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MANAGING FOR QUALITYMANAGING FOR QUALITYPROCESS IMPROVEMENTPROCESS IMPROVEMENT

DR. YONATAN RESHEFUNIVERSITY OF ALBERTA

SCHOOL OF BUSINESSEDMONTON, ALBERTA

CANADA T6G 2R6

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STABLE SYSTEM/PROCESSSTABLE SYSTEM/PROCESS

A PROCESS WILL BE IN STATISTICAL CONTROL WHEN, THROUGH THE USE OF PAST EXPERIENCE, WE CAN PREDICT, AT LEAST WITHIN LIMITS, HOW THE PROCESS WILL BEHAVE IN THE FUTURE

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PROCESS IMPROVEMENTPROCESS IMPROVEMENTIMPROVEMENT OF A STABLE

PROCESS CANNOT BE DONE BY TAMPERING WITH OUTPUT (E.G., MANAGING BY RESULTS)

ACTION BASED ON RESULTS CAN ONLY BE APPROPRIATE IN THE PRESENCE OF SPECIAL CAUSES

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CAUSES OF VARIATIONCAUSES OF VARIATIONSPECIAL CAUSES (SIGNAL) –

PROBLEMS ATTRIBUTABLE TO INDIVIDUALS WHO ARE OUT OF STATISTICAL CONTROL

COMMON CAUSES (NOISE) – PROBLEMS ATTRIBUTABLE TO THE SYSTEM (I.E., MANAGEMENT)

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VARIATIONVARIATIONTWO COMMON MISTAKESTWO COMMON MISTAKES

OVER-ADJUSTMENT – ASCRIBING VARIATION OR A MISTAKE TO A SPECIAL CAUSE WHEN IN FACT THE CAUSE BELONGS TO THE SYSTEM

DOING NOTHING – ASCRIBING VARIATION OR A MISTAKE TO THE SYSTEM WHEN IN FACT THE CAUSE IS SPECIAL

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TAMPERING WITH A TAMPERING WITH A SYSTEMSYSTEM

TAKING ACTION ON A STABLE PROCESS IN RESPONSE TO PRODUCTION OF A FAULTY ITEM OR A MISTAKE (OVER-ADJUSTMENT)

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INSPECTION, OR NO INSPECTION, OR NO INSPECTIONINSPECTION

IF PROCESSES ARE IN STATISTICAL CONTROL, THERE ARE ONLY TWO CHOICES: NO INSPECTION OR 100% INSPECTION

IF PROCESSES ARE IN CONTROL, A SAMPLE FROM A BATCH CONTAINS NO NEW INFORMATION CONCERNING THE UNINSPECTED ITEMS IN THAT BATCH

THE CHOICE BETWEEN THE TWO ALTERNATIVES – WHETHER TO INSPECT OR NOT – IS MADE ON THE BASIS OF ECONOMICS, SAFETY, ETC.

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CHAOSCHAOS

A “STATE OF CHAOS,” THAT IS WHEN PROCESSES ARE OUT OF CONTROL, DESERVES CONSIDERATION OF 100% INSPECTION

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LESSONS FROM THE RED LESSONS FROM THE RED BEAD EXPERIMENTBEAD EXPERIMENT

THE PROCESS TURNED OUT TO BE STABLE – THE VARIATION AND OUTPUT WERE PREDICTABLE

ALL THE VARIATION CAME ENTIRELY FROM THE PROCESS ITSELF. THERE WAS NO EVIDENCE THAT ANY WORKER WAS BETTER THAN ANOTHER

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LESSONSLESSONS

THE WORKERS COULD DO NO BETTER. “BEST PEOPLE DOING THEIR BEST” DOES NOT ALWAYS WIN THE DAY

UNDER SUCH CIRCUMSTANCES, RANKING IS WRONG, AS IT ACTUALLY MERELY RANKS THE EFFECT OF THE PROCESS ON PEOPLE

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LESSONSLESSONS

PAY FOR PERFORMANCE CAN BE FUTILE. THE PERFORMANCE OF THE WORKERS WAS GOVERNED BY THE PROCESS

DIVIDED RESPONSIBILITY – THE INSPECTORS WERE INDEPENDENT OF EACH OTHER (A POSITIVE PRACTICE).

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LESSONSLESSONSKNOWLEDGE ABOUT THE

PROPORTION OF RED BEADS IN THE INCOMING MATERIAL (20%) WOULD NOT ENABLE ANYONE TO PREDICT THE PROPORTION OF THE RED BEADS IN THE OUTPUT. THE WORKLOADS WERE NOT RANDOM DRAWINGS. THEY WERE EXAMPLE OF MECHANICAL SAMPLING

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SAMPLINGSAMPLING

EVERY BEAD MUST HAVE A CHANCE TO BE IN THE SAMPLE

IN OTHER WORDS, RANDOM SAMPLING MUST BE INDEPENDENT OF ANY PHYSICAL ATTRIBUTION OF THE EXPERIMENT – COLOR OF THE BEADS– SHAPE OF THE PADDLE– ANGLE OF THE RAISING OF THE PADDLE– SIZE OF THE SAMPLING BOWL

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LESSONSLESSONSAcceptable Defects: Rather than waste

efforts on zero-defect goals, Dr. Deming stressed the importance of establishing a level of variation, or anomalies, acceptable to the recipient (or customer) in the next phase of a process. Oftentimes, some defects are quite acceptable, and efforts to remove all defects would be an excessive waste of time and money.

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LESSONSLESSONS

THERE WAS NO BASIS FOR MANAGEMENT’S SUPPOSITION THAT THE 1-2 BEST WORKERS OF THE PAST WOULD BE BEST IN THE FUTURE

RIGID/PRECISE PROCEDURES ARE NOT SUFFICIENT TO PRODUCE QUALITY

NUMERICAL GOALS CAN BE MEANINGLESS