The Quality Guru

Auditing Customer Feedback Processes

2010-02-02T13:23:00.000-08:00

Customer feedback is a process. It needs to be audited as a process, not as a "clause of the standard". An evaluation also needs to be performed on the way in which the process is managed (see ISO 9001:2008 clause 8.2.1), and its ability to provide meaningful information with which to judge the overall effectiveness of the QMS. The way in which the organization obtains this feedback ("the method") is up to the organization to define. The standard states "Monitor information relating to customer perception." Sources can include surveys, customer data, compliments...

The auditor needs to be aware of the specific characteristics of the organization's products that are likely to impact customer satisfaction. Throughout the audit the auditor should be alert for indications that may suggest customer satisfaction or dissatisfaction which could serve as input into the audit of the customer feedback process.

Sources of information can include:

* Goods returned by the customer;
* Warranty claims;
* Revised invoices;
* Direct observation of, or communication with the customer (for example in a service organization).

These are some of the issues an auditor should address during an audit of the customer feedback process:

a) What is the desired output of this process? What information is actually available on customer perceptions? How is this information used by management to drive improvements to the product, processes and the QMS?

b) How is the data collected to feed the process? There are many ways for an organization to monitor its customers' perceptions, and the auditor should avoid preconceived ideas about how this should be done. Some examples of techniques the organization can use include:

* face-to-face visits and evaluations;
* telephone calls or visits made periodically or after delivery of products and services;
* internal enquiries among the organization's personnel who are in contact with customers;
* other contacts with customers, for example by service or installation personnel.

c) How is the data analyzed? Simply collecting data on customer perceptions is not sufficient - the auditor must follow the process through, to check how the data is analyzed and what conclusions are made with respect to the effectiveness of the QMS.

1) Are there any trends? 2) Is the situation stable, improving, or deteriorating? 3) Are customer needs and expectations changing? Asking the organization about industry comparisons, or benchmarking activities, in order to put customer feedback into perspective can be extremely valuable.

d) How does the information generated by this process feedback into the QMS as a whole? Organizations should be using the results of the customer feedback process to trigger corrective and/or preventive actions and as one of the overall measures of the QMS performance. Auditors should review the way in which these processes interact and subject it to the audit process.

The auditor should be able to recognize that the output from the customer feedback process forms an important input into other QMS process, such as data analysis, management review and continual improvement processes. An auditor who strives to add value will try to ensure that the organization recognizes the benefits a sound customer feedback process.

Share your thoughts / methods on how your company monitors and audits customer feedback.

Published New Edition of ISO 9004 - Path to Sustained Success

2009-11-25T13:34:00.000-08:00

The just-published new edition of ISO 9004:2009 provides organizations with a model for sustained success in today's complex, demanding, and ever-changing environment.

ISO 9004:2009- "Managing for the sustained success of an organization-A quality management approach," is the third edition of the standard first published in 1987.It is intended to support the achievement of sustained success by any organization, regardless of size, type, or activity, using a quality management approach.

Compared to ISO 9001:2008, which ensures quality management of products and services while enhancing customer satisfaction, ISO 9004:2009 provides a broader perspective of quality management, particularly for performance improvement. It will prove useful to organizations whose top management wishes to move beyond ISO 9001 in pursuit of ongoing improvement, measured through the satisfaction of customers and other stakeholders.

Although ISO 9004:2009 complements ISO 9001:2008 and vice versa), it can also be used independently. It is not intended for third-party certification,regulatory, or contractual use, nor as a guide to the implementation of ISO 9001:2008

To help users get the best out of the standard, an annex gives a clause-by-clause correspondence between ISO 9001:2008 and ISO 9004:2009.

ISO 9004:2009 allows organizations to enhance the quality of product and service delivery to their customers by promoting self-assessment as an important tool to enable organizations to: Benchmark their level of maturity, covering leadership, strategy, management system, resources, and processes. This includes identify their strengths and weaknesses, identify opportunities for either improvements or innovation, or both.

The self-assessment tool may become a key element during the strategic planning processes in any organization."The objectives of customer satisfaction and product quality are extended in ISO 9004:2009 to include the satisfaction of interested parties and the performance of the organization. The combination of ISO 9001 and ISO 9004 will allow you to get the most of your quality system," says Jose Dominguez, a leader of the ISO 9001 task group.

Purchase ISO 9004:2009 at the ANSI E-Store for $149.00
or at the ASQ Store for $76.00, member price.

Share your thoughts on this new edition with the Quality Guru and our readers!

Major Changes to New ISO 9004:2009 Standard

2009-09-10T16:50:00.000-07:00

The latest draft of ISO 9004:2009 has received broad approval and the final draft of this International Standard (FDIS) is due to be released before the end of 2009.

The new version has a title change. It's now: "Managing for the Sustained Success of an Organization-A Quality Management Approach."

The new version is also shorter than its predecessor, ISO 9004:2000 at 44 pages compared to 56. This reduction is in part due to the removal of the ISO 9001 text that appeared at the start of each section. Although ISO 9001 and ISO 9004 are still "a consistent pair" of standards, ISO 9004 no longer has the same clause by clause naming as ISO 9001. This helps to emphasize that it is not a guide to ISO 9001.

The contents of ISO 9004 (at the draft stage) are:

Scope
Normative references
Terms and definitions
Managing for the sustained success of an organization
Strategy for policy formulation, planning and development
Resource management
Process management
Monitoring, measurement, analysis and review
Improvement, innovation, and learning
Annex A: Self-assessment tool
Annex B: Quality management principles
Annex C: Correspondence between ISO 9004-2009, and ISO 9001:2008
Bibliography

The aim of ISO 9004 is to help users of ISO 9001 to obtain long-term benefit from a broader, in-depth, quality management system (QMS) based on their existing QMS. It uses the same quality management principles as ISO 9001. It is not to be used for assessment or certification purposes.

