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Tools for analysis
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Tools for analysis All intelligent thoughts have already been thought; what is necessary is only to try to think them again. — Johann Wolfgang Goethe
Introduction Define
Measure
Analyse
Improve
Control
Once the project is understood and defined in the ‘Define’ stage, and then the baseline performance has been documented and validated at the ‘Measure’ stage to ascertain that there is a real opportunity, it is now time to perform an in-depth analysis of the process. At this ‘Analysis’ stage, tools and techniques are applied to identify and validate the root causes of problems. The objective is to identify all possible sources of variation in the process and distinguish between special and common causes of variation. Having got to the root causes of the problem, the business cause of the Measure stage can be updated with more accurate data. The data collected in the Measure stage are examined to generate a prioritised list of sources of variation. The key deliverables of the Analysis phase are: 1. A prioritised list of variables: a prioritised list of important sources of variation (particularly special causes) that affect the process output. 2. Quantified financial opportunity: the financial benefit expected from the completion of the project. The important tools for analysis should include: A1: Process Mapping A2: Regression Analysis A3: RU/CS Analysis A4: SWOT Analysis A5: PESTLE Analysis A6: The Five Whys
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A7: Interrelationship Diagram A8: Overall Equipment Effectiveness A9: TRIZ: Innovative Problem Solving During the Analyse stage, some of the tools from the Define and Measure stages are revisited, in particular: M4: Scatter Diagram M5: Cause and Effect Diagram M6: Pareto Chart M7: Control Charts The Analyse stage also depends heavily on advanced techniques including SPC, FMEA and DOE.
A1: Process Mapping Definition Process Mapping is a tool to represent a process by a diagram containing a series of linked tasks or activities which produce an output. It is a further development of a Flow Diagram by using computer software so that the user can link quickly the activities and drill down to gain a more detailed picture.
Application
With the advent of well supported software (e.g. ‘Control’ by Enigma Ltd.), Process Mapping is becoming a way of life for analysing a process or an organisation. A process map does not use symbols like a Flow Process Chart or a Flow Diagram. Only boxes and arrows are used and different colours are often applied to identify types of activities (e.g. non-value added or value added). There are several benefits of applying Process Mapping including the following. Process Mapping means that the team: ● ● ● ● ● ●
●
Can clarify what is happening within an organisation Can simulate what should be happening Can show a process at various levels of detail Can allocate ownership of each activity and promote teamwork Can reflect the end-to-end process and its visibility Can add resources, costs, volumes and duration to build up sophisticated cost models Can identify how the performance of this process can be measured.
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Basic steps
1. 2. 3. 4. 5. 6. 7.
Decide on the organisation, function or process for analysis. Agree higher level functions and their relationships. Agree on input, process and output for each activity. Construct a process diagram for selected functions. Validate the process diagram with stakeholders. Add resources, costs, volumes and duration if required. Apply a ‘what-if ’ analysis and simulation to achieve sustainable process improvement.
Worked-out example
The following example is taken from the demonstration package of the ‘Control’ software (courtesy: Enigma Ltd., Oxford). Consider a case example of dealing with faults in a computer network. A high level process map is shown in Figure 6.1.
Fault reported by engineer
Log service Interruption and open trouble ticket
Diagnose Interruption and enter data on system
£9.75
1.50 h
Call Centre representative
Fault reported
£1.08
by networks
£30
£2.17
10 m
56 m
20 m Field engineer fix
Fault reported by customer
Close fault Report and update system
Network fix
Update customer
Call Centre representative £170
2 hour
Process duration: 3 hours 34 minutes Process cost : £177.28
£6.08
Fault resolve Fault fix rate
84%
2 hour
Call Centre representative
Figure 6.1 Process Mapping (© Ron Basu). Training requirements
Although the basic principles of Process Mapping are simple and logical, it is important that users receive at least 1 day of hands-on training in the chosen software for Process Mapping. It is also useful to gain a good understanding of the ‘what-if ’ simulation processes.
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Final thoughts
Process Mapping has become a very useful computer aided tool for process improvement. However, it should be used for process mapping’s sake. Process maps do not – in isolation – change individual behaviour.
A2: Regression Analysis Definition Regression Analysis is a tool to establish the ‘best fit’ linear relationship between two variables. The knowledge provided by the Scatter Diagram is enhanced with the use of regression. Application
The topic of Regression Analysis is usually studied at school in algebra lessons where different methods of ‘curve fitting’ are considered. Two common methods are: 1. Method of intercept and slope 2. Method of least square. In a practical business environment, the team members normally resort to drawing an approximate straight line by employing their visual judgement. Sometimes they use the ‘method of intercept and slope.’ Both of these practices are the estimated ‘best fit’ relationship between two variables. The reliability of such estimates depends on the degree of correlation that exists between the variables. Regression Analysis is used not only to establish the equation of a line but also to provide the basis for the prediction of a variable for a given value of a process parameter. The Scatter Diagram on the other hand does not predict cause and effect relationships. Given a significant co-relation between the two variables, Regression Analysis is very useful tool enabling one to extend and predict the relationship between these variables. Basic steps
We have considered the ‘method of intercept and slope’ for developing the basic steps as follows (courtesy: Moroney, 1973, p. 284): 1. Consider the equation of y mx c, where m is the slope, c is the intercept and x and y are the two variables. 2. In the equation of y mx c, substitute each of the pairs of values for x and y and then add the resulting equations.
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3. Form a second similar set of equations, by multiplying through each of the equations of Step 2 by its co-efficient of m. Add this set of equations. 4. Steps 2 and 3 will each have produced an equation in m and c. Solve these simultaneous equations for m and c. 5. Plot the straight line graph for y mx c for the calculated values of m and c. Worked-out example
The following example is taken from Moroney (1973), pp. 278–285. Consider an investigation is made into the relationship between two quantities y and x and the following values were observed: y
5
8
9
10
x
1
2
3
4
The values are plotted as shown in Figure 6.2. Now we follow the basic steps to calculate m and c in the equation y mx c. Substituting the observed values of x and y, the resulting equations are: 5 mc 8 2m c 9 3m c 10 4 m c 32 10 m 4c
(6.1)
Multiplying each of the equations by its co-efficient of m, the resulting equations are: 5 mc 16 4 m 2c 27 9m 3c 40 16 m 4c 88 30 m 10c
(6.2)
We then solve simultaneously equations (6.1) and (6.2) for m and c. We find that m 1.6 c4 Hence y 1.6 x 4 We calculate two pairs of values for x and y to draw a straight line as shown in Figure 6.2. y
4
8.8
x
0
3
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10 x x
8 6 x 4 2 0
x 0
1
2
3
4
5
6
7
8
Figure 6.2 Regression Analysis (© Ron Basu).
Training requirements
The training of Regression Analysis is like brushing up on school algebra. A few classroom exercises for approximately 1 hour should be adequate for team members to prepare themselves for the practical application of Regression Analysis.
Final thoughts
Regression Analysis is a powerful tool to extend data from a Scatter Diagram. We recommend the application of Regression Analysis preferably by a team member who has competence and an interest in mathematics.
A3: RU/CS Analysis Definition The RU/CS (Resource Utilisation and Customer Service) Analysis is a simple tool to establish the relative importance of the key parameters of both RU and CS and to identify their conflicts. Wild (2002) suggests the starting point of the RU/CS Analysis with the Operations Objective Chart as shown in Figure 6.3. The relative importance of the key parameters for RU (i.e. Machines, Materials and Labour) and CS (i.e. Specification, Cost and Time) can be given a rating of 1, 2 or 3 (3 being the most important).
