Improve Localization Efficiency Using Six Sigma (DMAIC)
MethodologyA case study on how the right strategy leads to a
scalable, sustainable solution for global organizations
6σ
Agenda Company Introductions Provide background into Process Excellence, Six Sigma and DMAIC Problem Introduction Walk you through how we used the DMAIC principles to resolve our
problem as well as share with you how it was utilized to deliver much needed improvement and sustainable gains.
What actions are being but into place to continue our overall improvement moving forward.
We will provide you with key learning's that you will be able to use immediately.
Most importantly, you’ll never look at supplier selection the same way again.
6σ
A business (quality) management strategy developed by Motorola in 1981.
The term SIX SIGMA originated from terminology associated with manufacturing processes where a sigma rating indicates a percentage of defect free products it creates.
Recognizing that correlation between higher quality and increased revenue, under the leadership of Jack Welch, Six Sigma was introduced at GE in 1995. From that moment, Jack Welch became the global promoter of Six Sigma.
In 2009 the value of Six Sigma was recognized by KCI’s Executive Committee and Process Excellence was listed on KCI’s Corporate Scorecard for the first time. To date, 7 Black Belts and 36 Green belts have been trained at KCI. This localization project is the 1st Black Belt project to achieve certification status at KCI.
Brief Evolution of Six Sigma
Understanding DMAIC…
6σ
Our ChallengeDefine
Prior to this project, when it came to localization, each functional group was focused on what "they" need to do without any leverage across KCI’s many functional groups and geographical areas.
These inefficiencies lead to… Inconsistency of Translated Content Process Inefficiencies Quality Issues Longer Lead-times Higher Translation Costs Delays w/New Product Launch and Global Expansion Plans
TRANSLATION SPEND
Impact to Patient Safety
Copy Inconsistency
Loss of Market Share
Non-Compliance PenaltiesMarket RemovalExpensive Fines
Launch Delays
Zero Leverage
Customer Dissatisfaction
Waste
Delays in Global Expansion Plans
Process Inefficiencies
Long Lead Times
Market Frustration
Rework
Higher Overall Costs
Secondary Expenses Associated w/Rework
Missed SalesOpportunities
And More….Negative Impact to Other Projects
False Positive in Low Cost Option
Define
The True Cost of Localization Compliance
Impact to Patient Safety
Copy Inconsistency
Loss of Market Share
Non-Compliance PenaltiesMarket RemovalExpensive Fines
Launch Delays
Zero Leverage
Customer Dissatisfaction
Waste
Delays in Global Expansion Plans
Process Inefficiencies
Long Lead Times
Market Frustration
Rework
Higher Overall Costs
Secondary Expenses Associated w/Rework
Missed SalesOpportunities
And More….Negative Impact to Other Projects
False Positive in Low Cost Option
Define
We Asked Our Leadership
Would it be acceptable for KCI to have 20+ suppliers for critical component items such as LCD screens for our VAC devices?
Then, why was an unmanaged, complex, multi-vendor environment acceptable for translated content directly impacting:
• Patient Safety• Customer Satisfaction• Quality & Compliance• Speed to Market• Market Expansion• Increased Revenue
Define
Project Charter Goals
Our team believed setting the right localization strategy would:
• Improve quality by significantly reducing variation of translated content by 30%.
• Improve cycle times by 30% by standardizing processes associated with translated content
• Increase translation memory leverage by 30% within and across functional groups assuring KCI the best net cost per "word".
• Transition from a multi source to a single source localization provider strategy.
Define
S I P O C
Need forTranslated
Content
GlobalTranslation
Management
Business Processes
Translation Request Forms
Source Documents
Approved Funding
Business Services and Supporting
Systems
Resources
Equipment(Hardware &
Software)
Supplier Input Process Output Customers
Translated Content that is…
Timely
Accurate
Consistent
Delivered at the best
net cost per word.
