Chapter Nineteen: Continual Improvement

1
Chapter NineteenContinual Improvement
2
Rationale for Continual Improvement

• The rationale for continual improvement is that
  it is necessary in order to compete in the global
  marketplace.
• Just maintaining the status quo, even if the
  status quo is high quality, is like standing
  still in a race.
• Customer needs are not static. They change
  continually.
• A typical example is the personal computer.

3
Managements Role

• Managements role in continual improvement is
  leadership.
• Executive-level managers must be involved
  personally and extensively.
• The responsibility for continual improvement
  cannot be delegated.
• Moral support manifests itself as commitment
• Physical support comes in the form of the
  resources needed to accomplish the quality
  improvement objectives.
• Building continual quality improvement into the
  regular reward system including promotions and
  pay increases

4
Essential improvement activities

• Essential improvement activities include the
  following
• Maintaining communication
• Correcting obvious problems
• Looking upstream
• Documenting problems and progress
• Monitoring change

5
Essential improvement activities

• Maintain Communication Communication is
  essential to continual improvement. This cannot
  be overemphasized. Communication with
  improvement teams and between teams is a must.
• Correct Obvious Problems Often process problems
  are not obvious and a great deal of study is
  required to isolate them and find solutions.
• This is the typical case and it is why the
  scientific approach is so important in a total
  quality setting.
• However, there will be times when there is a
  problem with a process that is obvious. In such
  cases, the problem should be corrected
  immediately.
• Spending days studying a problem for which the
  solution is obvious just so that the scientific
  approach is used will result in ten-dollar
  solutions to ten-cent problems.
• Look Upstream Look for causes, not symptoms.
• This is a difficult point to make with people who
  are used to taking a cursory glance at a
  situation and putting out the fire as quickly as
  possible without taking time to determine what
  caused it.

6
Essential improvement activities

• Document Problems and Progress Take the time to
  write it down.
• It is not uncommon for an organization to
  continue solving the same problem over and over
  because nobody took the time to document the
  problems that have been dealt with and how they
  were solved.
• A fundamental rule for any improvement project
  team is document, document, document.
• Monitor Changes Regardless of how well studied
  a problem is, the solution eventually put in
  place may not solve it or may only partially
  solve it.
• For this reason, it is important to monitor the
  performance of a process after changes have been
  implemented.
• It is also important to ensure that pride of
  ownership on the part of those who recommended
  the changes do not interfere with objective
  monitoring of the changes.

7
Structure for Quality Improvement

• Structuring for quality improvement involves the
  following
• Establishing a quality council
• Developing a statement of responsibilities
• Establishing the necessary infrastructure

8
The Scientific Approach

• Using the scientific approach means
• Collecting meaningful data
• Identifying root causes of problems
• Developing appropriate solutions
• Planning and making changes.
• The scientific approach makes decisions based on
  data, looking for root causes of problems, and
  seeking permanent solutions instead of relying on
  quick fixes.

9
Identification of Improvement Needs

• Ways of identifying improvement needs include the
  following
• Multivoting
• Seeing customer input
• Studying the use of time
• Localizing problems.

10
Development of Improvement Plans

• Developing improvement plans involves the
  following steps
• Understanding the process
• Eliminating obvious errors
• Removing slack from processes
• Reducing variation in processes
• Planning for continual improvement.

11
Development of Improvement Plans

• Understand the Process
• Before attempting to improve a process, make sure
  every team member thoroughly understands it. How
  does it work? What is it supposed to do? What
  is the best practices known pertaining to the
  process? The team should ask these questions and
  pursue the answers together. This will give all
  team members a common understanding, eliminate
  ambiguity and inconsistencies, and point out any
  obvious problems that must be dealt with before
  proceeding to the next stage of planning.
• Eliminate Errors
• The team may identify obvious errors that can be
  quickly eliminated. Such errors should be
  eliminated before proceeding to the next state.
  This stage is sometimes referred to as
  "error-proofing" the process.
• Remove Slack
• This stage involves analyzing all of the steps in
  the process to determine whether they serve any
  purpose, and if so, what purpose they serve. In
  any organization, processes exist that have grown
  over the years with people continuing to operate
  them without giving any thought to why things are
  done a certain way or if they could be done
  better another way, or if they need to be done at
  all. There are few processes that cannot be
  streamlined.

12

• To effectively manage, measure and improve
  something, it must first be understood

13
Mapping Business Processes
An effective, simple way to improve understanding
of the business process is by developing a
graphic representation of all the activities and
relationships with thin the process

• Creates common understanding of the activities,
  results and who performs the steps
• Defines the boundaries of the process
• Can be a training tool
• Provides baseline to measure improvement

14
Relationship Map
15
Detailed Process Map

• Identifies the specific activities that make up
  the process. Basic steps are
• Identify the entity that will serve as your focal
  point
• Customer?
• Order?
• Item?
• Identify clear boundaries, starting and ending
  points
• Segment of the process?
• Keep it simple
• Does this detail add any insight?
• Do we need to map every exception condition?

