Description
Economic Crisis & A Strategy
Economic Crisis and A Strategy
Don’t be blind to the need to change……..
“Iraqi Information Minister Mohammed Saeed al-Sahhaf, standing on the roof of Baghdad's Palestine Hotel, denied his city had been invaded.
Sirens could be heard as he spoke and clouds of dust blew past.”
Source: AP, April 7, 2003
4
Quality Management
•In difficult times, you must be innovative – you must improve efficiency and effectiveness. •Many have long predicted a bursting economic bubble; simply because history shows that the good times never roll forever. •Regardless of the causes, we can safely predict that we will emerge from this crisis. •The world of economics will have changed forever. •Business leaders will have been forced to adopt new processes and strategies. We might suffer through a few difficult years. •But the future is probably brighter than ever as sustainable accounting practices and business transparency becomes more prevalent.
Quality Management
•Prudent organisations use the good times to prepare for the bad.
•The companies that maintained that diligent focus are the ones best positioned to ride this wave of uncertainty. During the good times it is very easy to be successful. But the opposite is true in a downturn.
•You must do a GREAT job at a GREAT price AND you must provide GREAT service.
Definition of Insanity?
“ Doing the same thing over and over again and expecting a different result.”
Ben Franklin Politician
11
The importance of a management system
Vision and Strategy
Management System
Fundamentals
Projects Initiatives
Quality Management
Finally, engage in the above process as a dynamic, ongoing plan of service and customer experience innovation. In reality, the experts have mixed views about how long this downturn will last – so you must be prepared to continually innovate in a recessed economy for the foreseeable future.
Translating Strategy Into Results
--a systematic method to measure, analyze and improve business processes to identify critical areas that can cause breakthrough results in market penetration, organizational speed and the cost of doing business.
14
Introduction
Haul up sail fast and right to stand on course !
“Less than 10% of the formulated strategies are really implemented”
15
Traditional Financial Reporting: ? Focus only on financial indicators, not the business KPI’s ? Story of past events ? Overwhelming dataflow, limited information ? No link with the strategy
16
WE NEED TO MAKE IT
? focused on the future ? derived from the strategy ? not only a controlling system, but also a management system, incorporating all KPI’s
17
WHAT IS THE PURPOSE OF A BUSINESS ORGANISATION?
• Investors are moving towards total shareholder return on their investment in a company. • A strategy geared towards value creation is an essential part of forward-looking business. • This will enable a business to attract and retain further capital for growing businesses.
18
Operational decisions affect value
Efficient Operations ?Managing costs within threshold parameters ?Understanding the impact of cycle times on value ?Focussing the right resources on the right issues ?Balancing innovation with risk and return
Value Target
Optimal Business Mix ?Evaluating / segmenting the Value Potential of Products/ Services ?Focussing on differentiating core competencies ?Managing Fixed Assets
Optimal Capital Base ?Managing existing and planned capital needs ?Creatively taking advantage of tax rates
19
VALUE DRIVERS?
•Volume growth
•Margin growth •Optimum working capital •Reduce value destroyers •Lower cost of capital ……….
20
Quality Improvement Approaches
Pull / Kanban TPM 5S System Balanced scorecard EFQM Six Sigma Lean TOC SPC DOE Survey Plan MSA ISO 9000 QS 9000 Jidoka Poka-yoke TRIZ Value Engineering BPR
Project Portfolio
Y
y1 y2 y3 y4 y5
y11 y12 y13
y21 y22 y23
y31 y32 y33
y41 y42 y43
y51 y52 y53
• Critical business issues (VOB, VOC) • Resources
Project Identification, Assessment, and Selection
Project Assignment
Project Charter
• Project Execution
Project Execution, Validation, and Control
• Monthly 6sigma Project Reviews
Key Success Factors: Portfolio
Key Success Factors 1. Leadership: Urgency, Coalition 2. Metrics 3. Robust Portfolio (Aligned with Strategy) 4. Full-time, Talented Staff 5. Rigorous Problem Solving Toolkit
x1 x2 x3 x1 x2 x3 x1 x2 x3 x1 x2 x3 x1 x2 x3
y1 y2 y3 y4 y5
Must be Measurable
Business Ys
Y
• Business-level objective • Driven by Customer CTQ’s • One business owner
Potential lean6sigma Projects • Focused • Measurable • Vital Few • Business Owner
25
Critical to Customer and Business
• Major business drivers (profitability, growth, new products…..) • Specific business drivers (COGS, price, product x, scrap…..) • Process or product specific business requirements (flow, cycle time, error rates, cost…..)
