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Which Processes should be Improved?

Six Sigma – iSixSigma Forums Old Forums General Which Processes should be Improved?

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  • #43613

    Khalil Stephenson
    Participant

    I am on a project team selected to conduct a process review and redesign of a small savings and loans financial services company.
    The scope of work is to improve the customer-facing processess, as well as, high-cost processes. Given the scope, time and budget does not allow for all processes to be improved and all processes may not be inefficient.
    How do I determine which processes should be improved. Should a parteo analysis be conducted to identify the main ‘points of pain’? Any feedback would be welcome, thanks.

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    #138555

    EdG
    Participant

    A pareto of our pains would be a good start.
    Another might be to do a comparison of Benefit (savings???) vs Effort.  You know, the ones with the smallest effort and biggest return would be what you want to “cut your teeth on” before you try to tackle the really tough stuff.

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    #138559

    Elbrin
    Participant

    Follow up questions:

    Has your leadership provided clear goals (e.g. $XX cost out, Decrease cycle time by X%, Reduce defects by X%?) If so base your pareto on these.
    What current data sources are available that you can leverage?
    Are there business units that are more willing partners than others?
    Are there any quick hits that would not require the full DMAIC method to accomplish?

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    #138560

    Freddy J
    Participant

    Khalil:
    I would focus on the processes/process steps  that are creating the greatest financial pain as well as the ones where you are encountering the most variation. A Pareto Analysis would help with this as well as a Quality Function Deployment tool comparing the relationship of the high-level process steps to the critical to quality (CTQ) issues.

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    #138563

    Romel
    Member

    For the customer facing processes, identify first what customer needs (Ys – time, quality, cost) have low performance over time — use a trend chart, hypothesis tests, and correlation to prioritize
    For the high cost processes – you can use bar charts, pareto
    Then prioritize whether the problem in customer facing or high costs should be given emphasis. there’s a possibility that the problem can be the same.
    If you wanna come up with a criteria focus on the process which gives a big impact on customer and cost, does not require too much complexity when improved, less cost and risk upon implementation and in the shortest possible time

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    #138567

    McD
    Participant

    For the customer facing processes, identify first what customer needs
    Sheesh.  I can’t believe romel is the first one in this thread to mention the customer.
    The customer stuff is a lot harder to get a handle on than the costs, but it is key to the bank’s success.  Certainly look at costs, and look at processes that have variation, but don’t forget what your customer needs.
    –McD
     

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    #138570

    villageidiot
    Member

    You have a basic problem of project assessment and selection, and apparently no steering committee or established proejct selction criteria to accomplish this…your screwed….OR you could look at it like this: 
    You have to basic metrics involved here:  CTQ and Cost reduction.  I would prioritize your CTQ issues based on customer value propositions and then QFD and/or Kano their requirements…you know, ye ole VOC… {Note:  all customers were not created equally…the ones that pay more (grosss unit margin), buy more (volume) more often (frequency), more regularly (stability…ahhh, the joy of min variation)  have greater value}…start with those that have the greatest impact on your P&L, identify and prioritize their requirements, and assign 6S resources accordingly.  I would prioritize your cost reduction efforts based on, ummmm……costs.  Rack and stack em and then assign your Lean resources.  ROI works here if required project investments differ….NPV if project outcomes result in differing return intervals….I break out the two skill sets only to add clarity for determining project time lines, project budgets, and scope estimates.  Good luck and remember…what the hell do I know…

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    #138599

    CB
    Participant

    Khalil,
    That’s a easy one, go after the “low hanging fruit”,  remember the 80/20 rule, 20% of the problems yeild 80% of the answers.
                      Good luck
                                CB
    JUST REMEMBER QUALITY IS EVERYTHING

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    #138623

    worksimp
    Member

    Khalil,
    Lots of good ideas.  I’d suggest you ask a few questions before you start.  Which customer-facing processes are a concern? Why?  What are the high-cost processes?  Which are a concern? Why?  A little upfront work can help you narrow the scope considerably and start out on target without second-guessing what management really wants (There’s a good chance they don’t know what they want and good questions will get them thinking about it).

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    #138626

    Mike Carnell
    Participant

    Khalil Stephenson,
    “I am on a project team selected to conduct a process review…..”
    Since you were selected to do a “review” and you don’t know which processes are to be improved isn’t that the point of the review? Since you were selected to do a project you don’t know how to do perhaps the management doesn’t really want it done? I would think it would better serve you to either tell them you are not qualified or to get advice from someone other than anonymous posters.
    If you are a Black Belt and are asking this question you need to turn in your certification. Given that you probably will not do that, as a couple of posts have stated you begin with the customer and their wants, needs and desires. It is the basics to establishing CTQ’s.
    “Given the scope, time and budget does not allow for all processes to be improved and all processes may not be inefficient.” This is an interesting statement from someone who works for a financial institution. They have so little understanding of their costs and where their revenue comes from that they have a time constraint on improvement? This whole things smacks of window dressing and the last thing people need is one more insincere person handling their money.
    Just my opinion.

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    #138638

    Khalil Stephenson
    Participant

    Mike,
    Thanks for your reply and you may have misunderstood a couple things.
    I am currently at the Green belt level as I have worked on a few six sigma projects in college. On these projects, it was always specified which process or processes should be improved. Once the process was established then the DMAIC method was followed.
    Though I am very pasionate about quality and six sigma, my firm has not embraced the methodology. Nonetheless, I have tried to use my limited experience of the six sigma tools and methods to guide me on the engagement-I’m just at an analyst level!
    The Project Sponsor has requested that we review all customer facing and high cost processes and rank those that may have the biggest impact. However, several customer surveys were done and based on the results customers were mainly satisfied with the service. Where then would the VOC come from?
    Mike, you seem as though you have had several years of experience working on six sigma projects and maybe you still are, but there are others who lack the experience, have the passion for quality but just haven’t gotten an opportunity to work in an environment to further develop their skills. I’m sure you were once a Greenbelt and had lots of questions!

