Welcome to Six Sigma Black Belt, Course 3, Module 2, Business Case and Project Charter. When a Six Sigma project is considered, a substantial amount of due diligence must take place to understand at all levels of the organization what the issue is, what the countermeasures will be, and the justification for expanding resources on the project. These elements culminate within the business case and the project charter. The charter is a short document that defines the team's mission, scope of operation, objectives, time frames, and consequences. Charters can be developed by top management or at the team level. To promote ownership and buy-in, it is suggested that a team development approach be considered. In the end, top management must endorse and support the agenda. After all, they too are a customer and stake holder. The charter begins with a purpose statement. This is a brief statement explaining why the team is being formed. The purpose statement should align with and support the organization's vision and mission statements. Objectives should always be stated in measurable terms. The charter should also define the operating scope. The remaining elements of the charter will be explored on the next slides. The business case is the justification for the project. The general rationale for a business case would normally involve quality, cost or delivery of a product with a financial justification. Some common justifications include the design or re-design of a new or existing product or process. It is very important to clearly outline the business case. Very often, business cases lack a defined or aligned impact measurement relating to the organization. Use the organization's financial experts to ground the monetary implications of the project in reality. Consider both the advantages and disadvantages, as well as key costs. It goes without saying, projects that do not have or are shown to not have the needed financial impact to the company should be stopped at once. Don't be afraid to pull the plug at anytime. The problem statement is contextually most like the purpose. It discusses the issue that the team wants to improve. Make sure your problem is as descriptive as possible. Make sure to include how long the problem has existed, what measurable item is affected, what the business impact, and what is the performance gap? Don't try to solve the problem within the words of the statement, be objective. An example might be, during Christmas 2019, FedEx has experienced a 37 percent drop in on-time package delivery, with a 40 percent drop in net profits. The problem statement should include a reference to a baseline measure for guidance. A baseline measure is the level of performance of the particular metric at the initial start of the project. The baseline measure helps to identify the areas in the company that are in the greatest need of improvement. Sometimes baseline measures will not agree with our assumptions. Be prepared to investigate and recalibrate if needed. Project scope is the boundaries of the project. Very often projects experience scope creep. Success of the project is proven to be directly tied to the establishment and control of the scope. Resist the temptation to modify the scope unless there is a good reason and consensus among the team members. The goal statement is conceived and agreed upon by the team and the team champion. Set goals that are smart, specific, measurable, achievable, relevant, and time-bound. Early in the life of Six Sigma, it was common for projects to extend over months and years. Leaders found that this was an intolerable circumstance for fear that true savings would not manifest itself after substantial investment of resources. Today, projects are typically 4-5 months or less and follow a blending of Six Sigma and Lean methodologies. Well-structured projects have a set of stages or milestones that are used to keep the project on track and to help bring a project to completion. Establish key milestones at all phases of the project. Make them specific, meaningful, and tied to the overarching aims of the project. This sets up a system such that when milestones are not met or partially met, the project team can implement corrective steps and allocate additional resources to right the ship. Leave no stone unturned when outlining your needed resources. These can include team members, equipment, workspace, time to use the equipment, office equipment, and even utilities.
