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Measuring Cost of Quality August 29, 2016

Posted by Tim Rodgers in Operations, Process engineering, Quality, Supply chain.
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I’ve always thought “cost of quality” was a great idea in principle. If you could take the costs associated with defects, field failures, returns, and warranty claims, and add the costs of inspection, testing, scrap, and rework, then you could get everyone’s attention.

Quality would no longer be some abstract “nice to have” thing, but a real expense category that could be monitored and managed. With an objective, quantitative model to view how much money is actually being spent because of poor quality and associated practices, you would be able to evaluate proposed improvement programs and measure their performance. You would have something concrete to discuss with design and production teams to compare with estimates of future sales and operating expenses, apples to apples. All of this would lead to informed, balanced, and better decisions.

It sounds great, but it’s a lot harder than it sounds. You may be measuring yields and defects and returns, but now you’ve got to measure costs.

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Simplify For Better Understanding August 22, 2016

Posted by Tim Rodgers in Uncategorized.
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Business decisions and strategic plans depend on people for implementation, but leaders and managers are often frustrated and disappointed by what people actually do, which can delay implementation or make strategies less effective.

One of the companies that I worked for did a significant amount of manufacturing at a wholly-owned factory in Shenzhen, China. Quality was a persistent problem from this operation. There were a lot of incidents of missing or incorrectly-assembled parts, and the local production managers were unsuccessful in their efforts to improve the situation. I flew over to have a closer look.

It turned out that all of the assembly work instructions were written in English. I asked the head of the operation why the work instructions weren’t written in Chinese instead of English. He was indignant: “We only hire people who can speak English fluently.” I told him that was fine, and if he wanted to make that requirement I didn’t really care, but I insisted that the work instructions be written in Chinese, or, if he thought it was necessary, in both languages. Shortly after that we starting seeing a significant improvement in quality.

Why make it hard for our teams to understand what we want? If employees seem confused and unfocused it’s possible that they’ve been bombarded with information, sometimes mixed messages that represent competing priorities. Business leaders have a responsibility to communicate clearly, consistently, and simply. My starting point at work is that everyone is trying to do the best work they can. Let’s not make it difficult for them to understand what’s important.

 

 

Are You Looking For Root Cause, Or Someone to Blame? August 15, 2016

Posted by Tim Rodgers in Management & leadership, Operations, Process engineering, Quality.
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When I worked as a quality manager in my first career I was often required to investigate quality failures to determine the cause. There were times when it was pretty easy to figure out, but in an uncontrolled business environment it can be hard to identify a simple dependent relationship between cause and effect. There are usually multiple contributing factors. Sometimes a small thing (the cause) can become a big thing when it’s overlooked (another cause).

Most of the other managers I worked with didn’t have much patience with the complexities of root cause analysis. They wanted a simple, actionable outcome: this is the cause, and if we eliminate this cause then this problem will never happen again (right?), so let’s eliminate the cause. The people who were impacted by this quality failure want answers, and they want to feel confident that the business has taken decisive and effective action. They don’t want to endure an extended period of uncertainty and exposure to risk while the business figures out what to do in order to prevent re-occurrence.

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3D Printing and the Production Ramp August 8, 2016

Posted by Tim Rodgers in Process engineering, Product design, Quality, Supply chain.
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Yes, 3D printing is great. Incredibly intricate designs that have been virtually impossible to fabricate using traditional subtractive or injection molding technology can now be realized. The range of plastics and metallic materials that can be printed continues to grow. The falling prices for commercial printers makes them economically feasible for a variety of applications, including rapid prototyping and on-demand manufacturing of replacement parts for field repairs. The technology will continue to disrupt existing business models and help develop new ones, and I’m following all of this with great interest.

I’m especially interested to see how 3D printing will change traditional manufacturing, particularly for mass production. It’s one thing to build a single product that meets design and performance specifications, but it’s a different challenge to consistently make the quantities of products that are required to satisfy a larger market over an extended period of time at a cost that enables a profit. At some point I expect that established manufacturers will adopt 3D printing as a replacement for current fabrication technologies such as injection molding for some applications, however there are still significant cost and throughput advantages with the older processes.

Here are a couple of considerations:

  • Will the prototype design created using 3D printing still work with the volume production plan? Or, will it have to be re-designed to meet the manufacturer’s requirements and capabilities? A change in the fabrication method means re-visiting the discussion about design for manufacturability.
  • Are the materials used for the 3D printed prototype the same as those that will be used in the final product? What does that mean for functional and reliability testing of the prototype? Are those results still meaningful?

Again, it’s going to be interesting to see how this space develops.

