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There are two reasons why the Japanese are so successful in quality control: (1) strong
motivation of the employees, and (2) employees have positive attitude toward their business
organization. You may have clearly defined policies, procedures and guidelines of the organization
still there shall be lots of deviation of employees for lack of motivation in doing their jobs in fact,
business organization with good employee involvement will need few written directions for
employees to follow. Directives will be general in nature, more like an agreement, because the
employees help to formulate the policies.
The effective means to attain and sustain quality and productive employees is to make them
part of the organization. Employees who believe that they are part of the organization and
important will be motivated to ensure their contributions to the organization are consistent and
dependable. This concept applies to all, from the lowest classification to the top management.
Motivation comes from such various sources such as supervisors, all levels of management and
fellow employees. Pride and prestige in the form of motivating factors are easily passed on.
Activity in the area of motivation must be sincere, not a checklist-type of action. Insincere actions
will do great harm; employees know the difference sincerity and make-believe. Employee
involvement program cannot become another unproductive job.
1. Improving morale
2. Improving job skills
3. Utilizing power and timely communication skills
4. Having a safe work environment
5. Exercising good management skill
6. Acknowledging that job security is important
7. Developing a good communication system
Effective communication is one of the keys to motivation. Employees need to know that
they are important, as individuals, not as numbers.
Supervisors can make the work enjoyable, interesting and emphasize the importance of
each to the entire success of the organization. They should also use recognition and award to
motivate employees. Employee participation can be a great asset to the organization. The Japanese
manufacturing managers freely admit that their employees participation contributed greatly to
their success. Honda attributes increase in profits each year to employee suggestions. In fact, many
of the most successful business organizations have a distinct and effective employee participation
program.
Dr. Abraham H. Maslow is a very famous for his motivation ideas expressed in the
hierarchy theory. This is the most quoted of all the theories existing today. Maslows hierarchy
consisted of five levels. These levels are survival, security, social, esteem and, self-actualization.
Relating these human needs to motivation, we know that level 1 (survival), means food,
clothes and shelter which is usually provided by a job. Level 2 (security) can mean a safe place to
work and job security, which are very important to employees. When business organization
demonstrates an interest in the personal well-being of employees, it is a motivating factor. A threat
of losing ones job certainly does not enhance motivation. Level 3 (social) relates to our need to
belong, because we are social creatures. It has been said that cutting someone out of the group is
devastating to that individual. Isolation is an effective punishment. Conversely, giving the
individual the opportunity to be part of the group by feeling important and needed will motivate
that person. Being a member of a committee is good way to bring employees into the group. Level
4 (esteem) relates to pride and self-worth. Everyone, regardless of position or job assignment wants
to be recognized as a person of value to the organization. Seeking an advice or input into business
or production process is a good way of telling employees that they are of value. Level 5 (self-
actualization) says that individuals must be given the opportunity to go as far as their abilities will
make them. Many organizations have a policy of promotion within. It is true that some employees
do not want to move up to the corporate ladder, which is understandable. However, those who do
want to move up must know that it is impossible.
It is important to note that as employees move up the hierarchy, they will immediately
revert back to the previous level if they feel threatened.
1. Avoid work
2. No ambition
3. No initiative
4. Do not take responsibility
5. Needs security
1. Reward
2. Coerce
3. Intimidate
4. Punish
If this theory is applicable to any employee, then the organization cannot function with
such employees. This theory assumes that the employees cannot be trusted and the employees have
to be supervised at all time.
1. Want to learn
2. Work is a natural activity
3. Has selfdiscipline
4. Develop themselves
These employees do not get motivated as much as by any reward, but they seek free-all by
themselves. If the managers can guide the employees in identifying challenging jobs, the potential
of the employees will be realized.
Frederick Herzberg has divided the motivational aspects of human beings into the
following:
1. Hygiene Theory
2. Motivation
The hygiene theory is the minimum that every employee requires for now being
dissatisfied. Without the above, the employee will get dissatisfied. These are basic needs. Further
efforts are needed to motivate the employees.
