Leading Six Sigma

Creating Customer Value or should I say Removing Non Value

Monday, April 12th, 2010

I have seen many companies trying so hard to get their employees to work harder creating more value for their customers. Trying constantly to keep a competitive edge over the competition. And yet when they really look around their employees are working already so hard. In fact, I’d say, people are busy 99% of the time trying to do a good job. So how does a company today meet this challenge, it is in the things the people do. The process! It is not the “people” that creates the value, but the activity (process) they do that creates it. You can actually see this but looking at the “things” (paper or product) in the process evolving into customer needs. If you focus on the “things” in the process and NOT the people you will see that those “things sit there not doing a thing 99% of the time. So to increase value to your customers you need to take the time wasted by the things in the process just sitting doing nothing and remove it.

How do you do that? Simple, buy looking at the entire process. Look at things people are working on. If you see things that no one is working on then you can bet there is no value being added. Those steps/activities should be eliminated thus removing wasted time from the process. This concept is applied using what is called a Value Added Flow Analysis and I am going to quickly give you the “How To” perform one.

Value Added Flow Analysis

Capture all the steps in the entire activity/process from beginning to end.
1. To do this you follow one of those “things” (paper or product) from the receiving dock to the customers hands.
2. Record EVERTHING that happens and how long it takes. I mean everything! Including, for example, the “step” of the thing (order) sitting is a briefcase or notebook as it is transported back to the office to be entered into your system. Or the “step” of the thing (your lunch order at a restaurant) sitting on the note pad as it travels to the kitchen. EVERYTHING! This list will be long both in time and steps.
Next you will take this list and look at each of those step and determine if it is value added or not. So how do you determine if it is value added? Value added steps can be identified by answering three questions about each step. All three questions have to be answered YES! If any are answered no then they are “non value added steps” and need to be put on the list to be elimination or improvement. Here are the three questions:

Does the thing in the process change? If the “thing” is paper was some information recorded on it? If the “thing” is a product was something added to it?
Does the customer care about the change? In other word are they willing to pay for the change that happened to the thing in the process.
Was it done right the first time? Remember that you, as a customer, do not what to pay for mistake or redo’s and you surely do not want to wait for the error to be corrected. This is of no value to you.

Once you have identified all the value added step then you need to eliminate or significantly improve all of the others. In a simple world you would just eliminate all of the non-value added steps. But our world that is not so easy to do, but I do feel you can eliminate about 75% of them.

Non Value Added Step Eliminating:

How can I be so sure that you can eliminate 75% of these steps; experience. Over the years I find over and over again that you can eliminate about 75% of the non value added steps. Look at one of your processes. When you first developed this “process” it was done a certain way. If lucky that way was written down as a procedure. But as time changed so have customer needs and to meet those needs you have adjusted your process. Over time with all the “adjustments” you now have a process that has several steps that are not needed any more to meet old needs that are no longer there. Another example maybe that the “process” has been handed down from employee to employee (no documentation) and each has done it slightly different. So in time the process has shifted from a originally good one to one that is different during which time the customer needs have changed as well. In either case steps have been left that create no value for your customer and need to be eliminated.

Non Value Added Step Improvement:

OK not everything can be eliminated. Why? Because many time we have more than one customer set of values and we have to prioritize, not eliminate, what we are doing. Be careful you are not micro managing something for you own interest and NOT your customers. A good example of a non value added step that can not be eliminated is Taxes. The “Paying Customer” does not care whether you pay them or not. But to stay in business you have to. Some look at the IRS as another customer (although not a paying one). So in these cases you have to look at ways of completing those steps as quickly and correctly as possible.

Well there you have it. How to create value without something new, but by eliminating waste. That is of value to the customer in that it reduces cost without reducing quality and they receive it sooner than expected. If you like this article I have written several others on my blog http://www.sixsigmatrainingconsulting.com/knowledgebase/ . As always, if you have any questions feel free to contact me.

