A Visual Performance Management Framework to Improve Decision Making using Lean Six Sigma

Organizations today understand the need to have an effective performance management system as a necessity to be successful in their business. They still however struggle to be best-in-class and deliver exceptional results due to unstructured measurement processes that are not in line with their key strategic objectives. Effective performance measures allow for an improved evaluation of the health of the business and provides an open and transparent communication between all key stakeholders. This thesis provides an overview of performance management systems (PMS’s), the existing frameworks in literature, common communication strategies and big data analytic practices. A continuous improvement approach, Lean Six Sigma (LSS) and its Define-Measure-Analyze-Improve-Control (DMAIC) methodology was examined to serve as an implementation plan towards deploying a PMS. To this end, a multi-criteria hierarchical framework called visual performance management (VPM) has been developed to provide an effective approach in deploying PMS’s using the DMAIC methodology and recommends proper communication strategies amongst all levels of the organization. The recommended VPM framework is then applied to a Program Management Office (PMO) of an aerospace company which is responsible for processing product change requests (PCR’s). Factors were identified in defining the right performance metrics for strategic, tactical and operational levels of the team. A time studies analysis was conducted to demonstrate how the VPM framework resulted in significant time and cost savings from a current annual cost of $600,000 to sustain their PMS to an annual cost of around $72,800. This study provides insight on the importance of creating an effective PMS and designs an original approach through a simple and quick way to adopt and sustain the proposed framework for any large organization