Improvement Project Charter Spell-check Sheet Making It Stick: A Four-Step Process for Creating Sustainable Change

Making It Stick: A Four-Step Process for Creating Sustainable Change ASQ Lean & Six Sigma Conference March 1, 2011 Company LOGO

You will learn…  Practical how-to’s for implementing the four essential elements for creating lasting change.  The role key performance indicators play in keeping the organization focused on results.  The characteristics, roles and responsibilities of effective process owners.  How to help leadership understand that, to achieve an adequate return on investment and create sustainable change, improvement must follow a disciplined process.  How your improvement process creates culture, not the other way around. © 2011 Karen Martin & Associates 2

Making ^ improvement is 80% psychology and 20% tools. 20% 80% 3

Improvement via PDCA Cycle • Create charter • Scope effort • Form team • Discover • Design, test, implement • Create sustainability plan • Train staff Plan Act • Adjust process as needed • Continuously improve Do Check • Monitor process performance • Conduct regular process audits 5

“Plan” Sustainability Checklist □ The improvement area of focus is closely aligned with the organization’s business goals. □ A detailed charter has been developed, agreed to and widely distributed (including clear drivers why the improvement is needed, what the target state looks like, project scope, etc.) □ The project manager and/or improvement facilitator are highly skilled in improvement psychology, problem-solving and a wide range of improvement tools. □ An engaged executive sponsor is supporting the improvement. □ A highly cross-functional project team has been formed, heavily weighted with the people who use the process. © 2011 Karen Martin & Associates 7

You need an improvement strategy that’s aligned with overarching business goals 9

Risks If No Clear Improvement Strategy Exists You’ll spend limited resources (time, people, money) on lower priority issues. More difficult to establish a sense of urgency. Sub-optimization. Introducing more chaos into an already chaotic system. More difficult to measure success. More difficult for improvement professionals to prove their worth. © 2011 Karen Martin & Associates 10

One Option - Hoshin Kanri X-Matrix 11

“Plan” Sustainability Checklist □ The improvement area of focus is closely aligned with the organization’s business goals. □ A detailed charter has been developed, agreed to and widely distributed (including clear drivers why the improvement is needed, what the target state looks like, project scope, etc.) □ The project manager and/or improvement facilitator are highly skilled in improvement psychology, problem-solving and a wide range of improvement tools. □ An engaged executive sponsor is supporting the improvement. □ A highly cross-functional project team has been formed, heavily weighted with the people who use the process. © 2011 Karen Martin & Associates 12

Improvement Project Charter Spell-check Sheet Project or Event Scope Leadership Value Stream Dates Value Stream Champion Start & End Times Specific Conditions Facilitator or Project Manager Improvement Charter Project or Event Scope First Step Value Stream Champion Facilitator or Project Manager Process Trigger Start & End Times Last Step Improvement Drivers / Current State Issues 2 3 4 5 Improvement Drivers / Current State Issues 3 4 5 Improvement Goals and Objectives 1 2 Improvement Goals and Objectives 3 1 2 5 3 1 4 5 1 Planned Deliverables 5 6 7 5 8 9 10 7 4 Additional Support / Subject Matter Experts Function 2 3 5 4 Function Executive Sponsor 4 4 2 Signature: Date: Project Manager Signature: Date: Signature: Date: 4 Potential Obstacles 1 Name Facilitator / © 2010, 2007 Karen Martin and Mike Osterling 3 5 Value Stream Champion 1 3 3 Additional Support / Subject Matter Experts Approvals Potential Obstacles 1 2 Name 1 10 2 Name 4 4 3 1 Name 3 3 9 Planned Deliverables CoreFinal BriefingMembers Team Core Team Members 2 2 8 2 Final Briefing 1 6 4 Workforce Training Function Function 1 Use data to establish a sense of urgency Interim Briefings Administrative Support Event Boundaries & Limitations Workforce Training Location Administrative Team Lead Support First Step Interim Briefings Dates Specific Conditions 2 Meeting Schedule Executive Sponsor Team Lead Event Name Event Boundaries & Limitations Location Leadership Value Stream Last Step 1 Meeting Schedule Executive Sponsor Event Name Process Trigger License Agreement Approvals Executive Sponsor Value Stream Champion Facilitator / Project Manager 2 3 4 Signature: Date: Signature: Date: Signature: Date: © 2010, 2007 Karen Martin and Mike Osterling 14

