Optimizing Lean and Six SigmaTM to
Achieve World Class Quality
Benchmark Results
Presented by: John A. Lupienski
Motorola Automotive and Industrial
Electronics Group
Elma, NY
GBC August 9, 2001
You will learn the process Motorola
used to achieve these results!!
2000 ~18 Billion
Internal and External
5.7+
Products Manufactured
1986
3.8
John Lupienski
GBC Aug. 9, 2001
What We Will Cover
• Understand the Culture Change needed to breakthrough to
next 6 levels for Quality Improvement
• Learn the 3 Key Focus Areas/Concepts with Lean / 6
– Black Belts roles?
– What Sigma Level are you?
• What are 6 Steps in achieving 6 and 5s of Lean Enterprise
– 6 Hierarchy to breaking through to next levels
– “RSM” (one tool) to help optimize Design for Manufacturability
• How to Keep the Momentum Going
–
–
–
–
Bottom Line Results!!!
Motorola Scorecard- track results
Benchmarking your company
Lessons Learned
• Questions and Answers
John Lupienski
GBC Aug. 9, 2001
We Must First understand
Nature of Culture
• Culture provides its members with
guidelines for dealing with just
about everything.
• Much of every culture is covert and
implicit — largely submerged like an
iceberg.
• Cultures are constantly changing and
evolving.
• When culture and strategy clash,
culture invariably wins out.
• If the organizational culture does not
embrace initiatives related to change,
overall change efforts will fail.
John Lupienski
GBC Aug. 9, 2001
Requirements for Cultural Change
• Top-down commitment and involvement
– Set the example; be active in the process
• Measurement system to track progress
– At both the macro and micro levels
• Common, well-understood set of metrics
– Set tough goals (Reach out!!!)
– Benchmark best in class; audit often
• Spread success stories
– You can’t over-communicate
• Train and education your people
– Tell employees “why” and then show them “how”
then get out of the way
– Be willing to change your Paradigm!!
John Lupienski
GBC Aug. 9, 2001
Change the Old Quality Paradigm


Cost
Defects
Defects

0
0
John Lupienski
GBC Aug. 9, 2001
Set a New Quality Paradigm
The Highest Quality Supplier will be the
Lowest Cost Supplier!

Defects
Defects
0

Cost





0
John Lupienski
GBC Aug. 9, 2001
To achieve LEAN/6 in a company,
you must
have clear insight of three key
concepts:
John Lupienski
GBC Aug. 9, 2001
1.
What is Six SigmaTM?
Answer:
It’s a Problem Solving Methodology that is
Strategically aligned with the Companies
objectives to improve the Bottom line while
satisfying your “Customer” with less than
3.4 ppm Quality level.
Remember:
Both end user who buys it and each next
step in the internal Business Process is a
customer which includes the stakeholders.
John Lupienski
GBC Aug. 9, 2001
2. Who Makes Six Sigma / Lean?
Answer:
People (Mgt) determine what is needed,
establish the priorities/projects, design &
develop the specs./ layouts, buy equipment
& assemble parts, generate the s/w to run
the equipment and ship the products to
your customers.
It is not… robots, computers, machines or a
spectator sport for Management.
John Lupienski
GBC Aug. 9, 2001
3. Why we have Quality Problems ?
Quality problems reflect either changes in
variations or “day one deviations” in the
Business Process. Consistency is key.
Q.P. = 40/30/30 Rule
OR
D/P/S Rule
Answer:
Get the Design, Process, Supplier people together
early in Design process minimizes all problems.
