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Creating a Culture of Continuous

Improvement

Engaging and Developing our Associates

Passion for People Development

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Protect Ι Control Ι Sense — A Global Approach

Sense Sensing technologies are increasingly used to support

complex electronic systems

Broad platform of technologies help improve product

performance, comfort, convenience and safety

Protect Today’s sophisticated electronics require greater protection

from ESD, power surges and other occurrences

Handle more power in smaller products

Innovative circuit protection solutions

Control Safely and efficiently control power in even the harshest

environments

Limit equipment damage and minimize electrical hazards

Improve productivity and reduce costs

Founded in 1927

Introduced many innovative,

industry-first technologies

Today

– 10,000+ employees worldwide

– $1.1 Billion in 2016 net sales

– Publicly held: LFUS (NASDAQ)

– More than 40 locations worldwide

Americas

Europe

Asia

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Why Lean?

Site Simplification

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Customers

Did that, then asked, “What’s next?”

A

B

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Growth and Engagement

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Six Change Approaches

1) Education and Communication

2) Participation and Involvement

3) Facilitation and Support

4) Negotiation and Agreement

5) Manipulation and Co-optation

6) Explicit and Implicit Coercion

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John Kotter and Leonard Schlesinger Choosing Strategies for Change, Harvard Business Review, 2008

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Operational Excellence: A Foundational Element of Our Success

Culture isn’t just one aspect of the

game — it is the game. In the

end, an organization is nothing

more than the collective capacity

of its people to create value.

Lou Gerstner, former CEO/Chairman of IBM

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Safety Incidents ↘

Customer Complaints ↘

On Time Delivery ↗

Cash Conversion Cycle ↘

Productivity ↗

Employee Engagement ↗

Talent Management

5-Phase Product Development

Quality Management System

Centers of Excellence

Corporate Social Responsibility

Enterprise Lean Six Sigma

Category Management

Integration Playbook

Information Technology

Sales & Operations Planning

Customer Satisfaction

Flawless Product Introduction

Acquisition Integration

Order to Cash Acceleration

Sustainable Pipeline of Best Talent

Littelfuse Operating System OPERATIONAL EXCELLENCE: EVERYONE, EVERY DAY, EVERYWHERE

STRATEGIC OBJECTIVES PRINCIPAL OPERATIONAL CAPABILITIES RESULTS

QUALITY VISION Zero Defects. Zero Excuses.

CONTINUOUS IMPROVEMENT CULTURE Think Lean. Variation Reduction (6).

CORPORATE VALUES Customer Focus, Results Driven, Teamwork, Integrity, Innovation.

OPERATIONS VALUES Data Driven, Engaged, Forward-looking.

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LF Lean Certification Level Summary

832

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4

Contributor Expert Master

Enterprise Lean Six Sigma Program (Cont’d)

Phase 1 (3 days)

– Site leadership; Gain understanding and support;

Lean assessment

Phase 2 (5 days; includes 2 days of activity)

– Lean basics

Phase 3 (5 days; includes 2 days of activity)

– Value Stream Mapping, Kaizen, Coaching

Phase 4 (5 days; includes 2 days of activity)

– Flow

Phase 5 (5 days; includes 2 days of activity)

– Pull

Phase 6 (3 days)

– Lean Product Development

Other (2 days, 2 weeks, 4 weeks)

– Six Sigma (Yellow Belt, Green Belt, Black Belt)

DL & IDL: 25%, 12 hours (note: some sites have a higher goal)

Professional: 50%, 40 hours

Manager: 100%, 40 hours

Measured over rolling 12 months

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Enterprise Lean Six Sigma Goals: 2017-2020

Certification Targets 2017 2018 2020

Lean Six Sigma

Yellow Belt (all associates) 30% 60% 80%

Green Belt (all professionals) 15% 25%

Black Belt (all professionals) 4% 6%

Contributor [L1] (% of professionals) 40% 60%

Expert [L2] (all professionals) 4% 8%

Advanced Capability 2% 2%

DFSS (% of NPD and Process Development Engineers)

25% 50%

Lean Masters [L3] (all professionals) 0.30% 0.60%

Master Black Belt (all professionals) 0.30% 0.40%

INTERNAL

Yellow Belt Certified: 1506

Green Belt Trained: 206

─ 61 have passed exam

Black Belt Training Wave 1 in progress (17 candidates)

EXTERNAL

Green Belt Certified: 167

Black Belt Certified: 64

Hoshin Kanri

Results

Strategies

Tactics

Metrics

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A3

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Engaging Associates in Data-driven Decision Making:

Yellow Belt Module 1: Introduction

– SPACER

– Yellow Belt Material

– Introductions

Module 2: Six Sigma Overview

– Six Sigma Introduction

– DMAIC Breakthrough Strategy

Module 3: Define

– A3 Project Form

– Voice of the Customer

– Communication

Module 4: Measure

– Data Collection

– Basic Statistics

– Measurement Systems Analysis

Module 5: Analyze

– 7 Basic Quality Tools

– Introduction to Hypothesis Testing

– Process Capability Analysis

– Failure Modes and Effects Analysis (FMEA)

Module 6: Improve

8 Wastes

6S

Visual Management

Total Productive Maintenance

Work Balancing and Theory of Constraints

Kaizen

Cost Benefits Analysis

Module 7: Control

Standardization and Documentation

Introduction to SPC/Control Charts

Mistake Proofing

Control Plans

Module 8: What It Means to Be Data Driven

Data-Driven Culture

Yellow Belt Test

In-class test at end of course

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Why Do A Gemba Walk?

