The House of High Quality Articles for Everyone in the World

Mar 31, 2010

What is Quality?

When we talk with business owners about their company vision and values, we often hear them speak about quality. They say things like:

"We offer quality products"
"Quality is important to us"

When I ask them what they mean by the word "quality," they say quality means that they work the first time they're used. To others, quality refers to flawless workmanship in installation or using cost effective materials that stand up over time.

Reasonable companies don't set out to sell products that don't work, don't fit, or fall apart during the first year of (normal) use. Warranties are supposed to make us consumers feel assured that manufacturers stand behind their work.

So what does "quality" really mean? Quality can be defined as fitness for use, meeting customer satisfaction, and freedom from deficiencies (1).

Juran defines quality as satisfying customers through quality of design and quality of conformance (2).

Quality of design centers around meeting the changing needs of customers and markets. These include product features and options as well as service offerings. We know that consumer tastes change over time and demand can be fickle. Just look at the evolution of the cellular phone market. There was a time when we were just happy to have cordless mobile phones so we could make calls while on the go. Now we have features such as text messaging, calendars, ring-tone selections, speakerphones, cameras, and tip calculators that used to be options but are now capabilities included in about all cell phone offerings. More recent options include internet access, music downloads, and a myriad of applications. It's an ever-evolving list.

Quality of conformance requires a reduction in scrap, customer warranty claims and complaints, rework, repairs and other costs associated with failures. Freedom from deficiencies can result in significant reduction in costs. Cost reductions can mean more profit for the producer and/or lower sales prices for the customer.

Rework is expensive whether we're talking about re-machining a component that doesn't fit, troubleshooting a circuit that didn't work right, repairing broken web site links or fixing spelling errors in a marketing brochure that went to print. The service provider eats these costs and the customer is quite likely to become unhappy if there are on-going or recurring problems. Customers don't like to be the ones to find errors and problems in their purchases. And when there's a broad-scale manufacturer recall, everyone takes a hit in cost, convenience, and confidence: witness the auto industry and, by way of continuous "critical updates and service packs," the software industry.

On a personal note, my dishwasher has lasted for over 16 years. It's never been a problem appliance for me. Are there faster, quieter machines out there with more capacity? Sure. But I have no complaints for what I paid for it. On the other hand, the connector on my cell phone car charger cable broke apart after one year. Am I happy? No. Why should something that I don't use that often fall apart under normal use after one year? Whether this is a design or manufacturing defect or one of those "random, low-probability of occurrence" situations, I couldn't say. The phone seller replaced the charger cable at no charge to me, which is what I would have expected them to do but my impression of their charger quality is poor.

So in the end, quality is about what the customer wants and expects and how your business, as the product or service provider, delivers on that. I recall an old adage from my days as a design engineer - you can't inspect in quality, you need to design it in. In other words, you can't rely on inspections to catch failure-prone design problems. If your system for developing and delivering products or services is flawed, inspections or reviews won't catch every defect. In my opinion, your best bet is to have a solid, reliable way to ensure that you understand customer wants and expectations and be able to deliver on those. That's quality.

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Mar 28, 2010

Total Quality Management

TQM is a total quality management system. Based on practical experiences and people have a technique instructing how to improve the performance quality of the work.

According to ISO 9000, "Total Quality Management (TQM) is a management approach that aims for long-term success by focusing on customer satisfaction. TQM is based on the participation of all members of an organization in improving processes, products, services, and the culture in which they work."

According to Histoshi Kume, "TQM is a management method to success. It creates proper conditions for the sustainable development of the organization by directing all the employees' effort to create an economic quality pursuant to the customer's request".

The goal of TQM is to help producing a good quality product as well as lowing the cost, improving the productivity, shortening the delivery time. This also means that TQM aims for the 3P: (1) Performance (2) Price and (3) Punctuality of the quality of the product by the effort of all the member of the organization.

In general, TQM is a set of principles for improving the quality by encouraging all the direct and indirect employees in improving processes, products, services, and the culture.

These principles generally are:

1- It is the customers who set the quality standards for the product and their needs are absolute.
2- The highest level manager of the company must be the person who follows the quality standards.
3- Quality is a strategic matter and must be the priority to consider in plan making.
4- Quality is the problem of all the people of all levels and departments in the company and everyone must cooperate to solve this problem.
5- Functions of the company must focus on the Continuous Quality Improvement to reach the strategic goals of the company.

The problem solving and continuous quality improvement are based on the Statistic Quality Control method (SQC) and the use of the Deming Cycle.

The basic technique of TQM include:

o Quality control Circle
o 7 basic quality tools to control and improve the quality
o Kaizen (quality management theory by a Japanese)
o 5S (house keeping)
o QC story (Quality Control story) )
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Lean Manufacturing Tools

To build a lean manufacturing process you need alot of techniques and tools covering everything from quality control to the layout of facility.
The following tools and techniques form the focus of sound lean manufacturing process.

1- 5S – 5S is a lean manufacturing tool often used at the start of a lean manufacturing improvement process to optimise the workplace and ensure a safe working environment. Without 5S you can not build lean manufacturing.

2- Buffer and Safety Stock – Buffer stock is used to smooth out variations in the internal processes of the organization ensuring that these variations do not affect the customer. Safety stock is used to hedge against disruptions in the manufacturing process.

3- Cellular Layout – A tool used to maximize the efficiency, flexibility of the physical layout of each work station and minimize move distance.

4- Continuous Flow – Allows the movement of products through the value system without waste or inventory.

5- Cycle Time – A measurement of the time taken to complete a process and used to determine the number of operations required.

6- Heijunka – Also referred to as load levelling, a tool used to allow an organization to meet variations in the level of customer demand.

7- Just In Time (JIT) – An inventory strategy that reduces the need for in-process inventory.

8- Kaizen – A process of continuous improvement throughout business processes.

9- Kanban – A process of continuous supply of parts and supplies so that operatives have what they need when they need it.

10- Metrics – A way of measuring, evaluating, and responding to manufacturing performance without sacrificing quality or increasing inventory levels in an effort to achieve efficiencies in production.

11-Line Balancing/Level Load – The distribution of the work required to assemble a product across a set of work stations.

12- Mistake Proofing – Also referred to as Poka Yoke, involves simple methods for eliminating errors in business processes.

13- Quick Changeover – The ability to change tooling rapidly so that multiple products can be developed on a single machine.

14- Standard Work – A definition of the most efficient methods for producing a product using the available equipment, materials and people.

15- Takt Time – A measurement of the maximum time required to produce one unit of a product and often used as a target for the pace of production in lean manufacturing.

