Value Stream Analysis: Ideas and Options Presented to Delta LTMS Regulatory Technical Work Group Presented by Dr. Joshua Burnam and Mr. Steve Cappellino April 24, 2007 Overview of Presentation What VSA is and is not How we prepare for it Logistics What it looks like options Cost What VSA is By-the-Book Lean Six Sigma is a statistical concept that measures a process in terms of defects, with the goal of reducing variability, decreasing defects and increasing efficiency using rigorous quantitative methods. Value Stream Mapping and Analysis (VSA) is one application of the Lean method designed to reduce waste and inefficiency for both the process owner and customer by mapping a process flow and looking for areas that can be improved. Specific Goals of our VSA VSA in our potential application would be applied to the agency web for project approvals, and would look for ways to unify/improve the application process; reduce inefficiencies such as feedback loops and do-overs; and improve public perception. We would essentially walk the web as an applicant.
The unified process map would be a starting point for an ad-hoc, or formal, DMMO; a consolidated permit application; or other process improvements for agencies. It will help applicants know what the order of operations is; what the information they need is the first time through; what works and what does not. Initial success would be defined by: A process map Agency recognition of their role in the larger web Applicant recognition of their role in the process Key Tenets of VSA Reduce/eliminate time, waste, inefficiency Include both owners and customers Twelve total steps between defining the boundaries and assumptions; the current state; and the idealized future state. Define the VSA Boundaries Process Inputs Major Elements of the Regulatory Process: Suppliers: Permit Applicants Applicant Agents Interested Members of the Public Resource Agencies HQACE Local Govt. What:
Application Project Information Opinions Private Design Applicability of Rqmts Outputs Public Notice Endangered Species Review of Completeness Section 106 Jurisdictional determination Scope of Analysis Alternatives Analysis 404(b)(1) Guidelines NEPA Analysis Public Interest Determination Develop the Package 401 Certification CZMA Consultation with Indian Tribes Public Hearings Trigger: J.D. Request or Application Received Customer: Permit Applicants What:
Permit Decision Done: Permit Decision Issued Define the Outcome 1. Business CaseWhy are We Here?? How will this Benefit us?? Efficiency must be increased to maintain the quality of permit decisions and improve public perception. 2. Key Requirements (Musts)Requirements That Cant Be Changed Existing Statutory and Regulatory Requirements 3. Value StatementTotal Value Stream Examined in This VSA Efficient entry into the process by applicants, and timely permit decisions that comply with State and Federal laws and regulations and, if a permit is issued, enables the applicant to proceed with a practicable project. 4. Key Measurements2 to 3 Metrics which we will measure future success by 1. 2. Turn-a-round Time i.e. elapsed time from date a complete application is received by all agencies to issuance of final permits. Goal is 120 days. First Pass Yield of Applicant Submittals Percent complete and accurate the first time. Goal is to increase FPY to <90% What are our Main Issues? Examples: Flat budgets Increasing workload Increased mandates Perception/reputation of Agencies Applicant knowledge/savvy Confusing application order-of-operations What VSA is not Cheap (depending on what we pick) Easy (it is time consuming and has
