM’s dynamic and entertaining teaching methods create a truly effective learning environment. The instructor’s real-life application of the Lean Six Sigma tool kit allows the students to quickly relate the material to their own workplace and responsibilities. With PPM’s support, DRS Sustainment Systems, Inc., now has a sustaining Six Sigma program which has realized in excess of $3 million in savings.”

Companies, organizations, and individuals want to increase their skill sets through continuing education. PPM’s goal has always been to provide businesses, organizations, and individuals with outstanding, relevant, and high quality course selections that are worthwhile investments in continuing education.

Unfortunately, the cost of on site training is becoming prohibitive in today’s economy. Affordable training available on the internet in a self paced format with testing and certification of course completion is the answer for a company, organization, or an individual.
In keeping with a tradition of excellence in training delivery and to offer affordable alternatives to on-site training PPM launched their website EducateVirtually.com in March, 2009. According to a study completed recently by “Economist Intelligence Unit” the future for continuing education will be the adoption of e-learning and distance learning technologies.

The following is a quote from the study: Global education 20/20: What role for the private sector published by the Economist Intelligence Unit Limited March 2009 report sponsored by Cisco. The survey comprised 211 respondents, 123 from private sector companies and 88 from educational institutions.

“When asked about a range of educational delivery mechanisms, 80% of all respondents – and 86% of those representing an educational institution- say technology and innovation, such as e-learning and distance learning, will be important or very important ten years from now”.

EducateVirtually.com has taken proven live classroom courses that successfully transfer knowledge and skills, and developed self-paced e-learning offerings. The e-learning courses challenge the students with interactive exercises, quizzes, and exams. Formal certificates are issued to the students upon course completion.

PPM will continue to provide training and coaching at client’s locations to meet their needs. The Management Development Institute of Missouri State University has been an affiliate for over 7 years and provides certifications for the Lean Six Sigma and Kaizen Facilitator course offerings.

For additional information about the affordable alternatives to on-site continuing education visit http://www.educatevirtually.com/course-offerings

To view the press release on the newswire visit PRWeb

About Process Predictability Management Inc

The mission of (PPM) has been to provide training, coaching, and facilitation services to drive continual improvement across all aspects of any organization’s supply chain.

Review our Success Stories Results from Applications of Our Training

For further reading Click here for Reference Books we Recommend