Magesh ManiSohel ImrozUdaya Vangipurapu

4/27/2005

Improving IT Application Services with Six Sigma

AgendaAgenda

Introduction Six Sigma process Synergy with IT Service Management Case Study Conclusion

IntroductionIntroduction

• Fastest growing business management system

• Developed by Motorola

• Popularized by GE

IntroductionIntroduction

• The process cannot produce more than 3.4 defects per million opportunities

• Two different processes in Six Sigma– DMADV- Define Measure Analyze Designs Verifies

the target processes; for new processes

– DMAIC- Define Measure Analyze Improve and Control the target process; for existing processes

Six Sigma processSix Sigma process

Define PhaseDefine Phase

• Core processes

• Scope of the project

• Requirements

• Resources

• Organizational support

• Tools: Project Charter, Process Flowchart

Measure PhaseMeasure Phase

• Quantify and benchmark using actual data

• Average performance, variation

• Process capabilities

• Data collection plan

• Detailed process map

• Tools: Process Flowchart, Benchmarking

Analyze PhaseAnalyze Phase

• Apply statistical tools

• Identify root cause of problem

• Formulate opinions for improvement

• Hypothesis testing

• Tools: Histogram, Pareto Chart, Regression Analysis, etc.

Improve PhaseImprove Phase

• Ideas and solution put to work• Find the best solution• Experiment and trials• Develop standards and procedures• Finalize documentation• Celebrate!!• Tools: Control Chart,

Cost Savings calculation

Control PhaseControl Phase

• Performance tracking mechanisms and measurements

• Maintain the gains made in the project

• Implement the knowledge in other parts of the organization

Synergy with IT Service ManagementSynergy with IT Service Management

Any IT driven organization is expected to have corporate IT good practices, which is the focus of Organization’s IT Service Management strategy

“ITSM is a method to manage IT Service Provisioning across the enterprise and through a full cycle of Service Delivery and Service Support. By nature it uses best practices to manage the balance between Quality of Service and Cost of Service, with a focus on the profitability of the IT customers.”

As discussed, Six-Sigma- a management’s initiative for quality improvement and cost reduction.

Both focus on Quality and Cost Reduction.

Benefits of leveraging Six Sigma with ITSMBenefits of leveraging Six Sigma with ITSM

Provide better insight into the activities related to delivery and IT support services to the IT management

Providing consistent IT support for critical business functions with better service quality.

Benchmarking an accurate customer expectation level Improving the customer satisfaction experience for all the IT services

provided to them. Improved understanding of the existing and proposed IT service capability

and requirements. Better alignment of the personal effort linkage with the success of the

business and to the value of IT services. Increased implementation time to incorporate the changes for a better

success rate Usage of proven best practices to gain operational effectiveness in various

processes of the business.

Case Study - 1Case Study - 1

Challenge: Improve IT service management practices internally

Solution:Combining Six Sigma and ITIL® to improve IT service management at GE

Business Value:Reduced Cost, Enhanced decision making ability, Improve IT service levels by creating operational efficiencies enabling a linked IT Service Management process loop for defining, measuring, analyzing, improving, and controlling service performance

Cost Savings:Saved $12 billion over five years and added $1 to earnings per share.

GoalsGoals

IT Consulting group at GE had the following goals:

Achieve ISO compliance Leverage ITIL® best practices Determine the current state of IT service Continually improve Establish ongoing measurements to ensure improvement/control

1 1 - DEFINE OPPORTUNITIES- DEFINE OPPORTUNITIESThe team produced 5 deliverables in the Define phase:

• Team Charter– describes the purpose, goals, and resources for the project

• Data Collection Plan– that includes such items as interview schedules and questions

• Critical to Quality (CTQ) outline– that identifies the critical success factors

• Current Situation Analysis– that was created using the CAT tool

• “as-is” Process Map Outline– that provides an understanding of the current processes to which the solution has to

be aligned

2 2 – MEASURE PERFORMANCE– MEASURE PERFORMANCE

The team produced 3 deliverables in the Measure phase:

• An accurate assessment– Of current process performance

• Detailed “as-is” process maps– Based on the outline created in phase-1

• Critical success factors (CTQ) summary chart– Based on the Critical To Quality outline

3 3 – ANALYZE FACTORS – ANALYZE FACTORS IMPACTING PERFORMANCEIMPACTING PERFORMANCE

The team produced 4 deliverables in the Analyze phase:

• Identified major process gaps– Created am “opportunities table” that provides solutions to map the

process gaps.

• Critical success factors (CTQ) benchmarked against IITL– To identify opportunities for improvement

• Created a Cause and Effect diagram– To demonstrate the effect of efficient process

• Pareto Chart for opportunities

4 4 – IMPROVE PERFORMANCE– IMPROVE PERFORMANCE

The team produced 3 deliverables in the Improve phase:

• “to-be” process maps– Were created based on innovative and cost effective ideas

• Prioritization– Of potential Solutions based on the ROI

• Improvement in the following:– Risk assessment– Failure Modes and Effect Analysis (FMEA)– Contingency Plan

• Creation of Solution Pilot

5 5 – CONTROL PERFORMANCE– CONTROL PERFORMANCE

The team produced 5 deliverables in the Control phase:

• Implemented full solution successfully• Defined Process metrics to control performance• Created a Multi Generational Project Plan• Implemented Control/Response plan (loop)• Completed Risk Mitigation actions

• Reduced Cost– by helping to minimize potential downtime and the adverse effects of system,

network, and application failures and install, move, add, change and decommission implementations.

• Enhanced decision making ability– by facilitating access to information throughout the organization, and by enabling

the enterprise wide use of outputs from an integrated framework of processes and tools through such devices as cross functional IT service dashboards.

• Improve IT Service levels– by creating operational efficiencies and enabling a linked IT Service Management

process loop for defining, measuring, analyzing, improving, and controlling service performance.

End- Result

Conclusion

Questions ???

Thank you

Magesh ManiSohel ImrozUdaya Vangipurapu