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04/10/231
Lean Six SigmaImplementation ExperiencesIn Financial Services Industry
Jim KaminskiHuntington Bank
Internal Business Consultant
2nd Annual SuccessfullyImplementing Six Sigmain Financial Services
June 21-23, 2005
The Westin Times SquareNew York, New York
04/10/232
Personal Background
15 Years Financial Services Industry Experience10 Years CI Methods in 3 Companies, Financial Services
15 Years Financial Services Industry Experience10 Years CI Methods in 3 Companies, Financial Services
Introduction
Experiences In Continuous Improvement
• PNC Bank – Launched CI Initiative
• Bank One – Led CI initiative, Launched Lean Six Sigma
• Huntington Bank– Re-Launch Lean Six Sigma
PNC BankFinancial Services
CI
Chase/Bank OneFinancial Services
CI, Lean, Six Sigma
Huntington BankFinancial ServicesLean, Six Sigma
04/10/233
This case study will highlight practical experiences and implementation options for deploying Lean and Six Sigma.
This session will cover topics including the importance of valuing and assessing the organizations readiness before committing
to a fully embedded LSS deployment. In addition understandingthe importance of and maturity of your business lines and
carrying out a controlled piloting effort.
Highlights include proof of concept deployment efforts at Bank One/Chase. In addition, how Huntington Bank has leveraged
a small cadre of internal resources to deploy Lean Six Sigma at the grassroots: using a pilot and demonstration projects to generate
successes and therefore create pull for Lean Six Sigma methods.
Case Study Overview
Overview
04/10/234
LSS Implementation Options
#2 Execute & Morph#2 Execute & Morph#2 Execute & Morph#2 Execute & Morph
On YourMark
Go GetSet
#1 Plan & Execute
On YourMark
GetSet
Go
Business Culture and CI Maturity are Key Performance Indicators for Implementation Approach
Business Culture and CI Maturity are Key Performance Indicators for Implementation Approach
- Proof of Concept (Pilot)#3 Pilot, Plan, & Execute
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
On YourMark
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
Go
Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
GetSet
Assess CultureAssess CultureAssess CultureAssess CultureAssess CultureAssess CultureAssess CultureAssess CultureAssess CultureAssess CultureAssess CultureAssess Culture• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•
Get Ready
• Conduct Pilots•
04/10/235
Start
AcceptanceIn
crea
sin
g L
evel
s o
f A
ccep
tan
ce
Time
LSS Deployment Continuum-Proof of Concept
Decreasing Challenges
•Assess Culture
•Strategy•Infrastructure
• Benefits
• Conduct Pilots
•Vision
•Project Selection•Training
•Leadership
•Execution
•Implementation•Sustainability
• Celebrate Success
• Create Pull for LSS
•Assess Culture
•Infrastructure
•Mission
•Modify•Assess Culture
04/10/236
LSS Deployment: Assessing the Culture
AlignmentLine of Business Strategy
Operational Strategy“Know Your Customer”
Economic Figures
ConfigurationQuality ReviewsCapacity Models
End-End AccountabilityScalability
ConductScorecards
TargetsAccountability
IncentivesBusiness ReviewsCI Fundamentals
PeopleInternal Value PropositionExternal Value Proposition
Foster FeedbackTrainingAttrition
Assess Assess CultureCulture
Assess Assess CultureCulture
Understanding how these drivers of performance impacts the organization willhelp determine an approach for deploying LSS
Understanding how these drivers of performance impacts the organization willhelp determine an approach for deploying LSS
04/10/237
LSS Deployment: CI Fundamentals
Voice ofProcess
BusinessReview
Within Organization
With Suppliers
WithCustomers
Reset Project Priorities
TOP 5
•From Operating PlansPlan
•From BusinessReviews
Control Charts
MeasureResults
MeasureResults
MeasureVariation
& C/T Ongoing&
Sustain Gains
Control Charts
PerformanceScorecards
SpeedQuality
ProductivityFinancial
People
Identify Degrees& Type of
Process VariationAnd Cycle Time
CustomerVoice of
VerifyCustomer’s
Requirements
Voice ofMarket
ImplementKnown
Solution
Impro
ve
Pro
cess
es
Des
ign
Solve Problems;Reduce VariationAnd Cycle Timewith AdditionalTools & Methods
Pro
cess
es
LSS
….A more powerful process which will enable the next generation of problemsolving (Lean and Six Sigma) that will deliver on stretch performance commitments
….A more powerful process which will enable the next generation of problemsolving (Lean and Six Sigma) that will deliver on stretch performance commitments
RequirementsRequirements IdentificationIdentification PrioritizationPrioritization ExecutionExecution BenefitsBenefits
