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LEAN | 3 Types of Problems | Green Belt 2.0® Lean Six Sigma | fkiQuality HD
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- čas přidán 14. 08. 2024
- Companies face 3 types of problems: financial, operational and procedural.
In many cases financial problems are best solved by fixing operations that increase cost or reduce revenue.
Fix operations with Lean Six Sigma by working on processes.
Timecodes:
0:36 - Intro
0:59 - Pyramid of Problems
1:30 - LSS is best at Operational Problems
1:41 - How Problems Begin
2:24 - A Business Solution for a Business Problem
3:05 - Ask if a Business Problem might be due to an Operational Issue
3:33 - Understand the "Voice of the Customer" & "Voice of the Process"
5:00 - Example of how to analyze with the Pyramid
5:45 - Personal Example involving Hotels
7:48 - How to solve the Personal Example?
8:03 - How LSS works summary (From the bottom up)
8:58 - Summary Slide
Thank you for a process that analyzes the business, operational, and procedural problem first instead of assuming employee error!
This is a good visual represenation to show non lean people where we can start to attach the problem.
Excellent visual representation, as a pyramid, showing how lean six sigma solves poor operations and/or
design, and thus improving the businesses financials.
The breakdown of the three types of problems as a pyramid was very helpful. It was easy to follow how the financial is a result of the lower levels and how the solution to the upper level comes from the bottom. The hotel example was also very helpful into understanding how this might be translated to the real world.
The pyramid makes complete sense. The concept really explains the reasons for starting at the bottom (the company core) and fixing problems there so improvements can trickle up the pyramid.
One of the points I liked in the video was identifying how focus on creating a positive voice from the customer experience balanced with the voice of the process have direct impact/correlation to business's bottom line.
I like the breakdown and explanation for each tier of the pyramid and showing the direction of analysis vs. solution. That makes complete sense that it builds on top of each other and directly correlates.
I really enjoyed your breakdown of the 3 types of problems. Simplified and impactful! Thank you for your presentation!
A very good overview of the three types of problems and where Lean Six Sigma can apply. I liked how the solution started with the procedural level.
A great overview of how companies can resolve problems they face at the business, operational and procedural level using Lean Six methods to solve operational level problems. Also interesting is the fact that the solutions to solve the poorly design and executed operation was solve from the bottom up.
I appreciated the breakdown of explaining the 3 different problems. How is this financially detrimental for the company, what are the actual problems and issues being encountered, and to then focus on the sustainability of the problem and paying attention to errors to course correct. I also found it interesting that the solution is bottom up instead of trickle down.
This is a very good chart/explanation to describe how to relate financial problems to operational problems. It also makes sense to start from the top of the chart (the money) and work your way down to see how this is related to the operations of the business.
Just like you said, the best answers come from the bottom up. The people doing the actual work know what's wrong way before anyone else does. The good companies constantly listen to the front lines.
I like the example of staying at a hotel with expectations not meeting the customer's expectations. I specifically remember a time when I had an unpleasant experience at a hotel. I had to move to three different rooms before one was finally acceptable. The first room had a broken thermostat, the second room wasn't cleaned systematically, and finally I was refunded my money and upgraded to a better room. I think an uncomplicated way for the hotel to avoid refunding the customer would be to implement a checklist for their employees to complete so there is a transparent process. Starting at the bottom of the pyramid and working up would've saved the hotel money, time, and customer loyalty.
Very interesting to realize how problems are interconnected and how lean six sigma can help solve operations and overall the problems of a company.
Thank you for explaining the 3 types of problems and the 3 solutions all made possible by analyses starting from the bottom and working to the top of the pyramid. Fix the processes that are not working, that will fix the problems in operations, ultimately fixing the financial issues. Brilliant!!
I really like how this video broke down the three different problem types and how process issues will lead to issues in operations stemming to the bigger picture of business issues.
I like the reiteration of the VOC and VOP when addressing, analyzing and fixing operation problems. Also very good reinforcement of the idea that while refunds and upgrades (like the inadequate/below expectation resort experience that Francisco gives) might alleviate an unhappy or unsatisfied customer in the short term ultimately the company A) is not addressing or fixing the problem/root cause(s) and, B) is losing money that would otherwise not need to be lost had the operation issue been addressed prior.
