PASSI CITY COLLEGE
City of Passi, Iloilo
Course Number: CBMEC 1
Course Title: OPERATIONS MANAGEMENT (TQM)
Course Credit: 3 UNITS
Module Outcomes
At the end of the module the students would be able to:
1. understand the Juran’s Quality Trilogy
2. identify the seven tools of Kaizen for improvement of processes and;
3. discuss the Business Process Reengineering (BPR).
Module Content:
Chapter 8
CONTINUOUS PROCESS IMPROVEMENT
DISCUSSION
INTRODUCTION
TQM means gradual and continuous improvements of the processes within the organization. TQM consists of finding
new opportunities for improvements of processes, improving them, measuring improvement and then repeating the
cycle again and again. The improvement strategies were evolved, experimented and published by the quality gurus. A
number of new improvement methodologies were evolved in Japan. In this chapter, we will learn the following
concepts, techniques and tools that are used for continuous process improvement.
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Juran’s Trilogy
Kaizen
Kaizen Blitz
5S Practice
Three MUs
The Seven Deadly Wastes
Business Process Reengineering
JURAN’STRILOGY
Juran brings out that good financial results are achieved in an organization through three managerial processes Juran
suggests namely, similar planning, control and improvement. Juran suggests similar analogy for better quality results.
The quality trilogy consists of the same three managerial processes and aimed at improving quality of products and
services. They are:
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Quality Planning
Quality Control
Quality Improvement
HERMINIA M. FONTANILLA
Instructor- OPERATION MANAGEMENT (TQM)
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The above three organization wide processes discussed in Chapter 1 are the constituents of Juran’s quality trilogy.
Juran’s trilogy means, “managing for quality is achieved by the use of the three managerial processes of planning,
control and improvement”.
The quality planning starts much before the production operations begin. During the quality planning the needs of the
customers are identified; the product and the processes that will facilitate making the product are developed to meet
the needs of the customer. They will find a number of deficiencies in the product thus made; which make the
percentage defects higher. It could be as high as 20 percent. Deficiencies might have occurred due to errors in the
planning process. During this phase, a large number of defects are found and corrected through quality control. The
process operators apply control to prevent things from getting worse. In the due course time, due to quality
improvement initiatives, a new zone of quality control is reached. This gain was achieved through the third process
namely quality improvement. Now the per cent defectives may reach 5 per cent. This achievement is due to quality
improvement action initiated by the organization.
KAIZEN
Kaizen is a Japanese word. It means gradual, orderly and continuous improvement. Kaizen does not need any capital
investment, but it requires time and efforts of every employee in the organization, right from the top management.
Continuous improvement is achieved through improving the current way of manufacturing and eliminating waste.
Kaizen is a Japanese strategy for continuous improvement
Two Activities of Kaizen
Kaizen comprises the following two activities, carried out simultaneously:
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Maintenance
Improvement
An organization functions with a set of processes. Maintenance involves activities direct at maintening current
technological, managerial, and operating standards. While efforts are going on for improving the processes, the present
activities should continue as per the current standards without any interruption. Kaizen involves small, continuous
improvements of the current processes.
It is the primary responsibility of the factory workers to maintain the existing system. The top management and the
middle management make efforts in finding out improvement opportunities. The supervisors will also participate in
Kaizen efforts but their main responsibility will be to maintain the current system. While the workers and the
supervisors concentrate on maintaining the current status and production, middle management and the top
management have to take keen interest in the following activities towards Kaizen:
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Maximizing efficiency and productivity of employees as well as the plant
Improving the quality of the process, plant and thereby the product
Minimizing inventory levels and Work In Progress (WIP) – (WIP means that making the product has started but
not finished due to some reasons, beyond the control of the organization)
Improving ergonomics to facilitate the human resources to maximize their output with more comfort
Call for suggestions from workers
Enabling team work
Improving systems in the organization
Three Basic Principles of Kaizen
There are essentially three basic principles of Kaizen.
(i) Work place effectiveness
(ii) Elimination of waste, strain and discrepancy
(iii) Standardization
Work place effectiveness Japanese have developed the 5S tools for addressing the work place effectiveness which will
be discussed later in this chapter.
HERMINIA M. FONTANILLA
Instructor- OPERATION MANAGEMENT (TQM)
2
Eliminating wast, strain and discrepancy Kaizen is achieved through application of 5S tools for workplace
effectiveness and elimination of three MUs.
