Tuesday, February 26, 2019
Lean Six Sigma in Hrm
1 track d confess sextette Sigma in the operate intentness A slightandro Laureani University of Strathclyde United Kingdom 1. Introduction The argumentation repairment methodological psychoanalysis known as pitch sixer Sigma is rooted in the manufacturing industry, where it develop over the past few decades, reaching widespread adoption worldwide.However, gibe to the World Economic Outlook Database, published in April 2011, by the external pecuniary Fund (IMF, 2011), the distribution of PPP (Purchase Power Parity) GDP, in 2010, among unlike industry celestial spheres in the main worldwide economies, reflected a dec limn in the industrial sector, with the go sector now representing three-quarters of the US economy and much than than half of the European economies. PPP GDP 2010 Agriculture Industry operate European Union 5. 7% 30. 7% 63. 6% United States 1. 2% 22. 2% 76. 7% chinaware . 6% 46. 8% 43. 6% India 16. 1% 28. 6% 55. 3% knock back 1. PPP GDP Sector comparis on 2010. In light of the change magnitude importance of the servicing sector, the objective of this chapter is to converse whether the business improvement methodological analysis known as inclination of an orbit sextette Sigma is applicable to the wait on industry as well, and exemplify some boldness study industrys. 2. What is track down vi Sigma? flex six-spot Sigma is a business improvement methodological analysis that aims to maximize sh atomic result 18holders jimmy by meliorate superior, speed, node satisfaction, and damages.It achieves this by merging tools and principles from both(prenominal) listing and sise Sigma. It has been astray select widely in manufacturing and divine run industries, and its success in some renowned geological formations (e. g. GE and Motorola) has created a copycat phenomenon, with many organizations crosswise the world free to replicate the success. www. intechopen. com 4 modern Topics in Applied trading operations f orethought magnetic inclination and vi Sigma go followed independent paths since the 1980s, when the bounds were stolon hard-coded and circumscribed. conquer Key and Word Text and Graphics.The first applications of magnetic inclination were recorded in the Michigan plants of Ford in 1913, and were then developed to perfection in Japan (within the Toyota Production System), while half a dozen Sigma saw the light in the United States (within the Motorola Research Centre). race is a do-improvement methodology, intentiond to pitch products and function repair, faster, and at a unhorse cost. Womack and Jones (1996) defined it as a way to specify nourish, line up value-creating actions in the best sequence, conduct those activities without perturbation whenever someone requests them, and perform them more than(prenominal) than and more effectively.In short, disposition thinking is lean because it provides a way to do more and more with less and lessless world effo rt, less homosexual equipment, less clock, and less distancewhile coming closer and closer to providing clients with exactly what they want. (Womack and Jones, 1996p. ) half a dozen Sigma is a data-driven process improvement methodology used to achieve stable and certain process results, diminution process variation and defects. Snee (1999) defined it as a business strategy that seeks to identify and cash in ones chips causes of errors or defects or failures in business processes by foc using on outputs that are critical to customers.While both lam and sextet Sigma have been used for many years, they were non unified until the late 1990s and early 2000s (George, 2002 George, 2003). Today, course sextuplet Sigma is recognized as a business strategy and methodology that increases process performance resulting in enhanced customer satisfaction and improved bottom line results (Snee, 2010). Lean hexad Sigma uses tools from both toolboxes, in order to get the best from th e 2 methodologies, increasing speed while also increasing accuracy. The benefits of Lean sestetSigma in the industrial world (both in manufacturing and services) have been highlighted extensively in the lit and include the following 1. 2. 3. 4. 5. 6. Ensuring services/products conform to what the customer deficiencys ( verbalise of the customer). Removing non-value adding timbres (waste) in critical business processes. Reducing the cost of poor quality. Reducing the incidence of defective products/transactions. Shortening the pedal time. Delivering the sic product/service at the good time in the right place. Antony, 2005a Antony, 2005b) Examples of real benefits in various sectors are illustrated in hold over 2. unmatchable of the distinguish aspects differentiating Lean 6 Sigma from previous quality initiatives is the organization and complex body part of the quality implementation functions. In quality initiatives prior to Lean half dozen Sigma, the steering of quali ty was relegated largely to the production floor and/or, in large organizations, to some statisticians in the quality department.Instead, Lean sixer Sigma introduces a white-tie organizational infrastructure for different quality implementation roles, borrowing linguistic process from the world of martial arts to define hierarchy and maintenanceer paths (Snee, 2004 Antony, Kumar & Madu, 2005c Antony, Kumar & Tiwarid, 2005d Pande, Neuman & Cavanagh, 2000 blight & Schroeder, 1999 Adams, Gupta & Wilson, 2003). www. intechopen. com Lean 6 Sigma in the suffice Industry 5 Table 2. Benefits of Six Sigma in return Organizations (Antony, Kumar & Cho, 2007). 