Online financial courses - The best source of advice comes from the Short Courses


Online Financial Courses - Process Improvement

Provided by : Matt H. Evans
Adress: 6903 29th St N ; Arlington, VA 22213
Phone number : 1-877-689-4097
Email: matt@exinfm.com

Course 5: Process Improvement

Chapter 2: Fundamental Tools of the Trade

Regardless of how you go about improving a process, you will most likely use one or more of the following tools:



Therefore, a solid understanding of each of these tools can help almost any process improvement project. This chapter will highlight each of these tools. And some of these tools may get applied above or below the process level to get a better understanding of what takes place outside the process layer within the enterprise architecture:



"The problems that afflict modern organizations are not task problems. They are process problems. The reason we are slow to deliver results is not that our people are performing their individual tasks slowly and inefficiently -We are slow because some of our people are performing tasks that need not be done at all to achieve the desired result and because we encounter agonizing delays in getting the work from the person who does one task to the person who does the next one. In short, our problems lie not in performance of individual tasks and activities, the units of work, but in the processes, how the units fit together in the whole." - Beyond Reengineering by Michael Hammer
sitemap | top

SWOT Analysis

Where processes are impacted by both internal and external factors, it can be useful to apply SWOT - Strengths, Weaknesses, Opportunities, and Threats. SWOT Analysis is a standard tool used by all types of analyst for identifying major strategic issues. SWOT can be used at any organizational level - function, department, group, etc. SWOT is defined as:

- Strength: Any existing or potential resource or capability within the organization that provides a competitive advantage in the market.
- Weakness: Any existing or potential internal force that could serve as a barrier to maintaining or achieving a competitive advantage in the market.
- Opportunity: Any existing or potential force in the external environment that, if properly exploited, could provide a competitive advantage.
- Threat: Any existing or potential force in the external environment that could inhibit the maintenance or attainment of a competitive advantage.
You can also fast track the assessment process by simply doing a simple T list of the pluses and minuses.

sitemap | top

Root Cause Analysis

Root Cause Analysis is used to clearly understand what’s driving or causing a problem. The key is to identify the factors influencing the effect you are starting with. One way to jump start the analysis is to look at:

- 4 M’s: Methods, Manpower, Materials, Machinery
- 4 P’s: Policies, Procedures, People, Plant

Root Cause Analysis is often expressed in the form of a fishbone diagram. The steps for doing the diagram are:

1. Specify the effect to be analyzed. The effect can be positive (objectives) or negative (problems). Place it in a box on the right side of the diagram.



2. List the major categories of the factors that influence the effect being studied. Use the "4 Ms" (methods, manpower, materials, machinery) or the "4 Ps" (policies, procedures, people, plant) as a starting point.



3. Identify factors and sub factors. Use an idea-generating technique to identify the factors and sub factors within each major category. An easy way to begin is to use the major categories as a catalyst. For example, "What policies are causing…?"



4. Identify significant factors. Look for factors that appear repeatedly and list them. Also, list those factors that have a significant effect, based on the data available.

5. Prioritize your list of causes. Keep in mind that the location of a cause in your diagram is not an indicator of its importance. A sub factor may be the root cause to all of your problems. You may also decide to collect more data on a factor that had not been previously identified.

A less formal approach to root cause analysis is to simply use the Five Whys technique. With each reiteration of why (say five times), you pull out additional information that possibly helps you identify the root cause of a problem.
sitemap | top

Pareto Chart

In order to focus on significant problems, you can rank the importance in descending order of occurrence. This is typically done using the Pareto Chart. In order to chart problems, you must:

1. Identify the problems that need to be ranked.
2. Use a standard measurement for ranking, such as frequency, costs, etc.
3. Determine the time frame for evaluating the problems.
4. Collect the data from existing reports or use new data.
5. Label the units of measure on the left vertical axis and label the problem areas on the horizontal axis.
6. Plot the data, showing the descending order from left to right.

sitemap | top

Process Mapping

Process Mapping is regularly used to depict the flow of major activities within a process. Process maps range from simple block diagrams to more elaborate swim type diagrams showing the "swimming" flows to and from major functional or organizational units that play a role within the process.

In order to flowchart or map a process, you will need to understand the activities, what triggers the activity (inputs), who is involved, the sequential steps, and the outputs associated with the steps. This will require interviewing people assigned to doing the activities. You will also need to examine documents, such as desk procedures, work flow diagrams, and other documents that help describe how the process works.

Process maps allow you to see the big picture, clarifying sub-processes, sequences, and activities. Process maps should be prepared showing critical information flows and different players involved. Where possible, it is useful to document cycle times in different steps; especially wait times. Once completed, you can use the process map to answer certain critical questions:

1. Can we eliminate or reduce certain activities?
2. Can we complete the process in less time by changing the process?
3. Can we improve how we meet customer requirements by changing the process?

