Applying Six Sigma to Put the Metrics in Place and Streamline Processes

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Applying Six Sigma to Put the Metrics in Place and Streamline Processes

  1. 1. Measuring Performance Applying Six Sigma to Put the Metrics in Place and Streamline Processes May 12, 2006 Anthony Savarese, DTCC Glynis Aquino, DTCC
  2. 2. Today’s Presentation <ul><li>DTCC Background </li></ul><ul><li>Approach to Quality </li></ul><ul><li>Achieving Corporate Goals with Six Sigma </li></ul><ul><li>Case Studies: Metrics Based Approach </li></ul><ul><li>Lessons Learned </li></ul><ul><li>Questions </li></ul>
  3. 3. What is DTCC? <ul><li>Largest post-trade financial services infrastructure organization in the world. </li></ul><ul><li>Provides “cradle-to-grave” management of securities. </li></ul><ul><li>Primary business focus : clearance, settlement and asset servicing for virtually all equity and fixed income securities. </li></ul><ul><li>We are industry owned . </li></ul>
  4. 4. Our Customers <ul><li>NYSE / NASD </li></ul><ul><li>Mutual Funds </li></ul><ul><li>Insurance Companies </li></ul><ul><li>Trust Companies </li></ul>More than 11,000 companies within the global financial services industry Banks Broker / Dealers Investment Managers Securities Firms
  5. 5. Mission Statement <ul><li>By 2005, be seen as the provider of choice worldwide for investment servicing solutions through leadership, innovation and technology </li></ul>
  6. 6. 2005 Performance Highlights Total number of shares traded: 853 billion 6.8 billion : Total number of transactions processed $127.5 trillion : Financial obligations eliminated through netting Value of securities on deposit: $31.2 trillion Rebates, discounts and interest given back to customers: $528 million Value of securities settled through DTCC: $1.4 quadrillion $1.7 trillion: Value of mutual fund transactions processed
  7. 7. Today’s Presentation <ul><li>DTCC Background </li></ul><ul><li>Approach to Quality </li></ul><ul><li>Achieving Corporate Goals with Six Sigma </li></ul><ul><li>Case Studies: Metrics Based Approach </li></ul><ul><li>Lessons Learned </li></ul><ul><li>Questions </li></ul>
  8. 8. Approach to Quality <ul><li>1980’s </li></ul><ul><ul><li>Quality Circles </li></ul></ul><ul><ul><li>Employee Participation Program </li></ul></ul><ul><li>1990’s </li></ul><ul><ul><li>Continuous Improvement Program </li></ul></ul><ul><ul><li>Cost of Non Conformance </li></ul></ul><ul><ul><li>Work Process Improvement </li></ul></ul><ul><li>2000 – Six Sigma Launch & Quality Council </li></ul><ul><li>2001 – Central Quality Office </li></ul><ul><li>2002 – Six Sigma Infrastructure Teams </li></ul><ul><li>2005 – Lean & Balanced Business Scorecard </li></ul><ul><li>2006 – Cross-functional projects tied to goals </li></ul>Six Sigma
  9. 9. Creating a Quality Culture <ul><li>145 projects completed </li></ul><ul><li>83 trained professionals </li></ul><ul><li>$17,000,000 in accumulated savings </li></ul>Embedding Six Sigma – over 600 employees participating in process re-engineering
  10. 10. Project Selection Criteria <ul><ul><li>Revenue Enhancement / Cost Reduction </li></ul></ul><ul><ul><li>Customer Satisfaction </li></ul></ul><ul><ul><li>Defect Reduction </li></ul></ul><ul><ul><li>Cycle Time Reduction </li></ul></ul><ul><ul><li>Risk Reduction </li></ul></ul><ul><ul><li>Employee Satisfaction </li></ul></ul><ul><ul><li>Length of Time needed to Complete Project </li></ul></ul><ul><ul><li>Expected time to see results </li></ul></ul><ul><ul><li>Tied to Strategy </li></ul></ul>
  11. 11. Measuring Success <ul><li>Critical Customer Requirements </li></ul><ul><li>Critical Business Requirements </li></ul><ul><li>Industry and Regulatory Standards </li></ul>Corporate Goals Corporate Strategy
  12. 12. Today’s Presentation <ul><li>DTCC Background </li></ul><ul><li>Approach to Quality </li></ul><ul><li>Achieving Corporate Goals with Six Sigma </li></ul><ul><li>Case Studies: Metrics Based Approach </li></ul><ul><li>Lessons Learned </li></ul><ul><li>Questions </li></ul>
  13. 13. Corporate Goals <ul><li>Stakeholder/Financial </li></ul><ul><li>Customer/Service Delivery </li></ul><ul><li>Strategic Positioning </li></ul><ul><li>Employee/Learning and Growth </li></ul>
  14. 14. Voice of the Customer - VOC <ul><li>Survey metrics </li></ul><ul><li>Relationship management </li></ul><ul><li>Customer focus groups </li></ul><ul><li>Advisory groups </li></ul><ul><li>Incident management repositories </li></ul>
  15. 15. Voice of the Business - VOB <ul><li>Balanced Business Scorecard </li></ul><ul><li>Benchmarks and metrics </li></ul><ul><li>Financial reports </li></ul><ul><li>Regulators/Risk </li></ul><ul><li>Action plans </li></ul>
  16. 16. Voice of the Employee <ul><li>Employee survey </li></ul><ul><li>Townhalls </li></ul><ul><li>Employee action teams </li></ul><ul><li>Skills based development plans </li></ul><ul><li>Six Sigma Idea Generation forms </li></ul>
