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QUALITATIVE ANALYSIS ON PROCESS CHANGE (REENGINEERING)

METHODOLOGY IN MALAYSIAN MANUFACTURING COMPANIES

Authors:

Hartini AhmadJohari JalilSiti Norezam Othman

College of Business,

Universiti Utara Malaysia,06010 Sintok, Kedah.

hartini@uum.edu.my

AbstractIn volatile environment, manufacturing companies attempt to implement process

change to get a sustainable competitive advantage. This study has identifiedprocess change methodology considered by them to enable successful change. This

paper focuses on a case study approach based on semi-structured interviews withmanagers in a major semiconductor manufacturer. The paper concludes that

process change methodologies are unique based on the project natures.Furthermore, it also has to be systematic and comprehensive by undertaking a

process-based approach across functions. The paper bridges studies on the use ofone particular method in isolation by provide the necessary depth, based on

practical experience. Through this research, recommendations for process changemethodology to the organisations to embark on radical process change are

provided.

IntroductionThe dynamics of the markets is rapid and fast changing technology,

complexity and uncertainty about its future need the manufacturing companies tobecome more proactive in dealing with these. Previous studies had recommended

the implementation of new approaches, new methods, and new ways of doingthings to compete in the business environment and are prone to serious

change(Grover, Kettinger and Teng 2000; Gaafar and Shoukry 2003; Shapiro2008). Many researchers have argued that incremental change is no longer

appropriate given the dynamics of the current competitive environment. In orderfor the firms to survive, they have to do changes in more radical way(Burlton

2001), such as restructuring Hafsi and Thomas (2005).

Fernandez and Rainey (2006) identified the need of the pragmatic approach inlarge scale change in order to ensure the desired outcomes. The research stressed

mailto:hartini@uum.edu.mymailto:hartini@uum.edu.mymailto:hartini@uum.edu.my

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on the leader capability to master the challenges of leading change. Therefore, theaccomplishment of radical process change needs proper methodology to ensure

that the effort is not a waste, since radical process change involves costs(Ahmad,Francis, and Zairi 2007).BPR, has been seen as one of the many ways to

achieve business objectives. Wu (2003) identified that there are an increasing

number of firms, which decided to adopt BPR as the primary vehicle for theirorganisational transformation. The concept of BPR is critical to current competingbusiness environment, which integrate the needs to satisfy customers (Ahmad et

al., 2007). Most of the previous studies concentrated on the implementation ofBPR in manufacturing have not yet found a consensus on the reality of BPR

experiences in terms of its methodology. As another example, Al-Mashari, Iraniand Zairi (2001), McAdam(2003) and McAdam and Bickerstaff (2001)

investigated a change effort in the manufacturing sector. They highlighted thatthere were pressures for changes in the manufacturing processes, which resulted

from the need for more lean production.Through the investigation on the publishedcase studies and empirical research, it is understood that radical process change

has been implemented widely in manufacturing settings in many developedcountry.

Whether it is reengineering, restructuring or whatever other reorganization

program, the aim is almost always to initiate or promote the required changeprocesses in the company (Pfeifer, Voigt, and Robert, 2005). However, there is no

single standard methodology which is suggested to be followed by anyorganisation, which Stoddard, Javenpaa and LittleJohn (1996) highlighted the

deviation between the theories on research design and the actual implementation ofradical process change in selected companies. They stressed the differences in

methods for organisations that have accomplished radical process changesuccessfully. With a failure rate of up to 70%, the implementation phase was

always seen to be the most difficult phase of a change management program(Kamhawi, 2008: Lilie, 2002). In other words, it is not so much the right strategy

but the effective implementation of the right strategy which is decisive forbusiness success. Although there are efforts for developing a general framework

for radical process change (Ahmad et al., 2007; Valiris and Glykas 1999), there arestill no consensus on the one single method. Radical changes involve streamlining,

reorganizing, and integrating activities to create new ways of working to support aprocess management orientation (Johnston, Fitzgerald, Markou & Brignall, 2001),

which the methodology should be recognised.

Therefore, the primary aim of this paper is to discover the process changemethodology embarked bya single manufacturing entity.

