QP

Putting Best Practices to Work www.qualityprogress.com | June 2010

Quality Progress | june 2010 Supply chain management

Innovation:
Encourage It p. 38
Implement It p. 30

QUALITY PROGRESS

Hitting the Mark

Target streamlines its complex
supply chain p. 22
Volume 43/Number 6
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Contents
Putting Best Practices to Work | June 2010 | www.qualityprogress.com

16

FEATURES
22 SUPPLY CHAIN MANAGEMENT
Bull’s-eye
Target closely manages its suppliers to ensure store-brand items
are safely produced and efficiently delivered to store shelves.
by William H. Murphy

30 innovation
Now What?
A New Mexico health system discovered how to replicate a successful
project and ensure it would be implemented—correctly and

22
consistently—at multiple sites.
by Clark Carboneau, Jon Banks, Tony Armijo and John A. Zondlo

38 What’s the Big Idea?

Great innovators aren’t always born. They can be made—with the right
training and commitment from employers.
by Aditya Bhalla

44 BALANCED SCORECARD
Added Traction
Increase your balanced scorecard’s potency by incorporating quality
tools and continuous improvement methods into the system. Only @
www.qualityprogress.com
by Alex Fedotowsky

• “Added Traction” Add-ons

Three online tables illustrate a
new balanced scorecard method (p. 44).

• Now More Insight

Examples of a control plan
and a service level agreement
accompany “Now What?” (p. 30).

• Ready Reference
Tools and information on quality
fundamentals, including a
comprehensive glossary of
quality terms.

38
 DEPARTMENTS

12
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Expert Answers
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• Structuring a quality department.
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6 Up Front 55 Career Corner
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68 ASQ’s SOFTWARE showcase

and DIRECTORY p. 61
Membership and Subscriptions
For more than 60 years, ASQ has been the
worldwide provider of information and learn-
ing opportunities related to quality. In addi-
tion, ASQ membership offers information,
NEXT MONTH networking, certification and educational
opportunities to help quality profession-
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Executives on maintaining quality. Enhance the value of quality tools. problems they face each day. Subscriptions
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application on p. 71.
ASQ’s Vision: By making quality a global priority, an organizational imperative and
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4 QP • www.qualityprogress.com
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For a list of all books from ASQ Quality Press, visit www.asq.org/quality-press.
 upfront

Gains and Pains

QP
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William A. Tony
QUALITY PROGRESS

Executive Editor and

A check: quality progress in the 21st century Associate Publisher
Seiche Sanders

Associate Editor
Poor qualitY in the form of unsanitary conditions, careless maintenance—and ques- Mark Edmund
tionable contingency planning—even the mishandling of a customer complaint can result Assistant Editor
in anything from the bruising of a customer’s loyalty to heart sickness to maybe just plain Brett Krzykowski

sickness. manuscript Coordinator

An unprecedented oil spill, tainted lettuce and recalled children’s medicine were among Valerie Ellifson

the quality-related headlines last month. Ten years in, has what Joseph M. Juran predicted CONTRIBUTING EDITOR
Nicole Adrian
would be “the Century of Quality” lived up to this lofty title? What would Juran say about
today’s state of affairs? COPY EDITOR
Susan E. Daniels
“In the 1990s—and it will extend well into the next century—we’re going to see the West
scaling up its quality revolution,” Juran predicted in a February 1999 Quality Digest inter- Art Director
Mary Uttech
view. “My belief is that historians in later decades will look back on the 21st century as the
Graphic Designer
Century of Quality, much as the 20th century has been the Century of Productivity, largely Sandy Wyss
following Frederick Taylor’s model.”
Production
It’s easy to question our progress when quality-related lapses and missteps seem so prev- Cathy Schnackenberg
alent. Yet, there are many places where quality flourishes. Many of those stories are featured Advertising production
in QP each month, and June is no exception. This month’s cover story, “Bull’s-eye,” p.22, Barbara Mitrovic

showcases the supply chain efficiencies achieved by retail giant Target via its well-executed Digital Production specialists
Eric Berna, Laura Franceschi
quality plans and systems. High standards for its supply chain partners lead to high-quality
products arriving on Target’s store shelves quickly and efficiently. Media sales
Naylor LLC
You’ll also find articles that offer insights and ideas that can help you build, refine and Lou Brandow
maximize your own quality projects and plans. “What’s the Big Idea?” (p. 38) explains how Krys D’Antonio
Norbert Musial
companies can cultivate innovative thinking among employees—it doesn’t need to be some-
Marketing Administrator
thing someone either has, or they don’t. Matt Meinholz
“Now What?” (p. 30) discusses replicating quality successes throughout a system. Presby-
Editorial offices
terian Healthcare System is the basis for this case study on a “dissemination project.” The Phone: 414-272-8575
Fax: 414-272-1734
teachings can be applied to just about any industry.
I feel lucky to be able to hear and read about quality triumphs every day as part of my Advertising offices
Phone: 866-277-5666
job. Even better, you get to play a role in many of these stories. QP is here to help you in
your charge—to grow, learn, and do your job better, smarter and quicker. If you have a suc- ASQ administration
Executive Director
cess or story to share, consider writing for QP. Paul E. Borawski
Now, I pose this question to you: Where do you think we stand in relation to Juran’s vi- Managing Directors
sion for the Century of Quality? Do you think it’s achievable? Are we there yet? Will we ever Christopher D. Bauman
Julie Gabelmann
be? Write to me at editor@asq.org. Brian J. Lehouillier
Michelle Mason
There are only 90 more years to make Juran’s vision a reality. We best get to work. QP Laurel Nelson-Rowe

To promote discussion of issues in the field of quality and

ensure coverage of all responsible points of view, Quality
Progress publishes articles representing conflicting and minor-
ity views. Opinions expressed are those of the authors and not
necessarily of ASQ or Quality Progress. Use of the ASQ logo in
Seiche Sanders advertisements does not necessarily constitute endorsement of
that particular product or service by ASQ.
Editor

6 QP • www.qualityprogress.com
2011 World Conference on
Quality and Improvement

CALL FOR PAPERS

ASQ invites you to join us and share in our efforts to promote, advocate, and CALL FOR TEAM ENTRIES
demonstrate the contributions quality can make to business, the community,
and the world. The Society is developing the 2011 World Conference on
See how your team compares to the best and
Quality and Improvement and is looking specifically for presentations that can get the recognition your company deserves!
integrate the conference theme with one or more of the focus areas outlined Finalists will be selected for the only live team
below. We invite you to share your best practices, successes, and proven recognition process of its kind to be held at
techniques to an audience representing an array of countries, backgrounds, ASQ’s 2011 World Conference. Preliminary
and industries. round entries are due September 13, 2010. For
more information, please visit wcqi.asq.org or
email gbalagopal@asq.org.
THEME
The New Role of Quality: Tomorrow’s
Applications of Proven Quality Tools
Today’s challenges have brought many to re-examine the role that quality can
play in the organizations and communities that we work and live in. In the face
of these challenges, some people are getting back to the basics, and others
are looking for innovation and creativity to pave the way. Today, more than
ever, quality has a role to play. Whether traditional or new, conservative or
inventive, quality is critical.

FOCUS AREAS
• Global • Organizational Excellence
• Risk Management • Quality Basics
• Building a Quality Culture

SUBMIT YOUR PAPER AT wcqi.asq.org. THE SUBMISSION DEADLINE IS AUGUST 2, 2010.

 INBox QP
CHAIR OF THE BOARD
QUALITY PROGRESS

Designing quality Strategy shift

QP
Putting Best Practices to Work www.qualityprogress.com | April 2010

QUALITY PRoGRESS | APRIL 2010

Roberto M. Saco, Aporia Advisors Inc.

I read with interest the April is- I am writing to comment on
sue of QP and the many articles Henry Lindborg’s Career Corner PRESIDENT
QUALITY PROGRESS
Peter L. Andres, the Boeing Co.
regarding the quality problems Car column, “Lesson Learned,” in
PRESIDENT-ELECT
LEARNING FRoM ToYoTA’S TRoUBLES

Toyota is having. I saw very little Trouble

Toyota’s roadmap to
the April 2010 issue (pp. 56-57). E. David Spong, the Boeing Co. (retired)
discussion regarding quality of recovery—and the Toyota’s troubles are significant
lessons we can
learn p. 16 TREASURER
design, which appears to be the Plus:
A Critical Look at
Root Cause p. 32
for quality professionals, but James J. Rooney, ABS Consulting
root cause of most of Toyota’s MillerCoors Uses Stats
To Deliver Efficiency p. 38 not in the way you might think.
PARLIAMENTARIAN
current quality problems, in- Quality at Toyota, in the form of Karla Riesinger, ASQ
VoLUME 43/NUMBER 4

cluding the stability-control is- the infamous TPS, did not cause DIRECTORS
sues of its Lexus GX 460 premium SUV. the current problems at the automaker. Lloyd O. Barker, Alcoa
Belinda Chavez, United Space Alliance.
The Toyota Production System (TPS) What appears to have happened is that Darlene Stoddard Deane, Ford Motor Co.
Herbert Goldstein, Ortho-Clinical Diagnostics
focuses on conformance to the design, not Toyota changed its strategy from mak-
Alexis P. Goncalves, Innovation Insight Network
determining that the design is fit for use ing the best (highest-quality) cars in the Richard A. Gould, RG Management Solutions
Harold P. Greenberg, American Certification
and foolproof. What the TPS guarantees world to being the biggest automaker in Corp.
is that when a design deficiency exists, the world. In the process, it unintention- Clayburn W. Hodges, Wachovia
Joni Judd, J&L Analytical Services
all of the products will have the design ally drove home a different set of cultural Marc P. Kelemen, NanoSynopsis
Kay A. Kendall, BaldrigeCoach
deficiency. behaviors that resulted in the woes that Lou Ann Lathrop, General Motors
As a solution, several writers mentioned played out so publicly in recent months. Richard A. Perlman, Bayer HealthCare
Aimee H. Siegler, Benchmark Electronics
a robust system for customer feedback. How did this happen? As business con- Arthur Trepanier, Lockheed Martin
Steven E. Wilson, U.S. Department of Commerce
While I support such systems, they are sultant and author Jim Collins points out in
Seafood Inspection Program
reactive in nature. If the manufacturer uses many of his books, it is one thing to achieve
QP EDITORIAL REVIEW BOARD
the system to identify design deficiencies, a certain level of organizational excellence Randy Brull, chair
the lag time is extreme. It is best suited for and another to maintain it over time. It is a
Administrative Committee
addressing the softer areas of customer characteristically human trait to relax after Brady Boggs, Randy Brull, Jane Campanizzi,
Larry Haugh, Jim Jaquess, Gary MacLean,
dissatisfaction, not to identify significant achieving a goal.
R. Dan Reid, Christine Robinson, Richard
product deficiencies. It may be that after years of focusing on Stump
Having worked in the automotive and quality as a strategy to differentiate its prod- Technical reviewers
aerospace industries, I can assure you the uct and drive growth, Toyota executives felt I. Elaine Allen, Andy Barnett, David Bonyuet,
John Brown, Bernie Carpenter, Ken Cogan,
former has much to learn from the latter they had mastered quality and could move Linda Cubalchini-Travis, Ahmad Elshennawy,
Tim Folkerts, Eric Furness, Mark Gavoor,
when it comes to ensuring design quality. on to the strategy of being the largest auto- Kunita Gear, Lynne Hare, Ron Kenett, Ray
This raises the topic of software design, maker. In doing so, they reduced quality to Klotz, Tom Kubiak, William LaFollette, Shin
Ta Liu, Pradip Mehta, Gene Placzkowski,
redundancy and quality assurance. an operational—or worse, a tactical—initia- Paul Plsek, Tony Polito, Peter Pylipow, Philip
As automobiles become computers with tive within the organization. The unintended Ramsey, R. Dan Reid, Wayne Reynolds, John
Richards, James J. Rooney, Anil Sengupta,
wheels, it behooves the automotive industry consequence of such a change in strategy is Sunil Thawani, Joe Tunner, Jeffrey Vaks, Manu
Vora, Jack Westfall, James Zurn
to implement a robust software quality as- that people may do things under a strategy
surance program. The industry can benefit of “be the biggest” that they may not do
by studying and adopting the standards and under a strategy of “be the best.”
work of the International Aerospace Quality Toyota made its reputation on quality,
Group, which addresses design quality with and that is what most people remember.
the same intensity as conformance. Sadly, the implication of this for quality pro-
Gene Barker fessionals may be the erroneous connec-
Kent, WA tion in people’s minds that quality caused

8 QP • www.qualityprogress.com
the current problems—or did not uncover
them—or that Toyota no longer makes a
quality product.
Clearly, something changed in the sys-
tem. And while quality—in the form of the
TPS and the Toyota Way—did not cause the
problems, quality tools and techniques can
be used to uncover and fix the root causes.
Leaders determine the strategy of an
organization and focus everyone on ac-
complishing it. The lesson for leaders is to
be careful what you focus on, because you
may get more than you bargained for from
your followers.
Michael P. Levy
Washington, D.C.
Cause and effect fallacies
In the April 2010 article “Under Scrutiny”
(pp. 32-37), Mark Paradies writes that cause
and effect analysis has “major shortcom-
ings.” One of these, he says, is that people
jump to conclusions and only look for
information that confirms their theory.
This can be
true, but it is not
how root cause
analysis
be
should
conducted, Under
Scrutiny
and it is not how
the items that may be causing dispersion Too simple?
are included.” In the article “Under Scrutiny,” Paradies
Usually, there are several root causes to makes a good point regarding the overly
any problem. What Paradies failed to men- simplistic single causal chain application
tion is the use of Pareto analysis, which of the five whys technique, but he does so
allows the major causes to be addressed by implying that problems occur without
and the main impact of the problem to be cause, and then goes on to posit that the
resolved. For more than 20 years, people root cause is the absence of a best practice
have been solving many problems and im- and knowledge. This seems like another
proving quality this way, even though they simplistic single cause to me.
didn’t find all the root causes. Dismissing a useful technique because it
What is more disturbing is that Paradies may be misused seems ill advised. It makes
writes, “Human performance issues (hu- sense to ask the whys for a variety of
man errors) cause most quality problems.” potential causation paths and use fishbone
I once heard W. Edwards Deming say only diagramming, which is based on the notion
6% of the quality problems are caused by there are many potential root causes.
frontline workers. Deming said the workers In the article, Paradies references
are “handicapped by the system, and the the fishbone diagram as one of the old
system belongs to management.” methods, even though effective use of the
Because managers are human, I sup- fishbone approach does exactly what he
pose it still fits that errors are caused suggests in his new method, which is far
by humans. But Deming said one of the from anything new.
main obstacles to improving quality is to The point of problem resolution is—and
blame the workers, and problem-solving has been for centuries—to understand the
ROOT CAUSE ANALYSIS
efforts should problem, identify potential causes, single
be focused on out the actionable ones, plan, act and
processes and adjust.
New approach to root
systems, not
the people. To
Problems arise from causes and condi-
tions. It is the problem solver’s job to find
cause analysis can help
clear up misconceptions
FOR MANY YEARS, quality improvement practitioners have been
attribute all those causes and conditions, and come up
taught to find root causes of problems by using a set of tools based on the

I was taught to
In 50 Words
Or Less
• Cause and effect analysis
has inherent limitations
quality problems with a solution that addresses them. The
theory of cause and effect. These tools include the five whys and fishbone
diagrams. Many users of these techniques, however, find that some problems,
by Mark Paradies
especially those caused by human error, keep happening.
Because of the failure of these techniques to stop problems, some problem

do it. The same to human error problem solver must not lose track of the
that may result in root solvers might start wondering:
cause analysis misconcep- • Am I using the tools correctly?
tions and hinder problem-
solving efforts. • Is there a misconception in using cause and effect to find the root
• Problem solvers need help
analyzing human perfor- causes of problems that produces unacceptable results?
mance issues. • Is there another technique to help me go beyond basic cause and

argument can be moves the focus reality that in complex systems, you can
• A new definition of root
cause could help people effect analysis and get better results when investigating quality issues?
realize a systematic pro-
cess beyond cause and If you use cause and effect to find root causes, you might want to rethink
effect is needed for root
your beliefs on this concept and look at what some consider to be misconcep-
cause analysis.
tions in applying commonly taught root cause analysis techniques.

made about any April 2010 • QP 33

problem-solving
or research effort, including the new cause
and effect analysis he proposes.
He also writes that people look for one
root cause, missing the possibility of other
causes. That is not how I was taught, nor
is it how I train people to do it. In Guide to
Quality Control, Kaoru Ishikawa specifically
instructed practitioners to be “certain all
away from the never be sure of the effect any action may
processes. have. Often, there is interplay among a
Paradies tries to prove the misconcep- variety of causes and conditions.
tions of cause and effect analyses, and We also should be aware we cannot
suggests some improvements. In my view, wait until all cause possibilities are identi-
these improvements have always been fied. Many root causes are not actionable.
part of effective cause and effect analysis. I Analysis overkill is just as debilitating as
guess it depends on how you’re taught. jumping to false conclusions.
Dennis Sowards George Pitagorsky
Mesa, AZ New York

