Streamlining

RESTRUCTURING

In today’s rapidly changing marketplace, being agile is key to survival.

Agility refers to your organization’s ability to perceive, think and respond quickly.

Detailed, complicated processes can not keep up with the speed of innovation and change required to succeed in today’s environment
To become more agile, an increased level of decision-making and authority must be driven closer to the customer. Through simplified processes which are focused on value adding activities, flexibility can be built into a standard way of doing things so that front line workers can respond directly to customers’ requests.
We will partner with you and your teams to define current processes, identify the non-value adding activity, streamline the future state and build in flexibility where required to enable agility.

How We Helped

Streamlines Process Improves Accounts Payable Improves Review Process

Streamlines Process

Large industrial chemical company streamlines the commodity strategy development process

Opportunity: A Fortune 100 chemical manufacturing company lacked a standard process to help them leverage their buying of commodities across all regions. Sourcing people were located around the world. This distance and time gap made communications a challenge. They did not see themselves as part of a team which resulted in insufficient leverage on some very large global purchases of materials. There was no defined, documented strategic commodity sourcing process; hence, there was no clear view of the opportunities and no clear metrics by which to gauge success. The SVP of Procurement thought there was a very large opportunity to bundle purchases and optimize savings.

Workout (Kaizen) approach was used with a significant percentage of the Global Sourcing Leadership team in a facilitated HQ based event, championed by the SVP of Procurement.
Seasoned sourcing experts agreed on the current state process(es) and mapped out a future state to uniformly and quickly determine and execute a global commodity strategy
Metrics were put in place to measure the successful implementation of this new process.

Results: The future state process shrunk the commodity strategy development for products from a range of 1.5 – 3 years to an average of 90 days. Several teams achieved immediate success after using the new process. The company not only adopted the new strategic process but also adopted the use of Workout throughout the sourcing organization to achieve faster team results.

Improves Accounts Payable

Fortune 100 company attacks accounts payable long cycle time and high exception payment process

Problem: Suppliers to a Fortune 100 Company were complaining about late payments from the centralized accounts payable process. Sourcing and operational leaders were concerned these complaints would damage ongoing negotiations and relationships with suppliers. Initial analysis/data showed payments took an average 41 days on a volume of 40K invoices per month. (35 days for invoices with no ‘exception issues’, 58 days for invoices with ‘exception issues’)

Cross functional team including finance, sourcing and operations developed metrics including a Scorecard to focus on most important parameters
Utilized “lean” tools & techniques to shrink overall cycle time by eliminating nonvalue adding approval and movement steps
Engaged leadership team to drive behavior
Implemented several process solutions, including focusing on driving down invoice ‘exceptions’ and measuring timeframe in which they were handled by sourcing personnel

Results: After 1 year, cycle time for the monthly volume of 40,000 invoices was reduced from 35 to 25 days which resulted in an improvement of on-time payment (from suppliers’ perspective) from 75% to 85%.

Improves Review Process

Office of Planning attacks an unpredictable, painfully slow, nontransparent land tract review process.

Opportunity: The Office of Planning in a large urban American city received frequent complaints about their Land Tract Review process. This approval process was required by businesses when establishing new storefronts or other service locations in the city. The process was described as slow, opaque, unpredictable and caused the city to lose opportunity to provide services to their citizens. Office of Planning project managers spent too much time providing status information and not enough time on helping the process to flow.

Conducted interviews and focus groups including legal experts, business owners, city agencies and community members to identify most important CTQ’s (Critical to Quality characteristics) and where the process was falling short of expectations.
Documented process map to streamline and reduce unnecessary steps, standardize, reduce the cycle time and increase both transparency and visibility of the process to the multiple agencies involved.
Digitized process to connect all parties using web-based forms and a standard pre-application meeting format to include all relevant parties up-front.
Benchmarked other cities to identify beneficial changes including a binding review process and separating projects by size and type to increase speed of smaller projects.
Linked business license process with the office of planning to ensure review affected licensure decision making.

Results: Reduced the number of days to process a large tract review from an average of 138 days to 60 days, receiving accolades from all parties involved.

Additional Items

Effective Tools Key Questions

Effective Tools

Cycle Time Value Added Analysis Tool – This tool allows teams to analyze each step in the process in terms of 1) cycle time (time to process one unit or service) and 2) value adding (Steps are essential because they change the product/service, customer is willing to pay for them and they are done correctly the first time.) The team-based analysis shows which steps should be eliminated and which have longer cycle times, becoming bottlenecks (slowing the flow of the overall process) requiring optimization

Value Stream Map – Looking at your processes from a birds’ eye view allows you to identify the flow of value from suppliers, through your process and to your customers. Taking a critical eye to this flow of value enables you to identify the most significant waste and prioritize improvement efforts.

Process Analysis – Once Key Process Indicators (KPI’s) have been identified, we can measure the process and see how close we are to the process’ target. The gap between the target and our goal identifies the opportunity to improve. The target can be related to cycle time, defects, cost, customer impact or process traceability and status.

Define, Measure, Analyze, Improve, Control Approach (DMAIC) – in order for teams to effectively attack the opportunity, they must be taught a methodology to improve. Depending upon complexity, teams can use a cycle of Plan, do, check act, (PDCA) or the DMAIC (Lean Six Sigma) project-based approach.

Lean Pull Systems and Takt Time Analysis - A lean pull system is one designed to ensure work is pulled through the system only if there is a demand for it. Pull systems use a trigger which starts with a customer demand and finishes with a supplied product or service. Takt time analysis involves studying your customer demand for products/services at different times of the day/week to ensure that your system (people, equipment, processes) is set up to provide services at a rate which matches customer demand. Whether your customer is a patient visiting your healthcare center, a consumer buying a product or an internal customer requiring a report. All will benefit from a system designed for ‘pull’.

Key Questions

How quickly are you able to respond to customers’ requests for new products, pricing or services? Do you measure this? If not, how do you know?
Have you lost business because your organization could not respond quickly enough to an urgent or changing customer request?
How integrated are your salespersons with your operational teams to ensure the voice of the customer is clearly and quickly articulated and disseminated?
Does information or customer requirements become ‘stuck’ somewhere in the middle of your organization?
How effective are you at making decisions?