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6σ
6
       A 3-Tier Approach for Using DFSS to
      Pull and Govern Six Sigma Projects in a
             Transactional E...
Agenda

                About CIGNA
                Integrated Enterprise Excellence and DFSS
                CIGNA’s 3-Ti...
CIGNA is a National Insurance Provider

       • CIGNA provides employee benefits, including health care products and serv...
CIGNA’s Six Sigma History is Relatively New

          • Selected Six Sigma as Enterprise-wide Quality Framework
         ...
Why DFSS?

  • Increasing Pressures:
        – From Clients and their Employees, to reduce medical costs without
         ...
2004 Objective was to Achieve Significant Results, Fast

 Use Six Sigma Method to help:
     – Get 2004 savings from proce...
CIGNA’s Holistic Approach to Implementing Six Sigma

   •    Enterprise Level Define-Measure-Analyze (DMA) Work
         –...
It all Begins with Targeting the Right Metrics


                                                                       • ...
We Start at the Top

    The Enterprise DMA begins by defining the end-to-end
    process and its key output metrics


   ...
The General Target Area Gets Selected

    Six Sigma tools are employed as part of Enterprise
    DMA to then select high ...
Governance Teams Get Established

    Governance Teams are then established to:
       • Develop lower-level, supporting m...
Finally, Teams are Launched at Specific Targets

    Governance Teams then create project teams
       • By using info fro...
Metrics and business needs dictate projects

                                                                             ...
DMADV is Guiding the Development of a New Process


                                              New Healthcare Provider ...
Critical-to-Quality Items are being Built into new Process

      CMSI – Negotiate and Approve Provider Contract

        ...
Strategic Business Initiative (SBI) Charts* Show Linkages
                                                                ...
Six Sigma is a Catalyst for Delivering Synergy

       Cross-functional Six Sigma teams enhance communications across
    ...
In Summary

       •    DFSS is more than just DMADV projects
              – It can be used to help execute business stra...
What questions do you have?




WCBF Design for Six Sigma Conference June 10, 2005    19
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Microsoft PowerPoint - 18 DAY TWO 1125 Behnke

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Transcript of "Microsoft PowerPoint - 18 DAY TWO 1125 Behnke"

