three tools for identifying efficiency savings

© 2011 Copyright ISC Ltd.

Three tools to identify efficiency savings

OR Society Criminal Justice SIG

3rd February 2011

Presented by: Ian J Seath


Overview

This will be a participative session introducing some simple tools that organisations can use to help identify efficiency savings: We will look at: The Cost of Quality (from TQM) The Seven Wastes (from Lean) The Right Things/Wrong Things Grid

Efficiency - definitions

The state or quality of being efficient; competency in performance

Accomplishment of, or ability to accomplish, a job with a minimum expenditure of time and effort

The ratio of the work done or energy developed by a machine, engine, etc., to the energy supplied to it, usually expressed as a percentage


COST OF QUALITY1.


Finished files are the result of

years of scientific studies

combined with the experience of

many years


Quality Costs

Prevention Activities which are designed to ensure work is done right

the first time (e.g. Training, Planning, Agreeing Specifications, Developing Procedures)

Appraisal Activities which are designed to see if work has been

done right the first time (e.g. Checking, Inspecting, Audit)

Failure Activities which are made necessary by failure to do work

right the first time (e.g. Reworking, Downtime, Chasing, Apologising)


Prevention

Appraisal

Failure

Core Work(Value Add)

Costof

Quality

Improvement

Time

Re-designedProcesses

Designing inQuality

IncreasedRight FirstTime

ReducedChecking

Cost

IncreasedPrevention

ProcessImprovement

ProblemSolving


Elements of the Cost of Quality: Examples Prevention

Defining Customer Requirements

Training Developing Standard

Operating Procedures Planning

Appraisal Proof-reading Checking each others’ work Inspections Audits

• Failure• Dealing with Customer Complaints• Repeating work• Unproductive meetings• Progress chasing for paperwork,

materials, decisions • Fire-fighting/problem-solving• Compensation claims and payments


Determining the Cost of Quality Identify relevant elements of CoQ Determine "hard costs" from Management

Accounts Determine "soft costs" by use of time Survey/

Questionnaire Convert "soft costs" to £ Analyse into Quality Costs


Improvement opportunities

In a Service business CoQ can typically be as much as 40% of operating costs 20% Failure 15% Appraisal 5% Prevention

In the Public Sector, Appraisal Costs are usually much higher than in the Private Sector

With effective use of problem solving and process improvement it should be possible to halve (at least) Failure Costs in 12-18 months


THE SEVEN WASTES2.


Evolution of Lean Thinking


Lean Concepts

Toyota ProductionSystem

Lean Thinking“Lean Enterprise”

Waste Waste is anything that does not add value to

your product or service Eliminating waste gives you more resource to

meet your customers’ requirements Waste will always be present, so there is always

something that you can do to improve your performance

Identifying all the waste in your processes forces you to compare your operation against perfection.....…and this is not a comfortable experience!


The Seven Wastes


Waste ExamplesPeople Waiting Waiting for “stuff to arrive”, Waiting for people to make a decision

Over-production

Producing extra copies “just in case”; Sending two people, when one would be enough

Rework & Failures

Correcting errors in reports, databases, plans, documents , Dealing with complaints, Paying compensation claims, Operating a Helpdesk

People Moving Travelling to and from meetings, incidents, interviews

Over-processing

Doing any steps that are unnecessary; Checking the quality of somebody else’s work; Keying the same information into multiple databases; Gathering the same information from a client/victim/suspect on different Forms

Inventory Cupboards full of stationery in every office; Stores of obsolete brochures, forms, posters; Piles of files on desks (work in progress)

Transport of materials

Moving files around between locations; Moving files to and from archives

Spot the waste…


The Seven Wastes


Waste Examples in Police taped interview processesPeople Waiting Waiting time while tapes are retrieved from storage so they can be

collected by an officer.

Over-production

Producing three copies of the interview tape even though defence solicitors virtually never ask for a copy.

Rework & Failures

Corrections of transcripts because the original tape was inaudible, broken, etc.

People Moving Officers travelling to the transcription team to deliver tapes (due to fear of loss) and any travel to/from tape storage.

Over-processing

Checking information for completeness when it arrives at the transcription team (it should not be delivered incomplete). Checking transcripts after they have been returned from correction (why would they be wrong a second time?).