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    #138639

    Khalil Stephenson
    Participant

    Hi worksimp,
    Thanks a lot for your suggestions. The challenge on this assignment is that customer surveys haven’t identified any major dissatisfaction, so I wasn’t sure how the VOC would be ascertained.

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    #138641

    Khalil Stephenson
    Participant

    Thanks for the feedback McD and quality does indeed start and end with the customer. However, in this particular instance customer surveys didn’t reveal any major ‘points of pain’, so I wasn’t sure where to start.
    This particular financial services company has been losing market share to another competitor and sees a need to improve its internal operations to become more competitive, however, with the VOC being satisfied then maybe a Lean approach should be used to reduce costs.
    Let me know your thoughts

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    #138648

    Holden Caulfield
    Participant

    That kills me when phony blackbelts act so all important and stuff and then they don’t even ask the right questions when they ask a question.  They’re always doing that.  It makes me want to stand up to them and tell ’em what I think about them being all phony, but I probably wouldn’t even if I had the chance.  ‘Cause I’m all weak.  I’m a little small for my age.  But there’s something so sad about phony blackbelts trying to be all high and mighty and important and stuff and you can’t help but notice how sad it all is.  It makes me so depressed sometimes that all I want to do is sleep.  When I saw that phony blackbelt stuff I started crying.  Honest, I did.  Just for a minute.  Then I fumbled for a smoke, but my hands were so cold I dropped the matches in the snow.  That’s when I got the idea to call old Jane.  So I went to the phone booth across the street, but when I got in there I guess I wasn’t in the mood to call her.  Mostly since her mom might answer.  I wondered if those nuns with the basket might’a been blackbelts.  But if they were, I’m sure they weren’t the phony kind.  It was getting kind of late, so I got a cab. 
    Holden

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    #138651

    McD
    Participant

    Khalil:
    customer surveys didn’t reveal any major ‘points of pain’
    losing market share to another competitor
    OK, this is a horse of a different color.  And if, as Mike suggests, much of this is window dressing, you are in for a tough road.  As a Green Belt in a company without a strong SS culture, you are in for an uphill battle already.  Hopefully your management is open minded and interested in improving the institution.
    A simple survey to your customers isn’t going to do it for you.  Someone out there is doing a better job than you.  At best, you would like to gain back some of that market share.  As a minimum, you want to improve inefficient processes without accelerating the loss of market share.
    What you need to do is to get at the shape of your Kano curves.  The common way to do this is with a conjoint analysis.  That sounds pretty simple, but in practice, especially with customer-facing processes, it is a big, expensive deal.  If you want meaningful results you will probably need to use some sort of market research firm, and that stuff can get expensive.
    Once you know what the Kano curves look like, it will be pretty evident what to go after.
    But unless you are content with continuing to loose customers, I can’t see a lot of alternatives.  If you don’t know what they care about, then even seemingly harmless improvements could hurt badly.  And obviously they care about something, because they are going somewhere else to get it.
    –McD
     

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    #138654

    Mike Carnell
    Participant

    Holden,
    Your post has a very familiar ring to it. Try the zolft.

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    #138655

    Mike Carnell
    Participant

    Khalil Stephenson,
    Actually you are making a point I have tried to make for a while now. Delivering a deployment is different than doing a project. Thank you.
    If you surveyed the customers you have they should generally be satisfied. How many of the ones that have recently closed accounts did you contact? The other issue may be time. How much time has passed since they did a transaction and the time you asked them what they thought?
    There are other customers as well such as the government, auditors, and of course any one who has taken you to court. It is all customer feedback.
    The next question is do you want satisfied customers or do you want delighted (I hate that word but it the one commonly used) customers? How much effort does it take to get a satisfied customer to leave your company versus a delighted customer?
    Try looking at QFD as was earlier suggested. Maybe you don’t have the time to do the entire thing but it will give you some guidance to how to evaluate the trade offs and prioritize. I am surprized that someone hasn’t suggested one of those weak methods like multivoting but stick to numbers.
    Before you start any of this make sure what you select can have the results tracked – know it before you start.
    When all else fails put it into the context of Y=f(x). If you want a fast hit get the cost thing going. It is easy to figure out what your biggest cost is. Hit it fast and take out some cost (because your accounting system will be able to quantify it and track it). It will get everyone to settle down for a while and it knocks some of the fence sitters off the fence and it is easy.
    Just my opinion.
    Good luck

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    #138658

    Dooley
    Participant

    A QFD and a Value Stream Mapping and analysis would go a long way in revealing what to choose…

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    #138662

    Ben B Graham
    Participant

    Khalil,
    Did management indicate there was dissatisfaction?  That may not be their concern – or they may (and likely do) know things that the survey didn’t address.  Since they asked you to focus on two areas, ask why?  When they tell you, ask why to what they tell you.  I’m not suggesting that you be obstinate, but be analytical.  In the words of Charles Kettering, “A problem well-defined is half solved”.    It is management’s place to provide direction and the analyst’s place to understand the direction.
    Ben B Grahamhttp://www.worksimp.com

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    #138665

    Mike Carnell
    Participant

    Dooley,
    Agreed.
    I would hope there was some type of mapping activity before they did the Survey so they could identify the customer touch points. Then they would know what to ask about in the survey?
    Good input. Thanks.
    Regards

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