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Implementation of “14 Quality Principles for Value Streams” In the Company

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Conference Paper · November 2017

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Vision 2020: Sustainable Economic development, Innovation Management, and Global Growth

Implementation of “14 Quality Principles for Value Streams”

In the Company from the Automotive Industry

Arkadiusz Kowalski, Wroclaw University of Science and Technology, Wrocław, Poland,

arkadiusz.kowalski@pwr.edu.pl (corresponding author)

Paulina Nowacka, Wroclaw University of Science and Technology, Wrocław, Poland,

205893@student.pwr.edu.pl

Piotr Szafer, WSB School of Banking, Poznań Poland,

piotr.szafer@wsb.poznan.pl

Robert Waszkowski, Military University of Technology, Warszawa, Poland,

robert.waszkowski@wat.edu.pl
Abstract
This article presents the implementation of “14 Quality Principles for Value Streams” in the company
from the automotive industry. The Bosch Company has created a set of 14 principles and special
criteria that it considered most important for its production system. Deploying them to all positions
has become a superior goal for the entire organization. One of the important steps to take to achieve
this goal is a thorough analysis of the prevailing conditions and careful planning of the action.
Therefore, the first important step in the following work is to create an implementation plan. Then,
based on a previously prepared evaluation sheet, a comparative analysis is made between the current
state and the requirements contained in the 14 Company’s Quality Principles.

Keywords: Automotive Industry, 14 Quality Principles, TQM, Project Management

Introduction

Economic changes in recent years have made the quality of products and services become a key
criterion for the success of an enterprise (Gola (2014)). Equally important is the knowledge of the
managerial staff on the potential for enhancing the results of work, which is the result of knowledge
of the theoretical and practical basis for improving the company’s business. Sustainable and
continuous quality improvement can only be achieved by directing the organization’s efforts to plan
and prevent problems that occur at the source. This concept of quality management is called quality
assurance, where greater emphasis is placed on advanced quality planning, training, product design,
process and service improvement, process control and engaging and motivating people (Dale
(2003)). Improving the quality also requires knowledge of customer expectations (Kłosowski and
Gola (2016)). Is more than just collecting data from processes and from the customer.

How to more effectively manage the production company? There are many techniques and methods
but not all are effective in practice. As it turns out since the early 1990s, the best results are achieved
by Japanese entrepreneurs. Therefore, for many years, the eyes of all managers are headed in that
direction. A good example is Toyota’s phenomenon. This company is renowned for its high-quality
products, cost-effective pricing, and innovative management approach. Its annual revenues are
billions of dollars, so it is no wonder that it is considered one of the most profitable companies in
Japan and North America. However, the main advantage of Toyota is its production model, the so-
called “Lean Production”, which is today widely regarded as another step in the evolution of the
manufacturing process after the introduction of Ford’s mass production system (Liker and Maier
(2006); Bhamu and Singh Sangwan (2014); Jasiulewicz-Kaczmarek (2014); Chay et al. (2015); Liu,
Wang and Peng (2015); Epler et al. (2017); Jasiulewicz-Kaczmarek and Saniuk (2018)).

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High achievements in this area of Toyota have caused many companies to take an example and
introduce their own system of quality improvement. Most of them are based on “Lean Production”.
This is exactly what happens at Bosch Company, which is analyzed in the following paper. The
company has created a set of 14 principles and special criteria that it considered most important for
its production system. Deploying them to all positions has become a superior goal for the entire
organization.
This work presents the implementation of “14 Quality Principles for Value Streams”. The
deployment process is based on a single assembly area. 14 principles of quality is an important
element of the functioning of this enterprise. On the basis of the experience gathered in other
branches of the company, the effectiveness of the changes is very high. Significantly improve the
quality of products and notice the decrease in complaints from customers in the long term.