Measuring Service Quality August 1, 2016

Posted by Tim Rodgers in Operations, Quality.
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Product quality seems easy to measure. We just have to sit down with the people who will be using the product or the part or the subassembly and ask them what physical characteristics are important: dimensions and tolerances, chemical composition, electrical performance measurements, strength, weight, and the like. These are things we can then measure, either directly or through test results, on a representative sample from the production process. If we’ve defined the “fitness for use” characteristics correctly, based on what the customer tells us, then we can determine whether or not our processes can reliably produce products that meet those requirements.

Service quality is harder to measure. The trouble starts with defining the requirements. Who are the customers and what do they want? There may be a lot of them, possibly millions of them, with new ones every day. They each have their own set of unique expectations that might change from day to day. They may not be able to articulate their requirements, or at least not in a way that can be acted upon. Services are typically customized for individual customers, and there’s no standard level of performance. What’s acceptable to one customer may not be acceptable to another.

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Quality Decisions in Hindsight July 25, 2016

Posted by Tim Rodgers in Management & leadership, Operations, Organizational dynamics, Process engineering, Product design.
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For the last several years there’s been at least one high-profile case of quality failure that captures the attention of the business press for months at a time. Since late 2015 and early 2016 we’ve been watching to see if air-bag supplier Takata, iconic auto maker Volkswagen, and fast food chain Chipotle will survive their highly-publicized quality missteps. There’s always a lot of apologizing to the public, and a commitment to conduct internal investigations to identify and eliminate the causes of field failures. Senior management and boards of directors scramble to regain the trust of their customers.

I’m not at all surprised by the frequency of these events. What surprises me is that these events don’t happen more often. We should expect to continue to hear about similar catastrophic quality problems from otherwise reputable companies despite all the talk about six sigma and customer satisfaction, and despite all the investments in quality improvement programs. It’s the nature of business.

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How Much Quality Training Do You Need? July 18, 2016

Posted by Tim Rodgers in Management & leadership, Operations, Quality.
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OK, not everyone needs to be a Six Sigma Black Belt, but what elements of quality training should be provided to everyone in the organization?

When I worked at Hewlett-Packard in the early 1990s, senior leadership in our business unit attended a week-long series of six sigma classes at Xerox. When these HP folks returned they were provided with training materials and required to teach their direct reports about six sigma, and those direct reports were required to teach their direct reports, and so on all the way down the organization to people like me.

At the time, quality was not really part of my official responsibilities. I worked at a desk, creating product marketing programs for an internal supplier. The six sigma training was interesting to me, but I didn’t see the relevance to my daily work. What I remember most about those classes was how we were supposed to organize routine meetings, including assigning roles during the meeting and being clear about the objectives for the meeting. I don’t remember anything that seemed directly applicable to the quality of our output as a business unit, or the quality of the work artifacts that we produced as part of our daily responsibilities. It just didn’t seem relevant.

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Is This The Right Problem To Work On? July 11, 2016

Posted by Tim Rodgers in Management & leadership, Process engineering, Project management, strategy.
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The ability to prioritize and focus is widely praised as a characteristic of successful business leaders. There are too many things to do, and not enough time or resources to do them all, much less do them all well. Leaders have to make choices, not just to determine how they spend their own time, but how their teams should be spending theirs. This is the definition of opportunity cost: when we consciously choose to do this instead of that, we forgo or at least postpone any benefits or gains that might have been achieved otherwise.

One of the most common choices that we consider in business is between short-term operational goals vs. longer-term strategic change management. Some people talk about the challenges of “building the plane while flying the plane,” or “changing the tires while driving the bus.” Both of these metaphors emphasize the difficulties of keeping the business running and generating revenue under the current model while developing and implementing a new business model or strategic direction.

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Formulas Without Understanding February 22, 2016

Posted by Tim Rodgers in Education, Management & leadership.
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I’ve just started my second year teaching courses in supply chain management and operations management at two local universities. It’s been a long time since I was a teaching assistant as a graduate student, and my time outside the academic world has taught me a few things about educational objectives and what students really should be learning. One of the things I’ve noticed in my business classes is a tendency of some teachers and textbook authors to focus on formulas that give a “right” answer. I think that’s a mistake, and when we do that we’re not helping business students or their future employers.

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When You Neglect Operations February 1, 2016

Posted by Tim Rodgers in Management & leadership, Operations, Process engineering, Quality.
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A few months ago I heard that one of the companies I used to work for decided to shut down a business unit. I wasn’t surprised, but some people might have been. They had a diversified product line and a hard-working sales force that maintained a high level of demand. Large customers were excited about the new products under development. The supply chain was well-established. What went wrong?

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