June 2010 • QP 9
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 expertanswe
A change is coming
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than manufacturing. Where do I begin?
Submitted via QP reader survey
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time, I have observed a couple of truisms.
First, the manufacturing sector is about
20 years ahead of the service industry in
its quality journey. This comes from my
firsthand experience in the service realm,
where a manufacturing quality profes-
sional’s knowledge and experience are
quite valuable.
Second, finding a coach to help you
with the transition is helpful—and almost
a necessity. I figured out the transition on
my own, but it was not easy to shift to a
new industry, and I made mistakes along
the way. Considering some of the following
points might make the transition easier.
My transition into the industry began in
September 1999, when I received a phone
call from a former supervisor who had left
the company and started a consulting firm
with another colleague.
They were working with a major financial
institution in North Carolina, which led him
to ask me what I thought about going to
work for a bank. My answer: I didn’t think
much of it, and I didn’t know anything about
banking. After I went to the bank’s website,
however, I saw there could be a fit. The rest
is history, and I’m glad I made the transition.
The takeaway here is effective network-
ing can be the catalyst for an industry
change. Never burn bridges, and keep all of
your relationships healthy. I owe my transi-
tion to financial services to my former boss.
12 QP • www.qualityprogress.com
Maybe the best way to get your name
out there is to speak at conferences. I have
registered with a national organization and
have presented multiple times—locally and
nationally. In addition, organizations regu-
larly post requests for speakers or papers
on their websites.
Another way to make professional con-
nections is by participating in quality award
programs. I was involved with the Malcolm
Baldrige National Quality Award for four
years and made contacts in many differ-
ent areas, particularly in industries outside
manufacturing.
Effective networking can be the
catalyst for an industry change.
Writing magazine articles and columns is
another good way to network. I began my
working relationship with QP as a member
of its editorial board. After reviewing several
articles, I tried writing one of my own. Since
then, I’ve contributed a handful of articles to
ASQ and another national organization, an
exercise that has been very rewarding and
an excellent way to stay sharp.
Participation in professional social
networking sites is another excellent way
to network, keep up with your old contacts
and leverage them for future opportunities.
These websites are just like your resume
in that they need to be kept current with
recent accomplishments and added job
responsibilities.
One particular networking site, LinkedIn,
allows you to recommend colleagues. Tak-
ing the time to do this for your contacts is
an excellent favor to do for someone. And
don’t hesitate to ask someone you know
for a recommendation.
Since moving from manufacturing to
service 11 years ago, I’ve learned there
are two critical components to the transi-
tion. One involves a coach, and the other
involves an exercise.
Having a coach to help with the transi-
tion is crucial. I quickly realized there were
abundant opportunities to have a significant
impact on my company in the quality area.
What I did not have was someone caution-
ing me to take it slowly and to be pragmatic.
After making the transition, you may
see—as I did—that while there are impact
areas at every turn, the company may not
be ready for change, and your bosses may
not see the need for a quality system.
To find your way through new oppor-
tunities, I suggest writing a white paper
outlining your value proposition and articu-
lating your value to the new company.
In my case, the white paper was a
roadmap and, later, the basis for several
magazine articles. There was nothing earth
shattering in the content. Rather, the funda-
mental approaches to quality—the things
that made me successful in manufactur-
ing—were highlighted, emphasized and
simplified. The secret was to keep things
simple, pragmatic and incremental.
Taking the time to put together a similar
paper will give you experience with articulat-
ing your value proposition. This will help you
be succinct in future job interviews, thus not
overwhelming prospective employers.
Another key lesson is that what is
perfect can be the enemy of what is good.
Knowing how to cherry-pick elements of a
rs
quality system rather than implementing a A: You mention you already have experi-
full-blown system helped get management ence organizing quality departments and
on board. It was easy for them to digest the that the programs have been successful.
quick-hit value add of a particular area with- You know what works, and that probably
out getting bogged down in the details of a adds to the frustration in your current
wholesale quality system implementation. situation because you are being told to do
To summarize, it boils down to network- something different.
ing and knowing your value proposition. To answer your question, there is no
These two things can facilitate your transi- universally accepted written guideline for
tion out of manufacturing into a different organizing a quality department. Many orga-
industry. Here’s wishing you the best of luck nizations build their quality organization on
with a successful search and transition. the ISO 9000 standard, which will ensure
Keith Wagoner your department has critical policies and
Director, continuous improvement procedures in place. But effective manage-
Lincoln Financial Group ment must go beyond those requirements.
Greensboro, NC I suggest you consider reviewing ASQ’s
body of knowledge (BoK) for certified qual-
Reference ity managers. The ASQ BoK is not as widely
1. Bureau of Economic Analysis, “Gross Domestic Product:
First Quarter 2009 (Final),” www.bea.gov/newsreleases/ recognized or accepted as the ISO stan-
national/gdp/2009/pdf/gdp109f.pdf.
dards, but it may provide the level of detail
Get organized you seek. Compare your department’s
Q: I have 30 years of experience with qual- structures, systems and activities against
ity assurance and quality control (QA/QC) in the BoK requirements to assess the vitality
the government service industry, as well as of your department.
with regional quality management. I have In a perfect world, you could persuade
organized quality departments in which your boss to participate in this assessment
accountability is to clients first—working with you. You will both benefit because
as a change agent on their behalf—and the you will be working with an objective
president or CEO second. The programs I standard. You mentioned your boss does
have managed have been successful. not understand TQM, so the process will be
The problem I face now is that manage- informative for him and perhaps make him
ment does not understand total quality man- less likely to dictate.
agement (TQM) and is dictating to me. As a If your quality systems are already
result, quality is a dumping ground for other strong, you will benefit because your boss
people’s work. Is there a guideline written will see evidence of your efforts during the
on how to organize a QA/QC department? assessment. If weaknesses and gaps are
Abu Nasser identified, work with your boss to formu-
Columbus, OH late an improvement plan.
Asked and Answered
Sooner or later, everyone runs into a problem they can’t solve alone. Let us help.
Submit your question at www.qualityprogress.com, or send it to editor@asq.org,
and our subject matter experts will help you find a solution.
It is unfortunate your department has
become a dumping ground. As quality pro-
fessionals, we recognize the necessity of
a technically competent staff. If your boss
is willing to participate in the assessment,
he may gain a deeper awareness and
appreciation for the experience and skill
levels required to run a successful quality
organization.
As the quality manager, you play a critical
leadership role within the larger organiza-
tion. You will need to work with your man-
agement peers to ensure work assignments
are performed by the appropriate depart-
ment. For example, your staff should not be
responsible for process design, but you can
provide support for design reviews and per-
haps lead process improvement initiatives.
Based on your many years of experi-
ence, you may expect certain things and
take other things for granted. Some of your
peers may not have the benefit of prior
experience working with a world-class
quality organization. Be patient and work
with them as a partner.
You may want to try having candid
one-on-one conversations with the other
managers to determine whether there are
negative perceptions regarding you or your
staff. Perceptions are hard to overcome,
but if the issues are not addressed, they
will inevitably find their way to your boss
and trigger another round of negative
feedback. Some of the toughest problems
we face as quality professionals are not
technical, but instead are political and
interpersonal.
Andy Barnett
Consultant, Master Black Belt
Houston
For More Information
Westcott, Russell T. (editor), The Certified Manager of Quality/
Organizational Excellence Handbook, third edition, ASQ
Quality Press, 2006.
June 2010 • QP 13
 keepingcurre
product safety
Bad Medicine
F
Recall is the latest hit for Tylenol maker
For almost 28 years, anyone talking about
how best to handle a product recall inevi-
tably mentioned Johnson & Johnson—the
company behind a variety of over-the-coun-
ter medications, including Tylenol.
But the basis for that mention—the
tampering crisis in 1982—is starting to look
like a pebble compared with the mountain
of problems that have emerged in the last
few months.
Nearly 30 years ago, the drugmaker
sprang to action when cyanide-laced cap-
sules of Tylenol Extra Strength killed seven
people in the Chicago area. The company
recalled 31 million bottles of the drug and,
two months later, relaunched the product
with tamper-proof packaging and a media
blitz touting its commitment to safety. The
tab for the recall and relaunch topped $100
million. The payoff was a market share that
went from 7% immediately after the recall
to 30% a year later.1
But those heroic efforts are history,
replaced most recently by a sweeping recall
of a variety of children’s medications. And un-
like the 1982 incident, when the bottles were
tampered with post-production, this time the
company has nobody but itself to blame.
The root of the problem was a plant in
Fort Washington, PA, operated by McNeil
Consumer Healthcare, a unit of Johnson
& Johnson. The plant was already in the
crosshairs of the U.S. Food and Drug Admin-
istration (FDA), which had it under a more
rigorous inspection schedule since 2008.2
That proved to be a telling move, as the
plant’s latest inspection in April revealed a
list of issues that surfaced in an FDA report:
• After receiving 46 consumer complaints
between June 2009 and April 2010 about
foreign materials in its drugs, McNeil
14 QP • www.qualityprogress.com
failed to initiate “corrective and
preventive action.”
• Quality control procedures were
not followed, and lab facilities
were inadequate for testing and
approving products.
• Plant employees were not
trained in “current good manu-
facturing practices.”
• Pieces of equipment were lay-
ered with dust, and others were
patched together with duct tape.
• McNeil knowingly bought con-
taminated raw material from suppliers.
The bacteria, later identified as Burkhold-
eria cepacia, was discovered on drums
the supplier used to transport raw mate-
rials, but McNeil said those drums never
reached the plant in Fort Washington.3
“Remaining drums from that lot were
sent to us, all of which tested negative for
bacteria. Samples of finished product also
tested negative,” said Johnson & Johnson
spokesman Marc Boston. The FDA inspec-
tion reported a different result, however, as
the agency identified a handful of contami-
nated drums at the Fort Washington facility.4
The agency said—and testing con-
firmed—that no suspect material was used
to manufacture any of the recalled prod-
ucts. But the potential for contamination led
the FDA to recommend a recall—McNeil’s
fourth since September 2009, when chil-
dren’s Tylenol liquid products were pulled
due to a substandard ingredient.
That had consumers running for generic
brands and looking for answers that were
tough to come by in the days following the
most recent recall. Complaints rolled in
about the company’s recall website, people
struggled to reach customer service repre-
sentatives on the recall hotline, and those
who did get through were offered coupons
rather than refunds.
The company quickly added more infor-
mation to the website and staff members
to man the phones, but that didn’t quell the
frustrations of parents who were forced to
toss their children’s Tylenol products for the
second time in less than a year.
“It makes me question their quality con-
trol,” said Mark Mandel, a microbiologist at
Northwestern University’s Feinberg School
of Medicine in Chicago and father of a
21-month-old daughter. “It makes me won-
der if they have the parents’ best interest
and the children’s best interest at heart.”5
—Brett Krzykowski, assistant editor
References
1. Judith Rehak, “Tylenol Made a Hero of Johnson & Johnson,”
New York Times, March 23, 2002.
2. Alison Young, “Tylenol Recall Puts Drug Plant Inspection on
Fast Track,” USA Today, May 6, 2010.
3. Parija Kavilanz, “Children’s Tylenol Recall: FDA Slams
Factory Conditions,” http://money.cnn.com/2010/05/04/
news/companies/tylenol_recall_fda_inspection_report,
May 6, 2010.
4. Parija Kavilanz, “Bacteria Identified in Tylenol Recall,” http://
money.cnn.com/2010/05/05/news/companies/childrens_
tylenol_recall_bacteria/index.htm, May 6, 2010.
5. Natasha Singer, “Tylenol, Generics and Trust,” New York
Times, May 2, 2010.
nt
healthcare
public health, food standards
addressed at recent USP event
Editor’s note: The U.S. Pharmacopeial
Convention (USP) is a scientific, non-
profit, standards-setting organization that
advances public health through public
standards and related programs to help
ensure the quality, safety and benefit of
medicines and foods. Don Singer, a qual-
ity scientist in the pharmaceutical and
foods industries for more than 30 years,
attended the USP’s recent membership
meeting as an ASQ delegate and compiled
this report. Singer has been a member of
ASQ’s Food, Drug and Cosmetics Division
for 29 years and is a certified pharma-
ceutical good manufacturing practice
professional. He is also a former member
of ASQ’s board of directors.
Patient care and key collaborations among
USP and its partners to develop quality
standards in medicine were the main
topics discussed at the recent USP 2010
Membership Meeting.
Top officials from organizations that
actively partner with USP offered keynote
Mr. Pareto Head By Mike Crossen
speeches and discussion to empower USP
members to continue addressing public
health issues related to health, medicines,
drug and food ingredients, and standards
for drugs, food ingredients and dietary
supplements. About 500 people attended
the event.
Margaret Hamburg, M.D., commissioner
of the U.S. Food and Drug Administration
(FDA), expressed confidence in the part-
nership the FDA and USP have in promot-
ing a common public health mission and
addressing public health issues relating to
quality standards of drugs, foods and their
ingredients, especially in recent years. The
commissioner also praised USP’s global
reach, which can become influential when
“working with counterpart agencies and
industries overseas to help establish
science-based quality standards.”
Michael Maves, M.D., CEO of the
American Medical Association, addressed
the importance of shared interests in drug
standards, Medicare, drug naming, dietary
supplement quality and patient safety.
(continued on p.16)
standards
ISO releases
new toy safety
standards
Two new standards related to reduc-
ing the risk of children being injured by
unsafe toys, playground equipment or
dangerous substances have been ap-
proved by the International Organization
for Standardization (ISO).
The standards are additions to
the ISO 8124 Safety of toys series of
standards. Part 3: Migration of certain
elements spells out the maximum
acceptable levels of dangerous sub-
stances such as arsenic, cadmium, lead,
mercury and other materials possibly
found in toys.
Part 4: Swings, slides and similar
activity toys for indoor and outdoor fam-
ily domestic use details requirements
and testing methods for the children’s
equipment.
For more information about the
new standards, visit www.iso.org/iso/
pressrelease.htm?refid=Ref1319 (case
sensitive).
June 2010 • QP 15
 keepingcurrent
dateinqualityhistory
QP looks back on a person or event
that made a difference in the history of
quality.
June 18, 1887
E.H. Waloddi Weibull, a Swedish engi-
neer, scientist and manufacturer and
the namesake of Weibull distribution,
was born on this date.
He began his career in the Royal
Swedish Coast Guard in 1904 and
eventually achieved the rank of major
in 1940. During that time, he also took
courses at the Royal Institute of Tech-
nology in Stockholm, Sweden, becom-
ing a full professor in 1924.
Weibull obtained his doctorate from
the University of Uppsala in Uppsala,
Sweden, in 1932. Later, he worked in
Swedish and German industries as an
automotive
Groups, automakers Revise Guide
Two major automotive groups and automo-
tive suppliers—along with the Big Three
automakers and Toyota—have refined the
warranty management process included in
an industry manual that is expected to ulti-
mately help improve customer satisfaction
and the warranty process.
The second edition of the CQI-4 manual,
also known as Consumer-Centric Warranty
Management: A Guideline for Industry Best
Practices, was rolled out last month and
includes a self-assessment and toolkit. A
training program to educate users of the
CQI-14 warranty management process
is expected to begin in July, said leaders
of the Automotive Industry Action Group
(AIAG) and the Original Equipment Suppli-
ers Association.
The goal of CQI-4 is to reduce field
warranty claims, which in turn improves
consumer satisfaction “as measured by
short-term initial quality and long-term
16 QP • www.qualityprogress.com
inventor and as a consulting engineer.
In 1939, he published his paper on
Weibull distribution in probability theory
and statistics. It can be applied in sev-
eral areas, including survival analy-
sis, reliability engineering, industrial
engineering, extreme value theory and
weather forecasting.
In 1941, Bofors, a Swedish arms
factory, gave him a research professor-
ship in technical physics at the Royal
Institute of Technology in Stockholm.
There, he continued to publish papers
related to the strength of materials,
fatigue, rupture in solids, bearings and
the Weibull distribution.
BIBLIOGRAPHY
Abernethy, Robert B., “Biography of Dr. E. H. Waloddi
Weibull, 1887-1979,” Barringer & Associates, July 20,
2003, www.barringer1.com/weibull_bio.htm.
vehicle durability and reliability,” said J. Scot
Sharland, AIAG’s executive director.
In addition to Chrysler, Ford Motor Co.,
General Motors Corp. and Toyota, 17 sup-
plier member companies helped revise the
guideline and develop the training.
“A cultural change focusing on reducing
incident rate is needed,” said Dave Sakata,
vice president of technology at Freuden-
berg-NOK and a leader of the Consumer-
Centric Warranty Management workgroup.
“It is necessary to develop continuous
improvement processes that keep track of
warranty parts information and other data
for further investigation, and to conduct
root cause analysis so that solutions and
lessons learned can be determined and
implemented in current and future pro-
grams,” he said.
You can find out more about the
guideline and training program at www.
consumercentricwarranty.com.
USP meeting (continued from p.15)
Thomas Menighan, CEO of the Ameri-
can Pharmacists Association, stressed
the need for collaboration to lead the way
to healthcare reform. Menighan said the
“medication use crisis in this country,”
referring to drug interactions, “is literally
exploding” and presents a major opportu-
nity for doctors, nurses, pharmacists and
others to advance public health.
Jennie Chin Hansen, president of the
Association of American Retired Persons
and CEO of the American Geriatrics
Society, echoed Menighan and pointed
out that a growing population of older
Americans is using more medications per
person.
Of 3 billion yearly prescriptions, nearly
40% are not taken properly, leading to ad-
verse drug events and higher healthcare
costs, she said.
ASQ input and USP resolutions
Also at the meeting, USP members voted
to approve nine key resolutions that will
help determine USP strategy and benefit
public health during the next five years.
One of the resolutions could make
ASQ and its Food, Drug and Cosmetic
Division a key contributor to USP by
developing quality standards for food
ingredients and strengthening the role
of the Food Chemicals Codex as a
global compendium of internationally
recognized standards for the purity and
identity of food ingredients.
The ASQ division’s contribution to the
discussion resulted in a USP white paper
and resolution No. 6, “Continue and Ex-
pand Commitment to Quality Standards
for Food Ingredients.” Other opportunities
may exist for further ASQ collaboration
relating to another resolution to promote
quality standards for dietary supple-
ments.
For more information about the USP
resolutions, visit www.usp.org. To read
the USP white paper, visit ASQ’s Food,
Drug and Cosmetic Division website at
www.asq.org/fdc.
customer satisfaction
quality report: Airlines improve performance in 2009
As airlines fly fewer flights and passengers
book fewer trips in the air, the nation’s
leading carriers are improving performance
in many areas, including on-time perfor-
mance and reduced customer complaints.
In fact, this is the second consecutive
year that leading carriers have improved
their scores in the annual U.S. Airline
Quality Rating (AQR) study—a joint re-
search project funded as part of faculty
research activities at Purdue University
in Indiana and Wichita State University
in Kansas. Last year, airlines had the
third-best overall score in the 19 years
researchers have tracked airline perfor-
mance. In total, 18 airlines were examined
in the study’s 20th year.
The AQR was developed as an objective
method for assessing airline quality based
on several performance criteria. The 2009
AQR scores were based on 15 elements in
four major areas focused on airline perfor-
mance most important to air travelers.
In 2009, airlines improved in three
areas:
• On-time performance.
• Baggage handling.
• Customer complaints.
The only area in which performance
dropped was related to denied boardings,
or passengers being “bumped.”
Comparing numbers
The overall leading carrier rankings
changed little from 2008 to 2009, and the
top four airlines remained the same. The
top 10 carriers were:
1. Hawaiian.
2. AirTran.
3. JetBlue.
4. Northwest.
5. Southwest.
6. Continental.
7. Frontier.
8. U.S. Airways.
9. American.
10. ExpressJet.
The report also found:
• Hawaiian Airlines had the best on-time
performance (92.1%), while Atlantic
Southeast—ranked 17 out of the 18
airlines—had the worst (71.2%).
• Fourteen airlines improved their on-
time arrival performance, and only six
of the airlines had an on-time arrival
percentage more than 80%.
• JetBlue had the lowest involuntary de-
nied boardings rate at zero per 10,000
passengers. American Eagle, ranked
18th in the overall list, had the highest
rate at 3.76 per 10,000 passengers.
• Overall, nine airlines improved their
denied boarding rates last year.
• AirTran had the best baggage han-
dling rate with 1.67 mishandled bags
per 1,000 passengers, while Atlantic
Southeast had the worst with 7.87
mishandled bags per 1,000 passen-
gers.
• Customer complaints per 100,000 pas-
sengers dropped from 1.15 in 2008 to
0.97 in 2009.
While the majority of the report indi-
cated good news for airlines and their
passengers, the study’s authors said there
is still room for improvement.
“Seeing a continuing upturn in quality
is good news for all air travel consumers,
but it does not mean we have fixed the
system,” said Brent Bowen, professor
and head of the department of aviation
technology at Purdue. “Industry will never
be successful in terms of quality until it
can be successful financially. The financial
crisis in the industry is a significant factor
in the decline of quality.”
The biggest challenge for airlines will be
to improve performance quality as more
people choose to fly.
“Every time there are more planes in
the sky and more people flying, airline per-
formance suffers,” said Dean Headley, as-
sociate professor of marketing at Wichita
State University. “Airlines are focused on
generating revenues, not necessarily on
customer service.”
BIBLIOGRAPHY
Bowen, Brent D., and Dean E. Headley, “Airline Quality Rating
2010,” April 12, 2010, http://aqr.aero.
—Nicole Adrian, contributing editor
June 2010 • QP 17
 keepingcurrent
shortruns
THE AMERICAN NATIONAL Stan-
dards Institute (ANSI) has announced
this year’s World Standards Week will
be celebrated Sept. 21-24, and that
Sept. 23 will be World Standards Day.
Visit www.ansi.org/meetings_events/
wsw10/wsw.aspx?menuid=8 for a
preliminary schedule and other infor-
mation about activities related to the
standards celebrations.
CUSTOMER SATISFACTION SCORES
remained relatively unchanged in the
fourth quarter of 2009, according to
the most recent American Customer
Satisfaction Index (ACSI). Analysts saw
the scores as a good sign in a troubled
economy. For more information about
the quarterly scores and commen-
tary, visit www.theacsi.org/index.
php?option=com_content&task=view
&id=13&itemid=31.
THE FEDERAL COMMUNICATIONS
Commission (FCC) has approved the
ANSI-ASQ National Accreditation
Board/ACLASS to accredit laboratories
that test telecommunication equip-
ment subject to FCC rules. For more
information about this development,
visit www.aclasscorp.com/news/
archives/2010/03/fcc-recognition-for-
aclass.aspx.
THE BALDRIGE NATIONAL Quality
Program is one of the top 10 leader-
ship development programs among U.S.
government and military organizations,
according to Leadership Excellence
magazine. The publication chooses its
top leadership development programs
from more than 1,000 candidate orga-
nizations based on seven criteria: vision
18 QP • www.qualityprogress.com
and mission; involvement and participa-
tion; measurement and accountability;
curriculum; presenters, presentations
and delivery; take-home value; and
outreach. This is the third straight year
the Baldrige program has been included
in the magazine’s rankings. For more
information about the rankings, visit
www.leaderexcel.com/best_ranking.
html.
THE JURAN INSTITUTE has relaunched
its website in an effort to make it more
interactive and user-friendly. Visit www.
juran.com to look over the changes and
new features.
A NEW RADIO frequency identifica-
tion (RFID) standard has been released
by the International Organization for
Standardization (ISO). The standard, ISO
17367:2009, Supply chain applications
of RFID—Product tagging, defines the
basic features of RFID for use in the
supply chain when applied to product
tagging. For more information about
the standard, visit www.iso.org/iso/
pressrelease.htm?refid=Ref1293 (case
sensitive).
THE SIXTH EDITION of Juran’s Qual-
ity Handbook, the classic compen-
dium for many quality professionals
that was first published in the 1950s,
has been released. New topics have
been added by co-author and editor-
in-chief Joseph A. De Feo of the
Juran Institute, including sections on
benchmarking best practices, continu-
ous innovation, eco-quality, lean, root
cause analysis, Six Sigma, and agile
software and systems development.
The book, published by McGraw Hill,
retains material originally written by
Joseph M. Juran.
WebWatch
This month’s Web Watch focuses on supply
chain management. For more quality-relat-
ed websites, visit www.asq.org/links.
www.ism.ws
The website for the Institute for Supply
Management (ISM) offers services and infor-
mation focusing on education and research
related to purchasing and supply manage-
ment. ISM members can access an extensive
database of articles and resources, a career
center and ISM’s monthly magazine, Inside
Supply Management. Membership dues can
be waived for qualified applicants. Nonmem-
bers can access tools and guides, informa-
tion on certifications, and conference and
program schedules.
www.leanscm.net
This website is a place for supply chain
management professionals to interact with
subject matter experts (SME). It is divided
into several topics, including supply man-
agement, Six Sigma, team management,
career management, lean management,
software management and customer rela-
tionship management. Each topic is owned
by an SME, who provides information and
moderates discussion.
www.supply-chain.org
The Supply-Chain Council is a not-for-profit
membership organization that exists mainly
to disseminate its Supply Chain Opera-
tions Reference (SCOR) model. The website
provides nonmembers access to SCOR over-
view materials, IT vendors, consultants and
researchers who support SCOR, as well as
a calendar of events. It also links to related
organizations. Members have access to the
current version of SCOR, complete contact
information for all members, conference
presentations, white papers and research
study results.
ASQNews and Practical Guide to Using Lean Prin-
QUALITY IN DUBAI The Dubai ciples to Transform Healthcare Systems,
Quality Group (DQG) held an One Doctor at a Time, describes Aneesh
event for DQG members, ASQ and Carolyn Suneja’s journey through Chil-
members and other quality pro- dren’s Hospital of Wisconsin and illustrates
fessionals in February in Dubai, six steps they say will help implement an
United Arab Emirates. About 100 effective lean system in healthcare. The
people attended the gathering, book is available at www.asq.org/quality-
which was sponsored by Middle- SAMIA AL-YOUSEF, Dubai Quality Group managing director, press/display-item/index.html?item=H1387
sex University in Dubai. Robert (second from left) presents a memento of appreciation to (case sensitive). There, you can also find a
Robert Chalker, ASQ Global managing director, during the
Chalker, ASQ Global managing recent Dubai event. Others at the presentation were Sunil
link to a free webinar on the book and the
director, and Tommy Tam, ASQ Thawani, ASQ Country Counselor for the United Arab Emir- benefits of lean in healthcare.
ates (far left) and Tommy Tam, ASQ Global new business
Global new business develop-
development director (far right).
ment director, represented ASQ. LEAN CERTIFICATION ASQ is now offering
They discussed ASQ’s “Future of Quality” NEW BOOK ON LEAN AND HEALTHCARE lean certification through a new alliance
report and presented an overview of ASQ. Two efficiency experts recently wrote with the Society of Manufacturing Engineers,
an ASQ Quality Press Book about lean the Association for Manufacturing Excel-
QUALITY FORUM IN CHINA More than principles in hospital settings after they lence and the Shingo Prize for Operational
300 people attended a quality forum orga- took their daughter to an emergency room Excellence. To learn more about this certifi-
nized by ASQ China and the Shenzhen As- and saw first-hand how lean could improve cation and ASQ’s 16 other certifications, visit
sociation for Quality earlier this year. ASQ healthcare practices. Lean Doctors: A Bold www.asq.org/certification/index.html.
China members and other quality profes-
sionals discussed the evolution of quality
and what’s expected of quality profession- Standards development
als today. Presenters included Kevin Wu, tag 176 honors five members
ASQ China’s general manager; Lestie Carey,
an organizational change specialist; and Technical advisory group (TAG) 176 presented awards at ASQ’s spring standards
Peter Shi, an ASQ member. meetings in San Diego. Those honored included:
• Scott Bickley, TAG 176 secretary/treasurer—Unsung Hero Award.
HUNTER AWARD DEADLINE Applica- • Charles Cianfrani, TAG member—Outstanding Professional Achievement.
tions for the 2010 William G. Hunter • Denise Robitaille, TAG 176 vice chair—Outstanding Professional Achievement.
Award are now available through ASQ’s • Dan Harper, TAG mem-
Statistics Division. The award, named for ber—Honorary Lifetime
the division’s first chairman, recognizes Achievement.
leaders in applied statistics. Nominees do • Harrison Wadsworth,
not need to be members of the division TAG member—Honor-
but must demonstrate significant con- ary Lifetime Achieve-
tributions to the field and “inspirational ment.
leadership and application.” Nominations TAG 176 develops the
are due July 15. Visit www.asqstatdiv.org/ U.S. positions on inter-
awards.htm for award criteria, nomina- national standardization
THREE TAG 176 MEMBERS who were honored at a recent
tion forms and other details. You can also activities of ISO technical
meeting include Scott Bickley, (third from left), Denise Rob-
contact Robert H. Mitchell, one of the committee 176 on quality itaille (third from right) and Dan Harper (second from right).
Others in the photo are: (from left) Bill Tony, ASQ publisher,
award’s organizers, at 651-736-8684 or management and quality
Alka Jarvis, TAG 176 chair, and (far right) Paul Palmes, former
rhmitchell@mmm.com with questions. assurance. TAG 176 vice chair.

