22 Quality, processes and control In spite of agreeing to your request to employ further inspection staff from January to increase finished product inspection to 100 per cent, you will see that overall quality costs have shown no significant change. I look forward to receiving your comments on this. Discuss the issues raised by the above memorandum. 5 You are a management consultant and have been asked to assist a manufacturing company in which 15 per cent of the work force are final product inspectors. Currently, 20 per cent of the firm’s output has to be reworked or scrapped. Write a report to the Managing Director of the company explaining, in general terms, how this situation arises and what steps may be taken to improve it. 6 Using a simple model of a process, explain the main features of a process approach to total quality management and improvement. 7 Explain a system for statistical process control (SPC) which concentrates attention on prevention of problems rather than their detection. 8 What are the basic tools of SPC and their main application areas? 2 Understanding the process Objectives ᭹ To further examine the concept of process management and improving customer satisfaction. ᭹ To introduce a systematic approach to: defining customer–supplier relationships; defining processes; standardizing procedures; designing/modifying processes; improving processes. ᭹ To describe the various techniques of block diagramming and flowchart- ing and to show their use in process mapping, examination and improvement. ᭹ To position process mapping and analysis in the context of business process re-engineering (BPR). 2.1 Improving customer satisfaction through process management An approach to improvement based on process alignment, starting with the organization’s mission statement, analysing its critical success factors (CSFs), and moving on to the key or critical processes is the most effective way to engage the people in an enduring change process. In addition to the knowledge of the business as a whole, which will be brought about by an understanding of the mission→CSF→process breakdown links, certain tools, techniques, and interpersonal skills will be required for good communication around the processes, which are managed by the systems. These are essential for people to identify and solve problems as teams, and form the components of the model for TQM introduced in Chapter 1. 24 Understanding the process Most organizations have functions: experts of similar backgrounds are grouped together in a pool of knowledge and skills capable of completing any task in that discipline. This focus, however, fosters a ‘vertical’ view and limits the organization’s ability to operate effectively. Barriers to customer satisfaction evolve, resulting in unnecessary work, restricted sharing of resources, limited synergy between functions, delayed development time and no clear understanding of how one department’s activities affect the total process of attaining customer satisfaction. Managers remain tied to managing singular functions, with rewards and incentives for their narrow missions, inhibiting a shared external customer perspective (Figure 2.1). Concentrating on managing processes breaks down these internal barriers and encourages the entire organization to work as a cross-functional team with a shared horizontal view of the business. It requires shifting the work focus from managing functions to managing processes. Process owners, accountable for the success of major cross-functional processes, are charged with ensuring that employees understand how their individual work processes affect customer satisfaction. The interdependence between one group’s work and the next becomes quickly apparent when all understand who the customer is and the value they add to the entire process of satisfying that customer (Figure 2.2). The core business processes describe what actually is or needs to be done so that the organization meets its CSFs. If the core processes are identified, the questions will come thick and fast: Is the process currently carried out? By Figure 2.1 Typical functional organization Understanding the process 25 whom? When? How frequently? With what performance and how well compared with competitors? The answering of these will force process ownership into the business. The process owners should engage in improvement activities which may lead through process analysis, self- assessment and benchmarking to identifying the improvement opportunities for the business. The processes must then be prioritized into those that require continuous improvement, those which require re-engineering or re-design, and those which require a complete re-think or visioning of the ideal process. The outcome should be a set of ‘key processes’ which receive priority attention for re-design or re-engineering. Performance measurement of all processes is necessary to determine progress so that the vision, goals, mission and CSFs may be examined and reconstituted to meet new requirements for the organization and its customers (internal and external). This whole approach forms the basis of a ‘Total Organisational Excellence’ 1 implementation framework (Figure 2.3). Once an organization has defined and mapped out the core processes, people need to develop the skills to understand how the new process structure will be analysed and made to work. The very existence of new process quality teams with new goals and responsibilities will force the organization into a learning phase. These changes should foster new attitudes and behaviours. Figure 2.2 Cross-functional approach to managing core processes 1 Oakland, J.S. (2001) Total Organisational Excellence, Butterworth-Heinemann, Oxford. 