Voice of Business
Critical Business Reqm’ts
Critical to Process (CTP)
Y
Voice of Customer
• Major Customer needs (design, cost, quality…..)
y1
Critical Customer Reqm’ts
• Specific customer needs (design goals, price, DPM….)
y11
Critical to Quality (CTQ)
• Product (or service) specific customer requirements (dimensional, delivery, DPM, packaging, cost....)
Project Selection
26
One of the deterministic Financial models
In M Euro Mfg. Cost Var. 6,867 Input Cost 5,008 Dir. Mat. Dir. Lab. Mat. OH Shop OH GOH Comm. Exp Alloc. Exp Output cost 11,875 Stores Cr. +/- in WIP Misc. Output
12,074 -242 43 2,256 852 412 567 345 564 12
.
NOPAT 3,639
Other Income 157 PBIT 5,754 Mktg. PBIT -996 OD Adj. A&M Alloc EVA 3,491 WACC 12.00% Net F. Assets Cap. Emp. 1,645 Net WC 1,180 Current Liab. 614 465 Current Assets 1,794 Tax 2,115 Sales / Serv Cost of Sales ED on Sales PRE T&C SPE NDC ODE Estab Other Exp.
56 218
31,443 30,897 231 345 34 124 345 396 20 47
Cap. Chg. 148
MMI WIP FG Cust. OS OCA Vendor Cr. Cust. Adv OCL
709 50 456 345 234 380 0 234
Balanced Score Card 2008 Organization :XYZ
Freq 1 2 2.0 67.3 0.4 0.1 65.7 90.7 7.6 17.0 16.0 6.4 3 2.2 67.9 0.3 (0.0) 83.4 89.6 7.2 9.0 24.0 6.7 Results (Month) Q1 4 2.2 61.8 0.3 (0.0) 70.2 90.2 7.2 46.0 55.0 6.6 1417 1.560 95.4 86.5 89.3 0.0 93.0 0.9 84.2 0.3 0.0 83.7 82.9 9.9 16.0 23.0 6.5 1600 1.777 95.5 86.0 89.6 0.0 92.0 5 2.4 61.3 0.4 0.4 86.2 84.7 7.1 9.0 10.0 6.8 1300 1.892 96.1 87.8 91.5 15.0 92.0 6 3.4 63.9 0.7 0.6 91.8 88.6 7.1 9.0 5.0 7.0 1300 2.238 96.3 89.0 92.0 16.0 78.0 Q2 3.4 67.2 0.7 0.6 87.0 85.2 7.3 34.0 12.0 6.9 1400 2.238 96.0 87.6 91.0 16.0 82.0 Financial 1. EBIT (M EURO), cum M 1.5 3.a Break-even point (%) (Excl Subcon) M 53.7 4. Business Renewal Cost Savings (M.Euro), cum 0.0 M 5. Purchasing Savings (M.Euro) Cum M 0.1 Customer 1. Customer Satisfaction % M 63.8 2. RLIP(%) M 90.3 3. Stacked Leadtime, 95% tile (days) M 6.9 4a. Number of PSX Cust Complaints (#) M 20.0 4b. Number of automotive Complaints (#) M 15.0 5. TPT customer Complaints, 90% tile (days) M 6.6 Process 1. Assembly Yield (PPM) M 1464 2. Cost of Non-Quality Improvement (M.Euro), Cum 0.429 M 3. SPC Assy CpK > 1.67 (%) M 95.2 4. Assy Asset Operational Utilisation (%) M 85.0 5. Test Asset Operational Utilization (%) M 89.7 Learning 1. Number of black&green belts trained #, M Cum 0.0 2.Skill Matrix Score M 89.0
1386 1400 1.060 1.563 95.3 95.7 87.3 87.2 89.3 88.9 0.0 91.0 0.0 92.0
Define and Measure
Define: Clearly State the Problem
Manage
in terms of “Defects” or “Variation” which Upset the Customer/Management
“Correct” (In-Spec.) DefectFree!
