Summer 2016 Volume 24 Issue 1

The Partnership News is the official publication of the ASQ Customer-Supplier Division.

Articles, information, and suggestions should be addressed to: Steve MacDougall steven.macdougall@honeywell.com

Inquiries should be directed to: ASQ 600 North Plankinton Ave. Milwaukee, WI 53203 800-248-1946 (USA and Canada) 414-272-8575 (International) 414-272-1734 (Fax) www.asq.org

ThePartnershipnewsFrom the Chair Greetings my fellow CSD members!

I am honored to share current news and some key milestones to recognize and celebrate the volunteers and spirit that continue to define and shape CSD’s legacy!

Every May, the CSD team gathers during the World Conference on Quality and Improvement. This year as I was leaving the World Conference, I reflected on the events of five days in meetings, networking, learning, and working with friends and colleagues. I left Milwaukee with a strong sense of pride, but also filled with deep gratitude and appreciation for all the great leaders and volunteers who are actively engaged in fulfilling CSD’s vision! Let me give just a few examples and offer some well-earned recognition:

• CSD received Gold Level Recognition for 2015 in ASQ’s Performance Awards and Recognition (PAR) program. For 2015, CSD was one of only four divisions and eight member units in total to receive this level of recognition! The PAR criteria evaluate performance in three areas, including member retention and growth, member value creation, and member leader engagement. Kudos to everyone on the CSD member leader team!

• While CSD has always been a pioneer and innovator among ASQ member units in creating and delivering course content to meet members’ learning needs, our meetings at WCQI were significant as we embraced a systemic approach to align CSD’s future offerings to best support member and stakeholder content requirements. The recently developed Body of Knowledge for the new Certified Supplier Quality Professional has helped identify some needs for new content, including a new prep course. During the working meeting we began mapping the content of all our current supplier quality courses to ensure courses ultimately have no critical gaps and only minimal overlap between courses. Thanks for those who stayed after WCQI to assist with this, and to Aimee Siegler for organizing and facilitating this meeting with the ASQ Learning Institute!

• Last but not least, I am so tremendously appreciative for all the volunteers involved in developing our new ASQ certification—the Certified Supplier Quality Professional (CSQP), as well as the update to our Supplier Management Handbook (both expected available this fall). CSD is also working on developing a new prep course to support the CSQP. In particular, I’d like to acknowledge three folks for their leadership in these initiatives: Shawn Armstrong, Mark Durivage, and Aimee Siegler. Thanks to each of you for your very significant contributions!

I hope you will check out our fall courses listed in this issue as well. In September, we will be in the Boston, MA, and Providence, RI, areas and in October we sweep through Texas—Dallas/Ft. Worth, Austin, and Houston. Sign up for the courses you need in the location that best suits you!

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From the Editor As always, I look forward to your questions and your feedback! Please feel free to contact me anytime (jeff@satisfactionstrategies.com)!

Warm Regards,

Jeff Israel Customer-Supplier Division Chair

May 2016 WCQI Booth Question What is your funniest or most unique supplier experience?

FUNNIEST:

1. Our salesman visited a client, where he had to wear a hairnet for the tour at 8:00 a.m. At lunch that day he ran his fingers through his hair and was still wearing the net!

2. I left a customer from Mexico at a restaurant, when he was supposed to come back to the plant!

3. Walked into an audit and was asked: “Oh! Is it the audit today?”

4. Have you ever broken into a supplier’s manufacturing plant during an audit? My auditee and I broke in through a window to continue our audit one time!

MOST UNIQUE (Good/Bad and/or Ugly):

1. On a supplier audit, I got to be a total space geek and touch an actual Space Shuttle engine!

2. The time one of our AC suppliers sent our core product to our worst competitor!

3. Supplier shuts down operations and sends everyone home when they know you’re coming for an audit!

Our 2016 fall training schedule is online now.

For more information, or to register now, please visit: asq.org/csdtraining/ or contact ASQ Customer Care at 800-248-1946 or help@asq.org.

Sign Up Now for Your Fall Training!

ASQ training courses can help you stand out among your peers. Between the in-depth knowledge and credibility you’ll learn, you’ll see immediate benefits and results from these courses, and you’ll gain important information on supplier performance and customer satisfaction. Learn ways to improve both of these, resulting in more effective programs and processes.

