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Operations Management
Kishor Chandra Das Page | i
Quality Excellence at
Rolls-Royce &
Swiss Federal Railway
Operations Management
Kishor Chandra Das Page | ii
Table of Contents
1 Introduction ................................................................................................ 1
2 Rolls-Royce Quality System ...................................................................... 1
3 SBB Passenger Traffic Quality System .................................................... 3
4 Customer Needs and Quality Process ..................................................... 4
4.1 Juran’s Trilogy vs RR-QMS & SBB QMS ................................................................ 4
4.2 Crosby’s 14 Steps vs RR-QMS & SBB QMS ............................................................ 5
5 Use of TQM and Six-Sigma in Rolls-Royce & SBB .................................. 8
5.1 Process Strategy ......................................................................................................... 8
5.2 Performance Management........................................................................................ 10
5.3 Supply Chain Management .......................................................................................11
6 Sustainability & Innovation .................................................................... 11
7 Conclusion .................................................................................................. 13
8 Appendices ................................................................................................ 14
8.1 Appendix 1 – Deming’s 14 Principles...................................................................... 14
8.2 Appendix 2 – Crosby’s 14 Steps .............................................................................. 14
8.3 Appendix 3 – Juran’s Trilogy ................................................................................... 15
8.4 Appendix 4 – Rolls-Royce Quality Targets ............................................................. 15
9 References .................................................................................................. 16
Operations Management
Kishor Chandra Das Page | 1
1 Introduction
Quality is the most important criteria to stay competitive in the market and to run a
sustainable business. Be it in service sector or in manufacturing, quality is very important to
meet the threshold of the competition and to maintain competitive advantage. This paper
discusses the applicability of the quality theories in services and manufacturing industries.
There are many theories of quality management but the top 3 theories that are regarded
most in the industry are called Deming model, Crosby model and Juran model. The Deming
model is based on the 14 principles (Appendix 1) laid and advocated by Dr W Edward
Deming. Philip B Crosby’s 14 steps (Appendix 2) to quality improvement are the basic
principles of Crosby model, which brought a significant change in quality management
practice in American companies. Dr Joseph M Juran developed the quality trilogy
(Appendix 3) of quality planning, quality control and quality improvement, which is the
basis of Juran model.
Processes of any company can be broadly categorised into 2 categories, Core Processes and
Support Processes. The core processes differ from a manufacturing organization to a service
organization and the quality approach also differs mainly due to two factors (1) nature of
output from the process (2) level of customer contact. In a service organization there is a
high level of customer contact throughout the service delivery period. This requires a
quality approach of high customer involvement and high level of process flexibility. A
customer’s contact with a manufacturing organization is primarily through the product that
the customer uses. So the quality approach in the manufacturing organization needs to be
primarily focused on the product quality and cost.
This report discusses the quality management processes in Rolls Royce, a manufacturing
company, and Swiss federal railway (SBB), a service company, and critically analyses
whether these processes are adequately designed to meet their customer needs. The next
section on this report discusses the quality approach in process strategy, performance
management and supply chain management and analyses the approach suitable for
innovation and sustainability.
2 Rolls-Royce Quality System
Rolls-Royce plc, the British engineering company, the foremost manufacturer of power
systems and services for use on land, sea and in the air. Rolls-Royce manufactures engines,
pressure vessels and turbines for transport, defence, aerospace and nuclear industries.
Because of the nature of the industry and the risks involved, quality of products and
services is a must to survive in the industry.
