Goals49actionsteps

Define Design Implement

49 Action Stepsto achieve 110% of your goals

Define Design Implement �

SIXSIGMAQUALTEC www.ssqi.com

49 Action Steps to Achieve 110% of Your Goal

Table of Contents

Introduction to Action Plan 1Strategic Alignment and Deployment �-4Operational Definitions 4-5Management Style 5-6Metrics 6Defect Identification and Elimination 7The Cost of Poor Quality 7Cultural Readiness for Deployment 8-9Willingness to Deploy 9Willingness to Change 10Identifying Improvement Opportunities 10-11

Define Design Implement 1


49 Action Steps to Achieve 110% of Your Goal

Introduction

Five years in development, the following stra-

tegic goal “readiness” discussion guide is the

result of actual performance improvement and

management programs developed while working

with hundreds of leading national and interna-

tional companies.

This document is NOT intended to be an all

inclusive list and should not be viewed as a

final, exact or absolute set of inquires to realize

all information needed to drive the “diagnosis

activity”. While answering these questions,

participants should be identifying or securing

evidentiary documents, communication exam-

ples, corporate publications, newsletters, the

Annual Report and any other material which can

support the answers given.

The questions are grouped into 10 general

categories, allowing for a quick summary or

feedback document to the “most senior lead-

ers”. The final analysis should be detailed by

player (serving as a Stakeholder Analysis) and

presented to team members.

The Categories

Strategic Alignment and Deployment

Operational Definitions

Management Style

Metrics – Application and Appropriate-

ness (Financial vs. Operational)

Defect Identification and Elimination

(Success vs. Defect)

The Cost of Poor Quality

Cultural Readiness for Deployment

Willingness to Deploy

Willingness to Change

Identifying Improvement Opportunities

The matrix of questions is the result of years of

application and a collaboration of the SSQI Man-

aging Partners, who would welcome the oppor-

tunity to discuwith you in more detail. Sugges-

tions for improvement are always welcome.

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.



How to Use the Mini-course

Based on our research, this Mini-Course is the

perfect tool to share with your executive stra-

tegic team. We recommend that you print out a

copy for each member and keep a version with

your responses for future reference.

Strategic Alignment, Deployment and Management

Reaching your strategic goals requires a clear

picture of your current “goal state” and the

identification of those performance gaps that

are preventing you from achieving the goal.

Your organization must know and understand its

strategic direction through effective communi-

cation. It must also assess internal and external

threats and challenges, as well as collect and

incorporate the voices of various stakeholders

of the enterprise.

Identifying the most critical items to address,

developing targets and plans for achieving

them, and dedicating the appropriate financial

resources are all facilitated by being able to

measure the right things in the right way.

In order to succeed, your organization must

understand the various constituents of the en-

terprise and how to secure and represent their

voices. Critical agenda items must be identified

and communicated throughout the organization.

1. Who are the critical stakeholders for your

enterprise? How do you identify their needs

and wants?

_________________________________________

_________________________________________

_________________________________________

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_________________________________________

2. What are the strategic goals and objectives

of the enterprise? Your organization? How were

they identified?

_________________________________________

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_________________________________________

3. How are the goals of the enterprise commu-

nicated to the organization?

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Strategic Alignment, Deployment and Management (cont.)

4. What/who is your greatest competitive

threat?

_________________________________________

_________________________________________

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_________________________________________

5. How do you measure your progress towards

those goals and objectives?

_________________________________________

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6. What plans are in place to achieve your

goals?

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7. Are plans connected to capital and operating

budget planning activities?

_________________________________________

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8. How are funds allocated to projects and

programs?

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9. In the current cycle where are you in relation

to your goal targets?

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Strategic Alignment, Deployment and Management (cont.)

10. How are you currently managing current

projects?

_________________________________________

_________________________________________

_________________________________________

_________________________________________

_________________________________________

11. How does your organization manage and

monitor projects in general?

_________________________________________

_________________________________________

_________________________________________

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12. Does the strategy of your organization reach

down the organization chart to the operational

level?

_________________________________________

_________________________________________

_________________________________________

_________________________________________

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13. Does your organization deploy business

plans? How are they measured/managed?

_________________________________________

_________________________________________

_________________________________________

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Operational Definitions

From the development of position descriptions

to the articulation of responsibility by position

or title, your organization’s culture and the at-

titude that has cascaded throughout are deter-

minants of success.

14. What is your role and responsibility as you

see it?

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Operational Definitions (cont.)