This standard will provide valuable guidance for managers on leading their organization towards long term success.and to build on existing quality management systems. ISO 9001 focussed on customers. ISO 9004 extends the focus to include all interested parties including society, suppliers, employees and shareholders.

We will keep you informed when the ISO 9004:2009 is published.

2009-07-13T15:57:00.000-07:00

The Quality Guru now has Web-Based Training Courses!

Maximize your training budget - Training is more affordable. With no travel or accommodation expenses, more people can be trained for less.
Minimize time away from the office – Training is self-paced. Participants can take the course when it is convenient for them.
Higher retention of content – Students have more control over their learning process and can better understand the material leading to a faster learning curve.

The current course catalog is as follows:

ISO 14001: 2004 - Overview and Implementation
ISO 9001:2008 Management Overview
Introduction to ISO 14000
Introduction to OHSAS 18001

More courses coming soon!

I also want to announce that I will be a presenter at the American Society for Quality (ASQ) 18th Annual Service Quality Conference on October 5-6, 2009 in Long Beach, CA. The session is "Finding Lost Profits in Your Service Processes."

Hope to see you there!

2009-05-15T12:59:00.000-07:00

The Aerospace Standard, AS9100, Revision C, is available for purchase now at the SAE International Website. This revision includes the requirements of the ISO 9001:2008 standard published in October 2008.

Major changes to this Aerospace standard include:

7.1.1 Project Management: New requirement for planning and managing product realization in a structured and controlled way.

7.1.2 Risk Management: New requirement of implementation of a risk management process applicable to the projects & products; responsibility, criteria, mitigation & acceptance.

7.1.3 Configuration Management: Moved from clause 4.3 to clause 7.1 and added details on the different activities to be covered.

7.1.4 Control of Work Transfer : Moved from clause 7.5 (Production) to clause 7.1 to add emphasis on having a process for planning and control of transfer activities.
Product quality and on-time delivery performance. Added requirement to measure "product conformity" and "on-time delivery" and take appropriate actions if planned results are not achieved. The intent is to provide a linkage between the QMS and organization performance.

Process to address control of Special Requirements: Critical Items and Key Characteristics. Key characteristic requirements remain unaltered but a new concept is added to identify special requirements from the Customer or internal sources that require additional controls (e.g. risk management) that translates into Critical Items that may flow to Key characteristics for variation control.

Formal monitoring of Customer satisfaction data: Added the requirement to monitor data and to develop improvement plans that address deficiencies. The intent is to promote continuous improvement of the product and Customer satisfaction.

Requirements from regulatory authorities: A general requirement has been introduced in 4.1 to address all the applicable statutory and regulatory QMS requirements in the organization's QMS instead of keeping detailed requirements in chapters.

First Article Inspection (FAI): moved to clause 7.5.1.1 and renamed. Production process verification "FAI" is the requirement to validate the production process's documentation and tooling and repeat the process when necessary (i.e. when engineering or manufacturing processes change). The requirement was moved from 8.2.4.2 (measurement) to 7.5.1.1 (production) because it is part of product realization and is not intended to be a follow-on activity.

Difference between Key Characteristics, Special Requirements and Critical Items: Special Requirements are those requirements that have high risks to being achieved, which require their inclusion in the risk management process. Critical Items, including key characteristics, are those items that have significant effect on product realization and use of the product, which require specific actions to assure they are adequately managed.
AS9100C is consistent with ISO 9001:2008 and the length of time to transition is 30 months. Companies will be encouraged to upgrade on their scheduled audit cycle.

Improvement comments from Aerospace OEM's and IAQG regarding what their supplier expectations are from this new standard include :

Expect registrar auditors to go deeper into auditing sample sizes;

Improve classification of nonconformances, example less opportunities for improvement and more major and minor corrective action identification;

100% compliance expected, less exclusions and improved objective evidence;

More Root Cause Analysis (RCAA) tools and methods used. No more "operational /human error" root causes;

Improved monitoring and measurement of company objectives, and if applicable why objectives are not being met;

Zero tolerance on poor supplier quality and inadequate supplier measurement methods, and lack of performance data.

Comparison of ISO 9001:2008 and ISO 9001:2000

2008-11-20T12:32:00.000-08:00

This document aims to compare ISO 9001:2008 and ISO 9001:2000 to highlight changes.

The ISO 9001:2008 has been published and the standard is available through The American Society for Quality website at http://www.asq.org/. ISO 9001:2008 does not introduce any additional requirements beyond the current ISO 9001:2000. Although certification is not compulsory, it is estimated that over one million ISO 9001 certificates have been issued to organizations in private and public sectors, in manufacturing and services, and in 170 countries.

The new edition, however, will not require any specific reassessment for certification. ISO 9001:2008 will be the fourth edition of the standard which was first published in 1987. The third edition, published in 2000, represented a thorough revision, including new requirements and a sharpened customer focus, reflecting developments in quality management and experience gained since the publication of the initial version. Compared to the current 2000 edition, ISO 9001:2008 represents fine-tuning.

It introduces clarifications to the requirements in ISO 9001:2000, based on user experience over the last eight years, and changes that are intended to improve further compatibility with the ISO 14001:2004 environmental standard.

To accompany the publication of this new edition, ISO is working on implementation guidance for ISO 9001:2008, a reference table comparing and contrasting ISO 9001:2000 and ISO 9001:2008, and answers to Frequently Asked Questions.

Quality Guru Asks : What do you think of the value of this revision and will it improve your organizational effectiveness?