Rolls-Royce has 30,000 of its engines in service with its broad customer base comprising
more than 500 airlines, 4,000 corporate and utility aircraft and helicopter operators, 160
armed forces and more than 2,000 marine customers, including 50 navies. Its customers’
needs are 100% reliability, minimum downtime and optimum lifetime operating cost of the
engine fleet. To meet its customer’s needs, Rolls-Royce’s quality management system
adequately covers the quality assurance and quality control in its supply chain and
manufacturing processes. Although the RRQMS is adequate to assure quality of the
products but there have instances of lapses in adherence to quality processes. There have
Operations Management
Kishor Chandra Das Page | 2
been lawsuits against Rolls-Royce alleging the company ignored quality inspections and
safety issues at one of its factories in the US (O’Doherty, 2011). The recent incident of Trent
900 engine failure was due to a manufacturing defect in the oil feeder tube, which did cost
£56 million to Rolls-Royce to fix the problem. Some of the instances show failure in
adherence to the quality processes but to ensure that its customers don’t face any
catastrophic failures, Rolls-Royce has implemented a very innovative technology to do a
real-time monitoring of performance of its engines in service. Rolls-Royce has adopted an
in-house developed quality management system (RRQMS) to integrate business
management, product and service quality. RRQMS ensures that controls are applied
consistently in business, design, manufacturing, servicing and supply chain activities all
across the company.
Figure 1: Rolls-Royce Core Processes
The Rolls-Royce QMS is based on 8 quality management principles
1. Customer Focus
2. Leadership
3. Involvement of People
4. Process Approach
5. System Approach to Management
6. Continual Improvement
7. Factual Approach to Decision Making
8. Mutually Beneficial Supplier Relationships
The framework of the RRQMS covers all aspects of the business processes, starting with
strategic planning and leadership, supply chain management, product engineering, product
delivery and services. These above 8 principles are applied at 5 different levels in the
RRQMS. The Figure 2 below depicts the 5 different levels in RRQMS
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Kishor Chandra Das Page | 3
Figure 2 : 5 Levels of Rolls-Royce Quality Management System
3 SBB Passenger Traffic Quality System
Swiss federal railway (SBB) is regarded as the most reliable and most punctual railway
system in the world. SBB operates a 3000-kilometer network of tracks, 300 million travellers
and 60 million tons of freight is transported annually between 800 railway stations. SBB has
been consistently maintaining the track record of punctuality of its services, 95.7% of the
trains arrive within 5 minutes of delay (Weidmann et al., 2006). In order to fulfil the demand
for quality, customer satisfaction, productivity and profitability SBB implements its own
quality management system complying with the ISO9001 quality guidelines.
Figure 3: Swiss Federal Railway (SBB) Core Processes
The core operations in Passenger Traffic are Train Management, Rolling Stock Management
and Infrastructure Maintenance. SBB has 2,300 drivers to run over 6,000 trains safely,
efficiently and punctually. More than 80 planning, control, management and HR controlling
specialists ensure the correct deployment of locomotive crews. SBB also organises
locomotive crews to work special trains at short notice, as well as for managing day-to-day
business. SBB ran over 163 special trains for the affected customers due to the ash cloud
Operations Management
Kishor Chandra Das Page | 4
problem in 2010. The nature of the processes is such that it needs to be highly flexible to
accommodate for any real-time changes or emergencies.
Figure 4: Swiss Federal Railway (SBB) Train Management
The quality approach taken by SBB is an in-house developed system. Quality is ensured at
every stage form staff recruitment tests to online train management system. Despite the high
level of safety and quality assurance major accidents like the derailment in 2010 and minor
safety incidents with employees have also been reported.
4 Customer Needs and Quality Process
The primary objective of the quality process is to ensure consistency of quality that customer
needs. Processes and procedures is to defined to reduce the variability of the output
produced. This section analyses whether the quality processes at Rolls-Royce and SBB are
adequately designed to meet customer needs in comparison with the quality processes
proposed by Juran and Crosby.