Improvement Project Charter Project Definition Project Sponsor & Team Value Stream Key Milestones / Due Dates Current State Analysis Executive Sponsor Project Team Process / Area Member Manager Root Cause Analysis Team Lead Demand / Volume Trigger Future State Design Additional Members First Step Last Step Test / Pilot Complete Specific Conditions (includes/excludes) Implementation Complete Team Meetings Dates & Times Potential Barriers to Success Project Drivers / Current State Issues Results Validated Cross-Functional Involvement Function / Role 1 2 3 Involvement 2 4 Name 1 3 5 4 Improvement - Benefits to Customers / Company / Staff 5 1 6 2 7 3 8 4 5 9 10 Improvement Goals Measurable Objectives Baseline / Current State 1 2 3 3 5 Proj % Improve. 2 4 Desired State 1 4 6 5 Approvals Executive Sponsor Initials: Date: Results Validation - Planned Method & Accountability Team Lead Initials: Date: Project Coach Initials: Date: 15

“Plan” Sustainability Checklist □ The improvement area of focus is closely aligned with the organization’s business goals. □ A detailed charter has been developed, agreed to and widely distributed (including clear drivers why the improvement is needed, what the target state looks like, project scope, etc.). □ The project manager and/or improvement facilitator are highly skilled in improvement psychology, problem-solving and a wide range of improvement tools. □ An engaged executive sponsor is supporting the improvement. □ A highly cross-functional project team has been formed, heavily weighted with the people who use the process. © 2011 Karen Martin & Associates 17

The Role of Executive Sponsors If it’s not important to leadership, why should frontlines care? You may have to teach / coach your leaders re: their role in the improvement process.   They need to be present for kick-offs and briefings. Ask the right questions to assure the improvement’s “on track.” Don’t wait for the exec sponsor to ask for an update.  Schedule briefings in advance. © 2011 Karen Martin & Associates 18

“Plan” Sustainability Checklist □ The improvement area of focus is closely aligned with the organization’s business goals. □ A detailed charter has been developed, agreed to and widely distributed (including clear drivers why the improvement is needed, what the target state looks like, project scope, etc.). □ The project manager and/or improvement facilitator are highly skilled in improvement psychology, problem-solving and a wide range of improvement tools. □ An engaged executive sponsor is supporting the improvement. □ A highly cross-functional project team has been formed, heavily weighted with the people who use the process. © 2011 Karen Martin & Associates 19

Common Team Weaknesses  Teams thrown together without enough strategic thought.  Teams too large – 10 max; 12 on rare occasions  Too many supervisory staff; not enough frontline representation.  The improvement must be designed, tested and implemented jointly by the people who actually work the process!  Missing internal customers and suppliers.  The “users” must have a very strong voice.  Missing functions.  Team is “advisory” rather than actively engaged in making the improvement.  Facilitator’s role isn’t to “do” – it’s to LEAD, teach, manage. © 2011 Karen Martin & Associates 20

Improvement sustainability is highly dependent on the levels of engagement of those most affected by the change. It’s uplifting to kaizen. It’s traumatizing to be kaizen’d. 21

“Do” Sustainability Checklist □ The current state is deeply understood, including root causes. □ Input and consensus has been obtained from the larger user group throughout the improvement process. □ The countermeasures have been tested thoroughly. □ The countermeasures are “user friendly.” □ 2-5 relevant key performance indicators are used to consistently monitor process performance. □ The new process has been documented. □ Process suppliers, “do-ers” and customers have been properly trained. □ A process owner has been designated. © 2011 Karen Martin & Associates 24