  17. 17. Enabling Employees <ul><li>Skills based competencies and curriculum </li></ul><ul><li>Various levels of process metrics training </li></ul><ul><li>Quality Council sponsorship of projects and process metrics </li></ul><ul><li>Education and awareness through </li></ul><ul><ul><li>Townhall meetings </li></ul></ul><ul><ul><li>Direct reports meetings </li></ul></ul><ul><ul><li>Communication campaigns </li></ul></ul><ul><li>Goals planning process </li></ul>
  18. 18. Achieving Corporate Goals <ul><li>Using metrics to determine performance gaps </li></ul><ul><li>Assessing overall business impact </li></ul><ul><li>Launching refinement projects </li></ul><ul><li>Monitoring to ensure gains are sustained </li></ul><ul><li>Leveraging improvements across multiple business units </li></ul><ul><li>Delighting our customers </li></ul>
  19. 19. Today’s Presentation <ul><li>DTCC Background </li></ul><ul><li>Approach to Quality </li></ul><ul><li>Achieving Corporate Goals with Six Sigma </li></ul><ul><li>Case Studies: Metrics Based Approach </li></ul><ul><li>Lessons Learned </li></ul><ul><li>Questions </li></ul>
  20. 20. Case Studies
  21. 21. Case Study 1: Customer Sales and Onboarding <ul><li>Proactive Front End </li></ul><ul><li>Client project timelines, critical path </li></ul><ul><li>Set & manage client expectations </li></ul><ul><li>Profiled hunt list </li></ul><ul><li>Measure On-time performance </li></ul><ul><li>Trends, Root Cause Analysis </li></ul><ul><li>Jeopardies, Action limits </li></ul><ul><li>% Planned vs. Actual Completion </li></ul><ul><li>Moving from </li></ul><ul><li>Next available prospect in queue </li></ul><ul><li>serial flow </li></ul><ul><li>Moving to </li></ul><ul><li>“ Choose” to “Use” focus </li></ul><ul><li>Trending root causes of delays </li></ul><ul><li>A targeted, tiered project portfolio view </li></ul><ul><li>Action and Improvements </li></ul><ul><li>Act on Jeopardies </li></ul><ul><li>Data-driven improvements </li></ul>“ Choose” “ Use” <ul><li>Parallel processes </li></ul><ul><li>Member & DEA Questionnaires </li></ul><ul><li>Credit approval & Implementation </li></ul>PM RM DEAs Service Bureaus RS CR Ops T-ORR IA Legal Onboarding Team PIP Sr. Mgmt Clients Clients
  22. 22. Customer Sales and Onboarding: Process Flow Implementation Approval Relationship Collateral Use
  23. 23. Customer Sales and Onboarding: Metrics Report - Illustrative View
  24. 24. Customer Sales and Onboarding: Metrics Report - Illustrative View
  25. 25. Case Study 2: Problem Resolution <ul><ul><li>Key Drivers of Satisfaction </li></ul></ul><ul><ul><ul><li>Commitment to quality </li></ul></ul></ul><ul><ul><ul><li>Customer service </li></ul></ul></ul><ul><ul><ul><li>Communication with the customer </li></ul></ul></ul><ul><ul><ul><li>Sense of urgency </li></ul></ul></ul><ul><ul><ul><li>Ability to increase operational efficiencies </li></ul></ul></ul><ul><ul><li>PROBLEM RESOLUTION </li></ul></ul>
  26. 26. Problem Resolution: Metrics Based Approach <ul><li>Implemented internal SLA’s and dashboard </li></ul><ul><li>Implemented customer facing metrics dashboard </li></ul>VOB VOC
  27. 27. Problem Resolution: Improving Supplier Partnerships <ul><li>Identified top 5 supplier offenders </li></ul><ul><li>Communication and awareness </li></ul><ul><ul><li>Employees </li></ul></ul><ul><ul><li>Suppliers </li></ul></ul><ul><li>Reduced items aged over 6 days </li></ul>% Aged Items over 6 Days
  28. 28. Problem Resolution: What Satisfied Customers are Saying <ul><li>“Your staff jumps through hoops for us. [There] are three that come to mind.” </li></ul><ul><li>“Tom stated that he has seen a great improvement in the quality of answers to [electronic] inquiries. He would like to see turn-around time improved.” </li></ul>
  29. 29. Today’s Presentation <ul><li>DTCC Background </li></ul><ul><li>Approach to Quality </li></ul><ul><li>Achieving Corporate Goals with Six Sigma </li></ul><ul><li>Case Studies: Metrics Based Approach </li></ul><ul><li>Lessons Learned </li></ul><ul><li>Questions </li></ul>
  30. 30. Lessons Learned <ul><li>Benefits - Adopting this paradigm has focused DTCC on projects that are cross-functional in nature and less down in the noise </li></ul><ul><li>Aligned with corporate strategies </li></ul><ul><li>Line employees get it! </li></ul>
  31. 31. Our Future - What We are Striving For <ul><li>A single industry-driven strategy </li></ul><ul><li>A streamlined clearance and settlement process </li></ul><ul><li>Heightened global competitiveness </li></ul><ul><li>Shortened settlement cycle (T+1) </li></ul><ul><li>Delighted customers </li></ul>
  32. 32. Today’s Presentation <ul><li>DTCC Background </li></ul><ul><li>Approach to Quality </li></ul><ul><li>Achieving Corporate Goals with Six Sigma </li></ul><ul><li>Case Studies: Metrics Based Approach </li></ul><ul><li>Lessons Learned </li></ul><ul><li>Questions </li></ul>

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