Inventory All the storage of tapes, plus any temporary storage by officers at their desks. Also, the storage of blank tapes, required for interviewing.

Transport of materials

All transport of tapes between police stations and transcription and storage.

Waiting Waiting

People waiting Materials waiting

Examples Backlogs of offenders waiting to start a programme

UPW equipment / vans not in the right place at the right time

UPW stand downs / send homes

Backlogs of paperwork / cases waiting in an in-tray

Court processes, just one big wasteful waiting game!


Over-production


Producing more than required Producing faster/sooner than required; e.g.

Report

Report

Update

Rework and Failure

Producing and coping with failures and rework steps

Examples

All activity relating to non-attendance breach (hence the aim to increase compliance in Probation processes)

Correcting or cleaning up data in case management systems

All trials held up due to witnesses not turning up, case papers not being ready

Writing a report by hand and then getting someone else to enter exactly the same details onto a computer


People Moving

All the movement of staff that we see in a ‘busy’ office is waste

No value is added by the movement of staff; we only add value at the start or end of any movement

Examples Offenders and supervisors coming into a central UPW reporting

point, only to be sent back out again to work placement sites Any journey where no value-adding tasks are performed Photocopiers, printers centrally located that everyone has to walk

to when they want to use them People coming back to the office to enter data / information in

office-based IT systems


Over-processing

Doing steps you don’t need to do and that will add value to the customer or user

Examples Details written down repeatedly and then input into a variety of IT

systems (name and number x 20 in first 24 hours of arriving in Prison)

Writing a full Standard PSR when a Fast or Oral PSR would have been more appropriate

Putting a case though MAPPA when the level of risk and multi-agency involvement did not warrant

Getting a procurement manager to sign off every order (even when some are for 10 pens!)


Inventory Inventory is the piling-up of work between process

stages If we have designed a process along Lean lines, the only

queue should occur at the start of the process Any other piles of inventory indicate a problem in the

process Examples

Piles of work waiting for someone to return from holiday Queues of offenders waiting for a Programme or Unpaid Work

session to commence PSRs waiting to be typed-up or signed Piles of PDPs or Annual Appraisals all waiting to be completed at

the same time of the year


Materials moving

The time and effort spent moving physical items around your workplace

In the Courts processes a good example is the time spent moving a prisoner around for a 5 minute hearing

In Probation it refers to the movement of offenders, movement of vans for Community Payback work, or paperwork moving backwards and forwards between people

We know that all transport/movement is impossible to eliminate but recognising it as a waste means that we should be trying constantly to reduce it


Improvement opportunities Apply Lean principles to

Improve flow (increase Pull, reduce Push) Reduce cycle-time (increase Value Add Ratio)


RIGHT THINGS – WRONG THINGS GRID

3.


Right Things – Wrong Things Grid

Right Things, Done Badly

Right Things,

Done Well

Wrong Things, Done Badly

Wrong Things,

Done Well


Effective

EfficientNot Efficient

Not Effective

Right Things and Wrong Things “Right Things” are the same as Core Work (customer value-add

activities), and Prevention activities from CoQ. Wrong things are most Appraisal activities and all Failure activities. This is the “Effectiveness” axis of the grid

“Done Well” means “Right First Time”. “Done Badly”, means

anything with errors. This is the “Efficiency” axis of the grid

The target is “Right Things, Done Well”. Everything else presents an opportunity to reduce waste “Right Things, Done Badly” need to be fixed (addressing root causes) “Wrong Things” need to be stopped completely, but will require a check first, to

confirm there is no customer requirement


Ian Seath:Improvement Skills Consulting Ltd. Early career in manufacturing (R&D, Production,

Marketing, Training) 20 years consulting, specialising in

implementation of Continuous Improvement Public, private and voluntary sector clients

NOMS, Police, Home Office, MoD, BBC, Ofgem, FSA Utilities, Law, Telecoms, IT, Financial Services

We help organisations to develop

the capability to improve continuously© 2011 Copyright ISC Ltd.


Three tools for identifying efficiency savings

Presented by: Ian J Seath

Improvement Skills Consulting Ltd.

February 2011

[email protected]

M: 07850 728506

W: www.improvement-skills.co.uk

mailto:[email protected]

http://www.improvement-skills.co.uk/

three tools for identifying efficiency savings

Business