Episode_12-Q_A_Chuck-Ready

Liz Crescenti and Marco Bonilla host a podcast called Lean into Excellence. They answer audience questions about adapting Six Sigma methodologies to different industries and measuring the financial impact of Six Sigma projects. They also discuss the importance of understanding the big why and the return on investment. They give examples of breakthrough improvements achieved through Design for Six Sigma principles. The key metrics for demonstrating ROI are quality, cost, and delivery. It's important to invest time and effort upfront to avoid costly do-overs later. Welcome to Lean into Excellence, a Workstream Consulting Podcast. I'm Liz Crescenti. And I'm Marco Bonilla. And we will be your hosts as we embark on our continuous improvement journey. Welcome back to another episode of Lean into Excellence. I'm Liz Crescenti. And I'm Marco Bonilla. And today we are going to do a Q&A like we had done before in the past. We have some really great questions that our audience has written in. And in a little turn of events, we have Marco, who's going to be helping out answering these questions. But we also have Chuck Gillis, who is the founder and manager and director of Workstream Consulting. So we are very excited to have him on the show today. Welcome to our podcast, Chuck. Good morning. Nice to be here. So we will just jump right in. And we have our first question from Jay in Fort Worth. So Jay wrote in. He said, how do you adapt Six Sigma methodologies to fit the unique needs of different industries, such as healthcare, manufacturing, finance, et cetera? I'll take this one to start with. When I first started the business, we were focused very much in the manufacturing aspects of things. But when you have people inquiring from different industries, you have to be able to figure out what's the product that they make. Because essentially they're manufacturing something. Whether it's healthcare, finance, medical device, they all have an output. And that output can be measured and tracked. In healthcare, you're talking about moving patients. All right? When you're talking about a waiting room full of people and they're capturing that, there's a metric called left not seen. That's people that actually got frustrated and miraculously cured themselves and left the emergency room because they couldn't wait any longer. They're like, it's not that bad. I can Google this when I get home. In finance, there's multiple metrics that people measure. And those are all related. They're outputs that can be related to input Xs. Like for one is day sales outstanding. And for a business, you want to get that down as low as possible because that all affects cash. So you can peel into every single one of these and break them down into what we in the Six Sigma world call Y is a function of X. So whether it's patients, whether it's finances, or whether it's we've even worked with pharmaceutical companies, the same thing. You just drill it down and figure out what are the Xs that are driving the Y that you're interested in understanding. And Chuck, just to clarify because, again, we always speak in product because it's tangible. But this is not just for products. It's for services, too. It's for processes. And most of the things we do isn't really focused on the product. It's really on the process of producing the product or the process producing the service. So it's really product, service, or processes, right, as a whole if you're looking over an umbrella. Yep. All right. Our next question comes from Mike in Phoenix. Mike wrote, how do you measure the financial impact of Six Sigma projects and what metrics are most important for demonstrating ROI? Yeah, I think this is a great question, Chuck. And I think you'll agree that anyone who puts any time or effort into these frameworks or these training methodologies always wants to know what's in it for us, right? What is it we're going to gain from this? Is it money? Is it time? Is it resources? What do you think, Chuck? Well, at the end of the day, it all comes down to bang for the buck. What are we getting? More product out? More satisfied customers? Fewer complaints? Fewer rejections? I mean, all of these efforts can be tied into reducing something or increasing something else. It's essential to be able to quantify your efforts. What did we do? What did it cost us? Where were we? That's why it's very important to get a baseline at the beginning so you know exactly where you were when you started the project. When we're working with Greenbelts for the first time, one of the things I say to them is, how many times have you done a home improvement effort? And you've got all sorts of wonderful pictures of how it looks now. And a lot of times we forget to take the pictures of what it looked like in the beginning so that you really can't gauge the dramatic effect. Yeah, the same thing holds true for Lean Six Sigma projects. You want to be able to say, the baseline was here. It's now there, and it's not an aberration. We've been doing it like this for the last three months. And you really got to understand what moves the needle too, right, Chuck? Because you can't just go after any project just because it seems like a fun thing to do. You really understand the big why. You mentioned customer satisfaction, right? Sometimes it's profit. Sometimes it's