16- TPM - Total Productive Maintenance – A system of ensuring ‘zero-downtime’ of equipment, emphasising production operator involvement in equipment maintenance.

17- Value Stream Mapping – A lean technique used to track the flow of materials and/or information required to deliver a product to the end customer.

Waste – Defined as anything that does not add value to the process.

Needless to say, there are a wide variety of six sigma and lean tools and techniques available. This broad selection of improvement methods ensures that, whatever your business situation, there are options available to suit your needs and help you achieve your business improvement goals.
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Mar 26, 2010

What is Value Stream Mapping

Value stream mapping is often used at the outset of a lean program to identify the current process within an organization. Strictly speaking Value stream mapping is used to map information and materials through a production process – but it can be used for so much more than simply transcribing the process. So what are it’s benefits?

1/ It’s quick and easy to learn

2/ It helps portray the process from the start of the production process to the end

3/ It help finds bottlenecks

4/ It helps find waste within the process

5/ It’s a group excersise and therefore can involve your workforce as part of your lean improvement program

6/ You can use a completed value stream map as an improvement aide to document transitions to a future state value stream map

7/ Its an inexpensive tool – all you need is a paper and pen!

8/ It can be easily critiqued by your workforce (using post it notes) to highlight problems that exist within the process

9/ It’s not just for manufacturing! Value stream mapping has been used in offices, service industries healthcare etc.

10/ It’s easy to understand – With a little bit of training on VSM icons – maps are easy to understand conveying powerfull process in a simple pictorial fashion.

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Total Quality Management Characteristics

TQM is a method of quality management involving many levels of different functions, but requiring an integrated cooperation. Characteristics of TQM can be listed as follows:

1. Target:

In TQM, the most important target to achieve is Quality; Quality policy must be set toward customer. Meeting customer's requirements but not trying to reach some quality standards set before. Never stop innovating - never stop perfecting the quality is one of the most important principles of TQM.

2. Scope:

To ensure the quality of service and product, TQM system requires the extending of production process to suppliers and sub-contractors. Normally, the trading of material in production may account for 70% of final product cost (depend on types of product). Therefore, to ensure the quality of the input material, it is necessary to set up specific standards for each type of material to control its quality. It is also necessary to change the method of placing order to make it suitable with the production process.

3. Form:

In stead of controlling the quality of the finished product (after production), TQM sets up plans and programs to supervise and prevent problems right before the production process. Statistical tools are used to supervise, quantitatively analyze the results as well as factors affecting the quality, consider the reasons and take appropriate prevention methods.

4. Basis of TQM system:

The basis of TQM practice in the company is Human. Talking about quality, people usually think about the product quality. But it is the quality of employees that is the main concern of TQM. Of the three factors of Business, which are hard factor (machines, equipments, money...), Soft factor (methods, secrets, information...) and Human factor, Human is of the first concern to TQM.

The basic principle for implementation of TQM is that the qualification of employees is developed fully and integratedly through training, delegation and assignment.

5. Organization:

TQM system is cross organized and functioned in order to manage, integratedly corporate with different activities of the system and facilitate group working. The implementation of TQM requires the participation of high and middle level managers. A proper organization will help duties to be assigned clearly. Thus, TQM needs new management model, with different characteristics from the previous model.

6. Management skills and tools:

Methods to implement must be based on the principle "do correctly at the very beginning", in researching and designing to minimize economic cost. Strictly apply DEMMING circle (PDCA) to make foundation for the continuous quality improvement.
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Mar 25, 2010

Comparison Between ISO 9001-2008 Vs ISO 9001-2000

ISO 9001: 2008 is really an exciting moment for quality managers. In order to celebrate this event in a way that only quality managers know how, I prepared here a comparison between the ISO 9001:2000 and the ISO 9001:2008.

Paragraph number 0.1 - Changes here are a statement about whom and where the standard includes any statutory requirements. Statutory requirement (of any kind) has the same scale as any customer or regulatory requirements. It's also clarified that these requirements are restricted to those applicable to the product.

Paragraph number 0.4 - There is a comment that state that the new standard is made due consideration to ISO 14001:2004.

There is a big correlation between the ISO 14001:2004 & ISO 9001. They actually support one another. It would be easier for organization to obtain the ISO standard 14001 requirements if it has been already certified for ISO 9001.

Paragraph number 1.1 & 1.2 - Statutory requirements had been referred in relation with purchased products and product realization. Second note explains that a statutory requirement can be a legal requirement.

My comment - After so many years of auditions the long last debate had been settled. Statutory legal requirements and regulatory requirements are applicable to the purchasing processes as well. It was always an open area that no one had the exact answer: Does your supplier must follow the law or not? Apparently yes.

Paragraph number 2 - Normative reference - the ISO 9000 is now replaced by ISO 9000:2005.

Paragraph number 3 - The explanations about what is a customer and what is an organization and what is a supplier had been removed.

Paragraph number 4.1 - Clause a - The word "determine" replaces the word "identify". A note had been added stating that a purchased processes are regarded as purchasing products. Another note had been added demanding that these processes would be controlled as well as products.

My comment - When identifying, you are required to search and find something according to the requirement. When determining, the responsibility of the results is in your hands...

It was obvious before.... Sometime they feel a need to state the obvious.

Paragraph number 4.2.1 - Slight change of words, but when you examine the change you realize the meaning remains same.

Note 2 was changed: A single document may include requirements for more than one procedure. Requirements of one procedure may appear in more than one document.

My comment - It's about time. A lot of headaches are vowed to be save. If your auditor was one of the old schools and demanded everything by the book, you had troubles. Now you may document two quality requirements on one document: Job description and trainings, for example. Or you can split one record into two documents. However it is suitable for you as long as you achieve the requirements.

A good example is that it is possible to combine the corrective and the preventive procedures together. As long as you maintain the requirements...

Paragraph number 4.2.3 - Paragraph f - A clarification that external documentation is considered while it is part of the quality management system.

My comment - When an external document is part of your quality management system, it is required to be included under the quality procedures: documents control and records control.

Paragraph number 5.1 - Clause a - the word "statutory" had been added.

Paragraph number 5.5.2 - An additional requirement that the management representative would be a member of the organization's management.

My comment - That addition puts all external consultants at risk - you can no longer be the management representative. That sets a whole new line of form and documentations for you to develop in order that the external consultants would be considered as a management representative. All external consultants would have to be creative on this one.

Paragraph number 6.2 - Change of words from "affecting product quality" to "affecting conformity to product requirements"

Paragraph number 6.2.2 - Clause b -"provide training or take other actions to satisfy these needs" changed to "where applicable training needs to be provided to achieve the necessary competence"

Clause c - you must ensure that the training is with competence rather than if it was an effective training.

