PROCESS IMPROVEMENT

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DCE5131 QUALITY IMPROVEMENT IN HUMAN RESOURCE
DEVELOPMENT
PROCESS IMPROVEMENT

PREPARED BY Assoc. Prof. Dr. Jegak Uli
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OBJECTIVES
1. Process and process focused strategy 2.
Process characteristics 3. Concepts of process
management 4. Six ingredients that are essential
for managing any type of process 5. Identify and
manage key processes 6. Strategies for process
improvement? 7. Flow chart
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INTRODUCTION

• An input-output phenomenon
• Input resources output products by
  products

Figure 1 Fundamental Product Process Relationship
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WORK PROCES

• A process is defined as the sequential
  integration of people, materials, methods, and
  machine in an environment to produce added
  outputs for customers. A process convert
  measurable inputs into measurable outputs through
  an organized sequence of steps. Four group or
  people are involved in the operation and
  improvement of processes (Tenner and DeToro,
  1994)
• Customers the people for whom the output is
  being produced
• Work group the people who work in the process
  to produce and deliver the desired output
• Supplier the people who provide input to the
  work process
• Owner the person who is responsible for the
  operation of the process and for its improvement

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INTRODUCTION

• Two general types of strategies exist for
  creating products that meet or exceed customer
  needs and expectations (1) process focused or
  (2) product focused.
• Process focus how we design and build our
  products (i.e., how we combine inputs and
  processes).
• Product focus what we design and build.
• Concern and formulate strategies for both
  process and product.

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PROCESS

• PROCESS A bound set of interrelated work
  activities, each having prescribed inputs and
  outputs.
• Can be material, equipment, other tangible
  objects, or various kinds of information, are
  converted by a series of activities into an
  output provided to a recipient.
• RECIPIENT
• -gt can be either an external or internal
  customer.
• -gt An external customer is a person or
  organization that pays for the service or
  products received. An internal customer can be
  a department, a group (in case of an internal
  operation), or some other processing
  equipment and machinery.
• -gt can be a location where the process's outputs
  are stored for future use (e.g, a warehouse).

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PROCESS
Figure 2 A simple process

• Processes typically cut across functional
  boundaries in an organization
• This simplified definition of a process needs
  expansion

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CROSS FUNCTIONAL PROCESS

• ENGINEERING

• MANUFACTURING

New Product Development
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PROCESS

• According to Melan (1993), a process can be
  defined by its four key functions
• 1. Endpoints
• 2. Transformations
• 3. Feedback
• 4. Repeatability
• 1.Endpoints
• defined as its inputs and outputs.
• endpoints categories
• a. Inputs
• b. Outputs
• c. Customers
• d. Catalyst event

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PROCESS

• INPUTS
• can be equipment, materials, methods, or the
  environment.
• OUTPUTS
• products or services.
• CUSTOMERS
• users of the products or services.
• can be either internal or external to the
  organization.
• the ultimate judges of the quality of the process
  outputs.
• the primary customer is the most important
  customer for any
  product or service.
• CATALYST EVENT
• can be classified as an input as well as an
  independent endpoint.
• the single event that signals the beginning of
  the process.
• it establishes the initial boundary of the
  process.

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PROCESS

• 2. Transformations
• Can be classified into three categories.
• Physical
• Locational
• Transactional
• Physical transformation
• changes some tangible item, such as raw or
  semi-finished material, into another state. E.g.
  act of melting down pellets and injecting the
  melted plastic into a mold.
• Locational transformation
• also changes physical items.
• it changes the location of objects or materials
  and does not change the materials in any other
  physical manner. E.g.the movement of plastic
  pellets from the warehouse to the shop floor or
  the movement of the final product from the shop
  floor into the storage or shipping area.

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PROCESS

• Transactional transformation
• involves the modification of nontangible items.
• these items include the electronic movement of
  money in banks, the sales of stock by
  stockbrokers, or the assembly of marketing
  research data by advertisers.
• the primary input item is information or data.
• the transformation process could involve the
  modification of data.