Purpose:

Learn if associates have a deep understanding of why the work they are doing is necessary and important

People:

A walk is an opportunity for leaders to learn how to create a more effective environment where:

– People can do their best work

– People can fully develop their skills and capabilities

– Trust levels can increase

– People feel safe in sharing problems experienced in their work

Problem-Solving Mindset: Recognize Abnormalities

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Phase 3

Area Supervisors are

LSGA Owners • Teams formed by line/cell/shift • Set team’s goal; linked to local x-

matrix • Setup team metrics board • Daily review based on the board • A3 training and coach for LSGA

Leader • LSGA projects: low-hanging fruit

Phase 2 Phase 1

Facilitators Coach LSGA

Teams • Facilitators can be supervisors,

engineers or lean implementers • Facilitators lead and coach team(s) • Facilitator organizes team activities

• Continues until all teams are ready for Phase 3

LSGA Teams are Self Directed • The facilitator provides support as

needed • Teams organize own activities • Higher-performance LSGA Team • LSGA Teams own area:

• Autonomous Maintenance/TPM

• Cell management • Pull system maintenance • Standard work/SOP • Continuous improvement

• Conduct self assessments

Typically 3-6 months Typically 6 months – 1 year Typically > 1 year

Lean Small Group Activity: Three-Phase Development

Global Metric System

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Big-Impact Examples

Measure 1st

Round

6th round

% Change

Floor Space (M2)

-11%

Capacity (K/day)

26%

Output (EA) per year

41%

Productivity (units/hour)

65%

Cycle Time (hours)

-8%

Number of Operators

-18%

OEE

（CLIP 3S） 68% 93% 37%

• 30% yield attempting to produce at rate; improved to 95%

• Applied several experiments to find root cause(s)

Six Sigma: Sensor Product Lean VSM Round 1-6, SBU

Impact: $3.7M / year

Lessons Learned: Ooops

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1 of 4: Part-Time Lean

2009/2010

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2011-present

1%: 100% Dedicated

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95/100

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2 of 4: Operations Only

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Bottom up

Top down HELLO

MY NAME IS…

OPTIONAL

NOT OPTIONAL

3 of 4: Leadership

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If leaders do not already believe in

people development through lean….

Change the people, or change the people

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4 of 4: Advanced Topics Aren’t Advanced

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Phase 1 (3 days)

– Site leadership; Gain understanding and support; Lean assessment

– Hoshin kanri, Leader standard work, Tiered meetings

Bonus Advice: Shakespeare Got It Wrong

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“What's in a name? that which we call a rose

By any other name would smell as sweet;”

William Shakespeare

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Lessons Learned: Successes

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1 of 4: Promotions

“This is how we operate. If you

don’t understand it, how the

heck are you going to lead?”

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Dave Heinzmann, Littelfuse President & CEO

“Associates who want to be promoted

should spend time in the 1%.”

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2 of 4: Support and Flexibility

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Corporate Lean Site Lean Small Group Activity (LSGA)

Dream Team, Suzhou

PICO Tech. Avengers Team, Lipa City

ASP Team, Matamoros

3 of 4: Ownership

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“The machine”

Corporate

training

Global-team-

authored manual

“My machine”

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4 of 4: Outside Validation

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2016: Wuxi 2017: Dongguan, Suzhou

HR Support Need #1

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HR Support Need #2

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Next Steps

Continue to develop the 1% and move them into leadership roles

Support organization’s growth objectives with training as requested

Customer Interaction for Engineers

8D

New Product Introduction

Continue to focus on hoshin/strategy deployment and refine our process

Enhanced functional group support of and participation in ELSS

Design for Six Sigma and path to MBB certification (developing regional expertise)

Additional applications for AME Excellence Awards

Raise the scores on lean assessment 8 or 9 range

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It’s Not Easy

The path of least

resistance....

Ongoing: Acquisition Integration

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Corporate Lean Goal, 2011:

Work ourselves out of jobs

Corporate Lean Goal, 2017:

Develop more great lean thinkers internally

and hire externally when needed

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Ongoing: Global Standardization

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We have a talented lean group…

…take the best ideas and

standardize

“Continuous effort - not strength

or intelligence - is the key to

unlocking our potential.”

Winston Churchill

Ongoing: Training Enhancement

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Lean Boot Camp

2017

It’s not about perfect. It’s about effort. When you make that effort every day, transformation happens. Change occurs.

Someone wise (paraphrased)

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Questions

Questions?

Feedback on our program?

Ellen Sieminski

esieminski@littelfuse.com

773-628-0590

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“To improve is to change; to be perfect is to change often.”

Winston Churchill