4.1 Juran’s Trilogy vs RR-QMS & SBB QMS
The standards of compliance as defined in RRQMS are BS5750 (Detection of Defects or
Quality Control), ISO 9001/2/3 (Prevention of Defects or Quality Assurance and
Continuous Improvement or Quality Management). These standards of compliance are the
universal processes as defined in Juran’s quality trilogy. Juran’s trilogy does not explicitly
differentiate the quality assurance process. RRQMS defines the quality assurance as a
separate process in addition to the Juran’s trilogy. Quality planning at Rolls-Royce is done in
2 steps. The step 1 starts with planning the individual aspects of people, processes,
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Kishor Chandra Das Page | 5
materials, equipments, and resources. In the 2nd step of quality planning, a systems
approach is taken to integrate the individual aspects quality. A robust quality control
process is implemented in all steps of a product cycle, in design, manufacturing, supply
chain and services. The 2 dimensions of the quality control processes are internal quality
and external quality. The external quality control is monitored through the supplier
relationship system called SABRe. The quality of suppliers’ products is controlled through
physical verification, witness of processes, review of quality documents and records.
Quality planning in Rolls-Royce starts at top level with strategic planning to achieve quality
goals, which is a continuous improvement process. As an example, Rolls-Royce targets to
reduce the delivered defects (measured as parts per million) by 10 times in every 2 years.
The quality assurance process in Rolls-Royce is a defect prevention technique. This
prevention technique applies to external defects as well as internal defects. This process
involves short listing and certification of suppliers, plant maintenance, process monitoring,
technology upgrades, etc.
Juran’s Trilogy RR QMS SBB QMS
Quality Planning Quality targets are clearly
defined and reviewed every 2
years.
Performance targets are
agreed with government and
reviewed every 4 years.
Quality Control Inspection and verification
processes are in place to control
product quality.
Total quality assurance is
ensured at every stage in the
supply chain from
procurement, manufacturing
and engine testing.
Service quality monitoring is
done from the punctuality
and safety records and
customer feedback.
Employee training and
infrastructure maintenance
carried out to prevent errors
and customer dissatisfaction.
Quality Improvement Real-time engine performance
is monitored to detect engine
problems at early stages and
bring design improvements.
Projects undertaken to
improve the punctuality,
safety and customer
experience.
4.2 Crosby’s 14 Steps vs RR-QMS & SBB QMS
The Rolls-Royce QMS derives many of its principles from the Crosby’s 14 steps to quality.
The table 1 below draws a comparison of Crosby’s 14 steps and the equivalent processes in
Rolls-Royce QMS.
Crosby’s 14 Steps Rolls-Royce QMS SBB QMS
Step 1: Management
Commitment
The 2nd principle of Rolls-Royce
QMS is about leadership, which
has a direct correlation to the step
1 in Crosby’s 14 steps. There is a
formalised quality policy and
targets. Management’s
commitment is evidenced from
ISO 9001 compliance and
allocated budgets and
undertaken quality
improvement projects are
evidence of management
commitment.
Operations Management
Kishor Chandra Das Page | 6
the budgets allocated for plant
and technology improvements to
achieve the quality targets
(Appendix 4).
Step 2: Quality
Improvement Team
Rolls-Royce has quality
improvement teams comprising
participants from its suppliers,
employees from different
departments and customer
representatives drawing the
improvement plan and
monitoring the improvements all
thought out its supply chain and
delivery.
Quality compliance team
identifies the quality gaps and
improvement opportunities. It
is SBB’s internal team unlike
the team at Rolls-Royce.
Step 3: Quality
Measurement
The principles of process
approach and factual approach to
decision making derives this step
of quality measurement. Product
verification thorough automated
co-ordinate measuring machines
(CMM) tracks and monitors the
defects. Statistical process control
in the supply chain and
manufacturing line monitors the
current and potential problems.
Real-time onboard tools (as
shown in Figure 4) are used
for measuring service quality
and regular customer
feedback is collected to check
customer perspective of
quality of service.
Step 4: Cost of
Quality Evaluation
The principles of factual
approach to decision making and
systems approach to
management are implemented
through the processes of
measuring waste and potential
losses due to damage to the
reputation. Crosby’s step 4 is all
about measuring waste and using
it a tool for decision making.
