Use of DMAIC for Business Process Improvement in eBusiness

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Select a business that does not have, or has a limited eBusiness platform.

Objective: Take a magazine from a publishing platform specific process, to a publishing platform neutral process.

Goal: Assess current business operations and content creation processes within the publishing process. Use analysis tools (DMADV) and (DMAIC) respectively and to apply the lessons of this exercise and best practices of lean six sigma to craft a new publishing process that is platform neutral allowing magazine to reach new audiences via new digital channels.

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Use of DMAIC for Business Process Improvement in eBusiness

  1. 1. James DellingerMECB1 - MSc in Electronic Commerce (Business)MT530 Business Modelling & Process InnovationOption 1: Select a business that does not have, or has a limited eBusiness platform.Objective: Take a magazine from a publishing platform specific process, to a publishingplatform neutral process.Goal: Assess current business operations and content creation processes within thepublishing process. Use analysis tools (DMADV) and (DMAIC) respectively and to applythe lessons of this exercise and best practices of lean six sigma to craft a new publishingprocess that is platform neutral allowing magazine to reach new audiences via newdigital channels. DeclarationI the undersigned declare that the project material, which we now submit, is my ownwork. Any assistance received by way of borrowing from the work of others has beencited and acknowledged within the work. I make this declaration in the knowledge that abreach of the rules pertaining to project submission may carry serious consequences.I are aware that the project will not be accepted unless this form has been handed in alongwith the project. Due Date: 20th December 2011
  2. 2. MT530 Business Modelling & Process Innovation Assignment #3Lecturer: Dr. PJ Byrne Student Name Student Number James DellingerSigned:_________________________Describe the EnterpriseThe business chosen for this project is a small Irish publisher of a modern living andinteriors magazine, Ur Dream Home. The small organization has very limited e-commerce and e-business activities on urdreamhome.ie toward this end. It is a great timeto be in the publishing business, but not if your enterprise is tied to one mode of contentdelivery.Unfortunately, this one is platform specific (glossy magazine), but the challenge faced byUr Dream Home is not unique and is being faced by all publishing organizations addingdigital operations and attempting to become platform neutral. The staff count is relativelysmall one editor, one advertising sales associate, three page designers, and five part timecontributing authors. One core assumption of this review is that Ur Dream Home is not ina position to hire more full time staff and that any changes to the business to increaseefficiency and product quantity will need to be done via changes in the way work iscompleted and some staff may be required to be trained to fulfill more roles and duties inthe organization and within their current job descriptions.This is an understandable issue given the declining profit margins in the publishingindustry. Primarily, this change is due to the proliferation of content created with theadvent of amateur, semi-pro, and professional web only content sparked by first the blogand then web 2.0 changes. Given that this content is on virtually every subject andrefreshed rate faster than the old daily, weekly, monthly, and bi-monthly, and quarterlycategories the magazine industry was comfortable with this is a real work problem. 2
  3. 3. Ur Dream Home will not stay immune to the same market forces forever. The contentquality of this magazine is very high, premium in fact; however, the readership isextremely limited by the availability and distribution of the physical glossy magazine.This mode of delivery hampers growth or brand awareness about the product.Our goal is to adapt this magazine to distribute its premium to the modern publishing eraand move from a publishing platform specific process, to a publishing platform neutralprocess. This shift will require a review and likely changes to the organizations operatingprocesses.Description of the process(es) being reviewedOption one was chosen for this assignment, because Ur Dream Home has a limitedeBusiness platform. Currently it’s website at urdreamhome.ie is a primarily signpost site.Ur Dream Home is in need of a new digital approach that encompasses both, e-commerceand e-business (Canadian Business Network, 2011). Why?From the e-commerce perspective there is no wait to purchase a subscription to themagazine online or the website. From an e-business perspective, in examiningurdreamhome.ie it is quickly quite clear there is currently no coherent strategy for digitalpresentation of ‘UR Dream Home Magazine,’ content. Some content is available, but itremains difficult to find the site or content via search engines, or when navigating thewebsite. Thirdly, the website is neither self-supporting with revenue or yielding seeablemarketing value, from either brand marketing or content marketing perspective. Basiccustomer services via the website are missing.The problems stem from the two sub-processes that make up the magazines publishingprocess, business operations and secondly content creation and the positive synergiesworking or failing. The two vital processes are interlocked and interlinked components ofthe overall publishing process. In publishing you can’t sell advertising and subscriptionsagainst bad content and great content without advertising and subscriptions are just 3
