Improving Municipal Government

Processes
How to Conduct a Customer
Focused Process Audit

© Quality Minds, Inc. June 2009

 What is a Process?
• An activity, using resources, managed in
order to transfer inputs into outputs.
– Often the output from one process forms the
input to the next process.
Inputs Outputs
Process
1. Material 1. A part
2. People 2. A critical dimension
3. Procedures 3. A critical characteristic
4. Customer 4. Communication
requirements
5. Data
5. Drawings
6. Information

Step Step Step Step

A process
1 2 3 4
may have Input Output
multiple steps
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 The Case for Process Audits
• Fire Fighting
– Most organizations consistently check the products or services
that are provided to customers. But this is a reactive check.
• The product or service is already completed. Costs, man hours,
etc. are tied up in the completed product or service. If the product
or service is nonconforming, you must start over.
• Be Proactive
– Good processes yield good products and services. Bad
processes yield bad products and services (garbage in equals
garbage out!). Instead of focusing on the output of the process
(products and/or services) spend time and resources checking
the health of processes.
– If you continuously check (audit) processes and use the results
to take improvement steps, you will continuously improve the
products and services created by the process.

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 How to Perform a Process Audit
Step One: Define the Process
• Before you audit anything, there must be a
standard in place to audit against. Simply
put, auditing is “say what you do (via a
standard) and do what you say”
• Three Methods for Creating a Standard (or
definition) of a Process
– Process Flow Diagram
– Deployment Diagram
– SIPOC Diagram

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 Creating a Process Flow Diagram
1. Determine the start and stop points to
your flow of process steps . The stop
point is typically near the customer.
2. Walk through the flow, writing down the
process steps as they exist now (Rule of
thumb: Pretend your are the product or
service). Make sure you use a noun and
verb to describe the process step.
3. Once you have roughly mapped out the
process, make it more formal by adding
symbols.

Activity
Decision Point Start/Stop
(Process Step)

4. Once finished, sign and date the flow

diagram with a revision level.

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 Creating a Deployment Flow Chart
(Swim Lane)
1. Here a "department" or "agency"
dimension is added horizontally
along the top of the chart. You may
use individuals, groups,
departments, functions, etc. -
whatever kinds of 'units' play major
roles in the process.
2. Draw vertical lines to separate the
functional boundaries.
3. When the flow moves from one
function to another, a horizontal line
ideally denotes this.
4. Apart from the ideally horizontal
moves between functions, aim when
possible to draw the sequence of
activities from top to bottom.
5. Use the task and decision-making
symbols as before and always
connect symbols with arrows
indicating the direction of flow.

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 SIPOC Diagram
• Suppliers: The entities that provide whatever is worked on in the
process (information, forms, material). The supplier may be an
outside vendor or another division or a coworker (as an internal
supplier).
• Input: The information or material provided by the supplier and used
by the process..
• Process: The steps used to convert inputs into outputs. (some
steps are value added and some are not value added)
• Output: The product, service or information being sent to the
customer. This is what the customer pays for. He/she wants output:
– With good quality
– Delivered on time
– At a competitive price
• Customers: The next step in the process, or the final (external)
customers.

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 Creating a SIPOC Diagram
1. Create an area that will allow the team
to post additions to the SIPOC S I P O C
diagram. This could be:
• A transparency (shown with an
overhead projector) made of the
SIPOC template
• Flip charts with headings (S-I-P-
O-C) written on each
• Headings written on post-it notes
posted to a wall.
2. Begin with the process. Map it in four
to five general steps.
3. Identify the outputs of this process.
4. Identify the customers that will receive
the outputs of this process.
5. Identify the inputs required for the
process to function properly.
6. Identify the suppliers of the inputs that
are required by the process.

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Levels of Measurement for SIPOC
Diagram
Inputs Outputs
Step One Step Two Step Three

Macro View-All Process Steps Micro View-Each Process Step

Step Two

S I P O C S I P O C
Step
Step
One
One
Step
Step
Two
Two
Step
Step
Three
Three
Etc.

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 How to Perform a Process Audit
Step Two: Perform the Audit
• Once you define the process, you can
begin auditing the process
• Perform the Audit in Three Phases:
– Understand the Customer
• Requirements
• Voice of the customer
– Understand the Process
• How was the process created?
– Performance of Process
• Assess inputs and outputs
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 Phase One
Get copy of SIPOC Get copy of process What is the voice of the If applicable, get copy
Pick a process customer?-Quality, of customer’s
diagram for process flow diagram or
to audit Delivery, Satisfaction, specifications and/or
deployment diagram
Etc. requirements

Phase Two

Yes Write down the

Is there a Review customer’s
Review it and customer’s critical
internal requirements with
document results requirements
specification? creators of process
Does it match Go through the requirements
the customer’s No and make sure the
organization agrees with the
specification? requirements. If there are
Get SIPOC diagram
exceptions, make sure they
for process steps to are being addressed.
Do they match? be evaluated in walk
Are they linked? through

Find out how he/she manages the Start third phase of Third
department. What performance audit by interviewing
supervisor Phase
metrics are tracked?

Travel as the product or service

Using the process flow How to Conduct a Process
diagram and SIPOC
does. Evaluate key outputs and
diagrams, walk through
Audit
inputs at each step. How well are
the process
the outputs meeting customer
requirements? If requirements are
not met, what is done? What is Be sure and present
the quality of each input? Are they Summarize Results results to leadership
delivered on time? If an input is (85/15 rule)
bad, what is being done with the
supplier?
Issue audit report 11
 How to Perform a Process Audit
Step Three: Check Results of Audit
• It is critical that the results of audits be
reviewed by organizational leadership
• Leadership Support makes the Difference:
• Deming’s 85/15 Rule: 85% of problems in any organization
are within the system and are the responsibility of
leadership while only 15% lie with the worker
• Systems are made of processes. Processes are used by workers to
produce products and/or services. If the system is bad, the
processes are bad and consequently service and/or product will be
bad.

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 Leadership Review Sessions
• To continuously improve an organization,
Leadership must consistently meet to review
performance and highlight opportunities for
improvement
– Some performance metrics will be reactive in nature
(ex. customer satisfaction)
– As much as possible, proactive measures of
performance must be on the meeting agenda.
Process audits are strong, proactive tools and the
results of audits must be used as a performance
measure.
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 How to Perform a Process Audit
Step Four: Act on Results
• Once results are reviewed, actions must
be taken to improve processes
• The determination of actions is also the
responsibility of leadership
• Audit results will present two types of
opportunities:
– A complete system breakdown
– A process breakdown

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 Department A Department B Department C

You conduct process audits in three different departments

In process step three of department A, you find a work instruction that is not being followed
In process step one of department B, you find a work instruction that is not being followed
In process step four of department C, you find a work instruction that is not being followed
You have solid evidence that work instructions are not being followed in the organization. You don’t
necessarily have bad output as a result of it but you could. Because you see the same issue in three
different departments, the system is broken. Take action now to fix this issue: Better training, Better work
instructions 15
 Department A Department B Department C

You conduct process audits in three different departments

In process step four of department C, you find a work instruction that is not being followed. No other
instances were found of instructions not being followed. This is not a system issue but rather a
process issue.

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 Continuously Improve
Plan Audits-Make sure there is a
e schedule and resources to conduct
th audits
p
sto
ver !
Ne cle
cy

Make sure there is a Conduct audits (on time)

process in place for per the schedule
Leadership to determine
improvement actions

Make sure a process is in place

for Leadership review of results

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