Business Process Improvement (BPI 7) Process Training Module

1
Business Process Improvement (BPI 7) Process
by Operational Excellence Consulting LLC
11/3/2011 – v2.0

2 11/3/2011 – v2.0
A process or value stream is a series of related activities which together
produce an output of value to the customer.
Process or Value Stream - A Definition

3 11/3/2011 – v2.0
Traditional Organizational Structure
 The Focus is internal to the Function or Organization
Management
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keeping the
boss happy
giving other
people work
Employees
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4 11/3/2011 – v2.0
Process-Driven Organizational Structure
 The Focus is on the Customer
Management
Process
Customer
Requirements
=
INPUTS
Customer
Satisfaction
=
OUTPUTS
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5 11/3/2011 – v2.0
Process-Driven Organization - The Starting Point
Function A Function B Function C
Input
Output
4. Everyone knows only his/her own
function's activities and tasks. As a
result, they make changes which
focus on the function, not on the
overall process performance
3. The function's borders
act as barriers and slow the
overall process, as work is stored at
the entry and exit points to each
function
1. There is no
complete
description of
the end-to-end process.
2. Functions start to make
documents
of their own sub-processes
for their own
purposes.

6 11/3/2011 – v2.0
Process-Driven Organization - Make the Process Visible
Input
Output
B6B5
A1
A3
B4
B3
B2B1
A2
C1
C2
C3
A4
5. Cross-functional teams are working
together and mapping the functional
activities and tasks, as well as the
interaction points.
6. The different functions start to
understand each others input
requirements, begin to see the overall
process flow, and identify initial
improvement opportunities.

7 11/3/2011 – v2.0
Process-Driven Organization - Process vs. Functions
Output
Input
A1 B2B1 C1
A3 B4B3A2 C2
B6 B5C3 A4
- Competence A
development
- Training
- Resource pool
- Superior relations
- Competence B
development
- Training
- Resource pool
- Competence C
development
- Training
- Resource pool
 Functions become competence centers - supplying
competence and resources to the processes
Sub-Process #1
Sub-Process #2
Sub-Process #3

8 11/3/2011 – v2.0
Business Process Improvements (BPI 7) – Table of Content
The main objective of the workshop is to help you improve the business by:
 Defining the Scope of a Process
 Mapping the Process
 Defining Process Measures
 Setting Process Targets
 Analyzing the Process
 Improving the Process
 Managing the Process
3.
Define
Measures
2.
Map
Process
1.
Define
Process

9 11/3/2011 – v2.0
Business Process Improvement (BPI 7) - Overview
Then the continuous effort of process
improvement begins:
 set targets
 analyze to see if and how targets are
able to be met
 improve the process
 manage process performance
Before focusing on process improvements:
 define the scope
 map the process
 define the measures
3.
Define
Measures
2.
Map
Process
1.
Define
Process

10 11/3/2011 – v2.0
Business Process Improvement - Management Involvement
Business process improvement teams need process owner and
management sponsor involvement at at least 5 stages of the BPI 7
Process.
 When starting the BPI 7 Process (Step 1)
 To gain commitment and ensure resources for process improvement
 After the initial process capture (Step 4)
 To agree on key performance indicators and targets
 After selecting the areas for improvements (Step 5)
 To agree the changes to the process (What)
 When creating the improvement plans (Step 6)
 To agree to and own the improvement plan(s) (How)
 When following up on process performance (Step 7)
 To ensure continuous improvement as needed

11 11/3/2011 – v2.0
A Method to Achieve
Operational Excellence
Step 1:
DEFINE PROCESS
3.
Define
Measures
2.
Map
Process
1.
Define
Process
Business Process Improvement Methodology

12 11/3/2011 – v2.0
Business Process Improvement - Objectives
By the end of this module, you should be able to:
 define the purpose of the process
 define its start and end points (scope the process)
 identify the customers of the process
 identify the output(s) of the process
 identify the supplier(s) of the process
 identify the input(s) of the process

13 11/3/2011 – v2.0
How to get started ?
Think of coming to work in the morning:
 How long does it take you?
 Where would you say the starting point for coming to work is?
 At what point would you say you had ‘arrived’?

14 11/3/2011 – v2.0
Business Process Improvement – Step 1: Define Process
 State the name of the process
 State the purpose of the process
 Identify a process owner / management sponsor
 Scope your process by identifying your starting point and end point
 Identify the customer(s) for the process
 Identify the output of what you do in the process
 Define the requirements of the output
 Identify your supplier(s)
 Identify the input for the process
 Agree your requirements for the input

15 11/3/2011 – v2.0
Step 1: Define Process - Example
PROCESS SCOPE:
Start Point: end-user reports defect or issue
End Point: end user has a satisfactory product
CUSTOMER: external customer (end-user)
OUTPUT: repaired or replaced product
OUTPUT REQUIREMENTS: product in fully working order immediately
SUPPLIER: customer - …
INPUT: defective product or issue - …
INPUT REQUIREMENTS: indication of defect or issue - …
PURPOSE: To resolve customers defect or issue
PROCESS NAME: customer issue resolution process
MANAGEMENT SPONSOR: technical support manager – Tracy Miller

16 11/3/2011 – v2.0
Group Work #1: Business Process Improvement - 1. Step
The Task:
 define the current process
On a Flip Chart share:
 your reasons for scope
 your view of the process purpose
 any learning points
 any concerns as to how to apply this step
of the method in practice?
20 Minutes

17 11/3/2011 – v2.0
Business Process Improvement - 1. Step Management Review
 Ensure that the identified process owner / management sponsor
is the correct person
 Brief the owner / sponsor on the work you have completed in
Step 1
 Agree how the owner / sponsor wants to be involved in the
project work
 Agree on the next management review session (at a minimum
after Step 4)

