Going back roughly 10 years, I can vividly remember my first, formal exposure to the Lean Six Sigma methodology. I was a bright-eyed, bushy tailed graduate sitting in a classroom (based in a fancy JHB hotel) awaiting my first day of Lean Six Sigma Yellow Belt training. There was so much to take in and so much on my mind. Raw exposure to financial services industry. Adjustment to the corporate way of life. And… this fancy thing called Lean Six Sigma (where apparently all the “intelligent” people worked).
The course began. Immediately I was enthralled. My teacher was phenomenal. I hung on every word she said. And the subject matter got my blood pumping… Defects per million opportunities (DPMO), process variation, project charters, DAMIC, lean manufacturing, quality…
However, with all this excitement and information overload, my key memory from that day was the concept of capturing the “Voice of the Customer.” This happens during the Define phase of the LSS methodology. The aim is to define what creates “value” for the client – what they are willing to pay for. It is the process of obtaining the customer’s requirements, expectations, preferences, comments, of a product or service in discussion. The “Voice of the Customer” stuck with me, as I knew that the success of every improvement project hinged on delivering this requirement. From this point everything in the project flows (such as identifying the Critical To Quality (CTQ) measures).
This may not seem a great revelation, as it makes logical sense and seems simplistic. But, this does not always transpire in practice. I will illustrate with an example. I was closely involved on numerous process improvement projects aimed at reducing the turnaround time on the loan application (approval) process. The premise was that if your institution were first to approve a client’s loan application, they would take up the loan with your institution. And, in turn, drive book growth, increased market share and ultimately an improved bottom line. This objective (VOC) was set by an internal customer focussed on operational efficiency and effectiveness. Unfortunately, the external client (end consumer) had not been consulted at this stage. As a result, the desired profitability and book growth were not achieved.
Thereafter, detailed interviews and focus groups were held with the client. The findings were outstanding. The client was not interested in the speed to approval. In fact, they would use the first approval to negotiate a better rate with the next institution they applied at. It turns out the client was very price sensitive. The key deciding factor for the client was the rate offered by the lending institution. Armed with this insight and feedback the focus shifted to ensuring a robust (risk-sensitive) application process that looked to offer the best possible rate to the client while ensuring the risk of the loan was effectively managed.
Both external and internal customers should be consulted when compiling the VOC. Especially the external customer, as they usually drive direct value to the organisation. It may be a costly and time-consuming endeavour. However, the opportunity cost of not doing it correctly may outweigh the upfront investment.
Claudio dalla Venezia
For more detailed information on the voice of the customer, click on this link (http://www.sixsigma-institute.org/Six_Sigma_DMAIC_Process_Define_Phase_Capturing_Voice_Of_Customer_VOC.php)
If you missed our first installment, please check it out (http://www.bizwizeconsulting.co.za/what-a-career-in-process-improvement-taught-me/)