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Treasure Chest
of Six Sigma
Growth Methods,
Tools, and Best
Practices
A Desk Reference Book for
Innovation and Growth
Lynne Hambleton
PRENTICE HALL
UPPER SADDLE RIVER, NJ • BOSTON • INDIANAPOLIS • SAN FRANCISCO
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The authors and publisher have taken care in the preparation of this book, but Publisher
make no expressed or implied warranty of any kind and assume no responsibility John Wait
for errors or omissions. No liability is assumed for incidental or consequential Editor in Chief
damages in connection with or arising out of the use of the information or pro- Karen Gettman
grams contained herein.
Acquisitions Editor
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Library of Congress Cataloging-in-Publication Data:
Hambleton, Lynne.
Treasure chest of six sigma growth methods, tools & best practices : a desk reference book for innovation
and growth / Lynne Hambleton.
p. cm.
Includes bibliographical references and index.
ISBN 978-0-13-230021-6 (pbk. : alk. paper) 1. Six sigma (Quality control standard) 2. Strategic planning. 3.
Business planning. 4. Management. I. Title.
HD62.15.H354 2008
658.4’013—dc22
2007016916
Copyright © 2008 Pearson Education, Inc.
All rights reserved. Printed in the United States of America. This publication is protected by copyright, and
permission must be obtained from the publisher prior to any prohibited reproduction, storage in a retrieval
system, or transmission in any form or by any means, electronic, mechanical, photocopying, recording, or like-
wise. For information regarding permissions, write to:
Pearson Education, Inc.
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Upper Saddle River, NJ 07458
Trademarks
All terms mentioned in this book that are known to be trademarks or service marks have been appropriately
capitalized. Prentice Hall publishing cannot attest to the accuracy of this information. Portions of the input and
output contained in this publication/book are printed with permission of Minitab Inc. Minitab™ and the
Minitab logo® are registered trademarks of Minitab Inc. Minitab QUALITY COMPANION™ and the QUAL-
ITY COMPANION logo™are registered trademarks of Minitab Inc. Included in this book are Crystal Ball™
screen captures courtesy of Decisioneering, Inc. Use of a term in this book should not be regarded as affecting
the validity of any trademark or service mark.
10-Digit ISBN 0-132-30021-4
13-Digit ISBN 978-0-132-30021-6
Text printed in the United States on recycled paper at R.R. Donneley & Sons in Crawfordsville, Indiana.
First printing, July 2007
I dedicate this book first and foremost to my loving husband, Bill, and our
two wonderful sons, Corbin and Garrett. I also dedicate this book to Skip
and Kathy Creveling, whose friendship and support are invaluable gifts;
and to Janet Nelson, a fellow consultant and CSSBB, who is courageously
and gracefully battling cancer.
This page intentionally left blank
Preface .......................................................................................................xv
Introduction Different Methods for Different Purposes..................1
Part I Six Sigma Methodology Overview: Choosing the Right
Approach to Address the Requirements
Section 1 Define-Measure-Analyze-Improve-Control (DMAIC)....13
Section 2 Lean and Lean Six Sigma ....................................................29
Section 3 Design for Six Sigma (DFSS) ...............................................45
Section 4 Six Sigma for Marketing (SSFM) ........................................67
Part II Six Sigma Tools and Techniques: Choosing the Right
Tool to Answer the Right Question at the Right Time
The Six Sigma Encyclopedia of Business Tools and Techniques .....115
Summary Tool Matrix ............................................................................115
A Activity Network Diagram (AND) - 7M Tool . . . . . . . . . . . . . 127
Affinity Diagram - 7M Tool..........................................................136
Analysis of Variance (ANOVA)...................................................142
Arrow Diagram..............................................................................159
B Benchmarking ................................................................................160
Box Plots—Graphical Tool ...........................................................165
Brainstorming Technique .............................................................168
C Capability Analysis .......................................................................173
Cause-and-Effect Diagram - 7QC Tool .......................................173
Cause-and-Effect Prioritization Matrix ......................................188
Cause and Prevention Diagram ..................................................198
Checklists - 7QC Tool....................................................................204
Conjoint Analysis ..........................................................................207
Control Charts - 7QC Tool............................................................217
Cost/Benefit Analysis...................................................................238
v
vi Treasure Chest of Six Sigma Growth Methods, Tools & Best Practices
Critical Path Method (CPM) ........................................................242
Critical-to-Quality (CTQ) .............................................................242
D Data Collection Matrix..................................................................248
Design of Experiment (DOE) .......................................................250
Dotplot ............................................................................................280
F Failure Modes and Effects Analysis (FMEA).............................287
5-Whys ............................................................................................305
Fault Tree Analysis (FTA) .............................................................309
Fishbone Diagram - 7QC Tool .....................................................316
Flowchart - 7QC Tool ....................................................................316
G Gantt Chart.....................................................................................317
GOSPA (Goals, Objectives, Strategies, Plans and Actions)......320
Graphical Methods........................................................................323
H Histogram - 7QC Tool ...................................................................330
House of Quality (HOQ) ..............................................................335
Hypothesis Testing ........................................................................335
I Interrelationship Diagram - 7M Tool ..........................................369
K KJ Analysis .....................................................................................375