04/10/238
CI Fundamentals: Setting the Foundation for LSS
Gen 2: Six Sigma
CI Fundamentals
Gen 3: LSS
• Rigorous 6 Step Problem Solving Approach coupled with Statistical Tool Use•Kaizen Problem Solving DMAICT and Lean
+CI Fundamentals
Gen 2: Six Sigma
• Validate CTQ
-- Develop VOC• Measure Process Variation
-- Control Charts-- Process Capability
++CI Fundamentals
Gen 1: Lean
• 5s•Kaizen•Pull Systems
CI Fundamentals
• Metrics• Scorecards
• Production Reviews•Basic Problem Solving
•Dashboard
Every house needs a foundation to build uponCI Fundamentals is the foundation in which to build a LSS program
Every house needs a foundation to build uponCI Fundamentals is the foundation in which to build a LSS program
04/10/239
Org. Overview
Methodology – CI evolving to Lean Six Sigma
Environment
•Results driven•No history of Corp. Quality Initiative • Internal morale issues re: quality •Service Excellence initiatives
successful, but stalling
Areas of Emphasis
•Day 1 and Day 2 Operations•Quality; productivity; cycle time; investment avoidance; capacity
Implementation
• Owned/Driven by Operational CEO• LOB strategy/Business driven• 40% IC linked to results• High Potentials – MBB’s & BBs
Lean Six Sigma - “A Guide for Everything We Do”
CI and Lean Strategy
CI and Lean Six Sigma viewed as: “Next Level of Problem solving to Achieve world class quality andImprove Corporate profitability”
Proof of Concept Approach, Incremental gains
Chase/Bank One
04/10/2310
Adopt Experience
Challenges• Most valued resources supporting multiple priorities• Participation positioned like Army draft• “Not Invented Here” resistance; “Corporate” project• No impetus to change (at launch)• Competing Corporate priorities & resources Eventual Approach Modifications (after 1 year)• Hired in skills to create critical mass & commitment • Department established; “Career choice”• CI approach; No large-scale implementation
Adoption ExperiencesChase/Bank One
Chase/Bank OneFinancial Services
CI, Lean, Six SigmaAdopt
PNCKey Bank
GECI, Lean, Six Sigma
04/10/2311
Start
Acceptance
Incr
easi
ng
Lev
els
of
Acc
epta
nce
Time
Decreasing Challenges
Chase/Bank One
•Assess Culture
•Strategy•Infrastructure
• Benefits
• Conduct Pilots
•Vision
•Project Selection•Training
•Leadership
•Execution
•Implementation•Sustainability
• Celebrate Success
• Create Pull for LSS
•Assess Culture
•Infrastructure
•Mission
•Modify•Assess Culture
LSS Deployment Continuum-Proof of Concept
04/10/2312
CI Evolution to Lean Six SigmaChase/Bank One
CI Fundamentals
• Metrics• Scorecards
• Production Reviews• Basic Problem Solving
•Dashboard CI Fundamentals
Gen 2: Six Sigma
+
• Validate CTQ
-- Develop VOC• Measure Process Variation
-- Control Charts-- Process Capability
Gen 2: Six Sigma
CI Fundamentals
Gen 3: LSS
• Rigorous 6 Step Problem Solving Approach coupled with Statistical Tool Use:
DMAICTLEAN
++CI Fundamentals
Gen 1: Lean
• 5s•Kaizen•Pull Systems
11
22
33
04/10/2313
Lessons Learned
Lessons Learned
•Cultural and Readiness Assessment•Introduction of CI fundamentals•Corporate wide training•Project teams•Acquiring time•Making true lean sigma improvements•Making lean six sigma a priority amidst the other initiatives•Speaking in the organization’s language versus Lean Manufacturing or Six Sigma language•People’s ability to match their process issue/need with lean six sigma as solution will just take time.
Lessons LearnedChase/Bank One
04/10/2314
Org. Overview
Methodology – Evolution of Lean Six Sigma
Environment
•Early stages in Corp Quality Initiative •Adoption of Operational Excellence
Initiative successful, but stalled•Regions have options to opt out, not currently a Corp mandate
Areas of Emphasis
•Mortgage, Retail, Treasury Mgmt,
Call Centers, Product•Quality; productivity; cycle time; capacity, revenue
Implementation
• Owned/Driven by Retail Executive• LOB strategy/Business driven• 60% IC linked to results• Internal Consulting Group-
Black Belts
Lean Six Sigma Strategy
Lean and Six viewed as: “ Gen 2Of Simply the Best Service Initiative
Pathfinder Approach, Small wins
Huntington Bank
Lean Six Sigma - “A Guide for Some Things We Do”
04/10/2315
Adoption Experience
Challenges• Early maturity in CI; fundamentals to build upon spotty• Limited “right” data• Lacked Top Down sponsorship• Mentality of “manufacturing only” use• Excessive statistics & tools Eventual Approach Modifications (after 6 months)• Limit scope• Pilots to deliver $s and Lessons Learned • Post Pilots: limited roll-out to “ready” groups
Adoption ExperiencesHuntington Bank
Huntington BankFinancial ServicesLean Six Sigma.
