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Lean, Six Sigma


Lean, Six Sigma & Agile: Putting It All Together September 14, 2006 About Me Arlen Bankston Director, Lean-Agile Consulting Six Sigma Black Belt Certified ScrumMaster ... – PowerPoint PPT presentation

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Title: Lean, Six Sigma

Lean, Six Sigma Agile Putting It All Together
September 14, 2006
About Me
  • Arlen Bankston
  • Director, Lean-Agile Consulting
  • Six Sigma Black Belt
  • Certified ScrumMaster Trainer and Agile
    Methodology Coach
  • 20 Lean and Agile projects implemented over past
    five years

Agenda Topics
  1. Lean Six Sigma in 10 Minutes
  2. The Case for Combination
  3. CC Paces Experience
  4. Discussion

About You
  • Lets take a moment to introduce ourselves
  • Whats your name, company and job role?
  • How familiar are you with Lean, Six Sigma, and/or
  • What do you hope to learn from this discussion?

Some Common Questions
  • Have you ever wondered
  • Am I choosing the right projects?
  • Will they result in improvements my customers
    will feel?
  • Do they fix the most critical issues in my
    business processes?
  • Are they oriented towards the long term?
  • Are they sub-optimizing locally, rather than
    improving globally?
  • Why do so many of my projects lack clear focus
    and objectives?
  • Why are IT projects so disconnected from the
    business processes theyre intended to support?
  • Who is my customer?
  • Is what my customer asks for all that I need to
  • How could a Lean Six Sigma effort with clearly
    defined objectives still fail during

I. Lean Six Sigma in 10 Minutes
Process Improvement Origins
  • Why Were Lean and Six Sigma Developed?
  • Japanese developed many Lean techniques based
    on work by Henry Ford, Dr. W. Edwards Deming
    others to compete with U.S. Auto manufacturers
  • Six Sigma was developed by Motorola to raise the
    standard of Quality to meet competitive

Basic Concepts of Lean
  • Core Concepts
  • Value What the customer is willing to pay for.
  • Value Stream Actions that add value to a product
    or process.
  • Flow The continuous movement of product,
    favoring single-piece flow and work cells versus
    production lines.
  • Pull Replacing only material that is used and
    eliminating excessive inventory.
  • Continuous Improvement A relentless elimination
    of waste on a never-ending basis.

Lean Continuous Improvement Cycle
  • Continuously improve in the pursuit of perfection

1) Specify value in the eyes of the customer
2) Identify the value stream and eliminate waste
3) Make value flow at the pull of the customer
4) Involve and empower employees
5) Continuously improve in the pursuit of
Basic Concepts of Six Sigma
  • Six Sigma Is
  • A scientific method
  • A disciplined approach (DMAIC)
  • A management philosophy
  • Focused on breakthrough improvements
  • Reliant on data and correlation Yf (X1, X2,
  • Sophisticated analytically, requiring complex
  • Driven by executive level support
  • Core Concepts
  • Critical to quality (CTQ) What the customer
  • Defect Failing to deliver what the customer
  • Process capability What your process can deliver
    vs. customer CTQ
  • Variation Process stability consistency over

Basic Concepts of Six Sigma (continued)
  • A 5 step approach founded on asking the right
  • Define What is important to the customer?
  • What are their targets and acceptable
    limitations anything else is considered
  • Measure What is the frequency of defects? How
    many defects?
  • Capability How is the process performing for the
  • Entitlement How good can the existing process
  • Gage RR How good is the data? Is it reliable?
  • Analyze Why, when and where do the defects
  • Data driven analysis to prove what the root
    causes are
  • Improve How can we fix the process/critical
  • How can root causes can be addressed?
  • Control How can we ensure the process remains
  • Develop controls to ensure process improvement is

Lean or Six Sigma?
Program Six Sigma Lean Thinking
Theory Reduce variation Remove waste
Application Guidelines 1. Define 2. Measure 3. Analyze 4. Improve 5. Control 1. Identify value 2. Identify value stream 3. Flow 4. Pull 5. Perfection
Focus Problem focused Flow focused
Assumptions A problem exists, figures and numbers are valued. System output improves if variation in all processes is reduced. Waste removal will improve business performance Many small improvements are better than system analysis.
Primary effect Uniform process output Reduced flow time
Secondary effects Less waste. Fast throughput. Less inventory. Fluctuation performance measures for managers. Improved quality. Less variation. Uniform output. Less inventory. New accounting system. Flow performance measure for managers. Improved quality
  • Commonality of both methodologies
  • Focus on the customer
  • Drive toward understanding exactly what the
    customer wants
  • Improve processes by eliminating/reducing things
    that prevent the process from delivering exactly
    what the customer wants
  • Require continuous effort to ensure improvements
    are sustained

Which is better? Answer Who Cares?
Agile Basics - Key Principles
  • Key Agile principles are
  • Focus on customer value Employ business-driven
    prioritization of features.
  • Iterative Incremental Delivery Create a flow
    of value to customers by chunking feature
    delivery into small increments.
  • Intense Collaboration Face-to-face
    communication via collocation, etc diversified
    roles on integrated teams.
  • Self Organization Team members self-organize to
    fulfill a shared project vision.
  • Continuous Improvement Teams reflect, learn and
    adapt to change work informs the plan.
  • What is Customer Value?
  • The right product, for the right price, at the
    right time.
  • The right product is the product with exactly
    the features that the customer wants.
  • The right price is the price that customer
    believes is a fair deal.
  • The right time is when the customer wants it.

Agile A Lean Execution Engine
  • Agile methods can be interpreted as a Lean
    approach to IT project management and execution.

