Lean Six Sigma Opportunities at ACE

8/12/2019 Lean Six Sigma Opportunities at ACE

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Lean Six Sigma Opportunities at ACE

1. TAT of policy issuance Time from acceptance by the customer to when hereceives the policy pack can be reduced dramatically

Define : Reduce account opening time by 50%Create high-level process maps

Measure : TAT for each part of the processNumber of loopsDecision pointsBatch processing stepsFind NVA activities like waste transport, motion, overproduction, defective,rework etc.Objective to eliminate these NVA

Create hypothesis e.g. preceding months num ber of defects were going intosuccessive monthsGet your data from legacy systems and physical records

Analyse : Stitch your data together such as average TAT increasing from week 1to 3 and then drop in week 4. Maybe because of incentive or monthend pressure.Transportation takes up 20% of TAT; defect rates are another 30%. Plus theprocess is batch processed

Improve : The team introduced imaging rather than paper process + autochecksand validation + easier filling of form

Conclusion

2. Customer Service 1-call resolutions

Save time on making proposals

Reduce defects on printing welcome pack

Reduce product development time

Inventories reduction

Increase customer delight by sending policy in 1 day, 1 hour response toemail requests, 4 hour call backs

Eliminate procedures that donot make sense

Where are people wasting time?

What activities add how much value?


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Risk management there can be over 100 risks in any project

On-time quotes

Project status sheets

Reduce cycle time

Reduction efforts

Identification of the greatest levers

Interrelationships and the ultimate cost of complexity

Speed-to-results

Practical and pragmatic implementation

Sustainability of efforts

Enterprise speed reducing waste across and between functional units whichbrings in cost reduction and true competitive advantage

Speed up processes slow processes make unhappy customers

Reduce variability in processes

Closing of a warehouse results in savings in inventory, capital equipment, people,insurance, taxes, energy, transportation, product damage and handling

Improving quality

Customer put on hold during a call

Feeding higher quality leads in the sales funnel

Reduce development times for new products

Shorten process lead time

Improve customer service levels


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Excessive work in typing and processing

Defective bills

Re-order levels

Lean six sigma lets you cut the fat and not the muscle i.e. reduce costs withoutdestroying the ability of meeting customer needs

Late deliveries cost savings might be miniscule but the loss of revenue can behuge

High inventory levels

Ill-conceived policies and procedures

Lack of integrated planning and scheduling

Low equipment or operator reliability

Understand real needs of customers in products; is this particular feature valuedby the customer?

Competitors may try to copy your products and offerings, but it is nearly impossibleto copy your processes

The true cost of a process can be measured in terms of its efficiency to createvalue for the consumer. Costs which donot create value are wastes oradministrative costs.

Lean means speed, not just waste reduction

Wastes = Costs = Opportunities

7 common wastes

Transportation poor layout of facilities, departments in different buildings,use cellular flow process to reorganize the work area to reduce processing time,reduce batch sizes

Inventory it is the result of erratic demand and supply forecasting, unrealisticplanning, use value stream mapping , contracts are based on unusually highestimates of volumes, very little understanding of profitability & cost structures,use visual management tools (training records, project plans, weeklyperformance, defect charts, holiday plans, company mission, 5S)

Motion unnecessary typing, unnecessary walking, it is denoted in lost time, putsafety of employees first

Waiting causes of delay, eliminate unnecessary steps, control work-in-processlevels, value stream mapping, compare process capability to customerdemand rate , interrupted processes, paperwork


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Over production avoidable expediting fees, special orders, overpayments,early payments, high service fees for legal or accounting, these happen due tolack of communication or awareness of procedures, marketing materials areordered when the stock goes low in head office but there may be a lot of materialin branch offices, track inventory

Over processing delivering more than what the customer wants, start withvoice of customer , determine the value at each step using value streammapping

Defects focus on high cost areas of rework, repairs and scraps, focus on areasrequiring overinspection, use statistical tools like DMAIC, ANOVA

Making a taskboard

1. Show all the work in scope and its status

2. Show who is working on what

3. Split into presenters and critics

- Use colored tape (insulation) for making a table on the white board

- Use different colored post-it notes and different shapes like star

- Make colored printouts and stick with tape after people have written on it

- Buy some colored magnetic circles- Buy markers for white board and permanent

- If possible have the photos of participants with numbers

- Create a separate parking lot

- Create stickies for status like finished, on-hold, work-in-progress, not started

- Use the right size pen for the right size sticky

- Ask questions :

Stage 1 : What features and functionalities need to be built for the site to besuccessful?

o Independently write down the ideas, aim for 10-15 per persono Now group the stickieso Name your groups with a different color sticky

Stage 2 : What is the deeper purpose of a feature on the site?

o Use the 5 whyso Do this for all top level featureso Label them 1.1, 1.2, 1.2.1


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o What are the new perspectives, insights and observations?o How can you add those to your original clusters?

