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K. A. POTOCKI AND R. C.

BROCATO

QUALITY MANAGEMENT

A System of Management for Organizational Improvement
Kenneth A. Potocki and Richard C. Brocato

F aced with cutbacks in funding, escalating costs, global competition for limited
resources, and a demand for higher-quality outcomes, organizations of all types have
felt the pressure to operate more effectively. Organizational improvement is required.
Based upon various management approaches, five guiding principles are being used to
make outstanding improvements in organizational performance: measurements/bench-
marking, leadership, employee involvement, process improvement, and customer focus.
However, not every organization trying to apply these principles is successful. What is
required for success is that these principles be understood and applied as an integrated
system of management.

INTRODUCTION
During the past decade, rapid worldwide technolog- these principles seem familiar and make good common
ical and sociopolitical changes have precipitated the sense, yet not every organization that has tried to apply
“globalization” of the economy where “. . . in every them has been successful.
industry and sector throughout the world, success, and The purpose of this article is to describe how this set
in some cases survival, will depend upon the ability of of five principles constitutes the components of a system
organizations to compete globally.”1 Fueled by this of management for organizational improvement. First,
change, organizations of all types, including business, the failure of improvement initiatives will be examined
government, education, health care, military, and re- to shed light on why quality improvement approaches
search and development, have been rethinking their are often unsuccessful. Next, systems concepts will be
operations and management approaches.2 Faced with reviewed in order to establish “appreciation for a sys-
many of the same demands, such as cutbacks in funding, tem.”2 Insights gained from the applications of systems
escalating costs, competition for limited resources, and thinking to this theory of organizational improvement
a demand for higher-quality outcomes, these organiza- will then be used to develop an understanding of how
tions have all felt the pressure to operate more effec- the individual components of the system reinforce each
tively. The old paradigms simply are not working other. Finally, the validity of this proposed system of
anymore.3 Transformation into a new style of manage- management will be examined through its different
ment is required.2 applications to organizational improvement.
When we examine the various management ap-
proaches that these organizations are taking toward
REASONS FOR FAILURE OF
managing improvement, we find five guiding principles
that are working to make outstanding gains: measure- IMPROVEMENT INITIATIVES
ments/benchmarking, leadership, employee involve- One of the key reasons cited for the failure of
ment, process improvement, and customer focus. All of quality improvement initiatives is that “many quality

402 JOHNS HOPKINS APL TECHNICAL DIGEST, VOLUME 16, NUMBER 4 (1995)

. striving for equilibrium (a state of balance provement program. Coopers & Lybrand. which is customer satisfaction. will be discarded. more involved employees. Three-function systems model. Many companies have fallen into this higher productivity and efficiency. and training. in Fig. in its present form. . It is a system of manage- thews and Katel. If these relationships of these common-sense principles. He also pointed out that “every company should strive for con. decision ously refined to reflect changes in the business environment and in customer needs. may not be able to The quality improvement approach is not a pro- claim the kinds of successes that would justify current gram or an organization intervention with a specific levels of investment. . quality improvement initiatives were “implemented in JOHNS HOPKINS APL TECHNICAL DIGEST. by 1990. . Little teracting elements [or components] designed to carry that found that out cooperatively a predetermined function. A SYSTEM OF MANAGEMENT FOR ORGANIZATIONAL IMPROVEMENT management plans are simply too amorphous to gen. align with its strategic direction. a partial manner” employing a confusing “set of tools erate better products and services .”4 Simply reading lots of books. continued losses forced or adjustment between opposing or divergent influenc- them to abandon it. 10. nization or to its improved performance. with justification for the enormous sums of money invested no visible connection to the real business of the orga- in [quality improvement initiatives]. they will fail to make they exhibit greater profitability.6 gies.9 These efforts tomer satisfaction and improved competitive posi. oil supplier. quality improvement initiatives should clearly define leadership and communicate a vision for organizational change. feedback). because they do not fully understand the concept or the A simple three-function model of a system is shown connection between improved quality and cost sav. MacFarland7 cited that “federal function and contribute to a specific aim—a service or managers are ambivalent about [quality improvement] product development. studies have shown that successful effect on determining what competitive advantage an organizations appreciate the importance of the inter- organization will have in the marketplace. principles. earnings and an inferior competitive position. In an organizational context this competitive].7 Blewitt8 reported that most quality improvement initiatives spend too much time focusing on the processes and mechanics of the improvement program instead of the end result.”12 This [A] slim 36 percent said the [quality improvement] process definition is intentionally broad to cover a wide range was having “a significant impact” on their ability to [be of different systems. When activities do not add value to an organization or do not they employ the principles as a system of management. 1. . little benefit was derived when the princi- sands of new practices simultaneously have little effect ples were segregated. the processing is done executives and managers conducted by the international consulting firm. lower costs. in their products and services. implies a multiplicity of people. a Houston-based so as to achieve a required response). Analysis Sensing and Response tinuous improvement . technolo- ment techniques cost more than they’re worth .” To work. . and forming lots of teams to implement thou. Planning Information Communication Technology Process ed that critical steps are being missed in the implemen. and materials that together perform a significant In another study. control tation of the quality improvement process. training lots of interrelationships of the five previously cited guiding people. .8 Input Processing Output Wilkinson’s research indicated that many failed Figure 1. and seeking optimization (a process of that winning the Malcolm Baldrige National Quality arranging or combining the efforts of all components Award did not help the Wallace Co. open to the environment. and end.10 on customer satisfaction. .6 Douglas Aircraft was troubled by poor ment: strategic in nature. beginning. Some companies complain that such manage. increased customer a meaningful contribution to the bottom line and they satisfaction.] the only and techniques. The input to this three-function system comes ings. [Yet. VOLUME 16.. failed because the organizations failed to realize the tion. Neither do such acts have an On the other hand. and superior quality “activity trap” in trying to implement quality improve.4 Several recent studies have suggested that quality SYSTEMS CONCEPTS improvement. NUMBER 4 (1995) 403 .5 According to a study by Mat. is increased cus. processes. stay profitable. They need to be continu. The study suggest.” improvement teams. In 1989 cyclical in operation (producing output and receiving the company implemented an extensive quality im. middle. Matthews and Katel also reported es or elements). And they cited a survey of By system. .11 ment initiatives.” She based her claim on a survey of 600 federal from sensing the environment. we mean “an integrated assembly of in- 500 companies conducted by Boston’s Arthur D.

