Evaluation of possible Six Sigma implementation including a DMAIC project

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Six Sigma is an initiative lauched by Motorola in 1987, focusing on reducing variation and continuously improving processes.

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2004:070 CIV MASTER’S THESIS Evaluation of possible SIX SIGMA implementation including a DMAIC project A case study at the Cage Factory, SKF Sverige AB MARTIN LENNARTSSON ERIK VANHATALO MASTER OF SCIENCE PROGRAMME Department of Business Administration and Social Science Division of Quality & Environmental Management 2004:070 CIV • ISSN: 1402 - 1617 • ISRN: LTU - EX - - 04/70 - - SE
-TITLES- Evaluation of possible SIX SIGMA implementation including a DMAIC project - A CASE STUDY AT THE CAGE FACTORY, SKF SVERIGE AB Utvärdering av möjlig SEX SIGMA implementering samt ett DMAIC-projekt - EN FALLSTUDIE PÅ HÅLLAREFABRIKEN, SKF SVERIGE AB This Master Thesis was carried out within the area of Quality Management at Luleå University of Technology and SKF Sverige AB. By: Martin Lennartsson Erik Vanhatalo Luleå 2004-02-29 Supervisors: Lars Palmqvist, SKF Sverige AB in Gothenburg Karin Schön, Luleå University of Technology
-ABSTRACT- ABSTRACT Six Sigma is an initiative launched by Motorola in 1987, focusing on reducing variation and continuously improving processes (Barney, 2002). This thesis was carried out at the Cage Factory in Gothenburg, a smaller unit within SKF Sverige AB with 124 employees. The factory manufactures the cage component in the bearing, which will keep the rollers in place in the complete bearing. The purpose of this thesis is to investigate and make comparisons between Six Sigma and the existing way of working with improvements and the organization in the Cage Factory and to give recommendations on what actions are needed to efficiently implement Six Sigma. To aid in the fulfillment of the purpose a practical DMAIC (Define- Measure-Analyze-Improve-Control) project was conducted. The project aims to reduce customer complaints and downtime caused by the turning activity in one of the production channels at the Cage Factory. Furthermore, several interviews with strategically selected individuals were conducted. The authors argue that Six Sigma could be implemented and integrated with the existing improvement approach, Total Process Management, TPMG. Six Sigma can be used to attack the most complex problems, while TPMG handles the many day-to-day issues. At the moment the implementation strategy "Strategically selected individuals and projects" is the most applicable at the Cage Factory. The authors argue that Six Sigma will provide a structure (DMAIC) and training in tools, thereby ensuring that the tools are used at the right time and in the right way at the Cage Factory. In the future, there has to be a strategy for generating possible Six Sigma projects at the Cage Factory. Also, it is important that a way for steering different problems to different problem solving activities is developed. However, some issues need to be considered if Six Sigma should work efficiently at the Cage Factory. A training venture is needed to enable the introduction of different roles in the organization. Also, all training should be connected to practical experience. It is important that the Cage Factory receives resource support from SKF Sverige and/or the SKF Group. Further, a reliable measurement system must be implemented. The authors believe that improved scrap reporting and improved use of SPC are important actions that need to be taken.
