D07 Project Charter

Define Project Boundaries

Deliverable 2D

Define Module Roadmap
Define Measure
1D – Define VOC, VOB, and CTQ’s 5M – Document Process
2D – Define Project Boundaries 6M – Prioritize List of X’s
3D – Quantify Project Value 7M – Create Data Collection Plan
4D – Develop Project Mgmt. Plan 8M – Validate Measurement System
9M – Establish Baseline Process Cap.

Control Analyze
14C – Create Control System
15C – Finalize Project Documentation 10A – Determine Critical X’s

Improve Green
12I – Prioritized List of Solutions 11G – Identify Root Cause Relationships
13I – Pilot Best Solution

Deliverables – Define
Primary Secondary V1.2

# Deliverable Deliverable Concept & Tasks Tool(s) Tool(s)

1D Define A project is started because a customer (internal or external) • VOC • Affinity Diagram
VOC, VOB and needs some problem to be solved. Deliverable 1D obtains Worksheet • Stratification
CTQs customer input to understand the problem(s) that the customer is tools (Pareto
experiencing so that a project can be started. In addition to and other basic
defining the problem, we also need to understand how the graphs)
customer defines product acceptability (specifications).

2D Define Project Once we understand the defect that needs to be improved (project • Project • Included /
Boundaries Y), define the project boundaries and components of the project. charter Excluded
This includes a well written problem statement, identifying what • SIPOC • Elevator Speech
process produces the defective item, how much improvement we
will make, when it will be done, etc. This information is
summarized in the project charter. Portions of deliverables 3D and
4D will also be on the charter.

3D Quantify Project Determine the benefit to the customer and to JEA for improving the • Project
Value process. Internal customer benefits are typically hard or soft $ Benefit
savings, productivity improvements, and employee satisfaction. Document
External customer benefits are typically customer retention,
customer satisfaction, and price and/or share increase. Deliverable
3D documents these benefits.

4D Develop Project To effectively manage a project, the GB/BB needs to identify team • ARMI • Faces of
Management members, effectively interface with the project stakeholders, plus • Project resistance
Plan develop and manage to a project plan (milestones and timelines). plan • Stakeholder
This plan should be developed and shared with all stakeholders. • Fist of five analysis
• Influence
strategy
• 3D’s

2D - Define Project Boundaries
Primary Secondary
# Deliverable Deliverable Concept & Tasks Tool(s) Tool(s)

2D Define Project Once we understand the defect that needs to be • Proje • Included /
Boundaries improved (project Y), define the project boundaries and ct Excluded
components of the project. This includes a well written chart • Elevator
problem statement, identifying what process produces er Speech
the defective item, how much improvement we will • SIPO
make, when it will be done, etc. This information is C
summarized in the project charter. Portions of
deliverables 3D and 4D will also be on the charter.
Steps to Complete Deliverable:
1. Use the VOC, VOB, and CTQ information from deliverable 1D, complete the Project Charter CTQ
section.
2. Draft a Problem Statement containing the 4 key elements and enter this on the Project Charter.
3. Use the SIPOC, Included/Excluded, and Elevator Speech tools as needed to further refine the Project
Scope.
4. Complete the Goal Statement and Process Map Number sections of the project charter.
5. Enter the Process Capability, Project Stakeholders, Project Timeline and Estimated Benefits
information if available. If unknown at this point, enter and/or update these during deliverables
3D, 4D, and 9M.
6. Although deliverables 3D and 4D are listed as subsequent deliverables to 2D, the information from 3D
and 4D is reflected in the project charter of 2D. As such, all three deliverables are often pursued
simultaneously instead of sequentially.

