Quality Quandaries: Improving a customer value stream at a financial service provider

In the wake of the financial crisis, the financial sector had to make tremendous efforts in being more transparent and cost efficient (Blom and Kuenen 2009). As a consequence, over the last decade, various financial service providers have embraced a range of methods for improving their customer processes. Amethod that has proven to be of great value for structurally improving customer value streams is Lean Six Sigma (LSS). This case study is about a customer value streamat a large Dutch financial service provider. A value stream is an end-to-end process within a company. For confidentiality reasons, the exact nature of the service is not disclosed. Examples are handling requests for loans or mortgages, processing insurance claims, or transferring a pension. This “Quality Quandary” discusses two projects that have been executed within the customer value stream. The first project was focused on a mid-office (MO), where the quality of information from the front office (FO) was improved (dependability). The second project was performed from the viewpoint of the front office itself, where processes were further improved, resulting in an altogether more efficient and effective customer value stream. Both projects were carried out using the LSS methodology, which is known for its define– measure–analyze–improve–control (DMAIC) phases (Schroeder et al. 2008). These phases induce a stepwise procedure for process improvement, based on measurements and evidence-based intervention. The stepwise approach and quantitative analyses originate from Six Sigma. On the other hand, Lean offers a collection of best practice and tools (see, e.g.,Womack et al. 1990), which are integrated in the activity plan of Six Sigma (cf. De Mast et al. 2012). The combination of Lean and Six Sigma has proven to be a sound method to organize process improvement. Since the start of LSS in industry in the 1990s other sectors have also adopted the methodology and have achieved substantial benefits; see De Mast et al. 2012. In LSS terminology, project leaders are called “belts.” Black belts run the larger projects, supported by green and orange belts. Green belts can also run projects independently, but these projects often have less impact on the organization as the monetary benefits are smaller. Orange belts usually run small improvement initiatives driven by the work floor that only take a few days,which is in contrast to black belt projects that typically take up several months (cf. De Mast et al. 2013; Akkerhuis et al. 2015). The projects discussed in this column were led by two black belts who are managers.