Enjoyed video. Learned that procedural and operational problems lead to business problems that are usually financial in nature.
I agree with focusing on fixing the operational issues of a company first and foremost and then all other issues will work themselves out. Great diagram of how to analyze the issues from the top down and the solution is from the bottom up.
I had no idea about the six sigma story, it was just a curiosity for me during several years.
Outstanding presentation! Congratulations and many thanks for planning carefully your ideas, and concepts: in detail, without redundancies, and focusing on the relevant issues. Clarity of ideas and the use of helpful illustrations, schemes etc is at the core of your successful presentation.
I compared your presentation with those of other people on the same topic, and frankly you are at the very top as an excellent speaker!
Good work, and thanks again! Muy bien, Pancho, saludos, Carlos
Thank you, Carlos. I appreciate your comments and look forward to catching up.
Great video, I agree. Most cases I have seen were operational issues were creating loss for the company. In the past I helped previous employer increase customer satisfaction scores while reducing overtime simply changing our operational standards for the communication of deliveries starting from internal through to the customer.
I have been involved in many projects that have only looked at the financial implications and not the operations/process. Its a very simple thing to do and it was explained very well. Thank you.
In LSS we say that to solve a financial problem you must solve the operational problem, because most often poor operational results lead to poor finances.
Sometimes there's the temptation to solve a financial problem with a financial solution, like "throwing more money or people at the problem. This seldom works.
Permanent change comes from the inside of the organization, from smooth, efficient internal workings.
Other change approaches produce outcomes that are cosmetic and short-lived.
Informative video. Drawing the diagram helps to understand the process easier.
I really liked this video...as I watched it I am (in my mind) applying it to the company I work for currently. BOY do we have problems! Putting this at the foot of leadership for the most part.
The concept makes sense. Correcting issues at the base, process level, improves all other functions.
Voice of the Customer &/or Voice of the Process is important to understanding the problems organizations face. Understanding the root provides the opportunity for improvement. Typically the problems are understood at the lower levels as they do the work day in an day out. Critical to success is providing the forum for raising concerns without fear.
It's interesting to see how lean six sigma is the core and what needs to be addressed in order to have sustainable solutions to problems that arise.
A good video, easy to understand. Thanks
Yes, I agree, solid and stable operations and procedures/processes are foundations to business success.
Very nicely done. Thank you!
Its interesting to see how the business problem can relate to the design problem and shows how important it is for different departments to work together
I agree fixing the operational aspect will have a substantial impact on the business
Your example of the resort sale falling short of the customer's expectations exemplifies the importance of drilling down to the VOC level to get to the root of the problem.
Just as the pyramid is supported by it's bottom levels, so is a company. If the solutions come from the lowest levels, the top business issues will be corrected, and supported.
Many business problems do have roots in Operations or Process. Therefore, it's clear that Operations and Process are very important to the overall performance of the business. It would be beneficial for firms to put more resources and attention into their Operations to help improve and prevent problems from arising.
Josh Klinzing yes, right? Operations is where the wealth of the company is made! Yet the most resources and prestige goes to finance or legal, which are but supporting functions.
Agreed. In addition, I find that Tech and Marketing, front-end-facing and revenue-generating areas, are the ones to get resources vs. the back-end cost centers. While that approach feels logical, it can be tough for those working in Operations. If we shift our perspective towards continuous improvement and are able to deliver results, though, that success feels makes our work feel less like a continuous battle.
I agree that fixing Operations by working on the processes is the key
The voice of the customer and the voice of the process are keys to be in-tune with, they will lead you to opportunities to fix operational problems
Ryan, yes, being able to link metrics at the business, customer, operations, andprocess levels is key to know what to work on and do it quickly. There's another technique for this called Quality Function Deployment of QFD. Francisco
Simple but helpful concept. Helps you see how issues at the foundation effect issues at the top.