Adopt
Bank OneFinancial Services
CI and Lean
04/10/2316
Start
Acceptance
Incr
easi
ng
Lev
els
of
Acc
epta
nce
Time
Decreasing Challenges
Huntington Bank
•Assess Culture
•Strategy•Infrastructure
• Benefits
• Conduct Pilots
•Vision
•Project Selection•Training
•Leadership
•Execution
•Implementation•Sustainability
• Celebrate Success
• Create Pull for LSS
•Assess Culture
•Infrastructure
•Mission
•Modify•Assess Culture
LSS Deployment Continuum-Proof of Concept
04/10/2317
Evolution Lean Six SigmaHuntington Bank
CI Fundamentals
• Metrics• Scorecards
• Production Reviews•Basic Problem Solving
•Dashboard
+CI Fundamentals
Gen 1: Lean
• 5s•Kaizen•Pull Systems
22
33
+CI Fundamentals
Gen 2: Six Sigma
• Validate CTQ
-- Develop VOC• Measure Process Variation
-- Control Charts-- Process Capability
Gen 2: Six Sigma
CI Fundamentals
Gen 3: LSS
• Rigorous 6 Step Problem Solving Approach coupled with Statistical Tool Use:
DMAICTLEAN
+
11
44
04/10/2318
Lessons Learned
Lessons Learned
• A simple architecture• Internal expertise • Modify the model to fit your organization• Go at a pace that suits the organization’s readiness• Focus on creating pull; don’t force agenda• Don’t apply the tools in an area not ready• Start small, build successes, and sell like Ronco !!• Be selective with your hosts for pilots
Lessons LearnedHuntington Bank
04/10/2319
Chose #1: Experience The Culture; Deliver $$’s; Create PullChose #1: Experience The Culture; Deliver $$’s; Create Pull
LSS Implementation Options
#3 Plan & Execute
- Proof of Concept (Pilot)#1 Pilot, Plan, & Execute#1 Pilot, Plan, & Execute
#2 Execute & Morph#2 Execute & Morph#2 Execute & Morph#2 Execute & Morph
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
On YourMark
• AssembleMinimumInfrastructure
• AssembleMinimumInfrastructure
Instead ofInstead ofInstead ofInstead ofInstead ofInstead ofInstead ofInstead ofInstead ofInstead of
On YourMark
On YourMark
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
• ExecutePlan
Go
Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
• Set - Vision- Mission-
GetSet
Assess CultureAssess CultureAssess CultureAssess CultureAssess CultureAssess CultureAssess CultureAssess CultureAssess CultureAssess CultureAssess CultureAssess Culture• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•• Conduct Pilots•
Get Ready
• Conduct Pilots•
Go GetSet
GetSet
Go
04/10/2320
Pilot Approach
“On Your Mark”: Small Investment, Below Radar“On Your Mark”: Small Investment, Below Radar
LSS Implementation
Assemble minimum requirement infrastructure…
• Assume small scope, 2-4 pilots
• Hire or procure expertise – Lean Manufacturing / Six Sigma
• Select internal trainees – High Potentials
• Procure or create documented approach – “Event” / DMAICT
• Partner with Business Unit on their priorities
Example: Mortgage Application Cycle Time
04/10/2321
Pilot Approach
“Get Ready”: Cause & Effect Wins; Culture Lessons Learned“Get Ready”: Cause & Effect Wins; Culture Lessons Learned
Conduct pilots…
• Select several projects & areas (risk management)
• Focus - small scope: avoid “world hunger”
• Define participation of process owners: who & roles
• Design execution format & expectations: e.g. Pre-work, event, follow-up, sustain
• Measure tangible results
• Grab learning nuggets along the way
Example:Mortgage Cycle Time Reduction
LSS Implementation
04/10/2322
Pilot Approach
• Credit the sponsor with success
• Address participant’s time availability issues
• Address Implementation challenges & abilities
• Assess characteristics of readiness
• Modify methodology to fit readiness / culture
• Maintain orientation: exponential # of successes required to overcome any failures.
LSS Implementation
Key Learnings from Pilot that feed “Get Set” PhaseKey Learnings from Pilot that feed “Get Set” Phase
Assess the Culture…
Example: Mortgage Cycle Time Reduction
04/10/2323
Pilot Approach
• “Success” positions LSS for commercialization
• Door-to-door sell w/ sponsors during operating plan build
• Resources added to ICG on basis of demand
• Continued application based training for trainees
• Positioned as a “service” of ICG
LSS Implementation
“Get Set” and Go: Plan and Implement at A Pace Your Organization Can Handle “Get Set” and Go: Plan and Implement at A Pace Your Organization Can Handle
Get Set and Go
Example:
04/10/2324
Takeaways.
Summary
• Traditional Implementation Methods have not translated well
• The Business Culture and CI Maturity are Key Performance Indicators for Implementation Approach
• Pilot Approach is a viable precursor to broader implementation
• Pilots allow for $ return and lessons learned re: culture and maturity
• Pilots allow for longer term implementation design fitted for the business
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