Start with our fall colors tour, September 26 – 29 in Boston, MA, and Providence, RI. There, we will offer Supplier Auditing, Introduction to Supplier Management, and Improving Customer Satisfaction.

Next we’ll head deep in the heart of Texas, with offerings in Dallas, Austin, and Houston. Courses offered here will include Supplier Auditing and Handling Supplier Nonconformances.

Our fall instructors include Pamela Carvell, Richard Gould, Philip Heinle, Jeff Israel, and Patricia La Londe, bringing years of expertise to life in the classroom.

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The Beauty of 5 Whys Problem SolvingBy John J. Casey

When I was a boy, my grandmother used to read me nursery rhymes to both entertain and teach me about the world. There was one that has resonated with me for years that I’d like to share with you:

For want of a nail the shoe was lost. For want of a shoe the horse was lost. For want of horse the warrior was lost. For want of a warrior the battle was lost. For want of a battle the kingdom was lost. All for want of a nail.

This little poem displays the heart of 5 Whys analysis used by many in the automobile industry—especially the Japanese. Basically, 5 Whys analysis is a fundamental approach to thinking, based on the logical linkage of events into a cause and effect analysis. This is a very simple process to explain. Look at a problem, then ask yourself “Why did this happen?” and repeat the process about five times and you will typically come to a root cause. In the poem above, the problem was the kingdom was lost. The series of why questions leads you through the loss of the battle, due to a shortage of warriors, ultimately due to not enough nails in the hands of the blacksmith.

It’s a simple process of logical connections. It is a method for problem solving that gets to some

hard-to-identify causes and gives you the opportunity to see issues that have a leveraging effect on the overall process. That’s the beauty. A simple process that gives you great leverage when properly deployed because it takes you to the root of the problem.

Our Over-Reliance on “Sophisticated” Problem SolvingAcross industry today, you will hear about many advanced problem-solving methods. Popular methods like Six Sigma approaches, Red X approaches, Kepner-Tregoe, and others have a definite place in our world. Some problems are extremely complicated and involve a number of interrelationships. There are times that these tools are essential. We all know that if you organize the situation and combine it with properly collected data, precise solutions can be

found. However, most problems do not require this extreme level of structure and analysis. In fact, many people get intimidated by the statistics and data collection so they stop the problem-solving analysis before they even start and tolerate the negative consequences.

One of the keys to having a great company is to get everyone involved in the improvement process. To improve, you need to overcome the constraints of today and make your world a better place. In reality you are problem solving. As explained in Jeffrey Liker’s book The Toyota Way, the pinnacle of operational effectiveness comes from Toyota’s emphasis on problem solving. Toyota sees this as the main driver of competitiveness—get everyone in the company working to solve problems. Their fundamental method is using the 5 Whys approach. It’s simple. It’s logical. It’s effective. Everyone can do it, especially people on the plant floor.

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Lost the kingdom

Lost the battle One less

warrior One less horse Horse

lost shoe Not enough nails

RESULT

ROOT CAUSE

Why

WhyWhy

Why WhyWhy

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The Therefore TestWhen using the 5 Whys method, it is rather tricky to keep logic straight. Humans have an infinite capacity to think of things and often clutter their thoughts with extraneous information. While 5 Whys is easy to explain, it is very hard to do because people often will bring in biased thinking or somewhat related information that is NOT on the critical logic path. They often get off on tangents and need a method to keep things in order.

The most effective method is to impose the “therefore” test on the 5 Whys. What you do is to read the 5 Whys in reverse and insert the word “therefore” between each step. If the stream of logic makes sense in reverse, then the logic is probably solid. In the Nail and the Kingdom proverb, the therefore test was implied.

The blacksmith did not have enough nails. – Therefore

The horseshoe could not be attached. – Therefore

The warrior could not get to the battle. – Therefore

The army was outnumbered. – Therefore

The battle and kingdom was lost.

This simple test can verify the logic of the 5 Whys and help people see where they are off on a tangent and give them an easy method to stay on track.

Going for the Real Gold: The Trifecta!With all the discussion on horses and riders, using a horse-racing example just seems to make sense. There is a popular betting approach where a much larger prize is awarded if the bettor selects three winners in different races—or hits a trifecta.