15. How does your staff see your role and re-

sponsibilities?

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16. How are roles and positions defined in your

operation? Who crafts those definitions?

_________________________________________

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Management Style

How the direction is set and driven at various

levels of the organization, as well as the way

in which cross-functional decisions are made,

will reveal how “silo-ed” your enterprise is - a

potential predictor of the difficulty in address-

ing significant business issues.

Flexibility in the face of change and the align-

ment of compensation systems with perfor-

mance improvement will clearly relate the

importance of your initiative to all.

17. Are you effective at delegation? What do you

think your staff would say? Is your manager ef-

fective at delegation?

_________________________________________

_________________________________________

_________________________________________

_________________________________________

_________________________________________

18. How flexible are you? Your staff? Your man-

ager?

_________________________________________

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19. Are performance improvement efforts tied

to performance management systems?

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Management Style (cont.)

20. How are cross functional issues addressed?

By silo or cross-functionally (collaboratively)?

How are decisions normally made?

_________________________________________

_________________________________________

_________________________________________

_________________________________________

_________________________________________

21. Where does budget accountability lie? How

many layers deep in your organization?

_________________________________________

_________________________________________

_________________________________________

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Metrics

To work toward achieving its goals, your orga-

nization must be metrics-driven. An organiza-

tion’s key performance indicators reveal a lot

about its attitude toward measurement.

Are they communicated, understood, and used

to manage?

22. Is your organization data driven? Is data

respected or rejected?

_________________________________________

_________________________________________

_________________________________________

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23. Does your organization use a Balanced

Scorecard?

_________________________________________

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24. What are the critical measures of the busi-

ness and the most pivotal functions?

_________________________________________

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Defect Identification & Elimination

How specifically and clearly can your organiza-

tion articulate its problems? Where is the focus?

Who has the responsibility? Are problems recur-

ring, or are they kept in check?

25. How do you define a defect? A problem? Do

problems return after being corrected?

_________________________________________

_________________________________________

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The Cost of Poor Quality

Is there a full appreciation for the full scope of

a defect’s impact on the organization?

26. How do you understand the cost of lost

value of operations?

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27. How are costs associated with processes and

operations measured?

_________________________________________

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28. What process is in place for approval and

tracking of funded projects? And results?

_________________________________________

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29. What are some of the areas (processes,

products or services) where your organization is

wasting money?

_________________________________________

_________________________________________

_________________________________________

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Cultural Readiness

Performance improvement initiatives can excite

and drive you to greater heights, or they can

engender resistance, even fear if approached

inappropriately.

30. Is yours a process-driven organization?

_________________________________________

_________________________________________

_________________________________________

_________________________________________

_________________________________________

31. What methods are in place today to improve

operations and service?

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32. Does your organization have union issues?

_________________________________________

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33. How does the line organization look at

changes? With fear of loss of job or as a natural

evolution?

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34. What is your organization’s tolerance for

change?

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35. How often do you hear the phrase, “we

have always done it that way?”

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Cultural Readiness (cont.)

36. What is your organization’s attitude toward

the following: change, Six Sigma, Lean, Process

Improvement...?

_________________________________________

_________________________________________

_________________________________________

_________________________________________

_________________________________________

Willingness to Deploy

By identifying goals, and measuring and man-

aging toward them, you will develop a clear

definition of success. But is there a sense of

urgency around achieving these goals?

Have you failed in the past, making the creation

of support or interest in this effort more dif-

ficult?

37. What does your organization do well? Poorly?

_________________________________________

_________________________________________

_________________________________________

_________________________________________

_________________________________________

38. Are your compensation systems connected

to performance, projects and improvements?

_________________________________________

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39. Has your organization deployed change pro-

grams before? How effective were they?

_________________________________________

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_________________________________________

40. If a previous improvement initiative failed,

what were the 3 major reasons?

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Willingness to Change

Success in achieving your goals can stem from

identifying potential roadblocks to change, as

well as parts of the organization where the

sense of commitment to improvement is the

highest.

41. Is the organization open to new ideas?

_________________________________________

_________________________________________

_________________________________________

_________________________________________

_________________________________________

42. Are you personally committed to the evolu-

tion of the enterprise? How will you show that

commitment?

_________________________________________

_________________________________________

_________________________________________

_________________________________________

Identifying Improvement Opportunities

Generating positive results will increase your

organization’s desire for improvement, thereby

improving its ability to change and drive more

improvement, and finally bettering its chances

of achieving its strategic goals.