Tools for analysis
Resource Utilisation Machines
Materials
Labour
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Customer Service Specification
Cost
Time
Operation
Figure 6.3 Operations Objective Chart. Application
In any business or operation, a manager has to find a balance between two conflicting objectives. CS is of course the primary objective of the operation. For simplicity, three key parameters of CS are considered. These are Specification, Cost (or Price) and Timing. The customer expects the goods or service to be delivered according to acceptable standards, to be of an affordable price and that they arrive on time. However, the relative importance of Specification, Cost and Time could change depending on the market condition, competition and the desirability of demand. The second objective of the Operation Manager is to utilise resources to meet CS requirements. Given infinite resources, any system can provide adequate CS, but many companies have gone out of business in spite of possessing satisfied customers. Therefore, it is essential to provide an efficient use of resources. The RU/CS Analysis aims to point out the way forward to a balanced approach of ‘effective’ CS and ‘efficient’ RU. An organisation in a normal condition will not aim to maximise all three parameters. Likewise, few organisations will aim to maximise the utilisation of all resources. Hence there is some room for adjustment and the Operations Manager must attempt to balance the parameters of these two basic objectives – RU and CS. The RU/CS Analysis is applied to examine the relative importance of the parameters to lead to a balanced solution of objectives.
Basic steps
1. Identify the key parameters of RU. An operation may have several types of resources as input (e.g. machine, facilities, labour, information, etc.). Choose three important resources. 2. For CS parameters, select Specification, Cost and Time. As discussed in Chapter 1, there are other dimensions of quality as perceived by customers; for the sake of simplicity only Specification has been chosen as the key parameter for the quality of service. 3. Draw two matrices for RU and CS showing the six parameters. 4. Allocate a rating of 1, 2 or 3 (3 being most important) to the parameters of both RU and CS. The ratings are influenced by internal processes for RU and external customer requirements for CS. 5. Rate separately what is actually achieved for each aspect of RU and CS. 6. Compare the two sets of figures (from Steps 4 and 5) and identify the shortfalls or misalignments.
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7. Review the criticality of shortfall in CS and examine which resources are inhibiting CS performance. 8. Draw a combined RU/CS matrix, with the allocated ratings outlined in Step 4, and identify their conflicts. It is important to note that the high importance of Specification and Time will require a lower RU. The high importance of cost, on the other hand, will demand a lower price and this will require a higher RU. The tables in Figure 6.4 can be used as a ready reckoner to identify conflicts. 9. Having identified the conflicts, the next step is to examine the relative importance of each parameter in order to minimise conflicts.
RU 1 CS (Specification and Time)
1 2 3
2
3
? ?
X
RU CS Conflict X
(Cost)
1 2 3
1
2
? X
?
3 ?
1 low, 2 medium, 3 high
Figure 6.4 RU/CS conflicts.
Worked-out example
Consider a mail order company where customers are expecting good value for money and do not mind receiving goods from catalogues within a reasonable delivery time. The Operation Manager has focused on the utilisation of own resources to minimise operational costs. Figure 6.5 shows the ratings of objectives, the actual performance and highlights the misalignment. It is evident that further examination is required for Timing and Material. As shown in Figure 6.6, there is a conflict between Cost and Materials and further attention or a change of policy is required to resolve this conflict.
Training requirement
The training workshop for the RU/CS Analysis is likely to be of half a day’s duration and it could be combined with the training for other tools. The understanding of rating and alignment could be simple, but the identification of conflicts is likely to require a few hands-on exercises.
Tools for analysis Machinery/Space Utilisation objectives Actual utilisation Alignment
Customer service objectives Actual level of service Alignment
ⴙ
Good Issues to look at
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People Materials
3 3
3 3
Specification
Cost
Timing
1 2
3 3
2 1
ⴙ
1 2
ⴙ
ⴙ
1 low, 2 medium, 3 high
Figure 6.5 The balance of objectives: mail order company. Machinery/Space 3 High relative importance
3
1
Specifications
Cost
Time
1
3
2
1 Low relative importance Machinery/Space Specifications Cost Time
People Materials
3
People Materials
ⴙ
Conflict
ⴙ
Figure 6.6 RU/CS conflicts in a mail order company. Final thoughts
The RU/CS Analysis is a simple but powerful tool to establish quickly the conflicts between RU and CS and to reflect upon how to go about resolving them. This balance will vary between different operations or organisations.
A4: SWOT Analysis Definition An SWOT (Strengths, Weaknesses, Opportunities and Threats) is a tool for analysing an organisation’s competitive position in relation to its competitors. In the context of a quality improvement programme, an SWOT Analysis refers to a summary of the gaps and positive features of a process following the analytical stage. Application
Based on an SWOT framework, the team members can focus on alternative strategies for improvement. For example, an S/O (Strengths/Opportunities)
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strategy may be considered to consolidate the strengths and open further leverage from the process. Similarly an S/T (Strengths/Threats) strategy may be considered to maximise the strength of the process and minimise risks. Thus an SWOT Analysis can help the team to identify a wide range of alternative strategies for the next stage.
Basic steps
1. Create two categories (internal factors and external factors) and then further sub-divide into positive aspects (Strengths and Opportunities) and negative aspects (Weaknesses and Threats). 2. Ensure that the internal factors may be viewed as a strength or weakness of a process depending on their impact on the outcome or the process output. 3. Similarly assess the external factors bearing in mind that threats to one process could be an opportunity for another process. 4. Summarise the key features and findings derived from previous analyses in each of the SWOT categories. 5. Develop the improvement strategy for the next stage as pointers from the SWOT Analysis.
Worked-out example
The following example is taken from Kotabe and Helsen (2000), p. 277. Table 6.1 shows the framework of an SWOT Analysis.
Table 6.1 The framework of an SWOT Analysers Internal factors
External factors
Strengths
Weaknesses
Brand name, human resources, technology, advertising
Price, lack of financial resources, long product development cycle
Opportunities
Growth market, de-regulation, stable exchange rate, investment grant
S/O strategy Maximise Strengths and maximise Opportunities
W/O strategy Minimise Weaknesses and maximise Opportunities
Threats
New entrants, change in consumer preference, local requirements
S/T strengths Maximise Strengths and minimise Threats
W/T strategy Minimise Weaknesses and minimise Threats
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Training requirements
The training of the SWOT Analysis should be conducted in stages. The first part is in a classroom where the basic principles can be explained based on a known marketing product. The second part of the training is delivered to the team member when the results following the analysis of process are summarised. Final thoughts
Although an SWOT Analysis is primarily a marketing tool, it can be applied effectively in order to summarise the key features of a process after the analytical stage.
A5: PESTLE Analysis Definition The PESTLE (Political, Economic, Social, Technical, Legal and Environmental) Analysis is an analytical tool for assessing the impact of external contexts on a project or a major operation and also the impact of a project on its external contexts. There are several possible contexts including: ● ● ● ● ●
Political Economic Social Technical Environmental.
This is remembered easily by the acronym ‘PESTLE’ or ‘Le Pest’ in French. It is thus also known as the PEST Analysis. Application
Very few major changes, whether they are caused by a major operation or a project, are unaffected by the external surrounds. ●
●
●
●
Political: A project is affected by the policies of international, national or local government. It is also influenced by company policies and those of stakeholders, managers, employees and trade unions. Economic: The project is affected by national and international economic issues, inflation, interest rates and exchange rates. Social: The change is influenced by social issues, the local culture, the lives of employees, communications and language. Technological: The success of implementation is affected by the technology of the industry and the technical capability of the parent company.
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Legal: The project is affected by the legal aspects of planning, registration and working practices. Environmental: The impact of the change on environmental emission, noise, health and safety is assessed.
Basic steps
A PESTLE Analysis is carried out in four stages: 1. Develop a good understanding of the deliverables of the operation and the project. At this stage, the relevant policy and guidelines of both the local company and the parent organisation are reviewed. 2. List the relevant factors affecting the various aspects of the project related to PESTLE. It is important that the appropriate expertise of the organisation is drawn into the team for this analysis. 3. Validate the factors in Step 2 with the stakeholders and functional leaders of the company. 4. Review progress and decide on the next steps by asking two questions: a. How did we do? b. Where do we go next? 5. For more information on the PESTLE Analysis, see Turner et al. (2000, pp. 165–215). Worked-out example
Consider the policy renewal management process of an insurance company based in Finland. The company implemented an on-line renewal process within Finland and wanted to expand the process in the European Union (EU). A PESTLE Analysis was carried out as shown in Table 6.2. The PESTLE Analysis shows that the expansion of on-line service, in general, has direct influence upon and opens up opportunities in the EU. Training requirements
The principles of PESTLE Analysis are best learned by the process of the group working together during the project life cycle. The programme of Black Belt training normally includes a session on PESTLE Analysis and team leaders should receive a broad understanding of this tool. The analysis is of a strategic nature and thus may not involve all members of the project team. Final thoughts
A PESTLE Analysis is most appropriate for the total programme rather than being used for individual operations. We recommend that this tool should be applied to all Six Sigma and Operational Excellence initiatives.