30%Estimated
Savings
Medical Professionals-Doctors-Nurses-CliniciansAt:-Hospitals-Skilled Nursing Ctrs.-Rehab Facilities-Home Care Facilities
Customers
Regulatory Bodies
Attorneys
Auditors
Distributors
Global Sales Force
OEMs
Multiple Cross-Functional KCI Process Owners
Verti
cal A
lignm
ent t
o KC
I’s O
vera
ll G
&O
1. Compliance2. Corporate
Communications3. Corporate Services4. Finance5. Global Product Labeling6. Human Resources7. Legal/IP8. LIFECELL9. Medical10. Portfolio & Branding11. Quality12. Regulatory13. Sales & Marketing14. Service Engineering15. Service Operations16. Training & Education17. Local KCI Affiliates18. Various Business Process
Support Staff
Key Metrics
CTQ’s
Define
Data Collection StrategyOnce the problem was accurately defined, the next step was to determine
the factors that have influence over our process and collect the data needed to support. The following key measures were selected:
Metric GPL Entire Process Top “3” Agencies
Current Efficiency Baseline(Net Cost Per Word)
P P P
Current Percentage of TM Leverage P P P
Estimated Cost Savings w/Existing TM P P P
Estimated Time Savings w/Existing TM P P P
Current % of Jobs Requiring ICR P P P
Quantify Errors: Contextual vs. Preferential
P P P
KCI ICR VOC Rating P N/A 2 of 3
True Cost of Quality N/A N/A P
All Key Measures Tie to DeliverablesImproved Cycle Time
Increased TM LeverageBest Net Cost Per Word
Supplier Reduction
Measure
Data Collection SummaryJun09-Feb10
DEFINE39 Projects
259,850Words
MEASUREANALYZE
55 Projects
265,169Words
IMPROVECONTROL
117 Projects
1,404,844Words
0
20
40
60
80
100
120
Measure
Impact to Patient Safety35%
Impact to Speed to Market30%
Existing Spend15%
Existing Con-trol by GPL
10%
Leverage Opportunities10%
Criteria & Weight Scoring Against Criteria
9 - High Impact6 - Moderate Impact3 - Low Impact0 - No Impact
Resulting Priorities1 - Labeling2 - Device Software3 - Medical
Data Evaluation CriteriaMeasure
Affinity Diagram
ContractsHR Materials
IncludingSoftware
AgreementsTraining
and EducationMaterials
Corporate Communications
RegulatorySubmissions
VideoMulti-Media
Journal Articles& Reports
LabelingContent
Sales & MarketingLiterature
Device Software
MarketResearch
DEFINE
Scientific Papers
Policies, Misc.Forms & More
Clinical Reports& Manuscripts
Analyze
Cost of Quality ModelFive Key Areas to Address When Improving the Cost of Quality (Page 38)
Key Drivers Basic Issue LSP 1 SDL LSP 3
Basic Organizational Capabilities
Skills & tools required to implement improvements in business processes are lacking.
6 0 9
Process Variations Poor process capabilities results in high COPQ (rework, multiple review cycles, longer cycle times).
6 3 9
Business ProcessVariation
Product cost estimation is often widely off the mark (additional funding is needed to complete job).
3 0 6
Process & Documentation
Systems, processes and documentation are often inadequate and flawed (longer cycle times, higher costs, poor quality).
6 0 9
Supplier Capabilities Lack of quality translators and supporting organizational support, resulting in poor-quality translations, late deliveries, higher costs.
6 3 9
Total – The higher the number, the lower the quality. The higher our overall cost!
27 6 42
Analyze
Key Findings (1 of 3)1) Obtaining financial data (US & OUS) to verify translation spend was
difficult at best. Issues included: No standard GL code for translated content Results varied between functional groups with access to financial data. Limited capabilities of existing systems. Independent stand-alone systems (US vs. EU and within the EU).
2) Every functional group expressed acknowledgment in their increased need for translated content.
3) Most importantly, the need for translated content will grow exponentially based on KCI expansion plans for both new and existing markets.