M Market Perceived Quality Profile (MPQP) ................................390
Matrix Diagrams - 7M Tool ..........................................................399
Measurement System Analysis (MSA) .......................................412
Monte Carlo Simulation ...............................................................431
Multi-vari Chart.............................................................................439
N Normal Probability Plot ...............................................................444
P Pareto Chart - 7QC Tool................................................................445
PERT (Program Evaluation and Review Technique) Chart ....453
Poka-Yoke .......................................................................................462
Porter’s 5 Forces ............................................................................464
Prioritization Matrices - 7M Tool ................................................470
Process Capability Analysis .........................................................486
Process Decision Program Charts (PDPC) - 7M Tool ...............515
Process Map (or Flowchart) - 7QC Tool .....................................522
Pugh Concept Evaluation and Selection....................................534
Q Quality Function Deployment (QFD).........................................543
vii
R RACI Matrix (Responsible, Accountable, Consulted,
Informed)........................................................................................554
Real-Win-Worth (RWW) Analysis...............................................560
Regression Analysis ......................................................................571
Risk Mitigation Plan......................................................................601
Rolled Throughput Yield..............................................................610
Run Chart - 7QC Tool....................................................................611
S 7M - Seven Management Tool .....................................................615
7QC - Seven Quality Control Tool...............................................616
Sampling .........................................................................................618
Scatter Diagram - 7QC Tool .........................................................640
Scorecards .......................................................................................653
SIPOC (Supplier-Input-Process-Output-Customer).................663
SMART Problem & Goal Statements for a Project Charter .....665
Solution Selection Matrix .............................................................672
Stakeholder Analysis ....................................................................681
Statistical Tools...............................................................................684
Stratification - 7QC Tool ...............................................................697
SWOT (Strengths-Weaknesses-Opportunities-Threats)...........699
T Tree Diagram - 7M Tool ................................................................712
TRIZ.................................................................................................715
V Value Stream Analysis ..................................................................727
Voice of Customer Gathering Techniques..................................737
W Work Breakdown Structure (WBS) .............................................753
Y Y = f (X) ...........................................................................................758
Part III Best Practices Articles
The Anatomy of Quality Loss in a Product ...............................763
The Anatomy of Variations in Product Performance ...............777
Benchmarking—Avoid Arrogance and Lethargy .....................789
Building Strength via Communities of Practice and Project
Management...................................................................................799
Complex Organizational Change Through Discovery-based
Learning .........................................................................................827
Lean Six Sigma for Fast Track Commercialization
High Risk-High Reward, Rapid Commercialization:
PROCEED WITH CAUTION! .....................................................835
viii Treasure Chest of Six Sigma Growth Methods, Tools & Best Practices
Listening to the Customer First-Hand; Engineers Too ........... 851
The Practice of Designing Relationships....................................873
A Process for Product Development...........................................887
Selecting Project Portfolios using Monte Carlo Simulation and
Optimization ..................................................................................921
Part IV Appendixes
Appendix A Statistical Distribution Tables...................................939
Appendix B Glossary.......................................................................951
Appendix C References ...................................................................979
Index ........................................................................................................981
Acknowledgments
Thank you to my friends and professional colleagues who contributed to
this book. They took precious time out of their hectic schedules to share
the wisdom they have gained through their business experiences. Some
contributed inadvertently by brainstorming concepts with me, namely
Dan Rose, Joe Szostek, and Chris Tsai. Thank you to the peer reviewers
for reading the early drafts to test for understanding. This invaluable
manuscript input came from colleagues such as Eric Maass and Scott
Wise. Other colleagues authored Best Practices articles, featured in Part III
(listed alphabetically):
• Thank you to Donna Burnette and David Hutchens, for agreeing to
share some of their professional insights on the critical components
of learning that have earned them firm national recognition. Their
article on discover-based learning programs adds an invaluable per-
spective on how best to digest and utilize new knowledge and skills.
This approach transforms otherwise dry, dense content into a fun
and memorable experience.
• Thank you to Mike Cook, whose witty, provocative article on the
importance of collaboration and designing relationships adds color and
refreshing change of pace to this book and reminds us of the impor-
tant human element involved in the work.
• Thank you to Clyde (“Skip”) Creveling for not only sharing his creativity
and thought-leadership in writing an article on how to “fast track” a prod-
uct development process, but also his unending professional support and
guidance.
• Thank you to both Larry Goldman and Karl Luce for sharing best prac-
tices experience on project selection and the portfolio management process
using Monte Carlo simulation and optimization techniques. Their insights help
give a competitive advantage to any reader.
