CSUN
Engineering
Management
Six Sigma Quality
Engineering
Week 3
Define Phase
Topics
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Six Sigma Project Team
Six Sigma Team Charter
Project Management
Structure of the Define Phase
Define Metrics
Problem Statement Exercise
SIOPC Analysis
Voice of the Customer Analysis
Class Exercise
Six Sigma Project Team

The team must:
• Understand the organizational context for process improvement
projects
• Know the basic elements of the team charter and review any
questions you have about the charter for your own project
• Understand the basics of estimating the business impact of a
project and be able to relate them to your own project
• Be able to identify key players and stakeholders and incorporate
them into the communication plan for your own project
Six Sigma Team Charter

A team charter is an agreement between management and the
team about what is expected.
 The charter:
• A project charter is a form that has key information about your
project. It is used to:
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•
•
•
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Better define your project
Define what is Critical to Quality (CTQ’s) to the Customer
Write a business case (links project to business goals)
Write a problem and goal statement
Scope a project
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State the problem or opportunity
Establish the project goal(s)
Identify criteria for success
List assumptions, risks and obstacles
Communicate the above
Obtain management support
Six Sigma Project Charter Example
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Process
• Process in which opportunity exists
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Project Description
• Project’s purpose and scope
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Project Scope
• Define the part of the process that will be investigated
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Objectives
• Define the baseline, goal & target
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Business Case
• Define the improvement in business performance anticipated and when
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Team Members
• Who are the full time team members
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Expected Customer Benefits
• Who is the final customer?
• What benefit will they see and what are their most critical requirements?
Six Sigma Project Charter Example
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Schedule
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Give the key milestones/dates
Define completion date
Measure completion date
Analyze completion date
Improve completion date
Control completion date
Support required
• Support needed for any special capabilities
Project Management
Problem Statement  Objectives  Measures
Problem Statement
• Should focus the team on a process deficiency
• Communicate the significance to others
 Objectives
• Should address the problem statement
• Quantify performance improvement
 Measures
• Primary Metric(s)
• Used to measure success
• Consistent with problem statement and objectives
• Secondary Metric(s)
• Tracks potential negative consequences
Project Management
Project Problem Statement
 A problem is the unsatisfactory result of a job or process
• So what? What is the impact on the ‘customer’?
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What problem or gap are you addressing?
• What impact will closing the gap have on the customer?
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How will you know things are better?
 It should not include theories about solutions
To help give more focus on the problem, ask the following
questions:
 What are the symptoms? What happens when the problem
appears?
 Where do symptoms appear? Where don’t they appear?
 When do symptoms appear? Where don’t they appear?
 Who is involved? Who isn’t?
Project Management
Project Problem Statements
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A poor problem statement
• Product returns are too high and will be reduced by analyzing
first and second level pareto charts

