Abstract Lean and Six sigma methodologies across all

Topics: BusinessManagement


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Last updated: September 30, 2019

AbstractThispaper outlines Lean and Six Sigma implementation by JEA, a community-ownedelectric, water, and sewer utility company serving over 305,000 water, 230,000sewer, and 417,000 electric customers in Northeast Florida and Jacksonville. Themain objective of JEA as a company, was to improve productivity and profitmaximization but at same time ensure implementation of processes to addresssafety and environmental concerns. The paper further discusses pre-Lean andpost-Lean transition of various projects executed by JEA. This write up alsoanalyzes methodologies such as DMAIC, DMAGIC, 5S, Root cause analysis,multivariate regression analysis implemented by JEA, which not only improvedJEA’s productivity and profits but also improved customer satisfaction and relations.Keywords:Lean, Six Sigma, DMAIC, DMAGIC, 5S, Root cause analysis, multivariateregression analysis.            introduction Thecase study of JEA, a community-owned company, deals with the story ofimplementation of Lean and Six sigma methodologies across all the projects whichnot only increased productivity and profit but also ensured every projectaddresses environmental issues. With an aim of improving productivity and profit, JEA adoptedLean and Six Sigma methodologies in 1999 with Black Belts training in 2000.Implementing its first Six Sigma projects in 2001 and integrating Lean and SixSigma approaches in 2007, JEA has successfully completed over 580 improvementprojects.

In 2008, JEA modified Six Sigma DMAIC process by introducing “Greenit up” step making it “DMAGIC”, which served as the backbone for JEA’s processimprovement success for various projects. For every project-specific goals aredefined, data is collected, analyzed for root causes and “green it up” phase isperformed before introducing improvement and control countermeasures. Thisapproach ensures that every improvement process considers environmentalconcerns in addition to productivity and cost reduction.Byvirtue of Lean and Six Sigma implementation from 2001 to 2010, JEA accomplishedutility-wide cost savings of $579 million, which was an average of $950 savingsper customer. In addition to this, the rate increase of $20 per monthassociated with process improvements efforts was avoided.

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JEA also avoided rateincreases of $20 per month related to process improvements. As of 2010utility’s budget, JEA avoided the impact of $95 million from projects targetedfor cost reductions. The paper also analyzes Lean and Six Sigma processimprovement success for various projects.

   NitrogenDischarge Reduction Project: St. Johns RiverProblem: Nitrogendischarge in St. Johns River was found fluctuating with lowest nitrogendischarge on Friday evenings and high discharge level each weekend reaching itspeak level on Monday morning which later dropped throughout the week. Thisfluctuating pattern had a negative impact on the monthly nitrogen emission datasubmitted to the Florida Department of Environmental Protection.Solution by JEA: DMAGIC            After analyzing varying nitrogen emissions at varioustimes in the week, JEA’s project team identified root causes and implementedprocess to reduce high nitrogen emissions without disturbing plant operations.

The root causes which were identified were air flow, dissolved oxygen, effluentbiological oxygen demand (BOD), food to microorganism (F/M) ratio and watertemperature. After performing multivariate regression analysis, it wasconcluded that fish processing facility halted operations on weekends causingmicrobes to die and thus spiking nitrogen emissions each weekend. JEA’s projectteam developed the hypothesis that microbes could be fed with methanol andglycerin byproducts biodiesel production which was previously part of Lean SixSigma project in 2007. Working with the city of Jacksonville, JEA reclassifiedbyproducts from biodiesel production as Nitro-Gone, previously considered as ahazardous waste. Nitro-gone is fed to microbes in the weekends thereby reducingnitrogen emissions in the river.

The high-temperature side streaming processwas introduced enabling super microbes to endure 106 Degrees Fahrenheitconditions thus achieving improved ability to reduce nitrogen emissions intothe river.            The proposedsolution by JEA, reduced nitrogen emissions in the St. Johns river by 74 tonsper year. Owing to DMAGIC approach, JEA was able to comply to new federalstandards for nitrogen emissions with reduced operational costs and without theneed of investing in new treatment technologies. The project aided JEA inaccomplishing savings of $2.37 million per year from nitrogen credits alsohelping customers save $6.57 per year avoiding expenditures.

JEA’s successfullyproposed solution to address the reduction of nitrogen by recycling byproductfrom biodiesel process, which indirectly aided in the environmental cause ofreducing material entering landfills each year. The project increased cooperationbetween JEA and local municipalities and also improved public perception ofJEA. The process improvement approach implemented by JEA for this particularproject is in accordance with NSPE code of Ethics that “Engineers are encouraged to adhere to the principles ofsustainable development in order to protect the environment for futuregenerations.

” Safety and EfficiencyImprovement- Water Maintenance TrucksProblem: In thefiscal year 2005, Ford F-550 trucks used for maintenance of waterinfrastructure in Jacksonville, Florida recorded three safety mishaps with onefirst aid incident. Also, the average time required to complete a watermaintenance task was 78 minutes.Solution by JEA: 5S            With the use of methodologies such as root causeanalysis, X-Y matrix, direct process observations, ‘five whys’ questioning, andPareto charts, JEA’s project team identified two factors for the increase inmaintenance time. The identified factors were improper material locationmanagement and difficulty to get material off the maintenance trucks. JEAimplemented the 5S process which helped in the proper management of bins andmaterials on trucks, notebooks with pictures and descriptions for each item,and labeling and magnetic signs for bins and compartment bins. To ensuresustainability of the proposed system, JEA’s project team proposed a frameworkwhich included random inspection of trucks by the Safety Health AwarenessPromotion an Education (SHAPE) representative and managers, approval of newitems on trucks by committee, responsibility on crew leaders and trainees forproper conditions of trucks, highlighting concerns in monthly safety meetings.

            The proposed5S framework by JEA ensured safer environments for employees with zero OSHArecordable mishaps and vehicle accidents. The process improvement approachimplemented by JEA for this particular project is in accordance with NSPE codeof Ethics that “Engineers shall hold paramount the safety, health, andwelfare of the public.”The average completion time for the maintenance trucks was minimizedfrom 78 minutes to 55 minutes. Due to light weight trucks, fuel cost wasreduced by an estimated 10% per truck. Lean project implementation allowed 479more jobs per year. Jobs per crew day also saw an increase, from 4.36 to 6.23respectively.

 Sanitary Sewer Overflows: Process ImprovementsProblem:In 2002, 43 sanitary sewer overflows issues were reported which were a majorconcern for JEA. It was observed that over 20 percent SSO’s occurred in ductileiron pipes.Solution: Six Sigma and Data-driven approach            With the implementation of Six Sigmaand data-driven approach, JEA successfully reduced SSOs occurring in its pipelineinfrastructure. JEA ended up replacing ductile iron pipes and in June 2010,SSOs were reduced to zero, with only 30 SSOs occurring between October 2009 andSeptember 2010.  Conclusion             The above successfully resolved project examplesprove that the proposed solutions by JEA, implemented all Lean and Six Sigmatools such as DMAIC, DMAGIC, 5S, Root cause analysis, Pareto charts whichensured feasible solutions to the problems and adhered to the NSPE Code ofEthics.

The company not just gave solutions to its customers but ensured thatthe proposed solution improves productivity, reduces wastes, increases profitsand considers environmental benefits making them Green solutions. Empoweringproject teams with Lean and Six Sigma tools, JEA continues to provide to cost-effectivesolutions to its customers with improved productivity.                     

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