John Lupienski
GBC Aug. 9, 2001
COMPARE A LEAN/6 COMPANY
TO A TRADITIONAL COMPANY
Outstanding LEAN / 6 Company
Typical Traditional Company
 Driven by customer needs
 Prevention of problems before they
happen “ day one problems”
 Nothing less than 100% will do
 Committed to quality at the source
 Cooperative, interdepartmental
teams
 High Employee participation –
empowered work force
 Long-term staying power is a
primary goal
 Driven by company wants
 Detection of problems after the fact
 Established maximum acceptable
levels of error, waste
 Believes inspection is the key to
quality
 Autonomous, independent
departments
 Top-down management-directed
work force
 Short-term profit is a primary goal
John Lupienski
GBC Aug. 9, 2001
Success in LEAN/ 6 Requires Focus
in Three Key Areas of a Company:
 Management
 Technology
 People
John Lupienski
GBC Aug. 9, 2001
Engineering
M
F
G
Administrative
Management Objective in LEAN / 6
To ensure each stage of the “Business Process” is
linked to next “Customer”.
• This includes the Engineering, Finance,
Manufacturing, Administration, and the General
Public.
• It takes a leadership team to oversee and guide
the process & be accountable for its success. It
takes more than one initiative. See Motorola key
initiatives.
John Lupienski
GBC Aug. 9, 2001
1987 - The Motorola Card- distributed by
the CEO Office emphasized key initiative 6 & Lean ( Cycle Time )
OUR FUNDAMENTAL OBJECTIVE
(Everyone's Overriding Responsibility)
Total Customer Satisfaction
KEY BELIEFS -how we will always act
- Constant Respect for People
- Uncompromising Integrity
KEY GOALS - what we must
accomplish
- Best In Class
- People
- Marketing
- Technology
- Product: Software, Hardware and
Systems
- Manufacturing
- Service
- Increased Global Market Share
- Superior Financial Results
KEY INITIATIVES
- Six Sigma Quality
-
Total Cycle Time
Reduction
- Product, Manufacturing and
Environmental
Leadership
- Profit Improvement
- Empowerment for all, in a
Participative, Cooperative and Creative
Workplace
John Lupienski
GBC Aug. 9, 2001
Motorola Established a Quality,
Cycle Time & Cost Benchmark
• 1987 Corporation adopts Six
SigmaTM by 1992 goal
Quality
2 Year 10x = 68% year
Cycle Time 5 Year 10x = 38% year
Cost of Non Conformance < 1 % sales
John Lupienski
GBC Aug. 9, 2001
Motorola established a Quality
Benchmark
Six Sigma Improvement: over 100X
66810 ppm
Defects per Million
Opportunities
100K
3
10K 10X Improvement
4
1K
6210 ppm
30X Improvement
233 ppm
5
100
70X Improvement
10
3.4 ppm
6
1
2
3
4
5
Sigma
6
7
(with +/- sigma shift)
John Lupienski
GBC Aug. 9, 2001
Benchmarking for Quality Costs
Benchmarking as % sales
Defects per Million
Opportunities
100K
> 20%
10K
Average Company
Internal + External
Quality Costs
1K
100
>> 100 X
10
<1%
Best in Class
1
2
3
4
5
6
7
Sigma
John Lupienski
GBC Aug. 9, 2001
Technology Objective in LEAN / 6
To reduce process variability throughout
the entire Business Process to achieve a
perfect product – 100% Yield or defectfree on time with req’d. quantity.
John Lupienski
GBC Aug. 9, 2001
Continuous
Improvement
6
To truly gain a competitive edge, a
company must create a LEAN / 6
culture with continuous improvement
throughout the entire Business Process,
and not just work on technology leaps.
John Lupienski
GBC Aug. 9, 2001
LEAN/ 6
People Objective in LEAN / 6
To develop total employee involvement to
continuously improve the product or
process you are working on. “Education
and Training” are essential.
• Six Sigma Black Belts help to implement
and deploy the process.
John Lupienski
GBC Aug. 9, 2001
Six Sigma Black Belt Deployment
Routine and effective use of Six Sigma tools:
to improve quality and
new technology launches
to reduce cycle time and
costs
John Lupienski
GBC Aug. 9, 2001
A Black Belt will be….
