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Process Improvement: Which Methodology is Best for Your Project?

Process Improvement: Which Methodology is Best for Your Project?. PMI Skyline Luncheon Sharon Valencia, PMP. Agenda. Definitions Business Improvement Methodologies Methodology Comparison Process Management Process Mapping Enabling Project Success. Input. Output. What is a Process?.

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Process Improvement: Which Methodology is Best for Your Project?

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  1. Process Improvement:Which Methodology is Best for Your Project? PMI Skyline Luncheon Sharon Valencia, PMP

  2. Agenda • Definitions • Business Improvement Methodologies • Methodology Comparison • Process Management • Process Mapping • Enabling Project Success

  3. Input Output What is a Process? • Any set of activities that when taken together, transform a series of inputs into an output, producing a result of value to a customer Suppliers Customer Process SIPOC

  4. What is a Business Improvement Methodology? • A documented set of procedures, guidelines, and tools intended to develop better processes • Business improvement methodologies covered in this presentation: • Kaizen • Lean • Six Sigma • Lean Six Sigma • Design for Six Sigma (DFSS)

  5. Kaizen • Defined: Philosophy of gradual, incremental, and orderly continuous improvement, creating more value and less waste; emphasis on process improvement and process control; Japanese word meaning “ongoing improvement” • Objective: Small improvements by optimizing existing systems • Requires: • Taking action on obvious problems and deviations to maintain process control • Establishing control through Standard Operating Procedures (SOPs) • 1-10 days

  6. Kaizen’s Deming/ Shewhart PDCA Cycle Plan Do Check Act Observe and evaluate results to determine if the idea produced the desired results Start with an idea for doing the job better; study the current situation; identify the problem and formulate a plan Conduct experiments to investigate the idea; implement the plan on a small scale If desired results were achieved, implement the change into the SOP * It is also acceptable to use the DMAIC framework for Kaizen events

  7. Lean • Defined: Focus on speed, efficiency, and elimination of waste • Objective: Maximizing process speed (cycle time) by reducing waste • Requires: • Elimination of waste (muda): Defects, overproduction, inventories, unnecessary processing, unnecessary movement of people, unnecessary transport of goods, waiting, designing goods and services that don’t meet customers’ needs • Value stream mapping: Map process and focus on elimination of non-value add activities • Ask what activities the customer is willing to pay for • Focus on process standardization

  8. Lean’s 5s Approach Sort Sustain Straighten Scrub Systematize Keep clutter out of the workplace; Scrub all machines and the work environment to maintain cleanliness Determine what is necessary to perform the job; Eliminate unnecessary items from the workplace Arrange all essential items so that they are clearly marked and easily retrieved Make cleaning and organizing routine; promote an orderly work environment; perform work the same way every time (standardize) Sustain the other steps and continually improve the process

  9. Six Sigma • Defined: Data-driven methodology focusing on reducing defects and variability • 6 σ = 3.4 defects per million (Motorola Shift) • σ = Sigma = Standard deviation • Objective: Reduce variability through continuous process improvement • Requires: • Processes must be in place • The processes must be predictable (in statistical control with normal distribution) • The processes must be improved by reducing variation (continuous improvement) • Data availability • Focus on understanding customer requirements

  10. Six Sigma Distribution Lower Control Limit/ Specification Upper Control Limit/ Specification Normal, Bell-Shaped Curve/ Distribution of Values Defects Defects

  11. Traditional Quality (3 σ: 66,807 DPMO) 54,000 incorrect drug prescriptions per year 40,500 newborn babies dropped each year Unsafe drinking water two hours each month 6 σ Quality (No Motorola Shift) One incorrect drug prescription every 25 years 3 newborn babies dropped each century Unsafe drinking water one second every 16 years The Importance of Six Sigma Source: Institute of Industrial Engineers