Objectives –
Upon completing this module, students should be able to:
• Name the 4 elements of a problem statement
• Construct a problem statement from “real world” data
• Create a SIPOC
• Create an Included/Excluded worksheet
• Create an elevator speech
• Construct a goal statement from “real world” data
• Apply the green, yellow, and red color codes to the project
cycle time section of the project charter
• Fill in a blank charter using information from this and other
modules

Process Improvements

• Should “everything” be a DMAGIC project? NO!!
• Existing Processes
o Some solutions are so obvious they are “go-do’s”
o DMAGIC is a methodology to improves existing process when a
solution isn’t obvious or when multiple solutions exist
o Mgmt. directive to use a specific solution for various reasons
• New Processes
o Processes that don’t exist are DFSS (DMADV) candidates
o When a process can not be further improved because it has
reached it’s underlying mechanical limitations
(entitlement), capital project improvements are often required
(also DMADV)

A Good DMAIC Project:

• Improves an existing process
o Identify a process Q or P in your area that needs improvement
 Management is responsible for making processes run
better, faster, etc. TargetSmart should not be something “in addition
to” this responsibility. It is a methodology to do this work better.
• Has a single defect
o Avoid projects “to fix this, and this, and this,…”
• Does not have an “obvious” solution
• Can obtain data frequently
• Is important to the business (you/Champion/VP/etc.)
• Can be completed in 2-5 month’s

A Poor DMAGIC Project:
• Has multiple and/or unclear defects listed (GB/BB and team is
confused on what to fix and gets bogged down)
• Already has a solution (a “go-do” project)
o “My project is to implement/create a new _____”
Common
o “The lack of a ____ causes ____”
• Is a series of known tasks to be executed
o “My project is to research ____, perform a cost analysis and …”
• Is not important to the business (lack of urgency)
• Has slow/hard to get data (hard to show improvement quickly)
• Uses cost as the defect (vs. the true underlying defect)
• Is outside your area (low team motivation)
• Is scoped too large or small (too complex/waste of team’s time)
Common

Why Not Use Cost as a Defect?

• High cost is certainly a valid reason to identify processes
for improvement. However, excess cost (COPQ) is
usually a result of the process defect, not the defect
itself.
o e.g. Process “A” and “B” both cost $200k/yr to run. Which has the
higher Cost of Poor Quality? Which do you improve first?
 (If $ on a cost sheet were the only concern, we would work both)
• Processes with no defects still cost money to operate
o Consider a process that has been improved to the point of >6
operation but has a cost of $195k/yr. 2 years later, inflation raises
this “perfect” process to above the desired $200k/yr cost.
 Has the defect returned?
 How do we improve the process?

Why Have a Project Charter?

• A Project Charter Describes…
o The Purpose and Plan for the project
o What is the defect
o The scope of the project
o The process to be improved
o The Improvement goal
o Estimated project benefits
o Key players and their roles

Why Have a Project Charter?

• A Project Charter Helps…
o Develop clarity on the project
o Provide Direction for the team
o Keep the team “on task”
o Avoid “mission creep”
o Provide an evergreen roadmap for the project

Where is the Project Charter template?
15 Deliv template.ppt

Project Charter
Customer CTQ(s): Describe customer CTQ
{Project Map Number: Number here Here}
Process
Name & No.
(customer need/defect and spec limit.)
Black Belt: Name here
Problem Statement: List the 4 elements of a Process Owner: Name here
problem statement: Champion: Name here
* Defect identification Implementation Coordinator: Name here
* Magnitude of the defect (events/unit time, etc) Data Coordinator: Name here
* Where is the defect (location/group/segment) Team Members:
* Why this project is important to work now Name & function here
($, strategy support, etc) Name & function here
Name & function here
Project Scope: Name & function here
List project/process boundaries here Name & function here
Goal Statement: Increase(/decrease) the {primary Project Timeline:
metric} from {baseline state} to {improved state} by Assigned Define Measure Analyze Green Improve Control
{date} without negatively impacting {secondary
Sched Date Date Date Date Date Date Date
metric}.
Actual Date Date Date Date Date Date Date

Baseline Metric Performance (Time frame here):
Short Term Long Term
Zbench x.x x.x
Expected Benefits:
Hard Savings –$ xxx K
15 Deliv
DPMO xxxxxx xxxxxx Soft Savings –$ xxx K
Other Benefits:
template.ppt
List benefit here
List benefit here

