Baxter Business Excellence Model

E B X B U C A S E X I L T N L E E E R S N S C E
Baxter Business Excellence Model

Michael R. Whisman Director, Quality Baxter Healthcare Corporation
Michael (Mike) R. Whisman

Ex-Army Captain (Viet Nam Era) Over 33 Years Healthcare Industry (Manufacturing & QA)
Chairman, ASQ Team & Workplace Excellence Forum (2008 2009) BS Management (Texas A&M) MBA Pepperdine Univ. 6-Sigma Black Belt Baxter Master Black Belt 40 Years - Married 2 Grown Kids, 1 New Grandson & Puppy

20 Years at Baxter

Baldrige Examiner (1997 2009)

Shingo Examiner (2005 2009)

ASQ ITEA Judge (2002 2009)

Copyright 2006, Baxter International, All Rights Reserved
Questions

How many are implementing models? What kind of issues do you face? How many believe you have to have support from the top to successfully implement?
Lets take a look at the model we use at Baxter
MODEL - OVERVIEW
Baxter Business Excellence Model Complete View

Strategic Challenges Strategic Objectives Value Streams & Key Metrics
A S S E S S A L I G N
Improvement Opportunity Identification and Prioritization Lean Six Sigma DFSS / DMAIC Methodology Tool Set Total Employee Involvement Tangible, Verifiable Results
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I N T E G R A T E
Baxter Business Excellence Model With Pictures

Strategic Challenges Strategic Objectives Value Streams & Key Metrics Improvement Opportunity Identification and Prioritization Lean Six Sigma DFSS / DMAIC Methodology
6W * Kaizen ** Lean ***
Provides focus, ensures alignment of all employees towards common goals, timetables and targets.
Total Employee Involvement Tangible, Verifiable Results

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TOOLS * Six Sigma Variation ** Kaizen Quick Change *** Lean Waste
Strategic Challenges and Objectives

Internal Strategic Challenges
Strategic Challenges
1. Operational 2. Organizational 3. 4. Business 5.
External Strategic Challenges

Customer 6. Competitor/Market 7. 8. Supplier 9. 10.
Key Strategic Challenges Key Strategic Objectives
Strategic Objectives
1. 2. 3. 4. 5.
Note: Strategic Objectives can cover multiple Strategic Challenges 7


6W Kaizen Lean
Map processes that support key strategic objectives and create customer value. Include baseline on key measures and targets for improvement; lead time, cost, quality, yield, etc.

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Value Streams and Key

Internal Strategic Challenges
Strategic Challenges
1. Operational 2. Organizational 3. 4. Business 5.
Metrics
External Strategic Challenges
Customer 6. Competitor/Market 7. 8. Supplier 9. 10.
Key Strategic Challenges Key Strategic Objectives
Key Metrics: Targets:
1, 2 A, B
1 A
1, 2 A, B
Value Streams and Key Metrics

Move from departmental thinking
Sales & Marketing
Manufacturing
Environment, Health, &Safety
Finance
Product Developmen t
Information Technology
Quality & Regulatory
Supply Chain
Human Resource s
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Value Streams and Key Metrics

.To process thinking driven by key metrics with customer and business excellence line-of-sight
EH&S Quality & Regulatory Supplier Product Development Sales & Marketing
Value Creation
Product Manufacturing Supply Chain
Customer
Human Resources Finance

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Information Technology
Example Value Stream Map

Supplier
PRODUCTION CONTROL
Market Changes Sales Data
MRP
Market Intelligence Distributors
Weekly Schedule
Weekly Material Shipment
Process Step #1
Process Step #2
Process Step #3
Process Step #4
I
300 units C/T = 10 sec C/O = 1 hr Uptime = 85% Yield = 70%
I
I
I
Non-Value Add 50 min. 25 Min. 25 min. 50 min PCT = 151.5 mins Value Add 10 sec. 30 sec 30 sec. 20 sec. VAT = 1.5 mins
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Opportunity Identification
6W Kaizen Lean

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Value Stream Map: Three Primary Purposes

Value Stream 1
Value Stream 2
1.
To engage the organization in process thinking and continuous improvement 2. To identify improvement opportunities through process understanding 3. To manage all improvement efforts toward meeting all key metric targets
Value Stream 3
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Opportunity Identification, Prioritization and Project Selection

Value Stream 1
0-6 12 months months future future state state Quick Hit Quick Hit Kaizen Kaizen Project 6-Sigma 6-Sigma Kaizen
24 months 36 future months state ideal state 6-Sigma Project Kaizen 6-Sigma Project Project Project 6-Sigma
Measure Improvements Against Key Metrics and Strategic Objective

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Strategic Challenges Strategic Objectives Value Streams & Key Metrics Improvement Opportunity Identification and Prioritization Lean Six Sigma DFSS / DMAIC Methodology 6s Kaizen Lean Total Employee Involvement Tangible, Verifiable Results
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Mechanism to drive improvement. Standardized methodology and language: Define, Measure, Analyze, Improve, Control. Lean Six Sigma Toolkit.
Value Analysis

Value Added Activities

Activities essential to deliver product or service according to customer requirements. Three criteria:

Transforms the item or service toward completion Customer cares (would be willing to pay for it) Done right the first time
Non-Value Added Activities

All other activities. These activities are considered waste.
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Baxters 11 Wastes
Overproduction Waste is anything other than the minimum Waiting amount of equipment, materials, parts, space, and workers time which are Transportation absolutely essential to add value to the Excess Motion product. Shoichiro Toyoda - President, Toyota Injuries Inadequate procedures/methods (processing waste) Unplanned Activities (processing waste) Inventory Poor Communication Defects (not meeting customer requirements) Variation
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Definition of Waste
Lean Six Sigma

Strategic Challenges Strategic Objectives Value Streams & Key Metrics Improvement Opportunity Identification and Prioritization Lean Six Sigma DFSS / DMAIC Methodology 6W Kaizen Lean Total Employee Involvement Tangible, Verifiable Results
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Tools
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What is Lean Six Sigma (LSS)?

