What Comes After the Low Hanging Fruit?

admin — Mon, 01 Jun 2009 08:43:51 PDT

What Comes After the Low Hanging Fruit? Making smart choices about lean Six Sigma applications There are four major approaches for organisation wide improvement efforts that fall under the label

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Identifying Six Sigma Projects

admin — Mon, 01 Jun 2009 08:37:51 PDT

How to Identify and Select Lean Six Sigma Projects

Lean Six Sigma is a powerful method for improving existing products, processes and services. Six Sigma was developed by Motorola in 1987. Motorola’s Six Sigma yielded significant financial results and became popular with many other companies, even though Six Sigma was practiced without the benefit of the define, measure, analyze, improve and control (DMAIC) strategy, Black Belts (BBs), or a defined project selection process.

In the mid-1990s, consultants introduced the method to Allied Signal and General Electric (GE), tying improvement to bottom-line financial performance. GE and other organizations refined the Six Sigma method and focused on identifying and selecting key projects, as well as adapting operations-based Six Sigma to service and transactional processes. One way to improve the deployment of lean Six Sigma is to improve how lean Six Sigma projects are identified and selected. The typical approach to lean Six Sigma project identification and selection is heavy on selection techniques but light on identification techniques. There are four prerequisites to a
well executed lean Six Sigma project identification and selection process.

Prerequisite One: Understand The Strategic Plan

The first step in understanding how to identify and select lean Six Sigma projects is to ensure you are completely familiar with your organization’s strategic plan. A typical strategic planning process will involve the following steps:

Planning to plan: Create a roadmap to accomplish the strategic plan.
Values scan: Assess the interests of the stakeholders
Mission formulation: Use the stakeholders’ input to formulate a mission statement.
Business modeling: Create a viable business model, including cultural considerations and funding related to the restructuring or divestiture of existing business lines, as well as the addition of new business lines.
Performance audit: Perform an assessment of the organization in terms of capabilities and financial strength. Success is often based on completing four prerequisites.
Gap analysis: Compare the current performance with the desired state to create a list of gaps.
Integrating action plans: Create and implement a detailed plan to accomplish the strategies of the organization and close any gaps.
Contingency planning: Develop contingency plans to account for potential market changes, competitive pressures and other scenarios that might affect the strategic plan and the organization’s ability to execute it.
Implementation: Deploy the plan throughout the organization via cascaded goals, quantifiable performance measures and clearly identified owners and timeframes. As part of action planning, organizations should launch strategic thrusts to close perceived gaps. Typically, strategic thrusts are initiatives with clear charters and budgets, led by senior executives and involve clear account-
ability. Strategic thrusts might be broad or specific, depending on the perceived gaps. Lean Six Sigma, Six Sigma, design for Six Sigma and their various permutations are all strategic thrusts.

Prerequisite Two: Align, Improve Efforts With Strategy

The second step is to understand how improvement activities should be aligned with the action plans found in the strategic plan. As part of business modeling in the strategic planning step, an analysis likely will have identified where the line of business (LOB) falls with respect to market growth and competitive position. The intent is to determine an effective strategy for a particular LOB based on the rate of market growth and the competitive position for the LOB. For example, if a particular LOB has a strong competitive position in a fast growing market, the management team for the LOB might emphasize product development over operations
improvement. On the other hand, a particular LOB with a weak competitive position in a slow market might require extensive focus on improving the cost structure through lean Six Sigma. For other scenarios, the improvement strategy should be suited to the optimization of each specific LOB relative to its strategic goals.

Prerequisite Three: Understand The Policy Deployment System

The third step is to integrate the action plans into the policy deployment system. Policy deployment is a general reference to goal based plans cascaded throughout the various levels of the organization. Hoshin planning, management by objective and
other terms are varied implementations of policy deployment. Successful implementation of policy deployment involves:

Setting high-level goals, targets, timeframes and owners based on the action plans from the strategic plan.
Setting functional and departmental goals, targets, timeframes and owners based on cascading the high-level goals to the local level.
Integrating the local goals into performance plans for individuals and teams.
Doing regular performance reviews for high-level and local goal achievement.
Integrating performance to goals in the bonus structure for management.

Prerequisite Four: Understand Core Business Processes

Every organization operates in some form as a system that converts inputs (transactions, information or raw materials) into outputs desired by customers (a product or service). The organization will attempt to define processes to create the desired out-
come for customers and ostensibly document those processes. To clarify how to look at process performance for opportunities for improvement, the following terms apply:

Level one (L1) process: A core business process that corresponds to a business function and has accounting traceability.
Level two (L2) process: A subprocess of an L1 process that involves a distinctly related sequence of process steps.
Work steps: A logical work unit of an L2 process that involves a sequence of work tasks and is performed by a person or a small team.
Figure 1 shows an example of the use of the terms. The typical approach to identifying opportunities for improvement is to first understand what the key L1 processes are within the organization.