My comment - It all goes back to defining .You defined what is necessary now you must provide it - nothing is new. On one hand it is an improvement. The training must be reviewed before for its competence to the requirements. But we are still on this one. We think: instead of testing your employees if they got anything out of the training you must now review the training itself before or maybe both.... Only time will tell...

Paragraph number 6.3 - Clause c - information systems are included.

My comment - They are totally right!

Paragraph number 6.4 - A new note: noise, humidity, temperatures are part of a working environment.

My comment - That also puts an old debate aside. No longer can cruel owners of factories ignore these factors. Wait until they will combine the OHSAS 18001 Standard...

Paragraph number 7.1 - Clause c - measurement had been added to the product acceptance activities.

Paragraph number 7.2.1 - Clause a - change of words - not of the meaning.

Clause c - the word 'applicable' replaces 'related'. Change of words - not of the meaning.

Clause d - change of words - not of meaning.

A note had been added to explain the meaning of "post delivery activities".

My comment - I agree with the "post delivery activities" - it wasn't clear enough for our opinion.

Paragraph number 7.3.1 - A note had been added clarifying that design review, verification and validation are separated processes but they might be conducted together.

Paragraph number 7.3.3 - A change of words. A note had been added clarifying the inclusion of "preservation of product".

My comment - The preservation of the product is to be included now in the design and the development outputs.

Paragraph number 7.5.3 - A requirement had been added regarding the measurements and test status must be identified throughout the product realization.

My comment - This requirement so far was required in standards such as ISO 13485 Standard for medical devices and the ISO/TS 16949 for the automobile industry. The requirement assures you that the inspection activities are defined maintained and recorded and so is the product's status.

Paragraph number 7.5.4 - A change of words in the requirement to inform the customer of any problem regarding his property.

The note had been amended that also personal data is included as customer's property.

Paragraph number 7.5.5 - A change of words:

"devices" in the title was changed to "equipment"

"conformity of" to "in order to maintain conformity to requirements".

Reference to paragraph 7.1 was removed

Paragraph number 7.6 - A change of words:

from "devices" to "equipment".

The reference to paragraph 7.2.1 had been removed.

Clause c - from "be identified to enable the"

to" identification to enable their".

Changes in the notes:

Note 1 - the reference to ISO 100012-2 had been removed.

Note 3 - explanation about when configuration of computer must be applied when the computer is used for monitor and measurements processes.

My comment - That means that from now on, a computers that provides any kind of measurements services, is considered as a monitoring and measuring device. And when the computer configuration has been changed - the software is required to be calibrated again.

How can one calibrate a computer? Ask your supplier or your system administrator. They will know better than anyone. But you would have to prove it has been done and present evidences.

Paragraph number 8.2.1 - A note had been added to suggest some means of conducting customer satisfaction evaluation.

Paragraph number 8.2.2- Requirements for the audit evidence and results had been added.

Requirements for the management responsibility had been added - The management is responsible for ensuring preventive and corrective action to be taken.

The reference to the ISO 10011 is changed to ISO 19011.

My comment - As I see it, that means an addition within the Management Responsibility procedure or the Internal audit procedure about management ensuring that preventive and corrective actions would be taken according to the results and decisions of the internal audit and a reference to the validation and verification.

Take a look at the next web site that provides you with prepared solutions for internal audit procedure

Paragraph number 8.2.3 - A change of words:

"to ensure conformity of the product" had been removed.

A note had been added to clarify that the organization should determine the type of the monitoring and measuring according to the processes and how will this affect the quality management system.

Paragraph number 8.2.4 - A change of word: "maintain evidence of conformity with acceptance criteria" had been removed but it is still a requirement.

Paragraph number 8.3 - An addition: Clause d - specify how to deal with a nonconforming product that was discovered after delivery - but actually there nothing new only that they moved it to a new clause.

So, what are the new requirements of the new standard?

Statutory requirements are given scale as any other legal or customer's requirements.
The statutory requirements include the suppliers as well.
A purchased process is just like any other product that the organization purchased. If it's affecting the product it must be under the quality management system.
You may include two quality processes in one document and split one process into two documents.
The management representative must be a member of the top management.
A requirement to ensure that trainings are suitable for the product in advance and not to examine whether the training was effective after it was taken.
Information system is now officially considered as a substructure.
Parameters such as humidity, noise and temperatures, concerning the employees' health are considered as working environment.
Measuring is considered as one of the activities of product realization. The product realization process shall include references to the inspection activities and the status of the product throughout the realization processes.
The product realization process shall include references to the inspection activities and the status of the product throughout the realization processes.
Software configuration is a reason for re-calibrating the software.
The management is now responsible for preventive and corrective actions regarding nonconformities that were revealed during internal audits.
The organization should determine the type of the monitoring and measuring according to the processes and indicate how this would affect the quality management system.


Most of the changes made here are really minor and are assistance for understanding open issues. I excepted a bit more of new standard but I am satisfied. The objective was not to create any earth qaukes in the quality industry but to keep update with changes in technology and to update the feedbacks and responses that were gathered over the last years. I am lucky . I already thought that all my articles in our website should be changed...
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Mar 23, 2010

an ISO 9001 Quality Management System

ISO 9001 certification will almost certainly enhance an organization's reputation. The ISO 9001 standard requires the implementation of a documented quality management system to facilitate enhanced performance and efficiency.
ISO 9001 certification is intended for any organization regardless of size, type or product including service. According to the ISO 9001 standard there are a number of system requirements which an organization needs to fulfill in order meet customer requirements. Ensuring customer satisfaction through the quality management system is a key aim of the standard. The ISO 9001 standard also includes elements that require monitoring and measurement of processes and continual improvement.

In order to achieve certification an organization should have a documented quality management system and not a system of documents. The three main objectives of the documentation should be for communication of information, evidence of conformity and knowledge sharing. Quality management system documentation may be in any form or type of medium such as paper, electronic or picture. A compliant quality management system will need to address key elements of the standard. There are five sections that outline the requirements of a compliant system, section 4 Quality Management System, section 5 Management Responsibility, section 6 Resource Management, section 7 Product Realisation and section 8 Measurement Analysis.

ISO 9001 section 4 requires that an organization has a documented system with procedures in place to control documents and records. Section 5 requires the quality management system to include a quality policy and for senior management to demonstrate management commitment, allocate responsibility and authority, and conduct management reviews

Section 6 of the standard requires your system to address and review requirements for resources, human resources and training, infrastructure and work environment. Section 7 of the standard defines the requirements for planning, design and development, purchasing, production, control of customer property and monitoring and measurement. Section 8 defines the quality management system requirements for measurement, monitoring and improvement and includes sub-clauses internal audit, control of non-conforming product, corrective action and preventative action, all of which are compulsory procedures as defined by the standard.