18 11/3/2011 – v2.0
Business Process Improvement - 1. Step Summary
 Defining the scope, as well as the input and output
requirements of a process, is important to ensure a firm
foundation for process improvement
 This module has provided you with a standard template for
doing this
 The need to brief and involve the process owner /
management sponsor at an early stage

19 11/3/2011 – v2.0
Continuous Process Improvement Methodology
3.
Define
Measures
2.
Map
Process
1.
Define
Process
A Method to Achieve
Step 2:
MAP PROCESS

20 11/3/2011 – v2.0
 To explain the reasons behind ‘process mapping’
 To show the link between a process map and a process
scope
 To introduce the elements and symbols of a process map
 To provide guidelines how to map a process
 To give you experience in producing your own process
map

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Why to map a Process ?
 Provides a common understanding of how the process
operates (activities & sequence)
 Provides a common understanding of roles and
responsibilities of each function
 Clarifies the interfaces between processes, technology and
people
 Helps a team analyze in detail each step in a process
 Provides a means for discussing problem areas
 Helps to identify improvement opportunities in a way which
considers the overall process

22 11/3/2011 – v2.0
Basic Elements of a Process Map
Main Flow of Process:
 Activities: the steps completed in the process
 Decision: poses a question and signals either an alternative path or
an inspection point
 Connector: Company internal or external connector to another
process
 Object Flow: the inputs and outputs which flow from one activity to
another

23 11/3/2011 – v2.0
Basic Process Mapping Symbols
Activity
Flow Direction
Decision
Process Flow Mapping Symbols
Connector
A
Start / End

24 11/3/2011 – v2.0
Additional Process Mapping Symbols
Additional Elements :
Delay Multi-Path Document
Database Inventory
Off-Page
Connector

25 11/3/2011 – v2.0
Process Mapping - Main Flow Example
A Process Map usually flows from left to the right.
Process Map Example
DecisionActivity
Off-Page
Connector
A
Start
Activity End
Word

26 11/3/2011 – v2.0
Process Role & Responsibilities
 Roles can be defined as
 name of the role (warehouse manager, purchasing, …)
 type of the role (A, R, C, I)
 The four types of roles are:
 A - Authority for the decision
 R - Responsible for action
 C - Collaborator in development
 I - Informed about progress in the process step

27 11/3/2011 – v2.0
Process Swim Lane Diagram
Angelica LA Market GRF Order Management Process – Part I “e-GRF and ABS Work Order Creation”
ServiceCustomerCRM/TM
ServiceCenter
Administration
Stockroom
Page 1
Cx requests
Item
Cx contacts
RSR & RSR
creates GRF
Draft
Cx contacts CRM
& CRM creates
GRF
Approved e-GRF
forwarded to SC
Administration
Cx contacts
Service
Department
Route Supervisor
or Service
Manager creates
e-GRF
e-GRF sent to
Cx for
Approval
Cx returns
approved e-GRF
Approved e-GRF
forwarded to SC
Administration
Review e-GRF and
perform Account
Maintenance /
Creation as
needed.
Create ABS
Work Order
with e-GRF
Request Date
and WO
Creation Date
Add ABS Work
Order # to e-GRF,
return updated e-
GRF to Originator
and forward for
internal
processing.
Receive new ABS
Work Order
e-GRF sent to
Cx for
Approval

28 11/3/2011 – v2.0
Preparation for the Process Mapping
 Become familiar with all existing and relevant process documentation
 Interview all associates who participate in the process
 Interview a sample of associates who perform the same activities or
tasks to fully understand what is really occurring in the process
 Compare the way different people do the same job to determine what
the best standard of operation should be
 Following completion check map with the people who provided input

29 11/3/2011 – v2.0
Build the Process Hierarchy
Top Level (6 – 12 Activities)
Next level
1. First task
2. Second task
3. Third task
An Activity
Each process can
be broken down
into another level
of detail
There is no limit
to the number
of levels

30 11/3/2011 – v2.0
Process Hierarchy - Example
Training
1. Select interviewers
2. Schedule Interviews
3. Book rooms
etc.
An Activity :
‘Arrange First Interviews’
Each process can
be broken down into
another level of detail
AppraisalInductionRecruit
A People Management Process

31 11/3/2011 – v2.0
How to Build a Process Map - Guidelines
 Build the map that is representative of the current process you have defined
in Step 1
 Start with the top level of the process and drill-down
 At any level keep the number of steps to between 6 and 12
 Go down to the level of detail that you know
 Remember you can always add more detail later
 All activities should be linked with an ‘output’ (object flow)
 Think activities - not functions (Prepare …, Document …)
 It is a good idea to build the map up using a whiteboard, paper or post-it notes
 Use an “Opportunity Log” to record discoveries of improvement opportunities
 Use software (PowerPoint, Visio) to support your process mapping

32 11/3/2011 – v2.0
Process Activity Template - SIPOC
Process: Production Line Implementation Responsibility: Plant
Activity: Investment Proposal Creation Authority: Engineering
Inputs Supplier Activities Collabora
tors
Outputs Delivery
Equipment list Global
Eng.
Creating investment
proposal
Investment
proposal
General
Name of the (sub)process,
which this activity belongs to.
Name of this activity.
Inputs, which are needed
to execute the activity.
Suppliers for
the inputs.
Detailed
activities.
Outputs, which are
required from a
successful activity.
Resources,
whose support
and participation
is needed to
successfully
execute the
activity.
Addressees for
the outputs.
Resource, who is
responsible for the
execution of whole
activity.
Resource, who has authority
to accept the result.
Global
Eng. Mgr.