In problem solving, a trifecta is possible as well especially when customer complaints are involved in the problem. To get to the real gold, problem solvers of customer-

perceived problems need to seek root causes from three perspectives:

Specific cause: Why was the customer complaint created?Detection cause: Why did test methods not filter it out?Systemic cause: Why was the overall system weak in the first place?

The Specific CauseWhen most people think of problem solving, they think of the specific root cause. You have a discrepant part, some machine or process wasn’t done correctly,

and bingo, you have found the issue. As an example, if there is a rattle in your car and you find a loose screw, tighten it up and the rattle goes away—you have found the core of the problem. Most people perform this step very well. Find the issue, shut it off, save some money, and become more competitive. But there is more gold to be had. Great root cause analysis will dig past this symptom (loose screw) and look at the operation to tighten the screw and seek the core of the problem. It could be a worn tool bit, it could be a defective motor, it could be operator fatigue or a mistake. Your analysis would be well served to look for the true cause of the issue.

Lost the kingdom

Lost the battle

One less warrior

One less horse

Horse lost shoe

Not enough nails

RESULT

ROOT CAUSE

Why

Why

Why

Why

Why

Why

Therefore

Therefore

Therefore

Therefore

Therefore

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Direct Root CauseHow did you create the problem?

Detection Root CauseHow did you let it escape?

Systemic Root CauseWhy weren’t our production and quality systems

robust enough to adequately protect the customer?

People doing the work

Floor-level people- Production- Skilled trades- Material control- First line supervision

Support people- Management- Purchasing- Engineering- Policies- Procedures

People who set up the process

The Detection CauseEvery company deploys means to check their work before it goes to the customer. If problems can happen (and they always can), the companies that do the best job at protecting the customer from problems will win in both the short and long term. The short-term success is lower customer satisfaction costs—like rework, replacement, and repairs. The long-term benefits are enhanced reputation and increased customer loyalty. While shutting off the cause of the problem is great, there is “double gold” if you analyze your inspection and detection methods to determine how the problem escaped.

There are four aspects that repeatedly surface as holes in the detection system. The first, the process is just not looking for the specific defect. Either the forecast failure was overlooked or considered not to be possible in the planning phase. This detection failure category is best described as a failure in the detection scope—the system is not looking.

As a closely related category, the second issue is one of detection tool capability, or specifically, are tools and methods in place to reliably detect and see the issue? Many times there is no cost-effective method to identify the discrepancy and the business has accepted the risk of a defect getting to the customer.

The third repetitious detection failure involves some type of detection bypass.

This occurs when inadequate discipline is in place to force every product through a capable detection device. The checking unit was capable and ready, people just did not have adequate discipline to use the system and protect the customer.

The last common detection failure is one of escape, and this is the most disheartening. These are situations where a discrepant part is properly identified by the detection system, and for some reason the known bad part was placed into the flow to get to the customer. The bad part “escaped” its quarantine.

While there are other causes for the detection system to fail, these four categories comprise well over 80 percent.

The Systemic Cause: The Solid GoldExtending the 5 Whys process into the systemic arena is where huge leverage occurs. In the systemic leg, the problem solver is looking at the overall management and development system, which created the production and detection system and looks at “Why was the process that we handed to the production operators not adequately robust?” We are looking at the management system. We are looking at the development system—both product design and process design. We are looking at the plant management system and how they ensure discipline within the system.

When you look at the systemic leg and find a true root cause—and fix it—you create massive leverage for the company because the fixes can be spread across your lines and plants today as well as lessons learned for future programs. This is massive leverage. This is the heart of the Toyota process. This is where true competitive advantages come.

When you look at a problem, have the determination to walk by the quick fix. Be the king in the kingdom. Would you like to lose your kingdom and your life because of a nail? I doubt it. Have the strength to nail down the problems.

About the Author John J. Casey is a quality professional and has worked for multiple OEMs in the automobile industry (Japanese and American). He has served as chair of various Automotive Industry Action Groups and has also served on its board of directors. Casey was also recently named as an ASQ Fellow.

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This column will focus on a topic that could cause some discomfort among companies in the process of launching a new/updated supplier development function since it could be seen as throwing skunks on the table relative to a current roll-out. Sorry, but I’ve been calling things as I see them for too long to change now and I’ve seen too many supplier development initiatives that were either stillborn or ended up as afterthought functions as a result of not being positioned to contribute significantly to overall company benefit. With that being said, please take my comments as constructive rather than critical.

