1. What is Process Improvement About?
Our Approach Sponsor Workshop Process Excellence
Welcome to the Sponsor Workshop! Let’s review our approach.
Let’s share from each other and learn more about best practices and continuous improvement techniques.

2. Objectives Introduce a framework of Process Excellence
Review our specific improvement methodologies
Explore and answer:
What is their purpose?
How are they different?

3. What is Process? Process is everywhere…everything is a process
Process = a series of actions or steps taken in order to achieve a particular end

4. So What is Process Excellence?
Improving the way that we create and deliver value
It’s about what we do for the customers, not to them
Is it about?
Standardization?
Efficiency?
A way to save lots & lots of money?
A set of tools?

5. Why Does Process Excellence Matter?
In our industry what we provide is not the differentiator
It’s what we do and how we do it
We must understand and deliver what our customers need better than our competitors
Process Excellence can help you achieve that
Process Excellence helps you achieve that
Process Excellence is improving the way that businesses create and deliver value to customers

6. Excellence = The way we do it
How Does It Help Us?
Process Excellence isn’t just about lower operating costs, it’s about aligning our organization to achieve success
That means…
Increased Revenue
Less Complexity
Better Lives
More Time
Improved Service
And Happier Customers
Process Excellence is improving the way that we create and deliver value to customers
After all process is just another name for the work we do and excellence is the way we do it
Process = The work we do
Excellence = The way we do it

7. Process Excellence Framework
What are the methodologies we use?
How are they different?

8. Three Improvement Tracks
Goal: Rapid Improvement Events
Opportunity Identified
Immediate Action Required
Simple
Problem
Complex Problem
JDI / A3
Small Team
Just-Do-It
2-6 hours of effort
(3-4 hours of training)
Kaizen
Small Team
Concentrated Effort
3-7 days of effort
(1 week of training)
Lean Six Sigma Cross-Functional
Project Based
1-4 months of effort
(2 weeks of training)
Continuing to adjust the program to support our needs and decrease cycle time (rapid improvement)
Three problem solving methods based upon complexity
Based upon what we’re seeing, 80% of our projects are likely to be JDI/ A3 or Kaizen
Three problem solving methods based upon complexity.
Today, 80% of our projects are likely to be JDI or Kaizen.

9. DMAIC Framework – The Common Overlay
Define
Measure
Analyze
Improve
Control
JDI
Just Do It
Team of 1-3
4-6 Hours
Background / Current Situation
Outcome / Goal Identification
Root Cause & Recommendations
Countermeasures Implemented
Action Plan & Follow-ups
30 minutes
30 minutes
1-2 hours
2-3 hours
1+ hours
Kaizen
Simple Issue
Team of 3-6
3-7 Days
Current Process Map
High Level Metrics / Value Stream Map
Waste Identification & Improvement Plan
Risk Analysis & Implementation
Sustainability & Measurement
½ -1 day
½ -1 day
1 day
1 day
1+ days
Lean
Six Sigma
Complex Issue
Team of 3-6
2-4 Months
Requirements & Current Process Map
Baseline Measurement
Statistical Analysis & Solution Mapping
Pilot & Implementation
Control Plan & Measurement
1-2 weeks
2-3 weeks
1-2 weeks
2-3 weeks
1+ weeks

10. What is JDI (Just-Do-It) about ?
Foundational element of continuous improvement
A way to structure and develop improvement ideas
Standardized systematic thought process
Built on the DMAIC framework
A mindset / “way of thinking”
A communication tool to report issues and improvement suggestions to management
Used for any kind of situation in all parts of the business
Thinking drives behaviors. Behaviors drive action. Action drives results.
Opportunities exist
Problems… They “nag” us, almost everyday !! - we have to face them
And …. Analyze them
And, most importantly, Solve them - Drive Process Excellence throughout the organization!
(There is indeed ‘Gain’ from their demise)

11. A Systematic Thought Process

12. Template helps with Problem Solving
The one-page template on A3 sized paper is meant to identify and communicate the critical project information and to facilitate decision-making.
This information should fit on one page, makes it easy to communicate make decisions with team.
It is customized to the Team Leader and application at hand.
It can be characterized as a lean tool best suited for solving relatively short-duration improvement activities.