The wastes are not free, but have been paid for by the organization, since those who produce wastes also get paid and
the material wasted costs money. Therefore, one has to minimize and ultimately eliminate the waste in an organization.
The waste, strain and discrepancy in respect of the following are to be reduced and finally eliminated:
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Human resources
Production volumes
Inventory (materials)
Time
Working space
Machinery
Techniques
Facilities
Tools and Jigs
Thinking
Standardization Kaizen stresses standardization of processes, materials, machinery, etc. with the following objectives:
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Represent the best, easiest and safest way to carry out a job in the form of operating procedures and work
instructions
Represent the best way to preserve know-how and expertise and standardize the procedures for the same
Evolve effective means to measure performance and standardize the same
Standardize all the procedures that are used in the organization for maintenance and improvement of process
Standardize the training programs
Standardize the audit for diagnosing problems
Standardize the procedures for preventing occurrence of errors and minimizing variability
Thus, Kaizen consists of three basic principles namely the application of 5S for improving workplace effectiveness and
simultaneously reducing and eliminating three MUs as well as standardization of methodologies.
PDCA AND 7 QUALITY TOOLS
Kaizen advocates usage of seven quality tools for problem solving. It also calls for using PDCA cycle for improvement of
processes. It encourages forming cross-functional teams for improvement. The team should identify improvement
opportunities and implement them by following the PDCA cycle for effectiveness. This will facilitate effective
implementation for improvement.
GOAL OF KAIZEN
The goal of Kaizen should also be clearly understood. Kaizen is a low cost approach to improvement, available to every
organization that has the determination to improve its processes for delighting customers. An organization should
recognize that improvement is never ending. Kaizen brings out improvements, which results in improved productivity,
efficiency, profitability and above all better quality of life of employees and satisfied customers.
Kaizen Implementation
The organizations embrace Kaizen in two ways as given below:
(i) Gradual improvement of processes
(ii) Kaizen Blitz
The first methodology is similar to what was discussed in chapter four. The management constitutes an Apex Quality
Council which overseas continual and gradual improvement in the processes. For each improvement project, specific
teams – PAT are constituted with specific goal. The improvement teams use the seven QC tools for problem solving.
They use 5S tools for reorganizing work places of the factory for their effectiveness. They reduce or eliminate three MUs.
They will use PDCA cycle to evolve and implement improvement plans. Thus, it is a long-term exercise for every process
improvement.
HERMINIA M. FONTANILLA
Instructor- OPERATION MANAGEMENT (TQM)
3
Kaizen Blitz Kaizen Blitz, on the contrary, is a quick improvement methodology. A large number of organizations
embark upon Kaizen Blitz (events) to unleash employee creativity and dramatically improve the operations overnight.
Usually the Kaizen Blitz is completed in a single week. The solutions are implemented quickly. A crossfunctional team is
formed comprising of managers, supervisors, workers and sometimes marketing and finance personnel and even
consultants. Kaizen Blitz teaches the core skills to the cross-functional team. Then the cross-functional teams apply the
core skills learnt on the processes. They look particularly at the incoming material, manufacturing set up, processes and
housekeeping.
Whether it is a Kaizen Blitz or Kaizen in the traditional sense, it involves the following:
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Application of 5S for improving workplace effectiveness
Reduction and finally elimination of three Mus
Standardization of effective methodologies for carrying out the work
5S PRACTICES
Kaizen is a carefully evolved strategy by Japanese for improved competitiveness of business. It is more than just a
tactical weapon. It is also a collection of tools. The Kaizen toolbox includes the 5S for improving workplace effectiveness.
5S is rather a management tool focused on fostering and sustaining high quality housekeeping.
The 5S practices are:
(i)
(ii)
(iii)
(iv)
(v)
Sort
Straighten
Scrub
Systematize
Standardize
The Japanese equivalent names for the five practices start with the alphabet ‘S’. Thus, these are known as 5S practices.
A perusal of these 5S practices (which are also called 5S tools), may give an impression that they are very simple and
mundane, but practicing them meticulously and correctly will definitely add to improvement of quality in the
organizations.