-SAMMANFATTNING- SAMMANFATTNING Sex Sigma fokuserar på att reducera variation samt att kontinuerligt förbättra företagets processer och introducerades av Motorola 1987 (Barney, 2002). Detta examensarbete har utförts på Hållarefabriken i Göteborg som är en mindre enhet inom SKF Sverige AB med 124 anställda. Fabriken producerar hållarkomponenten i lagret som har till uppgift att hålla rullar på plats i det färdiga lagret. Syftet med examensarbetet är att utvärdera och jämföra Sex Sigma med det rådande förbättringsarbetet och organisationen på Hållarefabriken samt att ge rekommendationer på vad som bör åtgärdas för att effektivt kunna införa Sex Sigma. För att uppfylla syftet har bland annat ett DMAIC-projekt utförts. Projektets syfte är att reducera antalet kundreklamationer och minska stopptid orsakade av svarvning i en av produktionskanalerna på Hållarefabriken. Vidare har ett antal intervjuer genomförts med strategiskt utvalda individer. Författarna menar att Sex Sigma kan implementeras och integreras i det nuvarande förbättringsarbetet, Total Process Management (TPMG). Sex Sigma kan användas för att attackera de mest komplexa problemen inom verksamheten, medan TPMG hanterar de vardagliga åtgärderna som krävs för att utveckla verksamheten på lång sikt. För tillfället är implementeringsstrategin "strategiskt utvalda individer och projekt" den mest lämpliga för Hållarefabriken. Författarna anser att Sex Sigma kommer att ge en struktur (DMAIC) och träning i verktyg, vilket i sin tur innebär att verktygen används vid rätt tillfälle och på rätt sätt på Hållarefabriken. I framtiden måste det finnas en strategi för att generera möjliga Sex Sigma- projekt på Hållarefabriken. Dessutom är det viktigt att det utvecklas ett sätt att styra olika problem till olika problemlösningsalternativ. Det finns dock en del åtgärder som måste vidtas för att Sex Sigma ska kunna fungera effektivt på Hållarefabriken. En utbildningssatsning krävs för att möjliggöra en introduktion av roller i organisationen. All utbildning bör dessutom ske i samband med deltagandet i ett praktiskt projekt. Det är viktigt att Hållarefabriken får stöd, i form av resurser, från SKF Sverige och SKF-koncernen. Författarna anser att en förbättrad kassationsrapportering och förbättrad användning av programvaran för SPS är viktiga åtgärder för att skapa ett väl fungerande mätsystem.
-ACKNOWLEDGEMENTS- ACKNOWLEDGEMENTS This Master Thesis was carried out during the period from late September 2003 to early February 2004 at the Cage Factory, SKF Sverige AB in Gothenburg, Sweden. We would like to take the opportunity to thank SKF Sverige AB and especially the Cage Factory's entire staff for giving us the opportunity to write our Master Thesis by studying their organization. Furthermore, we also wish to thank our supervisor at Luleå University of Technology, Luleå, LTU, Karin Schön as well as our supervisor at the Cage Factory Lars Palmqvist for their valuable support during the completion of this Thesis. Moreover, the authors would like to express a special thanks to the members of the improvement group taking part in the DMAIC project presented in this Thesis. Without their committed participation this Thesis' completion wouldn't have been possible. Also, we thank all the different individuals that gave us some of their valuable time taking part in the interviews made in this Thesis. Last but not least, we would like to thank the Division of Quality and Environmental Management at LTU for the opportunity to complete our Master's study at their Division and for support during this and earlier courses. Especially we would like to thank Görgen Edenhagen, Master Thesis Coordinator and fellow course mates giving us feedback at Master Student's seminars. Gothenburg, February 2004 Martin Lennartsson Erik Vanhatalo
-CONTENTS- CONTENTS LIST OF FIGURES, PICTURES AND TABLES.................................................1 FIGURES ..................................................................................................................1 PICTURES .................................................................................................................2 TABLES ....................................................................................................................2 LIST OF ABBREVIATIONS..................................................................................3 1. INTRODUCTION ................................................................................................4 1.1. BACKGROUND ..................................................................................................4 1.1.1. The development of quality engineering ..................................................4 1.1.2. Company presentation..............................................................................6 1.2. PROBLEM DISCUSSION ......................................................................................8 1.3. PURPOSE AND DELIMITATIONS ........................................................................10 1.3.1. Purpose of the thesis ..............................................................................10 1.3.2. Delimitations ..........................................................................................10 1.4. THE OUTLINE OF THE THESIS ...........................................................................11 2. METHODOLOGY.............................................................................................12 2.1. RESEARCH APPROACH ....................................................................................12 2.1.1. Positivism or Hermeneutics ...................................................................12 2.1.2. Induction or Deduction ..........................................................................13 2.1.3. Quantitative or Qualitative method .......................................................14 2.2. RESEARCH STRATEGY .....................................................................................14 2.3. LITERATURE STUDY ........................................................................................15 2.4. CHOICE OF DATA COLLECTION METHOD .........................................................16 2.4.1. Primary data ..........................................................................................16 2.4.2. Secondary data .......................................................................................18 2.5. METHODOLOGY AND CHOSEN TOOLS IN THE DMAIC PROJECT......................18 2.6. RELIABILITY AND VALIDITY ...........................................................................19 2.6.1. Validity ...................................................................................................19 2.6.2. Reliability ...............................................................................................20 3. THEORETICAL FRAME OF REFERENCE ................................................21 3.1. SIX SIGMA ......................................................................................................21 3.1.1. The Six Sigma Framework .....................................................................23 3.1.2. The Six Sigma Infrastructure .................................................................24 3.1.3. Strategies for Six Sigma Implementation ...............................................25 3.1.4. Critique to Six Sigma..............................................................................27 3.2. THE DMAIC IMPROVEMENT CYCLE ...............................................................28
-CONTENTS- 3.2.1. How to choose a Six Sigma project........................................................29 3.2.2. The Define Phase ...................................................................................29 3.2.3. The Measure Phase ................................................................................30 3.2.4. The Analyze Phase .................................................................................31 3.2.5. The Improve Phase.................................................................................31 3.2.6. The Control Phase..................................................................................31 3.2.7. Examples of tools in the different phases...............................................32 3.2.8. Tools Chosen in the DMAIC project......................................................33 3.3. OTHER QUALITY INITIATIVES .........................................................................34 3.3.1. Total Quality Management, TQM ..........................................................34 3.3.2. Total Process Management and TPM, the SKF way .............................35 3.4. TURNING ........................................................................................................37 4. THE EMPIRICAL STUDY...............................................................................38 4.1. THE DMAIC PROJECT ....................................................................................38 4.1.1. The Define Phase ...................................................................................38 4.1.2. The Measure Phase ................................................................................41 4.1.3. The Analyze Phase .................................................................................47 4.1.4. The Improve Phase.................................................................................49 4.1.5. The Control Phase..................................................................................52 4.1.6. Evaluation of the DMAIC project ..........................................................53 4.2. INTERVIEWS ...................................................................................................54 4.2.1. Lars Arrenäs, TPMG Manager, SKF.....................................................55 4.2.2. Cecilia Lack, TPMG Coordinator at the Cage Factory ........................56 4.2.3. Folke Höglund, Quality Assurance Manager, SKF Group....................57 4.2.4. Bo Bergman, Professor, Chalmers University of Technology, CTH .....59 4.2.5. Laszlo Persson, Master Black Belt at Volvo Cars Engine in Skövde ....61 4.3. FOCUS GROUP AT THE CAGE FACTORY ...........................................................68 5. ANALYSIS AND RESULTS.............................................................................72 5.1. EXPERIENCE FROM THE DMAIC PROJECT ......................................................72 5.1.1. The scope of the project .........................................................................72 