The Best of Six Sigma Practice in the Philippines: Bank of the Philippine Islands

The Bank of the Philippine Islands (BPI) is one of the premier and pioneering banks in the country. It is one of the companies featured in the recent The Best of Six Sigma Practices in the Philippines workshop.
Background:

• 157 years of banking leadership
• Ranked No. 3 in asset size
• Most profitable bank in the country
• Long history of stability and growth through mergers and acquisitions
• Over 800 branches, 1,500 ATMs
• Over 3 million customers
• Close to 12,000 employees

Reasons for launching Six Sigma:

• Improve processes and make it a way of life
• Streamline processes to improve profits, reduce costs, and provide customer satisfaction

Timeline:

• September 2005 – Started its selection of priority units/groups; executive briefing; selection of candidates for Black Belt and Green Belt training
• October 2005 – start of training

Six Sigma Team Structure:

First Year of Implementation:

BPI Process Owners – focused initially on one project from each core business or support group

• Corporate Banking
• Alternative Channels and Services Group
• Asset Management and Trust Group
• Card Banking Group
• Information Systems Group
• Insurance Group
• Audit

First Year of Implementation:

Phase 1 – Training

• 12 Black Belts – 15 days
• 32 Green Belts – 4 days
• 22 Sponsors – 2 days
• 29 Executives – 1 day

Phase 2 – Coaching

Results of the First Year of Implementation: 12 pilot projects resulted in around Php17M in saving and revenues.

As of year end 2007

• Total Black Belts trained – 32
• Total Black Belts certified – 25
• Total Green Belts trained – 186
• Total Green Belts certified – 88

As of end 2008

• Six Sigma program is being sustained through the Process Efficiency Committee
• Total of 10 active Black Belts
• Total of 25 ongoing projects

Click HERE to find out how BPI is taking care of its customers.

Filed under: Bank of the Philippine Islands, Finance, Six Sigma, Six Sigma Organizations

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How is Six Sigma in the Banking Industry?

There are already a number of banks that have ventured into Six Sigma, and have enjoyed the benefits and savings. However, I also know that there are still banks that are hesitant to go into it.

SixSigma Online has an interesting article on how Six Sigma can fit in the banking industry. Taking on the Six Sigma tool, DMAIC, the article says that it can improve the quality of banks’ services.

Read how it goes.

Related posts:
Banks Going Lean and Six Sigma 
Six Sigma Could be the Secret of Bank of America
COO of GE Money Philippines Adheres to Six Sigma
Six Sigma and Online Banking 
GE Money and Six Sigma
Shinhan Bank Goes Six Sigma Way
HSBC Bank Malaysia Vows to Intensify its Six Sigma
BoA Turns to Six Sigma

*Photo from Stock.Xchng

Filed under: Finance, Six Sigma, Six Sigma Organizations

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How Do Six Sigma Companies Fare in the Stock Market?

An article on BNET looks into the performance of Six Sigma companies in the stock market. It is saying that these companies have not really fared well.

QualPro found that 91 percent of these companies had stock performances below the S & P 500 index since announcing a Six Sigma program. Only five of the 58 companies exceeded the index. The remaining 53 companies underperformed the index. The bottom line? The majority of Six Sigma programs do not benefit a company’s stock performance.

…

General Electric, the poster child for Six Sigma, underperformed the S & P 500 by 30 percent over the past five years. Home Depot adopted Six Sigma in 2001. The result? Its stock has also lagged 30 percent behind the S & P 500.

Continue reading…

This is an interesting study, actually. I’m not sure though if there is actually a direct correlation between Six Sigma and stock performance of a company. While good stock performance indicates people’s confidence in a company, that many not really translate to Six Sigma ensuring continuous quality improvement.

And it’s curious that a company whose operations are continuously improving does not get the confidence of people to invest in their stocks.

What are your thoughts on this?

*Photo from Stock.Xchng

Filed under: Finance, Six Sigma, Six Sigma Organizations, Stock Market

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Six Sigma on Wall Street

The Wall Street is not in the best situation right now. Can Six Sigma help it back on its feet?

BLOGa.uni.cc asks can Wall Street benefit from Six Sigma?

Wall Street is not unique in their need to manage process-related inefficiencies and defects. Nor are they unique in needing to control process outputs in order to reduce costs, improve customer service, and streamline the organization. These are the tasks for which Six Sigma is designed. But, in order for the methodology to “work,” it must be deployed in the right way with the right resources with 100% commitment from senior management. If Wall Street were to truly give the methodology a chance, they might be surprised by the benefits they would enjoy.

Read the article.

Filed under: Finance, Six Sigma, The Wall Street

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Google Hires CFO with a Black Belt in Six Sigma Management

Even Google, perhaps one of the companies that we think is invincible, is feeling the crunch. Because of the economic crisis, Google is also now experiencing slowing of online ad growth. Yes, the company is tightening its belt.

And as it gears down, Google recently hired Patrick Pichette, a CFO with a black belt in Six Sigma management. According to the news, with the new CFO, Google is in for cost containment. Among its top priority concerns are display and mobile advertising and Google Apps.

This piece of news only validates what I’ve posted before that companies prepare for hard times with Six Sigma in mind.

What about you? How are you coping during this very challenging time?

Related story:
Good Times Gone at Google?