The Pyramid describes the business relationship between the financials and operations. Organizations need to be willing to the do the analysis across all areas of the organization. This would take strong communication and understanding of all procedures from a high level to the lowest level.
We run into a combination of operational and procedural problems. We often do not look in detail enough to plan the jobs correctly and that leads us to operational difficulties. More communication between all levels of management are key to producing a product. But, the business also is a 'culprit'. Often they lower the cost of our estimate to get work in the door. Again, communication is key to success.
It makes sense that solving problems would start at the bottom or wherever the source of the problem starts. Operations drives the business.
Expands further on topics that we discussed In class. It is important to be attuned to the voice of the customer as you analyze the business problem. The goal through the lens of LSS is to find a solution at the root as a financial solution is usually stemmed from a operations problem or a procedural problem. The financial solution is likely just avoiding the tip of the iceberg and finding the deeper issue will be less costly or a more effective
Many companies today face problems beginning at the business level and filtering down into the lower operational and procedural levels. The instructor illustrates how important it is to apply lean six sigma concepts to solve operational level problems which will then lead to an upwards solution of the business level financial issues.
The description of the three types of problems and their relationship with one another in the pyramid structure make sense. Procedures are put together to establish operations that will then impact the overall business and relationship with the customer.
I have seen evidence of this bottom-up problem-solving approach having a significant impact on a business unit. It took a lot of effort and was difficult to unravel. In our case, the business problem was budget over-runs at the end of the year. When looking at operations it was due to unpaid invoices being overlooked until the end of the year when the department budget was already expended. This meant units had to request additional funds to pay vendors before year-end. Ultimately, there were some operational reports and alerts put in place to identify unpaid invoices and thresholds, but it was the related processes which needed to be improved. The processes used to accept, process and pay invoices were totally overhauled. This not only alleviated the year-end budget over-run issue but reduced the severity of business unit audit findings in relation to invoice payment timeframes.
Very good explanation, thanks
Balaji, you will be interested in the companion video here, czcams.com/video/gK09IZ2Cbhc/video.html
and other videos in the fkiQuality channel. Francisco
I have a better understanding on where to look for problems using lean six sigma. Looking at the operational makes sense after watching the video
Applying Lean Sigma Six menthods to operational - levels problems can create maximum impact to the business problems.
the three types of problems work for a company and usually upper management notices when financial problems occur, whether it is loss or not enough profit coming in. however if lower level employees are encouraged to participate and bring their concerns and suggestions to management the problems can be corrected before they reach the top level.
Understanding the underlying operations that create financial outcomes is essential to optimizing your processes in a way that results in better outcomes for the business.
Working on processes is key for operations
Many companies try to only fix business issues instead of trying to work there way from procedures to finding a solution.
Just as employees seem to over-produce, etc. and justify their actions, Companies seem to attempt to fix issues at the Business / Finance levels as a reflex before attempting to understand the underlying causes of their Business / Financial problems. I wonder if this reflex also stems from fear: fear of loss of revenue due to refunds, or fear of the changes it might require to truly address the cause of the problem, for example. Most enlightening...
I have seen this in the past in several facilities but never related it to a pyramid. Unfortunately in a lot of cases when they finally accepted there was a problem it was to late. A constant evaluation of the process is great if you stop the problem before it gets to the top its not as devastating.
Ethan, you're right, sometimes we become aware of problems too late. To accelerate this feedback and avoid escalating too much, watch the video The Inverted Pyramid here czcams.com/video/z30EWLlsb04/video.html
This is just another version of fixing the problem as close to the beginning of the process as possible. It is also understanding how problems propagate through a system, this system being a business.
Improving the process using six sigma tool impacts on the business performance and customer's perceptions
Domingo, yes, customer perception and business results may be impacted positively by connecting these levels. I once heard this stated in this way " fix a business problem by fixing the operational problem."
Business, Operational and Procedural problems. Business refunds, change the process to eliminate refunds. When problems are identified by financial it is important to also ask perhaps the issue is stemming from the process/procedure.
The top down gives a great idea of issues and where they occur. I do not agree that all the issues occur at the operational level. Sometimes we see business issue not correlated with operational and procedural items put in place t comply with compliance and regulatory items.
