lean six sigma project charter creation process

7/29/2019 Lean Six Sigma Project Charter Creation Process

1/8

Project Charter Development Steps

A. Before Beginning a Project Charter:

1.

Convert Your Business Problem Into a Process Problem

Most projects begin with a business problem (e.g. inventory levels or departmental costs are too high, etc.). This is anatural starting point. But before a Lean Six Sigma (LSS) project can be properly defined, the business problemmust be converted into a process problem (i.e. identifying which poor performing process is driving our businessproblem. It is the broken process on which we want to focus our charter development efforts. There may in factbe several processes contributing to our single business problem. These processes must be prioritized in order oftheir contribution to the problem, with each of them potentially becoming unique projects.

2. Draft a SIPOC for the ProcessFocus less on detail focus more on identifying primary Suppliers, Inputs, Outputs and Customers. Further, be veryexplicit about defining the exact starting and ending points of the Process.

3. Complete aProcess Map for the P of SIPOC

Stay at a level of detail at which everyone can agree on the process 10 -20 activities or tasks.

This is in fact the beginning ofwhats called Vertical Scoping (reference the Project Chartering module ofLeadership & Project Sponsor training).

4. Develop Initial Process Metrics

Focus on the IPO of SIPOC (see below), identify relevant metrics pertaining to Quality, Speed, and Cost. Referencethe Project Chartering module of Leadership & Project Sponsor training if there is confusion regarding the differencebetween Process Metrics and Business Metrics.

Developing Process MetricsAn Example SIPOC and Metric Development


2/8

Project Charter Development Steps

B. Develop Project Charter (in the following sequence):

1.

Draft the Problem/Opportunity Statement

Theres no need to write a paragraph. Simply define the problem or opportunity, as succinctly as possible, in termsof Who, What, When, Where, and Extent.

a. Who/WhereWho is experiencing the pain, and where is it being felt? This is the beginning ofwhatscalled Horizontal Scoping, which assists in creating a manageably sized, focused project (see ProjectSponsor training for definition ofHorizontal Scoping.

b. WhatHow is the pain being recognized or felt effectively the Process Metrics defined earlier in theSIPOC output metrics(Ys) area.

c. WhenWhen did the pain begin? This could be as simple as as long as we know .This should be as specific as possible. How long has the problem been around?

d. ExtentHow badly are we hurting in terms of the Process Metrics defined earlier and some baseline levelof performance on those Process Metrics

As with all quantifiably measurable components of a charter, you may initially leave blanks orplaceholders until data can be collected and processed. All placeholders must be filled in before thecharter is complete.

2.

Draft the Goal Statement

Simply articulate improvement expectations in terms ofthe Process Metrics defined in the Problem Statement. Awell developed Goal Statement is realistically achievable and properly coordinated between Sponsor and ProjectTeam. Ask yourself the following questions:

When is this project successfully done and how will you know? How does this tie back to the problem statement (Process Y) and the SIPOC output metric? What are the specifications for the process Y (Customer Requirement)?

3. Complete the Project ScopeThe beginning and ending steps of the process identified in the P of SIPOC and the Process Map accomplished


3/8

Project Plan

Black Belt projects:Unless you know when the project is going to start and the projected toll gate review dates, dont use actual dates.Write in exactly the following:

Define Tollgate: Project start + 1 month Measure Tollgate: Project start + 2 months Analyze Tollgate: Project start + 3 months Improve Tollgate: Project start + 4 months Control Tollgate: Project start + 5 months

GB projectsAgain, unless you know when the project is going to start and the projected toll gate review dates, dont use actual

dates. Write in exactly the following: Define/Measure TollgateProject start + 1 month Analyze/Improve TollgateProject start + 2 months Control TollgateProject start + 3 month

Kaizen events:When will the Kiazen Event take place?

5. Team SelectionAt this point, only identify roles, functional or competency participants, not actual names, unless you are sure thatyou know who they are. The names should be in place by the time of Team Launch

Identify the Core Team, and the Extended Team. Extended Team should include resource names only.

The Core Team should represent the key Stakeholders in the process

For a Black Belt project, if more than 4-5 Core team members, then scope is likely too large.

For a Green Belt project, if more than 2-3 Core team members, then scope is likely too large

6. Signatures


4/8

PROJECT CHARTER EXAMPLE (p. 1)

Project Title: Improve the effectiveness and efficiency of the Black Belt computer acquisition process Author (Project Sponsor): John DoeDeployment Champion: Joe Schmoe

Competency/PEO: CIODate of Last Update: 1/21/2010

Business Impact

This project will address the computer acquisition process for LSS Black Belt training courses. The first two classes of traininghave experienced delays and customer dissatisfaction due to late delivery of computers and class disruptions to load requiredsoftware. Due to exceptional work by Tom Morrow, the first two classes were able to receive their computers during week 1 oftraining, but since pre-work is required before attending week 1 of training, it is ideal for the BBs to receive properly loadedcomputers during Team Leadership training.