Process im- provement works on the principle that Feed forward an environment in which everyone has the opportunity to continually and in- crementally improve the work of the Processes organization is the basis for an improv- Leadership ing organization. integrity. analysis and decision includes the leadership. and communica. system process that creates a spirit of cooperation with- tions necessary to tailor a specific response. pre- environment outside the system. Customer Measurements/ Employee Customer-focused focus centers on gaining a profound un- benchmarking involvement improvements derstanding of customer requirements and expectations and using that under- standing to provide a product or service far exceeding satisfaction. it may come from measurement to realize that vision. customer focus allows an improvement organization to respond to customer re- actions to the output of the system— Feedback products or services—and to identify im- Figure 2. The second element. is a system pro- a relationship of management principles develops. human resource development with strategic plans and ganizational improvement has five interrelated compo. empowering employees. ments. and the output constitutes the dition. sensing. the system of management for or. The fifth component in the system of management for organizational im- Input Output provement is customer focus.2 It requires the system will react. represents the output of the system. of customer or sponsor satisfaction about products and/ and objectives that “cascade down” each level of the or services or from benchmarking other organizations’ organization. employee The third component. system of management for organizational improvement. An organization’s success in improving In an organizational improvement context. It focuses on empowering the work- nents as shown in Fig. provements. This component identify gaps between the system’s current state. BROCATO by people using technology and methods to do analysis ning system changes or process improvements. POTOCKI AND R. The third in an organization and taps the creative contributions element. The cess that is strategic in nature. When used to assess system process involving the incremental elimination feedback. A system of management for organizational improvement. In ad- and make decisions. change processes. the fourth component. Leadership. considers processes inside the system that result communications. open sion. is a lead to better performance results. VOLUME 16. NUMBER 4 (1995) . allows an organization to objectively evaluate performance goals. response. 2.” The nization’s administrative and technical work processes results of the assessment can serve as an input for plan. goals. measurements/benchmarking can be used as a response of the system to the input. tech. The infrastructure “feed forward” mechanism to predict trends. the second component. When viewed Process as feedback. builds commitment to a common purpose. an output performance depends largely on the skills and motiva- could be customer-focused improvements in product or tion of its workforce. communication. of each member. that influence the customer’s perception of the quality of the product or service. It The first of these components. C. and trust. information. A. measurements/benchmarking can help to of all barriers to good performance. process improvements. Thus. K. measurements/bench.” and its desired future state. anticipate the needs of customers for new products or Extending this three-function model in Fig. employee involvement. 1 to a new services. whether changes are necessary and whether activities Process improvement. This concept encompasses 404 JOHNS HOPKINS APL TECHNICAL DIGEST. In an organizational improvement context. maintain an environment of information sharing. is a involvement. This input usually comes from the conception of an organizational vision—an ideal. This allows organizations to change course and nology. These elements from acting upon the information from outside the constitute a basis for reacting to customer inputs and system. This plan includes mission. “what deals with the efficiency and effectiveness of an orga- is. Employee involvement aligns performance. forecast to make the system work is contained in subsystems future environments. force and forming worker–manager partnerships. “what should be. In an organizational ferred future with a grand purpose—and a strategic plan improvement context. and anticipate needed improve- such as planning. and process control. provides the input to which the managed”. analysis and deci. and an approach. Leadership also serves to create and best practices. “A system must be first element. a set of marking. this is the leader’s function.