Finally, if you are unsure what processes to map, start with those processes that have high impact in terms of costs, time, resources consumed or waste. Core processes are sometimes easier to map due to existing documentation and easy access to the internal players as opposed to external players.

sitemap | top

Brainstorming

Brainstorming is used to generate ideas without any real regard for the merit of the ideas. You can evaluate the ideas after the brainstorming session is over. Here are some basic guidelines to follow:

1. Start with a clear definition of what it is you are trying to solve.
2. Make sure everyone understands the problem or issue.
3. Write down all ideas and don’t judge anything submitted.
4. Give everyone a chance to participate and express opinions.
5. Try not to be too formal, but impose some structure to ensure the brainstorming session is productive.
6. Don’t get discouraged if the brainstorming session starts off slow - the best ideas usually get generated at the end of the session.
7. Try to write down all ideas exactly as they are submitted by participants.
8. Make sure you have a broad mix of people in the brainstorming session - process owners, customers, vendors, subject matter experts, etc.

One of the biggest misconceptions about brainstorming has to do with group brainstorming. Some of the best ideas come out of individual brainstorming where each individual has time to think about the problem and submit comments separately. It’s also useful to have a "culture" that nourishes ideas. This provides a natural environment for highly productive brainstorming.
sitemap | top

Storyboarding

Storyboarding is a visual approach to brainstorming. Like brainstorming, it attempts to organize multiple ideas and concepts. Unlike brainstorming, it tends to be less structured, allowing for more open participation by anyone who can help get the group to a common idea. Storyboarding will also require that you group and categorize ideas since you want to visually show how things work. For example, you might show initial events or activities off to the upper left on a large white board and then work your way down, visually showing how things flow downward.

To make sure you can storyboard, you’ll need large white boards or butcher paper as well as markers, cards, and other supplies to help illustrate your concept. Use different colors to group and organize common elements. You can take a digital photo of the output and refer back to it for later development.

"A process cannot be changed unless all the supporting elements are changed as well. Therefore an essential early step of a reengineering effort is to clearly identify and quantify all of the resources in a corporation that are dedicated to each specific process." - The Reengineering Handbook by Raymond L. Manganelli and Mark M. Klein
sitemap | top

Force Field Analysis

Force field analysis is used to visually show relationships that help or hinder a solution to a problem. Force field analysis provides a quick list of factors that influence your objective. Here are the basic steps:

1. Define the problem or objective that you are analyzing.
2. List the forces that impact or influence your problem. Use an idea generating technique like brainstorming.
3. Assign weights or priorities to each force on your list. Place heavier weights on those forces that have the highest impact.
4. Manage based on the list - try to reduce the negative forces and maximize the positive forces to solve the problem.
Focus your efforts on those forces that are easy to implement and yet at the same time, they produce high results. Listed below is an example of how force field analysis is used to help someone stop smoking:

sitemap | top

Value Analysis

One of the most important techniques for improving a process is to make a distinction between value added and non value added activities. Value analysis summarizes all activities between value added and non value added. This distinction is made as follows:



In order to organize your analysis, construct a table with three columns - listing your activities in column 1, denoting the activity as Value Added or Non-Value Added in column 2 and a description or comment on why the activity was classified as Value Added or Non-Value Added in column 3. If possible, try to estimate the costs of each activity so you can prioritize your analysis for further action. The goal is to optimize the value-added activities so they are lean and reduce or eliminate the non-value added activities. Listed below is an example for a Receiving Department:

sitemap | top

Issues Analysis

It is often useful to break a problem down into components. Issue analysis is used to define the elements of a problem and show these elements in some logical way. This is often accomplished by using an issue tree:



You can use the issue tree to show sub-processes at different levels with the process or activity above flowing into the lower one. Some key points to consider:

- Use the Issue Tree to guide you into underlying root causes.
- Look for duplication between the activities within the Issue Tree.
- Validate relationships between problem components by involving process owners and other stakeholders.
sitemap | top

Solutions Rating Matrix

The solution rating matrix is a process for weighing all the possible solutions against a predetermined set of criteria or rules. Examples of criteria or rules for weighting include: - Ease of implementation
- Effectiveness of solution
- Probability of success
- Resistance to solution
- Cost

Make sure your weights total up to 100%. Now organize your solutions into a matrix and rate each solution on a scale from 1 to 10. Finally, you can multiply the rating scores by the weighting percentages to arrive at the total score. Listed below is a simple example of a solutions matrix for deciding which automobile you should purchase. Based on five criteria, Car "B" is the selected choice:

sitemap | top

Trend Analysis

One of the basic tools in evaluating a process is to look at trends. Most trends are reported in a time series graph. This allows a comparison, prompting action on unfavorable trends and recognizing the need to adjust targets on constant favorable trends. The basic steps for trend analysis are:

1. Select a specific process, sub-process or activity with outputs.
2. Collect the measurement data on the outputs over consistent time intervals.
3. Monitor performance and see if you need to adjust the process, sub-process, or activity to change performance.

