Lean Six Sigma Glossary
LEAN SIX SIGMA GLOSSARY
| 5W’s and 2H’s | A rigid, structured approach that probes into and defines a problem by asking a specific set of questions related to a previously defined opportunity or problem statement. The 5W’s and 2H’s stands for
· W1-What? · W2-Why? · W3-Where? · W4-Who? · W5-When? · H1-How did it happen? · H2-How much did it cost? |
| Acceptable Quality Level (AQL) | The percentage or proportion of defects or defectives that is considered satisfactory quality performance for a process or product. |
| Acceptance Decisions | This is the process of making the choice to accept or reject an output based on the risk related to accepting that output and/or your evaluation of the output that is provided. Acceptance Decision is the highest number of non-conforming units or defects found in a sample that permits the acceptance of the lot. |
| ABC Inventory | A methodology for determining inventory levels based on value, space consumption, and turns. Generally the following “rules” apply: (a) “A” type inventory is very expensive (keep as little on hand as is reasonable so you don’t tie up too much cash in inventory (b) “B” type inventory is only moderately or middle of the road expensive (Minimize this inventory to free up cash also, but if you have a little extra it won’t break the bank. (c) “C” type inventory is fairly inexpensive (If it consumes little space and costs very little don’t lose any sleep over it. That said, you should keep this inventory to a reasonable minimum as well. |
| Activity Based Costing (ABC) | A technique for accumulating product cost by determining all costs associated with the activities required to produce the output. |
| Activity Plan | A simple chart that shows a list of implementation activities listed in sequence. It identifies the individual responsible for a particular activity and the projected timing of that activity. |
| Adaptability | The flexibility of a process to handle future, changing customer expectations and today’s individual, special customer requirements. It is managing the process to meet today’s special needs and future requirements. Adaptability is an area largely ignored but is critical for gaining a competitive advantage in the marketplace. Customers always remember how you handle or don’t handle their special needs. |
| Advantage/
Disadvantage Technique |
Lists of advantages and disadvantages of each proposed solution are made. The solution of the most favorable ratio of advantages to disadvantages is assumed to be the best solution. |
| Advocate | An individual/group that wants to achieve change but does not have sufficient sponsorship. |
| Andon Board | A visual control device in a production area, typically a lighted overhead display, giving the current status of the production system and alerting team members to emerging problems. A “Visual Control” device that indicates the “Status” of a machine, line, or process. Frequently audible alarms or warning messages accompany ANDON status lights as a secondary method of communicating a problem has arisen. ANDONS are typically color-coded with these generic colors: (a) Green (Normal Operations) (b) Yellow (It is time for a changeover or planned maintenance) (c) Red (A problem has occurred, the machine or line is “DOWN,” and “Urgent attention is needed. ANDON’s can be very effective in highly automated processes to alert support personnel of problems who must attend to several automated processes at a time or are not located in close proximity to the machines they oversee.
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| Appraisal Costs | These are the costs that result from evaluating already completed output and auditing the process to measure compliance to established criteria and procedures. To say it another way, appraisal costs are all the costs expended to determine if an activity was done right every time. |
| Area Activity Analysis (AAA) | A proven approach used by each natural work team (area) to establish efficiency and effectiveness measurement systems, performance standards, improvement goals, and feedback systems that are aligned with the organization’s objectives and understood by the employees involved. |
| Area Graphs | Convenient methods of showing how 100% of something is apportioned. The most commonly used area graph is the pie chart. |
| Arrow Diagrams | A way to define the most effective sequence of events and control the activity in order to meet a specific objective in a minimum amount of time. It is an adaptation of PERT (Program Evaluation and Review Technique) or the CPM (Critical Path Method). |
| Ask “Why” 5 Times | A systematic technique used to search for and identify the root cause of a problem. |
| Assumption Evaluation | Provides a way of redefining problem statements, analyzing solutions and generating new ideas. |
| Attribute Control Chart | A plot of attributes data of some parameter of a process’ performance, usually determined by regular sampling of the product, service or process as a function (usually) of time or unit number or other chronological variables. This is a frequency distribution plotted continuously over time, which gives immediate feedback about the behavior of a process. A control chart will have the following elements:
· Center Line (CL) · Upper control limit (UCL) · Lower control limit (LCL) |
| Attributes Data | This is counted data that can be classified as either yes/no, accept/reject, black/white or go/no-go. This data is usually easy to collect because it requires only counting and is not measuring the process, but it often requires large samples. |
| Automation | The use of robots, machinery or software to eliminate repetitive and boring jobs previously done by people. Automation is the automatic operation and control of machinery or processes by devices such as robots that can make and execute decisions without human intervention. |
| Autonomation | Automation with a human touch. Refers to semi-automatic processes where the operator and machine work together. Autonomation allows man-machine separation. Stopping a machine automatically or without intervention when a defective part has been created. Some forms of Autonomation do include human intervention to detect defective parts but the ideal is to have a machine detect a defective part and then correct the problem on its own. Autonomation devices can be very complex involving sensing equipment, lasers, scales, etc. or it can be as simple as parts not being able to pass through a dimensional gauge. This method typically causes a backing-up of the system which at some point triggers a shut-down switch or alarm to gain operator attention to the problem. (Note: Also referred to Jidoka). |
| Average Incoming Quality (AIQ) | AIQ is that average quality level going into an inspection point. |
| Average Outgoing Quality (AOQ) | AOQ is the average quality level leaving an inspection point when the rejected parts have been removed from the line. |
| Axiomatic Design | This approach provides a framework of principles that guide the design engineers of products, services or processes. The approach reduces the complexity of the design process. Its purpose is to make the human designer more creative by reducing the random search process, thereby minimizing the trial and errors that are made during the design process. |
| Balanced Production | All operations or cells produce at the same cycle time. In a balanced system, the cell cycle time is less than takt time. When a manufacturing system/entity produces “exactly” (+ or -) what their customers demand it is said to be “in balance” (Note: Takt Time is the measurement most often used to determine if a manufacturing plant is “balanced.” If a product’s Takt Time is “1 part every 30 seconds” and the manufacturer can only produce “1 part every 40 seconds” then there will be a shortfall and the plant is not “in balance” with it’s customers Likewise, if a plant produces “1 part every 15 seconds” they are overproducing (see 7 wastes), and are not “in balance” with their customers. |
| Bar graph | Have bands positioned horizontally (bars) or vertically (columns) which, by their height or length, show variations in the magnitude of several measurements. The bars and columns may be multiple to show two or more related measurements in several situations. |
| Batch-and-Queue | Producing more than one piece of an item and then moving those items forward to the next operation before that are all actually needed there. Thus, items need to wait in a queue. |
| Batch Manufacturing (a.k.a. “Batch Processing) | Producing lots or quantities of a product in order to achieve maximum “Economic Order Quantities” (EOQ). Although some products must be batched to maximize use of equipment with long cycle times, often batching is wrongly assumed to be more economical than single piece production for various reasons. Often when large “batches” are the preferred operating mode it is due to excessively long or difficult changeover practices. Improving changeover techniques through SMED implementation will generally minimizes lot or “batch” sizes, reduce finished goods inventory on-hand, allow for increased varieties of products that can be made more quickly, and ultimately lead to greater customer responsiveness. |
| Bell-Shaped Curve | The shape of a normal distribution curve. |
| Benchmark | A reference point where other items can be compared. It can be a location, a process, a measurement or a result. |
| Benchmarking (BMKG) | The process of measuring products, services, and practices against those of leading companies. Also used as a comparison tool used to determine the level of process, product, or other successes your company is experiencing when compared to similar companies with similar products or processes; typically competitors. Methods include tracking metrics like On-time Delivery, Defective Parts Per Million produced, and wages paid, market share growth and projections, etc. Most successful companies use benchmarking to identify strengths and weakness as compared to competitors and make needed adjustments. |
| Best Practice | A process or a method that is superior to all other known methods. |
| Best-Value-Future-State Solution | A solution that results in the most beneficial new item as viewed by the item’s stakeholders. It is the best combination of implementation cost, implementation cycle time, risk, and performance results (examples: return-on-investment, customer satisfaction, market share, risk, value-added per employee, time to implement, cost to implement, etc.) |
| Blitz (See Kaizen Blitz) | A blitz is a fast and focused process for improving some component of business a product line, a machine, or a process. It utilizes a cross-functional team of employees for a quick problem-solving exercise, where they focus on designing solutions to meet some well-defined goals. |
| Block Diagrams | A pictorial method of showing activity flow through a process, using rectangles connected by a line with an arrow at the end of the line indicating direction of flow. A short phrase describing the activity is recorded in each rectangle. |
| Bottleneck | Any resource whose capacity is equal to or less than the demand placed on it. The slowest operation (choke point) in a manufacturing process; not to be confused with a company’s “Constraint” taken from TOC (Theory of Constraints), which is the slowest operation in an entire manufacturing system that, if remedied, would increase overall company throughput. |
| Brainstorming | A technique used by a group to quickly generate large lists of ideas, problems, or issues. The emphasis is on quantity of ideas, not quality. |
| Budget | Provides the resources required to implement the tactics. |
| Bump-Back | Helping the person(s) before or after another person in a manufacturing cell or system. If one operation is a little faster than that of the person before who supplies the work, in some cases we can finish part of their process so that the operator will continue to have parts to work on. If too much Bump-Back work is happening it may be that you should re-evaluate the tasks undertaken at each work station in the cell. |
| Business Case Development | An evaluation of the potential impact a problem has on the organization to determine if it is worthwhile investing the resources to correct the problem or take advantage of the opportunity. |
| Business Objective | Defines what the organization wishes to accomplish over the next 5-10 years. |
| Business Plan | A communication, planning and business system that reaches and involves every employee in support of common goals and objectives. It is a three-way interactive process that provides direction, expectations, and funding. It also defines the activities required to meet the agreed upon expectations. It includes the following 11 outputs:
· Direction 1. Visions 2. Mission 3. Values 4. Strategic Focus 5. Critical Success Factors · Expectation 6. Business Objective 7. Performance Goals · Action 8. Strategies 9. Tactics 10. Performance Plans 11. Budget |
| Business Process Improvement (BPI) | This is a breakthrough methodology that includes process redesign, process reengineering, process benchmarking, and fast action solution teams. |
| Calibration | Comparing an instrument or measurement equipment performance to a standard of known accuracy. Normally the standards are traced back to the National Bureau of Standards. |
| Capability | The maximum achievable results that can be attained in a manufacturing system based on limitations imposed. Example: McDonald’s could not build a complete aircraft carrier in it’s’ kitchen, but it could create a fine “Big-Mack.” Size, weight, complexity of parts, environmental regulations, and processes (to name a few) all figure in to determining the capability of a manufacturing system. |
| Capacity | The maximum amount a process, machine, or system can produce. If a machine is running “at capacity” it is going as fast as it can go and producing as much as it can produce. If a machine is running “below capacity” it is able to do more than it is currently doing. It is sometimes not necessary or desirable to run machines “at capacity.” Most cars will exceed 100 miles per hour but that excess capacity is typically not needed or advisable. |