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PROCESS

• 3. Feedback
• involve communication and evaluation channels by
  which the transformation activities are modified,
  or corrected, to maintain the desired attributes
  of the output.
• every process requires feedback to regulate its
  output.
• feedback can take many forms.
• it can occur as information from the output side
  of the process or from check - points inside the
  conversion processes. Feedback can also take the
  form of economic information, such as gross sales
  revenue, which is used to evaluate the operation.

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PROCESS

• Feedback ensures that the process is effective,
  efficient, and achieving its desired output.
• Feedback can be divided into five categories.
• a. Customer needs and expectations
• b. Specific customer targets
• c. The voice of the customer
• d. Specific process targets
• e. The voice of the process
• involve information from the output of the
  process.
• involve information from within the process.

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PROCESS

• 4. Repeatability
• a process is or can be executed regularly in the
  same manner with the same output.
• Some processes are continuous, while others
  operate cyclically or intermittently.
• The process of assembling cars on a production
  line is a continuous process.
• Building custom cabinets for new houses is an
  intermittent process.
• But, whether a process is continuous or
  intermittent, it must be repeatable.

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PROCESS CHARACTERISTICS
Whether a process involves transformations of
a physical, locational, or transactional nature,
it has 10 common characteristics. 1. Clearly
defined ownership 2. Boundaries 3.
Capacity 4. Documentation 5. Control points
6. Effectiveness 7. Efficiency 8.
Adaptability 9. Measurements 10. Corrective
action-An input-output phenomenon
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PROCESS CHARACTERISTICS

• 1. Clearly defined ownership
• Traditionally, the ownership of physical and
  locational processes has been clear and
  explicit.
• The process owner was the departmental manager.
• Understood the organizational mission and the
  process's output had personal responsibility
  and accountability for the process and its
  output.
• The manager's performance was judged by
  quantifiable standards, such as cost, schedule,
  and quality.
• Recently, process ownership has gradually
  shifted toward empowered work groups and
  self-directed work teams.

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PROCESS CHARACTERISTICS

• and in these teams, employees are assuming some
  traditional roles of management.
• the basic ideas remain the same.
• the process owner, whether an individual or a
  team, is responsible for yield, cost, quality,
  and schedule.
• the process owner must manage the process to the
  targets set on this standard.
• the process owner has the authority to change the
  process to maintain its desired outputs.

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PROCESS CHARACTERISTICS

• Boundaries
• Boundaries are the beginning and end of a
  process.
• Physical and locational processes have clearly
  defined boundaries.
• The final output from and the input(s) required
  by these processes are clear and unambiguous.
• However, the boundaries of transactional
  processes are harder to identify.
• Further, output specifications for transactional
  processes may not truly reflect customer
  requirements, and input specifications may not
  achieve the desired output specifications with
  the existing processes.

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PROCESS CHARACTERISTICS

• A lack of understanding about the input
  specifications and the output specifications is
  common in many business processes.
• But in a well-managed transactional process,
  specification problems are minimized through
  conscious effort aimed at classifying the work
  product as it proceeds from one operation to
  another.
• Thus, the boundaries of a well-managed process
  are well-defined and controlled.

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PROCESS CHARACTERISTICS

• 3. Capacity
• Capacity is the output rate of the process.
• Capacity is usually expressed in terms of design,
  or theoretical, capacity and effective capacity.
• Thus, design capacity is stated without
  consideration for such matters as equipment
  reliability, maintenance, or personnel factors
  such as learning curves, absenteeism, illness,
  and so on.
• These considerations, when allowed for, enable
  effective capacity to be calculated.

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PROCESS CHARACTERISTICS

• 4. Documentation
• A detailed record of work flow in processes.
• Can be written in great detail, or it can be a
  collection of various bits of data.
• Provides a permanent record of the physical
  transformation taking place in a production
  process.
• Provides a reference point from which the
  repeatability of a process can be measured, and
  it provides a baseline from which any changes can
  be measured.

