Saturday, April 8, 2023
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Six Sigma and the PMBoKSix Sigma and the PMBoKSynergy and Best PracticesSynergy and Best Practices
Nadim Baker, CEOProject Incentives, Inc.
http://projectincentives.com
Saturday, April 8, 2023
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Our Priorities for TodayOur Priorities for Today
1) Define terms.2) Examine differences between Six
Sigma and Project Management.3) Explore the synergies between same.4) Engage in discussion.
Did I miss anything?
Saturday, April 8, 2023
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What I Need From YouWhat I Need From You
Your TimeWe’re here for 1:30, and will end on time.
Involvement If you have a question, please interrupt me. If you think you can offer help with another
attendee’s question, please do so – we’re here together.
RespectWe have limited time here today, please
respect other guests’ timetables. Please turn off pagers and phones.
Saturday, April 8, 2023
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My Goals For TodayMy Goals For Today
Establish DifferencesSix SigmaProject Management
Examine SynergiesProcess
ImprovementsOutput Effectiveness
Add Value
Saturday, April 8, 2023
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My Goals For TodayMy Goals For Today
1) Have each of you leave with a clear understanding of the benefits and differences of Six Sigma and Formalized Project Management.
2) Have presented this information in a way which brings you value.
3) Have answered as many questions as possible within the allotted time.
4) Have received feedback from each of you.
Saturday, April 8, 2023
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6
Defining Some TermsDefining Some Terms
Preventing Misunderstandings
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Define TermsDefine Terms
Project “A temporary endeavor undertaken to
achieve a particular aim.”
Project Management “The application of knowledge, skills, tools
and techniques to a broad range of activities in order to meet the requirements of the particular project.”
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Define TermsDefine Terms
ProcessA series of steps and activities that take inputs, add
value, and produce an output.
Six SigmaTechnically - a statistical representation of 3.4
defects per million opportunities.Organizationally - a managerial methodology of
continual product improvement identified and measured through the use of process variance statistics.
Successful Six Sigma is an Attitude, not just a Method.
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Define TermsDefine Terms
PMBoKThe Project Management Body of Knowledge.
Compiled, edited, and published by the Project Management Institute (PMI). Recognized as the global standard of Project Management best practices.
CTQ“Critical To Quality” – Each organization has
specific paths and processes which add value for the customer.
Saturday, April 8, 2023
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Define TermsDefine Terms
CustomerThe person, place or thing for which a
particular process adds value.• Individuals, Companies, Groups, Teams,
Etc.
Key Performance Indicator (KPI)The summarized measurement of one or
more statistical outputs which represent significant value to a process’ customer.
Saturday, April 8, 2023
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SS One-LinerSS One-Liner
“Six Sigma is about creating accurately predictable output processes that are fully aligned with customer demands.”
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Six SigmaSix Sigma
Six Sigma is an organizational initiative or discipline that measures statistical variance and determines what pieces of a process must be improved by:
Measuring the inputs, efficiency, and output.
Mapping it against customer demands.
Identifying improvement areas.
Resetting benchmarks.
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Project ManagementProject Management
Project Management is a practice or methodology that optimizes the way in which an organization goes about the improvements.
Defining the in-, inter-, and dependent steps necessary to achieve a pre-defined worthwhile goal.
Identifying the resources, skills, and timeframe available.
Tracking and measuring progress towards achievement of goal.
Saturday, April 8, 2023
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Hmm…Hmm…
“For the Professional Organization which practices Project Management as a deliverable, the Six Sigma process may be applied to the PM Methodology as a quality improvement tool.”
Examples: Software Development, General Contractors, Construction Engineering Firms.
Saturday, April 8, 2023
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Synergistic PM/SS BehaviorSynergistic PM/SS Behavior
Suggestion #1: Any effective Six Sigma implementation requires effective Project Management to be successful.
Suggestion #2: Quality Project Management methodologies require constant improvement over time. (The PMBoK is a living document…)
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The DifferenceThe Difference
Six Sigma measures, defines, and statistically supports WHAT must be improved.
Project Management measures, defines, and supports HOW the improvements are made.
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SummarySummary
These two initiatives are:
1. Required for long term success.
2. Conjunctively responsible for success.
3. Synergistic towards effective continual improvement.
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Six Sigma Six Sigma FundamentalsFundamentals
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Why Six Sigma?Why Six Sigma?
“If you have no data, you’re just another person with an opinion.” - George Eckes
“Whatever you measure will change. Measure the right things.”- Dr. Gerry Faust
“What gets measured, gets done.”- W. Edwards Deming
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Eight Steps to Six SigmaEight Steps to Six Sigma1)Identify Strategic
Business Objectives
2)Identify Core, Key Sub, and Enabling processes.
3)Identify Process Owners
4)Identify Dashboards (KPI’s)
5)Collect Data from KPI’s
6)Process Improvement Selection Criteria
7)Prioritize Process Improvement Projects
8)Continual Management of Processes (The Tube)
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What To Measure?What To Measure?