| Capacity Constraint Resources | Where a series of non-bottlenecks, based on the sequence in which they perform their jobs can act as a constraint. |
| Catch-Ball | A series of discussion between managers and their employees during which data, ideas, and analysis are thrown like a ball. This opens productive dialogue throughout the entire company. |
| Cause-and-Effect Diagram | A visual presentation of possible causes of a specific problem or condition. The effect is listed on the right hand side and the causes take the shape of fish bones. This is the reason it is sometimes called a “Fishbone Diagram.” It is also called “Ishikawa Diagram.” |
| Cells | The layout of machines of different types performing different operations in a tight sequence, typically in a U-shape, to permit single piece flow and flexible deployment of human effort. |
| Cellular Manufacturing | (a.k.a. U-Shaped Cells, Work Cells) Generally a horseshoe or U-Shaped work area layout that enables workers to easily move from one process to another in close proximity and pass parts between workers with little effort. “Cells” typically focus on the production of specific models in “part families” but can be adjusted to many different products as needed. Work Cells do not need to be in a U-shaped configuration though this is often common due to maximizing product throughput with minimal use of space. We have created Work Cells in many different configurations that resemble letters like S, T, W, X, V, etc.; it is also common to create polygons, circles, rectangles, etc. The ultimate layout of the cell is determined by the needs of the product. The goal in laying out a new Work Cell is to pass a part through every needed process with the minimal amount of wasted motion and distance. On the next level the layout of the Work Cell is determined by the manual and machine cycle times and “Takt Time” in order to determine Cell staffing. Other issues when creating cells include redundancy of equipment; size of equipment needed, cure times, and Cell mobility/flexibility to accommodate multiple products. When Work Cells are laid out most efficiently they can usually produce parts with a staff of 1 person moving from station to station (Load-Load), or fully staffed with a worker at each station, and product demand helps determine staffing. |
| Chaku-Chaku | A method of conducting single-piece flow, where the operator proceeds from machine to machine, taking the part from one machine and loading it into the next. |
| Change Agent | The catalytic force moving firms and value streams out of the world of inward-looking batch-and-queue. |
| Change-Overs | Switching from producing one part/product to another is generally known as a changeover. This switching or Changeover process may involve removing and replacing dies from machine beds, removing and replacing unused materials such as changing from corn to wheat in a food hopper, black plastic to white plastic in an injection molding bin, etc. In Lean Manufacturing terms, changeovers are best accomplished through SMED (Single Minute Exchange of Die), which strives to complete a changeover in less than 10 minutes or less. Also, it can involve the installation of a new type of tool in a metal working machine, a different paint in a painting system, a new plastic resin and new mold in an injection molding machine, new software in a computer, and so on. |
| Check sheet | A simple form on which data is recorded in a uniform manner. The forms are used to minimize the risk of errors and to facilitate the organized collection and analysis of data. |
| Collecting Data | A systematic way of acquiring information about a specific point of interest. |
| Co-Location | Physically locating personnel and product lines in a single area thereby enabling rapid and constant communication among the key personal responsible for those products. Many companies now co-locate sales, customer service, engineering, administrative, production, and other functions in an attempt to create a fairly independent and full-service department that focuses on a single product or product family. There are pros and cons to this approach as many redundant roles are common. The up-side is that there is an expertise and almost “omniscient” awareness of customer needs, and production status. |
| Common Cause | A source of errors that is always present because it is part of the random variation in the process itself. These types of failures are normally traced back to the process which only management can correct. |
| Communication Techniques | The many processes that are available to deliver and send messages through an organization by various channels, such as e-mail, meetings, gossip, newsletters, etc. |
| Comparative Analysis | A systematic way of comparing an item to another item to identify improvement opportunities and/or gaps. (It is the first three phases in the benchmarking process.) |
| Competitive Benchmarking | A form of external benchmarking that requires investigating a competitor’s products, services, and processes. The most common way to do this is to purchase competitive products and services and analyze them to identify competitive advantages. |
| Conflict Resolution | An approach to find a win-win solution when two or more parties are in disagreement with each other. Often, conflict resolution ends up with a compromise on the position each party took in the original conditions. |
| Consensus | An interactive process, involving all group members, where ideas are openly exchanged and discussed until all group members accept and support a decision, even though some of the groups’ members may not completely agree with it. To reach a consensus after is time consuming and often involves individual compromising. |
| Constraint | Anything that limits a system from achieving higher performance, or throughput. Taken from (TOC) “Theory of Constraints” A constraint is anything that limits a system from achieving higher performance relative to its’ goal. In practical application a “Company’s Constraint” is the biggest limiting factor that reduces the amount of throughput the company can achieve. This may mean a machine or process that is the slowest operation (bar none). A company can have many bottlenecks, but in order to be the Constraint of the company it must be the “Alpha Bottleneck” that affects the throughput of the company as a whole. Some companies have more than one Constraint. Although one may be slightly larger than another, working to “break” 2 or 3 constraints of approximately the same size or limiting nature simultaneously is a worthwhile pursuit. |
| Continuous Flow Manufacturing (CFM) | This is a manufacturing system that is set up where there is no buffer between individual activities. The product is continuously moving without going into a storage area. |
| Continuous Improvement | The ongoing process/philosophy of doing things better, faster, and cheaper. A Lean Manufacturing system or organization will usually effect many large-scale and far-reaching changes while implementing Lean as a company directive. After the big “bang for the buck” Lean tools have been implemented there can be a tendency toward complacency. A structured Continuous Improvement process enables an organization to refine and enhance the benefits they now enjoy as a Lean company through usually small and incremental changes within the system. Example: Stamping press #8 typically produces 27 parts per minute (ppm) but “Takt Time” tells us we now need 30 ppm. The press is already running “at capacity” so a decision must be made to purchase a similar press or somehow get 3 more ppm out of press #8. Using a Continuous Improvement Process, a Kaizen Team would carefully examine the possibility of getting more production out of the machine before buying another one. Perhaps replacing worn belts, hydraulic pumps, regulators, shortening the “stroke” of the machine, or any number of other fixes would improve the machine enough to avoid buying a new one to meet current demand. |
| Controllable Poor-Quality Costs | These are the costs that management has direct control over to ensure that only acceptable products and services are delivered to the customer. It is divided into two subcategories: prevention costs and non-value-added costs. |
| Corrective Action | This is action that is taken to prevent reoccurrence of a problem. It is usually taken when an error/nonconformity is detected that warrants expending effort and money to prevent it from reoccurring. |
| Cost Driver | Any factor which causes a change in cost of an activity. |
| Cost of Quality | This was a process developed by Val Feigenbaum when he was Quality Director at a General Electric Division in the 1950s and put all the quality-related activities into a single cost base that could be added together. It was made up of four parts: Prevention Costs, Internal Defect Costs, External Defect Costs, and Appraisal Costs. |
| Creative Thinking | A methodology designed to stimulate and encourage creativity and innovation within an organization and individuals. |
| Creativity | Developing new or different ideas. |
| Critical Path Methodology | This is normally used with a project work breakdown structure where there is one path through the complex process that determines when the process is completed. By identifying this path the project manager can focus on ensuring that cycle time and cost are optimized thereby minimizing the risk of not completing the budget on time and on schedule. |
| Critical to Quality (CTQ) | These are key measurable characteristics of a product or a process that are set to ensure customer satisfaction. They help ensure that the improvement activities are in line with the customer requirements. These customers can be either internal or external customers. |
| Cultural Roadblocks | Each organization had its own set of acceptable and unacceptable behavioral patterns. Cultural roadblocks are those unacceptable behavioral patterns that will have a negative impact upon completing a project. |
| Current State Maps | Taken from Value Stream mapping (VSM), the Current State Map shows the value stream or process map as it is operating right now. Very often the “Current State Map” will illustrate significant differences between how things are in reality and the documented processes and procedures. They help visualize the current production process and identify sources of waste. They are typically used to identify where in a process the 8 Wastes are present. The “Current State Map” is used as a springboard for creating an “Ideal State Map” which (with significant improvements) removes wasteful practices from the value stream. |
| Customer Requirements | These are stated or implied terms that the customer requires to be provided with in order for him or her not to be dissatisfied. |
| Customer Surveys | Obtaining customers’ opinions related to the service or products supplied. This can be done in many ways including phone calls, written surveys, focus groups, one-on-one meetings, etc. |
| Customer-Dissatisfaction Poor Quality Costs | These are the lost profits because customers buy competitive products because they perceive that the competitor’s product is better quality or because the customer has had or knows someone that has had an unsatisfactory experience with the organization. |
| Customer-Incurred Poor Quality Costs | These are the costs that the customer incurs when a product or service fails to perform to the customer’s expectations. Example: Loss of productivity while equipment is down or travel costs and time spent to return defective merchandise, and the repair cost after the warranty period. |
| Cycle Time | The time required to complete one cycle of an operation. The time it takes to do one repetition of any particular task typically measured from “Start to Start” the starting point of one product’s processing in a specified machine or operation until the start of another similar product’s processing in the same machine or process. Cycle time is commonly categorized into: (a) Manual Cycle Time: The time loading, unloading, flipping/turning parts, adding components to parts while still in the same machine/process etc. (b) Machine Cycle Time: The processing time of the machine working on a part. (c) Auto Cycle Time: The time a machine runs un-aided (automatically) without manual intervention. (d) Overall Cycle Time: The complete time it takes to produce a single unit. This term is generally used when speaking of a single machine or process. (e) Total Cycle Time: This includes all machines, processes, and classes of cycle time through which a product must pass to become a finished product. This is not Lead Time, but it does help in determining it. In most cases it doesn’t matter very much which form of cycle time is greatest. What does matter is that your “Total Cycle Time” is less than your Takt Time.” |
| Cycle Time Analysis | An approach to reduce the time that it takes to move an item through a process. |
| Demand Management | Prediction of the levels of weekly or monthly product activity over a specified time (generally about two years). MRP II systems seem to be at least in part responsible for encouraging this practice. |
| Design for Maintainability and Availability | This is a methodology and tool set that is directed at analyzing the maintenance of a product to minimize the time to repair it and to maximize its total reliability. The object here is to minimize downtime. Often it involves modular replacement rather than individual component replacement. |
| Design for Manufacturing and Assembly (DFMA) | This is a methodology that is used to determine how to design a product for ease of manufacturing. It is usually done by performing concurrent engineering, where manufacturing engineering develops the manufacturing process along with the design. |
| Direct Poor Quality Costs | These are costs that can be identified in the organization’s ledger.