5.1.2. The cost issue .........................................................................................73 5.1.3. Collection and evaluation of data ..........................................................73 5.1.4. DMAIC methodology, tools and results .................................................74 5.2. ANALYSIS OF SIX SIGMA IMPLEMENTATION AT THE CAGE FACTORY .............76 5.2.1. Why adopt Six Sigma?............................................................................76 5.2.2. The Six Sigma Framework at the Cage Factory ....................................77 5.2.3. Organization and Six Sigma Roles.........................................................80 5.2.4. Methodology and Tools..........................................................................81
-CONTENTS- 6. CONCLUSIONS AND DISCUSSION .............................................................82 6.1. CONCLUSIONS ................................................................................................82 6.2. DISCUSSION ....................................................................................................83 6.2.1. Thesis generalization..............................................................................83 6.2.2. Criticism to sources and methodology...................................................83 6.2.3. Problems with the purpose of the thesis.................................................85 6.2.4. Future work ............................................................................................85 REFERENCES .......................................................................................................86 BIBLIOGRAPHIC REFERENCES.................................................................................86 ELECTRONIC REFERENCES .....................................................................................87 PAPER REFERENCES ...............................................................................................88 ORAL REFERENCES ................................................................................................88 OTHER REFERENCES ..............................................................................................89 SUPPLEMENTS ....................................................................................................90 APPENDICES ......................................................................................................102 GLOSSARY ..........................................................................................................110 INDEX ...................................................................................................................111
-CONTENTS- LIST OF FIGURES, PICTURES AND TABLES Figures Page FIGURE 1.1 DEVELOPMENT OF THE QUALITY CONCEPT ................................................5 FIGURE 1.2 THE SKF BUSINESS CONCEPT ..................................................................6 FIGURE 1.3 THE SKF QUALITY POLICY ......................................................................7 FIGURE 1.4 SKETCH OF THE WORKFLOW IN CHANNEL 13 AT THE CAGE FACTORY ......9 FIGURE 2.1 INDUCTIVE AND DEDUCTIVE APPROACH IN RESEARCH ............................13 FIGURE 3.1 NORMALLY DISTRIBUTED PROCESS PERFORMING AT SIX SIGMA LEVEL ..22 FIGURE 3.2 COSTS, IN PER CENT OF TURNOVER, DEPENDING ON SIGMA LEVEL ..........22 FIGURE 3.3 THE CORPORATE FRAMEWORK OF SIX SIGMA .........................................23 FIGURE 3.4 STRUCTURE OF A GENERAL SIX SIGMA PROJECT .....................................25 FIGURE 3.5 STRATEGIES FOR SIX SIGMA IMPLEMENTATION ......................................26 FIGURE 3.6 THE DMAIC METHODOLOGY .................................................................28 FIGURE 3.7 COMMONLY USED SOURCES FOR PROJECT GENERATION ..........................29 FIGURE 3.8 VARIATION IN INPUT VARIABLES ARE TRANSFERRED TO THE OUTPUT .....30 FIGURE 3.9 COMMONLY USED TOOLS IN A DMAIC PROJECT ....................................33 FIGURE 3.10 QUALITY TOOLS IN THE DMAIC PROJECT ............................................33 FIGURE 3.11 LINK BETWEEN VALUES, METHODOLOGIES AND TOOLS.........................35 FIGURE 3.12 THE OPERATOR MAINTENANCE STAIRCASE .........................................36 FIGURE 3.13 THE CONCEPT OF LONGITUDINAL AND FACE TURNING ..........................37 FIGURE 4.1 PARETO CHART OVER CUSTOMER COMPLAINTS .......................................39 FIGURE 4.2 HISTORICAL DEVELOPMENT OF COMPLAINTS IN CHANNEL 13.................39 FIGURE 4.3 PARETO CHART FOR IDENTIFIED COMPLAINT CAUSES IN CHANNEL 13 ....39 FIGURE 4.4 PROCESS MAP OF THE TURNING ACTIVITY ..............................................41 FIGURE 4.5 PIE CHART OF DOWNTIME IN DIFFERENT MACHINES IN CHANNEL 13 ......42 FIGURE 4.6 PARETO CHART OF DURATIONS FOR DIFFERENT CAUSES .........................43 FIGURE 4.7 RESULT OF THE FREQUENCY STUDY IN THE TURNING PROCESS...............44 FIGURE 4.8 THE OUT OF CONTROL SITUATION FOR ONE OF THE STUDIED CAGES ........49 FIGURE 4.9 THE KANO MODEL .................................................................................60 FIGURE 4.10 SKETCH OF THE SIX SIGMA ORGANIZATIONAL STRUCTURE AT VCES ...64 FIGURE 4.11 PROJECT LIFE AND RESPONSIBILITIES AT VCES ....................................65 FIGURE 4.12 PROBLEM SOLVING ACTIVITIES AT VCES .............................................65 FIGURE 5.1 HOW SIX SIGMA AND TPMG DEALS WITH PROBLEMS ............................77 FIGURE 5.2 TPMG AND SIX SIGMA AT THE CAGE FACTORY .....................................79 FIGURE S.1 PROJECT CHARTER USED IN THE DMAIC PROJECT.................................92 FIGURE S.2 FREQUENCY STUDY FORM USED IN THE DMAIC PROJECT......................93 FIGURE S.3 CAUSE-AND-EFFECT DIAGRAM FROM THE DMAIC PROJECT .................95 -1-