1. Seiri-Sort
The objective of seiri is to sort and throw away unnecessary items. Separate tools, machinery, products, inspection,
work in progress, and documentation into necessary and unnecessary and discard unnecessary item. This tool to is
decide about which organizing paper things. Every employee should decide what to discard, what to store and how to
store things, so that they can be accessed easily later. If the place is clean, naturally there will be more motivation to
carry out the jobs. The executive can classify items into the following categories:
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Low usage
Medium usage
High usage
Those items that are of low usage can be kept at far off places. The average usage items can be kept in a cupboard
nearby. The high usage items, which are frequently referred, could be kept closer to him neatly. Those, which will never
be required, are disposed off immediately. If this is followed for every paper or email that is received or item received, it
will improve the efficiency of the executive.
2. Seiton-Straighten
The purpose of this tool is to arrange necessary items in a neat, proper manner so that they can be easily retrieved for
use and to return them to their proper locations after use. For easy and fast access when needed, everything has a place
and everything in its place. Deciding to place items in different places depending upon the need is not going to improve
the efficiency, unless the things are arranged neatly and properly. The following could be adopted for enabling neatness
in the organization:
Step1 : Plan to arrange neatly The management should plan to arrange everything at the appropriate places in
appropriate manner. In the production floor, where quick turn around time is required, minutes wasted in taking
HERMINIA M. FONTANILLA
Instructor- OPERATION MANAGEMENT (TQM)
4
something and putting it back could cause a lot of wastage of man-hours. Always the problem lies in retrieving things.
Some of the problems in retrieving things are:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
Not knowing the correct name of the things
Not sure where things are kept
Storage site at a far off place
Storage sites scattered all around
Repeated visits to far off places for taking and putting back
Hard to locate the things since the box contains many other things
Storage location and items not labeled
Thing is not there, but not clear whether the stock is exhausted or somebody is having it
No distinction between good parts and defective parts, all look same
Too wide to carry
Too heavy to carry
No trolleys to carry huge items
Improper design of path ways with lot of obstructions
In the planning phase, appropriate places should be selected for storage of various items. If there are no written criteria,
then each person will have his own criteria and again they will take lot of time in retrieving things.
Step 2: Decide where things should be stored The organization should have a name for every item and a place for each
item to be stored. Similarly, each tool, each material, each document or file should have its address known to the users.
Such a scheme should be followed for every item in the organization. The following procedures should be adhered to:
1.
2.
3.
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Everything should have a name
A place for everything and everything in its place
Quick identification and retrieval mechanism
Frequent-use items should be retrievable easily
4. Safe storage / transfer
- Heavy things on the bottom
- Heavy things to be carried on trolleys
- Benches and ladders to be used wherever required
5. Height consideration for the storage of items depending on the frequency of their use.
Step 3: Be consistent in following the rules It should be the discipline on the part of the employees to follow the rules,
which they made for themselves. Whatever may be the problems, the tools or items should be put back at the places
marked for their storage.
3. Seiso-Scrub
The objective of Seiso tool is to clean and inspect the respective work places thoroughly, so that there is no dust on the
floor, machinery and equipment. Keep machinery and work environment clean.
The importance of cleaning need not be over emphasized. Employees in the organization should be responsible for
cleaning their own places. Periodic cleaning of their workbenches, cupboards, PCs, switchgears, etc. is essential.
Otherwise psychologically the employees will not be able to perform well.
4. Seiketsu-Systematize
The objective of this tool is to maintain high standards of work place organization by keeping everything clean and
orderly at all times. Develop routine practices for cleaning and checking. If the organization can systematize the 5S
processes, then it becomes easier for continuously and repeatedly maintaining the organization’s neatness and
cleanliness. This may call for visual management.
HERMINIA M. FONTANILLA
Instructor- OPERATION MANAGEMENT (TQM)
5
5. Shitsuke-Standardize
The objective of the last 5S tool is to make the previous four steps part of the daily routine and to observe self-discipline
through continuous practice. Follow procedures and standardize continuously to improve processes and reestablish
standards. Discipline is the fundamental requirement of success for any organization. Discipline will come only with
repeated instructions, coaching and training. The employee should be taught what should be done and what should not
be done. There is a need for systematic training and coaching for bringing in discipline. Employees should be coached
and tried out before actual deployment. This is same as Deming’s PDCA.
5S CERTIFICATION
National Productivity and Competitiveness Council (NPCC) of Mauritius offers 5S Certification. The NPCC Certification
was introduced in April 2002. It is aimed at developing and assisting the productivity cultureacrossMauritius.
NPCC 5S Certification: The Process
1. A team of 5 auditors will audit the Gemba (work place) proposed for certification. Three audits, spread over the
period of one year will be conducted.