A good example is the approach taken by IBM Having presented the case that the five components Rochester. They Customer—the final arbiter often choose one or an isolated few of the systems Products and services—first with the best management principles. initiatives. and vision. Process Employee Customer Strategy Measurement improvement Leadership involvement focus Benchmarking X X Statistical process control X X Quality control tools X ISO 9000* X X New corporate vision. customer satisfaction. . or strategy X New products and/or new markets X Management of diversity X X Culture change X X Skills development X X Quality circles X Self-managed work teams X Kaizen† X X Business process reengineering X Concurrent engineering X X Work-flow analysis X Quality function deployment X X Customer assessment X X Customer service and relationship-based sales X *International Organization for Standardization (ISO) guidance for quality management systems. If a component is vital to the sys. involvement. if the strategy is not a part INSIGHTS FROM SYSTEMS THINKING of a system of management for organizational improve- Management of a system . Customer focus also significantly.14 Each of these strategies individually seems like a good idea. the following insights can be of its quality goals. JOHNS HOPKINS APL TECHNICAL DIGEST. and employee ful outcome. Quality Award Winner. A SYSTEM OF MANAGEMENT FOR ORGANIZATIONAL IMPROVEMENT the external sponsor who pays for the effort and the end to improve. expend a great amount of resources Quality—excellence in execution on introducing that principle.2 ciples often are developed with different emphasis over W. empowered. When the organization does not improve user of the product or service. tives. The quality objectives have been inte- Since each of the management principles in a system grated into employee performance plans that have been has an essential part to play.13 or are being applied on an individual basis are shown in Table 1. benchmarking. VOLUME 16. mission. Minnesota. tionships between all the components within the system and of the It is interesting that the systems management prin- people that work in it. then expect the organization People—enabled. it could have little effect. it should be present to make a significant ples is summarized in its vision: impact on the output. the management has no idea why. and rewarded Table 1. Figure 3 shows a strategic view nizational improvement. all must be present for a linked to achieving IBM Rochester’s business objec- successful outcome. applies inside an organization to everyone who receives Some of the strategies or methodologies that fit into and builds upon another person’s work (the internal this system of management framework that have been customer). requires knowledge of the interrela. Edwards Deming time. NUMBER 4 (1995) 405 . measurements and 1. . †Ongoing improvement involving everyone. However. Many organizations embarking on improvement do not understand this concept. excited. a 1990 Malcolm Baldrige in Fig. ment. The presence of its systems management princi- tem output.15 made by applying systems thinking: Notice how IBM Rochester leadership has intro- duced process improvement. All systems components must be present for a success. Strategies of organizational change and their relationship to the system of management principles. 2 constitute a system of management for orga.

The proper interrelationships among the management Customer-driven organizations stay close to customers principles are vital to achievement of organizational ob. 4. it will be a flimsy system. To satisfy the customer is the mission and purpose of every business. Peter Drucker states: “The customer defines the business . resolved and the real need is satisfied. A. An interesting insight provided in the system of management model in Fig. needs. intense communications with the 2. NUMBER 4 (1995) . Information and analysis is a specific Baldrige category that assesses key information and com- munications necessary to drive organizational improvement. customer wants and what an orga- All rights reserved. if the objectives are clearly defined and com- Total Customer Satisfaction” municated. In a system the interrelated components work customer requirements into internal organizational together toward some aim or common purpose. and wants at any given time ought to be ac- cepted by the leadership of an or- ganization and treated as seriously as budget reports. customer are required to ensure that differences are ents are vital. BROCATO operational performance and im- provement as well as to redirect the vision of the organization. © Copyright International Business Machines Corporation (IBM) 1990. Dynamic interrelationships of Malcolm Baldrige National Quality Award criteria (from customer and market data to Ref. 16). In- formation is communicated to link Figure 4. The Mal- colm Baldrige National Quality Award16 criteria framework embod- ies seven categories. K. (Reproduced with permission of IBM. 1991. . engineering test results. 406 JOHNS HOPKINS APL TECHNICAL DIGEST. . driven is often expressed in corporate policy statements: tives that the components of the system are to achieve.”17 What the customer thinks. Proper interrelationships among systems compon. the system will be adequately challenged and allowed to respond. POTOCKI AND R. “(Everyone’s Overriding Responsibility) However.) nization feels the customer needs. initiatives. as shown in Fig. This places in- formation and communications that link the various elements on the same level of importance as the elements themselves. • [Motorola’s] Fundamental Objective: If these objectives are vague. 15). These categories align well with the system of management principles. and create a cooperative process for translating external jectives. Figure 3. VOLUME 16. C. or marketing endeavors. The requirements. 2 is that the system compo- nents work cooperatively toward organizational objectives that are customer-based. This commitment to being customer definition of system emphasizes the importance of objec. Considering the interrelation- ships of the components of the sys- tem. A strategic view of quality goals. precise and timely information exchange is needed to achieve the system objectives. and vision at IBM Rochester since 1981 When gaps exist between what a (from Ref. believes.