Deliverable 2: Define
Improve Computer Delivery Time Proj. No. 12345
Customer CTQ(s): Configured computer Process Map Number: 1234
delivered to new employee within 10 working days
Black Belt: I. Cantwait
Process Owner: Weneedta Getbetter
Problem Statement: From 7/1/07 through
Champion: Ima Gonnahelp
6/30/08, new JEA employees located in downtown
Implementation Coordinator: Iwill Putinplace
Jacksonville received their configured
Data Coordinator: Ilove Numbers
laptop/desktop computer at an average of 11.0 days
Team Members:
(standard deviation = 2.04) vs. a 10 day USL. This
John – Installer
translates to an estimated productivity loss of
Paul – Installer
$225K/yr.
Project Scope: George – Supervisor
Includes new hires and transferred employees to Ringo - Purchasing
the downtown tower and CCC. Excludes all other
locations or electronic
Project Timeline:
Goal Statement: Decrease the average computer Assigned Define Measure Analyze Green Improve Control
delivery time from 11.0 days to 9.0 days by 11/20/08 Sched 7/1/08 7/15/08 8/30/08 9/30/08 10/7/08 10/20/08 11/20/08
without negatively impacting new computer inventory
Actual 7/1/08 7/12/08 9/5/08 9/28/08
or expediting costs.

Baseline Metric Performance (7/07-6/08): Example charter
Expected Benefits:
Hard Savings – $15 K for project in
Zbench -0.72 -0.50
Soft Savings – $225 K Green phase
DPMO 763,253 692,088
Other Benefits:
Internal Customer Satisfaction Scores

Deliverable 2: Define; SIPOC
Suppliers Inputs Process Outputs Customers
??
?? ?? ??
??
Process
?? ?? ??
Description
??
?? ?? ??
??
??

Project Project
Boundary Process Steps Boundary

?? ?? ?? ?? ??

Project Charter
Process
Name & No.
* Magnitude of the defect (events/unit time, etc) This is our
Data Coordinator: Name here
Team Members:
* Where is the defect (location/group/segment)
* Why this project is important to work now Name & function here focus
metric}.

Short Term Long Term Expected Benefits:
Zbench x.x x.x Hard Savings –$ xxx K
Other Benefits:
List benefit here
List benefit here

What is a Problem Statement?

• The Problem Statement is a crisp description of the
customer/business problem or opportunity available
o Will be directly linked to the VOC, but may or may not use the same
units of measure as the VOC
 e.g. A project to reduce customer hold time may measure the defect as
wait time (continuous) or proportion waiting over 4 min. (discrete)
• The Problem Statement does NOT contain:
o Proposed solutions or a statement of the suspected key X(s)
o A description of the project goal performance level
 The project performance goal is described in the goal statement. The
project goal may or may not be identical to the customer specifications.

Problem Statement Elements

• There are 4 parts to a well written problem statement:
o Defect identification
 Incorrect billing quantity, excessive cycle time, etc.
o Magnitude of the defect
 Proportion defective, Avg. cycle time vs. goal, etc.
o Where is the defect
 Location, affected group, market segment, etc
o Why this project is important to work now
 Financial gain, strategy support, etc.

Building A Problem Statement

• Defect identification (describe the defect to be improved)
o e.g. 1: Excessive customer wait time
o e.g. 2: Low pH probe life
• Magnitude of the defect (events/unit time, etc)
o e.g. 1: 12% of Customers wait time exceeds 4 minutes
o e.g. 2: pH probes currently last an average 25 days vs. the
desired 60 days before failure

Building A Problem Statement

• Where is the defect (location/group/segment)
o e.g. 1: 12% of Customers calling (800-xxx,xxxx) have a wait time
exceeding 4 minutes
o e.g. 2: pH probes placed in effluent water service at NGS
currently last an average 25 days before failure
• Why this project is important to work now ($, strategy
support, etc)
o e.g. 1: 12% of Customers calling (800-xxx,xxxx) have a wait time
exceeding 4 minutes. This project needs to be pursued at this
time in order to support current strategy goals.
o e.g. 2: pH probes placed in effluent water service at NGS
currently last an average 25 days before failure. This represents a
COPQ of $200k/yr.

Example Problem Statements
• The 0.34ppm Chlorine standard • The variability of the water
deviation of the water arriving leaving Ridenour is high.
at the customer’s house is Customers complain of
excessive. COPQ from this Chlorine smell at times, and
defect is $25k/yr plus poor Sulfur smell at times. We need
customer satisfaction related to to improve this by increasing
occasional high Cl2 odor/taste. the degassing time.

• What makes this a good • What makes this a poor
example? example?

