Transcript Slide 1

Malcolm Baldrige
National
Quality
Award
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• U.S. national quality award
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Leadership
Strategic planning
Customer and market focus
Measurement, analysis, and knowledge mgt
Human resource focus
Process management
Business results
• Formed to bolster U.S. competitiveness
• U.S. president grants awards each year
NIST. (2005e). The malcolm baldrige national quality improvement act of 1987: Public law 100-107. Retrieved June 10, 2005, from http://baldrige.nist.gov/Improvement_Act.htm
NIST. (2005f). Frequently asked questions about the malcolm baldrige national quality award. Retrieved June 10, 2005, from http://www.nist.gov/public_affairs/factsheet/baldfaqs.htm
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Organizational Profile:
Environment, Relationships, and Challenges
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Strategic
Planning
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Human
Resource
Focus
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Business
Results
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Leadership
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Customer
and Market
Focus
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Process
Management
Measurement, Analysis, and Knowledge Management
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NIST. (2005b). Baldrige national quality program: 2005 criteria for performance excellence. Gaithersburg, MD: Author.
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LEADERSHIP (120)
– Senior Leadership (70)
– Governance and Social Responsibilities (50)
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STRATEGIC PLANNING (85)
– Strategy Development (40)
– Strategy Deployment (45)
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CUSTOMER AND MARKET FOCUS (85)
– Customer and Market Knowledge (40)
– Customer Relationships and Satisfaction (45)
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MEASUREMENT, ANALYSIS, AND KNOWLEDGE MANAGEMENT (90)
– Measurement, Analysis, and Review of Organizational Performance (45)
– Information and Knowledge Management (45)
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HUMAN RESOURCE FOCUS (85)
– Work Systems (35)
– Employee Learning and Motivation (25)
– Employee Well-Being and Satisfaction (25)
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PROCESS MANAGEMENT (85)
– Value Creation Processes (45)
– Support Processes and Operational Planning (40)
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BUSINESS RESULTS (450)
– Product and Service Outcomes (100)
– Customer-Focused Results (70)
– Financial and Market Results (70)
– Human Resource Results (70)
– Organizational Effectiveness Results (70)
– Leadership and Social Responsibility Results (70)
NIST. (2005b). Baldrige national quality program: 2005 criteria for performance excellence. Gaithersburg, MD: Author.
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Receive Applications
Independent Review
Select Judges for Consensus Review
Consensus Review
Select Judges for Site Visit
Site Visit Review
Review & Recommend Winners
NIST. (2005d). Overview of award process. Retrieved June 13, 2005, from http://baldrige.nist.gov/Overview.htm
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Year
Manufacturing
Small Business
Education
Health Care
Service
2004
Bama
Texas Nameplate
No. Colorado
2003
Medrad
Stoner
Community
Boeing
Caterpiller
2002
Motorola
Beach Smith
Hamilton
Baptist
St. Luke’s
SSM
2001
2000
1999
1998
1997
1996
1995
Clarke American
Dana, Karlee
Los Alamos Bank
ST Microelectronics
Sunny Fresh
Boeing
Texas Nameplate
Solar Turbines
3M
Solectron
Custom Research
ADAC Labs
Trident Precision
Armstrong, Corning
1994
1993
1992
1991
1990
1989
1988
Pal’s Sudden
Wainwright
Eastman Chemical
AT&T, TI
Zytec, Solectron
Cadillac, IBM
Milliken, Xerox
Westinghouse
Motorola
Ames Rubber
Granite Rock
Marlow
Wallace
Pearl River
Chugach
Wisconsin Stout
Operations Mgt.
Ritz Carlton, BI
Merrill Lynch
Xerox
Dana Credit
AT&T
Verizon
Ritz Carlton, AT&T
FedEx
Global
NIST. (2005a). 1988-2004 award recipients' contacts and profiles. Retrieved June 10, 2005, from http://baldrige.nist.gov/Contacts_Profiles.htm
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Baldrige Winners vs. S&P 500
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1994 1995 1996
1997 1998 1999 2000
2001 2002 2003
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-4
Year
NIST. (2003c). Baldrige stock studies. Retrieved June 13, 2005, from http://baldrige.nist.gov/Stock_Studies.htm
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Category
Employee
Operating
Customer
Satisfaction
Financial
Performance
Measure
Employee Satisfaction
Attendance
Turnover
Safety/Health
Suggestions Received
Reliability
Timeliness
Processing Time
Errors/Defects
Lead Time
Inventory Turnover
Cost of Quality
Cost Savings
Overall Satisfaction
Customer Complaints
Customer Retention
Market Share
Sales per Employee
Return on Assets
Return on Sales
Better
Worse
Same
89%
73%
64%
79%
71%
100%
50%
50%
53%
54%
56%
50%
50%
86%
50%
63%
82%
50%
50%
80%
11%
0%
27%
21%
29%
0%
44%
50%
47%
46%
38%
50%
50%
0%
42%
25%
18%
50%
39%
20%
0%
27%
9%
0%
0%
0%
6%
0%
0%
0%
6%
0%
0%
14%
8%
13%
0%
0%
11%
0%
Mendelowitz, A. I. (1991). Management practices: U.S. companies improve performance through quality efforts (GAO/NSIAD-91-190). Washington, DC: General Accounting Office (GAO).