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| Discrete Data | Discrete data is based on count. It cannot be broken down into subdivisions. For example, it is the number of customer complaints that are received per week. It is also referred to as Qualitative Data. |
| Effectiveness | The extent to which an output of a process or subprocess meets the needs and expectations of its customers. A synonym for effectiveness is quality. Effectiveness is having the right output at the right place at the right time at the right price. Effectiveness impacts the customer. |
| Efficiency | The extent to which resources are minimized and waste is eliminated in the pursuit of effectiveness. Productivity is a measure of efficiency. |
| Equipment Certification | This is an evaluation of each piece of equipment to define its accuracy, repeatability, drift and capabilities so that it can be matched to the product specifications. |
| Equipment Poor-Quality Costs | This is the cost invested in equipment used to measure, accept or control the products or services, plus the cost of the space the equipment occupies and its maintenance costs. This category also includes any costs related to preparing software to control and operate the equipment. |
| Error Proofing | Lean tool for making products correctly the first time, designing a potential failure or cause of failure out of a product or process. When thoroughly implemented Error & Mistake-Proofing create improvements on many different levels. Even the products themselves may be redesigned to minimize errors in their manufacture. Tooling and processes are often reworked to produce error-free parts or at minimum catch errors before they become significant defects that require rework or become scrap. Example: One common and popular example of Mistake-Proofing is the design of the VHS video tape player. A videotape will only fully enter a VCR and play if it is placed correctly into opening. |
| Establish the Burning Platform | Define why the as-is-process needs to be changed and prepare a vision that defines how the as-is pain will be lessened by the future-state solution. |
| External and Internal Customers | All organizations have internal and external customers. The output from any activity within an organization that goes to another individual within the organization has created an internal customer-supplier relationship. The person who receives the input is the internal customer. External customers are individuals or organizations that are not part of the organization that is producing the product. They typically buy the product for themselves or for distribution. |
| External Set-Up | Steps and procedures that can be performed while a machine is still operating that facilitate the SMED (Single Minute Exchange of Die) process. The most powerful technique used in many SMED applications is converting all “Internal Setup” (procedures that can only be completed while a machine is not operating) to “External Setup” procedures. Typically this one step will reduce setup/changeover times by + or – 50%! |
| Facilitation of Teams | This is an individual who is assigned to work with the team to make the meetings run more effectively. They work to ensure that the team functions correctly, not to participate in solving the problem. |
| First Time Yield (FTY) | This is the number of good parts that go into an operation divided by the number of acceptable parts going out of the operation without any rework. First-time yield for a total process is calculated by multiplying the first-time yield at each activity times the first-time yield at each activity in the process. It represents the number of parts that go through the process without being reworked or scrapped. It is also called Roll Through Yield (RTY). |
| Five “S s” or Five Pillars | A system designed to bring organization to the workplace. A translation of the original 5S terms from Japanese to English went like this:
· Seiri-Organization · Seiton-Orderliness · Seiso-Cleanliness · Seiketsu-Standardized Cleanup · Shitsuke-Discipline In order to assist users of this tool to remember the elements the original terminology has been retranslated to the following 5S’s. · Sort · Set in Order · Shine · Standardize · Sustain |
| Five Whys (5 Ws) | This is a technique to get to the root cause of the problem. It is the practice of asking five times or more why the failure has occurred in order to get to the root cause. Each time an answer is given, you ask why that particular condition occurred. |
| Flexible Manufacturing | A manufacturing process/system designed so that production areas (such as work cells or lines) can be changed and rebalanced often to adjust labor and materials to better meet and match demand. In a manufacturing cell we often use reversible supply racks and alternate hanging tools that could be immediately employed when the cell would covert from one product line (Brand) to another. |
| Flow | A main objective of the lean production effort, and one of the important concepts that passed directly from Henry Ford to Toyota. Ford recognized that, ideally, production should flow continuously all the way from raw material to the customer and envisioned realizing that ideal through a production system that acted as one long conveyor. |
| Flowchart | A method of graphically describing an existing process or a proposed new process by using simple symbols, lines, and words to pictorially display the sequence of activities in the process. |
| FOCUS | This is a synonym for:
– Find a process to improve – Organize an effort to work on improvement – Clarify current knowledge of the process – Understand process variation and capabilities – Select a strategy for continuous improvement This was developed by W. Edwards Deming and provides his model for improving processes. It was based upon Shewhart’s Plan, Do, Check, Act approach. |
| Focus Groups | A group of people who have a common experience or interest is brought together where a discussion related to the item being analyzed takes place to define the group’s opinion/suggestions related to the item being discussed. |
| Force Field Analysis | A visual aid for pinpointing and analyzing elements which resist change (restraining forces) or push for change (driving forces). This technique helps drive improvement by developing plans to overcome the restrainers and make maximum use of the driving forces. |
| Functional Layout | The non-Lean practice of grouping machines or activities by type of operation performed. |
| Function Diagrams | A systematic way of graphically displaying detailed tasks related to broader objectives or detailed issues related to broader issues. |
| Future State Mapping | This usually takes the form of a flow diagram or a simulation model where a proposed change is drawn out pictorially to better understand the process. In the case where a simulation model is developed, the process can be operated over a period of time based on the assumptions made in the simulation model to determine how effective it will operate. |
| Gantt Chart | A Gantt chart is a bar chart laid on its side. It is typically used for conveying a project schedule. It is an effective way of identifying interrelationships between tasks and helping to define critical paths through a process or project. |
| Gap Analysis | A gap analysis is used to compare a present item to a proposed item. It typically will compare efficiency and effectiveness measurements between one product to a competitor’s product or one process to another process. It reveals the amount of improvement necessary to bring it in line with the process or product it is being compared to. |
| Gemba | A Japanese term that means ‘Real Place’ or ‘Where the action takes place.’ In Lean we speak of GEMBA as being the place where ‘value’ is added to a product. In the most practical sense Lean attempts to make everything in a factory Gemba, or a value adding process or location. The antonym of Gemba is Muda, or ‘Waste’ which Lean practitioners do all in their power to eliminate. |
| Graphs | Visual displays of quantitative data. They visually summarize a set of numbers or statistics. |
| Group | Individuals who are gathered together for administrative purposes only. Individuals work independently, sometimes at cross purposes with others in the group. |
| Group Technology | Group Technology separates parts into “Families” or groups that have similar needs with respect to manufacturing processes. Parts may be “grouped” by size weight, color, flavor, chemistry, treatments/special processing needed, etc. Creating “Part Families” or “Groups” can result in lower inventories, reduced consumption of process resources, and many other benefits. On an intuitive level and for the purpose of identifying and exposing the ‘Value Stream’ grouping parts into ‘families’ can help to identify further improvement opportunities. |
| Hard Consensus | When all members of the team absolutely agree with the outcome or solution. |
| Heijunka Box | A method of leveling production at the final assembly line that makes just-in-time production possible. This involves averaging both the volume and sequence of different model types on a mixed-model production line. |
| Histograms | A visual representation of the spread or distribution. It is represented by a series of rectangles or “bars” of equal class sizes or width. The height of the “bars” indicates the relative number of data points in each class. |
| Hoshin Kanri | This in an annual planning process that is used to develop the Hoshin plan or policy development. It is used to set the direction of the improvement activities within the organization. Hoshin is made up of two Chinese words: Ho, which means method or form, and Shin, which means shiny needle or compass. Kanri means control or management. It is a very systematic, step-by-step planning process that breaks down strategic objectives against daily management tasks and activities. |
| Independent Variable | An independent variable is an input or process variable that can be set directly to achieve a desired result. A variable that we control during an experiment. |