Lean Principle / Practice Agile Principle / Practice
Kaizen Continuous improvement Iteration Planning Sessions Process Project Reflections
Kanban Information radiation and project transparency Product backlogs Iteration backlogs Daily Standups Burndown charts Project and quality sliders Automated test dashboards
Setup reduction Adaptability to rapid change Automated builds Continuous integration Test-driven development Automated testing
Takt time Delivery based on customer demand Iterative development cycles Incremental development
Work cells Co-located resources for a given task Cross-functional teams Collaborative team environments Generalizing specialist roles Pair Programming
Lean Execution via Agile The Mechanics
  • Agile practices include
  • Release Planning (1) (creates Product backlog)
  • Iteration Planning (2) (creates Iteration
  • Daily Standup
  • Fixed-length iterations and small releases
  • Feature Review (3)
  • Process Reflection (4)

Identify top-priority items and deliver them
early and often.
II. The Case for Combination
Why CC Pace Combined Lean Agile
  • There are many common barriers to Agile adoption
    across an enterprise
  • Large, complex projects
  • Many projects in flight
  • Multiple projects per performer
  • Rigid functional roles
  • Rewards based on legacy process compliance
  • Lack of IT and business alignment
  • Lean concepts offered proven solutions to these
  • Lean Project Portfolio Management
  • Driven by Lean goals and metrics
  • Minimized Work in Process (WIP)
  • Lean Staffing Scheduling
  • Dedicated, cross-functional teams
  • Alignment by platform and value stream
  • Lean Human Performance Management
  • Rewards based on business results
  • Support for generalizing specialist career paths

Process Management Maturity Curve
No process measurement or control
Some breakthrough improvements
Many incremental improvements
  • Continuous Improvement Culture
  • Measurements drive and direct change
  • Kaizen events implement changes quickly
  • Performers identify and address waste within
    their own work
  • Culture is focused on striving towards -- but
    never reaching -- perfection
  • Lean Six Sigma Projects
  • Focus on major value streams
  • Address root causes of process problems
  • Refine LSS metrics and support structures
  • Generate value!
  • Pilot Program
  • Identify map core value streams and processes
  • Select diverse portfolio of pilot projects
  • Launch LSS pilots
  • Measure adapt LSS structure appropriately
  • Integrate LSS into organizational fabric

IT and the Lean Rate of Change
Lean at Three Levels
  • Lean Enterprise
  • Business alignment with and optimization of value
  • Lean IT Organization
  • An IT organization that can support a Lean rate
    of change.
  • Lean Project Execution
  • Projects that use Agile to adapt to change, focus
    on customer needs and deliver value incrementally.

Agiles Contributions
  • Agile execution of process improvements yields
  • Direct, continuously updated linkage to the
    Voice/Heart/Soul of the Customer
  • Ability to handle change beyond initial process
  • Minimized risk by accelerating time-to-value
    through iterative development and incremental
  • Close coordination between Business and IT
  • Focus and refinement of recommended improvements
    at the implementation level
  • An ideal platform for innovation and new product
  • Support for whole-of-life product maintenance and
    continuing development

How Agile Supports Lean Alignment
Agile Projects support true IT alignment with
value streams Lean IT Organizations support
Agile Projects.
Lean Six Sigmas Contributions
  • Lean Six Sigma provides a number of advantages to
    Agile project execution
  • Directed portfolio design
  • Select projects based on critical process
  • Align projects across functional silos
  • Grounded project vision and clear focus
  • Initial Product Backlogs
  • Insight into rationale underlying requirements
  • Stronger business cases
  • Quantitative assessment of feature values
  • Clear linkage of IT efforts to business benefits
  • Means to measure success
  • Key metrics identified for a particular process
  • Measurement and control system in place

Why Combine Lean Six Sigma Agile?
  • Together, Lean Six Sigma and Agile
  • Support incremental improvements with a process
    designed around iterative delivery
  • Tighten feedback loops in process management and
    improvement efforts
  • Accurately measure value generation and strongly
    link to strategic operations
  • Align project portfolios with true, grounded
    business needs
  • Improve execution speed of process improvement

How Might a Combined Approach Work?
  • Most simply
  • Lean Six Sigma projects provide initial
    definition and analysis of process areas
  • Tackle large, complex process issues
  • Provide grounded business cases and clear focus
  • Provide metrics to define success
  • Agile projects are spawned in the Improve phase
  • Utilize output from LSS projects to form Product
  • Members from LSS team are involved in execution
  • Adjustments are made as necessary to initial LSS
    analyses based on exploratory and production data
  • Much richer interactions can be imagined as both
    techniques are adopted throughout an enterprise

Tricky Issues
  • Implementation can face many challenges
  • Process perspective in IT organizations
  • Roles and responsibilities of Lean/Six Sigma and
    Agile champions and performers
  • Balance of analysis and execution
  • Meaningful metrics for project value
  • Human performance management rewarding proper
  • All of the standard Lean Six Sigma Agile

III. CC Paces Experience
CC Paces Experience
  • Lean Project Portfolio Management Analysis
  • Lean Staffing Scheduling Analysis
  • Lean New Customer Acquisition Analysis
  • Lean Six Sigma Access Control Risk Management
  • Lean-Agile Maturity Assessments
  • Lean Six Sigma Marketing and Production Services
  • Lean Six Sigma Enterprise Process Mapping

IV. Discussion
Contact Information
Arlen Bankston Director Arlen.Bankston_at_ccpace.com
PHONE 703 / 631.6600 WEB http//www.ccpace.com
MAIL 4100 Monument Corner Dr., Suite
400 Fairfax, VA 22030
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