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Project Selection Guidelines

Selecting Projects
Nominations can come from various sources, including associates and customers.

To avoid sub-optimization, management has to evaluate and select the
projects.

While the evaluation criteria for project selection are many, the primary
basis is the COPQ at the company or division level.

Of equal importance is the calculation of Return on Investment (ROI).
There is a simple method for project selection.

Categorize and/or prioritize and then prepare a draft charter including a
suggested leader and team members.

Impact on the business and impact on team development are often used
in prioritizing projects.
Best Practice: Select and run projects in waves!
Who Identifies the Project?
A project may be identified by upper management, a departments management, a
group of associates, Black Belts, Green Belts, or a customer.

Upper management may select a project on the basis of the projects
impact on the entire organization. Projects of this significance may require
the participation of several departments. The word department refers to
any component within the organization.

A departments management may identify a project on the basis of its
impact on the departments ability to meet its organizational goals and
objectives.

A work group may identify a project to enhance its ability to meet customer
needs in its daily work.

Lean Experts and Black Belts often identify potential projects based on
their involvement on a previous project.
Aligning Projects to Plans
Turning the vision of an enterprise into action is a deployment process. Deploying the
vision of an enterprise requires specifics to clearly communicate, provide guidance in
terms of milestones, and to demonstrate management commitment.
The deployment process typically includes:
1.
2.
3.
4.
5.

Subdividing broad goals from the vision

Establishing responsibility for projects
Identifying actions needed to monitor performance
Identifying resources to support the plan
Regularly reviewing progress through scorecards

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Obtaining Data to Clarify the Problem

Collect specific, objective data on each problem, or process identified as a potential
project. The data should answer these questions:

What dissatisfaction and complaints are most likely to drive away existing
or new customers?

What level of performance does the competition deliver and how does it
compare with yours?

What are your most costly deficiencies?

Which deficiencies in your internal processes have the most adverse
effect on associates?

What are the COPQ related to the problem?
Evaluating and Selecting Projects
The purpose of a charter is to choose an appropriate project that Champions work on
with other leaders and Belts to create project charters.
A project charter is a one-page document that describes what the project team is to do.
To select effective projects the champion must follow the criteria below.
The BEST PROJECTS follow MUST and WANT criteria.
Must Criteria
Must criteria are yes/no considerations. For example, either the project meets the
threshold of the dollar opportunity ($100,000 of cost takeout may be set as a
minimum) or it doesnt. Only those projects that get a yes on all of the must criteria
are considered further. Evaluate each project to ensure it has the following must
criteria.
a. Measurable: Many times Executives or Champions do not have a lot of
data to determine how bad a problem really is. However, they know
enough about the problem to determine if it is measurable or not.
Measurability refers to whether the defect is identified and can be
measured. Some problems that are not measurable are not solvable!
b. Observable: The project should correct a continuing problem, not a recent
specific episode.
c. Of Manageable Size: Most projects should take no more than six months
to a year to complete. Projects that would probably take longer should be
divided into smaller projects likely to yield results more quickly.
d. Significant: When a project is completed, results should indicate the effort
was worthwhile. A good Lean Six Sigma Black Belt project should save, on
average, $250,000 after costs to solve the problem are taken into account.
A great project is one that gains the dollar savings and improves customer
satisfaction at the same time!
Want Criteria

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e. Greatest impact on focal points: This is a measure of impact on

Dashboard. Measures should indicate the projects potential impact to:
a. Retain and attract new customers and reduce the costs of poor
quality
b. Provide return on investment and enhance customer satisfaction
c. Enhance associate satisfaction
f. Urgency: Typically, urgent projects address performance problems in
core services, problems that make the organization highly vulnerable to
the competition, or issues that are crucial to key customers.
g. Risks: If there are known or suspected risks, the problem is likely to take
a long time to complete or have an uncertain outcome. However, if the
expected pay-off is high, the project may be worthwhile despite the risks.
h. Potential resistance to change: Among potential projects which are
equal in other criteria, the project likely to meet the least resistance is
usually the best choice.
First projects are designed to be a likely winner: If the organization is new to
improvement, it is important to look for a project certain to produce a successful
outcome. Potential impact and urgency are of secondary importance.
Charter Purpose
A charter is a document that establishes the purpose, scope, and plan for the project.
The charter is an agreement between the Champion and the team.
In this step, you will complete your charter for the project by documenting the:
1. Y, the measurement of the problem you are trying to solve
2. Goal for the project
3. Expected benefit for the project and its expected financial benefits
4. Process focus, or scope, of the project
5. Plan and schedule for completion of major milestones
6. Team members and their roles
The charter is a document that provides purpose and goals for the team. It tells your
team where you are going and how you are going to get there. It will be updated
throughout the 5 steps of DMAIC.
Note: If a charter was not created for your project by your Champion or Executive
Management, you must create one and have it approved by management. Do not move
forward with your project until the charter has been approved.
Problem Statements
A well-written problem statement should contain four major elements:
1. A description of the concern, problem, or opportunity; the problem
described should be a known, verifiable, or measurable fact, a defect, not
a guess or an assumption
2. Background on when and where the problem occurs or is observed
3. One or more measures indicating the magnitude or extent of the problem;
these measures should relate to the project Y(s)
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4. A description of the impact, consequences, or threat presented by the

problem
The following questions can help a team evaluate its problem statement:

Is the problem based on observation (fact) or assumption (guess)?

