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Exercise 04: SIPOC/Project Charter

 Option 1:
 Assuming your current project, complete the following:
 SIPOC Diagram
 Problem Statement

 Option 2:
 Read the following ‘Employee Hiring Case Study’ and review the
related process data
 Working in a small team,
 First, create a SIPOC Diagram
 Note: Use same process steps provided in the table
 Then, create a Problem Statement (for a Project Charter)
 Given the available information, what do you think is the main issue
they should be solving and make sure it is in your problem statement

SIPOC Diagram/Project Charter Exercise
Employee Hiring Case Study
(see next slide for process steps)

New Position Issue a Hiring Approval

Requisition (By DM) Notice (HAN)
Process Description
 Department Manager (DM) issues a requisition form for
a new position into the HRIS
 HRM reviews the requisition with the DM using their
Legend: standard review guidelines and the job is then posted
DM = Departmental Manager within their HRIS system and shared externally
HRIS = Human Resource  Candidates may submit applications during an “open”
information system database period which is limited to one month, at which time
HRM = HR Manager candidate applications are checked and validated by
HRA = HR Assistant HRA per company standard applicant review guidelines.
HAN = Hiring Approval Notice  DM and HRM then review candidate applications and
ERP = Enterprise Resource Planning identify “Qualified Candidates”.
 Qualified candidates are then notified by email and
requested to schedule an interview over the following
two weeks.
 Once the interviews are completed, the best candidate
is selected and an offer is created by the HRM and the
HRA. The candidate must reply within 10 business days.
 Upon acceptance, a Hiring Approval Notice (HAN) is
created by the HRA using company ERP software.
Case Study Data
 Suppose you obtain the following information from the last six months:
 Time to create a hiring notice has increased, on average, by 10 days over prior 6 months
 Company goal is to fill a position within 30 days (Current Average is ~40 days)
 Acceptance rate is currently at 55%, which is below company target level of 75%
 Hiring process is over budget by 15% (believed due to additional effort needed for rework
in several process steps and extra time to fill positions due to lower acceptance rates)
 Additional Information by Process Step include: (Note: Use these steps in SIPOC)
Proces  Current 
Responsible  Rework %                  
ID Process Step (Task) Staff Involved Time  Lead Time 
(Lead) (Process Step)
(hours) (days)
10 Create Requisition DM DM 0.5 1 0%
20 Review and Post Requisition HRM HRM 4 3‐5 10%
30 Validate Candidates by Phone HRA HRA 4 5‐7 20%
~50% of Paper Submittals 
40 Review Candidate Applications DM DM & HRM 3 5 Require Follow Up w/ 
50 Interview Candidates DM DM & HRM 2 14 0%
60 Select Candidate DM DM & HRM 2 1 0%
70 Create Offer HRM HRM & HRA 1 1 20%
75 Wait for Candidate Candidate N/A (Candidate) N/A 7
80 Create HAN HRA HRA 0.5 1 5%
17 38‐42
hours days 3
SIPOC Diagram – Hiring Process
(Add S, I, O, and C)
Suppliers Inputs Process Outputs Customers

Step 1: Step 2: Step 3: Step 4: Step 5: Step 6: Step 7: Step 8: Final:

Create  Review &  Validate  Review  Interview  Select  Create  Wait for  Create 

Requisition Post  Candidates Candidate  Candidates Candidate Offer Candidate HAN
Requisition Applications

(Or, Use Vertical Process Map Format) 4

Reference: SIPOC Diagrams
Suppliers Inputs Process Outputs Customers

 Appraisers  Type of Loan  Complete &  Mortgage

 Insurance  Interest Rates Accurate Customers
Companies  # Processors  Process Time  External
 Title  Loan Officer < 30 days  Underwriters
Companies Experience  Loan Fees  Lending
 Lender Institutions
Guidelines  Regulatory

Process Underwrite Clear Close
Loan Loan Conditions Loan

 Suppliers  Customers
 Providers of inputs to a process
Process  Customers that receive physical
(e.g., people, companies, dept.) outputs, information, service
Steps/activities which
 Inputs/Requirements transform inputs  Outputs/Requirements
 Physical Inputs (raw materials,
 Products or Services Delivered
 May include requirements for customer information)
 May include KPI/metric and
process inputs to outputs
 Documents (e.g., Lead Time < 30 days)
 Policies/Guidelines (e.g., (may show horizontal or vertical)
standard work procedures) 5
Reference: Problem Statement
An effective problem statement provides a description of the “Pain” being
addressed and summarizes the improvement opportunity

Key Questions addressed are:

 What is the problem?

 When did the problem start?

 Extent of the problem (who is impacted)?

 Impact or consequence of the problem (in $$ if possible)