HPS Leadership Best Practices Journal™

BPI-6 Sigma: An Overview of Business Process Improvement

6 Sigma, Business Process Improvement (BPI), Total Quality Management (TQM), Continuous Improvement (CI), and Continuous Quality Improvement (CQI) are a few of the historical methodologies that drive the Customer Experience. An underlying and common foundation for these methodologies is the empowerment of the employee to identify business issues and drive toward solutions or improvement. BPI provides a systematic and disciplined approach to reducing the defects that occur as a result of processes that have wide variability in the tasks being performed.

This article will present a high-level overview of the BPI methodology and is not intended to provide a working knowledge of performing BPI.

Since the literature already abounds with examples regarding the historical success of 6 Sigma and BPI in companies such as Motorola, GE, and Westinghouse, to name a few, I do not plan to rehash these experiences. I have included a list of references at the end of this article (increasing order of BPI detail and complexity) relating to 6 Sigma and BPI that I have found interesting and helpful in performing BPI.

An effective BPI program should reflect a long-term commitment by the company and must be integrated into its strategic goal and mission statements. This requires vertical support and an understanding of the corporate commitment. The BPI methodology should reflect the company's business model, thus being integrated into the daily operations and culture. BPI can die a slow death if isolated as a function or activity. An organization within the company that develops the training and infrastructure supporting BPI may yield the greatest benefits. BPI becomes a corporate common language and provides a systematic approach to determining the root cause of identified issues regardless of where the issue is identified. This allows corporate leveraging of results.

Many of the techniques used come from previously existing methodologies mentioned. Consequently, BPI has a long historical basis for its documented success. On the average, operational savings of 3% relative to the revenue are typical. It may be easier to expand the bottom line from BPI operational savings than to increase market penetration. Experience demonstrates benefits not only in manufacturing but in all corporate functions/activities where repetitive processes are ongoing.

Most BPI projects follow this general flow:

• Phase 1 (DEFINE)
  • Identify a process issue.
  • Determine whether the issue is a valid candidate for BPI.
  • Establish the project team most familiar with the process issue and best trained in BPI to drive improvements.
  • Formally document the project's goals, its objectives, ROI, etc. (This may be in the form of a contract: management agrees a valid BPI issue may exist and supports the team in their activities).
  • Develop an "AS IS" process map/flowchart of the activities/tasks currently performed to clearly reveal the existing process from which the business or operational issue emanates.
    
    
• Phase 2 (MEASURE)
  • Collect baseline performance data (metrics reflecting critical to quality characteristics) of the process activities.
  • Ensure that data is consistently defined and normalized for comparability and accuracy.
    
    
• Phase 3 (ANALYZE)
  • Using "Quality Tools," analyze the process dynamics and/or data (metrics) obtained from the process as defined within the "AS IS" process map. (Specific Quality Tools will be discussed in future articles.)
    
    
• Phase 4 (IMPROVE)
  • Based upon the findings from Phase 3, modify/enhance the "AS IS" process that will improve the customer experience: better quality, more cost-effective manufacturing/distribution, reduced cycle time, increased productivity.
    
    
• Phase 5 (CONTROL)
  • Putting into place ongoing measures and activities that will sustain the improvements implemented. Change is sometimes difficult to maintain. We are creatures of old habit. This frequently occurs when the company is trying to maintain or push the numbers around end of quarter or fiscal year.
    
    
• Phase 6 (DOCUMENT)
  • Documenting with a standard format the project's progress, completion, and output metrics provides best practice experience that can be leveraged within the company.

Company

• Decide whether to test the waters with BPI or jump in — contracting with a consultant or hiring an individual with BPI/6 Sigma experience, respectively.
• Commit to developing an infrastructure that drives quality and the customer experience within the company.
• Develop and implement a BPI training program. Various degrees of BPI training reflective of the different needs of the employee on projects of varying complexity.
• Decide whether BPI training will be provided within a strata of the company's employees (mid-management or higher) or vertically available to all employees with identifiable need and supervisor approval.
• Determine a BPI methodology structure that best fits the company's business model . Design, develop, and implement this model.
• Have performance measures (metrics) that are definable, measurable, and relative to the process task(s) in place.
• Expose supervisors and managers to the BPI methodology. They must understand their role in supporting BPI projects. This training may not be the same level of detail as those who will be doing the BPI projects.
• Integrate the BPI philosophy into the corporate strategic goals statement.
• Recognize team members upon completion of the project.
• Provide an initial review process that determines which business issues are good BPI project candidates.
• Financial analyst most familiar with the project's area determines the validated savings/improvements.
• Put into place a project database. This enhances "best lesson learned."
• Provide adequate training facility support.
• Ensure that project savings/improvements are valid.

Employee

• Attends BPI training with approval by manager. Attendees should be on or be scheduled for a project. This provides maximum benefits to the employee and company.
• Receives recognition with certification upon completion of training and successful BPI project completion. Different types of certification might be appropriate to best reflect the level of training received and the project complexity.
• Project leader has experience with BPI methodology and previous project experience.

The next series of articles will explore each phase of the model, how the phases flow, and the quality tools typically used in each phase.

References

Peter S. Pande, Robert P. Neuman, Roland R. Cavanagh. The Six Sigma Way, McGraw-Hill Inc., 2000, ISBN 0-07-135806-4.

Mikel Harry, Ph.D and Richard Schroeder. Six Sigma, Doubleday, 2000, ISBN 0-385-49437-8.

Peter Mears, Ph.D. Quality Improvement Tools & Techniques, McGraw-Hill, Inc., 1995, ISBN 0-07-041219-7.

H.James Harrington. Business Process Improvement, McGraw-Hill, Inc., 1991, ISBN 0-07-026768-5.

Forrest W. Breyfogle III. Implementing Six Sigma, John Wiley & Sons, Inc., 1999, ISBN 0-471-29659-7.