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• Goal is to test the theory and causal
performance linkages of Baldrige
• Objectives
– Develop a measurement model, scales,
and constructs to model Baldrige criteria
– Test the general theory that leadership
drives the system that creates results
– Provide insight into the directions of
causation among the Baldrige categories
Wilson, D. D., & Collier, D. A. (2000). An empirical investigation of the malcolm baldrige national quality award causal model. Decision Sciences. 31(2), 361-390.
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• Baldrige model contradicts itself
– Leadership impact should be recursive
– Double-headed arrows imply otherwise
– NIST does not understand relationships
– Everything is related to everything else
• Recursive causal model must exist
– Leadership must cause others to improve
– Systems thinking or systems dynamics
– Categories related in recursive model
– Sign of path coefficients must be positive
Wilson, D. D., & Collier, D. A. (2000). An empirical investigation of the malcolm baldrige national quality award causal model. Decision Sciences. 31(2), 361-390.
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H2
SYSTEM
H3
H4
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Leadership
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Process
Management
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Human
Resource
Focus
H7
H8
H15
H9 H10
H16
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Customer
and Market
Focus
- or -
H5
H6
2
Strategic
Planning
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Measurement,
Analysis, and
Knowledge Mgt
H17
H11 H12
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Business
Results
H13 H14
H1
Wilson, D. D., & Collier, D. A. (2000). An empirical investigation of the malcolm baldrige national quality award causal model. Decision Sciences. 31(2), 361-390.
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H1 - H6 — LEADERSHIP PREDICTS
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Business results
Customer and market focus
Process management
Human resource focus
Strategic planning
Measurement, analysis, and knowledge management
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Customer and market focus
Business results
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Customer and market focus
Business results
H7 - H8 — PROCESS MANAGEMENT PREDICTS
H9 - H10 — HUMAN RESOURCE FOCUS PREDICTS
H11 - H12 — STRATEGIC PLANNING PREDICTS
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Customer and market focus
Business results
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Customer and market focus
Business results
H13 - H14 — MEASUREMENT, ANALYSIS, AND KNOWLEDGE MGT PREDICTS
H15 - H17 — MEASUREMENT, ANALYSIS, AND KNOWLEDGE MGT PREDICTS
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Process management
Human resource focus
Strategic planning
Wilson, D. D., & Collier, D. A. (2000). An empirical investigation of the malcolm baldrige national quality award causal model. Decision Sciences. 31(2), 361-390.
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Quantitative research methodology
101-item survey instrument
Instrument validated via Delphi
Two-phase survey
– Pilot survey: 128 firms (29.7% response)
– Final survey: 800 firms (28.3% response)
• Survey calibrated using pilot results
• Two-tailed hypothesis testing
Wilson, D. D., & Collier, D. A. (2000). An empirical investigation of the malcolm baldrige national quality award causal model. Decision Sciences. 31(2), 361-390.
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H2
H7 = 0.455
H3 = 0.229
H4 = 0.379
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Leadership
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Process
Management
5
Human
Resource
Focus
H8 = 0.193
H15 = 0.160
H9 H10
H16 = 0.187
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Customer
and Market
Focus
- or -
H5 = 0.295
H6 = 0.728
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Strategic
Planning
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Measurement,
Analysis, and
Knowledge Mgt
H17 = 0.556
H11 H12
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Business
Results
H13 = 0.267
H14 = 0.245
H1
Wilson, D. D., & Collier, D. A. (2000). An empirical investigation of the malcolm baldrige national quality award causal model. Decision Sciences. 31(2), 361-390.
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• Baldrige theory fundamentally sound
– Leadership drives the system
• However, causal relationships exist
– Baldrige is not recursive, but it should be
• Leadership “not” directly related to
– Customer and market focus
– Business results
• Human resource focus and strategic
planning “not” directly related to
– Customer and market focus
– Business results
Wilson, D. D., & Collier, D. A. (2000). An empirical investigation of the malcolm baldrige national quality award causal model. Decision Sciences. 31(2), 361-390.