• An “informal leader” from any Technical Discipline
with strong advanced Statistical, Quality and
Interpersonal Skills
• Excellent communicator – Change Agent
• An experienced and proven Problem Solving
Leader in the use of Six Sigma Tools and
Strategies with a continuous learning aptitude
• Coach and Mentor using the continuous
improvement model:
MAIC - measure, analyze,
improve and control
John Lupienski
GBC Aug. 9, 2001
Black Belts: Use MAIC Continuous
Improvement Model “Peel the Onion”
SUPPLIER
•
Process
step 1
RECORD
DEFECTS
•
Process
step 2
RECORD
DEFECTS
•
Process
step 3
RECORD
DEFECTS
•
CUSTOMER
RECORD
DEFECTS
•
RECORD
DEFECTS
TREND CHART
PROCEDURE
GOAL
TIME
MEASURE
CONTROL AND
INSTITUTIONALIZE
ANALYZE
PROBLEM SOLVE
ACTION PLAN
Action
Name
BRAINSTORMING/
PARETO ANALYSIS/
ROOT CAUSE
IDENTIFICATION
& IMPROVE
Date
100%
MOTOROLA’s© CONTINUOUS IMPROVEMENT MODEL
John Lupienski
GBC Aug. 9, 2001
Practical
Solution
Statistical Statistical
Solution Problem
Significant
Problem
The Six SigmaTM Methodology
Prioritize opportunities for
improvement
Select team
Measure
Describe the total process
Assess measurement system
capability
Measuring
system
capable?
Analyze
Improve measurement
system
Confirm significant
characteristics
Determine process capability
Cp, Cpk
meet goal?
Improve
Implement and/or enhance
process control
Is process
stable
Control
Optimize the process
Investigate to remove
assignable causes
Cp, Cpk
meet next
goal?
Continue to monitor
John Lupienski
GBC Aug. 9, 2001
The Six Sigma Black Belt Program
Core Skills
Problem Solving
Quality Tools
Basic Statistics
Interpersonal
Skills
Change Management
Effective
Presentations
Consulting/Teamwork
Business Skills
Project Management
Teaching/Coaching
Skill Development 160 hrs. minimum
Technical Skills
Nonparametric Statistics
Measurement System Analysis
Design & Analysis of Experiments
Robust Design / Tolerancing
Reliability & Availability
Data Analysis Techniques
Survey Design & Analysis
Multivariate Methods
Advanced Regression Modeling
Response Surface Methods
Time Series / Forecasting
Methods
Benchmarking Techniques
John Lupienski
GBC Aug. 9, 2001
Six SigmaTM Black Belt Mentor
Elma, NY. Structure
Belt
Sponsorship
Related Projects
Master Black 5 Black Belts 10 / Year
Black
2 Green Belts 4 / Year
Green
Find 1 new
Green Belt
2 / Year
Institutionalization!!
John Lupienski
GBC Aug. 9, 2001
Black Belt Institutionalized
• Green Belt
– Data Gather and use basic problem solving tools
– 10%-15% of Time spent problem solving
– Min. 2 Projects per Year
• Black Belt
– Lead in the use of adv. statistical & quality tools
– Mentor and Coach Green Belts
– 40%-50% of Time spent problem solving and helping
others. To start they need to be 100% dedicated
– Min. 4 Projects per Year
• Master Black Belt
– Lead in developing and communicating new tools
– Mentors both Green & Black Belts-100% of Time,
including Engineering & Top Management
John Lupienski
GBC Aug. 9, 2001
Do you accept this idea that a Key way to
improve your Profitability is to improve your
Business Process to be Lean / 6 ?
Here are some Benchmark Examples you can
relate with, which are only 3 - 4 process……
John Lupienski
GBC Aug. 9, 2001
Benchmarking Examples of
Business Processes…
IRS - Tax Advice (phone-in)
100K
(66810 ppm)
Restaurant Bills
10K
Average
Company(6210 ppm)
1K
PPM
Doctor Prescription Writing
Payroll Processing
Order Write-up
FINANCIAL CLOSINGS
Wire Transfers
Purchased
Material Lot Air Line Baggage
Handling
(233 ppm)
100
10
Domestic
Airline
Flight Fatality
Rate
Best in Class
(3.4 ppm)
1
2
3
4
SIGMA
5
6
(0.43 ppm)
7
(with ±1.5 Sigma Shift)
What Sigma Level are you?