A better problem statement
• Product returns are 5% of sales resulting in a business unit
negative profit impact of $5M and reduced market share of 10%
Project Management
Project Objectives
 Should address the problem statement
 Quantify performance improvement
 Should also identify timing
 Needs to be Measurable, Actionable and Realistic
• Quality / Quantity / Time / Cost
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A poor objective
• Reduce product returns by implementing performance
measures and objectives
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A better objective
• Reduce product returns of product line abc from 5% to 2.5% by
the year end, to reduce overall returns by 1% and saving $1M
Project Management
Measures
 Should be consistent with the problem statement and
objectives
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Primary Metric(s) - used to measure success
• Needs to include 3 series, plotted as a function of time:
• Baseline performance (average over past 12 months)
• Actual performance
• Objective / target performance
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Secondary Metric(s) - drives the right behaviour
• Tracks potential negative consequences
• More than one may be required
Structure of the Define Phase
Project Name:
DMAIC PROCESS AND PHASE GATE
Define
Met Define Phase Criteria
Estimated
Actual
completion completion
date
date
Status
No
 Define Customers and Requirements (CTQs)
 Develop Problem Statement, Goals and Benefits
 Identify Champion, Process Owner and Team
 Define Resources
 Evaluate Key Organizational Support
 Develop Project Plan and Milestones
 Develop High Level Process Map
Measure
Met Measure Phase Criteria
 Define Defect, Opportunity, Unit and Metrics
 Detailed Process Map of Appropriate Areas
 Develop Data Collection Plan
 Validate the Measurement System
 Collect the Data
 Begin Developing Y=f(x) Relationship
 Determine Process Capability and Sigma Baseline
No
Define Completion Checklist
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By the end of Define, you should be able to describe for your
Champion:
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What key process is involved (including its Suppliers, Inputs, Outputs,
and Customers)
What about the process output is important to customers
What customers currently think of the process and its output
Why this project is important to your organization and what business
goals the project must achieve to be considered successful
Who the players are on the project (sponsors, advisors, team leader,
team members)
What limitations (budget, time, resources) have been placed on this
project
Six Sigma Problem Statements
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A problem statement has the form:
“WHAT is wrong
WHERE it happened
WHEN it occurred
TO WHAT EXTENT and
I KNOW THAT BECAUSE…”
A problem statement:
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Does not include causes of the deficiency.
Does not include likely actions or solutions.
Is clear and concise and specific.
A good problem statement is essential to a good start.
What is Wrong and Where Does it
Happen?
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A good problem statement will clearly define WHAT is wrong. Examples:
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“Customers are not satisfied with my product…”
“Yields are suffering…”
“Reliability is insufficient…”
A good problem statement will clearly define WHERE the problem occurs.
Examples:
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“Customers in the Midwest Region are not satisfied with my ordering service…”
“Equipment availability for Urgent Care is poor…”
“Document correctness is insufficient in Billing…”
When Was This Seen?
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A good problem statement will clearly explain WHEN the
problem occurred.
• “Customers in the Midwest Region are not satisfied with my
ordering service. Starting in January…”
• “Equipment availability for Urgent Care is poor. Since the
consolidation of services…”
• “Document correctness is insufficient in Billing after the
introduction of flexi-forms”
How Widespread is the Problem?
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A good problem statement will clearly explain the EXTENT of the problem.
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“Customers in the Midwest Region are not satisfied with my ordering service.
Starting in January, complaints have increased 15%…”
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“Equipment availability for Urgent Care is poor. Since the consolidation of services,
delays caused by lack of availability have increased by 40%…”
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“Document correctness is insufficient in Billing after the introduction of flexi-forms.
Errors have increased 28%…”
What is the Standard?

A good problem statement will clearly explain HOW I KNOW there is a
problem. Examples:
• “Customers in the Midwest Region are not satisfied with my ordering
service. Starting in January, complaints have increased 15% at a time
when complaint rates from other regions have remained static”
• “Equipment availability for Urgent Care is poor. Since the consolidation of
services, delays caused by lack of availability have increased by 40%
when the patient traffic has increased by only 5%”
• “Document correctness is insufficient in Billing after the introduction of
flexi-forms. Errors have increased by 28% when the goal of the project
was to reduce errors by 90%”
Primary Metric
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Primary Metric (used to measure process performance)
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The gage used to measure your success
It must be consistent with the problem statement. It is used to track progress
towards your goals and objectives.
It is usually reported as a time series graph of:
• Baseline data – averaged over a year, if available
• Target performance – goal or objective
• Actual (current) performance
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Examples:
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Rolled throughput yield (RTY) [versus FTY]
Process Sigma Level or Ppk
Defects per unit (DPU) [versus Proportion Defective]
The Primary Metric is how the success of your project will be measured
0%
Dec-00
Nov-00
Oct-00
Sep-00
Aug-00
Jul-00
Jun-00
May-00
Apr-00
Mar-00
1%
Feb-00
2%
Jan-00
7%
Dec-99
Nov-99
Oct-99
Sep-99
Aug-99
Return $ As % Sales $
Sample Primary Metric
Product Returns
6%
5%
4%
3%
Baseline
Actual
Objective
Secondary Metrics
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Secondary Metrics:
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Measurements of key input/output features, cycle time, or process resource usage
that may improve as a result of meeting objectives using the primary metric
Can be “Drivers” or “Riders” – i.e. Vital X’s impacting the project (Primary Metric) or
“Good Consequential Metrics”
Examples:
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Primary Metric
Secondary Metric
: Cycle Time
: Reduced backorders
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Primary Metric
Secondary Metric
: Defects per Unit
: Available Floor Space
100%
99%
98%
97%
96%
95%
94%
93%
92%
91%
90%
Dec-00
Nov-00
Oct-00
Sep-00
Aug-00
Jul-00
Jun-00
May-00
Apr-00
Mar-00
Feb-00
Jan-00
Dec-99
Nov-99
Oct-99
Sep-99
Aug-99
Sample Secondary Metric
Pct of Orders Shipped within 24 hours
Problem Statements – Exercise