June 2010 • QP 19
 keepingcurrent
QP
online
onpaper
Quick Poll RESULTS
Each month at www.qualityprogress.com, visitors can take an
informal survey, and we post the results. Here are the numbers
from a recent Quick Poll:
“What aspect of the healthcare reform bill will have the
biggest impact on quality?
• Medicare reimbursing for quality of care 44.7%
• Quality-based reporting requirements 34.2%
• Comparative effectiveness research 10.5%
• Grants rewarding best practices 10.5%
Visit www.qualityprogress.com for this month’s poll question:
“How does your organization support innovation now vs.
when the economy was better?”
• Less supportive
• More supportive
• No change
POPULARITY CONTEST
QP regularly tallies the web traffic to www.qualityprogress.
com. The top five most accessed articles this month are:
1. James J. Rooney, Lee N. Vanden Heuvel, Donald K. Lorenzo
and Laura O. Jackson, “Cause and Effect,” February 2009,
www.asq.org/quality-progress/2009/02/basic-quality/
cause-and-effect.html.
2. Michael S. Perry, “A Fish (bone) Tale,” November 2006,
www.asq.org/quality-progress/2006/11/problem-solving/
a-fish(bone)-tale.html.
3. James J. Rooney and Lee N. Vanden Heuvel, “Root Cause
Analysis for Beginners,” July 2004, www.asq.org/pub/
qualityprogress/past/0704/qp0704rooney.html.
4. Simha Pilot, “What is a Fault-Tree Analysis?” March 2002,
www.asq.org/quality-progress/2002/03/problem-solving/
what-is-a-fault-tree-analysis.html.
5. QP’s Annual Salary Survey, “Holding Steady,” December
2009, www.asq.org/quality-progress/2009/12/salary-survey/
holding-steady.html.
20 QP • www.qualityprogress.com
asq
Australian quality group
awards honorary title
to past ASQ president
The Australian Organisation of Quality (AOQ) has awarded
former ASQ President H. James Harrington the title of “Global
Leader in Performance Improvement Initiatives,” the first time
the recognition has been given to someone outside Australia.
“He is an inexhaustible creative au-
thor of over 36 books that have added
value to countless businesses around
the world,” Shan Ruprai, the president
of AOQ, said in a prepared statement.
“Harrington writes the books that other
consultants use.”
In addition to this recognition, Har-
rington was appointed to an advisory
board to contribute to a task force formed by former House
Speaker Newt Gingrich earlier this year that will address jobs
and the economy.
The task force, organized by Gingrich’s political advocacy
group, “will discuss ways of turning American economic prob-
lems around,” according to a statement prepared by the group.
Harrington served as president of ASQ from 1985-1986.
wordtothewise
To educate newcomers and refresh practitioners and
professionals, QP features a quality term and defini-
tion each month.
Quality loss function
A parabolic approximation of the quality loss that
occurs when a quality characteristic deviates from
its target value. The quality loss function is expressed
in monetary units: the cost of deviating from the
target increases quadratically the farther the quality
characteristic moves from the target. The formula
used to compute the quality loss function depends
on the type of quality characteristic being used. The
quality loss function was first introduced in this form
by Genichi Taguchi.
SOURCE:
“Quality Glossary,” Quality Progress, June 2007, p. 54.
customer satisfaction
more customers
ready to switch
their banks
Bank customers continue to be less loyal
to their banks, in large part because of
perceived poor service and high fees,
according to a J.D. Power and Associates
study released last month.
For the fourth straight year, however,
retail banking customers’ overall satis-
faction averaged 748 on a 1,000 point
scale—slightly better than 749 last year.
The percentage of customers who said
they “definitely will not” switch banks dur-
ing the next year decreased significantly
during the past three years to 34%, com-
pared with 46% in 2007. Poor customer
service was cited by 37% of the custom-
ers who changed their primary bank this
year. High fees were cited by 29% of those
who switched banks.
For more details about the 2010 U.S.
Retail Banking Satisfaction Study, visit
http://businesscenter.jdpower.com/news/
pressrelease.aspx?id=2010068.
standards
new webinar
details iso
9001:2008
A new ASQ webinar describes the ins and
outs of the ISO 9001:2008 standard. ISO
9001 experts Charles Cianfrani and Jack
West—who co-authored ISO 9001:2008
Explained, third edition—along with Joseph
J. Tsiakals, provide an overview of the new
standard, address its key changes and
answer commonly asked questions.
The 90-minute webinar is available to
ASQ members.
For more information and to access the
webinar, visit www.asq.org/knowledge-
center/iso-9001/index.html.
Who’s Who in
NAME: Lori A. Terpstra.
RESIDENCE: Conn, Ontario.
Q
EDUCATION: Terpstra received a bachelor’s of science degree from the University of Guelph
in Guelph, Ontario, followed by an MBA from Wilfrid Laurier University in Waterloo, Ontario
and college diploma in quality from Conestoga College in Kitchener, Ontario. She is an ASQ
certified manager of quality/organizational excellence, quality engineer, reliability engineer,
quality auditor, quality technician, mechanical instructor and quality improvement associate.
She is also an International Register of Certified Auditors and Registrar Accreditation Board-
trained auditor and has received a Six Sigma Black Belt from Six Sigma Academy Florida.
CURRENT JOB: Service operations manager at Shred-Tech in Cambridge, Ontario. Shred-
Tech designs and manufactures reduction systems and shredding machinery.
INTRODUCTION TO QUALITY: Terpstra said she fell into the quality
field almost by accident. While going to the University of Guelph, she
worked part time in a research lab and became part of a test method
development team working on DNA fingerprinting. Her involvement
in quality kept growing and evolving from there.
ASQ ACTIVITIES: A member since 1995, Terpstra is the 2009-2010
chair-elect for ASQ Section 405 and has been a preliminary round
judge for the International Team Excellence Awards for the last two years. She has
spoken twice at the World Conference on Quality and Improvement and presented at
her local and Chicago sections. Terpstra recently served as vice chair for the ASQ section
in Raleigh, NC, and has volunteered at ASQ headquarters, developing exams for several
certifications.
PUBLISHED: She has had two papers published that were associated with ASQ world
conferences in 2001 and 2002, as well as an After 5 Session presentation for the 2009
world conference.
RECENT HONORS: Terpstra was named an ASQ fellow earlier this year. Three times while
she worked at Moen, she was a member of teams that received Team Excellence Awards.
She also received a Corporate Ring of Quality Award while working at ITT Corp.
PERSONAL: Married for five years. Four-year-old son and expecting her second child in
October.
FAVORITE WAYS TO RELAX: Reading with her son, helping on her farm (Terpstra’s
husband is a full-time farmer) or working with her horses, especially those she rescues,
rehabilitates and finds new homes for.
QUALITY QUOTE: A lot of people understand the concept of quality. Many understand
the methods and techniques required to implement quality processes, procedures and
products. Only a few can turn those methods and techniques into actions and com-
mit themselves to the dedicated time and effort needed to overcome the hurdles and
resistance to make quality happen as an infrastructure component (way of life) at their
companies and services. To reach excellence, you have to be one of those few.
June 2010 • QP 21
 Bull’s-
eye
An inside look at how Target
ensures quality in a complex
supply chain
by William H. Murphy
 supply chain management

All companies want to build a stronger brand by ensur-

ing customer satisfaction. Along the way, of course, the companies want to
make a profit.
A company’s ability to achieve these goals hinges on the effective flow of
goods and services into and through its organization, coordinated by supply
management teams responsible for developing a world-class supply base,
purchasing competitively priced goods and services, reducing costs, improv-
ing cycle times and accelerating time to market.1
These challenges are set against a backdrop of an extraordinarily com-
plex array of factors and forces quality departments must address. Indeed,
the issues and challenges many quality managers face today have evolved
to include the mission of strengthening their companies’ capabilities across
entire supply chains.2
The story of one major retail chain illustrates many of these challenges
while adding to the body of research that supports quality’s
essential role in value creation through the use of quality In 50 Words
tools, processes and procedures. Or Less
• To ensure product quality
and on-time delivery to
stores, retail chain Target
has developed a compre-
hensive system to man-
age its supplier relation-
ships.
• The system includes strict
requirements for suppli-
ers and overseas factories
it uses to manufacture
store-brand products.
• This system and its global
quality program promote
and protect Target’s
brand.

June 2010 • QP 23
 Retailers are faced with an abundance of quality is-
sues as they pursue their mandate of providing quality
goods and services to consumers, and they must en-
sure quality is inherent in the thousands of products
lining store shelves. Without quality, there will be long
lines at return counters, customer dissatisfaction, the
possibility of legal action and customer exodus to com-
petitors.
Another factor adding to the challenges for retailers
is the advent of the store brand. Retailers can no lon-
ger rely on national brands to ensure product quality
or delivery through the supply chain, so they look to
manufacture their own products or rebrand private-
label goods. Ultimately, inferior product quality and
systemic failures in the supply chain assure the demise
of any retailer.
Target’s focus on quality
Target Corp. is one retailer that has placed great focus
on quality and formed quality groups to play critical
roles in supply chain activities and other areas of the
company. Launched in 1962 by the Dayton Co. as its
entry into mass-market discount merchandising, Tar-
get operates nearly 1,750 stores in 49 states with an-
nual sales of more than $65 billion in 2008. Last year,
Target placed 19th on Fortune’s list of “America’s Most
Admired Companies.”3
Without question, Target’s ongoing efforts to “strive
to exceed our guests’ expectations” require an aston-
ishing amount of behind-the-scenes effort from its
quality teams.
Kelly Joyce is the group manager of quality assur-
ance for Target Compliance and Production Services
(TCPS). Joyce reports to the TCPS director, who also
4
directs Target’s global compliance team on social
compliance.
Joyce has a team of quality assurance (QA) managers
and QA engineers that executes quality for all of Tar-
get’s hard (nonfabric-based) goods. This includes gen-
eral consumer goods, toys, furniture, decorative items,
school and office supplies, electronics, holiday and par-
ty goods, appliances, lighting, sporting goods, kitchen
and dining goods, pet products over-the-counter com-
modities, cosmetics, and health and beauty items.
Coming to Target with an operational and indus-
trial engineering background, Joyce has now been
with the company for six years. She had spent 20-
plus years in factory settings in industries such as
24 QP • www.qualityprogress.com
electronics, automotive, consumer goods and medi-
cal devices. Her background includes product R&D,
process design, factory design and just-in-time manu-
facturing.
In this interview, Joyce discussed her group’s efforts
to ensure quality throughout the expansive and contin-
uously changing network of supply chain participants.
She also talked about the global quality program Target
uses to ensure best-in-industry performance. Overall,
seven recurring themes emerged from our discussions:
1. All employees live the brand promise.
2. Quality is embedded in the entire sourcing strategy.
3. Variability is driven out of the system. When prob-
lems are identified, aggressive corrective action
steps are taken.
4. Consequence management rules, and procedures
are built in and transparent.
5. People are the essential force behind the success of
quality.
6. Quality never takes a backseat, and it always takes
precedence over other priorities, no matter how
pressing they may seem.
7. Quality never rests on its laurels.
The following are excerpts from our series of con-
versations and correspondence as they relate to these
seven themes.
1
All employees live the
brand promise.
Joyce talked about the brand promise Target makes,
bringing it up early in our discussions, again when
discussing her team and yet again when talking about
Target’s global platform for quality. Target does have
the advantage of a concise, catchy, customer-focused
statement—“Expect More. Pay Less”—that is con-
stantly supported throughout the organization.
But just how central is quality in Target’s strategy?
Many companies talk quality. Meanwhile, others live
quality. This can be reflected in people, processes and
financials. Where does quality live at Target?
Joyce: Target lives quality through our brand prom-
ise, “Expect More. Pay Less.” I have always been im-
pressed knowing our brand promise isn’t just a buzz
word for advertising. It is very well accepted and un-
derstood by everyone at Target. In fact, our internal
surveys repeatedly result in high scores in the areas of
understanding Target’s mission and team member con-

Business is all about communication,
relationships and finding the right
product in the right place.
nection to the mission. It may sound trite, but at Target
we actually live our brand promise.
2 Quality is embedded in the
entire sourcing strategy.
In hard-good lines, Target works with more than 3,000
factories. This large network of suppliers and factories
requires constant hands-on efforts by Target Sourcing
Services (TSS) teams and its TCPS team.
Complexity abounds in this sourcing scenario: New
products are constantly being considered, seasonal
items add pressure for the team, and at any given time,
a factory is responsible for multiple SKUs. As Joyce
said, “Walk into a Target store, and look at the breadth
and depth of products carried. You can imagine what
we are dealing with.”
Joyce stressed Target’s committed drive for total
quality. She discussed the top-down commitment to
quality at Target, with reporting lines direct to top
management. Quality works hand-in-hand with several
other Target teams. Quality is ensured before products
ever reach the shelves.
Joyce: As part of TSS, TCPS strives to enforce our
compliance, safety and quality standards around the
world. The goal of TCPS is to achieve exceptional in-
store product quality for our own branded products.
To do this, we validate that our supplier partners op-
erate efficient, safe and ethical factory environments.
Teams at headquarters focus on setting policy, creating
procedures, administration and enforcement, while
overseas teams validate our QA processes at supplier
factories. Teams include QA, global compliance and
product safety recall.
Every department works toward delivery of best
quality and best value. Quality is especially embedded
in our sourcing goals: team, speed, quality and global
expertise. Quality’s critical execution lies in product
implementation by our sourcing, product design and
development (PDD) and QA teams. Formal quality
supply chain management
departments exist in the following teams: TCPS, food,
packaging and corporate assurance. So, while my
group works mostly on product execution, quality pro-
grams span all efforts at Target.
For instance, here at headquarters, cross-functional
teams work directly with product designers, mer-
chants and sourcing managers, developing processes
to ensure more efficient, effective systems from con-
cept to shelf.
Although a major focus of TCPS is proactive (prior
to shipment with suppliers), other times, problems are
identified at the store level. For instance, there is a re-
porting system that provides metrics on the number of
returns of certain products—whether there have been
common complaints about a particular product, pat-
terns related to any claims or personal injury, or con-
cerns related to safety overall.
While multiple groups at Target see and use these
reports, our team aggressively sifts through this in-
formation. After we have clarity when it comes to the
drivers of the issues, information is fed back to the sup-
plier and factory, or to other departments as needed.
Let me give you one instance we dealt with recently.
We had a growing number of returns of a particular
gazebo. Our investigation of the reports identified a
pattern for the returns that did not relate to product
quality. Instead, many shoppers had returned the gaze-
bo, saying it had been impossible to set up. Ultimately,
what we discovered from our guest reports was that
our instructions to build the gazebo had been the un-
derlying cause.
We worked with a usability lab to develop a much
more comprehensive set of instructions. Only then
did we engage suppliers with the solution. As this sug-
gests, our PDD team and our QA teams often work to-
gether to develop an essential component that ensures
product quality. At the end of the day, you might say we
are involved in executing the whole product—that is,
whatever our guests pick up from the shelves has been
touched by our teams.
June 2010 • QP 25
 3 Variability is driven out of
the system.
The large number of SKUs Target carries—includ-
ing store and private-label brands, as well as national
brands—creates a huge complexity for quality assur-
ance. With hard-good lines coming from more than
3,000 factories around the world, along with ongoing
adjustments made to Target’s product mix (whether
being driven by design teams or competitive pres-
sures), there are many ways variability can enter the
system, with inferior or even harmful products finding
their way to store shelves.
Target’s systems thinking extends globally, reaching
every factory with rigorous requirements, all support-
ed by quality tools as standard operating procedure
(SOP).
Joyce: Our first non-negotiable requirement is that
every factory must meet our global social compliance
requirements. As per our contracts, Target is autho-
rized to conduct an unannounced social compliance
audit at any time. If a factory expects to continue
working with Target, it must pass these audits. We have
consequence management procedures stated clearly
to our suppliers, which make failing these audits an
avoid-at-all-costs proposition to our suppliers and their
selected factories. Ultimately, that’s the first purpose of
our business partner management program.
Of course, QA is essential to our program. When a
factory comes online, we evaluate the factory. These
evaluations are thorough, including an assessment of
the quality of products being produced, documenta-
tion, capabilities and capacities verification.
Our teams ask specific questions while using a rat-
ing system. The rating system reveals whether a sup-
plier will be allowed to use a particular factory, along
with identifying corrective actions needed. We have
factory ratings spanning from “pass-excellent,” “good
to go,” “pass—use this factory with caution,” to “fail-
ing—this factory cannot be used.”
The outcome of a single failed factory evaluation
doesn’t end a supplier relationship. The supplier must
seek another fully functioning quality factory for Tar-
get. Following any failed factory evaluation, it is up to
the supplier to decide whether it continues to work
with that factory with other retailers. It [the failed
evaluation] just means the factory is unacceptable for
Target. Over time, if a supplier repeats poor factory de-
cisions, it will impact Target’s willingness to accept the
26 QP • www.qualityprogress.com
risk of a continuing relationship with the supplier.
The main processes we execute are factory evalu-
ations, product testing and product inspection. We
also have preproduction planning. Our product inspec-
tions are definitely based on statistical average quality
limit (AQL) tools. Again, we validate quality and have
some pretty strong AQL standards and escalation pro-
cesses we use during inspections. We use corrective
action tools if we have product failure, and we quickly
determine the origin of the problem and then how it
occurred. We identify the steps needed to prevent the
failure in the future.
Supporting our factory evaluations are online cor-
rective action tools. Basically, when a factory evalua-
tion is completed, our manufacturing technician han-
dling the evaluation enters the data into these online
tools, providing an evaluation summary. While the
report automatically generates a corrective action re-
port, our Target technician is responsible for making
specific recommendations in that report.
The supplier’s factory in question is given deadlines
to fix the issues identified in the report. Soon after that
deadline, we return to the factory and perform another
evaluation based on the previously identified failure
points. If the factory has not been able to fix the cor-
rective actions required, the factory can’t be used.
Overall, we have been working to standardize many
quality principles in our everyday processes. Stan-
dards for product, supplier, environmental and social
compliance are benchmarked into our policies and
procedures. We extensively use quality statistical tools
(for example, statistical process control and AQL) in
our product quality validation processes.
Target has embraced Six Sigma throughout our
business processes and has created 6Sigma@Target, in
which the tools of Six Sigma are used in formal project
management, problem solving and process improve-
ment. There is a formal Six Sigma department that facil-
itates the use of Six Sigma throughout the organization.
4
Consequence management
rules, and procedures are
built in and transparent.
Target works to put every supplier and factory on a lev-
el playing field with no surprises for anyone. Target is
also transparent regarding the consequences of failing
to meet requirements. Although Target fully supports

suppliers and factories and offers guidance for them
to perform corrective actions, there are certain non-
negotiables at the core of every relationship.
Joyce: Our suppliers are fully aware of our require-
ments, and we are extremely transparent in these re-
quirements. At the start of all negotiations, suppliers
must sign a “standards of supplier engagement” agree-
ment that clearly spells out our requirements. Our
global social compliance requirements are the founda-
tion, and we have no tolerance for failures here.
For most areas, however, SOP is our factory rating
system. Factories can receive a green, yellow or red
score. If a new factory scores in the red zone, the fac-
tory is rejected. For factories in existing relationships
with suppliers, a red zone score leads to developing an
exit plan.
In terms of particular actions, we use a three strikes
platform. Severing the relationship occurs only if there
are repeated failures despite promises from the fac-
tory to improve. Collectively, this is what we refer to
as consequence management. Again, Target has a level
playing field for all, with the highest of standards being
detailed in our negotiations and ensuing contracts.
At the same time, we know how difficult it is to
manufacture a product, and we will work with suppli-
ers to be successful. We will definitely make recom-
mendations on how suppliers can improve. Over time,
if we see there is no supplier improvement—because
of a lack of capabilities or a lack of willingness—we
just stop the process with those particular suppliers.
5
People are the essential
force behind the success
of quality.
The genesis of Target’s quality program is located at its
headquarters in Minneapolis, where leadership from
TSS, TCPS and their counterparts work. There, about
50 team members (employees) are focused on quality,
but other quality-focused team members are stationed
around the world. Having Target employees placed
globally means everyone pursues quality with the same
commitment.
Finding members for the TSS and TCPS teams is a
critical component of Target’s strategy. As Joyce noted,
TSS employs more than 2,000 team members world-
wide, 450 of whom execute QA, working directly with
suppliers at their factories. Target leaders feel strongly
supply chain management
that commitment to a global quality program is the
best way to ensure quality.
Joyce: Nearly all TSS and TCPS QA personnel are
Target team members. Target only uses third-party en-
tities in factory quality processes if we do not have a
global presence in that country and it isn’t feasible to
send one of our team members. Overall, this is a very
low percentage.
Our team members are located in sourcing offices
all over the world. Most of our people are local to their
regions, although there are a small number of expatri-
ates in the system. We’ve found it is much more effec-
tive having local people performing the quality-related
activities. Business is all about communication, re-
lationships and finding the right product in the right
place. Having local people do this is much, much more
effective.
Regardless of country, most of our team members
are either engineers or quality people, and we seek
candidates who have performed quality tasks in at
least one factory. Our QA managers are definitely en-
gineers who are highly educated—some with master’s
degrees in engineering, and some who have been edu-
cated in the United States.
Along with strong educational backgrounds, our goal
is to hire candidates who have factory experience in a
quality role. Target is fairly unique in the retail industry
in that we have this global network with our own people
performing QA tasks overseas instead of outsourcing it
and managing quality from the United States.
We have an extensive training program for our over-
seas teams that includes in-person and online train-
ing. We also employ trainers worldwide in all of our
major overseas offices, giving us locally-based trainers
whose sole job is staff training.
All team members have access to our procedures
and best-methods database, as well as a learning
management system. Wherever we roll out a new
process (for example, factory evaluations), there
is a sequence of training operations. In addition to
formal on-the-job training, we also train employees
about Target stores, understanding Target guests and
branding so our overseas staff can better understand
Target without the benefit of ever having shopped at
one of our stores. Finally, all training, procedures and
implementation is validated through a formal office
assessment program that includes self-assessments
and formal audits.
June 2010 • QP 27
 The bottom line is that everyone in our organiza-
tion receives extensive training and support. Our
global team has the same access to all best-method
processes being developed. We have a huge database
of best methods and procedures that everyone ac-
cesses globally.
This arrangement keeps our entire global team
aligned with best practices. Any time we develop new
supplier or factory processes, we immediately develop
training programs. These programs typically include
online presentations for trainers to use with teams
around the world. We also have headquarters involve-
ment: Either I or other headquarters team members
regularly travel to our global offices to train others.
Our online database has a learning management
system that is also accessible to our overseas team
members. We have a corporate assurance team respon-
sible for auditing the overseas offices and assisting the
local offices in making adjustments based on identified
opportunities for improvement. Finally, our training
efforts go beyond Target personnel by engaging sup-
pliers in training activities. The purpose is to ensure
that all parties develop a shared awareness of our drive
for total quality and their critical role in making this
happen.
6
Quality never takes a
backseat.
Throughout the conversation, Joyce repeatedly dis-
cussed total quality as a mandate, despite the many
pressures placed on retailers. For instance, pressures
can easily escalate as holidays approach, marketing
campaigns converge and the urgency to have certain
product on the store shelves heightens.
These pressures are real and can have a large im-
pact on the success or failure of businesses if product
misses shelf targets—even by a day or two. In these
situations, great pressure is often placed on quality
teams to let things slide. But best-in-industry perform-
ers never lose sight of their priorities, no matter how
tempting the short-term opportunity may seem.
Joyce: Our QA team is constantly under perfor-
mance pressures. It isn’t just holidays. We are always
under pressure. That’s why you hire a team of engi-
neering and manufacturing professionals. Every day,
we’re making risk-based decisions. There is truly no
pressure when it comes to safety and regulatory fail-
28 QP • www.qualityprogress.com
ures. That’s an easy matter, and Target is extremely
supportive of those decisions. If we have those types
of failures, product will not leave the factory, regard-
less of what was supposed to be on the shelf.
When we’re outside of that failure type, we need to
make go/no-go decisions in terms of releasing product
to stores. For instance, a factory recently produced an
order of spring seasonal wrapping paper. But the blue
was a different tint than required. We decided the blue
would still be acceptable for our guests.
At the same time, we told the supplier that only
the initial shipment would be accepted, and the fac-
tory would need to remake all product in the queue.
Although color or tint may seem trivial, we work with
design themes across product categories, and consis-
tency is essential.
I’ve found that if any of our colleagues from other
groups have ever lived through a product recall or a
product withdrawal, it really helps because they be-
come advocates for our work and decisions. Overall,
the good news is that we work daily with our mer-
chants and product design groups. They clearly un-
derstand what our requirements are, so there isn’t this
undue pressure by any Target personnel pushing us to
pass products through the system that do not warrant
acceptance.
7 Quality never rests on its
laurels.
Typically, efforts to create and maintain a rock-solid
quality program are accompanied by high work inten-
sity caused by unforeseen challenges or roadblocks.
These challenges range from a changing sea of suppli-
ers, factories and product lineups to pending laws and
rulings to internal pressures from outside-of-quality
teams.
Despite this reality, as quality programs mature, it
seems possible that quality leaders might be able to
envision a time when everything that quality touches
is good-to-go, and there will be a time to sit back, put
up their feet and take things a bit easy. I threw this idea
out to Joyce.
Joyce: Never. There is always, always work to be
done. Although we are very satisfied with the progress
we’ve made during the past several years, we are always
moving forward. There is so much more improvement
that we can make, and that’s what makes it exciting.

