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Six Sigma test on pilot; imple- ment full scale Control the process to sustain gains Define Measure Analyze Improve Control What is the problem? Goal? Customers? Process to improve? What is the ex- tent of the pro- blem? Efficiency Effectiveness What data do we need to get to the root causes? Range of options Solutions Best pragmatic solutions Full range of solutions The select few The “optimal and pragmatic solu- tion“ Small scale pilot Full scale implementation Tactical level Process standardization Process through- put Strategic level Disciplined use of business pro- cess manage- ment by steering committee Key elements Deliver- ables Clarity on what is “in scope“ and what is “out of scope“ In-depth under- standing of how big the problem is and data to get to the bottom of it Data driven rigorous con- clusions on the vital root causes for the problem Fully imple- mented solu- tion based on lessons from pilot Stable process System to keep it stable Fully integrated into business goals Executives fully involved Source:McKinsey DMAIC 6 Six Sigma has had high impact on service businesses Problem definition Reduce accounts receivables to best-practice levels in 24 weeks Organizational enablers and improvement infrastructure CFO sponsor with division heads present at project launch CFO and division heads attend key status reviews Black Belt coach and guide but led by finance manager Project tracked by Six Sigma staff and through steering committee meetings Problem solving methodology and tools DMAIC Tools used on project brain- storming, fishbone, pareto, histo- grams, scatter plots, check sheets, control charts is-is not, force field analysis, simple FMEA, poke-yoke Results Reduced AR by 90% for annual benefits exceeding USD 4 million Sample tools used Fishbone defective invoice Man Measure- ment Machine MethodMaterialEnvironment Defective invoice Training Metrics No check against PO Pareto Recommendations Control chart POT Leads projects and shares responsibility for deliverables Applies “right“ Six Sigma methodology and tools to ensure quality of process Escalate issues to management Trains and coaches team members Proposes Six Sigma improvement projects and responsible for deliverables Resolves issues Promotes Six Sigma strategy and methodology Understands Six Sigma strategy, discipline and tools Six Sigma roles Source:McKinsey 8 Although the impact from Six Sigma has been significant for GE . Percent of sales Six Sigma net financial impact* USD m GE total revenues USD bn -20550760 1,490 2,000 7990100112130 Single performance improvement theme Customer perspective Common language Fact based problem solving Enhanced capabilities Powerful engine for cultural change Facilitated success of other initiatives Hard dollar benefits for GE Soft benefits for GE Source:McKinsey 9 Weaknesses Project-centric Quick wins remove focus on strategic moves Content neutral process prescriptive Needs strong organizational element to succeed Disconnects possible between quality and savings . Six Sigma is not a panacea for all ills it has its own set of strengths and weaknesses Source:McKinsey Lean can complement Six Sigma to overcome many of its major weaknesses Strengths Common language Customer focus Bottom-line results Real line management involvement Fact-based problem solving methodology Comprehensive set of tools Builds new generation of leaders Takes capability of organization to next level Strong infrastructure helps other initiatives 10 More over, few companies are able to use Six Sigma effectively due to a small number of root causes Source:McKinsey Lack of real involvement by top and line management Six Sigma is a program run by a staff organization Rewards and incentives are not aligned with Six Sigma program no breakdown and assignment of targets for line management with accountability tied to incentives Staffing Six Sigma with deadwood instead of top talent Ineffective project selection system Ineffective project management with no drop dead dates for projects No effective system for best practice replication Rapid training of large numbers of people who have no projects to work on Process measures, such as number of people trained, number of projects launched only assess progress and not results Lack of understanding of the difficulties inherent in change management Typical root causes for ineffective Six Sigma implementation 11 Six Sigma space and our capabilities Source:McKinsey Client needsOur capabilities Considering Six Sigma and need an objective assessment of pros and cons Six Sigma is not delivering expected results and need a rapid assessment and recommendations to fix it Need help in accelerating existing and under-performing Six Sigma initiative Need deep subject matter expertise and prescriptive solutions to move to the next level of performance Six Sigma Executive