Quality and Operations Management MS&E269 Malcolm Baldrige National Quality Award

Core Values Customer-driven Quality Leadership Continuous Improvement and Learning Employee Participation and Development Fast Response Design Quality and Prevention Long-range View of the Future Management by Fact Partnership Development Corporate Responsibility and Citizenship Results Orientation

Award Categories 1994 2001 Manufacturing Service Small Business 2 winners per category 2001 Business Service Small Business Education Health Care 3 winners per category

MBNQA Winners 1988—Motorola Inc., Commercial Nuclear Fuel Division of Westinghouse Electric Corp., and Globe Metallurgical Inc. 1990—Cadillac Motor Car Division, IBM Rochester, Federal Express Corp., and Wallace Co. Inc. 1992—AT&T Network Systems Group/ Transmission Systems Business Unit, Texas Instruments Inc. Defense Systems & Electronics Group, AT&T Universal Card Services, The Ritz-Carlton Hotel Co., and Granite Rock Co. 1994—AT&T Consumer Communications Services, GTE Directories Corp., and Wainwright Industries Inc. 1996—ADAC Laboratories, Dana Commercial Credit Corp., Custom Research Inc., and Trident Precision Manufacturing Inc. 1998—Boeing Airlift and Tanker Programs, Solar Turbines Inc., and Texas Nameplate Co., Inc. 2000—Dana Corp.-Spicer Driveshaft Division, KARLEE Company, Inc., Operations Management International, Inc., and Los Alamos National Bank 1989—Milliken & Co. and Xerox Corp. Business Products and Systems 1991—Solectron Corp., Zytec Corp., and Marlow Industries 1993—Eastman Chemical Co. and Ames Rubber Corp 1995—Armstrong World Industries Building Products Operation and Corning Telecommunications Products Division 1997—3M Dental Products Division, Solectron Corp., Merrill Lynch Credit Corp., and Xerox Business Services 1999—STMicroelectronics, Inc.-Region Americas, BI, The Ritz-Carlton Hotel Co., L.L.C., and Sunny Fresh Foods Service Manufacturing Small Business

Changing Award Criteria 1991 Leadership, 100 Information and Analysis, 70 Strategic Quality Planning, 60 Human Resource Util., 150 Quality Assurance of Products/Services, 140 Quality Results, 180 Customer Satisfaction, 300 1994 Leadership, 95 Information and Analysis, 75 Strategic Quality Planning, 60 Human Resource Devel., 150 Management of Process Quality, 140 Quality and Operational Results, 180 Customer Focus/Satis., 300

Changing Award Criteria 1995 Leadership, 90 Information and Analysis, 75 Strategic Planning, 55 Human Resource Devel. and Management , 140 Process Management, 140 Business Results, 250 Customer Focus/Satisfaction, 250 2001 Leadership, 120 Information and Analysis, 90 Strategic Planning, 85 Human Resource Focus, 85 Process Management, 85 Business Results, 450 Customer and Market Focus, 85

Criteria Characteristics Results oriented Non-prescriptive Assessment Diagnostic

A-D and R Approach Deployment Results how the application addresses the item appropriateness effectiveness evidence of innovation Deployment extent to which approach is applied use of approach in business requirements use of approach by all appropriate units Results outcomes current performance levels performance levels relative to comparisons/benchmarks rate and breadth of performance improvements demonstration of sustained improvement

Four Stage Review Process

Leadership 1.1 Senior Executive Leadership 1.2 Management for Quality 1.3 Public Responsibility and Corporate Citizenship

Leadership Values and Expectations Empowerment and Innovation Performance Reviews Findings and Improvement Regulatory, Legal, Ethical Responsibilities Support of Key Communities

Information and Analysis 2.1 Scope and Management of Quality and Performance Data and Information 2.2 Competitive Comparisons and Benchmarking 2.3 Analysis and Use of Company-level Data