Retailers must do more than merely
cope. They need to assert control so they
maintain their brand promise.
When people ask me during interviews exactly what
it is that I like most about working for Target, my per-
sonal answer always addresses the connection to the
brand mission we live at Target.
Also, it is never boring. I find it exciting to come to
work anticipating exciting challenges ahead and know-
ing my director and the resources at Target support
our efforts at TCPS. I admit there are days when I wish
it was boring. But it’s never boring. There is always
something new we are trying to improve—something
we are trying to push forward.
Even now, we’re working on strategies that will
make a difference and affect change years and years
from now. I think any true quality professional would
never suggest you can just rest on your laurels. Believe
me, continuous improvement processes are alive and
well at Target.
Completing the circle
Joyce made it clear that Target systematically evalu-
ates all stages of supplier relations, beginning with
supplier selection. Further, Target team members
work with multiattribute templates that include expan-
sive criteria for supplier and factory evaluations and
provide global team members consistent and system-
atic evaluation processes.
Target also has SOP related to steps required by
suppliers, accompanied by the full support of Target
team members, if substandard evaluations result. Ad-
vocating processes and steps to engage suppliers and
factories is not new.5, 6 But you don’t necessarily hear
about retailers developing and advancing these quality-
driven strategies.
At Target, systematic selection processes are transi-
tioned into the ongoing application of total quality man-
agement principles and processes, completing the circle
for Target and ensuring best-in-class performance.
Target faces an ongoing challenge when it comes to
supply base rationalization. Although some may argue
a small supply base is needed to build relationships,
supply chain management
major retailers such as Target must work with many
suppliers and thousands of factories across hard-goods
and soft-goods lines. That challenge is compounded
by the new super-store formats that incorporate food
lines, pharmaceuticals and other innovative products.
Despite these complexities, retailers must do more
than merely cope. They need to assert control so they
maintain their brand promise. Target is exemplary in
that it has a proactive engagement strategy spanning
the world, ensuring its total quality mandate across all
supply chain relationships.
Given its success, an aggressive commitment to its
mission and a powerful quality program, Target’s fu-
ture seems to be on good footing. The retailer’s place
on Fortune’s list of “America’s Most Admired Compa-
nies” may become a familiar sight in the coming years.
For competitors, reviewing the seven themes Joyce
addressed may reveal gaps in their own quality ef-
forts—gaps that must be closed if they wish to keep
pace. QP
REFERENCES AND NOTES
1. Paul D. Cousins and Robert Spekman, “Strategic Supply and the Manage-
ment of Inter- and Intra-Organizational Relationships,” Journal of Purchas-
ing and Supply Management, Vol. 12, No. 6, 2003.
2. David K. Watkins, “Quality Role in Management’s Global Sourcing,” Quality
Progress, April 2005, pp. 24-31.
3. Details on the company history and financials were found at www.target.
com.
4. Conversations between Kelly Joyce and the author began in October 2008,
and the author visited Target headquarters in November 2008. Follow-up
phone calls and e-mail exchanges with Joyce took place through March
2009.
5. S.B. Bargla, “A Case Study of Supplier Selection for Lean Supply by Using
a Mathematical Model,” Logistics Information Management, Vol. 16, No. 6,
2003, pp. 451–459.
6. L. De Boer, E. Labro and P. Morlacchi, “A Review of Methods Supporting
Supplier Selection,” European Journal of Purchasing and Supply Manage-
ment, Vol. 7, 2001, pp. 75–89.
WILLIAM H. MURPHY is an associate professor in the
department of management and marketing at the
University of Saskatchewan in Saskatoon. He holds a
doctorate in marketing and business administration
from the University of Wisconsin-Madison.
June 2010 • QP 29
OK, so you’ve
identified an area with
improvement potential,
picked a team to examine the
problem, invited stakeholders
to brainstorming sessions that
help analyze potential solutions,
ran a quality and cost analysis of
those solutions, gained approval
from top management to establish
a pilot project, selected metrics to
judge the success of the pilot project,
rolled out the solution on a wider
basis and determined it should be
implemented at every site across
your entire organization ...
 ?
innovation

Now
...
What by Clark Carboneau,
Jon Banks,Tony Armijo
and John A. Zondlo
Developing solutions
for complex, chronic, systemic problems
requires management’s commitment of resources
coupled with an improvement process such as lean
Six Sigma. For many organizations, regardless of industry,
maximizing the resource expenditure requires spreading the
solutions to all pertinent departments and facilities within the
organization. This is the story of one organization’s efforts to develop
and implement a dissemination process that would consistently spread
its improvement solutions across all facets of the organization. While this
takes place in a healthcare setting, the solution can be customized for any industry.

June 2010 • QP 31
 The struggle to implement evidence-based best
practices in healthcare is ongoing and well document-
ed.1 Presbyterian Healthcare Services (PHS) knows
these difficulties all too well. A nonprofit integrated
healthcare system in New Mexico, PHS has eight hos-
pitals throughout the state, including a 450-bed acute-
care facility at its main site in Albuquerque.
The challenge for management and staff was to
spread the solutions from an improvement team at the
pilot site to other areas. Initial difficulties limited the
potential gains in patient safety and cost reductions.2
So, in response, PHS developed a collaborative pro-
cess to deploy its solutions (see Figure 1).
Spreading solutions
The ingredients for a successful dissemination project
include:
• Senior leadership support.
• Key stakeholder meetings.
• Biweekly meetings during implementation.
• Project manager’s on-site support.
• Use of a service level agreement (SLA).
• Post-spread control plan.
Of course, a dissemination project is useless with-
out a solution to disseminate. So PHS targeted four ar-
eas of potential improvement at its main hospital and
assigned a team to each one:
1. Pressure-ulcer prevention: The goal of the pres-
sure-ulcer prevention project was to reduce hospi-
tal-acquired pressure ulcers enterprisewide from
18% to 5% or less. The secondary goal was to pro-
vide the tools and the foundation for a sustainable
culture of standardized best practices for pressure
ulcer prevention across all Presbyterian Regional
Hospitals (see Figure 2).
2. Hand-hygiene compliance: Effective hand-hy-
giene compliance has long been known to prevent
hospital-acquired infections. The goal of the hand-
hygiene project was to raise compliance at all PHS
regional hospitals to a level that meets or exceeds

Spreading innovations flowchart / Figure 1

1 3 4 5 6 8
Black Belt Yes BB Senior Senior Senior Yes Spread
(BB) leaders leaders leaders team
Start of Verify A
process Verify that Solutions current Articulate Identify Verify on-site Are needed Spread
are resources
solutions project value of Champion administrator project
significant? available?
from original performance spread to and process (Champion) charter
project are measures at receiving owner at supports elements
statistically spread site site each spread spread defined
significant location
No No

Senior Senior
2 leaders
7 leaders
Delay Spread on
start until hold until
significance steps 4–7
is proven in place

9 10 11 12 13 14 15 16
BB Spread team Spread team Spread team Spread Spread Spread Spread
and BB and BB and BB team team team team
A Set up and End of
hold key On-site visit On-site visit Hold biweekly Fully On-site audit Control Spread process
stakeholders overview working teleconferences implement to verify plan in project
meeting meeting meeting to discuss SLA solutions are place closed
SLA items in place and
and issues effective
SLA = service level agreement

32 QP • www.qualityprogress.com
 innovation

the Joint Commission’s national pa-

tient safety goal of 90%.3 The second-
Pressure-ulcer incidence rate
ary goal was to develop a sustainable
(original project) / Figure 2
culture of hand-hygiene compliance 30%
that was peer enforced (see Figure 3).
3. Emergency department (ED) co- 25%
pay: The goal of the ED co-pay project
was to increase the number of co-pays 20%

Percentage
collected in the ED at the time of ser-
vice from 5% to 15%. The metric for 15%
this project was the percentage of co-
pays collected from patients who had
10%
co-pays due—defined as “potential co-
pays” (see Figure 4, p. 34).
5%
4. Health information management:
The ability to make complete electron- Pressure ulcer prevention target = 5%
0%
ic medical documentation available in Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
a timely manner assures patient safety 2007 2007 2008 2008 2008 2008 2009 2009 2009 2009 2010
and service. The health information Time period

management process had a long cycle

time that resulted in delays of availabili- Hand-hygiene compliance rate
ty of electronic medical documentation (original project) / Figure 3
for follow-up and future patient care.
Compliance rate
The existing process batched an abun- after improvements
dance of documentation, which resulted 100%
Compliance rate before improvements
in inefficiencies and multiple handlings, 90%
contributing to the overall cycle time. The
80%
project goal was to reduce cycle time from
70%
66 hours per chart to fewer than 30 hours
Percentage

(see Figure 5, p. 35). 60%

50%
Flowchart overview 40%
Commitment by senior leadership is criti-
30%
cal to the success of a dissemination proj-
ect.4 PHS senior leaders have made a com- 20%
mitment to standardize processes across 10%
all of the system’s facilities. 0%
If one hospital completes a Black Belt
3/2007
4/2007
5/2007
6/2007
7/2007
8/2007
9/2007
10/2007
11/2007
12/2007
1/2008
2/2008
3/2008
4/2008
5/2008
6/2008
7/2008
8/2008
9/2008
10/2008
11/2008
12/2008
1/2009
2/2009

(BB) or Green Belt project with proven

solutions, the other hospitals within the
system are expected to implement them.
The initial hospital has the responsibility
for leading the dissemination process. Spreading inno-
vations must not be left to chance; rather, a detailed
dissemination process is required.5
The spreading innovations flowchart is based on
three principles:
1. Collaboration. Each hospital has its own site dis-
Month/year
semination team, but all site team members meet
every two weeks via teleconference to discuss prog-
ress, barriers, what is working and what isn’t. Build-
ing collaboration among the various sites aids the
effort by providing an opportunity for each team to
offer its perspective on spreading the innovations.6

June 2010 • QP 33
 2. Pull vs. push. The main hospital in Albuquerque
could not dictate—or push—the spread of solu-
tions to the other hospitals. For the solutions to
be accepted by the regional hospitals, they needed
to understand them and then choose to implement
them.
3. One-on-one support. The BB travels to each site
for a day-long visit to meet the site team and provide
leadership for the dissemination project. Included
in the visit is a detailed explanation of each solu-
tion, assistance with adoption (if needed) and de-
velopment of an SLA for implementation. For an ex-
ample, see “Hand-hygiene service level agreement”
online at www.qualityprogress.com.
Flowchart walkthrough
Step 1: Verify solutions. In the context of the Six
Sigma method of define, measure, analyze, improve
and control (DMAIC), project dissemination should be
considered as early as the design phase. But it is im-
portant to confirm the implemented solutions from the
original project demonstrate a statistically significant
improvement before dissemination is initiated.
Step 2: Confirm proof of the solution. If solu-
tions from the original project are not considered
significant, senior leaders must delay the start of the
Emergency department co-pay
dissemination project until the impact of solutions can
be verified. It is a considerable waste of time and re-
sources to disseminate a process that has questionable
outcomes. This step should be considered a hard stop
in the process until solutions are verified.
Step 3: Verify current process performance
measures. The receiving site may already have per-
formance measures concerning the original project.
Confirming those measures exist is crucial because the
current baseline performance is invaluable in integrat-
ing the improvement project at the receiving sites. If
they do not exist, this is a good starting point for ad-
dressing outcome and in-process measures that will
need to be collected in association with the dissemina-
tion project.
Step 4: Articulate the value of dissemination.
This action creates the foundation for acceptance
and the necessary cultural change associated with
the new process. This is the time to articulate the val-
ue to all involved at the site—from senior leaders to
front-line staff. If this step is not emphasized and in-
tegrated into the dissemination process, the chances
of the site accepting and sustaining the changes are
compromised.
Step 5: Identify champion and process owner.
On-site champions and process owners are essential to
dissemination, which could otherwise be
viewed as an outside process imposed on
the receiving site. The champion and pro-

collection rate (original project) / Figure 4 cess owner communicate and reinforce
the value of dissemination to the receiving
30% site and are crucial to successful imple-
mentation of the new process.
25% Step 6: Verify on-site champion
support. The champion’s role is to re-
20% move obstacles, support the implementa-
Percentage

tion and ensure sustainment of the new

15% process. If this role is not completely
defined and agreed upon, the implemen-
10% tation and sustainment of the process is
in jeopardy.
5% Step 7: Verify on-site resources.
A few of the basic resources needed on
0% all dissemination projects are available
3/1/08
3/15/08
3/29/08
4/12/08
4/26/08
5/10/08
5/24/08
6/7/08
6/21/08
7/5/08
7/19/08
8/2/08

8/30/08
9/13/08
9/27/08
10/11/08
10/25/08
11/8/08
11/22/08
12/6/08
12/20/08
1/3/09
1/17/09
1/31/09
2/14/09
2/28/09

to staff to work on the project, time for

8/16/08

staff to work on the project and money

to purchase materials. If these essential
Date
resources are not available, senior leaders

34 QP • www.qualityprogress.com
 innovation

It is a considerable waste of time and

resources to disseminate a process
that has questionable outcomes.
must delay the start of the project. It is a considerable
waste of time to try and spread a process without es-
sential resources. If that’s the case, this step should be
considered a hard stop in the process until resources
are provided.
Step 8: Define dissemination project charter
elements. The charter helps define the parameters
that govern the dissemination process. The elements
include the goal, scope and timeline of the project.
Without clearly defining these elements, the process is
at risk of expanding outside the original project bound-
aries, diluting the solution’s impact.
Step 9: Key stakeholder meeting. The purpose
of this meeting is to bring all site-team members to-
gether as a collaborative team. Participants may not
know each other prior to the meeting, so during the
first meeting, each participant is given a contact list of
those who will be working on implementing the same
solutions.
The collaborative approach is efficient
and cost effective. Bringing all people
involved with the dissemination project
together as a team costs less than holding
Health information management chart
multiple separate meetings. cycle time (original project) / Figure 5
Because travel time and costs were
considerations for the PHS dissemina-
tion project, the meeting was held via
teleconference. In addition, a SharePoint
site was used, with site members dis-
cussing:
Hours
• The schedule for biweekly teleconferences for the
duration of the dissemination project.
• Plans for on-site BB visits.
Step 10: On-site visit. An e-mail or directive to
each site declaring the need for dissemination will not
suffice in spreading solutions. Understanding the per-
son doing the work and his or her unique environment
will build credibility and the needed good will for proj-
ect success.
In The Tipping Point, Malcolm Gladwell credits the
successful agricultural salesmen as the ones who pull
on their boots and go out into the field with the farmer.7
All workers are busy doing their jobs. A dissemination
project is just one more item added to an already jam-
packed schedule. For the project to be successful, the
project manager must step out of his or her everyday
environment and into the environment of the site re-
ceiving the solution.
The day-long visit consists of an opening meeting,
Previous process New process
90
80
70
60
50

• The project charter.

• A high-level review of the original proj- 40
ect. 30
• The DMAIC method and key improve- 20
ment tools used.
10
• The proven Xs of the project (for ex-
ample, root causes). 0
6/2008
7/2008
8/2008
9/2008
10/2008
11/2008
12/2008
1/2009
2/2009
3/2009
4/2009
5/2009
6/2009
7/2009
8/2009
9/2009
10/2009
11/2009
12/2009
1/2010
2/2010

• Project solutions.
• Pros and cons of key tools specific to
the receiving site. Month/year

June 2010 • QP 35
 Pressure-ulcer prevention rate received pushback from both depart-
ments. They were not present during the
(spread project) / Figure 6 project overview and explanation of the
10% solutions; naturally, they questioned and
9% resisted the labor and costs involved.
The opening meeting lasted one hour
8%
and involved a review of the problem’s
7%
root causes, an explanation of each solu-
Percentage

6% tion in detail and an open discussion.

Target = 5% or less
5% The facility walkthrough with the site
process owner involved verification of
4%
each solution and modification of the
3%
original solution to meet the needs of a
2% unique environment. Because one hospital
1% did not have patient admission packets, a
solution modification placed the hand-
0%
hygiene message in patient rooms rather
1/2009

2/2009

3/2009

4/2009

5/2009

6/2009

7/2009

8/2009

9/2009

10/2009

11/2009

12/2009

1/2010
than in the patient admission packets.
The walkthrough also included the
Month/year
development of an SLA to implement all
solutions by an agreed-upon date. At that
Hand-hygiene compliance rate time, a commitment of resources was
(spread project) / Figure 7 agreed upon between the process owner

100%
and the champion.
Step 11: Biweekly teleconferences.
This includes project updates and dis-
95% cussion of issues among the site teams.
Because these meetings include all dis-
semination team members, each site can
Percentage

90%
provide insights into problem resolution.
For example, the hand-hygiene team
85% brainstormed and shared the cost of pur-
chasing gel dispenser labels among three
80% sites.
Step 12: Fully implement the SLA.
Work on this step begins immediately
75% following the on-site visit. The process
1/2009

2/2009

3/2009

4/2009

5/2009

6/2009

7/2009

8/2009

9/2009

10/2009

11/2009

12/2009

1/2010

owner should verify the SLA is complete

Month/year
with all stakeholders invited. This includes the site
champion, process owner, dissemination team mem-
bers and all staff members who come in contact with
the process.
During two of our PHS dissemination projects, we
discovered that maintenance and purchasing were
overlooked during the site visit. Because of this, we
before the project manager schedules the
on-site project audit.
Step 13: On-site audit to verify so-
lutions. A few site process owners said that knowing
an on-site audit was coming kept the dissemination
project a priority for them. The original site-specific
SLAs were used by the auditors as the audit checklists
for each site. The process owner was responsible for
leading the audit by demonstrating proof that each so-
lution had in fact been implemented.

36 QP • www.qualityprogress.com
 innovation

The SLA proved to be a useful tool by Emergency department co-pay

allowing someone other than the project
manager to be the auditor. This also al-
collection rate (spread project) / Figure 8
lowed staff members, who were already 16%
going out to the regional hospitals on
14%
other business, to act as auditors. The av-
erage audit time required for each project 12%
was one hour.
10%

Percentage
Step 14: Put a control plan in place.
A control plan was developed for each 8%
dissemination project. Each plan focused
6%
on relevant control subjects with ongoing
data collection and monitoring for sus- 4%
tainability. For an example, see “Emer-
gency department co-pay control plan” at 2%
www.qualityprogress.com.
0%
Step 15: Close project. After the SLA 8/2009 9/2009 10/2009 11/2009 12/2009 1/2010
is complete, the project BB continues to Month/year
monitor and report on the project status
for four months at the project tracking
meeting. If the project remains in control during that Clark Carboneau is a lean Six Sigma Black Belt
at Presbyterian Health Services in Albuquerque. He
time, the BB officially closes the project. The control earned a Deming Scholar MBA from Fordham Univer-
sity in New York. Carboneau is a senior member of
metrics continue to be monitored on an executive ASQ and a certified manager of quality/organizational
council scorecard for another 12 months. excellence.

By following these steps, PHS saw the improve-

ments of its main site duplicated throughout the or-
ganization (see Figures 6-8). In the process, it ensured
future results that begin as one location’s achievement
can be turned into widespread success. QP
Jon Banks is a lean Six Sigma Black Belt at Presbyte-
rian Health Services. He earned a bachelor’s degree in
occupational therapy from Colorado State University
in Fort Collins.

References
1. Clark Carboneau, “Using Diffusion of Innovations and Academic Detailing to
Spread Evidence-Based Practices,” Journal for Healthcare Quality, 2005, Vol.
27, No. 2, pp. 48-52. Tony Armijo is a lean Six Sigma Black Belt at Pres-
2. Carol VanDeusen Lukas, “Implementation of a Clinical Innovation: The Case byterian Health Services. He earned an MBA from the
of Advanced Clinic Access in the Department of Veterans Affairs,” Journal of College of Santa Fe in New Mexico. Armijo is a senior
Ambulatory Care Management, 2008, Vol. 31, No. 2, pp. 94-108. member of ASQ and is a certified quality auditor and
3. Clark Carboneau, Eddie Benge, Mary T. Jaco and Mary Robinson, “A Lean Six Sigma Black Belt.
Six Sigma Team Increases Hand Hygiene Compliance and Reduces Hospital
Acquired MRSA Infections by 51%,” Journal for Healthcare Quality, January
2010.
4. M. Rashad Massoud, Gail A. Nielsen, Kevin Nolan, Marie W. Schall and Cory
Sevin, “A Framework for Spread: From Local Improvements to Systemwide John A. Zondlo is a lean Six Sigma Black Belt at
Change,” Institute for Healthcare Improvement Innovation Series white Presbyterian Health Services. He earned a master’s
paper, 2006. degree in hospital administration from the University
5. Marjorie L. Pearson, Valda V. Upenieks, Tracy Yee and Jack Needleman, of Minnesota.
“Spreading Nursing Unit Innovation in Large Hospital Systems,” Journal of
Nursing Administration, 2008, Vol. 38, No. 3, pp. 146-152.
6. Everett M. Rogers, Diffusion of Innovations, Free Press, 2003.
7. Malcolm Gladwell, The Tipping Point, Little Brown, 2002.

SPREAD THE WORD

Initiating an improvement project organizationwide is a process fraught with obstacles.
Share your tips for overcoming them by using the comment tool on this article’s page
at www.qualityprogress.com.

June 2010 • QP 37
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nulputpatum dolor iusto odolore rciniat,
indents. metrics,
se venis ad dunt lum ip ea facidunt eanot
such as ideas per employee, may am,yield
veleniam volortinit
expected results.

