CQI Certificate: Using Quality to Improve

Business Performance UnIt 305

Element 3: Philosophies and Methodologies of Continual ImprovementSaMPlE MatErIal

(Material correct Summer 2013)

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Element 3: Philosophies and Methodologies of Continual Improvement

© RRC Training CQI Certificate Unit 305 – Element 3 | 3-1

• Joseph Juran, a key thinker in the field of quality management, pioneered the ‘project-by-project’ approach to quality improvement; he suggested both a project structure and a 10-step sequence to achieve quality improvement.

• Juran stressed that all employees participating in project teams need to develop skills in such matters as team participation, problem-solving tools/techniques, etc. This is because project teams need to base all decision making on both understanding and data of a factual nature.

The ‘Project-by-Project’ Approach

This element examines a selection of philosophies and methodologies associated with the process of continual improvement. The content looks at more over-arching concepts that are commonly used by organisations to provide a framework within which continual improvement can flourish.

Defining where exactly the boundaries lie between a continual improvement philosophy and a methodology often seems somewhat vague in practice, interpretation and applications being subject to much variation. Nevertheless, all the frameworks examined below provide a roadmap to improvement, utilising any number of proven analysis tools and methods – these will be discussed within different elements of this course.

The Project-by-Project Improvement ProcessJoseph M. Juran (1904-2008) was one of the key American gurus and made many contributions to the field of quality management. During his substantive career Juran progressively developed ideas for shaping organisational quality, including:

• Top management involvement.

• Popularisation of the Pareto Principle.

• The need for company-wide training in quality.

• Defined quality as ‘fitness for use’ with five required attributes as quality of design, quality of conformance, availability, safety and field use.

• The project-by-project approach to quality improvement.

Pareto Principle

The Pareto Principle – also known as the 80:20 Rule, is a theory that argues that 20% of any entity is responsible for 80% of its results. For example, 20% of the causes of a process problem are responsible for 80% of the non-conformities. Using this technique allows the ‘vital few’ to be separated from the ‘trivial many’. As a consequence, priority can be given to those problems that will have a meaningful, positive impact when addressed.

Joseph M. Juran is another key contributor to the subject of quality management. Read more about this key quality ‘guru’ by visiting: http://www.jmjuran.com/biography.htm.

Juran argued that quality is achieved within an organisation via a strategic and structured approach. He further stated that “all improvement takes place project by project, and in no other way”. Also, when adopting this approach it’s important to select projects carefully and apply higher quality where it makes sense.

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Element 3: Philosophies and Methodologies of Continual Improvement

CQI Certificate Unit 305 – Element 3 | 3-2 © RRC Training

Within the project-by-project approach for quality improvement implementation it is recommended that two kinds of teams are formed – see figure below:

• Steering committee:

– Consists of management.

– Obtains project nominations from all employees.

– Selects current year’s projects.

– Appoints individual project teams.

• Project teams to work on analysing problems, developing and implementing solutions.

Steering

Committee

Project

Team 1

Project

Team 2

Project

Team 3

Project-by-Project Team Structure

10-Step Sequence to Quality Improvement

Juran provided the following 10-step sequence for the project-by-project guide to quality improvement:

1. Create awareness of the need and opportunity for improvement.

2. Set goals for improvement using cross-functional sources.

3. Organise to reach goals.

4. Provide training.

5. Carry out projects to solve problems.

6. Communicate progress of improvement projects.

7. Give recognition to people contributing towards quality improvement.

8. Communicate results.

9. Measure the progress of improving quality against defined targets.

10. Integrate improvement into the organisation’s systems.

(Continued)

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Element 3: Philosophies and Methodologies of Continual Improvement

© RRC Training CQI Certificate Unit 305 – Element 3 | 3-3

The project-by-project structure can potentially lead to many project teams being formed within the business. Irrespective of how many teams are formed, however, Juran (consistent with other quality gurus of the time) was insistent that continual improvement could only be successfully achieved via knowledge. It is therefore essential that all participating project team members develop skills in such matters as team participation, problem-solving tools/techniques, etc.

This knowledge is absolutely vital as the main purpose of the project teams is to solve problems. The associated decision making to achieve this must be based on both understanding and data of a factual nature.

Juran was also very keen for project teams to focus on addressing the root causes of problems as opposed to merely addressing symptoms. He described this process as “the journey from symptom to cause”. The symptom is merely an indication that something is wrong with a process, the root cause often being something completely different in nature.

Juran puts much emphasis on organisations prioritising their problems for improvement and he duly popularised the Pareto concept within industrial environments. Later in this course the Pareto Principle is discussed in detail. This principle is useful to assist organisations in their prioritisation of improvement projects by differentiating between the vital few and the trivial many. Expressed in other words, Pareto states that a few factors account for the largest percentage of a total.