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PROCESS CHARACTERISTICS

• Serves as both a training and reference aid
  for the
• personnel involved in the process.
• Typical documents include process flowcharts,
  assembly drawings, and
  routings.
• Process flowcharts graphically describe the
  sequence of operations in the process.
• Assembly drawings show how a product is
• constructed.
• Routings describe operational steps that
  accompany the process flowchart.

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PROCESS CHARACTERISTICS

• 5. Control points
• Regulate the quality of work or provide
  feedback.
• Established to manage the natural variation
  that
• occurs in physical processes.
• 6. Effectiveness
• It measures feedback against process goals.
• Effectiveness is best assessed by measurement,
  
• both internal and external.
• External effectiveness measures must reflect
• customer requirements.
• Internal effectiveness measurements must
  reflect
• both external and internal customer
  requirements.
• It should proceed from the external boundary
  to the
• starting boundary of the process.

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PROCESS CHARACTERISTICS

• Integrated flow diagrams that reflect established
  requirements are useful for measuring
  effectiveness.
• Ineffectiveness is often easier to identify than
  effectiveness.
• These are some symptoms that suggest an
  ineffective process.
• - Customer complaints
• - Inconsistent output quality
• - Lack of awareness of output quality
• - Absence of a corrective-action system
• - Lack of interest in the customer
• - Long response times in correcting problems

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PROCESS CHARACTERISTICS

• Efficiency
• A measure of the output against the resources
  required to achieve that output.
• It reflects how productive the internal
  operations are and how effectively resources are
  used in the process.
• A traditional measure of efficiency is the ratio
  of output to the capacity of a process.
• Inefficiency is easier to identify than
  efficiency.
• These are some symptoms of inefficiency.
• - Multiple off-line inspections
• - Redundant, unnecessary, or nonvalue-added
  activities
• - Corrective actions such as rework and
  reconciliation
• - Supplier problems (e.g poor quality or
  late deliveries)
• - Excessive costs of value-added activities
  (E.g high
• production costs)

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PROCESS CHARACTERISTICS

• 8. Adaptability
• The ability of the process to adjust to change -
  either technological or output changes.
• A process responses to changing conditions such
  as output requirements, internal constraints, and
  input quality.
• A process is adaptable if it can be changed to
  meet new requirements without significant
  modifications.
• May require some work flow, personnel, and
  equipment changes when a process change is
  needed, but the process should remain largely
  intact.
• Processes that lack adaptability tend to be
  limited in
• nature equipment capability (capacity,
  throughput, cycle times) or human aspects
  (skills, flexibility,
• resistance to change other human factors).

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PROCESS CHARACTERISTICS

• Measurements
• A statistical basis for controlling the flow of
  work and managing variation _at_ provide a basis for
  feedback.
• Continuous measurements are inherent in any well-
  managed process (meet specifications).
• Process adapt to the natural variations that
  occur.
• Relied only on end-of-line measurements, or final
  quality controls approach costly in terms of
  scrap and rework.
• Statistical techniques e.g Pareto analysis and
  variation charts, are useful for managing
  repetitive operations.
• Need to measure products against the requirements
  of the process without removing the product from
  the process.

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PROCESS CHARACTERISTICS

• 10. Corrective Action
• The action required to correct for natural
  variation in a process.
• Internal feedback from measurements at one or
  more control points identifies the need for
  corrective action before subquality products are
  produced.
• This process is quickly adjusted to correct for
  the variations and the processs effectiveness
  and efficiency do not suffer despite the natural
  variations.
• Feedback and corrective action are the heart of
  prpocess control, without them the process loses
  its repeatability, quality and consistency.

