BPMS 06 Gap Analysis

CustomerFocusedSixSigmaGapAnalysisBusinessProcessManagement6-2ServiceQualityCostDeliveryDistributorInternalOEMUserCustomerExpectationsWhatarethemajorcustomerexpectations?CriticalIssuesSpanUnits&ScaleProcessOutputMeasureCTCIssuesWhataretheOperationalDefinitionsofCTCIssues?CustomerSpanWhatdoCustomersSee?ScorecardstoManageResultsIndicatorsofProcessPerformanceCoreandEnablingProcessesCritical-to-CustomerOutputsCustomerFocusedObjectivesCSIPOCrossFunctionalMappingWhatisProcessthatproducesCTCOutputs?AverageWeightPerConveyance05000100001500020000JulyAugustSeptemberOctoberNovemberDecemberMonthWeightperConveyanceScorecardsWhatwillbemeasured?GapClusterClusterProjectProjectProjectProjectSixSigmaProjectsWhatprojectsareneededtoclosethegaps?•Whatarethekeymeasuresofprocessperformance?•WhatarethegapsbetweenprocessperformanceandCTCobjectives?6-3Whatdoyoumeasure?Y=f(x1,x2,…,xn)•WhataretheY’s-measuresoftheoutputsofyourbusinessprocess?–Y’sareimportanttoyourcustomerortheyaredirectlyrelatedtowhat’simportanttoyourcustomer•WhataretheX’s-measureswithinyourbusinessprocessthatcorrelatetotheoutputmeasures(Y)–Internalanduncontrollable–Internalandcontrollable6-4WeareSeekingtheDriversofProcessImprovementY=(x1,x2,x3,x4,…xn)ProcessProcessEffectiveness(Outside-In)ProcessEfficiency(Inside-Out)and6-5MetricCategoriesProcessEffectivenessProvidesRequiredFeaturesFreedomfromDeficiencies•Defectrate•Accuracy•Actual/Plan•DeliveryOn-Tome•Timeliness•ResponseTimeProcessEfficiencyEffectiveatLeastCostCompetitiveAdaptabilityEffective&EfficientIntheFaceofChange•CostPerTransaction•TimePerActivity(CycleTime)•ProcessYield•OutputPerUnit(Space,FTE,Time)•TotalCycleTime•SetUpTimeForNewCustomerNeeds•CycleTimeforSpecialCustomerRequests•PercentageofSpecialRequestsNotMet6-6Measuresprovideabasisfor:•Specificallycommunicatingperformanceexpectationstoteammembers•Quantifyingwhatisreallyhappeningintheorganization•Identifyingperformancegapswhichshouldbeanalyzedandeliminated•Effectivelymakingandsupportingdecisionsregardingresourceallocationandactionplanning6-7HierarchyofProcessMeasures•Level1:ExternalCustomerMeasures•Level2:InternalEndofProcessIndicators•Level3:MetricsatKeyJuncturesorMilestonesofProcess•Level4:SteporActivityMeasures6-8HierarchyofProcessMeasuresCUSTOMERFUNCTIONAFUNCTIONBFUNCTIONCM3M2M2M3M1-internalM1-externalM1-ExternalCustomerRequirementsMeasuresrelatedirectlytocustomerrequirementsM1-InternalEndofProcessMeasuresreflectcustomerrequirementsaswellasbusinessrequirements–theseareend-of-processmeasuresM2Sub-ProcessMeasuresoutputofsub-processesand/orfunctionsM3KeyProcessStepMeasuresoutputofspecificprocesssteps6-9HowtoDevelopProcessMeasuresOUTPUTCRITICALDIMENSIONMEASUREGOALTRACKINGDEVICE12345IdentifysignificantoutputsIdentifycriticaldimensionsDevelopmeasuresforDevelopgoalsforeachDefinethetrackingdevice(endofprocess,sub-process,foreachsignificantoutputeachcriticaldimensionmeasure.ThegoalshouldanddatasourceforeachJob)represent“entitled”performancemeasureEXAMPLEContractpreparedAccuracyTImelinessNumberoferrorsrequiringreworkTimefromagreementmadetocontractprepared03workingdaysContractreworknumbersContractprint-outdatesBooksshippedQuantityTimelinessAccuracyShipmentvolumeperdayNumberofon-timeshipmentsNumberofshippingerrors15,000perday95%ontimeDailyshippingreportBillingerrorreportBillingerrorreport06-10ProcessMeasurementChartM1-ExternalTrainingmaterialCRITICALDIMENSIONINPUTMEASUREGOAL*Accuracy*TimelinessM1-InternalOUTPUTCRITICALDIMENSIONMEASUREGOALTrainingMaterial*TimelinessM2sSUB-PROCESSOUTPUTCRITICALDIMENSIONMEASUREGOAL*Timeliness*Timeliness*TimelinessM3sPROCESSSTEPOUTPUTCRITICALDIMENSIONMEASUREGOAL*Timeliness*Timeliness6-11•Reviewyourcoreprocessmap•EstablishmeasurementsofprocesseffectivenessthatlinktoCustomerCTQ•Establishgoalsforprocesseffectiveness•QuantifythegapsbetweendesiredandcurrentperformanceStep1:GapAnalysisforCustomerExpectations–ProcessEffectivenessUseGapAnalysisTable6-12ClosingBooksProcess(Monthly)SalesResourcemgtPurchasingMfgR&DHRAccountingStaffFinanceTIMES/OProductionPlanCriticalY:FastdeliveryofmanagementinformationCustomer:ManagementRequirement:4days(As-Is8day±2days)MRP(Estimatematerialconsumption)P/OMaterialSourcingProduction→ITCProductShippingProduct/MaterialinventoriesCalculatematerialcostClosingprocessinputandoutputDDCalculatelaborcostCalculateexpenseCalculateoverheadcost①②Closingbankaccount③D+3daysDdayX1X2SamsungExample6-13ClosingBooksProcessSalesResourcemanagementPurchasingMfgR&DHRAccountingStaffFinanceTotalCalc.Productcost②①ClosingsalesEstimatesalesprofitCalc.OtherexpensesEstimatefinancingcostEstimatepre-taxprofitB/L,P/LverificationEND③D+6daysD+7daysD+8daysProfitinwonFinancialreportD+5daysX3X4X5SamsungExample-continued6-14ProcessOutputInternalProcessMetrics(CycleTime)Baseline(X)GoalGapYQuickmanagementinformation(FinancialReport)x1:ClosingsalesX:D+6R:±2X:D+3R:±12hr3days36hrx2:ClosingprocessinputsandoutputsX:D+3R:±1X:D+1R:±12hr2days12hrx3:EstimatemanufacturingcostX:D+4R:±1X:D+2R:±12hr2days12hrx4:EstimatefinancingcostX:D+5R:±2X:D+3R:±24hr2days24hrx5:B/S,P