*Photo from World Street Journal article, Google Gears Down for Tougher Times

Filed under: Finance, Google, Six Sigma, Six Sigma Organizations

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Banks Going Lean and Six Sigma

Last week, we read about manufacturing companies going into Six Sigma to keep afloat during economic crisis.

Today, banks, which are probably the hardest hit, are encouraged to adopt Lean and Six Sigma principles to weather the economic storm. Quoted in an article on Bank Systems & Technology, Larry Mead, VP with Guidon Performance Solutions, said that Lean and Six Sigma principles are also applicable to financial institutions and are especially relevant today. He further says:

“Lean focuses on making things flow, like a mortgage loan request. t’s an end-to-end perspective that focuses on eliminating waste and engages the workforce.

The key for banks is to use Lean and Six as the means to reducing service times. They want to take out a lot of the hand-offs and simplify processes to reduce errors. There’s always a danger when a company says they are going to cut costs because they sometimes end up doing things that makes the service suffer. With Lean, you’re reducing cost by helping to smooth your processes.”

Read more…

It’s crunch time, and so banks need all the process improvement methodologies they can use. Lean and Six Sigma can be a great help.

Filed under: Finance, Lean, Six Sigma, Tips

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Manufacturers Cope By Going Into Lean, Six Sigma

Over at ThomasNet, a recent survey gives us an idea of how manufacturers cope during this economic downturn. As Philippine Senator Mar Roxas said, this is a major tsunami.

Well, on my way to work today, I heard on the radio that because of the economic turbulence in the U.S., about 400,000 workers in the Philippines might be affected. These workers work for the contact centers.

In the manufacturing side, I asked Wizheart about its implication. And he said that manufacturing companies, or any other company for that matter, live and breathe on credit. With financial institutions going bankrupt affecting local stocks, local banks would have stricter guidelines on credit or credit lines, or they might not grant loans to companies. Companies wouldn’t have the means to buy the raw materials. For manufacturing companies that are exporting to the U.S., such as semicon, they would find themselves without market.

Going back to that survey on ThomasNet, manufacturing companies are:

responding to the economic downturn by looking to streamline business, manufacturing and supply chain operations.

To handle the downward spiraling economy and to increase business efficiency, 63 percent of respondents have already adopted, or are examining, lean manufacturing, Six Sigma, Total Quality Management (TQM) and other methodologies for improving supply chain management.

Read more…

Filed under: Economy, Finance, Lean Manufacturing, Six Sigma, TQM

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Six Sigma Could be the Secret of Bank of America

The finance world trembled at the news of Lehman Brothers‘ announcement of bankruptcy. And we all know that when big financial insitutions like Lehman fails, the economy takes a deep lingering breath.

Merrill Lynch, nother financial institution would have gone the say way as Lehman, had it not gotten its much needed help.

Despite the economic crisis, Bank of America keeps afloat. In fact, it has just announced a $50 billion acquisition of Merrill Lynch. Viewed diffrently by different sectors, the acquisition is deemed to make Bank of American sturdier, and into becoming a financial global empire.

To be able make that acquisition, Bank of America shows everyone that the bank is sound. And this could be attributed to its Six Sigma initiatives. It has been about seven years that Bank of America embarked on its Six Sigma journey.

The stories below will tell us the Bank of America Six Sigma journey. Check them out!

Banking on Six Sigma
BoA Turns to Six Sigma
Bank of America: Investing in Six Sigma

*Photo credit

Filed under: Bank of America, Benefits and Savings, Finance, Six Sigma, Six Sigma Organizations

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Six Sigma Financial Case Study

Over at SAI Global, a Six Sigma Financial Case Study is presented.

The example was a company that needed to reduce financial risk due to lack of proof of ownership on leased vehicles while the dollar percentage of the total vehicle portfolio was slightly less than 2%, the dollar value of risk was in the tens of millions.

Using DMAIC, the Six Sigma team achieved the following:

1. During the Define Phase, the team outlined the scope of the project and set a goal of 25% reduction in the portfolio percentage. This would result in a risk savings of more than $10MM. In addition, through value add analysis of the current process map, a savings in excess of $100,000 in waste costs was identified that would be returned to the bottom line. A SIPOC was developed and Quick Wins were identified.
2. In the Measure Phase, from the three metrics defined as input, process and output, six key ones were identified, and data collection methods were put in place to collect baseline data. The data that was collected validated the potential savings and showed a stable process.

Continue reading…

Filed under: Finance, Six Sigma

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Involving Finance in Six Sigma – Do It Early and Fully

That’s the advice of Tony Jacowski. These are the reasons:

1. On Benefits – The teams agree upon the calculation of benefits upon implementation of the project, and when it’s time to transfer the project ownership to the process owner, the teams can review the expected benefits.
2. On Reliability – The finance team can give an honest assessment of the expected benefits and will report correctly any finance-related info.
3. On Standardization – Results of the computation of benefits are reliable and meaningful.
4. On Auditing – Project results and benefits can be subject to internal audits and other reviews of benefits.
5. On Budget – Any process improvements, such as KPIs, can be included in the budget.
6. On Accountability – The finance department can ensure that the Six Sigma project has accomplished more than the previous year(s).

Read more…

*Photo from Stock.Xchng

Filed under: Deployment, Finance, Six Sigma

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