PIV PIV PIV PIV
Process
POV
CTQ
Measure: Describe the Performance of
the Process Quantitatively
Measured Units Counted Units
then, Identify Key Inputs
Analyze
Manage “Correct” (In-Spec.) PIV PIV PIV PIV DefectFree!
Process
POV
CTQ
Analytically Describe the Relationship Between
Inputs and the Output . . . to Find the Inputs with the Biggest Impact on the Output
Improve
Manage “Correct” (In-Spec.)
DefectFree!
High Low Medium High
????????
PIV PIV PIV PIV
Process
POV
CTQ
Systematically Find the Combination Which Delivers the Optimal Output
Control
Control Control Control
Manage
“Correct” (In-Spec.)
Process POV
DefectFree!
High Low Medium High
PIV PIV PIV PIV
CTQ
Lock In the Inputs to Routinely Generate
the Optimal Output!
What’s Included
Six Sigma is not all new; but is a strategic assembly of proven techniques that have been used effectively for many years
What’s new
Def’n
What’s not
• Software (Minitab) • Team structure • Roadmap • Gage Studies • Train - Apply -Review • Capability • Non-manufacturing • SPC projects • DOE • Design Projects • Voice of the Customer Which Will Customers Need, Want, or Be Willing to Pay For?
The Focus of Six Sigma
Y=
f (X)
To get results, should we focus our behavior on the Y or X ? ? Y ? X1 . . . XN ? Dependent ? Independent ? Output ? Input-Process ? Effect ? Cause ? Symptom ? Problem ? Monitor ? Control
If we are so good at X, why do we constantly test and inspect Y ?
Focus on X rather than Y, as done historically
Leadership & Knowledge Building
Six-sigma won’t succeed without leadership and you can’t lead what you do not understand
35
Fundamentals of 6 Sigma Project Selection
• Must be driven by leadership • Must be focused on opportunities that are real and important to the business • Usually based on either business financial or customer performance • Approach may be quantitative and scientific - is always logical • Involves people who are familiar with and accountable for process performance • Moves from broad and high-level to precise, narrow and specific • Ends with a Project charter
36
“There is nothing so useless as doing efficiently that which should not be
done at all.”
- Peter F. Drucker
39
CAUSAL THINKING AND LEADING INDICATORS
Y = f (X1, X2, X3, X4, …. , Xn)
40
WE’RE DIFFERENT
There is no such thing as “WE’RE DIFFERENT”.
41
PROCESS PRIORITIZATION
Processes
CTQ ‘s
PROJECTS
Leveraging for maximizing benefits.
42
For God’s Sake!
• Don’t Convert it to another Statistical exercise - An intellectual perversion! • Keep It focused to the Issue on hand. • Don’t Get bogged down to prescriptive Course content. Every day new and
simpler theories are taking birth, thus
have open mind!
Statistics is not everything
Support!different situations by specific tools
An Example
2002
Roll out
2003
Initiation
2004
Integeration1
2005
2006
Integeration2 Institutionalization
# Champion 70 # GBs 394 # BBs 34 #Projects 164 Low handing Fruit $ 3.2 billion Manufacturing only Hoshin Kanri
Mfg.&After Sales
# Champion 34 # GBs 80 #Projects 20 $ Not calculated
# Champion 70 # GBs 555 # BBs 61 # MBB 25 #Projects 329 $ 5.7 billion Hoshin Kanri Mfg.,After Sales & Engineering
# Champion 70 # GBs 706 # YBs 150 # BBs 86 # MBBs 25 #Projects 523 $ Integrated with budgeting
Balanced score Card
# Champion 85 # GBs 766 #YBs 300 # BBs 86 # MBBs 25 #Projects 594
EFQM,
Mfg. &Enablers
Customer Processes
Suppliers & whole Group Co.
