lean six sigma and procurement
TRANSCRIPT
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LEAN 6 SIGMA &
PROCUREMENT
PURPOSE – PROCESS – PEOPLE
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LEAN METHODOLOGY IS FOCUSED ON ELIMINATING WASTE
TYPES/FORMS OF WASTE:
Transportation
Inventory Motion Waiting
Overproduction
Overprocessing
Defects
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SIX SIGMA IS THE HIGHEST LEAN STANDARD
FOCUSED ON LOWERING VARIATIONSTO 3.4 DEFECTS
PER 1 MILLION OPPORTUNITIES
Example: In a manufacturing setting, for every 1 million products produced ONLY 3.4 items are produced with a defect.
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A commonly used methodology to achieving the 6 Sigma standard in
existing business processes is:
D M A I CDEFINE MEASURE ANALYZE IMPROVE CONTROL
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DMAICDEFINE the project goals and customer deliverables.
MEASURE the process to determine current performance.ANALYSE & determine root causes of the defects.
IMPROVE the process by eliminating causes of defects.CONTROL future process performance.
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Table and ChartLEAN 6 SIGMA APPLIES MAINLY
ON OPERATIONS
Procurement, being at the core of operations,
plays a vital role in achieving lean 6 sigma standards.
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Images Womack & Jones, authors of Lean Thinking, recommend that managers embark on lean transformations through the use of the
3 Ps: PURPOSE PROCESS PEOPLE
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ImagesPURPOSE OF LEAN IN PROCUREMENT IS TO..
Minimize time and effort required by
procurement processes. Minimize the risk of variations in process
and costs. Maximize efficiency and performance
levels.
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LEAN IN PROCUREMENT PROCESSES
RequisitionsRequests (RFQ/RFP)Purchase OrdersContractsOrder ReceiptsInvoice Payment
Processes include: Minimize waste within procurement processes that could occur in:
• TRANSPORTATION• INVENTORY• WAITING• DELAYS• OVERPRODUCTION• OVERPROCESSING
Use the DMAIC method to minimize defects within all processes.
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LEAN & PEOPLE IN PROCUREMENT
Approved suppliers list: single source of up-to-date data & KPIsItems Catalogs: single source of up-to-date data & KPIsPre-set templates with auto-fill features.Automated order approval routing.
Technology to Empower People
Budgets: control spending, and avoid maverick spend.Reports: measure, analyze data, and improve.User Permissions: full control over the process and access rights.Structured workflow to streamline processes.
Technology to Manage People
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& LEAN 6 SIGMATradogram takes the 3 Ps approach by:
Automating your procurement processes from end-to-end.
Minimizing effort and risk to improve efficiency and performances.
Ensuring that all communication with all stakeholders (internal & external) is streamlined and well documented.
Utilizing advanced cloud technology to ensure that you have the right amount of control, while giving everyone access to a
centralized system.