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Table 6.2 PESTLE Analysis Contexts
Key factors
Impact on company (0–10)
Political
• Within EU, countries are moving towards a more common political structure
6
Economic
•
Slowing economy of Finland; GDP forecast to grow by 3.9% in 2003 Dynamic changes in client business environment in Finland and Europe
8
Difference in buying habits in Finland versus EU
7
• Social
•
Technological
•
Accelerating pace of change in ICT in Finland • On-line opportunity in EU with little extra cost • New cyber related risk in client business
9
Legal
•
New constraints or requirements initiated by regulatory bodies (e.g. Insurance Supervisory Authority in EU)
9
Environmental
•
No significant impact
1
A6: The Five Whys Definition The Five Whys is a systematic technique of asking five questions successively. The aim is to probe the causes of a problem and thus hopefully get to the heart of the problem. Application
The Five Whys is a technique that is widely used to analyse problems in both manufacturing and service operations. It is a variation on the classic Work Study approach of ‘critical examination’, involving six questions: Why, What, Where, When Who and How? The objective is to eliminate the root cause rather than patch up the effects. Basic steps
1. 2. 3. 4.
Select the problem for analysis. Ask five ‘close’ questions, one after another, starting with why. Do not defend the answer or point the finger of blame at others. Determine the root cause of the problem.
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Worked-out example
The following example is taken from Stamatis (1999), p. 183. Consider a problem: ‘Deliveries are not completed by 4 p.m.’ Question 1: Why does it happen? Answer: The routing of trucks is not optimised. Question 2: Why is it not optimised? Answer: Goods are loaded based on their size rather than the location of the delivery. Question 3: Why are they loaded by size? Answer: The computer defines the dispatch based upon the principle of ‘large items first’. Question 4: Why are large items given preference? Answer: Large items are delivered first. Question 5: But why? Answer: Current prioritisation policy puts large items first on the delivery schedule. Training requirements
As can be seen from the above question and answer model, the principle of this analytical tool is very straightforward. Thus the application of the Five Whys does not require any rigorous classroom training. The members of a problem solving team can easily understand and apply this simple tool after just one such group exercise. Final thoughts
The Five Whys is an uncomplicated but very effective tool that can be used to identify the root causes of a problem. We recommend that, taking advantage of the fact that it is such a quick and unfussy approach, it can be applied on a far wider basis than at present.
A7: Interrelationship Diagram Definition An Interrelationship Diagram (ID) is an analytical tool to identify, systematically analyse and classify the cause and effect relationships among all critical issue of a process. The key drivers or outcomes are identified leading to an effective solution.
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Application
An ID is often applied to enable the further examination of causes and effects after these are recorded in a Fishbone Diagram. ID encourages team members to think in multiple directions rather than merely in a linear sense. This simple tool enables the team to set priorities to root causes even when credible data does not exist.
Basic steps
1. Assemble the team and agree on the issue or problem for investigation. 2. Lay out all of the ideas or issues that have been brought from other tools (such as a Cause and Effect Diagram) or brainstormed. 3. Look for the cause and effect relationships between all issues and assign the ‘relationship strength’ as: 3 – Significant 2 – Medium 1 – Weak 4. Draw the final ID in a matrix format and insert the ‘relationship strength’ given by members. 5. Total the relationship strength in each row to identify the strongest effect of an issue on the greatest number of issues.
Worked-out example
The following example is taken from Bassard and Ritter (1994), p. 81. Consider five key issues to improve CS. 1. 2. 3. 4. 5.
Logistics Support Customer Satisfaction Education and Training Personal Incentives Leadership
The ID is plotted in a matrix (see Figure 6.7) with appropriate ‘relationship strengths.’ From the above analysis in the ‘Total’ column, it is evident that Customer Satisfaction and Leadership are the two most critical issues.
Training requirements
The team can be adept in the application of ID after less than 1-hour’s training in a classroom or a practical environment. The principles are simple, but it is important that a consensus is reached in attributing the relationship strength numbers.
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Logistics Support
Customer Education Personal Leadership Satisfaction and Incentives Training
Total
Logistics Support
8
Customer Satisfaction
10
Education and Training
9
Personal Incentives
9
Leadership
10
Relationship strength: Key Significant
3
Medium
2
Weak
1
Figure 6.7 Interrelationship Diagram. Final thoughts
ID is not an essential tool to analyse the cause and effect relationship of issues, but because of its simplicity we recommend that it is used selectively to set priorities to causes or issues.
A8: Overall Equipment Effectiveness Definition The Overall Equipment Effectiveness (OEE) is an index of measuring the delivered performance of a plant or equipment based on good output. The method of monitoring OEE is devised in such a way that it would highlight the losses and deficiencies incurred during the operation of the plant and identify the opportunities for improvement. There are many ways to calculate OEE (see Shirose, 1992; Hartman, 1991). In this section we describe the methodology of OEE that was developed and applied by the author in both Unilever1 and GlaxoWellcome.2 1
In Unilever Plc, the methodology was known as PAMCO (Plant and Machine Control). In GlaxoWellcome it was called CAPRO (Capacity Analysis of Production).
2
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Overall OEE is defined by the following formula: OEE%
Actual Good Output 100 Specified Output
where Specified Output Specified Speed Operation Time. Application
The application of OEE has been extensive, especially when driven by the TPM (Total Productive Maintenance) programmes, to critical plant and equipment. It can be applied to a single equipment, a packing line, a production plant or processes. In order to appreciate the usefulness of OEE it is important to understand Equipment Time Analysis as shown in Figure 6.8 and described below.
TOTAL TIME
T
A
O
P
E
Unavail time
AVAILABLE TIME Planned down time
OPERATION TIME
PRODUCTION TIME
EFFECTIVE TIME
Routine stops
Unexpect stops
Figure 6.8 Equipment Time Analysis.
Total Time defines the maximum time within a reporting period, such as 52 weeks a year, 24 hours a day, 8760 hours in a year. Available Time is the time during which the machine or equipment could be operated within the limits of national or local statutes, regulation or convention. Operation Time is the time during which the machine or equipment is planned to run for production purposes. The operational time is normally the shift hours. Production Time is the maximum time during which the machine or equipment could be expected to be operated productively after adjusting the Operation Time for routine stoppages such as changeover and meal breaks. Effective Time is the time needed to produce a ‘good output delivered’ if the machine or equipment is working at its Specified Speed for a defined period. It includes no allowances for interruptions or any other time losses.
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It is important to note that Effective Time is not recorded, it is calculated from the Specified Speed as Effective Time
Good Output Specified Speed
where Specified Speed is the optimum speed of a machine or equipment for a particular product without any allowances for loss of efficiency. It is expressed as quantity per unit such as Tons per hour, Bottles per minute, Cases per hour or Litres per minute. In addition to OEE, two other indices are commonly used as shown below: Effective Time (E) 100 Production Ti me (P) Operation Time (O) Operational Utilisation (%) 100 Total Time (T) Production Efficiency (%)
A properly designed and administered OEE scheme offers a broad range of benefits and a comprehensive manufacturing performance system. Some of its key benefits are: ●
● ●
●
It provides information for shortening lead time and changeover time and a foundation for SMED (single minute exchange of dies). It provides essential and reliable data for capacity planning and scheduling. It identifies the ‘six big losses’ of TPM leading to a sustainable improvement of plant reliability. It provides information for improving asset utilisation and thus reduced capital and depreciation costs in the longer term.