1. The company
2. Its policies and administrations
3. The kind of supervision which people receive while in the job
4. Working conditions
5. Interpersonal relations
6. Salary
7. States
8. Security
1. Achievement
2. Recognition for achievement
3. Interest in the task
4. Responsibility for enlarged task
5. Growth and advancement to higher level tasks
Recognition
Recognition is a process whereby management shows acknowledgement of an
employees outstanding performance. Whether the employee is an introvert or extrovert, it is
important to recognize them for their hard work.
Important role in
Awards
Awards are forms of employees involvement in which the organization identifies and
gives recognition to employees who made a positive contribution to the organizations success.
Example: Safety awards should warrant a greater award than reducing tardiness.
Awards may be such things as a:
1. Bonus
2. Salary increase
3. Change in title
4. Promotion
5. Concert tickets
6. Educational tour and etc.
In Japanese Companies
Their award system certainly plays a major role in providing incentives for employees to
produce to their maximum potential and to take pride in quality of work.
In this connection...
Management should make certain that the organizations priorities are what employees
believe they are. If employee are rewarded for something they do and believe is
important the incentive aspect is lost. Incentive will not force them to strive for
excellence but will encourage them to do so.
Recognition and Award does NOT necessarily means MONEY but it can be:
Organization cares
Peer recognition
Simple handshake
Pat on shoulder to a party or a formal banquet in honor of the individual or team
It should be appropriately presented, so that fellow employees will know about it.
There are some suggestions for presenting awards
o Frame certificates
o Use the local press to inform family and friends about awards received
Involving employees, empowering them, and bringing them into the decision-
making process provide the opportunity for continuous process improvement. The latent
potentialities, ideas, innovation and creative thoughts of employees can make the
difference between success and failure.
2. Employees are more likely to implement and support decisions they had a part in making.
3. Employees are better able to spot and pinpoint areas for improvement.
The outputs can be used by the quality council to initiate improvement activities
and tasks.
Performance Appraisal of Employees
Employees should be made aware of appraisal process, what is evaluated, and how
often. They should be told how they are doing on a continuous basis, not just appraisal
time.
Appraisal format
TYPE DESCRIPTION
GRAPHIC Major duties by employees are rate with scale ( 1=poor ; 5=excellent )
EMPLOYEE EMPOWERMENT
Empowerment as defined by Xerox Corporate Management Institute (XCM) is an
organizational state, where people are aligned with business direction and understand their
performance boundaries, thus, enabling them to take responsibility and ownership while seeking
improvements, identifying the best course of action and identifying steps to satisfy customer
requirements.
Empowerment means transfer of responsibility of satisfying customer to employees.
TEAM BUILDING
Is a fundamental part of the empowerment process. Supervisors play a key role in
effective team building and without their support it will fail.
Common Reasons why Supervisors do not support empowering teams
What is a team?
Consensus decision-making plays a major role: A consensus can be reached best by each
participant being willing to listen to others opinions. Each team member shall contribute his or
her skills, knowledge, and expertise.
TEAM TRAINING
Working as a team is a new concept to many employees. Training is very important for
an effective team. The quality council must take an active role in establishing the training
program.
The training must be experimental, because the trainees will retain 20% of what they do.
Training should be practical when possible, role-playing and case studies should be used.
Trainers should be carefully selected for their knowledge, enthusiasm, and respect from the
trainees. A clear picture of the objectives and how each member will benefit must be in place.
Team leaders should be receptive to suggestions and make changes where warranted.
The team leaders shall play an important role in team building. Some business organizations
provide on-site trainings. Consultants are also available in training in human relations,
motivation, conflict resolution, and communications. A well-trained team leader can help
ineffective teams to improve, but team members usually cannot help an ineffective team leader.
Benchmarking
A. Elements of Benchmarking
1. Unit of measure
These are called metrics and are usually expressed numerically. The numbers
realized by the best-in-class benchmark are the target. The organization
looking for improvement the plots its own performance against the target.
2. Performance Difference
Benchmarkers must develop a thorough and in-depth knowledge of both their
own processes and the processes of the best-in-class organization.