Bersbach Consulting
Peter Bersbach
Six Sigma Master Black Belt
http://sixsigmatrainingconsulting.com
peter@bersbach.com
1.520.829.0090

Tags: Customer Value, Method, Seven Types of Waste
Posted in Leading Six Sigma, Six Sigma Tools | No Comments »

2009 Malcolm Baldridge Award Recipients

Friday, February 5th, 2010

Created by Congress in 1987, the Baldrige National Quality Program
exists to help organizations like yours improve their performance and
succeed in the competitive global marketplace. We are the first and
only public-private partnership and Presidential award program
dedicated to improving U.S. organizations.

This Website shows the latest winner of the 2009 Malcolm Baldridge Awards.

Manufacturing – Honeywell Federal Manufacturing & Technology

Small Business – MidwayUSA

Health Care – AtlantiCare and Heartland Health

Nonprofit – VA Cooperative Studies Program Clinical Research Pharmacy Coordinating Center

Check them out and Congratulations to all !!

Bersbach Consulting

Peter Bersbach

Six Sigma Master Black Belt

http://sixsigmatrainingconsulting.com

peter@bersbach.com

1.520.829.0090

Tags: Health Care, Leadership, Six Sigma Success
Posted in Healthcare Success Stories, Leading Six Sigma, Manufacturing Success Stories, Service Industry Success Stories | 5 Comments »

Article Review – Where Process-Improvement Projects Go Wrong (WSJ)

Monday, January 25th, 2010

Today a friend sent me this article “Where Process-Improvement Projects Go Wrong” from the Wall Street Journal. The author seems to feel that most Lean Six Sigma projects fail, but has some very interesting lessons learned.

I agree with your article when it comes to how weight-loss and Six Sigma fail. They both do fail just like a spring, But I disagree with how often they fail. I have seen and read hundreds of successful projects that show Six Sigma successes[i]. I have not read them but I feel there are probably just as many in weight loss success as well. Yes some are successful in several projects before the “fad” wears off, but what really makes them fail. Both Weight Loss and Six Sigma, failure is due to a lack of commitment to a cultural change not just a few projects. I think you found that out too in your lessons learned[ii].

Lets look at your four lessons learned:

“…the extended involvement of a Six Sigma or other improvement expert is required of teams are to remain motivated.” This is very true. IF the Expert is pulled on any improvement project usually it means failure. Where you have a company that has committed to a Six Sigma cultural change, pulling the expert means closure of the project and an explanation from top management (not a lower level) of the reason it is no longer a viable or priority project. All Six Sigma project should be a high priority project.
“…performance appraisals need to be tied to successful implementation of improvement projects.” This also is true. Every project, in a company committed to a Six Sigma cultural change, has a sponsor who insures that the project is aligned to company goals and objectives that directly impact his or her departments performance. This means failure of the project is failure to meet the goals that they have committed to and YES their performance appraisals are tied to the success of those goals and the perforance of their department.
“… improvement teams should have no more than six to nine members and the timeline for launching a project should be no longer than six to eight weeks.” Since every project should be aligned to key company goals, it would mean that top management would what this project done NOW and not later. Delay would only cost the company money. If that is not the case the project should be dropped. By the way the “DEFINE[iii]” step helps insure this IF it is done right. Also in Define not only is the start decided but also the expected completion date and team membership. People, the most important resource of a company, need to be allocated to maximize their skills. In Six Sigma teams need to be small (5-10) so that the rest of the company can meet its customers demands. Even that many has a big impact on a department. So each team has to be carefully selected to represent all that will be impacted, but large enough to accomplish the task in the time allotted. This is all done in DEFINE with the “expert” and the Sponsor.
“…executives need to directly participate in improvement projects, not just “support” them.” When a company has truly committed to this cultural change and deployed Six Sigma properly you will find every project has a director-level sponsor identified, duties specified, and sufficient time committed and scheduled in advance. Here the sponsor is part of the project team. That is how important the project is to the company.

If Six Sigma is implemented right as a business cultural change in the way they address issue and problems that hold them back from achieving their goals, then everyone get the idea and a voice. It becomes an improvement method everyone is focused on, understands and likes because they have an input into the process.