13. Thought Progression follows DMAIC…

14. And, addresses these High-level Questions
Title
Updated:
Project Lead:
Sponsor:
Define: Background
Improve: Countermeasures
Measure: Current Condition
Measure: Goal
Control: Effect Confirmation
Analyze: Root Cause Analysis
Benefits & Follow-up Actions
“What is the Problem”
“How Do We Fix It?”
“Where Are We?”
“Where Do We Need to Be?”
“Did We Fix It?”
“What’s Causing It?”

15. Form and Format - Example

16. What makes an A3 / JDI a Good One?
It tells a story
It contains objective facts, data
It “resolves” a situation
It engages and aligns the organization!
A good JDI is a reflection of the dialogue that created it

17. A Way of Managing/Thinking
How does this fit into what you do everyday?
Solving Problems (Progress is essential)
Ask others about their “improvement” efforts
Proposing improvements
Standardizing
Planning / Reporting
Reflection / post-mortem
Project Management
Change Management
Alignment / Agreement
Mentoring, coaching, developing people
Key Point!

18. What is Lean Thinking about?
Built from Henry Ford (circa 1900) - Lean concepts came from the Toyota Production System, translated through teachings of Ohno and Shingo (1955 – 1985)
The goal of Lean Thinking is to:
Eliminate waste (muda) such that you are only doing value added work
Value added is defined as:
Customer recognizes the value (willing to pay for it)
Changes the product in a desired manner
Processes that are done right the first time

19. Identify and Eliminate Waste
8 common categories of waste: (Kaizen focus)
Defects - incorrect data entry, inspection
Over production - preparing extra reports, reports not acted upon, multiple copies in data storage
Waiting - processing monthly not as the work comes in (i. e. closings, billings, collections)
Non-utilized resources – not tapping into/ utilizing multi-skillsets
Transportation - extra steps in the process, distance traveled
Inventory - transactions not processed, M&R parts, UTR’s queued
Motion - extra steps, travel from office to office / desk to desk, extra data entry...
Excess Processing - multiple Billing sign-offs, inspection

20. The longer waste occurs, the more accepting you’ll become!
Examples of Waste
Layout (distance)
Insufficient maintenance
Poor work methods
Lack of training
Poor supervisory skills
Ineffective scheduling
Incorrect final point of rest
Counting inventory
Multiple Signoffs
No back-up/cross-training
Excessive UTR’s
No visual control
Lack of workplace organization
Too many outside trucks in the yard
The longer waste occurs, the more accepting you’ll become!

21. When to utilize Kaizen approach?
A Kaizen event (lean effort) is typically employed when obvious waste sources have been identified and/or when results are needed immediately
A Kaizen facilitator assembles a cross-functional team working in the process.
Additional members may include subject matter experts (SME) aimed at improving a process or problem identified within a specific area.
Project completion should be in a focused and compressed time period (typically 3-7 days of effort spread over a couple months)

22. Lean + Six Sigma Work Together
Along with the Kaizen (waste reduction) process, the concept of ‘Six Sigma’ is another structured team approach for improving process performance
Many times, they go together on a project
L6S methods (i.e. – Leanbelt; Greenbelt/ Blackbelt) emphasizes the importance of identifying key critical inputs that effect your key outputs (performance of quality) through statistical analysis
Six Sigma drives for perfection in those processes by reducing variation and/or moving the mean

23. What is Six Sigma about? Sigma is a letter in the Greek Alphabet
Sigma is a symbol which shows the degree of variation in a process (calculated as standard deviation)
The goal of a Six Sigma capable process is to:
Minimize variation
Center the process
The degree of acceptable variation in a process depends on knowing the target.
How close are you to meeting your target?
Do you know where your target is?