-CONTENTS- FIGURE S.4 PROCESS-FMEA DEVELOPED IN THE DMAIC PROJECT .........................98 FIGURE S.5 TREE DIAGRAM DEVELOPED IN THE DMAIC PROJECT .........................100 FIGURE S.6 MATRIX DIAGRAM DEVELOPED IN THE DMAIC PROJECT ....................101 FIGURE A.1 CONVERTING DPMO TO SIGMA VALUES ................................................103 FIGURE A.2 THE SEVEN-TIMES-SEVEN TOOLBOX ...................................................104 Pictures PICTURE 1.1 CAGE AND RADIAL BEARING ...................................................................7 PICTURE 4.1 THE IMPROVEMENT GROUP ...................................................................42 PICTURE 4.2 DEFECTS IN THE TURNING ACTIVITY......................................................44 Tables TABLE 4.1 CUSTOMER COMPLAINTS PER PRODUCTION CHANNEL ..............................38 TABLE 4.2 POTENTIAL FAILURE CAUSES WITH THE HIGHEST RPN.............................48 TABLE 4.3 MEASURES FROM THE TREE DIAGRAM WITH 18 POINTS ...........................50 TABLE 4.4 MEASURES CORRELATED TO PROBLEMS DETECTED IN THE FMEA...........51 TABLE S.1 THE CUSTOMER COMPLAINT PROCESS ....................................................96 TABLE A.1 TRAINING CONTENT FOR DIFFERENT ROLES ...........................................103 -2-
-ABBREVIATIONS- LIST OF ABBREVIATIONS ABB Asea Brown Bovery ANOVA Analysis of Variance ANOM Analysis of Means Cp Process Capability Ratio Cpk Process Capability Ratio, considering centering CTH Chalmers University of Technology CTQ Critical To Quality DFSS Design For Six Sigma DMAIC Define, Measure, Analyze, Improve, Control DPMO Defects Per Million Opportunities DOE Design Of Experiments FADE Focus, Analyze, Deploy and Evaluate FMEA Failure Modes and Effects Analysis H1, H2, H3 Production Section 1, 2 and 3 in the Cage Factory ISO International Standardization Organization KLEMM "Kvalitet" (Quality), "Leverans" (Delivery), "Ekonomi" (Economy), "Miljö" (Environment) and "Medarbetare" (Co-worker) KTI Kvalitets Tillstånds Information (Quality State Information) LSL Lower Specification Limit LTU Luleå University of Technology MBNQA Malcolm Baldridge National Quality Award MCSS Manufacturing Customer Service System NC Numerically Controlled PDCA Plan, Do, Check, Act PTS Project Tracking System QFD Quality Function Deployment QIT Quality Improvement Teams PCR Process Capability Ratio R&R Repeatability & Rreproducibility RPN Risk Priority Number SEK Swedish Krona (Currency) SIPOC Suppliers, Inputs, Process, Outputs, Control SIQ Institutet För Kvalitetsutveckling SKF Svenska Kullagerfabriken SPC Statistical Process Control TPM Total Productive Maintenance TPMG Total Process Management TQM Total Quality Management TRIZ Theory of Inventive Problem Solving USL Upper Specification Limit VCES Volvo Cars Engine in Skövde VMEA Variance Mode and Effect Analysis VOC Voice Of Customer -3-
-INTRODUCTION- 1. INTRODUCTION This chapter begins with the background of the thesis, containing an overview of the quality concept and a company presentation. Then a problem discussion will follow and finally the purpose and delimitations of the thesis will be presented to the reader. 1.1. Background 1.1.1. The development of quality engineering An important question that Company Managers are asking themselves is "How do we become successful?", but a question of equal importance is “How do we stay successful in the future?” (Pande, Neuman & Cavangh, 2000). A company cannot survive without customers. According to Pyzdek (2003) it is therefore very important that the company provides products that the customers are willing to pay for. In plain language this means that the ultimate goal for the company is to create value to the customer. Hence, the customer settles the quality of a product. The word quality has its origin from the Latin word "qualitas”, which means “character” (Bergman & Klefsjö, 2001). There are several different definitions of the Quality Concept and many different opinions of what should be included in the concept of product quality. The authors have fallen for a definition of the quality of a product from Bergman & Klefsjö (2001): "The quality of a product is its ability to satisfy and preferably exceed the needs and expectations of the customers". (Translated from Bergman & Klefsjö, 2001 p.24) The approaches that have been used to deal with quality problems have changed over time. Bergman & Klefsjö (2001) mean that the dominating quality technique used shortly after World War II was Quality Control of finished products, a defensive technique. Since then, the development direction has been to increase the efforts before the production process begins and also to work with continuous improvements. This development is illustrated in Figure 1.1. The Swedish Institute of Quality, SIQ, shares this point of view (SIQ, 2003). -4-