SBB QMS does not have
provision for measuring cost
of quality.
Measuring cost of quality in a
service sector can be very
complex and difficult to
measure.
Step 5: Quality
Awareness
Employee trainings, internal and
external audits are examples in
Rolls-Royce that implements this
step 5 from Crosby’s 14 steps.
New and existing employees
are regularly trained on
various aspects of customer
interaction, safety and service
standards.
Step 6: Corrective
Action
Planned and ad-hoc plant
maintenance takes the corrective
action needed in its
manufacturing line.
Maintenance is one of the core
processes in SBB to ensure
quality of service.
Step 7: Establish an There is no direct evidence of ad- There is no evidence of SBB
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Kishor Chandra Das Page | 7
Ad Hoc Committee
for the Zero Defects
Program
hoc committee and zero-defects
program process in RR-QMS. But
Rolls-Royce hosts a variety of
events to celebrate the excellence
and achievements in quality.
following step 7 as defined in
Crosby’s model.
Step 8: Supervisor
Training
Employees and Supervisors go
through cross skills trainings to
develop flexibility in workforce.
Through trainings and
restructuring Rolls-Royce has
been able to achieve 10% higher
output per operator (Llyod,
2003).
Trainings as described in step
4.
Step 9: Zero Defects
Day
There is no direct evidence of
celebrating zero-defects day in
RR-QMS. But Rolls-Royce hosts a
variety of events to celebrate the
excellence and achievements in
quality.
SBB does not follow a zero
defects day.
Step 10: Goal Setting Continuous improvement quality
targets drives innovation and
process improvement in Rolls-
Royce (Appendix 4)
Service agreements with Swiss
government and rail
companies.
Step 11: Error Cause
Removal
Monitoring the performance of its
engines through the EHM
(Engine Health Monitoring)
system helps in identifying
potential design problems and
fixing them before engines reach
to the fatigue stage.
Any reported incident in the
service disruption is
investigated by a panel of
experts to identify the error
cause and actions are taken to
remove the error cause.
Step 12: Recognition Rolls-Royce recognises and
rewards its suppliers and
employees every year through
award ceremonies. The principle
of employee involvement and
mutually beneficial supplier
relationship are behind the
process of recognising and
rewarding employees and
suppliers.
Various employee awards and
team awards distributed
annually to recognise the
innovation and improvements
brought by high performers.
Step 13: Quality
Councils
Quality improvement
information is shared across all
departments but RR-QMS does
not directly address
establishment of quality councils
SBB quality management
system does not have
provision for quality councils.
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Kishor Chandra Das Page | 8
within the organisation for the
purpose of sharing quality
improvement information.
Step 14: Do It Over
Again
The principle of continuous
improvement and quality targets,
technology and process
improvements establishes this
14th step in Rolls-Royce.
Incremental improvements
and regular projects
undertaken to repeat the cycle
of quality improvements.
5 Use of TQM and Six-Sigma in Rolls-Royce & SBB
The philosophy of TQM is implemented in most of today’s organisations but also it is
misinterpreted very often. TQM is a culture of managing to improve the effectiveness,
flexibility, competitiveness of an organisation. Quality has always been at the forefront for
Rolls Royce and it started adopting the principles of TQM in the year 1979 (Martínez-
Lorente et al., 2000) and in the 100 year old history of SBB, achieving service excellence has
always been in the blood of the business. TQM principles are based on three things (i)
Customer Satisfaction (ii) Employee Satisfaction and (iii) Continuous Improvement, where
as Six-Sigma is about variability of any process output. The three levels of Six Sigma
implementation are (i) As a Metric (ii) As a Methodology (iii) As a Management System. Six
Sigma underpins the TQM principles, Statistical Process Control and the other principles of
quality management. Rolls Royce has a robust and mature Six Sigma program. Roll-Royce's
improvement journey to performance excellence has the broad leadership support
throughout the company to ensure true cultural change to embrace quality throughout the
production and delivery process to please Rolls-Royce customers (Dave, 2011). Six Sigma’s
emphasis on defects measurement makes it relevant for manufacturing industry where the
process steps are well defined and repetitive and defects can be measured. Measuring
defects in a service process can be illogical to assume that all defects are equal. Though SBB
does not implement the statistical definition of Six Sigma, which is 3.4 defects per million
opportunities, it implements the core principles of continuous improvement for growth and
productivity.