2 QP • www.qualityprogress.com June 2010 • QP 39

 Unlike data-driven methods such as Six Sigma, in
which the learning process is more predictable, suc-
cessful innovation training depends on an individual’s
creative ability. There is no known way to automate
an individual’s thinking processes to generate ideas.
Some of the popular approaches to idea generation,
such as brainstorming, are mostly based on trial and
error, and have unpredictable success rates.
In our daily lives, we run into problems that require
creative solutions. But that doesn’t mean we always
solve them creatively. The creative solution is a simple
solution to a problem that, from the standpoint of con-
ventional thinking, requires complex and expensive
solutions. The paradox of the creative innovation is
that although it is relatively easy to come up with a
complex innovation, a simple, unconventional innova-
tion is by no means an easy task.
It’s electric
There is a lesson to be learned from two great inven-
tors—Thomas Edison and Nikolai Tesla. Edison is well
known for his recipe for innovation: “Genius is 1% in-
spiration and 99% perspiration.”1
Edison filed for 1,093 patents during his lifetime,
and his approach was simple: Conduct a large number
of simultaneous experiments on every possible idea.
For any invention, his army of 1,000 researchers would
check out 1,000 different ideas in each trial. To discov-
er the right material for the carbon light-bulb filament,
more than 6,000 experiments were conducted.2 For the
nickel-iron battery, 10,296 experiments were carried
out.3 The alkaline cell required 50,000 tests.4
Tesla’s pertinent observation sums up the woes of
adopting Edison’s approach to product design or prob-
lem solving: “If Edison had a needle to find in a hay-

Types of Psychological Inertia

1. Inertia associated with the usual functioning of an object (a computer mouse can be used only for mov-
ing the cursor on the screen).
2. Terminological inertia or the use of technical jargon (reduction of “synthetic inventory” in corporate
banks).
3. Inertia caused by usual form or appearance (scientists must wear white coats).
4. Inertia caused by usual properties, conditions or parameters (team must always have a manager).
5. Inertia caused by usual principle of action or area of knowledge (the application of new lean concepts to
manage a team of software professionals).
6. Inertia caused by usual composition or components (a data-entry operation must have a person keying
in values into the system).
7. Inertia caused by usual constancy of an object or character (calls to a technical support desk must
always progress from lower-skilled staff to higher-skilled staff).
8. Inertia caused by usual dimension (in a call center, there can’t be more than one customer-service rep-
resentative talking to one customer).
9. Inertia caused by a nonexistent prohibition (you shouldn’t make a sales pitch to an irate customer).
10. Inertia caused by habitual action (underwriting work for any particular customer case cannot be split
among several underwriters).
11. Inertia caused by a single solution (the tendency to stop exploring other solution ideas).
12. Inertia caused by mono-object (silo-based thinking to process improvement).
13. Inertia caused by usual value, or importance, of the object (software must be tested by an independent
team of testers before release).
14. Inertia caused by traditional conditions of an application.
15. Inertia caused by the known pseudo-similar solution, or the tendency to superficially apply the similar
solutions that worked in the past (reward structures).
16. Inertia caused by superfluous information (the tendency to provide or seek information not related to
the core of the problem). —A.B.

40 QP • www.qualityprogress.com

Innovation is no longer considered the exclusive
realm of scientists. The power to innovate is
now in the hands of ordinary people.
stack, he would proceed at once with the diligence of
a bee to examine straw after straw until he found the
object of his search. I was a sorry witness of such do-
ings, knowing that a little theory and calculation would
have saved him 90% of his labor.”5
So why should we concern ourselves with a couple
of scientists quibbling over their differing approaches
to scientific research? Most of us in the service indus-
try work on mundane customer transactions and don’t
intend to file patents any time soon. Right?
At the beginning of the innovation journey, many or-
ganizations find that most of their employees are mim-
icking Edison in their trial-and-error approach to any
situation. If you’ve witnessed a senior manager clutch-
ing his head and pleading with his charges to use their
brains before they act, then you’ve seen a live example
of the frustration with this trial-and-error mind-set.
Innovation democratization
Is innovation a stroke of luck or genius, or is it a skill
that can be acquired by anyone? This question has
troubled mankind throughout history.
Psychologist Edward Thorndike described the trial-
and-error method and said the key to problem solving
lies in the acquisition of rational skills through a mul-
tiple repetition of random attempts.6
Genrich Altshuller, the founder of TRIZ (a Russian
acronym for “theory of inventive problem solving”) car-
ried out in-depth research of the patents database to
determine whether there were underlying patterns to
problem solving. His research showed that innovation
was not the result of a magical stroke of luck or genius,
but rather a skill anyone can develop.7
His research, supported by a growing fraternity of
scientists, eventually culminated in the algorithm of
inventive problem solving (ARIZ). To many people, the
idea of creating an algorithm to guide innovation was
counterintuitive. With the development of TRIZ, inno-
vation is no longer considered the exclusive realm of
scientists. The power to innovate is now in the hands
of ordinary people.
Innovation
That’s a potential positive for an organization, but it
can’t be maximized until you know what type of brain-
power you have on staff.
People with unskilled minds are characterized by
the lack of boldness in their thinking. When confronted
with difficult problems, the unskilled adopt a trial-and-
error approach to solving them. On the other hand,
skilled innovators differ in their ability and the speed
at which they find the contradiction in the problem and
generate bold ideas to resolve it.
Scientists refer to this as an ability to overcome
psychological inertia, which is one of the core traits
of successful innovators (see sidebar, “Types of Psy-
chological Inertia”). The other is knowledge of ARIZ.
These skills allow successful innovators to identify the
hidden contradictions in any situation and resolve the
identified contradictions based on the proven princi-
ples used by great inventors.
Acquiring mastery over a subject and training the
mind to overcome psychological inertia requires many
hours of training, followed by demonstrated applica-
tion on a project. Here’s an example application:
A large telecommunications company in an emerg-
ing economy has millions of subscribers, who receive
telephones for the duration of their subscription peri-
od. Distribution is managed through a large franchisee
retail network that includes several thousand outlets.
The franchisee is the point of contact for all custom-
ers. If the customer terminates the service for any rea-
son, the franchisee recovers the telephone on behalf of
the company and returns it to the company warehouse,
where it can then be reused for a new customer.
A company audit found that hundreds of thousands
of telephones were not yet recovered. The reasons the
auditors identified included the customer still possess-
ing the telephone, or the telephone being at the com-
pany’s warehouse but not accounted for.
The company wants to recover the phones and,
more importantly, set up a process to ensure the situ-
ation does not happen again. How would you help re-
solve this problem?
June 2010 • QP 41
 To better appreciate the difference between the ap-
proaches adopted by skilled innovators and unskilled
minds, present the situation to your staff. Ask them for
input to set up a process to ensure this problem does
not arise in the future.
The 4P solution
When presented with any problem-solving scenario,
those with unskilled minds tend to come up with safe
ideas that can be broadly classified as punish, pay,
plead and pray. Using the telecommunications exam-
ple in the sidebar, here are a few ways the four catego-
ries are applied:
Punish:
• Punish franchisees by imposing a penalty or a fine
for unrecovered phones and by imposing tougher
contracts on new and existing franchisees.
• Punish customers by not refunding their security
deposits and charging heftier security deposits from
new customers.
• Punish the business unit heads of each region for
bad recovery rates, telling them to correct the situa-
tion or face dismissal.
Pay:
• Provide incentives to the franchisees to recover and
return the phones.
• Provide incentives to the customers to return the
phones.
Plead:
• Appeal to the customer’s common goodwill and
conscience.
• Appeal to the franchisee’s common goodwill.
• Appeal to the staff to minimize business losses.
Pray:
• When the previous ideas stop working, those with
unskilled minds will hope for things to improve and,
at the same time, plan for a write-off of bad assets.
Those approaches do not yield a robust solution
that will prevent the problem from recurring:
• Punishing the franchisees and the customers will
only hurt market share in the long run.
• Providing incentives is a way of rewarding bad prac-
tices.
• Appealing to the customer’s conscience may work
only for limited scenarios, such as when linked to
religious or similar emotive topics.
• Writing off bad assets will simply erode the financial
worth of an organization.
42 QP • www.qualityprogress.com
A good approach
The following is a simplified representation of an effec-
tive innovator’s four-step problem-solving approach:
1. Identify the hidden conflict or contradiction in the
problem. Innovations happen only when we resolve
contradictions.
2. Envision the ideal solution using ideality—a techni-
cal concept of TRIZ—that envisions a scenario in
which the source of the problem solves the prob-
lem. Another simplified understanding of ideality
is the ability to obtain the useful functions of the
process without needing the process to exist.
3. Explore a wider canvas of solution space free from
psychological inertias.
4. Make use of readily available resources to formulate
solutions that are cost effective and easy to deploy.
Now, apply each step to the telecommunications
example:
1. One of the contradictions at the heart of the problem
is that if we provide incentives to the franchisees to
retrieve the phones, we will be able to retrieve most
of them. But we run the risk of franchisees seeking
more incentives over time, leading to increased cost
of operations.
2. By applying the concept of ideality, the innovator
can formulate ideas that allow the organization to
retrieve phones without using complex tracking
mechanisms.
3. Consider a situation in which you are walking with
your loved ones, and someone tries to pull you away
against your will. As you are being dragged away
from them, you can see them clearly, but they are un-
able to see you. What would you do? Most likely, your
answer would be to yell out to them while struggling
to free yourself from your captors. So, what if the
phone were to yell out, asking to be rescued? What
if it made so much noise that the abductors were
forced to hand it over back to you? Is that nonsensi-
cal or infeasible? Perhaps not. All non-trivial ideas
appear that way the first time they are presented.
4. The innovator then explores readily available re-
sources to turn the ideas into a feasible solution
concept. A spare battery would allow the phone to
emit emergency signals to communicate with the
network, even if the phone is disconnected from the
main power supply. At the same time, technology
can be used to make the phones of terminated ac-
counts emit irritating sounds that force the customer
 Innovation

to approach the franchisee to fix the problem or to
turn over the phone.
Are there problems that need to be fixed before the
solution can go live? Yes, but the innovator’s mind will
Aditya Bhalla is innovation practice head at QAI
Global in New Delhi, India. He earned a master’s
degree in management from the Institute of Manage-
ment Technology in Ghaziabad, India. Bhalla is an ASQ
member and is a certified Six Sigma Master Black Belt
and level 3 TRIZ practitioner.

be able to generate ideas and systematically cull the neg-

ative elements to arrive at a mistake-proof final concept.
As this example demonstrates, organizations need
to invest in training to help their employ-
ees acquire the traits of the skilled innova-
tors. When that happens, the organization
can succeed in solving day-to-day prob-
lems with non-trivial ideas.

Get on the train

Different strokes for different folks. That
cliché is applicable to organizations seri-
ous about training their staff members to
unleash their full thinking potential and
overcome psychological inertia.
Sending staff to innovation or creativity
workshops does not provide for sustain-
able results because each mind has its own
pace of development. Short-term exposure
in a workshop does not allow the partici-
pants to evolve and adopt the new way
of thinking at their self-determined pace.
When the participants go back to their
posts, old thinking habits will set in, and
their initiative will be lost.
A blended learning approach allows
each person’s mind to follow its own pace
of development. It also provides manage-
ment the opportunity to identify the innova-
tors who exist within the organization. This
group can be leveraged to formulate non-
trivial ideas ranging from launching new
products to fixing complex problems. QP

References
1. The Quotations Page, “Thomas A. Edison,”
www.quotationspage.com/quote/2054.html.
2. The Franklin Institute, “Edison’s Lightbulb,” www.fi.edu/
learn/sci-tech/edison-lightbulb.
3. Grace Products Corp., “The Life of Thomas Edison,” www.
graceproducts.com/edison/life.html.
4. Thomas Alva Edison Foundation, “Useful Science Projects
From Edison,” www.charlesedisonfund.org/experiments/
edison-pdf/edison_ch6.pdf.
5. Thinkexist.com, “Nikola Tesla Quotes,” http://thinkexist.
com/quotes/nikola_tesla.
6. New World Encyclopedia, “Edward L. Thorndike,” www.
newworldencyclopedia.org/entry/Edward_L._Thorndike
(case sensitive).
7. Selectorweb.com, “TRIZ,” www.selectorweb.com/triz.html.

June 2010 • QP 43
added
by Alex Fedotowsky

In 50 Words
Or Less

Fine-tune your balanced

• A balanced scorecard
(BSC) can be used as
a cyclic, continuous
improvement tool to
create synergy within
an organization.
• Incorporating lean,
scorecard and make it a
Six Sigma, theory of
constraints and con-
tinuous improvement
machine geared toward
methods into the BSC
can help link individual
projects and activities
continuous improvement
to strategic goals and
can change an organiza-
tion’s culture.
 BALANCED SCORECARD

The balanced scorecard (BSC) is accepted in the busi-

ness world as a valid instrument with which to translate and deploy an organi-
zation’s business strategy throughout its infrastructure.
The BSC was first developed by Robert S. Kaplan and David P. Norton as a
tool to link the traditional financial lagging metric to three leading metrics of
learning and growth, process and customer. At about the same time, Lawrence
Maisel developed a similar scorecard approach.

June 2010 • QP 45
 The four metrics, sometimes referred to as per-
spectives, have associated key performance indica-
tors (KPI). The senior management team normally
determines the KPIs to link leading indicators (people,
process and customer) to the lagging indicator (finan-
cials).
To ensure the successful deployment of a BSC, mul-
tiple levels of linked KPIs must cascade through divi-
sions, departments and the individual performance or
shop level. When an organization can link the perfor-
mance of an individual or the smallest unit to top-tier
KPIs, you know you have a working BSC.
What must an individual worker, supervisor or man-
ager do each day to move a KPI in the right direction?
The cascaded KPIs can provide managers a way to
motivate workforce behavior and improve operations
within their control in real time and anticipate finan-
cial or performance results.
Deploying a completely linked BSC, however, is not
easy. Many organizations struggle to make the BSC
work as it’s intended. In some cases, they simply sub-
stitute poorly selected leading metrics to satisfy stake-
holders.
The BSC can and should be used as a cyclic, con-
tinuous improvement tool to create a synergy not eas-
ily achieved by competitors. The BSC has the ability to
integrate lean, Six Sigma, theory of constraints (TOC)
and continuous improvement methods into a cohesive
unit that can change an organization’s culture and help
it achieve its strategic mission.
People seem to react positively to posted metrics
with goals set by the BSC objectives. When business
strategy is deployed through a BSC, a knowledgeable
workforce will deliver the solutions to meet the goals.
Balanced scorecard (BSC)
cycle / Figure 1
PDCA cycle BSC cycle
People
Act Plan
Financials Process
Do
Check
Customer
46 QP • www.qualityprogress.com
A new look BSC
Since its conception, the BSC has gone through multiple
designs and changes to fit organizational goals; how-
ever, this new way of designing a BSC, which combines
lean, Six Sigma, TOC and continuous improvement, will
create higher visibility for improvement projects.
Lean, Six Sigma and TOC all use a cyclic structure
to continuously improve and achieve desired busi-
ness results. Walter A. Shewhart introduced the plan-
do-check-act (PDCA) cycle (and W. Edwards Deming
popularized it) to provide a systematic method to solve
problems by applying scientific methods and then
moving to the next problem. Cycles of logical steps
have become a proven way to continuously improve.
By using the BSC, can the improvement cycle be
used at the strategic business level? The primary stra-
tegic goal for any organization should be to always
improve in every way. The BSC can help achieve that.
Figure 1 compares the PDCA cycle with the idea of
positioning the BSC as a cycle of improvement. As the
PDCA cycle starts with the plan phase, a BSC starts
with people and repeats. When results don’t meet the
target, ask the question, “What can we do next to sup-
port our people to improve the processes that delight
our customers and generate more profits?”
We can refer to this as the people-process-custom-
er-financials (PPCF) cycle.
Cyclic nature of improvement
Typically, organizations follow one of these four pat-
terns as part of their improvement efforts:
1. Continuous improvement: PDCA and repeat.
2. Six Sigma: Define, measure, analyze, improve, con-
trol (DMAIC) and repeat.
3. Lean: Identify value, make value flow and repeat to
pursue perfection.
4. TOC: Identify the constraint, exploit the constraint,
subordinate everything to the constraint, elevate
the constraint and repeat.
What’s missing in each of these four patterns is an
established BSC that can make a difference. Building
a BSC, complementing it with the PPCF cycle and re-
peating as necessary should be an option all organiza-
tions must consider.
At Organization X, for example, lean Six Sigma proj-
ects were not directly linked or referenced to a top-tier
KPI. When the BSC is designed to function as a cyclic
continuous improvement instrument pulling lean, Six
 BALANCED SCORECARD

Sigma and theory of constraints (LSSTOC) projects to
move KPIs in a positive direction, the organization has
a well-developed improvement system.
In many organizations, LSSTOC efforts are often
ancillary and not linked to the organization’s strategy.
Maybe that’s why LSSTOC projects are often referred
to as the flavor of the month, or they move sluggishly—
because they do not have senior management’s full at-
tention.
When each person, manager and department can
clearly see how their efforts positively affect a metric
for the organization to be more successful, the culture
will change. The workforce will see the business need
to support and drive LSSTOC projects toward success,
with their ideas leading the charge. The BSC has the
ability to make that culture change happen.
Organizations that have a working BSC can achieve
satisfactory results within segments of their organiza-
tions. But gaps can exist that consist of incomplete
links from work-area performance to the organization’s
top-tier KPIs. For example, back at Organization X, a
BSC was deployed as a quality sustainment instrument
but not as a governing, organizationwide improvement
instrument. In this situation, quality metrics (outputs
from processes) were sometimes confused as process
metrics.
Table 1 is a model of a BSC structure that required
updated improvements to create a structure to link the
cascaded KPIs. In this case, there was only one level
of metrics at the departmental level. This scorecard
did not provide linked information to improve from
red (alert) to yellow (warning) to green (acceptable)
status. The BSC structure had missing metric links and
lacked well-defined improvement objectives.
In this example, the department was in constant
firefighting mode from the supporting units that had no
local scorecard to gauge their impact on the depart-
mental-level metrics, and a corporate-level scorecard
didn’t exist. The goal of the new design was to create
a clear path from individual performance from local
work-area metrics to the top KPIs (see Table 1).
A project was completed to develop a BSC model
in which the improvement method would become the
framework to transform the organization into a con-
tinuous-improvement enterprise. The next step was to
design a BSC to best illustrate the new top-level cyclic
BSC.
The Maisel model provides a good BSC founda-
tion for designing a flow of strategy deployment and
upward assessment. The structure in Figure 2 (p. 48)
would greatly benefit from better-defined metrics sepa-
rated and aligned with newly introduced top-tier KPIs.
In this case, there were no operational definitions
documented to communicate consistency of metric

Single level of scorecard metrics at

department level / Table 1
Scorecard objective Metric Target Status
Process—sustain repair ISO audits Pass all audits with
station no major findings
Customer—align to Defect rate Zero defects
customer expectations
On-time delivery 95% on-time delivery
Monthly posted
People—improve work Supervisor work-area Weekly on first day color-coded status
environment assessment report of week resulting in daily
firefighting in
Town hall meetings Monthly on first day
attempt to
of month
change status
People—optimize Manager, supervisor 80% trained
workforce effectiveness training

Management performance review • On-time delivery: 87% (yellow)

Personnel goals and actions not linked to • Leadership training: 85% (green)
improve local, department or corporate-level
balanced scorecard metrics. • Defect rate: 22% (red)
• Audits: 100% compliance (green)

June 2010 • QP 47
 meaning. The LSSTOC improvement efforts will deliver
new process metrics such as throughput, cycle time and
process yields. To improve the BSC, the organization
needs to pursue a way to integrate the improvement
metrics, cyclic nature and language through the struc-
ture of the new scorecard’s design.
The power of the BSC lies in its ability to change
the culture, focusing on the people KPIs that will drive
the desired results in the process KPIs. Improving the
process KPIs will improve the customer KPIs. When
customers are satisfied and the BSC strategy is to seek
higher levels of customer satisfaction, you can expect
positive results recorded in the financial KPI. When
you continue this cycle, expect even better customer
satisfaction and financial results.
We developed a generic version of the new BSC
model. Up until now, the BSC has been successfully
deployed primarily to sustain quality requirements.
A new BSC is designed to incorporate LSSTOC and
continuous improvement language into the core
strategy and provides the leading indicator with the
initiatives to ensure financial (the lagging indicator)
success.
The future of the BSC is to fit LSSTOC and the score-
card together as a cohesive force. Competitors who
cannot accomplish this synergy will fall further behind
in their attempts to gain market share from organiza-
tions that have accomplished this feat. By cascading
the same structure, understandable improvement lan-
guage, and metrics into all organizational levels, the
BSC becomes easier to read and use to improve the
business.
Alignment model of BSC metrics
You can look at the BSC structure in five parts to un-
derstand how the levels of an organization can report
the KPI results from the work area and line them up
with corporate KPI metrics to work toward business
objectives. Depending on the size and levels of your
organization, you may require fewer levels.
1. Top-tier organizational KPIs.
• Financial KPI = Quarterly reported financial
reports.
• Customer KPI = Monthly average customer
satisfaction index reported from departments.
• Process KPI = Monthly average throughput
reported from all departments.
• People KPI = Total average employee retention

Corporate top-tier key performance indicator

metrics trend chart / Figure 2
People Process Customer Financials

Workforce Total monthly Total Quarterly

employee average reported operation cost
retention rate throughput. indexed savings.
for entire customer
workforce. Total monthly satisfaction. Quarterly
average revenues and
Percentage cycle time. Total profits.
of workforce reported
trained in lean, Total montly monthly
Six Sigma and average on-time
TOC. quality first deliveries.
pass yield.
Total number
of employee-
implemented
improvements
per month.

People driving processes to satisfy customers to improve financials

TOC = theory of constraints

48 QP • www.qualityprogress.com
 BALANCED SCORECARD

Work-area key performance indicator metrics

trend chart / Figure 3
People Process Customer Financials

Quarterly Monthly Percentage Work

employee throughput. on-time area/shop
retention rate. deliveries. savings/cost
Monthly avoidance.
Quarterly lead times. Monthly
percentage customer Vendor parts
workforce Monthly complaints. and materials
trained. quality first cost reduction.
pass yield.
Number of
employee-
implemented
lean ideas
per month.

People driving processes to satisfy customers to improve financials

rate reported from all departments.
2. Departmental KPIs.
• Financial KPI = Quarterly reported department
operating costs and savings.
• Customer KPI = Monthly average reported
customer feedback ratings.
• Process KPI = Monthly average work areas
throughput.
• People KPI = Monthly average employee
retention rate reported from all shops.
3. Work-area KPIs.
• Financial KPI = shop operating costs.
• Customer KPI = monthly reported complaints.
• Process KPI = monthly shop or work-area
throughput.
• People KPI = work-area employee retention rate.
4. Management performance review KPIs.
• Financial KPI = quarterly reported work-area
operating costs and savings.
• Customer KPI = monthly number of complaints
reported to manager.
• Process KPI = monthly value-added work
throughput in supervised area.
• People KPI = leadership skills assessment.
5. Posted work-area metrics. These will motivate
the workforce to make improvements that link to
the organizations’ top KPIs (for example, cycle time,
throughout, work in progress and on-time deliveries).
Figure 2 illustrates scoreboard layout for a cor-
porate top-tier KPI trend chart as posted throughout
the organization in key areas. The people, process,
customer and financial labels with arrows provide
the workforce a sense of direction and involvement
to help management achieve the business goals. This
layout can be used at all levels that link to the top-tier
scoreboard.
Figure 3 illustrates a scoreboard for a localized
work area. At this level, the involvement becomes
more meaningful in the workforce’s daily activities and
helps the workforce believe it can make a difference.
After lining up the cascaded KPIs, the next goal is
to show how a BSC can serve as the big-picture, cyclic
improvement machine for any organization. The model
is designed to link the ground-level shop and manag-
er’s performance metrics through department metrics
and toward the organization’s top-tier KPIs.
With this model, management will have a cyclic
path to perpetually communicate strategy through the
organization’s infrastructure and have an assessment
tool to link projects and activities upward through the
organizational layers achieving strategic goals.
The paramount goal of any organization should be
to continually improve. A BSC designed to facilitate
continuous cyclic improvements to achieve a strategic
goal should become the primary instrument an organi-
zation uses.