3. Lean Six Sigma and the service industryThe service industry has its own special characteristics, which differentiate it from manufacturing and sterilise it harder to apply Lean Six Sigma tools, which git be summarized in the following main subject fields (Kotler, 1997 Regan 1963 Zeithmal, Parasur and berry 1985) Intangibili ty Although services bear be consumed and perceived, they ordurenot be measured soft and objectively, like manufacturing products. An objective measurement is a critical aspect of Six Sigma, which requires data-driven decisions to eliminate defects and reduce variation.The lack of objective metrics is usu every(prenominal)y address in service organizations through the use of proxy metrics (e. g. customer survey). Perishability benefits cannot be inventoried, but are instead delivered simultaneously in response to the demand for them. As a consequence, services processes contain cold too much work-in-process and work can spend more than 90% of its time waiting to be executed (George, 2003). Inseparability Delivery and consumption of service is simultaneous.This adds complexity to service processes, unknown to manufacturing. Having customers waiting in line or on the phone involves some emotional management, not present in a manufacturing process. Variability Each service is a uni que shell dependent on so many changing conditions, which cannot be reproduced exactly. As a result of this, the variability in service processes is much high(prenominal) than in manufacturing processes, leading to very different customer experiences. www. intechopen. com 6 mod Topics in Applied Operations focal pointOwing to these inherent differences, it has been harder for service organizations, much(prenominal) as financial companies, health-care providers, retail and hospitality organizations, to apply Lean Six Sigma to their own reality. However, at that place are also great opportunities in the service organizations (George 2003) falsifiable data has shown the cost of services are inflated by 3080% of waste. Service functions have little or no biography of using data to let decisions. It is a lot thorny to retrieve data and many headstone decision-makers may not be as numeri phone discovery literate as some of their manufacturing counter move.Approximately 30 50% of the cost in a service organization is caused by cost link up to ho-hum speed, or carrying out work again to satisfy customer needs. In the last few years, successful applications in service organizations have have intercourse to fruition and we will illustrate three possible applications in a scratch subject matter, in human resources, and fin tout ensembley in a healthcare provider. 4. Case study 1 Lean Six Sigma in a call revolve around (Laureani et al, 2010a) The two major examples of call internalitys are out passing play unions and inbound centres. The most common are inbound call centre operating theaters.Almost everyone in their daily life has had to call one of those centres for a cast of reasons. Outbound centres are used more in areas such as marketing, sales and credit collection. In these instances, it is the call centre operators who manifest edge with the user. Although there are some differences between outbound and inbound call centres, they ea ch have certain potential benefits and challenges, with regard to the implementation of Lean Six Sigma. Benefits Some of the benefits that Lean Six Sigma can deliver in a call centre are (Jacowski, 2008 Gettys, 2009) . 2. 3. 4. 5. menseslining the operations of the call centre Lean strategy fosters in eliminating waste and other non-value added activities from the process. Decreasing the compute of lost calls Six Sigmas root-cause analysis and hypothesistesting proficiencys can assist in determining how much time to spend on different type of calls, olibanum providing a string to the operators. Better use of resources (both human resources and technology), thus leading to a decrement in the cost of running such centres.Unveiling the hidden factory establishing the root causes of why customers call in the first place can jockstrap in uncovering trouble only along the process, providing benefits that go further than the call centre itself, up(p) customer service and support. Reducing employee turnover call centres are usually characterized by high employee turnover, owing to the highly stressful work environment. A more streamlined operation would assist in reducing operators stress, particularly in an inbound centre. ChallengesSpecific challenges of applying Lean Six Sigma in a call centre environment (Piercy & Rich, 2009) www. intechopen. com 7 Lean Six Sigma in the Service Industry 1. 2. 3. The relentless pace of the activity (often 24/7) makes it more unmanageable for key staff to find the time to become involved in disgorges and Lean Six Sigma training. The realization of an appropriate measurement placement analysis (MSA) (Wheeler & Lyday, 1990) is difficult because of the inherent subjectivity and interpretation of some call types, weakness duplicability tests of different call centre operators.High employee turnover, that normally characterizes call centres, makes it more difficult for the programme to remain in the organization. Strengths W eaknesses ? ? Root cause analysis can determine major reasons for customers calls, helping to unveil problems further along the value stream map of the play along Lean Six Sigma deployment requires significant enthronisation in training, that may be difficult from a time prospect in a fastpaced environment such as a call centre Opportunities Threats ? ? ? ? ? Decrease number of lost calls Reduce waiting time for calls in the queue Improve employee productivity (i. . number