1. Introduction to Business Process Reengineering

2. Introduction The need for process improvement
Process improvement methodologies
TQM, Lean, CMMI, Six Sigma, ISO 9001

3. Process Improvement (Origins)
Process improvement and project management started with some very large projects and finding better ways to manage them
Shipbuilding
Large scale engineering projects
Defense projects
Etc…

4. The Need for Process Improvement
Business and technology changes over time and process must reflect those changes
Look at the impact of the mobile phone and the Internet the way we do business
Companies improve processes to
Become more efficient (share data, communicate across the enterprise)
Reduce product defects and improve standardization

5. Process Ownership
Different employees (stakeholders) have a stake in one or more processes
There should be one individual or group who is responsible for a process (process owner)
The process owner should be responsible for the improvement of the owned process and have the authority to change it
(responsibility == authority)

6. Process Improvement (Introduction)
It’s about making processes better
It’s not about fighting fires
It’s not about blaming someone for inadequate existing processes
It’s a problem solving approach (there are various approaches) to fix what’s broken

7. Process Improvement (Goals - 1)
Reduce variation
Perform the process the same way every time
Remove activities that contribute no value
Improve efficiency
Improve customer satisfaction
Improve effectiveness

8. Process Improvement (Goals - 2)
Eliminate waste of money, people, materials, time
Improve safety and ergonomics

9. Common Process Improvement Questions
What processes should be improved?
What resources are needed to improve those processes?
How can we understand those existing processes we are trying to improve?
How can the improved process be institutionalized?

10. General Process Improvement (Steps)
Balanced Scorecard
The following are summarized from the document
A bit dated but the information holds true today

11. General Process Improvement (Steps)
Select the process to be improved and how it will be improved
Clear metrics should be defined
These metrics are often customer-centric
It’s best to start small and define clear process boundaries

12. General Process Improvement (Steps)
Pareto charts or diagrams are a form of bar graph and line chart with which to analyze frequency of problems or causes in a process
The Pareto principle states that “for many events, roughly 80% of the effects come from 20% of the causes

13. General Process Improvement (Steps)

14. General Process Improvement (Steps)
Example
Simplify a process by eliminating or simplifying steps
Removing an unnecessary form or paper
Quantify expected labor and paper savings

15. General Process Improvement (Steps)
Define the team that will improve the process
It’s important to select the right people who have time
The team should have a clear level of authority and a team leader
Consider team size
Larger teams (8-10) tend to have difficulty reaching consensus and achieving objectives
Define resources needed by the team

16. General Process Improvement (Steps)
Fully define the existing process
Reverse engineer the process using a tool such as BPMN
The team should be clear that the flowchart is accurate
Beware of cross-functional processes

17. General Process Improvement (Steps)
Define the simplified process
Remove redundant or unnecessary activities

18. General Process Improvement (Steps)
Collect baseline data on the existing process
Time to execute the process
Amount of material waste
Use this data to judge efficacy of the improved process

19. General Process Improvement (Steps)
Assess process stability
Does the process have exceptions?
What are those exceptions?
A run chart is a line plotted over time
A control chart is a graph used to study how a process changes over time
Used to look at process variation

20. Control Chart (Example)
Shows max, min, mean, and goal values over time

21. Control Chart (Outcomes)
Look at the root causes of variation and try to remove it
Was the root cause temporary in nature?
Was the root cause a one-time event such as extraordinary weather

22. General Process Improvement (Steps)
We do this after the process is “stabilized”
Is the process capable?
Are there unusual patterns in the data?
Can the process be further improved?
Are the data points within the specification limits
If not, the process is not capable
Look at ways to remove process exceptions

23. General Process Improvement (Steps)
If necessary, identify root causes of why a process is not stable and capable
Change process redesign, as necessary
This can be iterative

24. General Process Improvement (Steps)
Plan and implement the process change

25. General Process Improvement (Steps)
Collect new performance data and compare with baseline data
Did the process improve as expected?
Did we improve process stability (exceptions)?
Did we improve process capability (efficiency)?
Do the data collection metrics need to be changed?
Assess feasibility of further improvements

26. General Process Improvement (Steps)

27. CMMI (Introduction)
The Capability Maturity Model Integration approach is a way of assessing the strengths and weaknesses of existing processes for the purpose of improving them
It’s a set of best practices (framework) to improving processes
It’s a way of getting your customers what they want

28. CMMI (Introduction)
CMMI is a model for improving processes but is not a process itself
It’s managed by the CMMI institute at cmmiinstitute.com
It’s origins are in
Industry
Government
Academia

29. CMMI (History)

30. CMMI (Process Capability Levels)
CMMI defines capability levels and maturity levels – as the name implies
Capability
Level 0: process is not performed or partially performed
Level 1: process is performed
Level 2: process is managed
Level 3: process is fully standardized and documented (defined)