B. Reasons to Benchmark
o Benchmarking is a tool to attain business and competitive objectives. It is powerful
and effective when used for the right reasons and aligned with organization strategy.
o Benchmarking is one tool to help business organizations develop strengths and lessen
weaknesses.
o Benchmarking requires an external orientation, which is critical in an environment
where the competition can easily be on the other side of the coin. The external
environment of an organization are those factors outside the company that affect the
company's ability to function.
o Benchmarking allows business organizations to be set objectively based on external
information.
o Benchmarking is time and cost efficient. Because the process involves imitation and
adaptation rather than pure invention, time and money are saved.
o Benchmarking enhances innovation by requiring its practitioners constantly to scan
the external environment and to use the information gathered to improve the process.
o The major weakness of benchmarking is the fact that best-in-class performance is a
moving target. New technology can create quantum leap performance improvements.
C. Process of Benchmarking
1. Decide what to benchmark
2. Understand current performance
3. Plan
4. Study others
5. Learn from the data
6. Use the findings
AT&Ts 12 Steps Process Xeroxs 10 Step Process
1. Determine who the clients are. 1. Identify what is to be benchmarked
2. Advance the clients from the literacy 2. Identify comparative organizations.
stage to the champion stage.
3. Test the environment. 3. Determine data-collection method and collect
data.
4. Determine urgency. 4. Determine current performance gap.
5. Determine scope and the type of 5. Project future performance levels.
benchmarking needed.
6. Select and prepare the team. 6. Communicate benchmark findings and gain
acceptance.
7. Overlay the benchmarking process 7. Establish functional goals.
onto the business planning process
8. Develop the benchmarking plan. 8. Develop action plans.
9. Analyze the data. 9. Implement specific actions and monitor
progress.
10. Integrate the recommended actions. 10. Recalibrate benchmarks.
11. Take action.
12. Continue improvement.
Approaches to Benchmarking (AT&T and Xerox)
o When deciding what to benchmark, it is good to start by thinking about the vision,
mission and critical success factors.
o Pareto Analysis is a useful technique for deciding what processes to evaluate. It is
effective to begin with the process output and trace back to the input, asking what, how,
where and why questions along the way.
o Cause-and-effect diagrams are an excellent tool for tracing outputs back to inputs and
to evaluate factors that influence the process.
o Numerical measures illustrate the effects of improvement and thereby help in deciing
where to direct benchmarking activities.
(Continuation)
BENCHMARKING- the process of comparing a particular company with a set of benchmark
companies.
Learning from the data gathered in a benchmarking study involves answering a series of
questions:
Is there a gap between the organizations performance and the performance of the best-in-
class organizations?
Why there is a gap? What does the best-in-class do differently that is better?
If best-in-class practices were adopted, what would be the resulting improvement?
When the benchmarking study shows a negative gap in performance, the objective
is to change the process to close the gap. If a change is not the result, the process has been
a waste of time. To effect change, the findings must be communicated to the people within
the business organization who can enable improvement.
When findings are done objectively, the benchmarking process helps make the case
to both groups. The effect of change can be predicted quantitatively and the process can be
fully described.
The primary goal is to attain perfection by continuously improving the business and production
processes. Ideally, perfection is an elusive goal; however, we must continuously aspire for its
achievement.
Process refers to business and production activities of all organizations. Business processes such as
purchasing, engineering, accounting, budgeting, and marketing areas where nonconformance can
represent an opportunity for substantial improvement. Figure below reveals a process with its inputs
and outputs. Inputs may be materials, money, information, data, etc. Outputs may be information, data,
products, services, etc. In fact, the output of one process can be the input to another process. Outputs
usually require performance measures
Process definition starts with defining the internal and/or external customers. The customer defines the
purpose of the organization and every process within it. Business organization exist to ensure the
customer, therefore, process improvements must be defines in terms if increased customer satisfaction
because of higher quality products and services.
The process is the interaction of some combination of people, materials, equipment, method,
measurement, and the environment to produce an outcome such as a product, service, or an input to
another process. In addition to having measurable input and output, a process must have value-added
activities and repeatability. It must be effective, efficient, under control and flexible. All processes must
have an owner. In some cases, the owner is obvious, because there is only one person performing the
activity. Frequently the process will cross multiple organizational boundaries and individuals within each
of the organizations will own supporting sub-processes. Thus, ownership must be part of the process
improvement initiatives.