Peter Bersbach

Bersbach Consulting

peter@bersbach.com

1.520.829.0090

[i] Six Sigma Forum Magazine, ASQ Six Sigma Forum Division, www.sixsigmaforum.com

Quality Progress, American Society for Quality, www.quality progress.com

Patient Safety & Quality Healthcare, Lionheart Publishing Inc., www.psqh.com/digital

Quality Digest, Quality Digest, http://www.qualitydigest.com/content/six-sigma

Quality in Healthcare, ASQ Healthcare Division, www.asq.org/qhc

The Quality Management Forum, ASQ Quality Management Division, www.asq-qm.org

[ii] Where Process-Improvement Projects Go Wrong, Wall Street Journal | Business, January 5, 2010, http://online.wsj.com/article_email/SB20001424052748703298004574457471313938130-lMyQjAyMTAwMDIwNTEyNDUyWj.html

[iii] The First step of DMAIC – Define, Peter Bersbach, Bersbach Consulting, October 27, 2009, http://www.sixsigmatrainingconsulting.com/uncategorized/the-first-step-of-dmaic-%e2%80%93-define/

Tags: Article Review, Leadership, Six Sigma Success
Posted in Introduction to Six Sigma, Leading Six Sigma, Success Stories | 1 Comment »

System Reformers of the Health Care Industry

Tuesday, December 8th, 2009

I just finished a reading an article titled “The “Third School” for Controlling Health Care Costs?”[1] and I found it very exciting to read. In it, he talks about “System Reformers” that once were focused on improving Quality and now are focused on Quality and controlling costs. I have worked in manufacturing for years and our Quality Organizations were just that focused on “Improving Quality”. In today’s world that has changed for the better with the coming of Six Sigma a process focused on improving quality and reducing costs. I believe these reformers Altman talks about are the same.

I know some people do not like the words Six Sigma and that is because what they were told was Six Sigma did not work. There maybe several definition out there but the one I know that is working is Six Sigma is a 5 step process based on facts and data focused on customer value to grow the business. Six Sigma Belts are change agents/ System Reformers trying to create value for the customer/ patient by reducing costs (which speaks to management) and improving value (Quality). Even in manufacturing Quality Improvement never got a high priority until Quality Professionals started talking money.

I agree with Altman real cost containment and control never really comes from outside the box through regulations by the “Regulators” nor from competing health care plans and informed consumers per the “Marketeers”. It has to come from inside the box through what he calls the “System Reformer”. The True Reformer/ Change agent will be focused on creating value for all stakeholders (Stockholders, Employees/ Care Givers, and Customers/ Patients). They have to create value, NOT costs, and it can be done one area/ company at a time. The big issue will be working these change across different organizations. Again, though, manufacturing did this by working with its suppliers and customers to help them apply the same to their groups.

I believe that all of the serious questions he mentions about the System Reformers success can be addressed. Will the System Reformer approach be successful? I would answer YES! At least to all that embrace its approach. The results, from these companies, will drive others to do the same. That is how Six Sigma became as successful as it has. At first many company did not embraces Six Sigma but with time and successes at their competition, many now do. And a lot of those are in the Fortune 500.

I see the System Reformer as the only true way to get cost under control.

Peter Bersbach

Six Sigma Master Black Belt

Bersbach Consulting

From Process to Profits

1.520.829.0090

[1] Drew Altman, PhD, “The “Third School” for Controlling Health Care Costs?”, The Henry J. Kaiser Family Foundation www.kff.org , Oct 29 2009, http://www.kff.org/pullingittogether/102909_altman.cfm

Tags: Cost Containment, Health Care, Leadership, Method
Posted in Healthcare Success Stories, Leading Six Sigma | 1 Comment »

Project Selection – Getting a good one!

Thursday, September 3rd, 2009

Bersbach Consulting LLC provides Six Sigma training coaching and support across Arizona, including the Tucson, Phoenix, Scottsdale, and Glendale areas. At this time we would like to thank our friends and clients for their support. If you have landed here looking for our Six Sigma training, coaching or support services in Tucson, then please follow this Six Sigma Training link.

