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  • #29432

    Tracy Sandell
    Member

    I have just been assigned my next project, and I am wondering if anybody has had experience with this type of Six Sigma project or is able to share any advice they might have.
    My goal is to eliminate non-value activities in the Finance and Accounting area (preparing seasonal budgets, monthly projections and variance analysis).  One problem is that so many non-financial executives contribute many hours to this process.  We are looking at optimal number of departments, divisions, etc.
    Any help would be extremely appreciated.
    Thanks.
     
     

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    #75408

    TCJ
    Member

    First define what is value added and non-value added.  Then activity flowchart your process.  Are multiple departments providing inputs?  Who needs the information I am reporting?  Where does the info come from?  Find out where mistakes are made and reduce process steps.  Focus on review/rework loops and eliminate or minimize.  This should get you started.

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    #75501

    Daniel Gendron
    Participant

    Take the time to define your multiple CTQ from your multiple customer.  You may find that there is a lot a customer using financial information for different reasons.  If you list all of them and get what is important for them (Critical To Quality) and then transform those CTQ in a measurable parameter for your project.  Example: Cost per report.
    In your kind of project, this step is much more complex than other project as operationnal where the main focus is cut cost.
    Example: If Overhead cost is a very important CTQ from all your CTQs, you will be more comfortable in reorganising your financial activities and let down some detailed analysis/report used by other groups.
    I hope this help.

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    #75514

    sue
    Member

    Tracy,
     
    We have done extensive work in the financial arena around NVA (non value added) to VA (value added) activities.  My recommendation is to process map using activity based management methodologies the current process of obtaining information and the systems they must access and well as the people they must tap for info.  Each step, estimate the amount of time in action and the amount of time in waiting.  Estimate labor costs based on a job family, like a typical Sales Leader is $60 hr, tier 1 exec is $100 hr, etc.  From this you should be able to roll up an estimate of as is costs. (ie. to forecast sales each month, by region, etc. it costs us $X)  If we could change the process, use this new technology…etc. we could save $X dollars in non valued labor and x days of cycle time by elimination of waiting.
     
    Hope this helps.
    Sue

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    #75522

    Ignacio Jaimes
    Participant

    I have performed several projects in the finance area and based on my experience one of the most important parts in a transactional project is the process map.  In the projects that I hace been involved, nearly 50% of the benefits have come during a very detailed process map sessions.  A low level process map coul  help you identify wich steps are non adding value and to see if there are duplicate transactions at various departments.

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    #75526

    Pipkin
    Participant

    As others have clearly stated, the process map is a main focus.  Consider using a program such as ProcessModel which once filled in will allow you to simulate any options you may come up with.  Just be aware that gathering all the information you need to do an adequate job on a transactional process map is no small feat.  The more detail you obtain, the better your modeling of the process will be and therefor the better simulations you will be able to run.   

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    #100759

    Kubal
    Participant

    Sue,
    Can you share any other information you have on NVA and VA
    I am looking at a 6 sigma project for improving revenue forecast
    rgds,
    Rajiv

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    #100761

    Ron
    Member

    To be value added a process step must meet three criteria:
    1) The customer must view it as having value
    2)It must be done right the first time
    3)It must change to product or service in some manner
    VA is usually less than 10% in most industries
     
    Ron

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