The main point of my last column was that the role of OEM supplier development should be to align strategic supplier operations with customer strategic plans. If you dig down into it, this implies a lot of the work with a significant amount of it being both internal and necessary prior to any actual supplier interactions. Some of this laying-the-ground-work must actually be done prior to finalizing your supplier development strategy since to be effective, initiative deliverables must be formally bought-off on by departmental and company management. If you don’t get upfront agreement on how supplier development will dovetail with existing functions, your initiative will probably never play a significant role at your company.

Laying groundwork requires a

strong internal champion, and here is where I introduce what could perhaps be perceived as my biggest skunk in this article. In my column “The Case for Supplier Development,” I describe how many existing OEM supplier development functions have a primary responsibility of making sure that enough capable small/disadvantaged suppliers (S/DS) are available to source from such that the OEM’s product S/DS content level qualifies for governmental purchase. Because of this and the fact that S/DS suppliers often need assistance to achieve minimum acceptable capability levels, supplier development functions are often managed by S/DS organizations. In my experience this is a mistake. Why?

First, let me start by saying that the S/DS function does play a necessary role for many companies. But how many of you can truly say that S/DS holds a significant position within your supply management organization, i.e., has a “seat at the table”? I doubt many. So, the fact is that S/DS will usually not have the clout or exposure necessary to effectively do the earlier cited internal heavy lifting. This means that the process changes and strategic alignments that need to take place within a supply management organization—and for that matter, the overall company—will not take place, leaving your supplier development function to operation in relative

isolation. By relegating supplier development organizationally under the management of the S/DS function, it will never have the strong overall strategic influence you are looking for.

Second, let me point out that the traditional role of S/DS in most companies is more one of “advocacy” than anything else. Consequently, S/DS management is chosen based more on their relationship management skills rather than on their technical understanding of supply chain dynamics and manufacturing fundamentals. Sure, S/DS-led supplier development functions can usually cite isolated instances of having provided supplier competitiveness improvement assistance. This, however, is not what we’re looking for in next generation supply management. Improvements yielded by such management are incremental, at best. Instead, we need to be talking about a supplier development initiative that will be responsible for an overall supply base realignment, i.e., one that can have a step-function impact on their customers’ financial results. Having initiative leadership with the proper background and positioning is critical to making this happen.

So who should be chosen to lead a supplier development initiative launch? What is needed is an up-and-comer within the organization who has a strong

How Not to Launch a Supplier Development InitiativeBy Paul Ericksen, Executive Level Consultant July 5, 2016

This article first appeared on the IndustryWeek website http://www.industryweek.com/supplier-relationships/how-not-launch-supplier-development-initiative

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background in manufacturing and at least a bit of a thick skin. Make no mistake, crowbarring a strategic new function into an existing supply management hierarchy will upset many established apple-carts and probably result in significant internal criticism and pushback. Believe me, I have the physical and emotional scars such that I know whereof I speak!

Having a person with these attributes will give your initiative a chance of—but not ensure—success. Not having this type of person leading your initiative will probably result in it becoming either that stillborn function I referred to earlier or one that is an afterthought in an overall supply management scheme-of-things. The last thing you want leading any new initiative is an L.I.N.O., i.e., leader in name only. Putting someone in charge that does not have the personal characteristics necessary for developing or launching a new initiative—specifically one who is willing to get their hands dirty performing basic work elements—will cause it to fail.

Heavy lifting is also required outside of the OEM organization. Once a supplier development strategy and process that aligns with the company’s strategic aims are defined and agreed to internally, you need to consult with your top strategic suppliers to gain their feedback about whether it is practical. Making a program palatable to the important suppliers whom you depend upon and know will be in your supply base for the foreseeable future is critical to an initiative’s success. Call these suppliers in, lay out your strawman proposals—including metrics—and take their suggestions for change as constructive, and not as criticism.

If 80 percent of what you lay out ends up in your final program, you did a great job of aligning your initiative with something that your supply base is capable of taking on. On the other hand, rolling out a program they are not ready for makes very little sense. Getting supplier input into your supplier development program will give them ownership, which is always good when rolling out something new.