ISO 9001:2008 refers specifically to only 6 documented procedures, however, other documentation may be required by an organization in order to manage the processes that are necessary for the effective operation of the QMS. In addition to the minimum document requirements the standard defines twenty one specific requirements for records.

The documentation required in a system to achieve ISO 9001 certification is no longer as onerous as prior to 2000 and the value of ISO 9001 certification for an organisation has never been higher. Certification sends a clear message to all interested parties that an organization is committed to high standards and continual improvement.
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Mar 21, 2010

Effective Visual Management in the workplace

One of the key attributes of visual management is that information is presented to the workforce at all times in a consistent approach – effective use converts information about performance – goals – customers and presents them in a way that is easy to interpret, in the same way wherever it is displayed – this helps reinforce links between the workforce and performance encouraging staff engagement.

There are various benefits associated with organizations that utilize effective visual management these include

• Greater effectivity – work is targeted towards deliverables
• Improved Employee satisfaction – staff are aware of what the business is doing and why
• Greater visibility of costs
• Greater understanding of organizational targets.

Many organizations half heartedly attempt to deploy Attributes of visual management culture through just putting up dated performance stats while this is a start – organizations utilizing this approach will not exploit all the benefits that visual management has to offer – so what are the traits of effective deployment?

• Mission, and company goals clearly displayed
• Uses variety of media
• Visual aids Customer focused
• Many different forms displayed in many different places
• Real time data where available
• Open book – there for all to see

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Mar 19, 2010

The 7 Deadly Wastes

As more and more companies start to see how lean thinking can be used as a means of reducing waste, the fundamental elements of the lean process, capturing waste, understanding your business through process analysis and improvement techniques such as six sigma become ever more valueable.

All processes have to be examined in lean thinking ensuring the process adds value to both the customer and the organisation, but some are not ‘helpful’ they do not add any value and are considered ‘waste’.

Central to lean process is the elimination of waste and within the concept of ‘lean’ there are 7 identified wastes.

The 7 Wastes


Overproduction is not simply producing too many items, it is about engaging more resources than are actually required, to ensure that the customer’s order can be fulfilled. As a result, the resources used are squandered. Overproduction of goods also requires storage facilities (if too many goods have been produced) and the goods need to be kept in good condition, which will require space, staffing hours and possibly heating etc.


When goods are moved they can be damaged or lost, so there is a risk with transportation that costs will be incurred that have to be born by the company, not by the customer. Transporting goods usually uses up resources, so again there is a knock on effect with regard to transport. As such any unnecessary transportation should be viewed as wasteful.


Inventory is also known as stock, work that is currently in progress or any finished products. However, if you have too much inventory i.e. too many raw materials, too many finished products, problems will be created and money/resources lost accommodating the keeping of raw materials/finished goods. Too much work that is still in progress will also have no value until it is finished.

Conversely, too little stock, too little work being undertaken etc. The solution is to aim for everything being ‘Just In Time’ so that there is no downtime associated with inventory problems.


Motion is slightly different from the concept of transport. It relates to the worker and the equipment as well as the producer. Thus any unnecessary motion is identified and eliminated. This could be a worker having to walk 20 meters to pick up spare parts every half hour. If the spare parts are moved so that there is only 5 metres to walk then the waste of motion has been significantly reduced.


Defects are wasteful because resources have been channelled into producing something that is not fit for purpose. Then there is the added cost of having to rectify the defect, plus the time used to rectify it is lost production time. Defects therefore need to be eliminated.

Over Processing

Over processing is when too much effort goes into an item in the sense of being over and above what is actually required. This could mean using tools that are more expensive to do a job for which a cheap tool would be adequate or using too many resources to finish a product, when it would be perfectly ok to simply use less resources.


If there is any waiting time for personnel or goods, then this has a knock on effect in terms of productivity and output, so waiting time should be reduced as far as possible and the ‘Just In Time’ concept applied in every aspect of productivity.


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Mar 17, 2010

What Is Poka Yoke ?

Poka Yoke is a Japanese phrase that simply means mistake proof. Poka Yoke was devised within the Toyota Production System when it was originally defined as being ‘baka yoke’ which in English can be translated as idiot proof or foolproof.

However, after it began to be used, it was then changed to Poke Yoke, meaning mistake proof.

Poka Yoke is central to the concept of ‘Lean’ thinking, which aims to reduce waste and make sure that everything and is as efficient and effective as possible.

Poka Yoke In Action
Poka Yoke is any process that can stop mistakes being created, thereby ensuring that there are no defects within the production process. So if a machine is designed to stop or at least sound a warning signal if it is not aligned correctly then this is ‘Poka Yoke’ in action.

This concept of stopping defects or mistakes from happening is central to Poka Yoke thinking. It is about ensuring that they simply do not happen.

Mistakes Will Happen!
The ‘creator’ of Poka Yoke, Shigeo Shingo was quite honest about mistakes and how they happen. He stated that mistakes are an integral part of any mass production process; the more you produce, the more likely you are to have mistakes.

However, he argued that mistakes need not result in defects or substandard work being created. If a company devises enough Poka Yokes, then it will ensure that mistakes are identified and then resolved before the defects happen and when there are no or very few defects, then the operating costs of a company will be substantially reduced.

How Can Poka Yoke Improve Business?
The concept of Poka Yoka is both brilliant and incredibly simple. If a company makes products, but around 2% of the products produced do not meet quality control standards, because they are damaged in production, then this has a serious effect on the company’s profits.

However, if the company introduce ‘Poka Yoke’ techniques to ensure that at least 99% of the products produced are fit for purpose and meet quality control targets, then the company will have substantially more profits.

Poka Yoke need not be terribly complicated. Even having staff visually check products at the early stages of production can be ‘Poka Yoke’. This can ensure that all products are fit for purpose when they progress through to other stages of production. Mistakes can be easily rectified the earlier they are spotted, so instead of defective goods, the end result is high quality goods that all pass any quality standards.

Poka Yoke can even involve markings on the floor that show an operator where he or she must stand in order to operate a piece of machinery. Basic as it may sound, if they do not stand in the right position there may be a risk of the machine not being loaded correctly and this can result in the machinery being damaged. Painting the correct standing position on the floor is a quick, easy and cheap way of ensuring that the machine will be loaded correctly and there is no possibility of damaging the machine – simple!
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What is Mistake Proofing?