One of the important steps to take to achieve this goal is a thorough analysis of the prevailing
conditions and careful planning of the action (Anholon and Sano (2016)). Therefore, the first
important step in the following work is to create an implementation plan. Then, based on a previously
prepared evaluation sheet, a comparative analysis is made between the current state and the
requirements contained in the 14 Company’s Quality Principles. For such a complex project, an
important element is also the creation of an appropriate team to make a fair assessment of the
process. The whole course of the assessment with a corresponding comment to specific points is
presented and described so that in the next step it is possible to draw appropriate conclusions and
present them using the scoreboard. Following the evaluation, the changes to be made and the plan for
their implementation is proposed. Then an example of process improvements is presented. All
enhancements are based on the implementation of process-related principles. The final results are the
impact of the improvements on the results of the assessment and the appropriate conclusions.

14 Quality Principles

“14 Quality Principles for the Value Stream” are the main rules in Robert Bosch company for the
production system, implemented in every Bosch plant. It is very important to provide high-quality
production in the automotive section. In this area of manufacturing, every single mistake or oversight
could be dramatic in effect for the user (Świć and Gola (2013)). It is easy to imagine what can happen
when breaks in our vehicles do not work properly. There is human life in consideration. That is why
automotive companies should pay high attention to every detail which can cause any mistake.

Every rule in 14 Quality Principles is described very detailedly. It has to be clearly written and easy
to understand for everyone. Most of the rules presented below have own equivalent in inside Bosch
procedures. Some of them are already implemented but are not directly connected with 14 principles.

Principle 1: Customer Complaints. “Customer complaints are communicated within the production
site and displayed at the station in question. Using problem-solving techniques, they are processed in
a fast and systematic manner. The supply chain is promptly informed” (Fischer, Gemmer and Rach
(2017)).

Principle 2: Control limits applied. “In the event of deviations in quality or if control limits are
exceeded in the value stream (source, make, deliver), the employee needs to stop the process or
escalate” (Fischer, Gemmer and Rach (2017)).

According to the instruction, three steps should be done after exceeding limit: Stop, Ask, Wait, when:
- 4 identical deviation are explored,
- 3 identical deviation are explored during 2 hours,
- 4 deviation for the same reference from one supplier are explored during 2 hours,
- 1 deviation is explored after one part go through all control point,
- 1 deviation is occurred caused by any problem.

Principle 3: Instruction. “Safety, health, production, and inspection instructions have complied with
5S standards are put in place and observed” (Fischer, Gemmer and Rach (2017)).

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The instruction should be placed in space easy to access in latest document edition. The instruction
should contain safety symbols and if appropriate, work instruction of manual works content right and
left-hand movement description with illustrations. It concerns such instruction as TPM, health and
safety, production and quality, 5S etc. The failure modes from the FMEA and special characteristics
from the control plan are taken into account.

Principle 4: Process Parameters. “The target values/tolerances for all stated process parameters are
observed” (Fischer, Gemmer and Rach (2017)).

Without any exception during the assembly activity of every single part, all parameters are controlled
by detectors. Thanks for that it is easy to prevent dangerous situations. When the parameters are
exceeded program stop the process.

Principle 5: Measuring & Test equipment. “Measuring and test equipment are defined, and
monitoring intervals are observed” (Fischer, Gemmer and Rach (2017)).

Principle 6: Check the checker. “The check the checker principle is applied, and the checker’s
suitability is ensured” (Fischer, Gemmer and Rach (2017)).

“The suitability of processes used to prevent or detect errors (e.g. camera-monitored processes,
sensor-based measurements, inspection processes) needs to be checked according to a predefined
standard. Possible errors, such as loading the incorrect camera software/testing program or improper
sensor calibration, need to be prevented by carrying out the inspection. These inspection processes, as
well as maintenance and set-up processes, need to be evaluated using appropriate methods (e.g.
FMEA)” (Fischer, Gemmer and Rach (2017)).

Principle 7: Total Productive Maintenance. “A maintenance standard is installed and observed at

every station” (Fischer, Gemmer and Rach (2017)).

TPM instruction says about how to maintenance machines to prevent the unexpected damage and
breaks and how to elongate machine lifetime. Document contain: who, what and how often should
accomplish the defined activities. Instruction should be hang out in a place which is available for
every worker of the workstation. Except for operator, TPM activities should be executed by
Maintenance Department.

Principle 8: Tools. “Each tool has a defined service life; the current status must be recognizable.
A quality evaluation must be carried out during removal or disassembly” (Fischer, Gemmer and Rach
(2017)).