Benefits of an ISO 9001 Business Management System

2008-06-18T13:26:00.000-07:00

What are the benefits of having an ISO 9001 based business management system? Lets begin by looking at the benefits to your employees and the organization:

Employee Benefits
To successfully implement and maintain a quality management system, employees need to understand its value to them. The better they understand what's in it for them personally, and how the organization also benefits, the more receptive they will be to the changes and work involved to make it happen.

Employees benefit from the improved internal communication and top management support. Conformity with ISO 9001 means suitable and well maintained equipment, along with the training needed to perform their jobs. Procedures and instructions, where necessary, will be available to guide them in their activities. Employees will have a better understanding of their role in the system and their contributions to meeting objectives. This sense of order and control will carry over into clean and well-organized work areas.

Since the organization will want to continually improve the system, employees will be encouraged to report problems and suggest improvements. As a result, they will be more satisfied and committed to the business.

Organization Benefits
The result of a conforming business management system will be better planned and coordinated activities. Any problems affecting product quality are identified and effective solutions are implemented.

Using the plan* do *check* act approach will lead to more efficient and effective processes and more productive employees. Higher quality products are delivered to more satisfied customers. As a result of your ISO 9001 based system and its well-defined policies, procedures, and information, the organization will be better managed for success. And the story only gets better, because your organization and its management system will be continually improved.

Perceived Disadvantages
Although we have been discussing the very real benefits of an ISO 9001 based system, you should be prepared to deal with its perceived disadvantages

1. Difficult to implement; need a consultantISO 9001 is just a collection of good, common-sense business rules. The difficulty factor depends on the state of your current management system.

2. Organization will resist the changes if introduced properly, with clear explanations of how it will directly benefit them, your employees should become big supporters of the new system.

3. Expensive to implement and maintain. You can reduce costs by comprehensive planning and avoiding the urge to put more into the system than is required for certification. Improve from that base.

4. Significant disruption to your business. Make sure it is supported by top management as a high priority project and integral to the business; not a separate effort by the quality department.

5. Yields unwieldy, ineffective documents. Only write the essential documents. You can rely on trained, experienced employees to perform any undocumented processes.

6. Cumbersome controls and bureaucracy. Keep it simple. Only implement what the business really needs. It may actually make the organization a better place to work.

Certification Benefits
In addition to the previously covered benefits, having the actual certificate in hand provides additional benefits. ISO 9001 is the international language of quality. Certification may help your organization gain expanded access to world markets. Prospective customers may require certification as a prerequisite to bid on contracts. With the certificate in place, your organization will be ready.

The ISO 9001 certificate may differentiate your organization from others in the marketplace and provide a competitive advantage. The certification mark recognizes a quality accomplishment that you continue to earn through successful surveillance audits. Display it with pride. And, don't underestimate the value of independent system assessments by well qualified professional auditors.

Due to its prevention focus, disciplined approach, and better controls, your organization may see an extra benefit of improved housekeeping and fewer accidents. As a result, you may qualify for lower insurance premiums.

Maintaining Benefits
Your organization will see some initial gains through the improved organizational focus and internal communications. These improvements, and other benefits, will be solidified by an active internal audit program and strengthened through the management review process.

Remember, an organization can't rest on its accomplishments. A quality management system will either improve or become less effective. The system will not stay in a steady state. You must listen to customers, meet objectives, stay conforming, and continually improve.

Quality Guru Asks: (1) Tell us the reasons your company acquired registration or the reasons your organization is considering registration? (2) What tangible benefits has your company realized from registration or ask me for hard fact evidence!!

2008-03-24T14:51:00.000-07:00

Quality Guru Asks: What Methods are You and Your Company Using? What Measurable Results have you obtained, or not obtained? Share your thoughts with us!

Six Sigma, TQM, Lean?

With all the emphasis today on quality, and studies showing that quality is very important to the leaders of American business, why are so many organizations struggling to achieve and sustain quality systems? The answer is that managers have been inundated for 20 years with a parade of quality initiatives that have promised miraculous results in reducing costs and increasing profits. Consultants have peddled the promise of quality circles, self-directed teams, ISO 9001, theory of constraints (TOC), lean manufacturing, and Six Sigma to the point of near hysteria.

Each new system promises greater rewards. All of these systems have succeeded somewhere. Most have failed and died from neglect. My contention is that many managers do not have the time, knowledge, or resources for in-depth analysis of methods for process improvements. Competition has increased while pricing pressures from low cost countries have decreased profit margins. These lower profits make it extremely important that any money spent be able to show a return on the investment. A wrong decision on where to invest capital can be fatal to a company’s long-term health.

Any half-hearted implementation will probably fail, and every failure makes the next attempt even less likely to succeed. Let’s see if we can simplify the decision making.

What’s a manager to do? Here’s my list of questions to be answered by anyone looking to invest time and money in a quality-improvement system.

• Can the method be introduced to all types of business models?
• Will the method give a good return on investment?
• Is the method affordable?
• Is the method easily understood and assimilated into the company’s culture?

Let’s do a quick review of the heavy hitters in the quality arena.

Six Sigma

Six Sigma methodology involves two essential assumptions. The first is that people understand the ability of numbers to characterize a process. The second assumption is that reducing variation in a process— the cornerstone of Six Sigma—is always good. The goal of a business is to improve at the least possible cost, so the potential exists for savings to be less than the costs of the improvements. In addition, one process can be improved at the expense of another, causing the overall performance of a business to degrade.

