ISA 201Intermediate

Information Systems Acquisition

Lesson 6

Continuous Process Improvement

and

Business Process Reengineering

Learning Objectives

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• Identify the DoD policy that describes the Implementation and Management of the DoD-Wide Continuous Process Improvement Program

• Define Continuous Process Improvement (CPI)

• Define Business Process Reengineering (BPR)

• Given a DoD IT/SW process scenario, apply various BPR/CPI method principles to improve business outcomes.

Overall Goal: Apply CPI concepts with the goal of improving the internal acquisition business processes of the government.

Today we will learn to:

BPR-CPI Example: The Pits

Then vs Now: Pit Crews in Action

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Lesson Overview

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• Business Process Reengineering

(BPR)• Continuous Process Improvement (CPI)

• Principles of Lean

• Exercise

• Principles of Six Sigma

Lesson Plan

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• “The fundamental rethinking and radical redesign of business processes to achieve the dramatic improvements in critical contemporary measures of performance, such as cost, quality, service and speed.”

- DoDI 2009 5010.43

• The Department defines BPR: a logical methodology for assessing process weaknesses, identifying gaps, and implementing opportunities to streamline and improve the processes to create a solid foundation for success in changes to the full spectrum of operations.”

- 2012 DoD Business Process Reengineering Assessment Guidance

Business Process Reengineering (BPR) Defined

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It’s the Law!

• Subtitle III of Title 40 of the United States Code (AKA

Clinger-Cohen Act) requires BPR.

• Section 901 of the National Defense Authorization Act

(NDAA) for Fiscal Year 2012: Requires a Pre-certification

authority determine that an appropriate BPR has been

conducted before funds are obligated for Defense

Business Systems in excess of $1M over the current

future years defense program (FYDP)

Why BPR?

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• The DoD does not mandate a specific BPR

methodology.

• The goal of BPR is to ensure that the business

processes supported by the DBS have been

streamlined, and/or eliminated or unique requirements

and interfaces have reduced to the maximum practical

extent.

Performing BPR

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Hammer’s Seven Principles of BPR

1. Organize around outcomes, not tasks

2. Have those who use the output of the process perform the process (or contribute to shaping the process).

3. Subsume information-processing work into the real work that produces the information

4. Treat geographically dispersed resources as if they were centralized

5. Link parallel activities instead of integrating their results.

6. Put the decision point where the work is performed, and build control into the process. The managerial role is changing from one of controller and supervisor to one of supporter and facilitator.

7. Capture information once and at the source.

Lesson Overview

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• Business Process Reengineering (BPR)

• Continuous Process Improvement

(CPI)• Principles of Lean

• Exercise

• Principles of Six Sigma

Lesson Plan Status

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“Continuous Process Improvement—a comprehensive

philosophy of operations that is built around the concept

that there are always ways in which a process can be

improved to better meet the needs of the customer and that

an organization should constantly strive to make those

improvements.”

2008 Continuous Process Improvement /LSS Guidebook Revision 1

CPI Defined

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“A robust, effective CPI/LSS

program will leverage the

right tools and methods for

problems being addressed,

including Lean Six Sigma,

theory of constraints, and

business process

reengineering.”2009 DoDI 5010.43

CPI Policy

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• CPI provides organizations a structured approach for analyzing how they are currently doing work and how they can improve their processes to do the job more efficiently and effectively on an ongoing basis.

• Process improvements resulting from applying CPI effectively will greatly benefit the Department, in terms of both improved operations and reduced resource consumption.

• Application of tools from Theory of Constraints, Lean and Six sigma will improve both production and service processes.

CPI Guidebook

Lesson Overview

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• Business Process Reengineering (BPR)

• Continuous Process Improvement (CPI)

• Principles of Lean• Exercise

• Principles of Six Sigma

Lesson Plan Status

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A methodology for continuous process improvement,

focused on work flow, customer value, and eliminating

process waste; unique from traditional process

improvement strategies in that its primary focus is on

eliminating non-value added activities

2009 DoDI 5010.45

Lean

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Source: Lean Thinking, Womack and Jones

Five Principles of Lean Thinking:

1. Specify the value of a process from the customer’s

perspective.

2. Identify the value stream for each process

3. ELIMINATE WASTE: Make value-creating steps flow

4. The customer must pull value through the process

5. Continuously pursue perfection

Key Lean Concepts

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Eight Sources of Waste

Lesson Overview

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• Business Process Reengineering (BPR)

• Continuous Process Improvement (CPI)

• Principles of Lean

• Exercise • Principles of Six Sigma

Lesson Plan Status

Eight Sources of Waste Exercise

19

“When you are agile, you get lean” (Pages 1-4 – Student CD)

Describe the principle and provide your assessment and at least 1 example

• Team 1: Inventory in software development

• Team 2: Motion in software development; Waiting in software development.

• Team 3: Over-production in software development;

• Team 4: Over-processing in software development

• Team 5: Transport in software development; Defects in software

development;

Lesson Overview

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• Business Process Reengineering (BPR)

• Continuous Process Improvement (CPI)

• Principles of Lean

• Exercise

• Principles of Six Sigma

Lesson Plan Status

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A disciplined, data-driven methodology for process improvement

that focuses on satisfying customer requirements while

minimizing waste by reducing and controlling process variation.

2009 DoDI 5010.43

Six Sigma

Six Sigma evaluates a process in terms of performance,

accuracy, and consistency—Reduce Variation of Processes

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Variation Example 1

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Variation example 2

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Variation Example 3

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• What Is It?

- “Short Answer.” A change in the value of a measured characteristic

- “Long Answer.” The difference between things that are produced under conditions that are as nearly alike as it is possible to make them

- No two products or characteristics are exactly alike because any process contains many sources of variability

• General Principles

- No two things are alike

- Variation can be measured

- Individual outcomes are not predictable

- Groups form patterns with definite characteristics

Variation

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If special causes of variation

are present, the process

output is not stable over

time and is not predictable.

If only common causes of

variation are present, the

output of the process forms a

distribution that is stable over

time and is predictable

Variation: Common And Special Causes

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Six Sigma Methodology

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• BPR—fundamental rethinking and radical redesign of

business processes

• Lean—eliminating non value adding waste from our

process

• Six Sigma—reduce variation in key process attributes

leading to stable and predictable outcomes

CPI & BPR Review

Summary

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Today we learned to:

• Identify the DoD policy that describes the Implementation and Management of the DoD-Wide Continuous Process Improvement Program

• Define Continuous Process Improvement (CPI)

• Define Business Process Reengineering (BPR)

• Given a DoD IT/SW process scenario, apply various BPR/CPI method principles to improve business outcomes.

Overall Goal: Apply CPI concepts with the goal of improving the internal acquisition business processes of the government.