Define PhaseDefine Phase

Jimmie CarrJimmie Carr

OPERMGT 380OPERMGT 380

Boise State UniversityBoise State University

OverviewOverview

Define Phase definedDefine Phase definedDefine TollgatesDefine TollgatesCompanies using the Define PhaseCompanies using the Define PhaseAn exercise opportunityAn exercise opportunitySummarySummary

Define Phase DefinedDefine Phase Defined

Project charter is createdProject charter is createdVoice of the Customer (VOC)Voice of the Customer (VOC)High-Level Map of current process High-Level Map of current process

is createdis createdProject Team assembledProject Team assembled

Project Charter IncludesProject Charter Includes

The business caseThe business caseThe problem statementThe problem statementProject scopeProject scopeGoals statementGoals statementMilestonesMilestonesRoles and responsibilities of the Roles and responsibilities of the

project teamproject team

Project Charter Do’sProject Charter Do’s

Make problem statement specificMake problem statement specificFocus on observable symptomsFocus on observable symptomsUse Charter to set direction, goalsUse Charter to set direction, goalsAddress project questions earlyAddress project questions early

Project Charter Don’tsProject Charter Don’ts

Assign blame in problem statementAssign blame in problem statementSet non-obtainable goalsSet non-obtainable goalsMake the charter wordyMake the charter wordy

Business CaseBusiness Case

Given to the team by the Leadership Given to the team by the Leadership CouncilCouncil

Gives a broad definition of the issueGives a broad definition of the issueGives rationale why this project is a Gives rationale why this project is a

key business prioritykey business priorityCompelling reason to commit Compelling reason to commit

resourcesresources

Problem StatementProblem Statement

Concise statement of the problemConcise statement of the problemUnder what circumstances does Under what circumstances does

problem occurproblem occurExtent of problemExtent of problem Impact of problemImpact of problemOpportunity if problem is Opportunity if problem is

eliminatedeliminated

Problem Statement FormProblem Statement Form

Problem Statement

Expected Benefits Target Stretch

Total Savings $ $

Milestones Start Date Plan Actual

DefineMeasureAnalyzeImproveControl

Team Percent of TimeChampionTeam LeaderMaster Black BeltTeam Members Role

Project ScopeProject Scope

An important element in the An important element in the chartercharter

Sets boundaries on what’s Sets boundaries on what’s included/excludedincluded/excluded

Seek a balanceSeek a balanceViewed as a contract to avoid Viewed as a contract to avoid

scope creepscope creep

Goal StatementGoal Statement

SpecificSpecificMeasurableMeasurableAttainableAttainableRelevantRelevantTime boundTime bound

MilestonesMilestones

Indicates when and where the Indicates when and where the team should be in the processteam should be in the process

Set limits for other steps in DMAIC Set limits for other steps in DMAIC processprocess

Voice of the Customer Voice of the Customer (VOC)(VOC)

Recipient of product/service Recipient of product/service targeted for improvementtargeted for improvement

Delivery timeDelivery timeAccuracyAccuracy

High-Level Process MapHigh-Level Process Map

Name the processName the processEstablish start and stop pointsEstablish start and stop pointsDetermine the outputDetermine the outputDetermine the customersDetermine the customersDetermine the supplierDetermine the supplierDetermine the inputDetermine the inputAgree on five to seven high level stepsAgree on five to seven high level steps

Symbols Used to Create A Symbols Used to Create A Process MapProcess Map

Start/stop of a Process Start/stop of a Process Decision point Decision point Step in the Process Step in the Process Direction in the Process Direction in the Process

Project TeamProject Team

Champion (process owner)Champion (process owner)

-strategically guides team -strategically guides team

-assist in picking the team-assist in picking the teamTeam Leader-Black BeltTeam Leader-Black BeltTeam MembersTeam MembersMaster Black BeltMaster Black Belt

TollgatesTollgates

Steps of the Define PhaseSteps of the Define PhaseSimilar to being on a turnpikeSimilar to being on a turnpikeStop to pay tollStop to pay tollProceed to the next tollgateProceed to the next tollgateContinue on the highway of qualityContinue on the highway of quality Improve sigma performanceImprove sigma performance

General Electric (GE)General Electric (GE)