| Indirect Cost | These are the costs that are imposed on an output that is not directly related to the cost of the incoming materials or the activities that transform it into an output. It is all the support costs that are needed to run the business that are applied against the product in order to make a profit. For example, the cost of accounting, personnel, ground maintenance, etc. |
| Indirect Poor Quality Costs | Costs that are incurred by the customer or costs that result from the negative impact poor quality has on future business, or lost opportunity costs. |
| Initiating Sponsor | Individual/group who has the power to initiate and legitimize the change for all of the affected individuals. |
| Innovation | Creating something new i.e., an idea, device or processing method; Invention. Identified by Ideation International as the “8th Waste” in “Ohno’s 7 Wastes of Manufacturing,” it recognizes that the potential for innovation available in every workforce goes largely unrealized. |
| Intangible Benefits | These benefits are gains attributed to an improvement project that are not documented in the formal accounting process. They are often called “soft benefits.” Frequently they are savings that result from preventive action that stops errors from occurring. |
| Internal Error Costs | The costs incurred by the organization as a result of errors detected before the organization’s customer accepts the output. In other words, it is the costs the organization incurs before a product or service is accepted by the customer because someone did not do the job right the first time. |
| Internal Set-up | Taken from (SMED), these are setup procedures that can only be affected when a machine is in a ‘Zero Mechanical State.’ The goal of SMED is to change dies or other components/processes in less than 10 minutes. Internal Setup elements that require machines to be completely inoperable are one of the greatest sources of waste during a setup/changeover process. Therefore, much time and attention is dedicated to discovering how machines can continue running during most or all of the changeover process. If a SMED Kaizen Team can make Internal Setup procedures ‘External’, then they will generally reduce setup/changeover times by at least 50%. |
| Interviewing | A structured discussion with one or more other people to collect information related to a specific subject. |
| Inventory | The money and materials invested in by a company in order to create products for sale. In reality, there are few areas that can yield more outstanding initial cost savings than the reduction of inventory in many, if not most companies. Inventory must be viewed as ‘MONEY’ and treated accordingly. The most common types of Inventory are: (a) Raw Materials: Un processed components waiting for work to be done on them, and is the least expensive form of inventory, especially if suppliers will wait for payment until you begin using these materials; (b) Work In Process (W.I.P.): Materials that have had some work done to them but are not yet finished. This is the second most expensive form of inventory as “value” has been added to the materials; and (c) Finished Goods: This is the most expensive type of inventory as the materials have already traveled through the value stream and are now complete. Although most companies carry some Finished Goods Inventory it can be a serious waste and burden on cash-flow. |
| Inventory Turnover Rate | The number of times an inventory cycles or turns over during the year. A frequently used method to compute inventory turnover is to divide average inventory level into annual cost of sales. The number of times you can “Turn” (use and replace) your inventory/money over in a year. For example, if your company holds $1000 worth of inventory every month and consumes $1000 worth of inventory every month, which would equal “12 Inventory Turns per year.” The real world is not as clean as the example above, and it can be challenging to know how many times each year you ‘turn’ your inventory. Some companies will speak of inventory turns specific to individual parts or materials, i.e., “We turn our raw widget parts every week,” or “we have 24 turns a year on our coiled steel.” The Lean message behind Inventory Turns is to keep enough inventory on-hand to satisfy your customers but not so much that it winds up collecting dust and costing you money in the form of lost interest, damage, obsolescence, storage space, moving it around, etc |
| Hoshin Planning | Also known as Management by Policy or Strategy Deployment. A means by which goals are established and measures are created to ensure progress toward those goals. HP keeps activities at all levels of the company aligned with its overarching strategic plans. HP typically begins with the “visioning process” which addresses the key questions: Where do you want to be in the future? How do want to get there? When do you want to achieve your goal? And who will be involved in achieving the goals? HP then systematically explodes the what’s, who’s and how’s throughout the entire organization. |
| Just-in-Time | Principles that are fundamental to Time-Based Competition, waste elimination, process simplification, set-up and batch-size reduction, parallel processing, and layout redesign are critical skills in every facet of the lean organization. JIT is a system for producing and delivering the right items at the right time, in the right amounts. A Lean Manufacturing process for synchronizing materials, operators, and equipment such that all materials and people are where they need to be, when they need to be there, and in the state they need to be there in. JIT is ultimately focused on reducing or eliminating every form of waste in the manufacturing process. Many Lean Manufacturing tools help to make achieving a Just-in-Time system possible. Example: It doesn’t matter much if materials arrive at a machine for processing when the machine is “down” due to poor maintenance. A TPM “Total Productive Maintenance” program could remedy this situation. Likewise, if it takes several hours to change-out dies materials could spend substantially more time waiting for processing than actually being processed. SMED efforts are warranted to enable quick changeovers and allow JIT methods to be effectively employed. The key elements of Just-in-Time are Flow, Pull, Standard Work, and Takt Time. |
| Kaban | A signaling device that gives instruction for production or conveyance of items in a pull system. Can also be used to perform kaizen by reducing the number of Kanban in circulation, which highlights line problems. Comes from a Japanese term meaning ‘visual record’ or ‘card.’ In Lean Manufacturing, Kanban has come to mean signal. Kanban signals are basically just telling workers that there is more work to be done. In other words, the presence of a ‘Kanban Card’ or an empty ‘Kanban Location’ is a “signal” to do the work described on the card (make the parts) or fill the empty Kanban location with parts which means you have to make them to put them there. There are many ways to use and implement Kanban, like empty totes, pallets, cartons, flashing lights, electronic messages, etc. You can even park a semi truck at a certain dock and that could be your signal to produce parts that will be shipped via this truck. There is no limit to the creativity you can have with Kanban signals. One key is to make them work in your specific situation and environment. Perhaps the most important rule of Kanban is to “Obey Kanban.” In other words do not go around the system or it will fail. Failing to keep the rules of Kanban will result in higher inventories, greater risk for errors/defects, and other associated problems. Now that we have emphasized keeping the rules of Kanban we must discuss a few reasonable exceptions. Breaking Kanban limits to production should occur if a machine has broken but will be able to catch up as soon as it is repaired. Yes, you will be building inventories, but this machine cycles faster than the feeding machine(s) and will be able to process the temporary glut of WIP (Work in Process) parts. One more exception might be breaking Kanban to create parts for a customer or sister company that suddenly and desperately needs parts that are only finished to a certain degree. You may find yourself off-loading a machine or process to feed temporary work cells to meet this unexpected and “temporary” demand. |
| Kaikaku | This is a revolutionary type of activity, while Kaizen is evolutionary. Kaikaku is similar to process reengineering or redesign. |
| Kaizen | This is a Japanese term that means continuous improvement. Kai means change and zen means good or for the better. |
| Kaizen Blitz | This means a sudden, overpowering effort to take a process, system, product or service apart and put it back together in a better way. |
| Kano Model | This is a model that was created by Prof. Noriaki Kano that classifies customer preferences into five categories. They are: attractive, one-dimensional, must-be, indifferent, and reverse. The Kano Model of customer satisfaction classifies product attributes based on how they are perceived by the customer and their effect on customer satisfaction. This model is useful in guiding the organization in determining when good is good enough and more is better. |
| Key Performance Indicators
(KPI) |
KPI stands for “key performance indicators.” These measurements indicate the key performance parameters related to a process, organization or output. They are the key ways by which that item is measured and are usually used to set performance standards and continuous improvement objectives. They are sometimes called CPI (critical performance indicators). |
| Knowledge Management | This is a system for capturing the knowledge that is contained within an organization. It groups knowledge into two categories. The first classification is tacit knowledge (soft knowledge). This knowledge is undocumented, intangible factors embodied in an individual’s experience. The second classification is explicit knowledge (hard knowledge). This knowledge is documented and quantified. |
| Leader Standard Work | A defined set of standard practices completed by management. These typically include a regularly scheduled gemba walk to pre-selected processes to review standard practices in that area. Every one in the organization that supervisor’s people should have standard work.
