Lean Six Sigma Program
Status Report
Sector Meetings
October / November 2005
Draft – for discussion purposes only
Process & Quality Mgmt. Vision
¾ Position Lean Six Sigma as a tool to provide
NYISO staff with the know-how to execute
Excellence in Execution program
9 Lean: Reduce complexity & cycle time
9 Six Sigma: Reduce process defects and variation
¾ Define performance measurement system
¾ Communicate quality awareness and process
improvement across the organization and to our
Customers
¾ Balance product and process improvement
projects while maintaining momentum on both
(prioritization tool)
2
Project Selection Process
¾ Implementation use of a structured approach to:
9 Identify opportunities - Project Ideas
9 Prioritize projects
9 Select projects to execute
9 Manage the number of projects in process
¾ Disciplined management of the active project
pipeline – launch projects based on availability
of resources and data
¾ Clear, consistent use of project evaluation
criteria related to driving value
3
1
Project Selection Process
Identify Value
Levers
2
Identify
Project Ideas
3
Screen Initial
List of Project
Ideas
4
GreenBelt:
Champion:
Process Own
er:
SME:
TeamMembers:
Master BlackBelt:
Financial Rep:
DataSources
Defect:
Baseline:
Entitlement:
Goal:
Initial DPMO:
Realized DPM
O:
Initial Sigma:
Realized Sigma:
StartingDate:
DataOwners
• Strategic
ƒ Translate
Opportunity Areas
into Project Ideas
• Operational (Process)
• Financial
• Customer
ƒ Prioritize value levers
ƒ Fill in Benefit / Effort
Matrix
ƒ Review plotted
results
ƒ Select highest
priority opportunities
for further analysis
PRIORITIZATION CRITERIA
#
Criteria
Weight
HIGH
10
MEDIUM
7
LOW
NONE
3
0
1
Quality: Defect
Reduction
10
Required by Regulation, Desired b
Customer
Required by Regulation
Desired by Customer
Not Required by Regulation & No
Desired by Customer
2
Delivery: Cycle
Time Reduction
7
Desired by Customer and NYISO
Desired by Customer
Desired by NYISO
Not Desired by Customer &
Not Desired by NYISO
3
Price: Cost
Reduction
9
$100,000 - $50,000
$50,000-$10,000
0 - $10,000
4
VOC: Customer
Impact
5
Major Visible Impact
Minor Impact
No Impact
5
Reliability
5
Affects NYCA Mission-critical syste
non operational
6
Market
7
7
Reputation
9
Above $100,000
Above $1 million impact
Major Impact or Minor Visible Impact
Affects Zones outside J & K Non
Local Reliability - Non mission-critic
mission-critical systems non
systems affected
operational
$100,000 - $1 million impact
None
$1 - $ 100,000 impact
$0 impact
NYISO fails to meet regulatory Continuous mistakes in processes t
Small process/procedural errors
compliance issues, execution caus
affect stakeholders and indicate
impact limited stakeholder segmen
NYISO inability to correct
marked disruptions.
9
Complexity
7
10
Data Availability
10
One area
12
Time Frame
5
Less than 5 months
13
Project
Resources
6
Readily available - Top Priority
Cross-functional < 3 Areas
None
Highly Cross-functional/ Reengineering
N/A
More than 40 data points per month More than 20 data points per monthFewer than 20 data points per mont Fewer than 20 data points per mont
at least 6 months of data
at least 3 months of data
3 months of data
less than 3 months of data
5-9 months
Available - Not Top Priority
9-15 months
Minimal Availability or Low Priority
Greater than 15 months
Not Available
# of calls to Customer Relations
# of esc
alatedcalls each mon
th to Customer Relationssupervisor
Unit cost / call
N/A
ICOPQ(Define/Measure):
COPQ (Analyze):
Pre-ImplementationCBA Im
( prove):
Post-ImplementationCBA(Control):
Realization(12months):
Cost of Implementation
ƒ Score each project
idea as High / Med /
Low for Benefit and
Effort
Mr. Data Owne
r1
Mr. Data Owne
r2
Reduceincomingcall volume at Customer Relations
Bid to Billprocess
Incoming call volume to Customer Relationsincreasedby35%over
thepast 12months fromJanua
ry thru December causinganadditional
operatingexpensefor thefirmof $41,000
.
Anyincomingcall fromMarket Participants dueto billingerrors
1204calls /month
776calls / month
Reducecall volume by 25%(70% of Entitlement) from 1204downto
904calls / month
285
91
4.95
5.21
th
January 20
, 2004
Primary Metric:
Seconda
ry Metric:
Financial Metric:
Consequen
tial Metric:
ƒ Translate Value
Levers into
Opportunity Areas
Prioritize List of
Defined Projects
Jackie Cazar
FrankDeno
ElaineBell
Wayn
e Bailey
Member1,Member 2, Me
mber 3
Keith Richards
Marcella Baum
Call Volume Report
Phonesystemstatistics
Project Name:
Process:
Problem
Statement:
ƒ Identify value levers
in the business
5
Scope and
Define
Projects
41,400
71,000
90,442
92,271
0
ƒ Assign opportunities ƒ Evaluate projects
to project Champions
using Evaluation
for project definition
Criteria
ƒ Complete Draft
Project Charters
ƒ Update Benefit /
Effort Matrix
ƒ Review plotted
results
ƒ Prioritize projects
ƒ Schedule project
launches based on
4
resource availability
DMAIC Project Phases
5
Lean Six Sigma Project Tollgates
¾ Tollgates are events that the project must pass
at each phase of the project (D-M-A-I-C).
¾ Formal presentations contain the following:
9 Project status report
9 Review of activities and accomplishments
9 Review of Project Charter assumptions
¾ The tollgate review ends with a Go/No-Go
decision to move project to next DMAIC phase
9 If No-Go decision, further actions need to be defined
in order to pass the tollgate OR kill the project
6
Current Program Status
¾ Teams identified for sixteen (16) LSS projects
9 Six (6) projects targeted at price correction processes
¾ First round of Green Belt training complete
¾ Formal project kick-offs conducted for each
project
9 Currently all projects are in Define phase
¾ Project Champions and Sponsors meet weekly
to review status of projects and program
progress
7
Active LSS Projects
Reduce RTD Data Input Errors
Improve 1st Tier MP Issues Resolution
Reduce Incorrect RTS Operational
Parameters
Improve 2nd Tier MP Issue Resolution
Reduce RTS Price Posting Failures
Reduce Settlement Challenge Cycle Time
Reduce Emergency Software Changes
Improve Billing Issue Resolution Process
Reduce RTS Software Errors in Testing
Reduce Current Data Billing Issues
Reduce Software Defect Rate in
Development
Reduce Price Posting Cycle Time
Improve Metering Data Accuracy
Reduce Fuel Price Indexing Cycle Time
Improve Data Posting
Reduce Ratio of Hours with Price
Reservations
8