June 2010 • QP 49
 Online Tables 1-4 at www.qualityprogress.com pres- step process to identify and elevate system constraints,
ent the new model, starting with the top-tier corporate the cascaded alignment of the BSC metrics can serve
scorecard. The tables illustrate the connecting struc- to detect organizational higher-level constraints at the
ture of the KPI metrics, actions and goals needed to work-area and department levels. The senior manage-
achieve the organization’s desired strategic targets. ment team will have almost real-time knowledge to
The model’s purpose is to illustrate how to commu- help it allocate resources that alleviate the constraint
nicate with the BSC. In reality, a fine-tuned BSC with and move on to the next constraint. Figure 5 illustrates
objectives, action plans and measures should be word- how you can follow the trail.
ed more precisely to ensure everyone knows the goals
and what must be done. Workforce-driven results
The BSC will work if you keep the metrics structure The BSC is a proven instrument to deploy strategy
simple, show how it’s meaningful to the workforce, use and tie activities from all levels that help achieve the
it as motivation and show its cascading alignment. Fig- strategic goals. The BSC can be used as the primary
ure 4 is the final presentation of what a well-aligned instrument to achieve financial results with customer
BSC model focused on continuous improvement can satisfaction through better processes driven by the
look like to make sense to stakeholders. workforce.
Finally, if you are familiar with Eliyhu Goldratt’s five- In the earlier example of Organization X, the core

Balanced scorecard (BSC) visible cascading structure / figure 4

Corporate KPIs
Corporate BSC Strategic objective Action plans Measures
perspectives
Financials • Validated total savings by management • Improve on leading KPIs starting with • Overall project cost
Lagging KPI and customer. people perspective (PDCA cycle). savings reported.
KPI = monthly • Total lowered operating costs. • Identify new lean Six Sigma projects. • Corporate financial
operating costs
and reported
• Validated revenue profits increase. • Update top-tier KPI metrics. reports.
Assessment
Departmentopportunities
• Future improvement level Strategic objective Action plans • LSSTOC projects savings
Measures
profits
presentedBSC perspectives
customer. presented.
Linking work-area activities
• Increase Financials
customer satisfaction.• Validated savings
upward through the BSC layers
Customer • Weekly by meetings
management • Improve on leading
with customers. KPIs starting • Overall project cost savings
Organizationwide
Leading KPI Lagging KPI and customer. with people perspective (PDCA reported.
• Retain existing customers. • Teams evaluate products and • Customer satisfaction
costs.using QFD tools. cycle).
KPI = customer
satisfaction
KPI = monthly
• Win back lost customers.
department
• Lower operating services
• Validated revenue
• Visit profits increase.
customer site monthly. •
index.
• Identify new LSSTOC projects.
Percentage complaints.
• Corporate financial reports.
• LSSTOC projects savings
achieving strategic goals.
index • Reduce customer
operatingoperating
costs costs.
• FutureUnit/shop
improvement levelopportunities
BSC Strategic • Update
objective and post department Action plans presented. Measures
Process Total averaged: •customer.
Complete LSSTOC projects that
perspectives
presented KPI metrics. Organization averaged
Leading KPI • Reduce cycle time. impact system constraints and voice process metrics:
Customer Financials
• Increase customer satisfaction. • Validated savings
• Weekly by finance
meetings with • Improve on leading
• Customer KPIs starting
satisfaction rating.• Overall project cost savings
KPI = of the customer priorities.
Leading KPI
• Reduce WIP. Lagging KPI
• Retain existing customers. customers. • Throughput.
department. with people perspective (PDCA
• Percentage complaints.
reported.
production • Maintain organization metrics. • Cycle time.and cycle), continue lean and CI
• Increase KPI = customer
throughput. KPI = monthly shop • Lower• operating costs
Teams evaluate reported.
products • Corporate financial reports.
throughput • Win back lost customers.
• Facilitate initiatives.
satisfaction index operating costs employee ideas toservices
improveusing
• Future improvement QFD
WIP. tools.
•opportunities • Lean Six Sigma projects
• Increase quality and yield. processes. • Update and post shop KPI
Process Department targets: presented
Personnelto management.
• Complete BSCLSSTOC projects
• Quality
Evaluation yield.
Strategic Department
that metrics. Objective averaged process savings presented.
Action Plans Measures
Leading KPI impact system constraints and metrics:
People (priority) • Train and retain entire 100% of •workforce
Reduce cycle
Customer
time training for employees
• Provide Financials
• Increase to
internal • Percentage •of Validated
customer • Weeklywork area with
meetings savings.
cross-• Improve on leading
• Percentage of KPIs
complaints from• Work project cost savings
KPI improve
= production voice of the customer priorities.
(Learning and to meet and ability to meet/
• Reduce WIP. improve
Leading KPI processes. satisfaction.
Lagging KPI employees trained in• Throughput.
functional teams. starting with people
external customers. reported.
• Validated 100% on-time
growth) throughput
exceed customer requirements. • Deploy and maintain lean Sixweekly/
Sigma and • Cycle time. perspective (PDCA cycle).
Leading KPI • Increase =•customer
Senior leaders periodically
KPIthroughput. • 100% visit work
Performance
on-time
monthly
KPI = work
delivery.
work area metrics.
required job
delivery.
• Root cause tools and analysis
skills. • Percentage of complaints from • Corporate financial reports.
• Develop and support genuine leadership area.
complaints area cost avoidance savings. • Future on •complaints.
WIP.saving • Assure updatecustomers
internal and posted
• Increase quality and yield. • Zero complaints. cost • LSSTOC projects savings
KPI = employee and teamwork throughout organization. • Facilitate employee ideas to
• Conduct periodic team meetings with • Employee retention rate.
improvement
• Qualityopportunities
yield.
KPI metrics in your area of presented.
retention rate • Involve entire workforce to improve work Process improvement agenda. • Reduce improve
cycle time processes. • Complete
• Number of implemented
presented byselected area lean management.
your staff. Shop area process metrics:
Leading KPI Sixper
•Sigma projects.
People (Priority)
processes.
(Learning and
• Train and
to meet
retain 100%anofemployee
• Deploy workforce
• Reduce
idea • Provide
WIP
Customer
trainingimprovement
for employees ideas
Set targets
Percentage
Work-area posted KPI metrics trend charts
of employees trained
• Throughput.
• Weekly meetings with your • Internal Customer satisfaction
KPIand improve
= production ability tosystem.
implementation meet/
• Increase
to have skills toemployee.
throughput
improve • Deploy in and
LSSTOC and required
maintain weekly/job skills.
customers.
• Cycle time. index.
growth) exceed customer requirements.
throughput Leading KPI = percentage
processes. • Increase
monthly internal customer
work area metrics.
• Employee retention rate.
BSC = balanced scorecard Leading KPI
KPI = key performance indicator
• Develop and support genuine • Increase
on-time delivery
quality
• Managers
customer.
and to internal
yield
periodically visit work People
satisfaction.
• Facilitate
• Number employee Process
• Maintain
• WIP.and post real-time
ideas to percent delivery metrics.
of implemented Customer
• Percentage of complaints
Financials
KPI = employee leadership and teamwork (cross- area. • 100% on-time
improve delivery.
processes. • Quality yield.
WIP = work in progress improvement ideas per
retention rate departmental, shop). • Conduct periodic team • Zero complaints.
meetings employee.
PDCA = plan-do-check-act People (Priority) • Train and retain 100% work area • Provide training for employees • Percentage employees trained
QFD = quality function deployment
LSSTOC = lean, Six Sigma, Theory of Constraints
• Involve
processes
workforce
(learning andto improve work workforce with
Process
within their area of ability•toDeploy
toimprovement
meet and improve Quarterly
agenda.Workto have
area skills to improve
• Percentage
improvements Monthly
of employees
with • Complete in LSSTOC
LSSTOCand required
projects Percent
thatjob Work area metrics for process Work
growth) meet/exceed customer
KPI =a throughput.
employee idea processes.
targets. participating in improvements. impact skills.
work area constraints. you manage.
influence.
Leading KPI
Leading
requirements.
implementation system. • Reduce employee
• Supervisor
throughput.
in work area daily.
cycle time. • Employee
• Deploy retention
and maintain
on-time
rate. • Throughput.
weekly/
area/shop
BSC = balanced scorecard KPI = shop employee • Supervisor leadership training. retention
• Conduct
• Reduce rate.team
WIP.periodic monthly work of
• Number area metrics.
implemented •deliveries.
Cycle time. savings/cost
retention rate
KPI = key performance indicator
WIP = work in progress
• Involve 100% shop workforce to meetings
• Increase with improvement•
throughput. Monthly improvement
Facilitate employee ideas
ideas per
to • WIP. avoidance.
improve work processes within agenda. improveemployee.
processes in work
PDCA = plan-do-check-act their area of influence. Quarterly
• Increase yield.
• Deploy a shop employee idea
lead
area. times. •Monthly
FPY.
• Percent of employees
QFD = quality function deployment
LSSTOC = lean, Six Sigma, Theory of Constraints People (Priority) percentage implementation
• Provide system.
100% training for • participating
Schedule technicalinand lean •customer
improvements.
Percentage of employees Vendor parts
(learning and growth) your workforce. skills training. trained in LSSTOC and job skills.
BSC = balanced scorecard
KPI = key performance indicator
Leading KPI = supervised
workforce Monthly
• Develop and display genuine • Conduct daily team meetings
complaints.
• Employee retention rate.
and materials
WIP = work in progress area employee retention trained.
leadership to motivate your quality first agenda.
with improvement • Number of implemented cost reduction.
PDCA = plan-do-check-act rate workforce. •pass
CI = continuous improvement • Lead workforce to improve
Implementyield.
daily ideas from
employees in your work area.
improvement ideas per
employee.
LSSTOC = lean, Six Sigma, Theory of Constraints Number of within their
work processes • Percent of employees
area of influence.
Management employee participating in improvement.
BSC = balanced scorecard
implemented
Communicating strategy KPI = key performance indicator
WIP = work in progress lean ideas Supervisor addresses
downward through company PDCA = plan-do-check-act
per
LSSTOC = lean, Six Sigma, Theory month.
of Constraints resources and constraints with
FPY = first pass yield
structure into the work areas. work-area
People driving processes to satisfy customers to improveemployees
financials daily that
impact the BSC metrics.
KPI = key performance indicator

50 QP • www.qualityprogress.com
 BALANCED SCORECARD

Applying theory of constraints / figure 5

Following metric trends upward,

toward top-tier KPI metrics, can
assist in identifying organizationwide
Top-tier BSC organization’s
system constraints that impede
KPI Metrics
positive BSC results.

Department Department Department

BSC metrics BSC metrics BSC metrics

Unit BSC Unit BSC Unit BSC Unit BSC Unit BSC Unit BSC
metrics metrics metrics metrics metrics metrics

Work-area Work-area Work-area Work-area Work-area Work-area

performance performance performance performance performance performance
metrics metrics metrics metrics metrics metrics

• Priority (red) constraint affecting BSC results, next constraint (yellow).

• Provides the organization information on where to focus lean Six Sigma,
TOC resources to make more of an impact for the top-tier KPIs.

BSC = balanced scorecard KPI = key performance indicator TOC = theory of constraints

strategy was to improve processes to reduce cost, in-
crease customer satisfaction and be rewarded finan-
cially. The focus was on the BSC structure alone.
Of course, the BSC model must be fine tuned with
details of a real situation, requiring carefully selected
input from multilevel teams, and then linked to a mis-
sion and vision statement. Depending on your strategic
drivers and situation, your BSC could be noticeably dif-
ferent than the one in the example. The model is valid,
the organization’s improvement projects.
The future of the BSC has the logical mechanism
to link LSSTOC and the scorecard as a cohesive force.
In doing so, organizations that cannot accomplish this
synergy will fall further behind in any attempt to gain
market share. QP
ACKNOWLEDGEMENTS
The author wishes to thank the founders of the Prioritized Scorecard system,
Mike Simms and Mike Fedotowsky.

however, for organizations desiring a holistic approach

to improvement.
Incorporating people-driven LSSTOC and continu-
ous improvement activities as the priority method will
make the BSC a far more powerful tool and allow the
organization to correct inefficiencies, helping it achieve
targets set by KPIs.
BIBLIOGRAPHY
Goldratt, Eliyhu, Theory of Constraints, North River Press, 1999.
Goldratt, Eliyhu, and Jeff Cox, The Goal: A Process of Ongoing Improvement,
North River Press 2004.
Kaplan, Robert S., and David P. Norton, The Balanced Scorecard: Translating
Strategy Into Action, Harvard Business Press, 1996.
Olve, Nils-Goran, Jan Roy and Magnus Wetter, Performance Drivers: A Practical
Guide to Using the Balanced Scorecard, Wiley, 1999.
© 2010 Alexander Fedotowsky

Often, LSS projects get stuck inside a system, gener-

ating some results but nothing significant because they
don’t get the attention of senior managers. By working
with TOC in the cyclically aligned BSC model, LSSTOC
activities with limited resources can produce a greater
return on investment versus the dismal results that will
be achieved by spreading resources thinly throughout
ALEX FEDOTOWSKY is an internal lean Six Sigma consultant
in the defense aerospace industry with L-3 Communications
at Fort Rucker, AL. He has a bachelor’s degree in physics
from the Massachusetts College of Liberal Arts in North
Adams. Fedotowsky received his Master Black Belt from the
Harrington Institute and is an ASQ-certified quality manager,
software quality engineer, quality improvement associate and
manager of quality and organizational excellence. He is an
ASQ member.

June 2010 • QP 51
 3.4 Per Million
The Driving Force
Creating line of sight from strategy to process
Not long ago, I conducted a work-
shop at a client’s site to help develop a
pipeline of meaningful lean Six Sigma
(LSS) projects. Before I had a chance to
describe how I planned to conduct the
workshop, members of the client’s newly
formed project identification and selection
team began furiously rattling off project
after project.
One team member actually grabbed a
marker and began scribing on flip-chart
paper as other team members called out
ideas. This activity continued for about 15
minutes as I watched quietly and let the
situation play out.
When the commotion subsided, I
thanked them for their unsurpassed level
of enthusiasm as I retrieved a document
I received earlier that morning from the
CEO. The document was the organiza-
tion’s strategic plan.
I quietly thumbed through the document
as everyone watched and waited for me to
take control of the meeting. When I did, I
told them they had generated quite a list
in such a short period of time, and it was
evident they were proud. Side conversa-
tions suggested more than a few hoped the
meeting would be finished shortly.
Clearing my throat in a rather atten-
tion-getting manner, I asked with a fake
puzzled look on my face, “How do these
Equation for success
Planning
+ Execution
Only effective planning coupled with effective execution will yield the desired results.
52 QP • www.qualityprogress.com
BY T.M. (TOM) KUBIAK
projects support the strategic plan I have
here in my hand?”
Of course, it was a rhetorical question.
The answer was obvious to anyone who
actually read the strategic plan. Many to
most of the projects did not link to the
strategy. A few other projects’ links to the
strategy were—at best—tenuous.
The silence was deafening as the audi-
ence looked back at me with blank stares.
Mind you, this was not the first time I’ve
received blank stares. Not wanting to
break the silence with noise, however, I
remained quiet, fully expecting several of
the team members to ask, “What do you
mean?” or “Why do we care?” And I was
not disappointed. Several individuals leapt
forth and spoke in unison.
“Glad you asked,” I sighed with relief.
“Let’s talk about that.”
Earlier that week
Many organizations that have implement-
ed LSS initiatives have frequently voiced
concerns or expressed disappointment
with the extent to which the initiative
has failed to advance the organization’s
business objectives. If you have ever had
the opportunity to revive several failed
implementations, this is not particularly
surprising, as many tend to follow a com-
mon path:
/ Figure 1
= Results
1. Hire some or all of the Master Black
Belts and Black Belts.
2. Now, hire the LSS leader.
3. Announce training opportunities.
4. Now, develop or purchase the training.
5. Fill training classes with whoever signs
up.
6. Belt candidates show up without a
project or sponsor.
7. Mad rush ensues to get any type of
projects for candidates.
8. Conduct training to the level of the
candidate.
9. Projects fail as sponsor loses interest
or transfers, or candidate transfers.
10. Organization blames lean Six Sigma.
At this point, you may think this is an
exaggeration and that no implementa-
tion can be that bad. But they can be that
bad—or worse. In fact, most of the 10
points listed in the pattern happened at
my client’s organization before I arrived
that day for the workshop.
Let’s not dwell on the list of 10, however,
and focus on item No. 7: “Mad rush ensues
to get any type of projects for belt candi-
dates.”
Earlier that week, training began as
scheduled. Most candidates, however, did
not arrive prepared with projects. Those
who did bring projects brought ones
that were trivial and, for the most part,
inappropriate for LSS. Realizing its initia-
tive had just ground to a halt, the client
decided to bring me in to help.
Herding cats
It was clear from the rumblings around
the table that many of the team members
did not understand the concept of busi-
ness planning and execution. They also
didn’t seem to understand how project
selection fit into the planning and execu-
tion process.
Choose your own destiny / Figure 2
To help give them some perspective, Level of Level of
Approach Outcome
effectiveness effectiveness
I showed them Figure 1, which illus-
trates—at a very high level—how planning
(regardless of level) combined with execu- 1. All dressed up
tion generates results. In the simplest of and no place to go.
Planning + Execution = Results

terms, Figure 1 represents an equation

that can have profound effects on an orga-
nization’s survivability.
Figure 2 provides greater visibility into 2. Ready, fire, aim. Planning + Execution = Results
the impact of the level of effectiveness
of planning and execution on results,
depending on the approach taken:
1. All dressed up and no place to
go. This approach is taken when an 3. Going out of Planning + Execution = Results
business.
organization has an effective plan-
ning process but doesn’t know how to
execute. When plans are deployed for
execution, chaos often ensues. At best,
this approach yields average results
4. Luck favors fools. Planning + Execution = Results

(blue box).
2. Ready, fire, aim. Note the level of ef-
fectiveness of the processes is reversed
from the first approach. This approach
is chosen by organizations that don’t
know how to plan but do know how
to execute. While it is a foolhardy
approach, organizations choosing this
way falsely believe effective execution
can make up for poor planning. Like
the first approach, this approach, at
best, yields average results.
3. Going out of business. Organizations
that plan and execute poorly generally
don’t choose this approach. It’s usually
thrust upon them. Such organizations are
doomed to failure (burgandy box). The
only exception is the fourth approach.
4. Luck favors fools. This approach,
while identical to the third approach,
yields different results. There are the
occasional organizations that plan and
execute poorly and survive in spite of
their inabilities. Of course, some orga-
nizations like to cite their exceptional
results, as shown by the green box in
Figure 2.
5. Who dares wins. Planning
The relationship among the level of effectiveness applied to planning and execution
and the results generally expected.
Upon further review, however, it
often becomes clear a causal relation-
ship between planning and execution
processes and results is all but nonexis-
tent. Essentially, those positive results
occur by chance or pure luck. This can
be a dangerous situation for organiza-
tions to be in and is even worse when
they fail to recognize they’re in it.
5. Who dares, wins. This approach
occurs when planning and execution
are effective and are derived from a
thoughtful, directed effort. In this case,
results follow and business objectives
are achieved. Organizations choosing
this approach come out ahead over the
long haul.
At this point, most of the team mem-
+ Execution = Results
bers were buying into the idea that effec-
tive planning and execution were required
to generate intended results. A few team
members were even beginning to ask de-
tailed questions regarding how project se-
lection fit into this process.
Creating line of sight
Fortunately, I never go anywhere
without Figure 3, (p. 54) which depicts
the complete flow of top-level planning
through process execution, culminating in
customer and shareholder value. Several
important aspects should be evident in
Figure 3, including:
• While the flow from strategy to process
is straight, planning must be system-
atically decomposed into manageable