43. What are the 3-5 top issues you face today?

How would you prioritize them? Would your

staff see them in the same order?

_________________________________________

_________________________________________

_________________________________________

_________________________________________

_________________________________________

44. What are the 3-5 issues that will face your

company in 2007/2008?

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Identifying Improvement Opportunities (cont.)

45. Which of these issues have your tried to

solve in the past and failed? Others?

_________________________________________

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46. How are cross-functional issues addressed?

By silo or collaboratively?

_________________________________________

_________________________________________

_________________________________________

_________________________________________

_________________________________________

47. Does your organization consider itself a

Learning Organization? Why? Evidence?

_________________________________________

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48. Does Training = Learning?

_________________________________________

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49. How are projects selected and targeted?

_________________________________________

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Define Design Implement

time for a Fitness

Revolution?Why the tactics of connecting

strategy to execution matter



Time for a Fitness Revolution?

Why the Tactics of Connecting Strategy to Execution Matter

While nearly every industry suffered during

the recent economic downturn, by comparison

mortgage companies enjoyed a flowing stream

of success. Yet the lending industry as a whole

is by no means optimized, and tougher times

are ahead.

“Achieving immediate strategic superiority

through acquisition has been the order of the

day,” says Dale Meder, Bank of America senior

VP of business process excellence. “But now the

industry is seeking to achieve lasting opera-

tional superiority through improved process

capability.”

If Meder sounds like a consultant, it’s because

he once was. But now he’s one of those who

very much practices what he preaches. Bank of

America, since launching operational improve-

ment efforts, has identified more than $1 billion

in business improvements as a result of applying

Six Sigma and Business Process Management in a

planned, measured and systematic way.

Here’s what is sparking Bank of America and

most other large financial institutions. The

boom of the nineties broke the seams of

“transactional capacity” for many lending and

servicing institutions that couldn’t originate,

close and service loans quickly enough to meet

customer demand.

This state of overload, and the pain of lost op-

portunity, sparked imagination. How can we

improve the cycle times of all our processes?

How can we remove bottlenecks and dead time

from our operations?

This is how we can make more money: not by

merging and acquiring more, but by doing what

we do better, in a different way. Surely we can

merge and acquire, but can we achieve systemic

operational efficiencies that reduce cycle time,

minimize errors, cut costs, increase capacity

and delight customers?

An Operational Focus

The service sector in general, and the specific

world of loan servicing, is undergoing a collec-

tive epiphany of sorts. Driven by Wall Street,

it has recognized that improvement initiatives,

such as Six Sigma and Business Process Manage-

ment, are as vital as finding the next scheme

for top-line growth.



Could it be that the analysts themselves, post-

Enron, have decided that growth in general is

not as golden as they thought? Growth can be

bought and sold – or cooked up in the books – to

an extent. Beyond this, the real path of gener-

ating value (profit) in a financial services busi-

ness lies in the ability to lower cost and time

per transaction.

The pertinent question isn’t, “How much rev-

enue can you show today?” The real question is,

“How much value did you create, for your cus-

tomer and yourself, per unit of time or cost?”

The mergers, the marketing, the growth-by-ac-

quisition mentality has in a sense overachieved

– with a little help from Greenspan and an

anemic stock market. Now it’s time to focus on

pure operational excellence.

Why to Focus on Operational Excellence:

Interest rates are expected to rise, which

will have a dampening effect on the refi-

nance market. With dropping demand and

top-line growth in this area, lenders and

servicing organizations will have much to

gain by streamlining operations, building

error-free capability and reducing costs.

Home ownership as a percentage of the

population is still on the rise, so demand

for new loans should remain strong. Efforts

to reclaim wasted time and cost in this

1.

2.

area will increase the capacity to pro-

cess more loans with the same amount of

resources.

Complexity in the financial services indus-

try will materially increase, as the lines

between banking, investing and insuring

break down. This introduces heterogeneity

into formerly homogeneous strategic and

operating environments. With more puzzle

pieces of different shapes on the table,

the task of putting them together in a way

that satisfies customers and benefits the

business is more demanding.

Figuring out how to provide more value

per customer transaction, rather than how

to acquire more transactions, leads to

market leadership. Getting your house in

order, and delivering superior transactions

and services, has as much or even more

potential for growing a business than a

pure acquisitions or merger mindset.

What does all this mean? It means delighting

the customers you have may be more impor-

tant than finding new ones, who you lose later

because you don’t bring your strategies to bear

on their real needs, today, everyday, across the

entire spectrum of what you do.