of calls dealt with by the hour) ? lack of metrics Lack of support from process owner Preconceived ideas Table 3. SWOT Analysis for the Use of Lean Six Sigma in a diagnose Centre. Overall, the opportunities far outweigh the challenges. bring forward centres nowadays are more than just operations they are the first, and some measure a unique, point of clashing that a high society may have with its customers. Their efficient and effective running, and their by the bye resolution of customers queries, all go a long way to establishing the fraternitys brand and image. Project selection is a critical fixings of success.Not all projects may be suitable vistas for the application of Lean Six Sigma, and this needs to be kept in mind in assessing the operation of a call centre. Also, different tools and techniques may be more suitable to a specific project, depending on the nature and characteristics of the process it is trying to address. Projects that better lend themselves to Lean Six Sigma share, inter alia, the following characteristics ? The focus of the project is on a process that is either not in statistical delay (unstable) or outside customer specifications (incapable).As already mentioned in the introduction, Six Sigma techniques focus on reducing the variation in a process, reservation them the ideal tools for tackling an incapable but stable process, whereas Lean tools focus more on the elimination of waste and would be the first port of call for streamlining an unstable p rocess. Priority should be given to unstable processes, using Lean tools to eliminate the waste and simplify the process. Once it has stabilized, more advanced statistical tools from the Six Sigma toolbox, can be used to reduce variation and make the process capable. ww. intechopen. com 8 ? ? ? modernistic Topics in Applied Operations Management The root reason(s) for this has not been identified yet. It is important to start work on the project with an open mind and without any prejudice. Data and hard facts should guide the project along its path. duodecimal metrics of the process are available. A lack of measures and failing to realize a complete measurement system analysis (MSA) (Wheeler & Lyday, 1990) can seriously jeopardize any improvement effort. The process owner is supportive and willing to provide data and resources.This is critical for the current success of the project the process owners role is discussed in detail in the Control Phase section. Potential areas of foc us for Six Sigma projects in call centres (Gettys, 2009) ? ? ? ? Lost call ratio out of fall calls for an inbound call centre Customer waiting/holding times for an inbound call centre First-call resolution Calls back inflating call volumes. Call centres are increasingly important for many businesses and are struggling systematically with the pressure of delivering a better service at a lower cost.Lean Six Sigma can improve the operation of a call centre through an increase in first-call resolution (that reduces the failure created by failing to answer the query in the first place), a reduction in call centre operator turnover (leveraging on training and experience), and streamlining the rudimentary processes, eliminating superfluous operations. Given the large scale of many call-centre operations, even a relatively belittled improvement in the sigma value of the process can dramatically reduce the defect rate, increase customer satisfaction and deliver financial benefits to the bottom line (Rosenberg, 2005).By focusing on eliminating waste, identifying the real value-adding activities and using the DMAIC tools for problem-solving, it is possible to achieve significant improvements in the cost and customer service provided (Swank, 2003). 5. Case study 2 Lean Six Sigma in HR judiciary (Laureani & Antony, 2010b) In the late 1980s, when Motorola implemented Six Sigma originally, obtaining astonishing results, the company was then faced with the dilemma of how to reward its employees for these successes (Gupta, 2005).This was the first time Six Sigma and HR practices came into contact, and a more accurate definition of HR practices was needed. If, in the past, the term HR was related only to administrative functions (e. g. payroll, timekeeping, etc. ), the term has increased substantially, in the last few decades, to include the acquisition and application of skills and strategies to maximize the return on investment from an organizations human nifty (Milmor e et al, 2007). HR management is the strategic approach to the management of all people that contribute to the achievement of the objectives of the business (Armstrong, 2006).As such it includes, but it is not limited to, force-out administration. In effect it includes all steps where an employee and an organization come into contact, with the potential of adding value to the organization (Ulrich, 1996). www. intechopen. com Lean Six Sigma in the Service Industry 9 As such, and merging terminology from Lean and HR, we define the following seven points as the benevolent Capital look on Stream Map 1. 2. 3. 4. 5. 6. 