Typical Standard Work Percentages of total work time: – Operators = 95 + % – Supervisors = 90 % – Department Managers = 20 % – Senior Managers = 10 % |
| Lead Time | The total time a customer must wait to receive a product after placing an order. When a scheduling and production system is running at or below capacity, the lead time and throughput time are the same. When demand exceeds the capacity of a system, there is additional waiting time before the start of scheduling and production, and lead time exceeds throughput time. The time required from receipt of order until products are shipped to a customer. Sometimes the single biggest difference between competing companies is the amount of Lead-Time they will commit to. If company Alpha promises they will have your products delivered to your door in six weeks and company B promises a one-week delivery which company will you likely choose? Lean Manufacturing has many tools that ultimately reduce Lead-Time and win market share. Oddly enough Inventory in a manufacturing system has the limiting effect of increasing Lead-Time. |
| Lean | Business processes requiring less human effort, capital investment, floor space, materials, and time in all aspects of operation. |
| Lean Accounting | A method of accounting that is aligned horizontally across your organization with the value stream. Traditional costing structures can be a significant obstacle to Lean Six-Sigma deployment. A Value Stream Costing methodology simplifies the accounting process to give everyone real information in a basic understandable format. By isolating all fixed costs along with direct labor we can easily apply manufacturing resources as a value per square footage utilized by a particular cell or value stream. This methodology of factoring gives a true picture of cellular consumption to value-added throughput for each value stream company wide. Now you can easily focus improvement kaizen events where actual problems exist for faster calculated benefits and sustainability. |
| Lean Enterprise | An organization that is engaged in the endless pursuit of waste elimination in all of it’s’ activities. Lean Enterprise focuses on all aspects of a company’s system. Whereas Lean Manufacturing tends to focus on production activities, Lean Enterprises are diligently working to reduce waste in all of its many forms in every department and activity the organization engages in. Lean Enterprises reduce or eliminate paperwork, improve supply chain agreements, enhance hiring and training processes, provide employee development opportunities, and many other such activities. |
| Lean Manufacturing | Lean Manufacturing is an operational philosophy focused on eliminating all waste in the manufacturing process. It includes lean concepts like;
– zero inventory – batch to flow, cutting batch size – line balancing – zero wait time – pull instead of push production control systems – cutting actual process time. It can also be described as a manufacturing/production system best characterized as relentlessly eliminating waste from all of it’s’ activities and operations. Lean strives to produce products: On-Time, Using as few resources as possible, Better than competitors, Faster & Cheaper than competitors, etc. Lean Manufacturing is the “umbrella” under which many manufacturing improvement tools are housed. Some examples include: (a) SMED: Single Minute Exchange of DIE (b) TPM: Total Productive Maintenance (c) 5S: Visual Workplace or Visual Factory (d) Kanban: Work Signaling System (e) Two-Bin: Materials Replenishment system (f) Error & Mistake-Proofing: A perfect process tool (g) Level-Loading (Heijunka): For producing mixed quantities and styles of products, and others. Lean Manufacturing is now present throughout the world and has become a global standard or set of practices which virtually all companies must adopt in order to be competitive in a global economy. Beyond the “need” to compete globally Lean empowers and motivates employees to engage in the betterment of their respective companies. |
| Lean Metric | Lean metrics allow companies to measure evaluate and respond to their performance in a balanced way, without sacrificing the quality to meet quantity objectives, or increasing inventory levels to achieve machine efficiencies. The type of the lean metric depends on the organization and can be of following categories; Financial performance, behavioral performance and core process performance. |
| Lean Supply Chain | The process of extending your Lean Six-Sigma activities to your supply chain by partnering with suppliers to adopt one or more of the Lean Concepts or Tools. |
| Lean Thinking | This is a focus on eliminating all waste within the processes, including customer relations, product design, supplier networks, production management, sales and marketing. Its objective is to reduce human effort, inventory, cycle time and space required to produce customer-deliverable outputs. |
| Level-Loading | A Technique used to balance production throughput according to the needs of customers (Demand). Level-Loading is loading your production system according to the exact needs (+ or -) of your customers. Ideally it is based on the consumption of products customers are “pulling” from your system. Mixed-Level-Loading supports the same concept as Level-Loading which is to supply your customers with exactly what they need when they need it. However, “mixing” includes producing perhaps many different models of products in correct quantities and ratios to satisfy customer demand for a variety of products with shorter than average lead-times. Level and Mixed-Level Loading are advanced Lean methods and require a good deal of Lean implementation before they can be very successfully applied in “real world” plants. You must have the ability to switch from one product to another very quickly (usually automatically) to make this system work. Often you will need to modify tooling to accept a variety of parts so that no changeover process is required at all. Example: One particular client of ours is an automotive OEM plant. They are so good at Mixed-Level-Loading that on one small conveyor you will often see 2 or 3 Toyota parts followed by 1 or 2 GM parts, followed by 4 or 5 Nissan parts, followed by 2 Toyota parts, followed by 6 or 8 Ford parts, followed by… Finding the right mix to satisfy each customer in real-time is much easier than being able to produce that mix. Putting all the best Lean tools in place will enable you to eventually take your production to this pinnacle level of performance. |
| Line Graph | The simplest graph to prepare and use is the line graph. It shows the relationship of one measurement to another over a period of time. Often this graph is continually created as measurement occurs. This procedure may allow the line graph to serve as a basis for projecting future relationships of the variables being measured. |
| Manufacturing Execution Systems | A networked computing system used to automate production control and process automation through intercommunication between production scheduling, work scheduling and production throughput to bridge gaps that might appear between these functions. |
| Milestone Graph | Shows the goals or target to be achieved by depicting the projected schedule of the process. A primary purpose is to help organize projects and to coordinate activities. |
| Mind Maps | An unstructured cause-and-effect diagram. Also called mind-flow or Brain Webs. |
| Mistake Proofing | Any change to an operation that helps the operator reduce or eliminate mistakes. |
| Mura | Any process variation that is inconsistent or irregular. Mura is present when workload is out of balance or when workflow is inconsistent or not standard. |
| Muri | Any task that requires unreasonable stress or effort from personnel, material or equipment. For people this could represent a task that is too physical. For machinery this could be expecting a machine to do more than it is capable of or has been designed to do. |
| Muda | Anything that interrupts the flow of products and services through the value stream and out to the customer is designated Muda or waste |
| No-Value Added | Activities or actions taken that add no real value to the product or service making such activities or action a form of waste. This amounts to any process or event that does not make a product more like what a customer is willing to pay for. This is a very simple definition but has far reaching implications. Lean Manufacturing is almost completely about removing waste from manufacturing and processes. Waste is best defined as “any process that does not add value to a product.” To appreciate the definition of Non-Value Added (NVA), we need to revisit the concept of “VA” or “Value-Adding” which states that “Value-Adding” activities are “Any activity that makes a product more like what a customer is willing to pay for.” No customers want to pay for activities that do not “add value” to their products. The fact is all customers indirectly pay for Non-Value-Adding activities because suppliers build them into the sales price of everything they produce. |
| No-Value-Added Costs | These are the costs of doing activities that the customer would not want to pay for because it adds no direct value to him or her. It can be further divided into business-value-added, no-value-added, and bureaucracy costs. It also includes appraisal costs. |
| One Piece Flow | This is a concept where a single piece of work moves between work stations instead of a batch process. |
| Operating Expenses | The money required by the system to convert inventory into throughput. |
| Opportunities | It is anything within the product, process, service or system that could cause an error that would make the output less than ideal in the customer’s eyes. Opportunities are the things that must be right to satisfy the customer. They are not the number of things that could possibly go wrong within the process. For example, in typing a five-letter word, there are five opportunities for making an error that the customer would be dissatisfied with. |
| Organization Change Management | A methodology designed to lessen the stress and resistance of employees and management to individual critical changes. |
| Organizational Excellence | This methodology is made up of five key elements, called the Five Pillars, which must be managed simultaneously to continuously excel. The five pillars are:
– Process Management – Project Management – Change Management – Knowledge Management – Resource Management |
| Overall Equipment Effectiveness | Measures the availability, performance efficiency, and quality rate of equipment; it is especially important to calculate OEE for the constrained operations. The Combined Measurement of Equipment Availability, Performance Rate and Quality Rate: A key measurement in “Total Productive Maintenance” (TPM). Formula: Machine Availability X Performance Rate X Quality Rate where (a) Machine Availability: Is The Actual Time Left For Production After You Subtract All Planned Downtime; (b) Performance Rate: Is The Measure Of “How Well The Machine Was Running When It Was Running and (c) Quality Rate: Tells Us How Many Good Parts VS. Defective Parts A Machine Has Produced During The Time It Was Running. OEE is an essential measurement for determining the effectiveness of your equipment and beginning to understand where up-time improvements are possible |
| Overproduction | Measures the availability, performance efficiency, and quality rate of equipment; it is especially important to calculate OEE for the constrained operations. The Combined Measurement of Equipment Availability, Performance Rate and Quality Rate: A key measurement in “Total Productive Maintenance” (TPM). Formula: Machine Availability X Performance Rate X Quality Rate where (a) Machine Availability: Is The Actual Time Left For Production After You Subtract All Planned Downtime; (b) Performance Rate: Is The Measure Of “How Well The Machine Was Running When It Was Running and (c) Quality Rate: Tells Us How Many Good Parts VS. Defective Parts A Machine Has Produced During The Time It Was Running. OEE is an essential measurement for determining the effectiveness of your |
| Pareto Diagrams | A type of chart in which the bars are arranged in descending order from the left to the right. It is a way to highlight “the vital few” in contrast to “the trivial many.” |
| Perfection | Always optimizing value-added activities and eliminating waste. |
| Performance Goals | Quantifies the results that will be obtained if the business objectives are satisfactorily met. |
| Performance Improvement Plan (PIP) | A three-year plan designed to align the environment within an organization with a series of vision statements that drive different aspects of the organization’s behaviors. |
| Performance Plan | A contract between management and the employees that define the employees’ roles in accomplishing the tactics, and the budget limitations that the employees have placed upon them. |
| Performance Standard | Defines the acceptable error level of each individual in the organization.