homework) A silver bullet it will give us maps of where are and where we can get, but we must then implement the process improvements Who Should Attend / Participate Not a delegated activity Minimum requirement is value stream Leadership Team KEY LEADERS PM, PROCESS OWNER(s) MANAGERS/SUPERVISORS of the PROCESS SMEs KEY STAKEHOLDERS CUSTOMERS of the VALUE STREAM SUPPLIERS to the VAULE STREAM Limit attendance to no more than 20 people Schedules are cleared for full-time participation (3.5 days) Hang time - not an 8 to 5 activity - plan on long days Data Collection In our case a Case Study Performance metrics CURRENT YEAR-TO-DATE PREVIOUS FISCAL YEAR Demand (historical and projected) BY END-ITEM DELIVERABLE $s AND #s Voice of the customer Key issues Key Opportunities Current organization chart Facility block layout Logistics
centrally located team room with lots of wall space LDC projector DVD player and TV 2 paper flip charts on sturdy stands colored markers (both wide tip and fine point) roll of butcher paper roll of masking tape roll of scotch tape post-it notes (various sizes and colors) sticky dots (nickel sized red and green in color) name tags (sticky paper-type are fine) drinks and snacks Value Stream Analysis 4 Day Professional Facilitation 1: DEFINE THE BOUNDARIES 2: DEFINE THE VALUE. 3: SET UP THE M AP . prepare 4: OBSERVE AND GATHER DATA 5: M AP THE FLOW OF ITEM S 6: M AP THE FLOW OF INFORM ATION 7: ADD DATA BOXES AND HIGHLIGHTS 8: GO BACK TO THE GARAGE current conditions breakthroughs 9: CHOOSE NATURAL GROUP S 10: DEVELOP IDEAL STATE M AP vision
plans 11: DEVELOP FUTURE STATE (6-12 M O. M AP ) 12: DEVELOP ACTION P LANS AND TRACKING Beginning your Lean Transformation Define (2-3) measures you want to impact by 10-50% in the next 12 months through the application of VSA WHAT? HOW MUCH? BY WHEN? GO NOWHERE, START NOTHING UNTIL EXPECTATIONS ARE CLEARLY DEFINED MAKE SURE YOU AGREE WHAT YOU WANT FROM LEAN AND HOW TO MEASURE IT Step 1: Define what you want from Lean TYPICAL 4 DAY AGENDA Value Stream Analysis Day One 08:00 08:30 08:30 11:00 11:00 12:00 12:00 13:00 13:00 15:00 15:00 1700 Day Two 08:00 08:30 08:30 10:00 10:00 12:00 13:00 14:00 14:00 15:00 15:00 1700 Process Owner Kick-off & Introductions Value StreamAnalysis Briefing Define the Boundaries Step 1 Lunch Set Up the Map - Steps 2-3 Walk the Process - Observe and Gather Data Step 4 ReviewDay 1 and Plan for Day 2 Continue to Observe and Gather Data - Step 4 Build the Current State Map Steps 5-7 Go Back to the Garage Step 8 Choose Natural Groups Step 9 Develop Ideal State Map Step 10 TYPICAL 4 DAY AGENDA Value Stream Analysis
Day Three 08:00 - 08:30 08:30 - 12:00 12:00 - 13:00 13:00 - 17:00 ReviewDay 2 and Plan for Day 3 Develop Future State Map Step 11 Lunch Develop Action Plan and Tracking - Step 12 Day Four 08:00 - 10:30 10:30 - 11:30 11:30 - 12:30 12:30 - 15:30 Prepare Outbrief Outbrief Lunch Prep for First Rapid Improvement Event Value Stream Analysis Charter Value Stream Output and Description : (What is the value provided to the customers of this Value stream? Provide a comprehensive list of deliverables) Preliminary Objectives: (What are the key objectives for improving the Quality, Delivery/Responsiveness, Cost/Productivity of the value stream. Objectives should be SMART = specific, measurable, achievable, realistic, tangible) Event Dates: Team Leader: Co-Leader: Team Members: Process Owner: Customer Requirements (TAKT Time): (Demand on this value stream, i.e., the number of items requested by the customer.) Sensei: Current Situation and Issues: Current State Process Information: (General description of the how the process current performs metrics
are valuable so include where possible) Why are you conducting this VSA event? What is your burning platform) Date: Prepared By: Event Name: Value Stream Mapping (VSA) Event Checklist Value Stream 3rd Week Before Event: 1: Select area and topic. (Complete VSA Charter Form) 2: Meet with Process leaders(PL) or /Functional Leaders(FL) to: - Prioritize Value Streams within Area - Secure Full Time Participation of Team Members - Obtain PL/FL Commitment to Event Follow-up 3. Prioritize Value Streams within Area 4: Define team leader, co-leader and the team members. 