Transcript The Scope and Language of Operations Management

Chapter 9
Building and
Sustaining
Total Quality
Organizations
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Key Idea
Building and sustaining a TQ organization
requires a readiness for change, the
adoption of sound practices and
implementation strategies, and an
effective organizational infrastructure.
Why Adopt TQ Philosophy?
Reaction to competitive threat to
profitable survival
 An opportunity to improve
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Selling the TQ Concept
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Learn to think like top
executives
Position quality as a way
to address priorities of
stakeholders
Align objectives with
those of senior
management
Make arguments
quantitative
Make the first pitch to
someone likely to be
sympathetic
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Focus on getting an early
win, even if it is small
Ensure that efforts won’t
be undercut by corporate
accounting principles
Develop allies, both
internal and external
Develop metrics for return
on quality
Never stop selling quality
Corporate Culture and
Change
 Corporate
culture is a company’s
value system and its collection of
guiding principles
 Cultural values often seen in
mission and vision statements
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Key Idea
Culture is reflected by the management policies
and actions that a company practices. Therefore,
organizations that believe in the principles of total
quality are more likely to implement the practices
successfully. Conversely, actions set culture in
motion. As total quality practices are used
routinely within an organization, its people learn
to believe in the principles, and cultural changes
can occur.
Baldrige Core Values and
Concepts
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Visionary leadership
Customer Driven
Organizational and
personal learning
Valuing employees
and partners
Agility
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Focus on the future
Managing for
innovation
Management by fact
Social responsibility
Focus on results and
creating value
Systems perspective
Cultural Change
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Change can be accomplished, but it is difficult
Imposed change will be resisted
Full cooperation, commitment, and participation
by all levels of management is essential
Change takes time
You might not get positive results at first
Change might go in unintended directions
Key Idea
Impatient managers often seek immediate
cultural change by adopting off-the-shelf quality
programs and practices, or by imitating other
successful organizations. In most cases, this
approach is setting themselves up for failure.
Building on Best Practices
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Universal best practices
– Cycle time analysis
– Process value analysis
– Process simplification
– Strategic planning
– Formal supplier certification
programs
Best Practices:
Infrastructure Design (1 of 3)
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Low performers
– process management fundamentals
– customer response
– training and teamwork
– benchmarking competitors
– cost reduction
– rewards for teamwork and quality
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Best Practices:
Infrastructure Design (2 of 3)
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Medium performers
– use customer input and market
research
– select suppliers by quality
– flexibility and cycle time reduction
– compensation tied to quality and
teamwork
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Best Practices:
Infrastructure Design (3 of 3)
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High performers
– self-managed and cross-functional
teams
– strategic partnerships
– benchmarking world-class companies
– senior management compensation tied
to quality
– rapid response
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Implementing Total Quality:
Key Players
Senior management
 Middle management
 Workforce
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Key Idea
Organizations contemplating change must answer
some tough questions, such as, Why is the
change necessary? What will it do to my
organization (department, job)? What problems
will I encounter in making the change? and
perhaps the most important one — What’s in it for
me?
Strategic vs. Process Change
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Strategic change is broad in scope and stems
from strategic objectives, which are generally
externally focused and relate to significant
customer, market, product/service, or
technological opportunities and challenges.
Process change is narrow in scope and deals
with the operations of an organization. An
accumulation of continuously improving
process changes can lead to a positive and
sustainable culture change.
Contrasts
Key Idea
Numerous barriers exist to successfully transform
organizations to a sustained culture of total
quality. Understanding these barriers can help
significantly in managing change processes.
Perhaps the most significant failure encountered
in most organizations is a lack of alignment
between components of the organizational
system.
Common Mistakes in TQ
Implementation (1 of 3)
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TQ regarded as a “program”
Short-term results are not obtained
Process not driven by focus on customer,
connection to strategic business issues, and
support from senior management
Structural elements block change
Goals set too low
“Command and control” organizational culture
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Common Mistakes in TQ
Implementation (2 of 3)
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Training not properly addressed
Focus on products, not processes
Little real empowerment is given
Organization too successful and complacent
Organization fails to address fundamental
questions
Senior management not personally and
visibly committed
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Common Mistakes in TQ
Implementation (3 of 3)
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Overemphasis on teams for cross-functional
problems
Employees operate under belief that more
data are always desirable
Management fails to recognize that quality
improvement is personal responsibility
Organization does not see itself as collection
of interrelated processes
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Sustaining the Quality
Organization
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View quality as a journey (“Race without a
finish line”)
Recognize that success takes time
Create a “learning organization”
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Planning
Execution of plans
Assessment of progress
Revision of plans based on assessment findings
Use Baldrige assessment and feedback
Key Idea
Organizations are dynamic entities. Managers
must consider the dynamic component in order to
deal with instability in the environment, imperfect
plans, the need for innovation, and the common
human desire for variety and change.
Key Activities of Learning
Organizations
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Systematic problem solving
Experimentation with new approaches
Learning from their own experiences
and history
Learning from the experiences and
best practices of others
Transferring knowledge quickly and
efficiently throughout the organization
Self Assessment: Basic
Elements
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Management involvement and leadership
Product and process design
Product control
Customer and supplier communications
Quality improvement
Employee participation
Education and training
Quality information
Key Idea
Self-assessment should identify both strengths
and opportunities for improvement, creating a
basis for evolving toward higher levels of
performance. Thus, a major objective of most
self-assessment projects is the improvement of
organizational processes based on opportunities
identified by the evaluation.
Importance of Follow-Up of
Self-Assessment Results
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Many organizations derive little benefit from
conducting self-assessment and achieve few
of the process improvements suggested by
self-study
Reasons:
– Managers do not sense a problem
– Managers react negatively or by denial
– Managers don’t know what to do with the
information
Key Idea
Following up requires senior leaders to engage in
two types of activities: action planning and
subsequently tracking implementation progress.
Leveraging Self-Assessment
Findings
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Prepare to be humbled
Talk through the findings
Recognize institutional influences
Grind out the follow-up
Implementing ISO 9000
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Start with a quality policy that
identifies key objectives and basic
procedures
Develop a quality manual to document
the procedures
Use internal audits to maintain
procedures
Provide adequate resources
Implementing Six Sigma
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Committed leadership
Integration with existing initiatives, business
strategy, and performance measurement
Process thinking
Disciplined customer and market intelligence
gathering
A bottom line orientation
Leadership in the trenches
Training
Continuous reinforcement and rewards