33 11/3/2011 – v2.0
The Task:
 Map your Process
 level 1 for entire process
 level 2 for one sub-process or process step
On a Flip Chart share:
 your process map to the team by walking
through the process
 any concerns as to how to apply this step of
the methodology in practice
30 Minutes

34 11/3/2011 – v2.0
 In order to identify how we are doing things so that we can
improve, it is important to visualize the steps
 Visualizing what we do makes it easier for people to learn and
understand
 Process mapping provides us with the raw-material required for
process management
 If we don’t write down what we do it is impossible to
systematically analyze and improve
 We have provided guidelines on how to map a process

35 11/3/2011 – v2.0
Let’s have a Break

36 11/3/2011 – v2.0
3.
Define
Measures
2.
Map
Process
1.
Define
Process
A Method to Achieve
Step 3:
DEFINE MEASURE

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 To review measures generally and its role in process
improvement activities
 To demonstrate how to develop appropriate and meaningful
measures for a process
 To complete an exercise to define measures for your process

38 11/3/2011 – v2.0
Why do you need Measures ?
Measures are a basis for improvement:
 Measures allow you to set clear goals and monitor trends
 Measures show how effectively you use resources
 They provide the input data for identifying sources and analyzing
root causes of errors, allowing you to identify opportunities for
improvement
 Measures direct people’s attention:
......... what gets measured gets done.

39 11/3/2011 – v2.0
The Four Dimensions of Process Measures
Process measures should relate to
 Time
 Cost
 Quality
 Customer Satisfaction
... and ensure an effective balance between all four dimensions.

40 11/3/2011 – v2.0
How Measures are Often Collected
 Easy = often provides poor information
 Nice = adjusted to provide good results
 Right = difficult to get and often shows poor performance
e.g. Number of calls = easy
Customer opinion = difficult
... and may not be favorable !!!

41 11/3/2011 – v2.0
Functional vs. Cross-Functional Measures


Sales Production DC
Sales Production DC
Measures must reflect a
cross-functional process view
Requirements should come
from the customer and measures
should be aligned to meet those
requirements
Often measurements are based
on functional interests

42 11/3/2011 – v2.0
Measures and Process Hierarchy
 Just as your process fits into a wider process at a higher level,
your measures should fit into a higher level of measures also
 Measures of your process should be seen as part of the process
hierarchy
 For example
 the costs of your travel impact upon
 the costs of your process impact upon
 the profitability of your business unit impact upon
 the financial excellence of company

43 11/3/2011 – v2.0
Where to Place Measures
 Processes should be measured and controlled at potential
‘bottlenecks’ in a process: i.e. where
 the process flow is slowed down
 the entire process will not operate any faster than the flow through
this point
 Bottlenecks therefore have a significant impact on the overall
process performance
 Measures should help predict total process performance

44 11/3/2011 – v2.0
Where to Place Measures - An Example
Organization
CUSTOMER
PRODUCT DELIVERY PROCESS
Product Delivery
ORDER FULFILLMENT PROCESS
“Customer satisfaction in terms
of delivery on time”
“Shipments planned vs. actual”
“Incoming component quality”
Material

45 11/3/2011 – v2.0
What to consider when defining Measures
1. Clarify your objective. Be sure that everyone involved is clear on the purpose of
the measure.
2. Create an operational definition. A good operational definition is very specific and
descriptive, and will produce the same results no matter who is doing the
measure.
3. Design your data collection procedure. For each measure, document the specific
methods that must be used to collect data. The instructions should be so specific
that all individuals following them will use the same process and obtain the same
results.
4. Confirm the validity of your measure. Validity refers to the extent to which a metric
actually measures what it was designed to measure and drives the desired
behavior.
5. Document your definition and process to ensure standardization. It is critical that
your operational definition and data collection procedure be documented so that
the measure is standardized for use throughout the organization.

46 11/3/2011 – v2.0
20 Minutes
The Task:
 indicate on you process map where you
would place your measures
On Flip Chart share:
 the requirements of one of your measures
as defined by the template
of the method in practice

47 11/3/2011 – v2.0
 Measures are essential to be able to improve
 Measures should indicate overall process performance - they must be
based on process not function
 The measures should relate to
 Time
 Cost
 Quality
 Customer Satisfaction
... and ensure an effective balance between all four.
 Measures must be clearly defined, repeatable and valid
 Measures must be routinely used by people to improve the process

48 11/3/2011 – v2.0
3.
Define
Measures
2.
Map
Process
1.
Define
Process
A Method to Achieve
Step 4:
SET TARGETS

49 11/3/2011 – v2.0
 To review the importance of having clear targets
 To define ‘targets’ in relation to process improvement
 To discuss how to set appropriate targets for improvement

50 11/3/2011 – v2.0
Target Setting Definitions
 The actual performance of the measure = the current level of
performance
 e.g. 75% of deliveries are made on time
 Performance standard* = what our level of performance should be
 e.g. 100% of deliveries are made on time
 Target* = how much should be achieved by when
 e.g. 90% of deliveries made on time by 31st December
 *These should be agreed with the process owner / management
sponsor based on customer requirements, business requirements,
feasibility, internal or external benchmarking, … .

51 11/3/2011 – v2.0
Why Set Targets?
 Without targets we are limited to ‘wishing and hoping’
 Without targets we cannot know if we have achieved anything
 imagine going on a diet without setting a target ...
 Targets are needed to stimulate change - they provide a focus for
improvement of the process
 Targets can themselves help people be motivated by visualizing
the end point:
 climbing Mount Everest
 the four minute mile
 flying to the moon – Video Link

52 11/3/2011 – v2.0
30 Minutes
The Task:
 identify targets for your measures
 the actual, standard and target you have
set for the measure defined at stage 4
of the method in practice

53 11/3/2011 – v2.0
 At this stage you should consult the process owner / management
sponsor to review progress
 Brief the owner / sponsor on the work you have completed up to
Step 4
 Obtain feedback from the sponsor on mapping and possible
performance standards and targets for the measures developed in
Steps 3 and 4
 Agree next management review after Step 5