2000 was a record breaking year2000 was a record breaking yearRevenue rose 16% to $129.9 Revenue rose 16% to $129.9

billion-a recordbillion-a record75% of GE’s top businesses posted 75% of GE’s top businesses posted

double-digit earning increasesdouble-digit earning increasesSix Sigma turned the company’s Six Sigma turned the company’s

focus from inside to outsidefocus from inside to outside

ITTITT

Uses Value Based Six Sigma (VBSS)Uses Value Based Six Sigma (VBSS)2001-$135 million in cost savings2001-$135 million in cost savingsLinked VBSS to the company’s Linked VBSS to the company’s

strategic planstrategic planGo for quick winsGo for quick winsMatch project and resourcesMatch project and resources

Define Phase Do’sDefine Phase Do’s

Give equal attention to Service and Give equal attention to Service and Output requirementsOutput requirements

Create clear goals and objectivesCreate clear goals and objectivesMeasurable requirements are Measurable requirements are

essential to understanding your essential to understanding your customerscustomers

Define Phase Don’tsDefine Phase Don’ts

Fail to measure your performance Fail to measure your performance against customer requirementsagainst customer requirements

Close your mind to new informationClose your mind to new informationMake new requirements your Make new requirements your

standard operating procedures standard operating procedures (SOP)(SOP)

Training ExerciseTraining Exercise

Break down into 3-5 people per group to Break down into 3-5 people per group to determine there are issues within your determine there are issues within your organization that you could use the Define Phase organization that you could use the Define Phase on.on.

How long did the problem exist?How long did the problem exist? How did the problem begin?How did the problem begin? Will we need a project team to work on the Will we need a project team to work on the

problem?problem? What will be the savings if a solution is found?What will be the savings if a solution is found? What will be the damage if a solution isn’t found?What will be the damage if a solution isn’t found?

SummarySummary

Define Phase is structuredDefine Phase is structuredEfficient and effective way of Efficient and effective way of

achieving a difficult undertakingachieving a difficult undertakingHigher consistency of outcomesHigher consistency of outcomesProject results as soundProject results as sound

Applying the ChangeApplying the Change

The most general lesson to be learned from the The most general lesson to be learned from the more successful cases is that the change process more successful cases is that the change process goes through a series of phases that, in total, goes through a series of phases that, in total, usually require a considerable length of time. usually require a considerable length of time. Skipping steps creates only the illusion of speed Skipping steps creates only the illusion of speed and never produces a satisfying result. …But just and never produces a satisfying result. …But just as a relatively simple vision is needed to guide as a relatively simple vision is needed to guide people through a major change, so a vision of people through a major change, so a vision of the change process can reduce the error rate. the change process can reduce the error rate. And fewer errors can spell the difference And fewer errors can spell the difference between success and failure.between success and failure.

-------James Kotter, “Why Transformation Efforts Fail,” Harvard -------James Kotter, “Why Transformation Efforts Fail,” Harvard Business Review, March-April, 1995Business Review, March-April, 1995

BibliographyBibliography Pande, Peter S., Neuman, Robert P., and Cavanagh, Roland R. Pande, Peter S., Neuman, Robert P., and Cavanagh, Roland R. The The

Six Six

Sigma Way, Team FieldbookSigma Way, Team Fieldbook, 2002., 2002.

Pande, Peter S., Neuman, Robert P., and Cavanagh, Roland R. Pande, Peter S., Neuman, Robert P., and Cavanagh, Roland R. The The SixSix

Sigma Way, Sigma Way, 2000. 2000.

Ehrlich, Betsi Harris, Ehrlich, Betsi Harris, Transactional Six Sigma and Loan Servicing; Transactional Six Sigma and Loan Servicing;

Leveraging Manufacturing Concepts to Achieve World-Class Leveraging Manufacturing Concepts to Achieve World-Class Service, Service,

1998.1998.

Eckes, George, Eckes, George, Six Sigma for EveryoneSix Sigma for Everyone, 2003, 2003

Bibliography (cont)Bibliography (cont)

Welch, John, Welch, John, GE Annual 2000 LetterGE Annual 2000 Letter

McClenahen, John, McClenahen, John, Industry Week,Publication 4/1/02Industry Week,Publication 4/1/02