The Pareto Principle referred to within this element is a very important technique in achieving process improvement. We will cover this technique later but to get a quick overview of this principle visit: http://www.pinnicle.com/Articles/Pareto_Principle/pareto_principle.html.

Revision Question

1. Using a simple sketched diagram, draw Juran’s recommended structure for achieving a project-by-project approach. Briefly explain the main objectives for each group of people identified within your diagram.

(Suggested Answer is at the end of the unit.)

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Element 3: Philosophies and Methodologies of Continual Improvement

CQI Certificate Unit 305 – Element 3 | 3-4 © RRC Training

• The Kaizen philosophy for continual improvement is focused on small step changes that involve all employees within the business.

• Kaizen projects will usually follow six clearly defined stages.

• The business culture necessary for sustained Kaizen success needs to emanate from senior management who need to slowly embed the Kaizen principles and beliefs within the rest of the organisation.

Kaizen

The Kaizen philosophy involves everyone in an organisation working together to make improvements, and may be viewed as a culture of sustained continuous improvement focusing on eliminating waste in all the systems and processes of an organisation.

Kaizen

Japanese word meaning gradual and orderly, continuous improvement. ‘Kai’ means ‘change’, and ‘Zen’ means ‘good’.

Kaizen requires involved leadership, capable of guiding people to continuously improve their ability to meet expectations of high quality, low cost, and on-time delivery. Through the improvement of the quality of work during every stage, from concept to product design, manufacture to sales and marketing and after service, it is possible to dramatically reduce the cost of operations while improving quality.

The philosophy of Kaizen considers that “Quality begins with the customer”.

• Customers increasingly want better quality products at a lower price. This has historically proven a problem for organisations which must stay profitable in order to satisfy their customers, employees, shareholders and management.

• Organisations are now required to establish internal systems which can assure quality, manage cost and deliver the products in time for the customers.

• In addition to accredited management systems, organisations increasingly try to manage and reduce the cost of operations and employ their resources more efficiently.

• Kaizen is dedicated to continuous improvement in small increments, at all levels, forever.

Everyone in the organisation can contribute to the Kaizen process. The roles of organisational personnel are:

• Senior/Executive Management

Senior Management are responsible for:

– Establishing Kaizen as a corporate strategy.

– Communicating their commitment to the workforce at all levels in the organisation.

Senior/Executive Management should ensure that:

– Adequate resources are allocated for Kaizen to work.

– Policies, systems and procedures which are developed carry executive authority.

• Middle Management

Middle managers are responsible for actually implementing the policies of Kaizen established by Senior/Executive management. They ensure that employees receive adequate training to implement and understand Kaizen, and establish, maintain and improve work standards.

• Supervisors

Supervisors apply Kaizen at the functional level. They provide coaching for teamwork activities, facilitating and making Kaizen suggestions.

• Employees

Employees should all participate in Kaizen, either through the teamwork or improvement activities or by undertaking necessary training, or education. Employees should be encouraged to make or consider Kaizen suggestions, and engage in continuous self-improvement activities.

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Element 3: Philosophies and Methodologies of Continual Improvement

© RRC Training CQI Certificate Unit 305 – Element 3 | 3-5

The Stages of Kaizen Philosophy

The following stages are usually followed for implementing a Kaizen project:

1. Standardise – this means standardising current operational processes, i.e. make sure everyone is being consistent with the same process; this task needs to be done right at the outset of any Kaizen improvement cycle.

2. Measure existing operational performance levels.

3. Establish desired improvement targets, comparing existing measurements to these targets within the Kaizen plan. Typical areas for improvement might be related to the following:

– Operator’s own work.

– Machines and processes.

– Improvements in office work.

– Improvements in product quality.

– Resources, e.g. energy, material, etc.

– Working environment.

Priority lists need to be established together with a required resource plan, e.g. estimated operator time required to achieve the tasks; from an operator point of view, the longer an improvement activity takes, the more frustrating it becomes for everyone involved. It is often necessary, therefore, to plan improvement via small, achievable steps that keep people’s enthusiasm high.

4. Develop innovative solutions to meet the Kaizen target.

5. Implement, and then subsequently standardise, the new improved processes/operations.

6. Continue improvement cycle again and again.

(Continued)

A Kaizen culture is not simple to apply or indeed sustain. It needs to initially emanate from senior management who need to slowly embed the Kaizen principles and beliefs within the rest of the organisation.

Often, the main barriers to Kaizen success include:

• Inter-departmental or functional resistance.

• Lack of available cash to implement improvements.

• Management political power concerns.

Despite the difficulties outlined above, Kaizen can provide a very effective framework to foster continuous improvement within an organisation.

Revision Question

2. Outline the stages involved in a typical Kaizen improvement project.

(Suggested Answer is at the end of the unit.)

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