1. Chapter 7
Process Management

2. Wisdom from Texas Instruments
“Unless you change the process, why would you expect the results to change”

3. Scope of Process Management
Process Management: planning and administering the activities – design, control, and improvement – necessary to achieve a high level of performance
Four types of key processes
Design processes
Production/delivery processes
Support processes
Supplier processes

4. Management Principles
AT&T Process
Management Principles
Focus on end-to-end process
Mindset of prevention and continuous improvement
Everyone manages a process at some level and is a customer and a supplier
Customer needs drive the process
Corrective action focuses on root cause
Process simplification reduces errors

5. Control vs. Improvement
Controlled
process
Improvement
Time
New zone
of control
Out-of-control

6. Leading Practices (1 of 2)
Translate customer requirements and internal capabilities into product and service design requirements early in the process
Ensure that quality is built into products and services and use appropriate tools during development
Manage product development process to enhance communication, reduce time, and ensure quality
Define, document, and manage important production/delivery and support processes

7. Leading Practices (2 of 2)
Define performance requirements for suppliers and ensure that they are met
Control the quality and operational performance of key processes and use systematic methods to identify variations, determine root causes, and make corrections
Continuously improve processes to achieve better quality, cycle time, and overall operational performance
Innovate to achieve breakthrough performance using benchmarking and reengineering

8. Product Development Paradigms
Traditional Approach
Design the product
Make the product
Sell the product
Deming’s Approach
Design the product
Make it with appropriate tests
Put it on the market
Conduct consumer research
Redesign with improvements

9. Product Development Process
Idea
generation
Concept
development
Product &
process design
Full-scale
production
Product
introduction
Market
evaluation

10. Quality Engineering System Design Parameter Design Tolerance Design
Functional performance
Parameter Design
Nominal dimensions
Tolerance Design
Tolerances

11. Loss Functions loss no loss nominal tolerance Traditional View
Taguchi’s
View

12. Taguchi Loss Function Calculations
L(x) = k(x - T)2
Example: Specification = .500  .020
Failure outside of the tolerance range costs $50
to repair. Thus, 50 = k(.020)2. Solving for k
yields k = 125,000. The loss function is:
L(x) = 125,000(x )2
Expected loss = k(2 + D2) where D is the deviation
from the target.

13. Design Objectives Cost, Manufacturability, Quality, Public Concerns
Tools and Approaches
Design for Manufacturability
Design for Environment

14. Streamlining Product Development
Competitive need for rapid product development
Concurrent engineering - a process in which all major functions involved with bringing a product to market are continuously involved with the product development from conception through sales
Design reviews

15. House of Quality Interrelationships Customer requirement
Technical requirements
Voice of
the
customer
Relationship
matrix
Technical requirement
priorities
Customer
requirement
Competitive
evaluation
Interrelationships

16. Quality Function Deployment
technical
requirements
component
characteristics
process
operations
quality plan

17. Motorola’s Approach to Process Design
Identify the product or service
Identify the customer
Identify the supplier
Identify the process
Mistake-proof the process
Develop measurements and control, and improvement goals.

18. Evaluating a Process Are steps arranged in logical sequence?
Do all steps add value? Can some be eliminated or added? Can some be combined? Should some be reordered?
Are capacities in balance?
What skills, equipment, and tools are required at each step?
At which points might errors occur and how can they be corrected?
At which points should quality be measured?
What procedures should employees follow where customer interaction occurs?

19. Projects
Project initiation – direction, priorities, limitations, and constraints
Project plan – blueprint and resources needed
Execution – produce deliverables
Close out – evaluate customer satisfaction and provide learning for future projects

20. Basic Components of Services
Physical facilities, processes, and procedures
Employee behavior
Employee professional
judgment

21. Key Service Dimensions
Customer contact and interaction
Labor intensity
Customization

22. Control A well-controlled system is predictable
The continuing process of evaluating process performance and taking corrective action when necessary
Components of control systems
Standard or goal
Means of measuring accomplishment
Comparison of results with the standard as a basis for corrective action
A well-controlled system is predictable

23. After Action Review What was supposed to happen?
What actually happened?
Why was there a difference?
What can we learn?

24. Supplier and Partnering Processes
Recognize the strategic importance of suppliers
Develop win-win relationships through partnerships
Establish trust through openness and honesty

25. Supplier Certification Systems
“Certified supplier” – one that, after extensive investigation, is found to supply material of such quality that routine testing on each lot received is unnecessary

26. Benefits of Effective Supplier Process Management
Reduced costs
Faster time to market
Increased access to technology
Reduced supplier risk
Improved quality

27. Process Improvement New approaches from the total quality movement
Productivity improvement
Work simplification
Planned methods change
Kaizen
Stretch goals
Benchmarking
Reengineering
Traditional Industrial Engineering
New approaches from the total quality movement

28. Kaizen Gradual and orderly continuous improvement
Minimal financial investment
Involvement of all employees
Exploit the knowledge and experience of workers

29. Agility
Flexibility – the ability to adapt quickly and effectively to changing requirements
Cycle time – the time it takes to accomplish one cycle of a process
Benefits
Improve customer response
Force process streamlining and simplification

30. Breakthrough Improvement
Discontinuous change resulting from innovative and creative thinking
Benchmarking – the search of industry best practices that lead to superior performance
Competitive benchmarking
Process benchmarking
Strategic benchmarking
Reengineering – radical redesign of processes

31. Process Management in the Baldrige Award Criteria
The Process Management Category examines the key aspects of an organization’s process management, including customer-focused design, product and service delivery, key business, and support processes. This Category encompasses all key processes and all work units.
6.1 Product and Service Processes
a. Design Processes
b. Production/Delivery Processes
6.2 Business Processes
6.3 Support Processes