System Improvement Plan

System Improvement Build Process

2 Year High-Level Plan

  1. Phase 1
  2. Management Commitment. Benefit: Executive Buy-In and Commitment – Week 1
  3. Start a Business Office of Operational Excellence.
  4. Meanwhile, start the build of your System Guiding Principles. This includes goals, and responsibilities designed to create an agile and robust company, if not currently existing.
  5. Educate the Management Team on the System Improvement Process.
  6. Phase 2
  7. Staffing. Benefit: Staffing Initiated, Project Selection, and Success Metric Agreement – Week 2 – 4
  8. Start the project off by bringing in 3 Black and 2 Green Belts. Start this early because this will take time and is a Critical Success Factor. Each Black Belt averages $1 million of cost savings.
  9. Start of Project Charter Build. This provides much-needed direction and project management guidance.
  10. Select Improvement projects: (Your System is comprised of Value Streams and Overhead functions). Map Value Streams on critical business systems and poor-performing business systems.
  11. SDD – Standardize, Document, and Display.
  12. Investigate Production Leveling Options. This smooths processes.
  13. Identify areas of Flow. The ideal process to process transfer method.
  14. Find ripe areas to implement Pull.
  15. Evaluate andon as an option. andon means that you stop to fix a defect when detected. Toyota still averages 800 a year. This helps create a learning organization.
  16. Initiate Build of Continuous Improvement Program Utilizing 1 Black Belt.
  17. Establish the Metrics that demonstrate System Success.
  18. Educate on important Lean Six Sigma tools.
  19. Phase 3
  20. Final Pre-Work. Benefit: Stage Set, Ownership Established – Week 5
  21. Educate employees on Waste, or activities a customer would not willingly pay for. Use the Lean Six Sigma acronym DOWNTIMES. Setup an internal web page. *** 87 documented Wastes ***
  22. Select Value Stream Managers. It’s essential to future improvement that Value Streams have ownership. A Value Stream Manager would have additional time to perform other job functions such as managing other Value Streams or operational responsibility. Initiate Monthly Reporting.
  23. Above all, Map and Improve the performance of each Value Stream (VS). VS’s, as an example, include every process between customer order and customer delivery. VS performance is important, Process performance may not be. VS’s move your business to create a focal point on Value Delivery. A Value Stream gives businesses:
    • – Profound Knowledge of Value Stream processes,
    • – Built-in performance metrics,
    • – Value Stream velocity improvement,
    • – Decreased Value Stream cost, and
    • – Increased Value Stream output quality.
  24. Phase 4
  25. Supply Chain. Benefit: Lower Acquisition Prices – Week 13
  26. Align your Supply Chain into 6 tiers of partners.
    1. Tier 1: Critical and Just-in-Time,
    2. Tier 2: Critical and Just-in-Time possible,
    3. Tier 3: Critical but no Just-in-Time,
    4. Tier 4: Other suppliers that deliver Just-in-Time,
    5. Tier 5: Other suppliers Just-in-Time Possible, and
    6. Tier 6: Other non-critical suppliers.
  27. Explore enhanced relationships with Tier 1.
  28. Determine which Tier 2 Suppliers could move to Just-in-Time
  29. Document and Promote the successes of targeting Value delivered and building project inertia.
  30. In addition, initiate an Education and Instruction Program to increase improvement velocity.
  31. Estimated Progress Milestone: At the end of the first quarter you will have put in place all the parts needed to optimize the implementation of your Production System. About 6 Value Streams are Mapped and Improved. The next steps accelerate your march forward.
  32. Subsequently Phase n: Future Steps Towards Your Production System
  33. (Optional, based on aggressiveness) Hire additional Black and Green Belts. This will ramp up the improvement effort through your company.
  34. Select additional critical Value Streams to Map, and so on throughout the whole company. The company now has a focal point on the value it creates for customers.

Estimated Progress Milestones:

At the rate of 5 Values Streams Mapped and Improved every 4 weeks you will have:

  • First Quarter: 9 Value Streams
  • Second Quarter: 24 Value Streams
  • Third Quarter: 39 Value Streams
  • Fourth Quarter: 54 Value Streams
  • Second Year: 114 Value Streams (or more if you continue to staff up)

Benefits of your new System:

  • Profound Knowledge of your Production System
  • Operational Excellence (a competitive advantage)
  • Increased Value Stream velocity
  • Decreased costs
  • Improved product/service quality
  • Above all, Continued Improvement with a quest for Perfection

In Conclusion

This is a big effort, but measurable benefits start within the second month. This effort will move your business to constantly change, create an improvement culture, and comes with Performance Metrics. Your business is now on its way to excellence.