Over The Years
Agerage pre-dispatch audit score for a product
120 117.445
Avg. Pre-despatch audit score
110
109.150
100
90
90.555
83.065
81.765
80 2001 2002 2003 Year 2004 2005
80.345
2006
Pre-dispatch audit score is obtained from Regulatory Body/Customer Representative audit
Pre-Dispatch Audit Scores are means to capture Customer satisfaction ratings.
• The “people side” of 6 Sigma is ignored, with focus directed exclusively or primarily on the technical aspects of the improvement Projects • Those on the “front lines” of the 6 Sigma initiative -i.e., the Black Belts and Master Black Belts -- often lack the skills necessary to build commitment to improvement Projects, communicate with stakeholders, deal with resistance, manage effective teams, and otherwise deal with the non-technical elements of 6 Sigma Projects*
Why the problems occur
High
The implications of ignoring non-technical aspects during change. 5
4
Score 4-5; world-class; 6 Sigma is in the DNA; it’s the way we work; “order of magnitude” payback
The degree to which 3 positive conditions for 6 Sigma 2 success exist in an 1 organisation
Score 3-4; cultural transformation beginning but may take longer; payback significant
Score 2-3; significant tactical results, but 6 Sigma remains just a “programme” but “normal” payback
Score 1-2; some tactical results ; 6 Sigma will probably die; we only get our costs back. Score 1 or less; change will fail; costs of training & consultancy will be lost The likely outcome
With acknowledgements to EAI
Low
0
doc_517857189.pptx
Economic Crisis & A Strategy
Economic Crisis and A Strategy
Don’t be blind to the need to change……..
“Iraqi Information Minister Mohammed Saeed al-Sahhaf, standing on the roof of Baghdad's Palestine Hotel, denied his city had been invaded.
Sirens could be heard as he spoke and clouds of dust blew past.”
Source: AP, April 7, 2003
4
Quality Management
•In difficult times, you must be innovative – you must improve efficiency and effectiveness. •Many have long predicted a bursting economic bubble; simply because history shows that the good times never roll forever. •Regardless of the causes, we can safely predict that we will emerge from this crisis. •The world of economics will have changed forever. •Business leaders will have been forced to adopt new processes and strategies. We might suffer through a few difficult years. •But the future is probably brighter than ever as sustainable accounting practices and business transparency becomes more prevalent.
Quality Management
•Prudent organisations use the good times to prepare for the bad.
•The companies that maintained that diligent focus are the ones best positioned to ride this wave of uncertainty. During the good times it is very easy to be successful. But the opposite is true in a downturn.
•You must do a GREAT job at a GREAT price AND you must provide GREAT service.
Definition of Insanity?
“ Doing the same thing over and over again and expecting a different result.”
Ben Franklin Politician
11
The importance of a management system
Vision and Strategy
Management System
Fundamentals
Projects Initiatives
Quality Management
Finally, engage in the above process as a dynamic, ongoing plan of service and customer experience innovation. In reality, the experts have mixed views about how long this downturn will last – so you must be prepared to continually innovate in a recessed economy for the foreseeable future.
Translating Strategy Into Results
--a systematic method to measure, analyze and improve business processes to identify critical areas that can cause breakthrough results in market penetration, organizational speed and the cost of doing business.
14
Introduction
Haul up sail fast and right to stand on course !