Strengths of Six Sigma

• Projects have defined accounts to track money saved.
• Six Sigma can be used in either manufacturing or service industries.
• Because Six Sigma is driven by improvement in profitability, upper management is more likely to support it.
• Six Sigma isn’t viewed as a quality system, but a business system.
• Wall Street has become enamored of Six Sigma because of results reported by large companies. If Wall Street loves Six Sigma, business leaders have more freedom to invest capital without fear of failure.
• Six Sigma projects are intended to prevent defects before they can be created.
Weaknesses of Six Sigma
• Training costs are high. GE invested over $200 million dollars in the first year. Training a Black Belt can cost more than $40,000.
• The belt system can create a division between the “chosen ones” and everyone else.
• Turnover among trained Black Belts is high. Once trained, a Black Belt is valuable to other organizations. It may often be cheaper to hire a Black Belt than to train one.
• The cost savings reported are viewed skeptically by many, and predicted savings may not be tracked closely. Motorola reported in 1996 that it had savings of $16 billion from Six Sigma. From 1998 to 2003, Motorola gained no market share or improved stock value (Schniederman, Arthur M. (2004 March). Question: When is Six Sigma not Six Sigma, Answer: When it’s the Six Sigma Metric, posted on www.schneiderman.com). Where did the savings go? Schneiderman contends estimates don’t recognize that many costs are fixed or semi-fixed and don’t go away but show up elsewhere in the organization.
• The statistics involved are difficult for many employees to understand, and even experts cannot agree on the correct interpretation of the statistics. Try to figure out the argument about the 1.5 sigma shift and I guarantee your head will hurt!

Even if cost savings are accurately computed, eventually the big projects are completed and a cadre of highly trained specialists have fewer and smaller projects to work on, which may not justify full-time Black Belts.

Total Quality Management

Taguchi embraced the ideas of Deming and added to them. Kanbans, quality circles, just-in-time manufacturing and other concepts were combined to create the total quality control (TQC) system of continuous improvement that contributed to the rapid improvement of quality and productivity in the Japanese economy. The TQC concepts were Americanized to become TQM.
Strengths of TQM

• TQM organizations are typically flatter and Leaner than non-TQM companies
• TQM has worked in Japan, and benchmarking and training opportunities abound.
• TQM organizations are more customer-oriented than non-TQM companies.
• TQM stresses employee participation.
• TQM is adaptable to manufacturing or service industries.
Weaknesses of TQM
• TQM projects tend to focus on optimizing processes, rather than the whole system.
• TQM does not focus on bottom-line results to the extent other systems, like Six Sigma, do. Companies increasingly need to tie any investment to bottom-line improvement.
• Managers can be resistant to give up power. In a TQM organization, delegation is necessary for the system to succeed.
• Organizations may be hesitant to commit to the training necessary for employees to understand TQM concepts. Training can be viewed simply as a cost, not as an investment.
• TQM relies heavily on the team concept. Teams fail in organizations because of insufficient training and competing interests.
• Goals must be carefully established and communicated so everyone is working toward a common outcome, not individual achievement.

TQM typically seeks to optimize each process without considering the effect on the other processes in a system.

For example, if a team improves the efficiency of a piece of machining equipment by 20 percent, is that a good thing? Maybe. Improving a single piece of equipment may produce no savings at all. If the output of that equipment is waiting at the next process, inventory and waiting time have increased, and costs have actually risen. The entire process must be viewed as a whole. Many executives believe they “did quality” in the 1980s and it didn’t work. So TQM has fallen out of favor, and other initiatives, such as lean manufacturing and Six Sigma, have become more popular.

So far, neither TQM nor Six Sigma can answer our four questions with a yes. What about lean?

Lean
Lean is the reduction of waste. How do the types of waste factor into lost profitability? All waste can be classified as nonvalue-added. Nonvalue-added refers to some function or task the customer is not willing to pay for. Any overproduction uses labor, utilities, and space that might be used more profitably in other areas. Production that can’t be sold builds up inventory, and defective product is scrapped or reworked, causing lost productivity. Waiting time can never be recovered. Wasted motion is one of the most overlooked types of waste. Needless walking, turning, bending, and lifting are all nonvalue-added. Transportation waste is also often overlooked. A company that doesn’t use all its employees’ talents and ideas wastes possibly good ideas for improvement.

Extra inventory may have to be stored until it can be used. At some point in the process, the inventory has to be moved again when the next process is ready for it. To be successful in the global economy, where some countries such as China and Mexico have much lower labor rates, companies must do everything possible to cut costs and improve quality. Lean emphasizes teamwork, producing according to demand, smaller batches, quick setups, and cellular production.

Lean is the only methodology with which all four questions can be answered yes. Waste is present in all business models, whether they are service or manufacturing. Initial and ongoing training costs are low, and the concepts are easily understood. Many improvements can be made with little or no capital expenditures. Lean can be implemented on a small or grand scale. Departments from accounting to shipping can utilize lean techniques. The size of the business isn’t an issue, lean works just as well in a small business as a large one.

Six Sigma has too many negatives to be the first choice of a business as a methodology for continual improvement. Even proponents of Six Sigma admit that it’s not a good tool for small businesses. Because of the training cost and people resources required, a small company likely won’t have enough cost-reduction opportunities available to justify the investment. According to Got Six Sigma on the Brain, in the November 2004 Quality Digest, more than 66 percent of the companies using Six Sigma have more than 500 employees. In addition, the article points out that after three or four years companies abandon Six Sigma because the major cost savings have been realized. The math required in Six Sigma makes it difficult for everyone to understand the concepts. The tools of Six Sigma can be valuable for reducing variation in processes. The training to use these tools is readily available at local community colleges, on internet sites, and through other sources at much less cost than through the belt hierarchy.