Problem Statement Exercise

• Form into teams of 3-4.
• Select one of the team member’s project and create a
Problem Statement for that process
• Alternative: Rewrite the following into a proper Problem
Statement
o No matter how many times employees have been reminded, they
don’t seem to remember to wear their safety glasses while at
Buckman. Records from March and April show that employees
wore their safety glasses only 70% of the time that they
should, and there doesn’t seem to be any effort to improve.

10
Min

Project Scope - Description

23

Project Charter
Process
Name & No.
This is our
Project Scope:
List project/process boundaries here
focus
metric}.

Other Benefits:
List benefit here
List benefit here

What is Project Scope?

• The Project Scope statement describes the boundaries
of the process the project will improve
o Provides a common understanding among the stakeholders of
what is and is not included in the project
• Project Scope will describe items such as:
o Which locations are involved
 e.g. Includes NGS, excludes SJRPP
o Which groups are involved
 e.g. Includes new service customers, excludes all others
o Which process steps are involved
 e.g. Includes the process steps associated with routine
billing, excludes establishing new service and discontinuing existing
service

Why is Project Scope Important?

• Projects with appropriate scope move quickly
• Projects with large scope (“Boil the Ocean”)
rarely proceed smoothly
• As project scope increases:
o “Success” often requires fixing more than one defect
o “Success” requires a different solution to the same defect at
different locations – multiple improvement strategies, multiple
control plans, multiple training programs, etc.
o Project Cycle time increases!!!
o Six Sigma, the Belt leading the project, and the
team as a whole are viewed as slow and ineffective

When Do You Manage Scope?

• Project Assignment
o When a project is first assigned, clearly defining the defect and
project scope are vital! Most other define phase work (team
selection, COPQ, project timeline, etc.) are determined by these.
• Early Define Phase Meetings
o Early team meetings are often filled with energy to fix more than
one defect “while we are at it”. Be wary of “scope creep”!
• Mid-project changes
o Mid-project scope reductions are sometimes difficult to
accomplish. Process Owners and Champions are expecting
success on the original scope. They can leave stakeholders
feeling “the job wasn’t done right”.

Determining Project Scope

• Defining the project scope begins in Deliverable 1 with
project Y data stratification & segmentation. It is
appropriate to refine it in Deliverable 2.
o e.g. Is the project about reducing the proportion of customers who
do not pay their bills within 30 days, or reducing the proportion the
customers whose payments are late enough to reach service
termination (a subset of customers who do not pay within 30
days)??
• Use the following tools to refine project scope
o SIPOC
o Included/Excluded
o Elevator speech

What is a SIPOC?

• SIPOC is an acronym standing for
“Suppliers, Inputs, Process, Outputs, Customers”
• A SIPOC is a high level map of the process which will be
improved (could also be described as a map of the
process generating the defect of concern)

S C
U U
P S
P T
L Inputs Process Outputs O
I M
E E
R R
S S
30
©2006, JEA™;
All Rights Reserved

Processes
• All activity takes place in terms of a process
o The quality of the process determines the quality of the output
• Shocking lessons
o #1: Most people do not think in terms of processes.
They would rather think in terms of isolated events.
o #2: When convinced of the
value of thinking in terms
of processes, most
people still don’t think
in terms of processes.
o #3: The word “process”
generates fear and resistance.

Why Create a SIPOC Map?
• To develop a high-level view of the process

• To avoid scope creep

• To highlight areas for improvement

• To ensure customer focus

SIPOC Definitions

• Supplier: Internal or External - whoever provides the
input to your process
• Input: The item (tangible entity or data) that a process
uses to produce an output
• Process: A repetitive and systematic series of actions or
operations whereby an input is used to achieve an
outcome, product, or defined goal
• Output: The material or data that results from the
operation or a process
• Customer: Internal or External - whoever receives the
output of your process

SIPOC: Inputs

Labor
Material
Ideas Process
Information

Environment

SIPOC: High-Level Process View

Process

• A high-level view is often captured as a top-level flowchart

Step 1: Step 2: Step 3: Step 4:
Bottling Labeling Inspecting Packaging

SIPOC: Outputs

Physical products

Documents

Process Information
Services

Decisions

SIPOC Components
• Suppliers/Inputs • Outputs
o Where does the information or o What product does this
material you work on come process make?
from? Who are your suppliers? o What are the outputs of this
o What do they supply? process?
o Where do they affect the o At what point does this process
process flow? end?
o What effect do they have on • Customers
the process and on the o Who uses the products from
outcome? this process?
• Process steps o Who are the customers of this
o What happens to each input? process?
o What conversion activities take
place?

