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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.

One of the major responsibilities of a supervisor is to assist employees in directing their

efforts toward those things that satisfy their personal well-being and performing their job well to
produce high quality products to be competitive, thereby providing job security to the employee.

Every organization, down to specific positions, offers opportunities for motivation.

Motivating factors include such thing as:

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

Giving feedback to employees is very important in motivating them. A sense of power

comes from notification, signed by the top-level management, that their suggestions have been
adopted and an appropriate award is forth coming. This approach certainly motivates employees
to look better for better ideas that will help their organizations and, in fact, help them.
Managements responses to suggestions should be timely. Even when a suggestion is not adopted
by the organization, the fact that it was considered motivates employees to try again. Employees
like to believe that they are special and important in the organization.

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.

Example: If an employee is satisfied in Level 3, a rumor of downsizing may cause an

immediate return to Level 2.

Sigmund Freud is the author of Theory X. Theory X characterizes employees as given


1. Avoid work
2. No ambition
3. No initiative
4. Do not take responsibility
5. Needs security

To make the employees work, management has to do the following:

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.

Douglas Mc Gregor is the author of Theory Y. Mc Gregors theory of people is given


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

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.

Hygiene Theory includes:

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

Motivation Factors include:

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 and Celebration

Recognition and celebration has an important role in motivation and employee

satisfaction. They are powerful moves for letting employees know they are important members
of the business organization. They also recognize and promote goal related activities

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

Motivation and employee satisfaction

Improve employees morale and stimulate creative efforts

Create satisfied and highly motivated workplace

Show the companys appreciation for better performance

In organizations, since behavior is influenced and reinforced by reward and recognition,

and since things that are rewarded are the things that are performed, a basic tool for creating such
change is through reward and recognition

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.

It should be appropriate to the situation

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:

Individuals Feeling of value

Organization cares

Peer recognition

It may be given in variety of ways

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 Relate the award to achievement

o Frame certificates

o Presents the award by the appropriate level of management

o Use the local press to inform family and friends about awards received

o Present the award in the appropriate surroundings Presenting Awards

o Vary the method of presenting awards

o Diversity the award

Examples: concert tickets / basketball tickets

Benefits derived from employee involvement

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.

Benefits that can be derived from employees involvement, as stated by D.H.


1. Employees make better decisions using their expert knowledge of process.

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.

4. Employees are better able to take immediate corrective actions.

5. Employees involvement reduces labor/management problems.

6. Employees involvement increases morale by creating a feeling of belonging to the


The outputs can be used by the quality council to initiate improvement activities
and tasks.
Performance Appraisal of Employees

According to Edwin Flippo, performance appraisal is the systematic, periodic

and impartial rating of an employees excellence, in matters pertaining to his present job
and his potential for a better job.

Objectives of performance appraisal:

To improve performance
Let employees know how they are doing
Provide basis for promotions, salary increase, and other purposes related to
employees future

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

Appraisal format


RANKING Compares employees by ranking from highest to lowest

NARRATIVE Gives a written description of employees strengths and weaknesses

GRAPHIC Major duties by employees are rate with scale ( 1=poor ; 5=excellent )

FORCED Employees are in category with pre-determined percentage ( excellent-30% ;

very good-25% ; good-20% ; fair-15% ; poor-10%)

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
Empowerment means transfer of responsibility of satisfying customer to employees.

Empowerment is an understanding of who I am, how do I relate to higher management, how do I

relate to fellow employees, how do I change my old ways, and what is expected of me.

Empowerment usually requires a change in the organizations infrastructure. Employees will be

more motivated to accomplish organizational goals and objectives if they have the authority to
make decisions.

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

1. Reluctance to give up power.

2. Preconceived ideas about subordinates.
3. Ultimately held accountable.

What is a team?

A Team is defined as a group of individuals working together to achieve common goals

and objectives.
Empowered teams are not easy to organize. It is important to members that teams must have
boundaries to prevent confusions. Resistance to change will definitely be present. Keeping
employees well-informed will reduce resistance, especially when they see how they will benefit
from change. Change must take place if business organization is to continue to exist in the
competitive world.