31. CMMI (Process Maturity Levels)
Level 1 – Initial
Processes are ad hoc and chaotic
Characterized by a tendency to overcommit
Level 2 – Managed
Business understands its processes
Processes are periodically monitored
Level 3 – Defined
Processes are well-characterized and understood and improve over time

32. CMMI (Process Maturity Levels)
Level 4 – Quantitatively managed
Quantitative objectives (metrics)are established for quality and process performance
Process performance is predictable
Level 5 – Optimizing
Characterized by continuous improvement based on quantitative metrics

33. CMMI Taxonomy CMMI calls them constellations
CMMI for Acquisition
CMMI for Development
CMMI for Service
Plus the People Capability Maturity Model (People CMM) to help manage workforce

34. CMMI Process Areas Solutions are organized process areas (types)
16 core processes
And specialized processes for
Acquisition of software and hardware
Development of software and hardware
Services

35. CMMI Process Areas (Core)
(I HAVE NOT LISTED THEM ALL)
Configuration Management (CM) (software)
Maintain the integrity of work products using configuration identification, configuration control, configuration status accounting, and configuration audits
Version control, document control, build management, release control

36. CMMI Process Areas (Core)
Integrated Project Management (IPM)
Produce and maintain the project planning
Project monitoring and control
Quantitative project management
Percentage of defects removed by software testing activities, for example

37. CMMI Process Areas (Core)
Measurement and Analysis (MA)
As mentioned, what we measure is what we get
Typical measurement objectives
Reduce time to delivery
Reduce total lifecycle cost
Deliver specified functionality completely
Improve prior levels of quality
Improve prior customer satisfaction ratings
Maintain and improve the acquirer/supplier relationships

38. CMMI Process Areas (Core)
Organizational process definition (OPD)
Responsible for software quality assurance (SQA)
A number of SDLCs (waterfall, agile, scrum, for example)
Organizational performance management (OPM)
At CMMI level 5
Organizational Training (OT)
Organizational Process Focus (OPF)

39. CMMI Process Areas (Core)
Process and Product Quality Assurance
Object evaluation processes, work products and services
Evaluation reports
Noncompliance reports
Corrective actions
Establish records
Evaluation logs, QA reports, reports of quality trends

40. CMMI Process Areas (Core)
Requirements management (for projects)
Managing all changes to the requirements
Maintaining the relationships among the requirements, the project plans, and the work products
Identifying inconsistencies among the requirements, the project plans, and the work products
Taking corrective action
Risk management

41. CMMI Process Areas (Acquisition)
Acquisition Requirements Development (ARD)
Solicitation and Supplier Agreement Development (SSAD)
Agreement Management (AM)
Acquisition Technical Management (ATM)
Acquisition Verification (AVER)
Acquisition Validation (AVAL)

42. CMMI Process Areas (Development)
Product integration
Technical solutions

43. CMMI Process Areas (Services)
Incident prevention and resolution
Service continuity and delivery
Service transition
Strategic service management

44. Six Sigma (Introduction)
Using standard measurement techniques (statistical techniques) to measure operational performance
Motorola (Engineer Bill Smith was given credit for it in 1984)
Further developed at Texas Instruments
Adopted by General Electric, in 1995
A central focus of GE’s business

45. Six Sigma (Objectives)
Improve quality of process outputs by identifying and removing errors (defects)
Minimize variability in business processes and manufacturing
Uses a set of quality management methods (statistical) and create method experts

46. Six Sigma (Methodology)
3.4 defects per million opportunities
There is a methodology to again this goal
Define, Measure, Analyze, Improve, Control (DMAIC)
Defects per million opportunities (DPMO)

47. Six Sigma (Example)

48. Six Sigma (Features)
Focus on measureable and quantifiable financial returns
Emphasis on strong leadership and passionate management
Special infrastructure
Master black belt, black belt, green belt, red belt
Decision-making based on verifiable data
No assumptions or guesswork

49. Six Sigma (Methodologies)
DMAIC (duh-may-ick)
Use to improve existing business processes
DMADV (duh-mad-vee)
Use to create new product or process designs

50. Six Sigma (DMAIC) Define the problem
Measure key aspects of the process and collect relevant data
Analysis the data
Understand cause-and-effect relationships
Improve or optimize the current process
Control deviations

51. Six Sigma (DMADV) Define design goals
Measure characteristics critical to quality
Analyze and develop design alternatives
Design details and optimize the design
Verify the design
Set up pilot runs
Implement the production process

52. ISO 9001 A set of process and quality management standards
A good overview

54. ISO 9000 Principles Customer focus Leadership Involvement of people
Process approach
System approach to management
Continual improvement
Quantitative (factual) approach to decision making