Establishing Key Performance Indicators What problem(s) are we trying to prevent from recurring? What’s the best measure of success? How frequently should the process be measured? Who will analyze the data? Aim for as many “leading indicators” (vs. lagging) as possible. Heavily operational in nature, but can also include financial, customer-focused, and staff-focused measures. Post & discuss the results! © 2011 Karen Martin & Associates 26

Process Management & Improvement KPI Target Result Actual Result Root Cause Corrective Action Taken New Result Target Result Actual Result Root Cause Corrective Action Taken New Result Modified order form to reduce errors 3.8 hrs N/A N/A KPI-1 KPI-2 KPI-3 KPI-4 KPI-5 KPI Turnaround 4.0 hrs 6.2 hrs Errors on incoming orders Output errors 2% 1% N/A 27

Sample Visual KPI – Quality Scores TA NQR - KPIs 5 TA NQR Ratings 4 3.8 3.7 3.6 3.3 3 3.6 3.9 4.0 3.7 3.3 NQR Target TA Actual 2.7 NQR Benchmark 2 1 FY10 Q3 A3 began FY10-Q4 FY11-Q1 FY11-Q2 FY11-Q3 FY11-Q4 FT Quarters 28

KPIs - Visual Display 29

KPIs – Visual Display (close-up) 30

Flat screens used to display relevant KPIs 31

“Do” Sustainability Checklist □ The current state is deeply understood, including root causes. □ Input and consensus has been obtained from the larger user group throughout the improvement process. □ The solutions have been tested thoroughly. □ The solutions are “user friendly.” □ 2-5 relevant key performance indicators are used to consistently monitor process performance; they are posted. □ The new process has been documented. □ Process suppliers, “do-ers” and customers have been properly trained. □ A process owner has been designated. © 2011 Karen Martin & Associates 32

Process Ownership Why?  Processes do not typically “self-manage.”  Focus and discipline are needed.  When everyone’s responsible, no one’s responsible. What?    Responsible for process performance at a tactical level. Oversees measurement, reporting & continuous improvement. Has authority for process monitoring and improvement across all functional areas.  Obligated to include all appropriate parties in ongoing problemsolving and continuous improvement. © 2011 Karen Martin & Associates 33

Process Ownership (continued) Who?  A sole person (with designated back-up for vacation coverage, etc.) at a manager level or below.  Typically resides in the functional area with the greatest “skin in the game” across the process.  Should NOT be a dedicated improvement professional.  Director or above assures process owner is managing process appropriately, provides support (mentoring and resources), and aids in removing obstacles to success. © 2011 Karen Martin & Associates 34

Process Owner ≈ Process Doctor • Diagnose condition Plan Act • Modify treatment as needed Do • Consider treatment options • Provide treatment Check • Monitor condition 35

“Check” Sustainability Checklist The process owner: □ Reviews, communicates, and posts the KPIs as scheduled. □ Leads work group “status” meetings (brief!) where the KPIs are posted to discuss trends, create strategies for responding to changing conditions, brainstorm solutions to new problems, etc. □ Schedules and leads root cause analysis activities immediately when the KPIs are not met. □ Leads or arranges for the process to be audited at regularly scheduled periods (annually, at a minimum) to test for “robustness” and identify opportunities for further improvement. □ Talks with process workers to assess the need for additional training, revised standard work, etc. □ Assures the process is being followed and, if not, determines why. © 2011 Karen Martin & Associates 38

“Act” Sustainability Checklist □ The process owner organizes and/or leads continuous improvement activities via engaging all relevant parties (from simple process “tweaks” to significant overhauls). And the PDCA cycle begins again… © 2011 Karen Martin & Associates 40

So how do you get improvement to “stick”? Create a clear improvement strategy that creates alignment between improvement effort and the organization’s business goals. Involve the right people. Use a robust process to create the improvement. Use a robust process to sustain the improvement.  It takes consistent and focused attention or it won’t happen. © 2011 Karen Martin & Associates 41

