Managing Process Excellence at Your Location
Driving A Continuous Improvement Culture
Sponsor Workshop
Process Excellence
Objectives
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Spark ideas for project opportunity (discussion)
Review Elements of Project Chartering
Discuss L6S Roles and Responsibilities
Explore a 6-step model for Leading Change
2
There Really is Another Way
Here is Edward Bear, coming
downstairs now, bump, bump,
bump, on the back of his head,
behind Christopher Robin.
It is, as far as he knows, the only
way of coming downstairs, but
sometimes he feels that there
really is another way, if only he
could stop bumping for a moment
and think of it.
- From A.A. Milne’s Winnie the Pooh
3
Purpose of Improving
• To make the operation safe(r)
• To eliminate variation in quality and speed
• To improve process flow and speed
Safer, Better, Faster
4
Plan for Improving
Organizations must develop a process to define
strategic focus area and then effectively scope
them into manageable DMAIC improvement
projects.
• If a continuous improvement process is not
identified and firmly established within the
organization and project selection is left to team
leaders :
- The overall CI effort risks loosing effectiveness
- Projects may become isolated endeavors
- Change may be small and distributed
•
Continuous Improvement Process (Lifecycle)
1. Project Identification
Inputs:
• Business Strategy
• Financial Analysis
• Value Stream Analysis
• Customer Satisfaction
•
•
•
•
Safety Issues
Financial Woes
Inefficiencies
Employee Ideas
Long-List of
Long-List
Ideas
Potential
CI of
Projects
Generation of
Improvement
Ideas
5. Project &
Program Reporting
2. Project Vetting
Define &
Prioritize Project
Charters
4. Project Execution
3. Project Resourcing
D
C
M
I
A
Sustainment
(Leading Change)
6
Real Need to Improve
Ask Questions
• How do you know you have a problem?
• Where do you look?
• How do you know what you are doing now could
be improved?
Let’s examine the workings and components of a marine
terminal with an “eye for improvement” around common
themes of waste reduction and variation reduction... There
are lot’s of areas presented to spark ideas!
(NOTE: Some may not apply to your particular situation.)
1. Project Identification
• Examine your operation.
• Spark an Idea for Improvement!
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Operational Capacity
• Berth and
Cranes
• Container
Yard
• Gate
• Rail Yard
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Berth and Cranes
• Primary Drivers:
– Lifts per vessel call
– Crane availability
– Crane splits
– Crane productivity
– Operating Hours
• Secondary Drivers:
– Lost hours
– Unproductive lifts
– Twin/dual lifts
– Double cycling
10
Container Yard
• Primary Drivers:
– Dwell time
– Slot density
– Stack height
– Utilization and productivity
• Secondary Drivers:
– Stack equipment
– “Hit rate”
– Storage organization
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Gate
• Security
– Driver ID, booking/DO checking,
equipment verification
– TWIC
• Data acquisition
– Numbers, weight, condition, seals
– Truck regulatory status
• Transaction management
– Storage management, equipment
assignment, routing instructions
12
Gate (Continued)
• Primary Drivers:
– Flow pattern
– Services provided
– Processing rate
– Operating hours
– Data acquisition capabilities
• Secondary Drivers:
– Truck driver quality
– Truck data integration
13
Rail Yard
• Primary Drivers:
– Train schedule & switching
– Lift rates
– Operating hours
– Inspection / pretrip
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Container Yard Systems
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Wheeled
Side Picks
Top Picks & Reach Stackers
RTGs, RMGs & Bridge Cranes
Straddle Carriers
ASCs & AGVs
Automated Strads
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Container Yard + Cranes
• Storage slots
• Circulation area
• Lighting, fire
suppression
• Grading, paving,
runways
• Yard cranes - a
variety…
16
On-Dock Intermodal Yard
• Arrival / departure tracks for train assembly and
disassembly
• Storage tracks for empty cars
• Working tracks for loading and discharge
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Side Picks
• No selectivity
• Empty containers only
• High land utilization at
low cost for zero value
• Up to seven high, 400600 TEUs per net CY acre
• One machine can
generally deliver or
receive 35 to 38 boxes
per hour
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Straddle Carriers
• Any top box
• Loads or empties
• High transport productivity,
modest land utilization
• Up to four containers high
• 200-300 TEUs per net CY
acre