Not getting this input will likely end up generating supplier stonewalling, as many go through the motions to try to keep you happy while also resisting having to make any real operational change.

A point needs to be made here: Don’t try to outsource the heavy lifting of defining your strategy or process to academics or process-focused (e.g., lean) consultants. They won’t understand your company’s culture or its strategic plan, i.e., what you are trying to do. More importantly, they also won’t have understanding of your supply base and their individual situations. Further, while most will be able to cite a prior work record of working with individual firms, few will have any significant experience in working with supply chains that they can point to.

That’s not to say that you shouldn’t consult with outside experts in developing the details of your program, but realize you will need to do significant tailoring of what they offer in order to develop your own successful initiative. If you over-rely on such resources you’ll end up—at best—with a “vanilla” approach that won’t really align with program intentions and in the end, will lead to “vanilla” results (again, at best).

Program launches must be well planned and supported. Don’t plan on shooting-from-the-hip during the roll-out of your program to suppliers. Once you’ve defined the process you intend to use, spend significant time and resources in both documenting it and providing resources that your suppliers can reference. Consequently, an initiative website with videos, instructions, guidebooks, forms, etc., should be developed and available before rolling out the initiative. Why? There are at least a couple of reasons:

• First, suppliers will need to sell the initiative to the powers-that-be within their organizations and you need to be the primary help to them in doing so by providing them with the material needed to make that case.

• Second, while you will have supplier development resources available in the implementation of your initiative, you’ll

never have enough of them to do all of the work that will be needed across all of your strategic suppliers. In fact, much of the work will need to be done by supplier resources with your supplier development engineers acting more as consultants/project managers than performers of tasks. So any material you can provide suppliers that facilitates the doing of actual project work will position them for implementing and owning the needed internal improvements.

• Finally, providing such resources will reinforce with suppliers the importance your company places on the initiative, i.e., it will demonstrate to them that it’s not just another program-of-the-month.

My last skunk involves OEMs needing to “walk the walk,” not just “talk the talk.” If you are rolling out a supplier development strategy that you can tell your suppliers is also being implemented to your internal operations, that will go a long way in selling them on the initiative. Further, if you can say that the same goals and metrics are being used to measure internal operational success as are being applied to the supplier performance, you’ll go a long way toward getting buy-in from suppliers to what you are looking for them to accomplish.

For instance, if you are rolling out a supply base cost reduction goal but your own factories are not operating under the same cost reduction expectations, your initiative will lose a lot of credibility and likely be seen as just another profit-grab. And, needless to say (if you’ve read my previous columns), having a piece-price reduction as the primary basis of a supplier development initiative is probably the best way—for a variety of reasons—to ensure your initiative will be stillborn.

So, there’s my formula for how NOT to launch a supplier development initiative along with ideas on what you need to do to position supplier development to be an effective part of your supply management organization.

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2016 Customer-Supplier Division Officers and Committee ChairsChairJeff Israel SatisFaction Strategies, LLC jeff@satisfactionstrategies.com

Incoming ChairStephanie Parker Boon Edam, Inc. stephanie.parker@boonedam.com

Immediate Past Chair and Nominating Committee ChairShawn A. Armstrong Grace Bio-Labs stat30658@gmail.com

TreasurerPamela L. Carvell Pfizer Inc. pam.carvell@pfizer.com

SecretaryUrsula Williams Brooks Automation, Inc. Ursula.Williams@brooks.com

Audit Committee ChairRebecca Carroll Quanta Computer Nashville beccy.carroll@quantanashville.com

Membership Committee Chair and VoC ChairEdward Kendrick Sr. Quality Promoters ed.kendrick@qualitypromoters.com

QBoK ChairJeff Jaswa jeff.jaswa@yahoo.com

Conference Chair and ASQ Standards Committee RepresentativeChris Riegel Amsted Rail Company CRiegel@griffinwheel.com

Social Responsibility ChairAimee Siegler Benchmark Electronics Aimee.Siegler@bench.com

Education Committee ChairMaria V. Stoletova Integrated Quality Strategies m_stoletova@hotmail.com

Newsletter EditorSteve MacDougall Honeywell Aerospace Steven.MacDougall@honeywell.com

Examining Committee ChairRichard A. Gould DickGouldCSP@aol.com

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