Workshop October 2015

Research (research current state) Stage 2 Research (research current state)

1. Understand area of focus to be benchmarked 2. Define performance measures 3. Identify current performance 4. Prioritise and finalise the practices to be benchmarked 5. Review project progress and TOR 6. Obtain approval to start the next stage of TRADE Equipment errors Information errors Time taken Focus on best practices in: Equipment transfer Information transfer (training, utilisation of space, speed, managing small teams, safety systems)

Step 1 – Understand area of focus to be benchmarked Literature review Review of company documentation Process flow charts Brainstorming Questionnaires Structured interviews Focus groups Expert presentations

There is a variety of company documentation that may help you to have a better understanding of your project Annual reports Financial ratio analysis Operational performance reports Minutes of meetings Patents Audits Operational and quality system manuals Business excellence assessments Questionnaire data Project files Previous benchmarking projects Process flow charts

The Fishbone Diagram is a good tool to use to aid in the understanding of a problem/issue Management Man Method Cause Cause Cause Cause Cause Cause Cause Cause Cause Effect Cause Cause Cause Effect = problem statement Cause Cause Cause Cause Cause Cause Measurement Machine Material

Example of a Fishbone Diagram applied to the airline industry

Drawing a process flow chart will help team members to better understand the current process and the main areas for improvement

Common process flow chart symbols

4/25/2017 Definitions Process: Any activity or series of activities that takes an input, adds value to it, and provides an output to a customer. System: A group of processes that are related and may or may not be connected. BPI Presentation 10

The Process Picture Process Add Value Prevent Errors Identify Errors Correct Errors Requirements Requirements Supplier Customer Input Output Feedback Measurement System Feedback Feedback

Process Hierarchy Processes Processes Processes Sub-Processes What is the BPI Methodology? It makes use of the people involved in the process to measure, analyze, document, streamline, benchmark, and improve the process. Business Process Levels Macro-process: The work flow that is required to conduct a major business objective. Sub-processes: A logical, related, sequential set of work flow that makes up a major part of the macro-process. Activities: Things that take place within the process. They are usually performed by units of one (one person or one department). Tasks: Detailed steps taken to perform an activity. Activities Tasks

Each symbol on the flowchart provides an opportunity for improvement Operation symbols Decision symbols Inspection symbols Delay symbols Documentation symbols File symbols Transportation symbols

4/25/2017 Process loops or branches are opportunities for improvement/ streamlining Main Loop Branch BPI Presentation 14

Using a Rainbow Flowchart where colours illustrate different types of processes or opportunities for improvement can be very useful Bureaucracy Business Value-Add Start End No Yes No Value-Add Value-Add

High level of bureaucracy Out-of date processes Overly complicated 4/25/2017 When reviewing the area of focus you are likely to identify many opportunities for improvement and potential solutions High level of bureaucracy Out-of date processes Overly complicated Not used processes Costly Time consuming Irritating Record potential solutions as you proceed through the project BPI Presentation 16

Step 2 – Define performance measures Cost – for example, labour cost, material cost, product/service cost Quality – for example, error rate, complaint levels, defect levels Time – for example, production time, cycle time, value added time, changeover time, delivery time, response time Value – for example, customer satisfaction, staff satisfaction, community satisfaction

Performance Measures Record Sheet Type of measure Purpose Relates to Benchmark Target Current performance Formula Frequency Who measures? Source of data Who acts on the data? What do they do? Notes and comments

7 reasons for measuring performance and recognising success What gets measured gets done; If you don't measure results, you can't tell success from failure; If you cannot see success, you cannot reward it; If you cannot reward success, you are probably rewarding failure; If you can't see success, you can't learn from it; If you can't recognize failure, you can't correct it; If you can demonstrate results, you can win public support. Osborne, David, and Ted Gaebler. 1992. Reinventing Government: How the Entrepreneurial Spirit Is Transforming the Public Sector. Reading, MA: Addison-Wesley.

Step 3 – Identify current performance What is your current performance? Historical trends?

Step 4 – Prioritise and finalise the practices to be benchmarked Review your findings from steps 1 to 3 and decide if you want to stick with your current Terms of Reference or make the project smaller or bigger… Whatever you decide. Make sure you prioritise which processes are most important to improve!

Area of focus – inconsistent customer service levels Break the “area of focus” down into its component parts and prioritise what is most important to improve Area of focus – inconsistent customer service levels

Examples of prioritisation criteria Does the process/practice/issue show a direct linkage to strategic direction and current objectives? Is the problem frequent/infrequent or critical/non-critical? Is the process owner behind the project and supportive of change? Can results be obtained within 6 months? What is the likelihood of finding better practices? What would be the likely cost of implementation?

Step 5 - Review project progress and TOR Step 6 – Obtain approval to start the next stage of TRADE