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Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Types of Continuous Improvement
Daily improvement– Incremental improvement made by those individuals that
are part of the process. – Seeks to standardize and stabilize process performance
and to implement daily controls to sustain the improvement over time.
– Involves use of basic process improvement tools.
Breakthrough improvement– Step change improvement. – Usually created by fundamental changes to the process.– Typically involves the use of advanced process
improvement tools such as Six Sigma, simulation/ modeling, new technology, etc.
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Principles ofContinuous Improvement
Value is in the eyes of the customer (receiver). All work is a process. Processes can be measured. Variation exists everywhere. Variation creates waste which leads to process
degradation. Understanding and reducing variation and waste
are key to successful improvement. Involve and empower employees.
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What is Value?
Value Added Activity Non-Value Added ActivityAn activity that changes the size, shape, fit, form, or function of material or information (for the first time) to meet customer demands and requirements.
An activity that consumes time or resources, but does not satisfy customer demands and requirements.
Value add is typically ≤ 5% Non-value add is typically ≥ 95%
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Overview of Organizational Change
Models
What is Change? According to the dictionary, change is:
– The act, process, or result of altering or modifying.– The replacing of one thing for another.– A transformation or transition from one state, condition or
phase to another.– Something different; variety.
Synonyms for change include:– Alteration– Modification– Transformation– Adjustment– Variation
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Kotter: Why Organizational Change Fails
Allow Too Much Complacency Fail to Create a Sufficiently Powerful Guiding
Coalition Underestimate the Power of Vision Under Communicate the Vision Permit Obstacles to Block the Vision Fail to Create Short-Term Wins Declare Victory Too Soon Neglect to Anchor Changes Firmly in Organization
Culture
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From: John P. Kotter. Leading Change. Boston, MA: Harvard Business School Press, 1996.
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Kotter’s Eight-Stage Change Process
1. Establish a Sense of Urgency2. Create the Guiding Coalition3. Develop a Vision and Strategy4. Communicate the Change Vision5. Empower Broad-Based Action6. Generate Short-Term Wins7. Consolidate Gains and Produce More Change8. Anchor New Approaches in the Culture
From: John P. Kotter. Leading Change. Boston, MA: Harvard Business School Press, 1996.
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Role of Leaders in Managing Change
Create a climate where truth is heard*– Lead with questions, not answers.– Engage in dialog and debate, not coercion.– Conduct autopsies, without blame.– Build red flag mechanisms that turn information into
information that cannot be ignored.
* Jim Collins. Good to Great. New York: Harper Collins, 2001.
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Strategic Focus Tools
Shared Vision, Mission & Core Values Voice of the Customer Key Measures Prioritization Matrix Improvement Project Charter
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Mission, Vision & Core Values
Mission: Statement of purpose– Essence of organization; does not change over time.
Core Values: Principles of the organization– Guide behavior and decisions in pursuit of the Mission
and Vision.
Vision: Description of the desired future state of the organization– Clarifies direction for change.– Gap with Current State provides motivation to take
action.
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Relationship Current State, Mission, Vision and Core Values
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
VOC Data Collection
Customer What & Why Reactive Sources
ProactiveSources Summary
Who is your customer –
internal and/or external?
What do you want to ask them and what information do you need to probe for?
Why are you asking these questions –what information are you expecting to gain?
What reactive actions will you take to gain the information –customer complaint data, monthly scorecard information, customer feedback, etc.
What proactive actions will you take to gain the information –surveys, interviews, customer focus groups, meetings, etc.
What information did you gain from the probing? What does the customer need from your process?
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Proactive: Customer Interview Important information gathering technique to
understand voice of customer. Fosters cooperative working relationship with
customer. Ask open-ended questions such as:
– “Tell us about your job …”– “What barriers do you face in doing your job …?”– “What issues do you encounter when …?”– “Tell me more about …” – “Give me an example of ….”– Use what, how, when or why words
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Proactive: Customer Survey Measure of what a person knows, likes and dislikes,
and/or thinks about your product and/or service. Must be well designed.