Break out into your groups. Using the guidelines of this module,
each group will rewrite these problems statements to make
them better:
• The complaint rate for our customer service group is too high,
probably due to all of the new people in the department.
• Food Services order errors are too high. They must be reduced.
• Reduce measurement errors by cleaning the instruments more
often.
• Consumable use is increasing too fast. Reduce consumable cost.
• Long term rolled throughput yield for Accounts Payable billing this
year is 83% versus a past RTY of 95%.
• Long wait time for phone service. It takes customers about 30
minutes to get an order completed.
What is a SIPOC?
S
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Process
A high-level map of your process that includes:
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Inputs
Approximately 4-7 process steps
Inputs that feed the process
The Suppliers (sources) of those Inputs
Outputs that result from the process
The Customers (recipients) of those Outputs
Keep it simple, and think carefully about the scope
Outputs
C
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Why Create a SIPOC Map?
• SIPOC helps your team to:
• Define process boundaries (starting and ending points)
• Identify data collection opportunities
• Clarify who are the true customers of the process
• To avoid “scope creep.”
• To identify likely sources of performance problems
• To expose fundamental issues early in the project that could
change the direction of the team
When to Create a SIPOC
In the Early Stage of Any Project!
Ideas
Process
Information
• All work can and should be considered as a process
Questions to Help with SIPOC
From the Output/Customer End:
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Why does this process exist?
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What products, services or
outcomes does this process
produce?
How does this process end?
Who uses the outputs or
experiences the results from this
process?
Who provides funding or staffing for
the process activities, and who
cares about the quality of outcome?
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From the Input/Supplier End:
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What items or information gets
worked on?
Where do the items or information
come from?
What effect do the inputs have on
the process and on the outcome?
How does this process start?
From the Middle – Inside the Process:
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What major steps happen to convert
inputs into outputs?
What people or resources perform
those steps?
SIPOC - Process Development
Example
SIPOC
NEUTROGENA CORPORATION
Green Belt Project- Line Trial Anytime
SUPPLIERS
INPUTS
Industrial Ingineering
Routing
Maintenance
Cost Estimate
Warehouse
Change Parts
Package Development
Specs
Quality Assurance
B.O.M.
Scheduling
Protocol
Suppliers
Material
PROCESS
LINE
TRIAL
EXECUTION
OUTPUTS
CUSTOMERS
Stability Samples
R&D
Validate Change Parts
MFG
Validate Fill Process
Package Dev
Validate Cost
I.E.
Quality Validation
QA
Labor
START
Create/Deliver
Protocol
STOP
Deliver Supplies/
Change Parts
Line Set Up/Fine
Tune
Contact Line Trial
Team
Fill Product
Deliver Samples/
Documentation
SIPOC Workshop
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Instructions:
• Prepare a SIPOC for the process of baking your cake. Use the
guidelines on the following page.
• Be prepared to share your work with the class.
• 15 minutes to prepare + 2 presentations (5 minutes each)
How to Create a SIPOC Map
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Name the process
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Identify, name, and order the major process steps (approximately 4-7
steps)
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Clarify the boundaries of the process – where it starts and where it
stops
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List key outputs and customers
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List key inputs and suppliers
SIPOC– a Foundation for Next Steps
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The list of Customers from your SIPOC are the starting point for the Voice of
the Customer (step 3)
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The major process steps (macro map) from your SIPOC are the overview for
later detailed process mapping
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The Inputs, Process Steps, and Outputs on your SIPOC generates ideas for
what can and should be measured, which feeds the Data Collection Plan in
the Measure phase
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The SIPOC contains clues about potential root causes that drive performance.
Voice of Customer
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Understand why the Voice of the Customer (VOC) is critical
Know how to create a plan for gathering VOC data
Know both reactive and proactive ways to gather VOC
information
Know how to analyze data through the use of affinity diagrams
and Kano diagrams
Be able to use a CTQ tree diagram to identify customer
requirements and set specifications for them
What Is the Voice of the Customer?
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The term Voice of the Customer (VOC) is used to describe
customers’ needs in a process improvement effort and their
perceptions of your product or service.
Why VOC Is Critical
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VOC data helps an organization and a project to:
• Decide what products and services to offer
• Identify critical features and specifications for those products,
process outputs and services
• Decide where to focus improvement efforts
• Get a baseline measure of customer satisfaction to measure
improvement against
• Identify key drivers of customer satisfaction
Why Collect VOC Data
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Customer requirements change constantly
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Specifications tend to focus on technical data only
VOC Process
1.
Identify
customers
and determine
what you need
to know