How to Create a SIPOC

1. Name the process
2. Brainstorm and identify the process steps
3. Identify, name and order the major process steps
4. Clarify the start and the stop (boundaries) of the process
5. List key inputs and suppliers
6. List key outputs and customers

Remember – the purpose of a SIPOC is to define
project boundaries, not describe the process in detail. A
full process map will be developed in Measure.

SIPOC Example
Suppliers Inputs Process Outputs Customers
Manufacturer Copier Copies You

Office Supply
Company Paper Making a File
photocopy
Toner Others

Yourself Original

Power Company Electricity

Process Steps Boundary Boundary

Put Close Lid Adjust Press Remove
original Settings START originals
on glass and copies


SIPOC Exercise

• Select one of the team member’s project and create a
SIPOC for that process

Tip – Sticky notes work very well when creating a
SIPOC. It allows the team to brainstorm and
rearrange items with minimal effort.

20
Min

Project Scope –
Included/Excluded

“Included/Excluded” Description

• The Included/Excluded worksheet is a tool to facilitate
discussion of the project boundaries
• Can be used in conjunction with a SIPOC
• Instructions to complete the “Included/Excluded”
worksheet:
o Complete the worksheet in a team meeting
 Main value comes from team discussion & consensus
o Answer the What, Where, When, Who questions in sequence
o “Other” is for any miscellaneous entries

Included/Excluded
INCLUDED EXCLUDED

• What __________________ • _____________________

• Where _________________ • _____________________

• When __________________ • _____________________

• Who ___________________ • _____________________

• Other __________________ • _____________________


Example - Included/Excluded
INCLUDED EXCLUDED

• What __________________
Grease related SSO’s • _____________________
All other SSO’s

• Where _________________ • _____________________
Southside All other areas
• When __________________ • _____________________

• Who ___________________
All time periods included • _____________________
No time periods excluded

• Other __________________ • _____________________
Commercial and
Restaurant locations Residential locations

n/a n/a

Included/Excluded Exercise

• Select one of the team member’s project and create an
Included/Excluded worksheet for that project

15
Min

Project Scope –
Elevator Speech

What is an Elevator Speech?

• An Elevator Speech is a concise verbal description of
what the project is about.
• Imagine getting on an elevator with an EMT member
and they ask about your most recent project. You have
only a few seconds to describe your project, so you
must be brief and to the point. What would you say?
• Example Elevator Speech:
o “My team and I have a project to reduce the number of demurrage
days incurred to offload solid boiler feed products at NGS. Over
the past year, JEA experienced 20 demurrage days. Our goal is to
reduce this to two days per year or less by 12/1/08 for a savings
of ~$45k/yr.”

Elevator Speech Exercise

• Form into teams of 3-4
• Create an Elevator Speech for each member’s project

20
Min

Project Charter
Process
Name & No.
* Why this project is important to work now ($, Name & function here
strategy support, etc) Name & function here
This is our
Project Scope:
List project/process boundaries here
focus
metric}.

Other Benefits:
List benefit here
List benefit here

What is a Goal Statement?

• The Goal Statement defines the project’s improvement
objectives – “what will be improved and by when”
• The goal should be “S.M.A.R.T.”
o S = Specific
o M = Measurable performance
o A = Attainable
o R = Relevant to the project
o T = Time bound
• After defining Primary and Secondary Metrics, you will
learn how to use the standard goal statement

Primary and Secondary Metrics

• The “Primary Metric” is the metric being improved by the
project. It will have the same units of measure as those
expressed in the problem statement
o Number of Document transactions/hr
o Pump Repair Cycle Time
• The “Secondary Metric” is the metric that must not be
negatively impacted while improving the primary metric
o Proportion of Documents with information defects
o Pump Critical Dimensions within specs
• If your project has an efficiency related primary metric
(typically VOB), the secondary is often effectiveness
(typically VOC) - and vice versa