generating future revenue, right, because you're building relationships with clients. So it's really important to understand. But the return on effort or return on investment is important because we're there to improve something. It's not just change for the sake of change, right? Like you said, you need a baseline, and you need to know where you're going and what that step function is. And that step function is derived by knowing what are the right Xs to manipulate inside the process. Do we have to change out equipment sets? Are we at the limitations of the process given the current tooling? You know, there's a lot of things to look at. And quite often we'll see people who say, oh, we'll just buy another piece of equipment. And there's no sense in buying another piece of equipment if you're not using the equipment you have today. Efficiently. That's the best efficiency. Efficiently and effectively, absolutely. Or the other thing we'll hear is, that's okay, we'll just automate the process. Just like that. You automate the process. The magic wand. The process isn't good. It allows you to make more bad stuff faster. Yeah. Or another one that I've heard in my career is, that's all right, we'll outsource it. You know, and outsourcing isn't always the issue, isn't always the answer either, because if we've got a poorly defined process with poor documentation and not well understood, and we're going to ask somebody else to do something that we've been doing poorly, it's not going to get better overnight. Exactly. And just to add to that, and just kind of give you like an offshoot answer to our original question, you can't just implement a Lean Six Sigma project and not change some of the culture around it. So, you know, upper management, so they say, we're going to do a project and just throw it over the fence and hope that whoever's running the show is going to fix whatever you're hoping is going to get done without management support. That's not going to happen, right? We've seen that happen a million times. Hopes and dreams doesn't bring it home. Exactly. It takes blood, sweat, and tears. Right. And speaking from 30-plus years of doing this stuff, you know, it requires effort. It requires, you know, staying late. It requires coming in on second shift. It requires becoming a part of the process itself. Yeah. And it requires good leadership, right, because people doing the work don't necessarily can get to the answer without some intervention or assistance, right, from leadership. Well, you know, we always talk about the role of a champion. And the champion is there to allow the belt and the team the opportunity to break down barriers that are preventing them from getting to that next level of performance. So I guess to loop it back around to the actual question, what are most important metrics that represent ROI in your view, Chuck? Which ones have made the biggest impact? For me, it's always been the big three, quality, cost, and delivery. Okay? Quality because the customer sees it. Cost because the financial community sees it. And delivery ties it back into the customer once again. Yeah, the operations, right, on-time delivery. OTD. Right. Got to have it. On time and in full. Right. If I have an order for 100 and you deliver me 75, I'm still short. Well, it's worse than that. If you deliver 100 and I have to return 25, right? Yeah. Right? You know, it's the three-legged stool. Absolutely. You have to be able to do all three well. All right. Our next question comes from Julie in Manchester. Julie wrote, can you share an example of a breakthrough improvement you've achieved using Design for Six Sigma principles? I'll start on that one, Marco. A number of years ago we were engaged by a medical device company that was trying to develop a robust, lean Design for Six Sigma program internally. The motivation behind that was they would go through product launch in the field and all of a sudden they'd realize, oh, we didn't think about that. So they have to stop using it in the field. They had to bring the team that had already been moved on to their next projects back in to do all of the requalification and development work to submit the next FDA submission, which was, oh, it's only $3,000. That was the only cost they were capturing. They weren't capturing the cost of all of the efforts necessary to go in and prove out the enhancements to the device. The other aspect of that, too, was you had people that were on that launch team that were freed up and moved on to the next product in the development cycle. Just when I thought I was out, they pulled me back in again. They'd be pulled back in to work on the resubmission package, which jeopardized the timeline of the next product in the cycle. So it's a vicious circle of not taking the time up front to get it done right and having to do a do-over. There's never enough time to do it right at the start, but there's always plenty of time, money and effort available at the end. People are reluctant sometimes to spend the money on the up front side. I'll tell you right now, a lot of the work that we do today is because we don't do a very good job. I don't care what industry it is on the up front side, and we are in the manufacturing world trying to make things work. And the irony is we have a lot of tools, plenty of tools for the up front design of a product