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| PERT Charts | PERT stands for Program Evaluation Review Technique. This is a methodology that was developed by the U.S. Government in the 1950s. It is a project management tool used to schedule, organize and coordinate tasks within the project. It provides an effective way of determining interdependencies between activities and timing. It allows for the critical path through the project to be readily defined. |
| Pictorial graphs | A way to represent data using pictures. Pictograms are a type of pictorial graph in which a symbol is used to represent a specific quantity of the item being plotted. The pictogram is constructed and used like bar and column graphs. |
| Plan-Do-Check-Act | A structured approach for the improvement of services, products and/or processes developed by Walter Shewhart.
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| Plus Minus Interesting | An idea evaluation weapon that analyzes the idea or concept by making a list of positive (+) and negative (-) things related to the idea or concept. It also uses a third column, called “interesting” where random thoughts about the item being evaluated are recorded. A technique often used to evaluate a solution that may initially seem like a bad idea. |
| Point-of-use-Storage (POUS) | Locating materials, tools, all necessary accessories at the point of value adding activities. |
| Poka-Yoke | A mistake-proofing device or procedure to prevent a defect during order taking or manufacture. An order-taking example is a screen for order input developed from traditional ordering patterns that question orders falling outside the pattern. The suspect orders are then examined, often leading to the discovery of inputting errors or buying based on misinformation. A manufacturing example is a set of photocells in parts containers along an assembly line to prevent components from progressing to the next stage with missing parts. A poka-yoke is sometimes called a baka-yok. |
| Poor-Quality Cost
(PQC) |
This was an improvement on the quality cost system developed in the 1950s by Val Feigenbaum at General Electric. It extended the concept from direct quality cost to direct and indirect quality cost. It contains the following categories:
I. Direct Poor-Quality Cost A. Controllable Poor-Quality Cost 1. Preventive Cost 2. Appraisal Cost 3. No-Value Added Cost B. Resultant Poor-Quality Cost 1. Internal Error Cost 2. External Error Cost C. Equipment Poor-Quality Cost II. Indirect Poor-Quality Cost A. Customer Incurred Cost B. Customer Dissatisfaction Cost C. Loss of Reputation Cost D. Lost Opportunity Cost It is a methodology that defines and collects costs related to resources that are wasted as a result of the organization’s inability to do everything correct every time. It includes both direct and indirect costs. |
| Prevention Costs | These are all the costs expended to prevent errors from being made or, to say it another way, all the costs involved in helping the employee do the job right every time. |
| Preventive Action | This is action taken that will eliminate the possibility of errors occurring rather than reacting from errors that occurred. It is a long-term, risk-weighted action that prevents problems from occurring based on a detailed understanding of the output and/or the processes that are used to create it. It addresses inadequate conditions that may produce errors. |
| Process | A series of interrelated activities or tasks that take an input and provide an output. |
| Process Benchmarking | A systematic way to identify superior processes and practices that are adopted or adapted to a process in order to reduce cost, decrease cycle time, cut inventory and provide greater satisfaction to the internal and external customers. |
| Process Control | It is a way the process is designed and executed to maximize the cost effectiveness of the process. It includes process initiation, selection of the process steps, selection of alternative steps, integration of the individual activities into the total process, and the termination of the process. Too frequently, process control and process control charts are used interchangeably and they should not be. |
| Process Elements | These are the sub-units that make up a process. They are normally referred to as activities, and the sub-units to the activities are tasks. |
| Process Flow Animation | A process model that shows the movement of transactions within the process and how outside functions impacts the process’s performance. |
| Process Kaizen | Improvements made at an individual process or in a specific area. Sometimes called “point kaizen”. |
| Process Improvement Team | A group of employees assigned to improve a process. It is usually made up of employees from different departments.
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| Process Owner | The individual responsible for the process design and performance. They are responsible for the overall performance from the start of the process to the satisfaction of the customer with the delivered output. It is the responsibility of the process owner to ensure that sub optimization does not occur throughout the process as well as setting improvement performance goals for the process. |
| Process Performance Analysis | The collection of performance data (efficiency and effectiveness data) at the activities or task level of a flowchart that is used to calculate the performance of the total process. |
| Process Performance Matrix | This is the efficiency, effectiveness and adaptability measurements related to the process. Particular focus is paid to the effectiveness measurements because they need to reflect customer requirements. |
| Process Qualification | A systematic approach to evaluating a process to determine if it is ready to ship its output to an internal or external customer. |
| Process Redesign | A methodology used to streamline a current process with the objective of reducing cost and cycle time by 30 to 60% while improving output quality from 20 to 200%. |
| Process Reengineering | This is a radical methodology that challenges all the paradigms that the organization has imposed on the process. It is usually used when the present process is so obsolete or so bad that you don’t want to influence the new process in the design concept. Typically a process reengineering project takes six to nine months to complete and is used when cost and cycle time need to be reduced by more than 60%. |
| Process Route Table | Shows what machines and equipment are needed for processing a component or assembly. These tables aid in creating ordinary lines and grouping work pieces into work cells. |
| Process Simplication | A methodology that takes complex tasks, activities, and processes and bisects them to define less complex ways of accomplishing the defined results. |
| Process Simulation | A technique that pictorially processes resources, products, and services in a dynamic computer model. |
| Processing Time | The time a product is actually being worked on in a machine or work area. |
| Project Champion | This is the individual who makes sure that the project has the resources and cross-functional support that is needed to be successful. The project champion is the individual that is most accountable to the executive team for the overall results of the project. |
| Project Communications Management | A subset of project management than includes the processes required to ensure timely and appropriate generation, collection, dissemination, storage, and ultimate disposition of project information. |
| Project Cost Management | A subset of project management that includes the processes required to ensure that the project is completed within the approved budget. |
| Project Financial Benefit Analysis | This is an analysis that is conducted at least at each checkpoint in the process. It evaluates the potential savings compared to the cost of making the change. Early in the project both potential savings and cost are estimated. When the project has been implemented, actual project financial benefit analysis figures can be provided. |
| Project Human Resource Management | A subset of project management that includes the processes required to make the most effective use of the people involved with the project. |
| Project Integration Management | A subset of project management that includes the processes required to ensure that the various elements of the project are properly coordinated. |
| Project Management | The application of knowledge, skill, tools and techniques to project activities to meet or exceed stakeholders’ needs and expectations from the project. It includes the following:
– Project Integration Management – Project Scope Management – Project Time Management – Project Financial/Cost Management – Project Quality Management – Project Resource Management – Project Communication Management – Project Risk Management – Project Procurement Management – Project Organizational Change Management – Project Document/Configuration Management – Project Planning and Estimating Management This is a primary responsibility of the Master Black Belts, Black Belts, and Green Belts. |
| Project Quality Management
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A subset of project management that includes the processes required to ensure that the project will satisfy the needs for which it was undertaken. |
| Project Risk Management | A subset of project management that includes the processes concerned with identifying, analyzing, and responding to project risk. |
| Project Scope | This defines the boundaries within which the project will work and it helps prevent project creep. |
| Project Scope Management | A subset of project management that includes the processes required to ensure that the project includes all the work required, and only the work required, to complete the project successfully. |
| Project Selection Matrix | This is a matrix that analyzes the various improvement opportunities to define the ones that should be approved or continued. A number of factors need to be considered. Typical factors are:
– Impact on a customer – In line with the strategic objectives – Financial returns – Competitive advantage, etc. |
| Project Time Management | A subset of project management that includes the processes required to ensure timely completion of the project. |
| Pull | A system of cascading production and delivery instructions from downstream to upstream activities in which the upstream supplier waits until the downstream customer signals a need. A pull system means producing only what has been consumed by downstream activities or customers. |
| Pull System | This is a production control system that replaces parts and components only when the same part or component has been consumed. It is designed to eliminate in-process storage and is part of a just-in-time system. |
| Push System | In contrast to the pull system, product is pushed into a process, regardless of whether it is needed. The pushed product goes into inventory, and lacking a pull signal from the customer indicating that it has been bought; more of the same product could be overproduced and put in inventory. |
| Qualification | Acceptable performance of a complete process consisting of many operations that have already been individually certified. For a process to be qualified, each of the operations and all of the equipment used in the process must be certified. In addition, the process must have demonstrated that it can repeatedly produce high-quality products or services that meet specifications. |
| Qualitative Data | It is data related to counting the number of items and cannot be broken down into smaller intervals. It is count rather than measurement data. For example: the number of machines shipped in a specific time period. |
| Quality @ Source | Building Quality into value adding processes as they are completed. This is in contrast to trying to “inspect in quality”, that only catches mistakes after they have been made. An effective Quality @ Source campaign can minimize or eliminate much of the expense associated with traditional Quality Assurance and Control programs. |
| Quality Management | All activities of the overall management function that determine the quality policy, objectives, and responsibilities and implement them by means such as quality planning, quality control, quality assurance, and quality improvement within the QMS. (ISO 8402: ) |
| Quality Management System/ISO 9000 (QMS) | The organizational structure, procedures, processes, and resources required to determine the quality policy, objectives, planning, control, assurance and improvement that impact, directly or indirectly, the products or services provided by the organization. |