The Basic Stuff:Input Measures (Suppliers’
Effectiveness)Process Measures (Your
Efficiency)Output Measures (Your
Effectiveness)
Measure Output First!
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Why Output First?Why Output First?
1. Your company makes money in direct proportion to its ability to create value for your customer.
2. Output Measures will quickly define which Processes serve, or enable service to, the customer. (CTQ’s)
Saturday, April 8, 2023
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Pareto’s RulePareto’s Rule
The 80/20 Principle“80% of something is caused by
20% of something else.”Focus on your 80% problem, and
life is good. Your Output Measures will
almost always contain the key indicators of your 80% problems.
Saturday, April 8, 2023
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Operational DefinitionsOperational Definitions
Important Note!Make sure you are using lowest common
denominator language – it must be clearly understood across the entire enterprise…
Examples of misnomers:FAA’s “Departure Time” vs. realityThe “Customer Service Representative”9,999 meanings of “Quality”
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Sidebar On Company FocusSidebar On Company Focus
Operational Operational ExcellenceExcellence
Operational Operational ExcellenceExcellence
Customer IntimacyCustomer IntimacyCustomer IntimacyCustomer Intimacy
Product LeadershipProduct LeadershipProduct LeadershipProduct Leadership
“The Best Product”
“The Best Total Cost” “The Best Total Solution”
Product Differentiation
Customer ResponsiveOperational Competence
Market LeadersMarket Leaders are the best are the best at only one of these, and at at only one of these, and at (or near) benchmark for the (or near) benchmark for the others.others.
Consider These:Consider These:
- Wal-Mart – Inventory Control- Wal-Mart – Inventory Control
- Motorola – Product Innovation- Motorola – Product Innovation
- Starwood Hotels – Personal Service- Starwood Hotels – Personal Service
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SummarySummary
Six Sigma is a methodology, not a destination or goal.
Choose your processes along the “Critical To Quality” path.
Choose your Operational Definitions well
Always remember Pareto’s Rule
Invite Clint Eastwood to the game
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Optional 5 Minute BreakOptional 5 Minute Break
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Project Management MethodologyProject Management Methodology
Why is it important to Six Sigma?
Saturday, April 8, 2023
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Project Management MethodologyProject Management Methodology
Because 50 years of experience and 43,000 PMP’s have already
written the answer to this question:
“How do we accomplish this?”
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Justifying PM MethodologiesJustifying PM Methodologies
Formalized Project Management:1. Reduces Financial Loss2. Increases Resource Productivity3. Increases Quality of Output4. Preserves and Promotes Organizational
Best Practices5. Identifies Limits
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Prevalence of Project FailurePrevalence of Project Failure
Standish Group Study (1994) ~8,400 IT projects Total value greater than $25,000,000,000
• 16% successful – on time, within budget, met the specs, and led to used deliverables
• 50% in “recovery”• 34% outright failures
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J.D. Frame’s StudyJ.D. Frame’s StudyIn December 1997, Frame conducted a survey of In December 1997, Frame conducted a survey of 438 project workers. 438 project workers.
The results summary:The results summary:On your last project, did you meet your budget target?
• 55% over budget
• 27% on budget
• 18% under budget
On your last project, did you achieve the desired specifications?
• 29% short of specs
• 51% met the specs
• 20% better than specs
On your last project, did you achieve your schedule target?
• 69% slipped schedule
• 22% right on schedule
• 9% beat schedule
J. Davidson Frame, Ph.D., PMPJ. Davidson Frame, Ph.D., PMP
University of Management and TechnologyUniversity of Management and Technology
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Survey Says…Survey Says…
Three universal sources Three universal sources of project problems:of project problems:
The organization – e.g., problems of matrix managementPoor management of needs and requirements – e.g., scope creepPoor planning and control – project workers are ignorant of good practice; the organization doesn’t provide data needed to sustain planning and control efforts
Frame’s study indicated Frame’s study indicated poor estimates as a poor estimates as a prime source of project prime source of project failure:failure:
Perhaps half of project failure is tied to poor estimatesWhen you estimate that a ten month job can be done in six months, cost overruns and schedule slippages are hardwired into the project
FrameFrame also concluded the also concluded the following:following:
Did you ask the implementers?Did you ask the implementers?
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The Key Source of Project FailureThe Key Source of Project Failure
My Personal Belief:My Personal Belief:
The #1 reason for project failure is:A Breakdown In COMMUNICATION
Saturday, April 8, 2023
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The Professional Project ManagerThe Professional Project Manager
The Evolution of Project Managers’ Roles
Saturday, April 8, 2023
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Project ManagersProject Managers
1950s through the 1980s – Strictly Implementers Narrow orientation. Mostly focused on technical implementations. Narrow skillset - budgeting, scheduling and spec
interpretation.
Mid-1980s to Now – Tactical Business Decision Makers Projects management equivalent to business management. Broadened skillsets, increased pressure for performance Greater authority and responsibility. Increased compensation, often tied directly to results rather
than efforts.