“The current service lives of all tools have been recorded. A warning system promptly displays when
tools need to be serviced or replaced. Each tool needs to be inspected when removed or disassembled
to check for damage/ wear and tear. In case of deviations, it is necessary to follow measures to ensure
product quality is maintained. Restart is performed according to clearly defined rules (see
Principle 9); the standard is regularly reviewed” (Fischer, Gemmer and Rach (2017)).

Principle 9: Regulated restart. “Restart after disruptions are clearly regulated for all machinery and
equipment” (Fischer, Gemmer and Rach (2017)).

“Downtimes can alter process parameters, workflow sequences may change, and the consistency of
material and supplies can change. All devices have been inspected according to a defined standard for
quality risks in connection with disruptions (for example, an unplanned disruption to the welding
process, the injection molding process stops unexpectedly, a product remains in thermal treatment for
too long, the silicone bead is exposed to the air for too long). The standard also includes the analysis
of critical wear parts (for example, drill bits or welding electrodes). Following longer disruptions

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(e.g. station upgrade), it is necessary to newly release the process and carry out a process audit”
(Fischer, Gemmer and Rach (2017)).

Principle 10: Labeling. “Products and containers are labeled according to the set standard” (Fischer,
Gemmer and Rach (2017)).

Product must always have a clear status. All parts have the inimitable reference number. Additional
identification is provided by colorful labeling system (white color – good part, yellow color – parts in
testing, green color – tested, blue color – prototype, red color – scrap, white with red band – blocked).
What are more “[…] red boxes must be secured against unintended access (e.g. by locking them,
covering, spatial separation, covering during transport). Containers for rejects must be emptied in line
with standards and the parts must be analyzed. Parts on the analysis station are spatially separated
from the production flow and clearly identified. Only parts with the same status in the same
container, no good parts in the red box. Products are protected against environmental influences (e.g.
contamination) in line with regulations” (Fischer, Gemmer and Rach (2017)).

In the standard, the places intended for storage or direct delivery components to production, are
labeled by the slate with the reference number and with photography of component. Visually
presentation is more readable for workers. When the product has the wrong label or is placed in the
incorrect box, the complaint should be submitted. All process is then analyzed and the risk of
production danger is evaluated. Special reaction steps are implemented.

Principle 11: Rework / Scrap. “The handling of rejected parts and those to be reworked is clearly
regulated” (Fischer, Gemmer and Rach (2017)).

All components are visually checked during the process. Thanks for that the negative one can be
detected before causing any danger in the final product. Every defect which is noticed by the operator
should be reported. If the problem is caused by nondependent reason from the production process, the
preselection before delivery component on the production line is provided. During this selection, all
defective parts are rejected and the scale of the problem is defined. Problem analysis help to assess on
which level defects are created and prepare special activities to avoid this situation in future.

Principle 12: Dropped parts. “Any products that fall on the floor, into the machine or cannot be
classified must be scrapped” (Fischer, Gemmer and Rach (2017)).

If during the process any part is dropped, regardless of its condition is scrapped in the special red
container (the same as in the previous principle). Product after fell down can look untouched, but the
internal structure and functionality might be broken. In that case, part qualifies as nonconformity and
cannot be used in the process.

Principle 13: Correct Product. “Only the correct product may be provided for removal and
assembly” (Fischer, Gemmer and Rach (2017)).

To producing the particular product, defined components are used. In some cases can happen that
there is no visual differences between parts uses for various references. That is why during the
changing process all delivering components must be controlled. Information about which component
should be used in which references are placed in carts on the workstation.

Principle 14: Remaining Items. “The handling of remaining items/ quantities is clearly regulated”
(Fischer, Gemmer and Rach (2017)).

The FIFO rule means that the parts with the oldest production date must be used first. It helps to
avoid using wrong parts with exceed lifetime and maximum time of storage. The logistic department
is responsible for changing components during the changeover and for delivering old components
back to the supermarket.