  1. 1. 6σ 6 A 3-Tier Approach for Using DFSS to Pull and Govern Six Sigma Projects in a Transactional Environment Leslie Behnke V.P., Six Sigma Business Excellence CIGNA Corporation www.CIGNA.com WCBF Design for Six Sigma Conference June 10, 2005 1
  2. 2. Agenda About CIGNA Integrated Enterprise Excellence and DFSS CIGNA’s 3-Tier Approach Enterprise Level DMA Governance Teams DMAIC & DMADV Project Teams Summary and Q&A WCBF Design for Six Sigma Conference June 10, 2005 2
  3. 3. CIGNA is a National Insurance Provider • CIGNA provides employee benefits, including health care products and services, and group disability, life and accident insurance • $18B annual revenues, with 28,000 employees, and over 200 years of service • Service and highly transactional business; no manufacturing aspects WCBF Design for Six Sigma Conference June 10, 2005 3
  4. 4. CIGNA’s Six Sigma History is Relatively New • Selected Six Sigma as Enterprise-wide Quality Framework in 2003 – Previous Quality initiatives were localized and centered around accreditation criteria and internal audit functions – Executive recruited from Motorola to lead the new initiative – Leading Six Sigma supplier selected to provide Six Sigma training and technical Support – Comprehensive Quality Framework defined to include statistical methods, Lean tools, strategic quality management and behavioral performance – Senior Leadership support coupled with grass-roots pull deployment strategy. Six Sigma momentum now gaining rapidly WCBF Design for Six Sigma Conference June 10, 2005 4
  5. 5. Why DFSS? • Increasing Pressures: – From Clients and their Employees, to reduce medical costs without impacting quality – From Healthcare Providers, to reduce administrative burdens – From the Competition, to provide the best products and service, at the lowest costs – From the Government, to comply with increasingly complex regulations • Unacceptable Levels of Variability – History of mergers/acquisitions and decentralization had left CIGNA with a proliferation of processes and systems • Increasing Need for Break-through Products and Services – Voice of Customer is demanding altogether new levels of product innovation and service delivery WCBF Design for Six Sigma Conference June 10, 2005 5
  6. 6. 2004 Objective was to Achieve Significant Results, Fast Use Six Sigma Method to help: – Get 2004 savings from process/productivity improvement – Change culture to have more customer focus and discipline around metrics – Develop future business leaders who understand the end-to-end business processes and have a customer orientation Six Sigma Strengths: – Metrics and fact based – Customer focus – Cross functional process focus – Financial justification Potential Target Areas: – Medical Costs – Operational Expenses – Membership – Service – Systems WCBF Design for Six Sigma Conference June 10, 2005 6
  7. 7. CIGNA’s Holistic Approach to Implementing Six Sigma • Enterprise Level Define-Measure-Analyze (DMA) Work – End-to-End Process View – Enterprise-Level Metrics – Provides basis for identifying highest areas of improvement opportunity – Provides common context to coordinate and integrate projects • Governance Teams – Key metrics for selected high potential areas, linked to above – Common Quality Assurance framework – Shared, integrated procedures and training High Level Define- DMA Measure- Analyze to select target area • Project Teams Governance Level: Governance metrics, QA, P&P’s, – DMAIC, DMADV, Kaizen, other Change Mgmt – Specific, strategic projects Specific projects: DV Kaizen AIC DMA DMAIC, DMADV, DM Kaizen events WCBF Design for Six Sigma Conference June 10, 2005 7
  8. 8. It all Begins with Targeting the Right Metrics • Satellite-level® metrics* Satellite-Level are high level business metrics 30,000-Foot-Level • 30,000-foot-level® metrics* are high level operational or Six Sigma/Lean project metrics High-level control charts are created High-level control charts are created ••Satellite-level metrics might be reported monthly Satellite-level metrics might be reported monthly ••30,000-foot-level metrics might be reported daily 30,000-foot-level metrics might be reported daily * Terminology from CIGNA’s Six Sigma provider, 8 WCBF Design for Six Sigma Conference June 10, 2005 Smarter Solutions, Inc..
  9. 9. We Start at the Top The Enterprise DMA begins by defining the end-to-end process and its key output metrics The End-to-End Claims Process Establishing Receiving and Reconciling and structure & eligibility Processing reporting claims for claims to be Claims payments processed “30,000 foot” Key Output Metrics: 80 • Claim payment accuracy Individual Value 75 80 Individual Value • Claim payment timeliness 70 75 80 Individual Value 0 70 75 • Costs to process claims Subgroup 10 20 Subgroup 70 0 10 20 Subgroup 0 10 20 WCBF Design for Six Sigma Conference June 10, 2005 9
  10. 10. The General Target Area Gets Selected Six Sigma tools are employed as part of Enterprise DMA to then select high potential target areas Establishing Receiving and Reconciling and structure & eligibility Processing reporting claims for claims to be Claims payments processed Enterprise DMA: Sub-processes: Enterprise DMA: • Provider contract design • •Key E2E Process Output Metrics Key E2E Process Output Metrics • •Claim payment accuracy Claim payment accuracy Provider data loading • •Claim payment timeliness Claim payment timeliness • •Costs to process claims Costs to process claims • Benefits structure design • •Voice of Customer • Client benefits structure load Voice of Customer • •Quality Function Deployment (QFD) Quality Function Deployment (QFD) • Member eligibility loading • •Enterprise-level Cause & Effect Analysis Enterprise-level Cause & Effect Analysis WCBF Design for Six Sigma Conference June 10, 2005 10