and a clearly defined tively the system works. consistent often overlooked. 4) as the driver. which may not APPROACH improve organizational performance. that component which sets di. Alignment occurs when organi- driven. 8 tinuous process of making present entrepreneurial Autocracy Leadership 7 (risk-taking) decisions systematically and with the Alignment greatest knowledge of their futurity.19 10 A technique by which leadership optimizes the sys. departments. JOHNS HOPKINS APL TECHNICAL DIGEST. yet poorly aligned and working at times at 3. the whole system is affected. and staff have system components and the more efficiently and effec- clear direction. Organizational leadership environments (from Ref. The 1 test of a plan is whether management actually commits 0 resources to activate the plan. the customer satisfaction. MEASURES OF PROGRESS: USING Optimization of a subsystem without regard for the A SYSTEM OF MANAGEMENT whole system produces suboptimization. A organization) program office may push for minimum cycle time and Figure 5. and its im. Strategic planning does not require leadership and vision. Many outstanding examples are given in the liter- timization. design flexibility and precision tolerances. and measuring their results against the expectations procedures. The system should be managed in order to accomplish this purpose. while engineering may push for maximum “Quality excellence is the foundation for the manage. the system’s aim or pur. Leadership optimizes the system. VOLUME 16. Nor must all organizational improve- provement efforts will eventually be replaced by an ments be driven by strategic plans. Companies that are accus- approach. 4 through organized systematic feedback. enthusiastic responses. everyone. (clear direction. the organization’s management highly formalized plans. To avoid subop. An autocratic environment of high Optimization is a process of orchestrating the effects alignment but little empowerment fails to produce of all systems components toward achievement of the motivated. 0 1 2 3 4 5 6 7 8 9 10 A crucial value in strategic planning is that it can Empowerment (a strong feeling of authority. planning systems. etc. financial targets. Strategic planning is the con. Organiza. The purpose ment of our business and the keystone of our goal of of organizational alignment is to find equilibrium. 9 tem is strategic planning. shared vision. Figure 5 shows the organizational leadership tomed to defining their activities by other criteria environments when various levels of alignment and (departmental goals. and staff empowerment. power. policies. the clearer the interrelationships are among the zational executives. be used to create organizational alignment.2 ning is such an important leadership technique for For effective optimization. A SYSTEM OF MANAGEMENT FOR ORGANIZATIONAL IMPROVEMENT • AT&T Quality Policy: reduced cost.17 The distinc. Without clear. rections. 21).21 It takes heroic leadership to the shift in thinking to a total customer focus usually reach organizational objectives when people are highly requires “deep-rooted cultural change. not the details of the approach. accountability. NUMBER 4 (1995) 407 . The following sections describe how ment infrastructure. the system of management ought to have a ature of the successful use of these principles as a system leadership infrastructure—which is the entire manage. Leadership is viewed in the Baldrige framework improvement requires both organizational alignment (Fig. of management. If any part or component of the system is changed. 4) regarding strategic planning that is performance improvement.” “proper balance among such contradictions. Yet strategic plan- intriguing new management fad. optimizing the system that the Baldrige criteria make pose ought to be clearly defined and communicated to strategic planning a distinct element for evaluation. clearly defined 5 strategy. and guides the There is a clarifying note in the Baldrige criteria pursuit of added customer value and organizational framework (Fig. A leadership envi- objectives.) find that empowerment exist. middle managers. cross-purposes. and ownership throughout the tional elements could often have different priorities. This is the job of the organization’s leader. systems. and methods) 3 tion of a plan that can produce results is its ability to Abdication Heroics obtain the commitment of key people to work on spe.”18 empowered.”20 Organizational alignment is a prerequisite to em- The closer an organization gets to being customer ployee empowerment. 2 cific tasks and be empowered to accomplish them. and atically the efforts needed to carry out those decisions. creates goals and systems. Its most relevant measurement of success is improvement to the fundamentals of the business. or planning system will never be sound and efficient. 6 shared vision. ronment for optimizing the system for organizational ship. organizing system.