Lean techniques should be investigated by any business interested in improving profitability and competitiveness. The principles translate to almost any business model. Results can be gained quickly and don’t require large expenditures at the beginning of the process. Many resources are available to gain the knowledge necessary to implement the methodology.

No one knows where the next quality guru will come from, but one thing is certain—the next “silver bullet" is just around the corner.

Article Written by Allen Huffman

"Buy American“? How about “Buy Quality” and then live up to expectations?

2007-11-06T14:01:00.000-08:00

From: Quality Digest Magazine, Nov 2007
Written by Dirk Dusharme, Editor

"Made in the USA." What does it mean? What should it mean? To tell the truth, I’ve never thought all that much about it. My inclination has always been to buy the best product, with the features that I want, at a price that I can afford. Frankly, I’ve gotten used to those products being foreign-made, to the point that I just automatically gravitate toward Honda or Bosch or Zeiss.

But this month’s cover story by Nathalie Mitard (“Made in the USA,” beginning on page 26) made me think about it. I even posed the question to my wife. I asked her, “Everything else being equal, if you had the choice to buy a U.S.-made product or a foreign product of the same quality, which would you choose?”

Without hesitation, she said, “The U.S.-made product, because it supports our economy.”

“What if the foreign product was of slightly better quality?” I asked.
“Still U.S.,” she replied.

“Is there a point at which the better quality of a foreign product would persuade you to buy foreign rather than U.S?”

She had to think about that for a bit, but then acknowledged that, sure, at some point the quality of a product wins out over origin.

So, again, what should it mean to only buy products that are “Made in the USA”? Should I buy a U.S. product out of a sort of patriotism, or should I buy a U.S. product only if it’s better? I think it’s the latter. There’s just a little bit of hypocrisy tied up with how some U.S. manufacturers want me to blindly buy domestic. They want me to “Buy American,” but they definitely don’t want their Japanese customers to “Buy Japanese” or their Mexican customers to only buy products with a “Heche en Mexico” label.

I live in the rice-growing region of Northern California. This relatively small area exports more than 40 percent of its annual rice production to Asian countries; in fact, half of Japan’s total rice imports come from here. The total value of California’s 2002 rice exports was around $183 million. The industry creates more than 5,000 rural jobs.

Can you imagine what would happen to this area if Japan decided to embark on a “Buy Japanese Rice” campaign? “Buy [country here]” sounds good except when the shoe is on your customer’s foot.

Even with all that said, Mitard is right. There’s a trade deficit and it’s partially up to us as consumers to do something about it—but we shouldn’t do it blindly. We should buy from those U.S. producers, like Mitard’s, that put out a quality product—and, I would argue, only those. The others will learn the hard way, like our consumer electronics industry did as it crumbled beneath the onslaught of better and less-expensive Japanese-made products. Some industries, like the auto industry, learned, barely, and are now producing comparable products at comparable prices.

So I agree that maybe its time that we… I… take another look at U.S. products. The next time I get ready to make a purchase, I’ll evaluate whether the U.S. product (if it exists) is of comparable quality to the foreign. If it is, well, why not “Buy American”?

This isn’t just a blind allegiance to U.S. products, but rather an allegiance to quality U.S. products. So how about this? Let’s change the slogan from “Buy American” to “Buy Quality.” If we do that, eventually the “Made in the USA” label will mean more than just the place of manufacture.

QUALITY GURU IS ASKING FOR YOUR OPINION
We all know that many U.S. consumer products are made in other countries (example - no such thing as a Made in America automobile anymore). Does "Made in the USA" determine your buying experience or do you purchase solely on the best quality and price available?

Share your thoughts and purchasing decision process!

2007-08-03T14:20:00.000-07:00

Internal Auditing: A Tool for Effective Process Mapping

Internal audits are often scheduled, and therefore conducted according to the ISO 9001:2000 clause structure. Most organizational audit systems start with a formalized checklist where auditors ask questions to ensure employees know their jobs, check for available procedures, and determine if documents and records are being utilized. These audits are mostly focused on judging conformity than evaluating effectiveness. Looking clause by clause, the quality management system may appear conforming, yet be fragmented and ineffective.

Auditors must adopt the process approach and assess the quality management and operational system through its natural workflow. Of course, this requires understanding the business, its processes and the integration of linkages that drives effective auditing and process mapping. Audit planning and interviews should identify for each process:

• Inputs: What, when, and from whom?
• Resources: With what people, materials, equipment?
• Methods: How done (procedures and instructions)?
• Controls: How monitored and controlled?
• Measures: What are performance indicators?
• Outputs: What is delivered, when, and to whom?

Auditors should view the quality management system as a set of integrated processes (by understanding the interfaces and interactions). Adopt the process approach for your audits. Add value by looking at more than just conformity. Evaluate the linked processes for their “effectiveness”. Verify their controls and identify any process risks. Also, determine opportunities for improvement. Auditors can promote the process approach through their own audit methods.

Share with us and our readers what method you and your company use to identify and document the Six "Process Based" outcomes identified above.

We will post all examples and discuss best practices next month!

Effective Procedure Writing

2007-05-22T16:46:00.000-07:00

When writing a procedure, keep in mind these questions:

• What is the objective of process? Know its purpose before starting.
• Which activities are part of scope? Agree on coverage of activities.
• Who is responsible for these activities? Identify key process players.
• What are inputs and who are suppliers? Identify inputs and providers.
• What are outputs and who are customers? Identify outputs and recipients.
• What is referenced as an information source? Identify related documents.
• What is the logical series of steps? Organize the steps in a logical sequence.
• How are the activities performed? Interview users and observe operations.
• Which departments use the process? Know readers and users of the process.
• What reports or records are generated? Identify records for the process.
• What forms are used? Don’t overlook forms used to collect information.
• When and where is the work performed? Identify timing and location
of work.
• What products are covered by the process? Define its applicability.
• What process documentation already exists? See if documents can be adapted.
• What are the requirements of the process? Know user and organization needs.
• What are the quality criteria? Identify the acceptance criteria.
• What are the related procedures? Ensure compatibility with other processes.
• Which tasks have or need instructions? Add or refer to needed instructions.
• How might the process be audited? Be able to demonstrate conformity.

