CH#7-Process Improvement.pdf

CH#7: Process Improvement Learning Objective ✓Use quality tools for process analysis and problem solving. ✓Describe and contrast corporate quality improvement programs. ✓Lead a team in a process improvement initiative. ✓Measure the capability of a process. Introduction The focus of this ch...

CH#7: Process Improvement Learning Objective ✓Use quality tools for process analysis and problem solving. ✓Describe and contrast corporate quality improvement programs. ✓Lead a team in a process improvement initiative. ✓Measure the capability of a process. Introduction The focus of this chapter is on continuous improvement in service organizations using productivity and quality initiatives. World-class service firms are noted by their commitment to ongoing improvement in customer service, thus raising the bar of excellence for the industry. Continuous improvement is a way of thinking that needs to be incorporated into a firm’s culture. The philosophy of continuous improvement is captured in the plan-do-check- act (PDCA) cycle proposed by W. Edwards Deming. Quality and Productivity Improvement Process Plan-Do-Check-Act (PDCA) Cycle Deming’s approach to Continuous Improvement, represented by a wheel called a (PDCA cycle) consists of four steps: Plan: select and analyze the problem; Do: implement the solution; Check: the results of the change; and Act: to standardize the solution and reflect on the learning.  Quality and Productivity Improvement Process Problem-Solving Steps in the PDCA Cycle Recognizing the Problem and Establishing Priorities Step 1 During the recognition stage, the problem is outlined by management in very general terms based on information from many sources. Forming Quality Improvement Teams Step 2 An interdisciplinary team of individuals close to the problem is created and given a mandate to address the problem. Defining the Problem Step 3 The team first must define the problem and its scope clearly. Pareto analysis often can point to significant areas to investigate. Developing Performance Measures Step 4 The effect of changes on the process can be verified only by taking measures of performance. Analyzing the Problem/Process Flowcharting the process is often the first step at this stage to get a full understanding of all the Step 5 intricacies (complexity) involved. Information gathered at this stage will help determine potential solutions.  Quality and Productivity Improvement Process Problem-Solving Steps in the PDCA Cycle Determining Possible Causes The cause-and-effect diagram is particularly helpful in identifying possible causes of the problem. The team can use Step 6 the diagram to brainstorm ideas for the root cause. After the possible causes are identified, data are organized using check sheets, scatter diagrams, histograms, and run charts to discover the root cause. Selecting and Implementing the Solution Step 7 The criteria for selecting a solution include focus on the root cause, prevention of problem recurrence, cost- effectiveness, and timeliness. Evaluating the Solution: The Follow-Up Step 8 Once the solution has been implemented, the process is checked to verify that the problem has been solved. Run charts are useful for comparing prior data with current performance. Ensuring Permanence Step 9 New methods need to be established and workers must be trained. Control charts can be used to monitor the process to ensure that the process remains stable. Continuous Improvement Step Quality and productivity are ramped up only with repetitions of the PDCA cycle. Once a problem is solved, another 10 opportunity is identified for a new round of improvement analysis. Quality Tools for Analysis and Problem Solving 1. Check Sheet 2. Run Chart 3. Histogram 4. Pareto Chart 5. Flowchart 6. Cause-and-Effect Diagram 7. Scatter Diagram 8. Control Chart 9. Benchmarking  Quality Tools for Analysis and Problem Solving 1 - Check Sheet 2 - Run Chart Problem Area Lost Departure Month Mechanical Overbooked Other Luggage Delay January 1 2 3 3 1 February 3 3 0 1 0 March 2 5 3 2 3 April 5 4 4 0 2 May 4 7 2 3 0 June 3 8 1 1 1 July 6 6 3 0 2 August 7 9 0 3 0 September 4 7 3 0 2 October 3 11 2 3 0 November 2 10 1 0 0 December 4 12 2 0 1 Total 44 84 24 16 12 Quality Tools for Analysis and Problem Solving 3 - Histogram 4 – Pareto Chart Quality Tools for Analysis and Problem Solving 5 – Flow Chart 6 – Cause-and-Effect Diagram Quality Tools for Analysis and Problem Solving 7 - Scatter Diagram 8 – Control Chart  Benchmarking Benchmarking: is measuring the quality of the firm’s performance by comparison with the performance of other companies known for being “best in class”. Learn from the “best in class”. It includes visiting the leading firm to learn how management has achieved such outstanding performance. Benchmarking process involves five steps: (1) Select a critical process that needs improvement; (2) Identify an organization that excels in the process; (3) Contact the benchmark firm, make a visit, and study the process; (4) Analyze the findings; and (5) Improve your process accordingly.  Improvement Programs Service quality begins with people. All the measurements to detect non-conformance do not produce a quality service; quality begins with the development of positive attitudes among all people in the organization. Improvement programs emphasize preventing poor quality, taking personal responsibility for quality, and building an attitude that quality can be made certain. Deming’s 14-Point Program.  Improvement Programs Deming’s 14-Point Program. 1. Create constancy of purpose for improvements of product and service. 2. Adopt the new philosophy. Do not accept poor levels of work, delays, and lax (loose) service. 3. Cease dependence on mass inspection. Inspection comes too late and is costly. Instead, focus on improving the process itself. 4. End the practice of awarding business on price tag alone. The purchasing department should buy on the basis of statistical evidence of quality, not only on the basis of price. Reduce the number of vendors, and reward high-quality suppliers with long-term contracts. 5. Constantly and forever improve the system of production and service. Search continually for problems in the system, and seek ways of improvement.  Improvement Programs 6. Institute modern methods of training on the job. Restructure training to define acceptable levels of work. Use statistical methods to evaluate training. 7. Institute modern methods of supervising. Focus supervision on helping workers to do a better job. Provide the tools and techniques to promote pride in one’s work. 8. Drive out fear. Eliminate fear by encouraging the communication of problems and expression of ideas. 9. Break-down barriers between departments. Encourage problem solving through teamwork and use of quality-control circles. 10. Eliminate numerical goals for the workforce. Goals, slogans, and posters cajoling (persuading) workers to increase productivity should be eliminated. Such exhortations (urging) cause worker resentment (dissatisfaction), because most of the necessary changes are outside their control. Improvement Programs 11. Eliminate work standards and numerical quotas. Production quotas focus on quantity, and they guarantee poor quality in their attainment. Quality goals such as an acceptable percentage of defective items do not motivate workers toward improvement. Use statistical methods for continuing improvement of quality and productivity. 12. Remove barriers that hinder (prevent) hourly workers. Workers need feedback on the quality of their work. All barriers to pride in one’s work must be removed. 13. Institute a vigorous (robust) program of education and training. Because of changes in technology and turnover of personnel, all employees need continual training and retraining. 14. Create a structure in top management that will push every day on the above 13 points.