Does the problem statement presume a root cause?

Can data be collected by the team to verify and analyze the problem?

Is the problem statement too narrowly or broadly defined?

Is a solution included in the statement?

Would customers be happy if they knew you were working on this?

Does it deliver financial returns if it were solved?
Goal Statements
The goal statement defines the level of improvement the team is seeking to accomplish.
For an effective goal statement:

Start with a verb (e.g., reduce, eliminate, control, increase) to clearly
describe the change.

Answer the questions:
What do you want to achieve with your project?
What level of performance do you expect to achieve with your
project?
What is the time frame needed to achieve the goal?

Use the same variable and unit of measure as the problem statement. If
the variable and unit of measure are not the same, then the goal doesnt
match the problem.
Effective Problem and Goal Statements
Effective problem and goal statements do not:


Assign blame


Imply cause


Suggest a solution
If your statements attribute blame to a person or department, it will most likely generate
defensive behavior, hurting the teams ability to collect and analyze data objectively.
Blame also assumes or implies cause. Implying the cause may prevent the team from
uncovering the root cause(s).
The goal statement should not suggest a solution, e.g., we need a new database. This
solution may be wrong and sends a team down a dead-end road on their journey.
The problem statement must be a concise statement of the concern, issue, or
opportunity the team is addressing. In essence, it is the pain that needs to be removed.
Project Scope
During the project chartering process it is useful to determine project boundaries for the
problem a project team is to address. Chartering helps avoid what is known as project
scope creep which can be lethal, rapidly driving the length of the project.
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Determining project scope becomes a compass in determining the direction for a

project. In-scope items are those which will be included within the project. Depending on
the data and statistical information collected later by the project team, in-scope items
may or may not turn out to be root causes. However, in-scope items serve to keep both
the project Champion and team focused.
Out-of-scope items become a way of narrowing the project to a manageable size for
addressing a problem within a short time period. Out-of-scope items are not necessarily
less important than those placed in scope, but have been determined as outside the
project. These may be items for follow-on projects and future focus, areas that already
have a substantial number of projects currently underway, or areas where major
implementation is already occurring. Similar to the in-scope items, out-of-scope items
are agreed upon by the project team and Champion early in the project during the
chartering process.
Project Plans
Early on, your team should establish target dates for completing key tasks in the DMAIC
process.
Milestones provide a sense of urgency, a feeling of accomplishment during the project,
and help ensure the achievement of timely results. At a minimum, your team should set
dates for tollgate reviews, end-of-phase reviews with your owners to review what youve
found, your next steps, and any issues you anticipate.
Team Membership
Your team will be comprised of core team members who are process participants with a
strong interest in the process being improved. Core team members get involved in dayto-day work on the project, and typically commit a significant amount of time to it.
In addition to core team members, you will identify Subject Matter Experts who will be
called upon as resources from time-to-time because of their specialized knowledge
(e.g., compliance officer, financial analyst, human resources manager). Provide these
ad hoc team resources with a clear definition of their responsibilities and a realistic
expectation of their time commitment.
Team membership is defined by the Champion. Team members may change over the
life of the project, however, the core of the team will be in place for the entire project.
Select Method
Use DMAIC if you:

Are trying to reach a new level of performance for an existing process or service

Have measured (or at least measurable) specific deficiencies or opportunities for
performance improvements

Are trying to find and eliminate root cause(s) of a defect or problem
Use DMADV if you:

Are attempting to discover customer needs

Want to develop a new product

Want to develop a brand new process (technology, environment, regulation)
Use Lean VSM if you:
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Are trying to improve speed, cycle time, or throughput not related to a defect
Implement (Just Do Its):

Why hasnt this been solved already if the answer is knownresistance to
change?

Measure current performance and demonstrate gain
Killing Projects
There are many problems encountered everyday in the workplace. Not all of them are
worthy of upper management time and attention. If you cannot agree on a project it is
probably because it is not that important.
Kill a nomination when:
1. You cannot measure Ys
2. The financial benefits cannot be determined
3. You cannot prove the Xs
4. It is no longer important to the business
5. It is taking too long
Summary
1. Strategic project selection involves identification of projects that are aligned with
an organizations vision, strategic goals, and annual goals.
2. Steps include: Identify potential problems, obtain COPQ data, evaluate against
must criteria, select project, categorize, and charter.
3. The Project Charter is a key document and communication tool that describes
the customers, problem, goal, scope, business case, milestones, and team
composition.

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All Rights Reserved, Juran Institute, Inc.

http://www.juran.com

All Rights Reserved, Juran Institute, Inc.