INSEAD Library

Includes bibliographical references and index

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Lean Six Sigma for Service How to Use Lean Speed and Six Sigma Quality to Improve Services and Transactions Contents Acknowledgments.................................................................. vii Introduction......................................................................... ix PART I Using Lean Six Sigma for Strategic Advantage in Service Chapter 1 The ROI of Lean Six Sigma for Services..............3 What Does Lean Six Sigma Mean for Services?...................................... 6 Applying Lean Six Sigma to Services................................................... 8 Why Services Are Full of Waste--and Ripe for Lean Six Sigma........ 12 The Strategic Imperative of Investing in Lean Six Sigma........................13 Revenue Growth Drives Shareholder Value....................................... 16 Conclusion.............................................................................................. 17 Chapter 2 Getting Faster to Get Better (Why You Need Both Lean and Six Sigma)......................... 19 Defect-free Service: What Six Sigma has to offer................................... 21 Speed and Low Cost: What Lean can contribute....................................... 24 A Lean Primer......................................................................................... 26 Basic Lean Lessons................................................................................ 28 Service Example of "Hard" Lean Tools................................................... 42 Why Does Lean Need Six Sigma?.......................................................... 46 Why Does Six Sigma Need Lean?.......................................................... 50 Blending Lean and Six Sigma to Optimize Service................................. 54 Success Story #1 Lockheed Martin .................................... 57 Chapter 3 Seeing Services Through Your Customers' Eyes................................................................................................. 69 VOC Use #1: Strategic business decisions.............................................70 VOC Use #2: Product/service evaluation and design............................. 73 VOC Use #3: Process improvement and problem-solving...................... 80 VOC Use #4: Shaping job descriptions and skill sets around customer needs........................................................................80 Conclusion.............................................................................................. 82 Success Story #2 Bank One.................................................. 85 Chapter 4 Executing Corporate Strategy with Lean Six Sigma............................................................ 101 Applying Value-Based Management to Project Selection..................... 102 Stage 1: Identifying the Burning Platform of shareholder value creation ...................................................................................... 103 Stage 2: Mapping the value streams ................................................... 106 Stage 3: Prioritizing projects (finding the Time Traps) ........................ 111 Value Creation Through Acquisitions and Divestitures......................... 128 Conclusion........................................................................................... 131 Success Story #3 City of Fort Wayne, Indiana ................ 133 Chapter 5 The Value in Conquering Complexity............... 143 Face-to-Face with the Cost of Complexity........................................... 145 The Forces Driving Increased Service/Product Complexity ................ 151 Strategies for Reducing Complexity..................................................... 156 Calculating the Cost of Complexity....................................................... 164 Conclusion............................................................................................ 167 Success Story #4 Stanford Hospital and Clinics............... 169 Part II Deploying Lean Six Sigma in Service Organizations Introduction...................................................................... 181 Chapter 6 Phase 1: Readiness Assessment....................... 185 Readiness Step 1: Select the Champion.............................................. 187 Readiness Step 2: Establish a baseline snapshot ............................... 189 Readiness Step 3: Interviews with top management............................189 Readiness Step 4: Engaging key influencers....................................... 190 Readiness Step 5: Assessing the impact ............................................ 192 Conclusion........................................................................................... 196 Chapter 7 Phase 2: Engagement (Creating Pull) .. 197 Examples of Engagement Strategies................................................... 200 Education, Communication, and Involvement...................................... 202 Rules of Engagement........................................................................... 203 Conclusion: Starting off on the right foot.............................................. 207 Chapter 8 Phase 3: Mobilization......................................... 209 Mobilization Goal #1: Commission an executive team......................... 210 Mobilization Goal #2: Create the infrastructure.................................... 213 Mobilization Goal #3: Develop training................................................. 231 Mobilization Goal #4: Select and charter first-wave projects................ 234 Mobilization Goal #5: Reach consensus on common metrics.............. 235 Conclusion........................................................................................... 237 Chapter 9 Phase 4: Performance and Control....................... 239 Planning Ahead.................................................................................... 239 Avoiding the Pitfalls in Lean Six Sigma Deployment............................ 242 Vigilance: Warning signals and decelerators....................................... 247 Conclusion: Achieving transformational change...................................250 Part III Improving Services Chapter 10 Service Process Challenges............................. 255 Process Challenges in Service.............................................................255 The Biggest Challenge in Service: Learning to recognize waste ........ 259 Running Projects in a Service Environment......................................... 262 Conclusion........................................................................................... 272 Chapter 11 Using DMAIC to Improve Service Processes................................................................... 273 Project Chartering: The transition into Define...................................... 273 Basic Elements of Define..................................................................... 275 Basic Elements of Measure.................................................................. 281 Basic Elements of Analyze................................................................... 289 Basic Elements of Improve................................................................... 292 Basic Elements of Control.................................................................... 303 Improving Your Improvements............................................................. 308 Conclusion............................................................................................ 310 Chapter 12 First Wave Service Projects............................ 311 Case #1: Understanding the process................................................... 313 Case #2: Blaming the visible part of the process..................................318 Case #3: Turning a customer hassle into a delighter........................... 323 Case #4: Getting rid of backlog............................................................ 328 Case #5: It's not just WIP piling up....................................................... 332 Lessons We Can Learn........................................................................ 334 Chapter 13 Raising the Stakes in Service Process Improvement.................................................................. 335 Case #6: Gaining control over process complexity [a service Kaizen project]................................................................. 337 Case #7: Collaborating with internal customers................................... 342 Case #8: Improving response time on signature services.................... 346 Case #9: Cleaning up your workspace (a 5S+ 1 project)..................... 350 Case #10: Knowing what's here (and where it is).................................353 Case #11: Changing professional practice........................................... 358 Case #12: Developing supplier relationships through Lean Six Sigma............................................................................... 358 Lessons We Can Learn........................................................................ 360 Chapter 14 Designing World-Class Services (Design for Lean Six Sigma).............................................. 361 Designing Services with DMEDI .......................................................... 362 Define................................................................................................... 364 Measure............................................................................................... 366 Explore................................................................................................. 372 Develop................................................................................................ 376 Implement.............................................................................................379 Conclusion............................................................................................ 379 Index............................................................................................ 381