Review the various responsibilities of a project manager by organizing a project. The project will be a continuation of how to improve the process you chose in Competency 1. Our second Competency conc

Competency 1:

Process Evaluation

Lakeysa Green

Phoenix University

OPSCB/574: Creating Value Through Operations

Professor John Soltys

January 17, 2024

Competency 1: Process Evaluation

The Process and an Evaluation of the Process

Payroll processing waste can take many different forms, which affect resources and time. Every day, a variety of wasteful practices like manual data entry, ineffective approval workflows, and inaccurate time tracking take place in our organizations. To implement any change effectively, you first need a comprehensive grasp of your current procedures and practices which you can start by mapping your process (Aspland 2023). The Bering Straits Native Corporation has a payroll department that supports over 1950 workers. The department ensures that workers receive remuneration on a timely, reliable, and accurate basis.

Evaluation Of the Control Chart and Process Metrics

A control chart for the payroll process can track the accuracy and timeliness of payroll processing. Developing a control chart, we first need to identify the important process parameters that help the processing of payroll. This chart helps in identifying trends, such as an increase in errors or delays, allowing for corrective actions to be taken. The following sample data on the end-to-end processing time in days from a sample amount of 40 employees was collected:

The time to process payroll for each employee is measured.  The data are then plotted on the control chart.  The average is calculated.  The average is 7.85 – which means it takes on average each day 7.85 days to process payroll.  The control limits are then calculated.  The UCL is 25.8 days.  This is the maximum time it will take to process payroll when only common causes are present.  The LCL is 10.18 days.  This is the minimum time it will take to process when only common causes are present. Points 2-17 are below the mean, showing small shifts below the average. Point 21, is the first pattern that signifies an out-of-control point – a special cause of variation. Points 30-40 are also beyond the control limits. Based on the analysis, the process is variable and out of statistical control.

Process Evaluation Summary

The current program at Bering Straits Native Corporation requires multiple steps before an employee's payment request can be approved. It includes writing a letter to their supervisors while including the number of worked hours. The supervisor reviews the information and writes a letter to the payroll department. The department uses employee's data to calculate deductions and taxes before payment. Such a process is long, requires vast inventories, and is inaccurate. The payroll department uses Excel to calculate each employee's data, which is prone to errors. When evaluating the data, the company is looking for any patterns of error and inconsistencies. Following the evaluation of data, we recognized that payroll was delayed at different points on our control chart. It takes between 7.85 and 25.8 days before payment requests are fully processed. The ideal state would be to reduce the processing time variation and center the process closer to the 7-8 day goal.

Summary of Control Chart and Process Metrics Based on SPC Methods

 Point 21 indicates an out-of-control point in violation of SPC Rule 1, which deviates significantly from the average. This is due to payroll staff making an error in payroll calculations and tax deductions, which has caused a delay. Points 23–27 are four consecutive points that can be observed in Zone B of the control chart, in violation of SPC Rule 3. These data points indicate little deviations from the mean as payroll personnel has skipped a step in the process. Points 30-40 are trending up on the control chart and beyond the control limits showing a decrease in payroll accuracy over time. This fluctuation is a violation of rule 5, pointing to systematic errors and inconsistencies in the payroll process. Payroll staff at Bering Strait Native Corporation manually enter the data using Microsoft Excel, which is a laborious procedure that could be mistake-prone.

The Potential Benefits of the use of Six Sigma, Lean, or other Tools

Implementing a lean process can significantly improve payroll efficiency at Bering Straits Native Corporation. Lean manufacturing methodology prioritizes minimizing waste within manufacturing systems while maximizing productivity (Aspland 2023). Implementing lean processes will assist in identifying and eliminating waste, such as unnecessary paperwork, redundant approval processes, manual data entry, and delays, streamlining the entire payroll operation. Lean processes emphasize standardizing procedures, which can reduce errors and inconsistencies in payroll processing.

Description of the Statistical Process Control (SPC) Project

Creating a control chart for Bering Straits Native Corporation involved monitoring and visualizing the the variation in the payroll process over time. First, we identified the current issues with the payroll tracking process by understanding the current process through the creation of a flow chart. Next, we gathered data on the payroll tacking process to measure the length of time to process payroll. The data collected was analyzed to identify root causes of issues within the payroll tracking system by process mapping and creating a control chart. The information was reviewed, and the results were that payroll staff errors due to miscalculations and incorrect data entry were causing delays in processing. After noting the issues, it was suggested for lean process to be implemented to improve efficiency. Streamlining the payroll process is a necessary change to improve the payroll tracking process.

Recommendations for Improvement

Based on the evaluation of the imminent process, most workers must wait for over seven days to review their remuneration. The average duration an employee waits for it is around 7.85 days. In contrast, other requests take around thirty-seven days before processing. From the chart, it was noted that payroll deadlines were not being met while others exceeded by longer durations, implying that there are bottlenecks in our process. There is a high volume of requests from Bering Straits Native Corporation workers and management and a single payroll department, so lean principles should be implemented. Furthermore, to fulfill such requests on time and increase accuracy, the company should implement a connected time tracking and payroll system. This integrated system will reduce an overreliance on manual records, minimize errors and ensur3 that tracked time directly flows into the payroll system, leading to accurate pay calculations. Streamlining time tracking and payroll processes save time for employees, supervisors, and payroll staff, allowing for more efficient use of resources. The recommendations for improvement on the process will include training employees and supervisors about the new process. Since everyone was used to the old system, the new one will introduce simplicity. Continuous assessment of the new system should be performed regularly. This will reduce errors and ensure it performs optimally to meet worker's demands. (Cudney et al. 2020). During the assessment, improvements could be made to increase performance.

References

Aspland, S. (2023, September 5). Practical Steps for Implementing Lean Payroll Practices. Cintra. Retrieved January 11, 2024, from https://cintra.co.uk/blog/implementing-lean-payroll/

Cudney, E. A., Venuthurumilli, S. S. J., Materla, T., & Antony, J. (2020). A systematic review of Lean and Six Sigma approaches in higher education. Total Quality Management & Business Excellence, 31(3-4), 231-244.

Henrique, D. B., & Godinho Filho, M. (2020). A systematic literature review of empirical research in Lean and Six Sigma in healthcare. Total Quality Management & Business Excellence, 31(3-4), 429-449.