Six SigmaContinuous Improvement Training

Six SigmaContinuous Improvement Training

Introduction to BenchmarkingIntroduction to Benchmarking

Six Sigma Simplicity

Key Learning PointsKey Learning Points

s Steal Shamelesslys Use the Experience of Otherss Plan to improve

s Steal Shamelesslys Use the Experience of Otherss Plan to improve

What is it:A comparative analysis technique intended to help performance improvement initiatives to set reasonable targets and to obtain vital process design information

When to use it:When the need to change or the degree of change is in debate and the process owner and/or other individuals need quantitative evidence that improvement is necessary and realistic

Benefits:Helps a learning organization gain insight into leading practices and competitor capabilities

What is it:A comparative analysis technique intended to help performance improvement initiatives to set reasonable targets and to obtain vital process design information

When to use it:When the need to change or the degree of change is in debate and the process owner and/or other individuals need quantitative evidence that improvement is necessary and realistic

Benefits:Helps a learning organization gain insight into leading practices and competitor capabilities

BenchmarkingBenchmarking

DefinitionDefinition

s Benchmarking:s A process of making improvements

supported by structured data collection which involves third parties

s Benchmarking:s A process of making improvements

supported by structured data collection which involves third parties

When to use BenchmarkingWhen to use Benchmarking

s When the team is working on processes so weak that they appear not to exist

s When your team is attempting something they have never done before

s When the team is considering applying a technology or strategy from competition or another business sector

s When you need fresh ideas

s When the team is working on processes so weak that they appear not to exist

s When your team is attempting something they have never done before

s When the team is considering applying a technology or strategy from competition or another business sector

s When you need fresh ideas

Results of BenchmarkingResults of Benchmarking

s Refine Existing Processs pursue process improvement

s Emulates model a best practice – match the best

s Leap Frogs combine best of the best – exceed the

bests Change the Rules

s borrow from another industry – aggressive competition

s Refine Existing Processs pursue process improvement

s Emulates model a best practice – match the best

s Leap Frogs combine best of the best – exceed the

bests Change the Rules

s borrow from another industry – aggressive competition

s Decide what to benchmark and whys Define the data requirementss Qualify the targets (set baseline)s Select partnerss Make arrangements to collect data and possibly visit the target location

s Decide what to benchmark and whys Define the data requirementss Qualify the targets (set baseline)s Select partnerss Make arrangements to collect data and possibly visit the target location

Benchmarking

s Develop interview guides Obtain the datas Validate the datas Do comparison analysiss Check for sensibilitys Prepare report and gap analysiss Implement a plan of action

s Develop interview guides Obtain the datas Validate the datas Do comparison analysiss Check for sensibilitys Prepare report and gap analysiss Implement a plan of action

Benchmarking

s Roles: Who does the process and what tasks are performed?

s Statistical: What results does the process produce?

s Process: How is the process designed and operated?

s 4 types of benchmarks:s Internal: peer group Business Units or Divisionss External: industry peer group competitorss External: world class industrys Best-in-class (BIC) processes

s Roles: Who does the process and what tasks are performed?

s Statistical: What results does the process produce?

s Process: How is the process designed and operated?

s 4 types of benchmarks:s Internal: peer group Business Units or Divisionss External: industry peer group competitorss External: world class industrys Best-in-class (BIC) processes

Benchmarking

Five Stages Reactions to Benchmarking

BargainingDenial

Depression

Anger

s Step 1: Preventative actions (future)s Documented feedback for lessons learneds Update system

s Step 2: Preventative actions (existing) s Examine current system and process. If none,

perform root cause analysis s Inform/ initiate the relevant operational team

for the potential corrective actions and follow up

s Step 1: Preventative actions (future)s Documented feedback for lessons learneds Update system

s Step 2: Preventative actions (existing) s Examine current system and process. If none,

perform root cause analysis s Inform/ initiate the relevant operational team

for the potential corrective actions and follow up

After BenchmarkingPrevent Recurrence

Plan for success: Step by StepPlan for success: Step by Step

1. Define Scope2. Form Team3. Set Baseline4. Select Partners

1. Define Scope2. Form Team3. Set Baseline4. Select Partners

s First agree what result you are trying to achieve:s Refine Existing

Processs Emulates Leap Frogs Change the

Rules

s First agree what result you are trying to achieve:s Refine Existing

Processs Emulates Leap Frogs Change the

Rules

What questions to askWhat questions to ask

5. Develop Interview guide

Quantitative questions.e.g To compare the lead times of 4 locations what do you ask for?

a) average + standard deviation of lead-timeb) capability to achieve a targetc) run chart + identification of special causesd) upper quartile lead timee) how many readings do you need? f) should the samples be the same size?

Qualitative questionsto ease analysis use a scale such as

1- I agree strongly 5 - I disagree strongly

Pilotto check for understanding and consistency of answer

5. Develop Interview guide

Quantitative questions.e.g To compare the lead times of 4 locations what do you ask for?

a) average + standard deviation of lead-timeb) capability to achieve a targetc) run chart + identification of special causesd) upper quartile lead timee) how many readings do you need? f) should the samples be the same size?

Qualitative questionsto ease analysis use a scale such as

1- I agree strongly 5 - I disagree strongly

Pilotto check for understanding and consistency of answer

GAP analysisGAP analysis

6. A tool - Collect/ Interpret data6. A tool - Collect/ Interpret dataLow High

1 2 3 4 5Productivity x oInventory turns x oNumber of suppliers xoWarrantee xoDSO x oLost Payment due to documentation x oStaff turnover x oRetests xoCasting rejections x o

our score xBest practice o

Solution - EffectSolution - Effect

7. Develop Action Plan7. Develop Action Plan

StatementProblem

People

Machines

Materials

Methods

Measurements

Environment

Search for root cause of specific problem

1) ProposedSolution

2) Anticipated effects of solution

8. Implement Plan9. Institutionalize

Here you apply the CI tools that are appropriate to your projects scopei.e. charter and schedule improvements as Kaizens /Projects and monitor the metrics with your steering committee.

8. Implement Plan9. Institutionalize

Here you apply the CI tools that are appropriate to your projects scopei.e. charter and schedule improvements as Kaizens /Projects and monitor the metrics with your steering committee.

Implement and Document

Benchmarking and leading changeBenchmarking and leading change s Identifies burning

platform for change

s Can identify quick wins

s Affirms success and acknowledges that we need to involve others to improve

s Shares need to compete using data & demonstration

s Identifies burning platform for change

s Can identify quick wins

s Affirms success and acknowledges that we need to involve others to improve

s Shares need to compete using data & demonstration

Benchmarking and leading changeBenchmarking and leading change

s Shares vision of what needs to change by how much

s Mobilises commitment by involving people. Team and process owner immersed in many levels of communication

s Measurement drives behaviour

s Shares vision of what needs to change by how much

s Mobilises commitment by involving people. Team and process owner immersed in many levels of communication

s Measurement drives behaviour

Overview of Benchmarking ProcessOverview of Benchmarking Process

1. Define Scope2. Form Team3. Set Baseline4. Select Partners5. Develop Interview guide6. Collect/Interpret data7. Develop Action Plan8. Implement Plan9. Institutionalize

1. Define Scope2. Form Team3. Set Baseline4. Select Partners5. Develop Interview guide6. Collect/Interpret data7. Develop Action Plan8. Implement Plan9. Institutionalize

Congratulate the team!

Six SigmaContinuous Improvement Training

Six SigmaContinuous Improvement Training

Introduction to BenchmarkingIntroduction to Benchmarking