  4. 4. authors and writers without a paychecks. Some even argue to tear down this boundary(Benkoil, 2011). In order to keep focus and boundaries these are the to defined sub-processes that are in our scope of the publishing process.There is a dance done everyday between those running both of these processes insideevery content publisher and journalistic endeavor across the planet in the form ofmanaging the page count. Sales and marketing needs to have an idea what content iscoming for the next volume/issue and content needs to know that their checks will notbounce the next time the go to cash it and maintain their ethical credibility and trust withreaders. So despite mutual suppositions’ both processes must work together yielding amix in a publication of paid ads, content and unpaid house ads.First we will examine, “business operations” including ad sales, subscriptions sales,marketing, printing, and delivery. Second we will examine the “content cycle,” an articlefrom idea to writer, to editor, to page designer, to readership then using processimprovement tools to get our magazine with a new publishing process that is platformneutral and cash flow positive. Lean / SixSigma analysis tools have been chosen toevaluate the processes of this company as time management and maintain a low mistakeratio are very important elements in publishing given the high levels of human capitalgiven in the ability to create a product. Despite critiques by (Davenport, 2008) LeanSixSigma remained the strongest most relevant evaluation tool for this environment.Use of (DMADV) for analysis of Business OperationsThe process tool to be review business operations side within the framework of Ur DreamHome’s business operations we will use is Define, Measure, Analyze, Design, Verify,(DMADV) (isixsigma.com, 2010) to think deeply and analyze and brainstorm about UrDream Home’s business operations from start to finish. The new products being sold andnew operations being managed require the use of DMADV and not another analysis toolsince the deliverables coming from the change are new and elements of the process arenew. 4
  5. 5. • Define: the project goals and customer (internal and external) deliverables (isixsigma.com, 2010)Our goals for Ur Dream Home is to make the publishing process platform neutral (notjust selling advertisements and subscriptions to a glossy magazine) and create a newmonetization means via digital streams, for current and additional content products andthat are revenue positive and are engaging to new readers are engaged with the content. • Measure and determine customer needs and specifications (isixsigma.com, 2010)The production process capabilities will need to be altered, in order to make Ur DreamHome platform neutral without hiring more staff. The risks are great and come from thepotential for employees possible backsliding into old habits, job tasks, and methods ofoperation. Readerships desire a publisher to engage them where they are during theirchanging busy reading schedules, online: at work early morning; before lunch; before therush to the door; and on the new devices they own, mobiles and tablets. However, thismust be cash flow positive. The business operations side the customers are its advertisersas well as and current subscribers. How long does it take to complete the key tasks? If thetimes were shorter would advertisers purchase more ads? • Analyze the current business operations process and options needed for Ur Dream Homes to meet customer needs (isixsigma.com, 2010)Ad sales, subscriptions sales, marketing, printing, and delivery are core businessoperation functions of the magazine. Ur Dream Home currently has one employeecovering many of these, which makes it difficult to do all of them well, but they do selladvertisements and sell magazine subscriptions or current expenses could not be paid.Marketing seems quite a bit weaker as it is not anyone persons core responsibility, nordoes a good marketing campaign pay next month’s rent and a company’s payroll. Finally,we have printing and delivery in larger organizations this is called circulation, which are 5
  6. 6. contracted out due to the magazines size. However, here is how the current operations !"##$%&&()*"$+,-"./0"1"*20 !"##$!%&()*+,-.can be summed up in big yellow blocks.Notice the intentionally disconnected feel above and no marketing. Even if the sameperson is conducting the business operations, he/she is not meeting the changingcustomers changing needs. • Design (detailed) the process to meet the customer needs (isixsigma.com, 2010)Technology can help this process along the way immensely. !"##$!35*6(./)0,*$-0$72829.,"$ .2$23-0+2-"&$:0(+$0,#.,"$2,&$ !"##$%&"()*"+",-*$.,$/(.,-$0($ 2//*$22.#25#"$-;(038;$.<3,"*$ 0,#.,"$10($23-0+2-"4$ 2,&$%,&(0.&$72(="-$2,&$ 7"-"("&$/2>?2##$-0$?"5*.-" The virtuous circle @(2,&$2,&$A0,-",-$72(="),8$ is allowed to flow -0$.+/(0"$.*.5.#.->$-0$ /0-",)2#$*35*6(.5"(*$2,&$ 2&"()*"(*$Here are some of the areas where business operations can be improved by focusing on e-business and e-commerces solutions to improve processes and complete tasks with moreself-service (Canadian Business Network, 2011).- Cut transaction times- Trade in digitized goods and services 6