Primary and Secondary
Metric Examples
• Example 1: For a project with a primary metric of
reducing the proportion of incorrect customer bills, the
secondary metric may be to not increase bill processing
time
o Primary metric = effectiveness, secondary = efficiency
• Example 2: For a project with a primary metric of
increasing the life of a NGS pH probe, the secondary
metric may be pH probe accuracy
o Primary metric = efficiency, secondary = effectiveness

Standard Goal Statement

• When the primary and secondary goal statements have
been established, use them to complete the following
sentence:
• Increase/Decrease the {Primary Metric} from {Baseline
State} to {Improved State} by {Date} without negatively
impacting {Secondary Metric}.
• Is this a S.M.A.R.T goal statement?

Example Goal Statements

• Good examples:
o Decrease the proportion of telephone customers who are on hold
more than 4 min. from 12% to 6% by 12/13/08 without increasing
headcount.
o Increase the average pH probe life at NGS from 25 days to 60
days by 2/1/09 without negatively impacting the number of manual
calibrations required.
• Poor examples:
o Increase pump life by 60% by 2/1/09.
o Decrease the number of employee hours required to process a
document by instituting a new document sorting system.

Goal Statement Exercise

• Form into teams of 3-4
• Create a properly phrased Goal Statement for each
member’s project

20
Min

Remaining Project Charter Items

Baseline Metric Performance
Process Map Number
Project Stakeholders
Project Timeline
Expected Benefits

Project Charter
Process
Name & No.
These are
our focus
metric}.

Other Benefits:
List benefit here
List benefit here


• “Baseline” data is data for the project Y (and X’s if
available) over the recent past
• For a project to be completed in an acceptable cycle
time, it needs to have (at least some) “baseline” data
• How much data should you have?
o Ideally 12 months
o If less than 12 months data is not available, use what is available
 Key issue is to have some long term data. The length of time this
represents is unique to each project.
o If there is no baseline data available, consider postponing the
project launch until some baseline data has been gathered


• What do “Zbench”, “DPMO”, “Short Term”, and “Long
Term” mean?
o These are process capability terms which relate process
performance to customer specifications. These will be calculated
in deliverable 9M.
o Enter these values if known or obtain assistance to calculate them

Process Map Number

• JEA has an extensive set of process maps with P and Q
metrics
o Q’s are output parameters = project Y’s
o P’s are input parameters = project X’s
• The Y for your project should be the Q on the process
owners process map
• Document the process map number on the project
charter

Project Stakeholders

• A Stakeholder is anyone “touched” by the project. In
addition to the team members, this includes customers
and suppliers (internal and/or external).
• List the Project Stakeholders who will be actively
supporting the project on the Project Charter. When a
project is first launched, some of the Stakeholders may
not yet be identified.

Project Timeline

• Enter the project timeline by phase when known.
• The target timeline is 120 days for a complete DMAGIC
project. Use this overall cycle time unless it is
determined the timeline should be different.
• As each phase is completed, use a green, yellow, red
color code to highlight cycle time performance vs. the
schedule
o Green = Actual cycle time to date is equal to or ahead of schedule
o Yellow = Actual cycle time to date is 7 days or less over schedule
o Red = Actual cycle time to date is more than 7 days over
schedule

Expected Benefits

• “Expected Benefits” are a summary of the benefits which
the project will bring
o “Hard” financial savings
o “Soft” financial savings
o Non-financial benefits (e.g. customer satisfaction)
• Expected Benefits calculations will be covered in detail
in Deliverable 3D

Deliverable 2: Define
Improve Computer Delivery Time Proj. No. 12345
Customer CTQ(s): Configured computer Process Map Number: 1234
delivered to new employee within 10 working days
Black Belt: I. Cantwait
Process Owner: Weneedta Getbetter
Problem Statement: From 7/1/08 through
Champion: Ima Gonnahelp
6/30/08, new JEA employees located in downtown
Implementation Coordinator: Iwill Putinplace
Jacksonville received their configured
Data Coordinator: Ilove Numbers
laptop/desktop computer at an average of 11.0 days
Team Members:
(standard deviation = 2.04) vs. a 10 day USL. This
John – Installer
translates to an estimated productivity loss of
Paul – Installer
$225K/yr.
Project Scope: George – Supervisor
Includes new hires and transferred employees to Ringo - Purchasing
the downtown tower and CCC. Excludes all other
locations or electronic
Project Timeline:
Goal Statement: Decrease the average computer Assigned Define Measure Analyze Green Improve Control
delivery time from 11.0 days to 9.0 days by 11/20/08 Sched 7/1/08 7/15/08 8/30/08 9/30/08 10/7/08 10/20/08 11/20/08
without negatively impacting new computer inventory
Actual 7/1/08 7/12/08 9/5/08 9/28/08
or expediting costs.