| Quality Manual | A document stating the quality policy and describing the QMS of an organization. (ISO 8402 ) |
| Quality Plan | A document setting out the specific quality practices, resources, and sequence of activities relevant to a particular product, project, or contract. (ISO 8402 ) |
| Quality System | The organizational structure, procedures, processes, and resources needed to implement quality management. (ISO 8402 ) |
| Quick Changover | The ability to change tooling and fixtures rapidly (usually minutes), so multiple products can be run on the same machine. Quick changeover is a technique to analyze and reduce resources needed for equipment setup, including exchange of tools and dies. Single Minute Exchange of Dies (SMED) is an approach to reduce output and quality losses due to changeovers. |
| Queue Time | The time a product spends in a line awaiting the next design, order processing, or fabrication step. |
| Rapid Prototyping | A process that avoids creating conventional tooling thereby limiting investment expense while new parts or products are tested for feasibility of manufacture. This is a very exciting area for improvements in manufacturing generally. Some Rapid Prototyping software and devices are maturing to the point where it is starting to become possible in the near future that we will be telling computers to “make a baseball” or “make a fuel injection system.” Many experts expect Rapid Prototyping to evolve into Rapid Creation, and the face of many industries will be changing significantly as this technology develops. |
| Reliability Management System | Designing, analyzing and controlling the design and manufacturing processes so that there is a high probability of an item performing its function under stated conditions for a specific period of time. |
| Resultant Poor-Quality Costs | These are the costs that result from errors. These costs are called resultant costs because they are directly related to management decisions made in the Controllable Poor-Quality Costs category. It is divided into two subcategories: internal error costs and external error costs. |
| Rewards and Recognition | This is action taken to reinforce desired behavior patterns or exceptional accomplishments. Categories of rewards and recognition are:
– Financial compensation – Monetary awards – Group/team rewards – Public personal recognition – Private personal recognition – Peer rewards – Customer rewards – Organizational awards |
| Risk Analysis | This is an evaluation of the possibility of suffering harm or loss. A measure of uncertainty. An uncertain event or condition that, if it occurred, might have a positive or negative effect on the organization or the project. |
| Risk Assessment | Performing a quantitative analysis of the risks and conditions to prioritize their effects on the project objectives or the organization’s performance. |
| Robust Process | A robust process operates at the six sigma level, producing very few defects even when the inputs to the process vary. They have a very high, short-term Z value and a small Z shift value. The critical element in a robust process is the u element. |
| Robustness | The characteristics of a process output and process design that make it insensitive to the variation in inputs. |
| Root Cause Analysis | The process of identifying the various causes affecting a particular problem, process or issue and determining the real reasons that caused the condition. |
| Run Charts | A graphic display of data, used to assess the stability of a process over time, or over a sequence of events (such as the number of batches produced). The Run Chart run chart is the simplest form of a Control Chart control chart. |
| Sensei | An outside master or teacher that assists in implementing lean practices. |
| Seven Wastes | Taiichi Ohno¹s original catalog of the wastes commonly found in physical production. These are overproduction ahead of demand, waiting for the next processing stop, unnecessary transport of materials, over-processing of parts due to poor tool and product design, inventories more than the absolute minimum, unnecessary movement by employees during the course of their work, and production of defective parts. |
| SIPOC | This stands for suppliers, inputs, processes, output, and customers. It is used to help you ensure that you remember all the factors when mapping a process. |
| SMED | This stands for Single Minute Exchange of Die. It is one of the lean tools and it is a key part of just-in-time programs. It is a methodology used to minimize the amount of time of changing a process over to produce another output. |
| SCAMPER | This is a check list and acronyms made up of the following:
S Substitute C Combine A Adapt/Adopt M Modify/Magnify/Minify P Put to other Uses E Eliminate R Reverse/Rearrange This technique is used to generate ideas when each of these questions is asked. It is a technique generated by Michael Michalko. |
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| Shewhart Cycle (PDCA) | The same as Plan-Do-Check-Act. |
| Single Piece Flow | A situation in which products proceed, one complete product at a time, through various operations in design, order taking, and production, without interruptions, backflows, or scrap. |
| Sigma | This is a Greek letter and statisticians use it to refer to the standard deviation of a population. Sigma and standard deviation are interchangeable. They are used as a scaling factor to convert upper and lower specified limits to Z. |
| Simple Language | This is a way to evaluate the complexity of writing. It indicates the grade level that a person who is reading the document should have reached in order to understand the document. Simple language produces documents that can be read at two grade levels lower than the lowest educational level of the person who will be using the documents. |
| Simplification Approaches | These are a series of techniques that focus on simplifying the way things are done. It could include things like the following:
– combining similar activities – reducing amount of handling – eliminating unused data – clarifying forms – using simple English – eliminating non-value-added activities – evaluating present IT activities to determine if they are necessary – evaluating present activities to determine if IT approaches would simplify the total operations |
| Simulation Modeling | Using computer programs to mimic the item (activity process or system) under study in order to predict how it will perform or to control how it is performing. |
| Six Sigma | Six sigma is a rigid, systematic methodology that utilizes information (managing by fact) and statistical analysis to measure and improve an organization’s performance by identifying and preventing errors. It can be thought of in three parts:
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| Six Sigma Matrix | This is divided into four categories. They are:
– Measuring customer opinion – Determining customer critical-to-quality factors – Measuring product outcome – Correlate product outcomes to critical-to-quality factors (Measure processes with a matrix that correlates to the organization’s economics.) |
| Six-Sigma Program | A program designed to reduce error rates to a maximum of 3.44 errors per million units, developed by Motorola in the late 1980s. |
| Six-Step Error-Prevention Cycle | A process to prevent problems from occurring rather than fix them afterwards. |
| Six-Step Problem-Solving Cycle | A basic procedure for understanding a problem, correcting the problem, and analyzing the results.
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| Six-Step Solution-Identification Cycle | A procedure for defining how to solve a problem or take advantage of an opportunity.
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| Soft Consensus | When some members would prefer a different solution but are willing to support the decision of the team. |
| Soft Savings | This is sometimes also referred to as intangible savings. It is the benefit you get from a change that is not directly reflected in the accounting system. It includes things like reduced cycle time, cost avoidance, improved employee morale, lost-profit avoidance, and higher levels of customer satisfaction. |
| Spider Diagrams/Radar Charts | Used to show or compare one or more sets of data to each other. Often used to indicate the status quo (current state) against the vision (future state). |
| Stakeholder Analysis Plan | A system to identify “key stakeholders” or individuals that have a stake in the overall success/failure of the process. |
| Standard Deviation | An estimate of the spread (dispersion) of the total population based upon a sample of the population. Sigma (s) is the Greek letter used to designate the estimated standard deviation. |
| Standard Work | Repeating work activities using the same processes every time. Standardized Work will generally include testing work processes again and again to prove out the “Current best ways” of completing tasks. The “current best ways” is an important concept as one of the basic tenants of Standardized Work is that you are always looking for better ways to do work. Normally when we help companies implement Standardized Work we use photos, simple diagrams, and plain text to make work instructions and present them in a very clear manner. It is difficult to get consistent quality and timely output unless you standardize work processes and write “Standardized Work Instructions” that must be followed. Most workers like to do things “their own way,” and that is fine as long as their way is the standardized way. If workers wish to challenge the “Standardized Work Instructions” that is fine and even appreciated. The key is that everyone should be completing whatever task in the ‘Current Best Way.’ |
| Storyboard | A series of pictures and accompanying narrative that is used to define how something is done or what is going on related to a problem or situation. |
| Strategy | The approach that will be used to meet the performance goals. |
| Structural Roadblocks | These are obstacles that must be overcome for a process or an organization to transform from one state into another. |
| Sub-Optimization | A condition where gains made in one activity are offset by losses in another activity or activities. |
| Supplier Controls | These are the preventive measures that are put into place to minimize the possibility of suppliers providing unacceptable product. They include things like supplier qualification, requirements placed on the supplier to be ISO 9000 certified, source inspection, receiving inspection, etc. |
| Supply Chain Management | This is the flow of items from raw materials to accepted products at the customer location. It is a methodology used to reduce cost, lead times, and inventory, while increasing customer satisfaction. |
| Surveys | A systematic way to collect information about a specific subject by interviewing people. Often, the interview takes the form of a series of questions that are presented to a target audience either in written or verbal form. |
| Sustaining Sponsor | Individual/group who has the political, logistical and economic proximity to the individuals. |
| SWOT Analysis | This stands for Strengths, Weaknesses, Opportunities, and Threat analysis. It is used to help match the organization’s resources and capabilities to the competitive environment that exists in their market segment. It is often used as part of the strategic planning process. |
| Synchronous Flow Manufacturing (SFM) | SFM is a pull manufacturing system like Kanban but it offers some apparent advantages over Kanban. In a Kanban system, each downstream operation pulls work from the next one upstream. In SFM, the only information transfer is between the capacity-constraining resource (CCR) and production starts. The CCR pulls work into the factory in the form of production starts. It is always desirable to keep a buffer of work in the line upstream of the CCR because a shortage at the CCR means an irrecoverable loss of production time. |
| System | The organizational structure, responsibilities, procedures, and resources needed to conduct a major function within an organization or to support a common business need. |
| System Kaizen | Improvement aimed at an entire value stream. |
| Systematic Design | This is a very structured step-by-step approach to designing that was developed in Germany. It defines four main phases of the design process. They are:
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| Tactic | How the strategies will be implemented.