2007-04-23T16:31:00.000-07:00

Receive A Tax Deduction for ISO 9001

The Internal Revenue Service issued a ruling in 2000 that allows businesses to take a tax deduction for the costs of implementing and maintaining ISO 9001 registration. Several organizations had petitioned the IRS to permit firms to deduct ISO 9001-related costs in a single year instead of spreading the expenses over several years. The IRS ruling stated, "Although ISO 9000 is voluntary, it increasingly is a contractual requirement for doing business with many organizations, both public and private, worldwide." A prior unofficial IRS position paper had concluded all ISO 9000 costs had to be capitalized over a three year period.

The costs of ISO 9001 are now viewed as satisfying the conditions for applying section 162 of the Income Tax Regulations: it is an expense, ordinary, necessary, paid or incurred during the tax year, and made to carry out a trade or business. The ruling that ISO 9001 registration is necessary was, in part, responsible for this policy change. "ISO 9000 certification does not itself result in the creation of an asset having a useful life substantially beyond the taxable year," according to the IRS ruling.

For more information, see: Internal Revenue Bulletin 2000–4. It states, “Cost incurred by a taxpayer to obtain, maintain, and renew ISO 9000 certification are deductible as ordinary and necessary business expenses under section 162 of the Code, except to the extent they result in the creation or acquisition of an asset having a useful life substantially beyond the taxable year (e.g., a quality manual).”

In addition, see: Internal Revenue Bulletin 2004- 7. It states in Example 4 for business process certification, “Z corporation, a manufacturer, seeks to obtain a certification that its quality control standards meet a series of international standards known as ISO 9000. Z pays $50,000 to an independent registrar to obtain a certification from the registrar that Z’s quality management system conforms to the ISO 9000 standard. Z’s payment is an amount paid to obtain a certification of Z’s business processes and is not required to be capitalized under this paragraph (d) (4).”

2007-01-08T13:01:00.000-08:00

Quality Systems 2006 Customer Satisfaction Results

The Independent Association of Accredited Registrars (IAAR) is an association of accredited management system registrars operating in North America. The data results of their satisfaction survey cover reasons for implementation, benefits, ROI, and other important QMS metrics.

When asked if their present certification had been a positive experience, 96% responded with Yes. More than 2,500 customers responded to questions such as:

What internal benefits have you realized from your current quality management system?

Reduced scrap/rework costs - 728 Yes Responses
Increased efficiency - 936 Yes Responses
Greater quality awareness - 1,861 Yes Responses
Positive cultural change - 845 Yes Responses
Enhanced communications - 880 Yes Responses
Better documentation - 1,869 Yes Responses
Improved customer satisfaction - 1,391 Yes Responses
Competitive advantage - 922 Yes Responses

What benefits has your organization gained? Let us
know and we will publish the results next
month.
To see the complete survey results go to IAAR Website

2006-11-17T08:04:00.001-08:00

In Search of the Perfect Process

In an article in 6L, a journal for Six Sigma and Lean Manufacturing professionals, Jim Womack states, "Unless you have defined from the customer's perspective what specific value is required, it is premature to begin thinking about building or improving processes to deliver it." Womack defines a perfect process as one that is:

1. Valuable
2. Capable
3. Available
4. Adequate
5. Flexible

The perfect process is valuable because it creates and adds value for customers. Start by drawing a Value-Stream Map to visualize the process. Then remove the non-value-adding steps. Don't begin by asking if a process step is valuable. First, see if the step is even needed. In other words, would the customer miss it? If the answer is "no", don't try to fix it, just eliminate it.

A capable process performs the same way with the same result every time. Improving the capability of a process is the starting place of Six Sigma. An available process can be performed every time it needs to be performed and in the standard cycle time. Availability depends on equipment reliability and uptime; therefore, it is the starting place for Total Productive Maintenance.

An adequate process has enough capacity to perform every time when it needs to be performed, without waiting. This is the concern of Theory of Constraints, Right-sized Tooling, and Lean Manufacturing System Design.

A flexible process can change over quickly from one member of a product family to another one. Perfect processes have very low setup and changeover times. These flexible processes allow small amounts of parts for different products to be made frequently, resulting in high throughput and low inventory. This is the concern of the Toyota Production System.

In addition to being valuable, capable, available, adequate, and flexible, a perfect process also has its steps linked and coordinated by:

1. Continuous flow,
2. Customer pull, and
3. Leveled production.

Continuous flow is the quickest way to get materials from point A to point B, while allowing customers to pull products out of the value stream to prevent the waste of overproduction. Leveling the volume and mix of product flow through the process permits a steady consumption of resources and minimizes the work-in-process inventories associated with batch-and-queue production.

Womack says a perfect process is waste-free. Every step is completely valuable, perfectly capable, perfectly available, exactly adequate, and highly flexible. And, every step is connected by continuous flow, noiseless pull, and maximal leveling.

Adding Value & How's Your Customer Support System?

2006-09-05T15:17:00.000-07:00

What do we mean by “Adding Value?”