What Doesn’t Typically Sustain? When the process is merely “changed” (process tampering) vs. truly improved. When the new process makes the work more difficult.  …after excellent training and adequate time for learning curves. When the workforce isn’t fully engaged in the process. When the process isn’t monitored consistently and continuously improved. © 2011 Karen Martin & Associates 42

In Conclusion The process you use to make improvement will shift culture faster than any amount of workforce training, leadership hype, or facilitator development you can possibly engage in. © 2011 Karen Martin & Associates 43

Sustainability Plan Sample Sustainability Plan Executive Sponsor Value Stream Champion Facilitator Team Lead 30-Day Audit Date Event Name Event Dates "Go Live" Date "Go Live" Location 60-Day Audit Date Communication / Training Requirement Plan Provide training for those who missed initial training. Who will deliver it and when? Integrate new process into ongoing department training. Who leads identification of training that need to be updated (ongoing and for new employees), when will training be in place? Update Value Stream Map. Which value stream map(s) need to updated, who will do it and when? Update training records to reflect who has been trained. Who maintains training records? Communicate to affected parties who were not advised Who communicates? How? To whom? during event. The Kaizen Event Planner, Martin & Osterling Post the Event Report, 30-Day List, Sustainability Plan. Who is accountable? Where posted? Update SOPs and other ISO or regulatory documents impacted by changes. Who identifies relevant documentation? Who updates it? By when? Communicate and post 30-day and 60-day audit results. Who communicates? How? To whom? Where posted? Communicate audit results to stakeholders and leadership team. Who communicates? Via what medium? Communicate process performance measurement plan. How is process performance going to be communicated to workers? Are additional visuals needed? Who owns this activity?

Monitoring / Measurement Requirement Identify process owner. Sample Sustainability Plan Plan Who has ultimate responsibility for how process is performing? Observe process one day after event is over. Talk with Which Kaizen team member(s) will observe the process? How will they workers, assure they understand how process should communicate results? Who is responsible for adjusting the process, if needed? be performed; see if there are problems. The Kaizen Event Planner, Martin & Osterling Who is responsible for finalizing process performance metrics and by when? Observe process one week after event is over. Talk with workers, assure they understand how process should be performed; see if there are problems. Which team member(s) will observe the process? When? How will they communicate results? Who is responsible for adjusting the process, if needed? Define corrective actions required if new process not being followed (rewards and consequences). Will there be rewards / recognition for sustaining improvements? What will corrective actions be if workers are not following new process? Who will enforce these rewards/consequences? Monitor process performance frequently; post results put continuous improvement plans in place. (p. 2) Put in place key metrics to measure process performance; post performance. Who monitors process performance on an ongoing basis? Who communicates the results? When, to whom, in what format? Conduct 30-day audit. Who will lead audit & when? How will results be communicated? To whom? How will the process be adjusted, if needed? What's the plan for continuous improvement? Conduct 60-day audit. Who will lead audit & when? How will results be communicated? To whom? How will the process be adjusted, if needed? What's the plan for continuous improvement? Value Stream Champion Process Owner Name Name Signature Signature Date Date

You will learn…  Practical how-to’s for implementing the four essential elements for creating lasting change.  The role key performance indicators play in keeping the organization focused on results.  The characteristics, roles and responsibilities of effective process owners.  How to help leadership understand that, to achieve an adequate return on investment and create sustainable change, improvement must follow a disciplined process.  How your improvement process creates culture, not the other way around. © 2011 Karen Martin & Associates 46

For Further Questions 7770 Regents Road #635 San Diego, CA 92122 858.677.6799 ksm@ksmartin.com Free monthly newsletter: www.ksmartin.com/subscribe Learn / Connect : 47

It’s about how people FEEL about their work… 48

Improvement Project Charter Spell-check Sheet Making It Stick: A Four-Step Process for Creating Sustainable Change

TKMG, Inc.

Improvement Project Charter Spell-check Sheet