5: Would like site leadership and key site personnel involved - Team size of 15 - 20 are recommended per Value stream 6. Identify Event Facilitator(s)/Consultant(s) - Obtain External Consultant Seport As Req'd 2nd Week Before Event: 1: Review "3 weeks before" list, resolve open items 2: Gather data/identify sources on current state - Identify sources of data on current process (Financial Reports, Flow Charts, Command Media etc) 3: Determine current customer steady state demand 4: Determine actual output (if not available use most current predicted or budgeted figures) 5: Determine top 5-10 categories of problems noted from the information collected (eg. Shortages,schedule misses...). 6: Review actual customer issues, audit results, etc. List top 5 issues. 7: Determine key individuals needed to support on ad hoc basis: - Secure ad hoc support based on proposed event schedule
8: Secure Conference Room(s) For Event - Ideally room should be located near work area - Room must be available for entire duration of event 9: Obtain all necessary supplies for event - Post it Notes, small square multi color 2 /78x2-7/8 and 3-7/8 5 7/8 - Flip Charts , Markers, tape , scissors - LCD PROJECTOR - Will this team improve your Process/Functional performance? - Butcher Paper (rolls) - Are you focusing your scarce resources on the right priorities? - Access to laptop to document event - what is the business case for analyzing this Value Stream? 1: Review "3 weeks before" and "2 weeks before" checklists. Resolve open items. 2: Revisit Items 8 & 9 from 3 weeks before has anything changed? - Run reports on actuals etc. - Brief on upcoming VSM Event (non team members that may get involved) 7: Define the deliverables expected from the Event team (eg. Quality Improvement, Reduced Flow Time, Reduced Cost etc.) 8: Select 2 -3 measurements and targets for the team that will help define success for the team. 9: Review deliverables, measurements and targets with the external or internal consultant. Revise if needed. 10: Ask a few hard questions (then revisit 1, 2 and 3): 1st Week Before Event: - Etc. 10: Issue written invitiation to team members. Include event particulars, time expectations and deliverables. 11: Review and confirm Event team leader, co-leader and members. - Make sure team members are committed for the whole event!!! 12: Brief team co-leaders and members: Event schedule,
measurements, targets and deliverables. 13: Review packages from any previous events in this area. Pay special attention to time observations, layouts (spaghetti diagrams), accomplishments lists, lessons learned. 14: Brief facilitator/consultant on event - Review checklist status - For external consultants review program, key events and individuals - Provide read ahead material to external consultants on business & program 3: Define clearly the boundaries of the Event: - who are the customers? - what are the outputs? - what triggers the area to do something for a customer? - who are the suppliers? what are the inputs? 4: Hold final prep meeting with Team lead & co-leaders, resolve any open issues or concerns 5: Arrange for working lunches for team 6: Review event status with facilitator/consultant. Business Case Value Statement In light of increasing workload and complexity associated with the regulatory program, efficiency must be increased to maintain the quality of permit decisions Key Requirements Timely issuance of a permit decision that comply with Federal laws and regulations and, if a permit is issued, enables the applicant to proceed with a practicable project Measurements Domestic Statutory and Regulatory Requirements
Current State Map Ideal State Turn-a-round Time i.e. elapsed time from date application is received to permit issued Goal is 100% within 120 days Total Application Backlog - i.e. number of applications in process and/or waiting to be processed at any given time. Goal is to reduce by 50% First Pass Yield of Applicant Submittals Percent Complete and accurate the first time. Goal is to increase FPY to <90% On-Demand Defect Free 1-By-1 Lowest Cost Jurisdictional Determination Court and/or Appeal I I Division Process Correct I Appeal Mtg.