• Thank you to Bill Jewett for his sage and practical approach to writing
not one, but four articles. His depth and breadth of experience as a practi-
tioner, manager, and consultant were shared in two articles about robust
ix
x Treasure Chest of Six Sigma Growth Methods, Tools & Best Practices
design—specifically on quality loss and on performance variation. In addi-
tion, the best practices of collecting and leveraging the Voice of the Cus-
tomer article, as well as a benchmark product commercialization process
article round out an engineering snapshot of product development for a
non-technical business person.
• Thank you to Sy Zivan, one of the benchmarking pioneers in the
1980s from Xerox Corporation, for sharing his knowledge on the best
practices of the benchmarking process. His article reflects his latest
thinking on how benchmarking has evolved over the years.
Thank you to each of these professionals and any others I inadvertently
have missed mentioning for adding your unique and invaluable perspec-
tives, all of which enhanced this book.
Thank you to my family and friends who put up with me during the
writing process. Those who wove a supportive, energizing network
around me include L. Berkowitz, K. Creveling, D. Croessmann, L. Judson,
L. Markt, M. McCandless, and especially my husband, W. Magee.
Most importantly, thank you also to the professionals at Prentice Hall for
their support and hard work to make this book a reality—Heather Fox,
publicist; Bernard Goodwin, editor; Michelle Housley, editorial assistant;
and George Nedeff, development editor (listed alphabetically).
About the Author
Lynne Hambleton is a business consultant with special focus on strategy
development and execution and change management to improve opera-
tional processes and expand commercial opportunities. She has held sev-
eral management positions in Xerox Corporation where she worked for
almost 25 years. She also has worked in education, healthcare, and energy
public sectors and start-ups. Hambleton’s experience spans general man-
agement, marketing, field operations, strategic planning, alliance devel-
opment, and sales/channel management. She also has served as an
adjunct professor of strategic planning at Rochester Institute of Technol-
ogy’s School of Business.
Ms. Hambleton received a Master’s degree in Business Administration,
with an emphasis in industrial marketing; a Master’s degree in Adult &
Higher Education/Organizational Development; and a Bachelor of Sci-
ence degree in psychophysiology, all from University of North Carolina—
Chapel Hill. Ms. Hambleton is also an active PMI-certified Project
Management Professional (PMP) (1998); a Master Black Belt; and Certi-
fied Six Sigma Black Belt (CSSBB) from Villanova University (2006).
Hambleton’s additional publications include Six Sigma for Marketing
Processes, An Overview for Marketing Executives, Leaders, and Managers (co-
authors C.M. Creveling and B. McCarthy), Prentice Hall, 2006; the chap-
ter titled, “Supporting a Metamorphosis through Communities of
Practice,” in Leading Knowledge Management and Learning, by Dede Bonner,
2000; and the article, “How Does a Company the Size of Xerox Design a
Curriculum in Project Management for the Entire Organization?” printed
in In Search of Excellence in Project Management, Volume 2, by Harold
Kerzner, 1999. Ms. Hambleton lives in Rochester, New York, and can be
reached best via email at
[email protected] or visiting
www.mageemanagement.com.
xi
This page intentionally left blank
Preface
The Treasure Chest is part of Prentice-Hall’s Six Sigma for Innovation and
Growth Series. This book serves as a consolidated “how to” reference book
of Lean Six Sigma, covers growth and innovation tools, provides an
overview of methods and the tools to which they align, and offers an
overview of additional best practices used to manage a successful Six
Sigma growth initiative. The Treasure Chest of Six Sigma Growth Methods,
Tools, and Best Practices guides you in selecting the right tool to answer the
right question at the right time. The right question drives the requirement or
need to be addressed—regardless whether the requirement comes from
your customer or a business need. Understanding the overall objective, or
requirement, helps determine which Six Sigma methodology to use. The
right time dictates what else you know given where you are in your
approach. Understanding whether you are in the planning, designing,
implementing, or maintaining phases of an overall process determines
which process step, thereby the context of the question being asked.
Finally, the right tool should be the last question asked, as it is based on
first knowing what is required and at what point you are in the process.
The Treasure Chest is a desk-reference book for people interested in
growth, operations excellence, and business-process improvement. This
book speaks to the general business practitioner, business analyst, man-
ager, and leader, regardless of the business context. It is for profit or non-
profit enterprises; large or small firms; whether in headquarters-function,
plant, or field location, regardless of functional discipline.
The book covers a range of applications from strategic planning aspects
of business (offering portfolio renewal) to presenting development and
launch preparation, from post-launch operations management to offering
discontinuance. Whether contributing a new design (product and/or
service), proposing a new process, evaluating a portfolio of offerings, or
managing a current portfolio of offerings, this book compiles the
resources that help drive growth proactively and presents them in a
quick-reference format for easy navigation. This book takes the hassle
out of researching the methodology and tools so you can immediately
begin to find solutions for your discipline.
The Treasure Chest speaks primarily to business people who need practical
“hands-on” guidance and answers to the following questions:
xiii
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