and improved market and reduced relief valve rejection rate from 21% to 0% and profitability). as an integrated approach to optimizing the effective- cally used the components of this proposed system of ness of the Navy–Marine Corps team by leading people. However. A major intent of the DON was to use TQL ola.5 years on av- Increased Organizational Performance erage for this study) for significant results to be Organizational performance is a true measure of how achieved.11 agement leadership. Eastman the Department. NUMBER 4 (1995) . . Digital Equipment Corp. Organizations that used these (the Navy’s flying units)” to produce P-3 antisubmarine principles achieved enhanced employee relations (less patrol aircraft “with 40% less labor than originally absenteeism and fewer grievances). New Jersey. customer satisfaction (fewer complaints and more re. have grasped the importance of the interrela- customers and guarantee effectiveness and efficiency. The Norfolk Naval Aviation Depot reduced F- peat business). Fur. (3) customer satis.20 tionships among the components of this management The following examples from industry. IBM. Table 2 summarizes these findings. the GAO study found common features in 55% to 6%. Total fact-based decision making.K. Cherry Point Naval four areas a number of indicators were identified that Aviation Depot TQL Office. In each of the sonal communication. Carolina. North could be used to measure performance. Finally. 3 July 1995).g. In addition to the private sector. and translating their vision. the Lakehurst Naval Air Warfare the quality improvement systems of all the organiza. that are implementing a quality improvement initiative should allow sufficient time (at least 2. and is still improving . A func. Operating procedures 65 59 2 4 ferent kinds of organizations bene. Finally. 22.11 well a system of management is functioning. . mission. and a proactive program to get tem of management experienced an overall gain in [improvement] suggestions from workers and customers corporate performance. Inc. VOLUME 16. General Accounting Office (GAO) con.” The elements of TQL are illustrated Kodak Company. . better operating planned. none of creases organizational performance. 7) (per- faction. process-oriented improvements. The prima. J. The Cherry Point Naval determine the impact of improving organizational per. The Naval Shipyard Norfolk (increased market share. BROCATO proper application of this system of management in.23 ry question on which the GAO study focused was: “Can Since implementing their TQL system of manage- significant improvements in business results be ment. greater of dollars saved for the Navy and taxpayers” (Ref.22 Af- research and development organizations illustrate such flicted by many of the same conditions as the private improved organizational performance. management. Cherry Point. The results: millions procedures (higher quality and lower costs). the Navy. one of alyzed empirical data in four areas: (1) employee which was gain sharing (a productivity-based incentive relations. Adams. 6. management structure. The Jacksonville. Motor. reduced its electrical connector fabrication rework from thermore. Ford Motor Company. “the ducted a review in 1991 of the performance of 20 approach used to implement total quality efforts within organizations (e. estimated that tions surveyed that were major contributing factors to improved performance: customer focus. such as the Department of the Navy most important variables to control in order to satisfy (DON). the GAO study found that organizations Aviation Depot “used work process tracking. and system for increasing organizational performance. employee in- volvement.. Naval In general. C. these organizations reaped those benefits immediately. Customer satisfaction 30 21 3 6 fitted from putting specific quality Financial performance 40 34 6 0 408 JOHNS HOPKINS APL TECHNICAL DIGEST. and (4) financial performance. improvement practices into place. strategies. the GAO study an. in Fig. Table 2. A. provides innovative. man. elements of the tioning organization is one where everyone knows the government. the DON in 1992 released its The U. Aviation Depot has achieved over $50 million in total formance through quality efforts.11 These organizations were among the managing systems. and Areas measured observations Improved Declined Unchanged partnership with suppliers. award) to increase employee involvement (Fig. Center Aircraft Division. p. open corporate culture. GAO survey of organizational performance of 20 companies. and affects customer The report concluded with a warning: organizations satisfaction. POTOCKI AND R. 8). Westinghouse. a new that adopted quality improvement principles as a sys. and public sectors.S.. and actions Malcolm Baldrige National Quality Award.10. (2) operating procedures. Strategic Plan for Total Quality Leadership (TQL).. for improvement within a quality-focused organization. and Xerox) that had strategi. Employee relations 52 39 9 4 the study indicated that many dif. the DON has seen many organizational improve- achieved through quality improvement initiatives?” To ments with resultant savings. savings through a combination of approaches. and improved financial performance 14 rework costs by 44%. Florida. highest scoring applicants in 1988 and 1989 for the and guiding principles into goals.

Savings associated with productivity gain sharing at the Quality Award. and linked the Research people into the plan. NUMBER 4 (1995) 409 . Naval Aviation Depot. identified Millions of dollars 40 critical processes.1M 5. 30 Total In 1990. AT&T has had the distinction of having three business units win the Malcolm Baldrige National Quality Award. Lucas.7M Leadership 2. To be competitive in today’s global economy. Fiscal year In 1993. to shorten the than 2 years in field-quality performance for cellular time from R&D to deployment.3M long-term commitment Millions of dollars 20 TQL savings = $18. all organizations must continually such as the Applied Physics Laboratory often provide improve the quality of the products and services they the first stages in the cycle of science and technology deliver to their customers. 25 23. VOLUME 16. In 1988. teamwork.27 Key principles in the hurst. ECC Research doubled its output without any savings substantial increase in resources. Since 1990. These assess- share ments have guided the company in quality improve- 0 ment efforts by helping Eastman combine what it has 1987 1988 1989 1990 1991 1992 1993 learned into an integrated and linked quality system.2M 0. bility. Research used the principles of customer focus. Implementation of fiscal year 1994 was $27 million in total savings (Fig.27 customer focus of R&D so that results are meaningful Applying this system of management for organiza- to the sponsors and end users.00 spent involvement/teamwork 15 to date Focus on the purpose 10 7.26 After 3 years of a company-led improvement initiative. AT&T Quality Policy at Bell Laboratories. 24 As such. ECC won the Malcolm Baldrige National Figure 7.5M TQL 5 3. development.21 Total personnel for every $1.0M TQL costs Quantitative 0. A SYSTEM OF MANAGEMENT FOR ORGANIZATIONAL IMPROVEMENT 30 Training 27. North Carolina. Quality Policy were: “all organizations and functions Research and development (R&D) organizations have customers. and contin- uous improvement in an innovative way to improve its 60 output. process focus. Among its ex- making efforts to improve the cooperation between amples of successes is a 30-fold improvement in less R&D and technology transfer efforts. ECC Research focussed on this output. W.25 tional improvement to R&D organizations presents R&D organizations are starting to reap the benefits particular challenges because of the nature of the peo- of such efforts. AT&T’s R&D community at their total return on TQL investment as of the end of Bell Laboratories issued a document. Return on TQL investment at Naval Air Warfare Center improvement Aircraft Division. organizations have been customers—the AT&T business units.6M 1. 5 July 1995). Eastman Chemical Company (ECC) ple and the work. Research’s main output—new or improved 50 product and process concepts—was not improving. Cherry Point.8M or approximately $3. New Jersey. Lake.3M Constancy of purpose.” Bell Laboratories then reengineered and rede- that cycle must form an unbroken chain of continuous fined itself to become more responsive to its improvement. Lakehurst. An initiative that focuses only on JOHNS HOPKINS APL TECHNICAL DIGEST. In 1989.9M 8. and de. Elements of the Department of the Navy’s Total Quality Leadership (TQL) plan. Eastman 20 has used the Malcolm Baldrige National Quality Award 10 Employee criteria for annual internal assessment.3M 4. to customers and to quality. Naval Air role of R&D in implementing the AT&T commitment Warfare Center Aircraft Division TQL Office. New Jersey. quality improvement comes conceptualization. from process improvement and is everyone’s responsi- ployment. management leadership. Supplier partnership Figure 6. application. instituted a few simple but credible measures. outlining the 8) (personal communication. and to increase the software development.7M 0 methods 1989 1990 1991 1992 1993 1994 1995 1996 1997 Year Customer focus Continuous Figure 8.