24. Identify and Eliminate Variation
2 common categories of Variation (Greenbelt focus)
Common cause
Is present in every process
Is produced by the process itself (the way we do business)
Special cause
Unpredictable
Caused by unique disturbances or a series of them

25. Examples of Variation (Cost of Poor Quality)
Prevention Costs
Education and training
Safety
Controlling processes
Appraisal Costs
Incoming inspection
Maintenance and calibration of equipment
Process audits
Failure Costs (Internal)
Incorrect gate transactions
Wrong boxes out gate
Rework
Re-inspection
Late Start Times
Digging for Containers
Failure Costs (External)
Processing customer inquiries
Incurring penalties/claims
Lost sales
PAF categories Typical Cost / Occurrence
Prevention $ $1.00
Appraisal $ $10.00
Failure
Internal $ $100.00
External $ $1,
Find a friend in finance. What are acceptable cost metrics to your local controller. Here are some of the possible cost opportunity categories that may be associated with your projects at Ports America.
How many of these cost categories are currently captured at Ports America?
Occurrences may be tracked for most of these categories, but costs related to the occurrences may not be captured
Most organizations measure the Internal and External failure costs.
Appraisal costs are also known as Hidden Factory costs.
The longer variation exists, the more accepting you’ll become!
© 2014 Ports America. All rights reserved.

26. When to utilize L6S approach (i.e. - Greenbelt)
A ‘Green belt’ (six sigma) effort is typically employed to determine sources of variation and reduce their impact
A Green belt project assembles a cross-functional team working in the process.
Additional members may include subject matter experts (SME) aimed at improving a process or problem identified within a specific area.
Project completion should be in a focused, “project managed” time period (Because of complexity - typically 10 to 40 days of effort spread over 4 to 6 months)

27. Reduce Variability for Process Performance
99% Good Quality (3.8σ) vs.
No electricity for almost seven hours per month
1 misspelled word per 30 pages in a book
11.8 million shares incorrectly traded on the NYSE everyday
3 warranty claims for every new automobile
48,000 to 96,000 deaths attributed to hospital errors each year
Cell Phone would be out-of-service (down) 54 hours a year
% Great Quality (6σ)
One hour without electricity every 34 years
1 misspelled word in all the books in a medium sized library
4,021 shares incorrectly traded on the NYSE everyday
1 warranty claim for every 980 new automobiles
17 to 34 deaths attributed to hospital errors each year
Cell Phone would be down less than 2 minutes a year
With just a ‘3 sigma’ process:
NO modern computer would function
10,800,000 mishandled healthcare claims each year
18,900 lost U.S. Savings Bonds every month
54,000 checks lost each night by a single large bank
4,050 invoices sent out incorrectly each month by a modest-sized telecommunications company
540,000 erroneous call detail records each day from a regional telecommunications company
270,000,000 (270 million) erroneous credit card transactions each year in the United States
© 2014 Ports America. All rights reserved.

28. Oops!

29. Why Utilize JDI, Kaizen and L6S methods?
Simple:
Common Sense
Reduction of waste
Reduction of variation
Reduced operating costs
Complex:
Vision & strategic approach
Methodology that aligns improvements to strategic objectives & utilizes aggressive goal-setting to drive real bottom-line financial improvement
Tools for: customer focus, continuous improvement, people involvement, operational excellence

30. All Three Approaches Follow DMAIC
JDI -> Basic problem solving tool, formalizes thought process and documents (A3) how a problem was solved, minimal toolset (about culture change)
Kaizen -> Workshop based problem solving tool, team based, little more around toolset
L6S -> Project based problem solving tool, very team based, data driven, strong toolset

31. “Getting Real Financial Results”
Our Overall Focus
Removal of waste to reduce time to execute processes
Improving performance by flawless execution
Achieving rapid breakthrough improvement
Applying advanced breakthrough tools that work
Making a positive and deep cultural change
Ultimately –
“Getting Real Financial Results”

32. Review Introduce a framework of Process Excellence
Review our specific improvement methodologies
Explore and answer:
What is their purpose?
How are they different?