Basic steps
1. Select the machines, equipment or a production line where the OEE scheme could be applied. The selection criteria will depend on the criticality of the equipment in the context of the business. It is useful to start with a single production line as a trial or pilot. 2. Establish the Specified Speed of the production line governed by the control or bottleneck operation. As shown in the following example (Figure 6.9) of a soap packaging line, the Specified Speed is 150 tablets
Cutter
Stamper
Wrapper
Manual
160–200 tablets/minute
160 tablets/minute
150 tablets/minute
Variable
Figure 6.9 Soap production line.
Tools for analysis
3. 4. 5.
6.
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per minute, i.e. this constitutes the speed of the wrapper (which is the slowest piece of equipment). Set up a data recording system so that the output data and various stoppages and losses can be recorded. Compile the data every day and validate the results. At this stage, detailed calculations are not necessary. Monitor the results, comprising OEE and key indices, major losses as a per cent of the Operation Time and the trends of indices. The reporting is normally on a weekly basis for the department and on a monthly basis for Senior Management. Use the results for continuous improvement, planning and strategic changes.
Worked-out example
Consider the production data of a toilet soap packing line where the control station governing the Specified Speed is an ACMA 711 wrapping machine. Week Number: Operation Time: Specified Speed: Good Output: Routine Stoppages: Unexpected Stoppages:
31 128 hours 150 tablets per minute 4232 cases 11 hours 30 minutes 27 hours 15 minutes
Given that each case contains 144 tablets Good Output 4232 144 609 408 tablets Effective Time
Good Output 609 408 67..71 hours Specified Speed 150 60
Production Time Operation Time Routine Stoppages 128 11.5 116.5 hours Total Time 7 24 168 hours OEE
Effective Time 67.71 0.53 53% Production Time 128
Production Efficiency
Operation Utilisation
Effective Time 67.71 58% Production Time 116.5 Operation Time 128 76% Total Time 168
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It is important to note that the Effective Time was calculated and not derived from the recorded stoppages. There will be an amount of unrecorded time (also known as Time Adjustment) as, in the example, given by: Unrecorded Time (Production Time Unexpected Stoppages) Effective Time (116.5 27.25) 67.71 21.54 hours Training requirements
The success of an OEE scheme depends heavily on the rigour of continuous training. It is important that each operator, supervisor and manager of a Production Department receives a half-day training programme covering the definitions, purpose and application of the OEE Scheme. The training is continuous because of the turnover of staff. Senior Management should also benefit from a 1-hour awareness session. Final thoughts
The principles of OEE are conceptually simple but detail rich. The main strength of this tool is that it highlights the areas of deficiency for improvement and the key results cannot be manipulated. The specified time is calculated from tangible ‘good output’, Operation Time is well established shift hours and Total Time is absolute.
A9: TRIZ: Innovative Problem Solving Definition TRIZ is the Russian acronym for Teoriya Resheniya Izobreatatelskikh Zadatch (Inventive or Innovative Problem Solving). It extends traditional systems engineering approaches and provides powerful systematic methods for problem formulation, systems and failure analysis. There are 39 characteristics and 40 principles of Innovative Problem Solving. The contradictions generated by 39 characteristics are systematically eliminated by 40 principles to lead to the development of anew inventions. Application
There are two groups of problems people face: those with generally known solutions and those with unknown solutions. Those with known solutions can usually be solved by information found in books, technical journals or with subject matter experts. The other type of problem is one with no known
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solution. It is called an inventive problem and may contain contradictory requirements. Methods such as brainstorming and trial-and-error are commonly suggested. A better approach was developed by Genrich S. Altshuller (1994), born in the former Soviet Union in 1926 and this approach later known as TRIZ should satisfy the following conditions: 1. 2. 3. 4. 5. 6.
Be a systematic, step-by-step procedure Be a guide through a broad solution space to direct to the ideal solution Be repeatable and reliable and not dependent on psychological tools Be able to access the body of inventive knowledge Be able to add to the body of inventive knowledge Be familiar enough to inventors by following the general approach to problem solving in Figure 6.10. Analogous standard problem
Analogous standard solution
My problem
My solution
Figure 6.10 TRIZ general problem solving model.
Altshuller more clearly defined an inventive problem as one in which the solution causes another problem to appear (such as increasing the strength of a metal plate causing its weight to get heavier) and categorised the solutions into five levels. ●
●
●
●
●
Level one: Routine design problems solved by methods well known within the specialty. No invention needed. About 32% of the solutions fell into this level. Level two: Minor improvements to an existing system, by methods known within the industry. Usually with some compromise. About 45% of the solutions fell into this level. Level three: Fundamental improvement to an existing system, by methods known outside the industry. Contradictions resolved. About 18% of the solutions fell into this category. Level four: A new generation that uses a new principle to perform the primary functions of the system. Solution found more in science than in technology. About 4% of the solutions fell into this category. Level five: A rare scientific discovery or pioneering invention of essentially a new system. About 1% of the solutions fell into this category.
TRIZ has been used in Russia to solve technical problems and develop thousands of patentable inventions. It is now gaining acceptance in major
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companies in Western World and Pacific Rim and also in Six Sigma projects. Samsung and Intel Corporation have recently reported successful application of TRIZ in innovation and projects. Basic steps
There are four basic steps of TRIZ as shown in Figure 6.10. These steps which follow a theme of increasing identity are: Step 1. Identifying my problem – Identify the engineering system being studied, its operating environment, resource requirements, primary useful function, harmful effects and ideal result. Step 2. Formulate the problem the Prism of TRIZ – Restate the problem in terms of physical contradictions and identify problems that could occur. For example, identify if by improving one technical characteristic to solve a problem cause other technical characteristics to worsen, resulting in secondary problems arising Step 3. Search for previously well-solved problem – Find the contradicting engineering characteristics (from 39 TRIZ technical characteristics). First find the characteristic that needs to be changed. Then find the characteristic that is an undesirable secondary effect. State the standard technical conflict. Step 4. Look for analogous solutions and adapt to my solution – Altshuller also extracted from the worldwide patents 40 inventive principles and the Table of Contradictions. These are hints that will help an engineer find a highly inventive (and patentable) solution to the problem. The Table of Contradictions lists the 39 Engineering Parameters on the x-axis (undesired secondary effect) and y-axis (feature to improve). In the intersecting cells, are listed the appropriate Inventive Principles to use for a solution. Worked-out examples
A well known example of TRIZ is the redesign of a metal beverage can. The first step is to identify the problem goal called the Initial Final Result (IFR). The IFRs of our example include the design of a cylindrical metal container to hold the beverage of a given volume that can support the weight of stacking to human height without causing damage to cans or the contents held by the container. The standard technical conflicts are as follows. If we make the containers thinner more stress will be felt by the container walls. On the other hand if we make the walls of the containers thicker, the containers would be heavier and the stacking of heavy containers could damage the bottom layer. Furthermore heavy containers would be more expensive. This conflict of increasing strength and increasing weight could be reconciled by Segmentation, one of the 40 TRIZ principles. The answer is to change the smooth cylindrical surface of the container to a wavy surface made up of many little walls. The new
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design will increase the edge strength of the cylinder while retaining its lighter weight. Training requirements
TRIZ is a highly specialised problem solving tool. Although it is conceptually simple comprising four basic steps it very rich in details. My consulting companies are guarding the 39 technical characteristics and 40 principles along with the apparently complex Contradiction matrix to promote training workshops. The training workshops are usually covered 3–5 days. During the course the participants learn about problem identification and formulation and search for solutions by applying the matrix of 39 characteristics and 40 principles. Final thoughts
TRIZ is conceptually a very powerful problem solving tool leading to new ideas and innovative solutions. The bottom line question is ‘if TRIZ is so so good, why isn’t everyone using it?’ The answer is that because of its prescriptive approach with the baggage of 39 characteristics and 40 principles it is difficult to sell and it also competes with other DFSS tools such as QFD.