Stage 3 : What do we need to build first for the site to be a success?

o Use red dots 4 per persono Remove zero dots and divide the dot ones into highest, medium and

lowesto Vote again with blue dotso Now divide as top -priority, important, consider, low priority

Stage 4 : How does what when to make the site successful?

o Take the top feature and start putting tasks ; 10-15 per persono Divide by time week 1, 2, 3, 4 on the x axiso Now put in the roles (name of employees) on the Y axis

- Use digital photo to capture different states (IMPORTANT)- Make sure the writing on the post-it is legible (block letters)- Sharpen using photoshop

Cost of penalties

Cost of lost business

When you have research interview data put it on post-it notes on a big wall

Then categorize them into clusters

1. Reduction of Defects

Are there any occurrences of high volumes of rework and/or defects?

Have there been any failures besides the preferred specifications?

Does the given process possess a high degree of variation?

Would any scientific adjustments to the process result in forceful changes?

Does the process have any residual scrap?

Which inputs need to be managed for producing an unfailing output?

2. Reduction of Cycle Time

Is the resultant production of the process below the one expected?


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Do any of the processes depend on multiple hand-offs between the individuals?

Is the process being delayed because of machine/computer downtime?

Does the process require a lot of overtime?

3. Reduction of Resource Consumption

Does the process need more workers for doing the job?

Does the process undergo a high variation in the consumption of material?

Customer desire Is project currently in process?

Cost reduction Is solution predetermined?

Quality improvement Does the project have a forseeableend?

Time/size Are project drivers or measurements known?

Technical requirements

Cost reduction

Productivity Improvement

Market-share growth

Customer retention

Cycle-time reduction

Defect reduction

Culture change

Product/service improvement

Billing defects

Invoice disputesSpeeding payments

Contract review system

Poor routing decision of the transport truck means excessive fuel, time andmoney

Return of policy documents due to wrong address or pin-code

Accurate data input and output quality

More responsive service to customers


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Faster completion of deals

Better understanding of requirements

Improve profit margin

Best practices

Improve rate of reaching a caller

Compare performance to customer requirements

Rate of improvement in processes and products

On-time delivery

Transform business communication, leadership, teamwork, measurement,focus on customer

Reduce costs of reworking defects

Design of new products

Reduce time from design to certification

Apply virtual design to speed quick response

Customer orders transmitted electronically

Analyze and improve call centre operations

Reduce average call answer time

Increase percentage of customer issues resolved in initial call

Simplify the call answering system

Material work-flow

What counts?

Launch new ventures

Access new markets

Acquire new organizations

Minor adjustments and major shifts

Ambitious goals

Set clear priorities

Focus on problem prevention


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Reduce variation

Figure out which are the inputs and which are the outputs (drivers)

Relationship between input and output

Forecasting

Reimbursements

Billing

Cashflow

Zero late deliveries

Reduce calls to call-centre

Proposal templates

Long hold time in call centre

Late deliveries

Incomplete shipments or returns

Power outages

Reduce bureaucracy

IT downtimeParts shortage

Post sale maintanence and repairs

Expense check discrepancy

Accurate validation of Six Sigma gains

Strong infrastructure to support change and sustain results

The key to rapid cost saving is to focus on high cost wastes rather than on thevalue-add steps themselves

Dr. Deming 90% problems are with the system; 10% is with the people

Minimize unnecessary work

When starting out with a team on a process workshop, start with a SIPOCdiagram

Teach people to see their work as a process and to see waste in their processes this is done by value stream mapping


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Take time to collect current and comprehensive voice of customer data

Many projects go off-course because people have not been defined up front. Usea RACI chart . Divide people into different roles

a) Sponsor

b) Team leaders

c) Team members

d) Coach

VOC methods Focus groups, Interviews, Surveys, Ethnographic studies

Avoid the squeaky wheel syndrome by concentrating on the noisiest person

Ask : How long is how long on CS holding time?

Develop a CCR worksheet Customer Critical Requirements

The foundation of all CCR is the operational definition. And both, you and thecustomer must define the process, product or service characteristic in the samemanner.

There may be an inconsistency of definition between you and your supplier

Important methods for CCR

[1] Key Buying Factor Analysis compare your delivery on various customerrequirements against customer perceptions of both you and competitors


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[2] Quality Function Deployment or House of Quality Translates customerneeds into design requirements. Dont use words like fast, responsive butconvert them into specific requirements like loan within 3 days, pick my call in30 seconds etc. (TO BE LEARNED)

Lean Six Sigma Opportunities at ACE

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