There are five basic ways of improvement, according to H. Besterfield:
1. Reduce resources;
2. Reduce errors;
3. Meet or exceed expectations of downstream customers;
4. Make the process safer; and
5. Make the process more satisfying to the person doing it.
The last way to improve a process is to increase the satisfaction of the individual performing the
process. Although it is difficult to quantify, the evidence suggests that a happy, satisfied employee is a
more productive one. Sometimes s little change, such as a better table, can make a substantial change in
a persons attitude.
Process improvement involves proper planning. Dr. Joseph M. Juran developed three components of
process improvement, such as planning, controlling, and improvement.
Planning
The planning component starts with external customers. Marketing determines the external customers
and all organizational personnel, either as managers or as members of multifunctional teams or work
groups, determine the internal customers. External customers may be quite numerous, as is the case of
a bank supply organization, where they tellers, financial planners, loan officers, auditors, managers, and
the banks customers. Where there are numerous customers, a Pareto diagram might be useful to
determine the vital few.
Once the customers are identified, their needs are discovered. This activity requires the customers to
tell their needs in their own words and from their own viewpoint. Real needs may differ from stated
needs. Example, a stated need may be a car, whereas the real need is transportation or a status symbol.
Internal customers may not voice real needs out of fear pf the consequences. There are methods that
can be used for discovering these needs, such as:
Customer needs must be translated to requirements that are understandable to the business
organization and its suppliers.
Next in the planning process is to develop product and/or service features that respond to customer
needs, meet the needs of the business organization and its suppliers, be competitive, and optimize the
costs of all stakeholders. A multifunction team is performing this step. Quality Function Deployment
(QFD), Taguchis Quality Engineering (TQE), and Concurrent Engineering (CE) are but some of the
approaches that can be used. It is important that the design team, rather than a single department,
approve the final design and that the team can be composed of all functional areas within a business
organization as well as customers and suppliers.
Next, is to develop the processes able to produce the product and/or service features. Some of these
would have occurred during the final step. A multifunctional team, with lessons to the design team, also
does it. This includes the following:
1. Necessary facilities
2. Training
3. Operation
4. Control; and
5. Maintenance of the facilities
Particular concern will be the scaling from the laboratory or prototype environment to the real process
environment. Additional activities include process capability evaluation and process control type and
location.
Translating plans to operation is the final step of the planning process. A multifunctional team with
liaison to the other teams will be used. When training is necessary, members of the process planning
team should perform it. Process validation is necessary to ensure, with a high degree of assurance, that
a process will consistently produce a product or service that meets requirements.
Control
Control is used by operating forces to help meet the product, process, and service requirements. It uses
the feedback loop and consists of the following steps:
Statistical Process Control (SPC) is the primary techniques for achieving control. The basic SPC tools are
histograms; control charts, and scatter diagrams.
Improvement
This part aims to achieve levels of performance that are significantly higher than current levels. Process
improvements begin with the establishment of an effective infrastructure such as the quality council.
Two of the duties are to identify improvement projects and establish the project teams. Furthermore,
the quality council needs to provide the teams. Furthermore, the quality council needs to provide the
teams with the resources to determine the cause, create solutions, and establish controls to hold the
gains. The problem-solving method described in the next section is the technique to improve the
process and the quality council is the driver that ensures that improvement is continuous and never-
ending journey.
Problem-Solving Method
Process improvement attains the greatest results when it operates within the framework of the
problem-solving method. In the initial stage of the program, quick results are frequently obtained
because the solutions are obvious or an individual has a brilliant idea. However, in the long term a
systematic approach will yield the greatest benefits.
The problem-solving method has many variations depending, to some extent, on the use; however, they
are all similar. There are seven phases, as can be gleaned in the figure below.
The phases are integrated and they are all dependent upon the previous phase. Continuous process
improvement is the goal, and these phases are the framework to achieve that goal, as advanced by U.S.
Army Aviation System Command (U.S. AASC).
Phase 1: Identify
the Opportunity
Phase 7:
Phase 2: Define
Continuously
the Scope
Improvement
Continuously
Phase 6: Phase 3: Analyze
Pilot/Verify the Current
Changes Process
Phase 5: Phase 4:
Implement Envision the
Changes Future Process
The objective of this phase is to identify and prioritize opportunities for improvement. It has two parts:
identify the problem and form the team. Problem identification answers the question and the answer
leads to those problems that have the greatest potential for improvement and have the greatest need
for solution. Problems can be identified from a variety of inputs, such as the following:
1. Pareto analysis of repetitive external alarm signals, such as fields failures, complaints, returns,
and others.