Tools for analysis All intelligent thoughts have already been thought; what is necessary is only to try to think them again. — Johann Wolfgang Goethe
Introduction Define
Measure
Analyse
Improve
Control
Once the project is understood and defined in the ‘Define’ stage, and then the baseline performance has been documented and validated at the ‘Measure’ stage to ascertain that there is a real opportunity, it is now time to perform an in-depth analysis of the process. At this ‘Analysis’ stage, tools and techniques are applied to identify and validate the root causes of problems. The objective is to identify all possible sources of variation in the process and distinguish between special and common causes of variation. Having got to the root causes of the problem, the business cause of the Measure stage can be updated with more accurate data. The data collected in the Measure stage are examined to generate a prioritised list of sources of variation. The key deliverables of the Analysis phase are: 1. A prioritised list of variables: a prioritised list of important sources of variation (particularly special causes) that affect the process output. 2. Quantified financial opportunity: the financial benefit expected from the completion of the project. The important tools for analysis should include: A1: Process Mapping A2: Regression Analysis A3: RU/CS Analysis A4: SWOT Analysis A5: PESTLE Analysis A6: The Five Whys
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A7: Interrelationship Diagram A8: Overall Equipment Effectiveness A9: TRIZ: Innovative Problem Solving During the Analyse stage, some of the tools from the Define and Measure stages are revisited, in particular: M4: Scatter Diagram M5: Cause and Effect Diagram M6: Pareto Chart M7: Control Charts The Analyse stage also depends heavily on advanced techniques including SPC, FMEA and DOE.
A1: Process Mapping Definition Process Mapping is a tool to represent a process by a diagram containing a series of linked tasks or activities which produce an output. It is a further development of a Flow Diagram by using computer software so that the user can link quickly the activities and drill down to gain a more detailed picture.
Application
With the advent of well supported software (e.g. ‘Control’ by Enigma Ltd.), Process Mapping is becoming a way of life for analysing a process or an organisation. A process map does not use symbols like a Flow Process Chart or a Flow Diagram. Only boxes and arrows are used and different colours are often applied to identify types of activities (e.g. non-value added or value added). There are several benefits of applying Process Mapping including the following. Process Mapping means that the team: ● ● ● ● ● ●
●
Can clarify what is happening within an organisation Can simulate what should be happening Can show a process at various levels of detail Can allocate ownership of each activity and promote teamwork Can reflect the end-to-end process and its visibility Can add resources, costs, volumes and duration to build up sophisticated cost models Can identify how the performance of this process can be measured.
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Basic steps
1. 2. 3. 4. 5. 6. 7.
Decide on the organisation, function or process for analysis. Agree higher level functions and their relationships. Agree on input, process and output for each activity. Construct a process diagram for selected functions. Validate the process diagram with stakeholders. Add resources, costs, volumes and duration if required. Apply a ‘what-if ’ analysis and simulation to achieve sustainable process improvement.
Worked-out example
The following example is taken from the demonstration package of the ‘Control’ software (courtesy: Enigma Ltd., Oxford). Consider a case example of dealing with faults in a computer network. A high level process map is shown in Figure 6.1.
Fault reported by engineer
Log service Interruption and open trouble ticket
Diagnose Interruption and enter data on system
£9.75
1.50 h
Call Centre representative
Fault reported
£1.08
by networks
£30
£2.17
10 m
56 m
20 m Field engineer fix
Fault reported by customer
Close fault Report and update system
Network fix
Update customer
Call Centre representative £170
2 hour
Process duration: 3 hours 34 minutes Process cost : £177.28
£6.08
Fault resolve Fault fix rate
84%
2 hour
Call Centre representative
Figure 6.1 Process Mapping (© Ron Basu). Training requirements
Although the basic principles of Process Mapping are simple and logical, it is important that users receive at least 1 day of hands-on training in the chosen software for Process Mapping. It is also useful to gain a good understanding of the ‘what-if ’ simulation processes.
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Final thoughts
Process Mapping has become a very useful computer aided tool for process improvement. However, it should be used for process mapping’s sake. Process maps do not – in isolation – change individual behaviour.
A2: Regression Analysis Definition Regression Analysis is a tool to establish the ‘best fit’ linear relationship between two variables. The knowledge provided by the Scatter Diagram is enhanced with the use of regression. Application
The topic of Regression Analysis is usually studied at school in algebra lessons where different methods of ‘curve fitting’ are considered. Two common methods are: 1. Method of intercept and slope 2. Method of least square. In a practical business environment, the team members normally resort to drawing an approximate straight line by employing their visual judgement. Sometimes they use the ‘method of intercept and slope.’ Both of these practices are the estimated ‘best fit’ relationship between two variables. The reliability of such estimates depends on the degree of correlation that exists between the variables. Regression Analysis is used not only to establish the equation of a line but also to provide the basis for the prediction of a variable for a given value of a process parameter. The Scatter Diagram on the other hand does not predict cause and effect relationships. Given a significant co-relation between the two variables, Regression Analysis is very useful tool enabling one to extend and predict the relationship between these variables. Basic steps
We have considered the ‘method of intercept and slope’ for developing the basic steps as follows (courtesy: Moroney, 1973, p. 284): 1. Consider the equation of y mx c, where m is the slope, c is the intercept and x and y are the two variables. 2. In the equation of y mx c, substitute each of the pairs of values for x and y and then add the resulting equations.
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3. Form a second similar set of equations, by multiplying through each of the equations of Step 2 by its co-efficient of m. Add this set of equations. 4. Steps 2 and 3 will each have produced an equation in m and c. Solve these simultaneous equations for m and c. 5. Plot the straight line graph for y mx c for the calculated values of m and c. Worked-out example
The following example is taken from Moroney (1973), pp. 278–285. Consider an investigation is made into the relationship between two quantities y and x and the following values were observed: y
5
8
9
10
x
1
2
3
4
The values are plotted as shown in Figure 6.2. Now we follow the basic steps to calculate m and c in the equation y mx c. Substituting the observed values of x and y, the resulting equations are: 5 mc 8 2m c 9 3m c 10 4 m c 32 10 m 4c
(6.1)
Multiplying each of the equations by its co-efficient of m, the resulting equations are: 5 mc 16 4 m 2c 27 9m 3c 40 16 m 4c 88 30 m 10c
(6.2)
We then solve simultaneously equations (6.1) and (6.2) for m and c. We find that m 1.6 c4 Hence y 1.6 x 4 We calculate two pairs of values for x and y to draw a straight line as shown in Figure 6.2. y
4
8.8
x
0
3
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10 x x
8 6 x 4 2 0
x 0
1
2
3
4
5
6
7
8
Figure 6.2 Regression Analysis (© Ron Basu).
Training requirements
The training of Regression Analysis is like brushing up on school algebra. A few classroom exercises for approximately 1 hour should be adequate for team members to prepare themselves for the practical application of Regression Analysis.
Final thoughts
Regression Analysis is a powerful tool to extend data from a Scatter Diagram. We recommend the application of Regression Analysis preferably by a team member who has competence and an interest in mathematics.
A3: RU/CS Analysis Definition The RU/CS (Resource Utilisation and Customer Service) Analysis is a simple tool to establish the relative importance of the key parameters of both RU and CS and to identify their conflicts. Wild (2002) suggests the starting point of the RU/CS Analysis with the Operations Objective Chart as shown in Figure 6.3. The relative importance of the key parameters for RU (i.e. Machines, Materials and Labour) and CS (i.e. Specification, Cost and Time) can be given a rating of 1, 2 or 3 (3 being the most important).