-INTRODUCTION- Quality Management…continuous improvements before, during and after production Quality Assurance …before production Development Quality Monitoring …during production Quality Control …after production Figure 1.1 Development of the Quality Concept from the middle of the twentieth century. Source: Bergman & Klefsjö (2001, p.94). In the more recent history of the quality development, the quality improvement program Six Sigma has been successful. The American company Motorola developed Six Sigma as a consequence of poor quality and customer complaints, which affected the competitive power of the company negatively (Barney, 2002). In 1986 Bill Smith, engineer and statistician at Motorola, introduced the Six Sigma concept aiming to attack the existing quality problems in the company. Motorola began documenting their key processes, aligning them toward customer requirements, measuring and analyzing to be able to improve their processes continuously and reduce variation (Barney, 2002). In 1988 Motorola won the Malcolm Baldridge National Quality Award, MBNQA1 and the interest for Six Sigma increased (Pyzdek, 2001). Since Motorola launched Six Sigma in 1987 and particularly from 1995, a growing number of global companies have followed, developing Six Sigma programs of their own (Magnusson, Kroslid & Bergman, 2003). Today, Six Sigma is well established in the automotive, aviation, chemical, electronic and metallurgy industries (ibid). A recent successful example of Six Sigma implementation in Sweden is Volvo Cars Corp., which after three years and around 500 completed Six Sigma projects presents net savings of about one Billion SEK (Dahlquist, 2003). Bergman & Klefsjö (2001) claims that the goal of Six Sigma is to substantially reduce unwanted variation that either results in cost reductions or increased customer satisfaction. The reduced variation may also lead to improved delivery performance and increased process yield. 1 The MBNQA is an annual quality award in the USA and was established in 1987 when the sitting president Ronald Reagan signed the MBNQ improvement Act. The award is named after a former American Secretary of Commerse, Malcolm Baldridge (Dale, 1999). -5-
-INTRODUCTION- 1.1.2. Company presentation Findings of simple forms of ball bearings from archeological excavations have been dated to the days of the Roman Empire. The basic function of a bearing is to facilitate the rotation of wheels and axles. When the bicycle with pedals was introduced during the 19th century, the importance of bearings grew to make it easier for the user to ride the bike. This sped up the development of ball bearings. In 1907 the Swedish engineer Sven Wingquist introduced the first self-aligning2 ball bearing and later that year he founded "Svenska KullagerFabriken", (the Swedish Ball Bearing Factory), SKF (SKF, 2003a). In 2002 The SKF Group, having business activities at 79 locations around the world, had an annual turnover exceeding SEK 42 Billion and presented a pre-tax profit of SEK 3.5 Billion. The SKF Group employs 39,700 people, of which 4,600 in Sweden (SKF, 2003e). The SKF Group has five subdivisions: Automotive, Electrical, Industrial, Service and Aero and Steel Division. These divisions also include a number of subsidiaries located in different countries around the world. In Sweden the activities are centered round SKF Sverige AB and its thirteen subsidiaries, which work with everything from refining raw material to business development (SKF, 2003c). The SKF business concept is presented in Figure 1.2. SKF's mission is to enhance and develop global leadership in bearings, seals, related products, systems and services. Our aim is to be the best in the industry at: Values Drivers - providing customer value - Empowerment - Profitability - developing our employees - High ethics - Quality - creating shareholder value - Openness - Innovation - Teamwork - Speed (SKF, 2003e p.1) Figure 1.2 The SKF Business Concept. SKF's attitude and commitment to quality is communicated through the Quality Policy, which is displayed in Figure 1.3. 2 A self-aligning bearing is characterized by its ability to adjust to skewed axles. This is possible because the inner ring of the bearing is spherical which allows the inner and outer ring to interact (Huttunen, 2003a). -6-
-INTRODUCTION- Aim for Total Quality in everything we do Market only products and services that will ensure customer satisfaction by: - Operating reliable and capable processes - Maintaining a program of continuous improvement (SKF, 2003d) Figure 1.3 The SKF Quality Policy SKF's largest individual customer is the French Railway. Other important customer segments are for example crushing machine manufacturers, paper mills and wind power plants (Huttunen, 2003). This thesis is focusing on the situation at the Cage Factory, SKF Sverige in Gothenburg. The factory is manufacturing the cage component in a bearing. The function of a cage is to keep the rollers in place in the complete bearing. Picture 1.1 shows a cage for a radial bearing. There are 124 employees at the factory and the annual turnover is about SEK 170 Million. The factory is divided into three sections with a total of 14 production flows. There are about 200 standard versions of cages in production with dimensions 100-2,008 mm in diameter (Huttunen, 2003). 