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| Takt Time | Takt time is the rate that a completed item leaves the last step in the process. It should be equivalent to the rate at which customers, internal or external, require the output. It drives the pull system as it eliminates the need for in-process stock. The process should be designed so that each step in the process is operating at the same takt time as the sales process. This is the ideal situation that keeps the process in continuous flow without buildup within the process or between processes. |
| Team | A team is a small group of people who work together that realize their interdependencies and understand that both personal and team goals are best accomplished with mutual support. |
| Team Charter | It is preferable that the team charter is defined by the six sigma leadership team. It is the major contribution they can make by providing clear direction and expectations. The team charter does not map the route for the project but does provide the boundaries and destination. It includes project objectives, project process boundaries, limitations, key deliverables, outside resources and indicators/targets. |
| Team Management | It is the coordination and facilitation of the activities that go on within the team to ensure the effectiveness and efficiency of the team are optimized and the desired results are accomplished on schedule within cost. |
| Theory of Constraints (TOC) | There is one point in every that limits the flow through the process. The Theory of Constraints is used to identify these bottlenecks and eliminate them. This is a set of tools that examines the entire system to define continuous improvement opportunities. It consists of a number of tools. For example:
– Transition Tree – Prerequisite Tree – Current Reality Tree – Conflict Resolution Diagram – Future Reality Tree |
| Throughput Time | The time required for a product to proceed from concept to launch, order to delivery, or raw materials into the hands of the customer. This includes both processing and queue time. |
| Throughput Yield (TPY) | This is the yield that comes out of the end of a process after any errors that are detected have been scrapped or reworked and reentered into the process. Effective rework procedures can often increase first-time yield from 10% to a throughput yield of 100%. |
| Total Cost Management | A comprehensive management philosophy for proactively managing an organization’s total resources (material, capital, and human resources) and the activities that consume those resources. |
| Total Productive Maintenance (TPM) | This is a methodology used to keep the equipment within the organization at peak operating efficiency, thereby eliminating equipment downtime. |
| Total Productivity Management | A methodology designed to direct the organization’s efforts at improving productivity without decreasing quality. It is designed to eliminate waste by involving employees, effective use of information technology, and automation. |
| Total Quality Management
(TQM) |
A methodology designed to focus an organization’s efforts on improving quality of internal and external products and services. ISO 8402 defines it as: A management approach of an organization, centered on quality, based on the participation of all its members and aiming at long-term success through customer satisfaction and benefits to the members of the organization and to society. TQM is a conceptual, philosophical and structured group of methodologies that require management and human resource commitment to the embodiment of a philosophy where all of the management, employees, processes, practices and systems throughout the organization understand their customers, both internal and external, and provide them with organizational performance that fulfills or exceeds the customers’ expectations. It is part of the evolution from quality control to statistical quality control to total quality control and it embodies all the criteria now included in all of the international, national and local quality award systems.
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| Toyota Production System | The Toyota production system is a technology of comprehensive production management. The basic idea of this system is to maintain a continuous flow of products in factories in order to flexibly adapt to demand changes. The realization of such production flow is called Just-in-time production, which means producing only necessary units in a necessary quantity at a necessary time. As a result, the excess inventories and the excess work force will be naturally diminished, thereby achieving the purposes of increased productivity and cost reduction. |
| Tree Diagrams | Systematic approaches that help the user think about each phase or aspect of solving a problem, reaching a target or achieving a goal. |
| Trial | An observation made with all of the variables set at pre-designed levels and held constant during the duration of the observation. |
| Tribal Knowledge | This is any unwritten information that is not commonly known by others throughout the organization. It is part of a total organization’s knowledge assets and one that is frequently lost as individuals change jobs or leaves the organization. Unlike other forms of intellectual assets, tribal knowledge cannot be converted into company property unless it is transformed into a hard knowledge base. |
| TRIZ | This is a methodology that was developed in Russia and stands for “theory of innovative problem-solving.” It was originated by Henrich Alashuller in 1946. It is effective at identifying low-cost improvement solutions during the define or identify phase. It is helpful in defining root cause of defects. This approach expands on systems engineering methodologies and provides a powerful system management method for problem definition and failure analysis. It is an effective approach to generating innovative ideas and solutions to problems. TRIZ is a Russian acronym. |
| Types of Data | There are basically two major groupings of data. They are:
– Attributes Data: The kind of data that is counted, not measured. It is collected when all you need to know is yes or no, go or no-go, accept or reject. – Variables Data: Variables data is used to provide a much more accurate measurement than attributes data provides. It involves collecting numeric values that quantify a measurement and therefore requires a smaller sample to make a decision. |
| Types of Teams | There are many different types of teams that are identified by different properties related to the team organization and objectives. Typical teams are:
– Department Improvement Teams, focusing on individual area improvement opportunities – Quality Circles, voluntary teams that form themselves – Process Improvement Teams, typically working across functions, focusing on optimizing a total process typified by process reengineering and process redesign, and – Task Forces, typified by an emergency that occurs within an organization – Natural Work Teams, made up of individuals who are brought together to perform ongoing activities. |
| Value | A capability provided to a customer at the right time at an appropriate price, as defined in each case by the customer. |
| Value Chain | Activities outside of your organization that add value to your final product, such as the value adding activities of your suppliers. |
| Value Stream | This is all of the steps/activities (both value-added, business-value-added, and non-value-added) in a process that the customer is willing to pay for. |
| Value-Added Analysis (VA) | A procedure for analyzing every activity within a process, classifying its cost as value-added, business value-added, and no-value-added; and then taking positive action to eliminate the no-value-added cost and minimize the business value-added. |
| Value-Added to Non-Value-Added Lead Time Ratio | Provides insight on how many value added activities are performed compared to non value added activities, using time as a unit of measure. |
| Value Stream Costing | Value Stream Costing methodology simplifies the accounting process to give everyone real information in a basic understandable format. By isolating all fixed costs along with direct labor we can easily apply manufacturing resources as a value per square footage utilized by a particular cell or value stream. This methodology of factoring gives a true picture of cellular consumption to value-added throughput for each value stream company wide. Now you can easily focus improvement kaizen events where actual problems exist for faster calculated benefits and sustainability. |
| Value-Stream Mapping | This tool is used to help you understand the flow of materials and information as an item makes its way through the value stream. A value-stream map takes into account not only the item but also the management and information systems that support the basic item. This is helpful in working with cycle-time reduction problems and is primarily used as part of the lean tool kit. |
| Variables Data | The kind of data that is always measured in units, such as inches, feet, volts, amps, ohms, centimeters, etc. Measured data gives you detailed knowledge of the system and allows for small, frequent samples to be taken. This is data that is equivalent to quantitative data. There are two types of variables data: discrete (count-type data) and continuous data. |
| Variation | This is a measure of the changes in the output from the process over a period of time. It is typically measured as the average spread of the data around the mean and is sometimes called noise. |
| Vision | A description of the desired future state of an organization, process, team or activity. |
| Visual Management (Controls) | The placement in plain view of all tools, parts, production activities, and indicators of production system performance so everyone involved can understand the status of the system at a glance. Known as a set of techniques that makes operation standards visible so that workers can follow them more easily. These techniques expose waste so that it can be prevented and eliminated. |
| Vision Statement | A group of words that paints a clear picture of the desired business environment 5 years in the future. A visions statement should be between 2 to 4 sentences. |
| Visual Factory/Visual Office | This is a system of signs, information displays, layouts, material storage, and equipment storage. It uses color coding and error-proofing devices. The five Ss are part of visual controls and the visual office. Typical tools used in the visual office or control center would be a continuously updated electronic sign indicating the number of clients that are waiting for their phone call to be answered, or the length of time it takes to respond to a phone inquiry. |
| Vital Few | This is the 20% of the independent variables that contribute to 80% of the total variation. |
| Voice of the Business (VOB) | This describes the stated and unstated needs and requirements of the organization and its stakeholders. |
| Voice of the Customer
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The customer’s expression of their requirements, in their own terms. It describes the stated and unstated needs and requirements of the external customer. |
| Voice of the Employee (VOE) | This is the term used to describe the stated and unstated needs and requirements of the employees within your organization. |
| Voice of the Process
(VOP) |
This is the term used to describe what the process is telling you about what it is capable of achieving. |
| Waste (a.k.a. Muda) | Anything that uses resources, but does not add real value to the product or service. Any activity which utilizes equipment, materials, parts, space, employee time or other corporate resource beyond the minimum amount required for value-added operations to insure manufacturability |
| Waste Identification | The ability to “see” waste in your Organization. This encompases readily identifying the 8 waste categories in all your processes. |
| Waste Elimination | The ability to apply Lean Concepts and Tools to eliminate identified wastes. |
| Work Breakdown Structure (WBS) | This is a Gantt chart used in project management to monitor and plan the activities related to doing the project as well as defining their interrelationships and their present status. |
| Work Flow Monitoring | An online computer program that is used to track individual transactions as they move through the process to minimize process variation. |
| Work-in-Process ( WIP) | Product or inventory in various stages of completion throughout the plant, from raw material to completed product. |
| Work Standards | When work standards are practiced, everyone in the organization is committed to performing the work in the same best way. Work standards include documentation methods and developing engineering standards to set expectation and measurement matrix. They provide job aids and training to the employees that effectively communicate the best ways to perform an activity and sets the minimum performance standard for the trained employee. |
| World-Class Operations Benchmarking | A form of external benchmarking that extends the benchmarking approach outside the organization’s direct competition to involve dissimilar industries. |
| Xs | In Six Sigma Xs are all the inputs that are required to produce the output Y. It includes the materials, procedures, process, and suppliers. |
| Zero Defects | This was a complete system directed at eliminating all defects from a product. It was originated by Phil Crosby on a military contract and spread throughout the world. It sets a higher standard for performance than six sigma by 3.4 defects per million opportunities. It focused on perfection, which is impossible to reach but should be our objective. |