Awareness Training objective view of Six Sigma for executives Six Sigma Diagnostic 3 - 5 day Six Sigma diagnostic of Six Sigma companies Six Sigma Acceleration for comatose programs by building an effective transformation engine to complement their problem solving and tools already in place Infusion of deep prescriptive functional knowledge into companies with robust Six Sigma programs Lean Six Sigma Pricing Sourcing Supply chain management 12 Lean Six Sigma integration 13 Many companies wish to build on their Six Sigma programs The company has launched a company wide Six Sigma program in response to external pressures several years ago A sizeable investment and efforts have been put into resource infrastructure building, and training After showing early returns, the rate of improvement has begun to slow There is interest in further content addition specifically around embracing lean manufacturing Management acceptance and commitment to continuing the Six Sigma program remains high The company would like to continue improvements by seamlessly integrating Lean into the Six Sigma program 14 Despite some common elements lean and Six Sigma have significant differences What is an integrated operating system of principles, practices, tools and techniques . a structured improvement methodology using a standard approach and statistical tools Driving principle Reduce waste Synchronize flows Manage variability Reduce variation Operational KPIs cascaded to front line Project metrics Performance management Lean experts Team leaders Natural teams Infrastructure derive maximum benefit from action learning Sequence delivery of projects, training, and capability building in concert with projects for maximum impact and effectiveness Use a rapid seed and cascade approach in rollout Speed implementation across the organization to take advantage of the existing Six Sigma infrastructure 31 Create a sequenced delivery to match the order of project rollout Typical action sequenceKey knowledge points Create Lean awarenessBasic concepts Overall approach Design CS/FS, select projects Value stream mapping System design Sustain improvements Performance management and improvement goals Overall maintenance Deploy Lean tools Takt time Line balance Standardized work Implement just-do-it basic elements Waste reduction 5S Visual controls Production tracking OEE RCA & problem solving StabilitySMED PM Flow Loops PullKanban Level Basic flow or material & information FlowCell layout Material location 32 Organizational capability building key questions 1. Are the proposed six imperatives in adding lean capability appropriate? 2. Any thoughts on how we can develop deep lean experts at clients? 3. Will the sequenced delivery work well? 33 Good performance management systems can be enhanced by Six Sigma and Lean Basic Performance Management Six Sigma Refinements Specific Lean Enhancements Before adding more advanced practices basic elements of performance man- agement must be mastered Six Sigma is not a substitute for an effective perfor- mance management system Key messages CTQ cascade Timely reviews Disciplined execution Visible accountability Value stream perspective Cascade to front line Balanced metrics Performance dialogue 34 But not if the foundation is not strong Diagnostic conclusions Implications Strong core foundation in per- formance management with enhancements in place from Six Sigma Weak performance management system and Six Sigma serving as de-facto project centric performance management system Implement Lean to further enhance performance man- agement system and realize added value Fix core foundation of per- formance management system and hold off on further addition 35 Performance management key questions 1. How can we overcome the fact that often Six Sigma becomes the default performance management system? 2. Do you agree with the thought that lean enhancements should not be added if the foundation is weak? 36 McKinsey can get involved in multiple activities in the journey Develop a tailored approach for the client building upon the five step process outlined here Conduct the program readiness diagnostic Develop the overall program architecture and roll out plan Design the appropriate KPI cascade to deliver results Assist in initial value stream mapping to aid in project selection and prioritization Develop the capability building plan and materials to conduct initial training Provide lean expertise as necessary Participate in roll out as mutually agreed 37 McKinsey involvement key questions 1. Do you see this topic and the overall approach as being relevant to your clients? 2. Where can McKinsey add greatest value in this journey? 38 Out (erst lschen wenn der master fertig ist!) *Footnote Quelle:Sources SUBTITLE (IF THERE IS A MESSAGE TITLE ONLY) 39 Problem solving methodology, concepts, and tool

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