  7. 7. - Electronic banking and payment systems- Commercial transactions conducted by Internet- Customer service- Compete globally with your website against businesses of all sizes without setting upoffices in other countriesIf the business side of this operation is going to stay small many new features will needrely on self-service e-commerce payment platforms for ordering and fulfillingadvertisements and subscriptions, paying for both, and the availability to read the contenton a digital platform or website based on the readers preference via subscription model ofthe readers choice (paywall thresholded website and blog, iBooks, Android market,Kindle market). We will get her by developing each delivery method with a contractorbased first on the monthly pdfs created for the magazine converted into paid apps an thenwith the launch of a new website featuring a paywall and built in customer supportfeatures for both readers and advertisers. The ability to scaleably deliver moreadvertisements on new content channels without incurring the costs associated withtradition printing is the value proposition to our new process model.This will free up the business operations to be able to focus on brand and contentmarketing and developing longer-term relationships with strategic advertisers andpartners and allow the virtuous circle to drive positive feedbacks into the businessoperations (Gupta, 2011). • Verify the design performance and ability to meet customer needs (isixsigma.com, 2010)Reevaluate digital business operations in a year after launch in order to make sure scopecreep has not taken it beyond its intended e-business goals. 7
  8. 8. Use of (DMAIC) for analysis of the Content CycleFor the content cycle of the publishing process we will assess it with Define, Measure,Analyze, Improve, Control (DMAIC) (isixsigma.com, 2010) as the content process is notnew or radically different than what is currently being done by the content creators andeditors. This is a useful tool to discover how the content cycle currently operates andwhat constraints may present if improve strategies are undertaken. • Define the project goals and customer (internal and external) deliverables (isixsigma.com, 2010)Our goals for Ur Dream Home is to make the publishing process platform neutral (notjust content produced for a glossy magazine) and create a new delivery means digital, forcurrent and new content products and that added revenue areas are engaged with theseadditional products and new readers are engaged with and enjoy reading our content.Externally, readership desires a publisher to engage them where they are during theirchanging busy reading schedules, online: at work early morning; before lunch; before therush to the door; and on the new devices they own, mobiles and tablets. Internally, themagazine risks are great and come from the potential for contributors and editors tobacksliding into old habits, job tasks, and methods of operation if their daily tasks arechanged. • Measure the process to determine current performance (isixsigma.com, 2010)Question must be asked about how articles make it through Ur Dream Home’s currentcontent cycle from start to finish and brainstorm a bit. Who is chosen to write the article?When is it due? Who edit it? What is the turn around time from editor to layout? Howlong does it take for the content to be laid out of on a specific by a page designer? Whereor when does this article get published in the magazine? Where is the article read and bywhom? These question all must be measured regularly and timed as the digital publishingcycle requires much faster turnarounds than tradition magazine publishing and is morelean by nature up front before it gets bogged down in new forms of, “techno-slows.” The 8
  9. 9. point is to create a reasonable benchmark for times it takes to conduct elements of eachsteps task. • Analyze and determine the root cause(s) of the defects (isixsigma.com, 2010)The root cause is the current content cycles one-way communication and task-orientedstructure. For example: An Editor assigns a story to a contributor. The contributorsresearches and writes this new article. The editor edits the new article. A page designerlays out the article on a page with art photos and advertisements. The magazine gets readby it’s paying subscribers. 3*456&()&*+,-.)&5%&()& /)")*+-(&*%0&1+#)&()& !""#$%&()&*+,-.) 20#&()&*+,-.) 7*$) !+,-.)&8"&/)*0&#%&9*$*:#%) *+,-.)However, this leaves little room for the positive creative feedback loops of an openpublishing environment where communication goes in every direction and the needs asdesires of staff and readers are in better sync with more conversation. This lack ofconversation is the primary defect of this sub-process of this organizations publishingprocess. • Improve the process by eliminating defects (isixsigma.com, 2010)The publishing process for Ur Dream Home must be improved; however, the changes arenot radically different from the old ways. The primary process difference is the greaterlevel of feedback and communication heading in the direction of story creation, so thatevery member of the editorial group as well as readers are playing a role in finding themost interesting stories for the next bi-monthly magazine and the new digital products.The other changes that have been made add the steps layout for web and publish fordigital and to allow a new blog to be a place for quick interesting notes to be allowed toreturn to step of assigned article if further details may be considered interesting additionsto a future magazine or online edition. 9