Ronald Tucci you are saying that in addition to business -driven problems there are also problems due to regulatory compliance? Can you give some examples? Thx.
Thought this video showed clearly why Operations is most impacted by Lean Six Sigma, and how business impacts typically drive operational changes. My question is if there are operational changes do they typically also trigger procedural changes and should those also be included under the Lean Six Sigma project?
Procedural changes ARE the way we improve operations. Operations are made of processes which may or may not be working well. Lean Six Sigma projects improve processes so they may work together to achieve a common objective.
If your operations is sub par it can and will affect business $ and process this must be examined in order for there to be change.
Simple theory, identifying and solving the operational problems that exist is the more difficult part.
So while in class you presented the pyramid you used different words. The processes (or procedures) were also examined to make improvements. I understand the need to look for root causes.
Explained very well.
While I agree that the process often works from the top(business) down, it is interesting that often the workers at the procedural level understand that there are problems at the bottom level that ultimately impact the business/financial level. In a way, it’s sad that these procedural level workers see these problems before they reach the business level and can’t, won’t, or aren’t empowered to make the changes before it becomes a business level problem. There is so much wate that occurs between the workers’ procedural level realization of the problem and when it is realized at the business/financial level.
Brad Hentz this is a sharp observation! Workers know first hand and quickly what's happening with operations every day. The problem is that they may not feel safe enough or important enough to speak up.
Deming is very strong in his criticism of the style of management that produces this passivity.
Toyotas response is autónomation principle also known as jidoka.
Joe Tshulos, its Like McDonalds. If the person understands the procedure and follows it, the operation of producing a Hamburg that looks and taste the same across the country. This is why Ray Kroc made and still makes Billions.
This video clarifies the fact that rectifying problems on the procedural level will correct problems on the business level.
Effective Lean Six Sigma requires a strategic approach that will involve the entire system from management level down to the procedural level.
Sometimes business owners see operations and process as a single entity. How do you get them to realize they are separate?
An operation performs a service needed for the functioning of a company, for instance, finance or logistics. Operations are made of multiple processes -- logistics may include receiving, shipping, storing, inspecting processes. In this way, operations are made of processes.
Someone may have a different classification, but what matters is that you be aware that to improve an operation you must analyze it at the process level, and improve the process to get higher operational performance.
This in turn will produce better financial or business-level results.
The video clearly explains that Lean Six Sigma methods best address operational issues and this typically involves procedural fixes.
A lot of problems can be solved if you apply this concept to get to the route of problems.
Jaime, you're right, I once heard this stated in this way " fix a business problem by fixing the operational problem."
A lot of people do not take quality serious at all which cause companies to lose contracts.
Management wanting to fix the problem is what will enable those arrows to go down and up in your diagram.
There's a management problem inherent in finding common understanding of how the problems inter-relate between different parts of the company and agreement on how best they can be solved.
Thanks! i am undestand better about lean six sigma!
You mentioned that 6 sigma is most powerful at the Operations level. It appears to me that 6 sigma involves working at both the operational and procedural levels in an integrated fashion. Would you please distinguish for me how the procedural and operational levels differ in 6 sigma and why one would be more powerful?
See comments above.
Lean Six Sigma can aid operations when working on processes
Video shows how the 3 types of problems are interrelated and focuses on Operational from Lean perspective
If we fix the problems from the processes and operations parts of the pyramid, it will help the business part of the pyramid.
That's right , Linda. I once heard this stated in this way " fix a business problem by fixing the operational problem."
Clearly in the example given if business pay more attention to VOCs and VOP they could fix the issues more quickly eliminating the need for discounts or lost revenues from not being able to sell the upgraded rooms. adjustments would not be needed and hence no financial impact. Looks like it boils down to poor marketing
I've seen too many examples of leadership who think they know how to fix problems without knowing the operations or the procedures. This leads to many downstream problems which are not often discovered till it's too late in the process which inevitably costs the company more money.
Many financial problems are actually operational problems, which can be solved via Six Signa.
Fix your ops and the rest will follow
it like the domino effect