Mistake proofing (Error Proofing) is about preventing mistakes from production or wasting staff time. Mistakes may still happen, but when using error proofing the chances of them occurring is greatly reduced.
Although the ultimate aim of mistake proofing is to get rid of mistakes, the secondary aim is to manage mistakes when they happen, before they can affect productivity and efficiency!

Mistake proofing needs to become the predominant culture within the organisation, with everyone recognising that mistakes cost a lot of money in terms of the labour time lost in putting things right.

Get Back To Basics
In order to mistake proof, it is necessary to look at why mistakes happen and then what can be done to eliminate them.

Mistake Proofing By Design
Mistake proofing can be done by design; designing the workstation differently, designing the machinery differently and so on. So it is about ensuring that they have the correctly designed equipment to work productively.

Mistake Proofing By Business Processes
For all personnel to be effective at mistake proofing, they have to understand how they fit in to all the business processes. Only when they understand exactly what needs to be done, how it is to be done and why it is being done, can they be effective in ensuring that they get it right first time.

Mistake Proofing Benefits
Mistake proofing ensures that a number of processes can be substantially reduced in terms of time. For a start, the eradication of mistakes means that there are fewer defective goods created. This means that goods do not have to be inspected as often.

This is important because not only is inspection time reduced, but there are no hold ups in terms of production; the production line simply flows, which makes good economic sense.

Operators are able to operate more efficiently because they do not have to inspect their work as often.

Much less time is spent rectifying defective goods and rejects or scrapped items are few and far between, resulting in less wastage, which in turn increases profits.

Since staff are all aware of the businesses processes involved in their particular area of activities, then they are familiar with what they are doing and they also understand the processes. This means that when mistakes do happen, decision time as to how they can be rectified, before they cause a problem, can be reduced. In turn this creates less disruption to production.

In fact the benefits of mistake proofing are so great that some companies estimate that having undergone a ‘mistake proofing’ exercise, their productivity can rise as much as 50%, which is actually a substantial increase and can seriously increase the profit levels of any company. So mistake proofing offers a compelling economic argument for its implementation!

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The Fault Tree Analysis Diagram

The fault tree analysis diagram is an important tool for quality management. This visually diagram depicts all the major faults that have occurred in a product.
This enables all those who are involved in the production of a product to be able to understand why these faults have occurred and they can then ensure that the causes of the faults are eliminated.

It can also using in new design process to eradicate faults that have occurred in a product and ensuring that future products are fault free.

One particularly good aspect of the fault tree analysis is that it seeks to get to the root causes of any fault problem, and making certain that they do not happen again.

The Fault Tree Analysis In Action

The first step in creating a fault tree analysis diagram is to identify a specific component that is to be analysed. This will be placed at the top of the tree, in its own individual box.

Next, all the faults that are to be found within the component need to be identified. This can be done through brainstorming to identify the failures.

Faults each have their own box below the component.
It is now necessary to work through why the faults have occurred. What were the causes? What actions resulted in these faults being created?

All the causes for the faults need to be identified and then set out in boxes, each one linked to the faults that are listed.

From here it is necessary to get to the root cause for each fault, which may require listing several causes and then deciding which is the root cause in the sense of deciding which is the cause that can be controlled and therefore can be altered so that the fault is no longer produced. Root causes are then linked to the general causes.

Identify countermeasures. Once all the causes and the root causes have been identified then countermeasures need to be listed. These are the antidotes to the root causes and will ensure that the faults are eliminated. Countermeasures are then linked onto the root cause boxes, because they show the actions that need to be taken.

Benefits Of Fault Tree Analysis
The fault tree analysis is very good at looking at a problem from different angles. It requires a very honest approach in order to get to the root cause of problems that result in fault. So human error has to be looked at and also what caused the human error to happen. Was it the result of staff not caring, staff being pressurised in terms of time, or are there issues of staff training that need to be addressed?

The process of getting to the ‘root cause’ for a fault is often quite lengthy, so the fault tree analysis diagram, if it is to be done properly, has to focus on a number of aspects of the production process. Failure to properly identify the root causes and the countermeasures will result in a fault tree analysis that simply fails to elicit improvements. However, when done properly and the root causes and countermeasures are all listed, this analysis can be a powerful catalyst for improvements to production.

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What is just in time?

Just in time (JIT) is the theory that materials are delivered to the point of use at the right time and in the right quantities.The goals of JIT are minimize waste related to inventory, stock should be delivered 'just in time.' Stock is simply brought in or created as and when required. There are various wastes associated with inventory for example in transactional processing, storing what is not yet required, management resource. JIT tries to focus on material at the right time at the right place in the right amount.

The benefits of using JIT principles.

1. Over Production Ceases - components are typically made to order not stock

2. Labour Costs Are decreased- The company saves because it is not paying workers to produce items that have no immediate use. Staff are focused only on the material at hand.

3. Relationships With Suppliers become strategic - Suppliers have to have a positive and inter-dependent relationship with the manufacturer, rather than the historic relationship where the customer had the power and the supplier was not an equal.

4. Motivated Workforce - Staff are motivated by specific goals and targets related to the manufacturing targets.

5. Improvement in scheduling and forecasting - JIT requires adequate focus in scheduling and forecasting (getting these wrong means that you'll have problems in getting the correct inventory at the right time).

6. Material Flow improves - JIT typically includes some rationalization of lot sizes - this facilitates better management of inventory and reduced delays in completing lots for distribution.

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Mar 14, 2010

Supply Chain Management

Supply chain management requires a holistic approach that measures critical points in the process. The areas of sales, marketing, supply, maintenance, engineering, and logistics need to be integrated in a process that aligns these functions to gain efficiency and optimal performance. Organizations can realize the value of strategic procurement, metrics, and performance evaluation by understanding the fundamentals and development process.