70 per cent of the production moves on to assembly at SKF's other factories in Gothenburg. More then 20 per cent are assembled at factories in the USA and the remaining part goes to factories in England and Malaysia. The annual production is roughly 2.5 Million cages and the dominating types are cages for radial bearings3, which constitute about 95 per cent of the production (ibid). A cage for a radial bearing and a complete radial bearing can be viewed in Picture 1.1. (a) (b) Picture 1.1 (a) Cage for a radial bearing. (b) Complete radial bearing. 3 The radial bearings are designed to carry load in radial direction of the shaft. -7-
-INTRODUCTION- 1.2. Problem discussion There are many ways to deal with quality problems in a manufacturing company. The past 15-20 years many new methods, strategies and tools have emerged in the quality area, for example Total Quality Management, TQM, has been a popular approach that many companies have adopted (Pande et al., 2000). In recent years Six Sigma has grown in popularity especially in the US and companies like General Electric and Motorola have obtained significant improvements in their performance (Pande et al., 2000). A reason for their success is probably Six Sigma's ability to prove reduced costs or higher profits in economical measures. The SKF Group has taken a decision to start a Six Sigma initiative within the entire group during 2004. Each division will be responsible for its own time plan to launch Six Sigma (de Laval, 2003). Earlier, the Automotive Division has decided to start a Six Sigma initiative within the division and has recently started a Black Belt training program. Chicago Rawhide (USA) for example, working in the seal area has completed roughly, 300- 400 Six Sigma projects (Nielsen, 2003). The Cage Factory is a part of the Industrial Division, which has shown an early interest for investigating how Six Sigma could be implemented in the division. Therefore an evaluation of Six Sigma implementation in the Cage Factory is valuable. In a traditional organization the structure is designed to carry out routine tasks. In Six Sigma most activities and problems are unique (Pyzdek, 2003). What is this demanding of the Six Sigma Company? A company that aims for an implementation of Six Sigma also has to consider ongoing improvement activities and systems. Management must therefore plan how overlapping activities should be organized in a way to prevent confusion and reach a positive cooperation between the current system and Six Sigma (Pyzdek, 2003). There is a five years old Total Process Management initiative running at the Cage Factory, which has to be taken into consideration. Other aspects, such as different culture and employee devotion, also have to be considered. As mentioned previously, there are fourteen different production flows in the Cage Factory. The workflow is principally divided into the same main activities. These are shown in Figure 1.4 (main activities in bold font). The figure displays the principle process in the different lines and specifically the flow in Channel 13. -8-
-INTRODUCTION- Raw material Cup drawing: A Piercing: B Notching: C in: Sheet pressing of raw Hole diameter is cut to Roller pockets are - Discs material the right dimensions punched out Bevelling: D Washing: E Turning: F "Bars" are adjusted to Remove superfluous - Correct dimensions for the cage rollers oil - Eliminate non-conformities in surface Blasting: Phosphating: Packing: Delivery: Remove burrs and Surface layer is Packing of complete Customer sharp edges added cages shipment Figure 1.4 Sketch of the workflow in Channel 13 at the Cage Factory, SKF Sverige AB, Gothenburg. There has been an increase of complaints in Channel 13 until October 2003. Most of these complaints can be derived from Turning (activity F in Figure 1.4.). The cages are turned on two sides as showed in Picture 1.2. The two sides of the Cage are called small end and large end. There are both esthetical and capability problems. There are also efficiency losses, in form of downtime, connected to these problems. The use of the five-phase improvement cycle DMAIC4, within Six Sigma companies, has become increasingly common (Pande et al., 2000). Large end of Cage Small end of cage Picture 1.2 Turning surface on large end and small end of the Cage. Source: Own work This particular problem provides an opportunity to further investigate if and how the Six Sigma methodology (DMAIC) and tools can be used successfully in the Cage Factory. 4 The acronym DMAIC is an abbreviation for the five phases in the Six Sigma improvement project, namely Define, Measure, Analyze, Improve and Control. -9-