• When we hire Graduates from
Universities or High Schools into
Industry, they are at best 4 NOT 6
capable.
• Test: Count the # of “f ’s” (both
capital and lower case) in this next
paragraph.
John Lupienski
GBC Aug. 9, 2001
Finished files of financial
information are the result of four
years of scientific study combined
with the experience of research
from fifty professionals from the
University of Frankfurt. These
files will be frozen effective the
first day of February.
John Lupienski
GBC Aug. 9, 2001
All of Us Try to:
• Hire the best people
• Invest sufficient capital
• Provide financial incentives
• Train and Educate our People
Most Often the Result Is:
4 Sigma
Performance
John Lupienski
GBC Aug. 9, 2001
Six Sigma: Ambitious Objective?
Near Perfection 99.99966 % = 6.0 σ, less than 3.4 defects
per million opportunities, sounds excessive!!!
Why isn’t 99.9% already GOOD ENOUGH
in our everyday lives (or 1000 ppm or 4.6σ)?
It would mean:
4000 wrong medical prescriptions each year
More than 3000 newborns accidentally falling
from the hands of nurses or doctors each year
Two long or short landings at Chicago
airport each day
400 letters per hour would never arrive at their destination
Converting Defect Levels to…SIGMA Level !!
An Example :
175 defects are identified while
producing 5000 controllers
D.P.U = 175 / 5000 = 0.035
The manufacture of one controller
allows for 1367 defect opportunities.
DPOp = 0.035 / 1367= 0.0000256
D.P.M.Op = 25.6
"Sigma" level : 5.55
John Lupienski
GBC Aug. 9, 2001
The Six-Steps to achieve 6 Process
Manufactured Product
Administrative/Office
•
•
•
•
•
•
•
Identify physical and functional
requirements of customer
Determine characteristics of
product critical to each
Determine, for each characteristic,
whether controlled by part,
process, or both
Determine maximum range of
each characteristic
Determine process variation for
each characteristic
If Cp <2, redesign materials,
product, and process as required
•
•
•
•
•
Identify the work you do
(your product)
Identify who your work is for
(your customer)
Identify what you need to do your
work, and from whom (your
supplier)
Map the process
Mistake-proof the process and
eliminate delays
Establish quality and cycle time
measurement and improvement
goals
John Lupienski
GBC Aug. 9, 2001
5S and Six Sigma
5S is the foundation of the Lean Enterprise System
Without establishing workplace organization, you cannot build the
structure required to support the Lean Enterprise system and 6.
The 5S’s are:
•
•
•
•
•
Sifting – Identify all items within the work area not required to perform the
transformation process and remove these items.
Sorting – Any “required” item must be assigned a specific location. This
location should be identified by outlining and/or labeling the items location.
Sweeping and Washing – All Grease, Dirt, etc., must be cleaned; set a new
cleanliness level which will provide a safer work area but it also highlights
potential problems (equipment leaks, loose or missing safety guards, etc.)
Spic and Span – The ultimate in workplace organization, the result of
establishing acceptable levels of Sifting, Sorting, and Sweeping and Washing.
Self-Discipline – Individual commitment to the maintenance of 5S
standards.
John Lupienski
GBC Aug. 9, 2001
Lean / 6 Hierarchy = Fruit on a Tree
•
The best fruit can only be
obtained through logical, data
based, design for
manufacturability.
•
The bulk of the fruit can be
“solved” by way of focused
process study. This is the area
where your BB projects should
be focused.
•
•
The low hanging fruit can be
obtained by way of the basic
problem solving tools (paretos,
fishbones, charts, team
interaction, training, etc…).