“Less than 10% of the formulated strategies are really implemented”
15
Traditional Financial Reporting: ? Focus only on financial indicators, not the business KPI’s ? Story of past events ? Overwhelming dataflow, limited information ? No link with the strategy
16
WE NEED TO MAKE IT
? focused on the future ? derived from the strategy ? not only a controlling system, but also a management system, incorporating all KPI’s
17
WHAT IS THE PURPOSE OF A BUSINESS ORGANISATION?
• Investors are moving towards total shareholder return on their investment in a company. • A strategy geared towards value creation is an essential part of forward-looking business. • This will enable a business to attract and retain further capital for growing businesses.
18
Operational decisions affect value
Efficient Operations ?Managing costs within threshold parameters ?Understanding the impact of cycle times on value ?Focussing the right resources on the right issues ?Balancing innovation with risk and return
Value Target
Optimal Business Mix ?Evaluating / segmenting the Value Potential of Products/ Services ?Focussing on differentiating core competencies ?Managing Fixed Assets
Optimal Capital Base ?Managing existing and planned capital needs ?Creatively taking advantage of tax rates
19
VALUE DRIVERS?
•Volume growth
•Margin growth •Optimum working capital •Reduce value destroyers •Lower cost of capital ……….
20
Quality Improvement Approaches
Pull / Kanban TPM 5S System Balanced scorecard EFQM Six Sigma Lean TOC SPC DOE Survey Plan MSA ISO 9000 QS 9000 Jidoka Poka-yoke TRIZ Value Engineering BPR
Project Portfolio
Y
y1 y2 y3 y4 y5
y11 y12 y13
y21 y22 y23
y31 y32 y33
y41 y42 y43
y51 y52 y53
• Critical business issues (VOB, VOC) • Resources
Project Identification, Assessment, and Selection
Project Assignment
Project Charter
• Project Execution
Project Execution, Validation, and Control
• Monthly 6sigma Project Reviews
Key Success Factors: Portfolio
Key Success Factors 1. Leadership: Urgency, Coalition 2. Metrics 3. Robust Portfolio (Aligned with Strategy) 4. Full-time, Talented Staff 5. Rigorous Problem Solving Toolkit
x1 x2 x3 x1 x2 x3 x1 x2 x3 x1 x2 x3 x1 x2 x3
y1 y2 y3 y4 y5
Must be Measurable
Business Ys
Y
• Business-level objective • Driven by Customer CTQ’s • One business owner
Potential lean6sigma Projects • Focused • Measurable • Vital Few • Business Owner
25
Critical to Customer and Business
• Major business drivers (profitability, growth, new products…..) • Specific business drivers (COGS, price, product x, scrap…..) • Process or product specific business requirements (flow, cycle time, error rates, cost…..)
Voice of Business
Critical Business Reqm’ts
Critical to Process (CTP)
Y
Voice of Customer
• Major Customer needs (design, cost, quality…..)
y1
Critical Customer Reqm’ts
• Specific customer needs (design goals, price, DPM….)
y11
Critical to Quality (CTQ)
• Product (or service) specific customer requirements (dimensional, delivery, DPM, packaging, cost....)
Project Selection
26
One of the deterministic Financial models
In M Euro Mfg. Cost Var. 6,867 Input Cost 5,008 Dir. Mat. Dir. Lab. Mat. OH Shop OH GOH Comm. Exp Alloc. Exp Output cost 11,875 Stores Cr. +/- in WIP Misc. Output
12,074 -242 43 2,256 852 412 567 345 564 12
.
NOPAT 3,639
Other Income 157 PBIT 5,754 Mktg. PBIT -996 OD Adj. A&M Alloc EVA 3,491 WACC 12.00% Net F. Assets Cap. Emp. 1,645 Net WC 1,180 Current Liab. 614 465 Current Assets 1,794 Tax 2,115 Sales / Serv Cost of Sales ED on Sales PRE T&C SPE NDC ODE Estab Other Exp.