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ANOTHER VIEW

• A process can also be categorized by its
  operatinonal environment 2 categories of
  operating environment are manufacturing and
  service organizations. Both use the same three
  transformation types but service process have 5
  features that distinguish them from manufacturing
  processes (Lowenthal, 1994)
• i. Degree of customer contact vary in degree
  of customer contact. Contact ranges from
  virtually none eg life insurance process to
  complete contact eg. Dental treatment. In
  contrast traditional manufacturing processes
  have little or no contact with customer.
• ii. Intangibility cannot be touch or felt by
  customer.
• iii.Immediacy the catalyst event of a service
  organization process occurs at the point of
  customer contact

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ANOTHER VIEW

• iv. Nonaccumulation since service is an
  experience rather than a product, output from
  service processes cannot be accumulated or
  inventoried
• v. Labor intensiveness service processes are
  accomplished by a wide range of people, capital,
  and automation. Tend to be more labor intensive
  such as legal, retail hotel and hospital
  services.

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PROCESS CHARACTERISTICS
Table 1 Differences between service and
manufacturing processes
Characteristic Service Manufacturing
Ownership Tends to be ambiguous or has multiple owners Usually clearly defined
Boundaries Often unclear, fuzzy Clearly defined
Control points Often nonexistent Clearly established and defined
Measurement Often nonexistent, hard to define Easy to define and manage
Corrective action Usually done reactively Performed during and external to the process

• Both manufacturing and service processes
  contain the
• 10 characteristics outlined.
• Thoroughness and attention paid to these 10
  characteristics vary
• depending on the environment.

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PROCESS MANAGEMENT

• Pall (1987) identifies six ingredients that are
  essential for process management
• Ownership Assign responsibility for the design,
• operation, and improvement of the process.
• 2. Planning Establish a structured and
  disciplined
• approach to understand, define, and document
  all
• major components in the process and their
• interrelationships.
• 3. Control Assure effectiveness all outputs are
  predictable
• and consistent with the customers'
  expectations.
• Measurement Map performance attributes to
  customers'requirements, and establish criteria
  for the accuracy,
• precision, and frequency of data acquisition.
• 5. Improvement Increase effectiveness of the
  process by
• permanently embedding identified
  improvements.
• 6. Optimization Increase efficiency and
  productivity by
• permanently embedding identified improvements.

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PROCESS MANAGEMENT
Table 2 Process Management Model (Tenner and De
Torro, 1994)
1 Identify key processes impacting on success (core business processes)
2 Assign ownership
3 Plan approach to define and document process (with the aid of a flow chart)
4 Measure performance against customers expectations (feedbacks)
5 Control process to assure predictable performance
6 Improve capability of the processes to meet customers expectations
7 Optimize efficiency and productivity
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PROCESS IMPROVEMENT

• People involved in the operation and improvement
  of processes
• Customers the people (or person) for whom the
• output (product or service) is being
  produced. The
• people who will use the output directly or
  who will
• take it as input into their work process.
• 2. Work group the people (or person) who work in
  the
• process to produce and deliver the desired
  output.
• 3. Supplier the people (or person) who provide
  input to
• the work process. The people in the process
  are in
• fact the customers of the supplier.
• 4. Owner the person who is responsible for the
• operation of the process and for its
  improvement.

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IDENTIFYING KEY PROCESSES FOR IMPROVEMENT
PROCESS IMPROVEMENT

• Six questions by Geary Rummler Alan Brache
  (1988)
• Which products and services are most important to
  the customers?
• What are the processes that produce these
  products and services?
• What are the key ingredients that stimulate
  action in the organization, and what are the
  processes that convert these stimuli to outputs?
• Which processes have the highest visibility with
  customers?
• Which processes have the greatest impact on
  customer-driven performance standards?
• Which processes do performance data or common
  sense suggest have the greatest potential for
  improvement?