2. Pareto analysis of repetitive internal alarm signal (example: scrap, rework, sorting, and the 100%
test).
3. Proposals from key insiders (managers, supervisors, professionals, and union members).
4. Proposals from suggestion schemes.
5. Field study of users needs.
6. Data on performance of products versus competitors (from users and from laboratory tests).
7. Comments of key people outside the organization (customers, suppliers, journalists, and critics).
8. Findings and comments of government regulators and independent laboratories.
9. Customer surveys.
10. Employee surveys.
11. Brainstorming by work groups.
Problems provide opportunities for improvement. There are three criteria to qualify as a problem:
Finding problems is not too difficult, because there are many more that can be analyzed. The quality
council or work group must prioritize them using the following selection criteria:
A work group that needs to select its initial problem should find one that gives the maximum benefit for
the minimum amount of efforts.
The second part of Phase 1 is to form a team. If the team is a natural work group, then this part is
complete. If the problem is of a multifunctional nature, as are most, then the team is selected and
tasked by the quality council to address the improvement of a specific proves. The team leader is
selected and becomes the owner of the process. Goals and deadlines are determined.
Failure in problem solving is frequently caused by poor definition of the problem. A problem well stated
is half solved.
In addition to the problem statement, this phase requires a comprehensive charter for the team. The
charter must specify the following:
The objective of Phase 3 is to understand the process and how it is currently performed. Key activities
are to determine the measurements needed to analyze the process; gather data; define the process
boundaries, outputs and customers, inputs and suppliers, and process flow; identify root causes; and
determine levels of customer satisfaction.
The first step is for the team to develop a process flow diagram. A flow diagram translates complex work
into an easily understood graphic description. This activity is an eye-opening experience for the team,
because it is rare that all members of the team understand the entire process.
Next, target performance measures are defined. Measurements are fundamental to meaningful process
improvements. If something cannot be measured, it cannot be improved. There is an old saying that
what gets measured gets done. The team will determine if the measurements needed to understand
and improve the process are presently being used; if new ones are needed, they will:
Once the target performance measures are established, the team can collect all available data and
information. If these data are not enough, then additional new information is obtained. Gathering data
(1) helps confirm the that problem exists, (2) enables the team to work with facts, (3) makes it possible
to establish measurement criteria for baseline, and (4) enables the team to measure the effectiveness of
an implemented solution. It is important to collect not only needed data and to get the right data for the
problem. The team should develop a plan that includes input from internal and external customers and
ensures the plan answers the following questions:
Data can be collected by using check sheets, by computers with their application software, by data-
collection devices such as hand-held gauges, and by an on-line system. The team will identify the
customers and their expectations as well as their inputs, outputs, and interfaces of the process. Also,
they will systematically review the procedure currently being used.
The cause-and-effect diagram is particularly effective in this phase. Determining all the causes requires
experience, brainstorming, and a thorough knowledge of the process. It is an excellent starting point for
the project team. One word of caution- the object is to seek causes, not solutions. Therefore, only
possible causes, no matter how trivial, should be listed.
It is important to identify the root, or most likely, cause. This activity can sometimes be determined by
voting. It is a good idea to verify the most likely cause, because a mistake here can lead to the
unnecessary waste of time and money. Some verification techniques are:
Once the root, or most likely the, cause is determined, the next phase can begin.
PROBLEM-SOLVING METHOD
Phase 4: Envision the future process
Phase 4 has the objective of establishing problem solutions and recommending
the optimal solution to improve the process. Once all information is available, the project
team begins its search for possible solutions. More than one solution is frequently
required to remedy a situation.
According to P. Mallete, there are three types of creativity: (1) Create new
processes, (2) Combine different processes, or (3) Modify the existing process. The first
type is innovation in its highest form. Combining two or more processes is a synthesis
activity to create a better process. It is a unique combination of what already exists.