• Combining travel and
handling, one machine can
typically do 8 to 10
cycles/hour, depending on
travel distance
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Data Acquisition
• Digital imagery
• Optical Character
Recognition (OCR)
• Biometrics
– TWIC System
• Electronic Data Interchange
– EDI, EDIFACT
• Automatic Equipment
Identification (AEI)
• Equipment Positioning
System (EPS, inventory
control)
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Data Flow
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Mobile Data Terminals
In-cab Inventory Displays & Operating Instructions
Remote Control
Automation Data
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Signs of Trouble
• Scrap, Damage & Rework is too high
• Accounts receivable, past due & increasing
• We have a new service/ technology (developed for one
application) and want to utilize it with others
• Can’t meet schedule/on-time delivery goal
• Customer changed requirements for our service/ product
• Operational costs increasing for one of our services/
products
• We go through all this effort to come up with the right
estimate and they’re always rejected, so we do it over
• Are our metrics telling us we’re improving? But…
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Upside
• Improvement efforts can help:
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–
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Improve safety
Increase customer satisfaction
Reduce costs
Enhance delivery time
Get rid of waste in a process
Make work more meaningful
Make work easier
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Project Type
Generally speaking, there are 4 “types” to consider:
1. Re-designing or defining a process
example: putting a new process in place, (new traffic pattern)
2. Waste reduction
example: second or third container move
3. Variation reduction
example: moves per hour, crane bumps
4. Creating a Benchmark
example: establishing a new performance measure
24
Continuous Improvement Process (Lifecycle)
1. Project Identification
Inputs:
• Business Strategy
• Financial Analysis
• Value Stream Analysis
• Customer Satisfaction
•
•
•
•
Safety Issues
Financial Woes
Inefficiencies
Employee Ideas
Long-List of
Long-List
Ideas
Potential
CI of
Projects
Generation of
Improvement
Ideas
5. Project &
Program Reporting
2. Project Vetting
Define &
Prioritize Project
Charters
4. Project Execution
3. Project Resourcing
D
C
M
I
A
Sustainment
(Leading Change)
25
2. Project Vetting
Separate the “vital few”
needs and issues (good ideas)
from the “trivial many”.
Let’s devote our time and
attention to those potential
projects that will have a
probability of success, be an
easier effort to do (and to
manage) and have an greater
impact on the organization.
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Rate and Rank Each Project
The desirability of a project increases as you move from lower
right to upper left, and as circle gets larger.
Probability
of Success
IMPACT
Hi
Low
Med
Med
Hi
Low
Low
Med
EFFORT
Hi
Evaluate each Project Idea to Criteria
Here are three attributes for evaluating a project:
1. Business Impact
2. Effort required
3. Probability of Success
Projects should be meaningful and manageable.
Examples of Little or No Business Impact
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•
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Creating or revising a report
Installing a measurement system
Quantifying the performance of a process
Improving a supplier performance without
arrangement of benefit for the company
• Reducing cycle-time of a non-bottleneck
operation
Effort Required
Definition –
• Project Leader time, also, time required by team
members and any expenditure of money
Typical High effort –
• Installing a new computer system
• Improving profitability of entire work stream or
“fixing” the annual planning process
Definition of Probability of Success
An assessment that takes into account the
various risk factors –
• Time - uncertainty of completion date
• Effort – uncertainty of the investment required
• Implementation – uncertainty of roadblocks
Typical low probability of success –
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Won’t show benefits within a year
Depends upon completion of other projects
Requires help from extremely busy people
Not aligned with company objectives
Project Hopper - Example
B/U
PROJECT
PROJ TYPE
START
DATE
Exotic Auto Discharge
19:00 Ordering Practices
Equipment Innovation
Implementation of Std Work
Fairfield Van Procedure
Improved Ship Planning
Live Scan
Yard Reconfiguration
Non-EDI /Rec’v Process
BMW Export Prod Impr
VW Discharge Analysis
EDI Manifest Imp