– Identify needs and goals of survey.– Define participants.– Determine format and administration of survey.– Generate survey questions.
• Keep short, simple and relevant• Keep clean• Provide instructions
– Test/pilot with several participants.– Determine how survey results will be analyzed before
administration.50
Proactive: Focus Group A small group of people are asked about their
perceptions, opinions, beliefs and attitudes towards a product and/or service.
Questions are asked in an interactive group setting where participants are free to talk with other group members.
Useful when desired information about behaviors and motivations is more complex than a survey is likely to reveal and when the dynamic interchange between the group members may result in more in-depth and unbiased information than one-on-one interviews.
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Procedure for Creating CTQ Tree
Identify customer needs. For each need, determine what fulfilling that
need would mean to the customer. This is a “driver.”
Keep asking the same question – “what would that mean” – until you reach a level where a clear and measurable specification can be written.– Example: “timely and accurate” means “quick
delivery”; “quick delivery” means receipt the next day.
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Key Measures High-level indicators of the success of the organization. Often reflect:
– Customer requirements– Financial expectations– Targets for each product/service family and market– Expectations for each competitive advantage to be established
or enhanced
Should be:– Derived from strategic objectives. – Defined and measurable.– Clear to all who have to understand and be guided by them.– Balanced between financial, customer, internal process, and
learning & growth.
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SMART Measures
Specific – identified with a relevant strategic objective, strategy or process.
Measurable – mechanisms exist or can be developed to quantify the metric.
Action-oriented – provide insight into action required.
Relevant – to the critical processes of the organization.
Timely – available at the right moment for decision making.
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Operational Definition
A clear, precise description of what is being measured.
Used to remove ambiguity in measurement and improve data integrity – no matter who does the measuring, the results are the same.– Example: One person may say an invoice is paid
when the request to pay is submitted to the accounting system, while another person may say it is paid when the check is cut, while yet another person may say it is paid when the check is cashed.
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Operational Definition ExampleTitle Average monthly invoice cycle time
Purpose Is the average time to pay invoices meeting target?
Description Invoice Cycle Time is the amount of time between when the billing information is received from a CSR as measured using the time stamp on the file to the time the invoice is sent to the customer as measured by the time stamp on the electronic customer notification.
Source of Data Invoice tracking report
Calculation (Time invoice sent to customer) – (Time billing information received from CSR)
Timeframe Calculated for all invoices processed in a given month (28 days)
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Identifying Key Measures Identify critical dimension(s) associated with each
strategic objective, strategy or process: Quality, Timeliness, Cost, Quantity
Brainstorm potential key measures for each critical dimension.
Evaluate each brainstormed potential key measure:– Does the measure assess performance of the strategic objective,
strategy or process?– Can your organization influence the outcome of the measure?– Can you establish a challenging goal for the measure?– Will the measure result in a number that can be analyzed?– Can you obtain an accurate and precise measurement?– Is it cost effective to track and report?
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Prioritization Matrix
Narrows options (change/improvement opportunities) by comparing and weighing choices against a set of criteria.
Identifies the option that best meets multiple criteria.
Rating of Importance
10 8 9 4 6
Impa
ct o
n C
usto
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ent
Pro
babi
lity
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Suc
cess
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Im
plem
ent
Total
Option
1 Option A 3 9 3 1 3 1512 Option B 9 3 9 3 1 2133 Option C 3 1 1 1 3 694 Option D 3 3 1 1 9 121
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Charter Opportunities A charter is a one-page document that defines in
clear, specific terms the task an individual or team is to accomplish.
Includes:– Process and process owner (senior leader who has
responsibility for the process and its results)– Opportunity statement– What’s in/out of scope– Objectives (metrics, baseline, goal, entitlement)– Milestone dates– Team members
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Opportunity Statement Factual statement of situation including a
description of what key measure is involved and current level of performance. – Does not assign blame.– Does not assume cause(s) or include solution(s).