  12. DMAIC Framework for Six Sigma Define Measure Analyze Improve Control Analyze the system to eliminate gap between current system or process and the desired goal; determine and reduce obstacles to achievement Define the goals of the improvement activity; determine project’s business case; identify customer; map current & future state processes; determine scope Measure the existing system or process; determine metrics; define project success factors Improve and implement the system or process; determine necessary activities to achieve goals Control the system or process, including risk, quality, cost, scope, change management; determine reporting needs

  13. Lean Six Sigma • Defined: Approach to eliminating waste and variation • Objective: Increase quality and reduce defects/variation while increasing process speed and efficiency • Requires: The combination of both Lean and Six Sigma methods and tools

  14. DMAIC for Lean Six Sigma Define Measure Analyze Improve Control • Integrate the methodologies and tools of both Lean and Six Sigma at each phase

  15. Design For Six Sigma (DFSS) • Defined: DFSS uses tools, training, and measurements to enable the design and development of products, services, and processes that meet customer expectations at Six Sigma quality levels • Objective: Optimize the design and development processes to achieve Six Sigma quality levels from the beginning • Requires: A new product, service, or process to design and develop

  16. DMADV Framework for DFSS Define Measure Analyze Design Verify Link CTQs to features & determine importance; perform process benchmarking; develop, evaluate, and select designs Define the goals of the design act; determine critical to quality (CTQ) characteristics and their relative importance Identify CTQs to be addressed; establish metrics for CTQs; determine how customer satisfaction will be measured Detain selected design; simulate process; ensure design meets CTQs; develop implementation plan Standardize; establish control metrics; develop transition plan

  17. Methodology Analogy Lean Six Sigma Six Sigma Lean Design For Six Sigma Kaizen

  18. Methodology Comparison

  19. Lean and Six Sigma • Lean cannot bring a process under statistical control • Six Sigma does not dramatically improve process speed or reduce invested resources • Combining Lean and Six Sigma maximizes advantages and reduces the disadvantages of each individual approach

  20. Which Methodology is Best? • “Best” is depends by the needs and current state of your organization • “Best” may be a combination of methodologies • An organization ready for Six Sigma is also ready for Lean or other methodologies • The name of methodology used doesn’t matter; what matters is leadership, commitment, vision, strategy, and follow-through from supplier to customer

  21. Business Process Management • The future of business processes lies not in one methodology, but in the integration of technologies and methodologies in order to facilitate execution of the process • Customers are demanding customizations and total solutions • Innovative business processes can lead to competitive advantage • Business processes will drive IT

  22. Changing Competitive Environment • The only thing certain in business is change • Industry boundaries are evaporating • The entire value chain is involved in providing total solutions to customers: • Competition • Collaboration • Partners may also be competitors

  23. Process Mapping • Regardless of the methodology, start with mapping the current processes • Identifies current state, opportunities for improvement, process time • Allows identification of all process steps in order to determine which steps are value added or bottlenecks • Knowing current state will assist in identifying improvement opportunities • As-is vs. future process time, number of steps, handoffs, etc. • Determine steps which add value

  24. Benefits of Process Mapping • Gain understanding of the process and process objectives • Answers who (including suppliers and customers), what, when, where, how, and duration • Identifies the information or data used in the process, decisions, bottlenecks • Identify sources of waste • Improve supplier and customer relations • Provides a common language for talking about the process

  25. Sample Process Map

  26. Internal Non-compliance to Industry Standards Scrap Rework Short Cuts to Beat the System Excess Inventory Capacity Constraints Low Efficiency/ Productivity/Yields Employee Symptoms Shared Responsibility External Benchmarking Company vs. World Class Performers Market Share Drop Negative Publicity Pricing Inflexibility Warranty Costs Indications of Process Improvement Opportunities

  27. Enabling Project Success • Management buy in is required from the start • Align goals with the strategic direction of the organization • Combine project ownership and accountability • Manage change – do it early, do it often • Allocate appropriate staff and time • Train staff in applicable techniques • Eliminate process variation

  28. Experience. Results. Sharon Valencia, PMP Principal Computer Sciences Corporation svalencia@csc.com

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