the group was able to track the status of that takes customer requirements into account. created an opportunity to cut costs and reduce process. and used to overlay the heat sink. A significant effort in design was in- in about 11 months. a full-sized Mylar to more efficiently dispose of this environmentally drawing was created from the computer-aided design sensitive waste. cross-functional team of professionals The following examples from The Johns Hopkins and support staff to respond to the challenge of imple- University Applied Physics Laboratory demonstrate menting government-approved procedures to ensure innovative process-oriented improvements that result the timely and responsible closeout of all subcontracts. On the a Japanese word that means improvement. VOLUME 16. The project provided a final but essential step in subcontract administration. 50%. ment time by 25%. and quality assurance groups examined ity improvement award because of its impact on worker the process for developing heat sinks (metal plates health.28 nearly 1000 subcontracts. The process improve. and even 100% and more. cesses and showing the proper steps to close out each ment. Where Kaizen is intro- duced for the first time management may easily see productivity type of subcontract. Subcontract Closeout Administration tive that builds teamwork and enhances innovation in The project of a process action team that focused on teams still has to respect the creative contributions of subcontract closeouts at APL is a good example of an individual scientists and engineers. the team developed training increase by 30%. A coolant reduction system was installed using the machine for inspection. the team developed a plied to an organization. After completion of become more attentive to customer needs and builds a system the project. The team’s solution. . The team first identified and analyzed an enormous ment within the organization. with timely closeouts millions of dollars could be made available. The department leadership chartered an Process-Oriented Improvements eight-member. stand the problem and determine root causes. all without and provided education and support to hundreds of staff any major capital investments. . managers. Reacting to a customer’s request that efforts be ment program. 30 is a project that was accomplished by an employee involvement quality team in the APL experimental Heat-Sink Development machine shop. reduced the development cost per 410 JOHNS HOPKINS APL TECHNICAL DIGEST. NUMBER 4 (1995) . An initiative that months and continues to pay for itself today. . a team representing de- “waste coolant reduction system. When ap. .29 values only facts and measures may lose the benefits from intuition. and the environment and because it attached to electronic circuit boards to dissipate heat). A diagram of the existing process is labeled “old pro- ing time for waste coolant. number of measurements in order to thoroughly under- ment projects discussed manifest the concept of Kaizen. An initia. POTOCKI AND R. inspection to measure the locations of the holes and working machinery. C. and employees . basis of the process analysis. This innovative move the water. Waste coolant is approximately slits in the metal plate and compare them to the dimen- 90% water and is contaminated by bacteria formed from sioned drawing. 9. Real innovation occurred when this the combination of metal fragments and hydraulic and team challenged this method of inspection. sign. A. Using an ultrafiltration system to re.K. An initiative that administrative work process improvement. at APL. The annual cost process” in Fig. .” won a corporate qual. It was Waste Coolant Reduction System estimated that millions of dollars were freed up as a A fine example of a technical process improvement result of this improvement. BROCATO today’s customer loses sight of the role of R&D in therefore. Kaizen means manual that explained the different types of contracts. It decreased the heat-sink develop- savings were twice the cost of the filtration system. the team was able to reduce the volume approach simplified the process to that labeled “new of waste to 10% of its original volume. the improved system paid for itself in 6 creating new customers in the future. volved in developing a fully dimensioned drawing of The quality team of six experimental machinists the heat sink so that these data could be entered by investigated the problem of disposing in a safe manner hand into a coordinate measuring machine used in 55-gallon drums of waste coolant generated by metal. Instead of way lube oils. A manage- strives to continuously improve the organization today ment audit of the subcontracts process indicated that has to assist it in becoming something different tomorrow. It helps management members concerning the process. The manpower requirements and dis. Next. experience. from the proper application of this system of manage. heat sinks illustrates process improvement and signif- chining waste coolant had become overly expensive as icant cost savings in engineering design and fabrication a result of the shop’s newly adopted coolant manage. Streamlining an engineering process for developing posal costs for safely and efficiently disposing of ma. fabrication. The project was completed cess” in Fig. The manual included flow charts delineating the pro- ongoing improvement involving everyone—top manage. . and perspective. 9. safety. installation of a made to reduce program costs.