54 11/3/2011 – v2.0
 Target setting is an integral part of management - targets drive
the improvement activities!
 Targets prevent us from wishing and hoping and help move us
towards action
 Targets can inspire others
 Targets should reflect customer priorities as well as business
plans

55 11/3/2011 – v2.0
3.
Define
Measures
2.
Map
Process
1.
Define
Process
A Method to Achieve
Step 5:
ANALYZE PROCESS

56 11/3/2011 – v2.0
 Review why process analysis is essential before improving the
process
 Understand areas for process analysis
 Use analysis to challenge the current way the process
operates
 Select most valuable areas for improvement
 Introduce some basic tools for process analysis and
improvement selection

57 11/3/2011 – v2.0
Why Process Analysis
 To understand in detail how the process operates and where it
might be improved
 To understand the process enough so that the impact of change
can be predicted
 To understand the basic characteristics of the activities within the
process, such as
 Why they are performed?
 What contribution they make to the result of the process?
Process improvement is a key factor for
business success.

58 11/3/2011 – v2.0
The Process Model
To get results, should we focus our behavior on the Y or X’s ?
Y = f (X’s)
 X1, X2, ..., XN
 Input-Process
 Independent
 Cause
 Control
 Y
 Output
 Dependent
 Effect
 Monitor


59 11/3/2011 – v2.0
Areas of Process Analysis
OUTPUTINPUT
People Issues
Technology Issues
People
• Skills
• Attitudes
• Values
Organization
• Roles
• Responsibilities
Technology
• Supporting technology
• Technological fit
Process Flow
• Process map
• Activity links
• Process measure
Process Issues
ACTUAL PROCESS

60 11/3/2011 – v2.0
Process Issues - Part 1
 Analyze process performance in terms of measures
 time - can the process be done quicker?
 cost - how well are the resources used?
 quality - how well are requirements met?
 customer satisfaction - how well are outputs satisfying the
customer?
 Gain understanding of interfaces (inputs & outputs) to other
processes to assess the impact of improvement

61 11/3/2011 – v2.0
Process Issues - Part 2
 Identify those areas (activities) of the process that are the most
appropriate for improvement
 Minimize waiting times (bottlenecks)
 Minimize non-value-adding activities
 Improve value-adding activities
 Rework should not be built into a process - redoing work is non-
value-adding
 Consider if all the activities need to be performed or could be
combined
 Evaluate if some activities can be performed in parallel

62 11/3/2011 – v2.0
People Issues
 Do people have adequate skills/competencies to perform the activities?
 What level of personnel development would be required to improve
performance?
 Does individual performance targets fit with the process performance
targets?
 e.g. does sales targets fit with customer satisfaction targets?
 Could fewer resources be used to perform the activities - what are the
implications?
 Roles - do people understand their contribution to the overall process?
 Are responsibilities clearly defined?
 Are all functions really need to perform the process effectively?

63 11/3/2011 – v2.0
Technology Issues
 Does the technology support the process?
 Does the technology support only parts of the process?
 If different systems - can they talk to each other?
 Does the system provide the right measures?
 Is this the most appropriate technology for the process?
 Are systems duplicating data?
 Can IT solutions be reused for similar processes?
 Could activities be automated to improve process quality and/or
efficiency?

64 11/3/2011 – v2.0
Tools for Process Analysis
 Process Walkthrough
 Activity Assessment Review
(see attached worksheet)
 Value-add vs. Non-value-add
Activities
 Brainstorming
 Why-Why Analysis
 Cause-and-Effect or Ishikawa
Diagram
 Affinity Diagram
 Interrelationship Diagram
 Mistake Proofing & Poka-Yoke
 Double Team & Multi-Voting
 Impact – Effort Matrix
 Solution Selection Table
 …

65 11/3/2011 – v2.0
Activity Assessment Review
See attached Activity Assessment Worksheet for details
 Bureaucracy
 Duplication
 Value-added
 Simplification
 Automation and Mechanization
 Process Cycle Time
 Error Proofing
 Upgrading
 Language
 Standardization
 Supplier Relations
 Big Picture Improvements

66 11/3/2011 – v2.0
Process Walkthrough
 Hang your process maps on the wall
 Start from the start point of the process
 Go through each activity in turn to see if:
 the sequence of activities is logical
 activities can be reassigned to gain greater efficiency
 there are any duplications
 activities can be done earlier if at all
 all the roles are necessary
 systems are relevant for the process
 Challenge hard any rework
Angelica LA Market GRF Order Management Process – Part I “e-GRF and ABS Work Order Creation”
ServiceCustomerCRM/TM
ServiceCenter
Administration
Stockroom
Page 1
Cx requests
Item
Cx contacts
RSR & RSR
creates GRF
Draft
Cx contacts CRM
& CRM creates
GRF
Approved e-GRF
forwarded to SC
Administration
Cx contacts
Service
Department
Route Supervisor
or Service
Manager creates
e-GRF
e-GRF sent to
Cx for
Approval
Cx returns
approved e-GRF
Approved e-GRF
forwarded to SC
Administration
Review e-GRF and
perform Account
Maintenance /
Creation as
needed.
Create ABS
Work Order
with e-GRF
Request Date
and WO
Creation Date
Add ABS Work
Order # to e-GRF,
return updated e-
GRF to Originator
and forward for
internal
processing.
Receive new ABS
Work Order
e-GRF sent to
Cx for
Approval

67 11/3/2011 – v2.0
Value-Add Activities vs. Non-Value-Add Activities
 A value-add activity
 Contributes to satisfying customer requirements
 Is required to produce the overall output of a process
 Customer is ready to pay for the activity
 A non-value-add activity
 Does not contribute to satisfying customer requirements
 Not required to produce the overall output of a process,
however, required by regulation, directive, or instruction