Baseline Metric Performance (7/08-6/08): Example charter for
Expected Benefits:
Hard Savings – $15 K project in Green
Zbench -0.72 -0.50
Soft Savings – $225 K phase
DPMO 763,253 692,088
Other Benefits:
Internal Customer Satisfaction Scores

Project Charter Exercise 1

• Complete a Project Charter for the following scenario
o “Hi Sue, I have been meaning to talk to you. I was doing some
data analysis last week and found that the Cl2 level in water
arriving at the customer’s house has averaged 1.35ppm over the
past 6 month’s. The FDEP stipulates the minimum Cl2 content is
0.20ppm which is a long way from 1.35. I know that we have to
take into account that some days have a higher Cl2 level than
others so I calculated the standard deviation to be 0.31. If we can
shift the mean closer to the lower spec, we stand to save $25k for
every 0.10ppm of reduction. Would you be willing to take on a
project to get the average down to 1.0ppm?”

15
Min

Example 1 - Solution
Customer CTQ(s): Cl2 content in water leaving Process Map Number: Number here
Ridenour averages 1.0ppm.
Problem Statement: The Cl2 content of Process Owner: Name here
Ridenour’s water averages 1.35ppm vs. a goal of Champion: Name here
1.0ppm. This equates to a $100k opportunity for Implementation Coordinator: Name here
Cl2 savings. Data Coordinator: Name here
Team Members:
Includes the water leaving Ridenour and Name & function here
excludes all other locations or water Name & function here
contaminants. Name & function here
Goal Statement: Decrease the Cl2 content at Project Timeline:
Ridenour from 1.35ppm to 1.0ppm by 2/1/09 without
negatively impacting our ability to meet FDEP limits. Assigned Define Measure Analyze Green Improve Control
Sched 7/1/08 7/15/08 8/30/08 9/30/08 10/7/08 10/20/08 11/20/08

Actual
Baseline Metric Performance (2/08 – 7/08):
Zbench 22.9 3.71 Hard Savings – 100 $K
DPMO 0 103 Soft Savings – xxx $K
Other Benefits:
List benefit here
List benefit here

Project Charter Example 2

o “I have been looking at my budget and don’t like what I see. Our
cost to maintain the lime pumps is outrageous and I would like to
shave 20% off the $13,500/mo. we spend. I put the last 10
month’s of data into the file Lime pump cost.mtw for you to use.
Joe and Ruth are two mechanics that are pretty familiar with the
area so let’s use them as team members.”

10
Min

A charter should not be completed for the Lime Pump Cost
charter as presented. There is no specific process defect
outlined. Stating cost as a defect does not reflect a process
oriented problem solving methodology. Cost is a result of
the defect – not the defect itself.
It is certainly valid to start researching a project based on
the opinion that costs are too high, but there needs to be a
drilldown to understand what defect needs to be improved.
For example, a $500k/yr cost could represent a large,
small, or NO underlying defect within the current process.
Remember, COPQ is the Cost of Poor Quality. It’s not Cost
Is Poor Quality.

Project Charter Example 3

o “I have been looking at my budget and don’t like what I see. The
cost to maintain NGS lime pumps is outrageous and I would like
to shave 20% off the $13,500/mo we spend. The cost is mostly
related to the mechanical pump seals. They just don’t seem to last
like they should, with an average life of around 37 days with some
lasting only ~20 days. I put the last 10 month’s of seal life data
into the file Lime pump seal life.mtw for you to use. If we can get
them to the point where minimum life is 35 days I would consider
that a victory. Joe and Ruth are two mechanics that are pretty
familiar with the area so let’s use them as team members and
start on Sept 1.”