In 2003, Cook and Hagey discuss the fundamentals of an effective supply chain in their article published in the Journal of Business Strategy entitled "Why Companies Flunk Supply Chain 101.An effective supply chain consists of five fundamentals: one, the correct strategy; two, talented managers; three, effective metrics; four, broad vision; and five, understanding the differences between components of the supply chain. Although each is important, replacing hunches with metrics enables managers to track quantifiable measures with rigorous methodology and quality data. Decisions can be made to mitigate customer impact by linking metrics to customers, supplies, and logisticians. Flexibility to change as required to reduce costs, improve responsiveness and meet the needs of the customer are critical to supply chain performance.
An effective procurement foundation can be created with five steps: mapping, validation, collection, analysis, and documentation of results and findings. By undergoing supply chain re-engineering, an organization focuses resources to improve all areas of the supply chain, such as relationships, planning, positioning, and delivery. The results of transformation are improved forecasting, distribution, collaboration, and automation. Managers require key personnel to monitor and evaluate key measurements of performance. Effective supply chain management ensures finished goods are available at the distribution centers, enable reliable and responsive production capabilities, make certain efficient use of production resources, and provide for effective production planning.
With standardization comes efficiency and flexibility, and methodologies, such as Six Sigma and Lean manufacturing, provide systemic methodology for the establishment of process standards. In 2004, Ramakumar and Cook stated in " Process Standardization Proves Profitable" for Quality Journal that companies engaged in process standardization are able to manage complex value chains and are 73 percent more profitable than organizations that do not use standards. Defining metrics, enforcing business rules, developing a logical flow of data and remaining flexible are essential to implementing standardization. When sales are down and costs are rising, supply chain management enables an organization to maximize resource utilization and cash optimization. Explore supply chain management strategies as a way to improve the bottom-line of your business during these challenging economic times.
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Mar 13, 2010

Lean Manufacturing

The 5S system is widely used today in a very large percentage of manufacturing businesses. Many non-manufacturing companies also employ the discipline.

The 5S system is one of the most common lean manufacturing principles, and generally the first one applied during implementation.

The 5S system is a workplace organization and housekeeping system. When applied correctly, the benefits are enormous in terms of productivity, quality, and morale.

The 5S's are:


Set In Order




There are variations to some of the 5S's as they were derived from 5 Japanese words beginning with "s".

Most organizations apply the 5S system in one area at a time rather than across and entire facility at once.

The first "S" is Sort. It is the process of removing all unnecessary items from the workplace area. This first step is crucial to gaining efficiency through workplace design. all items are tagged which aren't necessary for the specific area. These unnecessary items tagged are then moved to a "hold" area for review and disposition.

The second "S" is Set in Order. This is the process of moving the necessary items into the correct position for use. It is the process of organizing the work area to be perfectly laid out for maximum efficiency through minimizing movement. For example, if a tool is only to be used at the end of a machine, it should be kept there.

A common method used is called "shadow boards", where the exact dimension of the tool is painted onto the board depicting the spot in which to hang the tool. It becomes obvious where the tool belongs.

The third "S" is Shine. This is the method of deep cleaning a machine or area to put it back into the condition it was when it was purchased. The idea is that quality and efficiency will not suffer if the machine is not allowed to deteriorate over time. Machines that are kept in new condition have less downtime and produce the same quality level as a new machine.

The fourth "S" is Standardize. This is the process of standardizing the entire system, which is often the most difficult. Most companies have conducted the first three S's many times, only to watch the condition deteriorate over time. This cycle of cleaning up followed by gradual deterioration has been repeated over and over for years. The "Standardize" portion of the system corrects this problem.

The best way to standardize the system is to determine exactly what needs done to maintain the system. It is the "who, what, when, where" of 5S. For example, if a specific portion of a machine needs cleaned daily, there should be a checklist and written instructions detailing who will do it, when it will be done, and methods and materials necessary.

The last "S" is Sustain. Sustaining the system is thought to be one of the most difficult, primarily because experience proved years of cleaning and organization were not maintained. However, if the system is standardized in the fourth S, then sustaining it is much easier.

The best method of sustaining the system is to conduct audits. Care must be exercised so the audit system is not punitive. The 5S system relies on employee involvement and commitment at all levels, and a punitive audit system can destroy the system.

A good 5S implementation has many benefits. The assets of the company are kept in top condition which keeps the value high. Quality is kept at the level when the asset or machine was first installed. Maintenance costs are reduced as deterioration is immediately apparent. Setup times go down from better organization and reduced movement.

The best benefit is the morale improvement from an improved environment and culture.

Some managers think employees will not sustain a perfectly clean manufacturing environment. Like most systems, management is the reason the system succeeds or fails. Given the chance, employees will implement and sustain the 5S system. Most employees will choose an organized and clean workplace with a continuous improvement culture over a dirty disorganized facility.

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Mar 11, 2010

Statistical Process Control (SPC)

SPC: Doing It Right the First Time

To prosper in the economic climate of today, companies and their suppliers must be dedicated to never-ending improvement in quality and productivity. Leaders must constantly search for more efficient ways to produce products and services that meet customers' needs. Most organizations clearly state their dedication to achieve continual quality improve­ment with the company's Quality Policy.

Most everyone agrees that "Doing it right the first time" and the policy of prevention are sensible and even obvious philosophies which will, when adopted, improve the quality of all the products manufactured or services provided by any company. Quantitative measures are needed to effectively monitor process and product or service performance. Statistical Process Control or SPC and its associated problem solving techniques contain the quantitative tools which will allow us to get a more objective handle on quality. These concepts have been taught under the banner of SPC, Statistical Methods and most recently the Six Sigma approach. All of these are based on simple statistical methods that can help manage process variability and thus improve quality.

SPC: The Definition

You may or may not have an idea of what SPC or Statistical Process Control is. In either case, let's see what it is not. It has already been said that it is not a quick fix for quality or productivity problems. Neither is it simply learning about control charting. Instead, it is a way of managing business operations to achieve continuing improvement in both process and people. Often SPC has been misunderstood to be simply using statistics to try to solve business problems.

SPC can be defined as using statistical techniques to analyze data, then using the information to achieve predictability from a process.

SPC is a technique of monitoring and measuring performance using basic statistics such as averages, ranges or standard deviation along with the associated time sequenced charts and graphs. SPC methods can provide a picture that can be analyzed to detect an oncoming problem before the product of a process goes off specifications. Further, the data and charts can be analyzed to help identify the root cause of a problem--the first step toward problem elimination and prevention

SPC: The Beginnings

SPC is neither a new technique nor was it developed by the Japanese as many suppose. To review the development of SPC requires that we discuss Dr. W. Edwards Deming, who could be considered the "father of SPC".

Dr. Deming, a statistician by education, was associated with the Census Bureau, National Bureau of Standards and the Department of Agriculture early in his career. He became acquainted with Dr. Walter Shewhart of Bell Labs who introduced him to the concepts of process control.

During World War II, Dr. Deming taught statistics to thousands of individuals from hundreds of companies. The objective was to use this knowledge to bring better precision and more productivity to the nation's wartime manufacturers. A serious shortcoming of this effort was that it failed to involve top management but focused primarily on the engineering functions. Gradually, the techni­ques, though initially effective, disappeared due to lack of manage­ment support.

In 1945, Dr. Deming assisted Japan in certain agricultural areas. Later he was invited to teach statistical methods to industry. Through the efforts of Ichico Ishikawa, Japanese managers became not only familiar with, but committed to the concepts taught by Dr. Deming. Change was not immediate, but as you know, Japan now sets the standard for quality in many industries. Dr. Deming has since been honored by the Japanese for his efforts. Their highest award for industrial excellence is known as the Deming Prize.