Example:– Accounts Payable processes over 150,000 invoices per
year; of those, 35% are being paid out after the contracted 60 day terms. Overdue payments to our enterprise partners are the number one reason for ship and credit holds, resulting in a loss of $2 Million of revenue and on-time performance.
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Kidney Transplant Flow Chart
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Based on: Matthew Franchetti & Kyle Bedal. “Perfect Match,” Six Sigma Forum Magazine, August 2009.
Cross Functional Flow Chart
Rearranges flow chart process steps into rows or “swim lanes”.– Rows represent individuals, roles or functions. – Steps fall in appropriate row.– Also known as swim lane flow chart.
Clearly shows hand-offs between individuals and/or functions.
Helps employees “see” opportunities for variation and waste needing change/ improvement.
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Variation and Customer Satisfaction
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Histogram and Requirements The addition of specifications or requirements to the
histogram allows one to see how the process performance compares to the requirements but tell nothing about when out of specification observations occurred. Target
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Key Tools for Communicating Change
Communication is key throughout all change and improvement efforts.
Key tools for communication include:– Stakeholder Analysis– Communication Plan– Visual Communication
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Stakeholder Analysis A stakeholder is anyone who will be affected by a
project or change in the process.– Stakeholders may include suppliers, customers,
employees, management, other departments, competitors, etc.
Stakeholder analysis identifies all the key stakeholders who will be affected, their current level of commitment and their desired level of commitment and actions to move them from current level to desired level.– Communication plan– Relationship to / member of team
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Stakeholder Analysis Matrix
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Stakeholders Current Commitment
Desired Commitment
Project Impact
Level of Influence
Key Concerns/ Needs/Issues
Action Steps (To move from Current
to Desired Commitment level?)
Relationship Owner
Include all levels that will
be affected and list out
specific names of key leadership/
management
Awareness= Has heard of the effort but hasn’t been affected yet Understanding= Know how will be affected by the effort and has started to tell other people Buy-in= Believe the new way of doing things will work for customers, company and self Ownership= Convinced this is the right way to go and trying to get others on the bandwagon
High= Significant change… Medium= Some change… Low=Minor change… to processes, roles & responsibilities or behavior/ skills
High=If this person/group supports this effort, everyone else will get on board Medium=If this person/group supports this effort, some others will be more likely to get on board Low=If this person/group supports this effort, it won’t
Identify the key issues of this stakeholder
that need to be addressed to move
from current to desired level of
commitment
List any key ideas to feed into key messages for
communication plan
Team member names who
will stay connected with
stakeholder
Levels of Commitment
“I feel personally accountable for the success of the effort, and I will lead the charge! ”
Complexity(depth of
information,interactivity,
etc.)
Time
Awareness
Understanding
Buy-in
Ownership
I have heard about the effort”
“I understand the business case and direction of the effort, and I will not stand in the way.”
“I agree with the business case and direction of the effort, and will participate moving forward.”
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Building a Communication PlanAnswer the following questions: Who do you need to communicate with? What are their main concerns/needs? What is their current knowledge, commitment? What is the best medium?
– Newsletter, email, voicemail– Town hall or all hands, small groups– Memo/letter, video, intranet/internet– One-on-ones– Visual displays, visual controls
How often should they be communicated with?143
Visual Communication
Techniques that help us understand and make visible what’s happening in our workplace so that we can act on fact to achieve better results.
When anyone can walk into a workplace and visually understand the current situation.
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Key Action Planning Tools
Once the need for change/improvement is “seen” and understood, action planning is required to identify the tasks, responsibilities and timing for the change/improvement.