2. The audited organization should keep the following relevant information:
 General background of the organization
 Sections or departments where 5S is applied
 Photographs of the section or department where 5S is applied
 Documented proof: support for structure for 5S (like a formal 5S coordinator), training on 5S conducted and
attendance sheets, standards (for colour codes, etc.) and proof of regular 5S activities
4. Following three random audits and on the basis of the audit report, eligibility of the 5S certification will be considered.
3. A certificate will be awarded by National Productivity and Competitiveness Council and Kaizen Institute (Africa, Asia
and Pacific) to any organization, which has successfully implemented 5S practices.
THE SEVEN DEADLY WASTES
Wastes cannot be totally eliminated but can be reduced to the minimum. Toyota, the Japanese automobile
manufacturer, identified the following seven types of wastes as the most common in industries.
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Waste from overproduction
Waste of waiting time
Transportation waste
Processing waste
Inventory waste
Waste of motion
Waste from product defect
We will discuss them briefly:
1. Overproduction Waste
This occurs due to failure of production planning when money is blocked in the unsold products. When the programming
language Java was popular before the bursting of dot COM bubble, an ambitious book supplier stocked large volume of
Java books. When there was a change in requirement and many copies were not sold, he had to close down the
organization.
2. Waste due to Waiting
Work-In-Progress (WIP) is a direct measure of quality of the organization. A product is nearly completed but waiting for
a particular part to arrive from another country. Hence the product cannot be shipped. This is WIP and an example of
waste due to waiting. This can occur at any stage of manufacturing due to poor planning, organizing as well as lack of
dynamism in making alternate arrangements when a particular man, machine or material is not available due to
unforeseen circumstances.
HERMINIA M. FONTANILLA
Instructor- OPERATION MANAGEMENT (TQM)
6
3. Transportation
Unnecessary transportation is a waste. Therefore, every assembly line should be under one roof preferably. The plant
layout should be organized such that there is no back and forth movement anywhere. If there is no conveyor, the goods
or semi-finished products should be transported using trolleys or carts. But the distance traveled should be kept at the
minimum.
4. Processing Waste
The machinery should be kept in smooth working condition by periodic and preventive maintenance to eliminate
processing waste. If a process is held up due to breakdown of the machinery, money is lost. Furthermore, appropriate
tools and fixtures should be provided so that the time taken for manufacturing is optimum. The design of the product
should be such as to enable easy manufacturability, testability and maintenance.
5. Inventory Waste
Supply chain management should be such that there are no excess materials. Similarly, the organization should produce
exact number of every part. Sometimes they produce a little more to take care of eventualities. Even such extra items
can become huge in due course of time, necessitating selling them as a scrap. In the stores also reorder levels should be
fixed for every item on scientific basis to avoid dead stock.
6. Waste of Motion
As Watts Humphrey says, the purpose of driving is to reach the destination on time and not to spin the wheel. This
happens if the person does not have the map. Similarly, if the workers are not trained in their job properly, there will be
lot of motion but no work. Searching for things, non-availability of the correct tools, not monitoring the running machine
etc. can cause wastage of lot of time.
7. Product Defects
The defective parts or supplies cause loss of money. Not only that, managing the scrap causes unnecessary work like,
safe custody, accounting, disposal as well as cause strain on the space available for good manufacturing. Thus
eliminating scrap through zero defects is the only solution to the problem.
BUSINESS PROCESS REENGINEERING (BPR)
What is BPR?
BPR is undertaken essentially to result in a quantum jump in performance of processes. BPR is synonymous with
innovation because it is more than just automating or applying Information Technology to the existing process or
operations. It will bring in benefits to all the stakeholders of the organization. Very high achievements are expected out
of BPR.
BPR is “the fundamental rethinking and radical design of business processes to achieve dramatic improvement in
critical, contemporary measures of performance, such as cost, quality, service, and speed”.
A dramatic improvement can take place only when the change in the process is radical and bold. Dramatic
improvements will only help the organization a leapfrog in performance or achievements.
Fundamental Rethinking
Dramatic improvements can take place through elimination of redundant operations, unnecessary operations and
operations, which add cost, but, not value to the products and services. BPR is an opportunity for innovative persons to
decide, after due considerations, which processes are redundant and make a recommendation accordingly to the
management.
Radical Redesign
Dramatic improvements cannot be achieved only through fundamental rethinking. It calls for design of new processes.
