1. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 1 Chapter 7 Process Management

2. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 2 Wisdom from Texas Instruments “Unless you change the process, why would you expect the results to change”

3. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 3 Processes A process is a sequence of activities that is intended to achieve some result Types of processes: –Core processes Design processes Production/delivery processes –Support processes –Supplier and partnership processes

4. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 4 Process Management Process Management: planning and administering the activities (design, control, and improve) necessary to achieve a high level of performance Requirements to apply process management techniques –Repeatable –Measurable

5. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 5 AT&T Process Management Principles Focus on end-to-end process Mindset of prevention and continuous improvement Everyone manages a process at some level and is a customer and a supplier Customer needs drive the process Corrective action focuses on root cause Process simplification reduces errors

6. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 6 Control vs. Improvement Controlled process Improvement Time New zone of control Out-of-control

7. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 7 Leading Practices (1 of 3) Translate customer requirements and internal capabilities into product and service design requirements early in the process Ensure that quality is built into products and services and use appropriate tools during development Manage product development process to enhance communication, reduce time, and ensure quality

8. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 8 Leading Practices (2 of 3) Define, document, and manage important production/delivery and support processes Define performance requirements for suppliers and ensure that they are met Control the quality and operational performance of key processes and use systematic methods to identify variations, determine root causes, and make corrections

9. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 9 Leading Practices (3 of 3) Continuously improve processes to achieve better quality, cycle time, and overall operational performance Innovate to achieve breakthrough performance using benchmarking and reengineering

10. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 10 Product Development Paradigms Traditional Approach Design the product Make the product Sell the product Deming’s Approach Design the product Make it with appropriate tests Put it on the market Conduct consumer research Redesign with improvements

11. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 11 Product Development Process Idea generation Idea generation Concept development Concept development Product & process design Full-scale production Full-scale production Product introduction Product introduction Market evaluation Market evaluation

12. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 12 Quality Engineering System Design –Functional performance Parameter Design –Nominal dimensions Tolerance Design –Tolerances

13. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 13 Loss Functions loss no loss nominal tolerance loss Traditional View Taguchi’s View

14. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 14 Taguchi Loss Function Calculations L(x) = k(x - T) 2 Example: Specification =.500 .020 Failure outside of the tolerance range costs $50 to repair. Thus, 50 = k(.020) 2. Solving for k yields k = 125,000. The loss function is: L(x) = 125,000(x -.500) 2 Expected loss = k(  2 + D 2 ) where D is the deviation from the target.

15. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 15 Design Factors Functional performance Cost Quality Manufacturability Safety –Liability Environmental impact –Recylability –Disassembly

16. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 16 Streamlining Product Development Competitive need for rapid product development Concurrent (Simultaneous) engineering - a process in which all major functions involved with bringing a product to market are continuously involved with the product development from conception through sales Design reviews

17. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 17 Quality Function Deployment A customer-driven planning process to guide the design, manufacturing, and marketing of goods A means of translating (converting) the voice of the customer into technical language Improves communication and teamwork between all constituencies involved in the design and production processes

18. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 18 House of Quality Technical requirements Voice of the customer Relationship matrix Technical requirement priorities Customer requirement priorities Competitive evaluation Interrelationships

19. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 19 Quality Function Deployment technical requirements component characteristics process operations quality plan customer requirements technical requirements component characteristics process operations

20. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 20 Motorola’s Approach to Process Design 1.Identify the product or service 2.Identify the customer 3.Identify the supplier 4.Identify the process 5.Mistake-proof the process 6.Develop measurements and control, and improvement goals.

21. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 21 Evaluating a Process (1 of 2) Are steps arranged in logical sequence? Do all steps add value? Can some be eliminated or added? Can some be combined? Should some be reordered? Are capacities in balance? What skills, equipment, and tools are required at each step?

22. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 22 Evaluating a Process (2 of 2) At which points might errors occur and how can they be corrected? At which points should quality be measured? What procedures should employees follow where customer interaction occurs?

23. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 23 Projects Project – temporary work structures Project initiation – direction, priorities, limitations, and constraints Project plan – blueprint and resources needed Execution – produce deliverables Close out – evaluate customer satisfaction and provide learning for future projects

24. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 24 Basic Components of Services Physical facilities, processes, and procedures Employee behavior Employee professional judgment

25. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 25 Key Service Dimensions Customer contact and interaction Labor intensity Customization

26. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 26 Control The continuing process of evaluating process performance and taking corrective action when necessary Components of control systems –Standard or goal –Means of measuring accomplishment –Comparison of results with the standard as a basis for corrective action A well-controlled system is predictable

27. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 27 After Action Review 1.What was supposed to happen? 2.What actually happened? 3.Why was there a difference? 4.What can we learn?

28. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 28 Supplier and Partnering Processes Recognize the strategic importance of suppliers Develop win-win relationships through partnerships Establish trust through openness and honesty

29. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 29 Supplier Certification Systems A program to certify suppliers who provide quality materials in a cost- effective and timely manner Certification standards and process can vary from company to company Certification can be time-consuming and expensive A uniform set of standards, such as ISO 9000 or QS 9000, can be used

30. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 30 Benefits of Effective Supplier Process Management Reduced costs Faster time to market Increased access to technology Reduced supplier risk Improved quality

31. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 31 Process Improvement Productivity improvement Work simplification Planned methods change Kaizen Stretch goals Benchmarking Reengineering Traditional Industrial Engineering New approaches from the total quality movement

32. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 32 Kaizen Gradual and orderly continuous improvement Minimal financial investment Involvement of all employees Exploit the knowledge and experience of workers

33. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 33 Agility Flexibility – the ability to adapt quickly and effectively to changing requirements Cycle time – the time it takes to accomplish one cycle of a process Benefits –Improve customer response –Force process streamlining and simplification

34. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 34 Breakthrough Improvement Discontinuous change resulting from innovative and creative thinking Benchmarking – the search of industry best practices that lead to superior performance –Competitive benchmarking –Process benchmarking –Strategic benchmarking Reengineering – radical redesign of processes

35. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 35 Process Management in the Baldrige Award Criteria (1 of 2) The Process Management Category examines the key aspects of an organization’s process management, including customer-focused design, product and service delivery, key business, and support processes. This Category encompasses all key processes and all work units.

36. THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson Learning TM 36 6.1 Product and Service Processes a. Design Processes b. Production/Delivery Processes 6.2 Business Processes 6.3 Support Processes Process Management in the Baldrige Award Criteria (2 of 2)