volvement. All of the systems com- leadership in response to customer feedback. with a recognizing the interrelations or that all the compo- 25–40% cost saving. and improved financial perfor- actions in the workplace to better serve the customer. Comparison of old and new heat-sink development FINAL THOUGHTS processes at APL. fleet commanders. not ly took 4–6 months were decreased to 2–8 weeks. proposed Enter data and implemented improvements. The concise report Quality reduced the development cost 15% and received glow- assurance ing reviews from the Fleet. This concept contends that JOHNS HOPKINS APL TECHNICAL DIGEST. it gives organizations The APL projects described next delineate this axiom a competitive edge. the team implemented a totally new streamlined improving organizational performance. The team’s goal. A SYSTEM OF MANAGEMENT FOR ORGANIZATIONAL IMPROVEMENT Old process New process Technical Reports Engineering Engineering design design An APL cross-functional team of engineers was Draw Draw formed to improve the efficiency of the reporting of at- sea operations for use by crews. satisfaction form a systematic approach to managing ment team at APL. The that have used these principles successfully to make Navy sponsor was able to realize a significant reduction significant improvements understand the interrelations in effort related to the processing of requests. The team surveyed customer requirements for information. better operating procedures. this article is an approach to achieving enhanced em- tional improvement needs to understand customer ployee relations. implemented the principles in a partial manner. Organizations business administrators also recognized the simplicity of that have failed in improvement initiatives often have ordering computer equipment. A prerequisite guideline for applying this concept is to understand that the five guiding principles of mea- Personal Computing Omnibus Contract surements/benchmarking. mance. and other organizations. sent the report to the Fleet and to the sponsors.33 eliminating unnecessary drawings and hand entry of Howard Coonley data. greater expectations and translate those expectations into customer satisfaction. developed a new Fabrication concise report. a system of management for organiza. VOLUME 16. set by department organizational improvement. and customer member computer user services center process improve. Procurements that normal.32 nents must be present. under a comprehensive disciplined approach focused on proval. measured customer response. Since these reports are repeated for different operations. The system of management integrates them pleting a process analysis. process improvement. in practice. com. data. leadership. Inspect Inspect Figure 9. NUMBER 4 (1995) 411 . was to ponents must be present for a successful outcome. When applied correctly. and evaluated Machine Machine the new process. the Dimension Navy sponsor. Organizations procedure within 5 weeks from the start of the project. Users and and interactions of the five principles. improvement initiatives using a systems approach focus on producing an entire Impact on Customer Satisfaction business enterprise that is optimized to deliver value to its customers. identified significant Fabrication contributing processes to the existing report. etc. employee in- An award-winning project was conducted by a four. and the assurance Enter data Fleet receives a superior product. The executive of the future will be rated by his [her] ability to anticipate his [her] problems rather than to meet them as they heat sink by nearly $1300. The system of management described in To succeed.) to meet changing Check customer requirements. expedite purchases of personal computing equipment Piecemeal application of the principles does not opti- for major R&D programs. and increased quality by come. The major goals were to increase the utilization of the report findings without an increase in cost to the sponsor and to tailor deliverables (reports. and gaining management ap. interactive. These principles are interrelated and After performing a customer requirement study.31 At the corporate level. mize the system. the sponsor benefits from the cost Quality savings on each report now and into the future.