7. Attraction Selection Orientation (or induction) Reward culture Management Separation Fig. 1. charitable Capital Value Stream Map.The Human Capital Value Stream Map is a Lean technique that identifies the flow of information or material required in delivering a product or service to a customer (Womack & Jones, 1996). Human enceinte is the accumulated skills and expe rience of the human force in an organization (Becker, 1993). The Human Capital Value Stream Map is the flow of human capital required for an organization to deliver its products or service to customers the objectives of which are presently described below ? ? ? ? ? ? ? Attract to establish a proper employers brand that attracts the right calibre of individual.Select to select the best possible candidate for the job. Orient to fix new employees are properly trained and interconnected into the organization. Reward to ensure compensation packages are appropriate and in line with the market. Develop to distinguish talent and ensure career progression. Manage to superintend and administer the day-to-day jobs. Separation to track reasons for voluntary leavers and maintain a constructive relationship. It is possible to apply Lean Six Sigma tools to each step of the Human Capital Value Stream Map, in order to eliminate waste in the HR process Wyper & Harrison, 2000). For each step in th e Human Capital Value Stream Map it is necessary to establish proper quantitative metrics that allow objective assessment and control of the process step (Sullivan, 2003). This makes use of the more quantitative statistical tools from the Six Sigma toolbox possible. Establishing HR metrics can be controversial, with different parts of the organization having different objectives (Jamrog & Overholt, 2005), but the answer to these simple questions may help to focus on the real value each step can provide. 1. 2. 3.What is the expected deliverable of the step? What are the relevant metrics and key performance indicators of the step? What are the opportunities for defects in the step? www. intechopen. com 10 Advanced Topics in Applied Operations Management For recruitment, for example, the answers to the above questions may be as follows. 1. 2. 3. Hire, in the shortest possible time, new members of staff to fulfil a certain job. The number of days to fill a vacancy (also define the accep table norm for the organization). Any job remaining vacant for chronic than the acceptable norm.Similar thought processes can be performed for other steps having set out metrics for each step of the Human Capital Value Stream Map, an organization is now in the position to apply Six Sigma DMAIC to it. Six Sigma can be used to improve administrative processes, such as HR processes. Implementing the Six Sigma DMAIC breakthrough methodology in HR follows the resembling path as implementing it in any other part of the organization. However, there are some specific key learning points and challenges for the HR area, such as ? ? ?Difficulty in establishing an appropriate measurement system analysis and metrics Data collection can be extremely difficult, as the project team is dealing with very sensitive issues and Difficulty in performing any pilot or design of experiment. Any of these is going to impact on the behaviour of staff, making it difficult to measure its results accurately. A s a result, projects may last longer than the standard four to six months and the wider use of tools such as brainstorming and Kaizen workshops with domain experts may be necessary (Lee et al, 2008).Examples of potential Six Sigma projects in the HR function are ? ? ? ? ? ? reduction of employees turnover reduction in time and cost to mesh a new employee reduction in training costs reduction in cost of managing employees separation reduction in administrative defects (payroll, benefits, wild pay, etc. ) reduction in queries from the employee population to the HR department. Every area of an organization needs to perform better, faster and more cheaply, to keep the company ahead of the competition, and be able to satisfy ever-increasing customer expectations.HR is no exception more cost-effective and streamlined HR processes will create value for the organization, instead of just being a support act for management (Gupta, 2005). 6. Case study 3 Lean Six Sigma in health-care livery Health care is a complex business, having to balance continuously the need for checkup care and attention to financial data. It offers pocket of excellence, with outstanding advances in technology and treatment, together with inefficiencies and errors (Taner et al, 2007). Everywhere in the world, the financial pressures on health care have increased steadily in the last decade.While an develop population and technological investments are often cited as culprits for these financial pressures, unnecessary operational inefficiency is another source www. intechopen. com Lean Six Sigma in the Service Industry 11 of cost increases, largely under the control of health-care professionals (de Koning et al, 2006). Lean Six Sigma projects so far in the health-care literature have think on direct care delivery, administrative support and financial administration (Antony et al, 2006), with projects executed in the following processes (Taner et al, 2007) ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? increasing capacitor in roentgen ray rooms reducing avoidable emergency admissions improving day elusion performance improving accuracy of clinical coding improving patient satisfaction in Accident and Emergency (A&E) reducing turn-around time in preparing medical reports reducing bottle necks in emergency departments reducing cycle time in various inpatient and outpatient diagnostic areas reducing number of medical errors and hence enhancing patient safety reducing patient fall reducing errors from high-risk medication educing medication ordering and administration errors improving active management of personnel costs increasing productivity of health-care personnel increasing accuracy of laboratory results increasing accuracy of billing processes and thereby reducing the number of billing errors improving bed availability across various departments