Literature ReviewOne of the popular radical change approaches is reengineering, which is

described as the rethinking of business process to increase organizational

effectiveness (Hammer, 1996). Business processes, not functions, become thefocus of attention. Business processes, the manner in which works get done within

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an organization are both distinguishing characteristics and a factor for competitiveadvantage among organizations (Al-Mashari & Zairi, 2000). It came to realize that

the old ways of operating, the existing tools used to accomplish goals, were nolonger adequate. A radical process change, interchangeably used in this paper as

BPR was originally popularised by Hammer and Champy (1993) and Davenport

(1993a,b). Since they are various other names, which similar to it, such as processinnovation, business process redesign, business process management, businessprocess benchmarking, and core process redesign, the need is understand its

distinguishing attributes(Davenport 1993a). To build further understanding on thisconcept, BPR is seen as a horizontal flow of activities, concerned to eliminate non-

value added activities (Bhatt 2000), which operate boundary-less to enable theorganisation to undertake faster decision-making. Original definition by Hammer

and Champy (1993), BPR as, the fundamental rethinking and radical redesignof business processes to achieve dramatic improvements in critical, contemporary

measures of performance such as cost, quality, service and speed.

BPR is one approach for rapid change and dramatic improvement, andemphasises the clean slate perspective to enable the organisation to focus on a new

process. The clean slate approach mean a totally creation of a new process and notmerely a modification of existing process. The starting point for reengineering is a

blank sheet of paper. The anticipated outcomes are dramatic and rapidimprovements in performance. BPR thus seeks to dismiss the history and context

of the organisation, to build it again from scratch or simply stated by theresearcher as blank sheet - fresh start. Unfortunately, BPR implementations have

not been as successful as organizations would like with a failure of 50-70% of thetime (e.g. Kamhawi, 2008; Lilie, 2002). This high incidence of failure demands

investigating different aspects of BPR projects implementation. One important

aspect of them was the social context of implementing BPR. An area of muchconcern associated with that has been the ambiguity of senior managers behaviortowards adopting BPR. What appears to be missing is an examination of the

possible underlying reasons or factors that influence senior managers perceptionsconcerning adopting BPR. There has been relatively little research on this topic

(Kamhawi, 2008).

Valiris and Glykas (1999) suggested a BPR methodology called AgentRelationship Morphism Analysis (ARMA) that goes beyond the limitation of BPR

methodologies, taking a holistic view of the organisation, with the use of three

perspectives: the structural, behavioural and process. Although this study tookinto consideration the people, which much BPR did not, as claimed by Dean(2000), the need for a more holistic approach is still viewed as important, which

covers all aspects comprehensively.Other process change methodologies that havegained confidence are methodologies linked to Six Sigma (Harvey, 2004). The

first methodology is the define, measure, analyze, improve, and control (DMAIC)where process capability is attained as the focus of improvement is known. The

second methodology is define, measure analyze, design and validate (DMADV)

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which is best for designing or redesigning a new service or process. Finally, thethird methodology is Design for Six Sigma (DFSS) where product is designed

based upon the requirement of process capability and the interaction and they needto be understood statistically.

According to Janbring (2002) in manufacturing, there are many low-performance organisations that are consequences of waste of time, money andresources. This shows a basic lack of competence in the area of operation

management and the need for competency regarding improvement of performance.Grumberg (2004) has proposed eight steps of different activities as methodologies

for improving operational performance for organisation which is pre-study,problem identification, process mapping, measurement, selection, implementation,

and evaluation and lastly identify next problem.

The BPR methodologies also come in the form of company wide systemsuch as JIT or lean manufacturing and ISO9000 (Harvey, 2004). Even though the

methodologies used by two projects can never be the same due to the uniquenessof the project, the methodologies proposed by past researchers have some

commonalities. The commonalities are in the form of key phases involved in theBPR such as developing strategic vision, identifying and selecting business

process reengineering opportunities and others (Vijayalakshmi, 2004).Furthermore, Wu (2002) emphasizes the importance of corporate strategies to be

included in BPR methodology. The methodology proposes an integrativeapproach by focusing on the strategic aspect. Furthermore, it is consisting of

identification of corporate strategies, selecting strategic paths for BPR with ITapplication, and implementing BPR.