5.1 Process Strategy
Process based approaches and process based management are helping organizations
improve and gain a competitive advantage. The process strategy at Rolls Royce is primarily
focused on the repetitive nature of the assembly line work and testing of the assembled
engines where as the process strategy at SBB is focused on the process flexibility to make the
customer experience delightful while availing its services at the railway stations or the
onboard services. There are some many sub processes within these organizations which
follow the product focus strategy and mass production strategy.
Continuous improvement at Rolls Royce is essential to meet the increasing expectations of
its customers and to maintain competitiveness. Rolls Royce uses consistent methods for
improvement, which include Define Measure Analyze Improve Control (DMAIC).
Embarking on a Six Sigma program means delivering top-quality service and products
while virtually eliminating all internal inefficiencies. The process strategy at Rolls Royce is
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Kishor Chandra Das Page | 9
aimed at achieving the goal of 40 day engine delivery through process optimization and
efficient production. Each engine series is a different product but the new engine
development follows a similar cycle. The core engine common technology is the same for all
engines. The process strategy for the core engine constituent components is mass
production focused to gain reduced costs that are achievable from volumes. The Figure 5
below shows the 4 elements for achieving process excellence at Rolls Royce.
Figure 5: Rolls-Royce Process Maturity Cycle
The Six Sigma program at Rolls Royce has been able to achieve
95%+ component delivery performance. Customer delays are a rare event.
Less inventory and improved stock turns through the ERP system that has enabled Rolls
Royce to shorten component manufacturing lead times.
The capacity and load mismatch has dropped by a factor of ten over recent years,
leading to not only easier planning but also a reduction in indirect labour and hence
costs.
Improvement on engine lead time from 473 days to 40 days
(Llyod, 2003)
Although SBB never publicised its quality management and process strategy practices as Six
Sigma or TQM program but core principles and philosophies are inherent in its corporate
culture. The principles of TQM and Kaizen are more prevalent in SBB than the Six Sigma
approach. Some of the recent projects undertaken by SBB underpin their belief in TQM.
The Dynamic Railroad Traffic Management program is designed to increase operational
efficiency, network capacity and stability in heavily used mixed traffic networks while
minimizing the cost of new infrastructure. Every train always has an up-to-date, conflict
free schedule with an accuracy of seconds (Weidmann et al., 2006).
In order to fulfil demands relating to quality, customer safety and satisfaction,
Operations Management
Kishor Chandra Das Page | 10
productivity and profitability, the SBB implemented the Netbook mobile computing
project. This project replaced approximately 40 tons of paper daily, and has enabled SBB
to greatly reduce the preparation time necessary for Locomotive Crews prior to the start
of a trip, thus enabling a more effective and efficient use of their time. The philosophies
of TQM, customer satisfaction, employee engagement and continuous improvement, are
well adopted in this project.
The Taktfahrplan ("clockface timetable") project greatly in 1982 improved the connection
time at hub stations reducing the travel time for customers.
The Rail2000 project, an ambitious programme to improve the company's services, was
put into effect. It was the greatest timetable change since the introduction of the
Taktfahrplan
There are few projects that have resemblance to the Six Sigma methodology, e.g the safety
performance improvement project done by partnering with DuPont in 1993. The project
reduced the safety related incidents from 4,255 in 1993 to 2,220 by 1997 saving SBB CHF 6.6
million. DuPont is one of the early adopter of Six Sigma models and their experience in Six
Sigma projects helped SBB on this project. The Six Sigma culture is not very prevalent in SBB
for process strategy. Adopting Six Sigma methodology and culture would greatly enhance
the process strategy and measurement of process improvements and accuracy at SBB.