June 2010 • QP 53
 3.4 Per million
The driving force / Figure 3
Planning
External
(customer or
regulatory)
requirements
Business Business
objectives strategy
A clear line of sight exists from strategy through process.
elements (for example, tactical and
operational planning) to create visibility
and subsequent alignment to processes.
Often, tactical and operational planning
is abbreviated or completely forgotten
by organizations. When these detailed
plans are created, however, such
alignment can be achieved. Meaningful
projects can be identified, selected and
prioritized for execution. Furthermore,
this alignment between strategy and
process creates a driving force for busi-
ness success.
• Processes are executed. While this is
self evident to quality and LSS profes-
sionals, often it is not apparent to other
disciplines and professionals. When
processes are executed, work is ac-
complished and results are achieved.
When processes are improved, better
results are achieved. And, as we know,
LSS projects drive improvement at the
individual process level.
• The categorization of the processes
depends on the specifics of the organi-
54 QP • www.qualityprogress.com
Execution
Operational
processes
Support
processes
Tactical Operational People,
planning planning processes
Supplier
processes
Customer
processes
zation, though those provided in Figure
3 are common. In fact, the suggested
categorization may be beneficial in
helping prioritize selected projects, as
stakeholders of the processes are some-
what evident.
After discussing Figure 3 in depth, I sur-
veyed the team again. This time, the blank,
lifeless stares were gone, replaced with
looks of agreement and comprehension.
They had finally seen how planning, execu-
tion and processes connect to projects.
Remember the strategic plan
LSS project identification and selection
requires significant thought and time in-
vestment if it is to advance an organization
toward its business objectives.
The organization’s strategic plan, which
supports its business objectives, must be
dusted off and disseminated so it can serve
as the foundation for more detailed levels
of planning—in this case, tactical and
operational planning.
Tactical and operational planning helps
Results
Customer Shareholder
value value
create visibility and subsequent alignment
to processes. After this visibility and align-
ment is created, LSS projects can be more
easily identified, selected and prioritized.
Projects can then be executed to drive
process improvement, which further en-
hances customer value and, consequently,
shareholder value or return.
One last thing worth mentioning: The
project identification and selection team
members reported directly to the CEO. QP
BIBLIOGRAPHY
Blazey, Mark L., Insights to Performance Excellence 2009-
2010: An Inside Look at the 2009-2010 Baldrige Award
Criteria, ASQ Quality Press, 2009.
Kubiak, T. M. and Donald W. Benbow, The Certified Six Sigma
Black Belt Handbook, ASQ Quality Press, 2009.
Reidenbach, R. Eric and Reginald W. Goeke, “Six Sigma, Value
and Competitive Strategy,” Quality Progress, July 2007, pp.
45-49.
T.M. (TOM) KUBIAK is president and
founder of Performance Improvement
Solutions, an independent consulting
organization in Weddington, NC. He is
co-author of The Certified Six Sigma
Black Belt Handbook. Kubiak, a senior
member of ASQ, serves on many ASQ
boards and committees, and is a past
chair of ASQ’s Publication Management Board.
Career Corner
School of Hard Knocks
Applying lessons learned from promoting risk management
the first thing that came to mind as I
was thinking about this column was that I’d
share my experiences in launching a new
product and some of the hard lessons I’ve
learned on pitching—almost daily—proj-
ects and solutions to customers.
As you’ve probably gathered from
reading my recent columns, I’m concerned
about the future of the quality profession.
If I had to distill it, the prevailing quality
query has been: “Everyone is responsible
for quality, and if everyone’s responsible
for the quality of their work, what’s the role
of today’s and tomorrow’s quality profes-
sional?”
Risk management is critical
to the livelihood and advancement
of today’s professional.
It’s a tough question with no easy
answer. My crystal ball shows some form
of risk management becoming the core of
quality management, and with that comes
good news and bad news.
First, the bad. I’ve been advocating
this theme for more than six years, and I
have often heard boos from many quality
naysayers. The good news is that during
the last six months, the evangelizing push
has become a pull. Quality professionals
are much more responsive and accepting
of risk management.
Here are some of the difficult lessons
I’ve learned from being a risk management
evangelist that can be applied to any career
or job.
Develop a unique value proposi-
tion. My firm’s is: “Risk management is the
BY greg hutchins
future of quality. Period.” It’s simple, clear
and direct. It says risk management is criti-
cal to the livelihood and career advance-
ment of today’s professional. What’s your
unique value proposition?
Love your cause. My colleagues and
I got into quality because we wanted our
clients to be more competitive through
continuous improvement. It was a great
mission that worked for many years. Now,
our cause and mission is enterprise risk
management. Our clients want to capitalize
on upside risk and mitigate downside risk.
This is where we think you should go to
add value and kickstart your career.
Accentuate the positive. I pitch risk
management daily, and my mission is to
create a cause and generate energy around
the subject. Often, I’m tired of saying the
same things over and over again. At the end
of the day, I can hear fatigue in my voice or,
even worse, in the reaction—or lack of re-
action—from potential supporters. I realize
I need to maintain my enthusiasm. People
don’t respond well to negativity. They want
to hire and retain positive employees and
consultants.
See problems from the employer’s
side. Work is getting tougher for all of
us, but look at the challenges from the
employer’s point of view: margins are razor
thin, sales are flat, costs continue to rise,
and employers are passing the pain to
employees.
Is it fair for us? No, but we’re still
seeing the effects. Promotions and salary
increases aren’t as prevalent, and some
employers are asking for furloughs or give-
backs in salary, perks or benefits.
It’s tough out there for all employers
and employees, so before you say anything
about your boss or employer, take a mo-
ment and see it through his or her eyes.
Be overly courteous and thankful. If
you have decent-paying job, be thankful. If
you’re looking for a job, be overly courte-
ous and thankful. As an employer, we look
for folks who are courteous and have char-
acter. Unfortunately, there are still folks
who react to the market like it is time to
party, as was the case five years ago. This
attitude is especially toxic in these times
and will kill career and job opportunities.
Focus on your boss’s needs or your
client’s expectations. Your boss or client
has never seen or experienced this type of
economic downturn. He or she is wonder-
ing what to do and is looking to employees
for support and to consultants for solu-
tions. If you can’t give it to your boss or
client, they don’t need you and someone
else will fill your spot.
These are just some of the difficult
lessons I’ve learned. Being optimistic and
accentuating the positive may be the tough-
est thing to do in today’s economic climate.
People don’t want grumps—having a good,
even great, attitude may be one of the most
important things a person needs to survive,
prosper and excel in today’s workplace. QP
GREG HUTCHINS is the principal engi-
neer with Quality Plus Engineering, a
critical infrastructure protection firm
headquartered in Portland, OR. He is
a member of ASQ.
June 2010 • QP 55
 Quality in the First Person
Seek and You Shall Find
Quality manager uses web to net training for his employer
in march 2009, I joined a small com-
puter numerical control (CNC) job shop’s
management team as quality manager.
I started there after working in quality
management for 11 years, gaining experi-
ence developing new projects, launch-
ing new programs and participating in
automotive advanced product quality
planning program management.
At the job shop, I spent my early days
observing and learning who was who. I
also spent time evaluating how well the
ISO 9001 standard was being met and,
subsequently, identifying gaps that could
be filled quickly and others that needed
long-term attention.
In those early days, I could not find
any training records and started asking
other managers what training had taken
place and who had the records. You
might say my questions were met with
silence and slight smiles.
Have you ever volunteered for an
initiative and then wondered what your
total responsibilities would include?
After volunteering, I learned that 100%
56 QP • www.qualityprogress.com
BY gary knapp
of the ISO 9001 training and quality man- was getting people released from work
agement system (QMS)-related training tasks for training and specifically fitting
responsibilities fell on me; HR and other the QMS training to them.
department managers didn’t have an To figure it out, I spent break time
obligation. and lunch time searching the internet. I
The power of the search
is yours to control.
There were zero records and zero used Google and typed in keywords ap-
training initiatives for the past four years, plicable to the plant and industry. Doing
and on top of this, the next ISO 9001 it this way saved time and resources.
third-party audit was scheduled to occur The power of the search is yours to
within four months. control—you can start with keywords
and then search further by clicking on
Filling in the gaps “similar” after the search result appears
A big part of a fully functioning QMS in the header.
includes training, comprehension and I searched keywords that included
effectiveness verification. All training “CNC,” “manufacturing” and “training”
should be documented, even if using a and found an article written for a tooling
simple Word table or Excel spreadsheet. magazine within the past year. The article
I knew I could not recreate history, featured a Wisconsin-based CNC plant
so one of my first action items as qual- similar to ours that obtained state fund-
ity manager was to ing to support and help subsidize lean
develop a realistic training for all employees.
training plan that The article was well written and told
included the major- a good story. Better yet, the article gave
ity of the plant and me some ideas and solutions to use in
covered the next year. developing a long-term plantwide training
The plan I developed plan.
documented training I searched the internet again, spe-
using existing training cifically for “Illinois” (my state),” “lean,”
forms and recording “training” and “funding” and found
methods. information and contacts for the Illinois
Training the quality Manufacturing Extension Center (IMEC).
personnel who report- I identified a local contact, set up a
ed to me was easy. The program-review meeting and invited the
problem with plant- job shop’s HR manager and operations
wide training, however, manager.
Up and running
To make a long story short, within two
face-to-face IMEC meetings, an IMEC-
facilitated lean 101 course was planned
and implemented for completion before
the end of the year.
The IMEC program’s value-added
features included: an established pro-
gram ready to implement, a state-funded
program with funds available for applica-
tion, experienced trainers, and a proven
training plan and program with numerous
success stories.
The best sales feature—from manage-
ment’s perspective, anyway—was that
the state paid 50% of the training cost
through federal funds acquired specifi-
cally for this type of manufacturing devel-
opment in Illinois.
One basic need for a successful lean
program is baseline training across the
organization. Our training was successful
because it included plant operators and
set-up personnel, as well as engineers
and managers. Our next steps include:
• Establishing lean teams.
• Walking the plant seeking unused,
wasted and misplaced items.
• Implementing a 5S action plan with
frequent plant walks and audits.
• Getting people engaged and involved.
In the age of search engines and more
and more business systems transitioning
to electronic media, finding good bench-
marking information is easy. If you need
information, gap closure, ideas, recom-
mendations or any sort of help, start with
internet search engines to find what you
need. QP
Author’s Note
If your plant is located in Illinois, contact IMEC for training
and personnel development support. If you are located in
another state, search the internet and find your options.
Other search options include the National Institute of
Standards and Technology at www.nist.gov. From there, find
the Hollings Manufacturing Extension Partnership (MEP)
Inc. There you can learn more about MEP and its training,
including lean.

gary knapp is a quality manager at Faurecia in Dexter, MO.

share your story
Do you have an interesting story about how you used quality in your personal life
or how you came to work in quality? If so, e-mail your column for consideration
for a future issue of QP to editor@asq.org.
He earned his bachelor’s degree in political science and
economics from University of Maryland University College,
in College Park. Knapp is a senior member of ASQ and a
certified quality manager, mechanical inspector, quality
technician, quality auditor and quality engineer.

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June 2010 • QP 57
 Statistics Roundtable
Tried and True
Organizations put statistical engineering to the test, see results
A review of past Statistics Roundta-
ble columns reveals that statisticians and
quality professionals are always looking
for better ways to increase the breadth
and effectiveness of the use of statistical
thinking and methods.
In last month’s column, we introduced
statistical engineering as an approach that
links statistical thinking with statistical
methods and provides a mechanism for
improving the effectiveness of statistical
thinking and methods.1
Statistical engineering works because
statistical concepts, methods and tools
are linked and sequenced, based on sound
science and embedded in work processes
with the aid of software. Embedding—in-
cluding statistical methods in the standard
operating procedures for business pro-
cesses—is a powerful method of institu-
tionalizing the proper use of statistical
methods.
Statistical engineering is effective in
solving problems and improving pro-
cesses. What follows are several cases
illustrating how statistical engineering is
used and the breadth of its application.
Transactional processes
The first example of statistical engineering
is improving the performance of a trans-
actional process: the process of collecting
money from those who are past due on
their accounts.
Statistical thinking and methods, as
well as proper use of data, can be imbed-
ded into the operation of the process to
improve performance and to institution-
alize this improved approach. Table 1 illus-
trates some simple ways statistical think-
ing and methods can be imbedded in such
58 QP • www.qualityprogress.com
BY Roger W. Hoerl
and Ronald D. Snee
a process. The statistical tools involved
include process maps, run charts, control
charts, Pareto charts, measurement sys-
tem analysis using attribute measurement
studies, and design of experiments (DoE).
Perhaps the only method requiring
some explanation is the use of DoE to
improve collection strategies. In fact, DoE
has many potential applications in the
service industries.2 This first example is
based on actual DoE applications in col-
lections at General Electric (GE).3
In this case, GE’s credit card division
had many collectors attempting to find
customers who owed money on their
cards, but they could not be found at the
address or phone numbers on record.
Many of these customers were willing to
pay, but GE had no way of getting them
their bills.
Unfortunately, each collector had his
or her own process, usually involving
multiple external data sources, such as
external credit agencies, public records or
other GE credit-card files.
By applying DoE to identify the most
effective collection strategy, GE was able
to standardize the approach taken by col-
lectors, resulting in additional collections
of almost $3 million per year.
At GE, the contribution of statistical
engineering was to identify how methods
effective in one application arena could
also be applied in a new arena—collec-
tions—and also to ensure the ongoing ap-
plication of these methods by embedding
them into standard work processes.
Managing product quality
Another tangible example of statistical
engineering in the field of quality improve-
ment is the Product Quality Management
System (PQM) developed at DuPont in
the 1970s. PQM is an overall framework
for managing the quality of a product or
service. It provides an operational system
that enables marketing, R&D, production
and support personnel to work together
to meet increasingly stringent customer
requirements.
In his 1986 American Statistical As-
sociation Invited Presidential Address, Du-
Pont CEO Richard E. Heckert commented:
“Within two years, product quality had
improved to the point of commanding a
marketplace advantage, and more than
$30 million had been gained in operating
cost improvements. The statistically based
PQM system developed for ‘Dacron’ [a
polyester fiber] was expanded to other
products with further contributions in
earnings.”4
The statistical tools embedded in the
PQM approach included:
• Product and process sampling
schemes.
• Product lot release methods.
• Analysis of variance and variance com-
ponents.
• Cumulative sum control chart process
control.
• Shewhart control.
• Interlaboratory studies of measurement
methods.
• DoE.
• Response surface method.
• Data graphics.
A training system was also in place
to provide DuPont staff with the needed
knowledge and skills to use PQM.
Managing product quality was empha-
sized the tools were not. This was evident
in the role definitions of PQM statisticians
and quality professionals found in DuPont’s
PQM manual in 1988:
• Leaders in developing their organiza-
tion’s strategy for quality management.
• Leaders in developing technology sys-
tems for quality management.
• Participants in the business planning
process.
• Participants in problem-solving activi-
ties.
• Leaders in initiating and implementing
quality management training systems.
This manual, which goes back more
than 20 years, indicates that the roles of
statisticians and quality professionals
are different when embedding statistical
thinking and methods in the processes
used to operate the business. Leader-
ship is required by those using statistical
engineering. This example illustrates
the leadership role needed to implement
statistical engineering by connecting sta-
tistical tools with statistical thinking. This
was illustrated in Figure 1 in last month’s
Statistics Roundtable column. 5
The contribution of statistical engineer-
ing in this example was to integrate vari-
ous techniques (statistical and otherwise),
software, a training system, a manual
and new roles for statisticians and qual-
ity professionals into an overall quality
management system to improve quality at
lower costs.
In essence, the whole was greater
than the sum of the parts. This difference
was the unique contribution of statistical
engineering.
Streamlining experimentation
Another example involves streamlining
experimentation. This application of
statistical engineering was developed at
DuPont in the 1960s and was offered in
public workshops beginning in the 1970s.6
The strategy identifies three experi-
mental environments: screening, charac-
terization and optimization. The strategy
Statistical engineering to improve
a collections process / Table 1
Methods
Incorporate flowcharts into
training materials.
Define and monitor critical process
measurements using run charts
and control charts.
Create monthly Pareto charts of the causes
of defaulted accounts.
Develop formal procedures for analysis
of discrete measurements prior to
implementing Pareto charts.
Develop formal procedures for applying
designed experiments to improve
collection strategies.
sequences and links a variety of experi-
mental designs that are used depending on
the experimental environment.
The screening phase explores the
effects of a large number of variables
with the objective of identifying a smaller
number of variables to study further in
characterization or optimization experi-
ments. Screening studies typically use
fractional-factorial and Plackett-Burman
designs to collect data. Additional screen-
ing experiments involving additional
factors may be needed when results of
the initial screening experiments aren’t
promising. On several occasions, we’ve
seen the screening experiment solve the
problem.
In the characterization phase, we try to
better understand the system by estimat-
ing interactions and linear (main) effects.
Here, full-factorial and fractional-factorial
designs are used.
In the optimization phase, we develop
a predictive model for the system to find
useful operating conditions through re-
sponse surface contour plots and perhaps
mathematical optimization. Response
surface designs are used to collect data in
these studies.
Purpose
Document and communicate collections
process purpose and critical steps in
process operations.
Define objective work standards; properly
interpret process performance over time.
Quantify root causes of major
ongoing issues.
Ensure causes of defaulted accounts
can be accurately measured; document
measurement uncertainty.
Use scientific approach to ensure all
collectors are using the best-known
approaches.
This screening, characterization and
optimization (SCO) strategy actually
embodies several substrategies that are a
subset of the overall SCO strategy, namely:
• Screening-characterization-optimiza-
tion.
• Screening-optimization.
• Characterization-optimization.
• Screening-characterization.
• Screening.
• Characterization.
• Optimization.
The end result of each of these
sequences is a completed project. There
is no guarantee of success in a given
instance, only that SCO strategy will
increase your chances of succeeding.
The strategy used depends on the ex-
perimental environment. These charac-
teristics involve program objectives, the
nature of the factors (Xs) and responses
(Ys), resources available, quality of the
information to be developed and the
theory available to guide the experiment
design and analysis. A careful diagnosis
of the experimental environment along
these lines can have a major effect on
the success of the experimental pro-
gram.7
June 2010 • QP 59
 STATISTICS ROUNDTABLE
Statistical engineering contributes by
taking proven DoE techniques, which are
often researched and taught in isolation
from one another, and integrating them
into an overall experimentation strategy.
This strategy allows practitioners to
achieve greater results than they could
achieve using the same DoE techniques in
isolation.
Improving sales and operations
James L. Hess, vice president of operations
services at Leggett and Platt, described
another use of statistical engineering that
helped the the company improve its sales
and operational planning process, which
of course is a critical business process.8
This example involved embedding
statistical modeling and forecasting
methods within the demand planning part
of the process. Using data and applying
proven statistical methods are integral
to the business process, as is the com-
mercial software used to support the
workflows.
The statistical tools used included
Bayesian time series techniques for
modeling data. These techniques were
tailored to the application.
For example, if adequate data were
available, seasonality was incorporated
into the models. Rather than relying solely
on statistical methods, the models were
constructed and used to make forecasts
that can be revised based on outside
information, integrating statistical and
knowledge-based approaches.
The main benefits came from reduced
inventories for the same customer service
level and production efficiency. This freed
cash and reduced expenses associated
with carrying inventory. One of the most
significant benefits was the reduced op-
portunity for slow-moving and obsolete
inventory.
A smaller part of the business case
is improved labor efficiency. While the
financial impact of this approach is com-
60 QP • www.qualityprogress.com
pany confidential, Hess reported that this
business process approach contributed
significantly to the company’s bottom
line.
In this case, the contribution of sta-
tistical engineering was embedding the
methods to ensure institutionalization,
integration of statistical and knowledge-
based approaches, and tailoring the
Bayesian time series approach so it could
differentiate between cases with enough
data for seasonality estimation and cases
that didn’t have enough data.
Underlying theory
The reasons for the effectiveness of
statistical engineering can be seen when
you consider the theory underlying its use.
We believe there are at least five aspects of
this theory:
1. A system or strategy to guide the use of
statistical tools is needed to effectively
use the tools.
2. The impact of statistical thinking and
methods can be increased by integrat-
ing several statistical tools, enabling
practitioners to deal with highly com-
plex issues that cannot be addressed
with any one method.
3. Linking and sequencing the use of
statistical tools speeds the learning of
the approach, thereby increasing the
impact of the method.
4. Embedding statistical thinking and
tools into daily work institutionalizes
their application.
5. Viewing statistical thinking and meth-
ods from an engineering context pro-
vides a clear focus on problem solving
to the benefit of humankind.
Over time, as statistical engineering is
used, this theory will be challenged and
revised as more is discovered. As a result,
the breadth, depth and effectiveness of sta-
tistical thinking and methods in practice
will increase—an objective on which the
vast majority of statisticians and quality
professionals can agree.
Realizing the promise
Statistical engineering provides a thought
process that enables you to integrate,
link and sequence statistical tools in a
way that facilitates embedding the tools
in processes and systems used to run the
business. As a result, the sustainability of
the benefits on the problem solution or
process improvement is increased.
Broad use of statistical engineering will
move us closer to realizing the promise of
statistical thinking and methods. Leader-
ship by statisticians and quality profes-
sionals is required to effectively apply
statistical engineering. Assuming leader-
ship will result in impactful roles for those
who accept the challenge. QP
REFERENCES
1. Roger W. Hoerl and Ronald D. Snee, “Closing the Gap,” Qual-
ity Progress, May 2010, pp. 52-53.
2. J. Ledolter and A.J. Swersey, Testing 1-2-3: Experimental De-
sign With Applications in Marketing and Sales Operations,
Stanford Business Books, 2007.
3. Gerald J. Hahn, Necip Doganaksoy and Roger W. Hoerl,
“The Evolution of Six Sigma,” Quality Engineering, Vol. 12,
No. 3, 2000, pp. 317-326.
4. Richard E. Heckert, “Presidential Invited Address,” Ameri-
can Statistical Association Annual Meeting, Chicago, 1986.
5. Hoerl and Snee, “Closing the Gap,” see reference 1.
6. Ronald D. Snee, “Raising Your Batting Average,” Quality
Progress, December 2009, pp. 64-68.
7. Ibid.
8. Author communication with James L. Hess, 2009.
BIBLIOGRAPHY
Roger W. Hoerl and Ronald D. Snee, “Moving the Statistics
Profession Forward to the Next Level,” The American
Statistician, February 2010, pp. 10-14.
© 2010 Roger W. Hoerl and Ronald D. Snee
ROGER W. HOERL is manager of GE
Global Research’s applied statistics
lab. He has a doctorate in applied
statistics from the University of
Delaware in Newark. He is an ASQ
fellow and a recipient of the ASQ
Shewhart Medal and Brumbaugh
Award. Hoerl is also an Academi-
cian in the International Academy for Quality.
RONALD D. SNEE is president of
Snee Associates LLC in Newark,
DE. He has a doctorate in applied
and mathematical statistics from
Rutgers University in New Bruns-
wick, NJ. Snee has received the ASQ
Shewhart and Grant medals, and is
an ASQ fellow and an Academician
in the International Academy for Quality.
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64 QP • www.qualityprogress.com
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June 2010 • QP 67
 Standards Outlook BY J.P. Russell

Better Together
An audit is meaningless without effective follow-up
Conducting an audit correctly is
important because if it’s done wrong, the
results may not be credible. But even if
everything was done appropriately, follow-
ing up on the findings is just as important
because it gives meaning to the audit.
The two actions—the audit and the
follow-up—must go together for an audit
program to be effective. While the audit
gathers information about the existing
process or system, the follow-up audit
gathers data about auditee (or process
owner) actions to fix problems found dur-
ing the audit.

Consistent conclusions
In a process or system audit, there are
findings and an audit conclusion that
should be consistent with the findings.
Findings may include conformity and
nonconformity statements, opportuni-
ties for improvement and systemic issues
regarding the effectiveness and efficiency
of the management system. Conclusions
may require maintaining the status quo,
adjusting the amount of oversight or rec-
ommending awards such as a certification
or license to operate.
Findings of conformity may require
no follow-up. Conformity indicates the
system operates according to the require-
ments and is effective. This gives manage-
ment confidence the organization goals
and objectives will be achieved.
If there are nonconformities, the audi-
tee is responsible for taking action. A non-
conformity (noncompliance) may result in
the auditee taking remedial or corrective
action. The audit should be followed up
to verify the agreed-on corrective actions
were taken.
It is the responsibility of the auditee to
keep management informed of the status
of actions taken. Corrective actions can be
followed up as a separate audit or as part
of a subsequent regularly scheduled audit.
Timing to address nonconformities may
depend on the importance or urgency of
implementing a solution. The follow-up
may be conducted by a member of the
audit team or other person assigned by
management.
If an audit is conducted on a prospec-
tive supplier to determine its capability to
meet customer requirements, following
up on actions to address nonconformities
may not be necessary.
If remedial actions were taken, it may
be appropriate to stop or discontinue
them at an agreed-on time. Some reme-
dial actions—such as sorting, containing,
selecting and extra checking—increase
costs and should be stopped when the cor-
rective action is implemented. If remedial
actions become part of the solution, the
extra costs should be justified.
Making the correction
In many cases, nonconformities and
findings are systemic and require cor-
rective action to eliminate the cause of
the nonconformity, defect or undesirable
situation.
Eliminating the cause will ensure the
problem does not recur as a result of
the same cause. It’s necessary to verify
that corrective actions are effectively
implemented and reviewed to ensure the
action taken was suitable, adequate and
effective.
Use the following checklist to verify
implementation of the corrective action:
• Are people aware of the change and the
reason behind it?