In practice, according to Carpinetti, Buosi, and Gerolamo, (2003) manycompanies, in their attempts to rapidly adopt world class management practicessuch as TQM, tend to devote little attention to the impact of such practices on

company strategic objective, market demands or even performance againstcompetition. Apparently it has been realized the importance of developing a

reference model for the business process of managing deployment andprioritisation of strategy related improvement and change actions that could

contemplate the systematic proposed. Carpinetti et al. (2000) has proposed anapproach for deploying strategy related improvements, which is basically

concerned with systematically deriving improvement actions from customerexpectations and strategic decisions through business processes, and prioritising

improvement actions that will most contribute to strategic objectives. To sum up,many organisations have created their own methodologies to carry out BPR,

unique and have variations. The right methodology to carry out certain processchange project will ensure its success.

Method

The research has used a dual-strategy method, which combine both quantitativeand qualitative methods (Neuman, 2006; Esterberg, 2001). The qualitative method

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is a plausibility check to the quantitative method, as it is based on the practicalexperience. These both approaches are to make a close relationship between the

researcher and practitioner to provide the necessary breadth and depth (Straussand Corbin, 1990). The paper focuses on the qualitative methodological part.

The Single Case Study

There has been relatively little development of inductive approaches in

process change research which inquire into more complex phenomena aboutchange approaches. The case study of the selected one manufacturing company

should provide answers to all the research questions and get in-depth evidence assuggested by Yin (1994). The qualitative approach is proposed to be conducted in

order to get a clear picture on process change as suggested in many researchers inthis field (Ahmad et al. 2007;Al-Mashari et al. 2001) and in the research methods

(Babbie2005; Bryman1989; Yin 1994).

In conjunction of that, a major semiconductor manufacturer namely InventorTechnologies Sdn. Bhd. has been selected as a case study write-up in this research.

The main purpose was to investigate the process change implementation in thecompany and to identify the process change methodology and the results of that

attempted. This case approach provided an overview, not only of process changeimplementation in the company, but also the companys the history and

application of process change. In this case, interviews were held with the managers(particularly whose functions related to operations and production), and whom

directly involved in relevant change projects. In addition, companydocumentations which content all the relevant information about the process

change projects were taken care.

Case Study Analysis and FindingsThe qualitative approach used semi-structured interviews, which were more

focused and directed giving meaningful interpretations of the existing data andanalysis. Descriptions of the findings is used which is in line with Yin (1994).

Focus of the Project: Process Change

This project seeks to explain and understand the process change practices

and methodology of Inventors core manufacturing operation in producingsemiconductors devices. It also suggests recommendation for the process change

improvement areas.Process is a flow of transforming input to output. Input is rawmaterials, which consist of raw frame, wire, and chips. The steps to put all the

materials together to produce a desired product are called process.

Process Change

The process of change has been characterized as having three basic stages:

unfreezing, changing, and re-freezing. This view draws heavily on Kurt Lewins

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adoption of the systems concept of homeostasis of dynamic stability (Fred Nickels,2004).

Process of change must be applied, if the process concept, qualityrequirements, design manual, electrical parameters, design rules, test vehicle or

other results must be changed after target setting or freeze. The process change

implementation can be minor and can be critical. Minor change is the changedwhich does not affect the quality or do not have impact on the package or product.Critical changes are the changes, which do touch the package and lead of the

component. The changes might be minor of a few microns, but the impact to thequality is obvious which will cause life if use in the field.

Why Process Needs Changes?

Process need changes when

changes are needed to suit other process change in the flow there is material change There is improvement can be made to improve the yield of the product. abnormality detected since day one the product is produced.

For any critical changes made to the component in term of material change,

method change, tools change in machine; there is a need to inform the customer(module manufacturer) to see whether there is any concern from customer side in

these changes. Any small changes in process may have no concern over thechanges; implementation of the change will be carried out.

