Q 477. It is said that Business Modelling and Simulation can accelerate the DMAIC sequence of an improvement project. Explain how such an acceleration can materialize.   

 

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This is very true in context of the fast changing business environment & with the world now being shifted towards Agile ways of working, the leadership nowadays are not willing to wait for 4-6 months & let their processes bleed, rather they want quick outcomes. Business Modelling & Simulation can be the perfect aid in the following ways:-

 

• Business Modelling & Simulation is particularly useful when there is a lot of uncertainty around the process in focus & also when we don't have the luxury of large amount of data. Also we can easily come up with insights in a very less time which is analogous to the work which is done from Define, Measure & Analyze phase of a conventional DMAIC project. Here we require the cause-effect knowledge of the process basis which we can create our model. (For eg: Lead Time = Cycle Time + Wait Time + System Downtime)
• Business Modelling & Simulation comprises of three main elements i.e. Simulation, Sensitivity Analysis & Optimisation.
• Through Simulation  we can perform multiple trials & combinations on the parameters which have been selected as assumptions & accordingly come up with accurate forecasts of the output. This will ensure we have the optimal assumptions in order to have a robust output.
• Through Sensitivity analysis we can find out magnitude of the impact that a particular assumption or a variable has on the variability of the output & this will ensure tat we will be putting our improvement efforts in the right direction.
• Optimisation will help us to arrive at the correct decision basis the given assumptions, decision criteria & the constraints & come up with the optimal settings which needs to be done in order to arrive at the right decision.

Thus it is imperative that Business Modelling & Simulation largely aids the business excellence practitioners in simulating the process & come up with the optimum settings for the process which will ensure that all the improvement efforts are in the right direction in a considerably less time than a conventional DMAIC approach.

 Business modelling is used to design current and future state of an process. This model is used by the Business Analysts and stakeholders to ensure that they have an accurate understanding of the current “As-Is” model of the process. Business Modelling is used to verify if stakeholders have a shared understanding of the proposed “To-be" of the solution.

 

Business simulations are a hands-on, interactive learning experience that allow to understand the process thoroughly.. Instead of focusing on theoretical knowledge like in a typical classroom, participants build skills, improve conceptual knowledge, and gain a big picture view of the organization all at once.

 

Business modelling and Business simulation will help in accelerating the DMAIC process improvement projects. By using Business modelling, we can understand the as is state of the process clearly and we can work on what we want to achieve, that is To be process. Simulation will help in getting the practical knowledge. 

 

 

 

 

                 Modeling and simulation (M&S) is the use of a physical or logical representation of a given system to generate data and help determine decisions or make predictions about the system. A Business Simulation is a computer-based model of business processes and dynamics. The simulation model establishes a set of complex relationships between the business variables corresponding to significant entities in the business domain.

 

The Business modelling and simulation in turn supports the Improvement projects driven by DMAIC methodology in the Measure, Analyze & Improve Phase.

 

Measure Phase:

1. The business model helps to validate the data collected during the Measure Phase.
2. The mathematical model will help to narrow down only the significant variables, for which the data collection can be done.
3. The simulation may help to optimize the quantum of data collected.
4. Directly reduce the time and cost spent on the data collection.

 

Analyze Phase:

1. Apart from the Conventional analysis tools that we use for Problem solving, the optimization models give us an advantage to arrive at the root cause / significant variable quickly and objectively.
2. This eliminates the subjectivity of the analyze phase.
3. The simulation helps to validate, if the root cause / significant variable arrived from the model is valid.
4. This also helps to prioritize the variable to work on.

Improve Phase:

1. The model and the simulation becomes the Step Zero before the Pilot run.
2. This helps to avoid the adverse effects of implementing the wrong solution directly not the Pilot process.
3. The model and simulation helps to see the possible impact of implementing the solution on other variables.
4. This will definitely help to save a lot of time and money, especially helps to avoid the risk.

Thus the business modelling and simulation can help to accelerate the DMAIC process for any improvement.

Organisations who use DMAIC to improve processes often take months to reach the analyse phase. Business modelling practitioners know the importance of time in implementing the change initiatives in an organization. Simulation is one way to accelerate change. 

 

“ A simulation is the imitation of the operation of a real-world process or system over time. Simulations require the use of models; the model represents the key characteristics or behaviours of the selected system or process, whereas the simulation represents the evolution of the model over time. Often, computers are used to execute the simulation”. Source wikipedia

 

Business Modelling is a replication of real world processes using simulation models which use business assumptions, Decision making and Forecasting. 

 

Below are the reasons why Business Modelling and Simulation can accelerate the DMAIC sequence of an improvement project.

• Simulation eliminates the measure and analyse phase.
•  Simulation models can work on large datasets, can run 1000 of trails taking into account process variances, uncertainties and interdependencies and provide multiple solutions.
•  Running Simulation models doesn’t interfere with day to day work in an organization.
•  Impact on operations, processes and customers can be measured and visualised.

All the published answers are correct and to the point, however Ravindra has provided the best answer as to how modelling and simulation can expedite the DMAIC sequence.