We hear so much about the importance of “adding value” to our processes and during quality management system audits. In principle, each of us contributes in some manner or form adding value, but this is not always the case. Occasionally, it is unclear whether an event adds value. Here are three useful tests:
• Does the event physically transform the product in some way? If so, it probably adds value.
• If the customer observed the event, would he balk at paying its cost? If so, the event probably does not add value.
• If the event were eliminated, would the customer know the difference? If not, the event is probably non value added.

There are several dictionary definitions of “value” but all focus on the concept of something being useful. “Adding Value” therefore means to make something more useful. Some organizations have used ISO 9001:2000 to develop a quality and operational system that is integrated into the way they do business, and is useful in helping them achieve the strategic objectives of the business. Conversely, other organizations have created a bureaucratic set of procedures and records that do not reflect the way the organization actually functions and simply adds costs, without being useful. This does not add value. Let’s look at two different approaches:
• A non-value added approach asks, “What procedures do we have to write to get the ISO9001:2000 certification?”
• A value added approach asks, “How can we use our ISO 9001:2000 based quality management system to help us to improve our business and enhance customer satisfaction?”

Our experience has shown that the approach an organization takes to “adding value” is likely a function of the level of maturity of the organization’s quality culture and the maturity of its quality management system in respect to the requirements of the ISO 9001:2000 Standard. It is important to define that in this context:

The Quality Guru refers to "Quality culture” as to the degree of awareness, management commitment, and overall collective behavior of the organization with regard to its quality and operational performance success.

What do you and/or your organization use to identify a "Quality Culture" Let me know and I will post your comments in our October Newsletter.

How's Your Customer Support System?

In a recent issue of "Quality Insider" readers were asked: "Most of us have to call a customer support number at some time. Usually, that number connects to an automated attendant that steps you through a phone tree before connecting you to an actual humanoid. How often do you find yourself either lost in the phone tree or connected to the wrong customer support department?" Here are the results:

•0 percent of the time (I never have problems with automated attendants.)4.4%
•25 percent of the time 35.6%
•50 percent of the time 33.7%
•75 percent of the time 21.6%
•100 percent of the time (I always have problems with automated attendants.)4.7%

Are you losing customers based upon your customer support system? Let us know what your customers would say!

What Do YOU Think About This?

2006-05-10T08:44:00.000-07:00

Quality Digest Survey Results:

Can Six Sigma be overused?

• Yes 72.3%

• It depends 15.8%

• No 11.9%

Does Six Sigma lead to tunnel vision?

• Yes 43.8%

• It depends 35.5%

• No 20.7%

Other comments included:

• "It depends on the individual, not Six Sigma tools or methodology."

• "It depends on the ultimate understanding that the movers and shakers for Six Sigma have within the company. One must always look at the whole picture and not just the immediate incident/report."

• "Users need to be careful not to focus too heavily on cost reduction and lose site of product quality. A certain amount of common sense and good judgement have to be applied to all projects."

• "We can get hung up on the financial returns projects and ignore the just-do-it projects."

• "Overused? No. Wrongly applied? Yes. Not every problem needs or lends itself to a DMAIC project. And tunnel vision, like beauty, is in the eye of the beholder."

Reasons Why You Know You Need A Formal Process Improvement Structure

2006-04-18T07:55:00.000-07:00

1. Fragmented processes causing delays and defects: Firefighting versus Fire Prevention. The focus must be preventing defects, errors, and mistakes.

2. Customer Complaints: For every customer that complains about your product or service, there are 16 more that won’t tell you directly. Word of mouth can kill you!

3. Supplier Complaints: Do your suppliers complain about the last minute delays imposed on them?

4. Employee’s Whining: What’s stopping your employees from doing a good job? “I could do my job better if ____”.

5. Blaming People: The problems are in your processes, not your people. Six Sigma is process focused.

6. Knee jerk Reactions: Managing by Gut feelings. “We’ve always done it this way”. Data driven methods create improvements.

7. Margins are low, expenses are high, and our growth is stalled: Defects and delays eat away at profits, and lack of a strategic focus inflates expenses.

8. Field failures: How many customer service personnel do you have? How large is your warranty and repair efforts?

9. Too many inspectors: You cannot inspect quality in, but you can build it in.

10. Absenteeism and turnover: Employees don’t want to do a bad job. Are your internal systems preventing your employees from doing a good job?

Who was the ORIGINAL Quality Guru?

2006-04-10T20:56:00.000-07:00

W. Edwards Deming

Dr. Deming is the ultimate of the quality gurus. He developed, implemented, and made work many of the ideas that we currently use in quality. The story of his going to Japan and teaching the Japanese about quality has become legend. But, what did he teach? What are the nuggets of information we should remember?

The first of his teachings is the fourteen points of quality management:

1. Create constancy of purpose toward improvement of product and service, with the aim to become competitive and to stay in business, and to provide jobs.

2. Adopt the new philosophy. We are in a new economic age. Western management must awaken to the challenge must learn their responsibilities, and take on leadership for change.

3. Cease dependence on inspection to achieve quality. Eliminate the need for inspection on a mass basis by building quality into the product in the first place.

4. End the practice of awarding business on the basis of price tag. Instead, minimize total cost. Move toward a single supplier for any one item, on a long-term relationship of loyalty and trust.

5. Improve constantly and forever the system of production and service, to improve quality and productivity, and thus constantly decrease costs.

6. Institute training on the job.

7. Institute leadership. The aim of supervision should be to help people and machines and gadgets to do a better job. Supervision of management is in need of overhaul, as well as supervision of production workers.

8. Drive out fear, so that everyone may work effectively for the company.

9. Break down barriers between departments.

10. Eliminate slogans, exhortations, and targets for the work force asking for zero defects and new levels of productivity. Such exhortations only create adversarial relationships, as the bulk of the causes of low quality and low productivity belong to the system and thus lie beyond the power of the work force.

