Post on 02-Nov-2014
description
2014
2014-08-20
INNOVATION CENTRIC GROUP 1
Performance Improvement with Six Sigma
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as an operational philosophy
Customer centered means that projects start with, and are measured by, meeting customer wants and needs.!
Systematic means that the Six Sigma tools are applied in concert, which makes them vastly more powerful than they are alone.!
Data driven means that facts and data are used for making decisions.!
Six Sigma is a customer centered, systematic, data driven method for doing things better and aiming to reduce the number of defects of any given process.
What is Six Sigma?
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as an operational philosophy
It is a toolset which follows a well-structured improvement methodology to reduce process variability and drive out waste within a business processes using effective application of statistical tools and techniques. This converges on a disciplined method that uses data and statistical analysis to pinpoint the root causes of issues and establish ways of minimizing and eliminating them. The main goal of Six Sigma is to sustain improvement over the long term.!
What is Six Sigma?
Accounting Design Distribution Finance
Information Services
Logistics Oil & Gas Operations
Marketing 4
Six Sigma Applies to all areas
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“Responsible, proactive and innovative decision making can keep the focus on sustaining achieved benefits. Continuous improvement must be diverse and
productive over time as conditions change.”
“Constant management commitment is the number one lever to enable delivery of top-quartile performance via continuous performance improvement projects from my experience. It is analogous to safety performance
improvement where lack of management commitment equates to substandard safety performance.”
in the upstream oil and gas industry
Andy Brooks, CEO, Flint Transfield Services
Charlie Malone, Kurdistan Development Manager, Talisman Energy Inc.
”Performance management is crucial to any organization and valuable to not only measure performance but establish governance, and ensure the right
outcomes are achieved through desired actions and behaviors"
Tristan Goodman, VP Strategy & Regulatory Development, Alberta Energy Regulator.
Examples of applied Six Sigma
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Are you consistently fulfilling customers’(internal/external) requirements ... or are there gaps in your performance?
Do your improvement efforts continue to repay your investment ... or have the financial benefits of these efforts already been realized, with innovation and competitive gains now stalled?
Are you satisfied with how quickly you see measurable bottom-line results from improvement efforts ... or are technological advances, competitors, and the market forcing you to demonstrate improvement results in months rather than years?
Is your organization truly prepared to commit to continuous improvement as well as revenue growth ... or are processes still out of alignment with dynamic market requirements –costing you business success?
Interested in driving cost reduction to led to lost opportunities?
Is your organization looking at cost reduction opportunities to mitigate headcount reduction?
Are you looking to become a low-cost leader in high-cost environment?
Are you looking to improve effectiveness and achieve efficiencies in your organization?
Performance Improvement with
Acc
ount
ing • Quick Closing
•Accurate Reports •Accurate Journal Entries •Accurate Account Reconciliation
• Cycle Time to Close Books •Number of Errors •Number of Inaccurate JE’s •Reduce Cycle Time to Close Books (DMAIC) •Reduce Errors on Monthly Reports(DMAIC) •Reduce Number of JE’s(DMAIC)
Bill
ing
(to &
from
) • Accurate Invoices •On-Time Invoices •Easy to Under-stand Invoices • Receivables Management •Cycle time to Invoice •Invoice Error Rate •Working Capital Growth •# Call Center Complaints •Reduce Number of Invoice Errors (DMAIC) •Reduce Invoice Cycle Time (DMAIC) •Reduce Invoice Complaints (DMAIC)
Aud
iting
• Accurate Audit Reports •Frequency of Audits •Short Audit Time
• Sigma of Audit Reports •Percent Locations Audited •Audit Cycle Time CCRs •Improve Audit Report Process (DMAIC) •Improve Audit Coverage(DMAIC) •Improve Audit Cycle Time (DMAIC)
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Example of Six Sigma Applications
Define “as is” and “to be”
opportunity for project.
Measure current process
performance.
Analyze the problem to find out root causes.
Improve… Identify potential
solutions and begin to
implement them.
Control the performance to
continue to achieve higher
results.
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Improvement Process: DMAIC
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What makes DMAIC unique is that it focuses on eliminating problems by looking at the processes that create them, not on assigning blame to people or functions. DMAIC helps us research and analyze our processes, which then leads us to more effective and permanent solutions.
How do we do it?
Define
Measure
Analyze
Improve
Control
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The DMAIC process
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• Deliverable: • Identify Customer(s)and project *CTQ’s
(Critical to Quality)
A. Identify Project CTQs
• Deliverables: • Develop business case • Develop the Problem and Goal statements • Determine the project scope • Select team and define Roles • Set project milestones
B. Develop Team Charter
• Deliverable: • High level process map
C. Define process map
Define Phase
The DMAIC process
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• Deliverable: • Identify Measurable CTQ that will be
improved
A. Select CTQ Characteristics
• Deliverables: • Determine and confirm Specification
limits for your Y
B. Define performance
standards
• Deliverable: • Measurement system adequate to
measure Y
C. Establish data collection plan, validate measurement System
and collect data
Tools:
QFD
Process Mapping
FMEA
Pareto
Cause and Effect Diagram
Tools:
Continuous Gage R&R
Test/Retest
Attribute Gage R&R
Measure Phase
The DMAIC process
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• Deliverable: • Baseline Current Project
A. Establish Process
Capability
• Deliverables: • Statistically Define the goal of the
Project
B. Define performance
objectives
• Deliverable: • List of statistically Significant Xs,
Chosen based on Analysis of Historical Data
C. Identify Variation Sources
Tools:
Basic Statistics
Graphical Analysis
Sampling
Continuous Zst, Zit
Normality
Discrete Zst, Zit
Tools:
Benchmarking
Tools:
Process Analysis
Graphical Analysis
Hypothesis Testing
Regression Analysis
GLM
Analyze Phase
The DMAIC process
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• Deliverable: • Determine the Vital few Xs that are
causing changes in Y
A. Screen potential causes
• Deliverables: • Develop business case • Develop the Problem and Goal statements • Determine the project scope • Select team and define Roles • Set project milestones
B. Develop Team Charter
• Deliverable: • High level process map
C. Define process map
Improve Phase
The DMAIC process
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• Deliverable:"• Identify Customer(s)and project CTQ’s"
A. Identify Project CTQs "
• Deliverables:"• Develop business case"• Develop the Problem and Goal statements"• Determine the project scope"• Select team and define Roles"• Set project milestones"
B. Develop Team Charter"
• Deliverable:"• High level process map"
C. Define process map"
Control Phase
The DMAIC process
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From our experience leading purchasing transformation initiatives with global clients, we have developed a framework for maximizing purchasing’s impact on the enterprise value creation.
Strategic Sourcing
Transaction Execution
Demand Management
Supplier Management
Inventory Management Engineering & Operations
Enterprise Process and organizational model
Enterprise Purchasing Strategy
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Some of the features available:!• Aggregation of spend by supplier, manufacturer,
commodity, BU, buyer, location, etc.!• Tracking of spend against Contract!• Tracking of spend against Budget!• Price vs. Actual in savings!• Normalization of spend – mapping and cross-reference!• Ad hoc reporting and queries – ability to find procurement
related information thought filters and selection parameters.!
• Graphical representation for ease of understanding!• Tools and methods to import purchase data from
transaction systems!
Spend Analysis
PO/ AP Component
2014
2014-08-20
INNOVATION CENTRIC GROUP 18