The ground fruit can be obtained
via the logic and intuition
(watch, observe, interact, etc…)
6
5
4
3
1-2 
• Design for
Manufacturability
• Design for Six Sigma
• Preferred Process
and Supplier Risk
(RPN) Assessments
• Process Optimization
RSM & Contour Plots
• Process (DMAIC)
Characterization
• Process Capabilities
• 7 Basic tools
– Pareto, fishbone,
process mapping,
– Lean Mfg. Layout
(5S)
• Logic and intuition
John Lupienski
GBC Aug. 9, 2001
One Tool to help Optimize and achieve
Robust Product Designs is
RSM
Design
6 tolerance
Collectively
this is the
region of
6 synergy
Process
Characterization
and
Optimization
using “DMAIC”
Material
Capability
short, long
term
John Lupienski
GBC Aug. 9, 2001
RSM
Response Surface Methods
with Contour Plots to optimize
Design For Manufacturability
John Lupienski
GBC Aug. 9, 2001
Pressure
One Factor at a Time Approach
Optimum
Temperature
John Lupienski
GBC Aug. 9, 2001
Pressure
Two Factor at a Time Approach
14 psi
(+1)
12 psi
(0)
10 psi
(-1)
48
54
Path of steepest ascent
42
46
70.0oF77.5oF85.0oF
(-1) (0) (+1)
Temperature
• Each vertex represents a unique test condition
• The maximum response is in the upper right-hand
corner; therefore, the next set of test conditions
(trials) should be along the path of steepest ascent
John Lupienski
GBC Aug. 9, 2001
Three Dimensional Perspective
• The three dimensional perspective plot is
called the
“response
surface”.
• Although it is only a snap shot of the
process, it helps us visualize the
mathematical relationship
0.15
0.10
Response
0.05
0.00
-3
-2
-1
Temperature
0
1
2
-3
3
-2
-1
0
1
2
3
Pressure
John
Lupienski
GBC Aug. 9, 2001
Finding the Maximum Response
Pressure
• The results of one experiment suggests
where the next experiment should be
conducted
• In this manner, we are able to “walk up
the hill”
Temperature
John Lupienski
GBC Aug. 9, 2001
Comparison of Techniques
Pressure
One factor
at a time
approach
Method of
steepest
ascent
Temperature
John Lupienski
GBC Aug. 9, 2001
This becomes basis for 6 Tolerancing
USL
LSL
LSL USL
John Lupienski
GBC Aug. 9, 2001
Eventually you would find the
optimum yield is
91.2%
51.2
80
86
71.5
80
79
78
Time
77
60%
76
75
74
73
72
71
70
127.5
128.5
129.5
130.5
131.5
132.5
Temp
John Lupienski
GBC Aug. 9, 2001
Bottom Line Results
Will
Keep the Momentum Going
John Lupienski
GBC Aug. 9, 2001
1995 - 2001 Elma Customer Returns
(PPM / Six Sigma Trend)
5.11 
180
PPM - Year End
160
140
120
5.37 
100
80
YTD 2001
8 PPM
5.48 
60
5. 63 
40
5. 75
5. 78
5. 81
2000
2001
20
0
1995
1996
1997
1998
1999
2002
John Lupienski
GBC Aug. 9, 2001
Elma, N. Y. Success Story
• Return on SSBB Investment
– “On the average, Black Belt’s can impact the
bottom line from $100K to $500K annually,
at least 2 – 3 times their loaded annual salary”
per John Lupienski
• 1999 - Saved $8 m on 40 SSBB projects
• 2000 - Saved $9 m over 50 projects
• 2001- Budgeting to save over $10 m with
over 80 projects being reviewed
John Lupienski
GBC Aug. 9, 2001
Motorola Finance Made Substantial
Improvements in Monthly Closing
1987 Closing 3
9 Days
1990 Closing 4
 Days
1992 Closing 5
2 Days
1993 - 1998 Some Units Closing 6 1 Day
Present Performance 6+ <24 hours
Motorola’s 1st Reporting earnings
John Lupienski
GBC Aug. 9, 2001
Motorola’s Iridium Satellite Program
made cycle time Improvements:
• Launched 72 satellites in three countries in
less than 13 months
• Cycle time reduction of 13X from first to
15th launch compared to GPS constellation
• Manufacturing cycle time reduction of 6X
versus previous satellite record
• Improvement of 7X in factory floor
utilization
John Lupienski
GBC Aug. 9, 2001
Process Owner Scorecard Example Only
FINAL ASSEMBLY
Product Line
A
B
C
D
E
Up Time (Hr.)