68 QP • www.qualityprogress.com
Not addressing opportunities for improvement
is minimal thinking rather than maximum thinking.
• Was there training?
• Were documents changed?
• Were responsibilities defined?
• If affected, was the customer notified?
• Is the change being followed consis-
tently?
We want the corrective action to fix the
problem. This is where the audit program
pays back the organization. The person
reviewing the implemented corrective ac-
tion must verify the cause was eliminated
by ensuring the output process goals and
objectives have been achieved.
The request for corrective action
should be assigned to the process owner
or a team to determine the root cause
and actions to eliminate the cause of the
problem. The approved corrective action
plan should include measures to deter-
mine whether the corrective action was
effective.
The measures should include output
or deliverables of the process, as well
as process capability (effectiveness and
efficiency). The person reviewing the cor-
rective action should use the measures to
determine whether the corrective action
was effective. Quantifiable measures must
be used to determine effectiveness.
Output measures may include product
characteristics, delivery of a service, prod-
uct use, service deliverables and customer
feedback in the form of complaints or
surveys. Process measures may include
monitoring efficiency (cost), consistency
and variation.
The output of a process may include
product and service deliverables, such as
treatment, product or venue rental, plan-
ning, delivery of a product, application of
expert knowledge and benefit plans. It’s
important to look at the product and the
process because a solution to eliminate
causes of a problem should not come at
the expense of process effectiveness and
efficiency.
To verify the effectiveness of the cor-
rective action, use this checklist:
• Were output measures defined and
achieved?
• Were process measures defined and
achieved?
• Are processes capable?
• Are there records?
Don’t let it happen again
Depending on the purpose of the audit,
opportunities for improvement—including
potential nonconformities, problems or
undesirable situations—may be observed
and reported. Preventive action eliminates
the cause of the potential nonconformity,
problem or undesirable situation.
Preventive action is proactive, and
corrective action is reactive. The person
checking preventive actions should follow
a path similar to the one for checking cor-
rective actions.
Many organizations do not require
improvement opportunities be addressed
by the auditee (process owner). Because it
is not a nonconformity (noncompliance),
management has the option of addressing
it or not. But why not require improve-
ment opportunities be addressed? Not
addressing opportunities for improvement
is minimal thinking rather than maximum
thinking.
If a person conducting an audit or
observing a process thinks there is an
opportunity to improve it, why not follow
up? It is interesting that organizations de-
velop programs to nurture feedback from
employees but dismiss improvement op-
portunities from an audit because it is not
required to be compliant with a standard.
It’s about time
Timing is everything. This is true when it
comes to checking corrective actions. If
you are auditing a management system
for the first time and find the procedures
have only recently been issued, what can
you conclude based on your assessment?
Do you have confidence the procedures
are effective? Corrective and preven-
tive actions should be implemented and
reviewed at agreed-on times.
Timing the review of corrective or
preventive actions after implementation
will vary, depending on the nature of
the actions, industry and organization
culture. I would start with a minimum of
three months for the initial review of the
actions taken. The final review could be
scheduled for 12 months from the initial
implementation.
Why perform a second review? Be-
cause you must ensure the actions taken
are sustained. You want to ensure the
actions taken are fully integrated into the
management system. It may seem like
extra work, but after you truly eliminate
causes of problems and potential prob-
lems, resources are freed to advance and
improve the organization.
You may want to follow the same steps
to review innovative actions taken to
change a process or system to better meet
organization objectives.1 For example,
innovative actions may address objectives
to control costs, improve safety, lower risk
or improve customer satisfaction.
After the final review is complete,
close out the corrective or preventive
action request and celebrate the team’s
June 2010 • QP 69
 Standards Outlook

success and the benefits realized for the
organization. It is time for interviews,
news releases and awards. Perhaps an
annual meeting would be a good time to
recognize contributions.
Uh-oh
Occasionally, the cause of the problem or
undesirable situation is not eliminated.
This shouldn’t happen, but it does.
Either the approved corrective or pre-
ventive action plan did not eliminate all
the causes, or it didn’t eliminate the right
cause. If the corrective action is not effec-
tive, it needs to be recycled. If you recycle
several corrective actions each year, you
should revalidate the corrective action
and problem-solving processes.
As an auditor, I have reviewed ap-
proved corrective actions that were
nothing more than remedial action. The
so-called corrective action may appear to
be effective because the measurements
are wrong. What should an auditor do? Is
the auditor there to verify that the planned
Follow me
Have you seen an audit fall apart because of a lack of follow-up? Post your story
on the QP discussion board at www.asq.org/discussionBoards (case sensitive), or
e-mail it to editor@asq.org.
corrective actions were implemented? Or
should the auditor report that the correc-
tive action plan was wrong from the very
beginning?
On one hand, ISO 19011 and the ASQ
certified quality auditor body of knowl-
edge emphasize the importance of auditor
competency. A competent auditor should
report his or her assessment of the situa-
tion and request that the corrective action
be recycled.
On the other hand, if an auditor (or
other person assigned follow-up responsi-
bilities) questions the creditability of the
corrective action, the auditee (process
owner) may become defensive. In re-
sponse, management of the auditing orga-
nization (or department that approved the
corrective action plan) may also become
defensive.
In the midst of this back and forth, the
auditor (or person assigned to follow-up)
feels like the target. If that individual
is assumed to be competent, his or her
judgment should stand without ques-
tion. At that point, there should be a
process to address this situation, such as
a higher-level review by people who are
free of bias.
Results come from checking, not ex-
pecting.2 All agreed-on action items must
be checked, which requires minimal time
and resources for well-managed organiza-
tions with a sharing and trusting culture.
Verification of corrective actions closes
the loop on actions to fix problems or
implementation of improvements. Closing
the loop ensures your organization ben-
efits from your audit program and other
assessment activities. QP
References
1. J.P. Russell, Continual Improvement Assessment Guide,
ASQ Quality Press, 2004, p. 38.
2. Ibid., p. 2.
J.P. Russell is president of J.P.
Russell & Associates in Gulf Breeze,
FL. He is also managing director of
and provides training for QualityWBT
Center for Education. Russell is an
ASQ fellow, ASQ-certified quality audi-
tor, voting member of the American
National Standards Institute/ASQ
Z1 committee and member of the U.S. technical advisory
group for International Organization for Standardization
technical committee 176. In 2008, Russell received the Paul
Gauthier ASQ Audit Division award. He is the editor of The
ASQ Auditing Handbook, third edition, and author of several
ASQ Quality Press books, including The Process Auditing and
Techniques Guide, second edition.

ShareYour
QualityJourney
Each month, QP includes an interesting, personal quality story in its “Quality in the

First Person” column. If you are interested in sharing your story—how you got into

the quality field, how it has helped your organization or your career or how quality

has enhanced your personal life—e-mail editor@asq.org.

70 QP • www.qualityprogress.com
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 QPToolbox
Epoxy resin
Impco’s Imseal-800 seals visible poros-
ity in castings and other metal parts. It
permanently fills blowholes, cracks and
other defects in situations where welding
or brazing would be impractical. The clear
sealant is ideal for laminating, potting
and encapsulating. The sealed area is
pressure-tight and can be drilled, tapped,
machined and processed.
Imseal-800 comes in a premeasured
packet. The epoxy and activator are
mixed before the packet is opened, and
the packaging itself can be used as the
applicator. It cures at room temperature
or can be accelerated by heat. It has
a Rockwell hardness of 97, a tensile
strength of 9,000 psi, a compressive
strength of 35,000 psi and a compressive
yield of 16,500 psi.
• Call: 401-521-2490.
• Visit: www.impco-inc.com.
Inspection probes operate in any orientation.
Renishaw’s RLP40 and OLP40 inspection A wide range of shanks is available,
probes offer a choice of signal transmission including parallel and tapered designs, for
technologies—radio or optical. Measuring flexibility when mounting the probes in a
40 x 58.3 mm, the probes provide unidirec- lathe or turning center turret.
tional repeatability of 1µm. Both designs • Call: 847-286-9953.
are hardened and sealed to withstand • Visit: www.renishaw.com.
extreme environments typical of lathes
and turning centers. An eyelid protection Self-regulating heating cable
system prevents entry of chips that could EasyHeat has introduced SR Trace, a self-
damage the probe’s internal parts. regulating heating cable that varies its heat
The RLP40 probe and its interface con- output with changes in the surrounding
tinually hop from one transmission channel temperature. Because of the self-regulating
to another, delivering signal robustness feature, it can be safely wrapped over itself
and flexibility through frequency switching. when installed on pipes, valves or flanges.
Radio transmission allows communication SR Trace cables provide freeze protec-
between the probe and the interface, even tion for plastic or metal pipes and vessels
when line of sight is lost. The OLP40 uses at temperatures as low as -40º F. The
modulated optical transmission for high cables will also maintain liquids in pipes at
resistance to light interference, and its 360° a constant temperature to prevent degra-
transmission system allows the probe to dation of the liquid or to preserve required

72 QP • www.qualityprogress.com
viscosity for flow conditions.
SR Trace cables feature tinned copper
bus wires, a copper ground braid, a flame-
retardant thermoplastic elastomer jacket
and a modified polyolefin over jacket. They
are available in power densities of 3, 5 and
8 watts per foot at 50º F.
• Call: 800-537-4732.
• Visit: www.easyheat.com.
Magnifying lamp
The Daylight Co. has released the ESD
Ultra Slim Magnifying Lamp, which pro-
vides protection against static electricity
and electrostatic discharge (ESD). The
lamp features 28 W efficiency with the
combined power of a 7 in.-wide glass
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The entire lamp is fully grounded and
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static charges and prevent buildup of
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turers, testing agencies, repair facilities
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environments that are prone to ESD.
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Mini parallel gripper
Techno-Sommer Automatic has ex-
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grippers are designed for use in smaller
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assembly and multiple pick-and-place
applications. They are available in eight
different sizes.
The MGP800 series uses a hardened
steel flat guide to ensure maximum
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grippers have up to 400 N grip force
and a range of 1-12 mm stroke per
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Internal and external
connectors Depending on the model, TwistMate
FasTest TwistMate internal and exter- connectors are rated for pressures up to
nal connectors feature stainless steel 10,000 psi. The broad standard offering
construction for durability and corro- includes sizes from 1/8 to 3 in. national
sion resistance. TwistMate connectors pipe taper.
provide a seal that is a leak-tight connec- • Call: 800-444-2373.
tion to threaded pipe without the use of • Visit: www.fastestinc.com.
wrenches and thread sealants. They are
ideal for a range of applications, includ-
ing filling, flushing, plugging, calibrating
and venting.
TwistMate connectors are twisted
onto the mating thread profile by hand.
When the system is pressurized with air,
gas or hydraulic pressure, the main seal
is pressed against the test piece, and
the connector automatically seals. The
internal piston action maintains the seal
with minimum pressure.
Got a quality product?
Send your product description and photo to vellifson@asq.org.
June 2010 • QP 73
 QPReviews
Innovative Lean Development
Timothy Schipper and Mark Swets, CRC
Press, 2009, 200 pp., $39.95 (book).
This book is all
about applying
lean management
principles to the
product develop-
ment process.
The book’s eight
chapters describe
six principles of
lean development: identify and fill user
gaps, use multiple learning cycles, stabilize
the development process, capture knowl-
edge, use rapid prototyping and use lean
management principles.
The main strength of the book lies in
the two chapters devoted to using multiple
learning cycles. In this approach, teams
break a project into small sections lasting
approximately four weeks. Objectives are
developed specifically for this timeframe,
and then the team goes through a design-
build-test-review cycle for its section.
At the end of each four-week section,
an integration event is held in which the
project is reviewed and the set of design
alternatives is narrowed. The narrowing
of design alternatives is called set-based
design and is at the heart of lean develop-
ment.
These sections and cycles continue
until the project is finished and the product
is ready for manufacturing.
The authors give examples showing how
the principles are to be applied, but the ex-
amples are not detailed enough for anyone
interested in adopting this method to use
this book alone.
Overall, this is a good book for anyone
74 QP • www.qualityprogress.com
who wants an introduction to lean prod-
uct development. However, other sources
will be needed to proceed with imple-
mentation.
Brian Cocolicchio
New City, NY
The Pursuit of Something Better
Dave Esler and Myra Kruger, New Ridge
Books, 2009, 288 pp., $15.95 (second edi-
tion, book).
Kruger and Esler’s
book is a positive
account of U.S. Cel-
lular’s journey from
ordinary to extraor-
dinary. This book
is not a reference
manual, textbook
or a technical refer-
ence. It is a background resource exploring
how improvement is possible, how it deliv-
ers emotional returns and how it results
in quality enhancements for everyone
involved.
The authors review the action programs
within U.S. Cellular as the company’s team
developed strategies to enhance employee
satisfaction, implement activities for deliv-
ering results, spark innovation and improve
customer satisfaction. Kruger and Esler
illustrate the company’s successes, failures
and extensive employee involvement. The
book helps readers feel as though they
are a part of the action and, in turn, they
can take the ideas and apply them in other
settings.
This book will be of interest to organi-
zational leaders and decision makers at
all levels. Executive officers will gain in-
sights from the details on how goals were
accomplished, customer reactions and
strategies for continued improvement.
Readers will have an opportunity to think,
ponder and test ideas.
Even though quality is not a primary fo-
cus of the book, it does give insights that
can be applied to quality implementations
at other organizations.
Jerry Brong
Ellensburg, WA
Corporate Sustainability
Planning Assessment Guide
Donald C. Fisher, ASQ Quality Press, 2010,
272 pp., $80 list, $48 member (book and
CD-ROM).
Assessing organi-
zational sustain-
ability requires
integration of
economic, environ-
mental and social
issues. Corporate
sustainability plan-
ning builds on core
values and provides a roadmap that af-
fects employees, suppliers and customers.
As the title implies, this book is a how-to
manual consisting of nine chapters, eight
appendixes and a CD-ROM containing use-
ful material.
The guide provides templates and pro-
cedures for identifying strategic improve-
ment opportunities regarding sustainabil-
ity efforts. It can be used to develop and
improve a corporate sustainability plan
addressing financial objectives, marketing
goals, HR management challenges and
risk management.
 This how-to manual provides clear and
well-organized procedures, but implement-
ing them will require additional experience
or knowledge found in other articles and
books.
Ron S. Kenett
KPA
Raanana, Israel
Leadership Elements
Mike Mears, iUniverse, 2009, 364 pp.,
$25.95 (book).
This book offers
a unique look at
leadership and
management. Most
popular leader-
ship books contain
anecdotal nuggets
of wisdom from
football coaches,
ex-CEOs or business
school professors. Mears is none of these.
He is not only a leadership consultant and
lecturer, but he has also spent a lot of
time in the leadership seat as a company
president, a vice president and nuclear
submarine commander. When the CIA de-
cided to start its own leadership academy,
they called Mears.
His leadership and management ele-
ments are laid out like the periodic table
we all came to know in chemistry class.
Mears uses the periodic table as a frame-
work to identify and discuss individual
leadership and management competen-
cies. As in chemistry, individual elements
can be combined into fundamental
families. Mears combines his elements to
form the families of inspire, improve and
implement. The last section, rare earth ele- Recent Releases
ments, rounds out the book as a potpourri
of competencies not covered in previous
Facilitating Project Performance
sections.
Improvement
My personal bookshelf is replete with
Jerry Julian, Amacom, 2010, 224 pp., $29.95
scholarly works on leadership research
(book).
and assessment. Although I tend to scoff
at attempts to add anything useful to Production Systems Engineer-
applied leadership knowledge, I liked this ing: Cost and Performance
book. It provides a clear understanding and Optimization
method for thinking about and implement- Richard E. Gustavson, McGraw-Hill, 2010,
ing a strategy to improve organizational 256 pp., $125 (book).
performance.
This book will help readers become Out of Another @#&*% Crisis!
more effective leaders. If you apply even a Motivation Through Humiliation
couple of the elements, you can’t help but Mike Micklewright, ASQ Quality Press, 2010,
become a better leader and, perhaps, a 256 pp., $20 member, $34 list (book).
better person.
James Kotterman Creating a Lean Culture: Tools
Michigan Manufacturing to Sustain Lean Conversions
Technology Center David Mann, CRC Press, 2010, 316 pp.,
Plymouth, MI $39.95 (second edition, book).
Advertisers Index
Advertiser Page Phone Web
EtQ Inc. 1 516-293-0949 www.etq.com
Harrington Group 63 407-382-7005 www.harrington-group.com
InfinityQS International Inc. 57, 63 703-961-0200 www.infinityqs.com
Major Micro Systems Inc. 67 248-350-9177 www.majormicro.com
Minitab 2 814-238-3280 www.minitab.com
The National Graduate School 43 800-838-2580 www.ngs.edu
Quality America Inc. 65 800-722-6154 www.qualityamerica.com
Quality Council of Indiana 10, 11 812-533-4215 www.qualitycouncil.com
SigmaXL 65 888-744-6295 www.sigmaxl.com
Southern Polytechnic State University 57 678-478-2204 www.spsu.edu
StatPoint Technologies Inc. 67 540-428-0084 www.statgraphics.com
StatSoft Inc. OBC 918-749-1119 www.statsoft.com
June 2010 • QP 75
 QPcalendar
If you’d like your event included in QP Calen-
dar, submit information at least three months
in advance to vellifson@asq.org. Non-ASQ
organizations may list one event per issue.
july
7-8 An Introduction to Quality
Management. London. Visit the Chartered
Quality Institute at http://thecqi.org.
8-9 Certificate Issuers’ Accredita-
tion Workshop. Washington, D.C. Visit the
American National Standards Institute at
www.ansi.org.
asqCourseClusters
Offered by the Learning Institute
JULY
Canada—various locations
12 Supplier Auditing—Montreal
12-13 Supplier Auditing and Certifica-
tion—Montreal
13 Supplier Auditing—Ottawa
13 Supplier Certification—Montreal
13-14 Supplier Auditing and Certifica-
tion—Ottawa
14 Supplier Auditing—Toronto
14 Supplier Certification—Ottawa
14-15 Supplier Auditing and Certifica-
tion—Toronto
15 Supplier Auditing—Kitchener
15 Supplier Certification—Toronto
15-16 Supplier Auditing and Certifica-
tion—Kitchener
16 Supplier Certification—Kitchener
visit www.asq.org/
learninginstitute for
details.
76 QP • www.qualityprogress.com
12-13 Fundamentals of Strategic
Planning. San Francisco. Visit the Ameri-
can Management Association at www.
amanet.org or call 800-262-9699.
12-13 HACCP I: Prerequisite Pro-
grams. Guelph, Ontario. Call the Guelph
Technology Food Center at 519-821-1246
or visit www.gftc.ca.
12-16 Building and Implement-
ing Growth Strategies. Chicago. Call
the University of Chicago Booth School of
Business at 312-464-8732 or e-mail
exec.ed@chicagobooth.edu.
AUGUST
Baltimore
23-25 Internal Auditing to ISO/IEC 17025
23-25 ISO 9001:2008 Internal Auditor
Training (RABQSA)
23-25 Root Cause Analysis
23-27 Auditor/Lead Auditor Training for
ISO 13485
23-27 Black Belt/Quality Engineering
Statistics
23-27 Introduction to Quality Engineering
23-27 Introduction to Quality Management
23-27 ISO 22000:2005 Lead Auditor
Training
23-27 ISO 9001:2008 Internal Auditor
Training (RABQSA)
25-27 Design of Experiments
25-27 Practical Measurement Uncertainty 29-sept 2 Commercialization of
(AClass)
26-27 16-hour ISO 9001:2008 Lead
Auditor Training
13-14 Lean Certification Review
and Exam. Madison, WI. Call the Associa-
tion for Manufacturing Engineers at 224-
232-5980 or visit http://ame.org.
13-15 Automotive Refrigerant and
System Efficiency Symposium. Scotts-
dale, AZ. Visit the Society of Automobile
Engineers at www.sae.org.
13-16 SCOR Framework and SCOR
Project. Houston. Call the Supply Chain
Council at 202-962-0440 or e-mail info@
supply-chain.org.
14-15 The 6th Annual Midwest
Product Safety and Liability Confer-
ence. Chicago. Visit Randall Goodden
International at www.randallgoodden.com
or e-mail info@randallgoodden.com.
23 Medical Device Risk Management.
Seattle. Call Hobbs Engineering at 303-
465-5899 or visit www.hobbsengr.com.
August
20 ISO/TS 16949 Requirements—Full
Standard Review. Webinar. Visit Eagle
Food Registrations at www.
eaglefoodregistrations.com.
23-25 The 2nd Canadian Quality
Congress. Toronto. Visit the Canadian
Quality Congress at www.
canadianqualitycongress.com.
Micro-Nano Systems Conference. Santa
Ana Pueblo, NM. Visit the Society of Manu-
facturing Engineers at www.sme.org.
The Knowledge Center
www.asq.org/knowledge-center
Learn about quality. Apply it. Share it.

ASQ’s online Knowledge Center is the place to:

• Stay on top of the latest in quality with Editor’s Picks and Hot Topics.

• Search ASQ’s collection of articles, books, tools, training, and more.

• Connect with ASQ staff for personalized help hunting down the
knowledge you need, the networking opportunities that will keep
your career and organization moving forward, and the publishing
opportunities that are the best fit for you.

www.asq.org/knowledge-center.
 For information on placing an ad,

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78 QP • www.qualityprogress.com
 For information on placing an ad,

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Call for Six Sigma Forum Magazine is seeking articles

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articles
For information on the review process and
types of articles considered, along with
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June 2010 • QP 79
 One Good Idea
Taken to Task
Scale back quality implementation to get management on board
Many quality managers suffer
through daily confrontations with top
management and department heads who
aren’t committed to total quality manage-
ment (TQM).
As a result, these quality managers
think their processes are being side-
tracked and that they’re only in place
to satisfy contractual obligations. They
struggle to uphold a quality culture within
the organization and can lose their pas-
sion—or worse, their jobs.
But there’s an easy way to build quality
into the organization: by working inside
out—or, to put it another way, by applying
quality management principles at the task
level.
A task is a simple job assignment or
direct instruction from managers to team
members. By focusing on the task as a
miniature process that requires inputs and
produces outputs through a set of activi-
ties, task quality management can drive
organizational quality when top manage-
ment lacks commitment to TQM.
But there are a few things to keep in
mind when undertaking a project of this
nature:
Target: Less sophisticated manag-
ers relay tasks from their superiors in a
redundant fashion without putting much
effort in “processizing” the task to make
it a quality-oriented endeavor. In doing
so, they forget about the reason behind
the task and what will be accomplished.
Remember to identify the objectives of the
required task before getting under way.
Task-Oriented
Quality is applied to small projects every day, even if we don’t always realize it.
Share your experiences by logging on to the QP message board at www.asq.org/
discussionBoards/index.jspa (case sensitive).
80 QP • www.qualityprogress.com
BY Magid Youssef
Time: Most managers assign tasks with
their attention focused on the time spent
on the task. But, in some cases, they’re
not focused on the time as much as they
are on the output. Very few managers bal-
ance the requirements for individual tasks
while focusing on meeting tight deadlines.
If you want your project to be successful,
make sure you record the expected time
for completing the task.
Tools: Empowering your employees
is the key to building quality at the task
level. Being empowered means they have
the required knowledge, tools and skills to
achieve the desired results effectively and
efficiently.
Knowledge includes an understand-
ing of the contextual target the task aims
to fulfill, as well as a solid background
of technical information and reference
standards that assist decision making and
focus on the qualitative parameters of
the task performance. The tools required
for carrying out the task should facilitate
its completion within the predetermined
timeframe. Skills can only be acquired via
comprehensive training throughout the
process of completing the task.
Training: Very few managers take the
time to identify the training needed to
develop an employee’s skills and complete
the task at hand. When you identify the
training required for the task, include
future training needs.
Technical standards: Good document
control management requires keeping a
copy of the technical information and ref-
erence standards relevant to the assigned
task readily available and updated for easy
cross-reference. Unfortunately, it’s rarely
done in an effective way. When setting out
on a project, outline the applicable stan-
dards and keep updated copies on hand.
Tracking: Tasks undertaken by em-
ployees are generally not totally inde-
pendent of other related tasks. Thus, it’s
important to coordinate and integrate a
task’s inputs and outputs to ensure total
synchronization with related tasks. But
remember to place those actions under
the jurisdiction of employees carrying out
the assigned task. Otherwise, you run the
risk of leaving them unempowered, unmo-
tivated and, worst of all, uninformed.
Takeaway: Identify the format for the
submission of the results, and state the
deliverables. If the context is changed,
thereby requiring a different interpretation
or format for the task outputs or deliv-
erables, clarify the reason by explaining
the contextual history of the change and
correlating the subsequent task changes
required.
By taking quality to the task level,
you can optimize performance, improve
communication, empower employees
and avoid the oft-encountered conflicts
of adopting a full TQM initiative. These
smaller gains at the departmental level
can inspire top management to embrace—
and even champion—a quality culture
within the organization. QP
Magid Youssef is an architect
at Spiracle Design in Mississauga,
Ontario. He earned a bachelor’s de-
gree in architecture from Ain Shams
University in Cairo, Egypt. Youssef is a
member of ASQ and a certified quality
assurance manager.
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Priority Code MNJGF70

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