5.2 Performance Management
Performance management is all about execution, putting strategy to work (Horn, 2006). Be it
business performance or individual performance, a balanced scorecard monitors results and
identifies any areas for improvement. Performance management requires two elements as
inputs (a) strategic objectives and performance indicators (b) current and actual
performance against targets. Balanced scorecard has been in use for 2 decades and has
proven to be a useful tool for management to develop strategy and monitor progress.
Implementation, usefulness and accuracy of balanced scorecard at grass root level have been
questioned for practicality (Gupta, 2004).
Figure 6: Six Sigma Business Scorecard by Praveen Gupta
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Kishor Chandra Das Page | 11
Rolls Royce has standard performance measures in every plant. The Key Performance
Indicators are focused on Quality Cost and Delivery. The same measures are used in every
cell, plant, business units and to the Rolls-Royce Board (Llyod, 2003). In a service industry
the key performance indicator is customer satisfaction. Swiss Federal Railway’s performance
indicators are customer satisfaction, safety, punctuality and environmental impact. Rolls
Royce and SBB have their respective performance scorecards defined and monitored
adopting the DMAIC methodology of Six-Sigma. All businesses, manufacturing and
services sector, need a tool that can provide a framework for energise the workforce and
continually improve the individual and organizational performance. For any Six Sigma
scorecard to be implemented successfully it must be built upon the basics of business. The
Six Sigma scorecard personifies leadership and management; aligns operations and drives
customer service and sales; and promotes employee excellence and innovation(Gupta, 2004).
5.3 Supply Chain Management
Supply chain management is becoming very important for the companies to stay ahead of
the competition. From the early 90s Six Sigma methodologies have been used to achieve
substantial improvement in the supply chain quality. Managing supply chain Six Sigma
projects is a very challenging as not only the direct suppliers but the supplier’s suppliers are
also required to be involved in the projects. GE, DuPont, Honeywell, Samsung, all these
companies have been able to gain their competitive advantage through their Six Sigma
projects. Samsung modified DMADOV framework to DMAEV by introducing the “Enable”
stage in place of Design and Optimise for their Six-Sigma supply chain projects.
The programme launched in 2003 at Rolls Royce aimed at simplifying the supply chain by
embarking on a process of “integrating” components into logical kits. This programme
greatly eliminated waste, reduced number of suppliers from 600 to 300 and enabled just in
time supply chain management. The Trent 500 engine is a good example of this Six Sigma
project, which uses 11,000 components covering 1,800 different parts. The kit now contains
30 logical packages requiring less space and cleaner floor halving the lead time and
requiring 1/7th of inventory in assembly line.
6 Sustainability & Innovation
As the environment is becoming more and more competitive, innovation is no more a
differentiation, but a necessity, and as consumers’ expectations on CSR are increasing,
finding the balance between these variables is most likely to define how successful the
company is (Yamasaki, 2011). The only way to sustain business in today’s dynamic and
competitive environment is through continuous innovation. There are many empirical
evidences where the market leaders have lost their competitive advantage due to lack of
continuous innovation, e.g the Japanese DRAM industry lost its market position to the
Korean industry. Innovations can be radical or incremental and both are essential to stay
ahead of the competition. The internet protocol TCP/IP was a radical innovation but in the
early years of this innovation it was nowhere close to the quality benchmarks of telephony,
the subsequent incremental innovations made it a sustainable technology. The Six Sigma
approach has been very successful in generating incremental innovative ideas and projects.