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• Strengths
– Top-notch, scholarly peer reviewed article
– Grounded in a strong literature review
– Solid quantitative research methodology
– Internal and external reliability/validity
• Weaknesses
– Bibliography of economic studies is weak
– Plant-level managers surveyed, not execs
– Did not investigate causal links to firmlevel economic performance
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• Good example of quantitative
decision making
• Shows managers how to develop
valid decision analysis models
• Clears up some ambiguity associated
with Baldrige
• Validates strategic importance of
leadership in business improvement
• Lends scholarly credence to the
Baldrige award itself
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Bell, R. R., & Elkins, S. A. (2004). A balanced scorecard for leaders: Implications of the malcolm baldrige national
quality award criteria. SAM Advanced Management Journal, 69(1), 12-17.
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Bell, R., & Keys, B. (1998). A conversation with curt w. reimann on the background and future of the baldrige
award. Organizational Dynamics, 26(4), 51-61.
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Chong, P. S., Calingo, L. M. R., Reynolds, G. L., & Fisher, D. G. (2003). Using an innovative approach to shorten
coaching and assessment time when applying the baldrige health care criteria for performance excellence in a
substance abuse treatment setting. Total Quality Management & Business Excellence, 14(10), 1121-1129.
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Curkovic, S., Melnyk, S., Calantone, R., & Handfield, R. (2000). Validating the malcolm baldrige national quality
award framework through structural equation modelling. International Journal of Production Research, 38(4), 765791.
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Garvin, D. A. (1991). How the baldridge award really works. Harvard Business Review, 69(6), 80-93.
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Hill, R. C. (1993). When the going gets rough: A Baldrige Award winner on the line. The Academy of Management
Executive. 7(3), 75-79.
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Hodgetts, R. M., Kuratko, D. F., & Hornsby, J. S. (1999). Quality implementation in small business: Perspectives
from the baldrige award winners. SAM Advanced Management Journal, 64(1), 37-47.
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Lee, S. M., Rho, B. H., & Lee, S. G. (2003). Impact of malcolm baldrige national quality award criteria on
organizational quality performance. International Journal of Production Research, 41(9), 2003-2020.
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Link, A. N., & Scott, J. T. (2001). Economic evaluation of the baldrige national quality program (Planning Report 013). Gaithersburg, MD: National Insitute of Standards & Technology (NIST).
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Przasnyski, Z. H., & Tai, L. S. (1999). Stock market reaction to malcolm baldridge national quality award
announcements: Does quality pay? Total Quality Management, 10(3), 391-400.
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Przasnyski, Z. H., & Tai, L. S. (2002). Stock performance of malcolm baldrige national quality award winning
companies. Total Quality Management, 13(4), 475-488.
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Rajan, M., & Tamimi, N. (1999). Baldrige award winners: The payoff to quality. Journal of Investing, 8(4), 39-42.
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Shetty, Y. K. (1993). The quest for quality excellence: Lessons from the malcolm baldridge quality award. SAM
Advanced Management Journal, 58(2), 34-40.
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Wilson, J. P., Walsh, M. A. T., & LaScola-Needy, K. (2003). An examination of the economic benefits of ISO 9000 and
the baldrige award to manufacturing firms. Engineering Management Journal, 15(4), 3-10.
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Kan, S. H. (1991). Modeling and software development quality. IBM Systems
Journal, 30(3), 351-362.
Kan, S. H. (2002). Metrics and models in software quality engineering.
Reading, MA: Addison Wesley.
Kan, S. H., Basili, V. R., & Shapiro, L. N. (1994). Software quality: An
overview from the perspective of total quality management. IBM Systems
Journal, 33(1), 4-19.
Kan, S. H., Dull, S. D., Amundson, D. N., Lindner, R. J., & Hedger, R. J. (1994).
AS/400 software quality management. IBM Systems Journal, 33(1), 62-88.
Kan, S. H., Parrish, J., & Manlove, D. (2001). In-process metrics for software
testing. IBM Systems Journal, 40(1), 220-241.
Kekre, S., Krishnan, M. S., & Srinivasan, K. (1995). Drivers of customer
satisfaction for software products: Implications for design. Management
Science, 41(9), 1456-1470.
Pine, B. J. (1989). Design, test, and validation of the application system/400
through early user involvement. IBM System Journal, 28(3), 376-385.
Sulack, R. A., Lindner, R. J., & Dietz, D. N. (1989). A new development rhythm
for AS/400 software. IBM Systems Journal, 28(3), 386-406.
Tang, V., & Collar, E. (1992). IBM AS/400 new product launch process
ensures satisfaction. Long Range Planning, 25(1), 22-27.
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Are Baldrige and Six Sigma related?
Does Baldrige address innovation?
Should Baldrige address globalization?
Does Baldrige bolster competitiveness?
Is Baldrige specific to U.S. culture?
Is Baldrige too broad and diluted?
What are the costs/benefits of Baldrige?
Does Baldrige encourage competition
based on cost and quality vs. Michael
Porter’s strategic positioning?
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