68 11/3/2011 – v2.0
Why - Why Analysis
 Challenge the current way the process operates by asking the
question “why” about each activity:
 Why perform the current activity?
 Why perform it in the current manner or order?
 Why does it need to be performed by this function?
 Why does it cost so much to perform the activity?
 Why does it take so long to perform the activity?
 Why can be not automate the activity?
 …

69 11/3/2011 – v2.0
Why - Why Analysis – An Example

70 11/3/2011 – v2.0
Brainstorming
Brainstorming is used to generate a large number of ideas in a short
period of time.
 Step 1: Review the topic or problem to be discussed. Make sure the
entire team understands the subject of the brainstorm. Clarify if you are
looking for potential root causes or possible solutions.
 Step 2: Allow a couple of minutes for everyone to think about the task
and write down some ideas.
 Step 3: Invite the team members to call out their ideas, randomly or in
turns around the table. Make sure that the team builds upon each others
ideas (1 + 1 = 3), but do not allow discussions or evaluations.
 Step 4: Record all ideas, e.g. on post-its, and stick them on a flip chart
visible to everyone.
 Step 5: Continue with Step 3 and 4 until several minutes silence
produces no more.

71 11/3/2011 – v2.0
Cause-and-Effect or Ishikawa Diagram
Cause-and-Effect or Ishikawa Diagram is a systematic way of looking at the
causes and effects of the problem and how they are related. It organizes large
numbers of ideas into pre-defined categories, e.g. 4Ms & 1 E or 4 Ps.
4M’s = MEN
METHODS
MATERIALS
MACHINES
+ ENVIRONMENT
4P’s = PEOPLE
PRODUCT
PRICE
PROMOTION
Effect or
Outcome
Machines
Materials Methods
Environment
Trunk
Primary Causal Factor
Main Branch
Minor Branch
Second-Level
Causal Factors
Men
Problem Statement
(of identified GAP)

72 11/3/2011 – v2.0
How to use the Cause-and-Effect Diagram
 Decide/define the Effect or Gap to be analyzed
 Draw a horizontal line (the backbone of the fish) and to the right end
of this write the effect (= fish’s head)
 Brainstorm for all possible causes
 Group the causes under main headings (min. 2, max. 6)
 Put the main headings at the end of the major “side” bones
 Add other causes to smaller “off shoots” from the major bones
 Check that the diagram is complete and logical

73 11/3/2011 – v2.0
Why - Why Diagram
The Why–Why diagram can be used to uncover multiple causes of a problem,
until fundamental and actionable root causes are revealed. In addition, the
diagram helps the team to recognize the broad network of problem causes and
the relationship among these causes. It can indicate the best areas to address
for short- and long-term solutions.`
Problem Statement
(of identified GAP)
Apparent
cause
Root
cause
Apparent
cause
Apparent
cause
Root
cause
Why ? Why ? Why ?

74 11/3/2011 – v2.0
How to use the Why - Why diagram
Step 1: Write the problem/GAP statement down on paper and present it to
other team members. Remember that it is the effect that needs to be analyzed
- make sure it is clearly defined and understood.
Step 2: Ask "Why ?" this problem does or could occur. List all these causes on
notes and place them in a column immediately to the right of the problem
statement.
Step 3: Each of the cause statements now become a new problem statement.
Again ask "Why ?". Sometimes the question needs to be phrased, "Why does
this situation causes the problem?". Create another column of cause
statements. Show the relationships to the first column with arrows.
Step 4: Continue to turn each causes into a problem and ask "Why ?". Do not
stop until you reach an answer that is fundamental and actionable (procedure,
system, communication, training needs, and so forth).

75 11/3/2011 – v2.0
Affinity Diagram
An Affinity Diagram organizes large numbers of
ideas into their natural relationship and taps the
team’s creativity and intuition.
Step 1: Record the problem statement on a
separate Post-It note and place it on a flip
chart.
Step 2: Record each idea on a separate Post-It
note and stick it to on a flip chart.
Step 3: Look for ideas that seem to be related
and place then side by side, until all ideas are
grouped. Very important is that no one talk
during this exercise.
Step 4: Select a heading for each group and
write it on a separate Post-It note. Ensure that
every idea in a group aligns with the heading.
Make final adjustment if necessary. You can
talk during this step.
User demand is
more
sophisticated
and diverse
Quality is
becoming
globalized
Non-user
friendly
products are
unacceptable
Need for
providing
complete
service
Unreliability in
products is not
tolerated
TQM-aware
customers are
becoming
common
Demand for
high- quality,
low- cost goods
increasing
Technology is
no longer
“awe-inspiring”
Brand-
awareness does
not guarantee
customer loyalty
Market
different-
tiation is
becoming less
of an issue
Individual custom-
ization is
becoming
more of an issue
Need for
meeting all
requirements is
severe
Happy to pass
on good
product/ service
stories
Instant, intuitive
usability
becoming
requirement
Local service
must be available
immediately
Replacement
parts/ product
expected within
24 hours
Easily
contacted by
telephone or
fax
Extended
warranty
expected
Questions
answered
quickly and
correctly
Complete
customer
education/in for-
mation provided
Happier to pass
on poor
product/ service
stories
Low-tolerance
for inadequate
service; likely to
return prod

76 11/3/2011 – v2.0
Interrelationships Diagram
The interrelationship diagram is used
when the relationships among the effects
and the causes, or the objectives and the
methods, are complex and involved.
Step 1: Place all ideas in a circle on a flip
chart.
Step 2: For each idea, ask “Does this
idea cause or influence any other idea?”.
Draw arrows from each idea to the ones
it causes or influences.
Step 3: Analyze the diagram by counting
how many arrows in and out each idea
has. Note the number of incoming and
outgoing arrows for each idea “in/out”.
Step 4: Note which ideas have primarily
outgoing arrows. These are the basic
causes that need to be addressed to
resolve the problem statement.
3/3
5/0
2/1
5/1
0/5
1/3
2/2
0/5
3/1
Rejection of the
Statistical Thinking
Method
Lack of motivation
to change
Lack of support for
implementation
Lack of consensus
around the right
measurement indices
Data are not
easily accessible
Misunderstanding of
Paradigm
Lack of
Paradigm
Fear of technical
tools and methods
People have
competing
priorities

