Tuesday, March 17, 2015

ECBC Analyst Uses Lean Six Sigma Black Belt Skills to Reduce CASARM Surveillance Costs

 Sometimes routine and habit can keep even the best scientist from seeing a cost savings right in front of them. As Steven Lagan, a new operations research analyst in the Modeling Simulation and Analysis Branch, discovered this is exactly where Lean Six Sigma training comes in handy.

 Lean Six Sigma is a management approach for problem solving and process improvement based on a combination of the different tools of Six Sigma and Lean Manufacturing. Six Sigma is a strategy first created by Motorola in 1986 that involves creating groups of people in an organization who are experts in process analysis, and through a set of steps can allow them to create products virtually free from defects. Lean Manufacturing involves a never-ending effort to eliminate or reduce waste, or any activity that consumes resources without adding value to the manufacturing process.

 “I was about to begin four months of Lean Six Sigma Black Belt training over the summer, and I needed to find a project to complete the requirements to actually become a black belt,” said Lagan. “ECBC’s Quality Manager, Sue Procell, suggested that I do a financial analysis of our agent sales. Analyzing our prices quickly led me to examining all our costs incurred to produce it, which led me to the amount of surveillance we perform to ensure its quality, and how we select the agent vials from our stocks for sale to other authorized labs for testing .”

 “We sell both CASARM (Chemical Agent Standard Analytical Reference Material) and non-CASARM agent. When a new lot of CASARM agent is created, it is immediately vialed. The non-CASARM lots are stored in bulk and vialed only when we have a sale for it,” he explained. “Because the CASARMs aren’t always in the vials that customers want, it’s harder to get them off the shelf. Some agents might have remnants of eight to ten lots sitting on the shelf. More lots mean more inventory work and more surveillance tests. On the other hand, the non-CASARM lots only keep one lot in stock at any time, and customers are always guaranteed to get the vials that they want. The non-CASARM approach was obviously doing a better job of keeping costs low. The question was whether the non-CASARM approach could keep the agents as pure as the more controlled CASARM procedures.”

This is where Lagan’s Lean Six Sigma training came in. “Using a statistical method known as a linear regression, I looked at our surveillance data for both the pre-vialed CASARMs and the non-vialed non-CASARMs and found an inconsequential difference in how pure they remained over time. If purity could be maintained at a fraction of the cost, it made sense to adopt the simpler and cheaper method.”

The potential savings did not end there. “I also observed that we could take more care to select agent for sale to these labs from our smallest lots so that fewer lots could be kept in stock. Again, fewer lots means fewer surveillance tests,” said Lagan. Lagan then made two recommendations to Procell and his branch chief, Mike Kierzewski. First, apply the same procedure used for non-CASARM agent of not vialing it until it is sold, to CASARM agent, too. Second, systematically select agent from the smallest lot first so that there will be fewer lots to perform surveillance on.

The biggest challenge of applying Lean Six Sigma to real-world business problems, according to Lagan, is finding the middle ground between what the Lean Six Sigma methodology tells you is the optimum solution and what the organization doing the process can actually take on. “In this case, the things that needed to be done differently actually made for less work – plus a 50 percent savings in our surveillance process - making this a very good outcome from both standpoints,” Lagan said.

Asked when Lean Six Sigma should be used, Lagan used the analogy of a headache. “If you only get a headache every now and then, taking a Tylenol is sufficient. However, when the pain from them becomes too severe, you need to go beyond symptom management and find the root cause. If the root cause can be identified, maybe the pain can be taken away permanently. Similarly, if you have a process that comes with excessive costs, unacceptable delays, or an inability to consistently meet the needs of the customer; it's probably time to bring in a process improvement expert who can help identify the root causes.”

Lagan sees a lot of applications for Lean Six Sigma analysis at ECBC. “Anytime a process has problems with speed, cost, or quality, it can be benefited by the Lean Six Sigma methodologies. Most problems won't require a full Black Belt-level project. They may only require the application of a couple of tools from the Lean Six Sigma tool kit,” he said. “The Lean tools are typically aimed at the elimination of waste, which results in faster and cheaper processes, and the Six Sigma tools are aimed at increasing quality and reducing variation, which results in decreased costs and increased customer satisfaction.”

2 comments:

  1. Great thoughts EdgewoodChemBioCenter . Focus on process improvement and developing people instead of results only.This takes time. Also, leaders need to live the lean philosophy and not hand improvement off to others.
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