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PROCESS IMPROVEMENT STRATEGIES
PROCESS IMPROVEMENT

• Three different approaches for improving the
  efficiency or effectiveness of a process
• Continuous improvement -a ladder, step by step
  approach, also known as Kaizen.
• Benchmarking - search for and emulate the best
  available practices and processes.
• Reengineering - the fundamental rethinking and
  radical redesign of business processes to achieve
  dramatic improvements

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Process Improvement Strategies. Source Adapted
from T. McCabe, The Quality Network, 1993.
PROCESS IMPROVEMENT
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Process Improvement Analysis Hierarchy
TECHNIQUES FOR PROCESS IMPROVEMENT
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TECHNIQUES FOR PROCESS IMPROVEMENT

• 1. Elimination - eliminate non-value-added
  activities. Instead of totally eliminate, replace
  the functional essence of the activity with a
  superior technology.
• 2. Combination - combine activities in order to
  extract process improvement.
• 3. Change of sequence - examine the sequence to
  see if a reordering will provide improvement.
• 4. Simplification - examine activities with the
  expectation of improvement through simplifying
  the activities themselves.
• 5. Addition If processes are clearly
  ineffective, need to add a process step but
  additions are our last resort.

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Process Improvement Model
SIX STEPS TO PROCESS IMPROVEMENT
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Step 1 Define the problem
SIX STEPS TO PROCESS IMPROVEMENT

• 1. Identify the output.
• 2. Identify the customers.
• 3. Define the customers' requirements.
• 4. Identify the processes producing these
  outputs.
• 5. Identify the owner(s) of the processes

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Defining the Problem in the context of the
process - example
Objective defined in terms of a specific results Restated in the context of the process Incremental process Improvement realized
Select and train 4 additional operators to support increased calls to computer users help line Improve systems to support computer users Annual opinion survey showed 15 improvement in employees views of computer support and no operators were added
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Step 2 Identify and document the process
SIX STEPS TO PROCESS IMPROVEMENT

• Flowchart
• commonly used tool for describing processes.
• enables to perform four following improvement
  activities
• Identify the participants in the process, either
  by name, by position, or by organization.
• Provide all participants in the process with a
  common understanding both of all steps in the
  process and of their individual roles.
• Identify inefficient, wasteful, and redundant
  steps.
• Offer a framework for defining process
  measurements.

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Step 3 Measure Performance
SIX STEPS TO PROCESS IMPROVEMENT

• The concepts of measuring performance at three
  level process, output and outcome
• Process define activities, variables and
  operations of the work process itself
• Output define specific features, values and
  attribute of each product all service
• Outcome define the ultimate impact of the
  process and are dependent on what the customer
  does with the product or service (customer
  satisfaction)

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Step 4 Understand Why
SIX STEPS TO PROCESS IMPROVEMENT

• Offer methods to acquire the next level of
  knowledge and to gain profound understanding of
  the process
• Never have so many
• worked so hard
• To accomplish so little
• 1. Have we distinguished the vital few from the
• trivial many?
• 2. Have diagnosed the root cause?
• 3. Do we understand the sources of variation?

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Step 5 Develop and Test Ideas
SIX STEPS TO PROCESS IMPROVEMENT

• Developing ideas for improvement begins with this
  step.
• These steps led to identify causes of the
  principal problem.
• Ideas for improvement must address the root
  causes of the problem before it can be
  implemented immensely in order to evaluate the
  effectiveness in solving the identified problems.

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Step 6Implement Solutions and Evaluate
SIX STEPS TO PROCESS IMPROVEMENT

• This sixth step begins by planning and
  implementing the improvements identified and
  verified in the step 5.
• Step 6 continues to measure and evaluate the
  effectiveness of the improved process.
• Finally, return to step 1 to begin the next
  increment in the ongoing process of continuous
  improvement.

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SIX STEPS TO PROCESS IMPROVEMENT
PDCA SEVEN-STEP METHOD
DO
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The Deming Cycle
DEMING CYCLE
DEMING CYCLE
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Plan
DEMING CYCLE

• Define the process start, end, and what it does.
• Describe the process list the key tasks and
  sequence of steps, people involved, equipment
  used, environmental conditions, work methods and
  materials used.
• Describe the players external and internal
  customers and suppliers, and process operators.
• Define customers expectations what, where and
  when.
• Determine data performance data and data for
  better understanding of process.
• Describe the perceive problems associated with
  process.
• Identify the primary causes of problems.
• Develop potential changes or solutions to the
  process and evaluate changes.
• Select the best solution(s).