Analyze
Key Findings (2 of 3)
In-Country Review was the #1 reason for project delays.
KCI had no management strategy around TMs, terminology or style.
While translation costs represented 15% of KCI’s total annual localization spend, process & administration were as high as 40%.
Inconsistent writing styles and authoring make translations more expensive and impacts total translation costs by 25% or more.
Functional groups were focused on “low cost” without understanding the negative, long term consequences for both our localization strategy and organization overall.
Analyze
As budgets get tighter and both competition and project
timelines gets more aggressive, our ICR’s will have less
available time to review translated content at a time when
demand for translated content is increasing.
In short, while KCI has been operating as an international
company for years, our localization strategy was far from
global.
The time was right for this project!
Key Findings (3 of 3) Analyze
Key Learning to KCI’s ICR Process
Each ICR views and manages ICR differently.
Reviewers are not hired to review, it is an additional task to
an already heavy workload.
Reviewers change numerous times within a calendar year.
ICR’s received no formal training or testing for their role
(including minimum skill requirements (i.e. English
Proficiency/Product Knowledge).
ICR had to change!
Analyze
Expected Deliverables
• ONE: Improve quality by significantly reducing variation of translated content by 30%.
• TWO: Improve cycle times by 30% by standardizing processes associated with translated content
• THREE: Increase translation memory leverage by 30% within and across functional groups assuring KCI the best net cost per "word".
• FOUR: Transition from a multi source to a single source localization provider strategy.
E = c x qr x trw
• E = Efficiency of our TM program• c = Total cost• qr = Quality Ratio of the Translation• tr = Time Ratio• w = Total Words Translated
Improve
Improvement Goals (1 of 2)
• Redesign the entire translation process– eliminate MUDA!• Introduce Improved Technology• Develop/Execute TM Strategy – More than Trados!• Maximize Reuse of English Source Content• Create KCI Training & Education Library• Optimize ICR Process• Introduce Style Guide & Glossary of Terms• Internal Training: Write for a Global Audience• Improved cost structure/pricing for KCI jobs• Develop/implement tools to better manage terminology and
style
Improve
Improvement Goals (2 of 2)
While this project was focused on managing translated content more
effectively, the long-term picture is about understanding and
optimizing the entire content lifecycle, including source authoring
and content management.
Improve
Cycle Time – Labeling Content
6σ
LW VSM3.igx
Customer Demand:
2000 Words/Day Customer
RFQ to PO
Total C/T = 3 daysNVA = 2.5 days
Value Add: 0.5 days
Defect = 15%
C/O = 30 mins.Uptime = 95%
Availability: 90%
4
Prepare & Fwd.
Completed Files
Invoice & COA
Total C/T = 0.75 days
NVA = 0.25 days
Value Add: 0.5 days
Defect = 5%C/O = 1 mins.