Kaizen
Green Belt
Kaizen
Green Belt
Kaizen
Kaizen
Green Belt
Kaizen
Green Belt
Kaizen
Green Belt
Kaizen
8/3/15
7/1/15
3/15/15
2/15/15
2/1/15
1/1/15
1/15/15
3/15/15
10/1/15
8/24/15
8/31/15
10/1/15
$45,000
$178,800
$171,600
$176,900
$52,150
$165,400
$240,000
$54,000
$52,000
$85,000
$110,000
$23,000
Analyze
Control
Control
Control
Control
Control
Control
Control
Measure
Measure
Measure
Measure
M DeMeo
M Bellonis
M Bellonis
M Bellonis
M Bellonis
M Bellonis
M Bellonis
M DeMeo
M Bellonis
M DeMeo
M DeMeo
M DeMeo
SSCO x SSCO Analysis
Green Belt
8/24/15
$260,000
Improve
M DeMeo
Pasha LTR Reduction
Green Belt
9/7/15
$120,000
Define
Toyota Prod Monitoring
Kaizen
9/14/15
$130,000
Define
Tacoma
Equipment Shifting Analysis
Kaizen
10/9/15
$90,000
Measure
SITE
PROJECT
PROJ TYPE
START
DATE
Equipment Allocation
Kaizen
8/10/15
$34,000
Define
M DeMeo
Energy Analysis
Kaizen
8/10/15
$120,000
Measure
M DeMeo
SITE
Baltimore
Bayonne
Auto /RoRo
Charleston
Davisville
Galveston
Jacksonville /
Brunswick
LA NATSS
PNAT
B/U
LA Cruise
Cruise
Manhattan
Cruise
PROJECTED PROJECT
SAVINGS
STATUS
PROJECTE PROJECT
D SAVINGS STATUS
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RESOURCE
M DeMeo /
F Castonguay
M DeMeo
M DeMeo /
F Castonguay
RESOURCE
Continuous Improvement Process (Lifecycle)
1. Project Identification
Inputs:
• Business Strategy
• Financial Analysis
• Value Stream Analysis
• Customer Satisfaction
•
•
•
•
Safety Issues
Financial Woes
Inefficiencies
Employee Ideas
Long-List of
Long-List
Ideas
Potential
CI of
Projects
Generation of
Improvement
Ideas
5. Project &
Program Reporting
2. Project Vetting
Define &
Prioritize Project
Charters
4. Project Execution
3. Project Resourcing
D
C
M
I
A
Sustainment
(Leading Change)
33
3. Project Resourcing
• Formulate your best idea into a Problem Statement
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Project Idea Form
Current Situation:
Problem Statement
Objective:
Reduce/optimize/increase __________________________________________________________ (project y)
from _________________________________________________________________________(current level)
to ____________________________________________________________________________
(target level)
‘S.M.A.R.T.’
for __________________________________________________________________________ (specific area)
while reducing/increasing/holding constant______________________________________( constraining Y’s)
Benefits:
What Value Does It Provide?
Team Members:
Who Should Be Involved?
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Project Idea - Sample Questions
• Has the project been chosen because it is in
alignment with operating goals and the overall
strategic direction of the ‘business’?
• Have other similar projects been completed?
• Are we duplicating projects that have already been
completed?
• Is this project worth doing?
• Is it customer oriented?
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Project Idea - Sample Questions
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Who owns the process?
Is it properly scoped?
What is the probability of success?
What is the team makeup?
What resources are available to the team?
What is the actual process we are improving?
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Project Scope
• What process will the team focus on?
• What are the boundaries of the process?
– Start point
– Stop point
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Is the scope reasonable?
What resources will be available?
What (if any) is out of bounds for the team?
What (if any) constraints must the team work
under?
• What is the time commitment expected?
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Convert Idea to Chartered Project
• Review Elements of Project Chartering
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Provide the Details of Idea on Project Charter
Review Charter with Project Leader.
Describe ideas in terms of a problem
statement.
Situation – What is the current
opportunity?
Objective – How do we measure
success?
Benefits – What value does it provide?
Team Members – Who should be
involved?
Time Frame – How complex is the
project?
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Project Charter – Sample Questions
•
What is the actual problem being addressed?
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Is this an important Customer issue?
•
What data has been collected to understand the
problem?
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What are the business reasons for completing this
project?
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What Breakthrough Objectives will this project
impact? How?