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Approach to Work Improvement and Tools Description

Continuous improvement of the organization is a prerequisite for its survival on market under
conditions of increasing competition. The concept of improvement of work organization is
understood as the implementation of improvement activities (organizational, technical, etc.), leading
to the increased rationality of the functions carried out by the workplace, which should lead to
increased economic. The issues related to the improvement of the functioning of the organization
have been in the past and are currently the subject of numerous theoretical and practical
considerations. The mainstream of interest in the improvement of economic organizations is focused
on finding solutions to increase, broadly understood, economic effects of their functioning. The
methods and tools for improving and evaluating processes of improvement are still of interest.

Nowadays, professionals seek to implement methods that will increase the efficiency of their work
but will not be overly capital intensive. Often, efforts to streamline the workplace of production sites
are complex and require appropriate analysis, involving production staff but above all a well-thought-
out approach. In order to streamline the process with tangible benefits, it is necessary to analyze all
the activities carried out in the implementation of the production process (Bartnicka (2016)).

The methodology is defined as a set of guidelines for how the procedure to be followed when
performing a particular job or for achieving a specific goal (Marciniak (1989)). On the one hand, it
deals with problems related to problem-solving, and on the other hand, describes their solution. The
concept of methodology and its overall importance in carrying out various projects can be
characterized as a way:

- a formal and detailed description of the activities carried out in the implementation process division
into different stages and activities,
- covering all activities from the preparation stage to the phase exploitation of the implemented
solution,
- planning activities on the basis of which implementation works are carried out,
- arranging and systematizing the implementation of the system,
- gathering principles that help guide the project (Trzaskalik (2005)).

The systematic problem-solving methodology is a multiple process that consists of activities:

- defining the purpose and modeling of the problem situation,

- analyzing running tasks,
- interpretation and interpretation of possible changes in the existing situation,
- determine the ability to target,
- planning strategies and resources,
- implementation of problem-solving in practice.

Improving work organization in an enterprise can be divided into three general phases, according to
the life cycle of the project: preparation, design, implementation of change. The first phase focuses
on creating the right climate for improving work. The venture must have strong support in
management, otherwise, it will not produce the intended results. Activities in this phase involve the
training of a working group and the provision of information to employees of production sites about
their activities. Workers need to realize that their work and machine performance affect the position
and competitiveness of the company they work in (Kosieradzka and Krupa (2009); Abolhassani,
Layfield and Gopalakrishnan (2016)). Every employee should know what his role is throughout the
system and how he or she can contribute to improving the business. The second and third phases, on
the other hand, focus on designing activities and implementing methodologies for improving work
organization by creating a team-based system and initiating profit-driven activities.

The application of the presented methodology allows, among others, to increase productivity, reduce
product flow time, reduce waste, improve ergonomic conditions. In addition to measurable profits,

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the benefits to the company include increased employee engagement, acquisition of new skills, and
the release of creative potential. It includes the following steps:

- development of assumptions,
- gathering information about the workplace,
- analysis of collected data and defining major problems,
- defining corrective actions and their implementation,
- control of results and evaluation of results.

Other benefits of using the methodology include its versatility, ease of sharing knowledge,
guaranteeing a thorough deepening of the problem without neglecting important aspects and
maximizing effectiveness. Clarification of the organization of the work organization improves the
dissemination of good practices for the whole organization and the use of elaborated solutions. The
methodology is divided into following phases.

Phase I - Development of assumptions. Assumptions are information that needs to be taken into
account when preparing work. They affect the direction of activities and define the expected end
result. The assumptions should include elements such as:

- name and description of the area where work improvement activities will be carried out,
- objectives and expected benefits from planned improvements,
- justification of commencement of activities,
- restrictions,
- work schedule,
- defined resources.

Phase II – Data collection. The information that will be collected is intended to determine the initial
situation area functioning. News must be objective and come from reliable sources. This may be in
the form of descriptions, tables, diagrams, graphs, drawings. As an example can be procedures,
requirements, instructions or dissemination of results and statements. It should take the time to
observe, exchange information with and work within the area. The purpose of this stage is to draw
conclusions about the work done, manufactured products, used machines, instructions, level of
performance, etc. Knowledge of the position will help define the main problems. Occurring in the
production process. In addition, this set of initial information will allow you to evaluate progress.