2.
Collect and
analyze
reactive
system data
then fill gaps
with proactive
approaches
3.
Analyze data
to generate
a key list
of customer
needs in
their language
4.
Translate
the customer
language
into CTQs
5.
Set
specifications
for CTQs
Outcomes
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A list of customers and customer segments
Identification of relevant reactive and proactive sources
of data
Verbal or numerical data that identify customer needs
Defined Critical to Quality requirements (CTQ)
Specifications for each CTQ
Based on Rath & Strong
VOC Step 1: Identify Customers & Determine What You
Need to Know
1.
Identify
customers
and determine
what you need
to know

2.
Collect and
analyze
reactive
system data
then fill gaps
with proactive
approaches
3.
Analyze data
to generate
a key list
of customer
needs in
their language
4.
Translate
the customer
language
into CTQs
Goal
• Identify your customers
• Decide what you need to know about their needs
• Decide when and how you will get this information
5.
Set
specifications
for CTQs
Who Are Your Customers?
S
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Inputs
Process
Outputs
AB-588.2
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S
What are the outputs of your process? Who are the customers
of that output?
 Are there particular groups of customers whose needs are
especially important to your organization and project success?
Common Customer Segments
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Customer status: Former Customers, Current Customers,
Customers of Competitors, Substitute Customers
 Where they are in the “customer chain”
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Internal user  Distributor End user
Geography
 Industry, Division or Department
 Demographics
Do You Have Customer Segments?
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If your customers seem to have similar needs across the
board, you don’t necessarily have to divide them into
segments
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If you suspect that different groups will have significantly
different needs, and that these differences will influence
how you structure your process, product, or service, then
it will be worthwhile to think in terms of segments
Deciding the What and Why
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Revisit your charter—what is the purpose of your project?
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How does your purpose relate to customer needs?
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What do you need to know about the needs of the customers you’ve
identified to make sure your project’s purpose stays on track?
Sample Questions
For all customers, you should ask questions such as:
1. What is important to you about our process/product/service? (Ask them to
rank each of these needs in order of importance.)
2. What do you think of as a defect?
3. How are we performing on the areas you consider important?
4. What do you like about our product/service?
5. What can we improve about our process/product/service?
What can we do to make your job easier?
6. What specific recommendations would you make to us?
VOC Step 2: Collect and Analyze Reactive and Proactive Data
1.
Identify
customers
and determine
what you need
to know
2.
Collect and
analyze
reactive
system data
then fill gaps
with proactive
approaches
3.
Analyze data
to generate
a key list
of customer
needs in
their language
Reactive
4.
Translate
the customer
language
into CTQs
5.
Set
specifications
for CTQs
systems
•Information comes to you whether you take action or not
Proactive
systems
•You need to put effort into gathering the information
Typical Reactive Systems
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Customer complaints (phone or written)
Problem or service hot lines
Technical support calls
Customer service calls
Claims, credits, contested payments
Sales reporting
Product return information
Warranty claims
Web page activity
•
Reactive systems generally gather data on:
• Current and former customer issues or problems
• Current and former customers’ unmet needs
• Current and former customers’ interest in particular products, process outputs or services
Proactive VOC Systems
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Interviews
Focus groups
Surveys
Comment cards
Data gathering during sales visits or calls
Direct customer observation
Market research, market monitoring
Benchmarking
Quality scorecards
VOC Plan: Final Touches

The last step to finishing your data collection is to decide
specifically how you will obtain the information, within what time
frame the data gathering should take place, and how you will
record the data
VOC Step 3: Analyzing Customer Data
1.
Identify
customers
and determine
what you need
to know


2.
Collect and
analyze
reactive
system data
then fill gaps
with proactive
approaches
3.
Analyze data
to generate
a key list
of customer
needs in
their language
4.
Translate
the customer
language
into CTQs
5.
Set
specifications
for CTQs
Goal is to generate a list of key customer needs in their language.
It is helpful to summarize this information in a meaningful way.
Questions? Comments?