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Project Charter – Sample Questions
•
Where, when, and to what extent does the problem
occur?
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Has another Team tried to solve this or a similar
problem? What can we learn from them?
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What are the boundaries of this project?
•
What is the goal for the project? Is the goal
developed in the “SMART” format?
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How will we know if the team is successful?
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Are key milestones established?
42
Continuous Improvement Process (Lifecycle)
1. Project Identification
Inputs:
• Business Strategy
• Financial Analysis
• Value Stream Analysis
• Customer Satisfaction
•
•
•
•
Safety Issues
Financial Woes
Inefficiencies
Employee Ideas
Long-List of
Long-List
Ideas
Potential
CI of
Projects
Generation of
Improvement
Ideas
5. Project &
Program Reporting
2. Project Vetting
Define &
Prioritize Project
Charters
4. Project Execution
3. Project Resourcing
D
C
M
I
A
Sustainment
(Leading Change)
43
4. Project Execution
Recall the DMAIC methodology:
• Define the scope, problem statement, and opportunity.
• Measure how well process is performing and how it is
measured.
• Analyze data collected on the process/ project area and
determine the key process factors affecting variability.
• Improve the process and test strategies that reduce variation.
• Control processes to ensure continued performance.
Support Network Needed to Assist Project Leader
• DMAIC Execution (Teamwork)
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•
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Complete the Charter
Break Barriers
Select the Team
Sponsor
Review Projects
Meet with Leader
Project
Members
SMEs
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•
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Technical Conscience
Aid in Project Reviews
Mentor Project Leaders
Assist Local Leaders
Process
Improvements
• Identify Opportunities
• Lead Projects
• Monitor Lean Six
Leader
Sigma Metrics
• Agents of Change
Site/ BU
Controller
Process
Owner
• Own the Control Plan
• Own the improvements
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Establish Business Goals
Select Projects
Establish Priorities
Conduct Reviews
Verify Savings
Audit Control Plans
Sponsor Roles & Responsibilities
• Advocates L6S methods within the BU
– Tracks number of Leaders and Projects (Portfolio)
– Develops listing of project ideas
– Develops the charters with Project Leader(s)
• Provides leadership and direction to the Leaders
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Articulates the need for a project
Breaks down organizational barriers
Mentors / coaches project leaders
Stakeholder - key beneficiary of project improvement
Review progress continuously with Project lead
Project Portfolio - Example
Projects -
3
Projects - 21
Projects -
7
Projects -
1
Projects -
8
47
Controller’s Roles & Responsibilities
• The local controller is responsible for approving the
savings claimed on projects
– Be part of the chartering process for prioritization
– Proper categorization as completion year EBITDA impact
or cost avoidance
– At the conclusion of a project, the controller is
responsible for financial approval of the final savings
determination for a local project
– By ‘Approving’ a completed project, the controller is
agreeing that the stated savings are real
Project Leader Roles & Responsibilities
• Leaders of process improvement projects:
(Green Belt, Kaizen, or JDI/ A3 level)
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–
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–
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Work in own functional area
Drive continuous process improvement
Technical process experts
Appliers of the Process Excellence tools
Change Agents
Team Member Role’s & Responsibilities
Cross functional team including:
• Members from the work area (inside eyes)
• Members from outside work area (outside eyes
willing to question non-value added activities)
• Customer (internal/external) voice
• Suppliers/Partners/Safety Representative(s) as
required
50
Process Owner’s Roles & Responsibilities
• Owns the changes to the process after the project
is completed
– Participates as part of the team
– Ensures the change is implemented
– Monitors the control plan and reacts as required to
sustain the gains
Subject Matter Experts
• Experts in Lean Six Sigma Tools and Methodology
– Ensure results achievement/ promotion/ publicity
– Assist in project identification and administration of Lean
Six Sigma initiatives
– Breaks down technical barriers
– Coaches and mentors Leaders during a project
– Continuously improves the developmental process
– Identify, share and deploy Best Practices
– An optional Growth Path for Project leaders
Continuous Improvement Process (Lifecycle)
1. Project Identification
Inputs:
• Business Strategy
• Financial Analysis
• Value Stream Analysis
• Customer Satisfaction
•
•
•
•
Safety Issues
Financial Woes
Inefficiencies
Employee Ideas
Long-List of
Long-List
Ideas
Potential
CI of
Projects
Generation of
Improvement
Ideas
5. Project &
Program Reporting
2. Project Vetting
Define &
Prioritize Project
Charters
4. Project Execution
3. Project Resourcing
D
C
M
I
A
Sustainment
(Leading Change)
53
5. Program Reporting and Sustaining the Gain
“Hard” Savings: Savings that can be measured by a change in the
bottom-line (EBITDA)
$ Spent
“Soft” Savings (Cost Avoidance): Savings that reduce or eliminate
future spending of money without a change to the bottom-line
$ Spent
Costs that
were
avoided
54
Project Reporting - Example
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Sustaining the Gain - What It Takes
Shift in Focus
• Document on how work gets done (steps that
comprise the process)
• Examine the flow of work between people or
work stations/segments/activities
• Give people knowledge and methodologies they
need to improve that work
56
Leading Change
• TEAM = Together Everyone Achieves More!