and service. We just don't leverage it. I'm not saying we don't leverage it, but companies don't leverage that concept. Exactly, right? So in your case, the issues of things that we didn't think about once the product was out in the field would have been addressed if we did really good voice to the customer, right? Voice to the customer and a great DFMEA, design failure modes and effects analysis. Exactly. It's breaking it down and understanding the simplest elements. It's all risk mitigation so you don't have to do this on the other side. When they looked at it, it was, oh, it's only a $3,000 charge. But when you start to pull that thread back, it's a ton more money than the other thing in the product in your timeline. Time, effort, resources. I can tell you as a former rep in the device world, if I had a product that I had spent so long trying to get in the hands of my physician to use and then had to go back and say, it's not at the point where we can really use this, it's going to really affect some relationships. And then you could certainly lose trust in customers moving forward. Liz, it's actually worse than that, right? Because what Trex talked about is a delayed reaction to the quality that was not designed to the product, right? So if you have field fails, it doesn't mean they're going to fail right away. They might take a month, a couple months to fail, depending on what it is, right? Yeah. I don't know that that's happening, right, from your point of view, Liz. The other thing, thinking of it this way, if you're a dual-source supplier, right, you're one of two, what do you think is going to happen once the customer realizes that your product is having quality issues and your competitor, the other source, is not? There's an awful lot that's to be said for brand reputation. Absolutely. I've mentioned that multiple times in other podcasts. Reputation is everything, right? Absolutely. If I was the competitive rep, I would be salivating over something like that. Oh, you'd be capitalizing on it. Absolutely. So it's a serious issue that we don't design quality as much as we should. Yeah. It's not that people do it on purpose, right? Every designer tries to do the best they can. Absolutely. But they're not using the proper tools to really maximize that quality into a product or process. Everybody's worried about where they should be on the timeline. And sometimes they'll short the process in order to get there. Yeah. Yeah, and sometimes you design great products, right? The yield's not the problem, it's the process. You didn't design the process to maximize the efficiency or effectiveness of getting that product to the customer. Yep, absolutely. And we say it all the time. It's also shifting that reactive mindset to proactive. Proactive. Absolutely. No one wins in the end when you're constantly having to chase after it. Technically, you're paying for the product twice, right? Yes. I mean, that's the customer point of view from the internal customer, the company. Absolutely. You're going through the process a second time. When you budgeted that process or that product, it had X cost. Right. Now it's X plus. Exactly. So what you've done is you've cut into your profit. You've cut your margin. Yeah, because you can't raise the price on the product. No. Right? You've done enough. You've already established the price in the market. All right. Our next question comes from Jack in Austin. He wrote, how do you sustain the gains from a Six Sigma project in the long term, especially in dynamic and fast-paced environments? All right. I'm going to fall back on a topic that was near and dear to one of our podcasters, Herb Robbins, and that's control plans. Having viable, robust control plans is essential to sustaining any gains. The last piece in the dynamic puzzle, D-M-A-I-N-C, is C for control. And if we don't do a good job on controls, you're going back and you're solving the same problem again two years from now. Having a good, robust control plan makes sure that whether Marco's there or Chuck's there or Tom's there, that task is going to be performed the same way every time. Whether it's lean or Six Sigma, you have to have the checks and balances in place to make sure that we don't backslide. In the news recently, there's been an aircraft manufacturer that was always noted for being probably the best in the business when it came to lean activities. And it surprises the hell out of me because I have always used them as a benchmark when I'm speaking when it comes about lean. And having the proper controls to make sure the right checks are there didn't happen. When doors come off aircrafts, something didn't happen. And the traveling public does not deserve that. We work with people in the automotive industry, we work with people in the aerospace and defense industry, and everyone expects things to work right the first time. Whether it's an airbag detonator or a piece of missile hardware, you're counting on that to do its job. Because if it doesn't do its job, people die. And just to add to that, Chuck, the control part, people think you place a control and that's it. It becomes static for the rest. You have to have kind of two things. You need to have a process on Earth, right, that was part of the control process or of the improvement process. So if someone has ownership, it's just not put in