Lean
A focus on waste elimination, standardization, cycle time reduction, smooth process flow etc.
Six Sigma
A focus on variation reduction that impedes optimized performance.
Lean Six Sigma is a robust, data-driven approach to dataimprove and manage key business processes.
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The Methodology: DMAIC

DEFINE
... define the problem, clearly and related to customer... ...measure what you care about; know your measure is good... look for root causes; generate a prioritized list ... determine and confirm the optimal solution ... be sure the problem doesnt come back...
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IMPROVEMENT CYCLE MANAGE
MEASURE
ANALYZE
IMPROVE CONTROL
The Tools: LSS Toolkit

DEFINE
Is/Is Not Diagram SIPOC Process Flow Chart Value Stream Map Kaizen 6S NPV Surveys VOC/CTQ Kano Model
MEASURE
Boxplot Dotplot Charts Pareto Chart CTQ Project Y MSA Gage R&R Drilldown Process Capability Study
ANALYZE
Brainstorm Fishbone FMEA Affinity Multi-Voting Scatter Pareto Chart Fault Tree 5 Whys
IMPROVE
DOE MistakeProofing Standard Work Flexible Workforce Visual Mgt. TPM
CONTROL
Control Plan Operating Procedures Revised Process F low Project Decommissioning
Level 6-Sigma Tests Loading Takt Time Pull/Kanban

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Strategic Challenges Strategic Objectives Value Streams & Key Metrics Improvement Opportunity Identification and Prioritization Lean Six Sigma DFSS / DMAIC Methodology 6W Kaizen Lean Total Employee Involvement Tangible, Verifiable Results
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Allocation of the appropriate resources and engagement of the entire organization.
Achievement of results directly supporting the organizations strategic objectives.
Business Excellence Model Align - Integrate - Assess

Strategic Challenges Assess progress Strategic Objectives toward goals. Value Streams & Key Metrics
A S S E S S A L I G N
Opportunity Identification, Refine based upon Prioritization, and Project Selection results and changes to Six Sigma Leanstrategic challenges and DFSS / DMAIC Methodology strategic objectives.
6W Kaizen Lean

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I N T E G R A T E
MODEL - DEPLOYMENT
Baxter Efforts 25+ Years
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Questions

How many have tried to implement a business model in your company and were successful right out of the gate? How many have tried to implement a business model and slammed full on into cultural issues:
Were different Tried it before and failed

That stuff wont work here
How many have actually made some inroads with employees, only to see stubborn leaders kill the motivation?
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Deployment Resources & Brief History

Initiated QLP in mid-80s World-wide Deployment

QLP Sr. VP reporting to CEO Millions in Funding
64 Full time Director/Coaches to deploy program All Leaders sent to Crosby School in Florida

Issues
Deployment to manufacturing world-wide. Division Leaders made an effort. Merger of Baxter and American Hospital Did not include Technical Areas (i.e. R&D, IT, Finance, etc.)

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Model History

Initiated QLP (Total Quality) in mid-80s World-wide Deployment

QLP Sr. VP reporting to CEO Millions in Funding
64 Full time Director/Coaches to deploy program All Leaders sent to Crosby School in Florida

Initiated Baldrige Approach (1989) Global intent

Deployment to manufacturing world-wide. Some Division Leaders were successful.
Four Full-time VPs, an award office of staff & 200+ Examiners Leaders asked QLP or Baldrige, which one?

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Model History

Some Key Plants Initiated Shingo (2000)

Success - Manufacturing Plant Level Not much interest elsewhere
Merged Shingo with Baldrige Approach (2005 Present)

Builds on everything we learned thus far Leaders at Many Levels of the Organization Interested Lost enough, we are starting over in many areas

Manufacturing Plants still generally the best examples Great efforts being made in Quality Organizations

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Model History

Lean (2002)

Success in Some Manufacturing Plants One Key Leader
Business Excellence (2002)

One Sr. VP reporting to Corp. Quality VP Eleven Person Corporate Group Five Gurus with five coaches in training. Strongest Support in Manufacturing & Quality IT, Finance, Supply Chain, & a Division are Developing

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Pitfalls We Experienced

QLP - Not Training Everyone at Once
Baldrige Model Placing it in competition with QLP Seeing LEAN, Six Sigma, Kaizen, etc. as Models Succession Planning Failure to consider culture/style Reduction in Organizational Resources

Decentralization Program not reporting to the top

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What We Did Right

Stuck With IT Saved Millions, Developed & Maintained a Core Competence in Manufacturing Merged it all Together

QLP Culture Baldrige/Shingo Model Fits Partial & Complete Organizations 6-Sigma/Lean/Kaizen/Etc. as Tools
Implementation Anywhere There is Interest Using Examples of Success to Tempt Leaders

Practicing What We Preach Baxter is Charging for Success

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Baxter Business Excellence Model

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