CYCLE TIME Rate (units/Hr.)
Wk1
' 00
WK1June
June ‘01
Scrap ($)
Yield (DPM)
SS Projects
need review
Plan
92
70000
765
185
3099
Actual
50
45412
917
669
2,573
Plan
133
42000
315
962
6637
Actual
101
23908
238
1774
5,048
Plan
112
72000
645
159
8390
Actual
87
12860
148
2197
933
Plan
116
85000
734
327
1348
Actual
107
76942
717
611
1,935
Plan
100
12000
120
320
5871
Actual
116
11790
101
227
3,218
need review
on schedule
review next wk
on schedule
John Lupienski
GBC Aug. 9, 2001
Engineering Scorecard
Example Only
May 2001
Engineering Team
ACTUAL
FIGURE
SCORE
%
>= -5%
X%
4.0
%
>= +2.5%
%
>= +5%
Y%
2.9
Z$
3.5
>= +2.5%
>= +5%
December
>= +1 Month
January
>= +2 Months
5 early
6 delayed
Ave on bud
$203 k
>= -5%
$193 k
>= -10%
SCORING GUIDELINES
GOALS
WEIGHT
4
3
Margin
30%
%
>= +5%
%
>= +2.5%
FORECAST
20%
%
>= -5%
%
>= -2.5%
FORECAST
>= -5%
>= -2.5%
FORECAST
September
>= -2 Months
October
>= -1 Month
$257 k
>= +20%
$235 k
>= +10%
(% Sales)
SCRAP
%
cost
20%
PIP
15%
X%
Y%
1
0
%
>= -2.5%
Z$
(Timing)
PIP
2
15%
(Savings)
November
BUDGET
$214 k
BUDGET
$350.6 K
2.0
4.0
60% better
Weighted Team Score
3.4
Example 2001 Engineering Team Scores
4.00
3.50
3.00
Monthly Score
Performance Rating
2.50
Engineering Staff
:
Personal 50%
Team Score 50%
2.00
1.50
Engineering Team
:
Personal 75%
Team Score 25%
1.00
0.50
0.00
Jan
Feb
Mar
Apr
May
Monthly Score
Jun
Jul
Cummulative Score
Aug
Sep
YTD Score
Oct
Nov
Dec
John Lupienski
GBC Aug. 9, 2001
Hierarchy Of Customer Loyalty
Offensive
Strategy
Gain
Customer
Loyalty
Innovation and
Implementation
Trust
Anticipate
Customer Needs
Exceed
Customer Expectations
Defensive
Strategy
Meet
Customer Requirements
Determine Customer
Requirements and Expectations
Meet
Commitments
Identify Customers
by Organization by Key Contacts
John Lupienski
GBC Aug. 9, 2001
Customer Loyalty is Defined as.....
Would you
repeat/redo
business
again with us?
?
?
YES!
Are you satisfied
today with
current Motorola
Performance?
?
Would you recommend us
for future business to others?
John Lupienski
GBC Aug. 9, 2001
ELMA‘s Customer Loyalty Results
94%
100
80.3%
80
73%
Re-Purchase
Harley Davidson = 94%
Lexus = 73%
All other OEMs 30-40%
60
%
40
Corporate
Benchmark
20
0
”TOP BOX”
VERY SATISFIED
6 or 7
Customer
Loyalty
OVERALL
Satisfied
Quality, Delivery,
Service 4, 5, 6, &7
John Lupienski
GBC Aug. 9, 2001
Benchmarking Tells us...
• There are no secrets to quality.
• There are no “Silver Bullets” or short cuts in achieving
–
Total Customer Loyalty.
• Quality doesn’t take time, it saves time.
• Quality is not free, but it pays Big dividends
• Average companies spends over 25% of its revenue
– On waste & non-value added activities.
• Apply MAIC process to the administrative side of
business as well as manufacturing.