77 11/3/2011 – v2.0
Mistake-Proofing & Poka-Yoke
Human Errors are usually inadvertent
Poka (= inadvertent error) - Yoke (= avoid)
devices help us avoid defects, even when inadvertent errors are made.
Poka - Yoke help build Quality into Processes
1. Build quality into processes.
2. All inadvertent errors and defects can be eliminated.
3. Stop doing it wrong and start doing it right.
4. Don’t think up excuses, think about how to do it right.
5. A 60 % chance of success is good enough implement your idea now.
6. Mistakes and defects can be reduced to zero when everyone works together to
eliminate them.
7. Ten heads are better than one.
8. Seek out the true causes, using 5 W’s and other Root Cause Analysis tools.

78 11/3/2011 – v2.0
Mistake-Proofing - Five Mistake-Proofing Methods
Variation Control
 Use of special jigs, fixtures, or assembly tools that reduce the variation of how parts
are assembled.
Workplace Organization
 Error prevention by proper organization of the workplace or work station;
implementation of a 5S Visual Workplace Program.
Identification
 Errors are prevented by use of clearly written and easily available materials,
procedures, and tools.
Process Checks
 Performance of specific in-process checks to prevent errors.
Poka - Yoke Devices
 Ensures errors cannot become defects by automatically detecting error conditions and
immediately rejecting the part or shutting down the process. Poka-Yoke devices work
best when a specific step must be taken to re-start the process once a defect has
been detected.

79 11/3/2011 – v2.0
Mistake-Proofing – Poka-Yoke Examples

80 11/3/2011 – v2.0
Solution Selection - Double Team Decision Making
3 - 5 Suggestions 3 - 5 Suggestions
Board
Three Suggestions from
the 1. Double Team
Three Suggestions from
the 2. Double Team
3 - 5 Suggestions 3 - 5 Suggestions
1 2 3
4 5 6
|||| || ||||
| |||| | |||
Selection of the
2-3 most voted
solutions
5 3 1

81 11/3/2011 – v2.0
How to perform a Double Team Exercise
1. Present the problem/gap Team Leader ~ 2 min
2. Create ideas (3-5 ideas per person) All Individually ~ 10 min
3. Discussion and ideas in double teams Double Teams ~ 15 min
 choose the 3 best ideas
 hang on the wall
4. Present to other teams Double Teams ~ 5 min
 no discussion
5. Place solutions into groups Team ~ 5 min
6. Voting All Individually ~ 5 min
 choose the best solutions
 5 votes per person
 max 2 votes per solution
 max 1 vote per own solution
7. Counting the votes Team Leader ~ 5 min
8. Choose the solution Team ~ 2 min
Double team (“2&2”) is a team working technique which ensures everybody’s
contribution in creating ideas.

82 11/3/2011 – v2.0
IMPACT
EFFORT
High
Medium
Low
HighMediumLow
These opportunities are
usually good candidates
for the 1st Phase
These opportunities are usually
good candidates for the 2nd
Phase
These opportunities may require
additional analysis to see if they
are worthwhile
QuickHits–JustDoIt
Impact – Effort Matrix

83 11/3/2011 – v2.0
Solution Selection Table
SOLUTION # 1
SOLUTION # 2
SOLUTION # 3
SOLUTION # 4
Effectiveness Cost Time Resources avail.
70 %
90 %
50 %
65 %
20 000
52 000
24 000
18 000
14
5
12
15
Yes
Partly
No
Yes
Resource Availability Yes = enough resources (own)
Partly = not enough own resources, but more
available in the organization
No = no resources available in the organization
Time in Weeks
Costs in Local Currency

84 11/3/2011 – v2.0
30 Minutes
The Task:
 analyze your process using two or three
specific tools
 identify and select 2-3 major improvement
opportunities for your process
 your improvement opportunities
the method in practice?

85 11/3/2011 – v2.0
 Introduce the results of the process analysis to the process
owner / management sponsor
 Agree the most beneficial improvement options with the owner /
sponsor
 Gain commitment to the improvements
 Agree next management review at Step 6

86 11/3/2011 – v2.0
Process Analysis allows us to
 challenge the current way the process operates
 gain the knowledge required to consider any improvement
 select the most beneficial improvement options
Three areas of process analysis are
 process issues (activities)
 people issues
 technology issues
A large set of tools, techniques and software can be used to support
process analysis.

88 11/3/2011 – v2.0
Let’s have a Break

90 11/3/2011 – v2.0
3.
Define
Measures
2.
Map
Process
1.
Define
Process
A Method to Achieve
Step 6:
IMPROVE PROCESS

91 11/3/2011 – v2.0
The purpose of this module is to:
 Make you aware of the issues associated with change
 Provide you with a simple method for planning and
implementing the improvements
 Give you guidance on how to deal with problems
 Introduce the change sheet tool

92 11/3/2011 – v2.0
Change Management
 Improving processes is very likely to affect the way people
work by
 changing the process flow
 eliminating non-value-adding activities
 People tend to resist change because of the fear of
 unclear future
 having to learn new things
 Therefore, it is important to plan for change.