in hospitals reducing number of postoperative wound infections and related problems improving magnetic resona nce imaging exam scheduling reducing lost MRI films improving turn-around time for drugstore orders improving nurse or pharmacy technician recruitment mproving operating theatre throughput increasing surgical capacity reducing length of stay in A&E reducing A&E diversions improving revenue cycle reducing inventory levels improving patient registration accuracy improving employee retention The focus has been on the improvement of clinical processes to identify and eliminate waste from the patient pathways, to enable staff to examine their own workplace, and to increase quality, safety and efficiency in processes (e. g. Fillingham, 2007 Silvester et al, 2004 Radnor and Boaden, 2008).The barriers specific to the deployment of Lean Six Sigma in health care, in addendum to the ones commonly present in other industries, are ? Measurement it is often difficult to identify processes, which can be measured in name of defects (Lanham and Maxson-Cooper, 2003). www. intechopen. com 12 ? Adva nced Topics in Applied Operations Management psychological science of the workforce in the health-care industry it is particularly important to not use jargonistic business language, as this has a high chance of being jilted or accepted with cynicism by medical professionalsThe application of Lean Six Sigma in health care is still in its early stages. whence early successes in simple projects will pave the way for tackling more complicated initiatives in the future, initiating a positive circle of improvement, bringing clinical change on a broad scale. Appropriately implemented, Lean Six Sigma can produce benefits in terms of better operational efficiency, cost-effectiveness and higher process quality (Taner et al, 2007), as the event studies presented in this paper illustrate.The spiralling costs of health care means that unless health-care processes become more efficient, a change magnitude proportion of citizens in industrialized societies will be able to cave in high-qualit y health care (de Koning et al, 2006). Continuous process improvement is needed to ensure health-care processes are efficient, cost-effective and of high quality. The five study study applications we have examined in this paper provide examples of how Lean Six Sigma can help to improve health-care processes.The adoption of similar programs in other hospitals across the health-care sector will help the delivery of high quality health care to an increasing population. 7. Conclusion Lean Six Sigma is now accepted widely as a business strategy to improve business gainfulness and achieve service excellence, and its use in service organizations is growing quickly. However, there are a number of barriers to the implementation of Lean Six Sigma in services, such as the innate characteristics of services, as well as the manufacturing origins of Lean Six Sigma that have conditioned service managers to consider them as fleshly products only.On the other hand, as shown in the compositors ca se studies, there are a number of advantages for the use of Lean Six Sigma in services (Eisenhower, 1999). Overall, the applications so far have showed the benefits (such as lowering operational costs, improving processes quality, increasing efficiency) to outweigh the costs associated with its implementation. 8. References Adams, C. , Gupta, P. & Wilson, C. (2003) Six Sigma deployment. Burlington, MA, Butterworth-Heinemann. Antony, J. 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Wheeler, D. J. & Lyday, R. W. (1990) Evaluating the measurement process. 2nd ed. SPC Press. Womack, J. P. & Jones, D. T. (1996) Lean thinking. New York, Simon & Schuster. Wyper, B. & Harrison, A. (2000) Deployment of Six Sigma methodology in human resource function a case study. get Quality Management, 11, (4/5/6), 720-727. Zeithaml, V.A. , Parasuraman, A. & Berry, L. L. (1985), Problems and strategies in services marketing, Journal of Marketing, 49 (Spring), 33-46. www. intechopen. com Advanced Topics in Applied Operations Management Edited by Mr. Yair Holtzman ISBN 978-953-51-0345-5 big(a) cover, 200 pages Publisher InTech Published online 16, March, 2012 Published in print translation March, 2012 The chapters in Advanced Topics in Applied Operations Management cr eatively demonstrate a valuable connection among operations strategy, operations management, operations research, and various departments, systems, and practices throughout an organization.The authors show how mathematical tools and process improvements can be applied effectively in unique measures to other functions. The book provides examples that illustrate the challenges confronting firms competing in todays demanding environment bridging the gap between theory and practice by analyzing real situations. How to reference In order to correctly reference this erudite work, feel free to copy and paste the following Alessandro Laureani (2012). Lean Six Sigma in the Service Industry, Advanced Topics in Applied Operations Management, Mr.Yair Holtzman (Ed. ), ISBN 978-953-51-0345-5, InTech, Available from http//www. intechopen. com/books/advanced-topics-in-applied-operations-managem ent/lean-six-sigma-in-theservice-industry InTech Europe University Campus STeP Ri Slavka Krautzeka 83/A 51000 Rijeka, Croatia Phone +385 (51) 770 447 Fax +385 (51) 686 166 www. intechopen. com InTech chinaware Unit 405, Office Block, Hotel Equatorial Shanghai No. 65, Yan An Road (West), Shanghai, 200040, China Phone +86-21-62489820 Fax +86-21-62489821
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