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Do
DEMING CYCLE

• Conduct a pilot study or experiment to test the
  impact of the potential solutions.
• Identify measures to understand how any changes
  or solutions are successful in addressing the
  perceived problems.

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Study
DEMING CYCLE

• Examine the results of the pilot study or
  experiment.
• Determine whether process performance has
  improved.
• Identify further necessary experimentation.

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Act
DEMING CYCLE

• Select the best change or solution.
• Develop an implementation plan what needs to be
  done, who should be involved, and when the plan
  should be accomplished.
• Standardize the solution, e.g. by writing new
  standard operating procedures.
• Establish a process to monitor and control
  process performance

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Flow Charts
FLOW CHARTS

• Provides a clear view of how a process works.
• A pictorial representation of the steps in a
  given process.
• Steps are presented graphically in sequence with
  symbolic shapes, and the flow of the process is
  indicated with arrows connecting the symbols.
• Should include every activity in the process.
• Should be the first step in identifying problems
  and targeting areas for improvement.

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Purpose of flowcharting
FLOW CHARTS

• enable members to examine the order presented and
  come to a common understanding of how the process
  operates.
• to describe an existing process or to present a
  proposed change in the flow of a process.
• help you see whether the steps of a process are
  logical, uncover problems or miscommunications,
  define the boundaries of a process, and develop a
  common base of knowledge about a process.
• brings to light redundancies, delays, dead ends,
  and indirect paths that would otherwise remain
  unnoticed or ignored.

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Steps in Flowcharting a Process
FLOW CHARTS

1. Decide on the process to flowchart.
2. Define the boundaries of the process the
   beginning and the end.
3. Describe the beginning step of the process in an
   oval.
4. Ask yourself "what happens next?" and add the
   step to the flowchart as a rectangle. 
5. When a decision point is reached, write the
   decision in the form of a question in a diamond
   and develop the "yes" and "no" paths. .
6. Repeat steps 4 and 5 until the last step in the
   process is reached.
7. Describe the ending boundary/step in an oval.

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Symbols in a Flowchart








FLOW CHARTS
Defines the boundaries of a process shows the start or stop of a process.
Designates a single step in a process. Briefly describe the step inside the box.
A diamond signifies a decision point in the process. Write the type of decision made inside the diamond in the form of a question. The question is answered by two arrows--"yes" and "no"--which lead to two different branches.
A small circle that surrounds a letter signifies where you pick up a process on the same page represents a connection.
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Three main types of flowcharts
FLOW CHARTS

• 1. High-level flowcharts map shows only the major
  steps in a process for a good overview.

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2. Detailed flowcharts show a step-by-step
mapping of all events and decisions in a process.

FLOW CHARTS
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3. Deployment flowcharts organize the flowchart
by columns, with each column representing a
person or department involved in a process.
FLOW CHARTS
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To construct an effective flowchart
FLOW CHARTS

• Define the process boundaries with starting and
  ending points.
• Complete the big picture before filling in the
  details.
• Clearly define each step in the process. Be
  accurate and honest.
• Identify time lags and non-value-adding steps.
• Circulate the flowchart to other people involved
  in the process to get their comments.

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A completed flowchart enables you to
FLOW CHARTS

• Identify time lags and non-value-adding steps.
• Identify responsibility for each step.
• Brainstorm for problems in the process.
• Determine major and minor inputs into the process
  with a cause effect diagram.
• Choose the most likely trouble spots with the
  consensus builder.

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• Conclusion
• we need to focus on process improvement in our
  organization as a way to meet the customers need
  and satisfaction and meet the global competition
  to maintain the quality of our product or
  services.

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• THANK YOU