56 218
31,443 30,897 231 345 34 124 345 396 20 47
Cap. Chg. 148
MMI WIP FG Cust. OS OCA Vendor Cr. Cust. Adv OCL
709 50 456 345 234 380 0 234
Balanced Score Card 2008 Organization :XYZ
Freq 1 2 2.0 67.3 0.4 0.1 65.7 90.7 7.6 17.0 16.0 6.4 3 2.2 67.9 0.3 (0.0) 83.4 89.6 7.2 9.0 24.0 6.7 Results (Month) Q1 4 2.2 61.8 0.3 (0.0) 70.2 90.2 7.2 46.0 55.0 6.6 1417 1.560 95.4 86.5 89.3 0.0 93.0 0.9 84.2 0.3 0.0 83.7 82.9 9.9 16.0 23.0 6.5 1600 1.777 95.5 86.0 89.6 0.0 92.0 5 2.4 61.3 0.4 0.4 86.2 84.7 7.1 9.0 10.0 6.8 1300 1.892 96.1 87.8 91.5 15.0 92.0 6 3.4 63.9 0.7 0.6 91.8 88.6 7.1 9.0 5.0 7.0 1300 2.238 96.3 89.0 92.0 16.0 78.0 Q2 3.4 67.2 0.7 0.6 87.0 85.2 7.3 34.0 12.0 6.9 1400 2.238 96.0 87.6 91.0 16.0 82.0 Financial 1. EBIT (M EURO), cum M 1.5 3.a Break-even point (%) (Excl Subcon) M 53.7 4. Business Renewal Cost Savings (M.Euro), cum 0.0 M 5. Purchasing Savings (M.Euro) Cum M 0.1 Customer 1. Customer Satisfaction % M 63.8 2. RLIP(%) M 90.3 3. Stacked Leadtime, 95% tile (days) M 6.9 4a. Number of PSX Cust Complaints (#) M 20.0 4b. Number of automotive Complaints (#) M 15.0 5. TPT customer Complaints, 90% tile (days) M 6.6 Process 1. Assembly Yield (PPM) M 1464 2. Cost of Non-Quality Improvement (M.Euro), Cum 0.429 M 3. SPC Assy CpK > 1.67 (%) M 95.2 4. Assy Asset Operational Utilisation (%) M 85.0 5. Test Asset Operational Utilization (%) M 89.7 Learning 1. Number of black&green belts trained #, M Cum 0.0 2.Skill Matrix Score M 89.0
1386 1400 1.060 1.563 95.3 95.7 87.3 87.2 89.3 88.9 0.0 91.0 0.0 92.0
Define and Measure
Define: Clearly State the Problem
Manage
in terms of “Defects” or “Variation” which Upset the Customer/Management
“Correct” (In-Spec.) DefectFree!
PIV PIV PIV PIV
Process
POV
CTQ
Measure: Describe the Performance of
the Process Quantitatively
Measured Units Counted Units
then, Identify Key Inputs
Analyze
Manage “Correct” (In-Spec.) PIV PIV PIV PIV DefectFree!
Process
POV
CTQ
Analytically Describe the Relationship Between
Inputs and the Output . . . to Find the Inputs with the Biggest Impact on the Output
Improve
Manage “Correct” (In-Spec.)
DefectFree!
High Low Medium High
????????
PIV PIV PIV PIV
Process
POV
CTQ
Systematically Find the Combination Which Delivers the Optimal Output
Control
Control Control Control
Manage
“Correct” (In-Spec.)
Process POV
DefectFree!
High Low Medium High
PIV PIV PIV PIV
CTQ
Lock In the Inputs to Routinely Generate
the Optimal Output!
What’s Included
Six Sigma is not all new; but is a strategic assembly of proven techniques that have been used effectively for many years
What’s new
Def’n
What’s not
• Software (Minitab) • Team structure • Roadmap • Gage Studies • Train - Apply -Review • Capability • Non-manufacturing • SPC projects • DOE • Design Projects • Voice of the Customer Which Will Customers Need, Want, or Be Willing to Pay For?