  10. 10. 6*738&()&*+,-.)&3%&()& /)")*+-(&*%0&1+#)&()& !""#$%&()&*+,-.) 20#&()&&*+,-.)&3+&4.3$&53" 5*$) !+,-.)&9"&/)*0&#%&:*$*;#%)&<+#% *+,-.) 6*738&()&4.3$&53"&3+& *+,-.)&3%&1)45*$)&*%0& !+,-.)&3+&4.3$53"&9"&+)*0&3%& =*74)&+)*""#$%&.3%$&>3+=& A)4"#)B&#<*0B&C#%0.)B&!%0+3#0B&&*& ?)+"#3%&>3+&%)@&=*$*;#%)&& =34#.)& New open editorial communication structure with Platform Neutral PublishingThis will open the content cycle up to become platform neutral and still be focused on thehighest level of product for the content. However, the volume of work each team memberon the content cycle will increase, but the stature and value propositions of the magazinewill increase. The basic ratio to understand here is much more lean in time per contentitem, more content creation expectations per person per month, but at the same pay, untilthe new digital channels are revenue positive. This will remain a huge point of strainbetween the editorial and the business side until a new equilibrium is reached. However,the authors will become more influential and known as the churn a higher volume ofwork. • Control future process performance (isixsigma.com, 2010)The future is difficult to tell. However, the newer ways to consider future processimprovements will be based on the greater performance metrics available in the onlinecontent production space. The future process will have much more data for performanceevaluation. However, the trick is to realize that quality is actually more important thanquantity. The new digital streams will allow Ur Digital Home to continue to (CanadianBusiness Network, 2011).- Cut transaction times- Compete globally with your website against businesses of all sizes without setting upoffices in other countries 10
  11. 11. This will occur via web-based content. These new delivery models will cut costsassociate with adding addition readers, raise revenue, and reduce transaction times andallow Ur Dream Home to compete with modern interior and living magazines throughout the world in the English language not only Ireland and be Ireland’s voice on thissubject world wide.The evaluating and improving the publishing process was the scope for analyzing UrDream Home’s two sub-processes of “business operations” and its “content cycle.” Themagazine can use a digital business strategy that works within a flexible processimprovement framework like Lean / SixSigma. A Lean / SixSigma framework fordeveloping a platform neutral operation was the objective and grow its business withgrowing its staff substantially. Training however would be key given that this is a humancapital-intensive enterprise.Is Lean /SixSigma the next big thing for publishers? I am doubtful of this due to its morerigid edges in-person implementation; however, its relentless focus on time managementand quality control are could be helpful. This would be especially so in the case of verylarge publishers where the two sub-processes discussed above are much less cut and dryas many smaller person-by-person efficiencies would need to be wrung out of both sub-processes. 11
  12. 12. BIBLIOGRAPHYBenkoil, D. 2011. Tear Down the Wall Between Business and Editorial! PBS.org Mediashiftblog 7 December. [Online] Available from:http://www.pbs.org/mediashift/2011/12/tear-down-the-wall-between-business-and-editorial341.html [Accessed 19 December 2011]Brutu, M. The Improvement of Processes Quality in Organisations Using the Six Sigma Concept.Annals of the University of Petrosani Economics, 2010, Vol. 10 Issue 1, p37-42, 6p.Canada Business Network, 2011. What is e-business? [Online] Available from:http://www.canadabusiness.ca/eng/145/148/4325/ [Accessed 19 December 2011]Davenport, T. 2008. Why Six Sigma Is on the Downslope HSR Blog Network 7 January. [Online]Available from: http://blogs.hbr.org/davenport/2008/01/why_six_sigma_is_on_the_downsl.html[Accessed 19 December 2011]Gupta, S. and Armstrong, K. and Clayton, Z. 2011. Social Media. Harvard Business Review,Note. 510-095.iSixSigma, 2010. DMAIC Versus DMADV [Online] Available from:http://www.isixsigma.com/index.php?option=com_k2&view=item&id=1252:&Itemid=111[Accessed 19 December 2011]Madison, D. (2005). Process Mapping, Process Improvement and Process Management.California: Paton Press. [Online] Available From:http://books.google.com/books?id=n0k0Rbkbq3YC&printsec=frontcover#v=onepage&q&f=false. [Accessed 19 December]Ur Dream Home, 2011. [Online] Available from: http://urdreamhome.ie[Accessed 19 December 2011]Henk de Koning, Ronald J.M.M. Does, Arjan Groen, Benjamin P.H. Kemper, (2010) "GenericLean Six Sigma project definitions in publishing", International Journal of Lean Six Sigma, Vol.1 Iss: 1, pp.39 – 55. 12

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