Tools for analysis
Resource Utilisation Machines
Materials
Labour
95
Customer Service Specification
Cost
Time
Operation
Figure 6.3 Operations Objective Chart. Application
In any business or operation, a manager has to find a balance between two conflicting objectives. CS is of course the primary objective of the operation. For simplicity, three key parameters of CS are considered. These are Specification, Cost (or Price) and Timing. The customer expects the goods or service to be delivered according to acceptable standards, to be of an affordable price and that they arrive on time. However, the relative importance of Specification, Cost and Time could change depending on the market condition, competition and the desirability of demand. The second objective of the Operation Manager is to utilise resources to meet CS requirements. Given infinite resources, any system can provide adequate CS, but many companies have gone out of business in spite of possessing satisfied customers. Therefore, it is essential to provide an efficient use of resources. The RU/CS Analysis aims to point out the way forward to a balanced approach of ‘effective’ CS and ‘efficient’ RU. An organisation in a normal condition will not aim to maximise all three parameters. Likewise, few organisations will aim to maximise the utilisation of all resources. Hence there is some room for adjustment and the Operations Manager must attempt to balance the parameters of these two basic objectives – RU and CS. The RU/CS Analysis is applied to examine the relative importance of the parameters to lead to a balanced solution of objectives.
Basic steps
1. Identify the key parameters of RU. An operation may have several types of resources as input (e.g. machine, facilities, labour, information, etc.). Choose three important resources. 2. For CS parameters, select Specification, Cost and Time. As discussed in Chapter 1, there are other dimensions of quality as perceived by customers; for the sake of simplicity only Specification has been chosen as the key parameter for the quality of service. 3. Draw two matrices for RU and CS showing the six parameters. 4. Allocate a rating of 1, 2 or 3 (3 being most important) to the parameters of both RU and CS. The ratings are influenced by internal processes for RU and external customer requirements for CS. 5. Rate separately what is actually achieved for each aspect of RU and CS. 6. Compare the two sets of figures (from Steps 4 and 5) and identify the shortfalls or misalignments.
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7. Review the criticality of shortfall in CS and examine which resources are inhibiting CS performance. 8. Draw a combined RU/CS matrix, with the allocated ratings outlined in Step 4, and identify their conflicts. It is important to note that the high importance of Specification and Time will require a lower RU. The high importance of cost, on the other hand, will demand a lower price and this will require a higher RU. The tables in Figure 6.4 can be used as a ready reckoner to identify conflicts. 9. Having identified the conflicts, the next step is to examine the relative importance of each parameter in order to minimise conflicts.
RU 1 CS (Specification and Time)
1 2 3
2
3
? ?
X
RU CS Conflict X
(Cost)
1 2 3
1
2
? X
?
3 ?
1 low, 2 medium, 3 high
Figure 6.4 RU/CS conflicts.
Worked-out example
Consider a mail order company where customers are expecting good value for money and do not mind receiving goods from catalogues within a reasonable delivery time. The Operation Manager has focused on the utilisation of own resources to minimise operational costs. Figure 6.5 shows the ratings of objectives, the actual performance and highlights the misalignment. It is evident that further examination is required for Timing and Material. As shown in Figure 6.6, there is a conflict between Cost and Materials and further attention or a change of policy is required to resolve this conflict.
Training requirement
The training workshop for the RU/CS Analysis is likely to be of half a day’s duration and it could be combined with the training for other tools. The understanding of rating and alignment could be simple, but the identification of conflicts is likely to require a few hands-on exercises.
Tools for analysis Machinery/Space Utilisation objectives Actual utilisation Alignment
Customer service objectives Actual level of service Alignment
ⴙ
Good Issues to look at
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People Materials
3 3
3 3
Specification
Cost
Timing
1 2
3 3
2 1
ⴙ
1 2
ⴙ
ⴙ
1 low, 2 medium, 3 high
Figure 6.5 The balance of objectives: mail order company. Machinery/Space 3 High relative importance
3
1
Specifications
Cost
Time
1
3
2
1 Low relative importance Machinery/Space Specifications Cost Time
People Materials
3
People Materials
ⴙ
Conflict
ⴙ
Figure 6.6 RU/CS conflicts in a mail order company. Final thoughts
The RU/CS Analysis is a simple but powerful tool to establish quickly the conflicts between RU and CS and to reflect upon how to go about resolving them. This balance will vary between different operations or organisations.
A4: SWOT Analysis Definition An SWOT (Strengths, Weaknesses, Opportunities and Threats) is a tool for analysing an organisation’s competitive position in relation to its competitors. In the context of a quality improvement programme, an SWOT Analysis refers to a summary of the gaps and positive features of a process following the analytical stage. Application
Based on an SWOT framework, the team members can focus on alternative strategies for improvement. For example, an S/O (Strengths/Opportunities)
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strategy may be considered to consolidate the strengths and open further leverage from the process. Similarly an S/T (Strengths/Threats) strategy may be considered to maximise the strength of the process and minimise risks. Thus an SWOT Analysis can help the team to identify a wide range of alternative strategies for the next stage.
Basic steps
1. Create two categories (internal factors and external factors) and then further sub-divide into positive aspects (Strengths and Opportunities) and negative aspects (Weaknesses and Threats). 2. Ensure that the internal factors may be viewed as a strength or weakness of a process depending on their impact on the outcome or the process output. 3. Similarly assess the external factors bearing in mind that threats to one process could be an opportunity for another process. 4. Summarise the key features and findings derived from previous analyses in each of the SWOT categories. 5. Develop the improvement strategy for the next stage as pointers from the SWOT Analysis.
Worked-out example
The following example is taken from Kotabe and Helsen (2000), p. 277. Table 6.1 shows the framework of an SWOT Analysis.
Table 6.1 The framework of an SWOT Analysers Internal factors
External factors
Strengths
Weaknesses
Brand name, human resources, technology, advertising
Price, lack of financial resources, long product development cycle
Opportunities
Growth market, de-regulation, stable exchange rate, investment grant
S/O strategy Maximise Strengths and maximise Opportunities
W/O strategy Minimise Weaknesses and maximise Opportunities
Threats
New entrants, change in consumer preference, local requirements
S/T strengths Maximise Strengths and minimise Threats
W/T strategy Minimise Weaknesses and minimise Threats
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99
Training requirements
The training of the SWOT Analysis should be conducted in stages. The first part is in a classroom where the basic principles can be explained based on a known marketing product. The second part of the training is delivered to the team member when the results following the analysis of process are summarised. Final thoughts
Although an SWOT Analysis is primarily a marketing tool, it can be applied effectively in order to summarise the key features of a process after the analytical stage.
A5: PESTLE Analysis Definition The PESTLE (Political, Economic, Social, Technical, Legal and Environmental) Analysis is an analytical tool for assessing the impact of external contexts on a project or a major operation and also the impact of a project on its external contexts. There are several possible contexts including: ● ● ● ● ●
Political Economic Social Technical Environmental.
This is remembered easily by the acronym ‘PESTLE’ or ‘Le Pest’ in French. It is thus also known as the PEST Analysis. Application
Very few major changes, whether they are caused by a major operation or a project, are unaffected by the external surrounds. ●
●
●
●
Political: A project is affected by the policies of international, national or local government. It is also influenced by company policies and those of stakeholders, managers, employees and trade unions. Economic: The project is affected by national and international economic issues, inflation, interest rates and exchange rates. Social: The change is influenced by social issues, the local culture, the lives of employees, communications and language. Technological: The success of implementation is affected by the technology of the industry and the technical capability of the parent company.
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Legal: The project is affected by the legal aspects of planning, registration and working practices. Environmental: The impact of the change on environmental emission, noise, health and safety is assessed.
Basic steps
A PESTLE Analysis is carried out in four stages: 1. Develop a good understanding of the deliverables of the operation and the project. At this stage, the relevant policy and guidelines of both the local company and the parent organisation are reviewed. 2. List the relevant factors affecting the various aspects of the project related to PESTLE. It is important that the appropriate expertise of the organisation is drawn into the team for this analysis. 3. Validate the factors in Step 2 with the stakeholders and functional leaders of the company. 4. Review progress and decide on the next steps by asking two questions: a. How did we do? b. Where do we go next? 5. For more information on the PESTLE Analysis, see Turner et al. (2000, pp. 165–215). Worked-out example
Consider the policy renewal management process of an insurance company based in Finland. The company implemented an on-line renewal process within Finland and wanted to expand the process in the European Union (EU). A PESTLE Analysis was carried out as shown in Table 6.2. The PESTLE Analysis shows that the expansion of on-line service, in general, has direct influence upon and opens up opportunities in the EU. Training requirements
The principles of PESTLE Analysis are best learned by the process of the group working together during the project life cycle. The programme of Black Belt training normally includes a session on PESTLE Analysis and team leaders should receive a broad understanding of this tool. The analysis is of a strategic nature and thus may not involve all members of the project team. Final thoughts
A PESTLE Analysis is most appropriate for the total programme rather than being used for individual operations. We recommend that this tool should be applied to all Six Sigma and Operational Excellence initiatives.