Project selection is critical to project success. To insure you have the right project let me give you nine areas that you should think about and if any you do not have then I’d find another that has all nine as they ALL are important.

Project Sponsorship – The project needs a High Level individual that is committed to seeing this project completed. Not just interested but a real need for him/her to see success.
Benefits – You need to make sure you have well defined and measurable benefits agreed upon by you your team and your sponsor.
Available Resources – You do not have a crystal ball so at this point you will not know all the resources that you will use but you do have an idea of some of the resource that it will take. Make sure that they will be available during the project when you need them.
Scope in terms of your (the black belt) effort – Do you have the time to do the project and will it return a big enough benefit for your level of expertise. This is really asking will it take to much of your time and you will need other Black Belt help or is it something that is a “go do project” that really does not need your Six Sigma Expertise to accomplish.
Deliverables – Have the things that you need to accomplish well defined. This is not the benefits but the things you have to put in place to get the benefits. Think of this as the vision of the state you are trying to achieve.
Time to Complete defined – Usually for a Black Belt project it should take more than 3 months but less than 12. Like some else said if the project is to big, break into pieces and make your first project one piece. BUT avoid making the problem a “Job”. You have to complete hand off and move on.
Team – Do you have a true cross functional team? What I mean is do you have someone from every function that works the process you are trying to improve.
Project Charter – This is where you have the project well defined. As mentioned by other if you do not have this you will not succeed.
Approach Value – Like the Scope in terms of your effort ask yourself if this project really needs a Six Sigma approach to solve? Or can a group just go do it. Usually if the project has been suggested by someone who understands Six Sigma it will be and will need the DMAIC process to solve. But I have projects given to me to “Clean the lab”. In reality they just did not have time themselves to clean it. So hire someone to do that for less than you make and you use your talents on a project fitting them.

Well I hope that is help.

Good luck! Let me know if I can help any more.

Peter Bersbach

If your business is located anywhere in the World including the US, Tucson, Oro Valley , Oracle, Phoenix, Glendale, and Scottsdale, Marana, Green Valley Arizona or beyond and you would like to learn more about our Six Sigma training, coaching and support services please call Bersbach Consulting LLC at 1-520-829-0090 Now!

Tags: Leadership
Posted in Leading Six Sigma, Six Sigma Tools | No Comments »

Sustaining the Gains

Friday, August 14th, 2009

I saw this statement on the web today and thought I would address it’s comment about the lack of systematizing, tracking and sustaining gains.

“Many organizations use Six Sigma methodologies to identify, define and design business processes. Through their work they render processes more effective, efficient and predictable. But some let off the gas pedal when it comes to systematizing, tracking and sustaining the efficiencies gained.”

Whether you are doing Lean Six Sigma or just Six Sigma you should be still using the DMAIC 5 step process. The last step is control where you place on the new process controls to maintain the gains. I’d say that those lifting off the gas pedal are stopping after the improvements are in place. They probably are not aware of the DMAIC process and thus did not implement the controls.

So what type of contols are there that one could implement after they have made improvement to a process? Here are several listed below:

1. (THE BIGGEST) revised standard procedures. Written procedures are so important to controlling a process.

2. Run Rules – Standard procedures have the details but posted should be a one page set of what I call run rules. These are key step to remember while doing the job. This is a sheet that even the “old-timers” regularly refer to in doing their job.

3. Contingency plan – This is a needed item in the control phase of any project as NOTHING goes perfect the first time. This tells people what to do when things go “bump in the night”. If you do not have this, when things go wrong (and they will) everyone will go back to the old way. Why because they know how to solve the problem in the old way and they are not sure in the new way.

4. Visual Controls – These we deal with everyday. The start button in the computer screen is a form of visual control. The Gas Gauge in your car is a visual control. Changed process the team needs to thing of thing that visually will help people do the right thing. Just like the Orange doily under the Decaf coffee.