place and left alone forever, right? Things change, things drift. The control might be fine, but the process might be changing over time, right? So you need people looking at this. It's not just leave it in place and walk away, because that's when things go haywire, right? It's not the Ron Popeil said it and forget it. Exactly, exactly. So you need someone who owns it that says, you know what, we're going to revisit this every three months, every six months. We don't have to do a lot. If everything's going well, you just want to make sure everything's where you think it should be. But you've got to remember that we naturally expect there to be one and a half standard deviations of variability in the process. And that is going to manifest itself all the time. Right. But you're going to have variability from suppliers. You're going to have variability from people. There's a whole host of things that affect the output of the process. So having a robust control plan that looks at that on a regular basis to accommodate the variability in the process is essential. Yeah. It's possible, and we've run into this, Chuck, that you place controls in thinking that you've accounted for every variable for that big why. And, of course, it's never 100%. So you've got to keep that in mind, and that's why we want to keep an eye on this. The other thing is the control is not the same as the specifications, right? We're not talking about specifications of the product. Our controls are everything, all the Xs along the way that influence, potentially affect. Hopefully, we've done enough analysis that we know what things go into that why. Most of them, again, we don't cover 100%. And we wrap around some controls around those to keep that big why in check, some plus minus, right? I had a product that I was working on one time that was going to a Japanese customer. And they were extremely critical in the cosmetics of the product. We had a single source supplier that was doing a great job for us. The product was pristine. But what was happening was the demand for this product was increasing tenfold at a time. In order for them to meet the demands, they made a process change that they said, oh, it won't affect anything. Well, it affected me. I was unable to make deliveries because the product quality from a visual perspective on the customer's end was unacceptable. So I found myself going to a little spot in the middle of the U.S. quite frequently and doing process walks. And we walked through the process and identified the fact that a key parameter for them was the firing process. And they went from using a kiln, which is a much more stable environment, which ramps up, holds, and then cools down. They went to a different process, which was faster. They could move more product through, but it was very volatile to the device at the time, causing cosmetic defects. But it took a few trips and understanding what was going on to say, hey, something's wrong here. And our control plan then became we've got to keep an eye on this particular aspect of the product because it didn't affect the performance. But the customer did not like the appearance. So it was green eggs, right? Check. Nothing's wrong with the eggs. They were just green, right? They were just green. Right, right. But you know what? Sometimes the visual aspect represents the brand, right, as we know. Yeah. So especially on the outside, if it's the visual package of the outside, it's really important to businesses. It was having a finish as smooth as glass to having a finish that looked like beach sand. Oh, I see. I understand. It was very grainy as opposed to smooth. It was still fully functional, but the cosmetics weren't there. I understand. I understand. Yeah. All right. We are coming to our last question. We have Alex in D.C. Alex wrote, what are the biggest challenges you face when training and certifying Six Sigma Black Belts and Master Black Belts, and how do you overcome them? So I think this is, all right, we're going to go through some opinion and some facts. Some of the challenges we have when we train Black Belts and Master Black Belts is getting them over the hump, understanding that they are in the leadership position, right? So as they went from Green Belt to Black Belt, they went from individual contributor to actually overseeing other people's projects, right? So I think some of the fear of some students is the fact that they don't have, they think they don't have their personalities or they're too introverted. You need to get over the fear factor because now you're being in a position that you're going to lead not only your own projects, but you're going to guide other students through their projects. Chuck, what do you think? What other factors? Well, I'm going to reflect back on my own training that goes back a good number of years ago. I was invited as a vendor to participate in Black Belt training, compliments of Allied Signal. And it was the typical Black Belt training, one week a month for four months. And at the conclusion of my training, I came back to the business I was in and I had a sit down with my boss. And my boss said to me, this is good for you because I see a difference in you. Now you've got three jobs. I says, okay, Joe, I can understand two. One, I'm your product manager. Two, I'm your Black Belt. I says, I'm at a loss on the