  11. 11. Governance Teams Get Established Governance Teams are then established to: • Develop lower-level, supporting metrics • Ensure continuous quality improvement structure • Develop policies and a structure for procedures • Facilitate sharing of best practices Establishing Receiving and Reconciling and structure & eligibility Processing reporting claims for claims to be Claims payments processed Sub - processes: Key Output Metrics: • Provider contract design Direct metrics • Data loading accuracy Provider data loading • Data loading timeliness • Costs to load data • Benefits structure design Shared Metrics • Client benefits structure load • Provider selection accuracy • Member eligibility loading • Reimbursement accuracy WCBF Design for Six Sigma Conference June 10, 2005 11
  12. 12. Finally, Teams are Launched at Specific Targets Governance Teams then create project teams • By using info from the Enterprise DMA work • By assessing lower level supporting metrics • By doing mid-level analyses Establishing structure & eligibility for claims to be processed Provider data loading A – (DMAIC) Loading hospital data B – (DMAIC) Loading practitioner data C – (DMADV) Provider Contracting Process WCBF Design for Six Sigma Conference June 10, 2005 12
  13. 13. Metrics and business needs dictate projects 80 Individual Value Establishing Key Output Metrics: 75 80 structure & eligibility Individual Value • Claim accuracy 80 75 for claims to be 70 • Claim timeliness Individual Value processed • Cost to process Subgroup 0 70 75 10 20 Subgroup 70 0 10 20 Provider data loading projects Subgroup 0 10 20 Process improvement projects will } A – (DMAIC) Loading hospital data provide acceptable shorter-term B – (DMAIC) Loading practitioner data results C – (DMADV) Provider Contracting Process } Business competition dictates major improvement needed for longer term: • Compliance to standards, yielding major costs savings • Accuracy levels to be improved dramatically • Cycle time to be reduced significantly • Significant technology investment may be required. 13 WCBF Design for Six Sigma Conference June 10, 2005
  14. 14. DMADV is Guiding the Development of a New Process New Healthcare Provider Contracting Process •Audit Contracts •Easy Authoring •Easy Authoring •Audit Contracts •Highlight Risks •Best Practices and Templates •Highlight Risks •Best Practices and & Terms Controls •Business, Language Templates •Improve Operations •Business, Language •Improve Operations •Optimize Contracts •Review & Approval & Terms Controls •Optimize Contracts •Review & Approval Create Analyze &Control & Improve Negotiate •Identify Renewals • Collaborative Negotiation • Collaborative Negotiation •Identify Renewals &Execute • Sign && File •Initiate Renewals •Initiate Renewals • Sign File •Author & Close Renew & • Contracts Drive Supply •Author & Close Capitalize • Contracts Drive Supply Chain or Fulfillment Chain or Fulfillment Systems Systems Administer & Comply •Manage Payments •Manage Payments •Manage Obligations •Manage Obligations •Ensure Compliance •Ensure Compliance WCBF Design for Six Sigma Conference June 10, 2005 14
  15. 15. Critical-to-Quality Items are being Built into new Process CMSI – Negotiate and Approve Provider Contract 1.1 Plan 1.2 Build 1.3 Negotiate 1.4 Execute 1.5 Communicate 1.6 Admin 1. Capability to support contract negotiation 5. Support higher preparation, planning, and Internal or external quality negotiations request contract maintenance. Financial 1.2.1 1.3.1 with providers. 1.6.1 Analysis Present Administer Templates 1.1.1 1.4.1 Workload 1.5. 1 Planning Sign Communicate to apropriate 1.6.2 1.2.2 parties Administer Assemble Internal Reimburse Organization Teams 1.3.2 Update 6. More robust1.6.3 1.4.2 Administer 1.1.2 communicationExternal Situational Assessment 3. Faster, easier Distribute and Store Organization and document 1.2.3 Assemble contract creation routing Contract Lanaguage and storage. capability. 1.6.4 Administer Reports and Queries 1.5.2 1.1.3 Contract Plan 4. Increase quality of contractappropiate Communicate to content through standards, users 1.6.5 compliance, and review. Manage Contracting 1.2.4 Review 2. Faster and more & Process Management comprehensive access Approval 1.3.3 to data and documents Withdraw/ Terminate 7. Ongoing process improvement that support contract framework capability. negotiations. WCBF Design for Six Sigma Conference June 10, 2005 15
  16. 16. Strategic Business Initiative (SBI) Charts* Show Linkages Black/Green Strategy Business Priorities High Potential Areas Projects Belt Hospital contract loading (DMAIC) B Black Laboratory contract loading (DMAIC) G Green Best Practice Sharing Process (Govern) A Rod Increase Reduce Provider profitable Medical Contracting Scorecard Development Team (Govern) L Javit growth Costs Process Provider Contracting Process (DMADV) N Kidd Executive Optimize TPV Networks (DMAIC) R Kaboo Sponsor: T Smith K.Jones Establish Provider Data Loading Quality J Q Public Assurance Program (Govern) J Rogers Provider Site Consolidation (DMAIC) P Luto Contract Billing Process (DMAIC) M Mouse * Terminology from CIGNA’s Six Sigma provider, 16 WCBF Design for Six Sigma Conference June 10, 2005 Smarter Solutions.
  17. 17. Six Sigma is a Catalyst for Delivering Synergy Cross-functional Six Sigma teams enhance communications across divisions, focused on common goals and metrics. • Shared metrics • Common language/approach • powerful statistical tools WCBF Design for Six Sigma Conference June 10, 2005 17
  18. 18. In Summary • DFSS is more than just DMADV projects – It can be used to help execute business strategy and flow down metrics – It can be used to help select, categorize and prioritize projects • CIGNA is using a 3-Tier approach to Six Sigma deployment, based in part on the overall concepts in DFSS – Enterprise-level DMA – Governance Teams for High Potential Areas – Strategic Projects (DMADV, DMAIC, other) • This is highly applicable in our transactional service business. WCBF Design for Six Sigma Conference June 10, 2005 18
  19. 19. What questions do you have? WCBF Design for Six Sigma Conference June 10, 2005 19
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