16
Detailed Process Map

• Document the process as is, not how it should
  be or how it is remembered
• May be necessary to observe, monitor /or follow
  the process
• Need to map in manageable, logical segments
• Keep the focus relatively small
• Only areas which you have managerial control

17
Mapping Symbols
Typical, but others may be used as appropriate
18
Detailed Process Map Example
19
Facts of the Case I

• Process
• Dealer faxes order to DC. One out of 25 orders
  lost because of paper jams.
• Fax sits in In Box around 2 hours (up to 4)
  until internal mail picks it up.
• Internal mail takes about one hour (up to 1.5
  hours) to deliver to the picking area. One out
  of 100 faxes are delivered to the wrong place.
• Order sits in clerks in-box until it is
  processed (0 to 2 hours). Processing time takes
  5 minutes.

20
Facts of the Case II

• If item is in stock, worker picks and packs order
  (average 20 minutes, but up to 45 minutes).
• Inspector takes 2 minutes to check order. Still,
  one out of 200 orders are completed incorrectly.
• Transport firm delivers order (1 to 3 hours).

21
One Possible Solution
22
Is there room for improvement?

• Order spends 6.45 hrs in process
• 3 hrs is waiting
• 5 of orders are lost before picking
• 1 out of 200 will be shipped with wrong items or
  amounts

23
Development of Improvement Plans

• Reduce Variation Variation in a process results
  from either common causes or special causes.
• Common causes result in slight variations and are
  almost always present.
• Special causes typically result in greater
  variation in performance and are not always
  present.
• Plan for Continual Improvement By the time this
  step has been reached, the process in question
  should be in good shape.
• The key now is to incorporate the types of
  improvements made on a continual basis so that
  continual improvement becomes a normal part of
  doing business.
• The Plan-Do-Check-Act cycle applies here. With
  this cycle, each time a problem or potential
  improvement is identified, an improvement plan is
  developed (Plan), implemented (Do), monitored
  (Check), and refined as needed (Act).

24
Common Improvement Strategies

• Commonly used improvement strategies include the
  following
• Describing the process
• Standardizing the process
• Eliminating errors in the process
• Streamlining the process
• Reducing sources of variation
• Bringing the process under statistical control
• Improving the design of the process.

25
Common Improvement Strategies

• Describe the Process
• make sure that everyone involved in improving a
  process has a detailed knowledge of the process.
  Usually this requires some investigation and
  study.
• The steps involved are establish boundaries for
  the process flowchart the process make a
  diagram of how the work flows verify your work
  and correct immediately any obvious problems
  identified.
• Standardize the Process
• In order to continually improve a process, all
  people involved in its operation must be using
  the same procedures.
• The steps involved in standardizing a process
  are identify the current best known practices
  and write them down test the best practices to
  determine if they are, in fact, the best, and
  improve them if there is room for improvement
  make sure that the newly standardized process is
  being used by everyone keep records of process
  performance, update them continually, and use
  them to identify ways to improve the process even
  further on a continual basis.
• Streamline the Process
• The strategy of streamlining the process is used
  to take the slack out of a process.
• This can be done by reducing inventory, reducing
  cycle times, and eliminating unnecessary steps.
• After a process has been streamlined, every step
  in it has significance, contributes to the
  desired end, and adds value.

26
Common Improvement Strategies

• Reduce Sources of Variation The first step in
  the strategy of reducing sources of variation is
  identifying sources of variation.
• Such sources can often be traced to differences
  among people, machines, measurement instruments,
  material, and sources of material, operating
  conditions, and times of day.
• Regardless of the source of variation, after a
  source has been identified, this information
  should be used to reduce the amount of variation
  to the absolute minimum.
• Improve the Design of the Process There are many
  different ways to design and layout a process.
  Most designs can be improved on.
• The best way to improve the design of a process
  is through an active program of experimentation.
  In order to produce the best results, an
  experiment must be properly designed.

27
The Kaizen Approach

• Kaizen is the name given by the Japanese to the
  concept of continual incremental improvement. It
  is a broad concept that encompasses all of the
  many strategies for achieving continual
  improvement and entails the following five
  elements
• Straighten up
• Put things in order
• Clean up
• Personal cleanliness
• Discipline

28
Goldratts Theory of Constraints

• Goldratts theory of Constraints is another
  approach used to achieve continual improvement in
  the workplace. It involves the following steps
• Identify
• Exploit
• Subordinate
• Eliminate restraints
• Overcome inertia

29
Goldratts Theory of Constraints

• The following tools are used in applying
  Goldratts Theory of Constraints
• Effect-cause-effect
• Evaporating clouds
• Prerequisite trees
• The Socratic Method