Some service organizations take 15 days to respond to an enquiry through fax. This is mainly because of the redundant
HERMINIA M. FONTANILLA
Instructor- OPERATION MANAGEMENT (TQM)
7
system established in the organization. Therefore, in order to reply to a query in half an hour time, the redundant
processes, processes that inhibit quick action and need unnecessary approvals etc. should be dispensed with.
How to Carry out Reengineering?
The steps involved in BPR are similar to those in TQM. However, in reengineering, much bigger results are expected and
not incremental improvements.
The five phases of reengineering cycle are given below:
1.
2.
3.
4.
5.
Planning
Process Study
Study of the best practices
Redesign
Implementation
This cycle repeats itself whenever the management wants dramatic improvements in the performance of the
organization. Reengineering does not fit in Kaizen. However, reengineering may be called for occasionally to make quick
and dramatic improvements in the process.
Information Technology
Some consultants give an impression that BPR means application of Information Technology (IT) only. No doubt,
application of IT will help in improvement of productivity, efficiency and quality of the work. However, IT alone cannot
result in dramatic improvement. IT has to be integrated into the redesigned process skillfully and logically. Simply buying
computers and asking people to make use of it, will not improve the performance. The computer should be used where
it is possible. Since, IT can reduce the monotony of people, the reengineering team can try to explore applications where
it could be gainfully employed.
BPR AND TQM
The aim of BPR is to make dramatic improvement in quality. There is a lot of debate as to whether BPR is an alternative
to TQM. Some proponents feel that TQM is outdated and BPR will replace TQM altogether. There are a lot of
misconceptions about BPR, vis-a-vis TQM. TQM is not only continuous improvement, but, has many other facets as given
in the various chapters. BPR is one of the tools to achieve TQM as discussed in this section.
The two approaches namely TQM and BPR neither contradicts nor compliments each other because they are two parts
of the same approach. AT&T illustrates this well in its reengineering handbook, which poists business reengineering as a
fundamental component of total quality approach. Therefore, total quality is an objective, TQM is a means to achieve it
and BPR is an important tool within the TQM technology. This observation makes the relationship between TQM and
BPR crystal clear. While BPR is a tool, TQM is an umbrella concept involving many other strategies.
Assessment
I. Multiple Choice. Choose the most appropriate answer.
1. 5S improves
a. Quality of the product and processes b. efficiency c. employee morale
d. All of these
2. Siere means
a. Throwing away all items b. Sorting in data base
c. Throwing away unnecessary items d. None of the above
3. Seiton means
a. applicable to waste also b. To arrange necessary items in a neat and proper manner
c. not part of 5S
4. Visual management is a part of
a. Seikatsu
b. Seiri
c. Seiton
d. Feigenbaum
HERMINIA M. FONTANILLA
Instructor- OPERATION MANAGEMENT (TQM)
8
5. 5S is
a. A part of Kaizen tools
b. Management tool
c. Used for inspection
d. All of the above
6. Kaizen is a technique for
a. Gradual improvement
b. Continuous improvement c. Does not require capital investment d. All of the above
7. Kaizen Blitz involves
a. Training of cross-functional teams
b. Carry out the job quickly
c. Aimed at dramatic improvement
d. All of the above
8. Kaizen is aimed at
a. Application of 5S
b. Standardization of processes c. Waste Elimination
d. All of the above
9. BPR is aimed at
a. Continuous improvement b. Gradual improvement
d. All of the above
10. Juran’s trilogy includes
a. Quality Planning
b. Quality Control
c. Radical redesign and dramatic improvement
c. Quality Improvement
d. All of the above
Test II.
True or False
1. Kaizen means dramatic improvement
2. BPR is a Kaizen tool
3. Standardization of methodologies is important to Kaizen
4. Kaizen Blitz is a quick improvement process
5. Juran trilogy aims at eliminating chronic waste
6. Seven deadly wastes improve processes
7. Lean manufacturing saves space
8. WIP is high in lean manufacturing
9. Visual management improves processes
10. Kaizen reduces costs
11. BPR aims at gradual improvement
FEEDBACK
How do you find this module?
References: Subburaj Ramasamy, Total Quality Management, International Edition,
McGraw-Hill Book Company Limited New Delhi, 2005.
HERMINIA M. FONTANILLA
Instructor- OPERATION MANAGEMENT (TQM)
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