Yield Improvement

When process is stable, the products produced are reliable and the qualityis assured. A process is considered stable where the fluctuation of the yield on

specific product is les. For example, the yield of 999.5% will fluctuate at 0.2%.To improve yield from 95% to 99% is easy, but to improve yield from 99.5% to

99.6% is very though because there are not much space for improvement. Processengineering is a job function, which needs to improve the quality and reliability of

the product.In order to improve quality and yield of the product, improvement projects

are needed to be carried out. There are many things to be done in term of 4Ms,which are Material, Man, Method and Machines. Based on the aspects, ideas can

be generated to solve corporate losses in term of minimizing rejects and reducingcost of the products.

Material: Material used can be changed; Material supplier can be changedMan: Human handlingMethod: Manual or automatic

Machine: Machine error; Machine problem; Preventive maintenance

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Manufacturing Process Flow

Below is the process flow of a package produce.

Rejects

Rejects can be classified into non-critical rejects and critical rejects. Non-critical rejects is cosmetics rejects on the surface of the product that do not fulfill

the specification of customer. Critical rejects is rejects, which involved internaldamage of the products and caused functionality failure. For automotive industries,

every single products critical. Non-functionality of a product can cause a life. Highquality alert is needed to be imposed to each one in the production floor to produce

good product. Because they may be the one who use the product that is produced

themselves.

Implementation: Process Change Methodology

Process change methodology are varies and unique based on differentprojects. The company took a Moulding Process as exemplar for this case

analysis, this project named as Yield Improvement Project which was

Wire Bond

2nd Die Bond

2ndWire Bond

Primer

ASSY 100% Visual Ins ection

Mouldin

Post Mold Cure

Platin

100% Visual Ins ection

Trim and Form

Water Saw

Die Bond

Testin

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undertakenin the 2006. The process change methodology consisted of seven steps 1) Initial Stage; 2)Process Study; 3) Process Needed for Improvement; 4)

Parameter Change; 5) Evaluation Run; 6) Checking and Testing Process; and 7)Decision Making and Implementation.

1. Initial Stage (99.1%)Yield monitoring on weekly break down for rejects Pareto. Identify therejects that contribute the most to the down turn of yield.

2. Process Study

Process study is carried out to identify the root cause of the occurrence ofthe rejects. Factor involving 4Ms (Man, Material, Method and Machine) will be

studied to trigger the solution for the process.

3. Projects Needed for ImprovementAfter studying all factors which is able to contribute to the rejects. Projects

will be generated and carried out to increase the yield. One project will be carriedout a time to avoid variables in defining the real root cause. In this example, we

shall take machine parameter as a root cause to increase the yield and cut down therejects. Due to the under optimization of parameter, more rejects is generated.

4. Parameter Change

The first project we can generate is to optimize the machine parameter inorder to reduce the rejects. Parameter change is critical which will have a big

impact on quality unless studies proven it are harmless. Evaluation need to becarried out to ensure the effectiveness and no harm to the quality.

5. Evaluation Run

Four lots of products with live units are needed to run the evaluation. Onelot will be used as the control lot, which follows the current parameter. Another

three lots will be used as evaluation lot to evaluate the effectiveness of the changeand quality of the product.

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Figure 2. Yield Improvement Project

(Increase Yield From 99.1% to 99.5%)

6. Checking and Testing Process

Dimensional Check

Dimensional check is a checking to check the physical condition of thecomponent where the package and lead of the component is fulfilling customer

specification so that it do not cause production failure at customer whenassembling the module. The component must be done in a way where it is able to

fit nicely to the solder paste on the module board.

Process Study

Parameter Change

Evaluation Run

Dimensional Check

Functional Test

Reliability Test

Test

Decision Making

Register & Present at PMB and Nermal

Approval

Implementation

Checking

andTesting

Process

DecisionMaking and

Implementation

Yield 99.1

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Functional Testa) SAT check

The checking is implemented to know whether the condition ofencapsulation of the chips is good enough to stand all the mechanical (vibration)

and electrical stress in hot (260C), room temperature (28C) and cold weather (-

150C). When encapsulation is good, the product can be used up to 10 yearswithout failure. When delaminating is detected under 0km, assessment is needed tobe done on the lot of product produced. Besides the lots, three lots before and after

the lot is needed to be assessed to prevent any field failure which can cause deathto customer.