26 Understanding the process 2.2 Information about the process One of the initial steps to understand or improve a process is to gather information about the important activities so that a ‘dynamic model’ – a process map or flowcharts – may be constructed. Process mapping creates a picture of the activities that take place in a process. One of the greatest difficulties here, however, is deciding how many tasks and how much detail should be included. When initially mapping out a process, people often include too much detail or too many tasks. It is important to consider the sources of information about processes and the following aspects should help to identify the key issues. ᭹ Defining supplier–customer relationships. ᭹ Defining the process. ᭹ Standardizing procedures. ᭹ Designing a new process or modifying an existing one. ᭹ Identifying complexity or opportunities for improvement. Defining supplier–customer relationships Since quality is defined by the customer, changes to a process are usually made to increase satisfaction of internal and external customers. At many Figure 2.3 Total organizational excellence framework Understanding the process 27 stages in a process, it is necessary for ‘customers’ to determine their needs or give their reaction to proposed changes in the process. For this it is often useful to describe the edges or boundaries of the process – where does it start and stop? This is accomplished by formally considering the inputs and outputs of the process as well as the suppliers of the inputs and the customers of the outputs – the ‘static model’. Figure 2.4 is a form that can be used to provide focus on the boundary of any process and to list the inputs and suppliers to the process, as well as the outputs and customers. These lists do not have to be exhaustive, but should capture the important aspects of the process. The form asks for some fundamental information about the process itself, such as the name and the ‘owner’. The owner of a process is the person at the lowest level in the organization that has the authority to change the process. The owner has the responsibility of organizing and perhaps leading a team to make improvements. Documentation of the process, perhaps through the use of flowcharts, aids the identification of the customers and suppliers at each stage. It is sometimes surprisingly difficult to define these relationships, especially for internal suppliers and customers. Some customers of an output may also have supplied Figure 2.4 Describing the boundary of a process 28 Understanding the process some of the inputs, and there are usually a number of customers for the same output. For example, information on location and amount of stock or inventory may be used by production planners, material handlers, purchasing staff and accountants. Defining the process Many processes in need of improvement are not well defined. A production engineering department may define and document in great detail a manufacturing process, but have little or no documentation on the process of design itself. If the process of design is to be improved, then knowledge of that process will be needed to make it tangible. The first time any process is examined, the main focus should be to put everyone’s current knowledge of the process down on paper. A common mistake is to have a technical process ‘expert’, usually a technologist, engineer or supervisor, describe the process and then show it to others for their comment. The first information about the process should come instead from a brainstorming session of the people who actually operate or use the process, day in and day out. The technical experts, managers and supervisors should refrain from interjecting their ‘ideas’ until towards the end of the session. The resulting description will be a reflection of how the process actually works. During this initial stage, the concept of what the process could or should be is distracting to the main purpose of the exercise. These ideas and concepts should be discussed at a later time. Flowcharts are important to study manufacturing processes, but they are particularly important for non-manufacturing processes. Because of the lack of documentation of administrative and service processes, it is sometimes difficult to reach agreement on the flowcharts for a process. If this is the case, a first draft of a process map can be circulated to others who are knowledgeable of the process to seek their suggestions. Often, simply putting a team together to define the process using flowcharts will result in some obvious suggestions for improvement. This is especially true for non- manufacturing processes. Standardizing procedures A significant source of variation in many processes is the use of different methods and procedures by those working in the process. This is caused by the lack of documented, standardized procedures, inadequate training or inade- quate supervision. Flowcharts are useful for identifying parts of the process where varying procedures are being used. They can also be used to establish a standard process to be followed by all. There have been many cases where standard procedures, developed and followed by operators, with the help of Understanding the process 29 supervisors and technical experts, have resulted in a significant reduction in