Effective Approach to Leading Change
1. Establish a Sense of Urgency
2. Create a Support Network
3. Develop & Communicate the Vision
4. Address Resistance
5. Empower Employees
6. Communicate the Wins
Urgency
1. Establish a Sense of Urgency
• A compelling Business Case must be made that this is the right
time to make change
• Need must be greater than resistance
• Status quo can NOT remain acceptable
• Ways to create urgency:
− Set “stretch” goals that force change
− Increase visibility of unhappy customers and poor financial
performance
− Allow a crisis to happen
− Communicate reality
Support
2. Create a Support Network
Myth: You can demand change.
Reality: You need change to become
infectious.
• Find supporters, build supporters and
allow them to help make it part of the
community
• Give the supporters visibility and the
resources to continue to “spread the
word”
Communicate
3. Develop and Communicate the Vision
• Clearly describe the objectives and the
timeline
• Communicate the behaviors, processes
and practices that will be needed
• Be focused yet flexible
• Develop communication strategies for
every position level and situation
• Over-communication is rarely achieved
Find Resistance
4. Address Resistance
• Assess readiness and where each person is in
the change cycle
• Link change back to the business interest and
each person’s personal interest
• Involve any resistors
• Pick up clues as to the form resistance is taking
• Seek to have discussions with any people not on
board, find resistance
• Define training needs tools to address their
concerns
Empower
5. Empower Employees
• Respect the opinion of resistors
– Respect the person
– Maintain their self-esteem
– Remove doubt, fear and misunderstandings
– Authorize people to make mistakes
• Build and maintain involvement
– Establish clear goals
– Offer training
– Provide clear performance feedback
– Recognize effort and contribution
Announce Wins
6. Communicate the Wins
• Select one or more projects to yield
tangible, quick results
• Give visibility to the success through
company project reviews & link
results to corporate objectives
• Reward & recognize the project
team
• Spread enthusiasm for the
accomplishments!
Celebrate Achievement
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•
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Recognition in Team Meetings
Awards presented in Town-hall meetings
Articles and pictures in B.U. Newsletters
Jackets, Plaques, Pins, Legos, etc.
Special Dinners and Luncheons
65
Accomplishment in Newsletter - Example
To ensure change is sustainable - reward and reinforce change
leadership behavioral skills within the team, celebrate
successes across the enterprise, and recognize the valuable
contributions of all team members.
66
Continuous Improvement Process (Lifecycle)
1. Project Identification
Inputs:
• Business Strategy
• Financial Analysis
• Value Stream Analysis
• Customer Satisfaction
•
•
•
•
Safety Issues
Financial Woes
Inefficiencies
Employee Ideas
Long-List of
Long-List
Ideas
Potential
CI of
Projects
Generation of
Improvement
Ideas
5. Project &
Program Reporting
2. Project Vetting
Define &
Prioritize Project
Charters
4. Project Execution
3. Project Resourcing
D
C
M
I
A
Sustainment
(Leading Change)
67
Review
•
•
•
•
Spark ideas for project opportunity discussion
Review Elements of Project Chartering
Discuss L6S Roles and Responsibilities
Explore a 6-step model for Leading Change
68