Operation Management Project
Creating a Process Inventory and Hierarchy
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What is a Process?
Process
If you can't describe what you are doing as a process, you don't know what you're doing.
W. Edwards Deming
US business advisor & author (1900 - 1993)
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Components of Process Management
Process Management
Inventory
Model
Improve-ment
Monitor
Process Inventory
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A complete and living list of processes that are performed by an organization or department. Level of granularity will vary and evolve.
Creates a baseline reference:
modeling efforts
process improvement prioritization
metrics.
Initial inventory must be completed before any serious modeling or process improvement effort begins.
Facilitated by a Process Improvement Analyst or by a qualified team member. Involves all applicable process participants.
Process Inventory
What
Why
When
Who
Identifying the Process Inventory
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Interview the process participants
Consult existing documentation
Read job descriptions
Practice the principle of GEMBA
Identify the products and outputs and work backwards
Peruse archive emails to identify intra/interdepartmental interactions
Gemba:
In order to really understand a process, you have to go to the spot where the work is being done.
Part of a bigger philosophy known as the ’3 Reals’.
You have to go to the
(1) real place to observe the
(2) real thing to get the
(3) real facts and data.
Hierarchy
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A hierarchy (Greek: hierarchia (ἱεραρχία), from hierarches, "leader of sacred rites") is an arrangement of items (objects, names, values, categories, etc.) in which the items are represented as being "above," "below," or "at the same level as" one another. Abstractly, a hierarchy can be modelled mathematically as a rooted tree: the root of the tree forms the top level, and the children of a given vertex are at the same level, below their common parent.
Example: Dewey Decimal System
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Example: Organizational Hierarchy
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Example: Biological Classification
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Example: Project Plan
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Organizational Focus Inventory
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Team or Department
Function or Division
Enterprise
Organizational Inventories are focused on the processes performed by organizational units (groupings of people). Vertical and silo’d
Goal:
Optimize the people. Improve productivity and reduce costs from human resources
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Value Chain (Functional) Inventory
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Value Chain Inventories are focused on the high-level processes performed across an organization (cross functional and horizontal)
Goal:
Optimize cross-functional processes. Reduce cost, Reduce risk. Improve quality.
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Process Classification Framework
http://www.apqc.org/process-classification-framework
American Productivity & Quality Center (APQC).
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Process Hierarchy
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Process Hierarchy
Creating a Process Hierarchy
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Decide upon the hierarchy structure (organizational or value stream)
Affinitize and dedupe (consolidate equivalent processes)
Understand if work represents a task, activity, sub process, process, or category
Distinguish between WHAT is done (process) and WHO performs it (resource)
Use a common naming standard (i.e. usage of nouns vs. verbs)
Seek wide input from relevant stakeholders
Limit number of items per hierarchy level to 5-7
Hoshin Kanri
Developed by Toyota and Kaoru Ishikawa in 1953
Hoshin - - direction, compass, policy, plan, aim ….
Kanri - - management, control, charge of …..
Hoshin Kanri is based on Deming’s PDCA Checklist – Added Policy & Planning.
Policy Deployment – common translation used by Western Companies
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Hoshin Kanri
Hoshin Kanri is:
“Ship in a Storm on the Right Path”
Shining metal or compass
Strategic policy deployment
Systematic planning methodology for defining long-range key entity objectives
Usually defined to 2-5 years
The hoshin process does not lose sight of the day-to-day "business fundamental" measures required to run the business successfully
This approach provides a plan over an extended period of time so the organization can focus on breakthrough effort while continuously improving key business processes day to day
Hoshin Planning
Hoshin ensures that everyone in the organization is working toward the same end.
The plan is hierarchical, cascading down through the organization and to key business-process owners
The hoshin process fits under the umbrella management philosophy of total quality management