TOC Lean Six Sigma

TOC Lean Six Sigma (TLS) is as an alternative continuous improvement process management approach.

Description

TOC Lean Six Sigma (TLS) utilizes the Theory of Constraints (TOC), Lean and Six Sigma principles in a special sequence which is claimed to deliver higher results than if each one of the continuous methodologies were used individually.

TLS process highlights, how it flows and sequence of activities

The sequence of activities begins with application of TOC:

a. Apply the 5-step TOC process to investigate the problem at hand from a 30,000 foot level or satellite-level, which is an approach to measure overall firm’s performance (the entire value stream), at a high level. The purpose is to identify the existing or potential constraint(s) in the entire value stream. This methodology was introduced by Dr. Reza M. Pirasteh in 2003.

The process begins with steps 1 and 2 of the TOC's 5-step "focusing process":

1. Identify the constraint 2. Exploit the constraint b. After identifying the problem statement at a system level, the mobilized teams will have a specific problem definition that addresses the organization’s bottleneck. At this stage, four steps out of the six-step lean process should be applied.

These steps would be:

1. Specify the value 2. Identify the value stream 3. Make value flow without any interruptions 4. Let the customer pull value from the producer

By going through steps one through four, the resources of waste in the process would be identified and targeted for improvement. A parallel approach to implement 5-S at this phase needs to be considered to bring order and discipline into the process activities. 5-S would also assist in sustaining any process gain achieved and promote continuous improvement as a way of work life. The value-add which is the effort that customer is willing to pay for it, would be identified through the value-stream-mapping process. A waste-less value stream would be considered by streamlining the activities, so that queues and unnecessary inventories and work-in-process would be minimized. By implementing pull systems, the value chain would produce products or services only upon customer requirement. The focus would be to produce the required amount, at the requested time to be delivered to the exact customer and location. After eliminating or minimizing the waste, the new process flow should be established. At this stage, the process input variables need to perform consistently and repeatedly with minimal variability to achieve the best results to minimize waste, scrap, or rework. This leads to steps five and six following the lean process methodology.

c. At this stage of process, Lean’s steps five and six should be implemented:

5. Pursue perfection
6. Implement with agility

To pursue perfection, Six Sigma’s Define, Measure, Analyze, Implement, and Control (DMAIC), should be applied to identify and isolate the source(s) of process variation and systematically remove or minimize those variations. When the source(s) of process variation have been identified through the screening process, using Six Sigma’s analytical tools, the critical few factors are identified for process control. During this stage it may be necessary to perform design of experiments (DOE) to establish the optimal settings for the critical factors that have been identified. Upon establishing the optimal process variable settings, it is necessary to establish standard operating procedures and control mechanisms to ensure that the process critical factors will remain in statistical control and will not drift over time significantly. Application of Poka-Yoke and statistical process control is essential to sustain the process gains and provide an early warning system to prevent process variability.After completing the process perfection which actually is the error minimization relative to the specification, the process is continued with TOC's 3rd element:

3. Subordinate other activities to the constraint

This is to ensure that other processes feeding the constraint are subordinated to the constraint and do not starve the constraint, protecting the throughput and quality. Next applying steps 4 and 5 of TOC:

4. Elevate the constraint 5. Avoid negative inertia – Go to step 1

At this stage the process should be scanned to detect potential movement or shift of the "constraint". After detection of the constraint process step 1 should be followed.

A process audit also needs to be designed to monitor process performance over time to ensure that the process gains are maintained. If any deviations are observed during the audit process, they should be the triggers for corrective and preventive action plans.

TLS process Summary

Pirasteh(3,4) explains the TLS process as following:

1. Apply TOC to focus on what needs to be fixed 2. Apply Lean to eliminate waste 3. Apply Six Sigma to optimize process variability and error

TLS as a CPI approach is becoming popular among the experts. Weber State University at Utah, in May 2007 introduced TLS as a credible CPI alternative to the academia. TLS is considered to be an academic curriculum at Weber State University. Dr. Goldratt recognized TLS's significant contributions during the TOCICO symposium in Nov 2007.

TLS was recognized as an effective CPI approach by Business and Industrial Assistance Division (BIAD)- Great Lakes Trade Adjustment Assistance Center EDA University Center for Economic Diversification Economic Development Related Research of University Of Michigan.

Also see:

RPA processEugene Goodson Ph.D., and Izak Duenyas Ph.D.University of Michigan Executive Education,

Rapid Flexible BTO processEric P. Jack, Ph.D., CPIM University of Alabama

References

*Breyfogle, F. W, III.; (2003). "Implementing Six Sigma" (2nd ed), Hoboken: John Wiley & Sons, Inc.
*Eckes, George; "Making Six Sigma Last: Managing the Balance Between Cultural and Technical Change" (Six Sigma Research Institute Series) (Hardcover - May 3, 2001
*Emiliani, B., with Stec, D., Grasso, L. and Stodder, J. (2007), "Better Thinking, Better Results: Case Study and Analysis of an Enterprise-Wide Lean Transformation", second edition, The CLBM, LLC Kensington, Conn., ISBN 978-0-9722591-2-5
*George L. Michael; "Lean Six Sigma for Service: How to Use Lean Speed & Six Sigma Quality to Improve Services and Transactions", McGraw-Hill, 2002
*Goldratt, E. M.; (1990). "Theory Of Constraints And How Should It Be Implemented", Great Barrington: North River Press Publication Corporation.
*Liker, Jeffrey; (2003), "The Toyota Way: 14 Management Principles from the World's Greatest Manufacturer", First edition, McGraw-Hill, ISBN 0-07-139231-9.
*Ohno, Taiichi (1995), "Toyota Production System: Beyond Large-scale Production", Productivity Press Inc., ISBN 0-915299-14-3.
*Pirasteh, R. M. (2005) “Effects of Combined Approach of Theory Of Constraints, Lean and Six Sigma on Process Improvement” doctoral dissertation.
*Pirasteh, R. M.& Farah, K. (2006). "Continuous Improvement Trio", APICS. 16(10), 28-31.
*Schmidt R. Stephen & Launsby G. Robert; "Understanding Industrial Designed Experiments Blending The Best of the Best Designed Experiment Techniques" – 4th ed.
*Shingo, Shigeo (1989) "A Study of the Toyota Production System from an Industrial Engineering Viewpoint (Produce What Is Needed, When It's Needed)", Productivity Press, ISBN 0-915299-17-8. (This refers to the English version; the Japanese version was published in 1981, but the ISBN is unknown)
*Spear, Steven, and Bowen, H. Kent (September 1999), "Decoding the DNA of the Toyota Production System," "Harvard Business Review"
*Spector, Robert E. (2006) “How Constraints Management Enhances Lean and Six Sigma” – "Supply Chain Management Review", Jan/Feb 2006
*Wislon, S. B. Business and Industrial Assistance Division (BIAD)Great Lakes Trade Adjustment Assistance Center EDA University Center for Economic Diversification Economic Development Related Research, http://www.cargroup.org/mbs2006/documents/WilsonSteve.pdf
*Womack, J. P. & Jones, D. T. (2003). "Lean Thinking", New York: Free Press.
*Yasuhiro Monden; (1998), "Toyota Production System, An Integrated Approach to Just-In-Time", Third edition, Norcross, GA: Engineering & Management Press, ISBN 0-412-83930-X.