I Y Send Additional Info to District I Sec Chief assigns to PM Complete ? PM Review for completeness Yes Field Visit I Y I Office Visit Site Visit I I Verify Delineatio n I Letter Developed PM Issues Letter I No
30% I 1% PM Signs Letter Letter Developed Verify 2nd Applicant Appeal Applicant Appeals N Set up Field Visit Field Visit JDs I I Admin Records Prep I More Info. I Applicant Division Review
I Csll/Email Applicant for more info. Develop Disclaimer Letter 25% I Receive Additional Applicant Info I 75% Sec Chief Review I Office of Council Review I No permit or Jurisdiction Required Review Application A Indvidual Permit Process Indvidual Permit Process A Public Notice Drafted Application Complete I
I Water Quality Certif Endangered Species Essential Fish Habitat Coastal Zone Mgt. I I Decision Document I B B I Draft Decision Doc and Permit Ltr. Sec Chief Review I Branch Chief/ Distr Eng. Review Put in Final Form I Permit Decision Issued
Applicant Sign Corps Sign I 80% Assess ESA info. I Effect? Services Review Y I I Complete ? Appl and Corp Review draft BO Y Consultation and Draft BD I I No/Maybe I Service Completes BO I
N Contact Applicant I External Organization Review Response I Cultural/Tribal Ledgend Ltr to Appl. Corp Review Comment Ltr I I Letter or Phone Call to Applicant Recv. Add. Info Public Notice Issued Applicants Incomplete I Coord w/ Arch/Corps, Cultural Resources
Complete ? I Y Sec 106 Determ Effect? N N MOA Complete Maybe SHPO signs MOA Generate Ltrs SHPO Rev Sec 106 I Complete ? N I Corps Corps SHPO Drafts forwards forwards MOA MOA to SHPO MOA to Tribes Total TotalFlow
FlowTime Time Total Touch Time Total Touch Time ==152 152- -383 383days days ==105 132 hours 105 - 132 hours Future State Map Value Stream Map Business Case Value Statement In light of increasing workload and complexity associated with the regulatory program, efficiency must be increased to maintain the quality of permit decisions and improve public perception of the regulatory program Timely issuance of a permit decision that comply with Federal laws and regulations and, if a permit is issued, enables the applicant to proceed with a practicable project. Key Requirements Domestic Statutory and Regulatory Requirements Measurements Ideal State 1. Turn-a-round Time i.e. elapsed time from date application is received to permit issued Goal is 100% within 120 days 2. Total Application Backlog - i.e. number of applications in process and/or waiting to be processed at any given time. Goal is to reduce
by 50% 3. First Pass Yield of Applicant Submittals Percent Complete and accurate the first time. Goal is to increase FPY to <90% On-Demand Defect Free 1-By-1 Lowest Cost Applicants E le c t r o n ic In f o r m a t io n Supermarket PM reviews and approves for site visit Applicant Request FIFO Key Changes to Create Future State - Requirement on applicant is significantly greater - Applicant is to provide all required info up front - Application is complete after application info is verified by PM - Measure of throughput /turn-around time will include time from application received - Created one piece flow (uninterrupted concentration on task) - Reduced the amount of wait time - Placed permit decision and signature authority on PM - Included 15 day public notice versus 30 day standard - Reduced rework by improving the application submittal process - Corporate policy and regulation need to be re-visited - Process quality must be addressed - Abandon the Current State process - Command must support the new process including turned back applications (request for additional applicant info) -Must establish (mistake proof) guidelines for application submittals Schedule site visit Site Visit
I Verify Deliniation Complete Y Public notice issued Issue JD verification ltr N Avoidance/ minimization I 15 day comment period ESA Required? Start ESA Sec 7 consultation Start decision document N One level of review for lower grade PMs Write Public Notice and JD ltr. Y 90 Days
45 Days Permit decision issued by PM PM finalizes Decision Doc. One Level of review for lower grade PMs Review draft BO I Comments Received and sent to Applicant Applicant responds to comments to PM I 30 Days Continue writing Decision Doc. Phone Applicant for signature Value Stream Path Regulatory Lean Process Metrics Metric Regulatory Flow Time (days) Touch Time (hours) # People # Approvals # Handoffs Items in Inbox % Yield of the IP Process Current
State 152-383 105-132 32 15 30 174-686 1.47 Future Delta State * # % Improvement 77-156 minus 75 - 227 49 - 59 80 minus 25-52 24 - 61 11 minus 21 66 3 minus 12 80 7 minus 23 77 10 minus 164-676 94 56.00 plus 54.53 97.4 *Projected VSA Without Facilitator VSA Lite - 2 Day Process led by SPD Expert Dr. Aaron Allen without consultant First Day: 1. Introductions (30 minutes) 2. Brief Introduction to VSA (30 Minutes) 3. Define the Boundaries (2 Hours) 4. Walk the Process and Build Current State Map (4-6 hours)
Second Day 1. Complete Current State/Review Current State (30 minutes) 2. Develop Ideal State Map (1 hour) 3. Requirements for the Future State (1 hour) 4. Develop Future State (4 hours) Differences from 4-Day Homework still required No computerized maps of the process (just hand-drawn) No computerized metrics Less time Less cost Costs 4-Day Facilitated VSA was $31,500 including time and materials for the consultants (Anteon/Simpler) 2-Day VSA lite may be free Homework: Prepare our case study, charter, and goals Get room for 2-4 days Deal with logistics of paying the consultant Questions/Comments?
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