93 11/3/2011 – v2.0
Group Work #6: Change Management
15 Minutes
The Task:
 consider a major change that has
happened to you
 how did this change feel to you?
 the positive and the negative reactions to
the change

94 11/3/2011 – v2.0
The Cycle of Change
Outward looking
Inward looking
Future
opportunities
Past
problems
Denial
Resistance Exploration
Commitment
People in the denial
stage are trying to
avoid dealing with the
fear and uncertainty of
prospective change.
They are hoping they
won't have to adapt.
When people can no
longer deny that
something is or has
happened, they tend to
move into a state of
anger, accompanied by
covert and/or over
resistance.
This is the stage where people
have stopped denying, and
while they may be somewhat
angry, the anger has moved out
of the spotlight. They have a
better understanding of the
meaning of the change and are
more willing to explore further,
and to accept the change.
This is the payoff stage,
where people commit to
the change, and are
willing to work towards
making it succeed. They
know it is a reality, and at
this point people have
adapted sufficiently to
make it work.

95 11/3/2011 – v2.0
KEEP IN MIND THAT …
The only person who likes change is a WET BABY.

96 11/3/2011 – v2.0
The Change Sheet
•PLAN
•DO
•CHECK
•ACT
•REVIEW
A tool to help teams plan and implement the selected improvements

97 11/3/2011 – v2.0
Areas of Planning
 Remember that every improvement has potential impact in
three main areas:
 the process itself
 the people related to the process and the improvement
 The technology which supports the process
 Plan for the impact in these areas and create implementation
plans for these too.

98 11/3/2011 – v2.0
Planning for Improvement
Section 1 THE REQUIRED CHANGE
 Single change objective
 Why the change?
 Expected benefits
 Key policies
Section 2 THE FUTURE SCENE
 ‘Look and feel’ when successfully implemented
1 - 4

99 11/3/2011 – v2.0
Planning for Improvement
Section 3 PEOPLE AFFECTED
 Who are they?
 What’s in it for them?
 Expected reaction to the change
Section 4 ENABLING THE CHANGE
 Who is in the change team
 Their roles
 Their responsibilities
 Impact on other systems and processes
 Other resources required
1 - 4

100 11/3/2011 – v2.0
Plan
Section 5 PLANNING THE CHANGE
THE PLAN
 Tasks and deliverables
 Responsibilities
 Outline timescales
RISKS related to …
 Time
 Cost
 Quality
 Process
 People
5

101 11/3/2011 – v2.0
Do
Section 6 AWARENESS AND TESTING
Implementing the process improvements for
pilot and testing
 Gain user commitment
 Determine the measures of success
 Pilot and test
6

102 11/3/2011 – v2.0
Check
Section 7 THE RESULTS OF THE CHANGE
 Did the awareness and testing come out as
planned?
 Check the results against measures of success
 Revisit previous sections in the change sheet
 New actions?
7

103 11/3/2011 – v2.0
Act
Section 8 MODIFY THE PLAN AND COMPLETE
THE CHANGE
 How are you measuring and reviewing progress
in the implementation of improvements?
 How do you deal with problems and changes?
 How are you training people?
 Any new actions?
8

104 11/3/2011 – v2.0
Review
Section 9 THE IMPACT OF THE CHANGE
 Was the implementation of improvements
successful and effective?
 Were the benefits gained?
 What lessons did you learn?
 What recommendations would you make for
future improvement projects?
9

105 11/3/2011 – v2.0
Dealing with Problems
The Ten Point Recovery Plan (1/2)
 Require Compliance
 Requiring from people what they agreed to do and pointing out the impact their
lack of delivery will have on others
 Recover
 Re-examine budgets and schedules to see if savings can be made later in the
project
 Narrow Scope
 Eliminate non-essential elements (the ‘wants’?)
 Deploy More Resources
 Increase the number of people/machines etc.. Need to balance the increased cost
against the importance of the deadline
 Accept Substitution
 If something is not available or too expensive. Need to balance against other
project requirements

106 11/3/2011 – v2.0
Dealing with Problems
The Ten Point Recovery Plan (2/2)
 Seek Alternative Sources
 When a supplier cannot deliver within budget, schedule and quality
specifications
 Accept Partial Delivery
 If the full amount can be delivered at a later stage
 Offer Incentives
 For meeting time, cost and quality requirements if the going gets tough
 Escalate
 Put a case to senior management if the blockages become too severe
 Renegotiate/change the project requirements
 Discuss with the client the possibility of increasing the budget, extending the
deadline or relaxing some other requirement

107 11/3/2011 – v2.0
Stakeholder Analysis Matrix
How Do You Make a Stakeholder Analysis
Matrix?
Step 1: Begin by making a list of anyone whom
has interest or influence over the activity, project
or initiative.
Step 2: Draw a box divided into four equal
quadrants. Make sure you create this box large
enough to fit in the various stakeholders when it
is the appropriate time. Divide each quadrant
into fourths again. You should now have sixteen
quadrants.
Step 3: Label down the left side starting at the top with “Significant Importance,” “Some Importance,” “Little
Importance,” “No Importance.”
Step 4: Label across the top starting at the left with “Significant influence,” “Some influence,” “little influence,”
“No influence.”
Step 5: Begin to organize your stakeholders according to importance and influence.
Step 6: When you are done with step 5, your matrix will be a graphic display of who holds the most
importance and influence (the group in the upper left-hand corner) and who holds the least amount of
influence and importance (the group in the lower right-hand corner). Those in the high importance/influence
category will be the first ones to consult since they carry a heavy weight in the direction of the project.

108 11/3/2011 – v2.0
Force Field Analysis
 Step 1: Define your current situation.
 Step 2: Define where you want to be, what you want to achieve and/or
what the situation would be like if there was not the problem you are trying
to solve.
 Step 3: Identify the forces -[either helping - (positive) or hindering -
(negative)] you see on your way from the current situation to the future
state.
 Record only existing forces, not planned
 Step 4: Identify the relative strength of the helping and the hindering forces.
 Step 5: Identify your action areas to help you use the forces around you.

