Letter of Credit – Meaning and Different Types of LC
International trade between an Exporter and Importer would entail multiple transactions in terms of documentation exchange, physical cargo movement as well as settlement of payment which have to be clearly defined and setup in order to ensure smooth business transaction. Over the years international trade has established various methods and payment mechanisms that are accepted […]
Role of a Finance Certifier in Six Sigma Project
The Finance Certifier is the only member of the Six Sigma Project team apart from the Project Lead that is selected by the Project Champion. This is because, it is the Project Champions responsibility to ensure that the financials of the Project are absolutely unbiased. Of late, finance certifiers have come under a lot of […]
Google: Conflicts of Interest
Google is the most dominant search engine in the United States as well as in the world. It controls more than two-thirds of the readership in the United States. This means that if it were an actual newspaper, Google would have been open to antitrust violation lawsuits. Google has a greater stranglehold on the readership […]
What is Learning Curve ? – Meaning and Concept
Introduction In any environment if a person is assigned to do the same task, then after a period of time, there is an improvement in his performance. If data points are collected over a period of time, the curve constructed on the graph will show a decrease in effort per unit for repetitive operations. This […]
Different Types of Online Business Models
Almost all startups being funded nowadays have an online business model. This is the reason why they appear to be similar to each other. However, this observation is a flaw in the thinking of the untrained observer. Not all online business models are similar to one another. There are many varied forms of models that […]
The SIPOC methodology is one of the most useful concepts in the hand of a BPM expert. The idea behind the SIPOC methodology is to view each process as a different organization in itself. Each process therefore has its own suppliers, inputs and corresponding customers and outputs. The aggregation of all these processes is the system. This helps define each process with clarity. It also helps find what exactly is going wrong where.
For instance, if there is a system outage, then the process is not to blame. Corrective action must be taken to ensure that the infrastructure suppliers perform better. Here are some of the salient features of the SIPOC methodology.
High Level Process Map: A SIPOC methodology is in-effect a high level process map. It does not have details regarding who is supposed to be doing what. Rather it defines the working relationships between the various stakeholders. Some steps are required to effectively implement the SIPOC methodology. They are as follows:
Acquaint Suppliers: A large number of issues arise in the process because the suppliers are not well versed with the requirements. The suppliers could be internal or external to the organization but that is not the point of contention. The idea is orient the suppliers and make them aware of the rules, policies and procedures set for them. The Service Level Agreements must be explicitly stated to ensure that the suppliers know exactly what is expected of them.
Scheduling Inputs: Based on the negotiations and inputs from suppliers, one must carefully schedule inputs. Inputs can be in the form of men, money, material, machinery or information. The inputs must be provided to the process in the most optimum manner. There are many operations research techniques which can b e used in this regard to lower the cost levels and increase the service levels.
Process:
The SIPOC provided an effective methodology to get an in detail look at the process. Some things that are usually defined as the part of SIPOC are as follows:
Outputs: Outputs must be expresses in terms of deliverables which can be verified. Therefore having outputs such as customer satisfaction is not correct. This can be the purpose of the process, however the output will be something like the best possible service (define using SLA) provided in the least possible time (Specify time in minutes). It is important to keep the outputs quantifiable because what cannot be measured cannot be managed.
Customer: The customer’s job is to consume the outputs of the process as well as provide feedback. The feedback could be related to the current performance of the process. It could also be regarding the future changes expected in the outputs of the process. For instance, the sales department is the customer of operations. They should communicate to operations if they see a period of slow sales so that production can be adjusted accordingly.
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Continuous Improvement and Business Process Re-Engineering
February 12, 2025