third. He goes, you've got to be a missionary. You've got to get other people to think the way that you think. And that's kind of what we're trying to do is reengineer the thought process for a lot of people to kind of become trainers, teachers. I mean, mentors. It's all part of developing the culture to think that we act based upon signals from the process. We use data to make these decisions. We don't arbitrarily change something because I have to get it out by 5 o'clock. There's a thought process that goes involved in here. The other aspect of it, too, is developing the mentoring skills. So you're not going to make somebody a Black Belt, but you're certainly going to help them understand what it's like to collect process data. How you can analyze that process data. It's how to determine whether you had a good day or a bad day. Whether it's a simple thing of tracking the amount of uptime on a piece of equipment or tracking the throughput. I had people that worked for me that when a piece of equipment went down and they were called in to tech pool for service, they were saying, you better get somebody down here because it's costing me $3,000 an hour that this piece of equipment is down. But they had been able to break down the process to the point where knowing what each unit cost going through that equipment in an hour. Now, that's the type of learning that you need to get people to understand. The biggest barriers I see sometimes, though, is people look upon this as training for training's sake. They don't have the heart. Even when we talk about developing Master Black Belt candidates, they have to have the heart. It's a commitment. It's not just another build on your resume. This is the way you present yourself to an organization. And my own training took me through Black Belt training to managing a group of Black Belts to going to Master Black Belt school. And once I became an asset to an organization as a Master Black Belt, I was into everything. I was into everything from radio systems to missile components to ferrites to small products, plastic encapsulated products, duct tape, fiber optic cable that went undersea. The exposure and learning that I got from being able to bounce around inside an organization when they had a need for Master Black Belts was phenomenal. So one of the companies that I got a chance to know used their belt training and Master Black Belt training to identify future leaders in their organization. And they looked upon this as investing in their future because these people developed technical skills, people skills, the ability to manage from the ground floor to the C-suite. And they looked at that and said, you know, the next time there's a GM slot, this guy's a candidate. It's a definite way to enhance your career, but you have to have the heart and the desire to get there. Chuck, you mentioned two things I want to touch upon. One is training for the sake of training, right? And just for those who have not been trained in the Lean Six Sigma world, a good analogy I always think of is medical doctors. So medical doctors, you can go get your medical degree and pass and become a doctor. But it doesn't mean you're a good doctor, right? You haven't had the hands-on. So our goal is not just to train for the sake of training. Our goal is to get trained to make an impact, like you said, Chuck. The other thing is, you know, as a path forward within a company, the company also has to have a path for you to grow as a specific skill or as a specific resource, right? As a path forward jumping those echelons. You know, one of the guys that we trained with all along, Marco, and you've heard the same thing, used to say, you have to be prepared to burn your boat. You have to leave your comfort zone. You have to know that the only way back home is across the water, over the mountain, to the other side. Absolutely. For some reason, the movie The Hobbit just came to mind. Absolutely. You're right, right? You've got to let go of the past. That's the only way you're going to succeed with these skills. Yeah. You have to be uncomfortable because that's where true growth comes from. Absolutely. Well, this has been a great conversation. Chuck, thank you so much for joining us today and adding your valuable insight to some of these answers to these great questions. We release new episodes every other Wednesday, and you can find all three of us at workstreamconsulting.com and also info at workstreamconsulting.com. And we will see you next time. Thanks again, Chuck. Thanks, Chuck, for coming. Bye, guys. Take care. Are you ready to take your business to the next level? Welcome to Workstream Consulting, your premier partner in Six Sigma training. Whether you prefer virtual or in-person sessions, our comprehensive Six Sigma training programs are designed to fit your needs. What makes us different? At Workstream Consulting, every participant is paired with a dedicated Master Black Belt mentor. Imagine having a personal expert guiding you through every step of the Six Sigma process, ensuring you achieve maximum results. Our personalized mentorship means you're never alone on your journey to operational excellence. Experience the benefits of improved efficiencies, reduced costs, and enhanced customer satisfaction with our Six Sigma training. 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