Mistake Proofing – is a type of visual control that only lets a person do the thing the right way. Kind of like a jigsaw puzzle the piece only goes in one way.
Go No Go Gauges – These are used a lot in manufacturing where they use them to check if something is the correct size.

5. Setup Approvals – Some times you need some on to review and approve how thing are set up. I try to avoid this one but doing controlling the process with one of the above but if this is the only way then do it.

6. Periodic Audits – Audits are always good. They let you see how things are really done. Then you can review the findings and adjust the procedure or retrain the people.

7. Binning – This is just plan sorting things into similar groups.

8. Control Charts – If all else does not seem the right way then control chart the step. There are all kinds of control charts some easy to do some hard but all work when used properly.

Tags: Leadership, Method
Posted in Leading Six Sigma | 5 Comments »

6 Sigma Projects Management Support

Friday, May 15th, 2009

This is a feature that we are implementing with each post. It is here because we provide Six Sigma training coaching and support across Arizona, including the Tucson, Phoenix, Scottsdale, and Glendale areas. At this time we would like to thank our friends and clients for their support. If you have landed here looking for our Six Sigma training, coaching or support services in Tucson, then please follow this Six Sigma Training link.

The most critical item to the success of a Six Sigma project is management support. We always check and ask for it. But is what we ask for what we really want?

SUPPORT YOU DON’T WANT

There are four types of management support that you really do not want to have. They are support by command, decreed rules, authorized overrides, and redirection of resources. With these employees tend, luckily, to use their best judgment to “adjust” the dictates to make things work. But doing that adds to the confusion and never really solves the problem. Many times it make matters worse. Plus if YOU are the one these are suppose to help, these support type have just done the opposite. Think about it when a manager commands you to do something, changes the rules, gives someone the authority to NOT follow the standard procedure, or pull resources from you for a “Pet Project”; how do you feel? Frustrated, confused, and angry NOT a good way to start a project.

SUPPORT YOU DO WANT

Lucky for us there are four OTHER ways for management to support our projects. They are cultural change, mentoring, ID informal leaders, legitimate ways around roadblocks. Of these four by far the best one is cultural change.

Support through cultural change happens when the managers uses their persuasive power to create a company culture that embraces change instead of fighting it. Where they show employees the benefits of being evolved in solving the companies issues and problems. This is empowerment to help make the change NOT “My way or the Highway”

Support through mentoring – Today’s companies are complex and sometimes confusing as to who or where to go for help in solutions to roadblocks. A mentor is a wise and trusted counselor or teacher. This should be Management ( your project sponsor). Management has the top level birdseye view of the company that allows them to guide you through that company maze identifying who can help you solve your roadblocks.

Support through Informal Leaders – Many times it is not a manager that is the expert but some individual engineer, supervisor, or lead technician that has the answers to a problem. BUT I can assure you management knows who these “informal leaders” are and can guide you to them.

Support through Legitimate ways around a roadblock – There maybe way to get issues solved through resource not known to you as the project leader. Here again management with their birds eye view of the company may know just where to find that resource. For example you may need a mechanical engineer for your project but engineering can not part with one due to work loads. Management may know a place, like a temp organization that they could hire one to do the job for this project.

So as you can see when you ask for management support think about what you will need and let them know what that is. Both you and management will be much happier with the results.

If your business is located anywhere in the World including the US, Tucson, Oro Valley , Oracle, Phoenix, Glendale, and Scottsdale, Arizona or beyond and you would like to learn more about our Six Sigma training, coaching and support services please call Bersbach Consulting at 1-520-721-2077 or SKYPE me Now!

Tags: Leadership, Resources, Six Sigma Success
Posted in Leading Six Sigma | 2 Comments »

6 Sigma Five Key Elements to Project Success

Thursday, May 14th, 2009

This is a feature that we are implementing with each post. It is here because we provide Six Sigma training coaching and support across Arizona, including the Tucson, Phoenix, Scottsdale, and Marana areas. At this time we would like to thank our friends and clients for their support. If you have landed here looking for our Six Sigma training, coaching or support services in Marana then please follow this Six Sigma Training link.