1. Forming the exploration period for the team.

2. Storming the stage that has rivals within the team.
3. Norming the happy, harmonious relationship for the team.
4. Performing the stage where effective decisions are made.
The backbone of the team building is a trust-trust in each other and trust in the integrity of the
team. Team members must believe in each other, have an appreciation of what each team
member has to offer and the skills involved, and recognize the differences in people and how
these differences contribute to the teams success.
While teams have proven to be very successful in many business organizations, they are not free
from problems. Breaking, long-standing, pyramid style management processes takes time. It is
difficult to get away from issuing directives from the top down through layers of middle and
first-line managers to get ideas up through the system. It is not easy for the pyramid-trained
managers to work with teams instead of individuals. No matter how good the organizational
looks on paper, teams will not be very effective unless supervisors follow up their words with

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.

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
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.

Steps in Training Process

1. Make everyone aware of what the training is all about.

2. Acceptance
3. Adapt the program
4. Adapt to what has been agreed upon.
In addition to team training, all members must receive training in quality awareness (TQM),
problem solving (SPC), safety, and technical aspects of the job.

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.

o According to L. S. Pryor, Benchmarking is measuring performance against that of best-

in-class organizations, determining how the best in class achieve those performance
levels, and using the information as the basis for goals, strategies, and implementation.

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
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
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
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
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
10. Integrate the recommended actions. 10. Recalibrate benchmarks.
11. Take action.
12. Continue improvement.
Approaches to Benchmarking (AT&T and Xerox)

D. Selecting what to Benchmark

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.
BENCHMARKING- the process of comparing a particular company with a set of benchmark

I. Understanding Present Performance

It is necessary to properly understand and document the present process.

a. By using several techniques, such as flow diagrams and cause-and-effect
diagrams, aid understanding.
b. By using tactful questioning determines the conditions that result in exception to
the normal routine. Exceptions commonly consume a good deal of the process
resources, however, process participants may not think to mention them during
c. By using of the units of measure is necessary to quantify the documenting process.
These are the metrics used during the benchmarking process: unit cost, hourly rates,
asset measures and quality measures.

II. Learning from the Data

Learning from the data gathered in a benchmarking study involves answering a series of
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?

Benchmarking studies can show the 3 different outcomes:

1) Negative Gap- external processes may be significantly better than internal processes.
2) Parity- process performance may be approximately equal.
3) Positive Gap- internal processes may be better than external processes.

III. Using the Findings

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.

2 Groups must adopt the change:

A. First Group- consists of the people who will execute the plan, the process owners.
B. Second Group- consists of the people who can enable the process by incorporating
changes into the planning process.
Process changes are likely to affect upstream and downstream operations as well as
suppliers and customers. Therefore, management has to know the basis and payoff of new
goals and objectives in order to support the change.

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.

Steps for the development and execution of action plans:

1) Specify tasks.
2) Sequence tasks.
3) Determine resource needs.
4) Establish task schedule.
5) Assign responsibility for each task.
6) Describe expected results.
7) Specify methods of monitoring results.
Goals and objectivesshould be consistent with the execution of the plan so that the end
result is process superiority.

IV. Basic Criticisms of Benchmarking

Basically, benchmarking can be summed up quite simply. The most persistent criticism of
benchmarking comes from the idea of copying others. How can a business organization be truly
superior if it does not innovate to get a head of competitors? It is a good question, but one can
also ask the reverse. How can an organization even survive if it loses track of its external
environmental forces?
Benchmarking is not a cure/ remedy. It is not a strategy, nor is it intended to be a business
philosophy. It is an improvement tool. To be effective, it must be used for processes that
dont offer much opportunity to the business organization.
Benchmarking is not a substitute for innovation; however, it is a source of ideas from
outside the organization. Business success depends on setting and achieving goals and

Focus on Processes and Improvement Plan

Importance of Continuous Process Improvement

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

We continuously improve by:

1. Considering all work as a process, whether it is associated with production or business

2. Doing effective, efficient, and adaptable processes.
3. Forecasting changing customer needs
4. Regulating in-process performance using measures such as scrap reduction, cycle time, control
charts, etc.
5. Keeping constructive dissatisfaction with the present level of performance
6. Removing waste and rework whenever it occurs
7. Evaluating activities that do not add value to the product or service, with the aim of removing
those activities
8. Removing nonconformities in all phases of everyones work, even if the increment of
improvement is small
9. Benchmarking to improve competitive advantage
10. Planning to achieve breakthroughs
11. Keeping gains so there is no regression
12. Integrating lessons learned into future activities
13. Employing technical tools such as Statistical Process Control (SPC), experimental design,
benchmarking, Quality Function Development (QFD), etc.

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


Materials Equipment Information
Money Method Data
Information Procedures Product
Data, etc. Environment Service, etc.