Today many managers still think that only minor changes in their organizations will solve productivity and quality problems. There are numerous productivity programs available, but many avoid the recognition of the responsibility of management to change the systems they perpetuate.

Deming once asserted that 85 percent of all the problems of a company belong to the system which only management can change, and 15 percent of the problems can be solved by the workers. Before his death in 1994, he revised his estimates to 94% and 6%. If a company is to achieve significant gains in productivity, the management methods and styles of the organization must change.

SPC: Benefits

Successful implementation of the SPC approach to the control of quality offers several benefits:

l. Increased customer satisfaction by producing a more trouble-free product.

2. Decreased scrap, rework and inspection costs by controlling the process.

3. Decreased operating costs by optimizing the frequency of process adjustments and changes.

4. Maximized productivity by identifying and eliminating the causes of out of control conditions.

5. A predictable and consistent level of quality.

6. Elimination or reduction of receiving inspection by the customer.

The challenge is to learn and use the tools of SPC properly. The rewards are great. Only by everyone in the organization working together toward the same quality goal can your business ultimately be successful in the market place.
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Quality Control at Work - How to Become Leaders in Your Business

Quality-control is one of the most important aspects of running any business. Whether it's a product or service, your best approach is to always strive to be the best quality provider in your industry or area. If you can state that your products are some of the finest in the world than you will always have a steady stream of customers and clients.

If you find that your business is running at a standard which is lower than what it could be you should take action immediately to recover your losses. Launch an initiative to become the leader in your field as soon as possible. It has been estimated that the leader in the public eye gets at least 50% more recommended service agreements than second-place.

If you're unsure of where to begin, look at the leaders in your field. Even better, look at the leaders in some of the biggest companies of the world. Ask yourself how did they become so proficient at their work, and how did they secure such high quality products and services. Go ahead and read write the book on quality if needed.

Make quality the job of absolutely every employee within the company. Make sure that bonuses are tied directly to all quality-control performance levels. Make sure that quality-control is a essential component of any promotion strategies.

If you are to consider your company growing then you must always strive to improve. Improved is not mean always just improving your bottom line, improve also means improving your products and services to meet the higher demands of the market and to compete with others.

Here are some ways to improve your quality-control at work:

Make sure you take great pride in your work. You don't have to change everything in the business to make a difference. Make sure you inject a high level of quality into everything you do.

Seek out quality training. Make sure you partake in and offer the highest level of quality training possible in your industry. In addition you may want to take part in some extra course work and training yourself.

Always take responsibility for providing the highest quality products and services that work. The work you do is a reflection of the way you think. Make sure that the work you do reflects positively upon others when they consider your work. Others will also notice the standard of work that you produce and strive to do the same.
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Important of Quality Control For Your Business

Quality control is a process within an organization designed to ensure a set level of quality for the products or services offered by a company. This control includes the actions necessary to verify and control the quality output of products and services. The overall goal includes meeting the customer satisfaction. Most companies provide a service or a product. The control is important to determine that the output being provided is of overall top quality. Quality is important to companies for liability purposes, name recognition or branding, and market share.

This process can be implemented with a company in many ways. Some organizations bring in a quality assurance department and practice testing of products before they are delivered to the customer. When quality assurance is used, a set of requirements is determined and the quality assurance team will verify the product not only meets all of the requirements but they will also perform faulty testing. Companies with a customer service department often implement quality controls through recording phone conversations, sending out customer surveys, and requiring employees to follow a specific set of guidelines when speaking to customers over the phone. Implementing a quality control department or strategy allows a company to find faults or problems with products or services before they reach the customer.

It is common for a company to send out products that have defects or problems or provide poor service to customers. A good strategy and using techniques can help ensure the elimination of issues that give the company a bad name. This is because quality control monitors the overall quality by comparing the product or service with the requirements. Making sure the products or services meet or exceed the requirements set forth allows a business to be more successful and improve the organization.

Quality control not only consists of products and services but how well an organization works as a whole together within the organization and in the marketplace. A strategy to manage and improve the quality within an organization can help a company become and remain a success. Quality is an ongoing effort that must be consistent and improving every day. Every organization or business can benefit by using quality control for their products or services, within the internal organization, and interacting in the marketplace.

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Mar 4, 2010

Lean Manufacturing Implementation - A 20 Step Roadmap

Lean Manufacturing is being utilized by businesses of all sizes today. Although it took a few years to become mainstream, the success stories from mid-size to large corporations have pushed lean manufacturing down to very small organizations.
a roadmap can be used with common sense. Lean manufacturing has been called "common sense manufacturing", although not always "common practice".

Lean Manufacturing Roadmap:
Form team (mix of lean manufacturing and relevant business experience)
Develop communication and feedback channel for everyone
Meet with everyone and explain the initiative
Begin to train all employees (lean overview, 7 wastes, standard operations, kaizen, PDCA)
Facility Analysis - Determine the gap between current state and a state of "lean"
5S - It is the foundation of lean. Workplace organization is critical for any lean initiative
TPM - begin total productive maintenance early (used throughout lean)
Value Stream Mapping - Determine the waste across the entire system
7 (or 8) Waste Identification - Use with value stream mapping to identify system waste
Process Mapping - a more detailed map of each process
Takt time - determine need to produce on all processes, equipment
OEE & 6 Losses - determine the losses on all processes and equipment
Line Balance - Use if necessary with takt time and OEE
SMED - push setup times down to reduce cycle time, batch quantity, and lower costs
Pull/One Piece Flow/Continuous Flow Analysis - utilize kanban and supermarkets
Analyze Quality at the Source Application - poor quality stopped at the source
Implement Error Proofing Ideas
Cellular Manufacturing/Layout & Flow Improvement - Analyze facility and each process
Develop Standardized Operations - concurrently with SMED, line balance, flow, layouts
Kaizen - continue improving operations, giving priority to bottlenecks within the system
The specific implementation plan should be developed from the facility analysis. The analysis identifies areas of opportunity in every area of the business, including sales, service, engineering, maintenance, production, quality, shipping, and administrative functions.
The lean manufacturing team needs to be trained to understand when the lean tools must be supplemented to either solve the problem or maximize the improvement.
Kaizen events may use all of the lean tools (and some six sigma tools) to meet the team's objective. Kaizen events are conducted on an ongoing basis to achieve a state of "lean". For example, a process may need a quick throughput improvement. The kaizen blitz could include focused SMED (single minute exchange of die) and OEE analysis. The kaizen might have an objective to reduce setup time from 80 minutes to 60 minutes in 4 days.
It is important to keep an enterprise view with the analysis and roadmap. No single operation should be improved at the expense of the entire system. For example, if a bottleneck is happening at Process B, improving Process A prior to B only hurts the system worse. A larger scale example is improving throughput if shipping cannot handle the volume. Although many improvements cause bottlenecks elsewhere, forcing a larger known problem is rarely a good idea.
However, there is a logical sequence to many of the tools. Value stream mapping is almost always conducted very early on in the process. The 5S system provides a foundation for most other tools. TPM is large and plays an important role in OEE improvement, and therefore must be started early.