On the other hand companies like SBB, who don’t follow the Six Sigma approach, are also
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Kishor Chandra Das Page | 12
very successful in sustaining their business. Cost-effectiveness, environmental compatibility
and social responsibility are the three central pillars of SBB’s corporate strategy oriented
towards sustainability. Tourism industry plays a significant role in Switzerland’s economy
and nature and the environment play a significant role in growth of the tourism industry in
Switzerland. So sustainability of SBB cannot be achieved without taking care of the
environment in its strategy and actions. In recent years SBB has started energy saving and
climate protection programmes, which are continuous and ongoing. Sustainability in
manufacturing industry also cannot be achieved without taking care of the environmental
impact. The CO2 emission per passenger for a flight journey is 10 times higher than a train
journey. The Rolls Royce group measures both the emissions of its products and the
emissions of its manufacturing operations. As a power systems company Rolls-Royce’s
primary contribution to sustainability is to develop technologies and products with an
increasingly lower environmental impact. Rolls-Royce’s R&D investments are for
developing products for future to respond to several of the major environmental challenges,
through the provision of low-emissions, low-carbon and renewable energy solutions.
Radical innovations and future products build the foundation for long term sustainability.
Rolls-Royce’s tidal stream generator is such an example of radical innovation in renewable
energy sector.
Quality philosophies like Six Sigma and TQM can develop an organizational culture for
incremental innovations. Japanese car industry and technology industry gained its
competitive advantage through their quality
initiatives and incremental innovations. But in a
study conducted by Benner and Tushman in the
paint and photography industries shows that the
greater the number of ISO certifications, the fewer
the number of original patents. The risk averse
nature of quality process stops free thinking and
risk taking. For generating new ideas it requires a
free thinking environment. The creative workplace
at Google allows being yourself. Rolls-Royce’s
research wing employs creative and free thinking
professionals to develop products for future. It invested a total of £923 million in its research
and development activities. Research and development are fundamental to future success,
providing technologies and intellectual property that allows competing on a global basis in
highly competitive markets. Six Sigma culture of quality improvement and cost reduction,
with its rigorous analysis, constricts choice, and as such does not mesh well with the more
freethinking and risk-taking culture required for germinating new ideas (Cole &
Matsumiya, 2007).
The recommendation for Rolls-Royce is to continue with their TQM and Six Sigma
implementation in their established production process and supply chain process and invest
more in developing sustainable renewable energy products. SBB must continue with their
focus on making it a delightful experience for their customers and adopt the Six Sigma
principles to bring measurable, continuous and incremental innovations. Six Sigma trainings
for employees and a focus on measurable incremental improvements can help SBB attaining
higher quality goals.
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7 Conclusion
The quality approach in an organization is driven by the level of customer involvement. In
manufacturing sector the process strategy is primarily product and mass production
focused whereas in service sector it is focused on process and flexibility of processes. Rolls-
Royce follows a dual strategy with product focus and mass production focus. Rolls-Royce
has a deep rooted culture of product excellence by adopting the principles of TQM and Six
Sigma. SBB follows its own quality principles of delightful customer experience and
continuous improvement, which has very close resemblance to the TQM principles. The
principles laid out by the quality gurus like Juran, Crosby and Deming have a very common
foundation which are applicable for manufacturing as well as service industries, Rolls-
Royce and SBB both follow these quality principles in their quality management system.
Analysis of the supplier relationship process at Rolls-Royce and the Train management
process at SBB shows that processes are designed keeping customer needs in view. But in
both organisations there are quality lapses observed in some instances. To prevent these
quality lapses and to improve on the observed quality gaps, it requires a process of
continuous improvement. The quality philosophies like Six Sigma and TQM, both address
the need for continuous improvement and build a culture of excellence. Rolls-Royce and
SBB, both have their own balanced performance scorecard and they are measured and
monitored against those scorecards.