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.

The Juran Trilogy

Process improvement involves proper planning. Dr. Joseph M. Juran developed three components of
process improvement, such as planning, controlling, and improvement.


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:

1. Being a user of the product or service,

2. Communicating with customers through product or service satisfaction and dissatisfaction,
information, and
3. Simulation in the laboratory.

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

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 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:

1. Evaluate actual operating performance

2. Compare actual performance to goal
3. Act on the difference

Statistical Process Control (SPC) is the primary techniques for achieving control. The basic SPC tools are
histograms; control charts, and scatter diagrams.


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
the Scope

Phase 6: Phase 3: Analyze
Pilot/Verify the Current
Changes Process

Phase 5: Phase 4:
Implement Envision the
Changes Future Process

Basic Continuous Process Improvement Cycle

Phase 1 Identify the Opportunity

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%
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:

1. Performance varies from an established standard.

2. Deviation from the perception and the facts.
3. The cause is unknown, if we know the issue, there is no 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:

1. Is the problem important and not superficial and why?

2. Will problem solution contribute to the attainment of goals?
3. Can the problem be defined clearly using numbers?

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.

Phase 2 Define the Scope

Failure in problem solving is frequently caused by poor definition of the problem. A problem well stated
is half solved.

There are criteria for a good problem statement:

1. It clearly describes the problem and is easily understood.

2. It states the effect- what is wrong, when it happens, and where it is occurring, not why it is
wrong or who is responsible.
3. It focuses on what is known, what is unknown, and what needs to be done.
4. It uses facts and is free of judgment.
5. It emphasizes the impact on the customer.

In addition to the problem statement, this phase requires a comprehensive charter for the team. The
charter must specify the following:

1. Authority: Who authorize the team?

2. Objective and scope: What are the expected outputs and specific areas to be improved?
3. Composition. Who are the team members, process, and sub-process owners?
4. Direction and control. What are the guidelines for the internal operation of the team?
5. General. What are the methods to be used, the resources, and the specific milestones?

Phase 3 Analyze the Current Process

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:

1. Establish performance measure with respect to customer requirements

2. Determine data needed to manage the process
3. Establish regular feedback with customers and suppliers
4. Establish measures for quality/cost/timeless of inputs and outputs.

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:

1. What problem or operation do we wish to learn about?

2. What are the data used for?
3. How many data are needed?
4. What conclusions can be drawn from the collected data?
5. What action should be taken or a result of the conclusion?

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.

Common items of data and information are:

1. Design information, such as specifications, drawings, functions, bills of materials, costs design
reviews, field data, service, and maintainability.
2. Process information, such as routing, equipment, operators, raw materials, and component
parts and supplies.
3. Statistical information, such as average, median, range, standard deviation, skewness, kurtosis,
and frequency distribution.
4. Quality information, such as, Pareto diagrams, control charts, histograms, process capability,
acceptance sampling, run charts, life testing, and operator and equipment matrix analysis.

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:

1. Examine the most likely cause against the problem statement.

2. Recheck all data that support the most likely cause.
3. Check the process when it is not by using the who, where, when, how, what, and why approach.
4. Utilize an outside authority who plays denials advocate with the data, information, and
5. Use experimental design, Taguchis quality engineering, and other advance techniques to
determine the critical factors and their levels.

Once the root, or most likely the, cause is determined, the next phase can begin.

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.

Brainstorming is a freewheeling exchange of ideas in a group setting that will

attributes to the solution of the problem. All ideas are recorded on a blackboard or similar
device. Trivial ideas are encouraged, because they may generate more productive ones.
Quantity of ideas is the objective in this session. Members of the brainstorming group are
urged to combine ideas or expand on the ideas of others. Criticism of ideas is not
permitted, because this will discourage creativity.

When possible solutions have been determined, evaluation or testing of the

solution is the next. Evaluation and/or testing determine which of the possible solutions
have the greatest potential for success and the advantages and disadvantages of these
solutions. Criteria for judging the possible solutions include such things as cost,
feasibility, effect, resistance to change, consequences, and training. Solutions may be
categorized as short range or long range.

Phase 5: Implement Changes

When the optimal solution is selected, it can now be implemented. The objective
of this phase is to prepare and implement the plan, obtain approval, and implement the
process improvements.

The contents of the Implementation plan report must fully describe, such as:

(1)Why will it be done?