Then the key L1 processes will be broken down so key L2 processes can be identified. A typical lean Six Sigma
project then will address a sequence of work steps within one or more L2 processes. Project Identification and Selection Process
Champions, Master Black Belts (MBBs) and Black Belts can and should follow a structured method for identifying, prioritizing and selecting lean Six Sigma projects. Initially, the responsibility of a Champion in the project identification and selection process is to assist a trained MBB to execute the following steps:

Review the strategic plan.
Understand the high-level goals and targets for the organization.
Compare desired performance with actual performance for the organization.
Understand the local or depart mental goals and targets for all business functions.
Compare the desired performance with the actual performance for each business function.
Identify key L1 processes based on risk/return/goal analysis.
Understand key L2 processes based on risk/return/goal analysis.
Brainstorm all potential improvement opportunities.
Rank and prioritize all potential improvement opportunities based on risk/return/goals.
Communicate the results of the ranking activity and seek consensus.
Launch lean Six Sigma projects based on the priorities. After becoming familiar with the process, the Champion is expected to lead these steps for the organization on a regular basis. Champion’s Role Is Integral. The role of a lean Six Sigma Cham-
pion is varied and diverse depending on the size of the organization and the scope of the lean Six Sigma deployment. The DMAIC method does not come without the risk of failure, but it is a very successful and proven approach to solving problems and optimizing process performance. The success of lean Six Sigma projects often hinges on the Champion’s ability to resolve organizational issues and manage risks to the project, including:
Funding
Time.
Staffing.
Customer relations
Project size and complexity
Overall structure

How to identify and select a Six Sigma project

admin — Wed, 29 Apr 2009 03:49:40 PDT

How to identify and select a Six Sigma project.

There is usually no shortage of projects to work on in an organisation, in fact there are nearly always too many. However these can be conflicting in both objectives and resources used to carry out these projects.

For example a sales department may be under pressure to convert more business through its sales pipeline, whereas the operations department is struggling to cope with the variety of work. The two departments are not strategically aligned thus creating tension in the business.

So how do you choose the right projects to spend your valuable time and resources on? This article seeks to lay down some general guidelines when selecting Six Sigma projects.

All too often projects are selected based on the immediate pressing need of the organisation - a reactive strategy. This generally deteriorates into a fire fighting downward spiral with most of the time spent sorting out problems and very little time spent managing the strategic direction of the business.

In the same way that strategy should and must drive the selection of projects and programs in an organisation

Winning Support for a Six Sigma Project

admin — Thu, 16 Apr 2009 03:21:04 PDT

Experience has shown that obtaining organisational support for a Six Sigma project is one of the major success factors, and anyone attempting to undertake a project without the necessary support will find it a very difficult and unpleasant task. So what we can we do to ensure we get the support we need? The tool set we [...]

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Planning a Lean Six Sigma Programme

admin — Wed, 08 Apr 2009 02:22:13 PDT

How do we actually make this Lean Six Sigma thing work for us? Once you

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Selecting Six Sigma Projects?

admin — Tue, 17 Mar 2009 02:00:43 PDT

Selecting Six Sigma Projects? Focusing effort and resources to deliver maximum benefits to the organisation Choosing the right six sigma projects is key to the success of an organization in terms of delivery of business objectives, business plan strategies and development opportunities for the workforce. However, there is a cost associated to running six sigma projects that isn

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Creating Sustainable Benefits in Lean Six Sigma using Change Management Process

admin — Mon, 16 Feb 2009 01:47:10 PST

Using Change Management Process to achieve sustainable benefits in a Lean Six Sigma deployment Many companies struggle to get good traction with their Lean Six Sigma deployments. They spend time training Six Sigma Green Belts

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Frequently Asked Questions on Lean Six Sigma

admin — Wed, 04 Feb 2009 02:27:19 PST

How will it benefit me and my company? Despite Lean Six Sigma being around for over twenty years now, it is remarkable that a significant number of companies and individuals still don

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How to influence people with Lean Six Sigma?

admin — Wed, 04 Feb 2009 02:10:15 PST

How Customers demand improvement and people within organizations deliver that improvement through Lean Six Sigma. Influencing people or organizations through the use of Lean Six Sigma employs different tools and techniques depending upon the organization, it

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How to use Value Stream Mapping to select Lean Six Sigma Projects

admin — Mon, 02 Feb 2009 02:35:12 PST

Value Stream Mapping (VSM) is a common tool used by Lean Practitioners to identify waste within a value stream. It is usually carried out in two stages: Current state

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SigmaPro Six Sigma Blog

What Comes After the Low Hanging Fruit?

Identifying Six Sigma Projects

How to Identify and Select Lean Six Sigma Projects

Prerequisite One: Understand The Strategic Plan

Prerequisite Two: Align, Improve Efforts With Strategy

Prerequisite Three: Understand The Policy Deployment System

Prerequisite Four: Understand Core Business Processes

How to identify and select a Six Sigma project

How to identify and select a Six Sigma project.

Winning Support for a Six Sigma Project

Planning a Lean Six Sigma Programme

Selecting Six Sigma Projects?

Creating Sustainable Benefits in Lean Six Sigma using Change Management Process

Frequently Asked Questions on Lean Six Sigma

How to influence people with Lean Six Sigma?

How to use Value Stream Mapping to select Lean Six Sigma Projects