10
Min

Customer CTQ(s): Lime pump seal life meets Process Map Number: Number here
or exceeds 35 days.
Problem Statement: The Lime pump seal life at Process Owner: Name here
NGS currently averages 37 days vs. a desired Champion: Name here
minimum of 35 for any individual seal. This Implementation Coordinator: Name here
equates to $xxx/yr COPQ. Data Coordinator: Name here
Team Members:
Includes Lime pump seals at NGS, excludes Name & function here
all other locations or pumps Name & function here
Goal Statement: Increase the NGS lime pump seal Project Timeline:
life from an average 37 days to 58 days by 2/1/09 Assigned Define Measure Analyze Green Improve Control
without negatively impacting maintenance costs.
Sched 9/1/08 10/5/08 11/1/08 12/1/08 1/1/09 2/1/09 3/1/09
Actual

Baseline Metric Performance (12/07 – 8/08):
Zbench 0.35 0.27 Hard Savings – xxx $K
Other Benefits:
List benefit here
List benefit here

Project Charter Exercise 4

o “Hi George, I have been hoping to bump into you. I have a great
project I would like you to work on. My group has been looking at
the way we do our CAD drawings and are convinced it is
antiquated. MicroSquish has some new software in beta release
called “Be-a-CAD” that will probably increase productivity by
$100k/yr. We have tentatively agreed to be one of their beta test
sites in exchange for a 10% price break on the purchase price.
Since you have some experience in CAD systems, you are just
the person to help put together a well thought out transition plan
and have the new system in place 6 month’s from now”.

10
Min

A charter should not be completed for the Microsquish CAD
software proposal. This is not a DMAIC project. It may be a
very valid improvement to implement – it just isn’t a DMAIC
project.
When the business wants to implement a known solution, or
when the tasks to achieve an end goal are known and
obvious, this is a “just do it” project. Select an appropriate
task force leader and proceed.
DMAIC is used when the solution isn’t “obvious”. Rule of
thumb – if you ask 4-6 people who have a different
perspective of the problem what 1 thing they would do to fix
the problem, and you get the same answer, it is a “just do it”.
If you get several answers, use “DMAIC”.

Homework – 2D

and be prepared to show your results tomorrow
o A Process Owner at Pearl St. tells you “I just haven’t done a good
job of getting my crew on the road in the morning. Ideally, the jobs
would be assigned to all 40 employees and the trucks would be
departed within 30 minutes of start time. I have been tracking this
over the past 10 weeks and we seem to average 35 minutes. At
$17.50/hour, that is a lot of money spent just sitting. Today is Aug
1 and I would like to get this fixed as soon as possible. How soon
can you start the project?”
o You can leave the map number and team member names blank.
o See following Process Capability graph for supporting information.

Homework 2D Process Capability

Pearl St. Example
Customer CTQ(s): Each Pearl St. Crew heading Process
Name & No.
to a work location < 30 min of start time.
Problem Statement: Work crews at Pearl St. are Process Owner: Name here
taking an average 35 minutes to obtain work Champion: Name here
assignments and depart the yard vs. a 30 minute Implementation Coordinator: Name here
individual crew maximum. Reducing this to a 20 Data Coordinator: Name here
min avg. equates to $xxx/yr in lost productivity. Team Members:
Includes all Pearl St. work crews, excludes all Name & function here
other locations. Name & function here
Goal Statement: Decrease the work crew departure Project Timeline:
delay from an average of 35min to 20 min by 1/2/09 Assigned Define Measure Analyze Green Improve Control
without negatively impacting accuracy or
Sched 9/1/08 10/5/08 11/1/08 12/1/08 1/1/09 2/1/09 3/1/09
completeness of work assignments.
Actual

Baseline Metric Performance (5/08-7/08):
Zbench -2.39 -0.85 Hard Savings – xxx $K
Other Benefits:
List benefit here
List benefit here

Learning Check –
Upon completing this module, students should be able to:
• Name the 4 elements of a problem statement
• Construct a problem statement from “real world” data
• Create a SIPOC
• Create an Included/Excluded worksheet
• Create an elevator speech
• Construct a goal statement from “real world” data
• Apply the green, yellow, and red color codes to the project
cycle time section of the project charter
• Construct a blank charter using information from this and
other modules

D07 Project Charter

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D07 Project Charter