– Institutionalize problem solving process- TFE
• Service companies need continuous improvement
– MAIC model even more than manufacturing.
• Set Tough Reach out!! Goals
–
Benchmark the Best in Class, and audit often
John Lupienski
GBC Aug. 9, 2001
World Class Quality Rating Standard
1
2
3
4
5
Rating Score
A. Quality/Cost/Cycletime Metric 25 Points
1. Customer Quality (PPM)
2. Total Def ects Per Unit (TDPU)
3. Cpk of Key Characteristics
1 to 5
20,000
>8
Unknown
5,000
1.5
<0.5
500
0.5
1.0
50
0.1
2.0
<5
<0.01
>4.0
Unknown
Unknown
Unknown
25%
$50
>20
15%
$25
10
5%
$15
5
<1%
$5
1.5
10%
4th
70:30
5%
3rd
90:30
1%
2nd
95:5
<0.1%
1st
99:1
Unknown
Unknown
<50%
<1
70%
5
80%
10
99%
Lifetime
Unknown
60
1
70
3
80
4
90
5
95
Loss
Negative
<1
30
2
>40%
Unknown
0-2%
0-2%
1
60
4
20%
1
2-5%
4-8%
2
100
10
10%
3
5-10%
15-30%
4-6
300
30
5%
4
>15%
>30%
>8%
>500
>100
2%
5
20%
40%
4. Cost of Poor Quality (COPQ)
% OF SALES
$/ Employee/Day
5. Cycle Tim e
( mul i t p l es o f t heo r et i cal cycl e t i me)
B. Customer Satisfaction Metrics 15 Points
1. Customer Complaints/ Claims - % Total
2. Market Share Position Against Competitors
3. Sales Won/ Sales Loss Ratio
>20 %
>6th
50:50
C. Customer Loyalty Metric 20 Points
1. Customer Loyalty Retained- % of Total
2. Retention Longevity -Years
3. Value Added to Customer- as judged by
customers/ dealers compared to competition 1 to 5
4. Customer Survey - % Satisf action
D. Business Metric 25% Points
1. Prof it-% of Sales af ter Tax
2. Return on Investment
3. Asset Turns
4. Annual Sales/ Employee $ x 000
5. Inventory Turns
6. People Turnover Per Years- %
7. Satisf action of All Stakeholders: Rating 1 to 5
E. Continuous Improvement 15 Points
1. % Improvement Per Year
10%
50%
>60%
OVERALL SCORE
John Lupienski
GBC Aug. 9, 2001
Lessons Learned from Successful Programs
•
Top Down leadership needs to commit & involved
– Set the example, be active in the review process
•
•
Experts (consultants) can accelerate MAIC process
– training, coaching and mentoring
Train your best people to be Masters/ Black Belts
– Know and use your informal leaders
•
Select high impact projects
– Match SSBB people with visible projects
–
•
Prioritize projects using customer concerns first
and cost focused business metrics second
Highlight financial returns
– Need both a Macro & Micro level tracking system
•
Spread success stories 3 ways
–
you can never over communicate !!!
John Lupienski
GBC Aug. 9, 2001
Finally- Lessons Learned –
... Don’t
• Be careful that you don’t get too focused
on winning the metric game.
• Be careful that you don’t lose sight of the
Customer’s priorities.
• Be careful that you don’t become
arrogant and know it all attitude.
• Look at the cost of defects, don’t just look
at the “DPMop” number and drive sigma.
John Lupienski
GBC Aug. 9, 2001
Remember:
“IF…YOU ONLY DO WHAT
YOU’VE ALWAYS DONE….
THEN… YOU ONLY GET
WHAT YOU ALREADY HAVE.”
Thank You
John Lupienski
John Lupienski
GBC Aug. 9, 2001
Questions and Answers
John Lupienski
GBC Aug. 9, 2001
Answer:
25
Finished files of financial information are
the result of four years of scientific study
combined with the experience of research
from fifty professionals from the
University of Frankfurt. These files will
be frozen effective the first day of
February.
John Lupienski
GBC Aug. 9, 2001