Phase III – Analyze the collected data and define the main problems. At this stage, data should be
sort in the right order: the cause of the problem, the problem, and the effect of the problem. The
analysis is based on a comparison of activities in the post with its optimized functioning. This applies
to any behavior occurring in the area under investigation. It is possible to calculate what investments
involve the implementation of improvements. It must be stated whether it is worth dealing with all
the dysfunctions encountered, or whether only the most important ones, causing the longest
downtime in production or generating the greatest losses.

Phase IV – Define corrective actions and implement them. The fourth stage is a time to reflect on
the corrective measures to be taken to achieve the goals. Solution development will involve testing
and simulation to select the most effective solution. There is a risk of encountering a large number of
problems, technical difficulties, and employee resistance. It is important to cooperate with specialists
and support the management. Once the corrective actions have been defined and their implementation
is implemented, a comparison of the effects of the initial situation will be made..

The implementation of the solutions is aimed at reducing costs, improving quality, reducing the
delivery time of products to the customer. Improvements should be designed so that they can be
applied regularly and recognized as a new standard. Initially, pilot implementation can be carried out
in only one separate area of the site and gradually expanded. Targeted personnel should be qualified
and trained to use their working time effectively. Machinery and equipment are to be in good

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condition, in adequate quantity to meet the needs. There should be no downtime or interruptions,
unnecessary operations. Work methods are designed to guarantee safety and good organization.

Phase V - Control and evaluation of results. Once the corrective measures have been implemented
to improve the job, a stabilization step is required. It means repetition of a defined working method,
trained staff and achieving an optimal level of performance. Audits and the so-called. Manager’s
celebrations. Assuming that after the optimization has been carried out, monitoring of results will not
be continued, then the level achieved will deteriorate. It is good practice to carry out a daily
celebration by the manager to ensure continuity of production.

Audits are performed less frequently. During the audit, the use of working methods, quality
procedures, functionality and efficiency of operations, productivity, the organization of work, order
and cleanliness are verified. This ensures that the achieved performance level is maintained and
shows where there are shortfalls that need improvement. The audit always ends with a feedback on
the result. After the audit, actions are defined to return to a certain standard.

Rationality inaction leads to cost optimization, their reduction to a satisfactory level due to the
economic performance of the organization and the level of quality of the products. The presented
methodology for improving work organization at the production site allows for detailed analysis of
problems and generating corrective actions, leading to systematize and create a structure of
performing improvement actions to ensure the correct transformation of the enterprise. As a result,
effective solutions are obtained and maximum efficiency is achieved. The risk of failing to meet the
goals is reduced to a minimum (Bartnicka (2016)).

The concept of evaluation can be considered in various respects and meanings. In the most general
sense, the judgment is a judgmental court, any statement expressing a positive or negative response to
someone or something. Evaluations are psychologically and socially conditioned, they change
historically according to changes in the systems of values they belong to. The objects of evaluation
are called values in general, actions that determine them - evaluation or evaluation, and results -
evaluations. Already the distinction between these concepts leads to the problem of expressing the
difficult and complex - the objective existence of values and, consequently, the problem of objective
assessment.

The use of multiple assessments in an enterprise depends on a number of factors, but the criteria for
evaluating the idea and place of assessment in an enterprise are important. These criteria should be
included:
- the purpose of the evaluation,
- the test methods used,
- the time to which the assessment relates,
- the detail of the study.

Depending on the destination, the rating can be divided into those for internal and external business
purposes. Internal assessment is tailored to the decision-making needs of the management and other
management levels in the enterprise. It allows you to assess economic events at different times, both
ex-post and ex-ante, at different classification levels, using modern information processing
techniques and research methods appropriate to this assessment. External evaluations are designed for
the broadly understood corporate environment (shareholders, investors, shareholders, state
institutions, banks). Taking into account the time to which the assessment is based, retrospective,
current, and prospective evaluations can be distinguished. Prospective assessment includes the results
of past actions.

Implementing Plan

The automotive industry requires very good quality from its products. Great competition in the
market and dangerous consequences do not allow the products to be weak. That is why every
company in this sector strives to meet these requirements best. Production management tools that

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ensure high quality should be familiar to everyone in such companies. That is why Bosch decided to
gather all the most important of them and to create their own list of steps to improve their product. In
such a way that for each employee the rules are clear and legible. So what is the purpose behind the
implementation of 14 rules for production areas? The answer is simple, improving product quality
and reducing mistakes. In that case, there is no doubt that these actions make sense.