The impact of late computers in worker non-productivity costs, expediting costs, possible higher computer costs, and customerdissatisfaction estimated at:

$12K of Type 1o Assumptions - 6 classes of BB training over the next 12 months following completion of project, $2000/class of

additional computer costs for expediting, etc. $48K of Type 2

o Assumptions - 6 classes of BB training over the next 12 months following completion of project, 40 hours ofextra expediting and handling per class, $75 per hour of labor

Other Benefits (Type 3)

o Increased student learning and ultimately better project success

Problem Statement

Who/Where:The problem has been noticed at San Antonio, Texas Training Center, the only training location to-date

What (Process Metrics):Quality 1: %of properly loaded laptop computers with Minitab as measured by (% computers loaded properly 1

sttime)

Quality 2: % Computers delivered by day 1 of Team training as measured by: (% of total computers delivered late)

Cost Efficiency: Costs should not include expediting, temporary computer costs, or excessive labor costs. Actual costs tobe determined later as measured by: (Total costs of computer readiness divided by total computers delivered)

Cycle time: % of computers properly preloaded by the first week of training


5/8

PROJECT CHARTER EXAMPLE (p. 2)

Project Scope

In Scope:This project will address the laptop computer acquisition process for LSS BB classes 1-10. The process will begin withthe scheduled training date and end when a BB receives the computer the first day of Team training.

Out of scope:This project will not address network log-in logistics, Green Belt courses or any other course requiring computers.

Project Plan

Define Tollgate: Project start + 1 monthMeasure Tollgate: Project start + 2 monthsAnalyze Tollgate: Project start + 3 months

Improve Tollgate: Project start + 4 monthsControl Tollgate: Project start + 5 months

Project Team

Project Sponsor: John DoeBlack Belt: Joe BlackbeltTeam Members:

IT person 1IT person 2ProcurementContractsSubject Matter Expert (SME) Expert


6/8

6

Lean Six Sigma Project Charter Template

Project Name: Rev No: Date:

Dept.: Deployment Champion:

Project Sponsor: Black/Green Belt:

Business Impact ($ = Business Metric)Why are you doing this project (What is the pain at the high level) (The primary business reasons)?

What happens if you do not do this project?What strategic lever does this project address? (Which Products/Services are being improved?)

$__________ of Type 1 (Hard/Direct Dollars)o Assumptions

$__________ of Type 2 (Soft/Indirect Dollars)o Assumptions

$__________ of Type 3 (All other Benefits)o Assumptions

Opportunity or Problem Statement (Process Metrics)When: When did this process problem first occur and how far back are you going to collect data?What: What are the process problem metrics (Quality, Speed, Cost)Choose your Project YWho: Who is the customer that benefits from this process

Where: Where is this process problem occurring (SIPOC)Extent: Quantify the extent of each process metric (Quality, Speed, Cost)SIPOC output metric

Goal Statement (Process Metrics)a. Big Y metric: State the one primary measurable, operationally-based performance gap to be closed by this project (e.g. reduce cycle time

from 60 to 10 days).b. Little Y metrics: State the secondary performance goals to be achieved by this project.c. List potential input variables that may influence the Big Y metrics (i.e. Y= f(x))

Project Scope (Horizontal and Vertical Scoping)a. What organizations, locations, outputs, funding sources, etc. are specifically includedin this project?

What are the start/stop boundaries of the project?b. What organizations, locations, outputs, funding sources, etc. are specifically excludedfrom this project?

What are the project constraints?

Project Methodology:DMAIC DFSS Kaizen

Project Planlist planned dates for each DMAIC phase (Kaizenlist start and end dates)

Define: ____/____/____ Measure: ____/____/____ Analyze: ____/____/____ Improve: ____/____/____ Control: ____/____/____

Team Selection; Cite names of core team members, including their commands, areas of expertise, and % of weekly contribution expected onthis project:Name: Command: Project Role (Expertise): % Contribution:

Signoff: ____________________ _____________ ________ _______________________ _____________________Master Black Belt Project Sponsor Deployment Champion Financial Rep


7/8 7

Business Impact Details Type 1: Describe the chain of causality that shows how you determined the Type 1 savings. (tell the story with causeeffect

relationships, on how the proposed change should create the desired financial result (savings) in your project )

Show the financial calculation savings and assumptions used.

Assumption #1 (i.e. source of data, clear Operational Definitions?)

Assumption #2 (i.e. hourly rate + incremental benefit cost + travel) Type 2: Describe the chain of causality that shows how you determined the Type 2 savings. (tell the story with causeeffect

relationships, on how the proposed change should create the desired financial result (savings) in your project )

Show the financial calculation savings and assumptions used.

Assumption #1 (i.e. Labor rate used, period of time, etc)

Assumption #2 (i.e. contractor hrs or FTE, source of data, etc)

Describe the Type 3 Business Impact(s) areas and how these were measured

Assumption #1 (i.e. project is driven by the Business strategy?)

Assumption #2 (i.e. Customer service rating, employee morale, etc)

Other Questions

Stakeholders agree on the projects impact and how it will be measured in financial terms?

What steps were taken to ensure the integrity & accuracy of the data?

Has the project tracking worksheet been updated?


8/8 8

SIPOC MapSuppliers Inputs Process Outputs Customers

? ? ?

? ? ?

? ? ?

? ? ?

Start

Step1Step 2 Step 3 Step 4

Step 5Step 6Step 7Stop

Step 8

Input Metrics Process Metrics Output Metrics

Quality

Speed

Cost

? ?

?

? ?

?

? ?

?

? ?

?

? ?

?

? ?

?

? ?

?

? ?

?

? ?

?

lean six sigma project charter creation process

Documents