ISA 201 Intermediate Information Systems Acquisition

Lesson 14 Continuous Process Improvement and Business Process Reengineering

Today we will learn to: Identify the DoD policy that describes the Implementation and Management of the DoD-Wide Continuous Process Improvement Program Define Continuous Process Improvement (CPI) Define Business Process Reengineering (BPR) CPI & BPR

Business Process Reengineering (BPR) Lesson Plan Business Process Reengineering (BPR) Continuous Process Improvement (CPI) Principles of Lean Exercise Principles of Six Sigma CPI & BPR

Business Process Reengineering (BPR) Defined “The fundamental rethinking and radical redesign of business processes to achieve the dramatic improvements in critical contemporary measures of performance, such as cost, quality, service and speed.” DoDI 2009 5010.43 The Department defines BPR: a logical methodology for assessing process weaknesses, identifying gaps, and implementing opportunities to streamline and improve the processes to create a solid foundation for success in changes to the full spectrum of operations.” 2012 DoD Business Process Reengineering Assessment Guidance CPI & BPR

Why BPR? Subtitle III of Title 40 of the United States Code (AKA Clinger-Cohen Act) requires BPR. Section 1072 of the National Defense Authorization Act (NDAA) for Fiscal Year 2010 introduced new requirements into the Department’s investment review process stipulating defense business system (DBS) modernizations may not be certified to obligate funds in excess of $1 million without a determination of whether appropriate business process reengineering (BPR) had been completed. 2012 DoD Business Process Reengineering Assessment Guidance It’s the Law! CPI & BPR

Performing BPR The DoD does not mandate a specific BPR methodology. The goal of BPR is to ensure that the business processes supported by the DBS have been streamlined, and/or eliminated or unique requirements and interfaces have reduced to the maximum practical extent. 2012 DoD BPR Assessment Guidance Standard. CPI & BPR

Performing BPR Functional Sponsor and PM are responsible for completing assessment form prior to IRB 13 assessment questions requiring tailored objective evidence based upon submission type: Development Modernization Research Technical Refresh Sustainment. Source: Appendix B, 2012 DoD Business Process Reengineering Assessment Guidance CPI & BPR

Continuous Process Improvement (CPI) Lesson Plan Status Business Process Reengineering (BPR) Continuous Process Improvement (CPI) Principles of Lean Exercise Principles of Six Sigma CPI & BPR

CPI Defined “Continuous Process Improvement—a comprehensive philosophy of operations that is built around the concept that there are always ways in which a process can be improved to better meet the needs of the customer and that an organization should constantly strive to make those improvements.” 2008 Continuous Process Improvement /LSS Guidebook Revision 1 CPI & BPR

CPI Policy “A robust, effective CPI/LSS program will leverage the right tools and methods for problems being addressed, including Lean Six Sigma, theory of constraints, and business process reengineering.” 2009 DoDI 5010.43 CPI & BPR

CPI Guidebook CPI provides organizations a structured approach for analyzing how they are currently doing work and how they can improve their processes to do the job more efficiently and effectively on an ongoing basis. Process improvements resulting from applying CPI effectively will greatly benefit the Department, in terms of both improved operations and reduced resource consumption. Application of tools from Theory of Constraints, Lean and Six sigma will improve both production and service processes. CPI & BPR

Principles of Lean Lesson Plan Status Business Process Reengineering (BPR) Continuous Process Improvement (CPI) Principles of Lean Exercise Principles of Six Sigma CPI & BPR

Lean A methodology for continuous process improvement, focused on work flow, customer value, and eliminating process waste; unique from traditional process improvement strategies in that its primary focus is on eliminating non-value added activities 2009 DoDI 5010.45 CPI & BPR

Key Lean Concepts Five Principles of Lean Thinking: Specify the value of a process from the customer’s perspective. Identify the value stream for each process ELIMINATE WASTE: Make value-creating steps flow The customer must pull value through the process Continuously pursue perfection Source: Lean Thinking, Womack and Jones CPI & BPR

Eight Sources of Waste CPI & BPR

Exercise Lesson Plan Status Business Process Reengineering (BPR) Continuous Process Improvement (CPI) Principles of Lean Exercise Principles of Six Sigma CPI & BPR

Eight Sources of Waste Exercise “When you are agile, you get lean” (Pages 1-4 – Student CD) Describe the principle and provide your assessment and at least 1 example Team 1: Inventory in software development Team 2: Motion in software development; Waiting in software development. Team 3: Over-production in software development; Team 4: Over-processing in software development Team 5: Transport in software development; Defects in software development;

Principles of Six Sigma Lesson Plan Status Business Process Reengineering (BPR) Continuous Process Improvement (CPI) Principles of Lean Exercise Principles of Six Sigma CPI & BPR

Six Sigma A disciplined, data-driven methodology for process improvement that focuses on satisfying customer requirements while minimizing waste by reducing and controlling process variation. 2009 DoDI 5010.43 Six Sigma evaluates a process in terms of performance, accuracy, and consistency—Reduce Variation of Processes CPI & BPR

Variation What Is It? General Principles “Short Answer.” A change in the value of a measured characteristic “Long Answer.” The difference between things that are produced under conditions that are as nearly alike as it is possible to make them No two products or characteristics are exactly alike because any process contains many sources of variability General Principles No two things are alike Variation can be measured Individual outcomes are not predictable Groups form patterns with definite characteristics CPI & BPR

Variation: Common And Special Causes Time If only common causes of variation are present, the output of the process forms a distribution that is stable over time and is predictable If special causes of variation are present, the process output is not stable over time and is not predictable. CPI & BPR

Six Sigma Methodology CPI & BPR

CPI & BPR Review BPR—fundamental rethinking and radical redesign of business processes Lean—eliminating non value adding waste from our process Six Sigma—reduce variation in key process attributes leading to stable and predictable outcomes CPI & BPR

Today we learned to: Identify the DoD policy that describes the Implementation and Management of the DoD-Wide Continuous Process Improvement Program Define Continuous Process Improvement (CPI) Define Business Process Reengineering (BPR) CPI & BPR