Uptime = 95%
Availability: 90%
2
TRANSLATION
MANAGEMENT
Supplier
Information
Quote Request
Submitted
Information
0.5 days
3 days
0.75 days
1 days
9 days
12 days
2 days
2.5 days
1.5 days
2 days
6 days
7 days
1.5 days
2 days
3.25 days
4 days
0.5 days
0.75 days
8 days
10 days
1.5 days
2 days
1.5 days
2 days
0.5 days
2 days
2.5 days
3 days
0.5 days
0.75 days 54 days
VA / T = 39.5 days
NVA = 14.5 days
Total C/T = 54 days2.5 days 0.25 days 3 days 0.5 days 0.5 days 1 days 0.5 days 0.75 days 0.25 days 2 days 0.5 days 0.5 days 1.5 days 0.5 days 0.25 days
23000 pcs
Information
Prep Files
Total C/T = 1 days
NVA = 0.25 days
Value Add: 0.75 days
Defect = 5%Uptime = 99%
Availability: 100%
1
Quote Processed
PORTAL
Translation
Total C/T = 12 days
NVA = 3 days
Value Add: 9 days
Defect = 5%Uptime = 95%
Availability: 95%
12
Editing
Total C/T = 2.5 days
NVA = 0.5 days
Value Add: 2 days
Defect = 5%Uptime = 95%
Availability: 90%
12
Proofreading
Total C/T = 2 days
NVA = 0.5 days
Value Add: 1.5 days
Defect = 5%Uptime = 95%
Availability: 90%
12
Typesetting
Total C/T = 7 days
NVA = 1 days
Value Add: 6 days
Defect = 10%Uptime = 95%
Availability: 90%
2
Quote
Received
Linguistic
Proofreading
Total C/T = 2 days
NVA = 0.5 days
Value Add: 1.5 daysDefect = 5%
Uptime = 95%
Availability: 90%
12
Graphic
Proofrading
Total C/T = 4 days
NVA = 0.75 days
Value Add: 3.25 daysDefect = 5%
Uptime = 95%
Availability: 90%
1
ICR
File Prep
Total C/T = 0.75 days
NVA = 0.25 days
Value Add: 0.5 daysDefect = 5%
Uptime = 95%
Availability: 100%
1
ICR
Review
Total C/T = 10 days
NVA = 2 days
Value Add: 8 daysDefect = 3%
Uptime = 90%
Availability: 66.6%
12
Apply
Changes
Total C/T = 2 days
NVA = 0.5 days
Value Add: 1.5 daysDefect = 5%
Uptime = 99%
Availability: 99%
2
Final QA
Check
Total C/T = 2 days
NVA = 1.5 days
Value Add: 0.5 daysDefect = 5%
Uptime = 99%
Availability: 99%
1
Update
TM
Total C/T = 3 days
NVA = 0.5 days
Value Add: 2.5 daysDefect = 0%
Uptime = 95%
Availability: 95%
1
Lean
Opportunity
Glossary
Style Guide
Increased
TM
Resolve
Disputes
Total C/T = 2 days
NVA = 0.5 days
Value Add: 1.5 daysDefect = 3%
Uptime = 95%
Availability: 90%
8
High
Impact
Portal
More
Reusable
SourceContent
Key Terms
Training &Education
After Process Excellence
11 Process Steps
Total Cycle Time = 34.6 Business
Days
37%Cycle Time
Improvement
Before Process Excellence
15 Process Steps
Total Cycle Time = 54 Business
Days
Improve
Cycle Time Software: Before PE
Before Process Excellence
Very Manual/Labor Intensive
Total Cycle Time = 82-104 Business Days
(w/o Counting Multiple Review Cycles)
Improve
Cycle Time After PE – Pilot Project
Label Copy Approval
Translation Work Flow
Glossary
TM
KCI ICR
PM Led Web EX
Linguistic QA
Delivery Validation
Release
.TXT Files
ITD’s
Passolo
Screen Designer Input
Resizing
Linguistic Testing
Functional TestingTechnology Work Flow
Better Tools Improved Technology
Aligned CoreCompetencies
DedicatedFTE COESupport
Estimated Revenue Savings
$1,312,500
Improve
Improvements – Translation Memory
Before PE, our TM leverage averaged at 11.5%.
At the end of 2009, we were able to increase our TM leverage to
15% and meet our goal.
As of March 1, 2010, our leveraged reached 32%.
An increase of 180%!
Our two-year goal is to reach a leverage of 75% or more.
2010 YTD Savings43% TM$130K
Improve
Improvements ContinuedImprove
Improved Communication (Completed): Provided KCI w/an internal centralized contact for localization mgmt.
Automated Job Submission (SDL Technology – In Process): Reduced cost of localization and improve cycle times through
automation of previously manual, administrative tasks.
Promotes a unified (process driven) supply chain.
Promotes visibility into localization process which leads to improved
time management, increased accessibility and overall better control.