(2)How will it be done?
(3)When will it be done?
(4)Who will do it?
(5)Where will it be done?
The answer to these questions will designate required actions, assign responsibility, and
establish implementation milestones. The length of the report is determined by the
complexity of the change. Simple changes may require only an oral report, whereas
others require e detailed written report.

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.

Phase 6: Pilot/ Verify Changes

Phase 6 has the objective of monitoring and evaluating the change by tracking the
effectiveness of the improvement efforts through data collection and review of progress.
It is vital to institutionalize meaningful change and ensure ongoing measurement and
evaluation efforts to achieve continuous improvement. Sometimes a pilot change is made
on small scale and, if successful, is implemented in all department areas.

The last element of the implementation plan is the monitoring activity which answers the

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.

If the team is satisfied with the change, it must be institutionalized by positive

control of the process, process certification, and operator certification.
o Positrol (Positive Control) assures that important variables are kept under control.
It specifies the what, who, how, where and when, of the process and is an
updating of the monitoring activity.
o Process certification should be made to ensure that the process will meet or
exceed customer requirements for the product or service.
o Operators must be certified to know what to do and how to do it for a particular
process. Also needed is cross training in other jobs within the process to ensure
next-customer knowledge and job rotation. Total product knowledge is also
desirable. Operator certification is an ongoing process that must periodically

Phase 7: Continuous Improvement

Phase 7 has the objective of achieving improved levels of process performance.
Irrespective of how successful initial improvement effort is, the improvement process
must continue. It is vital to remember the TQM addresses the quality of management as
well as the management of quality. Everybody in the business organization is involved in
a systematic long-term endeavor to develop processes that are customer oriented,
flexible, and responsive and to constantly improve quality.
Continuous improvement means not being satisfied with doing a good job but
striving to improve that job. It is accomplished by incorporating process measurement an
team problem solving in all work activities. TQM tools and techniques are used to
improve quality, delivery, and cost. We must continuously strive for excellence by
reducing complexity, variation, and out-of-control processes.

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.

Three Basic Principles of Kaizen

1. Work Place Effectiveness
- Japanese have developed 5S tools for addressing the work effectiveness. 5S is
management tool focused on fostering and sustaining high quality

1. Seiri (Sort) Separate out all unnecessary things and

eliminate them.
2. Seiton (Straighten) Arrange the essential things in order, so that
they can be easily accessed.
3. Seiso (Scrub) Keep machinery and working environments
4. Seiketsu (Systematized) Make cleaning and checking as a routine
5. Shitsuke (Standardize) Standardize the previous steps.

2. Elimination of waste, strain and discrepancy

- Kaizen is achieve through application of 5S tools for workplace effectiveness
and elimination of three MUs. The waste are not free, but have been paid for
by the organization, since those who produce waste also get paid and the
material wasted costs money. Therefore, one has to minimize and ultimately
eliminate the waste in an organization.
Three MUs
1. Muda Waste
2. Muri Strain
3. Mura Discrepancy
3. Standardization
- Kaizen stresses standardization of processes, materials, machinery, etc. with
the following objectives:
1. Represent the best, easiest and safest way to carry out a job in the form
of operating procedures and work instructions.
2. Represent the best way to presence know-how and expertise and
standardize the procedures for the same
3. Evolve effective means to measures performance and standardization
for the same
4. Standardize all the procedures that are used in the organization for
maintenance and improvement process
5. Standardize the training programs
6. Standardize the audit of diagnosing problems
7. Standardize the procedures for preventing occurrence of errors an
minimizing variability

Specific Incorporation in strategic plan

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

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.

Seven steps to strategic planning

There are steps in to strategic quality planning, according to John R. Drew. The process starts
with the principal that quality and customers satisfaction are the center of organization's future. It
brings together all the key stakeholders.

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?

2. Customer positioning. The planners determine where the organization wants to be in

relation to the customer. Do they want to retain, reduce, or expand the customer base?
Products or services with poor quality performance should be targeted for breakthrough
or should be eliminated. The organization needs to concentrate its efforts on areas of

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
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.

Functional strategy refers to a strategy that emphasizes on a particular functional area

of an organization. It is formulated to achieve some objectives of a business unit by
maximizing resource productivity. Sometimes functional strategy is called
departmental strategy, since each business-function is usually vested with a
department. Examples of functional strategy include production strategy, marketing
strategy, human resource strategy and financial strategy. Functional strategy is
concerned with developing distinctive competence to provide a business unit with a
competitive advantage.