no data, no problem webinar highlights july 2012
TRANSCRIPT
NO DATA, NO PROBLEMFind Out WHY this METHOD Has Been a Hit on Social Media TodayAND Published in Quality Digest Daily
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Our Data Collection Technique Has An Impressive Track Record
1. Client had over 500 mostly manual activities, processing time of 28 days and quality issues. In 60 days, designed a new process that was capable of processing in 5 days, cost savings of 1.5 million dollars per year, reduction in defects by 80% and ROI of 400%.
2. Client had long, manual and complex processes, its client satisfaction was low , mounting financial pressures and no visibility into the process performance. Identified a solution to eliminate all non value added activities, save 1.25 million dollars per year, simplify the application and back end processing and put in place end-to-end performance measures and scorecards.
3. Client had significant variations in productivity, significant cost over runs, and no visibility into performance. Identified a new optimized process, savings of 4 million dollars per year and significantly reduced variations in productivity.
“Kyle identified over $2M in process improvements for two major order-to-cash processes. Kyle aligned these improvements to new corporate strategies and helped develop the business case to have these improvements implemented. Kyle is innovative, driven to produce high quality results, and has proven to be an excellent investment.”
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Selected Case Studies and Testimonial
Our Data Collection Framework is 5 Easy Steps
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5. RECALIBRATE DATA
4. VALIDATE DATA WITH A PROCESS SIMULATION MODEL
3. CREATE DATA COLLECTION FORMS
CREATE MANUAL DATA COLLECTION FORMS, TRAIN EMPLOYEES AND RUN A TRIAL
2. CREATE RANDOM STRATIFIED SAMPLE
SELECT SAMPLE OF PEOPLE TO COLLECT DATA FOR 10 DAYS
1. CREATE DATA DICTIONARY
CREATE TIME, COST AND QUALITY DATA REQUIREMENTS ACROSS THE VALUE STREAM
INPUT DATA INTO SIMULATION MODEL AND COMPARE MODEL OUTPUT WITH ACTUALS
ADJUST ESTIMATES
Know Exactly What To Measure and How
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Activity #
Activity Time Metric
Volume Metric
Cost Metric
Quality Metric
Time MetricSource
Volume MetricSource
Cost MetricSource
Quality MetricSource
1 Verify applications
Time to verify
# of applications received
Cost perapplication received
% applications not verified within standard
Manual Data Collections
Database SAP and manual data collections
Manual data collections
2 Request missing information
Time to request information
Number of requests made
Cost per request
# of requests made past time standard
Manual Data Collections
Database SAP and manual data collections
Manual data collections
3 Enter application data in database
Time to enter data
Number of key strokes per application
Cost perapplication entered
Error rate per opportunity
Manual Data Collections
Database SAP and manual data collections
Manual data collections
The data dictionary includes all activities and decision nodes in the process
Data Dictionary
Create Data Collection Forms That AreEasy to Use and Complete
5
Data Collection Form for Company X (Sample)
Background
During the month of [MONTH], time measurement and other process data will be collected for a period of 10 days. The information collected will assist in the development of new, and more efficient/effective processes. Your cooperation is very much appreciated and valued.
For each form , please record the following information:
Initials Activity Time In Time Out Error Type Comments
Employee ID: Application ID: Application Type:
Stratified Random Samples that Assure High Quality Data Collection
Register for our webinar to find out more
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95% Confidence in the Quality of the Collected Data
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Region Activity MeasuredTotal number of processing
hours
ASimple Case 1,976
Complex Case 388
B Simple Case 2,275
Complex Case 662
CSimple Case 7,217
Complex Case 1,786
DSimple Case 2,276
Complex Case 436
E Simple Case 7,814
Complex Case 2,585
Total 28,032
Region Activity MeasuredTotal number of
processing hours
ASimple Case 1,965
Complex Case 443
BSimple Case 2,214
Complex Case 750
CSimple case 7,639
Complex case 2,081
DSimple Case 2,527
Complex Case 404
ESimple Case 8,082
Complex Case 2,936
Total 29,319
Simulation Model ResultsUsing Data Collected
Actual Results
4.4%Variance
Do you know how accurate is your data, in terms of time, quality and cost? You can NOW!!