11. a. Eliminate work standards on the factory floor. b. Eliminate management by objective.

12. a. Remove barriers that rob the hourly worker ofhis right to pride of workmanship. b. Remove barriers that rob people in management and in engineering of their right to pride of workmanship.

13. Institute a vigorous program of education and self-improvement.

14. Put everybody in the company to work to accomplish the transformation. The transformation is everyone's job one

The second of his nuggets of information is his seven deadly diseases:

1. Lack of constancy of purpose to plan product and service that will have a market and keep the company in business, and provide jobs.

2. Emphasis on short term profits.

3. Evaluation of performance, merit rating, or annual review.

4. Mobility of management; job hopping.

5. Management by use only of visible figures, with little or no consideration of figures that are unknown or unknowable.

6. Excessive medical costs.

7. Excessive costs of liability.

A Ten Step Method To Continuous Improvement

2006-04-10T20:32:00.000-07:00

A Ten Step Method To Continuous Improvement

Continual improvement is a type of change that is focused on increasing the effectiveness and/or efficiency of an organization to fulfill its policies and objectives. It is not limited to quality initiatives. Improvement in business strategy, business results, and customer, employee, and supplier business relationships can be subject to continual improvement. Putting it simply, it means getting better all the time'. Continual improvement should focus on enablers such as leadership, communication, resources, organization structure, people, and processes - in other words, everything in the organization, in all functions at all levels. Continual improvement should also lead to better results, such as, price, cost, productivity, time to market, delivery, responsiveness, profit, and customer and employee satisfaction. There has been a tendency in total quality management programs to focus on departmental improvements which do not improve business results overall. Departmental improvements may merely move the constraints or problem somewhere else in the process chain.

What continual improvement is not:
Improvement is not about using a set of tools and techniques. Improvement is not going through the motions of organizing improvement teams and training people. Improvement is a result, so it can only be claimed after there has been a beneficial change in an organization's performance.

Gradual, incremental, or breakthrough?
Continuous improvement is gradual never-ending change, whereas continual improvement is incremental change. Both types of improvements are what the Japanese call Kaizen. In the United States, Lean and Six Sigma improvement is common place. Breakthroughs are improvements, but in one giant leap - a step change. However, the method of achievement is the same, but breakthroughs tend to arise out of chance discoveries and could take years before being made.

When should continual improvement be started?
All managerial activity is directed either at control or at improvement. Managers are either devoting their efforts at maintaining performance, preventing change, or creating change, breakthrough, or improvement. If businesses stand still, they will lose their competitive edge, so improvements must be made to keep pace and stay in business. Every system, program, or project should provide for an improvement cycle. Therefore, when an objective has been achieved, work should commence on identifying what is meeting the requirements of the process, and what better ways of doing it.
There is no improvement without measurement. An organization must establish current performance before embarking on any improvement. If it does not, it will have no baseline from which to determine efforts.

There are ten steps to undertaking continual improvement:
1. Determine current performance.
2. Establish a need to improve.
3. Obtain commitment and define the improvement objective.
4. Organize the diagnostic resources.
5. Carry out research and analysis to discover the cause of current performance.
6. Define and test solutions that will accomplish the improvement objective.
7. Produce improvement plans which specify how and by whom the changes will be implemented.
8. Identify and overcome any resistance to the change.
9. Implement the change.
10. Put in place controls to hold new levels of performance, and repeat step one.

Where do the ideas come from?
If the organization has identified its critical success factors (that handful of things at which it must be supremely good in order to succeed), then focusing the attention of the continual improvement process onto one or more of these for a defined period might give rise to major improvements. No one in the organization, from top to bottom, is exempt from the responsibility for improvement. It is a normal component of all employees' jobs to search out ways of improving performance. Furthermore, no one in the organization can be expected to do this without help and the necessary support.

What tools should be used?
The portfolio of tools used for continual improvement should be those which enable an organization to execute the ten steps above. These can include:

• Ishikawa fishbone diagram to examine cause and effect
• Failure mode and effects analysis to predict failure and prevent its occurrence
• Pareto analysis to identify the few influences on a situation which have the biggest impact
• Force field diagram to display the forces for and against change
• Charting techniques to demonstrate whether improvement is being achieved

Continual improvement is far more than a set of techniques.
For many organizations, it involves a radical change in attitudes. The defense of the status quo, and resistance to innovation, cannot be treated as normal management behavior. A fear of reprisals for reporting problems has to be replaced by congratulating people for identifying an opportunity to improve. Hoarding of good ideas within departmental walls must be a thing of the past as people share their knowledge and experience in the search for greater collective success. The importance of commitment
Continual improvement is about the entire organization and everything it does. It has to be a prime concern of executive management and its success depends upon commitment from the top. The commitment must also be highly visible. It is not enough to have a quality policy signed by the chief executive. If executive management does not demonstrate its commitment by doing what it says it will do, they cannot expect others to be committed.

Reward success !
The encouragement of people who have initiated improvements, however small, is an important component. This can be done in many ways, from displays on special improvement notice boards to the awarding of prizes. This is an area in which the culture and style of the organization has to be considered. The sudden introduction of a show business style into a staid environment may lead to cynicism rather than effective promotion of success.

Welcome To QualityGuru.Com

2006-04-06T12:44:00.000-07:00

This is the online home of "The Quality Guru". We will be discussing all things related to Quality Management Systems such as ISO, Six Sigma, Lean Manufacturing, Continuous Improvement, etc...

I promise there will be no "fluffy the kitty" blog posts... just informative and occaisionally opinionated articles, rants, and raves.

Who is "The Quality Guru"? A mild mannered management consultant by day, but a caped-quality-crusader by night!