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Table 6.2 PESTLE Analysis Contexts
Key factors
Impact on company (0–10)
Political
• Within EU, countries are moving towards a more common political structure
6
Economic
•
Slowing economy of Finland; GDP forecast to grow by 3.9% in 2003 Dynamic changes in client business environment in Finland and Europe
8
Difference in buying habits in Finland versus EU
7
• Social
•
Technological
•
Accelerating pace of change in ICT in Finland • On-line opportunity in EU with little extra cost • New cyber related risk in client business
9
Legal
•
New constraints or requirements initiated by regulatory bodies (e.g. Insurance Supervisory Authority in EU)
9
Environmental
•
No significant impact
1
A6: The Five Whys Definition The Five Whys is a systematic technique of asking five questions successively. The aim is to probe the causes of a problem and thus hopefully get to the heart of the problem. Application
The Five Whys is a technique that is widely used to analyse problems in both manufacturing and service operations. It is a variation on the classic Work Study approach of ‘critical examination’, involving six questions: Why, What, Where, When Who and How? The objective is to eliminate the root cause rather than patch up the effects. Basic steps
1. 2. 3. 4.
Select the problem for analysis. Ask five ‘close’ questions, one after another, starting with why. Do not defend the answer or point the finger of blame at others. Determine the root cause of the problem.
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Worked-out example
The following example is taken from Stamatis (1999), p. 183. Consider a problem: ‘Deliveries are not completed by 4 p.m.’ Question 1: Why does it happen? Answer: The routing of trucks is not optimised. Question 2: Why is it not optimised? Answer: Goods are loaded based on their size rather than the location of the delivery. Question 3: Why are they loaded by size? Answer: The computer defines the dispatch based upon the principle of ‘large items first’. Question 4: Why are large items given preference? Answer: Large items are delivered first. Question 5: But why? Answer: Current prioritisation policy puts large items first on the delivery schedule. Training requirements
As can be seen from the above question and answer model, the principle of this analytical tool is very straightforward. Thus the application of the Five Whys does not require any rigorous classroom training. The members of a problem solving team can easily understand and apply this simple tool after just one such group exercise. Final thoughts
The Five Whys is an uncomplicated but very effective tool that can be used to identify the root causes of a problem. We recommend that, taking advantage of the fact that it is such a quick and unfussy approach, it can be applied on a far wider basis than at present.
A7: Interrelationship Diagram Definition An Interrelationship Diagram (ID) is an analytical tool to identify, systematically analyse and classify the cause and effect relationships among all critical issue of a process. The key drivers or outcomes are identified leading to an effective solution.
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103
Application
An ID is often applied to enable the further examination of causes and effects after these are recorded in a Fishbone Diagram. ID encourages team members to think in multiple directions rather than merely in a linear sense. This simple tool enables the team to set priorities to root causes even when credible data does not exist.
Basic steps
1. Assemble the team and agree on the issue or problem for investigation. 2. Lay out all of the ideas or issues that have been brought from other tools (such as a Cause and Effect Diagram) or brainstormed. 3. Look for the cause and effect relationships between all issues and assign the ‘relationship strength’ as: 3 – Significant 2 – Medium 1 – Weak 4. Draw the final ID in a matrix format and insert the ‘relationship strength’ given by members. 5. Total the relationship strength in each row to identify the strongest effect of an issue on the greatest number of issues.
Worked-out example
The following example is taken from Bassard and Ritter (1994), p. 81. Consider five key issues to improve CS. 1. 2. 3. 4. 5.
Logistics Support Customer Satisfaction Education and Training Personal Incentives Leadership
The ID is plotted in a matrix (see Figure 6.7) with appropriate ‘relationship strengths.’ From the above analysis in the ‘Total’ column, it is evident that Customer Satisfaction and Leadership are the two most critical issues.
Training requirements
The team can be adept in the application of ID after less than 1-hour’s training in a classroom or a practical environment. The principles are simple, but it is important that a consensus is reached in attributing the relationship strength numbers.
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Logistics Support
Customer Education Personal Leadership Satisfaction and Incentives Training
Total
Logistics Support
8
Customer Satisfaction
10
Education and Training
9
Personal Incentives
9
Leadership
10
Relationship strength: Key Significant
3
Medium
2
Weak
1
Figure 6.7 Interrelationship Diagram. Final thoughts
ID is not an essential tool to analyse the cause and effect relationship of issues, but because of its simplicity we recommend that it is used selectively to set priorities to causes or issues.
A8: Overall Equipment Effectiveness Definition The Overall Equipment Effectiveness (OEE) is an index of measuring the delivered performance of a plant or equipment based on good output. The method of monitoring OEE is devised in such a way that it would highlight the losses and deficiencies incurred during the operation of the plant and identify the opportunities for improvement. There are many ways to calculate OEE (see Shirose, 1992; Hartman, 1991). In this section we describe the methodology of OEE that was developed and applied by the author in both Unilever1 and GlaxoWellcome.2 1
In Unilever Plc, the methodology was known as PAMCO (Plant and Machine Control). In GlaxoWellcome it was called CAPRO (Capacity Analysis of Production).
2
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Overall OEE is defined by the following formula: OEE%
Actual Good Output 100 Specified Output
where Specified Output Specified Speed Operation Time. Application
The application of OEE has been extensive, especially when driven by the TPM (Total Productive Maintenance) programmes, to critical plant and equipment. It can be applied to a single equipment, a packing line, a production plant or processes. In order to appreciate the usefulness of OEE it is important to understand Equipment Time Analysis as shown in Figure 6.8 and described below.
TOTAL TIME
T
A
O
P
E
Unavail time
AVAILABLE TIME Planned down time
OPERATION TIME
PRODUCTION TIME
EFFECTIVE TIME
Routine stops
Unexpect stops
Figure 6.8 Equipment Time Analysis.
Total Time defines the maximum time within a reporting period, such as 52 weeks a year, 24 hours a day, 8760 hours in a year. Available Time is the time during which the machine or equipment could be operated within the limits of national or local statutes, regulation or convention. Operation Time is the time during which the machine or equipment is planned to run for production purposes. The operational time is normally the shift hours. Production Time is the maximum time during which the machine or equipment could be expected to be operated productively after adjusting the Operation Time for routine stoppages such as changeover and meal breaks. Effective Time is the time needed to produce a ‘good output delivered’ if the machine or equipment is working at its Specified Speed for a defined period. It includes no allowances for interruptions or any other time losses.
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It is important to note that Effective Time is not recorded, it is calculated from the Specified Speed as Effective Time
Good Output Specified Speed
where Specified Speed is the optimum speed of a machine or equipment for a particular product without any allowances for loss of efficiency. It is expressed as quantity per unit such as Tons per hour, Bottles per minute, Cases per hour or Litres per minute. In addition to OEE, two other indices are commonly used as shown below: Effective Time (E) 100 Production Ti me (P) Operation Time (O) Operational Utilisation (%) 100 Total Time (T) Production Efficiency (%)
A properly designed and administered OEE scheme offers a broad range of benefits and a comprehensive manufacturing performance system. Some of its key benefits are: ●
● ●
●
It provides information for shortening lead time and changeover time and a foundation for SMED (single minute exchange of dies). It provides essential and reliable data for capacity planning and scheduling. It identifies the ‘six big losses’ of TPM leading to a sustainable improvement of plant reliability. It provides information for improving asset utilisation and thus reduced capital and depreciation costs in the longer term.