Two useful action planning tools are:– Action Register– RACI
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Action Register Identifies actions to be taken, who is responsible
for each action, and timing. Reviewed at beginning and end of each
change/improvement team meeting.– Celebrate completed actions and capture lessons
learned.– Identify assistance needed to complete overdue
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Action Register Example
155
Process: Order Entry
Date: 3/3/2005Project Began: 2/14/2005 Indicator
Champion: Mike Smith Green
Team Leader: Greg Thompson Yellow
Team Members:Mark Long, Cheryl Martin, Ken Short, Chris Bower
Red
Coach: Sarah Cohen
Date Who When Status2/14/2005 Greg 2/21/2005 Complete2/14/2005 Greg 2/21/2005 Complete2/14/2005 Cheryl 2/16/2005 Complete2/14/2005 Ken 2/17/2005 Complete2/28/2005 Mark 4/1/2005 In-process
Set up Team Meeting ScheduleSet up Department Reviews with SponsorObtain training for CSRs on electronic credit checksProvide CSRs access to electronic credit checksDefine look-up structure
Status
Task In-Process or Needs Follow-up
Alert! Task Behind Schedule
Task Complete
Action Register
What
RACI
Defines who is Responsible, Accountable, Consulted, and Informed for each task.
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R- Responsible-Individual(s) who perform a task; the doer; responsible for action/ implementation (may be shared)A - Accountable- Individual who is ultimately accountable, includes yes/no power of veto (only one person can be accountable)C - Consulted-Individual(s) to be consulted prior to a final decision or action (two way communication)I- Informed-Individual(s) who need to be informed after a decision or action taken (one-way communication)
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Adm
in
AB
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Spe
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Mee
ting
Serv
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Man
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Mee
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& M
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# Task / Activity TimingConduct PEV Training for New PEVs
1 Serve as Lead Facilitator for PEV Training Mar-June A,R2 Serve as Lead Facilitator Coach / Mentor Mar-June A,R3 Register PEVCs for training Jan-May A
4 Request nominations for Training Mentors from Societies Dec-Jan A R
5 Nominate Training Mentors Dec-Jan C I6 Authorize PEV Training Mentors Dec-Jan A,R I7 Assign Training Mentor to PEVC Jan-May I I
8 Follow-up with PEVC re:Pre-work Mar-June C
9 Assemble/prepare PEV training materials; ship Mar-June A,C r r R
10 Support Facilitation Team (setup conf calls, team logistics) Mar-June A,R R
11 Make hotel reservations for PEVCs and Facilitators Mar-June C A,R R12 Process travel expenses for PEVCs and Facilitators Mar-June A R13 Provide back of the training room support Mar-June A,R R R r14 Provide feedback to Facilitators Mar-June A,R15 Gather feedback from Facilitators Mar-June A,R R R r
16 Assemble PEV Training metrics and other feedback Mar-June A,R R
17 Analyze PEV Training metrics and other feedback Jun-Jul A,R
18Select Facilitators (Lead and Support) for F2F training sessions
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
RACI 4-Step Process
1. Determine the tasks/activities to be performed.2. Prepare a list of individuals or roles.3. Create a matrix where tasks form the rows and
individuals/roles form the columns.4. Fill in the cells, as appropriate, with R, A, C,
and I.5. Get feedback and buy-in from all involved.
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RACI Guidelines
Place accountability and responsibility at the lowest feasible level.
There can be only one accountability per activity. Authority must accompany accountability. Minimize the number of consults and informs. All roles and responsibilities must be
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Work Instruction
164
How Much Detail?
What’s and how’s critical to achieving minimal variation and waste.– Only essential information.
Dependent on knowledge and skill-level of individuals using work instruction.– Inexperienced: Detailed step-by-step instructions.– Expert: Checklist or simple flowchart.
Dependent on frequency of use.– Infrequent: Detailed step-by-step instructions.– Frequent: Checklist or simple flowchart.
Creating Successful Change Using CI MethodsSWaMFest VII, September 15, 2011
Text Work Instruction Format
166
Step Action Detailed Actions
1 Open pricing template Click on File>>Open
Double click on file to be opened Click on Enable Macros button
2 Apply pricing rules as determined by Supply Manager
Refer to Price Maintenance document, 9.0 below, for guidelines for using the functions listed in the **pricing** menu
3 Run Error Check report Select **pricing**>> error check from the toolbar
Select Yes from dialog box that asks if you’d like to proceed
Select OK when the “error check completed” dialog box appears (if errors detected then dialog box will show number of errors and open up the error worksheet tab when OK is selected)