CHAPTER 1

Introduction to Streamlined Process Improvement (SPI)

Business Process Improvement (methodology) investigated and established byDr. H. James Harrington and his group [represents] some of the new strategieswhich bring revolutionary improvement not only in [the] quality of products andservices, but also [in] the business processes which yield the excellent qualityof the output.

—Professor Yoshio Kondo,the leading Japanese quality authority

Introduction

We have more opportunities to improve our processes than we have problems tosolve.

—H. James Harrington

This book is designed to help you streamline your processes, making themmore efficient and effective. This will allow you to sell your products andservices at a lower price and still make more profit than your competitors. Incar design, streamlining reduces an auto's air resistance, making it operatemore effectively and making it more attractive to customers. On the other hand,a lean car has only the essentials.

When you streamline your processes, they operate at lower cost and cycle timeand at increased efficiency and effectiveness. (See Figure 1.1.) Inaddition, the resulting changes are implemented with much less resistance andgreater acceptance by the management team and the employees than processesredesigned using reengineering, DMADV, or Design for Six Sigma methodologies.

Today we hear a lot about Lean Six Sigma—it is the removal of all wastefrom the organization. Currently, most organizations could be represented by theoverweight person in Figure 1.2.

Our processes are full of bureaucracy and waste. As we run into a problem, wejust add more and more bureaucracy so that the problem will not reoccur. Thisjust wastes time and money. A Lean Six Sigma organization could be representedby the person in Figure 1.3.

As you can see, the person in the figure is very lean; all fat has been removed.People who are that thin have often gone to extremes to lose the fat and keep itoff, but in doing so, they have thrown their body's meaningful checks andbalances out of kilter. They have often lost their natural protection fromdisease (problems) and are susceptible to any and all of the diseases that comealong. Toyota got into its quality and recall problems because it got too lean.The streamlined organization can be represented by the figure in Figure1.4.

With streamlining you may start out as the person depicted in Figure1.2, but after beginning an exercise program, you lose (remove) the wasteand transform fat into muscle. You feel better, are healthier, and are morecreative. You streamlined not only the processes, but also the way you think andgo about doing business.

Streamlining Fundamentals

The following are the key fundamentals that must be considered when youundertake to streamline a process:

1. The process to be streamlined should be chosen based on how valuable it is tothe organization, how badly the process is broken, and what the impact upon theorganization would be if the process were improved.

2. It is a mistake to try to improve too many processes at the same time. Doonly three or four at a time.

3. A good database that measures performance of the current process should be inplace before you make changes to the process. This is necessary so that you willbe able to accurately measure the impact that the future-state solution has onthe organization.

4. The way to begin is to ask the question, Is the process essential to theorganization?

5. Simplification is better than computerization.

6. The real value of a process is how well it interacts with the otherprocesses.

7. The best-designed process is worthless if it is not accepted by the peoplewho will be using it.

8. Excellent communication and trust are key elements in making the streamlinedprocess methodology a success.

9. The executive team needs to understand and fully support the SPI methodologyand the output from the Process Improvement Team (PIT).

10. The external customer is the one who defines what the output from theprocess needs to be.

11. The combination of the process and the internal customer requirements mustprovide the organization with the best overall value. Internal customers'desires may not be honored unless they add value to the organization.

12. The white-collar processes have potential for quantum improvement.

13. The processes that service the external customers should be optimized, andthe others should be designed to support them.

14. The total process key measurements need to be improved, not the measurementsthat are related to subprocesses within the major process.

15. The key process improvement indicators are increased external customersatisfaction, reduced output costs, reduced cycle time, and increased employeemorale.

16. The people who will be key players in using the process should be includedin the SPI projects.

17. The risks have to be understood before any changes are made to the process.

18. Streamlining requires resources; it can't be accomplished without a budgetand people assigned to it. The employees assigned to the PIT should have theirworkload in other areas reduced by 20 to 40 percent.

19. The variation in the cycle time and output quality should be minimized.

Technology Warning

All too often, organizations jump to automate their processes without evaluatinghow effective the processes can function without being automated. This isusually a major error, as technology should serve the processes, not the otherway around. Frequently, technology will speed up your processes so that you areable to make more errors faster than ever before. In other words, if the processis bad, automating it just causes an automated mess. Since technology is anenabler, rather than a process driver, it should only be applied after theprocess is streamlined. Far too often we automate a process or use technology toexpedite the process when we should be...