Why You Should Be Using The SIPOC At All Levels Of Your Company

Value Stream Mapping in a global economy

Success is not just about the end result; it's about understanding and optimising every step of the process. The SIPOC diagram reminds us that to achieve greatness, we must first grasp the intricacies of our business, from supplier to customer, and strive for continuous improvement at every stage.

Understanding where a process can be optimised starts with understanding what interaction related friction is causing your process to slow down and produce non value-add activity. In functionalised, task-oriented organisations leveraging the synergies of shared service centres of excellences, most operational teams are specialised in a limited group of business activities and rarely have 360° visibility into all the touchpoints required for the complete end-to-end service delivery to the client. As more and more organisations restructure to utilise such business operating models, the need to be more effective in adopting an internal Value Stream Mapping discipline has taken centre stage for those problem solvers tasked with business process optimisation.

Traditionally, a well-designed value stream mapping workshop or Kaizen problem solving forum is facilitated in a way to ensure that each participant comprehends the holistic view of the process being analysed and can easily contribute by quickly identifying where opportunities in waste reduction are present in the process flow. Workshops of such have historically been critical in offering business leaders a means to act as model corporate citizens in collaborating in cross-departmental process improvement initiatives while creating a portfolio of business opportunities based on the waste identification exercises which were conducted. The downside to such workshops is that if not managed well, they are often deemed as enormous waste creators in themselves when the organisation looks back and questions how much time, effort, and company funding was spent to bring so many high performing business leaders and operational subject matter experts to the table together and what value-add outputs did it return to the company.

With the advent of cloud technology being introduced to better connect multinational organisations using global business operating models, opportunities to enrich cross-departmental collaboration efforts are being created at unmatched scale. Software aimed at installing a value chain-oriented continuous improvement discipline is becoming the norm in organisations which seek maximum business transparency and promote a sense of ownership culture.

The traditional ‘Kaizen’ value stream mapping workshop which once required large meeting rooms, whiteboards, overhead projectors, a meeting facilitator, and an endless supply of coffee is starting to become revolutionised via continuous improvement automation which takes many of the brainstorming exercises conducted in a workshop environment to the desktop of the subject matter experts. In doing so, business leaders with decision making capabilities are equipped with rich, problem-solving information built on the insight of the experts who work on a day-to-day basis, ‘hands-on’ and in the field (Gemba).

SIPOC - Where it all starts

Regardless of how much or how little visibility a functionalised team may have into the many passages which take place within the business processes end-to-end trajectory, there is one simple LSS/Kaizen-friendly method that any team leader can adopt and teach to his team to better understand what can be done to help support the senior team in their quest to perform an effective Value Stream Mapping analysis: the SIPOC.

Perhaps one of the most underrated benefits of the SIPOC lies in its efficiency to communicate the key inflows and outflows required to bring value to your client while offering an easy means to map waste reduction opportunities to their root causes. Whether the process is taking an order for a pizza or processing transactions received from an overseas client, the logic of the SIPOC will allow even the most specialised user to effectively identify and map process wastes to their respective space in the business value chain.

An effective continuous improvement software will give the user the opportunity to easily identify and map wastes using the SIPOC logic and ultimately feed wastes identified from faulty interactions to a waste management reporting dashboard. Such technology offers management real-time visibility into the types of waste reduction opportunities existing in business operations and the cost-benefits assessment made by the subject matter experts who are in a position to implement the solution. Furthermore, such cross-departmental visibility into waste reduction opportunities identified, collected and communicated from the bottom-up, will ultimately offer additional insight into where investments in consultancy and knowledge gap reduction would be most effective while being implemented from the top-down.

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Accelerated waste reduction (What you get back)

• Excessive controls
• Manual activity
• Overproduction
• Substandard services
• Misinterpretation of roles & responsibilitie
• Upstream errors
• Downtime
• Defects
• Excessive motion
• Knowledge gaps
• Confusion
• Excessive risk

Through intelligent dashboard reporting, visibility into business opportunity is now traveling more rapidly and more frequently to the decision makers who are in charge of prioritising activities and maximising the usage of their work force. In doing so, operational risk and waste are identified, captured, consolidated, and evaluated with greater efficiency and creating a stronger sense of urgency discipline amongst the subject matter experts who are in charge of eliminating such waste and empowering team leaders to act more frequently on the ‘low hanging fruits’. This acceleration of waste elimination ultimately gives better visibility into what significant, more complex business decisions need to be made regarding continuous improvement investment.

Once your organisation is accustomed to manage each process step using the SIPOC logic, you will begin to notice that your Value Stream Mapping and Kaizen brainstorming sessions will become enriched with a robust set of information based on the availability of the wide array of knowledge, business know-how, and experiences lived in the field. Furthermore, your workshops will become streamlined with customised business agendas and crisp reports tailored to a specific audience and supported by fact-based information to accelerate tactical decision making.

All of this is a result of the 360° transparency into the wastes present in your Business Value Chain which began by the simple SIPOC exercise performed at the junior level. Considering all of the above, your organisation will now effectively promote an ongoing culture of waste reduction supported by the discipline of your continuous improvement software of choice.

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In Closing

In closing, the value stream mapping exercise is a fundamental top-down tool in offering ‘big picture’ visibility to your organisation’s decision makers. It must be completed accurately, effectively, and at the same frequency of the changes taking place in the structure of your business operating model which changes frequently and in accordance with your corporate growth and restructuring strategy.

The quickest and easiest way to get bottom-up visibility from your subject matter experts working in field regarding their waste-related pain points is with the SIPOC of which if automated correctly, will offer your organisation top-to-bottom, bottom-to-top, operational excellence and continuous improvement.