3.

4.



All of business is a relationship between a

“need” and a “do.” While sound strategy for-

mulation takes care of identifying customer and

business needs, sound operational configura-

tion takes care of “doing” in accordance with

defined and measured standards.

In other words, financial services organizations

better get busy figuring out how to become

error-free when they handle the customer’s

money, process payments, send out bills, close

a loan, collect outstanding debts, answer the

phone – when they do anything in the context

of a business relationship.

Where Strategy Meets Execution

In a healthy financial business, or loan servic-

ing company, executives commit to critical

strategies and performance targets on a one- to

three-year horizon. “Formulating strategies

beyond five years is often folly,” says Meder,

“because the basic landscape of the financial

services industry is shifting dramatically.”

Furthermore, the notion that long-term strat-

egy can hold up in a volatile market is flawed.

A mindset of flexibility, not staunch adherence

to long-term goals, is the ticket for managing

the forward-looking plans of an enterprise as

circumstances change and as new data dictate.

What’s changing is that banks can increasingly

offer the same transactions as brokerages and

insurance companies, brokerages can increas-

ingly do what banks and insurers do, insurers

can fuse themselves with a bank or a brokerage

house, and so on.

All the product lines are merging, and it is

becoming fashionable to be the do-all, end-all

solution for everyone’s banking, investment and

insurance needs. A visionary mortgage company

can see itself as a onestop- shop for portfolio

advice, checking, savings, car insurance, home-

owners insurance, health insurance, mortgages,

credit cards and debit cards.

Building the internal systems – the infrastruc-

ture – for making that vision possible is another

matter. There’s a few working parts that have

to be mashed together, some strategies to

align, some processes to merge and an intensive

amount of linkage and coordination.

Let’s bring it down to the level of a loan servic-

ing organization, which has as much imperative

as any to improve its operational capability

across a broad spectrum of functions. Servicing

organizations should be asking the same ques-

tion their larger parent companies are asking:

how can I extract more business out of my cus-

tomers and take care of them too by improving

my operations?



The mantra is to increase value to and income

from existing customers, while raising the stan-

dard of services provided. In short, we ensure

customer retention through exceptional service

with one hand, and we continue to refine our

strategic intent with the other.

The Japanese have a phrase for the idea

of strategy tied to execution. They call it

“Hoshin Kanri.” Hoshin literally means “direc-

tion needle,” as in a plan or course of action.

Kanri literally means “control reason,” as in the

mechanistic management of change.

In plain English, if you want to improve your

business, you must systematize the way you

set, deploy and execute your strategies. Hoshin

Kanri is a system for translating critical strate-

gies into critical metrics. It then deploys those

metrics throughout the hierarchy of the value

chain in a cascading, cause-and-effect way.

Strategies are broken down into corporate

goals, which are broken down into business unit

objectives, down to the lowest level of mea-

surement detail. As objectives are cascaded,

they are transformed into tactics and specific

improvement projects at the lower levels. This

is how and where defects are actually elimi-

nated and improvements are realized.

This measurement system design is now what

drives the entire organization. Performance tar-

gets are set, accountability for meeting targets

is established and everyone in the entire place

knows what they have to do: drive their process

to improve their metrics

Easier said than done. Remember the IBM com-

mercial in which the boss says something close

to this: “This is a brilliant strategic plan…but is

it executable?”

It’s always easier to make the plan than to make

the plan happen. This is where Kanri comes in:

the systematic creation and control of change.

Kanri is the way you manage and control the

processes of value creation.

This is where strategy meets execution: in the

way you do business, your “core processes.”

It’s the way you originate, the way you fulfill,

the way you close and the way you service that

matters. These are the value pipelines that flow

through and beyond the various functions and

departments, the cost and profit centers, of the

place you call “work.”

Business Process Management

Business Process Management is a tool used by

business leaders to derive clarity around how an

organization’s core processes function, inter-

relate and interact with each other. While we

all intuitively “know” how we do business, the

reality is that we don’t. Whoever you are, and

wherever you work, you may think you know

how your organization originates and closes

loans, but you have another thing coming.



Each individual in a value chain (process) has

blind spots about how the process really works.

When all the many people who work on the pro-

cess interact, their blind spots interact as well.

This is why inefficiencies happen, why rework is

done, why bottlenecks occur and why custom-

ers aren’t always delighted with what you do for

them.