Modification involves altering a process that already exists so that it does a better job. It
succeeds when manager utilize the experience, education, and energy of empowered
work group or project teams.
The contents of the Implementation plan report must fully describe, such as:
Once approved by the quality council, it is imperative to obtain the advise and
consent of departments, functional areas, teams, and individuals that may be affected by
the change. A presentation to these groups will help gain support from those involved in
the process and provide an opportunity for feedback with improvement suggestions.
The last element of the implementation plan is the monitoring activity which answers the
following:
1. What information will be monitored or observed and what resources are required?
2. Who will be responsible for taking the measurements?
3. Where will the measurements be taken?
4. When will the measurements be taken?
The team should meet periodically during this phase to evaluate the results to see
that the problem has been solved or if fine-tuning is required. In addition, the will wish to
see if any unforeseen problems have developed as a result of the changes. If the team is
not satisfied, then some of the phases needs to be repeated.
KAIZEN
Kaizen, a Japanese word, is the process of continuous improvement in small
increments that makes the process more efficient, effective, under control, and adaptable.
Improvements are usually accomplished at little or no expense without sophisticated
techniques or expensive equipment. It focuses on simplification by breaking down
complex processes into their sub-processes and them improving them.
Many business organizations are finding that strategic quality plans and business plans are
inseparable. The period of time for strategic planning is three to ten years and short term
planning is one-year (annual) or less. Both types of planning requires goals and objectives.
Strategy provides a way to deal with changes and their accompanying uncertainty both inside
and outside the organization.
According to John Pessico jr. and Gory N. Mclean, goals and objectives have basically the
same meaning. The similarities between the two are differentiated by using goals for long term
and objectives for short term planning are the following:
1. Goals have certain characteristics that make them effective. The most important one is
that they be measurable. Only measurable goals can be evaluated.
2. Goals must be based on statistical knowledge of the system, goals do not merely reflect
the assumption that slogans, exhortations, and hard work will miraculously change the
system.
3. Goals must be definitive, specific, and understandable, using results rather than behaviors
or attitudes. In addition, a specific time frame or deadline should be given.
4. Goals must have a plan or method of utilizing resources for their achievement. If there is
no cause-and-effect relationship between the goal and the method, then the goal is not
valid one.
5. Goals must be challenging, yet achievable. Those individuals, work group, departments
and functional areas that are affected by the goals should be involved in their development.
Stretch goals are satisfactory, provided they are based on benchmark data.
6. The characteristics of objectives are identical to those given here for goals. They are
operational approaches to attain goals.
1. Customer needs. The first step is to discover the future needs of the customer. Who will
they be? Will your customer base change? What will they want? How will the
organization meet and exceed expectations?
3. Predict the future. The planners must look into their crystal balls to predict future
conditions that will affect their product or service. Demographics, economics forecasts,
and technical assessment or projections are tools that help predict the future. More
than one organization's product or service has become obsolete because it failed to
foresee the changing technology. Note that the rate of change is continually increasing.
4. Gap analysis. This step requires the planners to identify the gaps between the current
state and the future state of the organizations. An analysis of the core values is an
excellent technique for pinpointing gaps.
5. Closing the gap. The plan can now be developed to close the gap by establishing goals
and responsibilities. All stake holders should be included in the development of the
plan.
6. Alignment. As the plan is developed, it must be aligned with the mission, vision and
core values of the organization. Without this alignment, the plan will have little chance
of success.
7. Implementation. This last step is frequently the most difficult. Resources must be
allocated in collecting data, designing changes, and overcoming resistance to change.
Also part of this step is the monitoring activity to ensure that progress is being made.
The planning group should meet at least once per year to assess progress and take any
corrective action.
Levels of Strategy
Corporate strategy describes companys overall direction in terms of its various
business and product lines sometimes called grand strategy. Corporate strategy is the
direction an organization takes with the objective of achieving business success in the
long term. Recent approaches have focused on the need for companies to adapt to and
anticipate changes in the business environment, Four basic corporate strategy types are
recognized; growth, stability, defensive, and combination.
Business strategy is formulated at the business-unit level or product level. This strategy
emphasizes on the strengthening of companys competitive position of products or
services. Business strategies are composed of competitive and cooperative strategies.