Discussion:
PDCA Cycle
You learned how customers play a pivotal role in the success of an organization. In addition, you learned how employee empowerment can pave the way for implementing quality strategies. Finally, you discovered how leaders are important in implementing quality management.
You will learn about the tools stakeholders of a company can use to collect, analyze, and evaluate data, and, accordingly, identify and implement quality management strategies. For example, the management of a particular shop may want to use a quality tool to collect and compare data about the number of customers who arrive before the store opens to those who arrive when the store is ready to close. Using this data, the owner of the shop may determine how products and services may be used at different times of the day.
Different quality tools may be used by company management to analyze and evaluate processes. These tools may also be used by empowered employees to make reliable and valid decisions and to determine better ways of achieving customer satisfaction.
By providing management with quality tools and employees with quality techniques, an organization can work toward a quality improvement process for both the employees and the customers.
Let's begin with an overview of the traditional tools used in quality management.
Traditional Quality Tools
Quality management tools help businesses achieve enhanced quality, improved productivity, and increased customer satisfaction. Each quality tool has its advantages, and each can be applied to obtain specific results. The following are some traditional quality tools:
Pareto Chart It is a bar graph in which the lengths of the bars represent frequency or cost of a problem. This chart visually depicts problems that are more significant than others. Organizations can use Pareto charts to analyze data about the frequency or cost of problems in a process, to identify and focus on the most frequent or costly problem, and to decide where to allocate limited resources.
Cause-and-Effect Diagram It is used to identify the possible causes for an effect, or problem. It can be successfully used in a brainstorming session to sort ideas into useful categories.
Check Sheet It is a structured form for collecting and analyzing relevant data and presenting the same in an easy-to-understand format. Check sheets are useful for data that can be observed and collected repeatedly by the same person or at the same location. It is also useful when collecting and analyzing data on the frequency or patterns of problems or when collecting data from a production process.
Histogram It helps in understanding the frequency of a particular set of problems over specific time frames. Organizations can use histograms to analyze numerical data, to determine whether the output of a process is distributed normally, to analyze whether a process can meet customer requirements, and to see whether there has been a process change over time. In addition, histograms can be used to compare the outputs of different processes and to communicate the distribution data effectively.
Scatter Diagram It is used to determine the correlation between two variables, or paired numerical data. It can also be used when the dependent variable may have multiple values for each value of the independent variable. For example, after brainstorming causes and effects using a fishbone diagram, an organization can use the scatter diagram to determine objectively whether a particular cause and an effect are related.
Run Chart It is used to analyze and evaluate the performance data of a process over a specific time span. However, the run chart does not help in identifying whether the variations in data are caused by special causes or common causes.
Control Chart It is similar to a run chart, but it has a central line for determining the average, an upper line for determining the upper control limit, and a lower line for determining the lower control limit. By comparing current data to these lines, it is possible to identify whether the variations in data are caused by special causes or common causes. A control chart can be used when controlling ongoing processes, when predicting the expected range of outcomes of a process, or when determining the stability of a process. It is also useful in analyzing patterns of process variation from special causes or common causes. Finally, it is useful in determining whether a quality improvement project should aim to prevent specific problems or to make fundamental changes in the process.
Ivory International produces and markets a special brand of toothpaste. Although the quality of Ivory's product is acclaimed all over the U.S. market, its sales team failed to meet their sales targets over three consecutive quarters. In other words, the current sales figures do not map to the planned, or desired, state for the sales figures. This discrepancy between the current and the desired state indicates there is a problem-maybe the sales targets are unrealistic, maybe there is a skill issue with the members in the sales team, or maybe there is a problem related to product, price, place, or positioning. In a quality setting, Ivory International will use an appropriate quality tool to analyze and identify the cause of the problem, to find appropriate measures to solve the problem, and to ensure continual improvement. This process of solving a problem and ensuring continual improvement is known as problem solving.
Quality Tools for Problem Solving
Different quality tools are available for solving problems. Depending on the type of a problem, an organization can select the appropriate tool.
PDCA Cycle The PDCA cycle or the plan-do-check-act (PDCA) cycle, includes four stages: plan, do, check, and act. The "plan" stage is needed to determine the goals and objectives of the problem-solving process. The "do" stage is important for implementing the solution. The "check" stage is needed to check the outcome of the solution against the planned goals and objectives. Finally, the "act" stage is needed to implement the complete solution or to make the required adjustments to the solution. The PDCA cycle can be used in solving almost all types of problems. For example, a company can use the PDCA cycle to understand why its sales team failed to meet its sales targets, and then, it can design appropriate solutions that would help meet the sales target.
Flowchart A flowchart depicts the basic flow of information in a process. It is used to chart the inputs, steps, functions, outflows, and timings of a process. Flowcharts are useful in a brainstorming session, where the participants can look at the flow of process information, determine if there are specific problems in the process, and then provide suggestions for potential solutions to the problems. For example, a company notices a particular part in its manufacturing process is taking more time than usual. The company management arranges a brainstorming session to discuss that part of the process. The management uses a flowchart to understand each step and activity in the process part and realizes that moving a cabinet containing screws near to the workers will save time wasted in getting them delivered from the basement. This simple solution would considerably reduce the process time.
Survey A survey can be useful in obtaining relevant feedback from internal and external customers. Internal customers may provide feedback on products, services, and processes, while external customers may offer feedback on a specific issue relative only to the consumption or utilization of a product or a service. For example, a company can conduct an internal survey to gather employee feedback on the effectiveness of a new process. The same company can use an external survey to gather customer feedback on the effectiveness of a new product.