the variation of the outcomes. Designing or modifying an existing process Once a process map has been developed, those knowledgeable in the operation of the process should look for obvious areas of improvement or modification. It may be that steps, once considered necessary, are no longer needed. Time should not be wasted improving an activity that is not worth doing in the first place. Before any team proceeds with its efforts to improve a process, it should consider how the process should be designed from the beginning, and ‘assumption or rule-busting’ approaches are often required. Flowcharts of the new process, compared to the existing process, will assist in identifying areas for improvement. Flowcharts can also serve as the documentation of a new process, helping those designing the process to identify weaknesses in the design and prevent problems once the new process is put into use. Identifying complexity or opportunities for improvement In any process there are many opportunities for things to go wrong and, when they do, what may have been a relatively simple activity can become quite complex. The failure of an airline computer used to document reservations, assign seats and print tickets can make the usually simple task of assigning a seat to a passenger a very difficult one. Documenting the steps in the process, identifying what can go wrong and indicating the increased complexity when things do go wrong will identify opportunities for increased quality and productivity. 2.3 Process mapping and flowcharting In the systematic planning or examination of any process, whether it is a clerical, manufacturing, or managerial activity, it is necessary to record the series of events and activities, stages and decisions in a form which can be easily understood and communicated to all. If improvements are to be made, the facts relating to the existing method must be recorded first. The statements defining the process should lead to its understanding and will provide the basis of any critical examination necessary for the development of improvements. It is essential, therefore, that the descriptions of processes are accurate, clear and concise. Process mapping and flowcharting are very important first steps in improving a process. The flowchart ‘pictures’ will assist an individual or team in acquiring a better understanding of the system or process under study than would otherwise be possible. Gathering this knowledge provides a graphic 30 Understanding the process definition of the system and the scope of the improvement effort. Process mapping, is a communication tool that helps an individual or an improvement team understand a system or process and identify opportunities for improvement. The usual method of recording and communicating facts is to write them down, but this is not suitable for recording the complicated processes which exist in any organization. This is particularly so when an exact record is required of a long process, and its written description would cover several pages requiring careful study to elicit every detail. To overcome this difficulty certain methods of recording have been developed and the most powerful of these are mapping and flowcharting. There are many different types of maps and flowcharts which serve a variety of uses. The classical form of flowcharting, as used in computer programming, can be used to document current knowledge about a process, but there are other techniques which focus efforts to improve a process. Figure 2.5 is a high level process map showing how raw material for a chemical plant was purchased, received, and an invoice for the material was paid. Before an invoice could be paid, there had to be a corresponding receiving report to verify that the material had in fact been received. The accounts department was having trouble matching receiving reports to the invoices because the receiving reports were not available or contained incomplete or incorrect information. A team was formed with members from the accounts, transportation, purchasing and production departments. At the early stages of the project, it was necessary to have a broad overview of the Figure 2.5 Acquisition of raw materials process map Understanding the process 31 process, including some of the important outputs and some of the problems that could occur at each stage. The process map or block diagram in Figure 2.5 served this purpose. The sub-processes, activities and tasks are shown under each block. Figure 2.6 is an example of a process diagram which incorporates another dimension by including the person or group responsible for performing the task in the column headings. This type of flowchart is helpful in determining customer–supplier relationships and is also useful to see where departmental boundaries are crossed and to identify areas where interdepartmental Figure 2.6 Paperwork for sale of product flowchart . and outputs of the processes, and in terms of the customers of and suppliers. 2 .5 Statistical process control and process understanding Statistical process control (SPC) has played a major part in the. Understanding the process Figure 2. 8 ‘Classic’ flowchart for part of a contact lens conversion process Understanding the process 35 Every route through a flowchart must lead to an end point and each process step. approach to managing core processes 1 Oakland, J.S. (20 01) Total Organisational Excellence, Butterworth-Heinemann, Oxford. 26 Understanding the process 2. 2 Information about the process One of the initial