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Energy Control Systems

Six Sigma Overview

Scott Carcillo

6/8/99

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Energy Control SystemsStrategic Quality Model

Total Customer Satisfaction

(Best in Class)

ImprovedMarket Share

Improved Financial Results

Reinvest and Refine

It All Starts With The Customer

Energy Control SystemsThe Cost of Poor Quality “Iceberg”

Additional Costs of Poor Quality 25-35% of sales

Traditional Quality Costs 4-6% of sales• Inspection

• Warranty

• Scrap

• Rework

• Rejects

Tangible -- Measurable Costs

Intangible -- Difficult or Impossible to Measure

• More Setups

• Expediting

• Lost Sales

• Late Delivery

• Lost Customer Loyalty

• Long Cycle Times

• Engineering Change Orders

Enormous Opportunity

Energy Control Systems

Generation Transmission Distribution

Calgary RTUs Substation Automation Feeder Automation

Edinburgh Trouble Call MgmtSwitch Order MgmtSCADA/Network MgmtMobile Field Systems

Melbourne SCADA Dispatcher Training Simulator

Generation & Transmission Applications Bulk Power Scheduling / Accounting

GE Harris Product Family

Energy Control SystemsWhat Is Six Sigma?

• Goal for Competitive Strength• Strategy for Running a Business • Tool to Eliminate Variation• Vision of Product & Service Excellence• Value to Our Customers• Metric of World Class Companies

6 ... The Way We Run The Business

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Energy Control SystemsQuality

The Classical View of Quality

“99% Good” (3.8

• 20,000 lost articles of mail/hour

• Unsafe drinking water almost 15 minutes each day

• 5,000 incorrect surgical operations per week

• 2 short or long landings at most major airports daily

• 200,000 wrong drug prescriptions each year

• No electricity for almost 7 hours each month

The Six Sigma View of Quality

“99.99966% Good” (6

• Seven lost articles of mail/hour

• One minute of unsafe drinking water every seven months

• 1.7 incorrect surgical operations per week

• One short or long landing at most major airports every five years

• 68 wrong drug prescriptions each year

• One hour without electricity every 34 years

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Energy Control SystemsHarvesting the Fruit of Six Sigma

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

Sweet Fruit Design for Six Sigma

Bulk of FruitProcess Characterization and Optimization

Low Hanging FruitSeven Basic Tools

Ground FruitLogic and Intuition

Process Entitlement

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We don't know what we don't know

We can't act on what we don't know

We won't know until we search

We won't search for what we don't question

We don't question what we don't measure

Hence, We just don't know

Energy Control SystemsThe Focus of Six Sigma

Y

Dependent

Output

Effect

Symptom

Monitor

X1 . . . Xn

Independent

Input-Process

Cause

Problem

Control

To get results, should we focus our behavior on the Y or X?

f (X)f (X)Y=Y=

Historically the Y, ………..with Six Sigma the X’s

Energy Control SystemsD - M - A - I - C

Define

Measure

Analyze

Improve

Control

1. Customer expectations of the process?

2. What is the frequency of defects?

3. When and where do defects occur?

4. How can we fix the process?

5. How can we make the process stay fixed?

Analyzing and Improving Existing Processes

Energy Control SystemsD - F - S - S

Define

Measure

Analyze

Design

Validate

1. Customer expectations of the new process?

2. What is the frequency of defects?

3. When and where do defects occur?

4. How do we design the process for Six Sigma?

5. Formalize and review with customers?

Designing and Validating New Processes

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Energy Control Systems

170

36

126

1997

1998

1999

1999 Six Sigma Challenge

Make the Customer Make the Customer feelfeel Six Sigma Six SigmaMake the Customer Make the Customer feelfeel Six Sigma Six Sigma

Completions

Savings Training

$0.4

$3.8

$7.1 310

36

192

Completions

Savings Training

Energy Control Systems

Overcoming an embedded employee feeling that Six Sigma was the Quality “Flavor of the Month”.

Understanding and dealing with employee pushback to the concept of “Stretch” targets.

Countering organizational pushback to rigorously holding people to their committed numbers.

Focusing on customer CTQs and clear communication instead of a fortress mentality.

GE Harris’ Six Sigma Challenge

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Energy Control SystemsSix Sigma Examples

• Program Execution Efficiency Gains

• Standardized Milestones and Testing

• Sourcing Cost Out

• Sharing fixes Between Product/Customer

• Customer Dashboards

• Operational Dashboards

• Extranet Applications (including web store)

• Enternet View/Data

Energy Control Systems

Review previous Quality programs of acquisitions and joint ventures & prepare to deal with pushback.

Install a thoroughly trained and experienced Quality team into new acquisitions and joint ventures.

Aggressive stretch goals in the first year can dilute project impact & weaken program effectiveness.

Customer dashboard activities must be prepared for unhappy customers unaccustomed to responsiveness.

JV Quality Lessons Learned

Be Patient - Expect Pushback, Coaching Skills Are Critical to Success

Be Patient - Expect Pushback, Coaching Skills Are Critical to Success