The APQC Blog

Advance Your Process Improvements with Simulation Technology

I recently spoke with Luis Lopez, manager of process improvement at the Port of Vancouver, to discuss the role that simulation technology has in process improvement, advice on piloting simulation software, and a few lessons learned from his hands-on experience with simulation technology.

What role can simulation technology play in process improvement work?

Simulation technology plays an important role in the improvement of complex processes as it provides a non-invasive, risk-free, and cost-efficient method to identify and analyze the underlying factors that may contribute to poor process performance and evaluate potential improvements. Simulation technology is key when testing improvements in the real process can be very costly, risky or lengthy.

Simulation models also provide a great way to engage project teams in the design and development of process improvements. Advances in 3D graphics have made it relatively simple to make detailed 3D simulation models of an operational process. These 3D renderings allow project teams to quickly visualize their ideas and identify potential benefits and implementation barriers. This is why I like to say that “if one picture is worth a thousand words, an animated 3D simulation model in a process improvement project is worth a thousand pictures.” 

How did you come to the decision that simulation software was a good fit for your organization?

At the start of our process improvement initiative in late 2014, it became evident that we needed to carefully handle the risks associated with each process improvement project to ensure the sustainability of the program. This is not an easy task when you consider the nature and complexity of our operations and the significant impact to our customers and stakeholders if something goes wrong during one of our improvement projects. It took us just a few projects to realize that we needed a tool that could eliminate or mitigate the uncertainty in improving operational processes and avoid costly mistakes. I had some prior experience with simulation modeling and convinced my leadership team to allow me to run a pilot project to demonstrate how this technology could help us improve our processes. The project was successful in demonstrating how simulation provides a risk-free virtual sandbox to test any number of ideas and enables proper decision-making in improving processes. Four years later, simulation has become an integral part of not only our process improvement program but also of our operational decision-making.

Has the use of simulations impacted how you measure your process improvement efforts? If so, how have they changed?

For the most part, we continue using common financial and operational metrics to measure the value generated by our individual process improvement projects. However, we measure the accuracy of results from our simulation models versus real-life, post-implementation results as a measure of success for a process improvement project involving simulation. High accuracy results means that not only have we done a good job representing the real-life process and performed proper analysis of the improvements we wanted to implement but that we have also developed a simulation model that can enable continuous process improvement. Most of the simulations created by our team have proven remarkably accurate.

Who is typically responsible for deciding if a project should include a process simulation?

It varies from one organization to another. In some cases, the lead of the simulation program is entrusted with this decision, while in others an executive makes the decision prior to consultation with the simulation program’s lead. Deciding whether a project should include a process simulation or not requires both  a good understanding of simulation and the proposed project and the current state of the process. It is for this reason that the leader of the simulation program is always involved regardless of who makes this decision. As a subject matter expert, he or she is the most appropriate person to determine if a simulation model is truly needed and feasible in a process improvement project and if the potential project benefits will justify the invested time and effort.

What advice would you give to an organization that wants to pilot simulation software but doesn’t necessarily have the expertise?

Don’t try to boil the ocean, start small in the four elements required to start a simulation program in any organization: software, people, training, and pilot project.

  1. Software: Most simulation software companies offer free trial versions of their products with no time restrictions. While these versions would restrict the size and complexity of your simulation model, they are good enough to model a small process. This can help you to demonstrate the value proposition of simulation technology before you invest in any of these products.
  2. People: Using simulation technology requires people that can a) collect and validate the data and information necessary, b) conceptualize processes or systems, and c) design experiments. Assess if you have this skill set in your organization and decide whether to build simulation capabilities in-house, outsource simulation, or use a hybrid model wherein external resources provide training and support for in-house staff.
  3. Training: The amount of training necessary to use simulation software depends on the individual’s level of experience with simulation, operations research, and analytics. Individuals with good experience can supplement their skills with the free tutorials and training resources provided by most simulation software companies. Others may require a full week of training.
  4. Pilot project: Make sure you model a process or system that is relevant to the organization but in accordance to your simulation capabilities at the time (software and people).

For more information on this topic and insights on how to address these challenges, check out the full case study.