Information and Analysis Selection and Integration of Measures / Indicators Comparative Data and Information Reliability Currency w.r.t. Changing Needs Senior Executive Reviews and Planning Functional-level Decisions Daily Operational Support

Strategic Quality Planning 3.1 Strategy Quality and Company Performance Planning Process 3.2 Quality and Performance Plans

Strategic Quality Planning Strategy Development Strategy Objectives and Timelines Actions Plans and Measures Human Resource Plans Performance Projections

Human Resource Development and Management 4.1 Human Resource Planning and Management 4.2 Employee Involvement 4.3 Employee Education and Training 4.4 Employee Performance and Recognition 4.5 Employee Well-being and Satisfaction

Human Resource Development and Management Short and Long Term Key Needs Employee Education, Training and Development Delivery and Reinforcement Safe Work Environment Support and Motivation Satisfaction Determination Improvement Priorities

Management of Process Quality 5.1 Design and Introduction of Quality Products and Services 5.2 Process Management: Product and Service Production and Delivery Processes 5.3 Process Management: Business and Support Service Processes 5.4 Supplier Quality 5.5 Quality Assessment

Management of Process Quality Design Processes Production and Delivery Processes Key Supplier Products and Services Key Support Processes Requirements and Measures Evaluation and Improvement

Quality and Operational Results 6.1 Product and Service Quality Results 6.2 Company Operational Results 6.3 Business and Support Service Results 6.4 Supplier Quality Results

Quality and Operational Results Customer Evaluations Operational, Financial and Market Performance Strategy-driven Results

Customer Focus and Satisfaction 7.1 Customer Expectations: Current and Future 7.2 Customer Relationship Management 7.3 Commitment to Customers 7.4 Customer Satisfaction Determination 7.5 Customer Satisfaction Results 7.6 Customer Satisfaction Comparison

Customer Focus and Satisfaction Customer Groups and Market Segments Listening and Learning Strategies Important Product and Service Features Business Needs and Directions Currency Accessibility and Complaint Management Building Relationships Competitive Performance

Leadership Symbolism Systems Results Issues is it talk or walk what is the visible role for management Systems Results hard to measure Issues is there to much going on at one time increase weight of category

Information and Analysis Key purposes Use of Info Sys to achieve quality goals Reporting/feedback to support quality Competitive Analysis/Benchmarks Approach and deployment orientation Key is the choice of indicators to track and relationship to critical business drivers Applicant can improve scores simply through wordsmanship, clarity of submission During site visit easier to observe actuals than statements on application

Strategic Quality Planning Category design intent: aggressive, concrete goals, short term / long term horizontal and vertical integration Expect to see documented fundamentals Demonstrated understanding of industry On-site review best at determining validity of submission Shortcoming: deployment to suppliers Long-term planning not concrete wrt to rollout and method Components are satisfactory, burden on Great Northern Need more emphasis on long-term success and results

Human Resource Development Does the documentation match / support the results too much on deployment, not enough on results “50 ways to please a …” What about near-term programs? Timeline on result goals not clear Overly focused on individuals vs. teams Results and categories are ambiguous Warm fuzzies or real processes? Wish upon a star Needs and feelings survey How can tangible evidence be demonstrated?

Management of Process Quality Rationale: is process preventive or reactive Design of service/product offerings Monitoring matrix Pushed down to each department Use of analysis tools -- business process mapping Processes in place BLERA QSEG BLI Use of mainstream process management methods Recommendations, timelines, champions identified weak on follow-up

Quality and Operational Analysis System represents linking performance results to quality progress Repetition in indicators Overall completeness lacking weakness on benchmarking Can metrics be compared across industries?

Customer Focus and Satisfaction Relative balance in 1994 between AD & R Looking for commitment, proactive behaviors Are results comprehensive wrt all numbers and metrics? Who determines what the correct response level is vs. customer expectations and comparisons to industry Focus is based on own customers, hence how do you apply and compare benchmark data with different populations