Identify Important Cost Drivers in the Process
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17% 17%
13%12%
6% 6% 5%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
Visual Check of Raised Money Order on IDC or actual trays of
paid mone
Analyzing Counterfeit Client Service Enquiries and Advice
Protection unit responds to email enquiry
Download Ross data to an access file
Corporate Security Requirements
Prepare fraudulent adjustment charge back
Top Activity Costs for Protection Unit
Break Down of Percentage Costs for Checking Raised Money Order on IDC or actual tray
Identifying raised=12%Keying riteria for image ranges=1%Printing/writing LOC # on raised=1%
Locating Raised in Tray=3%Raised-Pull,Stamp,Cut,Replace=52%
Filing=5%Faxing =3%
Some costs, e.g. overhead and IT costs , allocated across activities
Distribution of Activity Costs
A B C D E F G
Activities
Do you know which activities are costing you the most?
You can NOW!!
Benchmark and Compare Critical Process Measures Like Never Before
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Processing Time Per Product By Product For Region A (Minutes)
Product Types (W,X,Y,Z)W X Y Z
ComplexProduct
SimpleProduct
Processing Time Per Product By Product For Region B (Minutes)
W X Y Z
Processing Time Per Product By Product For Region C (Minutes)
W X Y Z
Processing Time Per Product By Product For Region D (Only Simple Products) (Minutes)
W X Y Z
Product Types (W,X,Y,Z)
Product Types (W,X,Y,Z) Product Types (W,X,Y,Z)
ComplexProduct
SimpleProduct
ComplexProduct
SimpleProduct
Do you know which region, process, etc is the most efficient?
You can NOW!!
Advanced Statistical Modelling to Establish Performance Standards
Determination of Distribution Type
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Probability Plot of Processing Times by Batch Size
Do you know if your resource allocation standards are optimal?
You can NOW!!
Report Critical Time, Quality and Cost Performance Measures that Matter
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Key Findings Estimate Unit of measure Order Volume
22,405 Average per day
Number of Resources
9.5 Employees
Processing Costs
$349K $/Per year
Resource Costs
$535K $/Per year
Total Cycle Time
8 hours Hours
Lead Time
16 hours Hours
Perfect Order 79% % orders
Defects/1000 210 1000 orders
Defect Costs/order $0.6
Definitions and Explanation
OOrrddeerr VVoolluummee: Average number of orders received over the period from X to Y, 20XX.
NNuummbbeerr ooff rreessoouurrcceess:: estimated number of resources used to process orders.
PPrroocceessssiinngg CCoossttss:: Estimated processing costs (resource costs only) per year to process pmoney orders.
RReessoouurrccee CCoossttss:: Estimated resource costs paid per year for to process orders.
TToottaall CCyyccllee ttiimmee:: Average time to process an order.
TToottaall LLeeaadd TTiimmee: Average time from when works enters a process until the time it leaves.
PPeerrffeecctt OOrrddeerr:: Percentage of Orders that go through the process without manual intervention.
DDeeffeeccttss//11000000:: Number of order documents that require modification before work can pass onto the next activity per 1000 orders.
DDeeffeeccttss CCoossttss//OOrrddeerr:: Average cost for correcting a defect per order.
Are you having difficulty obtaining the right metrics? Well, that can soon be a problem of the past
Establish Various Cost Savings and Performance Improvement Scenario
Scenario 2 – Implementing Technology X Implement technology X from converting paper to electronic format
Assumptions:
1) 99% of the files are successfully converted and 1% of the files must be entered by hand.
4,261 reduction in Process hours
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Region
Work effort for Activity A
(Hours) Work effort for
Activity B (Hours)
Work effort for Activity C
(Hours) Work effort for
Activity E (Hours)
Work effort for Activity F (Hours)
Work effort for Activity G
(Hours)
Work effort for Activity H
(Hours) Total Hours
from Scenario
Total Hours from Base
Case
Reduction in Hours from
Implementing Scenario
A
136
1,942
190
75
24 1 80 2,449 2,655 206
B
143
2,130
201
79
20 1 84 2,659 2,800 141
C
406
7,136
1,353
224
152 9 240 9,519 12,000 2,481
D
201
2,667
281
111
82 6 119 3,467 3,600 133
E
485
8,030
1,616
267
16 0 286 10,700 12,000 1,300
Total
1,371
21,905
3,641
757
294
17 809 28,794 33,055 4,261
How confident are you in your projected savings and performance improvement from your projects?
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