2. Learning Objectives
• You will learn how to:
– Identify and eliminate the eight wastes as they
exist in office and service processes.
– Use key metrics to improve office and service
processes.
– Create metrics-based process maps to identify
waste, design improved processes and
standardize office and service work.
6. Cultural Differences – Mfg vs. Office
Shop Floor Traits
Office Traits
Sense of urgency
Less urgent
Time scarce resource
Time expands to complete the
task
Production quotas
Excessive work waits
Standard times and methods
Few processing standards
Real time performance
measurements
Few to no real time
measurements
Daily production meetings
Weekly staff meetings
Desire for change
Desire to maintain
20. Eliminating Over-Processing
Future State
Current State
Main
Tech
Main
Tech
ISEA
CRANE
SUPPLY
ISEA
CRANE
SUPPLY
C.O.
C.O.
DAAS
DAAS
DEPT
HEAD
SNAP
ITEM
MGR
STOCK
POINT
DEPT
HEAD
SNAP
STOCK
POINT
SK
SK
BO1
BO1
DOCKSIDE
CRANE
DEPOT
SUPV
PEO
IWS2
Handoffs= 47
Lead Time = 486 hrs (60.7 days)
Process Time = 108 hrs (13.5 days)
SUPV
PEO
IWS2
Handoffs= 10 (78% improvement)
Lead Time = 90 hrs (11.3 days)
Process Time = 58 hrs (7.3 days)
20
46. Narrowing the Scope: Example
Units
Domestic
Consumables
Warranty
Service Parts
Order
Fulfillment
Process
NonWarranty
Units
International
Consumables
Warranty
Service Parts
NonWarranty
47. Current State Value Stream Map
Supplies Purchasing - Current State VSM
Purchasing — Non-repetitive purchases less than $5,000
Inititate Req.
1
Originator
31
PT = 10 mins.
C&A = 10%
Supplies
Hard Copy
Form File
File Maker
Quicken
Vendor
Website
Excel
ERP
Data Entry
Review
Budget
2
Review Req.
Finance
PT = 5 mins.
C&A = 60%
0.25 days
4 hrs.
PT = 5 mins.
C&A = 95%
0.5 days
5 mins.
20 Reqs
Review 4
Requisition
40 hrs.
PT = 5 mins.
C&A = 90%
8 hrs.
PT = 5 mins.
C&A = 100%
1 days
5 mins.
8 hrs.
7
10 Reqs
1
PT = 10 mins.
C&A = 95%
4 hrs.
PT = 15 mins.
C&A = 98%
0.5 days
10 mins.
Approve in
ERP
24 hrs.
PT = 5 mins.
C&A = 90%
3 days
15 mins.
Submit PO
to Supplier
8
63 Reqs
9
10
External
Supplier
Corp Purchasing
Manager
1
Admin Asst
Financial Mgr
1
1 days
5 mins.
Enter
Requisition
Review 6
Requisition
IS Manager
1
1
5 days
5 mins.
Review 5
Requisition
Sys Engineer
Supervisor
2
6
2 hrs.
3
Corp Purchasing
6
56 hrs.
PT = 15 mins.
C&A = 98%
7 days
5 mins.
80 hrs.
PT = 20 mins.
10 days
15 mins.
LT = 28.4 days
PT = 65 mins.
AR = 0.477%
RFPY = 4.2%
Customer Demand:
615 requisitions per y ear
PT = Process Time
LT = Lead Time
C&A = % Complete & Accurate
AR = Activ ity Ratio (PT/LT x 100)
RFPY = Rolled First Pass Y ield
48. Future State Value Stream Map
Supplies Purchasing - Future State VSM
Purchasing — Non-repetitive purchases less than $5,000
Additional
IT access
Enter Req.
in ERP
Integrate Form
File with File
Maker
1
Originator
31
PT=30 mins.
C&A = 85%
Supplies
Requisition
Checklist
Vendor
Websites
File Maker
Cross
Training
Approval
Additional
IT access
2
4 hrs.
6 hrs.
0.75 days
5 mins.
Place
Order
3
4
5
External
Supplier
6
PT=20 mins.
80 hrs.
PT=20 mins.
C&A = 98%
1 days
5 mins.
Dedicated
Buyers
Corp Purchasing
8 hrs.
PT=5 mins.
C&A = 90%
PT=5 mins.
C&A = 95%
0.5 days
Approve
in ERP
Dept.
Manager
1
Supervisor
2
Use budget in place
of Quicken
Auto Notify
Standard
Work for
review
Review
Req.
ERP
10 days
20 mins.
LT = 12.3 days
PT = 30 mins.
AR = 0.508%
Customer Demand:
615 requistions per year
PT = Process Time
LT = Lead Time
C&A = % Complete & Accurate
AR = Activity Ratio (PT/LT x 100)
RFPY = Rolled First Pass Yield
RFPY = 71%
50. Typical Differences - Manufacturing vs. Office VSMs
Manufacturing
Office
Upper right
Center
Upper left
None
“The thing” we’re
following
Raw material, subassemblies, finished goods
Paper and electronic
Information
Information Flow
More structured /
formalized I.T. systems
Multiple I.T. systems and
work-arounds
Multiple points across VSM
Work not scheduled
Inventory triangle
In-bin (if preferred)
First Pass Yield (FPY)
Percent Complete &
Accurate (%C&A)
Takt Time
Typically can be applied
Only applicable with
dedicated resources
LT determination for
each block
Based on WIP between
process blocks
Based on a single item
passing through
Straight forward
Much more refined (due to
excessive variation)
Customer icon
Supplier icon
Schedule notification
WIP icon
Quality Metric
Scope / Product
family definition
53. Traditional Method Used:
Process Flow Chart
Look up Customer
in Eclipse
SALES
New
Customer?
Yes
Enter Order
SALES
Product in
Stock?
Yes
Print Ship Ticket
SALES
Load Trucks
SHIPPING
No
No
Enter Customer
Information
ADMIN
Yes
Perform Credit
Check
FINANCE
Okay?
Notify Sales COD
Only; Notify Admin
No
to update
Customer Profile
FINANCE
Order Material
PURCHASING
Receive Material
RECEIVING
Where’s the quality? Where’s the time?
61. Metrics-Based Process Mapping
Key Metrics
Metric
CP LT Sum
CP PT Sum
AR
RFPY
# Steps
Total PT
Labor
requirements
Freed capacity
Current State
Projected
Future State
Projected %
Improvement
73. Learning Objectives
• You will learn how to:
– Identify and eliminate the eight wastes as they
exist in office and service processes.
– Use key metrics to improve office and service
processes.
– Create metrics-based process maps to identify
waste, design improved processes and
standardize office and service work.
74. For Further Questions
7770 Regents Road #635
San Diego, CA 92122
858.677.6799
ksm@ksmartin.com
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