-INTRODUCTION- 1.3. Purpose and delimitations 1.3.1. Purpose of the thesis The main purpose of this thesis is to evaluate and make comparisons between Six Sigma and the existing way of working and the organization in the Cage Factory. This will end up in recommendations on how Six Sigma can be implemented in the Cage Factory and which actions need to be taken to efficiently work with Six Sigma in the organization. To aid in the fulfillment of the main purpose a practical improvement project will be carried out. In this project the DMAIC methodology will be used. The practical part of the project will deal with quality shortages in the production process concerning the turning device, analyzing the reasons for these shortages and suggesting actions to improve the situation. 1.3.2. Delimitations When studying the possibility of Six Sigma implementation the focus will be on how, and in which form, a Six Sigma venture can exist within the current organization and how a general Six Sigma project can be conducted. The authors have chosen not to study the possibility of implementing Design For Six Sigma, DFSS, at the Cage Factory. This choice was made since the authors have a limited time of 20 weeks to conduct the study. Also, a natural starting point of a Six Sigma venture is the use of Six Sigma in the production and not in the design phase (Professor Bergman, 2003). The practical improvement project will deal with quality shortages in the turning device in Production Channel 13, since there has been an increase of customer complaints in the Channel until October 2003. The authors decided to study only one of the turning devices in one of the production channels because of the complexity of the process and the limited time available. The types that are being produced in Channel 13 during the time of the study limit the types of Cages that will be included in the study. -10-
-INTRODUCTION- The improvement project will be carried out between 2003-10-01 and 2004-01-13. Since the authors have a limited amount of time to conduct the practical improvement project the Control Phase in the DMAIC cycle will not be carried out. This phase need several months of monitoring to be properly evaluated. The authors will instead give recommendations on how this phase could be conducted. The thesis will not take all possible Six Sigma tools into account but a selection of appropriate tools will be used in the different phases. 1.4. The outline of the thesis In this section the outline of the thesis is presented to the reader. An overview of the following chapters is given in Figure 1.5. The figure is also an attempt to present a composition of the thesis to the reader. INTRODUCTION TO THE THESIS Chapter 1 METHODOLOGY Chapter 2 Evaluation of Six Sigma implementation at the Cage THEORETICAL FRAME Factory OF REFERENCE Chapter 4 Chapter 3 Deduction Improvement Project DMAIC ANALYSIS Chapter 5 CONCLUSIONS & DISCUSSION Chapter 6 Figure 1.5 The outline of the thesis. The first chapter gives the reader an introduction to the thesis. The second chapter discusses the methodology chosen to solve the problem. Since the authors have chosen a deductive approach (see Section 2.1.2), the theoretical frame of reference is then presented to the reader in chapter three. Chapter 4 contains the results of the empirical study at the Cage Factory. These results are then analyzed in Chapter 5 and finally, in Chapter 6, the authors' conclusions and a general discussion are presented. -11-
-METHODOLOGY- 2. METHODOLOGY In this chapter the methodology of the thesis is presented. Different aspects of the research approach and research strategy are discussed. The chapter also describes the study of literature, choice of data collection, methodology and chosen tools in the DMAIC project and finally a discussion of the validity and reliability of the thesis. Holme & Solvang (1991) argue that methodology is a tool or a way to solve problems and thereby get new knowledge. Everything that is helping the researchers to reach their goals is methodology. 2.1. Research approach A governing thought within modern science is that research results should be published and used freely to aid the growth of science. Other researchers must be able to review models, methods and results. Are the data valid? Are the interpretations and analyses reliable? Are the conclusions only applicable under certain circumstances or are they of a more general nature? (Wiedersheim-Paul & Eriksson, 1993) 2.1.1. Positivism or Hermeneutics Humans observe the world in different ways and that's the reason why there are different perspectives of science and knowledge. There are two extremes of research directions that are dominating today, namely Positivism and Hermeneutics (Thurén, 1991) The meaning of Positivism is that a science thesis only has a value if it could be empirically verified. Everything that can't be tested empirically, like feelings, values, religious and political statements don't belong to the scientific sphere (Wallén, 1993). Thurén (1991) means that Positivism's only sources of knowledge are observations and logic. The opposite of Positivism is Hermeneutics, which can be translated to interpretation science and origins in theories about bible and other text interpretations. Hermeneutics is about interpretation of meanings in its widest sense (Wallén 1993). This thesis, investigating a possible Six Sigma implementation at the Cage Factory, has got elements of both Hermeneutics and Positivism. Qualitative data is collected through interviews, a focus group and by running a DMAIC project. The authors' interpretations and analysis of these sources of data, founded upon interpretations of existing theories, are examples of a hermeneutic approach. -12-