Understanding and improving business processes.Garry Buick, ACMA ACMA Australian Communications and Media Authority
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CGMA Comparative Genomic Microarray Analysis , is the director of the professional development faculty at BPP (Bits Per Pixel) See bit depth.
bpp - bits per pixel Business School and regularly presents on a wide range of management accounting topics. Before this he was the finance director for GlaxoSmithKline's Asia-Pacific manufacturing division
The course started a couple of years ago in response to the increasing use of Lean finance methods (initiated by Toyota) to tackle waste, combined with the Six Sigma Not to be confused with Sigma 6.
Six Sigma is a set of practices originally developed by Motorola to systematically improve processes by eliminating defects. A defect is defined as nonconformity of a product or service to its specifications. approach of tackling variability out of processes (created by Motorola). I figured that a lot of companies were putting in place a change management process, but didn't always understand what their long-term objectives were for the process. My own experience is that when I left Glaxo in 2007, there were three and a half months dedicated to do the budget. I still had 22 years until I retired, so I realised I was going to spend six and a half years doing budgets. I felt this had to change and, increasingly, I have come to recognise that I'm not alone in this.
The course builds on the Lean methodology of placing customers at the centre of all we do, and that the methodology is structured to take this into consideration. One of the issues is to understand why there is waste, rather than just trying to fix things. We can do this through the DMAIC DMAIC Define, Measure, Analyze, Improve, Control
DMAIC Design, Measure, Analyze, Improve, Control (5 stages of Six Sigma Quality Improvement and Assurance) methodology-(define, measure, analyse, improve and control), and we use a two-hour case study around a fictitious situation at a shared financial service centre. We also map out and use tools to consider how the whole methodology is around value in the "eye of the customer", and how you ensure that the process will deliver this to the customer.
The first section looks at "What is value?" and asks "How can you get value from the finance process?" We look at the methods that came out of Lean finance and Six Sigma. It discusses how you ensure the process is customer-centric, what you want to get from the process, and how areas such as budgeting are considered a sub-optimal process.
A second section considers the value proposition. It's about deciding what the concept of value is and why we ought to be considering change. In that respect, it's important to ensure that people are excited about change. We create the "burning platform" notion, in which you have a fire on an oil platform and you need to understand how to put it out rather than jump off the side. It's like a fire within the organisation - if you don't put it out it can destroy the organisation.
I introduce the "seven deadly sins" of waste: defects, processing, overproduction o·ver·pro·duce
tr.v. o·ver·pro·duced, o·ver·pro·duc·ing, o·ver·pro·duc·es
To produce in excess of need or demand.
o , movement, transportation, inventory and waiting, which came out of the Toyota Production System, an integrated socio-technical system. The "sins" can all be found in any finance department, and in this course we go through and understand them. We look at examples of how they manifest themselves in the finance department in relation to the concept of flow - from Toyota's concept of "Just in Time".
The next area I look at is how you can identify undesirable effects within a process, once again through the work of Toyota, which understood the root causes that undermined efforts. So I introduce the use of some tools in the Lean toolkit, which can make solid improvements, insuring the process is permanently improved. Then we look at how you can implement change and how you can make sure the process improvements are put in place and the resulting benefits are delivered.
The course also delivers things you can take away to implement in your workplace. It is aimed at anybody in a finance department who knows that the process is sub-optimal and creates problems in the organisation. The interesting thing is that finance people will generally look to make a bad process work, because they often find it difficult to express themselves confidently.
That's when you have to step back and make the difference in your system. For me, one of the biggest takeaways for a finance department is to implement the culture of Poka Yoke yoke (yok)
1. a connecting structure.
n 1. something that connects or binds. - where the philosophy is so simple - never accept a defect, never make a defect and never 0 pass on a defect.
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