The Focus of Six Sigma
Y=
f (X)
To get results, should we focus our behavior on the Y or X ? ? Y ? X1 . . . XN ? Dependent ? Independent ? Output ? Input-Process ? Effect ? Cause ? Symptom ? Problem ? Monitor ? Control
If we are so good at X, why do we constantly test and inspect Y ?
Focus on X rather than Y, as done historically
Leadership & Knowledge Building
Six-sigma won’t succeed without leadership and you can’t lead what you do not understand
35
Fundamentals of 6 Sigma Project Selection
• Must be driven by leadership • Must be focused on opportunities that are real and important to the business • Usually based on either business financial or customer performance • Approach may be quantitative and scientific - is always logical • Involves people who are familiar with and accountable for process performance • Moves from broad and high-level to precise, narrow and specific • Ends with a Project charter
36
“There is nothing so useless as doing efficiently that which should not be
done at all.”
- Peter F. Drucker
39
CAUSAL THINKING AND LEADING INDICATORS
Y = f (X1, X2, X3, X4, …. , Xn)
40
WE’RE DIFFERENT
There is no such thing as “WE’RE DIFFERENT”.
41
PROCESS PRIORITIZATION
Processes
CTQ ‘s
PROJECTS
Leveraging for maximizing benefits.
42
For God’s Sake!
• Don’t Convert it to another Statistical exercise - An intellectual perversion! • Keep It focused to the Issue on hand. • Don’t Get bogged down to prescriptive Course content. Every day new and
simpler theories are taking birth, thus
have open mind!
Statistics is not everything
Support!different situations by specific tools
An Example
2002
Roll out
2003
Initiation
2004
Integeration1
2005
2006
Integeration2 Institutionalization
# Champion 70 # GBs 394 # BBs 34 #Projects 164 Low handing Fruit $ 3.2 billion Manufacturing only Hoshin Kanri
Mfg.&After Sales
# Champion 34 # GBs 80 #Projects 20 $ Not calculated
# Champion 70 # GBs 555 # BBs 61 # MBB 25 #Projects 329 $ 5.7 billion Hoshin Kanri Mfg.,After Sales & Engineering
# Champion 70 # GBs 706 # YBs 150 # BBs 86 # MBBs 25 #Projects 523 $ Integrated with budgeting
Balanced score Card
# Champion 85 # GBs 766 #YBs 300 # BBs 86 # MBBs 25 #Projects 594
EFQM,
Mfg. &Enablers
Customer Processes
Suppliers & whole Group Co.
Over The Years
Agerage pre-dispatch audit score for a product
120 117.445
Avg. Pre-despatch audit score
110
109.150
100
90
90.555
83.065
81.765
80 2001 2002 2003 Year 2004 2005
80.345
2006
Pre-dispatch audit score is obtained from Regulatory Body/Customer Representative audit
Pre-Dispatch Audit Scores are means to capture Customer satisfaction ratings.
• The “people side” of 6 Sigma is ignored, with focus directed exclusively or primarily on the technical aspects of the improvement Projects • Those on the “front lines” of the 6 Sigma initiative -i.e., the Black Belts and Master Black Belts -- often lack the skills necessary to build commitment to improvement Projects, communicate with stakeholders, deal with resistance, manage effective teams, and otherwise deal with the non-technical elements of 6 Sigma Projects*
Why the problems occur
High
The implications of ignoring non-technical aspects during change. 5
4
Score 4-5; world-class; 6 Sigma is in the DNA; it’s the way we work; “order of magnitude” payback
The degree to which 3 positive conditions for 6 Sigma 2 success exist in an 1 organisation
Score 3-4; cultural transformation beginning but may take longer; payback significant
Score 2-3; significant tactical results, but 6 Sigma remains just a “programme” but “normal” payback
Score 1-2; some tactical results ; 6 Sigma will probably die; we only get our costs back. Score 1 or less; change will fail; costs of training & consultancy will be lost The likely outcome
With acknowledgements to EAI
Low
0
doc_517857189.pptx