A few tips to consider when doing trend analysis:

- The best outputs or measurements are usually linked to customer needs.
- Collect your measurements at good time intervals that facilitate the right degree of management control. Measurements that are too late are useless to managers. Constantly measuring the same things over and over with no corresponding action is also useless.

Simple Example of Trend Line Analysis
sitemap | top

Project Management

Much of the work that goes behind improving a process has to do with good project management practices. Larger type initiatives take the form of a formal project, especially Six Sigma type projects. Therefore, sound project management practices are extremely important for major process improvement projects. Here are some important concepts to consider:

- Define your scope for improving a project by breaking the scope down into workable elements that you can manage. This is usually accomplished in the form of aWork Breakdown Structure, allowing you to delegate activities and tasks to other team members. You need this structure for managing all of the components that make up the project.
- Develop a work schedule for major milestones throughout the expected life cycle of the project. This work schedule should include your expected costs as well as anticipated start and completion dates.
- Where the stakes and costs are high, consider including a risk management plan as part of how you manage the project. The Risk Plan should address the "what if" situations that may arise during the course of the project.
- Another useful plan to include is a quality assurance plan. You need to have control checks in place to make sure things are getting done right.
- Although it can be somewhat subjective, many executives will probably want some form of cost benefit analysis, showing the Return on Investment for the project. It’s also useful to include a Net Present Value in your business case for the project.
- After you complete the project, you need to conduct a post implementation audit, determining if the project met its original objective and goals. You also want to flush out lessons learned for executing future projects.

NOTE: Short Course 6 provides much more in-depth coverage on project management, including information on how to build a detail project plan and measure project performance.
sitemap | top


Chapter 1: Some Good Starting Points
Chapter 2: Fundamental Tools of the Trade
Chapter 3: Capability Maturity Model (CMM)
Chapter 4: Six Sigma
Chapter 5: Lean Thinking
Chapter 2 points
SWOT Analysis
Root Cause Analysis
Pareto Chart
Process Mapping
Brainstorming
Storyboarding
Force Field Analysis
Value Analysis
Issues Analysis
Solutions Rating Matrix
Trend Analysis
Project Management


10 Upcoming learning videos : in all categories



Selected learning videos for today


learn video about : Explaination about the theory of plate techtonics in geologyExplaination about the theory of plate techtonics in geology
learn video about : Differentes types of rocks in geologyDifferentes types of rocks in geology
learn video about : Geology lecture titled Macro evolution in the deep sea by SeilacherGeology lecture titled Macro evolution in the deep sea by Seilacher
learn video about : Geological evidence of Darwin theory of evolution that still mattersGeological evidence of Darwin theory of evolution that still matters
learn video about : The meaning of Limestone and shale cycles in the upper ordovicianThe meaning of Limestone and shale cycles in the upper ordovician
learn video about : Geologic carbon sequestration and mitigating climate change by inection of CO2Geologic carbon sequestration and mitigating climate change by inection of CO2
learn video about : Geology and mineral resources of oclahoma by Ken JohnsonGeology and mineral resources of oclahoma by Ken Johnson
learn video about : How to calculate the budget line and prices if you know incomeHow to calculate the budget line and prices if you know income
learn video about : Ecuador geology and volcanology given by Dr throfilosEcuador geology and volcanology given by Dr throfilos
learn video about : This video is about Mexico volcanos and Mexico Geological phenomenonThis video is about Mexico volcanos and Mexico Geological phenomenon
learn video about : Explanation about the 3 type of rocks and the relationship between themExplanation about the 3 type of rocks and the relationship between them
learn video about : Learning english vocab for ESL - project managementLearning english vocab for ESL - project management
learn video about : How to pronunciate words starting with BHow to pronunciate words starting with B
  1. What happens when we pull on a pulley and the pulley is pulling on other things?


  2. Tension in an accelerating system and pie in the face


  3. A more complicated friction/inclin ed plane problem


  4. Calculating the acceleration of on object sliding down an inclined plane


  5. Phisics cours - Introduction to friction


  6. Physics explanation about Mass on Inclined Plane


  7. Learning physics - A slightly more difficult tension problem


  8. Learning physics-An introduction to tension


  9. Physics topic explaining Force with Vectors


  10. Explanation about Newton's Laws and vectors