LeanSigma ® Fundamentals

1. LeanSigma® Fundamentals Module 7 – Performance Measurement & Sustainment

2. Lean Sigma has six steps to optimize processes.

3. Why do we need to measure process performance? • Assess / validate the impact of changes to the process: • Process improvement efforts • Organizational changes • Changes to upstream or downstream processes • Changes to supporting systems • Ensure that expected process performance levels are sustained over time

4. Cycle time is commonly used to measure process improvement. • Cycle time is the time devoted to performing process tasks without delays or wait time • A reduction in process cycle time due to process improvements is often used to increase capacity for work performed in other processes.

5. KPIs are critical in sustaining process performance over time • Examples of KPIs include: • Production and delivery timeliness • Query responsiveness • Defect rates • Productivity • Thresholds distinguish “good” process results from results indicating the need for improvement • The process owner is accountable for taking action when results fall below corresponding thresholds • KPI results may reflect process improvements, if available before and after process changes are incorporated

6. We can assess whether we can expect the process to yield consistently acceptable results. • A process capability assessment measures the inherent ability of a process to meet established thresholds or “specifications” • LSL = Lower Spec Limit • USL = Upper Spec Limit • Target is usually the midpoint between the specs

7. The process owner is key to sustaining process improvements over time.

8. Program metrics help us monitor the health and benefits of the LeanSigma program. • Are we achieving our mission to deliver more value to our customers and stakeholders by identifying and implementing measureable process improvements? • Regular Lean governance meetings help us: • Align on priorities and targets • Validate results meet expectations • Ensure support • Mitigate risks

9. Lean program reporting summarizes results across all Lean events. • Cadence • Pace of events by month, department & geography • Benefits • Net EBIDTA savings • Annualized hours saved (capacity redeployed, FTE s) • % improvement cycle / lead time, delays, etc. • Highlights of exceptional events, case studies • Implementation Progress • Percent of identified savings removed from budget • Percent of kaizen action items completed • Cultural entrenchment • Number of employees trained / certified • Number of employees participating in kaizens • Communications 95% of reporting is enabled by web queries against the Lean PMO

10. Sample Dashboard U.S. Events by Month Process Focus to Date n= 110 completed events planned 2011 2012 80.23% of all U.S. kaizen action items completed 2012 U.S. EBIDTA Contribution: $817K *100% of savings realized Annualized Labor Hours Saved = 31,086

11. Case Study: U.S. Market Research Client Support Sponsor: Manny Triggiano Process Owner: Brenda Capobianco Lean Process Lead: Carissa Waltenbaugh Team: Kevin Downing, Chris Davies, Cathy Pileggi-Jefferson, Katrina Kulp, Kyle Burke, Michele Agnoli, Joy Cross, Gerard Avillo, Lisa Cooney, Jeff Northern Key Kaizen Findings 90 Days After the Kaizen Issues Noted Process Changes • A pilot was completed to test the central support pool for smaller clients. • The centralized model went live June 13, 2011. • QMS was enforced as a central information system. • Tier 1 (simple) and 2 (complex) resource pools were created. • Checklists and decision trees were created to clarify info needs. Clients are assigned a CSA even if they call only a few times a year. Pool CSA resources so questions are answered by the first available CSA. Triage client questions and assign CSA resources to a Level 1 pool (simple) or Level 2 pool (complex). Some CSAs less able to handle complex questions. Create a checklist to guide CSAs when refining details of a client’s question. CSAs sometimes call multiple times to refine the client question. Create a decision tree to identify what research is required for a particular question. Improve how info is organized on ARC. CSAs sometimes do unnecessary research.

12. Case Study: U.S. Market Research SupportFindings 15 months after implementation • Results: • The central service center remains in place successfully. • Clients talk to CSAs directly more often. • Very few clients have questioned the change. • Three positions were eliminated. • In addition, the team took on additional work without adding headcount. (SMART roll-out). • Cycle time savings were estimated at 65% initially. The savings observed are about 50%. • Critical factors made the change possible: • Pilot to test client feedback • Excellent communication to the team and clients about changes • Extreme organization and focus

13. Process Priorities – Sample from Operations