Using the PDCA Cycle
To understand the use of the PDCA cycle, let's continue discussing the business problem related to the sales team of Ivory International.
• Plan: The problem with Ivory International is the inability of its sales team to meet the targets. A proper solution should eradicate this problem and help the team meet its target. The management of Ivory International can have brainstorming sessions to identify the potential causes for the problem. Next, they can use tools such as flowcharts, cause-and-effect diagrams, Pareto charts, and surveys to collect and analyze relevant data and identify the root cause of the problem. Based on the analysis, they can formulate the hypothesis and design the solution. Let's assume, as per the hypothesis, the pricing and positioning of Ivory's toothpaste is the root cause. A tube of Ivory's toothpaste, weighing 184 ounce, is priced at $10. Its advertisement claims the toothpaste should be used three times a day for best results. However, surveys reveal the targeted market segment for this toothpaste does not have the required purchasing capability, and they are also inhibited by the fact the toothpaste will yield results when it is usedat least three times a day. Based on this hypothesis, the management can plan to make the toothpaste available in smaller tubes so it becomes affordable to the market segment. In addition, the market positioning of the toothpaste can be changed to avoid details regarding the number of times it should be used in a day.
• Do: Ivory International can implement the plan for the next two quarters in a select state in the U.S.
• Check: Ivory International can use tools such as surveys, control charts, and key performance indicators to collect and analyze sales data for the two quarters. This will help the company check the correctness of the hypothesis and the success of the planned solution.
• Achieved Goal?
Yes: If the designed solution achieves the targeted outcome, then the management can proceed to the next step of acting on the solution.
No: If the designed solution fails to achieve the targeted outcome, then the management should go back to the planning stage and take necessary actions to review the hypothesis and the solution.
• Act: After correctly identifying the problem, planning a solution, and checking the effectiveness of the solution, Ivory International can implement the full-scale solution all over the U.S. In addition, it should plan for the ongoing monitoring of the solution, look for other improvement opportunities, and ensure continuous process improvement.
Another Problem or Improvement: If Ivory International identifies another problem or an improvement area, it should start from the planning stage and find an appropriate solution.
Steps in the Decision-Making Process
Once more, let's use the example of Ivory International to understand the steps in the decision-making process. In the planning stage of the PDCA cycle, the management of Ivory International identified cost as a root cause of the business problem, and, accordingly, they came up with a number of solutions. Let's see how the decision-making process helps the management decide on the most appropriate solution.
1. Identify the problem. One tube of Ivory toothpaste weighing 184 ounce is priced at $10. This price is beyond the purchasing capacity of the targeted market segment.
2. Gather and analyze relevant data. The management uses various tools to gather demographic data, competitive market data, and data about customer expectations. Next, they analyze the data to identify patterns.
3. Consider alternative solutions. Based on the data analysis, the management proposes a number of alternative solutions, such as reducing the price of the product and making the product available in smaller tubes.
4. Choose the best alternative. While weighing the alternative solutions, the management discovers it is not possible to reduce the product price while maintaining the product quality, and compromising quality is not in keeping with Ivory's quality policy. On the other hand, making the product available in smaller tubes will help retain the quality and also fit the purchasing capabilities of the targeted market segment. Therefore, the management chooses the second solution as the best alternative.
5. Implement, monitor, and adjust the chosen solution. The management then implements the chosen solution, monitors the results, and adjusts the solution to achieve the best results.
Several individuals may be involved in determining the best solution, which might lead to subjectivity in the decision-making process. It is important to reduce subjectivity and adopt an objective decision-making approach. However, even after making an objective and appropriate decision for the organization, management will still need to make adjustments to the solution so it works most effectively.
You have learned the importance of customer feedback in the process of implementing quality management. However, the previous discussions have mostly focused on gathering customer feedback and making improvements to an existing to product or service. QFD, on the other hand, focuses on designing each new product with customer input as a main aspect.
QFD is useful in analyzing, evaluating, and incorporating customer needs in the process of designing a product or a service. In other words, QFD ensures an organization produces what its customers want. The benefits of using QFD include customer focus, time efficiency, teamwork orientation, and documentation orientation. The steps involved in implementing QFD include forming the project team, establishing monitoring procedures, selecting a project, conducting a kickoff meeting, training the project team, and developing the matrices.
Tools for QFD
To help identify and incorporate customer inputs, QFD involves the use of traditional quality tools as well as several specialized tools, such as the affinity diagram, the interrelationship digraph, the tree diagram, and the matrix diagram.
Affinity Diagram It is used to promote creative thinking and the finding of new and different approaches to continual improvement.
Interrelationship Digraph It is used to logically identify relationships among different ideas.
Tree Diagram It is used to identify all the tasks that should be completed in order to solve a problem.
Matrix Diagram It is used to identify and graphically represent connections among such things as responsibilities, tasks, and functions.
You have explored different quality management tools and seen how these can be used for evaluating processes, for identifying different types of variances in processes, and for ensuring continual improvement. It is important for management to select the most appropriate tool for achieving the objectives and goals of a particular quality management process. In addition, they may also need to train employees to use the tools, and, thereby, to empower them to make appropriate decisions.
You will continue exploring the use of quality tools with a special focus on SPC, continual improvement, and benchmarking.