1. Edward C. Lai
& Associates
Introduction to
Lean Six Sigma Optimization
(LSSO)
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 1

2. Edward C. Lai
The Burning Platform & Associates
Why do you need to change?
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 2

3. Edward C. Lai
Some Common Burning Platforms & Associates
• Budgets too tight to perform needed tasks
• Increased product or service demands
• Long process cycle time
• Escalating costs
• Dissatisfied customers
• Employees frustrated and overworked
What causes you, your boss or customer to lose sleep?
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 3

4. Edward C. Lai
What is Lean Six Sigma Optimization? & Associates
Lean Six Sigma Optimization (LSSO) is a structured
approach for consistently listening to your customers
and optimizing resources and processes to best meet
the customers' needs. LSSO focuses on the elimination
of waste and the minimization of variability in providing
the best product or service to the customer. Decision
making is based on facts, data and Optimal Thinking®
while results are monitored with the best performance
metrics to ensure maximum success.
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 4

5. Edward C. Lai
Optimal Effectiveness and Efficiency & Associates
• Optimal Effectiveness :
Working on the right thing at the right time
• Optimal Efficiency :
Doing it right the first time
Doing the right thing right at the right time
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 5

6. Edward C. Lai
LSSO Benefits & Associates
• Optimal Cycle Time
• Best Quality
• Lowest Cost
• Best Customer Satisfaction
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 6

7. Edward C. Lai
LSSO History & Associates
• 1930’s : Scientific management (Industrial Engineering)
• 1950’s : Statistical process improvement methods
(Dr. W. Edwards Deming / Bonnie Small)
• 1980’s : Total Quality System (TQS)
Six Sigma (Motorola) (Bill Smith)
Toyota Production System (TPS) (Taiichi Ohno )
• 1990’s : Total Quality Management (TQM)
Lean Manufacturing (Womack and Jones)
Business Process Reengineering (BPR) (Hammer)
Continuous Measurable Improvement (cmi)
• 2000’s : Lean Six Sigma (LSS)
Continuous Service Improvement
• 2009 : Lean Six Sigma Optimization (LSSO)
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 7

8. Edward C. Lai
Systems Concept & Associates
Process
Input Output
Feedback
• Each system has input, output, process and feedback
• Each system has smaller systems inside
• Each system is part of a bigger system
• Systems are inter-related
If any one of the parts is suboptimal,
the whole system is suboptimal.
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 8

9. Edward C. Lai
LSS Examples & Associates
• Federal Express : delivers overnight
• Lens Crafters : Prescription glasses in an hour
• L.L. Bean : same day shipping
• Southwest Airlines : seat assignment at gate
• Del Computers : custom PC in a week
• eBay : lean trading
• Minnesota HMO : sees patients 1 to 2 days of call
• Digital River : software purchase through download
• Delco Electronics : Synchronous workshops in 3 days
• Banking : express tellers, single line/multiple servers
• City of Ft. Wayne, IN : link LSS to city strategy,
improved building permit process 47 to 12 days
Are they optimal? Are they continuously optimizing?
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 9

10. Edward C. Lai
Optimization Types of Optimization & Associates
Continuous
Optimization
Time
Combination
Breakthrough
Optimization
Time
Time
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 10

11. Edward C. Lai
LSSO Process (DMAOC) & Associates
Cycles of Optimal Learning
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 11

12. Edward C. Lai
Some LSSO Tools & Associates
• 7 Common Quality Optimization Tools
– Pareto Chart
– Histogram
– Scatter Diagram
– Line Graph and Run Chart
– Check Sheet
– Control Chart
– Cause and Effect Diagram
• Cycle Time Optimization
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 12

13. Edward C. Lai
7 Common Quality Optimization Tools & Associates
Pareto Chart Histogram Scatter Diagram
Line Graph / Run Chart Check Sheet
Control Chart
Cause and Effect Diagram
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 13

14. Edward C. Lai
Definition & Associates
Cycle Time Optimization (CTO) is an operating
philosophy of maximizing the efficiency of
suboptimal value-added activities while
minimizing non-value-added activities and time
for the best quality, cost and responsiveness
to customer needs.
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 14

15. Edward C. Lai
Cycle Time Optimization Chart & Associates
Value-adding
Activities
Optimal
Non-Value-adding
Suboptimal and
Time
Activities
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 15

16. Edward C. Lai
Some Suboptimal Examples & Associates
Case (1) : Excessive SVA Activities Case (2) : Excessive Queue Time
Value-adding
Value-adding
Activities
Activities
Optimal
Optimal
Non-Value-adding
Non-Value-adding
Suboptimal and
Suboptimal and
Activities
Activities
Case (3) : Continuous Optimization Case (4) : Combination
Value-adding
Value-adding
Activities
Activities
Optimal
Optimal
Non-Value-adding
Non-Value-adding
Suboptimal and
Suboptimal and
Activities
Activities
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 16

17. Edward C. Lai
Principles in Process Optimization Design & Associates
1. Perform activities in parallel as early as possible
2. Set up common priority system
3. Minimize variability in the system
4. Minimize queue time
5. Minimize suboptimal and non-value-adding activities
6. Optimize value-adding activities
7. Minimize errors (Do it right the first time)
8. Detect errors at the source
9. Set up feedback system for timely corrective action
10. Set up optimal process-oriented performance metrics
and measurement system
11. Perform best process failure mode and effect analysis
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 17

18. Edward C. Lai
Root Cause Analysis & Associates
Areas to consider :
• People
• Process
• Equipment
• Material
• Measurement
• Environment
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 18

19. Edward C. Lai
Cycles of Optimal Learning & Associates
Optimization
Focus, learning and continuous optimization over time produces the best results.
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 19

20. Edward C. Lai
Summary & Associates
• Lean Six Sigma Optimization (LSSO) comes from
a long history of improvement experiences
• Key focus: customer, results, systems concept,
processes, tools, facts & data, people with Optimal
Thinking® as a core
• Optimization can be continuous and breakthrough
• DMAOC: LSSO process for cycles of learning
• Many LSSO tools: just-in-time training on projects
• Focus, learning and continuous optimization over
time produces the best results
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 20

21. Edward C. Lai
& Associates
For more information on Lean Six Sigma optimization,
please contact :
Ed Lai
310-365-0629
elai001@aol.com
© 2009, Edward C. Lai and Associates. OPTIMAL THINKING® is a registered trademark of The World Academy of Personal Development Inc. All Rights Reserved. Page 21