Process improvement plays a very vital role in organizations. Lean Six Sigma is one means for creating a deployment that is to improve the business. Through this effort there should be an upbeat task of determining, analyzing and enhancing an organization’s business processes to achieve optimization and new quality standards. Process improvement efforts should entail a systematic approach that adheres to a certain methodology, where the specific approaches to accomplish this task may differ.
When undertaking a process improvement endeavor, more efficient outcomes are expected. Process improvement may involve a sequence of actions to attain new objectives and goals, like improving performance, reducing costs and elevating profits. Such actions may follow a particular technique or methodology to increase the odds of achieving successful results.
The following five tools should be included in these process improvement execution roadmaps:
1. Process Baselining and Process Comparisons
In general, four processes can be involved when baselining and determining how a process is performing relative to other similar processes:
• Building Baseline – Create a clear business or organizational baseline. This effort would entail defining the baseline about all the business aspects. By clearly describing what is currently occurring in an organization, one can better understand where improvement efforts should focus. A 30,000-foot-level performance reporting methodology provides an excellent approach for creating a process baseline that is predictive.
• Classifying Baseline – Determine all the organizations that might be compared for performance. Different factors may enter into this decision; e.g., would it be beneficial to compare performance to a leading organization within the same industry or one that has a similar culture.
• Do Comparison – Observe how organizational baselines compare. Comparisons should be made statistically; e.g., a hypothesis of equality of means for a process-output response.
• Determine Baseline Differences – Identify the reasons for differences in performance. This understanding can help an organization make adjustments to their process so that performance improves.
Flowcharting is one of the best tools for documenting and understanding various processes in an organization. This tool allows for a detailed breakdown of processes to activities and events, as well as describing logical relationships. By using flowcharts, an organization can better understand the work efforts involved in all their undertakings.
For instance, the process of getting orders and encoding them in the computer system can be represented more clearly by using a flowchart consisting of symbols that represent every event or step in the process. These can be circles, boxes or other forms of shapes that are connected with lines to direct the order or direction of the process. A good flowchart can help in communicating and clarifying what is happening or what needs to take place in an organization.
3. Value-Stream Mapping
Value stream mapping provides a picture of work flow and information flow in an end-to-end process. One can evaluate a current state and propose a future state that reduces organizational waste; i.e., transport, inventory, motion, waiting, over production, over processing, and defects. Much can be gained by examining a value-stream map; e.g., where improvement efforts or kaizen events should focus to improve a current 30,000-foot-level baseline value-stream map’s performance metrics such as lead time.
4. Cause and Effect Analysis
Problems can often be resolved by first exploring all possible causes. A cause-and-effect analysis approach provides a structure for this assessment, which involves the consideration of six areas or causes that can contribute to a characteristic response or effect: materials, machine, method, personnel, measurement and environment.
With this approach for evaluating a problem, a solution might become immediately apparent. In other cases, the potential cause may not be so obvious; however, statistical analyses of historical data can be used to test-out various theories. This information can be used to provide insight as to what might be done to improve a 30,000-foot-level process output baseline performance.
5. Hypothesis Testing
Hypothesis testing consists of a null hypothesis and alternative hypothesis where, for example, a null hypothesis indicates equality between two process outputs and an alternative hypothesis indicates non-equality. Through a hypothesis test, a decision is made on whether to reject a null hypothesis or not reject a null hypothesis, with a risk of making an erroneous decision. Hypothesis tests can take many formats. It is important to select the most appropriate hypothesis test for each situation.
Chapters 19-28 and Figure D.5 of the book Integrated Enterprise Excellence, Volume III—Improvement Project Execution: A Management and Black Belt Guide for Going Beyond Lean Six Sigma and the Balanced Scorecard provides a roadmap for tool selection and execution details for many types of hypothesis tests.
By integrating the described five tools in an organization’s process improvement roadmap, much can be gained in a business’ process improvement endeavors.