J. Quality Symp. Hall. “The Cost of Quality.edu.C. and Katel. In 1994. His e-mail address is Rick. “Results-Driven Quality . D.. REFERENCES Bradenton. Atlanta. E. Bob King. GAO/NSLAN-91-190. J.. and was engineering manager for the Hopkins Ultraviolet Telescope.. 21 cmi Leadership Training Program.. 323–329 (1992). Dr. V(4). he was awarded a Ph. R&D Quality Symp. Hughes Aircraft Company. Qual.1–1. p. degree in organization development from the University of Maryland.7 (15 Jun 1993). R&D Quality Symp.. E. 27 Mayo. His dissertation topic was “Using TQM to Teach TQM: A Case Study in the G. pp. Tucson.Brocato@jhuapl. R. . pp. J.” in 6 Matthews. TQM America: How America’s Most Successful Companies Profit from Total Quality Management. M. 1–7 (16 Jun 1992). MD (1995). POTOCKI received his B.. “TQM Must Focus on Results. E. Education.The Kaizen Institute. Global Human Resource Development. . “Why Total Quality Programs Miss the Mark. D. 32 “Riding the Omnibus Express. . (10 Feb 1992). Part 1. Issue 16 (Winter 1991–92). M. Juran Inst. VOLUME 16.” Total Qual. Responsibilities. 1995 Award Criteria. C. pp. Center for Advanced Engineering 22 Carr. D. Chief of Naval Operations. Massachusetts Institute of Technology. IL. General Accounting Quality Teams newsletter). 8 Blewitt. 48-49 (7 Proc.. ODR. Methuen.. S. W. Washington. Cambridge. p.S. 28 Imai. Whiting School of Engineering.. Chicago. p. and an M. and engineering design and fabrication. “Managers Express Ambivalence for TQM. The Free Press. p. BROCATO leadership ought to study and understand the system 15 The Quality Journey Continues . R&D 5 Myers.. and Commandant of the Marine Corps 4 Schaffer. At APL he has led major activities in underwater acoustics. Proc. Juran Inst. W. J. 3(3).” Training & Dev. was program manager for the HILAT satellite. R&D Quality Symp. Prentice- QPC. 14 The Challenge of Organizational Change. Brocato was honored by the Association for Quality and Participation and given national recognition as a “Quality Champion” for his contributions to the quality management field. 13 (Dec 1989–Jan 1990). Secretary of Morrow and Company. . Business J. 23–29 (Jan 29 “Waste Coolant Reduction. U. John Wiley & Sons.. Chicago.. Inc. 1992). p. 52 (1990). Chicago. S. Harper and Row. Institute of Standards and Technology. Rev. New York (1992). and Engel. Excellence in Government. and managed for optimization of the goals of the 18 George. MN (Mar because knowledge is built on theory and theory is 1991). Issue 16 (Winter 1991–92). 25 Tapp. pp. cum laude in technology and management. Arlington. Manage.. JHU/APL TSS-94-172 (15 Sep 1995). 40–44 (Mar 1993). Kaizen.C. Office.” in Proc. AZ.. 12 Gibson.9 (16 Jun Sep 1992). 2 Deming.” Manage. The Engineering and Fabrication Branch (1991).. B. “Improving Research Using Total Technol.Potocki@jhuapl. pp. a dual appointment with The Center for Astrophysical Sciences at the Homewood Campus. Whiting School of Engineering Part-Time Graduate Programs since 1973. “A Systems Approach to Research Management.. “When TQM Goes Nowhere. M. 2A. New York. 33 Thoughts on Leadership. P. K. Inc. E. MA (1989). National necessary to predict and improve the system. submarine inertial navigation.” in Proc.. and currently serves on both program committees. D.. IL. DC 31 Meyer..S. 10 Chang. J. Dr. R. 11 GAO Report—Management Practices—U. NJ.edu. in applied behavioral science from The Johns Hopkins University in 1984. 1. “Quality Improvement Process at a National Laboratory. Companies Improve Performance 30 “The Terminators Terminate Closeouts!” The TeamWork Report (JHU/APL Through Quality Efforts. . Ltd. D.S. 6 (1995). Not Techniques. His e-mail address is Kenneth.S. and Weimerskirch. Now!. graduating Phi Kappa Phi from the University of Maryland in 1978. FL (1995). D.. 226–227 (1986). The Forbes Leadership Library. Coopers & Lybrand. and McClaskey. 17 Drucker.” Washington pp.. R. IBM Rochester.1–1.” J. engineering technology development. Practices. Techniques Proven at Today’s Most Successful Companies. . F. respectively. 1... Participation. p..1991. McGuinn & McGuire Publishing. National Security and International Affairs Division. He serves on executive committees for the JHU Center for Non-Destructive Evaluation and the American Defense Preparedness Association Science and Engineering Technology Division. A. GA (1993).. 11 (14–20 Dec 1992).9 (7 Jun 1994). THE AUTHORS KENNETH A. 20 King. pp.. and Littman.. D. M. He has taught applied physics and technical management in The Johns Hopkins University G. BROCATO received a B. Juran Inst. degrees in high-energy nuclear physics from Indiana University in 1965 and 1968. “Total Quality Management at AT&T Bell Laboratories. and Ashkenas. 273 (1992). POTOCKI AND R. degree in physics from Loyola University (Chicago) in 1962 and his M.” Newsweek. 3 Barker.” The TeamWork Report (JHU/APL Quality 1993). S. C. ponents or processes of the system ought to be aligned New York (1974).W.. Future Edge: Discovering the New Paradigms of Success.” in 9 Wilkinson. 24 Wiley. Brocato joined APL in 1969 and is a Senior Professional Staff member and Manager of the Quality Improvement Services Office. IL.D. A.. 16(5). “Good Science Is Good Quality. Englewood Cliffs.” Dr.” Washington 26 Holmes. Quality Management.” The TeamWork Report (JHU/APL Quality Manage. The com. IL. pp. and Ph..” Res. R.W. Heatsink Development Process. Y. MA (1993). Rochester. 18–27 (1993). Chicago. 19 Anschutz. Juran on Leadership for Quality.S. J. New York (1989). R. I. Chicago. William 23 Department of the Navy Strategic Plan for Total Quality Leadership. K. 4 (1993). 412 JOHNS HOPKINS APL TECHNICAL DIGEST. A... J..K. ... and Grimm. GOAL/ 1 Morquardt. NUMBER 4 (1995) .. the Navy. Government.1–2A. P.. Triumph Books.. Issue 22 (Winter 1993–94). M. Gaithersburg. IL. Total Quality Management—Strategies and organization. P. M. Management: Tasks.D. D. “The Other Side of Quality .. Juran Inst. 7 MacFarland. He is the lead author of a recently published book entitled Empowering the Leader Within: Four Essential Virtues—A Process for Achieving Peak Leadership Performance.. New York (1994). VA. Studies. Hoshin Planning: The Developmental Approach. Teams newsletter)... 16 Malcolm Baldrige National Quality Award. A. 13 Juran. RICHARD C.. 215–228 (Jul 1962). Inc. Teams newsletter). The New Economics for Industry.S.. Potocki joined APL in 1970 and is currently Assistant to the Director for APL Improvement and Associate Head of the Technical Services Department..