No one is necessarily a good or bad employee,

manager or executive by definition. But a

company’s Business Process Management infra-

structure is good or bad by definition. Inasmuch

as certain design methods inoculate a produc-

tion line against variation (the root of all inef-

ficiency and wasted cost), a Business Process

Management system inoculates a loan servicing

organization against variation, or poor quality,

in what it does.

Business Process Management leads us directly

into facing who we are and, even more, how

we do business. It leads us into “mapping” our

processes – drawing them out on a wall or in a

piece of software. It also drives us into collect-

ing valuable data about how process inputs are

morphed into outputs through some “opera-

tional transfer function.”

Remember that Hoshin Kanri is the direction

and dashboard by which a loan servicing com-

pany can fruitfully, and scientifically, engage

in making itself better and more profitable.

The causally broken down metrics create a

dashboard of blinking lights by which the reds,

yellows and greens are all the time, on and off,

depending on how well critical processes are

meeting their objectives.

The goal is always the same: to get healthy. A

Hoshin Kanri system provides the technology

for establishing a scientific basis of procedural

health intervention. Business Process Manage-

ment is the machine used to diagnose where

the performance tumors are. Six Sigma and

the like are the instruments used by expert

surgeons when performing the improvement

operation.

Now we have the context and traction to trans-

late strategy into flawless, or at least healthy,

execution. Business Process Management is the

nexus space between the brains of the strate-

gists and the hands of the executioners. In

medical terms, Business Process Management

is the x-ray that tells the improvement surgeon

where to make the incisions.

Business Process Management connects strategy

to execution in the most organized and action-

able manner possible. It is this connection that

brings life and torque to an enterprise. The

strategy without the execution is a pipe dream;

the execution without the strategy is a ship

gone awry.

Most of us have been involved in schemes to

“improve the way we do business” at least once

in our careers and probably more than once.



How many times has your involvement, regard-

less of how high or low you were in the organi-

zation, been clearly delineated and understood?

How much ambiguity has accompanied former

attempts to improve your scope of operational

control?

Hoshin Kanri and Business Process Management

create the foundation for intelligently moving in

and out of a process battlefield with your SWAT

teams – your Six Sigma black belt or green belt

projects, your quality improvement specialists,

your process engineers.

It’s not a haywire system of training a bunch

of people and turning everyone loose on any

projects or opportunities they can find. Real

operational excellence grows up from only one

thing: taking the pie-in-asky vision of what a

business wants to be and shaping it into some-

thing actionable.

Business eventually and always comes full circle

from strategies set to actions taken, and around

again. Anything you can do to make this cycle

tighter, faster and better will yield greater con-

trol power (Kanri) in keeping the company on

course (Hoshin).

“It’s such a bold step to actually try and get

140,000 people aligned from the top of the

organization to the bottom in all the businesses

we are in,” says Bank of America’s Meder.

“When complete, it will create an impetus I

don’t think will be stopped.”

Your Strategic Partner

Six Sigma Qualtec is a premier provider of

process management and performance improve-

ment consulting, training, and technology solu-

tions that drive breakthrough growth, produc-

tivity and value for our clients.

We are unique in our ability to customize the

integration of management disciplines to meet

the industry-specific requirements of global

leaders in financial services, natural resources,

manufacturing, process and service industries.

Six Sigma Qualtec

821 Alexander Road, Suite 130

Princeton, NJ 08540 • USA

(800) 247-9871 or (609) 925-9458

[email protected] www.ssqi.com

Six Sigma Qualtec

1295 W. Washington Street, Suite 208

Tempe, AZ 85281 • USA

(800) 247-9871 or (480) 586-2600

[email protected] www.ssqi.com

Six Sigma Qualtec

P.O. Box 2959

Kenilworth

CV8 1XR

United Kingdom

+44 (0) 1926 859555

[email protected] www.ssqi.co.uk

Copyright 2007. Six Sigma Qualtec. All rights reserved.

Six Sigma Qualtec821 Alexander RoadSuite 130Princeton, NJ 08540 • USAtoll free (800) 247-9871phone (609) 925-9458fax (609) 419-9855email [email protected] www.ssqi.com

Six Sigma Qualtec1295 W. Washington StreetSuite 208Tempe, AZ 85281 • USAtoll free (800) 247-9871phone (480) 586-2600fax (480) 586-2586email [email protected] www.ssqi.com

Six Sigma QualtecP.O. Box 2959KenilworthCV8 1XRUnited Kingdomtel +44 (0) 1926 859555fax +44 (0) 8701 400023email [email protected] www.ssqi.co.uk

Goals49actionsteps

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