Improvements ContinuedImprove
Improve KCI’S “Net Cost” (The Big “E”): Q110 Glossary Growth Rate: Increased 29% within 1st 9 months
(Completed)
Increased TM Leverage and Glossary (On-Going)
Style Guide Creation/Translation – Creation & Growth (On-Going)
ICR Improvements (1 of 2)Improve
Most importantly, while ICR is NOT a regulatory requirement, KCI and
SDL recognize the value it provides (corporate image, regional buy in
and risk reduction).
Within SDL’s normal business process, upfront involvement with each
applicable ICR is key. This includes e-mail notification when a new job
requiring ICR is received as well as close collaboration between SDL
and KCI ICR’s throughout the course of the project.
ICR Improvements (2 of 2)Improve
Glossary: Working closely with GPL and KCI ICR’s, SDL created a
glossary of terms which are reviewed on a regular basis throughout
the year.
Style Guide & ICR Training Guide - In process
WEB EX Technical Product Sessions – Active
By blending best practices between KCI and SDL, when ICR is not
possible, we have successfully reduced risks associated with both late
ICR and poor translations.
Improvements –Supplier ReductionImprove
“Translation spend is a critical strategy and needs to be dealt with tactically.”“Real candidate for supplier reduction.”
- George Bordon, KCI VP Procurement
In addition to savings obtained though PE based improvements, we engaged our legal and global procurement groups to assist in our supplier reduction efforts including:• Pricing Negotiations• Functional Stakeholder Engagement Across the Globe
Control PlanControl
Monthly Metrics: Translation Spend, TM Leverage, Time and $$$ Saved,On-Time Delivery, Quality)
On-Going Software & Localization Process ImprovementsWeekly Supplier MeetingsQuarterly Business Reviews: GPL, Procurement and SDLSustaining Supplier Reduction Efforts Legal Receipt/Contract Review – Non Approval EC PE Presentation to Procurement Council Global Procurement Led Initiatives Corporate Communication Avenues
SDL: A Strategic Six Sigma Partner
EDUCATION:SDL ensures that each person in the supply chain has a clear understanding of
their role and the required training to perform tasks with both accuracy and precision.
PROCESS ENGINEERING & RE-ENGINEERING:Continual review of documented processes to mitigate potential waste from
non-automated tasks, including waiting, motion and processing waste.
APPROPRIATE USE OF AUTOMATION:Intelligent use of technology to automate the appropriate localization
processes to optimize ROI, as well as focus on waste reduction in the areas of resource inventory, asset transportation and correction.
Control
SDL = COE for Language ManagementHelping corporations drive global revenue
and reduce cost by providing software and services to deliver global content.
SDL’s global infrastructure aligns well withKCI’s globalization plans.
ControlContinuous Improvement InitiativesInconsistent writing styles and authoring make translations more expensive and impacts total translation costs by 25% or more. KCI has enlisted SDL to optimize upstream processes to:
• Train KCI authors to write for a global audience (controlled authoring)
• Train KCI authors to write in one “KCI” voice to ensure seamless use of shared content (voice unification)
ControlContinuous Improvement InitiativesThe intelligent application of technology is game changing and transformational. It will improve our efficiency by an order of magnitude and drive down our costs.
KCI is working with SDL to create a complete services and technology platform to optimize current and future needs• On-going author training• KCI is moving to DITA-based authoring tools,
and utilizing SDL Trisoft™ for Component Content Management.
In Summary…
We’ve increased your knowledge surrounding Process Excellence, Six Sigma and DMAIC
Through a real world problem, we’ve illustrated how DMAIC principles can be applied to localization and that the sustainable gains can be achieved.
Provided you with key learning's that you can apply to your business.
Most importantly, you’ll never look at supplier selection the same way again – the pain is worth the gain!
6σ
Questions?
Recap Project Deliverables – Expected Results
1. Improve cycle times by 30% or more.
2. Maximize reuse of localization content by increasing Translation Memory leverage (TM) by 30% or more.
3. Supplier Reduction4. Overall, assure KCI receives the best
“net-cost” per word with our translation $$$. Show target. (Improve the big “E.”)