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Lean Six Sigma Process Improvement

A SWOT analysis is a well established and particularly useful technique for helping decision makers determine if their strategic business objectives are achievable. It is normally conducted during strategic planning and, it is used to quickly identify a company's Strengths, Weaknesses, Opportunities, and Threats. A SWOT analysis is essential because subsequent steps in the planning process are derived from SWOT.

To set the stage for showing how a SWOT diagram is useful in improving business processes, one must first understand how it is typically used to support a SWOT analysis during strategic planning.
A SWOT diagram is a rectangular diagram, divided into four quadrants, used to articulate the results of a SWOT analysis. The top left quadrant identifies a company's strengths. Strengths are those attributes that aid in achieving the strategic business objective. An example of a strength might be current market share of a product. The top right quadrant identifies a company's weaknesses. Weaknesses are identified as inhibitors to achieving the strategic business objective. An example of a weakness might be insufficient capital to ramp up marketing. The bottom left quadrant identifies a company's opportunities. Opportunities are conditions that are helpful in achieving a company's business objective. An example of an opportunity might be a relaxation of a government regulation that enables the company to enter a new market. The lower left quadrant is used to identify a company's threats. Threats are normally external conditions that can derail a company's strategic business objective. An example of a threat may be the development of a similar product by a competitor. Each of the four quadrants is further subdivided into "Internal Attributes and External Attributes." Sometimes there is a fine line between these two but that is a subject for another time. When separation is not apparent, I always classify the attribute as Internal.
Now let's draw the parallel for using a SWOT diagram in a Lean Six Sigma process improvement engagement. I prefer to use SWOT diagrams early on in the process improvement program. As in strategic planning, my goal early on is to help my client focus on the objective and determine under what circumstances that objective is attainable. Also, as in strategic planning, the SWOT analysis and supporting diagram drive subsequent process improvement steps.
Once the strategic process improvement objective is identified and quantified (a fundamental rule for any Six Sigma engagement), I begin to populate the SWOT diagram. SWOT quadrant names remain the same but the definitions are modified to fit a process improvement model. Strengths now identify the current strengths in the existing process and/or the desired strengths of a new process. An example of an existing or desired strength might be subject matter expertise that gives the company a strategic process advantage. Weaknesses now identify weaknesses in the existing process model or potential weaknesses to achieve desired objectives. An example of a weakness might be a lack of subject matter expertise, technology, or information that is critical to the operation of a new or improved process. Opportunities now identify conditions that will help make the strategic objective attainable. An example of an opportunity might be seamless supply chain integration due to the installation of a new computer system. Threats now identify competitive threats, regulatory risk, and a "bottom line" analysis if we fail to act. I always ask the question "If we fail to act, what impact will it have on the customer, our company, and our employees?"

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Six Sigma - Why Use It?

Utilizing all the tools that you have available to you is just good business sense. If there are problems that need to be solved in your business, you need to take the time to figure out the best way to solve them and use the tools you've been given effectively to do so. Only when your business is running at its best, will you see the most success in the way of profits for your business. Why should you use Six Sigma ? There are many different reasons, However, you should know that it is an effective means of problem-solving and process improvement and that it's worth a shot.

If you're looking for the best solution, Six Sigma Projects are a great way for any business to get an analytical at the way things are operating and how their processes can become more effective. Even when you think that there aren't any problems in your processes. You may be surprised to see what the analysis of Six Sigma metrics has to offer for your business. Learning to effectively use the tools of Six Sigma Methodology is a matter of receiving the proper training and experience to make you able to work the steps of the process to the best of your ability.
For many people here, the financial ability for Six Sigma Training and Certification is where the problem presents itself. However, if you take the time to find outside resources to handle the first couple of projects, and then use the profits that you're making from those projects to train your own employees it will immediately become a much more achievable goal and accessible tool for your business.
Next time you question why you should use six sigma Projects for your process improvement; perhaps you should take a step back. Look at all the success that people have had with the process and then ask yourself why not, instead of focusing on why. There are many great benefits to using Six Sigma in your business, but only you can truly determine whether it's right for you or not. Why should you use Six Sigma? The answer is simple: it's a fact-based data driven statistical analysis of how your business operates and where improvements can be made. If executed properly, Six Sigma can be a great asset to any business of any type and size.

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Mar 3, 2010

Does Quality Lead to Better Business Results?

The effects of quality on business results are mixed; some firms have been wildly successful with their quality efforts and other companies have been unsuccessful in gaining bottom-line results. There are two primary reasons for this.

First, there are many variables that affect profitability besides quality. The firm might produce the highest-quality, obsolete product in the world. If the firm produces a high-quality product or service that no one wants to buy, quality management systems likely will not save it.
Second, many companies implement quality incorrectly. Quality improvement takes a long time, and many firms' desire quick returns on investment for quality train­ing programs. When these returns are slow in coming, the companies give up in mid­stream and wonder why their quality efforts were ineffective. At the same time, quality programs have been shown to be effective in a variety of cultures and industries when implemented correctly. Hence, the mixed results. As a result, we need to understand the relationships between quality and other variables.
Quality and Price : The relationship between price and quality has long been stud­ied. Indeed, the laws of supply and demand lead to a natural ordering of competing products on a price scale such that a superior product would be the most highly priced.
Quality and Cost: A fundamental difference exists between a low-price strategy, which is based on competitive pricing, and a low-cost orientation that is based on con­tinual learning and production competence.
Quality and Productivity: The relationship between quality and productivity is clearer and has been demonstrated over time. The elimination of waste results in higher productivity. Simplification of processes also results in flows that are simpler and of higher productivity.
Quality and Profitability: Many quality enthusiasts have declared that quality will always result in improved profitability. They will further state that those cases where quality does not lead to improved profits are the fault of the offending implementer.
Quality and the Environment: Another strategic imperative receiving increasing at­tention is the effect of business on the environment. Because of regulatory pressures— both domestic and international—firms realize they must integrate environmental concerns into their strategic plans.

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