Real-time Risk Management
In the ever-evolving banking sector, adapting to new processes is critical. A recently transitioned banking process faced challenges of high defect rate, due to its novelty and the operators’ learning curve. As the process was not yet stable. The quality Black Belt leading this initiative was skeptical about the feasibility of conducting a project for such a nascent process. Project option was disqualified. However, instead of relying solely on a reactive approach, where errors were retrospectively analyzed at the end of each month, a proactive approach was adopted, integrating Process Mapping, Failure Modes and Effects Analysis (FMEA), and Root Cause Analysis (RCA) for real-time risk management.
Approach
Training and Familiarization
The Black Belt conducted training sessions on Process Maps, FMEA, and RCA to familiarize the team with these essential tools, ensuring they understood their applications.
Live Failure Mode Effect Analysis
A collaborative FMEA session identified potential failures within the process, assessing their severity. High-severity failures underwent a thorough RCA, using techniques like brainstorming and fishbone diagrams. The team critically evaluated the existing process controls and identified areas where improvements were needed. They brainstormed and defined enhanced controls to mitigate potential failures.
Risk Priority Numbers (RPN) were calculated based on ‘Severity,’ ‘Occurrence,’ and ‘Detection’ ratings. Occurrence ratings were linked to real-time data from Quality Assurance (QA), updating every couple of hours. Higher the occurrece, higher the rating. The higher the RPN, the greater the risk associated with a particular failure.
Risk Categorization
To allow the team to monitor and respond promptly to increasing occurrences. Three risk categories were introduced based on the RPN score range: ‘Green’ for no intervention, ‘Yellow’ for corrective actions, and ‘Red’ for immediate intervention.
Visual Management
A risk meter, resembling a speedometer, was displayed on the shop floor, offering real-time insights. Live RPN scores guided teams in taking prompt actions to prevent disruptions and enhance process performance.
Conclusion: Proactive risk management using FMEA and real-time tools improved efficiency and customer service in the newly transitioned banking process. The risk meter, integrated with live data, offered a visual management solution that empowered teams to address issues as they unfolded, preventing potential disruptions and enhancing overall process performance. Key takeaways include the importance of involving teams, enhancing process controls, and visualizing risks for timely interventions.
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