Quality approach can help organizations to bring incremental innovations and stay
competitive with their competitors. Six Sigma approach can be applied to any of the core
processes or the support processes to bring incremental improvements, reducing cost and
increasing profitability. But researches and empirical evidences suggest that these quality
approaches develop risk averse culture in organisations and stops them taking risks. For
companies to stay ahead of the competition, sustainable and continuous radical innovations
are required. To bring the radical innovations forward it requires a free thinking culture,
which is beyond boundaries of quality and processes. Rolls-Royce spends huge money in its
research and development for developing sustainable products for future. SBB spends huge
money in its futuristic projects for making the Swiss and European railway services
sustainable making less impact to the nature and environment. The new products and
services from radical innovative thinking may lack the stability of quality of an established
product but the follow-up incremental innovations and quality improvements will make the
new products sustainable for future.
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Kishor Chandra Das Page | 14
8 Appendices
8.1 Appendix 1 – Deming’s 14 Principles 1. Create constancy of purpose toward improvement of product and service, with the
aim to become competitive and to stay in business, and to provide jobs.
2. Adopt the new philosophy. We are in a new economic age. Western management must
awaken to the challenge, must learn their responsibilities, and take on leadership for
change.
3. Cease dependence on inspection to achieve quality. Eliminate the need for inspection
on a mass basis by building quality into the product in the first place.
4. End the practice of awarding business on the basis of price tag. Instead, minimise total
cost. Move towards a single supplier for any one item, on a long-term relationship of
loyalty and trust.
5. Improve constantly and forever the system of production and service, to improve
quality and productivity, and thus constantly decrease costs.
6. Institute training on the job.
7. Institute leadership. The aim of supervision should be to help people and machines
and gadgets to do a better job. Supervision of management is in need of an overhaul,
as well as supervision of production workers.
8. Drive out fear, so that everyone may work effectively for the company.
9. Break down barriers between departments. People in research, design, sales, and
production must work as a team, to foresee problems of production and in use that
may be encountered with the product or service.
10. Eliminate slogans, exhortations, and targets for the workforce asking for zero defects
and new levels of productivity. Such exhortations only create adversarial relationships,
as the bulk of the causes of low quality and low productivity belong to the system and
thus lie beyond the power of the work force.
11. a) Eliminate work standards (quotas) on the factory floor. Substitute leadership.
b) Eliminate management by objective. Eliminate management by numbers, numerical
goals. Substitute leadership.
12. a) Remove barriers that rob the hourly paid worker of his right to pride in
workmanship. The responsibility of supervisors must be changed from sheer numbers
to quality.
b) Remove barriers that rob people in management and engineering of their right to
pride in workmanship. This means, inter alia, abolishment of the annual or merit
rating and management by objective.
13. Institute a vigorous program of education and self-improvement.
14. Put everybody in the company to work to accomplish the transformation. The
transformation is everybody's job.
8.2 Appendix 2 – Crosby’s 14 Steps
Step 1: Management Commitment
Step 2: Quality Improvement Team
Step 3: Quality Measurement
Operations Management
Kishor Chandra Das Page | 15
Step 4: Cost of Quality Evaluation
Step 5: Quality Awareness
Step 6: Corrective Action
Step 7: Establish an Ad Hoc Committee for the Zero Defects Program
Step 8: Supervisor Training
Step 9: Zero Defects Day
Step 10: Goal Setting
Step 11: Error Cause Removal
Step 12: Recognition
Step 13: Quality Councils
Step 14: Do It Over Again
8.3 Appendix 3 – Juran’s Trilogy
The concept of the quality trilogy is that managing for quality consists of three basic quality-
oriented processes.
Quality planning.
Quality control.
Quality improvement.
8.4 Appendix 4 – Rolls-Royce Quality Targets
Targets for continuous improvement are:
• Halve the rate of customer incidents every 3 years.
• Halve the cost of non-conformance from all business processes every 3 years.
• Ten times reduction in delivered defects every 2 years, measured as parts per million
(PPM) or defects per unit (DPU) as appropriate.
• Set benchmark lead times and achieve them including appropriate intermediate mile-
stones within 3 years.
Operations Management
Kishor Chandra Das Page | 16
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