Another thing is to understand the scope of implementation and the area where it is to be
implemented. To properly implement the rules, you need to know the content carefully and then
gather as much information as possible about the general requirements of the business and get to
know the area where the rules are to be implemented.

As it knows, no project can be held without the right team. Therefore, one of the most important steps
in preparing for the implementation of the 14 principles is the establishment of the right people. Once
the team has been assembled, a very important part of the project can be addressed, which is the
assessment of the area in terms of the presence of rules based on comparative analysis. This will
allow to identify weaknesses of the process in relation to the requirements of the 14 principles and to
create a plan for the implementation of each improvement. From that point on, it is only a step away
from starting to implement the principles and observing the positive aspects of this action.

Thanks to the analysis it might be deducted, the points are the weakest and most need improvement.
The graph below (Figure 1) show exactly what the evaluation results look like.

Legend red: 0 ≤ rating < 1 yellow: 1 ≤ rating < 2 green: 2 ≤ rating ≤ 3

Fig. 1: Assessment results, based on the book by Fischer, Gemmer and Rach (2017)

To redefine expectations, it was necessary to re-examine the criteria and to determine how many of
them could improve. After our analysis, it was found that not only critical results could be adjusted.
As part of a continuous process of excellence and achieving the best results, even the good ones
could show themselves better.

Results and conclusion

Manufacturing companies are facing a big challenge today. In addition to high-quality goods
produced by the competition, they also have to meet the high requirements of customers. These
factors, among other things, force companies to continually improve their processes and products.
Most often, this is done with ready-made tools. For the entire Robert Bosch Corporation, the most
important of these tools have been collected as "14 quality principles for the value stream".

The main goal of this work is to implement these principles into one of the areas in the Bosch
production company. The area described here is one of the few that still does not meet the corporate

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standards for implementing policies. To change this state of affairs, the following steps have been
taken:
- creating a plan for the various activities that help to implement the rules properly, analyze the
resources needed,
- familiarize with 14 quality principles, understand and analyze them, adapt existing procedures to
content and criteria,
- familiarize with the functioning of the described area, the way of functioning and the management,
the knowledge of employees and the work they do,
- team instituting on the basis of skills and qualifications,
- detailed analysis of the state of the current area within the scope of the introduced rules,
comparative analysis of the current state with criteria included in the assessment list,
- draw conclusions from the assessment and propose improvements to the individual principles,
- creating an action plan, assigning responsibility to individuals, assessing time spent on tasks,
- brief discussion of the actions taken,
- presenting improved results through planned activities.

As a main indicator of evaluation is the assessment list, in which thanks for comparative analysis
every principle were evaluated. The list is a pre-imposed evaluation tool that has its pros and cons.
The advantage is that each area can be rated in the same way across the entire corporation. However,
the negative side of the list is the fact that by its generality it is not well suited to the specifications of
each area. This has led to the assessment of several issues that have been described and highlighted in
the assessment. In the end, however, thanks to the evaluation, we managed to find weaknesses and
plan actions to improve them. Many actions have been taken to raise the rating. Some of these were
based on well-known methods in manufacturing environments such as TPM, Poka-Yoke and Andon
Cord. On the other hand, others consisted of raising awareness of employees and bringing order in
heavily unkempt aspects. The visual side of 14 principles and the adjustment of the area to these
requirements have also played a large part.

In conclusion, in spite of encountering difficult situations, the ultimate goal of the job was achieved.
The most part of „14 Quality Principles for the Value Stream” has been implemented in the assembly
area. For rules that have not been implemented yet, there are already planned actions. This thesis can
be an example for implementing rules in the following areas. The lessons learned after the whole
process can be very informative for future activities. Among other things is to plan for a longer time
to do the task or better prepare the staff to implement the change. However, the important conclusion
is that some seemingly insignificant counterfeit activities can bring big benefits and will certainly
save many people from hard work on catching up arrears.

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