DMAIC
Phases of
Process Improvement at Home Depot
1. Define
2. Measure
3. Analyze
4. Improve
5. Control
Define
Problem
Work Effort and Scope
• Customer Requirements
• Elimination of the problem
• Duration of the existing
Problem
• Know supplier input and
customer process output
• Objective to prevent
recurrence of the events
cycle
• Determine competences
and limitations
A New Vision
Competitive Landscape
The key to success of Home Depot is its
approach of treating its people well.
Associates are encouraged by the company to
express themselves and take the risk in
development and leadership for advancement
opportunities.
The corporate core values includes caring for
the people, being a responsible citizen, being
effective, and providing excellent customer
service, increase value of shareholders,
maintain respect, must have an entrepreneurial
spirit, and must build robust relationships its
stakeholders.
Creating a presence worldwide
Business plan and results
Metrics
Availability of
Information
Source
• Flow chart material
• Just in time (JIT)
• Compute six sigma process
• Key performance
indicators (KPI)
Customer Service Levels
• Feedback to company perceptions
• Sales, complaints, contracts, delivery information, and returned goods and services
Service and Manufacturing Business Strategy
Advantages
•JIT- inventory plan
•TQM- improvement
•PR- rethink
•Benchmarking- partners
Disadvantages
Supply Chain Strategy
Supply Chain Objectives
Capacity Constraint
Physical
•JIT- inconsistent
•TQM- no commitment
•PR- miss a step; revive
•Benchmarking- errors
Capacity Constraint
Policy
Strategy Impact
Operational Approach Used
Organization Quality
Customer Demands & Expectations
Flow Chart
Statistical Process Chart
Analyze
Brainstorm
• Measure or quantify the
system
• Factors for adjustment
Methods
for selection of
problem causes
• Gap step examination
• Process proficiency
Purchasing or Procurement Cycle
Electronic
Data
Interchange
Distribution
Transportation
Customs
Compliance
Ordering
Cycle
Manufacturing
Excellence
Store
Environment
Purchase
Orders
Process Proficiency
•
Assign
Logistics
Department to
be the circuit
board
•
Streamline
inventory
management
using order
management
•
Improve the
company’s
supply chain
functions
•Know customer
demands and trends
•Change focus
•Modify direction
•Supplier
relationship
•Increase visibility
Improve
Resolutions
Test
• Plans / Tactics
• Interpret charts
• Timelines / Schedule
• Design solutions
Know the
customer
•
Fine-tune
Strategy
•
Target local
demographic
s
•
Balance local
and national
purchasing
•
The corporate core values of Home Depot includes caring for the
people, being a responsible citizen, being effective, and providing
excellent customer service, increase value of shareholders,
maintain respect, must have an entrepreneurial spirit, and must
build robust relationships its stakeholders.
 Six Sigma
 Waste Elimination

Total Quality Management
Strategy
Innovative Solutions

 Cost Reduction
 Information Systems
 External and Internal
Sourcing
Control
Document
Update and Improve
• Record system results /
outcomes
• Monitor execution /
implementation
• Summarize major learnings
• Require training for new
procedures
Cause-and-effect Diagrams in
Supply Management
Human Factors
Insufficient
supervision
Poor training
New operator
Insufficient
tools
Inappropriate
speed
Meager
maintenance
Methods and
Design Factors
Faulty parts design
Incorrect
manufacturing
process
Numerous suppliers
Incorrect specification
Disparity in acquired
components
Knowing Customers and Work Performance
• External Customers
•Domestic Customers
• Novice Homeowners
• Experienced Homeowners
• Contractors
• International Customers
• Internal Customers
• Support Core Competencies
• MET
The key to success of Home Depot is its approach of treating its people well.
Associates are encouraged by the company to express themselves and take the risk
in development and leadership for advancement opportunities.
SUMMARY AND RESULTS
References:
REFERENCE
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Bendorf, R. (2004) Global Sourcing: What You Need to Know Retrieved from online wed address:
http://www.ism.ws/files/Pubs/Proceedings/CKBendorf.pdf
Christensen, T. (2010) How Does Outsourcing Affect the U.S. Economy Retrieved from online web address:
http://www.wisegeek.com/how-does-outsourcing-affect-the-us-economy.htm
Media Tech Target (2011) Define Measure Analyze Improve Control (DMAIC) Retrieved from online web address:
http://media.techtarget.com/searchSoftwareQuality/downloads/ect01TreasurechestSixSigma.pdf
Microsoft (2011) Home Depot CEO: Sorry we let you down Retrieved from online web address:
http://articles.moneycentral.msn.com/Investing/Extra/HomeDepotCEOWeLetYouDown.aspx
More Stream.com (2000-2011) Statistical Process Control Retrieved from online web address:
http://www.moresteam.com/toolbox/t402.cfm
Reh, J. (2010) Key Performance Indicators (KPI) retrieved from online web address
http://management.about.com/cs/generalmanagement/a/keyperfindic.htm
Rockford Consulting Group, Ltd. (1999) Supply Chain Management Retrieved from http://rockfordconsulting.com/supply-chainmanagement.htm
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The Home Depot Foundation (2010). What we do. Retrieved from http://www.homedepotfoundation.org/what-we-do.html
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Wisner, J. G., Leong, K. G., & Tan, K. (2005). Principles of Supply Chain Management. Nasib, OH: Thomson/Southwestern.