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Changes Reflected in the Changes Reflected in the PMBOKPMBOK
Scope management Time management Cost management Human Resource
Management
Risk management Quality management Procurement management Communication
management Integration management
Traditional Competencies
New Competencies
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Traits of Effective Project ManagersTraits of Effective Project Managers
Detail Oriented.
Diplomacy and Interpersonal Skills.
Success Oriented.
Self Motivated.
Effective Problem Solver.
Readily copes with ambiguity, setbacks, disappointments.
Open and Effective Communicator.
Results Focused.
Politically Savvy.
Good Negotiator.
Comprehensive Business Knowledge.
Competent.
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The Competency FactorThe Competency Factor
Searching for Excellencerather than Perfection
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What is Competence?What is Competence?
“Competence is the capacity to employ knowledge and skills to achieve defined results in an effective fashion.”
Saturday, April 8, 2023
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What is Competence?What is Competence?Knowledge -- in Project Management, the PMBOK
Guide identifies nine knowledge areas that competent project professionals should have some mastery of:
Scope, Time, and Cost Management. Human Resource Management. Risk Management. Quality Management. Procurement Management. Communication Management. Integration Management
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What is Competence?What is Competence?
Skills -- competent project workers should possess skills in a range of areas, including:Project-related skills. Sociopolitical skills. Interpersonal skills.Business skills.
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Is Competence Important?Is Competence Important?
The cost of The cost of incompetenceincompetence:: Each day of delay in government approval of a drug
may cost a pharmaceutical company $1,000,000 in lost revenue
One month’s slippage on a 100 million pound telecommunications project in the UK might incur a one million pound penalty
The collapse of a poorly constructed building, where life is lost, may cost a builder millions of dollars in damages and a loss of reputation
A data entry error by a bank clerk may lead to thousands of dollars of losses
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The Competence DilemmaThe Competence Dilemma
The Common Wisdom:Given the right support, people will rise to a
challenge and behave competently.
Reality:Successful competence development of
individuals is varied at best. A small number of people can be classified as high performers. In the realm of competence, Pareto’s Rule vastly applies.
A guy named Tim once said: “Just because someone can, doesn’t mean they will.”
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Three Levels of CompetenceThree Levels of Competence
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Competence of IndividualsCompetence of Individuals
The project management competence of individuals has three dimensions:Mastery of project management
knowledge and techniquesMastery of soft skillsMastery of business competencies
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Competence of TeamsCompetence of Teams
Define clear and realistic goals.
Clearly define deliverables.
Produce a proper mix of skills.
Produce proper level of knowledge.
Identify and acquire adequate tools.
Practice discipline: Communication. Regular meetings. Well-defined
documentation.
Cohesion and the capacity to reach consensus readily.
Boldness.
Dynamic and appropriate team structure.
Effective diversity integration.
Focus on goal attainment.
The ability to act in the best interest of the customer, the company and the team.
Successful Project Teams Must:Successful Project Teams Must: And Exhibit These Traits:And Exhibit These Traits:
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Competence of OrganizationsCompetence of OrganizationsIn the name of “Quality”, there are many ways
to grade certain degrees of an Organization’s process management competence: Deming Prize ISO 9000 Baldridge Award Capability Maturity Model (CMM)
For some organizations, pursuit of awards such as these can be irreversibly destructive.
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Competence of OrganizationsCompetence of Organizations
Organizational Competence = Enablement
Most Quality Models Exhibit:Focus on the organizational environment as
an enabler.Permit individuals and teams to do the best
job possible.A myopic focus on increasing customer
value.
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Traits of Competent Traits of Competent OrganizationsOrganizations
Clearly defined procedures. Open access to appropriate information. Adequate quantities of proper resources. Easy access to appropriate training and
education. Clearly defined organizational vision and
values. Distinct culture of open communication. A commitment to ongoing improvement. Institutionalization of project management.
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SummarySummary
Key Points to Remember
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Key PointsKey Points
Six Sigma and Project Management are synergistic in nature
Six Sigma defines WHAT needs improvement; the BREADTH of a quality project.
Project Management defines HOW to accomplish the improvement; the DEPTH of the quality project.
Saturday, April 8, 2023
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53
Key PointsKey Points
Both SS and PM require competence to succeed.Six Sigma requires competence in
business strategy, market alignment, and process engineering.
Project Management requires competence of the individual, the team, and the organization
Saturday, April 8, 2023
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Key PointsKey Points
Remember Pareto, Eastwood and Tim - They can be your best friends!
Pareto:The 80/20 Principle
Eastwood:Gotta know the limits
Tim:Just because someone can, doesn’t
mean they will
Saturday, April 8, 2023
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Thank YouThank You
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Book RecommendationsBook Recommendations
J. Davidson Frame, Project Management Competence (San Francisco: Jossey-Bass, 2000).
Michael Treacy & Fred Wiersema, The Discipline of Market Leaders (Perseus Books)
George Eckes, The Six Sigma Revolution, (John Wiley & Sons, Inc.)