In the Six Sigma Handbook, by Thomas Pyzdek, he defines nine criterion’s on which to score a project. All nine of these criteria fall into one of the following 5 Key elements for success without which failure will most likely occur. These five element are not only important to have at the beginning of a project but you will have to continually clarify them all the way through your project to keep them up-front, supported and visible to all until completion. As such I will give you the “signs” that will show you if you are loosing the focus on any one of the five.

1. A Common Vision and aligned goals: Having a vision for a company, personal, or Six Sigma project goal or objective is one thing, making it common and everyone aligned and focused on it is another. What I mean by a vision is what will things look like when we are done? You maybe able to visualize it yourself but does everyone else “see” the same thing. Unusually not and when that happens [sign] you will see and feel confusion. The best way to solve this is to insure everyone involved takes part in creating the vision (brainstorm it) and word smith it until all can live with the end result. Then when the team is slipping bring, it back and review it.

2. A Real Need to Improve. This need can NOT be something nice to do. It has to be something we HAVE TO do to succeed. Usually if it is tied to a top level company objective that the company is having a hard time meeting it IS a “have to do” objective. If it is not at this level what [sign] you will see is very slow progress and eventually the project canceled. Why? Because team members and managers had other priorities and this project was not a high one to them. This causes those delays to happen. As I like to say this need, needs to be something that will impact the company and all see that to make this improvement, this project needs to succeed. If things slip you need to work with your sponsor and insure that priorities have not changed.

3. An Established Method to improve. Many time people are told to go fix something and sometimes that works, but when the solution is not obvious you need a method to develop and implement a workable solution. In our case Six Sigma IS that method. A five step method (process) based on facts and data focused on your customer’s value to solve the need and grow your business. What happens if you don’t have a method? [sign] you will have false starts. Put another way, have you ever been in a meeting where once again an issue comes up that was suppose to be solved last week, last month or last year? Those are fixes that were done with no method to the solution. When you see this during your project step back and look at your six sigma methodology and see if you have to refocus the team. An Example of this is trying to fix the problem from what was learned during or at the end of the Measure step. This leads to skipping analysis were we do a “Deep Dive” for the real root cause of what we see.

4. Committed Resources to do the task. The key word here is COMMITTED! Think about who has committed resources to a bacon and eggs breakfast, the chicken or the pig? It is the PIG! The chicken has given you eggs but the pig has given you his life. That is commitment! On your project a manger or supervisor may say they will support the project with their people but they have not committed the resources until they have directed (schedule) them to be on the team and have worked out how to cover for them when they are gone. Covering does not mean they have to catch up on their own time, covering means someone else picks up tasks that they were assigned. How do you know you are loosing resources? [sign] you are feeling frustrated. An occasional loss of resources is one thing but having it happen all the time means frustration and lack of commitment of resource to be successful. Like “need”, this is an issue you should work with your project sponsor and it is an issue of priorities with other functional areas or the sponsor’s area.

5. Leadership Commitment to the project. Just like ‘resources,” the key word here is commitment. If the leadership is not committed to the project you will fail to get the support to make it happen. Committed like the “Pig”. If you do not have this you and your team will feel [sign] disappointment. This one element really leads back to the other four. With out your leadership’s commitment to the project, you will not get committed resources and you need to re-evaluate the projects Vision and need. Obviously Leadership does not see the need to do this and it must not be aligned to their goals and objectives or they do not see the same results (vision) coming from the project. Work with your sponsor to clear up these before you set forward.

If you have a good common vision that is aligned to strategic company goals and a real need by the company to meet those goals, then you can apply the six sigma methodology with committed resources and leadership to have a very successful project that will impact the company’s bottom line.

If your business is located anywhere in the World including the US, Tucson, Oro Valley , Oracle, Phoenix, Marana, and Scottsdale, Arizona or beyond and you would like to learn more about our Six Sigma training, coaching and support services please call Bersbach Consulting at 1-520-721-2077 or SKYPE me Now!

Tags: Leadership, Method, Need, Resources, Vision
Posted in Leading Six Sigma | 2 Comments »