Basic steps
1. Select the machines, equipment or a production line where the OEE scheme could be applied. The selection criteria will depend on the criticality of the equipment in the context of the business. It is useful to start with a single production line as a trial or pilot. 2. Establish the Specified Speed of the production line governed by the control or bottleneck operation. As shown in the following example (Figure 6.9) of a soap packaging line, the Specified Speed is 150 tablets
Cutter
Stamper
Wrapper
Manual
160–200 tablets/minute
160 tablets/minute
150 tablets/minute
Variable
Figure 6.9 Soap production line.
Tools for analysis
3. 4. 5.
6.
107
per minute, i.e. this constitutes the speed of the wrapper (which is the slowest piece of equipment). Set up a data recording system so that the output data and various stoppages and losses can be recorded. Compile the data every day and validate the results. At this stage, detailed calculations are not necessary. Monitor the results, comprising OEE and key indices, major losses as a per cent of the Operation Time and the trends of indices. The reporting is normally on a weekly basis for the department and on a monthly basis for Senior Management. Use the results for continuous improvement, planning and strategic changes.
Worked-out example
Consider the production data of a toilet soap packing line where the control station governing the Specified Speed is an ACMA 711 wrapping machine. Week Number: Operation Time: Specified Speed: Good Output: Routine Stoppages: Unexpected Stoppages:
31 128 hours 150 tablets per minute 4232 cases 11 hours 30 minutes 27 hours 15 minutes
Given that each case contains 144 tablets Good Output 4232 144 609 408 tablets Effective Time
Good Output 609 408 67..71 hours Specified Speed 150 60
Production Time Operation Time Routine Stoppages 128 11.5 116.5 hours Total Time 7 24 168 hours OEE
Effective Time 67.71 0.53 53% Production Time 128
Production Efficiency
Operation Utilisation
Effective Time 67.71 58% Production Time 116.5 Operation Time 128 76% Total Time 168
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It is important to note that the Effective Time was calculated and not derived from the recorded stoppages. There will be an amount of unrecorded time (also known as Time Adjustment) as, in the example, given by: Unrecorded Time (Production Time Unexpected Stoppages) Effective Time (116.5 27.25) 67.71 21.54 hours Training requirements
The success of an OEE scheme depends heavily on the rigour of continuous training. It is important that each operator, supervisor and manager of a Production Department receives a half-day training programme covering the definitions, purpose and application of the OEE Scheme. The training is continuous because of the turnover of staff. Senior Management should also benefit from a 1-hour awareness session. Final thoughts
The principles of OEE are conceptually simple but detail rich. The main strength of this tool is that it highlights the areas of deficiency for improvement and the key results cannot be manipulated. The specified time is calculated from tangible ‘good output’, Operation Time is well established shift hours and Total Time is absolute.
A9: TRIZ: Innovative Problem Solving Definition TRIZ is the Russian acronym for Teoriya Resheniya Izobreatatelskikh Zadatch (Inventive or Innovative Problem Solving). It extends traditional systems engineering approaches and provides powerful systematic methods for problem formulation, systems and failure analysis. There are 39 characteristics and 40 principles of Innovative Problem Solving. The contradictions generated by 39 characteristics are systematically eliminated by 40 principles to lead to the development of anew inventions. Application
There are two groups of problems people face: those with generally known solutions and those with unknown solutions. Those with known solutions can usually be solved by information found in books, technical journals or with subject matter experts. The other type of problem is one with no known
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solution. It is called an inventive problem and may contain contradictory requirements. Methods such as brainstorming and trial-and-error are commonly suggested. A better approach was developed by Genrich S. Altshuller (1994), born in the former Soviet Union in 1926 and this approach later known as TRIZ should satisfy the following conditions: 1. 2. 3. 4. 5. 6.
Be a systematic, step-by-step procedure Be a guide through a broad solution space to direct to the ideal solution Be repeatable and reliable and not dependent on psychological tools Be able to access the body of inventive knowledge Be able to add to the body of inventive knowledge Be familiar enough to inventors by following the general approach to problem solving in Figure 6.10. Analogous standard problem
Analogous standard solution
My problem
My solution
Figure 6.10 TRIZ general problem solving model.
Altshuller more clearly defined an inventive problem as one in which the solution causes another problem to appear (such as increasing the strength of a metal plate causing its weight to get heavier) and categorised the solutions into five levels. ●
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Level one: Routine design problems solved by methods well known within the specialty. No invention needed. About 32% of the solutions fell into this level. Level two: Minor improvements to an existing system, by methods known within the industry. Usually with some compromise. About 45% of the solutions fell into this level. Level three: Fundamental improvement to an existing system, by methods known outside the industry. Contradictions resolved. About 18% of the solutions fell into this category. Level four: A new generation that uses a new principle to perform the primary functions of the system. Solution found more in science than in technology. About 4% of the solutions fell into this category. Level five: A rare scientific discovery or pioneering invention of essentially a new system. About 1% of the solutions fell into this category.
TRIZ has been used in Russia to solve technical problems and develop thousands of patentable inventions. It is now gaining acceptance in major
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Implementing Six Sigma and Lean
companies in Western World and Pacific Rim and also in Six Sigma projects. Samsung and Intel Corporation have recently reported successful application of TRIZ in innovation and projects. Basic steps
There are four basic steps of TRIZ as shown in Figure 6.10. These steps which follow a theme of increasing identity are: Step 1. Identifying my problem – Identify the engineering system being studied, its operating environment, resource requirements, primary useful function, harmful effects and ideal result. Step 2. Formulate the problem the Prism of TRIZ – Restate the problem in terms of physical contradictions and identify problems that could occur. For example, identify if by improving one technical characteristic to solve a problem cause other technical characteristics to worsen, resulting in secondary problems arising Step 3. Search for previously well-solved problem – Find the contradicting engineering characteristics (from 39 TRIZ technical characteristics). First find the characteristic that needs to be changed. Then find the characteristic that is an undesirable secondary effect. State the standard technical conflict. Step 4. Look for analogous solutions and adapt to my solution – Altshuller also extracted from the worldwide patents 40 inventive principles and the Table of Contradictions. These are hints that will help an engineer find a highly inventive (and patentable) solution to the problem. The Table of Contradictions lists the 39 Engineering Parameters on the x-axis (undesired secondary effect) and y-axis (feature to improve). In the intersecting cells, are listed the appropriate Inventive Principles to use for a solution. Worked-out examples
A well known example of TRIZ is the redesign of a metal beverage can. The first step is to identify the problem goal called the Initial Final Result (IFR). The IFRs of our example include the design of a cylindrical metal container to hold the beverage of a given volume that can support the weight of stacking to human height without causing damage to cans or the contents held by the container. The standard technical conflicts are as follows. If we make the containers thinner more stress will be felt by the container walls. On the other hand if we make the walls of the containers thicker, the containers would be heavier and the stacking of heavy containers could damage the bottom layer. Furthermore heavy containers would be more expensive. This conflict of increasing strength and increasing weight could be reconciled by Segmentation, one of the 40 TRIZ principles. The answer is to change the smooth cylindrical surface of the container to a wavy surface made up of many little walls. The new
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design will increase the edge strength of the cylinder while retaining its lighter weight. Training requirements
TRIZ is a highly specialised problem solving tool. Although it is conceptually simple comprising four basic steps it very rich in details. My consulting companies are guarding the 39 technical characteristics and 40 principles along with the apparently complex Contradiction matrix to promote training workshops. The training workshops are usually covered 3–5 days. During the course the participants learn about problem identification and formulation and search for solutions by applying the matrix of 39 characteristics and 40 principles. Final thoughts
TRIZ is conceptually a very powerful problem solving tool leading to new ideas and innovative solutions. The bottom line question is ‘if TRIZ is so so good, why isn’t everyone using it?’ The answer is that because of its prescriptive approach with the baggage of 39 characteristics and 40 principles it is difficult to sell and it also competes with other DFSS tools such as QFD.