If the control lot and all the evaluation lot are comparable in quality inSAT, the units are then loaded to run reliability test.

b) X-Ray checkX-ray check is needed to check the condition of wire inside the component

is in good condition. There are no broken wires (due to handling issue) or shorting

between wires inside the component. The condition of the wire must be the sameas the condition before encapsulation. During the encapsulation process, the

encapsulation compound should not have strong impact on the wire which causewire sweep.

Reliability Test

Reliability test is an important to test the reliability of the product. This testis needed to build confident level for engineers on the component before

proceeding to any action.

a) PreconditioningMoisture Soak:

The units will under go moisture soak for 168 hours under 85C. This testis to determine is there any failure after under go through moisture

condition.

Times Reflow:This is to test the reliability of the unit at customer side to solder the unit

on the module board. This also ensures the unit is able to stand under greatheat of more than 200C.

500Tc and 1000Tc Check:

This checking is done by putting the component to an oven to test thereliability of the component also. When the component has passed testing

after 500Tc, this indicates that the component is reliable and workable for5 years. When the component has passed testing after 1000Tc, this means

the components can function for 10 years.

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TestAfter under go all the Checking Process, all the units are still in good

condition after the functional ad reliability test.

7. Decision Making and Implementation

Decision-Making

After all the checking and testing done, comparison between control lotand evaluation is done to ensure the efficiency and no impact on quality of the

change. Decision is then made to continue with the changes.

Register & Present at PMB and NermalAll changes before implementation must be registered under Process

Module Board (PMB). Second level managers whom are process manger,production manager, quality manager, manufacturing manager and a director, host

the board. If the changes are minor, the board will accept it. Before accepting, eachchange must have and assessment report to support the change, which proves that

no quality issues will arise.For critical changes, which involve critical parameter change, the person in

charge needs to register the change under PMB then to the Local ChangeManagement (LCM) Board. The changes are needed to be presented to the board.

The board will determine whether this is change can be accept or not. For thischange, more assessment is needed to support the change. Question will be asked

during presentation on certain concern by the mangers to cater batter change andimprovement. For example, if the change will affect the cycle time of production,

so the production manager will bring out his concern and the team will need tofind away to solve this issue.

Before registering the change to PMB and Local Change Management,evaluation must be carried out and results show must be positive. There are several

basic checking needed to be done which is SAT check (define the delaminating tothe package), dimensional check, preconditioning and testing. The process

changed wills be accepted only if the checking above is passed. After presentationand the board have accepted the change, then the change is 50% accepted. For

each critical change, notification to customers is needed to see if there is anyconcern on customer side. If the customer has no concern, the change will be

accepted and implemented.

Registration and RecordingProcess change must be recorded and registered for monitoring and future

traceability purpose. The recording and registration have must be in detail, whichincludes date changed and what parameter is changed. The system is created in

such a way that everything is needed to be filled in detail. He changes must beregistered in the Germany Global Change management recording system besides

registering to PMB and LCM.

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There is another recording we need to do is to put the change into FailureMode and Failure Analysis (FMEA) which indicate the Potential FMEA. Each

process will have its own FMEA. All the failure or capability of the process willbe recorded under this report.

Approval and ImplementationAfter the application is approved, the change is then can be implemented.

Conclusions and RecommendationsThe company which adopted the business process change or reengineering

would be become more responsive to the market place as well as increase theoverall efficiency of their operation. In an effort to improve process effectiveness

and efficiency, process change often starts from ground zero to redesign process.This approach provides an opportunity for new and innovative ideas to be

introduced while taking advantage of the latest state of the art technology. Thefundamental concept of information technology (IT) enabled process redesign will

continues to play an important role in process performance improvement.This research would recommend the integrating of operational excellence

with the Six Sigma practices especially the DMAIC (define, measure, analyze,improve and control) process into the existing process change practices in

Inventor. Six Sigma program is to effectively provide a framework and associatedmethodologies to analyze and evaluate manufacturing process with the goal of

reducing waste. Typically, Six Sigma improvement process also begins withidentifying a problem to be solved (initial stage) and then defining a project to

solve the problem as per current Inventor process change flow.This will greatlyhelp in the process study and improvement need process in the process change

flow where quantitative improvement tools can be used to collect initial datacollection and root cause analysis to the problem.

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