109 11/3/2011 – v2.0
Example to Force Field Analysis
Current Situation
Production Culture
Future Situation
Customer Culture
Helping Forces Hindering Forces
Competitors actions
Customer Demands
Marketing skills
Advertising Agencies
History of the company
Management Incentives
Budget process

110 11/3/2011 – v2.0
Action Planning
 Divide solution(s) into actions.
 Assign responsibilities.
 Create a schedule.
Measure: Time
Quality
Cost
Time (25% improvement)
Quality (50% reduction
in expenses of quality
failures)
Cost (20%
productivity
improvement)
WHO?
WHEN?
WHAT?

111 11/3/2011 – v2.0
Team Identification:
Team Members:
Team Location:
Present Situation: Desired State:
Challenges/Problems:
Priorities: Problem Statement:
Objectives: Strategy/Project Action Items/Targets
Process Owner:
Date Updated:
Next Review:
Owner
Action Plan Template

112 11/3/2011 – v2.0
Improvement Objective:
Team Identification:
Team Members:
Process Owner:
Date Updated:
Next Review:
Action
Items
Item
Owner
Schedule and Milestones (Plan vs. Actual) Performance
Target ActualMMYR MMYR MMYR MMYR MMYR MMYR MMYR MMYR MMYR MMYR MMYR MMYR
Comments or observations:
Implementation Plan Template

113 11/3/2011 – v2.0
30 Minutes
The Task:
 complete the first two sections
 the required change
 the future scene
in the change sheet to plan for your process
improvement
 any concerns as to how to apply this step of the
method in practice?

114 11/3/2011 – v2.0
 Owner/sponsor commitment is particularly important at this
phase, since improving a process is likely to
 change the way the process operates
 have on impact on people’s work
 have an impact on other processes
 Make sure that the process owner/management sponsor fully
agrees to the improvement plans

115 11/3/2011 – v2.0
Improving a process has potential impact on three areas:
 the process itself
 the people working with the process
 the technology supporting the process
Therefore, it is important to
 be aware of the issues associated with change
 plan for improvements
 agree improvements with the process owner / management sponsor
A simple method - the change sheet tool - helps you to plan and
implement the improvements

116 11/3/2011 – v2.0
3.
Define
Measures
2.
Map
Process
1.
Define
Process
A Method to Achieve
Step 7:
MANAGE PROCESS

117 11/3/2011 – v2.0
The purpose of this module is to:
 To discuss how to follow up process performance
 To discuss how to relate BPI 7 business process
improvement to routine management
 To discuss how to maintain the benefits and ensure
continuous improvement by repeating the BPI 7 business
process improvement process

118 11/3/2011 – v2.0
BPI 7 and Continuous Improvement
 BPI 7 is a continuous process improvement methodology
 BPI 7 does not stop after completing the first round of the BPI 7 cycle
 To ensure that BPI 7 continues to be an effective improvement
tool, BPI 7 teams should:
 identify the points of conflict with other teams and resolve them
 identify which management teams should support the review of
process performance
 identify any other barriers to ongoing improvement

119 11/3/2011 – v2.0
BPI 7 and Routine Management
 The BPI 7 process should be integrated into routine
management in order to
 ensure follow up of process performance
 allow the process owner to fulfill his/her responsibilities in a
systematic way
 To manage process performance it needs to be clearly defined
 what is to be managed
 by whom
 at what frequency e.g. daily, weekly, monthly
 how performance data should be reported

120 11/3/2011 – v2.0
Checklist for Managing BPI 7
Ensure you have:
 Process Name
 Process Owner / Management Sponsor
 Process Performance Measures
Managed by:
 ‘XYZ Team - whose members are
 Who meet every .....
 And use the following performance data.....’

121 11/3/2011 – v2.0
The Management Team
Consider involving the following people:
 A customer(s)
 A supplier(s)
 A representative of other critical interface processes
 Somebody not involved in the process
 Process owner / management sponsor
 A facilitator (if not the process owner)
 Budget holder (may be the process owner)
 Information Systems expert
 Human Resources expert

122 11/3/2011 – v2.0
Considerations at Management Team Meetings
 What issues are there that are effecting performance of the
process?
 Is the process meeting its Time, Cost, Quality and Customer
Satisfaction targets?
 What action do we need to make sure that the process meets
its targets?
 Do we need to revise our targets?
 How are our improvement plans progressing?
 What support do we need to provide to process teams?

123 11/3/2011 – v2.0
Repeating BPI 7
 It is anticipated that the routine improvement - steps 4 to 7 - will go on
throughout the year
 BPI 7 will be repeated in full when process performance circumstances
require: for example,
 where there is a substantial change in the process
 where customer requirements change
 where supplier performance changes
 The team managing the process, led by the process owner/ management
sponsor, is responsible for taking appropriate action using BPI 7
Define
Process
Map
Process
Define
Measures
Set
Targets
Analyze
Process
Improve
Process
Manage
Process
Step 1 Step 2 Step 3 Step 4 Step 5 Step 6 Step 7

124 11/3/2011 – v2.0
20 Minutes
The Task:
 complete the Manage Process worksheet
the method in practice?

125 11/3/2011 – v2.0
BPI 7 is a continuous process improvement methodology
 it does not stop after completing the first round of the BPI 7 loop
 it needs to be repeated
 it should be integrated into routine management
The management team defines who, when and with what data to
follow up process improvement - other information comes from earlier
steps

126 11/3/2011 – v2.0
REMEMBER …
The FIRST STEP is always the HARDEST.

127 11/3/2011 – v2.0
Business Process Improvement
The End …
“Perfection is not attainable, but if we chase perfection we can catch
excellence.” - Vince Lombardi

128
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remove all logos and references to Operational Excellence
Consulting. You can share the material with your colleagues and
re-use it as you need. The main restriction is that you cannot
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Business Process Improvement (BPI 7) Process Training Module

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Business Process Improvement (BPI 7) Process Training Module