Process Improvement Model

Transcript

FICCI CE Process Improvement model FICCI CE Process Improvement model 2. Application of Process improvement Principles 1. F E E D B A C K L O O P Operational Analysis of process Who, what, how & where 3. Benchmarking 4. PDCA FICCI CE Process improvement principles 1. Waste Reduction Process Improvement Principles 2. Process Simplification 3. Cycle-time reduction 4. Process measures 5. Mistake - proofing FICCI CE 1. Waste reduction The first step in improving a processes is to eliminate waste with the following techniques :I. Value-added assessment II. Eliminating non-value adding activities III. Minimize checks and inspections IV. Minimize administrative tasks V. Minimize storage and transportation activities FICCI CE I. Value added assessment Value to customer : First, the customer’s view point should be considered. The customers are only interested in receiving the product or service that satisfies their requirements. All activities that must be performed to cater to the customer’s requirements are value -added activities. FICCI CE Does the activity add value to the customer ?  Would any customer care if the activity was not performed ?  Would any customer object if the activity was not performed ?  Do the customers appreciate the results of the activity? FICCI CE II. Eliminate non-value adding activities Value to business : There are many activities that may not add value from the customer’s point of view. Attending meetings, developing plans, compliance with regulatory guidelines, writing procedures etc are examples of activities that may not add value to the customers, but they do add value to the organization. Each of these activities must be carefully examined. FICCI CE III. Minimize checks & inspections • Checks and inspections may be necessary in a process, however they do not add value to the process. Each inspection point should be identified and challenged. • The next slide lists some questions to use in this challenge. FICCI CE What if the inspection was eliminated? • What if the inspection was eliminated? • Would the inspection be missed? • What is the potential impact in eliminating the inspection? • What potential consequences exist if the inspection is eliminated? • What is the likelihood that the inspection would have revealed a problem? FICCI CE IV. Minimize administrative tasks Administrative tasks often result in delays in process time due to excessive paper work, levels of reviews and multiple signatures (mostly by people who, it seems, are never available when needed). Reviews, approvals, signatures, preparing written documentation, making and distributing copies etc needs to be thoroughly reviewed.. FICCI CE V. Minimize storage and transportation activities Sometimes storage and transportation are necessary evils but because they are both non-value adding they should be minimized. The purpose of just-in-time inventory systems to minimize the amount of inventory stored. FICCI CE Minimize storage and transportation activities Transportation activities are also non-value adding. Often the relocation of single activity can significantly reduce the transportation requirements. FICCI CE 2. Process simplification • Simplification means reducing the complexities of process. Simplification can lead to lessor activities and lessor things to go wrong. Process simplification can be done by combining similar activities and by analyzing decision points. • Efforts should focus on reducing layers of management and structures that cause delays. Outdated systems and procedures need to be evaluated. FICCI CE Old Process Visit Bank Example of waste elimination: Cash withdrawal New Process Present Cheque Visit ATM Quality checks built-in WASTE Balance verification Withdraw cash Collect cash FICCI CE 3. Cycle-time reduction Cycle-time is the time required to deliver a product or service to a customer. Long cycle-times not only prevent prompt delivery of product/ service to your customers, but also increase costs. One of the best ways to cut down on your cycle-time is to conduct activities in parallel and eliminate unnecessary waste times as demonstrated on the next slide. FICCI CE 1. Activities Performed in serial 2. Activities performed in parallel FICCI CE 4. Create and implement performance based measures • If the performance of any system or process is not measured, it can not be meaningfully improved. Quantitative and qualitative measures that address both objective and subjective elements should be implemented. • The measures recommended are Revenue per employee, percent defectives, cost of quality, profitability ratios, customer satisfaction index etc. FICCI CE Incorrect performance measures create barriers Profit Strategies Sales Customer satisfaction Build inventory Many unfocused projects Select low price supplier Performance measures Efficiency variance Many improved teams Purchase price FICCI CE Correct performance measures Profit Sales Customer satisfaction Strategies Performance measures Cycle-time Cost of poor quality Supplier quality FICCI CE 5. Mistake proofing Mistake proofing is a scientific technique for improvement of operating systems including materials, machines and methods with an aim of preventing problems due to human error. The term “error” means a sporadic deviation from standard procedures resulting from loss of memory, perception or motion. For more details see “Mistake proofing” under “M”